Item 2.02. Results of Operations and Financial Condition.
On February 12, 2009, we issued a press release announcing that we had completed
our consolidated financial statements as of December 31, 2006 and our restated
financial statements as of December 31, 2005 and 2004. The press release
included a summary of the information in those financial statements and a
summary of the changes made by the restatement of our 2005 and 2004 consolidated
financial statements are attached to that press release.
The financial statements and some information about them and about our internal
control over financial accounting are being furnished under item 7.01 and as
Exhibit 99.2 to this Report on Form 8-K.
More complete information, including a Management's Discussion and Analysis of
Financial Condition and Results of Operations and a Discussion of Internal
Control over Financial Reporting, will appear in our Annual Report on Form 10-K
for the year ended December 31, 2006, which we will file as promptly as
practicable.
As is noted in the press release and in the financial statements, the balance
sheet as of December 31, 2006 does not reflect the effect of changes in market
conditions since December 31, 2006 on the values of assets reflected on that
balance sheet. However, certain events and activities subsequent to December 31,
2006 are discussed in Note 22 to the financial statements.
Item 7.01 Regulation FD Disclosure
The Notes that are part of our consolidated financial statements at December 31,
2006 and our restated consolidated financial statements at December 31, 2005 and
2004 include disclosures relating to our current liquidity issues and the
substantial reduction in our current business activities that have led to our
independent registered public accountants' including in their report on those
financial statements an explanatory paragraph stating that there is substantial
doubt relating to our ability to continue as a going concern.
Management did not complete its assessment of the effectiveness of the Company's
internal control over financial reporting as of December 31, 2006, as required
by Section 404(a) of the Sarbanes-Oxley Act of 2002. Management did, however,
identify material weaknesses in internal control over financial reporting
existing as of December 31, 2006. These material weaknesses in internal control
over financial reporting related to, among other items, an ineffective
company-wide control environment, the inability to prepare accurate and timely
financial information, our internal audit function, missing or ineffective
controls associated with the identification of, and accounting for, certain
transactions in accordance with U.S. generally accepted accounting principles,
such as consolidation of entities in which we own a minority interest, tax
credit equity accounting and the application of fair value accounting. Because
of these material weaknesses, which will be described in more detail in the
Company's 2006 Form 10-K, the Company did not maintain effective internal
control over financial reporting as of December 31, 2006, based on the Internal
Control - Integrated Framework issued by COSO. Further, had management completed
its assessment, additional material weaknesses in internal control over
financial reporting as of December 31, 2006 might have been identified. In
addition, management identified material weaknesses in connection with the
preparation of the financial statements described above.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
99.1 - Press release dated February 12, 2009
99.2 - Consolidated financial statements of Municipal Mortgage & Equity, LLC as
of and for the years ended December 31, 2006, 2005 and 2004.
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