Investment Research Associates - Page 528




                                       - 570 -                                         
          Hargens or to collect on the note, nor was any persuasive                    
          evidence presented to show that this note became worthless in                
          1987.                                                                        
               With respect to the note receivable from Cedilla Invest.,               
          Kanter testified that "It had no assets, as best I recall, that              
          could be assessed effectively to recoup this note".  This                    
          statement is not sufficient evidence to establish that the                   
          alleged note became worthless in 1987.  It lacks any foundation              
          in Kanter's personal knowledge of Cedilla Invest.'s assets.  In              
          addition, the balance sheets of Cedilla Invest. included in IRA's            
          1986 to 1989 tax returns show that Cedilla Invest. had total                 
          assets of $10,008,632, $526,374, $526,374, and $575,896 at                   
          December 31, 1986, 1987, 1988, and 1989, respectively.  IRA                  
          presented no evidence that the fair market value of these assets             
          was less than the liabilities of Cedilla Invest.  IRA's returns              
          also show that Cedilla Invest. earned total income in the amounts            
          of $443,762, $52,656, and $11,702 for 1987, 1988, and 1989,                  
          respectively.  These returns indicate that Cedilla Invest. had               
          assets with which to pay the alleged note receivable, that                   
          Cedilla Invest. continued to be a going concern after 1987, and,             
          therefore, that the Cedilla Invest. note had current liquidating             
          value or potential value.                                                    










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