AMENDMENT NO. 1 TO 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 December 31, 1997

                                       OR

o 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: 0-20057


                      WNC HOUSING TAX CREDIT FUND II, L.P.

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

California                                                   33-0391979

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

                                                            (714) 662-5565

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

Title of Securities                                Exchanges on which Registered

NONE                                               NOT APPLICABLE



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

NONE


<PAGE>

         Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days. Yes X No ____
         Indicate by check mark if disclosure of delinquent  filers  pursuant to
Item 405 of Regulation S-K 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

State the aggregate market value of the voting stock held by  non-affiliates  of
the registrant. 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>


Item 1.  Business

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

WNC  Housing  Tax Credit Fund II,  L.P.  ("HTCF II" or the  "Partnership")  is a
California limited  partnership formed under the laws of the State of California
on January 19, 1990.  The  Partnership  was formed to invest  primarily in other
limited  partnerships which will own and operate  multi-family housing complexes
that will  qualify  for low income  housing  credits  (the "Low  Income  Housing
Credit").


The  general  partner of the  Partnership  is WNC  Financial  Group,  L.P.  (the
"General Partner").  The general partners of WNC Financial Group, L.P. are WNC &
Associates,  Inc. ("Associates" .) and Wilfred N. Cooper, Sr. Wilfred N. Cooper,
Sr.  through  the  Cooper  Revocable  Trust,  owns  just  less  than  70% of the
outstanding  stock of  Associates  John B. Lester,  Jr. is the original  limited
partner of the Partnership and owns,  through the Lester Family Trust, just less
than 30% of the outstanding stock of Associates. The business of the Partnership
is conducted  primarily  through the General  Partner as the  Partnership has no
employees of its own.

On April 27, 1990, the  Partnership  commenced a public offering of 12,000 units
of Limited Partnership  Interests ("Units"),  at a price of $1,000 per Unit. The
General  Partner  concluded  the sale of Units on December  31, 1992. A total of
7,000 Units representing $7,000,000 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  in  local  limited
partnerships  ("Local Limited  Partnerships") each of which will own and operate
an apartment complex ("Apartment Complex") 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
against  Federal  taxes  otherwise  due in each year of a ten year  period  (the
"Credit Period".  The Apartment Complex is subject to a fifteen-year  compliance
period (the "Compliance Period").

In general,  in order to avoid  recapture  of Low Income  Housing  Credits,  the
Partnership  does not  expect  that it will  dispose  of its  interest  in Local
Limited Partnerships ("Local Limited Partnership Interests") or approve the sale
by a Local Limited  Partnership of any Apartment Complex prior to the end of the
applicable  Compliance  Period.  Because  of (i)  the  nature  of the  Apartment
Complexes,  (ii) the  difficulty of predicting  the resale market for low-income
housing  15 or  more  year  in  the  future,  and  (iii)  the  inability  of the
Partnership  to directly  cause the sale of  Apartment  Complexes by the general
partners  of  the  respective   Local  Limited   Partnerships   ("Local  General
Partners"),  but generally  only to require such Local  General  Partners to use
their  respective best efforts to find a purchaser for the Apartment  Complexes,
it is  not  possible  at  this  time  to  predict  whether  the  liquidation  of
substantially  all  of the  Partnership's  assets  and  the  disposition  of the
proceeds,  if any, in accordance with 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 an Apartment  Complex,  it is anticipated that the
Local General Partner will either continue to operate such Apartment  Complex or
take such other actions as the Local General Partner  believes to be in the best
interest of the Local Limited Partnership. In addition, circumstances beyond the
control of the General  Partner may occur  during the  Compliance  Period  which
would require the Partnership to approve the disposition of an Apartment Complex
prior to the end thereof.

                                       3


<PAGE>

As of December  31, 1997,  HTCF II had  invested in twenty  seven Local  Limited
Partnerships.  Each of these Local Limited Partnerships own an Apartment Complex
that is eligible for the Low Income  Housing  Credit.  All of the Local  Limited
Partnerships  also benefit from  government  programs  promoting low or moderate
income housing.

The Partnership's  investments in Local Limited  Partnerships are subject to the
risks  incident to the management and ownership of low income housing and to the
management and ownership of multifamily  residential real estate.  Some of these
risks are that the Low Income Housing Credit could be recaptured and neither the
Partnership's  investments  nor the Apartment  Complexes  owned by Local Limited
Partnerships will be readily marketable. Additionally, there can be no assurance
that the  Partnership  will be able to dispose of its interests in Local Limited
Partnerships at the end of the Compliance Period. The value of the Partnership's
investments   will  be  subject  to  changes  in  national  and  local  economic
conditions,  including  unemployment  conditions,  which could adversely  impact
vacancy levels,  rental payment defaults and operating expenses.  This, in turn,
could  substantially  increase  the risk of operating  losses for the  Apartment
Complexes and the Partnership.  The Apartment Complexes could be subject to loss
through foreclosure.  In addition,  each Local Limited Partnership is subject to
risks relating to environmental hazards which might be uninsurable.  Because the
Partnership's  ability to control its operations  will depend on these and other
factors  beyond the control of the General  Partner and the general  partners of
the Local  Limited  Partnerships,  there can be no  assurance  that  Partnership
operations will be profitable or that the anticipated Low Income Housing Credits
will be available to Limited Partners.

As of December 31, 1997,  all of the Apartment  Complexes  were completed and in
operation.  The Apartment  Complexes owned by the Local Limited  Partnerships in
which HTCF II has  invested  were  developed by the Local  General  Partners who
acquired the sites and applied for applicable  mortgages and subsidies.  HTCF II
became  the  principal  limited  partner  in these  Local  Limited  Partnerships
pursuant to arm's-length  negotiations with Local General Partners. As a limited
partner,  HTCF II liability for obligations of the Local Limited  Partnership is
limited  to its  investment.  The Local  General  Partner  of the Local  Limited
Partnership retains  responsibility for maintaining,  operating and managing the
Apartment Complex.

The  following  is a schedule  of the status as of  December  31,  1997,  of the
Apartment  Complexes  owned by Local Limited  Partnerships in which HTCF II is a
limited partner.

<TABLE>
<CAPTION>

                           SCHEDULE OF PROJECTS OWNED BY LOCAL LIMITED PARTNERSHIPS
                                      IN WHICH HTCF II HAS AN INVESTMENT
                                                                      December 31, 1997
                                               -----------------------------------------------------------------
                                                                                             Percentage of
                                               No.of         Units            Units             Total Units
Name & Location                                Units       Completed         Occupied            Occupied
---------------                                -----       ---------         --------            --------
<S>                                            <C>         <C>               <C>              <C>    
                                               

Airport Road Assoc.                                40               40               40                    100%
  Slidell, Louisiana
Am-Kent Associates, Ltd.                           32               32               32                    100%
  Amite & Kentwood, Louisiana
Arizona I                                          42               42               32                     76%
  Show Low, Arizona
Ashland Investment Group                           40               40               39                     98%
  Ashland, Oregon
Brantley Housing, Ltd.                             19               19               19                    100%
  Brantley, Alabama
Brian's Village Apartments, Ltd.                   28               28               28                    100%
  Mannford, Oklahoma
Candlerigde Apartments of Perry LP                 23               23               23                    100%
  Perry, Iowa
                                       4
<PAGE>

                           SCHEDULE OF PROJECTS OWNED BY LOCAL LIMITED PARTNERSHIPS
                                      IN WHICH HTCF II HAS AN INVESTMENT
                                                                      December 31, 1997
                                               -----------------------------------------------------------------
                                                                                             Percentage of
                                               No.of         Units            Units             Total Units
Name & Location                                Units       Completed         Occupied            Occupied
---------------                                -----       ---------         --------            --------
<S>                                            <C>         <C>               <C>              <C>    
Candlerigde Apts. of Runnells L.P.                 15               15               15                    100%
  Runnells, Iowa
Casa Allegre Limited Partnership                   42               42               42                    100%
  Las Vegas, New Mexico
Castroville Village, Ltd.                          40               40               40                    100%
  Castroville, Texas
Cherokee                                           31               31               31                    100%
  Rogersville, Tennessee
Divall Midland Associates Limited II               32               32               25                     78%
  Port Washington, Wisconsin
Eclectic Housing, Ltd                              15               15               15                    100%
  Electic, Alabama
Elizabeth Square                                   48               48               47                     98%
  Raceland, Louisiana
Emory Capital, L.P.                                16               16               15                     94%
  Emory, Texas
Emory Manor, L.P.                                  24               24               23                     96%
  Emory, Texas
Idalou Manor, L.P.                                 24               24               24                    100%
  Idalou, Texas
Jefferson Capital, L.P.                            30               30               28                     93%
  Jefferson, Texas
Jefferson Manor, L.P.                              32               32               29                     91%
  Jefferson, Texas
Lake View, a Wisconsin Limited                     40               40               39                     98%
  Partnership
Littlefield Manor, L.P.                            24               24               20                     83%
  Littlefield, Texas
Perry County Housing, Ltd.                         15               15               15                    100%
  Uniontown, Alabama
Pine Hill Housing, Ltd.                            19               19               18                     95%
  Pine Hill, Alabama
Rociada Partners Limited                           28               28               27                     96%
  Hereford, Texas
Wadley Housing, Ltd.                               15               15               14                     93%
  Wadley, Alabama
Whitewater Woods,                                  40               40               38                     95%
  Whitewater, Wisconsin
Willcox Investment Group                           30               30               28                     93%
  Willcox, Arizona
                                                 ----      -----------       ----------        ----------------

Totals                                           784               784              746                     95%
                                                 ====              ===              ===                     ===

</TABLE>
                                       5
<PAGE>
Item 2.  Properties

Through its investment in Local Limited  Partnerships HTCF II holds interests in
Apartment  Complexes.  See Item 1 for information  pertaining to these Apartment
Complexes.


Item 3.  Legal Proceedings

         NONE.

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

         NONE.

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 are being sold through a
public  offering.  It is not anticipated that any public market will develop for
the  purchase  and sale of any  Unit.  Units  can be  assigned  only if  certain
requirements in the Partnership Agreement are satisfied.

(b) At December 31, 1997, there were 575 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.  The Limited  Partners  received The
Limited Partners  received Low Income Housing Credits of $145, $145 and $145 for
1997,1996 and 1995, respectively, per Unit.


Item 6.  Selected Financial Data
<TABLE>
<CAPTION>

                                                        Years ended December31,
                                   ----------------------------------------------------------------------------
                     
                                     1997            1996             1995            1994            1993

                                     ----            ----             ----            ----            ----
<S>                              <C>               <C>              <C>            <C>             <C>       
Revenues                             $5,785          $10,157         $11,368          $9,287          $11,193

Partnership operating
expenses                           (179,503)        (234,161)       (186,417)       (181,780)        (176,139)

Equity in loss of
Local Limited                      (143,021)        (568,488)       (602,163)       (544,630)        (634,893)
                                   --------         --------        --------        ---------        --------
Partnership

Net loss                          $(316,739)       $(792,492)      $(777,212)     $ (717,123)       $(799,839)
                                   ========         ========         =======       =========         ========

Net loss per Limited
Partnership Interest              $     (45)       $    (112)      $    (110)      $    (101)       $    (113)
                                     =======         ========        ========        =========       =========

Total assets                      $2,010,083       $2,214,272      $2,898,812      $3,530,041       $4,189,583
                                   =========        =========       =========       =========        =========
                                       6
<PAGE>
<CAPTION>

                                                        Years ended December31,
                                  ----------------------------------------------------------------------------
                     
                                     1997            1996             1995            1994            1993

                                     ----            ----             ----            ----            ----
<S>                              <C>              <C>             <C>             <C>             <C>       
Net investment in
Local Limited Partnerships        $1,828,770       $2,005,382      $2,606,673      $3,289,100       $3,812,614
                                   =========        =========       =========       =========       ==========

Capital contributions
payable to
Local Limited Partnerships        $        0       $        0      $        0      $        0       $  132,820
                                   =========       ==========       =========      ==========       ==========
</TABLE>
                                                                               



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

Liquidity and Capital Resources
-------------------------------

Overall,  as reflected in its Statement of Cash Flows, the Partnership had a net
decrease in cash of  approximately  $27,000 for the period  ended  December  31,
1997.  This decrease in cash  consisted of cash used in investing  activities of
approximately $12,200 and used in operating activities of approximately $39,200.
Cash provided by investing  activities  consisted entirely of distributions from
Local Limited  Partnerships.  Cash provided by operating activities consisted of
interest  income.  Cash used in  operating  activities  consisted  primarily  of
payments for  operating  fees and  expenses.  The major  components of all these
activities are discussed in greater detail below.

Overall,  as reflected in its Statement of Cash Flows, the Partnership had a net
decrease in cash of  approximately  $30,200 for the period  ended  December  31,
1996.  This decrease in cash was as a result of cash from  investing  activities
consisting  entirely  of  distributions  from  Local  Limited   Partnerships  of
approximately  $11,400 offset by operating activities of approximately  $41,600.
Cash provided by operating  activities  consisted of interest income and payment
of  receivable  from  affiliates.  Cash used in operating  activities  consisted
primarily of payments for operating fees and expenses.  The major  components of
all these activities are discussed in greater detail below.

As of December 31, 1997,  the General  Partner has invested in 27 Local  Limited
Partnerships.  The Partnership  raised $7,000,000 from investors by means of its
public offering and applied the Net Proceeds thereof available for investment to
the payment of Acquisition Fees and Acquisition  Expenses,  the establishment of
Reserves,  the payment of operating  expenses and the acquisition of investments
in Local Limited Partnerships which own the Apartment Complexes.

Prior to sale of the  Apartment  Complexes,  it is not expected  that any of the
Local Limited  Partnerships in which the Partnership has invested or will invest
will generate cash sufficient to provide distributions to The Partnership of any
material amount.  Distributions  to the Partnership  would first by used to meet
operating  expenses  of the  Partnership,  including  the  payment  of the Asset
Management Fee to the General Partner.  See Item 11 hereof.  As a result,  it is
not anticipated that the Partnership  will provide  distributions to the Limited
Partners prior to the same of the Apartment Complexes.

The Partnership's  investments are not readily marketable and may be affected by
adverse general economic conditions which, in turn, could substantially increase
the risk of operating  losses for the  Apartment  Complexes,  the Local  Limited
Partnerships  and the  Partnership.  These  problems may result from a number of
factors,   many  of  which  cannot  be  controlled   by  the  General   Partner.
Nevertheless,  the General Partner anticipates that capital raised from the sale
of the Limited  Partnership  Interests is sufficient  to fund the  Partnership's
operations.
                                       7
<PAGE>

Upon  completion of its public  offering (in 1992) the  Partnership  established
working capital reserves of approximately  3.0% of the Limited Partners' capital
contributions.  This amount is anticipated  to be sufficient to satisfy  general
working  capital and  administrative  expense  requirements  of the  Partnership
including  payment of the asset management fee as well as expenses  attendant to
the  preparation  of tax returns and reports to the Limited  Partners  and other
investor servicing obligations of the Partnership.  Liquidity would, however, be
adversely affected by unanticipated or greater than anticipated operating costs.
To the extent that working capital reserves are insufficient to satisfy the cash
requirements of the  Partnership,  it is anticipated that additional funds would
be sought  through  bank loans or other  institutional  financing.  The  General
Partner may also apply any cash  distributions  received  from the local limited
partnerships  for such  purposes or to  replenish  or increase  working  capital
reserves.

Under its  partnership  agreement the  Partnership  does not have the ability to
assess its partners for additional  capital  contributions to provide capital if
needed  by the  Partnership  or  Local  Limited  Partnerships.  Accordingly,  if
circumstances arise that cause the Local Limited Partnerships to require capital
in addition to that  contributed by the  Partnership and any equity of the local
general partners, the only sources from which such capital needs will be able to
be  satisfied  (other than the limited  reserves  available  at the  Partnership
level) will be (i) third-party debt financing  (which may not be available,  if,
as expected, the apartment complexes owned by the local limited partnerships are
already  substantially  leveraged),  (ii)  additional  equity  contributions  or
advances of the local general partners,  (iii) other equity sources (which could
adversely  affect the  Partnership's  interest in tax credits,  cash flow and/or
proceeds of sale or refinancing of the apartment complexes and result in adverse
tax  consequences to the Limited  Partners),  or (iv) the sale or disposition of
the apartment  complexes (which could have the same adverse effects as discussed
in (iii) above).  There can be no assurance  that funds from any of such sources
would be readily available in sufficient amounts to fund the capital requirement
of the local limited partnerships in question.  If such funds are not available,
the  Local  Limited  Partnerships  would  risk  foreclosure  on their  apartment
complexes if they were unable to renegotiate  the terms of their first mortgages
and any other debt secured by the apartment  complexes to the extent the capital
requirements of the local limited partnerships relate to such debt.


Liquidity
---------

HTCF II's primary source of funds was the proceeds of its public offering. Other
sources of liquidity  include interest earned on cash balances and distributions
from Local Limited Partnerships.  The Local Limited Partnerships are expected to
maintain  working  capital  reserves  independent  of  those  maintained  by the
Partnership  to the extent that (i) the terms of mortgage debt  encumbering  the
Apartment  Complexes  or the  terms  of any  government  assistance  program  so
require,  or (ii) the Local General  Partner  determines  that such reserves are
necessary  or  advisable.  Although  reserves are to be  maintained  at both the
Partnership  and Local Limited  Partnership  levels,  if such reserves and other
available  income,  if any, are  insufficient to cover the  Partnership's or any
Local  Limited  Partnership's  operating  expenses  and  liabilities,  it may be
necessary to accumulate additional funds from distributions  received from Local
Limited  Partnerships which would otherwise be available for distribution to the
Limited Partners,  or to liquidate the  Partnership's  investment in one or more
Local Limited Partnerships.

Reserves of the Partnership and reserves of the Local Limited Partnership may be
increased  or  decreased  from time to time by the General  Partner or the Local
General  Partner,  as the case may be,  in order to meet  anticipated  costs and
expenses.  The amount of cash flow  available  for  distribution  and/or Sale or
Refinancing Proceeds, if any, which is available for distribution to the Limited
Partners may be affected accordingly.

Results of Operations
---------------------

The Partnership was formed to provide various  benefits to its Limited  Partners
as  discussed  in Item 1.  It is not  expected  that  any of the  Local  Limited

                                       8
<PAGE>

Partnerships  in which the  Partnership  has invested  will  generate  cash flow
sufficient  to provide for  distributions  to Limited  Partners in any  material
amount.  The  Partnership  accounts  for its  investments  in the Local  Limited
Partnerships on the equity method,  thereby adjusting its investment  balance by
its proportionate share of the income or loss of the local limited partnerships.

Consistent  with the  Partnership's  investment  objectives,  each Local Limited
Partnership is generating or is expected to generate Low Income Housing  Credits
for  a  period  of  approximately  ten  years,  commencing  with  completion  of
construction or rehabilitation of its Apartment Complex(es) and is generating or
is expected to generate losses until sale of the Apartment Complex(es).

As reflected on its  Statements of  Operations,  the  Partnership  had losses of
$316,739,  $792,492,  and $777,212, for the years ended December 31, 1997, 1996,
and 1995, respectively. The component items of revenue and expense are discussed
below.

Revenue.  Partnership  revenues  consisted  entirely of interest  earned on cash
deposits  held in  financial  institutions  (i) as  Reserves,  or  (ii)  pending
investment in Local Limited Partnerships.  Interest revenue in future years will
be a function of prevailing interest rates and the amount of cash balances.

Expenses. The most significant component of operating expenses is expected to be
the Asset Management Fee. The Asset Management Fees is equal to 0.5% of Invested
asset in local Limited  Partnerships:  accordingly  the amount to be incurred in
the future is a function of the level of such invested assets (i.e.,  the sum of
the Partnerships'  capital  contributions to the Local Limited Partnerships plus
the Partnership's share of the debts related to the Apartment Complexes owned by
such  Local  Limited  Partnerships).  The annual  management  fee  incurred  was
$144,903,  $144,903,  and $144,903 for the years ended December 31, 1997,  1996,
and 1995, respectively, of which $32,000 and $35,000 were paid in 1997 and 1996,
respectively.

Office expense consists of the Partnership's  administrative  expenses,  such as
accounting and legal fees, bank charges and investor reporting expenses.

Equity in losses from Local Limited  Partnerships.  The Partnership's  equity in
losses from Local Limited Partnerships is equal to 99% of the aggregate net loss
of the Local Limited Partnerships. After rent-up, the Local Limited Partnerships
have generated and are expected to continue  generating  losses during each year
of operations.  This is so because, although rental income is expected to exceed
cash operating expenses, depreciation and amortization deductions claimed by the
Local  Limited  Partnerships  are  expected to exceed net rental  income.  These
losses were  greater for the years ended  December 31, 1996 and 1995 as compared
to the year ended December 31, 1997 period reflecting lower interest expense and
suspended  recognition  of losses for those limited  partnerships  reaching zero
balance in their related investment account.

The Partnership, as a Limited Partner in the Local Limited Partnerships in which
it  has  invested,  is  subject  to the  risks  incident  to  the  construction,
management,  and ownership of improved real estate. The Partnership  investments
are also subject to adverse general economic  conditions,  and accordingly,  the
status  of  the  national  economy,   including  substantial   unemployment  and
concurrent  inflation,  could increase vacancy levels,  rental payment defaults,
and operating expenses,  which in turn, could substantially increase the risk of
operating losses for the Apartment Complexes.


Item 7A.  Quantitative and Qualitative and Qualitative  Disclosures About Market
Risk

         NONE.

                                       9
<PAGE>

Item 8.  Financial Statements and Supplementary Data

                      WNC HOUSING TAX CREDIT FUND II, L.P.
                       (A California Limited Partnership)

                              FINANCIAL STATEMENTS

                               For The Years Ended
                        December 31, 1997, 1996 and 1995

                                      with

                      INDEPENDENT AUDITORS' REPORT THEREON




<PAGE>









                          INDEPENDENT AUDITORS' REPORT



To the Partners
WNC Housing Tax Credit Fund II, L.P.


We have audited the  accompanying  balance sheets of WNC Housing Tax Credit Fund
II, L.P. (a California Limited  Partnership) (the  "Partnership") as of December
31, 1997 and 1996, and the related  statements of operations,  partners'  equity
(deficit) and cash flows for the years ended  December 31, 1997,  1996 and 1995.
These  financial   statements  are  the   responsibility  of  the  Partnership's
management.  Our  responsibility  is to express  an  opinion on these  financial
statements based on our audits. We did not audit the financial statements of the
limited  partnerships in which WNC Housing Tax Credit Fund II, L.P. is a limited
partner. These investments,  as discussed in Note 2 to the financial statements,
are  accounted  for by the  equity  method.  The  investments  in these  limited
partnerships  represented 91% of the total assets of WNC Housing Tax Credit Fund
II, L.P. at December 31, 1997 and 1996. The financial  statements of the limited
partnerships were audited by other auditors whose reports have been furnished to
us, and our  opinion,  insofar as it relates to the amounts  included  for these
limited partnerships, is based solely on the reports of the other auditors.

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

In our opinion,  based on our audits and the reports of the other auditors,  the
financial statements referred to above present fairly, in all material respects,
the  financial  position of WNC  Housing Tax Credit Fund II, L.P. (A  California
Limited  Partnership)  as of December 31, 1997 and 1996,  and the results of its
operations  and its cash flows for the years ended  December 31, 1997,  1996 and
1995 in conformity with generally accepted accounting principles.






                                                            /s/CORBIN & WERTZ
                                                            -----------------
                                                               CORBIN & WERTZ

Irvine, California
March 13, 1998


<PAGE>


                      WNC HOUSING TAX CREDIT FUND II, L.P.
                       (A California Limited Partnership)

                                 BALANCE SHEETS

                           December 31, 1997 and 1996


<TABLE>
<CAPTION>


                                                                               1997                    1996
                                                                          ---------------         ---------------
<S>                                                                    <C>                      <C>   
ASSETS

Cash and cash equivalents                                               $        181,313        $         208,303

Investments in limited partnerships (Note 2)                                   1,828,770                2,005,382

Other assets                                                                           -                      587
                                                                         ---------------         ----------------

                                                                        $      2,010,083        $       2,214,272
                                                                         ===============         ================

LIABILITIES AND PARTNERS' EQUITY (DEFICIT)

Liabilities -
   Accrued fees and expenses due to general partner
    and affiliates (Note 3)                                             $        871,377        $         758,827
                                                                         ---------------         ----------------

Partners' equity (deficit):
   General partner                                                               (48,155)                 (44,988)
   Limited partners (12,000 units authorized; 7,000
    units issued and outstanding at December 31,
    1997 and 1996)                                                             1,186,861                1,500,433
                                                                         ---------------         ----------------

         Total partners' equity                                                1,138,706                1,455,445
                                                                         ---------------         ----------------

                                                                        $      2,010,083        $       2,214,272
                                                                         ===============         ================
</TABLE>

                 See accompanying notes to financial statements
                                      FS-2
<PAGE>


                      WNC HOUSING TAX CREDIT FUND II, L.P.
                       (A California Limited Partnership)

                            STATEMENTS OF OPERATIONS

              For The Years Ended December 31, 1997, 1996 and 1995


<TABLE>
<CAPTION>

                                                       1997                    1996                     1995
                                                  ----------------        ----------------        -----------------
<S>                                            <C>                     <C>                     <C>    

Interest income                                 $          5,785        $         10,157        $          11,368
                                                 ---------------         ---------------         ----------------

Operating expenses:
   Amortization (Note 3)                                  21,352                  21,352                   23,266
   Partnership management fees
    (Note 3)                                             144,903                 144,903                  144,903
   Other                                                  13,248                  67,906                   18,248
                                                 ---------------         ---------------         ----------------

         Total operating expenses                        179,503                 234,161                  186,417
                                                 ---------------         ---------------         ----------------

Loss from operations                                    (173,718)               (224,004)                (175,049)

Equity in losses from limited
 partnerships (Note 2)                                  (143,021)               (568,488)                (602,163)
                                                 ---------------         ---------------         ----------------

Net loss                                        $       (316,739)        $      (792,492)       $        (777,212)
                                                ================         ===============        =================

Net loss allocated to:
   General partner                              $         (3,167)       $         (7,925)       $          (7,772)
                                                 ===============         ===============         ================
   Limited partners                             $       (313,572)       $       (784,567)       $        (769,440)
                                                 ===============         ===============         ================

Net loss per limited partner unit               $         (44.80)       $        (112.08)       $         (109.92)
                                                 ===============         ===============         ================

Outstanding weighted limited
 partners units                                            7,000                   7,000                    7,000
                                                 ===============         ===============         ================

</TABLE>

                 See accompanying notes to financial statements
                                      FS-3
<PAGE>


                      WNC HOUSING TAX CREDIT FUND II, L.P.
                       (A California Limited Partnership)

                    STATEMENTS OF PARTNERS' EQUITY (DEFICIT)

              For The Years Ended December 31, 1997, 1996 and 1995

<TABLE>
<CAPTION>


                                                  General Partner             Limited
                                                                             Partners                  Total
                                                  ----------------        ----------------        -----------------

<S>                                             <C>                    <C>                      <C> 

Equity (deficit) at January 1, 1995             $        (29,291)       $      3,054,440        $       3,025,149


Net loss                                                  (7,772)               (769,440)                (777,212)
                                                ----------------        ----------------         ---------------- 


Equity (deficit) at December 31, 1995                    (37,063)              2,285,000                2,247,937


Net loss                                                  (7,925)               (784,567)               (792,492)
                                                ----------------        ----------------         ---------------- 


Equity (deficit) at December 31, 1996                    (44,988)              1,500,433                1,455,445


Net loss                                                  (3,167)               (313,572)               (316,739)
                                                ----------------        ----------------         ---------------- 


Equity (deficit) at December 31, 1997           $        (48,155)       $      1,186,861        $       1,138,706
                                                 ===============         ===============         ================
</TABLE>


                 See accompanying notes to financial statements
                                      FS-4
<PAGE>


                      WNC HOUSING TAX CREDIT FUND II, L.P.
                       (A California Limited Partnership)

                            STATEMENTS OF CASH FLOWS

              For The Years Ended December 31, 1997, 1996 and 1995


<TABLE>
<CAPTION>

                                                       1997                    1996                     1995
                                                  ----------------        ----------------        -----------------
<S>                                            <C>                     <C>                      <C>   

Cash flows from operating activities:
   Net loss                                     $       (316,739)       $       (792,492)       $        (777,212)
   Write-off of receivables from
     limited partnerships                                      -                  52,726                        -
   Adjustments to reconcile net loss to
     net cash used in operating activities:
       Amortization                                       21,352                  21,352                   23,266
       Equity in loss from limited
        partnerships                                     143,021                 568,488                  602,163
       Change in other assets                                587                     344                      357
       Increase in accrued fees and
         expenses due to general partner
         and affiliates                                  112,550                 107,952                  145,983
                                                 ---------------         ---------------         ----------------

   Net cash used in operating activities                 (39,229)                (41,630)                  (5,443)
                                                 ---------------         ---------------         ----------------

Cash flows provided by investing
 activities -
   Distributions from limited partnerships                12,239                  11,451                    6,186
                                                 ---------------         ---------------         ----------------

Net change in cash and cash equivalents                  (26,990)                (30,179)                     743

Cash and cash equivalents, beginning
  of year                                                208,303                 238,482                  237,739
                                                 ---------------         ---------------         ----------------

Cash and cash equivalents, end of year          $        181,313        $        208,303        $         238,482
                                                 ===============         ===============         ================

SUPPLEMENTAL DISCLOSURE OF
 CASH FLOW INFORMATION:

   Interest paid                                $              -        $              -        $               -
                                                 ===============         ===============         ================
   Taxes paid                                   $            800        $            800        $             800
                                                 ===============         ===============         ================
</TABLE>

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING ACTIVITY:

   During 1995, the Partnership  decreased its  investments in partnerships  and
   recorded a receivable from limited partnerships amounting to $52,726.  During
   1996, such amounts were written-off as uncollectible.

                 See accompanying notes to financial statements
                                      FS-5
<PAGE>


                      WNC HOUSING TAX CREDIT FUND II, L.P.
                       (A California Limited Partnership)

                          NOTES TO FINANCIAL STATEMENTS

              For The Years Ended December 31, 1997, 1996 and 1995




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

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

WNC Housing Tax Credit Fund II, L.P. (A  California  Limited  Partnership)  (the
"Partnership")  was  formed on January  19,  1990 under the laws of the State of
California.  The  Partnership  was formed to invest  primarily in other  limited
partnerships  which  own and  operate  multifamily  housing  complexes  that are
eligible for low income housing tax credits.

WNC Financial  Group,  L.P., a California  partnership,  is the general  partner
("General  Partner") of the Partnership.  WNC & Associates,  Inc. is the general
partner of WNC Financial  Group,  L.P. Other officers and key employees of WNC &
Associates, Inc. are limited partners.

The Partnership  shall continue in full force and effect until December 31, 2045
unless  terminated  prior to that date pursuant to the partnership  agreement or
law.

The Partnership  Agreement  authorized the sale of up to 12,000 units of Limited
Partnership  Interest  at  $1,000  per Unit  ("Units").  The  offering  of Units
concluded  on  December  31,  1992  at  which  time  7,000  Units,  representing
subscriptions  in the  amount of  $7,000,000,  had been  accepted.  The  General
Partner has a 1% interest in  operating  profits and losses of the  Partnership.
The limited  partners will be allocated the remaining 99% interest 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  a
subordinated  disposition  fee (as described in Note 3), 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.

The Partnership's  investments in limited  partnerships are subject to the risks
incident to the management and ownership of multifamily residential real estate,
and  include  the risks  that  neither  the  Partnership's  investments  nor the
apartment   complexes  owned  by  the  limited   partnerships  will  be  readily
marketable.  Additionally there can be no assurance that the Partnership will be
able to dispose of its interests in the limited  partnerships.  The value of the
Partnership's  investments  will be subject to  changes  in  national  and local
economic conditions,  including unemployment  conditions,  which could adversely
impact vacancy levels, rental payment defaults and operating expenses.  This, in
turn,  could  substantially  increase  the  risk  of  operating  losses  for the
apartment  complexes  and the  Partnership.  The  apartment  complexes  could be
subject to loss through  foreclosure.  In addition,  each limited partnership is
subject to risks relating to  environmental  hazards which might be uninsurable.
Because the Partnership's ability to control its operations will depend on these
and other  factors  beyond the  control of the  General  Partner and the general
partners of the limited partnerships, there can be no assurance that Partnership
operations will be profitable or that the  anticipated  housing tax credits will
be available to limited partners.

                                      FS-6
<PAGE>


                      WNC HOUSING TAX CREDIT FUND II, L.P.
                       (A California Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

              For The Years Ended December 31, 1997, 1996 and 1995



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

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

The preparation of financial  statements in conformity  with generally  accepted
accounting principles requires management to make estimates and assumptions that
affect  the  reported  amounts  of assets  and  liabilities  and  disclosure  of
contingent assets and liabilities at the date of the financial  statements,  and
the  reported  amounts of revenues  and expenses  during the  reporting  period.
Actual results could 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 each limited  partnership's  results of operations  and
for  any  distributions   received.  The  accounting  policies  of  the  limited
partnerships are consistent with those of the Partnership. Costs incurred by the
Partnership in acquiring the investments in limited partnerships are capitalized
as part of the investment account and are amortized over 30 years (see Note 2).

Losses  from  operating  partnerships  allocated  to  the  Partnership  are  not
recognized to the extent that the  investment  balance  would be adjusted  below
zero.

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

The  Partnership   considers  all  highly  liquid   investments  with  remaining
maturities of three months or less when purchased to be cash  equivalents.  Cash
equivalents consists of a money market account.

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 limited partners' capital.  As of December 31, 1997 and 1996, the
Partnership had incurred  offering  expenses and selling  expenses of $1,036,840
which are reflected as a reduction of partners' equity.



                                      FS-11
<PAGE>
                      WNC HOUSING TAX CREDIT FUND II, L.P.
                       (A California Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

              For The Years Ended December 31, 1997, 1996 and 1995




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

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

Net loss per limited partner unit was computed by dividing the limited partners'
share of net loss by the weighted number of limited partner units outstanding.

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

As of  December  31,  1997  and  1996,  the  Partnership  has  acquired  limited
partnership interests in twenty-seven limited partnerships which own and operate
apartment  complexes  consisting of 784 apartment units. The respective  general
partners of the limited  partnerships  manage the  day-to-day  operations of the
limited  partnerships.   Significant  limited  partner  business  decisions,  as
defined, require the approval of the Partnership.  The Partnership, as a limited
partner, is generally entitled to 99% of the operating profits and losses of the
limited partnerships.

The   Partnership's   investment  in  limited   partnerships  as  shown  in  the
accompanying  balance  sheets at December  31,  1997 and 1996 are  approximately
$905,000 and $503,000,  respectively,  greater than the Partnership's  equity as
shown  in  the  limited  partnerships'   combined  financial  statements.   This
difference is due to unrecorded loss, as discussed below, and to acquisition and
other costs related to the  acquisition of the limited  partnerships  which were
capitalized to the Partnership's investment account. Capitalized costs are being
amortized over 30 years (see Note 3).

Equity in losses  from  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 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  received by 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  December  31, 1997 and 1996,  the  investment  accounts  in certain  limited
partnerships have reached a zero balance.  Consequently, the Partnership's share
of losses  during the year ended  December 31, 1997  amounting to  approximately
$427,000 have not been recognized.  As of December 31, 1997, the aggregate share
of net losses not recognized by the Partnership amounted to $427,000.



                                      FS-11
<PAGE>
                      WNC HOUSING TAX CREDIT FUND II, L.P.
                       (A California Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

              For The Years Ended December 31, 1997, 1996 and 1995




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

The following is a summary of the equity method  activity of the  investments in
limited partnerships for the years ended December 31:
<TABLE>
<CAPTION>

                                                                               1997                    1996
                                                                          ---------------         ---------------
<S>                                                                    <C>                     <C>                      

Investments per balance sheet, beginning of year                        $      2,005,382        $       2,606,673
Equity in losses of limited partnerships                                        (143,021)                (568,488)
Distributions                                                                    (12,239)                 (11,451)
Amortization of capitalized acquisition costs and fees                           (21,352)                 (21,352)
                                                                         ---------------         ----------------

                                                                        $      1,828,770        $       2,005,382
                                                                         ===============         ================
</TABLE>

The  financial  information  from the  individual  financial  statements  of the
limited partnerships include rental and interest subsidies. Rental subsidies are
included in total  revenues  and  interest  subsidies  are  generally  netted in
interest expense.  Approximate combined condensed financial information from the
individual  financial  statements of the limited  partnerships as of December 31
and for the years then ended is as follows:
<TABLE>
<CAPTION>

                        COMBINED CONDENSED BALANCE SHEETS

                                                                               1997                    1996
                                                                          ---------------         ---------------


ASSETS
<S>                                                                    <C>                      <C>

Buildings and improvements, net of accumulated
 depreciation of $6,159,000 and $5,308,000 for 1997
 and 1996, respectively                                                 $     22,715,000        $      23,499,000
Land                                                                           1,354,000                1,354,000
Other assets                                                                   1,812,000                1,780,000
                                                                         ---------------         ----------------

                                                                        $     25,881,000        $      26,633,000
                                                                         ===============         ================

LIABILITIES AND PARTNER'S CAPITAL

Mortgage loans payable                                                  $     23,195,000        $      23,640,000
Other liabilities                                                                983,000                  695,000
                                                                         ---------------         ----------------
         Total liabilities                                                    24,178,000               24,335,000
                                                                         ---------------         ----------------

Partners' capital:
   WNC Housing Tax Credit Fund II, L.P.                                          924,000                1,502,000
   Other partners                                                                779,000                  796,000
                                                                         ---------------         ----------------
         Total partners' capital                                               1,703,000                2,298,000
                                                                         ---------------         ----------------

                                                                        $     25,881,000        $      26,633,000
                                                                         ===============         ================
</TABLE>

                                      FS-11
<PAGE>
                      WNC HOUSING TAX CREDIT FUND II, L.P.
                       (A California Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

              For The Years Ended December 31, 1997, 1996 and 1995




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

<TABLE>
<CAPTION>

                   COMBINED CONDENSED STATEMENTS OF OPERATIONS

                                                       1997                    1996                     1995
                                                  ----------------        ----------------        -----------------
<S>                                             <C>                    <C>                     <C>

Total revenues, including interest
 and rent subsidies                             $      3,179,000        $      3,068,000        $       3,275,000
                                                 ---------------         ---------------         ----------------

Expenses:
   Operating expenses                                  1,984,000               1,837,000                1,724,000
   Interest expense                                      920,000                 937,000                1,262,000
   Depreciation and amortization                         851,000                 868,000                  897,000
                                                 ---------------         ---------------         ----------------

         Total expenses                                3,755,000               3,642,000                3,883,000
                                                 ---------------         ---------------         ----------------

Net loss                                        $       (576,000)       $       (574,000)       $        (608,000)
                                                 ===============         ===============         ================ 

Net loss allocable to the Partnership           $       (570,000)       $       (568,000)       $        (602,000)
                                                 ===============         ===============         ================ 
</TABLE>

During all periods presented,  certain limited  partnerships  incurred operating
losses  and  had  working  capital  deficiencies.  In the  event  these  limited
partnerships  incur  significant  operating  losses  in the  future,  additional
capital  contributions  by  the  Partnership  may be  required  to  sustain  the
operations of such limited partnerships. If additional capital contributions are
not made when they are required, the Partnership's investment in certain of such
limited partnerships could be impaired.

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

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

          Selection  fees  equal to 9% of the  gross  proceeds  from the sale of
          partnership  units as compensation to the General Partner for services
          rendered to the  Partnership  in connection  with the  acquisition  of
          limited partnerships. As of December 31, 1997 and 1996, selection fees
          of $630,000  have been  incurred  and  included  in the  Partnership's
          investment in limited partnerships.  Accumulated amortization amounted
          to  $139,731   and   $118,731  as  of  December  31,  1997  and  1996,
          respectively.

          Reimbursement of costs incurred by an affiliate of the General Partner
          in connection  with the  acquisition  of limited  partnerships.  These
          reimbursements  have not exceeded  1.7% of the gross  proceeds.  As of
          December 31, 1997 and 1996, the Partnership incurred acquisition costs
          of $10,581 which have been included in limited partnership investment.
          Accumulated  amortization amounted to $2,796 and $2,444 as of December
          31, 1997 an 1996, respectively.


                                      FS-11
<PAGE>
                      WNC HOUSING TAX CREDIT FUND II, L.P.
                       (A California Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

              For The Years Ended December 31, 1997, 1996 and 1995




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

          An annual  management fee equal to 0.5% of the invested  assets of the
          limited   partnerships,   as  defined,   including  the  Partnership's
          allocable  share of the  mortgages.  Management  fees of $144,903 were
          incurred  during 1997, 1996 and 1995,  respectively,  of which $32,000
          and $35,000 were paid in 1997 and 1996, respectively.

          A subordinated  disposition  fee in an amount equal to 1% of the sales
          price of any property sold. Payment of this fee to the General Partner
          is  subordinated  to the limited  partners  who receive a 6% preferred
          return (as defined in the  Partnership  Agreement) and is payable only
          if the General Partner or its affiliates render services.

Accrued fees and expenses due to general  partner and affiliates  consist of the
following at December 31:
<TABLE>
<CAPTION>

                                                                                       December 31,
                                                                          ---------------------------------------
                                                                               1997                    1996
                                                                          ---------------         ---------------
<S>                                                                    <C>                     <C>            

Annual management fee                                                   $        871,114        $         758,211
Reimbursement due on expenses paid by affiliate                                      263                      616
                                                                         ---------------         ----------------

Total related party payables                                            $        871,377        $         758,827
                                                                         ===============         ================
</TABLE>

NOTE 4 - INCOME TAXES
---------------------

No provision  for income taxes has been recorded in the  accompanying  financial
statements  since all items of taxable  income and loss will be allocated to the
partners for inclusion in their respective income tax returns.

                                      FS-11

         
<PAGE>

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

None.

Item 10.  Directors and Executive Officers of the Registrant

Directors of Registrant

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

Directors and Executive Officers of WNC & Associates, Inc.


The directors of Associates  are Wilfred N. Cooper,  Sr., who serves as Chairman
of the Board, John B. Lester,  Jr., David N. Shafer,  Wilfred N. Cooper, Jr. and
Kay L.  Cooper.  Substantially  all of the  shares  of  Associates  are owned by
Wilfred N. Cooper,  Sr., through the Cooper Revocable Trust, and John B. Lester,
Jr., through the Lester Family Trust.

WILFRED  N.  COOPER,  SR.,  age 67,  has been the  principal  shareholder  and a
Director of WNC & ASSOCIATES,  INC. since its  organization  in 1971, of SHELTER
RESOURCE  CORPORATION since its organization in 1981 and of WNC RESOURCES,  INC.
from its organization in 1988 through its acquisition by WNC & ASSOCIATES,  INC.
in 1991,  serving  as  President  of  those  companies  until  1992 and as Chief
Executive Officer since 1992, and has been a Director of WNC CAPITAL CORPORATION
since its organization. He is also a general partner with WNC & ASSOCIATES, INC.
in WNC FINANCIAL GROUP,  L.P. and WNC TAX CREDIT PARTNERS,  L.P. During 1970 and
1971  he  was  a  principal  of  Creative  Equity  Development  Corporation,   a
predecessor of WNC & ASSOCIATES,  INC., and of Creative  Equity  Corporation,  a
real estate investment firm. For 12 years prior to that, Mr. Cooper was employed
by Rockwell  International  Corporation,  last serving as its manager of housing
and urban  developments.  Previously,  he had  responsibility  for new  business
development including factory-built housing evaluation and project management in
urban  planning  and  development.  Mr.  Cooper is a Director  of the  Executive
Committee  of the  National  Association  of  Home  Builders  (NAHB)  and a past
Chairman of the NAHB's Rural Housing Council, a Director of the National Housing
Conference,  a Director of the Affordable  Housing Tax Credit Coalition,  a past
President of the California Council of Affordable Housing (CCAH) (formerly Rural
Builders  Council of  California),  and a past President of Southern  California
Chapter II of the Real Estate  Syndication and Securities  Institute  (RESSI) of
the National  Association of Realtors  (NAR).  Mr. Cooper  graduated from Pomona
College in 1956 with a Bachelor of Arts degree.

JOHN B. LESTER, JR., age 64, has been a shareholder, a Director and Secretary of
WNC & ASSOCIATES,  INC. since 1986,  Executive Vice President from 1986 to 1992,
and President and Chief Operating Officer since 1992, and has been a Director of
WNC CAPITAL CORPORATION since its organization. He was a shareholder,  Executive
Vice  President,  Secretary  and a Director  of WNC  RESOURCES,  INC.  from 1988
through its acquisition by WNC & ASSOCIATES,  INC. in 1991. From 1973 to 1986 he
was Chairman of the Board and Vice  President or President of E & L  Associates,
Inc., a provider of engineering  and  construction  services to the oil refinery
and petrochemical industries which he co-founded in 1973. Mr. Lester is a former
Director of the Los Angeles  Chapter of the  Associated  General  Contractors of
California.  His  responsibilities  at WNC & ASSOCIATES,  INC.  include property
acquisitions and company operations. Mr. Lester graduated from the University of
Southern  California  in 1956 with a Bachelor  of Science  degree in  Mechanical
Engineering.

                                       10


<PAGE>

DAVID N. SHAFER,  age 45, has been a Director of WNC &  ASSOCIATES,  INC.  since
1997, a Senior Vice President  since 1992,  and General  Counsel since 1990, and
served as Asset  Management  Director from 1990 to 1992, and has been a Director
and Secretary of WNC Management, Inc. since its organization.  Previously he was
employed as an associate attorney by the law firms of Morinello,  Barone, Holden
& Nardulli  from 1987 until  1990,  Frye,  Brandt & Lyster from 1986 to 1987 and
Simon and Sheridan from 1984 to 1986.  Mr. Shafer is a Director and President of
CCAH, a member of NAHB's Rural  Housing  Council,  a past  President of Southern
California Chapter II of RESSI, a past Director of the Council of Affordable and
Rural Housing and Development  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 and from the  University of San Diego in 1986 with a Master
of Law degree in Taxation.

WILFRED N. COOPER,  JR.,  age 35, has been  employed by WNC &  ASSOCIATES,  INC.
since 1988 and has been a Director since 1997  Executive  Vice  President  since
1998, and a Senior Vice President  since 1992. Mr. Cooper heads the  Acquisition
Originations  department  at  WNC,  has  been  President  of,  and a  registered
principal with, WNC CAPITAL  CORPORATION,  a member firm of the NASD,  since its
organization,  and  has  been  a  Director  of WNC  Management  Inc.  since  its
organization.  Previously,  he was employed as a government affairs assistant by
Honda North America from 1987 to 1988, and as a legal  assistant with respect to
Federal  legislative and regulatory  matters by the law firm of Schwartz,  Woods
and Miller from 1986 to 1987. Mr. Cooper is an alternate  director and member of
NAHB's Rural Housing Council and serves as Chairman of its Membership Committee.
Mr.  Cooper  graduated  from The American  University in 1985 with a Bachelor of
Arts degree.

THEODORE M. PAUL, age 42, has been Vice President - Finance of WNC & ASSOCIATES,
INC. since 1992 and Chief Financial  Officer since 1990, and has been a Director
and Chief  Financial  Officer of WNC  Management  Inc.  since its  organization.
Previously,  he was a Vice  President  and Chief  Financial  Officer of National
Partnership  Investments  Corp.,  a sponsor  and general  partner of  syndicated
partnerships  investing in affordable  rental housing qualified for tax credits,
from 1986 until 1990, and was employed as an associate by the  accounting  firms
of Laventhol & Horwath,  during 1985, and Mann & Pollack Accountants,  from 1979
to 1984.  Mr. Paul is a member of the  California  Society of  Certified  Public
Accountants  and the American  Institute of Certified  Public  Accountants.  His
responsibilities  at WNC &  ASSOCIATES,  INC.  include  supervision  of investor
partnership  accounting  and tax reporting  matters and monitoring the financial
condition  of the  Local  Limited  Partnerships  in which the  Partnership  will
invest.  Mr.  Paul  graduated  from the  University  of  Illinois in 1978 with a
Bachelor of Science degree and is a Certified Public  Accountant in the State of
California.

THOMAS J. RIHA,  age 43, has been Vice  President  - Asset  Management  of WNC &
ASSOCIATES, INC. since 1994, and has been a Director and Chief Executive Officer
of WNC  Management  Inc.  since  its  organization.  He has more  than 17 years'
experience in commercial and multi-family real estate investment and management.
Previously,  Mr.  Riha was  employed  by Trust  Realty  Advisor,  a real  estate
acquisition  and  management  company,  from 1988 to 1994,  last serving as Vice
President - Operations.  His responsibilities at WNC & ASSOCIATES,  INC. include
monitoring  the  operations  and  financial   performance   of,  and  regulatory
compliance  by,  properties in the WNC  portfolio.  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 in the State of  California  and a member of the
American Institute of Certified Public Accountants.

SY P. GARBAN, age 52, has 20 years' experience in the real estate securities and
syndication industry. He has been associated with WNC & ASSOCIATES,  INC., since
1989,  serving as National Sales  Director  through 1992 and as Vice President -
National  Sales since  1992.  Previously,  he was  employed  as  Executive  Vice
President by MRW,  Inc.,  Newport  Beach,  California  from 1980 to 1989, a real
estate  development  and  management  firm.  Mr.  Garban  is  a  member  of  the
International  Association  of Financial  Planners.  He graduated  from Michigan
State  University  in  1967  with a  Bachelor  of  Science  degree  in  Business
Administration.

                                       11
<PAGE>

CARL FARRINGTON,  age 55, has been associated with WNC & ASSOCIATES,  INC. since
1993, and has served as Director - Originations  since 1994. Mr.  Farrington has
more  than 12  years'  experience  in  finance  and  real  estate  acquisitions.
Previously,  he served as Acquisitions Director for The Arcand Company from 1991
to 1993, and as Treasurer and Director of Finance and Administrator for Polytron
Corporation  from 1988 to 1991.  Mr.  Farrington is a member and Director of the
Council  of  Affordable  and  Rural  Housing  and  Development.  Mr.  Farrington
graduated from Yale  University  with a Bachelor of Arts degree in 1966 and from
Dartmouth College with a Master of Business Administration in 1970.

DAVID TUREK, age 43, has been Director - Originations of WNC & ASSOCIATES,  INC.
since 1996. He has 23 years' experience in real estate finance and acquisitions.
Previously,  from 1995 to 1996 Mr. Turek  served as a consultant  for a national
Low  Income  Housing  Credit  sponsor  where  he  was  responsible  for  on-site
feasibility  studies and due  diligence  analyses of Low Income  Housing  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 Low Income
Housing  Credit  development  activities.  Mr.  Turek  graduated  from  Southern
Methodist University in 1976 with a Bachelor of Business Administration degree.

N. PAUL BUCKLAND, age 36, has been employed by WNC & ASSOCIATES, INC. since 1994
and currently serves as Vice President Acquisitions. He has 11 years' experience
in  analysis  pertaining  to the  development  of  multi-family  and  commercial
properties.  Previously,  from 1986 to 1994 he served on the development team of
the Bixby Ranch which  constructed  more than 700 apartment  units and more than
one million square feet of "Class A" office space in California and  neighboring
states,  and from 1984 to 1986 he served as a land acquisition  coordinator with
Lincoln  Property   Company  where  he  identified  and  analyzed   multi-family
developments. Mr. Buckland graduated from California State University, Fullerton
in 1992 with a Bachelor of Science degree in Business Finance.

MICHELE M. TAYLOR,  age 43, has been  employed by WNC & ASSOCIATES,  INC.  since
1986,  serving as a paralegal and office manager,  and currently is the Investor
Services  Director.  Previously she was  self-employed  between 1982 and 1985 in
non-financial  services  activities  and from 1978 to 1981 she was employed as a
paralegal by a law firm which  specialized  in real estate  limited  partnership
transactions.  Ms. Taylor graduated from the University of California, Irvine in
1976 with a Bachelor of Arts degree.

THERESA I. CHAMPANY,  age 40, has been employed by WNC & ASSOCIATES,  INC. since
1989 and currently is the Marketing Services Director and a registered principal
with WNC  CAPITAL  CORPORATION.  Previously,  she was  employed  as  Manager  of
Marketing  Services  by August  Financial  Corporation  from 1986 to 1989 and as
office manager and Assistant to the Vice  President of Real Estate  Syndications
by  McCombs  Securities  Co.,  Inc.  from 1979 to 1986.  Ms.  Champany  attended
Manchester (Conn.) Community College from 1976 to 1978.

KAY L.  COOPER,  age 61, has been an officer and  Director of WNC &  ASSOCIATES,
INC. since 1971 and of WNC RESOURCES,  INC. from 1988 through its acquisition by
WNC & ASSOCIATES, INC. in 1991. Mrs. Cooper has also been the sole proprietor of
Agate 108, a manufacturer and retailer of home accessory  products,  since 1975.
She is the wife of Wilfred N. Cooper,  Sr., the mother of Wilfred N. Cooper, Jr.
and the sister of John B. Lester,  Jr. Mrs. Cooper graduated from the University
of Southern California

                                       12
<PAGE>

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 Associates for the following fees:

(a) Organization and Offering Expenses. The Partnership paid the General Partner
or its affiliates as of December 31, 1997  approximately  $1,037,000 for selling
commissions and other fees and expenses of the Partnership's  offering of Units.
Of the  total  paid to the  General  Partner  or its  affiliates,  approximately
$1,037,000  was paid  (reallowed)  by the General  Partner or its  affiliates to
unaffiliated  persons  participating in the Partnership's  offering or rendering
other services in connection with the Partnership's offering.

(b)  Acquisition  fees in an  amount  equal to 9% of the gross  proceeds  of the
Partnership's  offering  ("Gross  Proceeds").  The Partnership  paid the General
Partner or its affiliates as of December 31, 1997 acquisition fees of $630,000.

(c) The  Partnership  reimbursed  the General  Partner or its  affiliates  as of
December 31, 1997 for acquisition expenses expended by such persons on behalf of
the Partnership in the amounts $10,581.

(d) An annual asset management fee in an amount equal to 0.5% of invested assets
(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  Apartment  Complexes  owned by such Local  Limited
Partnerships.) Fees of $144,903, $144,903, $144,903, $144,903, and $134,168 were
incurred for 1997, 1996, 1995,1994, and 1993, respectively.

(e) A  subordinated  disposition  fee in an amount equal to 1% of the sale price
received in connection  with the sale or disposition of an Apartment  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.  "6% Preferred
Return"  means a 6%  annual,  cumulative  but not  compounded,  "return"  to the
Limited Partners  (including Low Income Housing Credits) as a class on their net
capital  contributions.  For this purpose, the net capital  contributions of the
Limited Partners shall be equal to their Capital  Contributions,  reduced by the
amount treated as returned to the Limited Partners.


(f) The General  Partner was allocated Low Income Housing Credits of $10,257 and
10,258 for 1997 and 1996, respectively.


Item 12.  Security Ownership of Certain Beneficial Owners and Management

(a)  Security Ownership of Certain Beneficial Owners

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

                                       13
<PAGE>

(b)      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.

(c)  Changes in Control

The management and control of the General Partners 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 anytime remove the General
Partner of the Partnership and elect a successor General Partner

Item 13.  Certain Relationships and Related Transactions

WNC &  Associates,  Inc.  All of the  Partnership's  affairs  are managed by the
General Partner,  through Associates.  The transactions with the General Partner
and  Associates  are primarily in the form of fees paid by the  Partnership  for
services  rendered to the Partnership,  as discussed in Item 11 and in the notes
to the accompanying financial statements.

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

Financial Statements: Report of independent public accountants.

Balance sheet as of December 31, 1997 and 1996.

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

Statement of Partners'  Equity for the years ended December 31, 1997,  1996, and
1995.

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

Notes to Financial Statements.

Financial Statement Schedules
N/A

                                       14
<PAGE>

Exhibits

(3) Articles of incorporation  and by-laws:  The registrant is not incorporated.
The Partnership  Agreement is included as Exhibit B to the Prospectus,  filed as
Exhibit 28.1 to Form 10 K for the year ended  December 31, 1994.  (10)  Material
contracts  10.1  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
10.1.

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

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

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

10.5  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 10.5.

10.6 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 10.6.

Reports on Form 8-K

No  current  reports of Form 8-K were filed  during  the  fourth  quarter  ended
December 31, 1997.

<PAGE>


         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 HOUSING TAX CREDIT FUND II, L.P.

By:  WNC Financial Group, L.P.      General Partner of the Registrant
By:  WNC & Associates, Inc.         General Partner of WNC Financial Group, L.P.



By:          /s/ John B. Lester, Jr.
-----------------------------------------------------
John B. Lester, Jr.        President of WNC & Associates, Inc.
Date: April 13, 1998



By:          /s/ Theodore M. Paul
-----------------------------------------------------
Theodore M. Paul  Vice-president Finance of WNC & Associates, Inc.
Date: April 13, 1998


         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, Sr.
-----------------------------------------------------
Wilfred N. Cooper, Sr.      Chairman of the Board of WNC & Associates, Inc.
Date: April 13, 1998



By:          /s/ John B. Lester, Jr.
-----------------------------------------------------
John B. Lester, Jr.        Director of WNC & Associates, Inc.
Date: April 13, 1998


By:          /s/ David N. Shafer.
-----------------------------------------------------
John B. Lester, Jr.        Director of WNC & Associates, Inc.
Date: April 13, 1998