WNC HOUSING TAX CREDIT FUND V LP SERIES 3 - 10-K Annual Report

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FORM 10-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

(Mark One)

O ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934

For the fiscal year ended ________________________

OR

X TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934

For the transition period from January 1, 1999 to March 31, 1999

Commission file number: 0-21895

WNC HOUSING TAX CREDIT FUND V, L.P., SERIES 3

California 33-6163848
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)

3158 Redhill Avenue, Suite 120, Costa Mesa, CA 92626

(714) 662-5565

Securities registered pursuant to Section 12(b) of the Act:

NONE

Securities registered pursuant to section 12(g) of the Act:

UNITS OF LIMITED PARTNERSHIP INTEREST

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No ____

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. x

1

State the aggregate market value of the voting and non-voting common equity held
by non-affiliates of the registrant.

INAPPLICABLE

DOCUMENTS INCORPORATED BY REFERENCE

List hereunder the following documents if incorporated by reference and the Part
of the Form 10-K (e.g., Part I, Part II, etc.) into which the document is
incorporated: (1) Any annual report to security holders; (2) Any proxy or
information statement; and (3) Any prospectus filed pursuant to Rule 424(b) or
(c) under the Securities Act of 1933. The listed documents should be clearly
described for identification purposes (e.g., annual report to security holders
for fiscal year ended December 24, 1980).

NONE

2

PART I.

Item 1. Business

Organization

WNC Housing Tax Credit Fund V, L.P., Series 3 ("the Partnership") is a
California Limited Partnership formed under the laws of the State of California
on March 28, 1995, and commenced operations on October 24, 1995. The Partnership
was formed to acquire limited partnership interests in other limited
partnerships or limited liability companies ("Local Limited Partnerships") which
own multifamily apartment complexes that are eligible for low-income housing
federal and, in some cases, California income tax credits (the "Low Income
Housing Credit").

The general partner of the Partnership is WNC & Associates, Inc. (the "General
Partner" or "Associates"). Wilfred N. Cooper, Sr., through the Cooper Revocable
Trust, owns 66.8% of the outstanding stock of Associates. John B. Lester, Jr.
was the original limited partner of the Partnership and owns, through the Lester
Family Trust, 28.6% of the outstanding stock of Associates. The business of the
Partnership is conducted primarily through the General Partner as the
Partnership has no employees of its own.

Pursuant to a registration statement filed with the Securities and Exchange
Commission on July 26, 1995, the Partnership commenced a public offering of
25,000 Units of Limited Partnership Interest ("Units") at a price of $1,000 per
Unit. As of the close of the public offering, January 21, 1996 a total of 18,000
Limited Partnership Interests representing $17,558,985 had been sold.

Sempra Energy Financial, a California corporation, which is not an affiliate of
the Partnership or General Partner, has purchased 4,560 Units, which represents
25.3% of the Units outstanding for the Partnership. Sempra Energy Financial
invested $4,282,600. A discount of $277,400 was allowed due to a volume
discount. Western Financial Savings Bank, which is not an affiliate of the
Partnership or General Partner, has purchased 1,068 units, which represent 5.9%
of the Units outstanding for the Partnership. Western Financial Savings Bank
invested $1,000,000. A discount of $68,000 was allowed due to a volume discount.
See Item 12(a) in this 10-K.

Description of Business

The Partnership's principal business objective is to provide its Limited
Partners with Low Income Housing Credits. The Partnership's principal business
therefore consists of investing as a limited partner or non-managing member in
Local Limited Partnerships each of which will own and operate a multi-family
housing complex (the "Housing Complex") which will qualify for the Low Income
Housing Credit. In general, under Section 42 of the Internal Revenue Code, an
owner of low-income housing can receive the Low Income Housing Credit to be used
to reduce Federal taxes otherwise due in each year of a ten-year period. In
general, under Section 17058 of the California Revenue and Taxation Code, an
owner of low-income housing can receive the Low Income Housing Credit to be used
against California taxes otherwise due in each year of a four-year period. The
Housing Complex is subject to a fifteen-year compliance period (the "Compliance
Period"), and under state law may have to be maintained as low income housing
for 30 or more years.

In general, in order to avoid recapture of Low Income Housing Credits, the
Partnership does not expect that it will dispose of its interests in Local
Limited Partnerships ("Local Limited Partnership Interests") or approve the sale
by any Local Limited Partnership of its Housing Complex prior to the end of the
applicable Compliance Period. Because of (i) the nature of the Housing
Complexes, (ii) the difficulty of predicting the resale market for low-income
housing 15 or more years in the future, and (iii) the ability of government
lenders to disapprove of transfer, it is not possible at this time to predict
whether the liquidation of the Partnership's assets and the disposition of the
proceeds, if any, in accordance with the Partnership's Agreement of Limited
Partnership, as amended "by Supplements thereto" (the "Partnership Agreement"),
will be able to be accomplished promptly at the end of the 15-year period. If a
Local Limited Partnership is unable to sell its Housing Complex, it is
anticipated that the local general partner ("Local General Partner") will either
continue to operate such Housing Complex or take such other actions as the Local
General Partner believes to be in the best interest of the Local Limited
Partnership. Notwithstanding the preceding, circumstances beyond the control of
the General Partner or the Local General Partners may occur during the
Compliance Period, which would require the Partnership to approve the
disposition of a Housing Complex prior to the end thereof, possibly resulting in
recapture of Low Income Housing Credits.

3

As of March 31, 1999, the Partnership had invested in eighteen Local Limited
Partnerships. Each of these Local Limited Partnerships owns a Housing Complex
that is eligible for the federal Low Income Housing Credit. Certain Local
Limited Partnerships may also benefit from government programs promoting low- or
moderate-income housing.

The Partnership's investments in Local Limited Partnerships are subject to the
risks incident to the management and ownership of low-income housing and to the
management and ownership of multi-unit residential real estate. Some of these
risks are that the Low Income Housing Credit could be recaptured and that
neither the Partnership's investments nor the Housing Complexes owned by the
Local Limited Partnerships will be readily marketable. To the extent the Housing
Complexes receive government financing or operating subsidies, they may be
subject to one or more of the following risks: difficulties in obtaining tenants
for the Housing Complexes; difficulties in obtaining rent increases; limitations
on cash distributions; limitations on sales or refinancing of Housing Complexes;
limitations on transfers of Local Limited Partnership Interests; limitations on
removal of Local General Partners; limitations on subsidy programs; and possible
changes in applicable regulations. The Housing Complexes are subject to mortgage
indebtedness. If a Local Limited Partnership does not make its mortgage
payments, the lender could foreclose resulting in a loss of the Housing Complex
and Low Income Housing Credits. As a limited partner or non-managing member of
the Local Limited Partnerships, the Partnership will have very limited rights
with respect to management of the Local Limited Partnerships, and will rely
totally on the general partners or managing members of the Local Limited
Partnerships for management of the Local Limited Partnerships. The value of the
Partnership's investments will be subject to changes in national and local
economic conditions, including unemployment conditions, which could adversely
impact vacancy levels, rental payment defaults and operating expenses. This, in
turn, could substantially increase the risk of operating losses for the Housing
Complexes and the Partnership. In addition, each Local Limited Partnership is
subject to risks relating to environmental hazards and natural disasters, which
might be uninsurable. Because the Partnership's operations will depend on these
and other factors beyond the control of the General Partner and the Local
General Partners, there can be no assurance that the anticipated Low Income
Housing Credits will be available to Limited Partners.

In addition, Limited Partners are subject to risks in that the rules governing
the Low Income Housing Credit are complicated, and the use of credits can be
limited. The only material benefit from an investment in Units may be the Low
Income Housing Credits. There are limits on the transferability of Units, and it
is unlikely that a market for Units will develop. All Partnership management
decisions are made by the General Partner.

As a limited partner or non-managing member, the Partnership's liability for
obligations of each Local Limited Partnership is limited to its investment. The
Local General Partners of each Local Limited Partnership retain responsibility
for developing, constructing, maintaining, operating and managing the Housing
Complexes.

Item 2. Properties

Through its investments in Local Limited Partnerships, the Partnership holds
limited partnership interests in the Housing Complexes. The following table
reflects the status of the eighteen Housing Complexes as of the dates and for
the periods indicated:

4

------------------------------- ----------------------------------------
As of March 31, 1999 As of December 31, 1998
------------------------------- ----------------------------------------
Partnership's Estimated Encumbrances
Total Investment Amount of Low Income of Local
in Local Limited Investment Number Occu- Housing Limited
Partnership Name Location General Partner Name Partnerships Paid to Date of Units pancy Credits Partnerships
- ------------------------------------------------------------------------------------------------------------------------------------

Alliance Apartments I Alliance, Retro Development, Inc. $ 604,000 $ 604,000 19 84% $ 363,000 $ 615,000
Limited Partnership Nebraska

Blessed Rock of El El Monte, Everland, Inc. 2,511,000 2,511,000 137 99% 8,899,000 3,841,000
Monte California

Broadway Apartments, Hobbs, New Trianon - Broadway, LLC,
Limited Partnership Mexico a New Mexico Limited
Liability Company 2,004,000 1,931,000 78 83% 2,335,000 1,402,000

Cascade Pines, L.P. II Atlanta, Urban Residential
Georgia Management, Inc., a Georgia
Corporation 1,347,000 1,347,000 376 83% 2,533,000 8,023,000

Curtis Associates I, Curtis, Joseph A. Shepard and
L.P. Nebraska Kenneth M. Vitor 88,000 66,000 12 58% 156,000 427,000

Escatawpa Village Escatawpa, Clifford E. Olsen 249,000 249,000 32 100% 458,000 898,000
Associates, Limited Mississippi
Partnership

Evergreen Apartments Tulsa, Retro Development, Inc. of
I Limited Partnership Oklahoma Oklahoma and Most Worshipful
Prince Hall Grand Lodge 549,000 549,000 76 68% 991,000 652,000

Hastings Apartments Hastings, Retro Development, Inc. of
I, Limited Partnership Nebraska Oklahoma and Most Worshipful
Prince Hall Grand Lodge 542,000 542,000 18 83% 1,005,000 611,000

Heritage Apartments Berkeley, Joseph A. Shepard and
I, L.P. Missouri Kenneth M. Vitor 752,000 752,000 30 100% 1,333,000 694,000

Hillcrest Associates, Ontario, Riley J. Hill 354,000 354,000 28 96% 683,000 1,301,000
A Limited Partnership Oregon

5

------------------------------- ----------------------------------------
As of March 31, 1999 As of December 31, 1998
------------------------------- ----------------------------------------
Partnership's Estimated Encumbrances
Total Investment Amount of Low Income of Local
in Local Limited Investment Number Occu- Housing Limited
Partnership Name Location General Partner Name Partnerships Paid to Date of Units pancy Credits Partnerships
- ------------------------------------------------------------------------------------------------------------------------------------

Patten Towers, L.P. II Chattanooga, Patten Towers Partners,
Tennessee LLC 2,154,000 2,154,000 221 98% 3,938,000 7,275,000

Prairieland Syracuse, Kenneth M. Vitor 85,000 85,000 8 100% 152,000 294,000
Properties of Kansas
Syracuse II, L.P.

Raymond S. King Greensboro, Project Homestead, Inc. 437,000 437,000 23 100% 883,000 782,000
Apartments Limited North
Partnership Carolina

Rosedale Limited Silver City, Deke Noftsker and ABO
Partnership New Mexico Corporation 309,000 309,000 32 94% 547,000 1,324,000

Shepherd South Shepherd, Donald W. Sowell 121,000 121,000 24 100% 223,000 577,000
Apartments I, Ltd. Texas

Solomon Associates I, Solomon, Joseph A. Shepard and
L.P. Kansas Kenneth M. Vitor 138,000 138,000 16 100% 250,000 569,000

Talladega County Talladega, Apartment Developers, Inc.
Housing Ltd. Alabama and Thomas H. Cooksey 653,000 653,000 30 97% 1,200,000 811,000

The Willows Morganton, John C. Loving, Gordon D.
Apartments Limited North Brown, Jr. and
Partnership Carolina Western N.C.
Housing Partnership 841,000 841,000 36 100% 1,545,000 1,122,000
---------- ---------- ----- ---- ---------- ----------
$ 13,738,000 $ 13,643,000 1,196 91% $ 27,494,000 $ 31,218,000
========== ========== ===== ==== ========== ==========

6

-------------------------------------------------------------------------------
For the year ended December 31, 1998
-------------------------------------------------------------------------------
Low Income Housing
Credits Allocated to
Partnership Name Rental Income Net Loss Partnership
- -------------------------------------------------------------------------------------------------------------------

Alliance Apartments I Limited
Partnership $ 65,000 $ (64,000) 99%

Blessed Rock of El Monte 656,000 (111,000) 49.49%

Broadway Apartments, Limited
Partnership 152,000 (285,000) 99%

Cascade Pines, L.P. II 1,821,000 (152,000) 98%

Curtis Associates I, L.P. 30,000 (24,000) 99%

Escatawpa Village Associates,
Limited Partnership 119,000 (25,000) 99%

Evergreen Apartments I Limited
Partnership 174,000 (224,000) 99%

Hastings Apartments I, Limited
Partnership 83,000 (59,000) 99%

Heritage Apartments I, L.P. 102,000 (45,000) 98.9%

Hillcrest Associates, A Limited
Partnership 188,000 (37,000) 99%

Patten Towers, L.P. II 1,483,000 (38,000) 99%

Prairieland Properties of Syracuse
II, L.P. 51,000 (9,000) 99%

Raymond S. King Apartments Limited
Partnership 65,000 (32,000) 99%

Rosedale Limited Partnership 135,000 (47,000) 99%

Shepherd South Apartments I, Ltd. 87,000 (4,000) 99%

Solomon Associates I, L.P. 92,000 (27,000) 99%

Talladega County Housing Ltd. 86,000 (41,000) 99%

The Willows Apartments Limited
Partnership 112,000 (19,000) 99%
----------- -----------
$ 5,501,000 $ (1,243,000)
=========== ===========

7

Item 3. Legal Proceedings

NONE.

Item 4. Submission of Matters to a Vote of Security Holders

NONE.

PART II.

Item 5. Market for Registrant's Common Equity and Related Stockholder Matters

Item 5a.

(a) The Units are not traded on a public exchange but were sold through a
public offering. It is not anticipated that any public market will develop
for the purchase and sale of any Unit and none exists. Units can be
assigned only if certain requirements in the Partnership Agreement are
satisfied.

(b) At March 31, 1999, there were 859 Limited Partners.

(c) The Partnership was not designed to provide cash distributions to Limited
Partners in circumstances other than refinancing or disposition of its
investments in Local Limited Partnerships.

(d) No unregistered securities were sold by the Partnership during the three
months ended March 31, 1999.

Item 5b.

NOT APPLICABLE

Item 6. Selected Financial Data

Selected balance sheet information for the Partnership is as follows:

March 31 December 31
------------------------- -----------------------------------------------------
1999 1998 1998 1997 1996 1995
---- ---- ---- ---- ---- ----
(Unaudited)
ASSETS

Cash and cash equivalents $ 911,080 $ 1,530,527 $ 950,372 $ 2,018,591 $ 2,567,217 $ 660,999
Cash in escrow - - - - - 1,873,262
Subscriptions receivable - - - - 2,195,000 484,000
Investments in limited
partnerships, net 12,250,789 13,574,257 12,559,525 13,836,734 12,782,751 1,046,532
Interest receivable - - - 19,435 - -
Loan receivable - - - - 522,190 661,306
Other assets - 4,492 - - 105,998 73
---------- ---------- ---------- ---------- ---------- ----------
$ 13,161,869 $ 15,109,276 $ 13,509,897 $ 15,874,760 $ 18,173,156 $ 4,726,172
========== ========== ========== ========== ========== ==========
LIABILITIES
Due to limited partnerships $ 95,030 $ 692,287 $ 95,030 $ 1,290,351 $ 2,822,885 $ 309,852
Accrued fees and expenses
due to general partner
and affiliates 28,677 18,329 62,496 4,640 43,807 570,137

PARTNERS' EQUITY 13,038,162 14,398,660 13,352,371 14,579,769 15,306,464 3,846,183
---------- ---------- ---------- ---------- ---------- ----------
$ 13,161,869 $ 15,109,276 $ 13,509,897 $ 15,874,760 $ 18,173,156 $ 4,726,172
========== ========== ========== ========== ========== ==========

8

Selected results of operations, cash flows, and other information for the
Partnership is as follows:

For the Three Months
Ended March 31 For the Years Ended December 31
------------------------- -----------------------------------------------------
1999 1998 1998 1997 1996 1995
---- ---- ---- ---- ---- ----
(Unaudited)

Income (loss) from
operations $ (20,391) $ (10,209) $ (52,065) $ 20,214 $ 117,374 $ (9,346)
Equity in losses of limited
partnerships (293,818) (170,900) (1,175,333) (789,697) (185,071) (343)
---------- ----------- ----------- ---------- ---------- ----------

Net loss $ (314,209) $ (181,109) $ (1,227,398) $ (769,483) $ (67,697) $ (9,689)
========== =========== =========== ========== ========== ==========
Net loss allocated to:
General partner $ (3,142) $ (1,811) $ (12,274) $ (7,695) $ (677) $ (97)
========== =========== =========== ========== ========== ==========
Limited partners $ (311,067) $ (179,298) $ (1,215,124) $ (761,788) $ (67,020) $ (9,592)
========== =========== =========== ========== ========== ==========
Net loss per limited
partner unit $ (17.28) $ (9.96) $ (67.51) $ (42.32) $ (4.94) $ (14.58)
========== =========== =========== ========== ========== ==========
Outstanding weighted
limited partner units $ 18,000 $ 18,000 $ 18,000 $ 18,000 $ 13,564 $ 658
========== =========== =========== ========== ========== ==========

For the Three Months
Ended March 31 For the Years Ended December 31
------------------------- -----------------------------------------------------
1999 1998 1998 1997 1996 1995
---- ---- ---- ---- ---- ----
(Unaudited)
Net cash provided by
(used in):
Operating activities $ (45,335) $ 27,295 $ 60,991 $ 102,215 $ (205,999) $ 3,402
Investing activities 6,043 (515,359) (1,129,210) (2,888,629) (7,704,761) (2,944,048)
Financing activities - - - 2,237,788 9,816,978 3,601,645
---------- ----------- ----------- ---------- ---------- ----------
Net change in cash and cash
equivalents (39,292) (488,064) (1,068,219) (548,626) 1,906,218 660,999

Cash and cash equivalents,
beginning of period 950,372 2,018,591 2,018,591 2,567,217 660,999 -
---------- ----------- ----------- ---------- ---------- ----------
Cash and cash equivalents,
end of period $ 911,080 $ 1,530,527 $ 950,372 $ 2,018,591 $ 2,567,217 $ 660,999
========== =========== =========== ========== ========== ==========

Low Income Housing Credit per Unit was as follows for the years ended December 31:

1998 1997 1996 1995
---- ---- ---- ----
Federal $ 131 $ 83 $ 59 $ 14
State - - - -
--------- --------- --------- ---------
Total $ 131 $ 83 $ 59 $ 14
========= ========= ========= =========

9

Item 7. Management's Discussion and Analysis of Financial Condition and Results
of Operation

Financial Condition

The Partnership's assets at March 31, 1999 consisted primarily of $911,080 in
cash and aggregate investments in the eighteen Local Limited Partnerships of
$12,250,789. Liabilities at March 31, 1999 primarily consisted of $95,030 due to
limited partnerships and $28,677 of accrued annual management fees and
reimbursements due to the General Partner.

Results of Operations

Three Months Ended March 31, 1999 Compared to Three Months Ended March 31, 1998.
The Partnership's net loss for the three months ended March 31, 1999 was
$(314,000), reflecting an increase of $133,000 from the net loss experienced for
the three months ended March 31, 1998. The increase in net loss is due to equity
in losses of limited partnerships which increased by $123,000 to $(294,000) for
the three month period ended March 31, 1999 from $(171,000) for the three month
period ended March 31, 1998. In addition to the increase in equity in losses of
limited partnerships, the Partnership experienced an increase in net loss from
operations of $10,000 to $(20,000) for the three month period ended March 31,
1999 from $(10,000) for the three month period ended March 31, 1998 due to a
decrease in interest income of $7,000 and an increase in operating expenses of
$3,000.

Year Ended December 31, 1998 Compared to Year Ended December 31, 1997. The
Partnership's net loss for 1998 was $(1,227,000), reflecting an increase of
$458,000 from the net loss experienced in 1997. The increase in net loss is
primarily due to equity in losses from limited partnerships which increased to
$(1,175,000) in 1998 from $(790,000) in 1997, in addition to a decrease in
interest income of $67,000 and an increase in operating expenses of $6,000.

Year Ended December 31, 1997 Compared to Year Ended December 31, 1996. The
Partnership's net loss for 1997 was $(769,000), reflecting an increase of
$701,000 from the net loss experienced in 1996. The increase in net loss is
primarily due to equity in losses from limited partnerships which increased to
$(790,000) in 1997 from $(185,000) in 1996, in addition to a decrease in
interest income of $88,000 and an increase in operating expenses of $9,000.

Cash Flows

Three Months Ended March 31, 1999 Compared to Three Months Ended March 31, 1998.
Net decrease in cash during the three months ended March 31, 1999 was $(39,000)
compared to a net decrease in cash for the three months ended March 31, 1998 of
$(488,000). The change was due primarily to a decrease in investments in limited
partnerships of $523,000 offset by an increase in cash paid to the General
Partner or affiliates of $48,000 and a decrease in interest received of $22,000.

Year Ended December 31, 1998 Compared to Year Ended December 31, 1997. Net
decrease in cash in 1998 was $(1,068,000), compared to a net decrease in cash in
1997 of $(549,000). The decrease in cash was higher in 1998 as compared to 1997
due primarily to a decrease in capital contributions from partners of $2,250,000
and a decrease in cash provided by operating activities of $41,000, offset by a
decrease in offering expenses of $12,000, a decrease in investments in Limited
Partnerships of $1,745,000 and an increase in distributions from Limited
Partnerships of $15,000.

Year Ended December 31, 1997 Compared to Year Ended December 31, 1996. Net
decrease in cash in 1997 was $(549,000), compared to a net increase in cash in
1997 of $1,906,000. The change was due primarily to a decrease in capital
contributions from partners of $9,084,000, offset by a decrease in offering
expenses of $1,505,000, a decrease in investing activities of $4,816,000,
primarily from a decrease in investments in Limited Partnerships, a decrease in
cash in escrow, an increase in loans receivable, and a decrease in capitalized
acquisition costs. In addition, net cash from operating activities increased by
$308,000.

10

During the three months ended March 31, 1999 and the year ended December 31,
1998, accrued payables, which consist primarily of related party management fees
due to the General Partner, decreased by $34,000 and increased by $58,000,
respectively. The General Partner does not anticipate that these accrued fees
will be paid in full until such time as capital reserves are in excess of future
forseeable working capital requirements of the Partnership.

The Partnership expects its future cash flows, together with its net available
assets at March 31, 1999, to be sufficient to meet all currently forseeable
future cash requirements.

Impact of Year 2000

WNC & Associates, Inc.

Status of Readiness

Information Technology (IT) Systems. The Partnership relies on the IT systems of
WNC, its general partner. IT systems include computer hardware and software used
to produce financial reports and tax return information. This information is
then used to generate reports to investors and regulatory agencies, including
the Internal Revenue Service and the Securities and Exchange Commission. The IT
systems of WNC are year 2000 compliant.

Non-IT Systems. The Partnership also relies on the non-IT systems of WNC. Non-IT
systems include machinery and equipment such as telephones, voice mail and
electronic postage equipment. Except for one telephone system, the non-IT
systems of WNC are year 2000 compliant. The one telephone system will require
the replacement of one computer and one software application, both of which will
be completed on or before October 1, 1999.

Service Providers. WNC also relies on the IT and non-IT systems of service
providers. Service providers include utility companies, financial institutions,
telecommunications carriers, municipalities, and other outside vendors. WNC has
obtained verbal assurances from its material service providers (electrical power
provider, financial institutions and telecommunications carriers) that their IT
and non-IT systems are year 2000 compliant. There can be no assurance that this
compliance information is correct. There also can be no assurance that the
systems of other, less-important service providers and outside vendors will be
year 2000 compliant.

Costs to Address Year 2000 Issues

The cost to address year 2000 issues for WNC has been less than $20,000. The
cost to replace the telephone system noted above will be less than $5,000. The
cost to deal with potential year 2000 issues of other outside vendors cannot be
estimated at this time.

Risk of Year 2000 Issues

The most reasonable and likely result from non-year 2000 compliance of systems
of the service providers noted above will be the disruption of normal business
operations for WNC. This disruption would, in turn, lead to delays in performing
reporting and fiduciary responsibilities on behalf of the Partnership. The worst
case scenario would be the replacement of a service provider. These delays would
likely be temporary and would likely not have a material effect on the
Partnership or WNC.

11

Local Limited Partnerships

Status of Readiness

WNC is in the process of obtaining year 2000 certifications from each Local
General Partner of each Local Limited Partnership. Those certifications will
represent to the Partnership that the IT and non-IT systems critical to the
operation of the Housing Complexes and investor reporting to the Partnership are
year 2000 compliant. These certifications will also represent to the Partnership
that the IT and non-IT systems of property management companies, independent
accountants, electrical power providers, financial institutions and
telecommunications carriers used by the Local Limited Partnership are year 2000
compliant.

There can be no assurance that the representations in the certifications will be
correct. There also can be no assurance that the systems of other,
less-important service providers and outside vendors, upon which the Local
Limited Partnerships rely, will be year 2000 compliant.

Costs to Address Year 2000 Issues

There will be no cost to the Partnership as a result of assessing year 2000
issues for the Local Limited Partnerships. The cost to deal with potential year
2000 issues of the Local Limited Partnerships cannot be estimated at this time.

Risk of Year 2000 Issues

There may be Local General Partners who indicate that they or their property
management company are not year 2000 compliant and do not have plans to become
year 2000 compliant before the end of 1999. There may be other Local General
Partners who are unwilling to respond to the certification request. The most
likely result of either non-compliance or failure to respond will be the removal
and replacement of the property management company and/or the Local General
Partner with year 2000 compliant operators.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

NOT APPLICABLE

Item 8. Financial Statements and Supplementary Data

12

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

To the Partners
WNC Housing Tax Credit Fund V, L.P., Series 3

We have audited the accompanying balance sheets of WNC Housing Tax Credit Fund
V, L.P., Series 3 (a California Limited Partnership) (the "Partnership") as of
March 31, 1999 and December 31, 1998, and the related statements of operations,
partners' equity (deficit) and cash flows for the three months ended March 31,
1999 and the year ended December 31, 1998. 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. A significant
portion of the financial statements of the limited partnerships in which the
Partnership is a limited partner were audited by other auditors whose reports
have been furnished to us. As discussed in Note 2 to the financial statements,
the Partnership accounts for its investments in limited partnerships using the
equity method. The portion of the Partnership's investment in limited
partnerships audited by other auditors represented 83% of the total assets of
the Partnership at March 31, 1999 and December 31, 1998. Our opinion, insofar as
it relates to the amounts included in the financial statements for the limited
partnerships which were audited by others, is based solely on the reports of the
other auditors.

We conducted our audits in accordance with generally accepted auditing
standards. 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 and the reports of the other auditors provide a
reasonable basis for our opinion.

In our opinion, based on our audits and the reports of the other auditors, the
financial statements referred to above present fairly, in all material respects,
the financial position of WNC Housing Tax Credit Fund V, L.P., Series 3 (a
California Limited Partnership) as of March 31, 1999 and December 31, 1998, and
the results of its operations and its cash flows for the three months ended
March 31, 1999 and the year ended December 31, 1998, in conformity with
generally accepted accounting principles.

/s/ BDO SEIDMAN, LLP
BDO SEIDMAN, LLP

Orange County, California
August 2, 1999

13

INDEPENDENT AUDITORS' REPORT

To the Partners
WNC Housing Tax Credit Fund V, L.P., Series 3

We have audited the accompanying balance sheet of WNC Housing Tax Credit Fund V,
L.P., Series 3 (a California Limited Partnership) (the "Partnership") as of
December 31, 1997, and the related statements of operations, partners' equity
(deficit) and cash flows for each of the years in the two-year period ended
December 31, 1997. 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 did not audit the financial
statements of the limited partnerships in which WNC Housing Tax Credit Fund V,
L.P., Series 3 is a limited partner. These investments, as discussed in Note 3
to the financial statements, are accounted for by the equity method. The
investment in these limited partnerships represented 87% of the total assets of
WNC Housing Tax Credit Fund V, L.P., Series 3 at December 31, 1997. A
substantial portion of the financial statements of the limited partnerships were
audited by other auditors whose reports have been furnished to us, and our
opinion, insofar as it relates to the amounts included for these limited
partnerships, is based solely on the reports of the other auditors.

We conducted our audits in accordance with generally accepted auditing
standards. 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 and the reports of the other auditors provide a
reasonable basis for our opinion.

In our opinion, based on our audits and the reports of the other auditors, the
financial statements referred to above present fairly, in all material respects,
the financial position of WNC Housing Tax Credit Fund V, L.P., Series 3 (a
California Limited Partnership) as of December 31, 1997, and the results of its
operations and its cash flows for each of the years in the two-year period ended
December 31, 1997, in conformity with generally accepted accounting principles.

/s/ CORBIN & WERTZ
CORBIN & WERTZ

Irvine, California
April 21, 1998

14

WNC HOUSING TAX CREDIT FUND V, L.P., SERIES 3
(A California Limited Partnership)

BALANCE SHEETS

March 31 December 31
------------------------------ ------------------------------
1999 1998 1998 1997
---- ---- ---- ----
(Unaudited)
ASSETS

Cash and cash equivalents $ 911,080 $ 1,530,527 $ 950,372 $ 2,018,591
Investments in limited partnerships (Note 2) 12,250,789 13,574,257 12,559,525 13,836,734
Interest receivable - - - 19,435
Other assets - 4,492 - -
----------- ----------- ----------- -----------
$ 13,161,869 $ 15,109,276 $ 13,509,897 $ 15,874,760
=========== =========== =========== ===========
LIABILITIES AND PARTNERS' EQUITY
(DEFICIT)

Liabilities:
Payables to limited partnerships (Note 4) $ 95,030 $ 692,287 $ 95,030 $ 1,290,351
Accrued fees and advances due to General
Partner and affiliates (Note 3) 28,677 18,329 62,496 4,640
----------- ----------- ----------- -----------
Total liabilities 123,707 710,616 157,526 1,294,991
----------- ----------- ----------- -----------
Partners' equity (deficit):
General partner (45,109) (31,504) (41,967) (29,693)
Limited partners (25,000 units authorized,
18,000 units issued and outstanding) 13,083,271 14,430,164 13,394,338 14,609,462
----------- ----------- ----------- -----------
Total partners' equity 13,038,162 14,398,660 13,352,371 14,579,769
----------- ----------- ----------- -----------
$ 13,161,869 $ 15,109,276 $ 13,509,897 $ 15,874,760
=========== =========== =========== ===========

See accompanying notes to financial statements
15

WNC HOUSING TAX CREDIT FUND V, L.P., SERIES 3
(A California Limited Partnership)

STATEMENTS OF OPERATIONS

For the Three Months Ended
March 31 For the Years Ended December 31
---------------------------- -------------------------------------------
1999 1998 1998 1997 1996
---- ---- ---- ---- ----
(Unaudited)

Interest income $ 9,994 $ 17,039 $ 55,326 $ 121,703 $ 209,940
------------ ------------- ------------ ------------ ------------
Operating expenses:
Amortization (Note 2) 8,875 8,872 35,765 34,605 23,436
Asset management fees (Note 3) 12,375 12,375 49,500 49,500 49,500
Other 9,135 6,001 22,126 17,384 19,630
------------ ------------- ------------ ------------ ------------

Total operating expenses 30,385 27,248 107,391 101,489 92,566
------------ ------------- ------------ ------------ ------------

Income (loss) from operations (20,391) (10,209) (52,065) 20,214 117,374

Equity in losses of limited
partnerships (Note 2) (293,818) (170,900) (1,175,333) (789,697) (185,071)
------------ ------------- ------------ ------------ ------------

Net loss $ (314,209) $ (181,109) $ (1,227,398) $ (769,483) $ (67,697)
============ ============= ============ ============ ============
Net loss allocated to:
General partner $ (3,142) $ (1,811) $ (12,274) $ (7,695) $ (677)
============ ============= ============ ============ ============
Limited partners $ (311,067) $ (179,298) $ (1,215,124) $ (761,788) $ (67,020)
============ ============= ============ ============ ============

Net loss per limited partner unit $ (17.28) $ (9.96) $ (67.51) $ (42.32) $ (4.94)
============ ============= ============ ============ ============

Outstanding weighted limited
partner units 18,000 18,000 18,000 18,000 13,564
============ ============= ============ ============ ============

See accompanying notes to financial statements
16

WNC HOUSING TAX CREDIT FUND V, L.P., SERIES 3
(A California Limited Partnership)

STATEMENTS OF PARTNERS' EQUITY (DEFICIT)

For The Three Months Ended March 31, 1999 and
For The Years Ended December 31, 1998, 1997 and 1996

General Limited
Partner Partners Total
------- -------- -----
Partners' equity (deficit)
at January 1, 1996 $ (6,029) $ 3,852,212 $ 3,846,183

Capital contributions,
net of discount of $438,015 - 13,064,985 13,064,985

Cash collected on notes
receivable (Note 6) - 35,000 35,000

Capital issued for notes
receivable (Note 6) - (55,000) (55,000)

Offering expenses (15,170) (1,501,837) (1,517,007)

Net loss (677) (67,020) (67,697)
----------- ----------- -----------
Partners' equity (deficit)
at December 31, 1996 (21,876) 15,328,340 15,306,464

Offering expenses (122) (12,090) (12,212)

Cash collected on notes
receivable (Note 6) - 55,000 55,000

Net loss (7,695) (761,788) (769,483)
----------- ----------- -----------
Partners' equity (deficit)
at December 31, 1997 (29,693) 14,609,462 14,579,769

Net loss (12,274) (1,215,124) (1,227,398)
----------- ----------- -----------
Partners' equity (deficit)
at December 31, 1998 (41,967) 13,394,338 13,352,371

Net loss (3,142) (311,067) (314,209)
----------- ----------- -----------
Partners' equity (deficit)
at March 31, 1999 $ (45,109) $ 13,083,271 $ 13,038,162
=========== =========== ===========

See accompanying notes to financial statements
17

WNC HOUSING TAX CREDIT FUND V, L.P., SERIES 3
(A California Limited Partnership)

STATEMENTS OF CASH FLOWS

For the Three Months
Ended March 31 For the Years Ended December 31
-------------------------- -----------------------------------------
1999 1998 1998 1997 1996
---- ---- ---- ---- ----
(Unaudited)

Cash flows from operating activities:
Net loss $ (314,209) $ (181,109) $ (1,227,398) $ (769,483) $ (67,697)
Adjustments to reconcile net loss
to net cash provided by (used in)
operating activities:
Amortization 8,875 8,872 35,765 34,605 23,436
Equity in losses of limited
partnerships 293,818 170,900 1,175,333 789,697 185,071
Change in interest receivable - 14,943 19,435 86,563 (105,925)
Increase in accrued fees and
expenses due to general partner
and affiliates (33,819) 13,689 57,856 (39,167) (240,884)
----------- ----------- ----------- ----------- -----------
Net cash provided by (used in)
operating activities (45,335) 27,295 60,991 102,215 (205,999)
----------- ----------- ----------- ----------- -----------
Cash flows from investing activities:
Investments in limited
partnerships, net - (522,922) (1,120,181) (3,432,735) (8,693,189)
Cash in escrow - - - - 1,873,262
Loans receivable - - - 522,190 139,116
Capitalized acquisition costs
and fees (1,520) - (32,076) (28,975) (1,023,950)
Return of acquisition fees (Note 3) - - - 42,551 -
Distributions from limited
partnerships 7,563 7,563 23,047 8,340 -
----------- ----------- ----------- ----------- -----------
Net cash provided by (used in)
investing activities 6,043 (515,359) (1,129,210) (2,888,629) (7,704,761)
----------- ----------- ----------- ----------- -----------
Cash flows from financing activities:
Capital contributions from partners - - - 2,250,000 11,333,985
Offering expenses - - - (12,212) (1,517,007)
----------- ----------- ----------- ----------- -----------
Net cash provided by financing
activities - - - 2,237,788 9,816,978
----------- ----------- ----------- ----------- -----------
Net increase (decrease) in cash and
cash equivalents (39,292) (488,064) (1,068,219) (548,626) 1,906,218

Cash and cash equivalents, beginning
of period 950,372 2,018,591 2,018,591 2,567,217 660,999
----------- ----------- ----------- ----------- -----------
Cash and cash equivalents, end of
period $ 911,080 $ 1,530,527 $ 950,372 $ 2,018,591 $ 2,567,217
=========== =========== =========== =========== ===========

See accompanying notes to financial statements
18

WNC HOUSING TAX CREDIT FUND V, L.P., SERIES 3
(A California Limited Partnership)

STATEMENTS OF CASH FLOWS - CONTINUED

For the Three Months
Ended March 31 For the Years Ended December 31
-------------------------- -----------------------------------------

1999 1998 1998 1997 1996
---- ---- ---- ---- ----
(Unaudited)

SUPPLEMENTAL DISCLOSURE
OF CASH FLOW INFORMATION

Taxes paid $ - $ - $ 800 $ 800 $ 800
=========== =========== =========== =========== ===========

SUPPLEMENTAL DISCLOSURE OF NONCASH FINANCING AND INVESTING ACTIVITIES
During 1997, the Partnership incurred, but did not pay, $526,643 of payables
to limited partnerships (in connection with its investments in limited
partnerships) (see Note 4).

See accompanying notes to financial statements
19

WNC HOUSING TAX CREDIT FUND V, L.P., SERIES 3
(A California Limited Partnership)

NOTES TO FINANCIAL STATEMENTS

For The Three Months Ended March 31, 1999 and 1998 (Unaudited) and
For The Years Ended December 31, 1998, 1997 and 1996

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization

WNC Housing Tax Credit Fund V, L.P., Series 3, a California Limited Partnership
(the "Partnership"), was formed on March 28, 1995, under the laws of the state
of California. The Partnership was formed to invest primarily in other limited
partnerships (the "Local Limited Partnerships") which own and operate
multi-family housing complexes (the "Housing Complex") that are eligible for low
income housing credits. The local general partners (the "Local General
Partners") of each Local Limited Partnership retain responsibility for
maintaining, operating and managing the Housing Complex.

The general partner is WNC & Associates, Inc. ("WNC"). Wilfred N. Cooper, Sr.,
through the Cooper Revocable Trust owns 66.8% of the outstanding stock of WNC.
John B. Lester was the original limited partner of the Partnership and owns
28.6% of the outstanding stock of WNC.

The Partnership shall continue in full force and effect until December 31, 2050
unless terminated prior to that date pursuant to the partnership agreement or
law.

The financial statements include only activity relating to the business of the
Partnership, and do not give effect to any assets that the partners may have
outside of their interests in the Partnership, or to any obligations, including
income taxes, of the partners.

The partnership agreement authorized the sale of up to 25,000 units at $1,000
per Unit ("Units"). The offering of Units concluded in January 1996, at which
time 18,000 Units representing subscriptions in the amount of $17,558,985, net
of $441,015 of discounts for volume purchases, had been accepted. The General
Partner has a 1% interest in operating profits and losses, taxable income and
losses, cash available for distribution from the Partnership and tax credits.
The limited partners will be allocated the remaining 99% of these items in
proportion to their respective investments.

After the limited partners have received proceeds from a sale or refinancing
equal to their capital contributions and their return on investment (as defined
in the Partnership Agreement) and the General Partner has received proceeds
equal to its capital contribution and a subordinated disposition fee (as
described in Note 3) from the remainder, any additional sale or refinancing
proceeds will be distributed 90% to the limited partners (in proportion to their
respective investments) and 10% to the General Partner.

Change in Reporting Year End

The Partnership has elected to change its year end for financial reporting
purposes from December 31 to March 31. All financial information reflected in
the financial statements and related footnotes has been adjusted for this change
in year end except for the combined condensed financial information relating to
the Local Limited Partnerships included in Note 2.

Due to the change in year end, unaudited financial information as of and for the
three months ended March 31, 1998 is included in the financial statements for
comparative purposes only. The financial statements as of and for the three
months ended March 31, 1998 are unaudited but include all adjustments
(consisting of normal recurring adjustments) which are, in the opinion of
management, necessary for a fair statement of financial position and results of
operations of the Partnership for the interim period.

20

WNC HOUSING TAX CREDIT FUND V, L.P., SERIES 3
(A California Limited Partnership)

NOTES TO FINANCIAL STATEMENTS - CONTINUED

For The Three Months Ended March 31, 1999 and 1998 (Unaudited) and
For The Years Ended December 31, 1998, 1997 and 1996

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued

Risks and Uncertainties

The Partnership's investments in Local Limited Partnerships are subject to the
risks incident to the management and ownership of low-income housing and to the
management and ownership of multi-unit residential real estate. Some of these
risks are that the low income housing credit could be recaptured and that
neither the Partnership's investments nor the Housing Complexes owned by the
Local Limited Partnerships will be readily marketable. To the extent the Housing
Complexes receive government financing or operating subsidies, they may be
subject to one or more of the following risks: difficulties in obtaining tenants
for the Housing Complexes; difficulties in obtaining rent increases; limitations
on cash distributions; limitations on sales or refinancing of Housing Complexes;
limitations on transfers of Local Limited Partnership Interests; limitations on
removal of Local General Partners; limitations on subsidy programs; and possible
changes in applicable regulations. The Housing Complexes are or will be subject
to mortgage indebtedness. If a Local Limited Partnership does not make its
mortgage payments, the lender could foreclose resulting in a loss of the Housing
Complex and low income housing credits. As a limited partner of the Local
Limited Partnerships, the Partnership will have very limited rights with respect
to management of the Local Limited Partnerships, and will rely totally on the
Local General Partners of the Local Limited Partnerships for management of the
Local Limited Partnerships. The value of the Partnership's investments will be
subject to changes in national and local economic conditions, including
unemployment conditions, which could adversely impact vacancy levels, rental
payment defaults and operating expenses. This, in turn, could substantially
increase the risk of operating losses for the Housing Complexes and the
Partnership. In addition, each Local Limited Partnership is subject to risks
relating to environmental hazards and natural disasters which might be
uninsurable. Because the Partnership's operations will depend on these and other
factors beyond the control of the General Partner and the Local General
Partners, there can be no assurance that the anticipated low income housing
credits will be available to Limited Partners.

In addition, Limited Partners are subject to risks in that the rules governing
the low income housing credit are complicated, and the use of credits can be
limited. The only material benefit from an investment in Units may be the low
income housing credits. There are limits on the transferability of Units, and it
is unlikely that a market for Units will develop. All management decisions will
be made by the General Partner.

Method of Accounting For Investments in Limited Partnerships

The Partnership accounts for its investments in limited partnerships using the
equity method of accounting, whereby the Partnership adjusts its investment
balance for its share of the Local Limited Partnership's results of operations
and for any distributions received. The accounting policies of the Local Limited
Partnerships are consistent with those of the Partnership. Costs incurred by the
Partnership in acquiring the investments are capitalized as part of the
investment account and are being amortized over 30 years (see Note 2).

Losses from limited partnerships for the years ended December 31, 1998, 1997 and
1996 have been recorded by the Partnership based on reported results provided by
the Local Limited Partnerships. Losses from limited partnerships for the three
months ended March 31, 1999 and 1998 have been estimated by management of the
Partnership. Losses from Local Limited Partnerships allocated to the Partnership
will not be recognized to the extent that the investment balance would be
adjusted below zero.

21

WNC HOUSING TAX CREDIT FUND V, L.P., SERIES 3
(A California Limited Partnership)

NOTES TO FINANCIAL STATEMENTS - CONTINUED

For The Three Months Ended March 31, 1999 and 1998 (Unaudited) and
For The Years Ended December 31, 1998, 1997 and 1996

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued

Offering Expenses

Offering expenses consist of underwriting commissions, legal fees, printing,
filing and recordation fees, and other costs incurred in connection with selling
limited partnership interests in the Partnership. The General Partner is
obligated to pay all offering and organization costs in excess of 15% (including
sales commissions) of the total offering proceeds. Offering expenses are
reflected as a reduction of limited partners' capital and amounted to $2,132,000
at the end of all periods presented.

Use of Estimates

The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements, and
the reported amounts of revenues and expenses during the reporting period.
Actual results could materially differ from those estimates.

Cash and Cash Equivalents

The Partnership considers highly liquid investments with remaining maturities of
three months or less when purchased to be cash equivalents. As of March 31, 1999
and December 31, 1998 and 1997, the Partnership had cash equivalents of $0, $0
and $978,453, respectively, representing U.S. Treasury Bills.

Concentration of Credit Risk

At March 31, 1999, the Partnership maintained cash balances at certain financial
institutions in excess of the federally insured maximum.

Net Loss Per Limited Partner Unit

Net loss per limited partnership unit is calculated pursuant to Statement of
Financial Accounting Standards No. 128, Earnings Per Share. Net loss per unit
includes no dilution and is computed by dividing loss available to limited
partners by the weighted average number of units outstanding during the period.
Calculation of diluted net income per unit is not required.

Reporting Comprehensive Income

In June 1997, the FASB issued Statement of Financial Accounting Standards
("SFAS") No. 130, Reporting Comprehensive Income. This statement establishes
standards for reporting the components of comprehensive income and requires that
all items that are required to be recognized under accounting standards as
components of comprehensive income be included in a financial statement that is
displayed with the same prominence as other financial statements. Comprehensive
income includes net income as well as certain items that are reported directly
within a separate component of partners' equity and bypass net income. The
Partnership adopted the provisions of this statement in 1998. For the periods
presented, the Partnership has no elements of other comprehensive income, as
defined by SFAS No. 130.

Reclassifications

Certain prior year balances have been reclassified to conform to the 1999
presentation.

22

WNC HOUSING TAX CREDIT FUND V, L.P., SERIES 3
(A California Limited Partnership)

NOTES TO FINANCIAL STATEMENTS - CONTINUED

For The Three Months Ended March 31, 1999 and 1998 (Unaudited) and
For The Years Ended December 31, 1998, 1997 and 1996

NOTE 2 - INVESTMENTS IN LIMITED PARTNERSHIPS

As of the periods presented, the Partnership has acquired limited partnership
interests in 18 Local Limited Partnerships, each of which owns one Housing
Complex consisting of an aggregate of 1,196 apartment units. The respective
general partners of the Local Limited Partnerships manage the day to day
operations of the entities. Significant Local Limited Partnership business
decisions require approval from the Partnership. The Partnership, as a limited
partner, is generally entitled to 99%, as specified in the Local Limited
Partnership agreements, of the operating profits and losses, taxable income and
losses and tax credits of the Local Limited Partnerships, except for one of the
investments in which it is entitled to 49.49% of such amounts.

The Partnership's investments in Local Limited Partnerships as reflected in the
balance sheet at December 31, 1998 and 1997, are approximately $1,187,000 and
$2,206,000, respectively, greater than the Partnership's equity as shown in the
Local Limited Partnerships' financial statements. This difference is primarily
due to acquisition costs related to the acquisition of the investments that have
been capitalized in the Partnership's investment account and to capital
contributions payable to the limited partnerships which were netted against
partner capital in the Local Limited Partnerships' financial statements.

Equity in losses of Local Limited Partnerships is recognized in the financial
statements until the related investment account is reduced to a zero balance.
Losses incurred after the investment account is reduced to zero are not
recognized. If the Local Limited Partnerships report net income in future years,
the Partnership will resume applying the equity method only after its share of
such net income equals the share of net losses not recognized during the
period(s) the equity method was suspended.

Distributions received by limited partners are accounted for as a reduction of
the investment balance. Distributions received after the investment has reached
zero are recognized as income. During 1999 and 1998, no investment accounts in
Local Limited Partnerships reached a zero balance.

Following is a summary of the equity method activity of the investments in Local
Limited Partnerships for the periods presented:

For the Three
Months Ended For the Years Ended
March 31 December 31
--------------- -----------------------------------
1999 1998 1997
---- ---- ----

Investments per balance sheet, beginning of period $ 12,559,525 $ 13,836,734 $ 12,782,751
Capital contributions paid, net - - 1,373,557
Capital contributions payable to limited partnerships - - 526,644
Capitalized acquisition fees and costs 1,520 32,076 28,975
Tax credit adjustments - (75,140) -
Return of acquisition fees (Note 4) - - (42,551)
Distributions received (7,563) (23,047) (8,340)
Equity in losses of limited partnerships (293,818) (1,175,333) (789,697)
Amortization of paid acquisition fees and costs (8,875) (35,765) (34,605)
----------- ----------- -----------
Investments per balance sheet, end of period $ 12,250,789 $ 12,559,525 $ 13,836,734
=========== =========== ===========

23

WNC HOUSING TAX CREDIT FUND V, L.P., SERIES 3
(A California Limited Partnership)

NOTES TO FINANCIAL STATEMENTS - CONTINUED

For The Three Months Ended March 31, 1999 and 1998 (Unaudited) and
For The Years Ended December 31, 1998, 1997 and 1996

NOTE 2 - INVESTMENTS IN LIMITED PARTNERSHIPS, continued

The financial information from the individual financial statements of the Local
Limited Partnerships include rental and interest subsidies. Rental subsidies are
included in total revenues and interest subsidies are generally netted against
interest expense. Approximate combined condensed financial information from the
individual financial statements of the Local Limited Partnerships as of December
31 and for the years then ended is as follows:

COMBINED CONDENSED BALANCE SHEETS

1998 1997
---- ----
ASSETS

Buildings and improvements, net of accumulated
depreciation of $3,757,000 and $2,187,000,
respectively $ 43,183,000 $ 44,490,000
Construction in progress - 95,000
Land 2,943,000 2,939,000
Other assets (including due from affiliates of $44,000
and $235,000 as of December 31, 1998 and 1997,
respectively) 4,293,000 4,608,000
----------- -----------

$ 50,419,000 $ 52,132,000
=========== ===========
LIABILITIES

Mortgage and construction loans payable $ 31,218,000 $ 32,582,000
Other liabilities (including due to related parties of
$3,459,000 and $3,667,000 as of December 31, 1998
and 1997, respectively) 4,714,000 5,143,000
----------- -----------
35,932,000 37,725,000
----------- -----------
PARTNERS' CAPITAL

WNC California Housing Tax Credits Fund, V,
L.P., Series 3 11,373,000 11,631,000
Other partners 3,114,000 2,776,000
----------- -----------
14,487,000 14,407,000
----------- -----------
$ 50,419,000 $ 52,132,000
=========== ===========

24

WNC HOUSING TAX CREDIT FUND V, L.P., SERIES 3
(A California Limited Partnership)

NOTES TO FINANCIAL STATEMENTS - CONTINUED

For The Three Months Ended March 31, 1999 and 1998 (Unaudited) and
For The Years Ended December 31, 1998, 1997 and 1996

NOTE 2 - INVESTMENTS IN LIMITED PARTNERSHIPS, continued

COMBINED CONDENSED STATEMENTS OF OPERATIONS

1998 1997 1996
---- ---- ----

Revenues $ 5,705,000 $ 5,339,000 $ 3,981,000
----------- ----------- -----------
Expenses:
Operating expenses 3,580,000 3,331,000 2,053,000
Interest expense 1,739,000 1,625,000 1,282,000
Depreciation and amortization 1,629,000 1,246,000 864,000
----------- ----------- -----------
Total expenses 6,948,000 6,202,000 4,199,000
----------- ----------- -----------

Net loss $ (1,243,000) $ (863,000) $ (218,000)
=========== =========== ===========

Net loss allocable to the Partnership $ (1,175,000) $ (790,000) $ (185,000)
=========== =========== ===========

Net loss recorded by the Partnership $ (1,175,000) $ (790,000) $ (185,000)
=========== =========== ===========

Certain Local Limited Partnerships have incurred significant operating losses
and have working capital deficiencies. In the event these Local Limited
Partnerships continue to incur significant operating losses, additional capital
contributions by the Partnership and/or the Local General Partner may be
required to sustain the operations of such Local Limited Partnerships. If
additional capital contributions are not made when they are required, the
Partnership's investment in certain of such Local Limited Partnerships could be
impaired.

NOTE 3 - RELATED PARTY TRANSACTIONS

Under the terms of the Partnership Agreement, the Partnership has paid or is
obligated to the General Partner or its affiliates for the following items:

Acquisition fees of up to 7.5% of the gross proceeds from the sale of Units
as compensation for services rendered in connection with the acquisition of
Local Limited Partnerships. As of December 31, 1996, the Partnership
incurred acquisition fees of $1,008,550 which were included in investments
in limited partnerships. During 1997, acquisition fees of $42,551 were
returned to the Partnership by an affiliate, as allowed by the terms of the
Partnership Agreement, resulting in acquisition fees of $965,999 for all
periods presented. Accumulated amortization of these capitalized costs was
$94,962, $86,912 and $54,714 as of March 31, 1999 and December 31, 1998 and
1997, respectively.

Reimbursement of costs incurred by an affiliate of the General Partner in
connection with the acquisition of Local Limited Partnerships. These
reimbursements have not exceeded 1% of the gross proceeds. As of March 31,
1999 and December 31, 1998 and 1997, the Partnership incurred acquisition
costs of $132,607, $131,087 and $99,011, respectively, which have been
included in investments in limited partnerships. Accumulated amortization
was $8,173, $7,348 and $3,781 as of March 31, 1999 and December 31, 1998,
1997, respectively.

25

WNC HOUSING TAX CREDIT FUND V, L.P., SERIES 3
(A California Limited Partnership)

NOTES TO FINANCIAL STATEMENTS - CONTINUED

For The Three Months Ended March 31, 1999 and 1998 (Unaudited) and
For The Years Ended December 31, 1998, 1997 and 1996

NOTE 3 - RELATED PARTY TRANSACTIONS, continued

An annual asset management fee equal to the greater amount of (i) $2,000
for each Housing complex, or (ii) 0.275% of gross proceeds. In either case,
the fee will be decreased or increased annually based on changes to the
Consumer Price Index. However, in no event will the maximum amount exceed
0.2% of the invested assets of the limited partnerships, including the
Partnership's allocable share of the mortgages. Management fees of $12,375
were incurred during the three months ended March 31, 1999 and $49,500 were
incurred for 1998, 1997 and 1996, of which $49,500 was paid during the
three months ended March 31, 1999 and $0 $110,000 and $0 were paid during
1998, 1997 and 1996, respectively.

A subordinated disposition fee in an amount equal to 1% of the sales price
of real estate sold. Payment of this fee is subordinated to the limited
partners receiving a preferred return of 14% through December 31, 2006 and
6% thereafter (as defined in the Partnership Agreement) and is payable only
if the General Partner or its affiliates render services in the sales
effort.

The accrued fees and expenses due to the General Partner and affiliates consist
of the following:

March 31 December 31
--------------- -----------------------------------

1999 1998 1997
---- ---- ----

Reimbursements for expenses paid by the $ 14,935 $ 11,629 $ 3,273
General Partner or an affiliate

Asset management fee payable 13,742 50,867 1,367
------------ ------------ ------------
Total $ 28,677 $ 62,496 $ 4,640
============ ============ ============

NOTE 4 - PAYABLES TO LIMITED PARTNERSHIPS

Payables to Local Limited Partnerships represent amounts which are due at
various times based on conditions specified in the respective limited
partnership agreements. These contributions are payable in installments and are
generally due upon the Local Limited Partnerships achieving certain development
and operating benchmarks (generally within two years of the Partnership's
initial investment).

NOTE 5 - INCOME TAXES

No provision for income taxes has been recorded in the accompanying financial
statements as any liability for income taxes is the obligation of the partners
of the Partnership.

26

WNC HOUSING TAX CREDIT FUND V, L.P., SERIES 3
(A California Limited Partnership)

NOTES TO FINANCIAL STATEMENTS - CONTINUED

For The Three Months Ended March 31, 1999 and 1998 (Unaudited) and
For The Years Ended December 31, 1998, 1997 and 1996

NOTE 6 - SUBSCRIPTIONS AND NOTES RECEIVABLE

During 1996, the Partnership received subscriptions for 2,250 Units consisting
of receivables of $2,195,000 and promissory notes of $55,000, all of which were
collected in 1997. During 1995, the Partnership received subscriptions for 519
Units consisting of receivables of $484,000 and promissory notes of $35,000, all
of which were collected in 1996. Limited partners who subscribed for ten or more
Units of limited partnership interest ($10,000) could elect to pay 50% of the
purchase price in cash upon subscription and the remaining 50% by the delivery
of a promissory note payable, together with interest at the rate of 10.25% per
annum, due no later than 13 months after the subscription date. Since
subscription receivables were collected subsequent to year end but before the
issuance of the respective financial statements, the Partnership reflected such
amounts as capital contributions and an asset in the financial statements. Since
the promissory notes had not been collected prior to issuance of the respective
financial statements, the unpaid balance was reflected as a reduction of
partners' equity in the financial statements. Upon collection of the promissory
notes, such amounts were reflected as capital contributions in the year
collected.

27

Item 9. Changes in and Disagreements With Accountants on Accounting and
Financial Disclosure

NOT APPLICABLE

PART III.

Item 10. Directors and Executive Officers of the Registrant

The Partnership has no directors or executive officers of its own. The following
biographical information is presented for the directors and executive officers
of Associates which has principal responsibility for the Partnership's affairs.

Directors and Executive Officers of WNC & Associates, Inc.

The directors of WNC & Associates, Inc. are Wilfred N. Cooper, Sr., who serves
as Chairman of the Board, John B. Lester, Jr., David N. Shafer, Wilfred N.
Cooper, Jr. and Kay L. Cooper. The principal shareholders of WNC & Associates,
Inc. are trusts established by Wilfred N. Cooper, Sr. and John B. Lester, Jr.

Wilfred N. Cooper, Sr., age 68, is the founder, Chief Executive Officer and a
Director of WNC & Associates, Inc., a Director of WNC Capital Corporation, and a
general partner in some of the programs previously sponsored by the Sponsor. Mr.
Cooper has been involved in real estate investment and acquisition activities
since 1968. Previously, during 1970 and 1971, he was founder and principal of
Creative Equity Development Corporation, a predecessor of WNC & Associates,
Inc., and of Creative Equity Corporation, a real estate investment firm. For 12
years prior to that, Mr. Cooper was employed by Rockwell International
Corporation, last serving as its manager of housing and urban developments where
he had responsibility for factory-built housing evaluation and project
management in urban planning and development. Mr. Cooper is a Director of the
National Association of Home Builders (NAHB) and a National Trustee for NAHB's
Political Action Committee, a Director of the National Housing Conference (NHC)
and a member of NHC's Executive Committee and a Director of the National
Multi-Housing Council (NMHC). Mr. Cooper graduated from Pomona College in 1956
with a Bachelor of Arts degree.

John B. Lester, Jr., age 65, is President, a Director, Secretary and a member of
the Acquisition Committee of WNC & Associates, Inc., and a Director of WNC
Capital Corporation. Mr. Lester has 27 years of experience in engineering and
construction and has been involved in real estate investment and acquisition
activities since 1986 when he joined the Sponsor. Previously, he was Chairman of
the Board and Vice President or President of E & L Associates, Inc., a provider
of engineering and construction services to the oil refinery and petrochemical
industries, which he co-founded in 1973. Mr. Lester graduated from the
University of Southern California in 1956 with a Bachelor of Science degree in
Mechanical Engineering.

Wilfred N. Cooper, Jr., age 36, is Executive Vice President, a Director and a
member of the Acquisition Committee of WNC & Associates, Inc. He is President
of, and a registered principal with, WNC Capital Corporation, a member firm of
the NASD, and is a Director of WNC Management, Inc. He has been involved in
investment and acquisition activities with respect to real estate since he
joined the Sponsor in 1988. Prior to this, he served as Government Affairs
Assistant with Honda North America in Washington, D.C. Mr. Cooper is a member of
the Advisory Board for LIHC Monthly Report, a Director of NMHC and an Alternate
Director of NAHB. He graduated from The American University in 1985 with a
Bachelor of Arts degree.

David N. Shafer, age 47, is Senior Vice President, a Director, General Counsel,
and a member of the Acquisition Committee of WNC & Associates, Inc., and a
Director and Secretary of WNC Management, Inc. Mr. Shafer has been involved in
real estate investment and acquisition activities since 1984. Prior to joining
the Sponsor in 1990, he was practicing law with a specialty in real estate and
taxation. Mr. Shafer is a Director and President of the California Council of
Affordable Housing and a member of the State Bar of California. Mr. Shafer
graduated from the University of California at Santa Barbara in 1978 with a
Bachelor of Arts degree, from the New England School of Law in 1983 with a Juris
Doctor degree (cum laude) and from the University of San Diego in 1986 with a
Master of Law degree in Taxation.

28

Michael L. Dickenson, age 42, is Vice President and Chief Financial Officer, and
a member of the Acquisition Committee of WNC & Associates, Inc., and Chief
Financial Officer of WNC Management, Inc. He has been involved with acquisition
and investment activities with respect to real estate since 1985. Prior to
joining the Sponsor in March 1999, he was the Director of Financial Services at
TrizecHahn Centers Inc., a developer and operator of commercial real estate,
from 1995 to 1999, a Senior Manager with E&Y Kenneth Leventhal Real Estate
Group, Ernst & Young, LLP, from 1988 to 1995, and Vice President of Finance with
Great Southwest Companies, a commercial and residential real estate developer,
from 1985 to 1988. Mr. Dickenson is a member of the Financial Accounting
Standards Committee for the National Association of Real Estate Companies and
the American Institute of Certified Public Accountants, and a Director of
HomeAid Southern California, a charitable organization affiliated with the
building industry. He graduated from Texas Tech University in 1978 with a
Bachelor of Business Administration - Accounting degree, and is a Certified
Public Accountant in California and Texas.

Thomas J. Riha, age 44, is Vice President - Asset Management and a member of the
Acquisition Committee of WNC & Associates, Inc. and a Director and Chief
Executive Officer of WNC Management, Inc. Mr. Riha has been involved in
acquisition and investment activities with respect to real estate since 1979.
Prior to joining the Sponsor in 1994, Mr. Riha was employed by Trust Realty
Advisor, a real estate acquisition and management company, last serving as Vice
President - Operations. Mr. Riha graduated from the California State University,
Fullerton in 1977 with a Bachelor of Arts degree (cum laude) in Business
Administration with a concentration in Accounting and is a Certified Public
Accountant and a member of the American Institute of Certified Public
Accountants.

Sy P. Garban, age 53, is Vice President - National Sales of WNC & Associates,
Inc. and has been employed by the Sponsor since 1989. Mr. Garban has been
involved in real estate investment activities since 1978. Prior to joining the
Sponsor he served as Executive Vice President of MRW, Inc., a real estate
development and management firm. Mr. Garban is a member of the International
Association of Financial Planners. He graduated from Michigan State University
in 1967 with a Bachelor of Science degree in Business Administration.

N. Paul Buckland, age 36, is Vice President - Acquisitions of WNC & Associates,
Inc. He has been involved in real estate acquisitions and investments since 1986
and has been employed with WNC & Associates, Inc. since 1994. Prior to that, he
served on the development team of the Bixby Ranch that constructed apartment
units and Class A office space in California and neighboring states, and as a
land acquisition coordinator with Lincoln Property Company where he identified
and analyzed multi-family developments. Mr. Buckland graduated from California
State University, Fullerton in 1992 with a Bachelor of Science degree in
Business Finance.

David Turek, age 44, is Vice President - Originations of WNC & Associates, Inc.
He has been involved with real estate investment and finance activities since
1976 and has been employed by WNC & Associates, Inc. since 1996. From 1995 to
1996, Mr. Turek served as a consultant for a national Tax Credit sponsor where
he was responsible for on-site feasibility studies and due diligence analyses of
Tax Credit properties. From 1990 to 1995, he was involved in the development of
conventional and tax credit multi-family housing. He is a Director with the
Texas Council for Affordable Rural Housing and graduated from Southern Methodist
University in 1976 with a Bachelor of Business Administration degree.

Kay L. Cooper, age 62, is a Director of WNC & Associates, Inc. Mrs. Cooper was
the founder and sole proprietor of Agate 108, a manufacturer and retailer of
home accessory products, from 1975 until 1998. She is the wife of Wilfred N.
Cooper, Sr., the mother of Wilfred N. Cooper, Jr. and the sister of John B.
Lester, Jr. Ms. Cooper graduated from the University of Southern California in
1958 with a Bachelor of Science degree.

29

Item 11. Executive Compensation

The Partnership has no officers, employees, or directors. However, under the
terms of the Partnership Agreement the Partnership is obligated to the General
Partner or Associates for the following fees:

(a) Annual Asset Management Fee. An annual asset management fee of the greater
of (i) $2,000 per multi-family housing complex or (ii) 0.275% of Gross
Proceeds. The base fee amount will be adjusted annually based on changes
in the Consumer Price Index, however in no event will the annual asset
management fee exceed 0.2% of Invested Assets. "Invested Assets" means the
sum of the Partnership's Investment in Local Limited Partnerships and the
Partnership's allocable share of the amount of mortgages on and other
indebtedness related to the Housing Complexes. Fees of $12,375 and $49,500
were incurred during the three months ended March 31, 1999 and the year
ended December 31, 1998, respectively. The Partnership paid the General
Partner or its affiliates $49,500 and $0 of these fees during the three
months ended March 31, 1999 and the year ended December 31, 1998,
respectively.

(b) Subordinated Disposition Fee. A subordinated disposition fee in an amount
equal to 1% of the sale price received in connection with the sale or
disposition of a Housing Complex or Local Limited Partnership Interest.
Subordinated disposition fees will be subordinated to the prior return of
the Limited Partners' capital contributions and payment of the Return on
Investment to the Limited Partners. "Return on Investment" means an
annual, cumulative but not compounded, "return" to the Limited Partners
(including Low Income Housing Credits) as a class on their adjusted
capital contributions commencing for each Limited Partner on the last day
of the calendar quarter during which the Limited Partner's capital
contribution is received by the Partnership, calculated at the following
rates: (i) 14% through December 31, 2006 and (ii) 6% for the balance of
the Partnerships term. No disposition fees have been paid.

(c) Interest in Partnership. The General Partner receives 1% of the
Partnership's allocated Low Income Housing Credits, which approximated
$24,000 for the General Partner for the year ended December 31, 1998. The
General Partners are also entitled to receive 1% of cash distributions.
There were no distributions of cash to the General Partners during the
three months ended March 31, 1999 or during the year ended December 31,
1998, respectively.

Item 12. Security Ownership of Certain Beneficial Owners and Management

(a) Security Ownership of Certain Beneficial Owners

The following are the only limited partners known to the General Partner
to own beneficially in excess of 5% of the outstanding Units.

Amount of
Units
Title of Class Name and Address of Beneficial Owner Controlled Percent of Class
-------------------------- -------------------------------------- ---------------- ------------------

Units of Limited Sempra Energy Financial 4,560 units 25.3%
Partnership Interests P.O. Box 126943
San Diego, CA 92113-6943

Units of Limited Western Financial Savings Bank 1,068 units 5.9%
Partnership Interests 23 Pasteur
Irvine, CA 92718

(b) Security Ownership of Management

Neither the General Partner, its affiliates, nor any of the officers or
directors of the General Partner or its affiliates own directly or
beneficially any Units in the Partnership.

30

(c) Changes in Control

The management and control of the General Partner may be changed at any
time in accordance with its organizational documents, without the consent
or approval of the Limited Partners. In addition, the Partnership Agreement
provides for the admission of one or more additional and successor General
Partners in certain circumstances.

First, with the consent of any other General Partners and a
majority-in-interest of the Limited Partners, any General Partner may
designate one or more persons to be successor or additional General
Partners. In addition, any General Partner may, without the consent of any
other General Partner or the Limited Partners, (i) substitute in its stead
as General Partner any entity which has, by merger, consolidation or
otherwise, acquired substantially all of its assets, stock or other
evidence of equity interest and continued its business, or (ii) cause to be
admitted to the Partnership an additional General Partner or Partners if it
deems such admission to be necessary or desirable so that the Partnership
will be classified a partnership for Federal income tax purposes. Finally,
a majority-in-interest of the Limited Partners may at any time remove the
General Partner of the Partnership and elect a successor General Partner.

Item 13. Certain Relationships and Related Transactions

The General Partner manages all of the Partnership's affairs. The transactions
with the General Partner are primarily in the form of fees paid by the
Partnership for services rendered to the Partnership and the General Partner's
interest in the Partnership, as discussed in Item 11 and in the notes to the
Partnership's financial statements.

31

PART IV.

Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K

Financial Statements

(a)(1) Financial statements included in Part II hereof:

Report of Independent Certified Public Accountants
Independent Auditors' Report
Balance Sheets, March 31, 1999 and 1998 (Unaudited) and December 31,
1998 and 1997
Statements of Operations for the three months ended March 31, 1999 and
1998 (Unaudited) and for the years ended December 31, 1998, 1997 and
1996
Statements of Partners' Equity (Deficit) for the three months ended
March 31, 1999 and for the years ended December 31, 1998, 1997 and
1996
Statements of Cash Flows for the three months ended March 31, 1999 and
1998 (Unaudited) and for the years ended December 31, 1998, 1997 and
1996
Notes to Financial Statements

(a)(2) Financial statement schedules included in Part IV hereof:

Report of Independent Certified Public Accountants on Financial State-
ment Schedules
Schedule III - Real Estate Owned by Local Limited Partnerships

(b) Reports on Form 8-K

1. A Form 8-K dated May 13, 1999 was filed on May 14, 1999 reporting the
Partnership's change in fiscal year end to March 31. No financial
statements were included.

(c) Exhibits

3.1 Articles of incorporation and by-laws: The registrant is not
incorporated. The Partnership Agreement is included as Exhibit B to the
Prospectus, filed as Exhibit 28.1 to Form 10-K dated December 31, 1995
is hereby incorporated herein by reference as exhibit 3.1.

10.1 Amended and Restated Agreement of Limited Partnership of Evergreen
Apartments I Limited Partnership filed as exhibit 10.1 to Form 8-K
dated November 14, 1995 is hereby incorporated herein by reference as
exhibit 10.1.

10.2 Amended and Restated Agreement of Limited Partnership of Shepherd
South Apartments I, Ltd. filed as exhibit 10.1 to Form 8-K dated
December 14, 1995 is hereby incorporated herein by reference as
exhibit 10.2.

10.3 Amended and Restated Agreement of Limited Partnership of Patten
Towers, L.P. II filed as exhibit 10.1 to Form 8-K dated December 21,
1995 is hereby incorporated herein by reference as exhibit 10.3.

10.4 Second Amended and Restated Agreement of Limited Partnership of
Alliance Apartments I Limited Partnership filed as exhibit 10.7 to
Post-Effective Amendment No.2 to Registration Statement on Form S-11 of
the Partnership is hereby incorporated herein by reference as exhibit
10.4.

10.5 Amended and Restated Agreement of Limited Partnership of Hastings
Apartments I Limited Partnership filed as exhibit 10.8 to
Post-Effective Amendment No.2 to Registration Statement on Form S-11 of
the Partnership is hereby incorporated herein by reference as exhibit
10.5.

10.6 Agreement of Limited Partnership of Raymond S. King Apartments I
Limited Partnership filed as exhibit 10.9 to Post-Effective Amendment
No. 2 to Registration Statement on Form S-11 of the Partnership is
hereby incorporated herein by reference as exhibit 10.6

10.7. Amended and Restated Agreement of Limited Partnership of Talladega
County Housing, Ltd. filed as exhibit 10.10 to Post-Effective
Amendment No. to Registration Statement on Form S-11 of the
Partnership is hereby incorporated herein by reference as exhibit
10.7.

10.8 Amended and Restated Agreement of Limited Partnership of The Willows
Limited Partnership filed as exhibit 10.11 to Post-Effective Amendment
No. to Registration Statement on Form S-11 of the Partnership is hereby
incorporated herein by reference as exhibit 10.8

10.9 Amended and Restated Agreement of Limited Partnership of Cascade Pines
L.P. II filed as exhibit 10.1 to Form 8-K dated April 26, 1996 is
hereby incorporated herein by reference as exhibit 10.9

10.10 Amended and Restated Agreement of Limited Partnership of Rosedale
Limited Partnership filed as exhibit 10.2 to Form 8-K dated April 26,
1996 is hereby incorporated herein by reference as exhibit 10.10

10.11 Amended and Restated Agreement of Limited Partnership of Blessed Rock
of El Monte filed as exhibit 10.1 to Form 8-K dated September 17, 1996
is hereby incorporated herein by reference as exhibit 10.11

10.12 Amended and Restated Agreement of Limited Partnership of Broadway
Apartments, Limited Partnership filed as exhibit 10.1 to Form 8-K
dated April 10, 1997 is hereby incorporated herein by reference as
exhibit 10.12

(d) Financial statement schedules follow, as set forth in subsection
(a)(2) hereof.

33

Report of Independent Certified Public Accountants on
Financial Statement Schedules

To the Partners
WNC Housing Tax Credit Fund V, L.P., Series 3

The audits referred to in our report dated August 2, 1999, relating to the 1999
and 1998 financial statements of WNC Housing Tax Credit Fund V, L.P., Series 3
(the "Partnership"), which is contained in Item 8 of this Form 10-K, included
the audit of the accompanying financial statement schedules. The financial
statement schedules are the responsibility of the Partnership's management. Our
responsibility is to express an opinion on these financial statement schedules
based upon our audits.

In our opinion, such financial statement schedules present fairly, in all
material respects, the financial information set forth therein.

/s/ BDO SEIDMAN, LLP
BDO SEIDMAN, LLP

Orange County, California
August 2, 1999

34

WNC Housing Tax Credit Fund V, L.P., Series 3
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 1999

---------------------------------- ------------------------------------------------------
As of March 31, 1999 As of December 31, 1998
---------------------------------- ------------------------------------------------------
Partnership's Total Amount of Encumbrances of Net
Investment in Local Investment Local Limited Property and Accumulated Book
Partnership Name Location Limited Partnerships Paid to Date Partnerships Equipment Depreciation Value
- ------------------------------------------------------------------------------------------------------------------------------------

Alliance Apartments I Alliance,
Limited Partnership Nebraska $ 604,000 $ 604,000 $ 615,000 $ 1,549,000 $ 141,000 $ 1,408,000

Blessed Rock of El Monte El Monte,
California 2,511,000 2,511,000 3,841,000 9,289,000 279,000 9,010,000

Broadway Apartments, Hobbs,
Limited Partnership New Mexico 2,004,000 1,931,000 1,402,000 3,334,000 156,000 3,178,000

Cascade Pines, L.P. II Atlanta,
Georgia 1,347,000 1,347,000 8,023,000 8,392,000 706,000 7,686,000

Curtis Associates I, L.P. Curtis,
Nebraska 88,000 66,000 427,000 497,000 44,000 453,000

Escatawpa Village Escatawpa,
Associates, Limited Mississippi 249,000 249,000 898,000 1,417,000 100,000 1,317,000
Partnership

Evergreen Apartments I Tulsa,
Limited Partnership Oklahoma 549,000 549,000 652,000 1,886,000 199,000 1,687,000

Hastings Apartments I, Hastings,
Limited Partnership Nebraska 542,000 542,000 611,000 1,335,000 106,000 1,229,000

Heritage Apartments I, Berkeley,
L.P. Missouri 752,000 752,000 694,000 1,679,000 80,000 1,599,000

35

WNC Housing Tax Credit Fund V, L.P., Series 3
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 1999

---------------------------------- ------------------------------------------------------
As of March 31, 1999 As of December 31, 1998
---------------------------------- ------------------------------------------------------
Partnership's Total Amount of Encumbrances of Net
Investment in Local Investment Local Limited Property and Accumulated Book
Partnership Name Location Limited Partnerships Paid to Date Partnerships Equipment Depreciation Value
- ------------------------------------------------------------------------------------------------------------------------------------

Hillcrest Associates, a Ontario,
Limited Partnership Oregon 354,000 354,000 1,301,000 1,697,000 198,000 1,499,000

Patten Towers, L.P. II Chattanooga,
Tennessee 2,154,000 2,154,000 7,275,000 10,715,000 1,095,000 9,620,000

Prairieland Properties Syracuse,
of Syracuse II, L.P. Kansas 85,000 85,000 294,000 511,000 37,000 474,000

Raymond S. King Greensboro,
Apartments North Carolina 437,000 437,000 782,000 1,096,000 84,000 1,012,000
Limited
Partnership

Rosedale Limited Silver City,
Partnership New Mexico 309,000 309,000 1,324,000 1,679,000 193,000 1,486,000

Shepherd South Shepherd,
Apartments I, Ltd. Texas 121,000 121,000 577,000 720,000 57,000 663,000

Solomon Associates I, Solomon,
L.P. Kansas 138,000 138,000 569,000 716,000 68,000 648,000

Talladega County Talladega,
Housing Ltd. Alabama 653,000 653,000 811,000 1,466,000 112,000 1,354,000

The Willows Apartments Morganton, North
Limited Partnership Carolina 841,000 841,000 1,122,000 1,905,000 102,000 1,803,000
---------- ---------- ---------- ---------- --------- ----------
$ 13,738,000 $ 13,643,000 $ 31,218,000 $ 49,883,000 $ 3,757,000 $ 46,126,000
========== ========== ========== ========== ========= ==========

36

WNC Housing Tax Credit Fund V, L.P., Series 3
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 1999

---------------------------------------------------------------------------------
For the year ended December 31, 1998
---------------------------------------------------------------------------------
Year Estimated
Investment Useful Life
Partnership Name Rental Income Net Loss Status Acquired (Years)
- --------------------------------------------------------------------------------------------------------------------------

Alliance Apartments I Limited
Partnership $ 65,000 $ (64,000) Completed 1997 40

Blessed Rock of El Monte 656,000 (111,000) Completed 1997 40

Broadway Apartments, Limited
Partnership 152,000 (285,000) Completed 1997 40

Cascade Pines, L.P. II 1,821,000 (152,000) Completed 1997 40

Curtis Associates I, L.P. 30,000 (24,000) Completed 1997 27.5

Escatawpa Village Associates, Limited
Partnership 119,000 (25,000) Completed 1997 27.5

Evergreen Apartments I Limited
Partnership 174,000 (224,000) Completed 1996 40

Hastings Apartments I, Limited
Partnership 83,000 (59,000) Completed 1996 40

Heritage Apartments I, L.P. 102,000 (45,000) Completed 1997 27.5

Hillcrest Associates, A Limited
Partnership 188,000 (37,000) Completed 1997 27.5

Patten Towers, L.P. II 1,483,000 (38,000) Completed 1996 27.5

Prairieland Properties of Syracuse
II, L.P. 51,000 (9,000) Completed 1997 27.5

Raymond S. King Apartments Limited
Partnership 65,000 (32,000) Completed 1997 30

Rosedale Limited Partnership 135,000 (47,000) Completed 1997 30

Shepherd South Apartments I, Ltd. 87,000 (4,000) Completed 1996 40

Solomon Associates I, L.P. 92,000 (27,000) Completed 1997 27.5

Talladega County Housing Ltd. 86,000 (41,000) Completed 1996 40

The Willows Apartments Limited
Partnership 112,000 (19,000) Completed 1997 40
------------ ----------
$ 5,501,000 $ (1,243,000)
============ ==========

37

WNC Housing Tax Credit Fund V, L.P., Series 3
Schedule III
Real Estate Owned by Local Limited Partnerships
December 31, 1998

-------------------------------------------------------------------------------------------
As of December 31, 1998
-------------------------------------------------------------------------------------------
Partnership's Total Amount of Encumbrances of Net
Investment in Local Investment Local Limited Property and Accumulated Book
Partnership Name Location Limited Partnerships Paid to Date Partnerships Equipment Depreciation Value
- ------------------------------------------------------------------------------------------------------------------------------------

Alliance Apartments I Alliance,
Limited Partnership Nebraska $ 604,000 $ 604,000 $ 615,000 $ 1,549,000 $ 141,000 $ 1,408,000

Blessed Rock of El Monte El Monte,
California 2,511,000 2,511,000 3,841,000 9,289,000 279,000 9,010,000

Broadway Apartments, Hobbs,
Limited Partnership New Mexico 2,004,000 1,931,000 1,402,000 3,334,000 156,000 3,178,000

Cascade Pines, L.P. II Atlanta,
Georgia 1,347,000 1,347,000 8,023,000 8,392,000 706,000 7,686,000

Curtis Associates I, L.P. Curtis,
Nebraska 88,000 66,000 427,000 497,000 44,000 453,000

Escatawpa Village Escatawpa,
Associates, Limited Mississippi 249,000 249,000 898,000 1,417,000 100,000 1,317,000
Partnership

Evergreen Apartments I Tulsa,
Limited Partnership Oklahoma 549,000 549,000 652,000 1,886,000 199,000 1,687,000

Hastings Apartments I, Hastings,
Limited Partnership Nebraska 542,000 542,000 611,000 1,335,000 106,000 1,229,000

Heritage Apartments I, Berkeley,
L.P. Missouri 752,000 752,000 694,000 1,679,000 80,000 1,599,000

38

WNC Housing Tax Credit Fund V, L.P., Series 3
Schedule III
Real Estate Owned by Local Limited Partnerships
December 31, 1998

-------------------------------------------------------------------------------------------
As of December 31, 1998
-------------------------------------------------------------------------------------------
Partnership's Total Amount of Encumbrances of Net
Investment in Local Investment Local Limited Property and Accumulated Book
Partnership Name Location Limited Partnerships Paid to Date Partnerships Equipment Depreciation Value
- ------------------------------------------------------------------------------------------------------------------------------------

Hillcrest Associates, a Ontario,
Limited Partnership Oregon 354,000 354,000 1,301,000 1,697,000 198,000 1,499,000

Patten Towers, L.P. II Chattanooga,
Tennessee 2,154,000 2,154,000 7,275,000 10,715,000 1,095,000 9,620,000

Prairieland Properties Syracuse,
of Syracuse II, L.P. Kansas 85,000 85,000 294,000 511,000 37,000 474,000

Raymond S. King Greensboro,
Apartments North Carolina 437,000 437,000 782,000 1,096,000 84,000 1,012,000
Limited
Partnership

Rosedale Limited Silver City,
Partnership New Mexico 309,000 309,000 1,324,000 1,679,000 193,000 1,486,000

Shepherd South Shepherd,
Apartments I, Ltd. Texas 121,000 121,000 577,000 720,000 57,000 663,000

Solomon Associates I, Solomon,
L.P. Kansas 138,000 138,000 569,000 716,000 68,000 648,000

Talladega County Talladega,
Housing Ltd. Alabama 653,000 653,000 811,000 1,466,000 112,000 1,354,000

The Willows Apartments Morganton, North
Limited Partnership Carolina 841,000 841,000 1,122,000 1,905,000 102,000 1,803,000
---------- ---------- ---------- ---------- --------- ----------
$ 13,738,000 $ 13,643,000 $ 31,218,000 $ 49,883,000 $ 3,757,000 $ 46,126,000
========== ========== ========== ========== ========= ==========

39

WNC Housing Tax Credit Fund V, L.P., Series 3
Schedule III
Real Estate Owned by Local Limited Partnerships
December 31, 1998

---------------------------------------------------------------------------------
For the year ended December 31, 1998
---------------------------------------------------------------------------------
Year Estimated
Investment Useful Life
Partnership Name Rental Income Net Loss Status Acquired (Years)
- --------------------------------------------------------------------------------------------------------------------------

Alliance Apartments I Limited
Partnership $ 65,000 $ (64,000) Completed 1997 40

Blessed Rock of El Monte 656,000 (111,000) Completed 1997 40

Broadway Apartments, Limited
Partnership 152,000 (285,000) Completed 1997 40

Cascade Pines, L.P. II 1,821,000 (152,000) Completed 1997 40

Curtis Associates I, L.P. 30,000 (24,000) Completed 1997 27.5

Escatawpa Village Associates, Limited
Partnership 119,000 (25,000) Completed 1997 27.5

Evergreen Apartments I Limited
Partnership 174,000 (224,000) Completed 1996 40

Hastings Apartments I, Limited
Partnership 83,000 (59,000) Completed 1996 40

Heritage Apartments I, L.P. 102,000 (45,000) Completed 1997 27.5

Hillcrest Associates, A Limited
Partnership 188,000 (37,000) Completed 1997 27.5

Patten Towers, L.P. II 1,483,000 (38,000) Completed 1996 27.5

Prairieland Properties of Syracuse
II, L.P. 51,000 (9,000) Completed 1997 27.5

Raymond S. King Apartments Limited
Partnership 65,000 (32,000) Completed 1997 30

Rosedale Limited Partnership 135,000 (47,000) Completed 1997 30

Shepherd South Apartments I, Ltd. 87,000 (4,000) Completed 1996 40

Solomon Associates I, L.P. 92,000 (27,000) Completed 1997 27.5

Talladega County Housing Ltd. 86,000 (41,000) Completed 1996 40

The Willows Apartments Limited
Partnership 112,000 (19,000) Completed 1997 40
------------ ----------
$ 5,501,000 $ (1,243,000)
============ ==========

40

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

WNC HOUSING TAX CREDIT FUND V, L.P., SERIES 3

By: WNC & Associates, Inc. General Partner

By: /s/ John B. Lester, Jr.
John B. Lester, Jr.,
President of WNC & Associates, Inc.

Date: _______, 1999

By: /s/ Michael L. Dickenson
Michael L. Dickenson,
Vice-President - Chief Financial Officer of WNC & Associates, Inc.

Date: _______, 1999

By: /s/ Wilfred N. Cooper, Sr.
Wilfred N. Cooper, Sr., General Partner

Date: _______, 1999

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the registrant and
in the capacities and on the dates indicated.

By /s/ Wilfred N. Cooper, Sr.
Wilfred N. Cooper, Sr., Chairman of the Board of WNC & Associates, Inc.

Date: _______, 1999

By: /s/ John B. Lester, Jr.
John B. Lester, Jr., Director of WNC & Associates, Inc.

Date: _______, 1999

By: /s/ David N. Shafer
David N Shafer, Director of WNC & Associates, Inc.

Date: _______, 1999

41