FORM 10-K

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                   (Mark One)

  |X| ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                                  ACT OF 1934

                    For the fiscal year ended March 31, 2003

                                       OR

     |_| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
                              EXCHANGE ACT OF 1934

             For the transition period from __________ to __________

                         Commission file number: 0-23908


                  WNC CALIFORNIA HOUSING TAX CREDITS III, L.P.

                     California                                  33-0563307
                   (State or other jurisdiction of            (I.R.S. Employer
                  incorporation or organization)             Identification No.)

              3158 Redhill Avenue, Suite 120, Costa Mesa, CA 92626

                                 (714) 662-5565

           Securities registered pursuant to Section 12(b) of the Act:

                                      NONE

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

                      UNITS OF LIMITED PARTNERSHIP INTEREST

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            No       X
    ----------    ---------

Indicate by check mark if disclosure of delinquent  filers  pursuant to Item 405
of Regulation  S-K 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|

                                       1
<PAGE>


Indicate by check mark whether the registrant is an accelerated filer.
Yes               No      X
    -----------      ---------------

State the aggregate market value of the voting and non-voting common equity held
by non-affiliates  computed by reference to the price at which the common equity
was last sold, or the average bid and asked price of such common  equity,  as of
the last business day of the registrant's most recently  completed second fiscal
quarter.

                                  INAPPLICABLE


                       DOCUMENTS INCORPORATED BY REFERENCE

List hereunder the following documents if incorporated by reference and the Part
of the Form 10-K  (e.g.,  Part I, Part II,  etc.)  into  which the  document  is
incorporated:  (1) Any  annual  report  to  security  holders;  (2) Any proxy or
information  statement;  and (3) Any prospectus filed pursuant to Rule 424(b) or
(c) under the  Securities Act of 1933.  The listed  documents  should be clearly
described for identification  purposes (e.g.,  annual report to security holders
for fiscal year ended December 24, 1980).

                                      NONE



                                       2
<PAGE>


PART I.

Item 1.  Business

Organization

WNC California  Housing Tax Credits III, L.P. ("CHTC III" or the  "Partnership")
is a  California  limited  partnership  formed  under  the laws of the  State of
California on October 5, 1992.  The  Partnership  was formed to acquire  limited
partnership  interests  in  other  limited  partnerships  or  limited  liability
companies ("Local Limited Partnerships") which own multifamily housing complexes
that are  eligible  for  low-income  housing  federal  and,  in  certain  cases,
California income tax credits ("Low Income Housing Credits").

The general partner of the Partnership is WNC Tax Credit Partners III, L.P. (the
"General  Partner"  or  "TCP  III").  The  general  partner  of TCP III is WNC &
Associates,  Inc.  ("Associates").  The chairman and president own substantially
all of the outstanding  stock of Associates.  The business of the Partnership is
conducted primarily through WNC, as the Partnership has no employees of its own.

Pursuant to a  registration  statement  filed with the  Securities  and Exchange
Commission, on February 17, 1993, the Partnership commenced a public offering of
30,000 Units of Limited Partnership  Interest ("Units") at a price of $1,000 per
Unit.  As of the close of the offering on July 22, 1994, a total of 18,000 Units
representing  $18,000,000 had been sold. Holders of Units are referred to herein
as "Limited Partners."

Description of Business

The  Partnership's  principal  business  objective  is to  provide  its  Limited
Partners with Low Income Housing Credits.  The Partnership's  principal business
therefore  consists of investing as a limited partner or non-managing  member in
Local  Limited  Partnerships  each of which will own and operate a  multi-family
housing complex (the "Housing  Complexes") which will qualify for the Low Income
Housing Credit.  In general,  under Section 42 of the Internal  Revenue Code, an
owner of low-income housing can receive the Low Income Housing Credit to be used
to reduce  Federal  taxes  otherwise due in each year of a ten-year  period.  In
general,  under Section 17058 of the  California  Revenue and Taxation  Code, an
owner of low-income housing can receive the Low Income Housing Credit to be used
against California taxes otherwise due in each year of a four-year period.  Each
Housing Complex is subject to a fifteen-year  compliance period (the "Compliance
Period"),  and under state law may have to be maintained  as low income  housing
for 30 or more years.

In general,  in order to avoid  recapture  of Low Income  Housing  Credits,  the
Partnership  does not  expect  that it will  dispose of its  interests  in Local
Limited Partnerships ("Local Limited Partnership Interests") or approve the sale
by any Local Limited  Partnership of its Housing Complex prior to the end of the
applicable  Compliance  Period.  Because  of  (i)  the  nature  of  the  Housing
Complexes,  (ii) the  difficulty of predicting  the resale market for low-income
housing  15 or more years in the  future,  and (iii) the  ability of  government
lenders to  disapprove  of transfer,  it is not possible at this time to predict
whether the liquidation of the  Partnership's  assets and the disposition of the
proceeds,  if any, in  accordance  with the  Partnership's  Agreement of Limited
Partnership,  dated October 1992 (the "Partnership Agreement"),  will be able to
be accomplished  promptly at the end of the 15-year  period.  If a Local Limited
Partnership is unable to sell its Housing  Complex,  it is anticipated  that the
local general partner ("Local General  Partner") will either continue to operate
such Housing  Complex or take such other  actions as the Local  General  Partner
believes  to  be  in  the  best  interest  of  the  Local  Limited  Partnership.
Notwithstanding the preceding,  circumstances  beyond the control of the General
Partner or the Local General  Partners may occur during the  Compliance  Period,
which would  require the  Partnership  to approve the  disposition  of a Housing
Complex prior to the end thereof,  possibly resulting in recapture of Low Income
Housing Credits.

                                       3
<PAGE>


As of March 31, 2003,  the  Partnership  had invested in eighteen  Local Limited
Partnerships.  Each of these Local Limited  Partnerships  owns a Housing Complex
that is eligible  for the federal  Low Income  Housing  Credit and eight of them
were  eligible for the  California  Low Income  Housing  Credit.  Certain  Local
Limited Partnerships may also benefit from government programs promoting low- or
moderate-income housing.

Certain Risks and Uncertainties

An investment in the  Partnership  and the  Partnership's  investments  in Local
Limited  Partnerships  and their Housing  Complexes are subject to risks.  These
risks may impact the tax benefits of an investment in the  Partnership,  and the
amount of proceeds  available for distribution to the Limited Partners,  if any,
on liquidation of the Partnership's investments. Some of those risks include the
following:

The Low Income  Housing  Credit rules are extremely  complicated.  Noncompliance
with these rules results in the loss of future Low Income  Housing  Credit s and
the fractional  recapture of Low Income Housing  Credits  already taken. In most
cases the annual amount of Low Income Housing Credits that an individual can use
is limited to the tax  liability  due on the  person's  last  $25,000 of taxable
income.  The  Local  Limited  Partnerships  may be  unable  to sell the  Housing
Complexes at a profit. Accordingly,  the Partnership may be unable to distribute
any cash to its investors.  Low Income  Housing  Credits may be the only benefit
from an investment in the Partnership.

The Partnership has invested in a limited number of Local Limited  Partnerships.
Such  limited  diversity  means that the  results of  operation  of each  single
Housing  Complex  will have a greater  impact on the  Partnership.  With limited
diversity,   poor   performance   of  one  Housing   Complex  could  impair  the
Partnership's ability to satisfy its investment objectives. Each Housing Complex
is subject to mortgage  indebtedness.  If a Local Limited  Partnership failed to
pay its  mortgage,  it  could  lose  its  Housing  Complex  in  foreclosure.  If
foreclosure  were to occur during the first 15 years,  the loss of any remaining
future Low Income Housing  Credits,  a fractional  recapture of prior Low Income
Housing  Credits,  and a loss of the  Partnership's  investment  in the  Housing
Complex would occur. The Partnership is a limited partner or non-managing member
of each Local Limited Partnership.  Accordingly,  the Partnership will have very
limited rights with respect to management of the Local Limited Partnerships. The
Partnership  will  rely  totally  on the Local  General  Partners.  Neither  the
Partnership's  investments in Local Limited Partnerships,  nor the Local Limited
Partnerships'  investments in Housing Complexes, are readily marketable.  To the
extent  the  Housing  Complexes  receive   government   financing  or  operating
subsidies,  they  may be  subject  to  one  or  more  of  the  following  risks:
difficulties  in obtaining  tenants for the Housing  Complexes;  difficulties in
obtaining  rent  increases;  limitations on cash  distributions;  limitations on
sales or refinancing of Housing Complexes; limitations on transfers of interests
in Local Limited Partnerships; limitations on removal of Local General Partners;
limitations on subsidy programs; and possible changes in applicable regulations.
Uninsured  casualties  could result in loss of property  and Low Income  Housing
Credits and recapture of Low Income Housing Credits  previously taken. The value
of real  estate  is  subject  to risks  from  fluctuating  economic  conditions,
including employment rates, inflation,  tax, environmental,  land use and zoning
policies, supply and demand of similar properties,  and neighborhood conditions,
among others.

The  ability of Limited  Partners to claim tax losses  from the  Partnership  is
limited.  The IRS may audit the  Partnership or a Local Limited  Partnership and
challenge  the tax  treatment  of tax items.  The  amount of Low Income  Housing
Credits and tax losses  allocable to the  investors  could be reduced if the IRS
were successful in such a challenge.  The  alternative  minimum tax could reduce
tax benefits from an investment  in the  Partnership.  Changes in tax laws could
also impact the tax benefits from an investment  in the  Partnership  and/or the
value of the Housing Complexes.

No trading market for the Units exists or is expected to develop.  Investors may
be unable to sell their Units  except at a discount  and should  consider  their
Units to be a long-term  investment.  Individual investors will have no recourse
if they  disagree  with actions  authorized by a vote of the majority of Limited
Partners.

Exit Strategy

The IRS  compliance  period for  low-income  housing  tax credit  properties  is
generally  15 years from  occupancy  following  construction  or  rehabilitation
completion.  WNC was one of the first in the industry to offer investments using
the tax credit.  Now these very first programs are completing  their  compliance
period.

                                       4
<PAGE>


With that in mind, we are continuing our review of the  Partnership's  holdings,
with special  emphasis on the more mature  properties  including those that have
satisfied the IRS compliance requirements. Our review will consider many factors
including  extended  use  requirements  on the  property  (such as those  due to
mortgage  restrictions  or state  compliance  agreements),  the condition of the
property,  and  the tax  consequences  to the  investors  from  the  sale of the
property.

Upon identifying  those  properties with the highest  potential for a successful
sale, refinancing or syndication, we expect to proceed with efforts to liquidate
those  properties.  Our objective is to maximize the investors'  return wherever
possible and,  ultimately,  to wind down those funds that no longer  provide tax
benefits  to  investors.  To date no  properties  in the  Partnership  have been
selected.

Item 2.  Properties

Through its investments in Local Limited  Partnerships,  the  Partnership  holds
limited  partnership  interests in the Housing  Complexes.  The following  table
reflects  the status of the eighteen  Housing  Complexes as of the dates and for
the periods indicated:


                                       5
<PAGE>
<TABLE>
<CAPTION>



                                                  ---------------------------------- -----------------------------------------------
                                                        As of March 31, 2003                       As of December 31, 2002
                                                  ---------------------------------- -----------------------------------------------
                                                      Partnership's                                  Estimated Low      Encumbrances
                                                     Total Investment    Amount of                        Income          of Local
                                   General Partner   in Local Limited    Investment  Number of            Housing          Limited
Partnership Name     Location          Name             Partnerships    Paid to Date   Units  Occupancy  Credits        Partnerships
------------------------------------------------------------------------------------------------------------------------------------
<S>                   <C>           <C>                   <C>            <C>            <C>      <C>     <C>             <C>
Almond
Garden
Apartment            Delhi,        Anthony
Associates           California    Donovan                $  391,000     $  391,000     34       100%    $  807,000      $ 1,376,000

Almond View
Apartments,          Stockton,     Daniel C. Logue and
Ltd.                 California    Cyrus Youssefi          1,639,000      1,639,000     72        99%     3,523,000        1,746,000

Buccaneer            Fernandia
Associates,          Beach,        Clifford E.
Limited              Florida       Olsen                     365,000        365,000     48       100%       768,000        1,462,000

Candleridge
Apartments of        Perry,        Eric A.
Perry L.P. II        Iowa          Sheldahl                  126,000        126,000     24       100%       245,000          691,000

                                   S.P. Thomas
                                   Company of
                                   Northern
Colonial                           California
Village              Roseville,    Inc. and
Roseville            Calfornia     Project Go, Inc.         2,811,000     2,811,000     56       100%     5,872,000        2,012,000

Dallas                             Thomas H. Cooksey
County               Orrville,     and Apartment
Housing,Ltd.         Alabama       Developers, Inc.           130,000       130,000     19       100%       287,000          609,000

La Paloma del
Sol Limited          Deming,
Partnership          New Mexico    Dean Greenwalt             254,000       254,000     38        87%       625,000        1,419,000

Memory Lane          Yankton,
Limited              South         Skogen - Peterson
Partnership          Dakota        Inc.                       151,000       151,000     18       100%       295,000          676,000

                                   Self-Help
Nueva Sierra                       Enterprises, Inc.
Vista                Richgrove,    and Nueva Sierra
Associates           California    Vista Corporation        1,688,000     1,688,000     35       100%     3,516,000        1,626,000

</TABLE>

                                       6
<PAGE>

<TABLE>
<CAPTION>

                                                  ---------------------------------- -----------------------------------------------
                                                        As of March 31, 2003                       As of December 31, 2002
                                                  ---------------------------------- -----------------------------------------------
                                                      Partnership's                                  Estimated Low      Encumbrances
                                                     Total Investment    Amount of                        Income          of Local
                                   General Partner   in Local Limited    Investment  Number of            Housing          Limited
Partnership Name     Location          Name             Partnerships    Paid to Date   Units  Occupancy  Credits        Partnerships
------------------------------------------------------------------------------------------------------------------------------------
<S>                  <C>           <C>                    <C>          <C>                <C>     <C>  <C>              <C>
Old Fort                           Alan Deke Noftsker
Limited              Hidalgo,      and  ABO
Partnership          Texas         Corporation                249,000       249,000     40        97%       547,000        1,265,000

Orosi
Apartments,          Orosi,        Douglas W.
Ltd.                 California    Young                      461,000       461,000     42       100%       902,000        1,915,000

                                   David J. Micheal
Parlier                            and Proffesional
Garden               Parlier,      Apartment
Apts.                California    Management, Inc.           453,000       453,000     41       100%       917,000        1,693,000

Rosewood
Apartments                         Duffy
Limited              Superior,     Development
Partnership          Wisconsin     Company, Inc.              185,000       185,000     20       100%       375,000          470,000

Sun Manor,           Itta Bena,    Glenn D.
L.P.                 Mississippi   Miller                     230,000       230,000     36       100%       464,000        1,048,000

                                   David J. Michael,
                                   Bucky Fong, Dean
Tahoe                South Lake    Pearson, Coy Elvis
Pines                Tahoe,        and Dr. Patricia
Apartments           California    Hatton                   1,633,000     1,633,000     28       100%     3,171,000        1,655,000

Venus
Retirement
Village,             Venus,        W. Joseph
Ltd.                 Texas         Chamy                      161,000       161,000     24        96%       318,000          719,000

Walnut               Orange,       Walnut -
Pixley, L.P.         California    Pixley, Inc.             1,078,000     1,078,000     22        95%     2,309,000          993,000

Winters
Investment           Winters,      John P.
Group                California    Casper                     531,000       531,000     38        97%     1,072,000        1,818,000
                                                          ------------ -------------  ----      ------ ------------     ------------

                                                          $12,536,000  $ 12,536,000    635        98%  $ 26,013,000     $ 23,193,000
                                                          ============ =============   ===      ====== ============      ===========
</TABLE>


                                       7
<PAGE>
<TABLE>
<CAPTION>


                                          --------------------------------------------------------------------------
                                                            For the year ended December 31, 2002
                                          --------------------------------------------------------------------------
                                                                                                   Low Income
                                                                                                Housing Credits
                                                                                                  Allocated to
             Partnership Name                 Rental Income        Net Income (Loss)              Partnership
 -------------------------------------------------------------------------------------------------------------------
<S>                                                    <C>                   <C>                                <C>
 Almond Garden Apartment Associates                    $ 167,000             $ (41,000)                         99%

 Almond View Apartments, Ltd.                            229,000              (238,000)                         99%

 Buccaneer Associates, Limited                           231,000               (41,000)                         99%

 Candleridge Apartments of Perry L.P. II                 157,000               (12,000)                         99%

 Colonial Village Roseville                              463,000               (57,000)                         99%

 Dallas County Housing, Ltd.                              81,000                (9,000)                         99%

 La Paloma del Sol Limited Partnership                   157,000               (32,000)                         99%

 Memory Lane Limited Partnership                          80,000                (3,000)                         99%

 Nueva Sierra Vista Associates                           154,000              (146,000)                         99%

 Old Fort Limited Partnership                            168,000               (40,000)                         99%

 Orosi Apartments, Ltd.                                  198,000               (32,000)                         99%

 Parlier Garden Apts.                                    228,000               (24,000)                         95%

 Rosewood Apartments Limited Partnership                  88,000                 5,000                          99%

 Sun Manor, L.P.                                         144,000               (27,000)                         99%

 Tahoe Pines Apartments                                  187,000              (178,000)                         99%

 Venus Retirement Village, Ltd.                           90,000               (21,000)                         99%

 Walnut - Pixley, L.P.                                   161,000               (25,000)                         99%

 Winters Investment Group                                218,000               (41,000)                         99%
                                                     ------------           -----------
                                                     $ 3,201,000            $ (962,000)
                                                     ============           ===========
</TABLE>


                                       8
<PAGE>



Item 3.  Legal Proceedings

NONE.

Item 4.  Submission of Matters to a Vote of Security Holders

NONE

PART II.

Item 5. Market for Registrant's Common Equity and Related Stockholder Matters

Item 5a.

(a)  The  Units  are not  traded on a public  exchange  but were sold  through a
     public offering.  It is not anticipated that any public market will develop
     for the  purchase  and  sale of any  Unit and  none  exists.  Units  can be
     assigned  only if certain  requirements  in the  Partnership  Agreement are
     satisfied.

(b)  At March 31, 2003, there were 909 Limited Partners.

(c)  The Partnership was not designed to provide cash  distributions  to Limited
     Partners in  circumstances  other than  refinancing  or  disposition of its
     investments in Local Limited Partnerships.

(d)  No unregistered securities were sold by the Partnership during the year
     ended March 31, 2003.

Item 5b.

NOT APPLICABLE

Item 6.  Selected Financial Data

Selected balance sheet information for the Partnership is as follows:
<TABLE>
<CAPTION>

                                                                March 31                               December 31
                                     ---------------------------------------------------------------   -------------
                                        2003         2002         2001         2000         1999           1998
                                     -----------  -----------   ----------   ----------   ----------   -------------
ASSETS
<S>                                <C>          <C>           <C>          <C>          <C>          <C>
Cash and cash equivalents          $    371,426 $    413,336  $   437,863  $   480,598  $   509,695  $      561,751
Investments in limited
  partnerships, net                   5,572,016    6,455,167    7,329,890    8,224,971    9,164,197       9,415,032
                                     -----------  -----------   ----------   ----------   ----------   -------------
                                   $  5,943,442 $  6,868,503  $ 7,767,753  $ 8,705,569  $ 9,673,892  $    9,976,783
                                     ===========  ===========   ==========   ==========   ==========   =============
LIABILITIES
Due to limited partnerships        $          - $          -  $         -  $         -  $    16,836  $       16,836
Due to general partner and
  affiliates                          1,126,324      994,710      849,164      718,279      552,257         561,391
                                     -----------  -----------   ----------   ----------   ----------   -------------

                                      1,126,324      994,710      849,164      718,279      569,093         578,227

PARTNERS' EQUITY                      4,817,118    5,873,793    6,918,589    7,987,290    9,104,799       9,398,556
                                     -----------  -----------   ----------   ----------   ----------   -------------
                                   $  5,943,442 $  6,868,503  $ 7,767,753  $ 8,705,569  $ 9,673,892  $    9,976,783
                                     ===========  ===========   ==========   ==========   ==========   =============
</TABLE>


                                       9
<PAGE>

<TABLE>
<CAPTION>

Selected results of operations, cash flows and other information for the Partnership are as follows:

                                                                                            For the              For the
                                           For the Years Ended                        Three Months Ended       Year Ended
                                                 March 31                                   March 31            December 31
                           -----------------------------------------------------    ------------------------   ------------
                              2003          2002           2001         2000          1999          1998          1998
                           -----------   -----------     ---------    ----------    ----------   -----------   ------------
                                                                                                  Unaudited

<S>                      <C>           <C>             <C>         <C>           <C>           <C>           <C>
Loss from operations     $   (257,349) $   (245,989)   $ (246,997) $   (244,656) $    (64,061) $    (54,043) $    (249,631)
Equity in losses of
  limited partnerships       (799,326)     (798,807)     (821,704)     (872,853)     (229,696)     (244,537)      (918,787)
                           -----------   -----------     ---------    ----------    ----------   -----------   ------------
Net loss                 $ (1,056,675) $ (1,044,796)   $(1,068,701)$  (1,117,509)$   (293,757) $   (298,580) $  (1,168,418)
                           ===========   ===========     =========    ==========    ==========   ===========   ============
Net loss allocated to:
  General partner        $    (10,567) $    (10,448)   $  (10,687) $    (11,175) $     (2,938) $     (2,986) $     (11,684)
                           ===========   ===========     =========    ==========    ==========   ===========   ============

  Limited partners       $ (1,046,108) $ (1,034,348)   $(1,058,014)$  (1,106,334)$   (290,819) $   (295,594) $  (1,156,734)
                           ===========   ===========     =========    ==========    ==========   ===========   ============
Net loss per limited
  partner unit           $     (58.12) $     (57.46)   $   (58.78) $     (61.46) $     (16.16) $     (16.42) $      (64.26)
                           ===========   ===========     =========    ==========    ===========  ===========   ============
Outstanding weighted           18,000        18,000        18,000        18,000        18,000        18,000         18,000
  limited partner units    ===========   ===========     =========    ==========    ==========   ===========   ============
</TABLE>
<TABLE>
<CAPTION>

                                                                                            For the              For the
                                           For the Years Ended                        Three Months Ended       Year Ended
                                                 March 31                                   March 31            December 31
                           -----------------------------------------------------    ------------------------   ------------
                              2003          2002          2001          2000          1999          1998          1998
                           -----------   -----------    ---------     ----------    ----------   -----------   ------------
                                                                                                 Unaudited
<S>                      <C>           <C>           <C>            <C>          <C>           <C>           <C>

Net cash provided by
  (used in):
  Operating activities   $    (66,356) $    (41,575) $   (55,648)   $   (18,170) $    (58,079) $      9,678  $       4,243
  Investing activities         24,446        17,048       12,913        (10,927)        6,023         3,200          6,437
  Financing activities              -             -            -              -             -      (900,000)      (900,000)
                           -----------   -----------    ---------     ----------    ----------   -----------   ------------
Net decrease in cash
  and cash equivalents        (41,910)      (24,527)     (42,735)       (29,097)      (52,056)     (887,122)      (889,320)

Cash and cash
  equivalents,
  beginning of period         413,336       437,863      480,598        509,695       561,751     1,451,071      1,451,071
                           -----------   -----------    ---------     ----------    ----------   -----------   ------------
Cash and cash
  equivalents, end of
  period                 $    371,426  $    413,336   $  437,863    $   480,598   $   509,695  $    563,949  $     561,751
                           ===========   ===========    =========     ==========    ==========   ===========   ============
</TABLE>
<TABLE>
<CAPTION>

Low Income Housing Credit per Unit was as follows for the years ended December 31:

                                     2002            2001             2000             1999             1998
                                 -------------   --------------   -------------    -------------    -------------
<S>                            <C>             <C>              <C>              <C>              <C>
Federal                        $          113  $           113  $          113   $          113   $          113
State                                       -                -               -                -               17
                                 -------------   --------------   -------------    -------------    -------------
Total                          $          113  $           113  $          113   $          113   $          130
                                 =============   ==============   =============    =============    =============
</TABLE>


                                       10
<PAGE>


Item 7. Management's  Discussion and Analysis of Financial Condition and Results
of Operations

Forward Looking Statements

With  the  exception  of  the  discussion  regarding   historical   information,
"Management's  Discussion  and  Analysis of Financial  Condition  and Results of
Operations"  and other  discussions  elsewhere in this Form 10-K contain forward
looking statements. Such statements are based on current expectations subject to
uncertainties  and other  factors which may involve known and unknown risks that
could  cause  actual  results  of  operations  to differ  materially  from those
projected or implied. Further, certain forward-looking statements are based upon
assumptions about future events which may not prove to be accurate.

Risks and uncertainties  inherent in forward looking statements include, but are
not  limited  to,  our  future  cash  flows and  ability  to  obtain  sufficient
financing, level of operating expenses, conditions in the low income housing tax
credit property market and the economy in general, as well as legal proceedings.
Historical  results are not necessarily  indicative of the operating results for
any future period.

Subsequent  written and oral forward  looking  statements  attributable to us or
persons  acting on our behalf  are  expressly  qualified  in their  entirety  by
cautionary  statements  in this Form 10-K and in other reports we filed with the
Securities and Exchange  Commission.  The following discussion should be read in
conjunction  with  the  Financial  Statements  and the  Notes  thereto  included
elsewhere in this filing.

Critical Accounting Policies and Certain Risks and Uncertainties

The  Partnership  believes  that the  following  discussion  addresses  its most
significant  accounting  policies,  which are the most  critical to aid in fully
understanding and evaluating the Partnership's  reported financial results,  and
certain of the Partnership's risks and uncertainties.

Use of Estimates

The preparation of financial statements in conformity with accounting principles
generally  accepted in the United States of America requires  management to make
estimates  and  assumptions  that  affect  the  reported  amounts  of assets and
liabilities  and disclosure of contingent  assets and liabilities at the date of
the  financial  statements,  and the  reported  amounts of revenues and expenses
during the reporting  period.  Actual results could materially differ from those
estimates.

Method of Accounting For Investments in Limited Partnerships

The Partnership  accounts for its investments in limited  partnerships using the
equity method of  accounting,  whereby the  Partnership  adjusts its  investment
balance for its share of the Local Limited  Partnerships'  results of operations
and for  any  contributions  made or  distributions  received.  The  Partnership
reviews the  carrying  amount of an  individual  investment  in a Local  Limited
Partnership for possible  impairment whenever events or changes in circumstances
indicate that the carrying  amount of such  investment  may not be  recoverable.
Recoverability  of such  investment  is measured by a comparison of the carrying
amount to future  undiscounted  net cash flows  expected to be generated.  If an
investment  is  considered  to be impaired,  the  impairment to be recognized is
measured by the amount by which the carrying  amount of the  investment  exceeds
fair value.  The  accounting  policies  of the Local  Limited  Partnerships  are
generally  consistent  with  those of the  Partnership.  Costs  incurred  by the
Partnership  in  acquiring  the  investments  are  capitalized  as  part  of the
investment account and are being amortized over 30 years.

Equity in losses of the Local Limited  Partnerships for each year ended March 31
have been recorded by the Partnership  based on nine months of reported  results
provided by the Local Limited  Partnerships  for each year ended December 31 and
on three months of results  estimated by management of the  Partnership for each
three-month  period ended March 31.  Management's  estimate for the  three-month
period is based on either actual unaudited results reported by the Local Limited
Partnerships  or  historical  trends  in the  operations  of the  Local  Limited
Partnerships.  Equity in losses of the Local Limited Partnerships are recognized
in the financial statements until the related investment account is reduced to a
zero balance.  Losses  incurred after the investment  account is reduced to zero
are not  recognized.  If the Local  Limited  Partnerships  report  net income in
future years,  the Partnership will resume applying the equity method only after
its share of such net  income  equals  the share of net  losses  not  recognized
during the period(s) the equity method was suspended.


                                       11
<PAGE>

Distributions  received from the Local Limited Partnerships are accounted for as
a  reduction  of  the  investment  balance.  Distributions  received  after  the
investment has reached zero are recognized as income.

Income Taxes

No provision for income taxes has been  recorded in the financial  statements as
any  liability  for  income  taxes  is the  obligation  of the  partners  of the
Partnership.

Certain Risks and Uncertainties

An investment in the  Partnership  and the  Partnership's  investments  in Local
Limited  Partnerships  and their Housing  Complexes are subject to risks.  These
risks may impact the tax benefits of an investment in the  Partnership,  and the
amount of proceeds  available for distribution to the Limited Partners,  if any,
on liquidation of the Partnership's investments. Some of those risks include the
following:

The Low Income  Housing  Credit rules are extremely  complicated.  Noncompliance
with these rules results in the loss of future Low Income  Housing  Credit s and
the fractional  recapture of Low Income Housing  Credits  already taken. In most
cases the annual amount of Low Income Housing Credits that an individual can use
is limited to the tax  liability  due on the  person's  last  $25,000 of taxable
income.  The  Local  Limited  Partnerships  may be  unable  to sell the  Housing
Complexes at a profit. Accordingly,  the Partnership may be unable to distribute
any cash to its investors.  Low Income  Housing  Credits may be the only benefit
from an investment in the Partnership.

The Partnership has invested in a limited number of Local Limited  Partnerships.
Such  limited  diversity  means that the  results of  operation  of each  single
Housing  Complex  will have a greater  impact on the  Partnership.  With limited
diversity,   poor   performance   of  one  Housing   Complex  could  impair  the
Partnership's ability to satisfy its investment objectives. Each Housing Complex
is subject to mortgage  indebtedness.  If a Local Limited  Partnership failed to
pay its  mortgage,  it  could  lose  its  Housing  Complex  in  foreclosure.  If
foreclosure  were to occur during the first 15 years,  the loss of any remaining
future Low Income Housing  Credits,  a fractional  recapture of prior Low Income
Housing  Credits,  and a loss of the  Partnership's  investment  in the  Housing
Complex would occur. The Partnership is a limited partner or non-managing member
of each Local Limited Partnership.  Accordingly,  the Partnership will have very
limited rights with respect to management of the Local Limited Partnerships. The
Partnership  will  rely  totally  on the Local  General  Partners.  Neither  the
Partnership's  investments in Local Limited Partnerships,  nor the Local Limited
Partnerships'  investments in Housing Complexes, are readily marketable.  To the
extent  the  Housing  Complexes  receive   government   financing  or  operating
subsidies,  they  may be  subject  to  one  or  more  of  the  following  risks:
difficulties  in obtaining  tenants for the Housing  Complexes;  difficulties in
obtaining  rent  increases;  limitations on cash  distributions;  limitations on
sales or refinancing of Housing Complexes; limitations on transfers of interests
in Local Limited Partnerships; limitations on removal of Local General Partners;
limitations on subsidy programs; and possible changes in applicable regulations.
Uninsured  casualties  could result in loss of property  and Low Income  Housing
Credits and recapture of Low Income Housing Credits  previously taken. The value
of real  estate  is  subject  to risks  from  fluctuating  economic  conditions,
including employment rates, inflation,  tax, environmental,  land use and zoning
policies, supply and demand of similar properties,  and neighborhood conditions,
among others.

The  ability of Limited  Partners to claim tax losses  from the  Partnership  is
limited.  The IRS may audit the  Partnership or a Local Limited  Partnership and
challenge  the tax  treatment  of tax items.  The  amount of Low Income  Housing
Credits and tax losses  allocable to the  investors  could be reduced if the IRS
were successful in such a challenge.  The  alternative  minimum tax could reduce
tax benefits from an investment  in the  Partnership.  Changes in tax laws could
also impact the tax benefits from an investment  in the  Partnership  and/or the
value of the Housing Complexes.

No trading market for the Units exists or is expected to develop.  Investors may
be unable to sell their Units  except at a discount  and should  consider  their
Units to be a long-term  investment.  Individual investors will have no recourse
if they  disagree  with actions  authorized by a vote of the majority of Limited
Partners.

To date, certain Local Limited Partnerships have incurred significant  operating
losses and have working capital  deficiencies.  In the event these Local Limited
Partnerships continue to incur significant operating losses, additional

                                       12
<PAGE>

capital contributions by the Partnership and/or the Local General Partner may be
required  to sustain  the  operations  of such Local  Limited  Partnerships.  If
additional  capital  contributions  are not made  when  they are  required,  the
Partnership's  investment in certain of such Local Limited Partnerships could be
impaired, and the loss and recapture of the related tax credits could occur.

Financial Condition

The  Partnership's  assets at March 31, 2003  consisted  of $371,000 in cash and
aggregate  investments in the eighteen Local Limited Partnerships of $5,572,000.
Liabilities  at March 31, 2003  primarily  consisted  of  $1,126,000  of accrued
annual management fees and advances due to the General Partner.

Results of Operations

Year  Ended  March  31,  2003  Compared  to  Year  Ended  March  31,  2002.  The
Partnership's  net loss for the year  ended  March  31,  2003 was  $(1,057,000),
reflecting an increase of $12,000 from the net loss of $(1,045,000)  experienced
for the  year  ended  March  31,  2002.  The  increase  in net loss is due to an
increase in loss from  operations  from  $(246,000) for the year ended March 31,
2002 to $(257,000)  for the year ended March 31, 2003. The increase in loss from
operations is due to a decrease in total income of $12,000, from $23,000 for the
year ended March 31, 2002 to $11,000 for the year ended March 31, 2003.

Year  Ended  March  31,  2002  Compared  to  Year  Ended  March  31,  2001.  The
Partnership's  net loss for the year  ended  March  31,  2002 was  $(1,045,000),
reflecting a decrease of $24,000 from the net loss of  $(1,069,000)  experienced
for the year ended March 31, 2001.  The decrease in net loss is primarily due to
equity in losses of limited partnerships which declined by $23,000 to $(799,000)
for the year ended March 31, 2002 from  $(822,000)  for the year ended March 31,
2001.  This decrease was a result of the  Partnership  not  recognizing  certain
losses of the Local Limited Partnerships.  The investments in such Local Limited
Partnerships had reached $0 at March 31, 2002. Since the Partnership's liability
with respect to its  investments is limited,  losses in excess of investment are
not recognized.

Liquidity and Capital Resources

Year Ended March 31, 2003  Compared to Year Ended March 31, 2002.  Net cash used
during the year ended March 31, 2003 was  $(42,000),  reflecting a net change of
$17,000  compared  to net  cash  used  for the  year  ended  March  31,  2002 of
$(25,000).  The change was due  primarily to an increase of $25,000 in cash used
in operating  activities.  The increase in cash used in operating activities was
offset by an increase in  distributions  by $7,000 compared with the amount paid
in the prior year.

Year Ended March 31, 2002  Compared to Year Ended March 31, 2001.  Net cash used
during the year ended  March 31, 2002 was  $(25,000),  compared to net cash used
for the year ended March 31, 2001 of $(43,000).  The change was due primarily to
a decrease in the amount of cash paid to the General Partner for management fees
compared with the amount paid in the prior year.

During the years ended March 31, 2003, 2002 and 2001,  accrued  payables,  which
consist  primarily of related party  management fees due to the General Partner,
increased by $132,000, $146,000 and $131,000,  respectively. The General Partner
does not anticipate that these accrued fees will be paid in full until such time
as  capital  reserves  are in  excess  of  future  foreseeable  working  capital
requirements of the Partnership.

The Partnership  expects its future cash flows,  together with its net available
assets at March 31, 2003, to be  sufficient  to meet all  currently  foreseeable
future cash  requirements.  This  excludes  amounts  owed to  Associates  by the
Partnership disclosed below.


                                       13
<PAGE>

<TABLE>
<CAPTION>

Future Contractual Cash Obligations

The following table summarizes our future contractual cash obligations as of March 31, 2003:

                                   2004       2005        2006        2007        2008      Thereafter     Total

                                 ---------  ----------  ----------  ----------  ----------  -----------   ---------
<S>                            <C>        <C>         <C>         <C>         <C>         <C>           <C>
Asset Management Fees (1)      $ 1,305,819$   181,385 $   181,385 $   181,385 $   181,385 $  7,618,170  $ 9,649,529
Capital Contributions
   Payable to Lower Tier
   Partnerships                         -           -           -           -           -            -           -
                                 ---------  ----------  ----------  ----------  ----------  -----------   ---------
Total contractual cash
obligations                    $ 1,305,819$   181,385 $   181,385 $   181,385 $   181,385 $  7,618,170  $ 9,649,529
                                 =========  ==========  ==========  ==========  ==========  ===========   =========
</TABLE>

(1)  Asset  Management  Fees  are  payable  annually  until  termination  of the
     Partnership, which is to occur no later than 2050. The estimate of the fees
     payable included herein assumes the retention of the Partnership's interest
     in all Housing Complexes until 2050. Amounts due to the General Partners as
     of March 31,  2003 have  been  included  in the 2004  column.  The  General
     Partner does not anticipate that these fees will be paid until such time as
     capital  reserves are in excess of the future  foreseeable  working capital
     requirements of the Partnership.

For   additional   information  on  our  Asset   Management   Fees  and  Capital
Contributions  Payable  to Lower  Tier  Partnerships,  see  Notes 2 and 3 to the
financial statements included elsewhere herein.

Exit Strategy

The IRS  compliance  period for  low-income  housing  tax credit  properties  is
generally  15 years from  occupancy  following  construction  or  rehabilitation
completion.  WNC was one of the first in the industry to offer investments using
the tax credit.  Now these very first programs are completing  their  compliance
period.

With that in mind, we are continuing our review of the  Partnership's  holdings,
with special  emphasis on the more mature  properties  including those that have
satisfied the IRS compliance requirements. Our review will consider many factors
including  extended  use  requirements  on the  property  (such as those  due to
mortgage  restrictions  or state  compliance  agreements),  the condition of the
property,  and  the tax  consequences  to the  investors  from  the  sale of the
property.

Upon identifying  those  properties with the highest  potential for a successful
sale, refinancing or syndication, we expect to proceed with efforts to liquidate
those  properties.  Our objective is to maximize the investors'  return wherever
possible and,  ultimately,  to wind down those funds that no longer  provide tax
benefits  to  investors.  To date no  properties  in the  Partnership  have been
selected.

Impact of New Accounting Pronouncements

In June 2001, the Financial Accounting Standards Board ("FASB") issued Statement
of  Financial  Accounting  Standards  ("SFAS")  No. 143,  "Accounting  for Asset
Retirement  Obligations",  which requires that the fair value of a liability for
an asset  retirement  obligation  be  recognized  in the  period  in which it is
incurred with the associated asset retirement costs being  capitalized as a part
of the  carrying  amount of the  long-lived  asset.  SFAS No. 143 also  includes
disclosure   requirements   that  provide  a  description  of  asset  retirement
obligations   and   reconciliation   of  changes  in  the  components  of  those
obligations.  The statement is effective for fiscal years  beginning  after June
15, 2002. The Partnershp  does not expect the adoption of SFAS No. 143 to have a
material effect on the Partnerhip's financial position or results of operations.

In August  2001,  the FASB  issued  SFAS No.  144,  "Impairment  or  Disposal of
Long-Lived  Assets," which addresses  accounting and financial reporting for the
impairment or disposal of long-lived assets. This standard was effective for the
Partnership's financial statements beginning January 1, 2002. The implementation
of SFAS No. 144 did not have a material  impact on the  Partnership's  financial
position or results of operations.


                                       14
<PAGE>

In April 2002, the FASB issued SFAS No. 145,  "Rescission of FASB Statements No.
4, 44, and 64,  Amendment of FASB Statement No. 13, and Technical  Corrections."
SFAS No. 145 rescinded three previously  issued  statements and amended SFAS No.
13, "Accounting for Leases." The statement provides reporting standards for debt
extinguishments   and   provides   accounting   standards   for  certain   lease
modifications that have economic effects similar to sale-leaseback transactions.
The statement is effective for certain lease  transactions  occurring  after May
15,  2002 and all other  provisions  of the  statement  shall be  effective  for
financial statements issued on or after May 15, 2002. The implementation of SFAS
No. 145 did not have a material impact on the Partnership's  financial  position
or results of operations.

In June 2002,  the FASB issued SFAS No. 146,  "Accounting  for Costs  Associated
with Exit or  Disposal  Activities,"  which  updates  accounting  and  reporting
standards for personnel and operational restructurings.  The Partnership adopted
SFAS No. 146 for exit,  disposal  or other  restructuring  activities  initiated
after  December 31,  2002.  The adoption of SFAS No. 146 did not have a material
effect on the Partnership's financial position or results of operations.

In November 2002, the FASB issued Interpretation No. 45 ("FIN 45"), "Guarantor's
Accounting  and  Disclosure  Requirements  for  Guarantees,  Including  Indirect
Guarantees  of  Indebtedness  of Others."  The adoption of FIN 45 did not have a
material impact on the Partnership's finacial position or results of operations.

In December  2002,  the FASB issued SFAS No. 148,  "Accounting  for  Stock-Based
Compensation  - Transition  and Disclosure - an Amendment to SFAS No. 123." SFAS
No. 148 provides alternative methods of transition for a voluntary change to the
fair value based method on accounting for stock-based employee compensation. The
implementation  of SFAS No. 148 is not expected to have a material effect on the
Partnership's financial position or results of operations.

In  January   2003,   the  FASB  issued   Interpretation   No.  46  ("FIN  46"),
"Consolidation  of Variable  Interest  Entities." The adoption of FIN 46 did not
have a material  impact on the  Partnership's  financial  position or results of
operations.

Item 7A.  Quantitative and Qualitative Disclosures About Market Risk

NOT APPLICABLE

Item 8.  Financial Statements and Supplementary Data



                                       15
<PAGE>



               Report of Independent Certified Public Accountants



To the Partners
WNC California Housing Tax Credits III, L.P.


We have audited the  accompanying  balance sheets of WNC California  Housing Tax
Credits III, L.P. (a California Limited  Partnership) (the  "Partnership") as of
March 31, 2003 and 2002,  and the related  statements of  operations,  partners'
equity  (deficit)  and cash flows for the years ended March 31,  2003,  2002 and
2001. 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.  A  significant  portion  of  the  financial
statements of the limited  partnerships  in which the  Partnership  is a limited
partner was audited by other  auditors  whose reports have been furnished to us.
As discussed in Note 2 to the financial statements, the Partnership accounts for
its investments in limited  partnerships using the equity method. The portion of
the Partnership's  investments in limited partnerships audited by other auditors
represented 77% and 76% of the total assets of the Partnership at March 31, 2003
and 2002,  respectively,  and 77%,  90% and 93% of the  Partnership's  equity in
losses of limited  partnerships  for the years  ended March 31,  2003,  2002 and
2001,  respectively.  Our opinion, insofar as it relates to the amounts included
in the financial  statements for the limited  partnerships which were audited by
others, is based solely on the reports of the other auditors.

We conducted our audits in accordance with auditing standards generally accepted
in the  United  States of  America.  Those  standards  require  that we plan and
perform the audits 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 and the reports of
other auditors provide a reasonable basis for our opinion.

In our  opinion,  based on our audits and the  reports  of other  auditors,  the
financial statements referred to above present fairly, in all material respects,
the  financial  position of WNC  California  Housing Tax  Credits  III,  L.P. (a
California  Limited  Partnership) as of March 31, 2003 and 2002, and the results
of its  operations  and its cash flows for the years ended March 31, 2003,  2002
and 2001, in conformity with  accounting  principles  generally  accepted in the
United States of America.




                                                  /s/  BDO SEIDMAN, LLP

Costa Mesa, California
May 27, 2003

                                       16
<PAGE>


                  WNC CALIFORNIA HOUSING TAX CREDITS III, L.P.
                       (A California Limited Partnership)

                                 BALANCE SHEETS
<TABLE>
<CAPTION>






                                                                                  March 31
                                                                        ------------------------------

                                                                            2003             2002
                                                                        -------------    -------------
 ASSETS

<S>                                                                   <C>              <C>
 Cash and cash equivalents                                            $      371,426   $      413,336
 Investments in limited partnerships, net
   (Notes 2 and 3)                                                         5,572,016        6,455,167
                                                                        -------------    -------------

                                                                      $    5,943,442   $    6,868,503
                                                                        =============    =============

 LIABILITIES AND PARTNERS' EQUITY (DEFICIT)

 Liabilities:
    Accrued fees and expenses due to General Partner
       and affiliates (Note 3)                                        $    1,126,324   $      994,710
                                                                        -------------    -------------

 Commitments and contingencies

 Partners' equity (deficit):
    General partner                                                         (121,960)        (111,393)
    Limited partners (30,000 units authorized; 18,000 units
       issued and outstanding)                                             4,939,078        5,985,186
                                                                        -------------    -------------

          Total partners' equity                                           4,817,118        5,873,793
                                                                        -------------    -------------

                                                                      $    5,943,442   $    6,868,503
                                                                        =============    =============
</TABLE>

                 See accompanying notes to financial statements
                                       17
<PAGE>


                  WNC CALIFORNIA HOUSING TAX CREDITS III, L.P.
                       (A California Limited Partnership)

                            STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>





                                                                     For the Years Ended
                                                                           March 31
                                                      ---------------------------------------------------
                                                          2003              2002               2001
                                                      --------------    -------------      --------------

<S>                                                 <C>               <C>                <C>
Interest income                                     $         4,474   $       11,282     $        19,599
Other income                                                  6,325           11,444                   -
                                                      --------------    -------------      --------------

   Total income                                              10,799           22,726              19,599
                                                      --------------    -------------      --------------
Operating expenses:
   Amortization (Notes 2 and 3)                              59,379           58,868              60,464
   Asset management fees (Note 3)                           181,385          181,385             181,571
   Other                                                     27,384           28,462              24,561
                                                      --------------    -------------      --------------

    Total operating expenses                                268,148          268,715             266,596
                                                      --------------    -------------      --------------

Loss from operations                                       (257,349)        (245,989)           (246,997)

Equity in losses of limited
  partnerships (Note 2)                                    (799,326)        (798,807)           (821,704)
                                                      --------------    -------------      --------------

Net loss                                            $    (1,056,675) $    (1,044,796)    $    (1,068,701)
                                                      ==============    =============      ==============

Net loss allocated to:
   General partner                                  $       (10,567) $       (10,448)    $       (10,687)
                                                      ==============    =============      ==============

   Limited partners                                 $    (1,046,108) $    (1,034,348)    $    (1,058,014)
                                                      ==============    =============      ==============

Net loss per limited partner unit                   $        (58.12) $        (57.46)    $        (58.78)
                                                      ==============    =============      ==============

Outstanding weighted limited partner units                   18,000           18,000              18,000
                                                      ==============    =============      ==============
</TABLE>

                 See accompanying notes to financial statements
                                       18
<PAGE>


                  WNC CALIFORNIA HOUSING TAX CREDITS III, L.P.
                       (A California Limited Partnership)

                    STATEMENTS OF PARTNERS' EQUITY (DEFICIT)

                For The Years Ended March 31, 2003, 2002 and 2001
<TABLE>
<CAPTION>



                                                               General            Limited
                                                               Partner            Partners             Total
                                                            ---------------    ---------------     ---------------
<S>                                                       <C>               <C>                  <C>
Partners' equity (deficit) at March 31, 2000              $        (90,258) $       8,077,548    $      7,987,290

Net loss                                                           (10,687)        (1,058,014)         (1,068,701)
                                                            ---------------    ---------------     ---------------

Partners' equity (deficit) at March 31, 2001                      (100,945)         7,019,534           6,918,589

Net loss                                                           (10,448)        (1,034,348)         (1,044,796)
                                                            ---------------    ---------------     ---------------
Partners' equity (deficit) at March 31, 2002                      (111,393)         5,985,186           5,873,793

Net loss                                                           (10,567)        (1,046,108)         (1,056,675)
                                                            ---------------    ---------------     ---------------
Partners' equity (deficit) at March 31, 2003              $       (121,960) $       4,939,078    $      4,817,118
                                                            ===============    ===============     ===============
</TABLE>

                 See accompanying notes to financial statements
                                       19
<PAGE>


                  WNC CALIFORNIA HOUSING TAX CREDITS III, L.P.
                       (A California Limited Partnership)

                            STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>

                                                                                  For the Years Ended
                                                                                        March 31
                                                                     -----------------------------------------------
                                                                        2003            2002              2001
                                                                     ------------   --------------    --------------
Cash flows from operating activities:
<S>                                                                <C>            <C>              <C>
   Net loss                                                        $  (1,056,675) $    (1,044,796) $     (1,068,701)
   Adjustments to reconcile net loss to
     net cash used in operating activities:
     Amortization                                                         59,379           58,868            60,464
     Equity in losses of limited
       partnerships                                                      799,326          798,807           821,704
     Change in accrued fees and
       expenses due to General
       Partner and affiliates                                            131,614          145,546           130,885
                                                                     ------------   --------------    --------------

Net cash used in
  operating activities                                                   (66,356)         (41,575)          (55,648)
                                                                     ------------   --------------    --------------

Cash flows from investing activities:
   Distributions from limited
     partnerships                                                         24,446           17,048            12,913
                                                                     ------------   --------------    --------------

Net decrease in cash and cash
  equivalents                                                            (41,910)         (24,527)          (42,735)

Cash and cash equivalents,
   beginning of year                                                     413,336          437,863           480,598
                                                                     ------------   --------------    --------------

Cash and cash equivalents,
   end of year                                                     $     371,426  $       413,336   $       437,863
                                                                     ============   ==============    ==============
SUPPLEMENTAL DISCLOSURE
  OF CASH FLOW INFORMATION:

   Taxes paid                                                      $         800  $           800   $           800
                                                                     ============   ==============    ==============
</TABLE>
                 See accompanying notes to financial statements
                                       20
<PAGE>


                  WNC CALIFORNIA HOUSING TAX CREDITS III, L.P.
                       (A California Limited Partnership)

                          NOTES TO FINANCIAL STATEMENTS

                For The Years Ended March 31, 2003, 2002 and 2001




NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
---------------------------------------------------

Organization
------------

WNC California  Housing Tax Credits III, L.P. a California  Limited  Partnership
(the  "Partnership"),  was formed on October 5, 1992 under the laws of the state
of California and began  operations on July 19, 1993. The Partnership was formed
to  invest  primarily  in  other  limited   partnerships   (the  "Local  Limited
Partnerships")  which  own  and  operate  multi-family  housing  complexes  (the
"Housing Complexes") that are eligible for low income housing credits. The local
general   partners  (the  "Local  General   Partners")  of  each  Local  Limited
Partnership retain  responsibility  for maintaining,  operating and managing the
Housing Complex.

The  general  partner  is WNC  Tax  Credit  Partners  III,  L.P.  (the  "General
Partner").  WNC &  Associates,  Inc.  ("WNC") is the general  partner of WNC Tax
Credit  Partners III, L.P. The chairman and president own  substantially  all of
the  outstanding  stock of WNC.  The  business of the  Partnership  is conducted
primarily through WNC, as the Partnership has no employees of its own.

The Partnership  shall continue in full force and effect until December 31, 2050
unless  terminated  prior to that date pursuant to the partnership  agreement or
law.

The financial  statements  include only activity relating to the business of the
Partnership,  and do not give  effect to any assets that the  partners  may have
outside of their interests in the Partnership, or to any obligations,  including
income taxes, of the partners.

The  Partnership  Agreement  authorized the sale of up to 30,000 units at $1,000
per Unit  ("Units").  The offering of Units concluded in July 1994 at which time
17,990 Units, representing subscriptions in the amount of $17,990,000,  had been
accepted. During 1995, an additional 10 units amounting to $10,000 was collected
on  subscriptions  accepted and  previously  deemed  uncollectible.  The General
Partner has a 1% interest in operating  profits and losses,  taxable  income and
losses,  cash available for distribution from the Partnership and tax credits of
the  Partnership.  The limited  partners  will be allocated the remaining 99% of
these items in proportion to their respective investments.

After the limited  partners  have received  proceeds from a sale or  refinancing
equal to their capital  contributions and their return on investment (as defined
in the  Partnership  Agreement)  and the General  Partner has received  proceeds
equal  to its  capital  contribution  and a  subordinated  disposition  fee  (as
described in Note 3) from the  remainder,  any  additional  sale or  refinancing
proceeds will be distributed 90% to the limited partners (in proportion to their
respective investments) and 10% to the General Partner.


                                       21
<PAGE>


                  WNC CALIFORNIA HOUSING TAX CREDITS III, L.P.
                       (A California Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS -CONTINUED

                For The Years Ended March 31, 2003, 2002 and 2001



NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued
--------------------------------------------------------------

Risks and Uncertainties
-----------------------

An investment in the  Partnership  and the  Partnership's  investments  in Local
Limited  Partnerships  and their Housing  Complexes are subject to risks.  These
risks may impact the tax benefits of an investment in the  Partnership,  and the
amount of proceeds  available for distribution to the Limited Partners,  if any,
on liquidation of the Partnership's investments. Some of those risks include the
following:

The Low Income  Housing  Credit rules are extremely  complicated.  Noncompliance
with these rules results in the loss of future Low Income  Housing  Credit s and
the fractional  recapture of Low Income Housing  Credits  already taken. In most
cases the annual amount of Low Income Housing Credits that an individual can use
is limited to the tax  liability  due on the  person's  last  $25,000 of taxable
income.  The  Local  Limited  Partnerships  may be  unable  to sell the  Housing
Complexes at a profit. Accordingly,  the Partnership may be unable to distribute
any cash to its investors.  Low Income  Housing  Credits may be the only benefit
from an investment in the Partnership.

The Partnership has invested in a limited number of Local Limited  Partnerships.
Such  limited  diversity  means that the  results of  operation  of each  single
Housing  Complex  will have a greater  impact on the  Partnership.  With limited
diversity,   poor   performance   of  one  Housing   Complex  could  impair  the
Partnership's ability to satisfy its investment objectives. Each Housing Complex
is subject to mortgage  indebtedness.  If a Local Limited  Partnership failed to
pay its  mortgage,  it  could  lose  its  Housing  Complex  in  foreclosure.  If
foreclosure  were to occur during the first 15 years,  the loss of any remaining
future Low Income Housing  Credits,  a fractional  recapture of prior Low Income
Housing  Credits,  and a loss of the  Partnership's  investment  in the  Housing
Complex would occur. The Partnership is a limited partner or non-managing member
of each Local Limited Partnership.  Accordingly,  the Partnership will have very
limited rights with respect to management of the Local Limited Partnerships. The
Partnership  will  rely  totally  on the Local  General  Partners.  Neither  the
Partnership's  investments in Local Limited Partnerships,  nor the Local Limited
Partnerships'  investments in Housing Complexes, are readily marketable.  To the
extent  the  Housing  Complexes  receive   government   financing  or  operating
subsidies,  they  may be  subject  to  one  or  more  of  the  following  risks:
difficulties  in obtaining  tenants for the Housing  Complexes;  difficulties in
obtaining  rent  increases;  limitations on cash  distributions;  limitations on
sales or refinancing of Housing Complexes; limitations on transfers of interests
in Local Limited Partnerships; limitations on removal of Local General Partners;
limitations on subsidy programs; and possible changes in applicable regulations.
Uninsured  casualties  could result in loss of property  and Low Income  Housing
Credits and recapture of Low Income Housing Credits  previously taken. The value
of real  estate  is  subject  to risks  from  fluctuating  economic  conditions,
including employment rates, inflation,  tax, environmental,  land use and zoning
policies, supply and demand of similar properties,  and neighborhood conditions,
among others.

The  ability of Limited  Partners to claim tax losses  from the  Partnership  is
limited.  The IRS may audit the  Partnership or a Local Limited  Partnership and
challenge  the tax  treatment  of tax items.  The  amount of Low Income  Housing
Credits and tax losses  allocable to the  investors  could be reduced if the IRS
were successful in such a challenge.  The  alternative  minimum tax could reduce
tax benefits from an investment  in the  Partnership.  Changes in tax laws could
also impact the tax benefits from an investment  in the  Partnership  and/or the
value of the Housing Complexes.

No trading market for the Units exists or is expected to develop.  Investors may
be unable to sell their Units  except at a discount  and should  consider  their
Units to be a long-term  investment.  Individual investors will have no recourse
if they  disagree  with actions  authorized by a vote of the majority of Limited
Partners.


                                       22
<PAGE>


                  WNC CALIFORNIA HOUSING TAX CREDITS III, L.P.
                       (A California Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS -CONTINUED

                For The Years Ended March 31, 2003, 2002 and 2001


NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued
--------------------------------------------------------------

Exit Strategy
-------------

The IRS  compliance  period for  low-income  housing  tax credit  properties  is
generally  15 years from  occupancy  following  construction  or  rehabilitation
completion.  WNC was one of the first in the industry to offer investments using
the tax credit.  Now these very first programs are completing  their  compliance
period.

With that in mind,  the  Partnership  is continuing to review the  Partnership's
holdings,  with special emphasis on the more mature  properties  including those
that have satisfied the IRS compliance  requirements.  The Partnership's  review
will consider many factors  including  extended use requirements on the property
(such as those due to mortgage restrictions or state compliance agreements), the
condition of the property,  and the tax  consequences  to the investors from the
sale of the property.

Upon identifying  those  properties with the highest  potential for a successful
sale,  refinancing  or  syndication,  the  Partnership  expects to proceed  with
efforts  to  liquidate  those  properties.  The  Partnership's  objective  is to
maximize the investors' return wherever possible and,  ultimately,  to wind down
those  funds  that no longer  provide  tax  benefits  to  investors.  To date no
properties in the Partnership have been selected.

Method of Accounting For Investments in Limited Partnerships
------------------------------------------------------------

The Partnership  accounts for its investments in limited  partnerships using the
equity method of  accounting,  whereby the  Partnership  adjusts its  investment
balance for its share of the Local Limited  Partnerships'  results of operations
and for any  contributions  made and  distributions  received.  The  Partnership
reviews the  carrying  amount of an  individual  investment  in a Local  Limited
Partnership for possible  impairment whenever events or changes in circumstances
indicate that the carrying  amount of such  investment  may not be  recoverable.
Recoverability  of such  investment  is measured by a comparison of the carrying
amount to future  undiscounted  net cash flows  expected to be generated.  If an
investment  is  considered  to be impaired,  the  impairment to be recognized is
measured by the amount by which the carrying  amount of the  investment  exceeds
fair value.  The  accounting  policies  of the Local  Limited  Partnerships  are
generally  consistent  with  those of the  Partnership.  Costs  incurred  by the
Partnership  in  acquiring  the  investments  are  capitalized  as  part  of the
investment account and are being amortized over 30 years (see Note 2).

Equity in losses of Local  Limited  Partnerships  for the years  ended March 31,
2003, 2002 and 2001 have been recorded by the  Partnership  based on nine months
of reported  results  provided by the Local  Limited  Partnerships  and on three
months of results  estimated  by  management  of the  Partnership.  Management's
estimate for the three-month  period is based on either actual unaudited results
reported  by  the  Local  Limited  Partnerships  or  historical  trends  in  the
operations of the Local Limited Partnerships.  Equity in losses of Local Limited
Partnerships  allocated to the Partnership  will not be recognized to the extent
that  the  investment  balance  would be  adjusted  below  zero.  As soon as the
investment  balance  reaches zero, the related costs of acquiring the investment
are accelerated to the extent of losses available (see Note 2).

Offering Expenses
-----------------

Offering  expenses consist of underwriting  commissions,  legal fees,  printing,
filing and  recordation  fees,  and other costs  incurred  with selling  limited
partnership  interests in the  Partnership.  The General Partner is obligated to
pay all  offering  and  organization  costs in  excess of 15%  (including  sales
commissions) of the total offering proceeds.  Offering expenses are reflected as
a reduction of partners'  capital and amounted to  $2,366,564  at the end of all
periods presented.


                                       23
<PAGE>

                  WNC CALIFORNIA HOUSING TAX CREDITS III, L.P.
                       (A California Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS -CONTINUED

                For The Years Ended March 31, 2003, 2002 and 2001


 NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued
 -------------------------------------------------------------

Use of Estimates
----------------

The preparation of financial statements in conformity with accounting principles
generally  accepted in the United States of America requires  management to make
estimates  and  assumptions  that  affect  the  reported  amounts  of assets and
liabilities  and disclosure of contingent  assets and liabilities at the date of
the  financial  statements,  and the  reported  amounts of revenues and expenses
during the reporting  period.  Actual results could materially differ from those
estimates.

Cash and Cash Equivalents
-------------------------

The Partnership considers highly liquid investments with remaining maturities of
three months or less when purchased to be cash equivalents.  The Partnership had
no cash equivalents at the end of all periods presented.

Concentration of Credit Risk
----------------------------

At March 31,  2003,  the  Partnership  maintained  a cash  balance  at a certain
financial institution in excess of the maximum federally insured amounts.

Net Loss Per Limited Partner Unit
---------------------------------

Net loss per  limited  partner  unit is  calculated  pursuant  to  Statement  of
Financial  Accounting  Standards No. 128,  Earnings Per Share. Net loss per unit
includes no dilution  and is computed  by  dividing  loss  available  to limited
partners by the weighted average number of units outstanding  during the period.
Calculation of diluted net loss per unit is not required.

Reporting Comprehensive Income
------------------------------

The  Statement of Financial  Accounting  Standards  ("SFAS") No. 130,  Reporting
Comprehensive  Income  established  standards  for the  reporting and display of
comprehensive  income (loss) and its components in a full set of general-purpose
financial statements. The Partnership had no items of other comprehensive income
during the years presented, as defined by SFAS No. 130.

New Accounting Pronouncements
-----------------------------

In June 2001, the Financial Accounting Standards Board ("FASB") issued Statement
of  Financial  Accounting  Standards  ("SFAS")  No. 143,  "Accounting  for Asset
Retirement  Obligations",  which requires that the fair value of a liability for
an asset  retirement  obligation  be  recognized  in the  period  in which it is
incurred with the associated asset retirement costs being  capitalized as a part
of the  carrying  amount of the  long-lived  asset.  SFAS No. 143 also  includes
disclosure   requirements   that  provide  a  description  of  asset  retirement
obligations   and   reconciliation   of  changes  in  the  components  of  those
obligations.  The statement is effective for fiscal years  beginning  after June
15, 2002. The Partnershp  does not expect the adoption of SFAS No. 143 to have a
material effect on the Partnerhip's financial position or results of operations.

In August  2001,  the FASB  issued  SFAS No.  144,  "Impairment  or  Disposal of
Long-Lived  Assets," which addresses  accounting and financial reporting for the
impairment or disposal of long-lived assets. This standard was effective for the
Partnership's financial statements beginning January 1, 2002. The implementation
of SFAS No. 144 did not have a material  impact on the  Partnership's  financial
position or results of operations.

                                       24
<PAGE>

                  WNC CALIFORNIA HOUSING TAX CREDITS III, L.P.
                       (A California Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS -CONTINUED

                For The Years Ended March 31, 2003, 2002 and 2001


NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued
-------------------------------------------------------------

In April 2002, the FASB issued SFAS No. 145,  "Rescission of FASB Statements No.
4, 44, and 64,  Amendment of FASB Statement No. 13, and Technical  Corrections."
SFAS No. 145 rescinded three previously  issued  statements and amended SFAS No.
13, "Accounting for Leases." The statement provides reporting standards for debt
extinguishments   and   provides   accounting   standards   for  certain   lease
modifications that have economic effects similar to sale-leaseback transactions.
The statement is effective for certain lease  transactions  occurring  after May
15,  2002 and all other  provisions  of the  statement  shall be  effective  for
financial statements issued on or after May 15, 2002. The implementation of SFAS
No. 145 did not have a material impact on the Partnership's  financial  position
or results of operations.

In June 2002,  the FASB issued SFAS No. 146,  "Accounting  for Costs  Associated
with Exit or  Disposal  Activities,"  which  updates  accounting  and  reporting
standards for personnel and operational restructurings.  The Partnership adopted
SFAS No. 146 for exit,  disposal  or other  restructuring  activities  initiated
after  December 31,  2002.  The adoption of SFAS No. 146 did not have a material
effect on the Partnership's financial position or results of operations.

In November 2002, the FASB issued Interpretation No. 45 ("FIN 45"), "Guarantor's
Accounting  and  Disclosure  Requirements  for  Guarantees,  Including  Indirect
Guarantees  of  Indebtedness  of Others."  The adoption of FIN 45 did not have a
material impact on the Partnership's finacial position or results of operations.

In December  2002,  the FASB issued SFAS No. 148,  "Accounting  for  Stock-Based
Compensation  - Transition  and Disclosure - an Amendment to SFAS No. 123." SFAS
No. 148 provides alternative methods of transition for a voluntary change to the
fair value based method on accounting for stock-based employee compensation. The
implementation  of SFAS No. 148 is not expected to have a material effect on the
Partnership's financial position or results of operations.

In  January   2003,   the  FASB  issued   Interpretation   No.  46  ("FIN  46"),
"Consolidation  of Variable  Interest  Entities." The adoption of FIN 46 did not
have a material  impact on the  Partnership's  financial  position or results of
operations.


                                       25
<PAGE>


                  WNC CALIFORNIA HOUSING TAX CREDITS III, L.P.
                       (A California Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS -CONTINUED

                For The Years Ended March 31, 2003, 2002 and 2001


NOTE 2 - INVESTMENTS IN LIMITED PARTNERSHIPS
--------------------------------------------

As of the periods  presented,  the Partnership had acquired limited  partnership
interests in eighteen Local Limited Partnerships, each of which owns one Housing
Complex  consisting of an aggregate of 635 apartment units. The respective Local
General  Partners  of the  Local  Limited  Partnerships  manage  the  day-to-day
operations  of the entities.  Significant  Local  Limited  Partnership  business
decisions require the approval of the Partnership. The Partnership, as a limited
partner,  is  generally  entitled  to 99%,  as  specified  in the Local  Limited
Partnership agreements,  of the operating profits and losses, taxable income and
losses and tax credits of the Local Limited Partnerships.

The  Partnership's  investments  in Local Limited  Partnerships  as shown in the
balance  sheets  at March 31,  2003 and 2002 are  approximately  $1,138,000  and
$1,291,000, respectively, greater than the Partnership's equity at the preceding
December  31 as shown in the  Local  Limited  Partnerships'  combined  financial
statements  presented  below.  This  difference  is primarily  due to unrecorded
losses,  as discussed below,  acquisition,  selection and other costs related to
the  acquisition  of  the  investments   which  have  been  capitalized  in  the
Partnership's  investment  account and to capital  contributions  payable to the
limited  partnerships  which were netted  against  partner  capital in the Local
Limited Partnerships financial statements.  The Partnership's investment is also
lower than the Partnership's equity as shown in the Local Limited  Partnerships'
combined  financial  statements  due to the  estimated  losses  recorded  by the
Partnership for the three month period ended March 31.

Equity  in  losses  of the  Local  Limited  Partnerships  is  recognized  in the
financial  statements until the related  investment account is reduced to a zero
balance. Losses incurred after the investment account is reduced to zero are not
recognized. If the Local Limited Partnerships report net income in future years,
the  Partnership  will resume applying the equity method only after its share of
such net  income  equals  the share of net  losses  not  recognized  during  the
period(s) the equity method was suspended.

Distributions  from the Local Limited  Partners are accounted for as a reduction
of the  investment  balance.  Distributions  received  after the  investment has
reached zero are recognized as income.

At March 31, 2003 and 2002,  the  investment  accounts in certain  Local Limited
Partnerships  have  reached  a zero  balance.  Consequently,  a  portion  of the
Partnership's  estimate  of its share of losses  for the years  ended  March 31,
2003, 2002 and 2001 amounting to  approximately  $173,000,  $46,000 and $24,000,
respectively,  have not been  recognized.  As of March 31, 2003,  the  aggregate
share of net losses not recognized by the Partnership amounted to $347,000.

Following is a summary of the equity method activity of the investments in Local
Limited Partnerships for periods presented:
<TABLE>
<CAPTION>

                                                                                 For the Years
                                                                                Ended March 31
                                                              ----------------------------------------------------
                                                                   2003               2002              2001
                                                              ---------------    ---------------    --------------
<S>                                                         <C>                <C>                <C>
Investments per balance sheet, beginning of period          $      6,455,167   $      7,329,890   $     8,224,971
Distributions received from limited partnerships                     (24,446)           (17,048)          (12,913)
Equity in losses of limited partnerships                            (799,326)          (798,807)         (821,704)
Amortization of paid acquisition fees and costs                      (59,379)           (58,868)          (60,464)
                                                              ---------------    ---------------    --------------
Investments per balance sheet, end of period                $      5,572,016   $      6,455,167   $     7,329,890
                                                              ===============    ===============    ==============
</TABLE>


                                       26
<PAGE>

                  WNC CALIFORNIA HOUSING TAX CREDITS III, L.P.
                       (A California Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS -CONTINUED

                For The Years Ended March 31, 2003, 2002 and 2001



NOTE 2 - INVESTMENTS IN LIMITED PARTNERSHIPS, continued
-------------------------------------------------------

The financial  information from the individual financial statements of the Local
Limited Partnerships include rental and interest subsidies. Rental subsidies are
included in total revenues and interest  subsidies are generally  netted against
interest expense.  Approximate combined condensed financial information from the
individual financial statements of the Local Limited Partnerships as of December
31 and for the years then ended is as follows:

                                        COMBINED CONDENSED BALANCE SHEETS
<TABLE>
<CAPTION>

                                                                                    2002                2001
                                                                               ---------------     ---------------
  ASSETS

<S>                                                                          <C>                 <C>
  Buildings and improvements, net of accumulated depreciation as of
   December 31, 2002 and 2001 of $9,862,000 and $8,764,000, respectively.    $     26,288,000    $     27,296,000
  Land                                                                              2,380,000           2,380,000
  Other assets                                                                      2,307,000           2,371,000
                                                                               ---------------     ---------------

                                                                             $     30,975,000    $     32,047,000
                                                                               ===============     ===============

LIABILITIES

Mortgage loans payable                                                       $     23,193,000    $     24,024,000
Due to related parties                                                              1,260,000             735,000
Other liabilities                                                                   1,436,000           1,222,000
                                                                               ---------------     ---------------

                                                                                   25,889,000          25,981,000
                                                                               ---------------     ---------------

PARTNERS' EQUITY

WNC California Housing Tax Credits III, L.P.                                        4,434,000           5,164,000
Other partners                                                                        652,000             902,000
                                                                               ---------------     ---------------

                                                                                    5,086,000           6,066,000
                                                                               ---------------     ---------------

                                                                             $     30,975,000    $     32,047,000
                                                                               ===============     ===============
</TABLE>

                                       27
<PAGE>


                  WNC CALIFORNIA HOUSING TAX CREDITS III, L.P.
                       (A California Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS -CONTINUED

                For The Years Ended March 31, 2003, 2002 and 2001


NOTE 2 - INVESTMENTS IN LIMITED PARTNERSHIPS, continued
-------------------------------------------------------

                   COMBINED CONDENSED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>

                                                                 2002               2001                2000
                                                            ---------------    ---------------     ---------------
<S>                                                       <C>                <C>                 <C>
Revenues                                                  $      3,307,000   $      3,140,000    $      3,040,000
                                                            ---------------    ---------------     ---------------

Expenses:
   Operating expenses                                            2,218,000          2,026,000           1,944,000
   Interest expense                                                941,000            857,000             814,000
   Depreciation and amortization                                 1,110,000          1,133,000           1,153,000
                                                            ---------------    ---------------     ---------------

         Total expenses                                          4,269,000          4,016,000           3,911,000
                                                            ---------------    ---------------     ---------------

Net loss                                                  $       (962,000) $        (876,000)   $       (871,000)
                                                            ===============    ===============     ===============

Net loss allocable to the Partnership                     $       (952,000) $        (845,000)   $       (862,000)
                                                            ===============    ===============     ===============

Net loss recorded by the Partnership                      $       (799,000) $        (799,000)   $       (822,000)
                                                            ===============    ===============     ===============
</TABLE>

Certain Local Limited  Partnerships have incurred  significant  operating losses
and/or have  working  capital  deficiencies.  In the event  these Local  Limited
Partnerships continue to incur significant operating losses,  additional capital
contributions  by the  Partnership  and/or  the  Local  General  Partner  may be
required  to sustain  the  operations  of such Local  Limited  Partnerships.  If
additional  capital  contributions  are not made  when  they are  required,  the
Partnership's  investment in certain of such Local Limited Partnerships could be
impaired, and the loss and recapture of the related tax credits could occur.

NOTE 3 - RELATED PARTY TRANSACTIONS
-----------------------------------

Under the terms of the  Partnership  Agreement,  the Partnership is obligated to
the General Partner or its affiliates for the following items:

          Acquisition  fees of up to 9% of the gross  proceeds  from the sale of
          Units as  compensation  for services  rendered in connection  with the
          acquisition of Local Limited  Partnerships.  At the end of all periods
          presented,  the Partnership  incurred  acquisition fees of $1,620,000.
          Accumulated  amortization of these  capitalized costs was $740,914 and
          $538,090  as  of  March  31,  2003  and  2002,  respectively.  Of  the
          accumulated  amortization  recorded on the balance  sheet at March 31,
          2003,  $149,373,  $72,995  and  $33,875  of the  related  expense  was
          reflected as equity in losses of limited partnerships during the years
          ended  March 31,  2003,  2002 and 2001,  respectively,  to reduce  the
          respective  net  acquisition  fee  component of  investments  in local
          limited  partnerships  to zero for those  Local  Limited  Partnerships
          which would otherwise be below a zero balance.

          Reimbursement of costs incurred by the General Partner or an affiliate
          in connection  with the  acquisition  of Local  Limited  Partnerships.
          These reimbursements have not exceeded 1.5% of the gross proceeds.  As
          of  the  end  of  all  periods  presented,  the  Partnership  incurred
          acquisition costs of $194,019, which have been included in investments
          in limited  partnerships.  Accumulated  amortization  was  $76,713 and
          $52,887  as  of  March  31,  2003  and  2002,  respectively.   Of  the
          accumulated  amortization  recorded on the balance  sheet at March 31,
          2003, $17,898,  $3,985 and $8,994 of the related expense was reflected
          as equity in losses of limited  partnerships  during  the years  ended
          March 31, 2003, 2002 and 2001, respectively,  to reduce the respective
          net  acquisition  cost  component  of  investments  in  local  limited
          partnerships to zero for those Local Limited  Partnerships which would
          otherwise be below a zero balance.

                                       28
<PAGE>


                  WNC CALIFORNIA HOUSING TAX CREDITS III, L.P.
                       (A California Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS -CONTINUED

                For The Years Ended March 31, 2003, 2002 and 2001



NOTE 3 - RELATED PARTY TRANSACTIONS, continued
----------------------------------------------

          An annual  management fee equal to 0.5% of the invested  assets of the
          Local  Limited  Partnerships,  including the  Partnership's  allocable
          share of the  mortgages  for the life of the  Partnership.  Management
          fees of $181,385, $181,385 and $181,571 were incurred during the years
          ended March 31, 2003, 2002 and 2001, respectively,  of which, $50,000,
          $37,500 and $50,000  were paid during the years ended March 31,  2003,
          2002 and 2001, respectively.

          A subordinated  disposition  fee in an amount equal to 1% of the sales
          price of real estate sold.  Payment of this fee is subordinated to the
          limited partners  receiving a preferred return of 16% through December
          31, 2003 and 6% thereafter (as defined in the  Partnership  Agreement)
          and is payable only if the General  Partner or its  affiliates  render
          services in the sales effort.

The accrued fees and expenses due to General Partner and affiliates consisted of
the following at:
<TABLE>
<CAPTION>

                                                                            March 31
                                                                 --------------------------------
                                                                     2003              2002
                                                                 --------------    --------------
<S>                                                            <C>               <C>
Reimbursement for expenses paid by the General
   Partner or its affiliate                                    $         1,890   $         1,661

Accrued asset management fees                                        1,124,434           993,049
                                                                 --------------    --------------

                                                               $     1,126,324   $       994,710
                                                                 ==============    ==============
</TABLE>

The General  Partner does not anticipate that these accrued fees will be paid in
full until such time as capital reserves are in excess of the future foreseeable
working capital requirements of the Partnership.

NOTE 4 - QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)
----------------------------------------------------
<TABLE>
<CAPTION>

The following is a summary of the quarterly operations for the years ended March 31, 2003 and 2002:

                                           June 30           September 30       December 31           March 31
                                        ---------------     ---------------    ---------------     ---------------

               2003
               ----
<S>                                   <C>                 <C>                <C>                <C>

Income                                $          2,000    $          3,000   $          1,000    $          5,000

Operating expenses                             (69,000)            (72,000)           (64,000)            (64,000)

Equity in losses of limited
     partnerships                             (127,000)           (126,000)          (125,000)           (421,000)

Net loss                                      (194,000)           (195,000)          (188,000)           (480,000)

Loss available to limited partners            (192,000)           (192,000)          (186,000)           (476,000)

Loss per limited partner unit                      (11)                (11)               (10)                (26)
</TABLE>

                                       29
<PAGE>


                  WNC CALIFORNIA HOUSING TAX CREDITS III, L.P.
                       (A California Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS -CONTINUED

                For The Years Ended March 31, 2003, 2002 and 2001
<TABLE>
<CAPTION>



NOTE 4 - QUARTERLY RESULTS OF OPERATIONS (UNAUDITED), continued

                                           June 30           September 30       December 31           March 31
                                        ---------------     ---------------    ---------------     ---------------

               2002
               ----

<S>                                   <C>                 <C>                <C>                 <C>
Income                                $          4,000    $          3,000   $          3,000    $         13,000

Operating expenses                             (61,000)            (77,000)           (64,000)            (67,000)

Equity in losses of limited
     partnerships                             (188,000)           (222,000)          (187,000)           (202,000)

Net loss                                      (245,000)           (296,000)          (248,000)           (256,000)

Loss available to limited partners            (242,000)           (293,000)          (246,000)           (253,000)

Loss per limited partner unit                      (13)                (16)               (14)                (14)
</TABLE>

NOTE 5 - INCOME TAXES
---------------------

No provision for income taxes has been  recorded in the financial  statements as
any  liability  for  income  taxes  is the  obligation  of the  partners  of the
Partnership.


                                       30
<PAGE>




Item  9.  Changes  in and  Disagreements  With  Accountants  on  Accounting  and
Financial Disclosure

NOT APPLICABLE

PART III.

Item 10. Directors and Executive Officers of the Registrant

(a)  Identification of Directors,  (b) Identification of Executive Officers, (c)
     Identification of Certain Significant Employees,  (d) Family Relationships,
     and (e) Business Experience

The  Partnership has no directors,  executive  officers or employees of its own.
The following biographical information is presented for the directors, executive
officers  and   significant   employees  of  Associates,   which  has  principal
responsibility for the Partnership's affairs.

Associates is a California corporation which was organized in 1971. Its officers
and significant employees are:
<TABLE>
<CAPTION>
<S>                                   <C>
Wilfred N. Cooper, Sr.                Chairman of the Board
Wilfred N. Cooper, Jr.                President and Chief Executive Officer
David N. Shafer, Esq.                 Executive Vice President and Director of Asset Management
Sylvester P. Garban                   Senior Vice President - Institutional Investments
David C. Turek                        Senior Vice President - Originations
Thomas J. Riha, CPA                   Vice President - Chief Financial Officer
Michael J. Gaber                      Vice President - Acquisitions
Diemmy T. Tran                        Vice President - Portfolio Management
J. Brad Hurlbut                       Director of Syndications
</TABLE>

In addition to Wilfred N. Cooper,  Sr., the directors of Associates  are Wilfred
N. Cooper, Jr., David N. Shafer, and Kay L. Cooper. The principal shareholder of
Associates is a trust established by Wilfred N. Cooper, Sr.

Wilfred N.  Cooper,  Sr.,  age 72, is the founder  and  Chairman of the Board of
Directors of Associates,  a Director of WNC Capital  Corporation,  and a general
partner in some of the  partnerships  previously  sponsored  by  Associates  Mr.
Cooper has been actively involved in the affordable housing industry since 1968.
Previously,  during 1970 and 1971,  he was  founder and a principal  of Creative
Equity  Development  Corporation,  a predecessor of Associates,  and of Creative
Equity Corporation, a real estate investment firm. For 12 years before that, Mr.
Cooper was employed by Rockwell International  Corporation,  last serving as its
manager  of  housing  and urban  developments  where he had  responsibility  for
factory-built  housing  evaluation and project  management in urban planning and
development.  He has testified before committees of the U.S. Senate and the U.S.
House  of  Representatives.  Mr.  Cooper  is a Life  Director  of  the  National
Association of Home Builders and a National  Trustee for NAHB's Political Action
Committee,  and the Chairman of NAHB's Multifamily  Council. He is a Director of
the National Housing Conference and a member of NHC's Executive Committee, and a
founder and Director of the California Housing Consortium.  He is the husband of
Kay Cooper and the father of Wilfred N. Cooper,  Jr. Mr. Cooper  graduated  from
Pomona College in 1956 with a Bachelor of Arts degree.

Wilfred N. Cooper, Jr., age 40, is President, Chief Executive Officer, Secretary
and a Director and a member of the  Acquisition  Committee of  Associates  He is
President of, and a registered principal with, WNC Capital Corporation, and is a
Director of WNC Management,  Inc. He has been involved in real estate investment
and acquisition activities since 1988 when he joined Associates  Previously,  he
served as a Government Affairs Assistant with Honda North America in Washington,
D.C.  Mr.  Cooper is a member of the  Editorial  Advisory  Boards of  Affordable
Housing Finance and LIHC Monthly Report, a Steering Member of the Housing Credit
Group of the National  Association  of Home Builders,  an Alternate  Director of
NAHB,  a member of the  Advisory  Board of the New York  State  Association  for
Affordable  Housing and a member of the Urban Land  Institute.  He is the son of
Wilfred  Cooper,  Sr. and Kay Cooper.  Mr.  Cooper  graduated  from The American
University in 1985 with a Bachelor of Arts degree.


                                       31
<PAGE>

David N. Shafer,  age 50, is Executive Vice President,  a Director,  Director of
Asset Management and a member of the Acquisition Committee of Associates,  and a
Director and Secretary of WNC Management, Inc. Mr. Shafer has been active in the
real estate  industry  since 1984.  Before  joining  Associates  in 1990, he was
engaged as an attorney in the private  practice of law with a specialty  in real
estate and taxation.  Mr.  Shafer is a Director and President of the  California
Council of Affordable Housing, and a member of the State Bar of California.  Mr.
Shafer graduated from the University of California at Santa Barbara in 1978 with
a Bachelor of Arts  degree,  from the New  England  School of Law in 1983 with a
Juris Doctor degree cum laude and from the  University of San Diego in 1986 with
a Master of Law degree in Taxation.

Sylvester  P.  Garban,   age  57,  is  Senior  Vice  President  -  Institutional
Investments of Associates Mr. Garban has been involved in real estate investment
activities since 1978. Before joining Associates in 1989, he served as Executive
Vice President with MRW, Inc., a real estate  development  and management  firm.
Mr. Garban is a member of the National Association of Affordable Housing Lenders
and the  Financial  Planning  Association.  He  graduated  from  Michigan  State
University in 1967 with a Bachelor of Science degree in Business Administration.

David C. Turek,  age 48, is Senior Vice President -  Originations  of Associates
His  experience  with real estate  investments  and finance has continued  since
1976, and he has been employed by Associates since 1996.  Previously,  from 1995
to 1996,  Mr.  Turek served as a  consultant  for a national tax credit  sponsor
where he was  responsible  for on-site  feasibility  studies  and due  diligence
analyses of tax credit properties. From 1992 to 1995 he served as Executive Vice
President for Levcor, Inc., a multi-family development company, and from 1990 to
1992 he served as Vice President for the Paragon Group where he was  responsible
for tax credit development activities.  He is a Director of the National Housing
and Rehabilitation  Association,  the Rural Rental Housing Association of Texas,
and the Alabama Council of Affordable  Rental Housing.  Mr. Turek graduated from
Southern Methodist University in 1976 with a Bachelor of Business Administration
degree.

Thomas J. Riha, age 47, is Vice President - Chief Financial Officer and a member
of the  Acquisition  Committee of  Associates  and  President,  Treasurer  and a
Director of WNC Management, Inc. He has been involved in real estate acquisition
and investment  activities  since 1979.  Before joining  Associates in 1994, Mr.
Riha was  employed  by Trust  Realty  Advisor,  a real  estate  acquisition  and
management  company,  last  serving  as Vice  President  -  Operations.  He is a
Director  of the Task  Force on Housing  Credit  Certification  of the  National
Association  of Home Builders.  Mr. Riha  graduated  from the  California  State
University,  Fullerton  in 1977  with a  Bachelor  of Arts  degree  cum laude in
Business  Administration  with a concentration  in Accounting and is a Certified
Public  Accountant  and a member of the American  Institute of Certified  Public
Accountants.

Michael J. Gaber,  age 37, is Vice President - Acquisitions  and a member of the
Acquisition  Committee of Associates  Mr. Gaber has been involved in real estate
acquisition,  valuation  and  investment  activities  since  1989  and has  been
associated  with  Associates  since 1997.  Prior to joining  Associates,  he was
involved in the valuation and  classification of major assets,  restructuring of
debt and analysis of real estate taxes with H.F.  Ahmanson & Company,  parent of
Home  Savings  of  America.  Mr.  Gaber  graduated  from  the  California  State
University,  Fullerton  in 1991 with a Bachelor  of Science  degree in  Business
Administration - Finance.

Diemmy T. Tran, age 37, is Vice  President - Portfolio  Management of Associates
She is responsible for overseeing  portfolio  management and investor  reporting
for  all  WNC  funds,  and  for  monitoring   investment  returns  for  all  WNC
institutional  funds. Ms. Tran has been involved in real estate asset management
and finance  activities for 12 years.  Prior to joining  Associates in 1998, Ms.
Tran served as senior asset manager for a national Tax Credit  sponsor and as an
asset specialist for the Resolution Trust  Corporation where she was responsible
for the disposition  and management of commercial  loan and REO portfolios.  Ms.
Tran is  licensed  as a  California  real  estate  broker.  She  graduated  from
California  State  University,  Northridge  in 1989 with a  Bachelor  of Science
degree in finance and a minor in real estate.

J. Brad  Hurlbut,  age 43, is  Director  of  Syndications  of  Associates  He is
responsible  for the financial  structuring of WNC's  institutional  funds.  Mr.
Hurlbut has 20 years of experience in real estate  investment  and  development.
Prior to  joining  WNC in 2000,  he served  as  corporate  controller  for Great
Western Hotels  Corporation.  Mr. Hurlbut has been an enrolled agent licensed to
practice before the IRS since 1984. He graduated from the University of Redlands
in 1981 with a  Bachelor  of  Science  degree in  business  management  and from
California State  University,  Fullerton in 1985 with a Master of Science degree
in taxation.


                                       32

<PAGE>

Kay L.  Cooper,  age 66, is a Director of  Associates  Mrs.  Cooper was the sole
proprietor of Agate 108, a manufacturer and retailer of home accessory products,
from 1975 until its sale in 1998. She is the wife of Wilfred Cooper, Sr. and the
mother of Wilfred  Cooper,  Jr. Ms.  Cooper  graduated  from the  University  of
Southern California in 1958 with a Bachelor of Science degree.


(f)  Involvement in Certain Legal Proceedings
     ----------------------------------------

     Inapplicable.

(g)  Promoters and Control Persons
     -----------------------------

     Inapplicable.

(h)  Audit Committee Financial Expert
     --------------------------------

     Neither the Partnership nor Associates has an audit committee.

Item 11.  Executive Compensation

The Partnership has no officers,  employees,  or directors.  However,  under the
terms of the  Partnership  Agreement the Partnership is obligated to the General
Partner or its  affiliates  during the current or future years for the following
fees:

(a)  Annual Asset  Management  Fee. An annual asset  management fee in an amount
     equal  to 0.5% of the  Invested  Assets  of the  Partnership,  as  defined.
     "Invested  Assets" means the sum of the  Partnership's  Investment in Local
     Limited Partnership Interests and the Partnership's  allocable share of the
     amount of the  mortgage  loans on and other  debts  related to, the Housing
     Complexes  owned by such  Local  Limited  Partnerships.  Fees of  $181,385,
     $181,385 and $181,571  were  incurred  during each of the years ended March
     31, 2003, 2002 and 2001,  respectively.  The  Partnership  paid the General
     Partner  or its  affiliates,  $50,000,  $37,500  and  $50,000 of those fees
     during the years ended March 31, 2003, 2002 and 2001, respectively.

(b)  Subordinated  Disposition Fee. A subordinated  disposition fee in an amount
     equal to 1% of the  sale  price  received  in  connection  with the sale or
     disposition  of a Housing  Complex or Local Limited  Partnership  Interest.
     Subordinated  disposition  fees will be subordinated to the prior return of
     the Limited  Partners'  capital  contributions and payment of the Return on
     Investment to the Limited Partners. "Return on Investment" means an annual,
     cumulative but not compounded,  "return" to the Limited Partners (including
     Low  Income  Housing   Credits)  as  a  class  on  their  adjusted  capital
     contributions  commencing  for each Limited  Partner on the last day of the
     calendar quarter during which the Limited Partner's capital contribution is
     received by the  Partnership,  calculated at the following  rates:  (i) 16%
     through  December 31, 2003, and (ii) 6% for the balance of the Partnerships
     term. No disposition fees have been paid.

(c)  Operating  Expense.  The Partnership  reimbursed the General Partner or its
     affiliates for operating  expenses of  approximately  $26,000,  $20,000 and
     $23,000,   during  the  years  ended  March  31,   2003,   2002  and  2001,
     respectively.

(d)  Interest  in  Partnership.   The  General   Partner   receives  1%  of  the
     Partnership's  allocated Low Income  Housing  Credits,  which  approximated
     $20,000, $20,000 and $21,000 for the General Partner for the calendar years
     ended December 31, 2002, 2001 and 2000,  respectively.  The General Partner
     is also  entitled  to  receive  1% of  cash  distributions.  There  were no
     distributions  of cash to the General  Partner during the years ended March
     31, 2003, 2002 and 2001.


                                       33
<PAGE>


Item 12.  Security  Ownership of Certain  Beneficial  Owners and  Management and
          Related Stockholder Matters

(a)  Securities Authorized for Issuance Under Equity Compensation Plans
     ------------------------------------------------------------------

     Inapplicable

(b)  Security Ownership of Certain Beneficial Owners
     -----------------------------------------------

     No person is known to the General Partner to own beneficially in excess of
     5% of the outstanding Units.

(c)  Security Ownership of Management
     --------------------------------

     Neither the General  Partner,  its  affiliates,  nor any of the officers or
     directors  of  the  General  Partner  or its  affiliates  own  directly  or
     beneficially any Units in the Partnership.

(d)  Changes in Control
     ------------------

     The management and control of the General  Partner and of Associates may be
     changed  at any time in  accordance  with their  respective  organizational
     documents,  without the consent or  approval  of the Limited  Partners.  In
     addition,  the Partnership  Agreement  provides for the admission of one or
     more additional and successor General Partners in certain circumstances.

     First,   with  the   consent   of  any  other   General   Partners   and  a
     majority-in-interest  of the  Limited  Partners,  any  General  Partner may
     designate  one or  more  persons  to be  successor  or  additional  General
     Partners. In addition,  any General Partner may, without the consent of any
     other General Partner or the Limited Partners,  (i) substitute in its stead
     as General  Partner  any  entity  which has,  by merger,  consolidation  or
     otherwise,  acquired  substantially  all  of its  assets,  stock  or  other
     evidence of equity interest and continued its business, or (ii) cause to be
     admitted to the Partnership an additional General Partner or Partners if it
     deems such  admission to be necessary or desirable so that the  Partnership
     will be classified a partnership for Federal income tax purposes.  Finally,
     a  majority-in-interest  of the Limited Partners may at any time remove the
     General Partner of the Partnership and elect a successor General Partner.

Item 13.  Certain Relationships and Related Transactions

The General Partner manages all of the Partnership's  affairs.  The transactions
with  the  General  Partner  are  primarily  in the  form  of  fees  paid by the
Partnership for services rendered to the Partnership,  reimbursement of expenses
and the General Partner's  interest in the Partnership,  as discussed in Item 11
and in the notes to the Partnership's financial statements.

Item 14. Controls and Procedures

Associates,  on behalf of the  Partnership,  maintains  disclosure  controls and
procedures that are designed to ensure that information required to be disclosed
in our  periodic  reports  filed with the  Securities  and  Exchange  Commission
("SEC") is recorded, processed,  summarized and reported within the time periods
specified  in the  rules  and  forms of the SEC and  that  such  information  is
accumulated  and  communicated  to our management as appropriate to allow timely
decisions  regarding  required  disclosure.  In  designing  and  evaluating  the
disclosure controls and procedures,  our management recognized that any controls
and  procedures,  no matter how well  designed  and  operated,  can provide only
reasonable  assurance of achieving the desired control objectives and management
necessarily  was required to apply its judgment in evaluating  the  cost-benefit
relationship of possible controls and procedures.

Based on their most recent evaluation, which was completed within 90 days of the
filing of this Annual Report on Form 10-K, our Principal  Executive  Officer and
Principal  Financial Officer believe that our disclosure controls and procedures
(as defined in Rules 13a-14 and 15d-14 of the  Securities  Exchange Act of 1934,
as  amended)  are  effective.  There were no  significant  changes  in  internal
controls or in other  factors that could  significantly  affect  these  internal
controls subsequent to the date of their most recent evaluation.


                                       34
<PAGE>


PART IV.

Item 15.  Exhibits, Financial Statement Schedules, and Reports on Form 8-K

(a)(1)    Financial statements included in Part II hereof:
          ------------------------------------------------

          Report of Independent  Certified Public Accountants
          Balance Sheets as of March 31,  2003 and 2002
          Statements  of  Operations  for the years ended March 31, 2003,  2002
            and 2001
          Statements  of Partners'  Equity (Deficit) for the years ended
            March 31, 2003, 2002 and 2001
          Statements of Cash Flows for the years ended March 31, 2003,  2002 and
            2001
          Notes to Financial Statements

(a)(2)    Financial statement schedules included in Part IV hereof:
          ---------------------------------------------------------

          Report  of  Independent  Certified  Public  Accountants  on  Financial
          Statement  Schedules Schedule III - Real Estate Owned by Local Limited
          Partnerships

(b)       Reports on Form 8-K.
          --------------------

          None

(c)       Exhibits.
          ---------

3.1       Agreement of Limited  Partnership  dated October 5, 1992;  included as
          Exhibit B to the  Prospectus,  which was filed as Exhibit 28.1 to Form
          10-K for the year  ended  December  31,  1994 is  hereby  incorporated
          herein as Exhibit 3.1.

10.1      Amended and  Restated  Agreement  of Limited  Partnership  of Colonial
          Village  Roseville  (1) filed as exhibit 10.1 to Form 8-K/A  Amendment
          No. 1 to Current Report dated December 27, 1993 is hereby incorporated
          herein by reference as exhibit 10.1.

10.2      Amended and Restated Agreement of Limited Partnership of Almond Garden
          Apartment Associates filed as exhibit 10.2 to Form 8-K/A Amendment No.
          1 to Current  Report dated  December  27, 1993 is hereby  incorporated
          herein by reference as exhibit 10.2.

10.3      Amended  and  Restated  Agreement  of Limited  Partnership  of Winters
          Investment  Group filed as exhibit 10.3 to Form 8-K/A  Amendment No. 1
          to Current  Report  dated  December  27,  1993 is hereby  incorporated
          herein by reference as exhibit 10.3.

10.4      Third Amended and Restate Articles of Limited Partnership of Buccaneer
          Associates,  Limited filed as exhibit 10.2 to Post-Effective Amendment
          No. 2 to Form S-11 dated  September  17,  1993 is hereby  incorporated
          herein by reference as exhibit 10.4.

10.5      Amended and Restated Agreement and Certificate of Limited  Partnership
          of Dallas County Housing, Ltd. filed as exhibit 10.3 to Post-Effective
          Amendment  No. 2 to Form  S-11  dated  September  17,  1993 is  hereby
          incorporated herein by reference as exhibit 10.5.

10.6      Amended and Restated Agreement of Limited Partnership of La Paloma Del
          Sol  Phase  II  Limited   Partnership   filed  as   exhibit   10.4  to
          Post-Effective  Amendment No. 2 to Form S-11 dated  September 17, 1993
          is hereby incorporated herein by reference as exhibit 10.6.

10.7      Second  Amended and Restated  Agreement of Limited  Partnership of Old
          Fort  Limited  Partnership  filed as  exhibit  10.5 to  Post-Effective
          Amendment  No. 2 to Form  S-11  dated  September  17,  1993 is  hereby
          incorporated herein by reference as exhibit 10.7.


                                       35
<PAGE>

10.8      Amended  and  Restated  Agreement  of  Limited  Partnership  of  Orosi
          Apartments, Ltd. filed as exhibit 10.6 to Post-Effective Amendment No.
          2 to Form S-11 dated September 17, 1993 is hereby  incorporated herein
          by reference as exhibit 10.8.

10.9      Amended and Restated  Agreement of Limited  Partnership  of Sun Manor,
          L.P. filed as exhibit 10.7 to  Post-Effective  Amendment No. 2 to Form
          S-11  dated  September  17,  1993 is  hereby  incorporated  herein  by
          reference as exhibit 10.9.

10.10     Amended  and  Restated  Agreement  of  Limited  Partnership  of  Venus
          Retirement  Village,  Ltd.  filed as  exhibit  10.8 to  Post-Effective
          Amendment  No. 2 to Form  S-11  dated  September  17,  1993 is  hereby
          incorporated herein by reference as exhibit 10.10.

10.11     Second  Amended  and  Restated  Agreement  of Limited  Partnership  of
          Walnut-Pixley,  L.P. filed as exhibit 10.9 to Post-Effective Amendment
          No. 2 to Form S-11 dated  September  17,  1993 is hereby  incorporated
          herein by reference as exhibit 10.11.

10.12     Amended and Restated  Agreement of Limited  Partnership of Almond View
          Apartments, Ltd. filed as exhibit 10.11 to Form 10K dated December 31,
          1993 is hereby incorporated herein by reference as exhibit 10.12.

10.13     Amended and Restated  Agreement of Limited  Partnership of Candleridge
          Apartments  of Perry,  L.P. II filed as exhibit 10.1 to Form 8-K dated
          May 26, 1994 is hereby  incorporated  herein by  reference  as exhibit
          10.13.

10.14     Second  Amended  and  Restated  Agreement  of Limited  Partnership  of
          Parlier  Garden Apts.  filed as exhibit 10.2 to Form 8-K dated May 26,
          1994 is hereby incorporated herein by reference as exhibit 10.14.

10.15     Agreement  of  Limited  Partnership  of  Rosewood  Apartments  Limited
          Partnership  filed as exhibit  10.3 to Form 8-K dated May 26,  1994 is
          hereby incorporated herein by reference as exhibit 10.15.

10.16     Agreement  of  Limited  Partnership  of Limited  Partnership  of Nueva
          Sierra Vista  Associates filed as exhibit 10.4 to Form 8-K/A Amendment
          No. 1 to  Current  Report  dated May 26,  1994 is hereby  incorporated
          herein by reference as exhibit 10.16.

10.17     Amended and Restated  Agreement of Limited  Partnership of Memory Lane
          Limited  Partnership  filed as exhibit  10.1 to Form 8-K dated July 7,
          1994 is hereby incorporated herein by reference as exhibit 10.17.

10.18     Second Amended and Restated Agreement of Limited  Partnership of Tahoe
          Pines Apartments filed as exhibit 10.1 to Form 8-K dated July 27, 1994
          is hereby incorporated herein by reference as exhibit 10.18.

99.1      Certification of the Principal Executive Officer pursuant to 18 U.S.C.
          section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley
          Act of 2002. (filed herewith)

99.2      Certification of the Principal Financial Officer pursuant to 18 U.S.C.
          section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley
          Act of 2002. (filed herewith)

99.3      Financial Statements of Colonial Village Roseville,  as of and for the
          years ended  December  31,  2001 and 2000  together  with  Independent
          Auditors'  Report  thereon;  filed as exhibit  99.3 on Form 10-K dated
          March 31, 2002; a significant subsidiary of the Partnership.

99.4      Financial  Statements of Almond View  Apartments,  Ltd., as of and for
          the years ended  December 31, 2001 and 2000 together with  Independent
          Auditors'  Report  thereon;  filed as exhibit  99.4 on Form 10-K dated
          March 31, 2002; a significant subsidiary of the Partnership.

99.5      Financial Statements of Colonial Village Roseville,  as of and for the
          years ended  December  31,  2002 and 2001  together  with  Independent
          Auditors' Report thereon; a significant subsidiary of the Partnership.
          (filed herewith)

                                       36
<PAGE>

99.6      Financial  Statements of Walnut Pixley,  as of and for the years ended
          December 31, 2002 and 2001 together with Independent  Auditors' Report
          thereon; a significant subsidiary of the Partnership. (filed herewith)

(d)       Financial  statement  schedules  follow,  as set  forth in  subsection
          ---------------------------------------
          (a)(2) hereof.


                                       37
<PAGE>


         Report of Independent Certified Public Accountants on Financial
          Statement Schedules





To the Partners
WNC California Housing Tax Credits III, L.P.


The audits  referred to in our report dated May 27, 2003,  relating to the 2003,
2002 and 2001 financial  statements of WNC  California  Housing Tax Credits III,
L.P.  (the  "Partnership"),  which are  contained  in Item 8 of this Form  10-K,
included  the audits of the  accompanying  financial  statement  schedules.  The
financial  statement  schedules  are  the  responsibility  of the  Partnership's
management.  Our  responsibility  is to express  an  opinion on these  financial
statement schedules based upon our audits.

In our opinion,  such  financial  statement  schedules  present  fairly,  in all
material respects, the financial information set forth therein.



                                              /s/  BDO SEIDMAN, LLP


Costa Mesa, California
May 27, 2003

                                       38
<PAGE>


WNC California Housing Tax Credits III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2003
<TABLE>
<CAPTION>

                                              ------------------------------------  ------------------------------------------------
                                                    As of March 31, 2003                            As of December 31, 2002
------------------------------------------------------------------------------------------------------------------------------------
                                              Total Investment     Amount of       Encumbrances                              Net
                                           in Local Limited   Investment Paid  of Local Limited  Property and  Accumulated   Book
   Partnership Name       Location              Partnerships        to Date       Partnerships    Equipment  Depreciation    Value
------------------------------------------------------------------------------------------------------------------------------------
<S>                       <C>                <C>                <C>           <C>              <C>           <C>         <C>
Almond Garden
Apartment                 Delhi,
Associates                California         $   391,000        $  391,000    $  1,376,000     $ 1,764,000   $ 570,000   $ 1,194,000


Almond View               Stockton,
Apartments, Ltd.          California           1,639,000         1,639,000       1,746,000       3,527,000   1,059,000     2,468,000

Buccaneer                 Fernandia
Associates,               Beach,
Limited                   Florida                365,000           365,000       1,462,000       2,218,000     514,000     1,704,000

Candleridge
Apartments of             Perry,
Perry L.P. II             Iowa                   126,000           126,000         691,000         908,000     269,000       639,000

Colonial
Village                   Roseville,
Roseville                 California           2,811,000         2,811,000       2,012,000       5,301,000   1,551,000     3,750,000

Dallas
County
Housing,                  Orrville,
Ltd.                      Alabama                130,000           130,000         609,000         792,000     205,000       587,000

La Paloma
del Sol
Limited                   Deming, New
Partnership               Mexico                 254,000           254,000       1,419,000       1,830,000     415,000     1,415,000

Memory Lane               Yankton,
Limited                   South
Partnership               Dakota                 151,000           151,000         676,000         874,000     402,000       472,000

Nueva Sierra
Vista                     Richgrove,
Associates                California           1,688,000         1,688,000       1,626,000       3,252,000     611,000     2,641,000

Old Fort
Highway
Limited                   Hidalgo,
Partnership               Texas                  249,000           249,000       1,265,000       1,713,000     403,000     1,310,000
</TABLE>

                                       39
<PAGE>

WNC California Housing Tax Credits III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2003
<TABLE>
<CAPTION>

                                              ------------------------------------  ------------------------------------------------
                                                    As of March 31, 2003                            As of December 31, 2002
------------------------------------------------------------------------------------------------------------------------------------
                                              Total Investment     Amount of       Encumbrances                              Net
                                           in Local Limited   Investment Paid  of Local Limited  Property and  Accumulated   Book
   Partnership Name       Location              Partnerships        to Date       Partnerships    Equipment  Depreciation    Value
------------------------------------------------------------------------------------------------------------------------------------
<S>                       <C>              <C>                <C>             <C>             <C>          <C>          <C>
Orosi Apartments,         Orosi,
Ltd.                      California             461,000           461,000       1,915,000       2,460,000     411,000     2,049,000

Parlier                   Parlier,
Garden Apts.              California             453,000           453,000       1,693,000       2,198,000     479,000     1,719,000

Rosewood
Apartments
Limited                   Superior,
Partnership               Wisconsin              185,000           185,000         470,000         767,000     176,000       591,000

Sun Manor,                Itta Bena,
L.P.                      Mississippi            230,000           230,000       1,048,000       1,345,000     410,000       935,000

Tahoe                     South Lake
Pines                     Tahoe,
Apartments                California           1,633,000         1,633,000       1,655,000       3,292,000   1,010,000     2,282,000

Venus
Retirement                Venus,
Village, Ltd.             Texas                  161,000           161,000         719,000         928,000     291,000       637,000

Walnut                    Orange,
Pixley, L.P.              California           1,078,000         1,078,000         993,000       2,768,000     632,000     2,136,000

Winters
Investment                Winters,
Group                     California             531,000           531,000       1,818,000       2,593,000     454,000     2,139,000
                                           --------------     -------------   -------------   ------------- ------------ -----------
                                           $  12,536,000      $ 12,536,000    $ 38,530,000    $ 23,193,000 $ 9,862,000  $ 28,668,000
                                           ==============     =============   =============   ============= ============ ===========
</TABLE>



                                       40
<PAGE>



WNC California Housing Tax Credits III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2003
<TABLE>
<CAPTION>
                                   ------------------------------------------------------------------------
                                                   For the year ended December 31, 2002
                                   ------------------------------------------------------------------------
         Partnership Name                                           Year                      Estimated
                                                       Net Income   Investment                 Useful Life
                                      Rental Income    (Loss)        Acquired       Status     (Years)
-----------------------------------------------------------------------------------------------------------
<S>                                      <C>         <C>                  <C>       <C>               <C>
Almond Garden
Apartment Associates                     $ 167,000   $  (41,000)           1994     Completed         27.5

Almond View Apartments, Ltd.               229,000     (238,000)           1994     Completed         27.5

Buccaneer Associates, Limited              231,000      (41,000)           1994     Completed           40

Candleridge Apartments of Perry
L.P. II                                    157,000      (12,000)           1994     Completed         27.5

Colonial Village Roseville                 463,000      (57,000)           1993     Completed         27.5

Dallas County Housing, Ltd.                 81,000       (9,000)           1993     Completed           40

La Paloma del Sol Limited
Partnership                                157,000      (32,000)           1993     Completed           40

Memory Lane Limited Partnership
                                            80,000       (3,000)           1994     Completed           25

Nueva Sierra Vista Associates              154,000     (146,000)           1994     Completed           40

Old Fort Limited Partnership               168,000      (40,000)           1993     Completed           40

Orosi Apartments, Ltd.                     198,000      (32,000)           1993     Completed           50

Parlier Garden Apts.                       228,000      (24,000)           1994     Completed           40

Rosewood Apartments Limited
Partnership                                 88,000        5,000            1994     Completed           40

Sun Manor, L.P.                            144,000      (27,000)           1993     Completed         27.5

Tahoe Pines Apartments                     187,000     (178,000)           1994     Completed         27.5

Venus Retirement Village, Ltd.              90,000      (21,000)           1993     Completed           25

Walnut - Pixley, L.P.                      161,000      (25,000)           1993     Completed           40

Winters Investment Group                   218,000      (41,000)           1994     Completed           50
                                      ------------    ----------
                                      $ 3,201,000     $(962,000)
                                      ============    ==========
</TABLE>



                                       41
<PAGE>


WNC California Housing Tax Credits III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2002
<TABLE>
<CAPTION>
                                             ------------------------------------  ------------------------------------------------
                                                    As of March 31, 2002                            As of December 31, 2001
------------------------------------------------------------------------------------------------------------------------------------
                                              Total Investment     Amount of       Encumbrances                              Net
                                           in Local Limited   Investment Paid  of Local Limited  Property and  Accumulated   Book
   Partnership Name       Location              Partnerships        to Date       Partnerships    Equipment  Depreciation    Value
------------------------------------------------------------------------------------------------------------------------------------
<S>                       <C>                <C>                <C>           <C>              <C>           <C>         <C>
Almond Garden
Apartment                 Delhi,
Associates                California         $   391,000        $  391,000    $  1,381,000     $ 1,757,000   $ 510,000   $ 1,247,000


Almond View               Stockton,
Apartments, Ltd.          California           1,639,000         1,639,000       1,754,000       3,526,000     934,000     2,592,000

Buccaneer                 Fernandia
Associates,               Beach,
Limited                   Florida                365,000           365,000       1,468,000       2,218,000     460,000     1,758,000

Candleridge
Apartments of             Perry,
Perry L.P. II             Iowa                   126,000           126,000         695,000         901,000     234,000       667,000

Colonial
Village                   Roseville,
Roseville                 California           2,811,000         2,811,000       2,044,000       5,299,000   1,366,000     3,933,000

Dallas
County
Housing,                  Orrville,
Ltd.                      Alabama                130,000           130,000         612,000         789,000     182,000       607,000

La Paloma
del Sol
Limited                   Deming, New
Partnership               Mexico                 254,000           254,000       1,424,000       1,789,000     367,000     1,422,000

Memory Lane               Yankton,
Limited                   South
Partnership               Dakota                 151,000           151,000         680,000         874,000     375,000       499,000

Nueva Sierra
Vista                     Richgrove,
Associates                California           1,688,000         1,688,000       1,629,000       3,252,000     531,000     2,721,000

Old Fort
Highway
Limited                   Hidalgo,
Partnership               Texas                  249,000           249,000       1,270,000       1,699,000     357,000     1,342,000
</TABLE>


                                       42
<PAGE>

WNC California Housing Tax Credits III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2002
<TABLE>
<CAPTION>

                                              ------------------------------------  ------------------------------------------------
                                                    As of March 31, 2002                            As of December 31, 2001
------------------------------------------------------------------------------------------------------------------------------------
                                              Total Investment     Amount of       Encumbrances                              Net
                                           in Local Limited   Investment Paid  of Local Limited  Property and  Accumulated   Book
   Partnership Name       Location              Partnerships        to Date       Partnerships    Equipment  Depreciation    Value
------------------------------------------------------------------------------------------------------------------------------------
<S>                       <C>              <C>                <C>             <C>             <C>          <C>          <C>
Orosi Apartments,         Orosi,
Ltd.                      California             461,000           461,000       1,929,000       2,450,000     363,000     2,087,000

Parlier                   Parlier,
Garden Apts.              California             453,000           453,000       1,699,000       2,195,000     427,000     1,768,000

Rosewood
Apartments
Limited                   Superior,
Partnership               Wisconsin              185,000           185,000         482,000         767,000     157,000       610,000

Sun Manor,                Itta Bena,
L.P.                      Mississippi            230,000           230,000       1,051,000       1,344,000     361,000       983,000

Tahoe                     South Lake
Pines                     Tahoe,
Apartments                California           1,633,000         1,633,000       1,668,000       3,292,000     895,000     2,397,000

Venus
Retirement                Venus,
Village, Ltd.             Texas                  161,000           161,000         721,000         928,000     262,000       666,000

Walnut                    Orange,
Pixley, L.P.              California           1,078,000         1,078,000       1,693,000       2,768,000     577,000     2,191,000

Winters
Investment                Winters,
Group                     California             531,000           531,000       1,824,000       2,592,000     406,000     2,186,000
                                           --------------     -------------   -------------   ------------- ------------ -----------
                                           $  12,536,000      $ 12,536,000    $ 24,024,000    $ 38,440,000 $ 8,764,000  $ 29,676,000
                                           ==============     =============   =============   ============= ============ ===========
</TABLE>





                                       43

<PAGE>



WNC California Housing Tax Credits III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2002
<TABLE>
<CAPTION>
                                   ------------------------------------------------------------------------
                                                   For the year ended December 31, 2001
                                   ------------------------------------------------------------------------
         Partnership Name                                           Year                      Estimated
                                                       Net Income   Investment                 Useful Life
                                      Rental Income    (Loss)        Acquired       Status     (Years)
-----------------------------------------------------------------------------------------------------------
<S>                                      <C>         <C>                  <C>       <C>               <C>
Almond Garden
Apartment Associates                     $ 162,000   $  (50,000)           1994     Completed         27.5

Almond View Apartments, Ltd.               209,000     (230,000)           1994     Completed         27.5

Buccaneer Associates, Limited              222,000      (46,000)           1994     Completed           40

Candleridge Apartments of Perry
L.P. II                                    151,000      (11,000)           1994     Completed         27.5

Colonial Village Roseville                 450,000      (49,000)           1993     Completed         27.5

Dallas County Housing, Ltd.                 68,000      (17,000)           1993     Completed           40

La Paloma del Sol Limited
Partnership                                129,000      (38,000)           1993     Completed           40

Memory Lane Limited Partnership
                                            72,000      (20,000)           1994     Completed           25

Nueva Sierra Vista Associates              142,000     (101,000)           1994     Completed           40

Old Fort Limited Partnership               151,000      (40,000)           1993     Completed           40

Orosi Apartments, Ltd.                     193,000      (16,000)           1993     Completed           50

Parlier Garden Apts.                       202,000      (21,000)           1994     Completed           40

Rosewood Apartments Limited
Partnership                                 80,000       (4,000)           1994     Completed           40

Sun Manor, L.P.                            143,000      (26,000)           1993     Completed         27.5

Tahoe Pines Apartments                     182,000     (118,000)           1994     Completed         27.5

Venus Retirement Village, Ltd.              87,000      (18,000)           1993     Completed           25

Walnut - Pixley, L.P.                      150,000      (42,000)           1993     Completed           40

Winters Investment Group                   197,000      (29,000)           1994     Completed           50
                                      ------------    ----------
                                      $ 2,990,000     $(876,000)
                                      ============    ==========
</TABLE>



                                       44
<PAGE>


WNC California Housing Tax Credits III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2001
<TABLE>
<CAPTION>
                                             ------------------------------------  ------------------------------------------------
                                                    As of March 31, 2001                            As of December 31, 2000
------------------------------------------------------------------------------------------------------------------------------------
                                              Total Investment     Amount of       Encumbrances                              Net
                                           in Local Limited   Investment Paid  of Local Limited  Property and  Accumulated   Book
   Partnership Name       Location              Partnerships        to Date       Partnerships    Equipment  Depreciation    Value
------------------------------------------------------------------------------------------------------------------------------------
<S>                       <C>                <C>                <C>           <C>              <C>           <C>         <C>
Almond Garden
Apartment                 Delhi,
Associates                California         $   391,000        $  391,000    $  1,386,000     $ 1,757,000   $ 448,000   $ 1,309,000


Almond View               Stockton,
Apartments, Ltd.          California           1,639,000         1,639,000       1,761,000       3,525,000     809,000     2,716,000

Buccaneer                 Fernandia
Associates,               Beach,
Limited                   Florida                365,000           365,000       1,473,000       2,218,000     406,000     1,812,000

Candleridge
Apartments of             Perry,
Perry L.P. II             Iowa                   126,000           126,000         698,000         892,000     200,000       692,000

Colonial
Village                   Roseville,
Roseville                 California           2,811,000         2,811,000       2,073,000       5,300,000   1,174,000     4,126,000

Dallas
County
Housing,                  Orrville,
Ltd.                      Alabama                130,000           130,000         613,000         760,000     161,000       599,000

La Paloma
del Sol
Limited                   Deming, New
Partnership               Mexico                 254,000           254,000       1,429,000       1,784,000     320,000     1,464,000

Memory Lane               Yankton,
Limited                   South
Partnership               Dakota                 151,000           151,000         682,000         875,000     341,000       534,000

Nueva Sierra
Vista                     Richgrove,
Associates                California           1,688,000         1,688,000       1,631,000       3,288,000     471,000     2,817,000

Old Fort
Highway
Limited                   Hidalgo,
Partnership               Texas                  249,000           249,000       1,275,000       1,671,000     312,000     1,359,000
</TABLE>


                                       45
<PAGE>

WNC California Housing Tax Credits III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2001
<TABLE>
<CAPTION>
                                           ------------------------------------  ------------------------------------------------
                                                    As of March 31, 2001                            As of December 31, 2000
------------------------------------------------------------------------------------------------------------------------------------
                                              Total Investment     Amount of       Encumbrances                              Net
                                           in Local Limited   Investment Paid  of Local Limited  Property and  Accumulated   Book
   Partnership Name       Location              Partnerships        to Date       Partnerships    Equipment  Depreciation    Value
------------------------------------------------------------------------------------------------------------------------------------
<S>                       <C>              <C>                <C>             <C>             <C>          <C>          <C>
Orosi Apartments,         Orosi,
Ltd.                      California             461,000           461,000       1,943,000       2,443,000     315,000     2,128,000

Parlier                   Parlier,
Garden Apts.              California             453,000           453,000       1,705,000       2,193,000     376,000     1,817,000

Rosewood
Apartments
Limited                   Superior,
Partnership               Wisconsin              185,000           185,000         495,000         767,000     138,000       629,000

Sun Manor,                Itta Bena,
L.P.                      Mississippi            230,000           230,000       1,055,000       1,341,000     313,000     1,028,000

Tahoe                     South Lake
Pines                     Tahoe,
Apartments                California           1,633,000         1,633,000       1,680,000       3,291,000     769,000     2,522,000

Venus
Retirement                Venus,
Village, Ltd.             Texas                  161,000           161,000         724,000         928,000     247,000       681,000

Walnut                    Orange,
Pixley, L.P.              California           1,078,000         1,078,000       1,710,000       2,765,000     518,000     2,247,000

Winters
Investment                Winters,
Group                     California             531,000           531,000       1,830,000       2,592,000     358,000     2,234,000
                                           --------------     -------------   -------------   ------------- ------------ -----------
                                           $  12,536,000      $ 12,536,000    $ 24,163,000    $ 38,390,000 $ 7,676,000  $ 30,714,000
                                           ==============     =============   =============   ============= ============ ===========
</TABLE>






                                       46
<PAGE>



WNC California Housing Tax Credits III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2001
<TABLE>
<CAPTION>
                                   ------------------------------------------------------------------------
                                                   For the year ended December 31, 2000
                                   ------------------------------------------------------------------------
         Partnership Name                                           Year                      Estimated
                                                       Net Income   Investment                 Useful Life
                                      Rental Income    (Loss)        Acquired       Status     (Years)
-----------------------------------------------------------------------------------------------------------
<S>                                      <C>         <C>                  <C>       <C>               <C>
Almond Garden
Apartment Associates                     $ 162,000   $  (55,000)           1994     Completed         27.5

Almond View Apartments, Ltd.               196,000     (212,000)           1994     Completed         27.5

Buccaneer Associates, Limited              206,000      (48,000)           1994     Completed           40

Candleridge Apartments of Perry
L.P. II                                    144,000      (17,000)           1994     Completed         27.5

Colonial Village Roseville                 425,000      (66,000)           1993     Completed         27.5

Dallas County Housing, Ltd.                 65,000      (18,000)           1993     Completed           40

La Paloma del Sol Limited
Partnership                                125,000      (34,000)           1993     Completed           40

Memory Lane Limited Partnership
                                            61,000      (36,000)           1994     Completed           25

Nueva Sierra Vista Associates              149,000     (108,000)           1994     Completed           40

Old Fort Limited Partnership               161,000      (24,000)           1993     Completed           40

Orosi Apartments, Ltd.                     189,000      (15,000)           1993     Completed           50

Parlier Garden Apts.                       203,000       (5,000)           1994     Completed           40

Rosewood Apartments Limited
Partnership                                 83,000        6,000            1994     Completed           40

Sun Manor, L.P.                            141,000      (24,000)           1993     Completed         27.5

Tahoe Pines Apartments                     174,000     (123,000)           1994     Completed         27.5

Venus Retirement Village, Ltd.              87,000      (23,000)           1993     Completed           25

Walnut - Pixley, L.P.                      146,000      (46,000)           1993     Completed           40

Winters Investment Group                   192,000      (23,000)           1994     Completed           50
                                      ------------    ----------
                                       $ 2,909,000     $(871,000)
                                      ============    ==========
</TABLE>



                                       47
<PAGE>



                                   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.

WNC CALIFORNIA HOUSING TAX CREDITS III, L.P.

By:      WNC & Associates, Inc.,
         General Partner

         By:      /s/ Wilfred N. Cooper, Jr.
                  --------------------------
                  Wilfred N. Cooper, Jr.,
                  President of WNC & Associates, Inc.

Date:  July 7, 2003

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.


By:      /s/ Wilfred N. Cooper, Jr.
         --------------------------
         Wilfred N. Cooper, Jr.,
         Chief Executive Officer, President and Director of WNC & Associates,
         Inc. (principal executive officer)

Date:  July 7, 2003

By:      /s/ Thomas J. Riha
         -------------------
         Thomas J. Riha,
         Vice-President - Chief Financial Officer of WNC & Associates, Inc.
        (principal financial officer and principal accounting
         officer)

Date:  July 7, 2003


By:      /s/ Wilfred N. Cooper, Sr.
         --------------------------
         Wilfred N. Cooper, Sr.,
         Chairman of the Board of WNC & Associates, Inc.

Date:  July 7, 2003
By:      /s/ David N. Shafer
         --------------------
         David N Shafer,
         Director of WNC & Associates, Inc.

Date:  July 7, 2003


                                       48
<PAGE>


                                 CERTIFICATIONS

     I,   Wilfred N. Cooper, Jr., certify that:

     1.   I have  reviewed  this  annual  report on Form 10-K of WNC  CALIFORNIA
          HOUSING TAX CREDITS III, L.P.;

     2.   Based on my knowledge,  this annual report does not contain any untrue
          statement  of a  material  fact  or  omit to  state  a  material  fact
          necessary to make the statements  made, in light of the  circumstances
          under which such  statements were made, not misleading with respect to
          the periods covered by this annual report;

     3.   Based on my knowledge,  the financial statements,  and other financial
          information  included in this  annual  report,  fairly  present in all
          material respects the financial  condition,  results of operations and
          cash flows of the registrant as of, and for, the periods  presented in
          this annual report;

     4.   The registrant's  other certifying  officers and I are responsible for
          establishing  and maintaining  disclosure  controls and procedures (as
          defined in Exchange  Act Rules  13a-14 and 15d-14) for the  registrant
          and we have:

          (a) designed such  disclosure  controls and  procedures to ensure that
          material  information  relating  to  the  registrant,   including  its
          consolidated subsidiaries,  is made known to us by others within those
          entities,  particularly  during the period in which this annual report
          is being prepared;

          (b)  evaluated  the  effectiveness  of  the  registrant's   disclosure
          controls  and  procedures  as of a date  within  90 days  prior to the
          filing date of this annual report (the "Evaluation Date"); and

          (c)  presented  in  this  annual  report  our  conclusions  about  the
          effectiveness  of the disclosure  controls and procedures based on our
          evaluation as of the Evaluation Date;

     5.   The registrant's other certifying officers and I have disclosed, based
          on our most recent  evaluation,  to the registrant's  auditors and the
          audit  committee  of  registrant's  board  of  directors  (or  persons
          performing the equivalent function):

          (a)  all  significant  deficiencies  in the  design  or  operation  of
          internal  controls  which  could  adversely  affect  the  registrant's
          ability to record,  process,  summarize and report  financial data and
          have identified for the registrant's  auditors any material weaknesses
          in internal controls; and

          (b) any fraud,  whether or not material,  that involves  management or
          other  employees  who  have a  significant  role  in the  registrant's
          internal controls; and

     6.   The  registrant's  other  certifying  officers and I have indicated in
          this annual report  whether or not there were  significant  changes in
          internal controls or in other factors that could significantly  affect
          internal   controls   subsequent  to  the  date  of  our  most  recent
          evaluation,   including   any   corrective   actions  with  regard  to
          significant deficiencies and material weaknesses.

     Date:  July 7, 2003


     /s/  Wilfred N. Cooper, Jr.
     ---------------------------

     [Signature]

     Chairman and Chief Executive Officer of WNC & Associates, Inc.


                                       49
<PAGE>


                                 CERTIFICATIONS

     I,   Thomas J. Riha, certify that:

     1.   I have  reviewed  this  annual  report on Form 10-K of WNC  CALIFORNIA
          HOUSING TAX CREDITS III, L.P.;

     2.   Based on my knowledge,  this annual report does not contain any untrue
          statement  of a  material  fact  or  omit to  state  a  material  fact
          necessary to make the statements  made, in light of the  circumstances
          under which such  statements were made, not misleading with respect to
          the periods covered by this annual report;

     3.   Based on my knowledge,  the financial statements,  and other financial
          information  included in this  annual  report,  fairly  present in all
          material respects the financial  condition,  results of operations and
          cash flows of the registrant as of, and for, the periods  presented in
          this annual report;

     4.   The registrant's  other certifying  officers and I are responsible for
          establishing  and maintaining  disclosure  controls and procedures (as
          defined in Exchange  Act Rules  13a-14 and 15d-14) for the  registrant
          and we have:

          (a) designed such  disclosure  controls and  procedures to ensure that
          material  information  relating  to  the  registrant,   including  its
          consolidated subsidiaries,  is made known to us by others within those
          entities,  particularly  during the period in which this annual report
          is being prepared;

          (b)  evaluated  the  effectiveness  of  the  registrant's   disclosure
          controls  and  procedures  as of a date  within  90 days  prior to the
          filing date of this annual report (the "Evaluation Date"); and

          (c)  presented  in  this  annual  report  our  conclusions  about  the
          effectiveness  of the disclosure  controls and procedures based on our
          evaluation as of the Evaluation Date;

     5.   The registrant's other certifying officers and I have disclosed, based
          on our most recent  evaluation,  to the registrant's  auditors and the
          audit  committee  of  registrant's  board  of  directors  (or  persons
          performing the equivalent function):

          (a)  all  significant  deficiencies  in the  design  or  operation  of
          internal  controls  which  could  adversely  affect  the  registrant's
          ability to record,  process,  summarize and report  financial data and
          have identified for the registrant's  auditors any material weaknesses
          in internal controls; and

          (b) any fraud,  whether or not material,  that involves  management or
          other  employees  who  have a  significant  role  in the  registrant's
          internal controls; and

     6.   The  registrant's  other  certifying  officers and I have indicated in
          this annual report  whether or not there were  significant  changes in
          internal controls or in other factors that could significantly  affect
          internal   controls   subsequent  to  the  date  of  our  most  recent
          evaluation,   including   any   corrective   actions  with  regard  to
          significant deficiencies and material weaknesses.

     Date:   July 7, 2003


     /s/  Thomas J. Riha
     -------------------

     [Signature]

     Vice-President - Chief Financial Officer of WNC & Associates, Inc.


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