UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q/A

[X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the Quarterly Period Ended September 30, 2003

or

[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from _______________to __________________



Commission File #0-21606

InLand Capital Fund, L.P.(Exact name of registrant as specified in its charter)







|Delaware                          | #36-3767977                            
|--------------------------------- | ---------------------------------------
|(State or other jurisdiction      | (I.R.S. Employer Identification Number)
|of incorporation or organization) |                                        

|2901 Butterfield Road, Oak Brook, Illinois | 60523     
|------------------------------------------ | ----------
|(Address of principal executive office)    | (Zip Code)

Registrant's telephone number, including area code:  630-218-8000
_______________N/A_______________(Former name, former address and former fiscal
year, if changed since last report)

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 a checkmark whether the registrant is an accelerated filer (as defined in Securities Exchange Act Rule 12b-2)    Yes    No X





INLAND CAPITAL FUND, L.P.
(a limited partnership)
Balance Sheets
September 30, 2003 and December 31, 2002
(unaudited)Assets

|                                                                                                                                                                                       |   | 2003       | 2002      
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | - | ---------- | ----------
|Current assets:                                                                                                                                                                        |   |            |           
|Cash and cash equivalents                                                                                                                                                              | $ | 9,040,475  | 1,284,069 
|Accrued interest and other receivables (net of allowance for 
    doubtful accounts of $62,289 at September 30, 2003 and
    December 31, 2002) (Note 5)                               |   | 204,568    | 102,154   
|Current portion of mortgage loans receivable (net of allowance for
    doubtful accounts of $90,000 at September 30, 2003 and 
    December 31, 2002) (Note 5)                         |   | 71,135     | -         
|Other current assets                                                                                                                                                                   |   | 4,680      | -         
|                                                                                                                                                                                       |   |            |           
|Total current assets                                                                                                                                                                   |   | 9,320,858  | 1,386,223 
|                                                                                                                                                                                       |   |            |           
|Other assets                                                                                                                                                                           |   | 3,074      | 3,074     
|Mortgage loan receivable, less current portion (Note 5)                                                                                                                                |   | 891,249    | 1,366,547 
|Investment properties and improvements (including acquisition fees paid   to Affiliates of $630,226 and $775,673 at September 30, 2003 and   December 31, 2002, respectively) (Note 3) |   | 15,390,702 | 18,283,928
|                                                                                                                                                                                       |   |            |           
|Total assets                                                                                                                                                                           | $ | 25,605,883 | 21,039,772





See accompanying notes to financial statements.

INLAND CAPITAL FUND, L.P.
(a limited partnership)
Balance Sheets
(continued)
September 30, 2003 and December 31, 2002
(unaudited)Liabilities and Partners' Capital

|                                                                                                                                                                                                                                         |   | 2003         | 2002        
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | - | ------------ | ------------
|Current liabilities:                                                                                                                                                                                                                     |   |              |             
|Accounts payable                                                                                                                                                                                                                         | $ | 5,136        | 15,131      
|Accrued real estate taxes                                                                                                                                                                                                                |   | 40,974       | 42,873      
|Due to Affiliates (Note 2)                                                                                                                                                                                                               |   | 26,362       | 12,228      
|Unearned income                                                                                                                                                                                                                          |   | 76,436       | 77,275      
|                                                                                                                                                                                                                                         |   |              |             
|Total current liabilities                                                                                                                                                                                                                |   | 148,908      | 147,507     
|                                                                                                                                                                                                                                         |   |              |             
|Deferred gain on sale (Note 5)                                                                                                                                                                                                           |   | 534,718      | 753,648     
|                                                                                                                                                                                                                                         |   |              |             
|Partners' capital:                                                                                                                                                                                                                       |   |              |             
|General Partner:                                                                                                                                                                                                                         |   |              |             
|Capital contribution                                                                                                                                                                                                                     |   | 500          | 500         
|Cumulative cash distributions                                                                                                                                                                                                            |   | (846,759)    | (846,759)   
|Cumulative net income                                                                                                                                                                                                                    |   | 858,247      | 858,822     
|                                                                                                                                                                                                                                         |   |              |             
|                                                                                                                                                                                                                                         |   | 11,988       | 12,563      
|                                                                                                                                                                                                                                         |   |              |             
|Limited Partners:                                                                                                                                                                                                                        |   |              |             
|Units of $1,000. Authorized 60,000 Units, 32,337 and 32,337       outstanding at September 30, 2003 and December 31, 2002 , 
      respectively (net of offering costs of $4,466,765, of which 
      $3,488,574 was paid to Affiliates) |   | 27,876,265   | 27,876,265  
|Cumulative cash distributions                                                                                                                                                                                                            |   | (21,489,004) | (21,489,004)
|Cumulative net income                                                                                                                                                                                                                    |   | 18,523,008   | 13,738,793  
|                                                                                                                                                                                                                                         |   |              |             
|                                                                                                                                                                                                                                         |   | 24,910,269   | 20,126,054  
|                                                                                                                                                                                                                                         |   |              |             
|Total Partners' capital                                                                                                                                                                                                                  |   | 24,922,257   | 20,138,617  
|                                                                                                                                                                                                                                         |   |              |             
|Total liabilities and Partners' capital                                                                                                                                                                                                  | $ | 25,605,883   | 21,039,772  





See accompanying notes to financial statements.

INLAND CAPITAL FUND, L.P.
(a limited partnership)
Statements of Operations
For the three and nine months ended September 30, 2003 and 2002
(unaudited)

|                                                                                     |   | Three months       | Three months       | Nine months        | Nine months       
|------------------------------------------------------------------------------------ | - | ------------------ | ------------------ | ------------------ | ------------------
|                                                                                     |   | ended              | ended              | ended              | ended             
|                                                                                     |   | September 30, 2003 | September 30, 2002 | September 30, 2003 | September 30, 2002
|Income:                                                                              |   |                    |                    |                    |                   
|Sale of investment property
    (Notes 1 and 3)                                      | $ | 6,553,366          | 6,275,317          | 7,877,469          | 7,042,903         
|Recognition of deferred gain on     sale of investments in land and     improvements |   | 137,732            | 24,351             | 218,930            | 622,224           
|Rental income (Note 4)                                                               |   | 43,955             | 52,200             | 130,432            | 165,322           
|Interest income                                                                      |   | 25,569             | 43,577             | 74,333             | 128,050           
|Other income                                                                         |   | 35                 | 9,739              | 3,535              | 9,798             
|                                                                                     |   |                    |                    |                    |                   
|                                                                                     |   | 6,760,657          | 6,405,184          | 8,304,699          | 7,968,297         
|                                                                                     |   |                    |                    |                    |                   
|Expenses:                                                                            |   |                    |                    |                    |                   
|Cost of investment property sold                                                     |   | 2,052,487          | 1,926,496          | 3,255,302          | 2,337,269         
|Professional services to Affiliates                                                  |   | 6,360              | 5,794              | 19,474             | 22,897            
|Professional services to non-    affiliates                                          |   | 3,932              | 3,000              | 32,607             | 30,472            
|General and administrative     expenses to Affiliates                                |   | 2,451              | 2,839              | 13,756             | 13,800            
|General and administrative     expenses to non-affiliates                            |   | 5,035              | 12,176             | 53,658             | 27,650            
|Marketing expenses to Affiliates                                                     |   | 3,968              | 4,567              | 9,618              | 11,318            
|Marketing expenses to non-    affiliates                                             |   | 13,579             | 31,197             | 35,517             | 109,027           
|Land operating expenses to     Affiliates                                            |   | 7,596              | 9,033              | 26,068             | 30,328            
|Land operating expenses to non-    affiliates                                        |   | 25,819             | 22,794             | 75,059             | 63,403            
|Bad debt expense                                                                     |   | -                  | 106,489            | -                  | 106,489           
|                                                                                     |   |                    |                    |                    |                   
|                                                                                     |   | 2,121,227          | 2,124,385          | 3,521,059          | 2,752,653         
|                                                                                     |   |                    |                    |                    |                   
|Net income                                                                           | $ | 4,639,430          | 4,280,799          | 4,783,640          | 5,215,644         

See accompanying notes to financial statements.

INLAND CAPITAL FUND, L.P.
(a limited partnership)
Statements of Operations
(continued)
For the three and nine months ended September 30, 2003 and 2002
(unaudited)

|                                                                                                                                                                                     |   | Three months       | Three months       | Nine months        | Nine months       
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | - | ------------------ | ------------------ | ------------------ | ------------------
|                                                                                                                                                                                     |   | ended              | ended              | ended              | ended             
|                                                                                                                                                                                     |   | September 30, 2003 | September 30, 2002 | September 30, 2003 | September 30, 2002
|                                                                                                                                                                                     |   |                    |                    |                    |                   
|Net income (loss) allocated to:                                                                                                                                                      |   |                    |                    |                    |                   
|General Partner                                                                                                                                                                      | $ | 8                  | (916)              | (575)              | (1,114)           
|Limited Partners                                                                                                                                                                     |   | 4,639,422          | 4,281,715          | 4,784,215          | 5,216,758         
|                                                                                                                                                                                     |   |                    |                    |                    |                   
|Net income (loss)                                                                                                                                                                    | $ | 4,639,430          | 4,280,799          | 4,783,640          | 5,215,644         
|                                                                                                                                                                                     |   |                    |                    |                    |                   
|Net income allocated to the one   General Partner Unit                                                                                                                               | $ | 8                  | (916)              | (575)              | (1,114)           
|                                                                                                                                                                                     |   |                    |                    |                    |                   
|Net income per Unit allocated to   Limited Partners per weighted   average Limited Partnership   Units of 32,337 for the three and   nine months ended September 30,   2003 and 2002 | $ | 143.47             | 132.41             | 147.95             | 161.32            



See accompanying notes to financial statements.



INLAND CAPITAL FUND, L.P.
(a limited partnership)
Statements of Cash Flows
For the nine months ended September 30, 2003 and 2002
(unaudited)

|                                                                                       |   | 2003        | 2002       
|-------------------------------------------------------------------------------------- | - | ----------- | -----------
|Cash flows from operating activities:                                                  |   |             |            
|Net income                                                                             | $ | 4,783,640   | 5,215,644  
|Adjustments to reconcile net income to net cash 
        used in operating activities: |   |             |            
|Gain on sale of investment properties                                                  |   | (4,622,167) | (4,705,634)
|Recognition of deferred gain                                                           |   | (218,930)   | (622,224)  
|Bad debt expense                                                                       |   | -           | 106,489    
|Changes in assets and liabilities:                                                     |   |             |            
|Accrued interest and other receivables                                                 |   | (102,414)   | (169,575)  
|Other current assets                                                                   |   | (4,680)     | 2,936      
|Accounts payable                                                                       |   | (9,995)     | 99         
|Accrued real estate taxes                                                              |   | (1,899)     | (17,412)   
|Due to Affiliates                                                                      |   | 14,134      | 12,704     
|Unearned income                                                                        |   | (839)       | 71,434     
|                                                                                       |   |             |            
|Net cash used in operating activities                                                  |   | (163,150)   | (105,539)  
|                                                                                       |   |             |            
|Cash flows from investing activities:                                                  |   |             |            
|Additions to investment properties                                                     |   | (362,076)   | (331,508)  
|Principle payments received                                                            |   | 404,163     | 1,135,261  
|Proceeds from sale of investment properties                                            |   | 7,877,469   | 7,042,903  
|                                                                                       |   |             |            
|Net cash provided by investing activities                                              |   | 7,919,556   | 7,846,656  
|                                                                                       |   |             |            
|Net increase in cash and cash equivalents                                              |   | 7,756,406   | 7,741,117  
|                                                                                       |   |             |            
|Cash and cash equivalents at beginning of period                                       |   | 1,284,069   | 552,394    
|                                                                                       |   |             |            
|Cash and cash equivalents at end of period                                             | $ | 9,040,475   | 8,293,511  





See accompanying notes to financial statements.



INLAND CAPITAL FUND, L.P.
(a limited partnership)
Notes to Financial Statements
September 30, 2003
(unaudited)

Readers of this Quarterly Report should refer to the Partnership's audited financial statements for the fiscal year ended December 31, 2002, which are included in the Partnership's 2002 Annual Report, as certain footnote disclosures which would substantially duplicate those contained in such audited financial statements have been omitted from this Report.



(1)  Organization and Basis of Accounting



InLand Capital Fund, L.P. (the "Partnership") was organized on June 21, 1991, pursuant to the Delaware Revised Uniform Limited Partnership Act.  On December 13, 1991, the Partnership commenced an offering of 60,000 limited partnership units or units pursuant to a Registration Statement of Form S-11 under the Securities Act of 1933. The amended and restated limited partnership agreement (the "Partnership Agreement") provides for Inland Real Estate Investment Corporation to be the general partner.  The offering terminated on August 23, 1993, after the Partnership had sold 32,399.28 units, at $1,000 per unit, resulting in $32,399,282 in gross offering proceeds, not including the general partner's capital contribution of $500.  All of the holders of these units have been admitted as limited partners to the Partnership.  The limited partners of the Partnership will share in their portion of benefits of ownership of the Partnership's real property investments according to the number of units held. As of September 30, 2003, the Partnership has repurchased and canceled a total of 62.17 units for $56,253 from various limited partners through the unit repurchase program.  Under this program, limited partners may under certain circumstances have their units repurchased for an amount equal to their original capital as reduced by distributions from net sale proceeds.



The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America 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 periods. Actual results could differ from those estimates.



In the opinion of management, the financial statements contain all the adjustments necessary to present fairly the financial position and results of operations for the period presented herein.  Results of interim periods are not necessarily indicative of results to be expected for the year.



On January 1, 2003, the Partnership adopted FASB Interpretation No. 45 ("FIN 45") "Guarantor's Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness to Others, an interpretation of FASB Statements No. 5, 57 and 107 and a rescission of FASB Interpretation No. 34. FIN 45 elaborates on the disclosures to be made by a guarantor in its interim and annual financial statements about its obligations under guarantees issued. FIN 45 also clarifies that a guarantor is required to recognize, at inception of a guarantee, a liability for the fair value of the obligation undertaken. The adoption of FIN 45 did not have a material effect on the Partnership's financial statements.

---

INLAND CAPITAL FUND, L.P.
(a limited partnership)
Notes to Financial Statements
(continued)
September 30, 2003
(unaudited)



In January 2003, FASB issued Interpretation No. 46 ("FIN 46") "Consolidation of Variable Interest Entities and Interpretation of Accounting Research Bulletin (ARB) No. 51".  The primary objectives of FIN No. 46 are to provide guidance on the identification of entities for which control is achieved through means other than through voting rights (Variable Interest Entities) and how to determine when and which business enterprise should consolidate the Variable Interest Entity (the Primary Beneficiary).  The consolidation provisions of FIN 46 apply immediately to variable interests in variable interest entities created after January 31, 2003. It applies in the first fiscal year or interim period beginning after June 15, 2003 to variable interest entities in which an enterprise that is a public company holds a variable interest that it acquired before February 1, 2003. Management of the Partnership does not anticipate that the provisions of FIN 46 will have a material impact on the Partnership's financial condition and results of operations.



In May 2003, the FASB issued Statement No. 150 ("SFAS 150") "Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity".  This statement establishes standards for classifying and measuring certain financial instruments as liabilities that embody obligations of the issuer and have characteristics of both liabilities and equity. SFAS No. 150 is effective for all financial instruments created or modified after May 31, 2003, and otherwise is effective at the beginning of the first interim period beginning after June 15, 2003. Management of the Partnership does not anticipate that the provisions of SFAS No. 150 will have an impact on the Partnership's financial condition and results of operations.



(2)  Transactions with Affiliates

The general partner and its affiliates are entitled to reimbursement for salaries and expenses of employees of the general partner and its affiliates relating to the administration of the Partnership.  Such costs are included in professional services and general and administrative expenses to affiliates, of which $8,157 and $3,205 was unpaid as of September 30, 2003 and December 31, 2002, respectively.



The general partner is entitled to receive asset management fees equal to one-quarter of 1% of the original cost to the Partnership of undeveloped land annually, limited to a cumulative total over the life of the Partnership of 2% of the land's original cost to the Partnership.  Such fees of $26,068 and $30,328 have been incurred and are included in land operating expenses to affiliates for the nine months ended September 30, 2003 and 2002, respectively, of which $7,597 and $0 was unpaid as of September 30, 2003 and December 31, 2002, respectively.

---

INLAND CAPITAL FUND, L.P.
(a limited partnership)
Notes to Financial Statements
(continued)
September 30, 2003
(unaudited)



An affiliate of the general partner performed sales marketing and advertising services for the Partnership and was reimbursed (as set forth under terms of the Partnership Agreement) for direct costs.  Such costs of $9,618 and $11,318 have been incurred and are included in marketing expenses to affiliates for the nine months ended September 30, 2003 and 2002, respectively, all of which was paid as of September 30, 2003 and December 31, 2002.



An affiliate of the general partner performed property upgrades, rezoning, annexation and other activities to prepare the Partnership's land investments for sale and was reimbursed (as set forth under terms of the Partnership Agreement) for salaries and direct costs.   The affiliate did not recognize any profit on any project.  Such costs are included in investment properties, of which $10,608 and $9,023 was unpaid at September 30, 2003 and December 31, 2002, respectively.

---

INLAND CAPITAL FUND, L.P.
(a limited partnership)
Notes to Financial Statements
(continued)

(3)  Investment Properties



|Initial Costs
|-------------
|Parcel       
|#            
|1            
|             
|             
|2            
|             
|             
|             
|             
|             
|             
|             
|3            
|             
|             
|4            
|             
|             
|             
|             
|             
|5            
|             
|             
|             
|6            
|             
|             
|             
|7            
|             
|             
|8            
|             
|9            
|             

---

INLAND CAPITAL FUND, L.P.,
(a limited partnership)
Notes to Financial Statements
(continued)

(3)  Investment Properties (continued)



|Initial Costs
|-------------
|Parcel       
|#            
|             
|10           
|             
|             
|             
|10A(a)       
|             
|             
|11           
|             
|             
|12           
|             
|             
|             
|13           
|             
|             
|             
|14           
|             
|             
|15           
|             
|16           
|             
|17           
|             
|18           
|             
|             
|             
|             

---

INLAND CAPITAL FUND, L.P.
(a limited partnership)
Notes to Financial Statements
(continued)
September 30, 2003
(unaudited)

(3) Investment Properties (continued)



1. Included in the purchase of Parcel 10 was a house and several outbuildings, located on approximately seven acres, which was sold in April 1995.
2. Reconciliation of investment properties and improvements owned:



|                         |   | September 30, | December 31,
|------------------------ | - | ------------- | ------------
|                         |   | 2003          | 2002        
|                         |   |               |             
|Balance at January 1,    | $ | 18,283,928    | 20,990,019  
|Additions during period  |   | 362,076       | 368,003     
|Sales during period      |   | (3,255,302)   | (3,074,094) 
|                         |   |               |             
|Balance at end of period | $ | 15,390,702    | 18,283,928  





(4) Farm Rental Income



The Partnership has determined that all leases relating to the farm parcels are operating leases.  Accordingly, rental income is reported when earned.



As of September 30, 2003, the Partnership had farm leases of generally one year in duration, for approximately 1,046 acres of the approximately 1,162 acres owned.



(5) Mortgage Loans Receivable

Mortgage loans receivable are the result of sales of parcels, in whole or in part.  The Partnership has recorded a deferred gain on these sales.  The deferred gain will be recognized over the life of the related mortgage loan receivable as principal payments are received.  At September 30, 2003, the fair market value of the mortgage loans receivable approximated their carrying value.

---

INLAND CAPITAL FUND, L.P.
(a limited partnership)
Notes to Financial Statements
(continued)
September 30, 2003
(unaudited)

|                                      |              |               | Principal Balance | Principal Balance | Accrued Interest Receivable | Deferred Gain
|------------------------------------- | ------------ | ------------- | ----------------- | ----------------- | --------------------------- | -------------
|Parcel                                | Maturity     | Interest Rate | 09/30/03          | 12/31/02          | 09/30/03                    | 09/30/03     
|                                      |              |               |                   |                   |                             |              
|1                                     | 12/31/04     | 7.50%         | $    891,249      | 1,143,172         | 159,240                     | 498,315      
|12                                    | 03/31/04     | 9.00%         | 161,135           | 313,375           | 62,289                      | 36,403       
|                                      |              |               | 1,052,384         | 1,456,547         | 221,529                     | 534,718      
|Less allowances for doubtful accounts | 90,000       | 90,000        | 62,289            | -                
|                                      | $    962,384 | 1,366,547     | 159,240           | 534,718          



The Partnership determined that the maximum value of Parcel 1 and 12 could be realized if the parcels were developed and sold as individual lots. However, if the Partnership had followed that plan, there is a possibility that it could have increased income taxes. Therefore, the Partnership sold the parcels to a third party developer whereby 100% of the sales price was represented by notes receivable from the buyer. These transactions were deemed installment sales. After the sale, the developer, through limited liability companies or LLCs, secured third party financing to cover the deferred down payment owed to the Partnership as well as provide proceeds to begin the development of the project.  These sales were structured so that the deferred down payment received at the time of the sale was sufficient to provide a distribution to the Limited Partners that equated to the Parcel Capital allocated to the parcel plus approximately a 6% return per annum on the Parcel Capital through the date of the distribution.

The velocity of the developer's individual home sales at Parcel 12 was slower than was originally projected and consequently, the developer's carrying costs were higher.  As a result of the slower lot sales, the net sale proceeds available to the Partnership were lower than anticipated.  As of September 30, 2003, the Partnership has recorded an allowance for doubtful accounts of $90,000 and $62,289 relating to the mortgage receivable and accrued interest receivable, respectively, relating to the sale of Parcel 12.  The related deferred gain for Parcel 12 of $45,800 has also been reserved and recorded against bad debt expense.



The General Partner guaranteed the third party development loans owed by the limited liability companies.  In reviewing the developments' financial situation, the General Partner determined that it would be in its best interest to have an affiliate acquire the interests in the LLC that owned Parcel 12. The General Partner and its affiliates concluded that they could better control the continuing costs to complete these developments and would therefore have the best opportunity to limit their exposure under the guarantee agreements and possibly recover a portion of the amount owed. An affiliate of the General Partner contributed approximately $50,000 to acquire the interests in the LLC that owned Parcel 12. The affiliate of the General Partner will complete the development and sale of the project. The Limited Partners received distributions that equated to the Parcel Capital plus approximately a 6% return per annum on the Parcel Capital through the date of the distribution.



---

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations



Certain statements in this "Management's Discussion and Analysis of Financial Condition and Results of Operations" and elsewhere in this quarterly report on Form 10-Q constitute "forward-looking statements" within the meaning of the Federal Private Securities Litigation Reform Act of 1995.  These forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the Partnership's actual results, performance, or achievements to be materially different from any future results, performance, or achievements expressed or implied by these forward-looking statements. These factors include, among other things, the ability to obtain annexation and zoning approvals required to develop our properties; the approval of local governing bodies to develop our properties; successful lobbying of local "no growth" or limited development homeowner groups; adverse changes in real estate, financing and general economic or local conditions; eminent domain proceedings; changes in the environmental conditions or changes in the environmental positions of governmental bodies; and potential conflicts of interest between us and our affiliates, including our general partner.



Critical Accounting Policies

On December 12, 2001, the Securities and Exchange Commission issued Financial Reporting Release ("FRR") No. 60 "Cautionary Advice Regarding Disclosure About Critical Accounting Policies."  A critical accounting policy is one that would materially effect our operations or financial condition, and requires management to make estimates or judgements in certain circumstances. We believe that our most critical accounting policies relate to how we value our investment properties and mortgage loans receivable and revenue recognition.  These judgements often result from the need to make estimates about the effect of matters that are inherently uncertain.  The purpose of the FRR is to provide stockholders with an understanding of how management forms these policies.  Critical accounting policies discussed in this section are not to be confused with accounting principles and methods disclosed in accordance with accounting principles generally accepted in the United States of America ("GAAP").  GAAP requires information in financial statements about accounting principles, methods used and disclosures pertaining to significant estimates.  The following disclosure discusses judgements known to management pertaining to trends, events or uncertainties known which were taken into consideration upon the application of those policies and the likelihood that materially different amounts would be reported upon taking into consideration different conditions and assumptions.

Valuation of Investment Properties - On a quarterly basis, in accordance with Statement of Financial Accounting Standards No. 144, we conduct an impairment analysis to ensure that the carrying value of each property does not exceed its estimated fair value.  If this were to occur, we would be required to record an impairment loss equal to the excess of carrying value over fair value.

In determining the value of an investment property and whether the property is impaired, management considers several factors such as projected capital expenditures and sales prices. The aforementioned factors are considered by management in determining the value of any particular property.  The value of any particular property is sensitive to the actual results of any of these uncertain factors, either individually or taken as a whole.  Should the actual results differ from management's judgement, the valuation could be negatively or positively affected.

The valuation and possible subsequent impairment of investment properties is a significant estimate that can and does change based on management's continuous process of analyzing each property.



Cost Allocation - We use the area method of cost allocation, which approximates the relative sales method of cost allocation, whereby a per acre price is used as the standard allocation method for land purchases and sales. The total cost of the parcel is divided by the total number of acres to arrive at a per acre price.

Valuation Mortgage Loans Receivable - On a quarterly basis, in accordance with Statement of Financial Accounting Standards No. 144, we conduct an impairment analysis to ensure that the carrying value of each mortgage loan receivable does not exceed its estimated fair value.  If this were to occur, we would be required to record an impairment loss equal to the excess of carrying value over fair value.

In determining the value of mortgage loans receivable, management considers projected sales proceeds available and expenses related to the property associated with the mortgage. Should the actual results differ from management's judgement, the valuation could be negatively or positively affected.

The valuation and possible subsequent allowance for doubtful accounts is a significant estimate that can and does change based on management's continuous process of analyzing each mortgage loan receivable.

Revenue Recognition - We recognize income from the sale of land parcels in accordance with Statement of Financial Accounting Standards No. 66, "Accounting for Sales of Real Estate".

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Liquidity and Capital Resources

On December 13, 1991, we commenced an offering of 60,000 limited partnership units or units at $1,000 per unit, pursuant to a Registration Statement on Form S-11 under the Securities Act of 1933.  The offering terminated on August 23, 1993, after we had sold 32,399.28 units, at $1,000 per unit, resulting in $32,399,282 in gross offering proceeds, not including the general partner's capital contribution of $500. All of the holders of these units have been admitted as limited partners to our partnership.  Our limited partners share in their portion of benefits of ownership of our real property investments according to the number of units held. As of September 30, 2003, we repurchased and canceled a total of 62.17 units for $56,253 from various limited partners through the units repurchase program.  Under this program, limited partners may under certain circumstances have their units repurchased for an amount equal to their original capital as reduced by distributions from net sale proceeds.

We used $25,945,989 of gross offering proceeds to purchase, on an all-cash basis, eighteen parcels of land and one building. These investments include the payment of the purchase price, acquisition fees and acquisition costs of such properties. We purchased one parcel during 1992, one during 1993, fifteen during 1994 and one during 1995. As of September 30, 2003, we have had multiple sales transactions through which we have disposed of a building and approximately 2,140 acres of the 3,302 acres originally owned, or approximately 65%.  As of September 30, 2003, cumulative distributions to the limited partners have totaled $21,489,004 (which represents a return of original capital).  Through September 30, 2003, we have used $5,487,801 of working capital reserve for rezoning and other activities and such amount is included in investment properties.

Our capital needs and resources will vary depending upon a number of factors, including the extent to which we conduct rezoning and other activities relating to utility access, the installation of roads, subdivision and/or annexation of land to a municipality, changes in real estate taxes affecting our land, and the amount of revenue received from leasing. As of September 30, 2003, we own, in whole or in part, nine of our original eighteen parcels, the majority of which are leased to local farmers and are generating sufficient cash flow from farm leases to cover property taxes, insurance and other miscellaneous property expenses.

At September 30, 2003, we had cash and cash equivalents of approximately $9,040,000, of which approximately $174,000 is reserved for the repurchase of units through the unit repurchase program.  The remaining approximately $8,866,000 is available to be used for our costs and liabilities, cash distributions to partners, and other costs and expenses associated with owning our land parcels. We plan to maximize our land sales effort in anticipation of rising land values.

We plan to enhance the value of our land through pre-development activities such as rezoning, annexation and land planning. We have already been successful in, or are in the process of pre-development activity on a majority of our land investments.  Parcel 2, annexed to the village of McHenry and zoned for a business park, has two phases of improvements complete and sites are being marketed to potential buyers, of which 34 of the 167 lots were sold as of September 30, 2003.  Parcel 4, zoned for a variety of business uses, has improvements underway and sites are being marketed to potential buyers, of which approximately 67 acres were sold in various transactions. Parcels 15 and 16 have been annexed to the village of Huntley and zoned for residential and commercial development. Parcel 7 and portions of Parcel 12 were annexed and zoned in the city of Plano in 2000, with sales occurring in 2001 and 2003.



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Transactions with Related Parties

Our general partner and its affiliates are entitled to reimbursement for salaries and expenses of employees of the general partner and its affiliates relating to our administration.  Such costs are included in professional services and general and administrative expenses to affiliates, of which $8,157 and $3,205 was unpaid as of September 30, 2003 and December 31, 2002, respectively.

Our general partner is entitled to receive asset management fees equal to one-quarter of 1% of the original cost of our undeveloped parcels annually, limited to a cumulative total over our life of 2% of the parcels' original cost to us.  Such fees of $26,068 and $30,328 have been incurred for the nine months ended September 30, 2003 and 2002, respectively, of which $7,597 and $0 was unpaid as of September 30, 2003 and December 31, 2002, respectively.

An affiliate of our general partner performed sales marketing and advertising services for us and was reimbursed  for direct costs. Such costs of $9,618 and $11,318 have been incurred and are included in marketing expenses to affiliates for the nine months ended September 30, 2003 and 2002, respectively, all of which was paid as of September 30, 2003 and December 31, 2002.

An affiliate of our general partner performed property upgrades, rezoning, annexation and other activities to prepare our land investments for sale and was reimbursed for salaries and direct costs. As we paid the affiliate its actual cost, the affiliate did not take a profit on any project.  Such costs are included in investment properties, of which $10,608 and $9,023 was unpaid at September 30, 2003 and December 31, 2002, respectively.



Results of Operations

As of September 30, 2003, we owned nine parcels of land consisting of approximately 1,162 acres. Of the 1,162 acres owned, approximately 1,046 acres, or approximately 90%, were tillable and leased to local farmers and were generating sufficient cash flow to cover property taxes, insurance and other miscellaneous property expenses for all parcels.

On January 11, 2002, we sold approximately 108 acres of Parcel 1 to an unaffiliated third party on an installment basis and recorded a deferred gain.  For the nine months ended September 30, 2003, we received total principal payments of $251,922 and recognized $140,855 of the deferred gain.  The remaining deferred gain of $498,315 at September 30, 2003 will be recognized as payments are received. In addition, on April 16, 2001, we sold approximately 60 acres of Parcel 12 to an unaffiliated third party on an installment basis and recorded a deferred gain. The remaining deferred gain of $36,403 at September 30, 2003 will be recognized as payments are received.

Income from the sale of investment properties and the cost of investment properties sold for the nine months ended September 30, 2003 was the result of the sale of 336 acres of Parcel 9 in April 2003, 168 acres of Parcel 7 in September 2003 and 50 acres of Parcel 12 in September 2003.  Income from the sale of investment properties and the cost of investment properties sold for the nine months ended September 30, 2002 was the result of the sale of additional lots of Parcel 2, the McHenry Business Park.

Rental income was $130,432 and $165,322 for the nine months ended September 30, 2003 and 2002, respectively. This decrease was due to the decrease in tillable acres due to land sales and pre-development activity on our land investments.  This decrease was partially offset by the annual increase in lease payments from tenants.

Interest income was $74,333 and $128,050 for the nine months ended September 30, 2003 and 2002, respectively.  This decrease results from our stopping the accrual of interest income on the mortgage loan receivable relating to Parcel 12 and from a decrease in interest income earned on the mortgage loan receivable relating to Parcel 1 as a result of principal payments received.  This decrease was partially offset by an increase in interest income earned on short-term investments.

General and administrative expenses to non-affiliates were $53,658 and $27,650 for the nine months ended September 30, 2003 and 2002, respectively. This increase was due primarily to an increase in the Illinois replacement tax paid in 2003.

Marketing expenses to non-affiliates were $35,517 and $109,027 for the nine months ended September 30, 2003 and 2002, respectively. This decrease was due primarily to a decrease in marketing, advertising and travel expenses relating to marketing the land portfolio to prospective purchasers.

Land operating expenses to non-affiliates were $75,059 and $63,403 for the nine months ended September 30, 2003 and 2002, respectively. This increase was due primarily to an increase in real estate taxes.

We determined that the maximum value of Parcel 1 and 12 could be realized if the parcels were developed and sold as individual lots. However, if we had followed that plan, there is a possibility that it could have increased income taxes. Therefore, we sold the parcels to a third party developer whereby 100% of the sales price was represented by notes receivable from the buyer. These transactions were deemed installment sales. After the sale, the developer, through limited liability companies or LLCs, secured third party financing to cover the deferred down payment owed to us as well as provide proceeds to begin the development of the project.  These sales were structured so that the deferred down payment received at the time of the sale was sufficient to provide a distribution to our limited partners that equated to the parcel capital allocated to the parcel plus approximately a 6% return per annum on the invested capital allocated to the parcel (parcel capital) through the date of the distribution.





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The velocity of the developer's individual home sales at Parcel 12 was slower than was originally projected and consequently, the developer's carrying costs were higher.  As a result of the slower lot sales, the net sale proceeds available to us were lower than anticipated.  As of September 30, 2003, we have recorded an allowance for doubtful accounts of $90,000 and $62,289 relating to the mortgage receivable and accrued interest receivable, respectively, relating to the sale of Parcel 12.  The related deferred gain for Parcel 12 of $45,800 has also been reserved and recorded against bad debt expense.



Our general partner guaranteed the third party development loans owed by the limited liability companies.  In reviewing the developments' financial situation, our general partner determined that it would be in its best interest to have an affiliate acquire the interests in the LLC that owned Parcel 12. The general partner and its affiliates concluded that they could better control the continuing costs to complete these developments and would therefore have the best opportunity to limit their exposure under the guarantee agreements and possibly recover a portion of the amount owed. An affiliate of our general partner contributed approximately $50,000 to acquire the interests in the LLC that owned Parcel 12. The affiliate of the general partner will complete the development and sale of the project. Our limited partners received distributions that equated to the invested capital allocated to each parcel (parcel capital) plus approximately a 6% return per annum on the parcel capital through the date of the distribution.



Item 3: Quantitative and Qualitative Disclosures about Market Risks



Not Applicable.





Item 4: Controls and Procedures



Within 90 days prior to the filing date of this report, the general partner conducted, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures.  Based upon that evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures are effective in timely alerting them to material information that is required to be disclosed in the periodic reports that we must file with the Securities and Exchange Commission.

There have been no significant changes in our internal controls or in other factors that could significantly affect these controls subsequent to the date of their evaluation.





PART II - Other Information



Items 1 through 5 are omitted because of the absence of conditions under which they are required.



Item 6: Exhibits and Reports on Form 8-K

(a)  Exhibits:

31.1 Rule 13a-14(a)/15d-14(a) Certification by principal executive officer

31.2 Rule 13a-14(a)/15d-14(a) Certification by principal financial officer

32.1 Section 1350 Certification by principal executive officer

32.2 Section 1350 Certification by principal financial officer

(b)  Reports on Form 8-K:

None























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SIGNATURES





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.









|      | INLAND CAPITAL FUND, L.P.                                
|----- | ---------------------------------------------------------
|      |                                                          
|By:   | Inland Real Estate Investment Corporation General Partner
|      |                                                          
|      |                                                          
|      |                                                          
|      | /S/ BRENDA G. GUJRAL                                     
|      |                                                          
|By:   | Brenda G. Gujral                                         
|      | President                                                
|Date: | March 26, 2004                                           
|      |                                                          
|      |                                                          
|      |                                                          
|      | /S/ PATRICIA A. DELROSSO                                 
|      |                                                          
|By:   | Patricia A. DelRosso                                     
|      | Senior Vice President                                    
|Date: | March 26, 2004                                           
|      |                                                          
|      |                                                          
|      |                                                          
|      | /S/ KELLY TUCEK                                          
|      |                                                          
|By:   | Kelly Tucek                                              
|      | Vice President and                                       
|      | principal financial officer                              
|Date: | March 26, 2004                                           
|      |