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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2003
( ) TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission File Number: 33-62526
COMMONWEALTH INCOME & GROWTH FUND IV
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Pennsylvania 23-3080409
- ------------------------------- ----------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
470 John Young Way Suite 300
Exton, PA 19341
-------------------------------------------------------------
(Address, including zip code, of principal executive offices)
(610) 594-9600
------------------------------
(Registrant's telephone number
including area code)
Indicate by check mark whether the registrant (i) 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, and (III) has been subject to such filing
requirements for the past 90 days:
YES [X] NO [ ]
Commonwealth Income & Growth Fund IV
Balance Sheets
March 31, December 31,
2003 2002
-----------------------------------------------
(unaudited)
Assets
Cash and cash equivalents $ 1,846,671 $ 510,780
Lease income receivable 2,438 30,957
Accounts receivables - Commonwealth Capital Corp 123,923 -
Accounts receivables - affiliated partnerships 24,141 6,000
Receivables from sales of equipment 103,610 103,610
Deposits 1,130 -
-----------------------------------------------
2,101,913 651,347
-----------------------------------------------
Computer equipment, at cost 3,096,672 2,110,606
Accumulated depreciation (279,479) (92,931)
-----------------------------------------------
2,817,193 2,017,675
-----------------------------------------------
Equipment acquisition costs and deferred expenses, net 116,891 79,672
Prepaid acquisition fees 101,500 33,905
-----------------------------------------------
218,391 113,577
-----------------------------------------------
Total assets $ 5,137,497 $ 2,782,599
===============================================
Liabilities and Partners' Capital
Liabilities
Accounts payable $ 77,321 $ 20,486
Accounts payable - General Partner 18,588 806
Accounts payable - Commonwealth Capital Corp. - 61,807
Unearned lease income 50,263 6,514
Notes payable 742,584 -
-----------------------------------------------
Total liabilities 888,756 89,613
-----------------------------------------------
Partners' Capital
General partner 1,000 1,000
Limited partners 4,247,741 2,691,986
-----------------------------------------------
Total partners' capital 4,248,741 2,692,986
-----------------------------------------------
Total liabilities and partners' capital $ 5,137,497 $ 2,782,599
===============================================
see accompanying notes to financial statements
Commonwealth Income & Growth Fund IV
Statement of Operations
Three months ended
March 31, 2003
(unaudited)
----------------------
Income
Lease $ 270,255
Interest and other 1,587
---------------------
Total income 271,842
---------------------
Expenses
Operating, excluding depreciation 238,056
Organizational costs 22,067
Equipment management fee - General Partner 13,513
Interest 10,442
Depreciation 186,548
Amortization of equipment
acquisition costs and deferred expenses 10,747
---------------------
Total expenses 481,373
---------------------
Net (loss) $ (209,531)
=====================
Net (loss) per equivalent limited
partnership unit $ (0.94)
=====================
Weighted average number of equivalent limited
partnership units outstanding during the period 222,915
=====================
(1) Although the Partnership was formed on May 15, 2001, the Fund did not
commence operations until July 8, 2002.
see accompanying notes to financial statements
Commonwealth Income & Growth Fund IV
Statements of Partners' Capital
For the Three Months ended March 31, 2003
(unaudited)
General Limited
Partner Partner General Limited
Units Units Partner Partner Total
------------------------------------------------------------------------------------------
Partners' capital - December 31, 2002 50 181,566 $ 1,000 $ 2,691,986 $ 2,692,986
Contributions 105,082 2,101,649 2,101,649
Offering costs (231,843) (231,843)
Net income (loss) 1,045 (210,576) (209,531)
Distributions (1,045) (103,475) (104,520)
------------------------------------------------------------------------------------------
Partners' capital - March 31, 2003 50 286,648 $ 1,000 $ 4,247,741 $ 4,248,741
==========================================================================================
see accompanying notes to financial statements
Commonwealth Income & Growth Fund IV
Statement of Cash Flow
For the Three Months Ended March 31, 2003
2003
------------------------
(unaudited)
Operating activities
Net (loss) $ (209,531)
Adjustments to reconcile net (loss) to net cash
(used in) operating activities
Depreciation and amortization 197,295
Other noncash activities included in
determination of net (loss) (73,420)
Changes in assets and liabilities
(Increase) decrease in assets
Lease income receivable 28,519
Accounts receivable - affiliated partnerships (18,141)
Deposits (1,130)
(Decrease) increase in liabilities
Accounts payable 56,835
Accounts payable, Commonwealth Capital Corp (61,807)
Accounts payable, General Partner 17,782
Unearned lease income 43,749
------------------------
Net cash (used in) operating activities (19,849)
------------------------
Investing activities:
Capital expenditures (170,062)
Prepaid acquisition fees (67,595)
Equipment acquisition fees paid to General Partner (39,806)
------------------------
Net cash (used in) investing activities (277,463)
------------------------
Financing activities:
Contributions 2,101,649
Offering costs (231,843)
Distributions to partners (104,520)
Accounts receivable - Commonwealth Capital Corp (123,923)
Debt placement fees paid to the General Partner (8,160)
------------------------
Net cash provided by financing activities 1,633,203
------------------------
Net increase in cash and equivalents 1,335,891
Cash and cash equivalents, beginning of period 510,780
------------------------
Cash and cash equivalents, end of period $ 1,846,671
========================
(1) Although the Partnership was formed on May 15, 2001, the Fund did not
commence operations until July 8, 2002.
see accompanying notes to financial statements
NOTES TO FINANCIAL STATEMENTS
1. Business Commonwealth Income & Growth Fund IV (the
"Partnership") is a limited partnership
organized in the Commonwealth of Pennsylvania
on May 15, 2001. The Partnership is offering
for sale up to 750,000 units of the limited
partnership at the purchase price of $20 per
unit (the "Offering"). The Partnership
reached the minimum amount in escrow and
commenced operations on July 8, 2002. As of
March 31, 2003, the Partnership has received
$5,728,203 in contributions from limited
partners, amounting to 286,648 units. For the
quarter ended March 31, 2003, the Partnership
has received $2,101,649 in contributions from
limited partners, amounting to 105,082 units.
As of March 31, 2003, there was $363,060 in
contributions from limited partners,
amounting to 18,153 units, which remained in
our escrow account. This amount was withdrawn
from the escrow agent and contributed to the
Partnership on April 1, 2003.
The Partnership uses the proceeds of the
Offering to acquire, own and lease various
types of computer peripheral equipment and
other similar capital equipment, which will
be leased primarily to U.S. corporations and
institutions. Commonwealth Capital Corp, on
behalf of the Partnership and other
affiliated partnerships, will acquire
computer equipment subject to associated debt
obligations and lease agreements and allocate
a participation in the cost, debt and lease
revenue to the various partnerships based on
certain risk factors.
The Partnership's General Partner is
Commonwealth Income & Growth Fund, Inc. (the
"General Partner"), a Pennsylvania
corporation which is an indirect wholly owned
subsidiary of Commonwealth Capital Corp.
Commonwealth Capital Corp. is a member of the
Investment Program Association (IPA),
Financial Planning Association (FPA), and the
Equipment Leasing Association (ELA).
Approximately ten years after the
commencement of operations, the Partnership
intends to sell or otherwise dispose of all
of its computer equipment, make final
distributions to partners, and to dissolve.
Unless sooner terminated, the Partnership
will continue until December 31, 2012.
2. Summary of Basis of Presentation
Significant
Accounting The financial information presented as of any
Policies date other than December 31 has been prepared
from the books and records without audit.
Financial information as of December 31 has
been derived from the audited financial
statements of the Partnership, but does not
include all disclosures required by generally
accepted accounting principles. In the
opinion of management, all adjustments,
consisting only of normal recurring
adjustments, necessary for a fair
presentation of the financial information for
the periods indicated have been included. For
further information regarding the
Partnership's accounting policies, refer to
the financial statements and related notes
included in the Partnership's annual report
on Form 10-K for the year ended December 31,
2002. Operating results for the three-month
period ended March 31, 2003 are not
necessarily indicative of financial results
that may be expected for the full year ended
December 31, 2002.
Revenue Recognition
Through March 31, 2003, the Partnership has
only entered into operating leases. Lease
revenue is recognized on a monthly basis in
accordance with the terms of the operating
lease agreements.
The Partnership reviews a customer's credit
history before extending credit and may
establish a provision for uncollectible
accounts receivable based upon the credit
risk of specific customers, historical trends
and other information.
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 differ from
those estimates.
Long-Lived Assets
The Partnership evaluates its long-lived
assets when events or circumstances indicate
that the value of the asset may not be
recoverable. The Partnership determines
whether an impairment exists by estimating
the undiscounted cash flows to be generated
by each asset. If the estimated undiscounted
cash flows are less than the carrying value
of the asset then an impairment exists. The
amount of the impairment is determined based
on the difference between the carrying value
and the fair value. The fair value is
determined based on estimated discounted cash
flows to be generated by the asset. As of
March 31, 2003, there is no impairment.
Depreciation on computer equipment for
financial statement purposes is based on the
straight-line method over estimated useful
lives of four years.
Intangible Assets
Equipment acquisition costs and deferred
expenses are amortized on a straight-line
basis over two- to-four year lives.
Unamortized acquisition fees and deferred
expenses are charged to amortization expense
when the associated leased equipment is sold.
Cash and Cash Equivalents
The Partnership considers all highly liquid
investments with a maturity of three months
or less to be cash equivalents. Cash
equivalents have been invested in a money
market fund investing directly in Treasury
obligations.
Income Taxes
The Partnership is not subject to federal
income taxes; instead, any taxable income
(loss) is passed through to the partners and
included on their respective income tax
returns.
Taxable income differs from financial
statement net income as a result of reporting
certain income and expense items for tax
purposes in periods other than those used for
financial statement purposes, principally
relating to depreciation, amortization, and
lease income.
Offering Costs
Offering costs are payments for selling
commissions, dealer manager fees,
professional fees and other offering expenses
relating to the syndication. Selling
commissions are 8% of the partners'
contributed capital and dealer manager fees
are 1% of the partners' contributed capital.
These costs have been deducted from
partnership capital in the accompanying
financial statements.
Net Income (Loss) Per Equivalent Limited
Partnership Unit
The net income (loss) per equivalent limited
partnership unit is computed based upon net
income (loss) allocated to the limited
partners and the weighted average number of
equivalent units outstanding during the
period.
Reimbursable Expenses
Reimbursable expenses, which are charged to
the Partnership by CCC in connection with the
administration and operation of the
Partnership, are allocated to the Partnership
based upon several factors including, but not
limited to, the number of investors,
compliance issues, and the number of existing
leases.
3. Computer The Partnership is the lessor of equipment
Equipment under operating leases with periods ranging
from 16 to 36 months. In general, the lessee
pays associated costs such as repairs and
maintenance, insurance and property taxes.
The Partnership's share of the computer
equipment in which they participate at March
31, 2003 was approximately $8,000, which is
included in the Partnership's fixed assets on
their balance sheet, and the total cost of
the equipment shared by the Partnership with
other partnerships at March 31, 2003 was
approximately $48,000. The Partnership did
not participate in shared equipment as of
December 31, 2002.
The following is a schedule of future minimum
rentals on noncancellable operating leases at
March 31, 2003:
Amount
------------------------------------------------------------------------
Nine Months ended December 31, 2003 $ 1,035,000
Year Ended December 31, 2004 1,019,000
Year Ended December 31, 2005 851,000
Year Ended December 31, 2006 115,000
----------------
$ 3,020,000
========================================================================
4. Related Party
Transactions
Other Receivables
During the quarter ended March 31, 2003, the
Partnership made a non-interest bearing
advance to CCC, a related party to the
Partnership, in the amount of approximately
$124,000. This advance, as well as future
advances, was and will be made at the
discretion of the General Partner. CCC,
through its indirect subsidiaries, including
the General Partner of the Partnership,
earns fees based on revenues and new lease
purchases from this fund. CCC intends to
repay, through acquisition and debt
placement fees.
5. Notes Payable Notes payable consisted of the following:
March 31, December 31,
2003 2002
----------------------------------------------------------------------------------
Installment notes payable to banks; interest
ranging from 5.75% to 7.75%, due in monthly
installments ranging from $60 to $1,980,
including interest, with final payments due from
June through December 2004. $ 100,550 $ -
Installment notes payable to banks; interest
ranging from 5.50% to 6.75%, due in monthly
installments ranging from $151 to $4,212,
including interest, with final payments due from
January through December 2005. 576,202 -
Installment notes payable to banks; interest
ranging from 5.50% to 6.50%, due in monthly
installments ranging from $155 to $1,445,
including interest, with final payments due in
January 2006. 65,832 -
----------------------------------------
$ 742,584 $ -
==================================================================================
These notes are secured by specific computer
equipment and are nonrecourse liabilities of
the Partnership. Aggregate maturities of
notes payable for each of the periods
subsequent to March 31, 2003 are as follows:
Amount
------------
Nine months ended December 31, 2003 $ 254,781
Year ended December 31, 2004 341,539
Year ended December 31, 2005 144,174
Year ended December 31, 2006 2,090
-------------
$ 742,584
-------------
6. Supplemental Other noncash activities included in the
Cash Flow determination of net loss are as follows:
Information
Three months ended March 31, 2003
- --------------------------------------------------------------------------
Lease income, net of interest expense on
notes payable realized as a result of
direct payment of principal by lessee to bank $ 73,420
No interest or principal on notes payable was paid by the Partnership
because direct payment was made by lessee to the bank in lieu of
collection of lease income and payment of interest and principal by
the Partnership.
Noncash investing and financing activities include the following:
Three months ended March 31, 2003
- ---------------------------------------------------------------------------
Debt assumed in connection with purchase
of computer equipment $ 816,000
===========================================================================
Item 2: Management's Discussion and Analysis of Financial Condition and Results
of Operations
CRITICAL ACCOUNTING POLICIES
Financial Reporting Release No. 60, which was released by the Securities and
Exchange Commission, requires all companies to include a discussion of critical
accounting policies or methods used in the preparation of financial statements.
Our significant accounting policies are described in Note 1 of the Notes to the
Financial Statements. The significant accounting policies that we believe are
the most critical to aid in fully understanding our reported financial results
include the following:
COMPUTER EQUIPMENT
Commonwealth Capital Corp, on behalf of the Partnership and other affiliated
partnerships, acquires computer equipment subject to associated debt obligations
and lease revenue and allocates a participation in the cost, debt and lease
revenue to the various partnerships based on certain risk factors.
The Partnership will acquire equipment with no associated debt obligations with
the original contributions. The Partnership plans on acquiring equipment leases
with associated debt obligations from the monthly rental payments associated
with the equipment acquired with its original capital contributions.
REVENUE RECOGNITION
Through March 31, 2003, the Partnership has only entered into operating leases.
Lease revenue is recognized on a monthly basis in accordance with the terms of
the operating lease agreements.
The Partnership reviews a customer's credit history extending credit and
establishes provisions for uncollectible accounts based upon the credit risk of
specific customers, historical trends and other information.
LONG-LIVED ASSETS
The Partnership evaluates its long-lived assets when events or circumstances
indicate that the value of the asset may not be recoverable. The Partnership
determines whether an impairment exists by estimating the undiscounted cash
flows to be generated by each asset. If the estimated undiscounted cash flows
are less than the carrying value of the asset then an impairment exists. The
amount of the impairment is determined based on the difference between the
carrying value and the fair value. Fair value is determined based on estimated
discounted cash flows to be generated by the asset. Depreciation on computer
equipment for financial statement purposes is based on the straight-line method
over estimated useful lives of four years.
Liquidity and Capital Resources
The Partnership's primary source of capital for the period ended March 31, 2003
was contributions of approximately $2,102,000. The primary uses of cash for the
three months ended March 31, 2003 were for capital expenditures of new equipment
totaling $170,000, offering costs of approximately $232,000, payment of an
advance made by the Partnership to CCC, a related party to the Partnership, of
approximately $124,000 and payments of preferred distributions to partners of
approximately $105,000.
For the three month period ended March 31, 2003, the Partnership used cash flows
from operating activities of $20,000, which includes a net loss of $210,000,
depreciation and amortization expenses of $197,000. Other noncash activities
included in the determination of net income include direct payments of lease
income by lessees to banks of $73,000.
Cash is invested in money market accounts that invest directly in treasury
obligations pending the Partnership's use of such funds to purchase additional
computer equipment, to pay Partnership expenses or to make distributions to the
Partners. At March 31, 2003, the Partnership had approximately $1,464,000
invested in these money market accounts.
The Partnership's investment strategy of acquiring computer equipment and
generally leasing it under "triple-net leases" to operators who generally meet
specified financial standards minimizes the Partnership's operating expenses. As
of March 31, 2003, the Partnership had future minimum rentals on non-cancelable
operating leases of $1,035,000 for the balance of the year ending December 31,
2003 and $1,985,000 thereafter. At March 31, 2003, the outstanding debt was
$743,000, with interest rates ranging from 5.50% to 7.75%, and will be payable
through January 2006.
At March 31, 2003, the Partnership has a receivable from CCC, a related party to
the Partnership, in the amount of approximately $124,000. CCC, thru its indirect
subsidiaries, including the General Partner of the Partnership, earns fees based
on revenues and new lease purchases from this fund and other funds. This is a
non-interest bearing receivable. CCC intends to repay, through acquisition and
debt placement fees.
The Partnership's cash from operations is expected to continue to be adequate to
cover all operating expenses, liabilities, and preferred distributions to
Partners during the next 12-month period. If available Cash Flow or Net
Disposition Proceeds are insufficient to cover the Partnership expenses and
liabilities on a short and long term basis, the Partnership will attempt to
obtain additional funds by disposing of or refinancing Equipment, or by
borrowing within its permissible limits. The Partnership may, from time to time,
reduce the distributions to its Partners if it deems necessary. Since the
Partnership's leases are on a "triple-net" basis, no reserve for maintenance and
repairs are deemed necessary.
The Partnership's share of the computer equipment in which they participate at
March 31, 2003 was approximately $8,000, which is included in the Partnership's
fixed assets on their balance sheet, and the total cost of the equipment shared
by the Partnership with other partnerships at March 31, 2003 was approximately
$48,000. The Partnership did not participate in shared equipment as of December
31, 2002.
Results of Operations
Three Months Ended March 31, 2003
---------------------------------
For the period ended March 31, 2003, the Partnership recognized income of
$272,000 and expenses of $482,000, resulting in a net loss of $210,000.
Lease income was approximately $270,000 for the quarter ended March 31, 2003.
The Partnership has entered into approximately 75 leases through the period
ended March 31, 2003
Operating expenses of approximately $238,000, excluding depreciation, primarily
consist of professional fees of approximately $33,000, outside service fees of
approximately $11,000 and reimbursement of expenses to CCC for administration
and operation of the Partnership of approximately $51,000.
Organizational costs were approximately $22,000 for the period ended March 31,
2003.
The equipment management fee is approximately 5% of the gross lease revenue
attributable to equipment that is subject to operating leases. The equipment
management fee is approximately $14,000 for the period ended March 31, 2003.
Depreciation and amortization expenses consist of depreciation on computer
equipment and amortization of equipment acquisition fees. The expenses totaled
approximately $197,000 for the period ended March 31, 2003.
RECENT ACCOUNTING PRONOUNCEMENTS
Interpretation No. 46
In January 2003, FASB issued Interpretation No. 46, "Consolidation of Variable
Interest Entities" ("Interpretation No. 46"), which clarifies the application of
Accounting Research Bulletin No. 51, "Consolidated Financial Statements," to
certain entities in which equity investors do not have the characteristics of a
controlling financial interest or do not have sufficient equity at risk for the
entity to finance its activities without additional subordinated financial
support from the other parties. Interpretation No. 46 is applicable immediately
for variable interest entities created after January 31, 2003. For variable
interest entities created prior to January 31, 2003, the provisions of
Interpretation No. 46 are applicable no later than July 1, 2003. The Partnership
does not expect Interpretation No. 46 to have an effect on the financial
statements.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Inapplicable
Item 4. Controls and Procedures
The Chief Executive Officer and a Financial Officer of the Partnership have
conducted a review of the Partnership's disclosure controls and procedures as of
March 31, 2003.
The Partnership's disclosure controls and procedures include the Partnership's
controls and other procedures designed to ensure that information required to be
disclosed in this and other reports filed under the Securities Exchange Act of
1934, as amended (the " Exchange Act") is accumulated and communicated to the
Partnership's management, including its chief executive officer and a financial
officer, to allow timely decisions regarding required disclosure and to ensure
that such information is recorded, processed, summarized and reported with the
required time periods.
Based upon this review, the Partnership's Chief Executive Officer and a
Financial Officer have concluded that the Partnership's disclosure controls (as
defined in pursuant to Rule 13a-14 c promulgated under the Exchange Act) are
sufficiently effective to ensure that the information required to be disclosed
by the Partnership in the reports it files under the Exchange Act is recorded,
processed, summarized and reported with adequate timeliness.
Part II: OTHER INFORMATION
Commonwealth Income & Growth Fund IV
Item 1. Legal Proceedings.
Inapplicable
Item 2. Changes in Securities.
Inapplicable
Item 3. Defaults Upon Senior Securities.
Inapplicable
Item 4. Submission of Matters to a Vote of Securities Holders.
Inapplicable
Item 5. Other Information.
Inapplicable
Item 6. Exhibits and Reports on Form 8-K.
a) Exhibits:
99.1 SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
99.2 SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
COMMONWEALTH INCOME & GROWTH
FUND IV
BY: COMMONWEALTH INCOME &
GROWTH FUND, INC. General Partner
May 15, 2003 By: George S. Springsteen
- ------------ ----------------------
Date George S. Springsteen
President
Certifications
I, George Springsteen, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Commonwealth Income &
Growth Fund IV, (the Registrant);
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
Registrant as of, and for, the periods presented in this quarterly report;
4. The Registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the Registrant and we have:
a) designed such disclosure controls and procedures to ensure the
material information relating to the Registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this quarterly report
is being prepared;
b) evaluated the effectiveness of the Registrant's disclosure controls
and procedures as of a date within 90 days prior to the filing date of
this quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and the procedures based on
our evaluation as of the Evaluation Date;
5. The Registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the Registrant's auditors and the audit committee of
the Registrant's board of directors (or persons performing the equivalent
function):
a) all significant deficiencies in the design or the operation of
internal controls which could adversely affect the Registrant's ability
to record, process, summarize and report financial data we have
identified for the Registrant's auditors any material weakness in
internal controls; and
b) any fraud, whether or not material, that involves management or
other employees who have a significant role in the Registrant's
internal controls; and
6. The Registrant's other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
George S. Springsteen
- ----------------------
George S. Springsteen
Chief Executive Officer
May 15, 2003
I, Kimberly A. Springsteen, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Commonwealth Income &
Growth Fund IV, (the Registrant);
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
Registrant as of, and for, the periods presented in this quarterly report;
4. The Registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the Registrant and we have:
a) designed such disclosure controls and procedures to ensure the
material information relating to the Registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this quarterly report
is being prepared;
b) evaluated the effectiveness of the Registrant's disclosure controls
and procedures as of a date within 90 days prior to the filing date of
this quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and the procedures based on
our evaluation as of the Evaluation Date;
5. The Registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the Registrant's auditors and the audit committee of
the Registrant's board of directors (or persons performing the equivalent
function):
a) all significant deficiencies in the design or the operation of
internal controls which could adversely affect the Registrant's ability
to record, process, summarize and report financial data we have
identified for the Registrant's auditors any material weakness in
internal controls; and
b) any fraud, whether or not material, that involves management or
other employees who have a significant role in the Registrant's
internal controls; and
6. The Registrant's other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
Kimberly A. Springsteen
- ------------------------
Kimberly A. Springsteen
Principal Financial Officer
May 15, 2003