<PAGE>

                 PART I. - FINANCIAL INFORMATION
              CONSOLIDATED RESOURCES HEALTH CARE FUND IV
                     CONSOLIDATED BALANCE SHEETS
                             (Unaudited)


                                         September 30,   December 31,
                                             1997            1996
                                        -------------- ----------------

ASSETS
Current assets:
  Cash and cash equivalents              $    784,086  $       723,569
  Accounts receivable and
   third party settlement                           -          165,545
  Prepaid expenses                             23,755              901
  Property held for sale                            -          613,198
                                       --------------- ----------------
    Total current assets                      807,841        1,503,213
                                       --------------- ----------------

  Restricted escrows and other deposits             -           46,979
  
                                       --------------- ----------------
    Total other assets                              -           46,979
                                       --------------- ----------------
                                         $    807,841  $     1,550,192
                                       =============== ================
LIABILITIES AND PARTNERS' DEFICIT
Current liabilities:
  Current maturities of long-term
   obligations including debt in default $          -  $     1,656,836
  Trade accounts payable                       11,637          156,163
  Accrued compensation                              -          103,960
  Insurance payable                                 -           58,062
  Accrued interest                                  -           17,916
  Accrued real estate taxes                         -           29,455
                                        --------------   --------------
    Total current liabilities                  11,637        2,022,392


Partners' equity (deficit):
  Limited partners                          1,428,706          211,038
  General partners                           (632,502)        (683,238)
                                       --------------- ----------------
    Total partners' equity                    796,204         (472,200)
                                       --------------- ----------------
                                         $    807,841  $     1,550,192
                                       =============== ================


<PAGE>

                   CONSOLIDATED RESOURCES HEALTH CARE FUND IV
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)
<TABLE>
<CAPTION>


                                   Three Months Ended           Nine Months Ended
                                     September 30,                September 30,
                                   1997          1996           1997          1996
                              ------------- -------------  -------------  ------------
<S>                           <C>            <C>           <C>           <C>
Revenues:
  Operating revenues          $    316,295   $    992,651  $  1,992,480  $   2,718,399
  Interest income                    6,527          5,833        19,074         15,457
                              -------------  ------------- ------------- --------------
    Total revenues                 322,822        998,484     2,011,554      2,733,856
                              -------------  ------------- ------------- --------------

Expenses:
  Operating expenses               302,909        810,664     1,806,994      2,323,064
  Interest                          13,098         39,515       120,522        123,750
  Depreciation and amortization     13,027         39,081        91,190        152,175
  Partnership administration
     costs                          15,273         14,562       104,849        147,074
                              -------------  ------------- ------------- --------------
    Total expenses                 344,307        903,822     2,123,555      2,746,063
                              -------------  ------------- ------------- --------------
Income (Loss) before gain          (21,485)        94,662      (112,001)       (12,207)

Gain on sale of
   properties (Note 5)           1,380,405              -     1,380,405              -

                              -------------  ------------- ------------- --------------
Net income (loss)             $  1,358,920  $      94,662 $   1,268,404 $      (12,207)
                              =============  ============= ============= ==============

Net income(loss) per L.P. unit
   before property gain       $     (0.78)          3.46         (4.09)          (0.45)

Gain on properties 
   per L.P unit                     52.00              -         52.00               -

Net income(loss) per L.P. unit      49.64           3.46         46.33           (0.45)
                              =============  ============= ============= ==============

L.P. units outstanding              26,283         26,283        26,283         26,283
                              =============  ============= ============= ==============
</TABLE>





          See accompanying notes to consolidated financial statements.

<PAGE>

          CONSOLIDATED RESOURCES HEALTH CARE FUND IV
              CONSOLIDATED STATEMENTS OF CASH FLOWS
                           (Unaudited)


                                                 Nine months ended September 30,
                                                      1997            1996
                                                  ------------- ---------------

Operating Activities:
  Cash received from residents
     and government agencies                    $    2,158,025  $    2,761,487
  Cash paid to suppliers and employees              (2,270,700)     (2,540,907)
  Cash paid to restricted escrows                       46,979           6,037
  Interest received                                     19,074          15,457
  Interest paid                                       (138,438)       (113,890)
                                                  ------------- ---------------
Cash provided by (used in) operating activities       (185,060)        128,184
                                                   ------------- ---------------

Investing Activities:
  Additions to property and equipment
     held for sale                                    (121,278)        (30,745)
Proceeds from sale of properties                     2,023,691               -
                                                  --------------- -------------
Cash provided by (used in) investing activites       1,902,413         (30,745)
                                                  ------------- ---------------

Financing Activities:
  Principal payments on long-term obligations       (1,656,836)        (70,204)
                                                  ------------- ---------------
Cash (used in) financing activities                 (1,656,836)        (70,204)
                                                  ------------- ---------------

Net increase (decrease) in  cash
     and cash equivalents                               60,517          27,235

Cash and cash equivalents, beginning of period         723,569         628,543
                                                  ------------- ---------------

Cash and cash equivalents, end of period         $     784,086  $      655,778
                                                  ============= ===============







          See accompanying notes to consolidated financial statements.
<PAGE>

            CONSOLIDATED RESOURCES HEALTH CARE FUND IV
              CONSOLIDATED STATEMENTS OF CASH FLOWS
                           (Unaudited)


                                     Nine months ended September 30,
                                         1997            1996
                                    --------------- ---------------

Reconciliation of Net Loss
  to Cash (Used in) Operating
  Activities:

Net income (loss)                   $    1,268,404 $       (12,207)
Adjustments to reconcile net (loss)
   to cash (used in) operating
   activities:
      Depreciation and amortization         91,190         152,175
      Gain on sale of properties        (1,380,405)              -
Changes in assets and liabilities:
      Accounts receivable                  165,545          43,088
      Other assets                         (22,854)        (59,833)
      Restricted escrow and other deposits  46,979           6,037
      Trade accounts payable and
        accrued liabilities               (353,919)         (1,076)
                                    --------------- ---------------

Cash provided by (used in)
    operating activities            $     (185,060) $      128,184
                                    =============== ===============





          See accompanying notes to consolidated financial statements.
<PAGE>


               CONSOLIDATED RESOURCES HEALTH CARE FUND IV
            CONSOLIDATED STATEMENTS OF PARTNERS' EQUITY (DEFICIT)
                                 (Unaudited)

                                                                   Total
                                                                   Partners'
                                  General         Limited          Deficit
                              --------------- ----------------- ---------------

Balance, at December 31, 1995  $    (673,996) $        432,856  $     (241,140)

Net loss                                (488)          (11,719)        (12,207)
                               -------------- ----------------- ---------------

Balance, at September 30, 1996  $   (674,484) $        421,137  $    (253,347)
                               ============== ================= ===============


Balance, at December 31, 1996  $    (683,238) $        211,038  $     (472,200)

Net income                            50,736         1,217,668        1,268,404
                               -------------- ----------------- ---------------

Balance, at September 30, 1997  $   (632,502) $      1,428,706  $       796,204
                               ============== ================= ===============






          See accompanying notes to consolidated financial statements.
<PAGE>






                   CONSOLIDATED RESOURCES HEALTH CARE FUND IV
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                               September 30, 1997
NOTE 1.

     The  consolidated  financial  statements  are  unaudited  and  reflect  all
adjustments  (consisting only of normal recurring adjustments) which are, in the
opinion  of  management  necessary  for a fair  presentation  of  the  financial
position  and  operating  results  for  the  interim  periods.  The  results  of
operations  for the nine months ended  September 30, 1997,  are not  necessarily
indicative of the results to be expected for the year ending December 31, 1997.

NOTE 2.

     The consolidated  financial  statements  should be read in conjunction with
the  consolidated  financial  statements and the notes thereto  contained in the
Partnership's  Annual Report on Form 10-K for the year ended  December 31, 1996,
as  filed  with  the  Securities  and  Exchange  Commission,  a copy of which is
available  upon  request  by  writing to  WelCare  Service  Corporation-IV  (the
"Managing  General  Partner"),  at 400  Perimeter  Center  Terrace,  Suite  650,
Atlanta, Georgia, 30346.

NOTE 3.

     A  summary  of  compensation  paid to or  accrued  for the  benefit  of the
Partnership's  general partners and their affiliates and amounts  reimbursed for
costs incurred by these parties on the behalf of the Partnership are as follows:
                                                       Nine Months Ended
                                                          September 30,
                                                         1997      1996

Charged to costs and expenses:
Property management and oversight
management fees                                       $ 113,860   $ 162,928
Financial accounting, data processing,
tax reporting, legal and compliance,
investor relations and supervision
of outside services                                   $ 29,125    $  45,116
 

NOTE 4:

     Effective  July  31,1997,  the  Partnership  closed  the  sale  of its  two
remaining skilled nursing facilities  Heritage Manor of Emporia  ("Emporia") and
Hoisington  Rehabilitation  Center  ("Hoisington")  effective July 31, 1997. The
total sales price for both  facilities net of required  repairs was  $2,050,000.
Proceeds from the sale were used to satisfy approximately $1,640,000 in mortgage
debt  obligations  secured  by the  facilities.  The  Partnership  received  net
proceeds of  approximately  $380,000  following the satisfaction of the debt and
payment of sales expenses and property taxes. The Partnership  recognized a gain
on sale of approximately $1,380,000 during the third quarter of 1997.

     Prior to their repayment,  the  Partnership's two mortgage debt obligations
secured by  Emporia  and  Hoisington  were in default  since  these  obligations
matured on April 1, 1996. The Partnership  obtained an extension from the lender
to allow for the sale of the facilities. In consideration for the extension, the
Partnership paid the lender $50,000 on January 31, 1997.

ITEM 2.  MANAGEMENT'S  DISCUSSION  AND ANALYSIS OF FINANCIAL  CONDITION AND
         RESULTS OF OPERATIONS

     Certain statements contained in this Management Discussion and Analysis are
not based on historical facts, but are forward-looking statements that are based
upon numerous  assumptions  about future conditions that may ultimately prove to
be inaccurate.  Actual events and results may materially differ from anticipated
results described in such statements.  The Partnership's ability to achieve such
results  is  subject  to  certain  risks  and  uncertainties.   Such  risks  and
uncertainties   include,   but  are  not  limited  to,   changes  in  healthcare
reimbursement systems and rates, the availability of prospective  purchasers for
its facilities,  and other factors affecting the Partnership's business that may
be beyond its control.
     At September 30, 1997,  the  Partnership  had three  general  partners (the
"General Partners"),  WelCare Consolidated  Resources  Corporation of America, a
Nevada  corporation,  serving as the corporate  general partner  ("WCRCA" or the
"Corporate  General Partner"),  Consolidated  Associates IV, and WelCare Service
Corporation-IV   ("WSC-IV"  or  the  "Managing  General  Partner"),   a  Georgia
Corporation, serving as managing general partner.


Plan of Operations

     A majority in interest of the  Partnership's  Limited  Partners  approved a
proposal,  on  October  18,  1994,  which  provides  for the  sale of all of the
Partnership's  remaining assets and the eventual dissolution of the Partnership,
as outlined in a proxy statement  dated  September 28, 1994.  Under the approved
proposal,  the Limited  Partners  consented for the Managing  General Partner to
attempt to sell or  otherwise  dispose  of its  remaining  properties.  Upon the
disposition  of all of its  assets,  the  approved  proposal  requires  that the
Managing General Partner dissolve the Partnership.
     As  discussed  in Item 1, Note 4, the  Partnership  sold its two  remaining
facilities  and satisfied the underlying  mortgage debt  obligations on July 31,
1997.  On October 1,  1997,  the  Partnership  distributed  $450,000  in a final
distribution to its Limited  Partners.  The Managing  General Partner  currently
anticipates the Partnership  will be dissolved  following  issuance of final tax
statements to the partners during the first quarter of 1998.
     At December 31, 1996,  the  Partnership  held available for sale all of its
nursing  home  facilities.  Accordingly,  the  Partnership  has  classified  the
facilities as Property held for sale in the accompanying balance sheet.

Results of Operations

Revenues:

     Operating revenue decreased by $676,356 for the quarter ended September 30,
1997,  compared to the same period in the prior year. This significant  decrease
was caused  primarily by the sale of the  Partnership's  two  remaining  nursing
facilities on July 31, 1997. Due to the sale, only one month's operating results
were  included in the third  quarter of the current  year,  as compared to three
month's of operating results for the same period in the prior year.

Expenses:

     Operating  expenses  decreased by $507,755 for the quarter ended  September
30,  1997,  as compared to the same period in the prior year.  This  significant
decrease was caused  primarily by the sale of the  Partnership's  two  remaining
nursing facilities on July 31, 1997. Due to the sale, only one month's operating
results were  included in the third  quarter of the current year, as compared to
three month's of operating results for the same period in the prior year.
Liquidity and Capital Resources

     At September 30, 1997, the  Partnership  held cash and cash  equivalents of
$784,086 an increase of $60,517 from the amount held at December  31, 1996.  The
cash  balance  is being  held in  reserve  to  satisfy  anticipated  partnership
expenses to be incurred prior to dissolving the Partnership.
 
     On October 1, 1997,  the  Partnership  distributed  $450,000 to the Limited
Partners representing a final distribution.




PART II - OTHER INFORMATION


Item 6.    Exhibits and Reports on Form 8-K

(a)        Exhibits

27.1       Financial Data Schedule (for SEC use only)
 
(b)        Reports on Form 8-K

                      None

<PAGE>



                                   SIGNATURES

Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned, thereunto duly authorized.

                   CONSOLIDATED RESOURCES HEALTH CARE FUND IV

                      By: WELCARE SERVICE CORPORATION - IV
                          Managing General Partner



Date: November 14, 1997            By:  /s/ J. Stephen Eaton
---------------------                 -------------------------
                                       J.Stephen Eaton,
                                       President
 


Date: November 14, 1997            By:  /s/ Alan C. Dahl
---------------------                 -------------------------
                                       Alan C.Dahl,
                                       Chief Financial Officer
                                       of the Corporate
                                       General Partner