balance sheet, page-4

Hi,

I'm not an accountant, but here goes. When they receive money through a loan, it gets recorded as a liability and also an asset (cash). The cash can be used be used for normal business purposes; e.g. pay down bank-debt, fund new projects, etc. The only reason that I mentioned that it was different from "usual" debt, is that I suspect that they do not pay interest on these loans.

The company earns its income through the deferred management fees and it also shares in any capital gains each time a property is sold. Consequently, much of their income is deferred. This may mean that they will not have steady income stream until most of their properties have matured. All this is guess work on my part,however.

Regarding the other balance sheet issues - I noticed these too, but do have any particular insights into them.