<PAGE>   1
                UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-K

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

                   For the fiscal year ended December 31, 1997
          ( )Transition Report Pursuant to Section 13 or 15(d) of the

                         Securities Exchange Act of 1934

                  For the transition period from       to      
                                                 -----    ----- 
                        Commission file number - 0-25574

                     TELECOMMUNICATIONS INCOME FUND X, L.P.
             ---------------------------------------------------
             (Exact name of registrant as specified in its charter)

                     Iowa                               42-1401715
                     ----                               ----------
         (State or other jurisdiction of             (I.R.S. Employer
        incorporation or organization)               Identification No.)

               100 Second Street S.E., Cedar Rapids, Iowa 52401
             ---------------------------------------------------
             (Address of principal executive offices) (Zip Code)

         Registrant's telephone number, including area code 319-365-2506
                                                            ------------

        Securities registered pursuant to Section 12(b) of the Act: NONE

                Securities pursuant to section 12 (g) of the Act:

                 Limited Partnership Interests (the "Units")
             ---------------------------------------------------
                               (Title of class)

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 check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K (ss.229.405 of this chapter) is not contained herein, and will
not be contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K (X).

As of March 12, 1998, 89,889 Units were issued and outstanding. Based on the
original issue price of $250 per Unit, the aggregate market value at March 12,
1998 was $22,472,250.

DOCUMENTS INCORPORATED BY REFERENCE. Portions of the Registration Statement on
Form S-1, dated August 27, 1993 are incorporated by reference into Part IV.


<PAGE>   2



                     TELECOMMUNICATIONS INCOME FUND X, L.P.

                          1997 FORM 10-K ANNUAL REPORT

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                            Page
<S>                                                                        <C>
                                    PART I

Item 1.  Business------------------------------------------------------------- 3
         
Item 2.  Properties----------------------------------------------------------- 5
Item 3.  Legal Proceedings---------------------------------------------------- 5
Item 4.  Submission of Matters to a Vote of
         Unit Holders--------------------------------------------------------- 5
         
                                    PART II
         
Item 5.  Market for the Registrant's Common Equity
         and Related Stockholders Matters------------------------------------  6
Item 6.  Selected Financial Data---------------------------------------------  6
Item 7.  Management's Discussion and Analysis
         of Financial Condition and
         Results of Operations-----------------------------------------------  7
Item 8.  Financial Statements and
         Supplementary Data-------------------------------------------------- 12
Item 9.  Changes in and Disagreements with Accountants
         on Accounting and Financial Disclosure------------------------------ 28

                                   PART III

Item 10. Directors and Executive
         Officers of the Registrant------------------------------------------ 28
Item 11. Executive Compensation---------------------------------------------- 30
Item 12. Security Ownership of Certain
         Beneficial Owners and Management------------------------------------ 31
Item 13. Certain Relationships and
         Related Transactions------------------------------------------------ 31

                                    PART IV

Item 14. Exhibits, Financial Statement Schedules and Reports on
         Form 8-K.----------------------------------------------------------- 32

SIGNATURES------------------------------------------------------------------- 33
EXHIBIT INDEX---------------------------------------------------------------- 34
</TABLE>


<PAGE>   3

                                     PART I

ITEM 1.   BUSINESS

Telecommunications Income Fund X, L.P., an Iowa limited partnership (the
"Partnership"), was organized on April 20, 1993. The general partner is Berthel
Fisher & Company Leasing, Inc. (the "General Partner"), an Iowa corporation that
has been in operation since 1988. The Partnership's business and the executive
offices of the General Partner are located at 100 Second Street S.E., Cedar
Rapids, Iowa 52401. Substantially all of the voting stock of the General Partner
is owned by Berthel Fisher & Company ("Berthel Fisher").

The Partnership began offering Units to the public on August 27, 1993. The
General Partner suspended sales of Units effective May 16, 1994, pending a
decision to prepare an offering supplement to the prospectus. This supplement
included updated financial information on the Partnership's lease portfolio and
updated the information in the Prior Performance tables contained in the
Partnership's prospectus dated August 27, 1993. The General Partner filed, on
July 16, 1994, Post-Effective Amendment No. 1 to the registration statement
updating the financial information and requesting an extension of sales to
December 31, 1994. Approval was received on this request effective July 20,
1994.

The Partnership will operate until December 31, 2002 unless dissolved sooner due
to the occurrence of any of the following events: (i) the vote by limited
partners owning a majority of the Partnership in accordance with the Partnership
Agreement; (ii) the withdrawal, bankruptcy, or dissolution and liquidation or
other cessation to exist as a legal entity of the general partner (unless any
successor general partner elected in accordance with the provisions of the
Partnership Agreement elects to continue the business of the Partnership); (iii)
the final distribution of all liquidating distributions among the limited
partners pursuant to the Partnership Agreement; or (iv) the sale or disposition
of all or substantially all of the assets of the Partnership without the
subsequent reinvestment in equipment.

The business of the Partnership is the acquisition and leasing of equipment,
primarily telecommunications equipment such as pay telephones and call
processing equipment. The Partnership began its primary business activities on
September 29, 1993.

A significant portion of the Partnership's business is with customers who are in
the telecommunications industry. The telecommunications industry, particularly
the pay telephone and long distance facets of the industry, is heavily regulated
by the Federal Communications Commission ("FCC") and by various state public
utility commissions. Regulation is not directed at the ownership or leasing of
telecommunications equipment, but is focused primarily on the business of the
Partnership's customers that operate in the telecommunications industry.
Generally, regulation affects rates that can be charged and the relationship of
the regional Bell operating companies to the rest of the pay telephone industry.
Management does not expect regulation to have any significant negative impact
upon the business of the Partnership.

The principle objective of the Partnership is to obtain the maximum available
economic return from its investment in equipment leases to unaffiliated third
parties with a view toward: (i) generating cash flow from operations, with the
intent to make distributions


<PAGE>   4


ITEM 1.  BUSINESS (CONTINUED)

during the Operating Phase (the period which ends when the General Partner
elects to begin the liquidation of the Partnership assets); (ii) reinvesting
(during the Operating Phase) any undistributed cash flow from operations in
additional equipment to be leased to increase the Partnership's assets; (iii)
obtaining the residual values of equipment upon sale; (iv) obtaining value from
sales of the Partnership's lease portfolio upon entering the Liquidating Phase
(the period during which the General Partner will liquidate the Partnership
assets); and (v) providing cash distributions to the partners during the
liquidating phase.

The Partnership acquires primarily telecommunications equipment (specifically
pay telephones and call processing equipment), that is leased to third parties
generally under full payout leases. The Partnership has also acquired other
types of equipment that is subject to full payout leases. Full payout leases are
leases that are expected to generate gross rental payments sufficient to recover
the purchase price of the subject equipment and any overhead and acquisition
costs. During 1997 the Partnership acquired equipment with a cost of $5,233,450.
All of this equipment has been leased.

Equipment acquired by the Partnership is installed in various locations by the
lessees. When the lessee installs the equipment in a location, a site location
agreement gives the lessee the right to have the equipment at this site for a
specified period of time. These site location agreements generally have a three
to five year term. The Partnership, in addition to its ownership of the
equipment, takes an assignment of and a first security interest in these site
location agreements. Therefore, if a lessee defaulted, the Partnership could
have the ability to re-sell or re-lease the equipment in place. This "in place"
value is generally much higher than the residual value of the equipment. The
telecommunications equipment generates revenue primarily through long distance
phone calls. The Partnership's lessee generally receives long distance revenue
from a contracted third party billing company. The Partnership also takes an
assignment of this revenue.

The General Partner acquires and approves leases on behalf of the Partnership.
The General Partner established guidelines to use in approving lessees.
Generally, before any lease is approved, there is a review of the potential
lessees' financial statements, credit references are checked, and outside
business and/or individual credit reports are obtained.

The equipment purchased by the Partnership consists of advanced technology pay
telephones and call processing systems to be used in hotels, hospitals,
colleges, universities, and correctional institutions. The Partnership has also
purchased and leased hotel satellite television equipment.

The Partnership's telecommunication equipment leases are concentrated in the pay
telephone and hotel industries representing approximately 69% and 17% of the
Partnership's direct finance lease portfolio at December 31, 1997, respectively.
Two customers each accounted for 15% of income from direct financing leases
during the year ended December 31, 1997. These customers are North American
Communications Group, Inc. and Hanson Lind Meyer. See Item 7 with respect to the
status of the North American Communications Group, Inc. leases.

The leasing industry is very competitive and the Partnership has fewer assets
than some of its major competitors.

<PAGE>   5

ITEM 2.   PROPERTIES

The Partnership does not own or lease any real estate. The Partnership's
materially important properties consist entirely of equipment under lease. The
carrying value of such equipment is represented by the Partnership's investment
in direct financing leases, net of an allowance for possible losses, and
operating leases which was $16,467,445 at December 31, 1997. This was comprised
primarily of telecommunications equipment, as described in Item 1.

ITEM 3.   LEGAL PROCEEDINGS

A foreclosure proceeding was filed on February 20, 1998 in the Iowa District
Court for Linn County located in Cedar Rapids, Iowa against North American
Communications Group, Inc. CWC Communications, Inc., North American
Communications Corporation (Missouri) d/b/a North American Communications of
Georgia, Inc., North American Communications of Mississippi, North American
Communications Group, Inc., d/b/a North American Communications of Louisiana,
Inc., Troy P. Campbell, Sr. And Archie W. Welch, Jr. for foreclosure of the
leased assets. The Partnership included in the foreclosure suit a claim for
damanges against the guarantors of the leases North American Communications
Group, Inc., Troy P. Campbell, Sr. and Archie W. Welch, Jr. in the amount of
$4,485,781. See Item 7 for additional information regarding the status of the
North American Communications Group, Inc.

leases.

ITEM 4.   SUBMISSION OF MATTERS TO A VOTE OF UNIT HOLDERS

          No matters were submitted to a vote of limited partners, through the
solicitation of proxies or otherwise during the year covered by this report.


<PAGE>   6

                                     PART II

ITEM 5.   MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER 
          MATTERS:

          The Registrants' Units are not publicly traded. There is no market for
the Registrant's Units and it is unlikely that any will develop. The General
Partner will resist the development of a public market for the Units.

<TABLE>
<CAPTION>

                                                              Number of Partners

                                                                      at

 Title of Class                                                   March 11, 1998
 -------------------------------------------------------------------------------
<S>                                                                   <C>
Limited Partner                                                       1,602
General Partner                                                          1
</TABLE>

Through December 31, 1997 there has been $8,774,623 of distributions paid to
Partners during the life of the Partnership. The Partnership has made
distributions during the prior three years to Partners of $27.00 per unit
totalling $2,430,890, $2,442,420 and $2,442,692 for 1997, 1996 and 1995,
respectively. As of December 31, 1997 the Partnership had accrued distributions
to Partners of $202,250.

ITEM 6.   SELECTED FINANCIAL DATA

<TABLE>
<CAPTION>

                                                  Year Ended December 31                        
                             ----------------------------------------------------------   Period Ended
                                 1997            1996           1995           1994       Dec. 31, 1993
                                                                                            (3 Months)
---------------------------------------------------------------------------------------------------------------------
<S>                         <C>            <C>            <C>            <C>            <C>
Total Revenue               $  3,045,703    $  3,704,977   $  3,828,433   $  2,261,020   $    136,896
Net Income (Loss)             (1,897,893)        196,197      1,551,153      1,295,435         85,518
Total Assets                  18,799,155      21,261,096     27,664,248     25,084,132      6,239,599
Line of Credit                 5,354,801       2,607,911      5,685,953      4,109,398            -0-
Bank term loan                   583,233       1,386,361      2,119,863            -0-            -0-
Provision for
    Possible Losses            3,628,090       1,092,551        828,911        360,000            -0-
Distributions to Partners      2,430,890       2,442,420      2,442,692      1,555,991        104,880
Earnings (Loss) per Unit          (21.11)           2.17          17.15          21.22           4.57
Distributions per Unit             27.00           27.00          27.00          27.00           7.41
</TABLE>

The above selected financial data should be read in connection with the
financial statements and related notes appearing elsewhere in this report.


<PAGE>   7


ITEM 7.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND 
          RESULTS OF OPERATIONS

<TABLE>
<CAPTION>
     Results of Operations                          Year Ended           Year Ended              Year Ended
                                                   Dec. 31, 1997        Dec. 31, 1996           Dec. 31, 1995
                                                   -------------        -------------           -------------
     <S>                                            <C>                  <C>                   <C>
     Description:

             Lease Income                            $ 2,843,989          $ 3,383,689          $  3,711,484
             Gain on Lease Termination                    85,520              260,706                77,143
             Management Fees                             353,109              379,655               422,866
             Administrative Services                      84,000               73,500                85,800
             Interest Expense                            407,538              692,863               672,512
             Professional Fees                           131,819              153,717                43,914
             Provision for
               Possible Losses                         3,628,090            1,092,551               828,911
             Depreciation                                 51,031              392,774               170,646
             Impairment Loss                             205,693              621,000                   -0-
</TABLE>

The decline in lease income in 1997 and 1996 compared to 1995 is due to the
Partnership's investment in direct financing leases declining from $25,861,350
at December 31, 1995 to $20,323,063 at December 31, 1997. This decline in lease
financing levels is a result of the Partnership's charge-off of a number of
leases within its portfolio due to non-payment of lease receivables. This
reduction has resulted in lower lease income recorded in 1997 and 1996.

At the end of a lease term, the Partnership will attempt to sell the equipment
under lease to the lessee for an amount equal to or exceeding the residual value
booked. Additionally, from time to time, the Partnership will receive a request
from a lessee for an early pay-off and the amount quoted by the General Partner
will always be at least equal to the Partnership's net investment and typically
will exceed the net investment as evidenced by the net gains recognized by the
Partnership on lease terminations.

Certain lessees have requested early termination of their lease contracts with
the Partnership. As the payphone industry matures, the capital structure of
these lessees has reached a level whereby they are able to secure financing from
other sources. When this occurs, the Partnership will normally quote a buyout to
the lessee which will consist of the entire contract balance remaining plus the
residual value of the assets. If this is not acceptable to the lessee, the
Partnership will discount the remaining contract payments at a rate of two
percent above prime plus the residual value of the assets. Under either
alternative, the Partnership will recognize a gain on the early termination. In
addition to some lessees improving capital structure, some lessees have been
acquired by other entities whose capital structure is such that they also desire
to refinance the equipment which was under lease to the Partnership. As such,
the Partnership's gain on lease terminations can and will vary from year to year
based on the number of requests received to terminate leases as well as the size
of the contract being terminated. The Partnership uses the cash generated from
these early terminations to purchase equipment for investments in direct
financing leases with other lessees.

Management fees are paid to the General Partner and represent 5% of the rental
and note payments received. Payments received in each of the three years ended
December 31 are as follows:

<TABLE>
<CAPTION>
                                               1997         1996         1995
                                               ----         ----         ----
         <S>                               <C>           <C>          <C>
         Rental Payments Received          $7,062,180    $7,593,100   $8,457,320
</TABLE>


<PAGE>   8

          
ITEM 7.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND 
          RESULTS OF OPERATIONS (CONTINUED)

The General Partner receives a monthly reimbursement for administrative services
provided to the Partnership.

The decrease in interest expense in 1997 is a result of the Partnership
borrowing less funds compared to 1996 and 1995. The Partnership has a
line-of-credit agreement with a bank which allows it to borrow the lessor of
$6.0 million or 40% of the Partnership's Qualified Accounts, as defined in the
agreement. The line-of-credit agreement bears interest at a variable rate of
9.5%, 10.13% and 9.5% at December 31, 1997, 1996 and 1995, respectively. The
balance outstanding under this line-of-credit agreement at December 31, 1997 was
$5,354,801. In August, 1995, the Partnership obtained a term loan of $2,350,000
with a bank secured by certain direct financing leases of the Partnership. This
term loan was obtained to capitalize on the favorable interest rate of the term
loan of 8.91% and to enable the Partnership to write more lease business and
enhance the Partnership's return. This term loan is due in monthly installments
through November, 1998.

Professional fees include payments for independent auditing services, tax return
preparation, and other accounting assistance. In addition, legal fees were
incurred for various regulatory filing requirements of the Partnership during
1995 and 1996.

Two lessees, Value Added Communications (VAC) and Telecable/Continental,
experienced cash flow problems in 1994 resulting in past due lease payments. The
past due lease payments from Telecable/Continental were converted to notes
receivable during 1994. These notes carried an interest rate of 15% and terms
ranging from three months to one year. At December 31, 1994, a reserve of
$360,000 was recorded to cover the possibility of future losses for leases in
default and other leases.

On October 10, 1995, a lessee of the Partnership, Value-Added Communication,
Inc. ("VAC"), filed a petition seeking protection under Chapter 11 of the
Bankruptcy Act. The Partnership's net investment in its leases with this
customer was $1,947,904 at December 31, 1995 representing approximately 8% of
the Partnership's net investment in direct financing leases. The bankruptcy
court's Order "Approving Emergency Sale" indicated that of the Partnership's
total net investment in direct financing leases with VAC, approximately $226,000
of leases would be purchased from the Partnership by an unrelated third party
for approximately $121,000 resulting in a loss to the Partnership of $105,000.
The remaining net investment balance of approximately $1.7 million was comprised
of several leases of equipment in the hospitality telephone industry. This
equipment, however, was not in service. Based upon the best information
available to management, it appeared the Partnership would incur a loss of
approximately $616,000 on these remaining leases. This amount, therefore,
together with the loss of $105,000 expected to be realized on the sale of the
assets under the other lease, was recorded as a provision for possible losses
specifically related to VAC at December 31, 1995. During 1996, as final
settlement on the Partnership's claim to the assets under lease, $580,597 was
received from parties to the bankruptcy. An additional loss of $646,307 was
recognized in the second quarter of 1996.

On May 6, 1996, a lessee of the Partnership, United Tele-systems of Virginia,
Inc. ("UTS"), filed a Voluntary Petition for Relief under Chapter 11 of the
Bankruptcy Code. The bankruptcy petition was dismissed on May 22, 1996 and, in
connection therewith, the Partnership exercised its right to manage the assets
leased to UTS. The net investment in the leases at the time the assets were
repossessed was approximately $686,000. The Partnership, the General Partner, an
affiliated partnership and UTS were named in a


<PAGE>   9


ITEM 7.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND 
          RESULTS OF OPERATIONS (CONTINUED)


lawsuit, filed by another creditor of UTS. The creditor was claiming $360,000 in
compensatory damages and $350,000 in punitive damages. Based on offers to
purchase the pay telephone equipment and an expected settlement offer related to
the lawsuit, the Partnership expected to incur a loss upon the sale or re-lease
of this equipment. Management charged $464,000 to the provision for possible
loan and lease losses for the expected loss in 1996 and reclassified its net
investment in the equipment, net of the specific allowance, to equipment under
operating leases pending its ultimate sale or re-lease under a direct finance
lease. The lawsuit was settled pending the outcome of an audit which is in
process. Management believes any loss as a result of the audit is adequately
covered by the Partnership's general allowance. The Equipment was sold to
another customer in 1997 with no additional loss to the Partnership.

In May 1995, the Partnership exercised its right to manage the assets leased to
Telecable/Continental due to nonpayment of lease receivables. At the time the
Partnership assumed management of these assets, its net investment in the leases
and notes receivable approximated $2,400,000 and the Partnership subsequently
purchased approximately $200,000 of additional equipment. During 1996,
$1,431,000 of this net investment was leased to an unrelated third party under a
direct financing lease, which was paid off in December 1996. The remaining net
equipment cost, which had been depreciated to $938,693 and relates to hotel
satellite television equipment, is expected by management to be recovered
through the sale of the equipment. Such equipment cost has been adjusted for an
impairment loss of $621,000 in 1996 and $205,693 in 1997, to reflect
management's estimated fair market value of the equipment. The equipment was
held for sale by the Partnership throughout 1997.

Due to cash flow problems experienced during 1997 by a lessee of the
Partnership, North American Communications Group, Inc. ("NACG"), the
Partnership, in an attempt to protect the assets leased to NACG, advanced funds
to various entities to whom NACG owed money, subject to either the terms of the
leases or to promissory notes which were executed by NACG. The Partnership
assisted in arranging a management agreement between NACG and another entity to
provide services to customers of NACG associated with the Partnership's leases.
In spite of the funds advanced by the Partnership and the management contract,
the cash flow of NACG continued to deteriorate. During the past several months,
the General Partner actively solicited bids from parties to purchase the assets
associated with the Partnership leases to NACG. Based on the value of similar
assets and contract sites, management believed the equipment leased to NACG had
substantial value. However, the offers received were not deemed adequate by the
General Partner.

Following a refusal by NACG to voluntarily execute a Deed in Lieu of
Foreclosure, the General Partner decided to institute a foreclose action against
NACG and its affiliates. Finally, the General Partner determined it was no
longer economically feasible to continue to advance funds on behalf of NACG,
discontinued doing so and informed all site operators of that decision. As a
result, the Partnership has decided to provide for a specific loss reserve of
$3,319,159 at December 31, 1997 which is equal to the carrying value of the
assets on the Partnership's books. The Partnership will continue to attempt to
sell and/or re-lease these assets and any amounts received through such efforts
will be credited as a recovery of previous charges.


<PAGE>   10

ITEM 7.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND 
          RESULTS OF OPERATIONS (CONTINUED)

The allowance for possible lease losses is based upon a continuing review of
past lease loss experience, current economic conditions and the underlying lease
asset value of the portfolio. At the end of each quarter a review of the
allowance account is conducted. At a minimum it is the Partnership's desire to
maintain a loss reserve equal to 1.5 percent of the Partnership's investment in
leases and notes, exclusive of any specific reserves. The Partnership currently
has a loss reserve (exclusive of specific reserves) of $536,459 or 2.5% of the
lease and note portfolio. Management has determined to increase its general
allowance due to the loss history of the Partnership.

The Partnership has been unable to collect all of the property taxes it has paid
on behalf of customers leasing equipment from the Partnership. As a result, a
charge of $114,677 has been made to reflect what management believes to be
uncollectible. There remains approximately $45,699 of property tax receivable on
the Partnership's books as of December 31, 1997. The Partnership continues to
pursue the collection of charged-off tax receivables. Any amounts collected will
serve as a recovery against amounts previously written off.

Specific losses or expected losses charged to the provision for possible lease
losses are as follows:

<TABLE>
<CAPTION>
                                          1997                  1996                1995
                                       ----------            ----------         ----------
        <S>                            <C>                  <C>                 <C>
        VAC                            $      -0-            $  646,307         $  721,000

        UTS                                   -0-               464,000                -0-

        North American                  3,319,159                   -0-                -0-

        Property Taxes                    114,677                   -0-                -0-
                                       ----------            ----------         ----------

                 TOTAL                 $3,433,836            $1,110,307         $  721,000
                                       ==========            ==========         ==========
</TABLE>

As of December 31, 1997 there were five customers with payments owed to the
Partnership which were over 90 days past due. When payments are past due more
than 90 days, the Partnership discontinues recognizing income on those customer
contracts. The contract balance remaining on these contracts was $2,606,004 at
December 31, 1997. The Partnership's net investment in these contracts at
December 31, 1997 was $2,503,682. Management is monitoring these contracts and
at the present time has determined the Partnership's investment in these
contracts is sufficiently collateralized. Management will continue to monitor
these contracts and take the necessary steps to protect the Partnership's
investment.

One customer has 27 contracts with amounts past due over 90 days. The contract
balance remaining on these contracts was $2,379,882 at December 31, 1997. The
Partnership's remaining net investment in these contracts was $2,311,690 at
December 31, 1997. The value of the equipment associated with this lease exceeds
the Partnership's investment in the equipment. In addition, the lessee is
actively seeking a buyer for the equipment. As such, due to the value of the
assets and the potential buyout of this lease, management has decided not to
provide a provision for possible losses for these contracts. There are no
assurances that the sale will materialize, and other events may occur that may
deteriorate the current value of these assets. Management is monitoring this
contract and will take whatever steps are necessary to protect the Partnership's
investment in this contract.
<PAGE>   11

ITEM 7.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND 
          RESULTS OF OPERATIONS (CONTINUED)

The General Partner is engaged directly for its own account in the business of
acquiring and leasing equipment. The General Partner serves as the general
partner of Telecommunications Income Fund IX, L.P. ("TIF IX") and
Telecommunications Income Fund XI, L.P. ("TIF XI"), publicly owned limited
partnerships that are engaged in the equipment leasing business. Also, an
affiliate of the General Partner is the general partner of a privately offered
active limited partnership. As of December 31, 1997, the net proceeds of the
private program and TIF IX have been invested in specific equipment. At December
31, 1997, investor proceeds from TIF XI were not available for investment by TIF
XI. The activities of the General Partner, in regards to its other leasing
activities, has had no impact on the Partnership to date in management's
opinion.

The equipment that the Partnership leases is maintained by the lessee, and the
lessee is responsible for keeping the equipment upgraded with any improvements
that may be developed. The Partnership generally establishes the equipment's
residual value at 10% of the equipment's' original cost. This residual value is
generally expected to be realized by the sale of the equipment at the expiration
of the original lease term. The General Partner monitors the maintenance and
upgrades to the equipment and expects the Partnership to realize residual values
of at least 10%.

The General Partner is not aware of any regulatory issues that may have a
substantial negative impact on the telecommunications business that the
Partnership leases equipment to. There are and will continue to be regulatory
issues in the telecommunications industry that the General Partner will monitor.

The equipment leases acquired by the Partnership have been financed to yield
rates of return between 15% and 20%. The lease terms vary from 36 months to 60
months. The rate charged on a particular lease depends on the size of the
transaction and the financial strength of the lessee.

Inflation affects the cost of equipment purchased and the residual values
realized when leases terminate and equipment is sold. The impact of inflation is
mitigated as any increases in lease related expenses are passed on to the
lessees through corresponding increases in rental rates as new leases are
entered into.

The Partnership recognizes that the arrival of the Year 2000 poses a unique
challenge to the ability of all systems to recognize the date change from
December 31, 1999 to January 1, 2000 and, like other companies, has assessed and
is repairing its computer applications and business processes to provide for
their continued functionality. An assessment of the readiness of external
entities which it interfaces with, such as vendors, counterparties, customers,
payment systems, and others, is ongoing. The Partnership does not expect the
cost to address the Year 2000 will be material.

The Partnership has determined that the software it utilizes in its operations
is compatible with the Year 2000. The Partnership has not yet determined whether
the Year 2000 issue has been addressed by its customers. If the Partnership's
customers have not addressed this issue, it could lead to non-payments of
amounts owed to the Partnership. The Partnership intends to contact all of its
customers regarding this issue by the middle of 1998.


<PAGE>   12



<TABLE>
<CAPTION>
LIQUIDITY AND CAPITAL RESOURCES                         Year Ended           Year Ended          Year Ended
-------------------------------                       Dec. 31, 1997        Dec. 31, 1996       Dec. 31, 1995
                                                      -------------        -------------       -------------
<S>                                                   <C>                  <C>                 <C>
Major Cash Sources (Uses):

        Operations                                     $  1,595,449         $  1,938,010        $  2,566,020
        Net Proceeds (payments)from Line of Credit        2,746,890          (3,078,042)           1,576,555
        Repayments/Terminations of Leases                 5,275,866            9,006,750           5,085,144
        
        Purchase of Equipment and Leases                (5,233,450)          (4,323,201)        (10,204,463)
        Distributions to Partners                       (2,545,969)          (2,441,178)         (2,427,345)
</TABLE>

The Partnership is required to establish working capital reserves of no less
than 1% of the proceeds to satisfy general liquidity requirements, operating
costs of equipment, and the maintenance and refurbishment of equipment. At
December 31, 1997, that working capital reserve, as defined, would be $226,175.
Actual cash on hand at December 31, 1997 was $5,928. While this is less than the
amount required, the Partnership can borrow on its line of credit to satisfy
this requirement.

At December 31, 1997, the Partnership had a line of credit agreement with a bank
that allows the Partnership to borrow the lesser of $6.0 million, or 40% of the
Partnership's Qualified Accounts as defined in the agreement. As of December 31,
1997, the balance outstanding under this line of credit was $5,354,801. With the
exception of those specific assets pledged as security under the bank term loan
agreement discussed below, this borrowing is secured by all assets of the
Partnership. Before any funds are borrowed, the Partnership first utilizes all
available excess cash. The Partnership's line of credit is used to acquire
additional leases as they become available. The line of credit matures on April
30, 1998. Management is currently working with the present lender and expects to
renew the existing agreement.

In August, 1995, the Partnership obtained a term loan of $2,350,000 with a bank
secured by certain direct financing leases of the Partnership. This term loan
was obtained to capitalize on the favorable interest rate (8.91%) of the term
loan and to enable the Partnership to write more lease business and enhance the
Partnership's return. This term loan is due in monthly installments through
November, 1998. The balance outstanding at December 31, 1997 under this term
loan agreement was $583,233. The agreement is collateralized by certain direct
financing leases and a second interest in all other Partnership assets. The
agreement is also guaranteed by the General Partner. Covenants under the
agreement require the Partnership, among other things, to be profitable, not
exceed a 40% debt to original equity raised ratio, and not sell a material
portion of its assets. Management has obtained a waiver from the lending
institution.

Cash flow from operating activities has been less than the distributions to
Partners for 1997 and 1996.

ITEM 8.   FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The following financial statements and related information as of and for the
years ended December 31, 1997, 1996 and 1995 are included in Item 8:

     Report of Independent Auditors'
     Balance Sheets
     Statements of Operations
     Statements of Changes in Partners' Equity
     Statements of Cash Flows
     Notes to Financial Statements


<PAGE>   13


INDEPENDENT AUDITORS' REPORT

To the Partners
Telecommunications Income Fund X, L.P.

We have audited the accompanying balance sheets of Telecommunications Income
Fund X, L.P. as of December 31, 1997 and 1996, and the related statements of
operations, changes in partners' equity and cash flows for each of the three
years in the period ended December 31, 1997.  These financial statements are
the responsibility of the Partnership's management.  Our responsibility is to
express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards.  Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement.  An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements.  An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation.  We believe that our audits provide a reasonable basis
for our opinion.

In our opinion, such financial statements present fairly, in all material
respects, the financial position of Telecommunications Income Fund X, L.P. at
December 31, 1997 and 1996, and the results of its operations and its cash
flows for each of the three years in the period ended December 31, 1997, in
conformity with generally accepted accounting principles.



Deloitte & Touche LLP

Cedar Rapids, Iowa
March 5, 1998





<PAGE>   14


TELECOMMUNICATIONS INCOME FUND X, L.P.

BALANCE SHEETS
DECEMBER 31, 1997 AND 1996
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ASSETS (Note 5)                                                                 1997             1996       
<S>                                                                       <C>               <C>             
Cash and cash equivalents                                                     $     5,928     $   516,612   
Available-for-sale security                                                       140,888         129,945   
Net investment in direct financing leases                                                                   
 and notes receivable (Note 2)                                                 21,827,573      20,323,138   
Allowance for possible loan and lease losses (Note 3)                          (3,855,618)       (323,398)  
                                                                              -----------     -----------   
Direct financing leases and notes receivable, net                              17,971,955      19,999,740   
Equipment leased under operating leases, less accumulated                                                   
 depreciation of $79,305 in 1996                                                        -         103,722   
Equipment held for sale (Note 4)                                                  112,000         317,693   
Intangibles, less accumulated amortization of                                                               
 $30,489 in 1997 and $21,626 in 1996                                                7,009          15,872   
Other assets                                                                      561,375         177,512   
                                                                              -----------     -----------   
TOTAL                                                                         $18,799,155     $21,261,096   
                                                                              ===========     ===========   
LIABILITIES AND PARTNERS' EQUITY                                                                            
                                                                                                            
LIABILITIES:                                                                                                
 Line-of-credit agreement (Note 5)                                            $ 5,354,801     $ 2,607,911   
 Due to affiliates                                                                 23,256          89,870   
 Distributions payable to partners                                                202,250         204,800   
 Accrued expenses and other liabilities                                           223,092          87,430   
 Lease security deposits                                                          509,544         551,376   
 Note payable (Note 5)                                                            583,233       1,386,361   
                                                                              -----------     -----------   
      Total liabilities                                                         6,896,176       4,927,748   
                                                                              -----------     -----------   
PARTNERS' EQUITY, 100,000 units authorized (Notes 1 and 6):                                                 
 General partner, 40 units issued and outstanding                                   8,272          10,194   
 Limited partners, 89,849 units in 1997 and 90,370 units                                                    
   in 1996 issued and outstanding                                              11,927,080      16,366,470   
Unrealized loss on available-for-sale security                                    (32,373)        (43,316)  
                                                                              -----------     -----------   
      Total partners' equity                                                   11,902,979      16,333,348   
                                                                              -----------     -----------   
TOTAL                                                                         $18,799,155     $21,261,096   
                                                                              ===========     ===========   
</TABLE>   

See notes to financial statements.

                                     -2-

<PAGE>   15
TELECOMMUNICATIONS INCOME FUND X, L.P.


STATEMENTS OF OPERATIONS
YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
                                                                  1997               1996              1995
<S>                                                         <C>                <C>                <C>
REVENUES:
  Income from direct financing leases                       $   2,843,989      $   3,383,689       $ 3,711,484
  Gain on lease terminations                                       85,520            260,706            77,143
  Interest and other income                                       116,194             60,582            39,806
                                                            -------------      -------------       -----------
       Total revenues                                           3,045,703          3,704,977         3,828,433
                                                            -------------      -------------       -----------
EXPENSES:                                        
  Management and administrative fees (Note 7)                     437,109            461,027           508,666
  Other general and administrative expenses                       214,135            248,565            96,545
  Interest expense                                                407,538            692,863           672,512
  Depreciation expense                                             51,031            392,774           170,646
  Provision for possible loan and lease losses (Note 3)         3,628,090          1,092,551           828,911
  Impairment loss on equipment (Note 4)                           205,693            621,000                 -
                                                            -------------      -------------       -----------
       Total expenses                                           4,943,596          3,508,780         2,277,280
                                                            -------------      -------------       -----------
NET INCOME (LOSS)                                           $  (1,897,893)     $     196,197       $ 1,551,153
                                                            =============      =============       ===========
NET INCOME (LOSS) ALLOCATED TO:                  
  General partner                                           $        (842)     $          87       $       686
  Limited partners                                             (1,897,051)           196,110         1,550,467
                                                            -------------      -------------       -----------
                                                            $  (1,897,893)     $     196,197       $ 1,551,153
                                                            =============      =============       ===========
NET INCOME (LOSS) PER PARTNERSHIP UNIT                      $      (21.11)     $        2.17       $     17.15
                                                            =============      =============       ===========
WEIGHTED AVERAGE PARTNERSHIP UNITS               
  OUTSTANDING                                                      89,889             90,455            90,470
                                                            =============      =============       ===========
</TABLE>

See notes to financial statements.               


                                     -3-


<PAGE>   16



TELECOMMUNICATIONS INCOME FUND X, L.P.


STATEMENTS OF CHANGES IN PARTNERS' EQUITY
YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
                                                                                        
                                                                                            UNREALIZED  
                                                                                             LOSS ON
                                                GENERAL          LIMITED PARTNERS           AVAILABLE-       TOTAL 
                                                PARTNER      ---------------------------     FOR-SALE      PARTNERS'
                                               (40 UNITS)       UNITS        AMOUNT          SECURITY       EQUITY
<S>                                           <C>              <C>        <C>            <C>              <C>
BALANCE AT DECEMBER 31, 1994                      $11,581       90,430    $19,517,845     $        -       $19,529,426

  Net income                                          686            -      1,550,467              -         1,551,153

  Distributions to partners
   ($27.00 per unit) (Note 6)                      (1,080)           -     (2,441,612)             -        (2,442,692)
                                                  -------       ------    -----------     ----------       -----------
BALANCE AT DECEMBER 31, 1995                       11,187       90,430     18,626,700              -        18,637,887

  Net income                                           87            -        196,110              -           196,197

  Distributions to partners
    ($27.00 per unit) (Note 6)                     (1,080)           -     (2,441,340)             -        (2,442,420)

  Withdrawal of limited partners                        -          (60)       (15,000)             -           (15,000)

  Change in unrealized loss on
    available-for-sale security                         -            -              -        (43,316)          (43,316)
                                                  -------       ------    -----------     ----------       -----------
BALANCE AT DECEMBER 31, 1996                       10,194       90,370     16,366,470        (43,316)       16,333,348

  Net loss                                           (842)           -     (1,897,051)             -        (1,897,893)

  Distributions to partners
   ($27.00 per unit) (Note 6)                      (1,080)           -     (2,429,810)             -        (2,430,890)

  Withdrawal of limited partners                        -         (521)      (112,529)             -          (112,529)

  Change in unrealized loss on
    available-for-sale security                         -            -              -         10,943            10,943
                                                  -------       ------    -----------     ----------       -----------
BALANCE AT DECEMBER 31, 1997                      $ 8,272       89,849    $11,927,080     $  (32,373)      $11,902,979
                                                  =======       ======    ===========     ==========       ===========
</TABLE>

See notes to financial statements.


                                      -4-


<PAGE>   17

TELECOMMUNICATIONS INCOME FUND X, L.P.

STATEMENTS OF CASH FLOWS
YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
                                                                  1997             1996            1995      
<S>                                                              <C>            <C>             <C>            
OPERATING ACTIVITIES:                                                                                        
 Net income (loss)                                               $(1,897,893)   $    196,197    $  1,551,153 
 Adjustments to reconcile net income (loss) to net cash                                                             
  from operating activities:                                                                                 
  Gain on lease terminations                                         (85,520)       (260,706)        (77,143)
  Depreciation of equipment                                           51,031         392,774         170,646 
  Amortization of intangibles                                          8,863          21,626          32,865 
  Provision for possible loan and lease losses                     3,628,090       1,092,551         828,911 
  Impairment loss on equipment                                       205,693         621,000               - 
  Changes in operating assets and liabilities:                                                               
   Other assets                                                     (383,863)         62,691        (155,342)
   Due to affiliates                                                 (66,614)       (162,322)        217,149 
   Accrued expenses and other liabilities                            135,662         (25,801)         (2,219)
                                                                 -----------    ------------    ------------ 
      Net cash from operating activities                           1,595,449       1,938,010       2,566,020 
                                                                 -----------    ------------    ------------ 
INVESTING ACTIVITIES:                                                                                        
 Acquisitions of, and purchases of equipment for,                                                            
  direct financing leases                                         (5,233,450)     (4,323,201)    (10,204,463)
 Repayments of direct financing leases                             3,796,745       3,709,079       4,247,962 
 Proceeds from termination of direct financing leases              1,479,121       5,297,671         837,182 
 Repayments of notes receivable                                        5,490               -               - 
 Issuance of notes receivable                                     (1,510,000)              -               - 
 Net lease security deposits collected (paid)                        (41,832)       (100,188)        131,260 
                                                                 -----------    ------------    ------------ 
      Net cash from investing activities                          (1,503,926)      4,583,361      (4,988,059)
                                                                 -----------    ------------    ------------ 
FINANCING ACTIVITIES:                                                                                        
 Proceeds from line-of-credit borrowings                          12,124,666      13,838,858      14,740,346 
 Repayments of line-of-credit borrowings                          (9,377,776)    (16,916,900)    (13,163,791)
 Proceeds from additional borrowings                                       -               -       2,350,000 
 Repayment of additional borrowings                                 (803,128)       (733,502)       (230,137)
 Distributions and withdrawals paid to partners                   (2,545,969)     (2,456,178)     (2,427,345)
 Loan origination fees incurred                                            -               -         (41,500)
                                                                 -----------    ------------    ------------ 
      Net cash from financing activities                            (602,207)     (6,267,722)      1,227,573 
                                                                 -----------    ------------    ------------ 
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                (510,684)        253,649      (1,194,466)
                                                                                                             
CASH AND CASH EQUIVALENTS AT                                                                                 
 BEGINNING OF YEAR                                                   516,612         262,963       1,457,429  
                                                                 -----------    ------------    ------------  
CASH AND CASH EQUIVALENTS AT                                                                                 
 END OF YEAR                                                     $     5,928    $    516,612    $    262,963  
                                                                 ===========    ============    ============  
</TABLE> 
                                                                     (Continued)

                                     -5-


<PAGE>   18




TELECOMMUNICATIONS INCOME FUND X, L.P.


STATEMENTS OF CASH FLOWS
YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995 (CONCLUDED)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
                                                                                  1997            1996            1995
<S>                                                                          <C>             <C>             <C>
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
   Interest paid                                                                $387,992      $ 683,925        $ 634,582
   Noncash investing and financing activities:
     Decrease in trade accounts payable attributed to 
       equipment purchase costs accrued                                                -              -          586,300
     Available-for-sale security exchanged for payment on lease                        -        173,261                -
     Notes receivable exchanged for payments on leases                                 -              -                -
     Equipment reclassified from direct financing leases to operating leases           -        183,027        2,484,236
     Equipment reclassified from notes receivable to operating leases                  -              -          137,555
     Equipment reclassified from operating leases to held for sale                     -        317,693                -
     Equipment reclassified from operating leases to direct financing leases           -      1,381,952                -
     Change in unrealized loss on available-for-sale security                     10,943        (43,316)               -
</TABLE>                                                                        

See notes to financial statements.

                                     -6-


<PAGE>   19


TELECOMMUNICATIONS INCOME FUND X, L.P.

NOTES TO FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995
--------------------------------------------------------------------------------

1.  SIGNIFICANT ACCOUNTING POLICIES

    ORGANIZATION AND NATURE OF OPERATIONS- Telecommunications Income Fund X,
    L.P. (the "Partnership") was formed on April 20, 1993 under the Iowa
    Limited Partnership Act.  The general partner of the Partnership is Berthel
    Fisher & Company Leasing, Inc. (the "General Partner"), an Iowa
    corporation.  During the offering period, which ended December 31, 1994,
    the Partnership sold 90,470 partnership interests at a price per unit of
    $250.

    The Partnership's operations are conducted throughout the United States.
    The Partnership primarily acquires telecommunications equipment for lease
    to third parties.  The lease agreements with individual customers are
    generally in excess of $500,000 and certain agreements exceed 10% of the
    Partnership's direct finance lease portfolio (see Note 2).  At any time
    after December 31, 1999 (or earlier if the General Partner determines it to
    be in the Partnership's best interest), the Partnership will cease
    reinvestment in equipment and leases and will begin the orderly liquidation
    of Partnership assets.  The Partnership must dissolve on December 31, 2002,
    or earlier, upon the occurrence of certain events (see Note 6).

    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
    significantly from those estimated.  Material estimates that are
    particularly susceptible to significant change in the near-term relate to
    the determination of the allowance for possible loan and lease losses and
    the estimated unguaranteed residual values of the Partnership's leased
    equipment.

    Most of the Partnership's leases and notes receivable are with customers
    that are in the entrepreneurial stage and, therefore, are highly leveraged
    and require financing in place of or to supplement financing from banks.
    Although the Partnership attempts to mitigate its credit risk through the
    use of a variety of commercial credit reporting agencies when processing
    the applications of its customers, failure of the Partnership's customers
    to make scheduled payments under their equipment leases and notes
    receivable could have a material near-term impact on the allowance for
    possible loan and lease losses.

    Realization of residual values depends on many factors, several of which
    are not within the Partnership's control, including general market
    conditions at the time of the original contract's expiration, whether there
    has been unusual wear and tear on, or use of, the equipment, the cost of
    comparable new equipment, the extent, if any, to which the equipment has
    become technologically or economically obsolete during the contract term
    and the effects of any additional or amended government regulations.  These
    factors, among others, could have a material near-term impact on the 
    estimated unguaranteed residual values.

    CERTAIN RISK CONCENTRATIONS - The Partnership's telecommunication equipment
    leases are concentrated in the pay telephone and hotel industries,
    representing approximately 69% and 17%, and 70% and 24%  of the
    Partnership's direct finance lease portfolio at December 31, 1997 and 1996,
    respectively.


                                     -7-


<PAGE>   20


    RELATED PARTY TRANSACTIONS - In fulfilling its role as general partner,
    Berthel Fisher & Company Leasing, Inc. enters into transactions with the
    Partnership in the normal course of business.  Further, the Partnership
    also enters into transactions with affiliates of Berthel Fisher & Company
    Leasing, Inc.  These transactions are set forth in the notes that follow.
    Management is of the opinion that these transactions are in accordance with
    the terms of the Agreement of Limited Partnership.

    CASH AND CASH EQUIVALENTS - The Partnership considers all highly liquid
    investments with a maturity of three months or less when purchased to be
    cash equivalents.

    AVAILABLE-FOR-SALE SECURITY - The Partnership has an investment in a
    marketable equity security classified as available-for-sale.
    Available-for-sale securities are carried at fair value, with unrealized
    gains and losses reported as a separate component of partners' equity.  At
    December 31, 1997, the security had a cost of $173,261 and an estimated
    fair value of $140,888, resulting in an unrealized loss of $32,373.  Fair
    value is determined using published market prices.

    NET INVESTMENT IN DIRECT FINANCING LEASES - The Partnership's primary
    activity consists of leasing telecommunications equipment under direct
    financing leases generally over a period of three to five years.  At the
    time of closing a direct financing lease, the Partnership records the gross
    lease contract receivable, the estimated unguaranteed residual value and
    unearned lease income.  The unearned lease income represents the excess of
    the gross lease receivable plus the estimated unguaranteed residual value
    over the cost of the equipment leased.  In addition, the Partnership
    capitalizes all initial direct costs associated with originating the direct
    financing lease.  The unearned income and initial direct costs are
    amortized to income over the lease term so as to produce a constant
    periodic rate-of-return on the net investment in the lease.  Lessees are
    responsible for all taxes, insurance and maintenance costs.

    The realization of the estimated unguaranteed residual value of leased
    equipment depends on the value of the leased equipment at the end of the
    lease term and is not a part of the contractual agreement with the lessee.
    Estimated residual values are based on estimates of amounts historically
    realized by the Partnership for similar equipment and are periodically
    reviewed by management for possible impairment.

    Direct financing leases are accounted for as operating leases for income
    tax purposes.

    NOTES RECEIVABLE - Notes receivable are carried at the principle balance
    outstanding.  Interest income on notes receivable is accrued based on the
    principle amount outstanding.

    ALLOWANCE FOR POSSIBLE LOAN AND LEASE LOSSES - The Partnership performs
    credit evaluations prior to approval of a loan and lease.  Subsequently,
    the creditworthiness of the customer and the value of the underlying assets
    are monitored on an ongoing basis. Under its lease agreements, the
    Partnership retains legal ownership of the leased asset.  The Partnership
    maintains an allowance for possible loan and lease losses which could arise
    should customers become unable to discharge their obligations under the
    loan and lease agreements.  The allowance for possible loan and lease
    losses is maintained at a level deemed appropriate by management to provide
    for known and inherent risks in the loan and lease portfolio.  The
    allowance is based upon a continuing review of past loss experience,
    current economic conditions, delinquent loans and leases, an estimate of
    potential loss exposure on significant customers in adverse situations, and
    the underlying asset value. The consideration of such future potential
    losses also includes an evaluation for other than temporary declines in 
    value of the underlying assets.  Loans and leases which are deemed 
    uncollectible are charged off and deducted from the allowance.  
    The provision for possible loan and lease losses and recoveries are added 
    to the allowance.



                                     -8-

<PAGE>   21


    EQUIPMENT - Equipment leased under operating leases is stated at cost less
    accumulated depreciation.  The equipment is depreciated using the
    straight-line method over the estimated useful lives of the assets (five
    years) to the estimated residual value of the equipment at the end of the
    lease term.  Estimated residual values are based on estimates of amounts
    historically realized by the Partnership for similar equipment and are
    periodically reviewed by management for possible impairment.

    Equipment held for sale is stated at lower of cost or estimated fair market
    value.

    INTANGIBLES - Intangibles consist of organization costs incurred with the
    formation of the Partnership and financing costs incurred in connection
    with borrowing agreements.  Deferred organization expenses are being
    amortized over a five-year period.  Deferred financing costs are being
    amortized over the life of the related debt, which is approximately three
    years.

    TAX STATUS - Under present income tax laws, the Partnership is not liable
    for income taxes, as each partner recognizes a proportionate share of the
    Partnership income or loss in their income tax return.  Accordingly, no
    provision for income taxes is made in the financial statements of the
    Partnership.

    NET INCOME (LOSS) PER PARTNERSHIP UNIT - Net income (loss) per partnership
    unit is based on the weighted average number of units outstanding
    (including both general and limited partners' units).

    IMPACT OF NEW ACCOUNTING PRONOUNCEMENTS - In June 1997, the Financial
    Accounting Standards Board ("FASB") issued Statement of Financial
    Accounting Standards ("SFAS") No. 130, "Reporting Comprehensive Income".
    SFAS No. 130 establishes standards for reporting and display of
    comprehensive income and its components in the financial statements.  SFAS
    No. 130 is effective for fiscal years beginning after December 15, 1997.
    Reclassification of financial statements for earlier periods provided for
    comparative purposes is required.  The Partnership is in the process of
    determining its preferred format.  The adoption of SFAS No. 130 will have
    no impact on the Partnership's results of operations, financial position or
    cash flows.

    In June 1997, the FASB issued SFAS No. 131, "Disclosures about Segments of
    an Enterprise and Related Information".  SFAS No. 131 establishes standards
    for the way that public business enterprises report information about
    operating segments in annual financial statements and requires that those
    enterprises report selected information about operating segments in interim
    financial reports issued to shareholders.  It also establishes standards
    for related disclosures about products and services, geographic areas, and
    major customers.  SFAS No. 131 is effective for financial statements for
    fiscal years beginning after December 15,1997.  Financial statement
    disclosures for prior periods are required to be restated.  The Partnership
    is in the process of evaluating the disclosure requirements.  The adoption
    of SFAS No. 131 will have no impact on the Partnership's consolidated
    results of operations, financial position or cash flows.



                                     -9-

<PAGE>   22


2.  NET INVESTMENT IN DIRECT FINANCING LEASES AND NOTES RECEIVABLE

    The Partnership's net investment in direct financing leases and notes
    receivable consists of the following at December 31, 1997 and 1996:


<TABLE>
<CAPTION>
                                                                    1997           1996
<S>                                                             <C>            <C>
Minimum lease payments receivable                                $22,500,795    $23,482,180
Estimated unguaranteed residual values                             2,256,257      2,459,691
Unamortized initial direct costs                                      93,855        194,303
Unearned income                                                   (4,527,844)    (5,813,036)
Notes receivable                                                   1,504,510              -
                                                                ------------    -----------
Net investment in direct financing leases and notes receivable   $21,827,573    $20,323,138
                                                                ============    ===========
</TABLE>

    At December 31, 1997, future minimum payments to be received under the
    direct financing leases and the estimated unguaranteed residuals to be
    realized at the expiration of the direct financing leases are as follows:




<TABLE>
<CAPTION>
                                                                  MINIMUM          ESTIMATED                                
                                                                  LEASE           UNGUARANTEED                               
                                                                 PAYMENTS           RESIDUAL                                 
                                                                RECEIVABLE          VALUES                                  
<S>                                                             <C>             <C>  
Years ending December 31:                                                  
          1998                                                   $11,595,349    $   345,587                              
          1999                                                     5,346,194        586,971                              
          2000                                                     3,578,554        924,902                              
          2001                                                     1,547,363        323,296                              
          2002                                                       425,960         62,846                              
          Thereafter                                                   7,375         12,661                              
                                                                 -----------    -----------                              
          Total                                                  $22,500,795    $ 2,256,257                              
                                                                 ===========    ===========                              
</TABLE>                           
                           
    The Partnership, General Partner and certain affiliates of the General
    Partner purchase directly and indirectly a substantial portion of
    telecommunications equipment under lease from Intellicall, Inc., a
    publicly-held company.  The General Partner's parent and certain limited
    partners are investors in a limited partnership which owns approximately 7%
    of the outstanding common stock of Intellicall, Inc.  In addition, a
    principal stockholder of the General Partner's parent is also an investor
    in this limited partnership.

    Additionally, the Partnership leases equipment to certain companies for
    which the General Partner or its affiliates have an ownership interest in,
    provide financing to, or provide investment advisory services for such
    companies.  The Partnership's net investment in direct financing leases
    with these companies approximated $4,367,170 and $2,815,000 at December 31,
    1997 and 1996, respectively.




                                     -10-
<PAGE>   23


    Four customers each account for 10% or more of the amount of income from
    direct financing leases for the years ended December 31, 1997, 1996 and
    1995, as follows:




<TABLE>
<CAPTION>
                                       1997        1996     1995
<S>                                   <C>         <C>         <C>
Customer A                              -%          -%         10%
Customer B                              -           9          16
Customer C                             15           9          10
Customer D                             15          14           7
</TABLE>                        

3.   ALLOWANCE FOR POSSIBLE LOAN AND LEASE LOSSES

    The changes in the allowance for possible loan and lease losses for the
    years ended December 31, 1997, 1996 and 1995 are as follows:

<TABLE>
<CAPTION>
                                    1997           1996           1995
<S>                             <C>           <C>              <C>
Balance at beginning of year    $  323,398    $ 1,188,911      $  360,000
  Provision                      3,628,090      1,092,551         828,911
  Charge-offs                      (95,870)    (1,958,064)              -
                                ----------    -----------      ----------
Balance at end of year          $3,855,618    $   323,398      $1,188,911
                                ==========    ===========      ==========
</TABLE>

    The allowance for possible loan and lease losses consisted of specific
    allowances for leases of $3,319,159, $21,000 and $721,000 and a general
    unallocated allowance of $536,459, $302,398, and $467,911, respectively, at
    December 31, 1997, 1996 and 1995.

    On October 10, 1995, a lessee of the Partnership, Value-Added
    Communication, Inc. ("VAC"), filed a petition seeking protection under
    Chapter 11 of the Bankruptcy Act.  The Partnership's net investment in its
    leases with this customer was $1,947,904 at December 31, 1995 representing
    approximately 8% of the Partnership's net investment in direct financing
    leases.  The bankruptcy court's Order "Approving Emergency Sale" indicated
    that of the Partnership's total net investment in direct financing leases
    with VAC, approximately $226,000 of leases, would be purchased from the
    Partnership by an unrelated third party for approximately $121,000
    resulting in a loss to the Partnership of $105,000.  The remaining net
    investment balance of approximately $1.7 million comprised several leases
    of equipment in the hospitality telephone industry.  This equipment,
    however, was not in service.  Based upon the best information available to
    management, it appeared the Partnership would sustain some loss with
    respect to these remaining leases.  Management's best estimate of the
    amount of the loss to the Partnership was that the Partnership may incur a
    loss of approximately $616,000 on these remaining leases.  This amount,
    therefore, together with the loss of $105,000 expected to be realized on
    the sale of the assets under the other leases, was recorded as a provision
    for possible loan and lease losses specifically related to VAC at December
    31, 1995.  During 1996, as settlement on the Partnership's claim to the
    assets under lease, $580,597 was received from sale of the assets and
    from parties to the bankruptcy.  Therefore, an additional loss of $646,307
    was recognized in the second quarter of 1996.



                                     -11-

<PAGE>   24



    On May 6, 1996, a lessee of the Partnership, United Tele-Systems of
    Virginia, Inc. ("UTS"), filed a Voluntary Petition for Relief under Chapter
    11 of the Bankruptcy Code.  The bankruptcy petition was dismissed on May
    22, 1996 and, in connection therewith, the Partnership exercised its right
    to manage the assets leased to UTS.  The net investment in the leases at
    the time the assets were repossessed was approximately $686,000.  The
    Partnership, the General Partner, an affiliated partnership and UTS were
    named in a lawsuit, filed by another creditor of UTS.  The creditor was
    claiming $360,000 in compensatory damages and $350,000 in punitive damages.
    Based on offers to purchase the pay telephone equipment and an expected
    settlement offer related to the lawsuit, the Partnership expected to incur
    a loss upon the sale or re-lease of this equipment.  Management charged
    $464,000 to the provision for possible loan and lease losses for the
    expected loss in 1996 and reclassified its net investment in the equipment,
    net of the specific allowance, to equipment under operating leases pending
    its ultimate sale or re-lease under a direct finance lease.  This equipment
    was sold during 1997 to another customer with no additional loss to the
    Partnership.  Also, the lawsuit was settled pending the outcome of an audit
    which is in process.  Management believes any loss as a result of the audit
    is adequately covered by the Partnership's general allowance.

    Due to cash flow problems experienced during 1997 by a lessee of the
    Partnership, North American Communications Group, Inc. ("NACG"), the
    Partnership, in an attempt to protect the assets leased to NACG, advanced
    funds to various entities to whom NACG owed money related to the operation
    of such leased assets.  In addition, the Partnership assisted in arranging
    a management agreement between NACG and another entity to attempt to
    improve NACG's cash flow generated by the leased assets.  In spite of the
    funds advanced by the Partnership and the management agreement, the cash
    flow of NACG continued to deteriorate.  During the past several months, the
    General Partner actively solicited bids from parties to purchase the assets
    associated with the Partnership leases to NACG.  Based on the value of
    similar assets and contract sites, management believed the equipment leased
    to NACG had substantial value.  However, the offers received were not
    adequate to cover additional funds which were required to be advanced to
    keep the equipment sites operating.  The General Partner, therefore,
    determined it was no longer economically feasible to continue to advance
    funds on behalf of NACG, discontinued doing so and informed all site
    operators of that decision.  As a result, the Partnership decided to
    provide for a specific allowance of $3,319,159 at December 31, 1997 which
    is equal to the carrying value of the leases and advances associated with
    NACG.

    The Partnership and an affiliated partnership, Telecommunications Income
    Fund IX, have initiated a foreclosure action against NACG and the
    guarantors under the leases and advances seeking sale of the assets and a
    judgment against NACG and the guarantors for any deficiency.  Amounts, if
    any, received will be credited to the allowance for possible loan and lease
    losses.

4.  EQUIPMENT HELD FOR SALE

    In May 1995, the Partnership exercised its right to manage the assets
    leased to Telecable/Continental due to nonpayment of lease receivables.  At
    the time the Partnership assumed management of these assets, its net
    investment in the leases and notes receivable approximated $2,400,000 and
    the Partnership subsequently purchased approximately $200,000 of additional
    equipment.  During 1996, $1,431,000 of this net investment was leased to an
    unrelated third party under a direct financing lease, which was paid off in
    December 1996.  The remaining net equipment cost, which had been 
    depreciated to $938,693 and relates to hotel satellite television 
    equipment, is expected by management to be recovered through the sale of
    the equipment.  Such equipment cost has been adjusted for an impairment 
    loss of $621,000 in 1996 and $205,693 in 1997, to reflect management's 
    estimated fair market value of the equipment.  The equipment was held for 
    sale by the Partnership throughout 1997.



                                     -12-

<PAGE>   25


5.  BORROWING AGREEMENTS

    The Partnership has a line-of-credit agreement with a bank which bears
    interest at a variable rate of 9.5%, 10.13% and 9.5% at December 31, 1997,
    1996 and 1995, respectively.  On March 6, 1995, the line-of-credit
    agreement was amended to increase the amount available to borrow to the
    lesser of $7.25 million, or 32% (40% as of November 1996) of Partnership's
    Qualified Accounts, as defined in the agreement.  On September 11, 1995,
    the agreement was further amended to extend the maturity date to November
    30, 1997 and to reduce the interest rate from 2.0% over prime to 1.0% over
    prime (minimum interest charge of $7,500 per month).  In addition, certain
    loan covenants were changed.  The agreement was again amended in 1997 to
    extend the maturity date to April 30, 1998 and to reduce the borrowing
    amount to the lessor of $6.0 million or 40% of qualified accounts.  The
    agreement is cancellable by the lender after giving a 90-day notice and is
    collateralized by substantially all assets of the Partnership.  The
    line-of-credit is guaranteed by the General Partner and certain affiliates
    of the General Partner.  Management is currently working with the existing
    lender to renew the line-of-credit.  Management believes amounts available
    under the line of credit are adequate for the foreseeable future.

    The Partnership also has an installment loan agreement which bears interest
    at 8.91% and is due in monthly installments through November 1998 with a
    subjective acceleration clause.  The agreement is collateralized by certain
    direct financing leases and a second interest in all other Partnership
    assets.  The agreement is also guaranteed by the General Partner.
    Covenants under the agreement require the Partnership, among other things,
    to be profitable, not exceed a 40% debt to original equity raised ratio,
    and not sell a material portion of its assets.  The Partnership has
    obtained a waiver for the covenent violation in 1997 related to the net
    loss incurred.

6.  LIMITED PARTNERSHIP AGREEMENT

    The Partnership was formed pursuant to an Agreement of Limited Partnership
    dated as of April 20, 1993 and amended August 12, 1993 (the "Agreement").
    The Agreement outlines capital contributions to be made by the partners and
    the allocation of cash distributions, net income and net loss to the
    partners.  Capital contributions by the partners to the partnership consist
    of the $10,000 contributed by the General Partner and the amounts
    contributed by limited partners for the purchase of their units.

    Net income or net loss allocated to the limited partners will be
    apportioned among them based on the number of limited partnership units
    held and on the number of months within the respective year that such units
    were held.  Any share of Partnership net loss will first be allocated to
    the limited partners to the extent of their positive capital account
    balances.  Any share of additional net loss will be allocated to the
    General Partner.  Any Partnership net income will first be allocated to
    partners with negative capital accounts in proportion to, and to the extent
    of, such negative capital accounts.  Except as provided below, any
    additional net income will then be allocated to the General Partner and
    limited partners based on number of units held.  During liquidation of the
    Partnership, when cash distributions are to be made 80% to the limited
    partners and 20% to the General Partner (see below), net income will be
    allocated 80% to the limited partners and 20% to the General Partner.

    During the Partnership's operating phase, to the extent there is cash
    available for distribution, cash distributions will be made on a monthly
    basis in the following order of priority:  first, to reimburse the General
    Partner for administrative services it provides to the Partnership, as
    further described in the Agreement (see Note 7); second, to the limited 
    partners up to amounts representing a 10.8% cumulative annual return on 
    their adjusted capital contribution (as defined); and, third, to the 
    General Partner, representing a monthly equipment management fee of 5% of
    the gross rental payments received by the Partnership (see Note 7).  To the
    extent that cash is not available to pay all or a portion of the equipment
    management fee pursuant to the above priority distributions, such fee will
    accrue and accumulate.  Any remaining cash distributions after payment of 
    the above (including arrearages) will be paid, at the discretion of the 
    General Partner, to the limited partners.


                                     -13-

<PAGE>   26



    During the Partnership's liquidation phase, cash available for distribution
    will be distributed in the following order of priority:  first, for payment
    of the General Partner's administrative services expense described above;
    second, to the limited partners for any arrearage in their 10.8% cumulative
    priority return; third, to the limited partners for 100% of their adjusted
    capital contributions; fourth, to the limited partners, distributions
    totaling 10.8% annually, noncompounded, on their adjusted capital
    contributions; fifth, to the General Partner for any arrearage in its
    equipment management fee; and, sixth, 80% to the limited partners and 20%
    to the General Partner (provided, however, that the General Partner will
    not receive such amounts unless the limited partners have received total
    distributions equal to their capital contribution plus a 10.8% annualized
    return).

7.  MANAGEMENT AND SERVICE AGREEMENTS

    The Partnership paid the General Partner 4% of all leases acquired by the
    Partnership during the initial funding period, which the Partnership
    capitalized as initial direct costs.  Amounts incurred by the Partnership
    as acquisition fees were $123,687 for 1995.  Unless the Partnership decides
    to issue additional partnership units, no further acquisition fees will be
    paid.

    The Partnership also pays an equipment management fee equal to 5% of the
    amount of gross rental payments received, to the General Partner.  The
    General Partner, in turn, pays 50% of those fees to its parent.  During the
    periods ended December 31, 1997, 1996 and 1995, those management fees
    aggregated $353,109, $387,527 and $422,866, respectively.

    In addition, the General Partner is reimbursed for certain other costs
    under an administrative services agreement.  Amounts incurred by the
    Partnership pursuant to this agreement amounted to $84,000, $73,500 and
    $85,800 for the periods ended December 31, 1997, 1996 and 1995,
    respectively.

    As a part of the issuance of partnership units, the Partnership paid
    commissions of 10% to Berthel Fisher & Company Financial Services, Inc., a
    broker-dealer affiliated with the General Partner, and reimbursed other
    offering expenses of up to 4% of the gross proceeds to the General Partner.
    These fees have been treated as syndication costs and charged directly to
    partners' equity.


                                     -14-

<PAGE>   27


8.   RECONCILIATION OF FINANCIAL AND INCOME TAX REPORTING BASIS

    A reconciliation of net income (loss) for financial reporting purposes with
    the related amount reported for income tax purposes is as follows:



<TABLE>
<CAPTION>
                                    1997                       1996                        1995
                         -------------------------    ----------------------      ----------------------
                                          PER                         PER                         PER
                           AMOUNT         UNIT         AMOUNT         UNIT         AMOUNT         UNIT
<S>                       <C>             <C>          <C>             <C>        <C>            <C>
Net income (loss) for
  financial reporting
  purposes                 $(1,897,893)   $(21.11)    $  196,197     $ 2.17       $ 1,551,153     $ 17.15
Adjustment to
  convert direct
  financing leases to
  operating leases
  for income tax
  purposes                    (587,372)     (6.53)       490,539       5.43        (3,410,299)     (37.70)
Net change in
  allowance for
  possible loan and
  lease losses               3,532,220      39.29       (865,513)     (9.57)          828,911        9.16
Gain on  lease
  terminations                (715,724)     (7.96)     1,314,157      14.54            80,355         .89
                           -----------   --------     ----------     ------       -----------   ---------
Net income (loss)
  for income tax
  reporting purposes       $   331,231    $  3.69     $1,135,380     $12.57       $  (949,880)    $(10.50)
                           ===========   ========    ===========     ======       ===========     =======
</TABLE>

9.   DISCLOSURE ABOUT FAIR VALUE OF FINANCIAL INSTRUMENTS

    The fair value amounts disclosed below are based on estimates prepared by
    management of the Partnership based on valuation methods appropriate in the
    circumstances.  Generally accepted accounting principles do not require
    disclosure for lease contracts.  The carrying amount for financial
    instruments included among cash and cash equivalents, line-of-credit
    agreement, and other short-term payables approximates their fair value
    because of the short maturity of those instruments or the variable interest
    rate feature of the instrument.  Also, the Partnership's available-for-sale
    security is reported at market value.  The estimated fair value of other
    significant financial instruments are based principally on discounted
    future cash flows at rates commensurate with the credit and interest rate
    risk involved.

    The estimated fair values of the Partnership's other significant financial
    instruments are as follows at December 31, 1997 and 1996:


<TABLE>
<CAPTION>
                              1997                               1996
                  -----------------------------     ---------------------------
                     CARRYING           FAIR           CARRYING          FAIR
                      AMOUNT            VALUE           AMOUNT          VALUE
<S>               <C>              <C>              <C>             <C>
Note payable        $  583,233       $  577,030      $1,386,361      $1,386,361
Notes receivable     1,504,510        1,504,510            -               -
</TABLE>

                                   * * * * *


                                     -15-


<PAGE>   28


ITEM 9.   CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
          FINANCIAL DISCLOSURE

          None

                                    PART III

ITEM 10.  DIRECTORS & EXECUTIVE OFFICERS OF THE REGISTRANT

          A:   The General Partner of the registrant:

               Berthel Fisher & Company Leasing, Inc., an Iowa corporation.

          B.   Executive officers of the General Partner of the Registrant:

               Thomas J. Berthel (age 46) - Mr. Berthel is the Chief Executive
Officer and Director of the General Partner, a position he has held since the
General Partner's inception in 1988. Mr. Berthel is also President and a
Director of the General Partner's parent, Berthel Fisher & Company, Inc.
("Berthel Fisher"), which he founded in 1985, and Berthel Fisher's other
subsidiaries, Berthel Fisher & Company Financial Services, Inc.; Berthel Fisher
& Company Management Corp.; Berthel Fisher & Company Planning, Inc.; and one
other corporation which acts as general partner of a separate private program.
He also serves as the Chairman of the Board and Director of Amana Colonies Golf
Course, Inc. Mr. Berthel holds a bachelor's degree from St. Ambrose College in
Davenport, Iowa (1974). From 1974 to 1982, Mr. Berthel was President and
majority shareholder of Insurance Planning Services Corporation in Maquoketa,
Iowa, which was engaged in the operation of a securities and insurance business.
Mr. Berthel holds a Financial and Operation Principal license issued by the
National Association of Securities Dealers, Inc. Mr. Berthel is also a Certified
Life Underwriter. Mr. Berthel also serves as an individual general partner of
the limited partnership referred to above. Mr. Berthel received a MBA degree
from the University of Iowa in 1993.

               Ronald O. Brendengen (age 42) - Mr. Brendengen is the Treasurer,
Chief Financial Officer, and a Director (1988 to present) of the General
Partner. He was elected to his currenet offices in October 1996. He served as
Treasurer and Chief Financial Officer since October 1996. He has also served as
Secretary (1994 - March, 1995), Treasurer (1988 - August 1995) and Chief
Financial Officer (1994 - August 1995) of the General Partner. He served as
Controller (1985-1993), Treasurer (1987-present), Chief Financial Officer,
Secretary and a Director (1987-present), and was also elected Chief Operating
Officer in January 1998, of Berthel Fisher & Company, the parent company of the
General Partner. Mr. Brendengen serves as the Treasurer, Chief Financial Officer
and a Director of Berthel Fisher & Company Planning, Inc., the trust advisor of
Berthel Growth & Income Trust I, a company required to file reports pursuant to
the Securities Exchange Act of 1934. He also serves in various offices and as a
Director of each subsidiary of Berthel Fisher & Company. Mr. Brendengen holds a
certified public accounting certificate and worked in public accounting during
1984 and 1985. From 1979 to 1984, Mr. Brendengen worked in various capacities
for Morris Plan and MorAmerica Financial Corp., Cedar Rapids, Iowa. Mr.
Brendengen attended the University of Iowa before receiving a bachelor's degree
in Accounting and Business Administration with a minor in Economics from Mt.
Mercy College, Cedar Rapids, Iowa, in 1978.


<PAGE>   29


ITEM 10.  DIRECTORS & EXECUTIVE OFFICERS OF THE REGISTRANT (CONTINUED)

          Nancy L. Lowenberg (age 39), has been elected Vice President and Chief
Operating Officer of the General Partner beginning January 2, 1997. From
September 1986 to December 1996, Ms. Lowenberg was employed by Firstar Bank
Iowa, N.A., in Cedar Rapids. Since 1989, Ms. Lowenberg was Vice President
Commercial Loans. As Vice President Commercial Loans, she was relationship
manager for 62 accounts with approximately $70,000,000 of committed credit. She
had responsibility for credit quality, annual review and maintenance of existing
accounts and business development. From 1981-1986, Ms. Lowenberg was employed by
Firstar Bank Systems. Ms. Lowenberg received her Bachelor of Science
Agricultural Business with a minor in Finance in 1981 from Iowa State
University, Ames, Iowa.


<PAGE>   30


ITEM 11.  EXECUTIVE COMPENSATION

          Set forth is the information relating to all direct renumeration paid
          or accrued by the Registrant during the last three years to the
          General Partner:

<TABLE>
<CAPTION>
(A)                        (B)                       (C)                        (C1)             (C2)              (D)

                                                                                                 Securities of
                                                                                                 property
                                                                                                 insurance         Aggregate
                                                                                                 benefits or       of
                                                     Cash and Cash                               reimbursement     contingent
Name of individual         Year                      equivalent forms                            personal          or forms of
and capacities served     Ended                      of remuneration            Fees             benefits          remuneration
-------------------------------------------------------------------------------------------------------------------------------
<S>                        <C>                       <C>                     <C>                <C>                <C>   
Berthel Fisher & Co.       1997                              $0               $437,109                   $0                   $0
Leasing, Inc.              1996                              $0               $453,165                   $0                   $0
General Partner            1995                              $0               $632,353                   $0                   $0
</TABLE>



<PAGE>   31


ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     (a)  No person owns of record, or is known by the Registrant to own
          beneficially, more than five percent of the Partnership Units.

     (b)  The General Partner of the Registrant owns Units of the Registrant set
          forth in the following table.


<TABLE>
<CAPTION>
       (1)                          (2)                                (3)                                (4)

                           Name and Address of                Amount and Nature of
Title of Class             Beneficial Ownership               Beneficial Ownership            Percent of Class
--------------             --------------------               --------------------            ----------------
<S>                        <C>                                <C>                             <C>             
         Units             Berthel Fisher & Co.               Forty (40) Units;                  0.04%
                           Leasing, Inc.                      sole owner.
                           100 2nd Street S.E.
                           Cedar Rapids, IA 52401
</TABLE>

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

          Related party transactions are described in Notes 2 and 7 of Notes to
          Financial Statements.



<PAGE>   32
                                     PART IV

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

     (a)  1.  Financial Statements.
                                                                        Page No.
              Balance Sheets at December 31, 1997 and
              December 31, 1996                                            14



              Statements of Operations for the years ended December
              31, 1997, December 31, 1996 and December 31, 1995            15



              Statements of Changes in Partners' Equity for the years
              ended December 31, 1997, December 31, 1996 and
              December 31, 1995                                            16


              Statements of Cash Flows for the years ended December
              31, 1997, December 31, 1996 and December 31, 1995            17

              Notes to Financial Statements                                19

          2.  Financial Statements Schedules

          Information pursuant to Rule 12-09 (Schedule II) is included in the
          financial statements and notes thereto.

          3.   Exhibits

               3,4 Amended and Restated Agreement of Telecommunications Income 
               Fund X, L.P. currently in effect dated as of August 19, 1993(1)

----------------------------------

     (1) Incorporated herein by reference to Exhibit A in the Partnership's
registration statement on Form S-1, effective August 27, 1993


<PAGE>   33


                                   SIGNATURES

       Pursuant to the requirements of Section 13 or 15(d) 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.

                     TELECOMMUNICATIONS INCOME FUND X, L.P.
                     --------------------------------------
                                  (REGISTRANT)

By Berthel Fisher & Company Leasing, Inc.

By:    Thomas J. Berthel/s/                           Date:    March 12, 1998
   --------------------------------------                  -------------------
Thomas J. Berthel
President

By Berthel Fisher & Company Leasing, Inc.

By:    Ronald O. Brendengen/s/                       Date:   March 12, 1998
   --------------------------------------                 --------------------
Ronald O. Brendengen
Chief Financial Officer, Treasurer

       Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.

Thomas J. Berthel/s/                                 Date:    March 12, 1998
-----------------------------------------                 --------------------
Thomas J. Berthel
Chief Executive Officer
President, Director
Berthel Fisher & Company Leasing, Inc.
Corporate General Partner

Nancy L, Lowenberg/s/                                Date:   March 12, 1998
-----------------------------------------                 --------------------
Nancy L. Lowenberg
Chief Operating Officer, Director
Berthel Fisher & Company Leasing, Inc.
Corporate General Partner

Ronald O. Brendengen/s/                              Date:    March 12, 1998
-----------------------------------------                 --------------------
Ronald O. Brendengen
Treasurer, Director
Berthel Fisher & Company Leasing, Inc.
Corporate General Partner

Daniel P. Wegmann/s/                                 Date:    March 12, 1998
-----------------------------------------                 --------------------
Daniel P. Wegmann
Controller
Berthel Fisher & Company Leasing, Inc.
Corporate General Partner


<PAGE>   34


                                  EXHIBIT INDEX

                  3,4    Amended and Restated Agreement of
                         Telecommunications Income Fund IX, L.P. currently in
                         effect dated as of August 12, 1991 (1)



----------------------------------



                  (1)    Incorporated herein by reference to Partnership
                         Exhibit A to the prospectus included in the
                         Partnership's post effective amendment No. 4 to Form
                         S-1 registration statement filed on December 22, 1992.