<PAGE>

                                    FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

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

               For the quarterly period ended   September 30, 1999
                                              ------------------------

                                      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
                                    0-17549
                           --------------------------

                            CNL Income Fund IV, Ltd.
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)


             Florida                                           59-2854435
--------------------------------------               ---------------------------
  (State or other jurisdiction of                            (I.R.S. Employer
  incorporation or organization)                            Identification No.)


         450 South Orange Avenue
             Orlando, Florida                                      32801
--------------------------------------               ---------------------------
 (Address of principal executive offices)                       (Zip Code)


Registrant's telephone number
(including area code)                                        (407) 540-2000
                                                     ---------------------------

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Sections 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
                                       ---    ---
<PAGE>

                                    CONTENTS



                                                                           Page
                                                                           ----
Part I.

  Item 1.   Financial Statements:

                Condensed Balance Sheets                                   1

                Condensed Statements of Income                             2

                Condensed Statements of Partners' Capital                  3

                Condensed Statements of Cash Flows                         4

                Notes to Condensed Financial Statements                    5-7

  Item 2.   Management's Discussion and Analysis of Financial
                Condition and Results of Operations                        8-16

  Item 3.   Quantitative and Qualitative Disclosures About
                Market Risk                                                16

Part II.

  Other Information                                                        17-19
<PAGE>

                            CNL INCOME FUND IV, LTD.
                         (A Florida Limited Partnership)
                            CONDENSED BALANCE SHEETS

<TABLE>
<CAPTION>

                                                          September 30,      December 31,
                                                               1999              1998
                                                          --------------    --------------
   <S>                                                    <C>               <C>
                        ASSETS
                        ------

   Land and buildings on operating leases, less
       accumulated depreciation of $4,048,725 and
       $3,744,609 in 1999 and 1998, respectively           $ 15,182,343      $ 15,486,459
   Net investment in direct financing leases                  1,200,393         1,231,482
   Investment in joint ventures                               3,336,078         2,862,906
   Cash and cash equivalents                                    793,000           739,382
   Restricted cash                                                   --           537,274
   Receivables, less allowance for doubtful accounts
       of $235,908 and $258,641, in 1999 and 1998,
       respectively                                              36,043            24,676
   Prepaid expenses                                              14,015             9,836
   Lease costs, less accumulated amortization of
       $24,824 and $21,450, in 1999 and 1998,
       respectively                                              30,320            18,094
   Accrued rental income                                        309,774           279,724
                                                          --------------    --------------

                                                           $ 20,901,966      $ 21,189,833
                                                          ==============    ==============

          LIABILITIES AND PARTNERS' CAPITAL
          ---------------------------------

   Accounts payable                                        $    128,858      $      4,503
   Accrued and escrowed real estate taxes payable                66,944            36,732
   Distributions payable                                        600,000           600,000
   Due to related party                                         192,846           148,978
   Rents paid in advance and deposits                            98,361            59,620
                                                          --------------    --------------
       Total liabilities                                      1,087,009           849,833

   Commitments and Contingencies (Note 4)

   Partners' capital                                         19,814,957        20,340,000
                                                          --------------    --------------

                                                           $ 20,901,966      $ 21,189,833
                                                          ==============    ==============
</TABLE>



            See accompanying notes to condensed financial statements.

                                       1
<PAGE>

                            CNL INCOME FUND IV, LTD.
                         (A Florida Limited Partnership)
                         CONDENSED STATEMENTS OF INCOME

<TABLE>
<CAPTION>

                                                          Quarter Ended               Nine Months Ended
                                                          September 30,                 September 30,
                                                        1999          1998          1999            1998
                                                    -----------   -----------   ------------   -------------
<S>                                                 <C>           <C>           <C>            <C>
Revenues:
    Rental income from operating leases              $ 515,904     $ 547,853     $1,509,297     $1,598,854
    Earned income from direct financing leases          30,595        31,630         92,585         95,611
    Contingent rental income                            30,685            --         65,059         37,207
    Interest and other income                            7,288        24,951         24,257         46,143
                                                    -----------   -----------   ------------   -------------
                                                       584,472       604,434      1,691,198      1,777,815
                                                    -----------   -----------   ------------   -------------

Expenses:
    General operating and administrative                31,987        46,096        103,577        121,811
    Professional services                                6,665         5,999         28,029         38,644
    Real estate taxes                                    6,257        26,225         20,112         46,980
    State and other taxes                                1,635            --         17,030         15,747
    Depreciation and amortization                      102,486       104,058        307,490        326,835
    Transaction costs                                   52,300            --        156,466             --
                                                    -----------   -----------   ------------   -------------
                                                       201,330       182,378        632,704        550,017
                                                    -----------   -----------   ------------   -------------

Income Before Equity in Earnings (Loss) of
    Joint Ventures and Gain on Sale of Land and
    Buildings                                          383,142       422,056      1,058,494      1,227,798

Equity in Earnings (Loss) of Joint Ventures             69,847         5,276        216,463       (143,612)

Gain on Sale of Land and Buildings                          --       170,281             --        226,024
                                                    -----------   -----------   ------------   -------------


Net Income                                           $ 452,989     $ 597,613     $1,274,957     $1,310,210
                                                    ===========   ===========   ============   =============

Allocation of Net Income:
    General partners                                     4,529       $ 5,195       $ 12,749     $    7,612
    Limited partners                                   448,460       592,418      1,262,208      1,302,598
                                                    -----------   -----------   ------------   -------------

                                                     $ 452,989     $ 597,613     $1,274,957     $1,310,210
                                                    ===========   ===========   ============   =============

Net Income Per Limited Partner Unit                  $    7.47     $    9.87     $    21.04     $    21.71
                                                    ===========   ===========   ============   =============

Weighted Average Number of Limited Partner
    Units Outstanding                                   60,000        60,000         60,000         60,000
                                                    -----------   -----------   ------------   -------------
</TABLE>

            See accompanying notes to condensed financial statements.

                                       2
<PAGE>

                            CNL INCOME FUND IV, LTD.
                         (A Florida Limited Partnership)
                    CONDENSED STATEMENTS OF PARTNERS' CAPITAL

<TABLE>
<CAPTION>

                                                 Nine Months Ended        Year Ended
                                                   September 30,         December 31,
                                                        1999                 1998
                                                -------------------    ----------------
<S>                                             <C>                    <C>
General partners:
    Beginning balance                                  $   769,078         $   756,354
    Net income                                              12,749              12,724
                                                      -------------       -------------
                                                           781,827             769,078
                                                      -------------       -------------

Limited partners:
    Beginning balance                                   19,570,922          21,395,945
    Net income                                           1,262,208           1,808,725
    Distributions ($30.00 and $60.56 per
       limited partner unit, respectively)              (1,800,000)         (3,633,748)
                                                      -------------       -------------
                                                        19,033,130          19,570,922
                                                      -------------       -------------

Total partners' capital                                $19,814,957         $20,340,000
                                                      =============       =============
</TABLE>




            See accompanying notes to condensed financial statements.

                                       3
<PAGE>

                            CNL INCOME FUND IV, LTD.
                         (A Florida Limited Partnership)
                       CONDENSED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                 Nine Months Ended
                                                                     September 30,
                                                                1999            1998
                                                           -------------    -------------
<S>                                                        <C>              <C>
Increase (Decrease) in Cash and Cash Equivalents

    Net Cash Provided by Operating Activities               $ 1,868,820      $ 1,794,173
                                                           -------------    -------------

    Cash Flows from Investing Activities:
       Additions to land and buildings on operating
          leases                                                     --         (275,000)
       Proceeds from sale of land and buildings                      --        2,526,354
       Investment in joint ventures                            (533,200)        (499,274)
       Decrease (increase) in restricted cash                   533,598         (533,598)
       Payment of lease costs                                   (15,600)              --
                                                           -------------    -------------
              Net cash provided by (used in) investing
                  activities                                    (15,202)       1,218,482
                                                           -------------    -------------

    Cash Flows from Financing Activities:
       Distributions to limited partners                     (1,800,000)      (3,123,748)
                                                           -------------    -------------
              Net cash used in financing activities          (1,800,000)      (3,123,748)
                                                           -------------    -------------

Net Increase (Decrease) in Cash and Cash Equivalents             53,618         (111,093)

Cash and Cash Equivalents at Beginning of Period                739,382          876,452
                                                           -------------    -------------

Cash and Cash Equivalents at End of Period                  $   793,000      $   765,359
                                                           =============    =============

Supplemental Schedule of Non-Cash Investing and
    Financing Activities:

       Deferred real estate disposition fees incurred
          and unpaid at end of period                       $        --      $    45,663
                                                           -------------    -------------

       Distributions declared and unpaid at end
          of period                                         $   600,000      $   600,000
                                                           =============    =============
</TABLE>



            See accompanying notes to condensed financial statements.

                                       4
<PAGE>

                            CNL INCOME FUND IV, LTD.
                         (A Florida Limited Partnership)
                   NOTES TO CONDENSED FINANCIAL STATEMENTS
          Quarters and Nine Months Ended September 30, 1999 and 1998


1.      Basis of Presentation:
        ---------------------

        The accompanying unaudited condensed financial statements have been
        prepared in accordance with the instructions to Form 10-Q and do not
        include all of the information and note disclosures required by
        generally accepted accounting principles. The financial statements
        reflect all adjustments, consisting of normal recurring adjustments,
        which are, in the opinion of management, necessary to a fair statement
        of the results for the interim periods presented. Operating results for
        the quarter and nine months ended September 30, 1999, may not be
        indicative of the results that may be expected for the year ending
        December 31, 1999. Amounts as of December 31, 1998, included in the
        financial statements, have been derived from audited financial
        statements as of that date.

        These unaudited financial statements should be read in conjunction with
        the financial statements and notes thereto included in Form 10-K of CNL
        Income Fund IV, Ltd. (the "Partnership") for the year ended December 31,
        1998.

2.      Investment in Joint Ventures:
        ----------------------------

        In January 1999, the Partnership invested $533,200 in a property in
        Zephyrhills, Florida as tenants-in-common with CNL Income Fund XVII,
        Ltd., a Florida limited partnership and affiliate of the general
        partners. As of September 30, 1999, the Partnership had a 76 percent
        interest in the property. The Partnership accounts for its investment in
        this property using the equity method since the Partnership shares
        control with an affiliate, and amounts relating to its investment are
        included in investment in joint ventures.

                                       5
<PAGE>

                            CNL INCOME FUND IV, LTD.
                         (A Florida Limited Partnership)
                   NOTES TO CONDENSED FINANCIAL STATEMENTS
          Quarters and Nine Months Ended September 30, 1999 and 1998


2.      Investment in Joint Ventures - Continued:
        ----------------------------------------

        The following presents the combined, condensed financial information for
        all of the Partnership's investment in joint ventures and properties
        held as tenants-in-common at:

<TABLE>
<CAPTION>
                                                               September 30,      December 31,
                                                                   1999               1998
                                                              ---------------    --------------
<S>                                                           <C>                <C>
                  Land and buildings on operating
                      leases, less accumulated
                      depreciation and allowance for
                      loss on land and building                 $ 5,255,671        $ 4,406,943
                  Net investment in direct financing
                      lease, less allowance for
                      impairment in carrying value                  374,789            626,594
                  Cash                                               28,258             14,025
                  Receivables                                         1,992             10,943
                  Accrued rental income                             167,570            163,773
                  Other assets                                        2,954              2,513
                  Liabilities                                        45,096             27,211
                  Partners' capital                               5,786,138          5,197,580
                  Revenues                                          453,316            368,058
                  Provision for loss on land and
                      building and net investment in
                      direct financing lease                             --           (441,364)
                  Net income (loss)                                 331,019           (212,388)
</TABLE>

        The Partnership recognized income totaling $216,463 and a loss totaling
        $143,612 for the nine months ended September 30, 1999 and 1998,
        respectively, of which income of $69,847 and $5,276 were recognized for
        the quarters ended September 30, 1999 and 1998, respectively, from these
        joint ventures.

3.      Related Party Transactions:
        --------------------------

        On September 1, 1999, CNL American Properties Fund, Inc. ("APF"), an
        affiliate of the general partners, acquired CNL Fund Advisors, Inc.
        ("CFA"), an affiliate who provides certain services relating to
        management of the Partnership and its properties pursuant to a
        management agreement with the Partnership. As a result of this
        acquisition, CFA became a wholly owned subsidiary of APF; however, the
        terms of the management agreement between the Partnership and CFA remain
        unchanged and in effect.

                                       6
<PAGE>

                            CNL INCOME FUND IV, LTD.
                         (A Florida Limited Partnership)
                   NOTES TO CONDENSED FINANCIAL STATEMENTS
          Quarters and Nine Months Ended September 30, 1999 and 1998


4.      Commitments and Contingencies:
        -----------------------------

        On March 11, 1999, the Partnership entered into an Agreement and Plan of
        Merger with CNL American Properties Fund, Inc. ("APF"), pursuant to
        which the Partnership would be merged with and into a subsidiary of APF
        (the "Merger"). As consideration for the Merger, APF has agreed to issue
        1,334,008 shares of its common stock, par value $0.01 per share (the
        "APF Shares"). In order to assist the general partners in evaluating the
        proposed merger consideration, the general partners retained Valuation
        Associates, a nationally recognized real estate appraisal firm, to
        appraise the Partnership's restaurant property portfolio. Based on
        Valuation Associates' appraisal, the fair value of the Partnership's
        property portfolio and other assets was $26,259,630 as of December 31,
        1998. The APF Shares are expected to be listed for trading on the New
        York Stock Exchange concurrently with the consummation of the Merger,
        and therefore, would be freely tradable at the option of the former
        limited partners. At a special meeting of the partners that is expected
        to be held in the first quarter of 2000, limited partners holding in
        excess of 50% of the Partnership's outstanding limited partnership
        interests must approve the Merger prior to consummation of the
        transaction. If the limited partners at the special meeting approve the
        Merger, APF will own the properties and other assets of the Partnership.
        The general partners intend to recommend that the limited partners of
        the Partnership approve the Merger. In connection with their
        recommendation, the general partners will solicit the consent of the
        limited partners at the special meeting. If the limited partners reject
        the Merger, the Partnership will bear the portion of the transaction
        costs based upon the percentage of "For" votes and the general partners
        will bear the portion of such transaction costs based upon the
        percentage of "Against" votes and abstentions.

        On May 11, 1999, four limited partners in several of the CNL Income
        Funds served a lawsuit against the general partners and APF in
        connection with the proposed Merger. On July 8, 1999, the plaintiffs
        amended the complaint to add three additional limited partners as
        plaintiffs. Additionally, on June 22, 1999, a limited partner in certain
        of the CNL Income Funds served a lawsuit against the general partners,
        APF, CNL Fund Advisors, Inc and certain of its affiliates, in connection
        with the proposed Merger. On September 23, 1999, the judge assigned to
        the two lawsuits entered an order consolidating the two cases. Pursuant
        to this order, the plaintiffs in these cases filed a consolidated and
        amended complaint on November 8, 1999. The various defendants, including
        the general partners, have 45 days to respond to that consolidated
        complaint. The general partners and APF believe that the lawsuits are
        without merit and intend to defend vigorously against the claims. See
        Part II - Item 1. Legal Proceedings.

                                       7
<PAGE>

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

         CNL Income Fund IV, Ltd. (the "Partnership") is a Florida limited
partnership that was organized on November 18, 1987, to acquire for cash, either
directly or through joint venture arrangements, both newly constructed and
existing restaurant properties, as well as land upon which restaurants were to
be constructed, which are leased primarily to operators of national and regional
fast-food and family-style restaurant chains (collectively, the "Properties").
The leases generally are triple-net leases, with the lessees responsible for all
repairs and maintenance, property taxes, insurance and utilities. As of
September 30, 1999, the Partnership owned 38 Properties, which included
interests in six Properties owned by joint ventures in which the Partnership is
a co-venturer and two Properties owned with affiliates of the general partners
as tenants-in-common.

Capital Resources
-----------------

         During the nine months ended September 30, 1999 and 1998, the
Partnership generated cash from operations (which includes cash received from
tenants, distributions from joint ventures, and interest and other income
received, less cash paid for expenses) of $1,868,820 and $1,794,173,
respectively. The increase in cash from operations for the nine months ended
September 30, 1999 is primarily a result of changes in income and expenses as
described in "Results of Operations" below and changes in the Partnership's
working capital.

         Other sources and uses of capital included the following during the
nine months ended September 30, 1999.

         In January 1999, the Partnership used $533,200 of the net sales
proceeds from the 1998 sale of the Property in Naples, Florida to acquire a
Property in Zephyrhills, Florida, as tenants-in-common with CNL Income Fund
XVII, Ltd., a Florida limited partnership and affiliate of the general partners.
In connection therewith, the Partnership and the affiliate entered into an
agreement whereby each co-venturer will share in the profits and losses of the
Property in proportion to its applicable percentage interest. As of September
30, 1999, the Partnership owned a 76 percent interest in the Property in
Zephyrhills, Florida. The sale of the Property in Naples, Florida and the
reinvestment of the net sales proceeds in the Property in Zephyrhills, Florida,
were structured to qualify as a like-kind exchange transaction for federal
income tax purposes.

         Currently, rental income from the Partnership's Properties is invested
in money market accounts or other short-term, highly liquid investments such as
demand deposit accounts at commercial banks, certificates of deposit, and money
market accounts with less than a 30-day maturity date, pending the Partnership's
use of such funds to pay Partnership expenses or to make distributions to the
partners. At September 30, 1999, the Partnership had $793,000 invested in such
short-term investments, as compared to $739,382 at December 31, 1998. The funds
remaining at September 30, 1999 will be used to pay distributions and other
liabilities.

                                       8
<PAGE>

Short-Term Liquidity
--------------------

         The Partnership's short-term liquidity requirements consist primarily
of the operating expenses of the Partnership.

         The Partnership's investment strategy of acquiring Properties for cash
and leasing them under triple-net leases to operators who generally meet
specified financial standards minimizes the Partnership's operating expenses.
The general partners believe that the leases will continue to generate cash flow
in excess of operating expenses.

         The general partners have the right, but not the obligation, to make
additional capital contributions if they deem it appropriate in connection with
the operations of the Partnership.

         The Partnership generally distributes cash from operations remaining
after the payment of operating expenses of the Partnership, to the extent that
the general partners determine that such funds are available for distribution.
Based on current and anticipated future cash from operations, and for the nine
months ended September 30, 1998, net sales proceeds from the sale of the
Properties in Fort Myers, Florida and Union Township, Ohio, the Partnership
declared distributions to limited partners of $1,800,000 and $3,033,748 for the
nine months ended September 30, 1999 and 1998, respectively ($600,000 for each
of the quarters ended September 30, 1999 and 1998). This represents
distributions of $30.00 and $50.56 per unit for the nine months ended September
30, 1999 and 1998, respectively ($10.00 per unit for each of the quarters ended
September 30, 1999 and 1998). Distributions for the nine months ended September
30, 1998 included $1,233,748 as a result of the distribution of net sales
proceeds from the 1998 sale of the Properties in Ft. Myers, Florida and Union
Township, Ohio. No distributions were made to the general partners for the
quarters and nine months ended September 30, 1999 and 1998. No amounts
distributed to the limited partners for the nine months ended September 30, 1999
and 1998 are required to be or have been treated by the Partnership as a return
of capital for purposes of calculating the limited partners' return on their
adjusted capital contributions. The Partnership intends to continue to make
distributions of cash available for distribution to the limited partners on a
quarterly basis.

         Total liabilities of the Partnership, including distributions payable,
increased to $1,087,009 at September 30, 1999 from $849,833 at December 31,
1998, primarily as a result of the Partnership accruing transaction costs
relating to the proposed merger with CNL American Properties Fund, Inc. ("APF"),
as described below an increase in amounts due to related parties, and an
increase in rents paid in advance and deposits at September 30, 1999, as
compared to December 31, 1998. Total liabilities at September 30, 1999, to the
extent they exceed cash and cash equivalents at September 30, 1999, will be paid
from future cash from operations, and in the event the general partners elect to
make additional contributions, from general partners' contributions.

Long-Term Liquidity
-------------------

         The Partnership has no long-term debt or other long-term liquidity
requirements.

                                       9
<PAGE>

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

         During the nine months ended September 30, 1998, the Partnership owned
and leased 34 wholly owned Properties (which included four Properties, which
were sold during 1998) and during the nine months ended September 30, 1999, the
Partnership owned and leased 30 wholly owned Properties, generally to operators
of fast-food and family-style restaurant chains. During the nine months ended
September 30, 1999 and 1998, the Partnership earned $1,601,882 and $1,694,465,
respectively, in rental income from operating leases and earned income from the
direct financing leases from these Properties, $546,499 and $579,483 of which
was earned during the quarters ended September 30, 1999 and 1998, respectively.
The decrease in rental and earned income for the quarter and nine months ended
September 30, 1999 was primarily due to the sale of the Properties in Fort
Myers, Florida and Union Township, Ohio in March 1998, and the sale of the
Property in Naples, Florida in September 1998. During the nine months ended
September 30, 1999, the Partnership used the net sales proceeds from the sale of
the Property in Naples, Florida to acquire a Property in Zephyrhills, Florida,
as tenants-in-common with CNL Income Fund XVII, Ltd., an affiliate of the
general partners. Rental and earned income are expected to remain at reduced
amounts as a result of distributing the net sales proceeds from the 1998 sales
of the Properties in Fort Myers, Florida and Union Township, Ohio to the limited
partners during 1998.

         In addition, rental and earned income during the quarter and nine
months ended September 30, 1999, was lower than during the quarter and nine
months ended September 30, 1998 because during the quarter and nine months ended
September 30, 1998 the Partnership collected and recognized as income a larger
amount of the past due rental amounts owed from the former tenant of the
Property located in Palm Bay, Florida, for which the Partnership had previously
established an allowance for doubtful accounts, than during the quarter and nine
months ended September 30, 1999. The former tenant vacated this Property in
October 1997 and the Partnership had been pursuing collection of the past due
rental amounts. The Partnership received the past due rental amounts from the
former tenant's guarantor in accordance with a settlement agreement between the
Partnership and the tenant's guarantor to collect some of the amounts due to the
Partnership from the former tenant of this Property. The decrease in rental and
earned income during the quarter and nine months ended September 30, 1999, was
partially offset by an increase in rental and earned income due to the fact that
in February 1998, the Partnership entered into a new lease with a new tenant for
this Property.

         For the nine months ended September 30, 1999 and 1998, the Partnership
also earned $65,059 and $37,207, respectively, in contingent rental income,
$30,685 of which was earned during the quarter ended September 30, 1999. The
increase in contingent rental income during the quarter and nine months ended
September 30, 1999, as compared to the quarter and nine months ended September
30, 1998, is primarily due to an increase in gross sales of certain restaurant
Properties, the leases of which require the payment of contingent rental income.

         In October 1998, the tenant of one Boston Market Property filed for
bankruptcy. As of November 5, 1999, the Partnership had continued receiving
rental payments relating to this lease. While the tenant has not rejected or
affirmed the lease, there can be no assurance that the lease will not be
rejected in the future. The lost revenues resulting from the rejection of this
lease could have an adverse effect on the results of operations of the
Partnership if the Partnership is not able to re-lease this Property in a timely
manner.

                                       10
<PAGE>

         During the nine months ended September 30, 1998, the Partnership also
owned and leased five Properties indirectly through joint venture arrangements
and one Property as tenants-in-common with affiliates of the general partners.
During the nine months ended September 30, 1999, the Partnership owned and
leased six Properties through joint venture arrangements and two Properties as
tenants-in-common with affiliates of the general partners. In connection
therewith, during the nine months ended September 30, 1999 and 1998, the
Partnership recognized income of $216,463 and a loss of $143,612, respectively,
of which income of $69,847 and $5,276 were recognized for the quarters ended
September 30, 1999 and 1998, respectively. The increase in net income earned by
joint ventures is primarily due to the fact that during the quarter and nine
months ended September 30, 1998, Kingsville Real Estate Joint Venture (in which
the Partnership owns a 68.87% interest in the profits and losses of the joint
venture) established an allowance for doubtful accounts of approximately $21,900
and $87,800, respectively, in accordance with its collection policy. No such
allowance was established during the quarter and nine months ended September 30,
1999. In addition, during the nine months ended September 30, 1998, Kingsville
Real Estate Joint Venture established a provision for loss on land and net
investment in the direct financing lease for its Property in Kingsville, Texas
for approximately $316,000. The allowance represented the difference between the
Property's carrying value at September 30, 1998 and the estimated net realizable
value of the Property. No such allowance was recorded during the quarter and
nine months ended September 30, 1999. In January 1999, Kingsville Real Estate
Joint Venture entered into a new lease for this Property with a new tenant and
the general partners ceased collection efforts on the past due amounts.

         The increase during the quarter and nine months ended September 30,
1999 in net income earned by joint ventures is also due to the fact that during
the quarter and nine months ended September 30, 1998, Titusville Joint Venture
(in which the Partnership owns a 26.60% interest) established an allowance for
loss on the land and building for its Property, of approximately $139,300, due
to the fact that in July 1997, the operator of the Property vacated the Property
and ceased operations. The allowance represented the difference between the
Property's net carrying value at September 30, 1998 and the estimated net
realizable value of the Property. No such allowance was recorded during the
quarter and nine months ended September 30, 1999. Titusville Joint Venture is
currently seeking either a replacement tenant or purchaser for this Property.

         The increase in net income earned by joint ventures for the quarter and
nine months ended September 30, 1999 is also partially due to the fact that in
September 1998 the Partnership reinvested net sales proceeds from the 1998 sale
of its Property in Leesburg, Florida in Warren Joint Venture. In addition, the
increase was also due to the fact that in January 1999, the Partnership
reinvested net sales proceeds from the 1998 sale of its Property in Naples,
Florida in a Property in Zephyrhills, Florida, as tenants-in-common with an
affiliate of the general partners.

         Operating expenses, including depreciation and amortization, were
$632,704 and $550,017 for the nine months ended September 30, 1999 and 1998,
respectively, of which $201,330 and $182,378 were incurred for the quarters
ended September 30, 1999 and 1998, respectively. The increase in operating
expenses for the quarter and nine months ended September 30, 1999, as compared
to the quarter and nine months ended September 30, 1998, was primarily due to
the fact that the Partnership incurred $52,300 and $156,466 for the quarter and
nine months ended September 30, 1999, respectively, in transaction costs related
to the general

                                       11
<PAGE>

partners retaining financial and legal advisors to assist them in evaluating and
negotiating the proposed Merger with APF, as described below. If the limited
partners reject the Merger, the Partnership will bear the portion of the
transaction costs based upon the percentage of "For" votes and the general
partners will bear the portion of such transaction costs based upon the
percentage of "Against" votes and abstentions. The increase in operating
expenses for the quarter and nine months ended September 30, 1999, as compared
to the quarter and nine months ended September 30, 1998, was partially offset by
a decrease in depreciation expense as a result of the sale of four Properties in
1998.

         The increase in operating expenses was partially offset by a decrease
due to the fact that the Partnership incurred certain expenses, such as real
estate taxes, insurance and maintenance during the quarter and nine months ended
September 30, 1998 as a result of the former tenant of the Property in Leesburg,
Florida defaulting under the terms of its lease. The Partnership sold this
Property in July 1998, as described above, therefore the Partnership did not
incur such expenses subsequent to July 1998.

         As a result of the sales of the Properties in Fort Myers, Florida,
Union Township, Ohio, and Leesburg, Florida the Partnership recognized a gain of
$55,743 for financial reporting purposes during the nine months ended September
30, 1998. In addition, during the quarter and nine months ended September 30,
1998, the Partnership recognized a gain of $170,281 for financial reporting
purposes as a result of the sale of its Property in Naples, Florida. No
Properties were sold during the quarter and nine months ended September 30,
1999.

Proposed Merger
---------------

         On March 11, 1999, the Partnership entered into an Agreement and Plan
of Merger with APF, pursuant to which the Partnership would be merged with and
into a subsidiary of APF (the "Merger"). As consideration for the Merger, APF
has agreed to issue 1,334,008 shares of its common stock, par value $0.01 per
share (the "APF Shares"). In order to assist the general partners in evaluating
the proposed merger consideration, the general partners retained Valuation
Associates, a nationally recognized real estate appraisal firm, to appraise the
Partnership's restaurant property portfolio. Based on Valuation Associates'
appraisal, the fair value of the Partnership's property portfolio and other
assets was $26,259,630 as of December 31, 1998. The APF Shares are expected to
be listed for trading on the New York Stock Exchange concurrently with the
consummation of the Merger, and therefore, would be freely tradable at the
option of the former limited partners. At a special meeting of the partners that
is expected to be held in the first quarter of 2000, limited partners holding in
excess of 50% of the Partnership's outstanding limited partnership interests
must approve the Merger prior to consummation of the transaction. If the limited
partners at the special meeting approve the Merger, APF will own the Properties
and other assets of the Partnership. The general partners intend to recommend
that the limited partners of the Partnership approve the Merger. In connection
with their recommendation, the general partners will solicit the consent of the
limited partners at the special meeting. If the limited partners reject the
Merger, the Partnership will bear the portion of the transaction costs based
upon the percentage of "For" votes and the general partners will bear the
portion of such transaction costs based upon the percentage of "Against" votes
and abstentions.

         On May 11, 1999, four limited partners in several of the CNL Income
Funds served a lawsuit against the general partners and APF in connection with
the proposed Merger. On July

                                       12
<PAGE>

8, 1999, the plaintiffs amended the complaint to add three additional limited
partners as plaintiffs. Additionally, on June 22, 1999, a limited partner in
certain of the CNL Income Funds served a lawsuit against the general partners,
APF, CNL Fund Advisors, Inc. and certain of its affiliates in connection with
the proposed Merger. On September 23, 1999, the judge assigned to the two
lawsuits entered an order consolidating the two cases. Pursuant to this order,
the plaintiffs in these cases filed a consolidated and amended complaint on
November 8, 1999. The various defendants, including the general partners, have
45 days to respond to that consolidated complaint. The general partners and APF
believe that the lawsuits are without merit and intend to defend vigorously
against the claims. See Part II - Item 1. Legal Proceedings.

Year 2000 Readiness Disclosure
------------------------------

Overview of Year 2000 Problem

         The year 2000 problem concerns the inability of information and
non-information technology systems to properly recognize and process date
sensitive information beyond January 1, 2000. The failure to accurately
recognize the year 2000 could result in a variety of problems from data
miscalculations to the failure of entire systems.

Information and Non-Information Technology Systems

         The Partnership does not have any information or non-information
technology systems. The general partners and their affiliates provide all
services requiring the use of information and non-information technology systems
pursuant to a management agreement with the Partnership. The information
technology system of the general partners' affiliates consists of a network of
personal computers and servers built using hardware and software from mainstream
suppliers. The non-information technology systems of the affiliates are
primarily facility related and include building security systems, elevators,
fire suppressions, HVAC, electrical systems and other utilities. The affiliates
have no internally generated programmed software coding to correct, because
substantially all of the software utilized by the affiliates is purchased or
licensed from external providers. The maintenance of non-information technology
systems at the Partnership's restaurant properties is the responsibility of the
tenants of such properties in accordance with the terms of the Partnership's
leases.

The Y2K Team

         In early 1998, the general partners and their affiliates formed a Year
2000 committee (the "Y2K Team") for the purpose of identifying, understanding
and addressing the various issues associated with the year 2000 problem. The Y2K
Team consists of the general partners and members from their affiliates,
including representatives from senior management, information systems,
telecommunications, legal, office management, accounting and property
management.

Assessing Year 2000 Readiness

         The Y2K Team's initial step in assessing year 2000 readiness consisted
of identifying any systems that are date-sensitive and, accordingly, could have
potential year 2000 problems. The Y2K Team has conducted inspections, interviews
and tests to identify which of the systems used by the Partnership could have a
potential year 2000 problem.

                                       13
<PAGE>

         The information system of the general partners' affiliates is comprised
of hardware and software applications from mainstream suppliers. Accordingly,
the Y2K Team has contacted and is evaluating documentation from the respective
vendors and manufacturers to verify the year 2000 compliance of their products.
The Y2K Team has also requested and is evaluating documentation from the
non-information technology systems providers of the affiliates.

         In addition, the Y2K Team has requested and is evaluating documentation
from other companies with which the Partnership has material third party
relationships. Such third parties, in addition to the providers of information
and non-information technology systems, consist of the Partnership's transfer
agent and financial institutions. The Partnership depends on its transfer agent
to maintain and track investor information and its financial institutions for
availability of cash.

         As of September 30, 1999, the Y2K Team had received responses from
approximately 62 percent of the third parties. All of the responses were in
writing. Of the third parties responding, all indicated that they are currently
year 2000 compliant or will be year 2000 compliant prior to the year 2000.
Although the Y2K Team continues to receive positive responses from the companies
with which the Partnership has third party relationships regarding their year
2000 compliance, the general partners cannot be assured that the third parties
have adequately considered the impact of the year 2000.

         In addition, the Y2K Team has requested documentation from the
Partnership's tenants. As of September 30, 1999, the Y2K Team had received
responses from approximately 50 percent of the tenants. All of the responses
were in writing. Of the tenant's responding, all indicated that they are
currently year 2000 compliant or will be year 2000 compliant prior to the year
2000. The general partners cannot be assured that the tenants have adequately
considered the impact of the year 2000. The Partnership has also instituted a
policy of requiring any new tenants to indicate that their systems are year 2000
compliant or are expected to be year 2000 compliant prior to the year 2000.

Achieving Year 2000 Compliance

         The Y2K Team has identified and completed upgrades for its hardware
equipment that was not year 2000 compliant. In addition, the Y2K Team has
identified and completed upgrades of the software applications that were not
year 2000 compliant, although the general partners cannot be assured that the
upgrade solutions provided by the vendors have addressed all possible year 2000
issues.

The cost for these upgrades and other remedial measures is the responsibility of
the general partners and their affiliates. The general partners do not expect
that the Partnership will incur any costs in connection with year 2000 remedial
measures.

Assessing the Risks to the Partnership of Non-Compliance and Developing
Contingency Plans

Risk of Failure of Information and Non-Information Technology Systems Used by
the Partnership

                                       14
<PAGE>

The general partners believe that the reasonably likely worst case scenario with
regard to the information and non-information technology systems used by the
Partnership is the failure of one or more of these systems as a result of year
2000 problems. Because the Partnership's major source of income is rental
payments under long-term triple-net leases, any failure of information or
non-information technology systems used by the Partnership is not expected to
have a material impact on the results of operations of the Partnership. Even if
such systems failed, the payment of rent under the Partnership's leases would
not be affected. In addition, the Y2K Team is expected to correct any Y2K
problems within the control of the general partners and their affiliates before
the year 2000.

         The Y2K Team has determined that a contingency plan to address this
risk is not necessary at this time. However, if the Y2K Team identifies
additional risks associated with the year 2000 compliance of the information or
non-information technology systems used by the Partnership, the Y2K Team will
develop a contingency plan if deemed necessary at that time.

Risk of Inability of Transfer Agent to Accurately Maintain Partnership Records

         The general partners believe that the reasonably likely worst case
scenario with regard to the Partnership's transfer agent is that the transfer
agent will fail to achieve year 2000 compliance of its systems and will not be
able to accurately maintain the records of the Partnership. This could result in
the inability of the Partnership to accurately identify its limited partners for
purposes of distributions, delivery of disclosure materials and transfer of
units. The Y2K Team has received certification from the Partnership's transfer
agent of its year 2000 compliance. Despite the positive response from the
transfer agent, the general partners cannot be assured that the transfer agent
has addressed all possible year 2000 issues.

         The Y2K Team has developed a contingency plan pursuant to which the
general partners and their affiliates would maintain the records of the
Partnership manually, in the event that the systems of the transfer agent are
not year 2000 compliant. The general partners and their affiliates would have to
allocate resources to internally perform the functions of the transfer agent.
The general partners do not anticipate that the additional cost of these
resources would have a material impact on the results of operations of the
Partnership.

Risk of Loss of Short-Term Liquidity from Failure of Financial Institutions to
Achieve Year 2000 Compliance

         The general partners believe that the reasonably likely worst case
scenario with regard to the Partnership's financial institutions is that some or
all of its funds on deposit with such financial institutions may be temporarily
unavailable. The Y2K Team has received responses from 93% of the Partnership's
financial institutions indicating that their systems are currently year 2000
compliant or are expected to be year 2000 compliant prior to the year 2000.
Despite the positive responses from the financial institutions, the general
partners cannot be assured that the financial institutions have addressed all
possible year 2000 issues. The loss of short-term liquidity could affect the
Partnership's ability to pay its expenses on a current basis. The general
partners do not anticipate that a loss of short-term liquidity would have a
material impact on the results of operations of the Partnership.

                                       15
<PAGE>

         Based upon the responses received from the Partnership's financial
institutions and the inability of the Y2K Team to identify a suitable
alternative for the deposit of funds that is not subject to potential year 2000
problems, the Y2K Team has determined not to develop a contingency plan to
address this risk.

Risks of Late Payment or Non-Payment of Rent by Tenants

         The general partners believe that the reasonably likely worst case
scenario with regard to the Partnership's tenants is that some of the tenants
may make rental payments late as the result of the failure of the tenants to
achieve year 2000 compliance of their systems used in the payment of rent, the
failure of the tenant's financial institutions to achieve year 2000 compliance,
or the temporary disruption of the tenants' businesses. The Y2K Team is in the
process of requesting responses from the Partnership's tenants indicating the
extent to which their systems are currently year 2000 compliant or are expected
to be year 2000 compliant prior to the year 2000. The general partners cannot be
assured that the tenants have addressed all possible year 2000 issues. The late
payment of rent by one or more tenants would affect the results of operations of
the Partnership in the short-term.

         The general partners are also aware of predictions that the year 2000
problem, if uncorrected, may result in a global economic crisis. The general
partners are not able to determine if such predictions are true. A widespread
disruption of the economy could affect the ability of the Partnership's tenants
to pay rent and, accordingly, could have a material impact on the results of
operations of the Partnership.

         Because payment of rent is under the control of the Partnership's
tenants, the Y2K Team is not able to develop a contingency plan to address these
risks. In the event of late payment or non-payment of rent, the general partners
will assess the remedies available to the Partnership under its lease
agreements.

ITEM 3.     QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

      Not applicable.

                                       16
<PAGE>

                           PART II. OTHER INFORMATION



Item 1.       Legal Proceedings.
              -----------------

              On May 11, 1999, four limited partners in several CNL Income Funds
              served a derivative and purported class action lawsuit filed April
              22, 1999 against the general partners and APF in the Circuit Court
              of the Ninth Judicial Circuit of Orange County, Florida, alleging
              that the general partners breached their fiduciary duties and
              violated provisions of certain of the CNL Income Fund partnership
              agreements in connection with the proposed Merger. The plaintiffs
              are seeking unspecified damages and equitable relief. On July 8,
              1999, the plaintiffs filed an amended complaint which, in addition
              to naming three additional plaintiffs, includes allegations of
              aiding and abetting and conspiring to breach fiduciary duties,
              negligence and breach of duty of good faith against certain of the
              defendants and seeks additional equitable relief. As amended, the
              caption of the case is Jon Hale, Mary J. Hewitt, Charles A.
                                     -------------------------------------
              Hewitt, Gretchen M. Hewitt Bernard J. Schulte, Edward M. and
              ------------------------------------------------------------
              Margaret Berol Trust, and Vicky Berol v. James M. Seneff, Jr.,
              --------------------------------------------------------------
              Robert A. Bourne, CNL Realty Corporation, and CNL American
              ----------------------------------------------------------
              Properties Fund, Inc., Case No. CIO-99-0003561.
              ----------------------

              On June 22, 1999, a limited partner of several CNL Income Funds
              served a purported class action lawsuit filed April 29, 1999
              against the general partners and APF, Ira Gaines, individually and
                                                    ----------------------------
              on behalf of a class of persons similarly situated, v. CNL
              ----------------------------------------------------------
              American Properties Fund, Inc., James M. Seneff, Jr., Robert A.
              ---------------------------------------------------------------
              Bourne, CNL Realty Corporation, CNL Fund Advisors, Inc., CNL
              ------------------------------------------------------------
              Financial Corporation a/k/a CNL Financial Corp., CNL Financial
              --------------------------------------------------------------
              Services, Inc. and CNL Group, Inc., Case NO. CIO-99-3796, in the
              -----------------------------------
              Circuit Court of the Ninth Judicial Circuit of Orange County,
              Florida, alleging that the general partners breached their
              fiduciary duties and that APF aided and abetted their breach of
              fiduciary duties in connection with the proposed Merger. The
              plaintiff is seeking unspecified damages and equitable relief.

              On September 23, 1999, Judge Lawrence Kirkwood entered an order
              consolidating the two cases under the caption In re: CNL Income
                                                            -----------------
              Funds Litigation, Case No. 99-3561. Pursuant to this order, the
              -----------------------------------
              plaintiffs in these cases filed a consolidated and amended
              complaint on November 8, 1999, and the various defendants,
              including the general partners, have 45 days to respond to that
              consolidated complaint.

Item 2.       Changes in Securities.  Inapplicable.
              ---------------------

Item 3.       Defaults upon Senior Securities.  Inapplicable.
              -------------------------------

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

Item 5.       Other Information.  Inapplicable.
              -----------------

                                       17
<PAGE>

Item 6.       Exhibits and Reports on Form 8-K.
              --------------------------------

              (a) Exhibits

                  2.1      Agreement and Plan of Merger by and between the
                           Registrant and CNL American Properties Fund, Inc.
                           ("APF") dated March 11, 1999, as amended June 4,
                           1999, and as amended October 27, 1999 (Filed as
                           Appendix B to the Prospectus Supplement for the
                           Registrant, constituting a part of Amendment No. 3 to
                           the Registration Statement of APF on Form S-4, File
                           No. 333-74329.)

                  4.1      Certificate of Limited Partnership of CNL Income Fund
                           IV, Ltd. (Included as Exhibit 3.1 in Amendment No. 1
                           to Registration Statement No. 33-20249 on Form S-11
                           and incorporated herein by reference.)

                  4.2      Amended and Restated Agreement and Certificate of
                           Limited Partnership of CNL Income Fund IV, Ltd.
                           (Included as Exhibit 3.2 to Form 10-K filed with the
                           Securities and Exchange Commission on March 31, 1994,
                           and incorporated herein by reference.)

                  4.1      Certificate of Limited Partnership of CNL Income Fund
                           IV, Ltd. (Included as Exhibit 3.1 in Amendment No. 1
                           to Registration Statement No. 33-20249 on Form S-11
                           and incorporated herein by reference.)

                  4.2      Amended and Restated Agreement and Certificate of
                           Limited Partnership of CNL Income Fund IV, Ltd.
                           (Included as Exhibit 3.2 to Form 10-K filed with the
                           Securities and Exchange Commission on March 31, 1994,
                           and incorporated herein by reference.)

                  10.1     Property Management Agreement (Included as Exhibit
                           10.1 to Form 10-K filed with the Securities and
                           Exchange Commission on March 31, 1994, and
                           incorporated herein by reference.)

                  10.2     Assignment of Property Management Agreement from CNL
                           Investment Company to CNL Income Fund Advisors, Inc.
                           (Included as Exhibit 10.2 to Form 10-K filed with the
                           Securities and Exchange Commission on March 30, 1995,
                           and incorporated herein by reference.)

                  10.3     Assignment of Property Management Agreement from CNL
                           Income Fund Advisors, Inc. to CNL Fund Advisors, Inc.
                           (Included as Exhibit 10.3 to Form 10-K filed with the
                           Securities and Exchange Commission on April 1, 1996,
                           and incorporated herein by reference.)

                  27       Financial Data Schedule (Filed herewith.)

                                       18
<PAGE>

              (b) Reports on Form 10-K

                  No reports on Form 8-K were filed during the quarter ended
                  September 30, 1999.

                                       19
<PAGE>

                                   SIGNATURES
                                   ----------


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

                  DATED this 10th day of November, 1999.


                                          CNL INCOME FUND IV, LTD.

                                          By: CNL REALTY CORPORATION
                                              General Partner


                                              By:  /s/ James M. Seneff, Jr.
                                                   -----------------------------
                                                   JAMES M. SENEFF, JR.
                                                   Chief Executive Officer
                                                   (Principal Executive Officer)


                                              By:  /s/ Robert A. Bourne
                                                   -----------------------------
                                                   ROBERT A. BOURNE
                                                   President and Treasurer
                                                   (Principal Financial and
                                                   Accounting Officer)

                                       20