# AMERICAN TRUST INVESTMENT SERVICES, INC. X-17A-5 (2023-03-31) — Broker-dealer annual report - Company: AMERICAN TRUST INVESTMENT SERVICES, INC. - Form: X-17A-5 - Filed: 2023-03-31 - Period: 2022-12-31 - Accession: 0000076964-23-000002 - CIK: 76964 - File #: 8-14394 - Type: Broker-dealer - Material weakness: No - Auditor: JESSER, RAVID, JASON, BASSO AND FARBER, LLP - Auditor location: CHICAGO, IL - Contact: Michael Grady - Phone: 6304359128 - Email: m.grady@amtruinvest.com - Website: amtruinvest.com - Signed by: Michael Grady (CFO) Original filing: https://www.sec.gov/Archives/edgar/data/76964/000007696423000002/ATISPublic2022.pdf --- {0}------------------------------------------------ #### CONSOLIDATED STATEMENT OF FINANCIAL CONDITION AND REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM DECEMBER 31, 2022 {1}------------------------------------------------ #### STATEMENT OF FINANCIAL CONDITION AND REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM #### DECEMBER 31, 2022 #### C O N T E N T S | AMERICAN TRUST INVESTMENT SERVICES, INC | | |-------------------------------------------------------------------------------------------------|------| | STATEMENT OF FINANCIAL CONDITION AND
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM | | | DECEMBER 31, 2022 | | | C O N T E N T S | | | | Page | | Facing Page | 1 | | Oath or Affirmation | 2 | | Report of Independent Registered Public Accounting Firm on
Statement of Financial Condition | 3 | | Statement of Financial Condition | 4 | | Notes to Statement of Financial Condition | 5-10 | | | | | | | {2}------------------------------------------------ #### UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 OMB APPROVAL OMB Number: 3235-0123 Expires: Oct. 31, 2023 Estimated average burden hours per response: 12 SEC FILE NUMBER 8-14394 #### ANNUAL REPORTS FORM X-17A-5 PART III FACING PAGE Information Required Pursuant to Rules 17a-5, 17a-12, and 18a-7 under the Securities Exchange Act of 1934 | FILING FOR THE PERIOD BEGINNING 01/01/2022 | | | |--------------------------------------------|----------|----------| | | MM/DD/YY | MM/DD/YY | A. REGISTRANT IDENTIFICATION ## NAME OF FIRM: AMERICAN TRUST INVESTMENT SERVICES INC TYPE OF REGISTRANT (check all applicable boxes): @ Broker-dealer | | O Security-based swap dealer | | | Major security-based swap participant Check here if respondent is also an OTC derivatives dealer ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use a P.O. box no.) ### 1244 119TH STREET | (No. and Street) | | | |----------------------------------------------------------------------------------------------------------|------------------------------|----------------------------------------------------------------------------| | INDIANA | | 46394 | | (State) | | (Zip Code) | | PERSON TO CONTACT WITH REGARD TO THIS FILING | | | | MICHAEL GRADY 630-435-9128 | | m.grady@amtruinvest.com | | (Area Code - Telephone Number) | (Email Address) | | | | | | | | | | | JESSER, RAVID, JASON, BASSO AND FARBER, LLP | | | | (Name - If individual, state last, first, and middle name)
CHICAGO
150 N. WACKER DRIVE, SUITE 3100 | - | 60606 | | (City) | (State) | (Zip Code) | | NOVEMBER 5, 2003 | 851 | | | | B. ACCOUNTANT IDENTIFICATION | INDEPENDENT PUBLIC ACCOUNTANT whose reports are contained in this filing * | \* Claims for exemption from the requirement that the annual reports of an independent public. accountant must be supported by a statement of facts and circumstances relied on as the basis of the exemption. See 17 CFR 240.17a-5(e)(1)(ii), if applicable. Persons who are to respond to the collection of information contained in this form are not required to respond unless the form displays a currently valid OMB control number. {3}------------------------------------------------ #### OATH OR AFFIRMATION 1. MICHAEL GRADY swear (or affirm) that, to the best of my knowledge and belief, the financial report pertaining to the firm of AMERICAN TRUST INVESTMENT SERVICES INC as of 2022\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ 12/31 partner, officer, director, or equivalent person, as the case may be, has any proprietary interest in any account classified solely ![](_page_3_Picture_5.jpeg) Signature: Title: Notary Public #### This filing \*\* contains (check all applicable boxes): - (a) Statement of financial condition. - = (b) Notes to consolidated statement of financial condition. - O (c) Statement of income (loss) or, if there is other comprehensive income in the period(s) presented, a statement of comprehensive income (as defined in § 210.1-02 of Regulation S-X), - (d) Statement of cash flows. - [ (e) Statement of changes in stockholders' or partners' or sole proprietor's equity. - [] (f) Statement of changes in liabilities subordinated to claims of creditors. - [ {g) Notes to consolidated financial statements. - [ {h) Computation of net capital under 17 CFR 240.15c3-1 or 17 CFR 240.18a-1, as applicable. - [i) Computation of tangible net worth under 17 CFR 240.18a-2. - [] Computation for determination of customer reserve requirements pursuant to Exhibit A to 17 CFR 240.15c3-3. - | (k) Computation for determination of security-based swap reserve reguirements pursuant to Exhibit B to 17 CFR 240.15c3-3 or Exhibit A to 17 CFR 240.18a-4, as applicable. - [ [ (I) Computation for Determination of PAB Requirements under Exhibit A to § 240.15c3-3. - [ (m) Information relating to possession or control requirements for customers under 17 CFR 240.15c3-3. - [] {n} Information relating to possession or control requirements for security-based swap customers under 17 CFR 240.15c3-3(p)(2) or 17 CFR 240.18a-4, as applicable. - [] (o) Reconciliations, including appropriate explanations, of the FOCUS Report with computation of tangible net worth under 17 CFR 240.15c3-1, 17 CFR 240.18a-1, or 17 CFR 240.18a-2, as applicable, and the reserve requirements under 17 CFR 240.15c3-3 or 17 CFR 240.18a-4, as applicable, if material differences exist, or a statement that no material differences exist. - [p) Summary of financial data for subsidiaries not consolidated in the statement of financial condition. - [q] Qath or affirmation in accordance with 17 CFR 240.17a-5, 17 CFR 240.17a-12, or 17 CFR 240.18a-7, as applicable. - [ (r) Compliance report in accordance with 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable. - [s) Exemption report in accordance with 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable. - (t) Independent public accountant's report based on an examination of the statement of financial condition, - [ {u} Independent public accountant's report based on an examination of the financial report or financial statements under 17 CFR 240.17a-5, 17 CFR 240.18a-7, or 17 CFR 240.17a-12, as applicable. - [ (v) Independent public accountant's report based on an examination of certain statements in the compliance report under. 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable. - [iv] Independent public accountant's report based on a review of the exemption report under 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable. - [ (x) Supplemental reports on applying agreed upon procedures, in accordance with 17 CFR 240.17a-2, as applicable. - [] (y) Report describing any material inadequacies found to have existed since the date of the previous audit, or a statement that no material inadequacies exist, under 17 CFR 240.17a-12(k). - (z) Other: - \*\* To request confidential treatment of certain portions of this filing, see 17 CFR 240.170-5(e)(3) or 17 CFR 240.180-7(d)(2), os applicable. {4}------------------------------------------------ ![](_page_4_Picture_0.jpeg) #### REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM ON STATEMENT OF FINANCIAL CONDITION To the Shareholder of American Trust Investment Services, Inc. Whiting, IN #### Opinion on the Financial Statement We have audited the accompanying statement of financial condition of American Trust Investment Services, Inc. as of December 31, 2022, and the related notes (collectively referred to as the financial statement). In our opinion, the financial statement presents fairly, in all material respects, the financial position of American Trust Investment Services, Inc. as of December 31, 2022 in conformity with accounting principles generally accepted in the United States of America. #### Basis for Opinion This financial statement is the responsibility of American Trust Investment Services, Inc.s management. Our responsibility is to express an opinion on American Trust Investment Services, Inc.s financial statement based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to American Trust Investment Services, Inc. in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statement is free of material misstatement, whether due to error or fraud. Our audit included performing procedures to assess the risks of material misstatement of the financial statement, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statement. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statement. We believe that our audit provides a reasonable basis for our opinion. We have served as American Trust Investment Services, Inc.s auditor since 2022. Chicago, IL March 30, 2023 {5}------------------------------------------------ #### STATEMENT OF FINANCIAL CONDITION #### DECEMBER 31, 2022 #### ASSETS | AMERICAN TRUST INVESTMENT SERVICES, INC. | | |----------------------------------------------------------------------------------------------------------------------------|--------------------| | STATEMENT OF FINANCIAL CONDITION | | | DECEMBER 31, 2022 | | | ASSETS | | | Cash | \$
686,319 | | Receivable from clearing broker/dealers
Brokerage account money market positions
Furniture, equipment, and leasehold | 800,898
426,077 | | improvements, at cost, net of
\$23,366 accumulated depreciation | -0- | | Right of Use assets, net | 111,978 | | Prepaid taxes | 14,232 | | Other assets | 10,291 | | TOTAL ASSETS | \$ 2,049,795 | | LIABILITIES AND SHAREHOLDER'S EQUITY | | | LIABILITIES | | | Accounts payable and accrued expenses | \$
639,956 | | Commissions payable | 985,979 | | Operating lease liability | 111,978 | | Total Liabilities | \$ 1,737,913 | | SHAREHOLDER'S EQUITY | | | Common stock, no par value, 100 shares | | | authorized, issued and outstanding | \$
45,000 | | Additional paid in capital | 63,800 | | Retained earnings | 203,082 | | Total Shareholder's Equity | \$
311,882 | | TOTAL LIABILITIES AND SHAREHOLDER'S EQUITY | \$ 2,049,795 | The accompanying notes are an integral part of this financial statement. {6}------------------------------------------------ #### NOTES TO STATEMENT OF FINANCIAL CONDITION #### NOTE 1 - ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES Organization - American Trust Investment Services, Inc. (the Company) was incorporated in the state of Indiana on December 23, 1968 as Peerson & Company, Inc. CCIG Acquisition Company, LLC closed on the purchase of the Company from Amtru, Inc. on May 15, 2012. The Company is registered with the Securities and Exchange Commission and is a member of the Financial Industry Regulatory Authority (FINRA). The Company's principal business activity is the sale of securities. Basis of Presentation The financial statement has been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP). Securities Transactions - Securities transactions of the Company are recorded on a trade date basis, which is the same business day as the transaction date. Depreciation Depreciation of fixed assets was provided for using the straightline method over five years. Concentrations of Credit Risk - The Company is engaged in various trading and brokerage activities in which the counterparties primarily include broker/dealers, banks, other financial institutions and the Companys own customers. In the event the counterparties do not fulfill their obligations, the Company may be exposed to risk. The risk of default depends on the creditworthiness of the counterparty or issuer of the instrument. It is the Companys policy to review, as necessary, the credit standing of each counter party. In addition, the Companys cash is on deposit at three financial institutions but uses one primarily for its operations and the balance at times may exceed the federally insured limit. The Company believes it is not exposed to any significant credit risk to cash. . {7}------------------------------------------------ #### NOTES TO STATEMENT OF FINANCIAL CONDITION # NOTE 1 ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES - (Continued) Estimates - The preparation of financial statements in conformity with GAAP 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. Actual results could differ from those estimates. Subsequent Events - The Company evaluated all significant events or transactions that occurred through the audit report date, the date these financial statements were available to be issued. #### NOTE 2 INCOME TAXES The Corporation is a C Corporation for income tax purposes. The credit for income taxes reported in the statement of income for 2022 includes an adjustment of prior estimated taxes to actual. In accordance with U.S. GAAP, the Company is required to determine whether its tax positions are more likely than not to be sustained upon examination by the applicable taxing authority, based on the technical merits of the position. Generally, the Company is no longer subject to income tax examinations by major taxing authorities for the years before 2019. Based on its analysis, there were no tax positions identified by management which did not meet the "more likely than not" standard as of and for the year ended December 31, 2022. #### NOTE 3 - FAIR VALUE MEASUREMENT . FASB ASC 820 defines fair value, creates a framework for measuring fair value, and establishes a fair value hierarchy which prioritizes the inputs to valuation techniques. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A fair value measurement assumes that the transaction to sell the asset or transfer the liability occurs in the principal market for the asset or liability or, in the absence of a principal market, the most advantageous market. Valuation techniques that are consistent with the market, income or cost approach, as specified by FASB ASC 820, are used to measure fair value. {8}------------------------------------------------ #### NOTES TO STATEMENT OF FINANCIAL CONDITION #### NOTE 3 - FAIR VALUE MEASUREMENT - (Continued) The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three broad levels: - Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities the Company has the ability to access. - Level 2 inputs are inputs (other than quoted prices included within level 1) that are observable for the asset or liability, either directly or indirectly. - Level 3 inputs are unobservable inputs for the asset or liability and rely on managements own assumptions about the assumptions that market participants would use in pricing the asset or liability. The Companys financial assets that are reported at fair value in the accompanying statement of financial condition as of December 31, 2022 are as follows: | Securities | Level 1
\$ 426,077 | Level 2
\$
- | Level 3
\$
- | Total
\$426,077 | |----------------------------|-----------------------|--------------------|--------------------|--------------------| | Total assets at fair value | \$ 426,077 | \$
- | \$
- | \$426,077 | #### NOTE 4 - NET CAPITAL REQUIREMENTS . As a registered broker/dealer and member of the Financial Industry Regulatory Authority, the Company is subject to the Uniform Net Capital Rule (rule 15c3- 1), which requires the maintenance of minimum net capital and requires that the ratio of aggregate indebtedness to net capital, both as defined, shall not exceed 1500%. On December 31, 2022, the Company's net capital and required net capital were \$277,892 and \$108,396 respectively. The ratio of aggregate indebtedness to net capital was 585.10%. {9}------------------------------------------------ #### NOTES TO STATEMENT OF FINANCIAL CONDITION #### NOTE 5 - LEASE COMMITMENTS . The Company leases two office spaces, on a month-to-month basis, for a total amount of \$5,200 per month. \$3,500 a month is paid to an LLC that manages the finance office which is controlled by two of the officers of the Company. It is the opinion of the officers that it could attain similar rent if rented by another company. The rent was not negotiated by a third party and therefore there has been no secondary check as to whether the Company is paying more for rent than they would elsewhere. The scheduled lease payments for the year ended December 31, 2022 totaled \$62,400 which has been paid. See Note 9. #### NOTE 6 - CLEARING AGREEMENT WITH OFF-BALANCE-SHEET RISK In order to facilitate securities transactions, there is a secondary clearing agreement (Tri-Party agreement) among LaSalle St. Securities, L.L.C. (Primary Correspondent), the Company (Secondary Correspondent), and National Financial Services, LLC. The new Clearing Broker/dealer (NFS) has accepted the introduction of brokerage accounts of Secondary Correspondent through Primary Correspondent and to provide to such accounts the Clearing Services provided to the other accounts introduced to NFS by Primary Correspondent pursuant to the Clearing Agreement. The Secondary Correspondent is willing to indemnify, defend, and hold harmless Primary Correspondent and NFS for losses incurred by Primary Correspondent or NFS, respectively, in connection with all accounts introduced by Secondary Correspondent to NFS through Primary Correspondent. The Secondary Correspondent is not required to have a deposit with the Primary Correspondent or NFS. The Company may therefore be exposed to offbalance-sheet risk in the event the customer is unable to fulfill its contracted obligations and it is necessary for the Primary Correspondent or NFS to purchase or sell the securities at a loss. The Companys exposure to risk would consist of the amount of the loss realized and any additional expenses incurred pertaining to the transaction or other customer activity. The Company added a second clearing arrangement on a Fully Disclosed basis with RBC correspondent sources. They have provided the clearing firm with a \$50,000.00 security deposit. The Company may therefore be exposed to offbalance-sheet risk in the event the customer is unable to fulfill its contracted obligations and it is necessary for the Primary Correspondent or RBC to purchase or sell the securities at a loss. The Companys exposure to risk would consist of the amount of the loss realized and any additional expenses incurred. {10}------------------------------------------------ #### NOTES TO STATEMENT OF FINANCIAL CONDITION #### NOTE 7 - AFFILIATED TRANSACTIONS The Company currently uses an affiliate to act as a Professional Employment Organization (PEO) to provide payroll and consulting fees on behalf of the Company. Other Affiliates of the Company also use the same PEO. The Company also splits the cost of the E and O Insurance with affiliates of the Company. See Note 5. #### NOTE 8 CONTIGENT LIABILITES The Company may be involved in a number of legal and regulatory proceedings concerning matters arising from the normal conduct of the Company's business activities. Although there can be no assurances as to the ultimate outcome, the Company has generally denied, or believes it has a meritorious defense, and will deny, liability in all significant litigation pending against the Company, and it intends to defend vigorously each case. Based upon information currently available and advice of counsel the Company believes that the eventual outcome of such matters will not, individually or in the aggregate, have a material adverse effect on the Company's financial position or results of operation. #### NOTE 9 OPERATING LEASE . The Company recognizes and measures its leases in accordance with FASB ASC 842, Leases. The Company is a lessee in operating leases for office space as described below. The Company recognizes a lease liability and the right of use (ROU) asset at the commencement date of the lease. The lease liability is initially and subsequently recognized based on the present value of its future lease payments. The implicit interest rate of the Companys leases is not readily determinable, and accordingly, management has used a riskfree rate of return. The ROU asset is initially recorded at the same amount as the lease liability, and subsequently amortized and charged to lease expense on a straight-line basis over the lease term. {11}------------------------------------------------ #### NOTES TO STATEMENT OF FINANCIAL CONDITION #### NOTE 9 OPERATING LEASE - (continued) The Company has elected to not recognize ROU assets and lease liabilities for short-term leases that have a lease term of 12 months or less at lease commencement and do not include an option to purchase the underlying asset that the Company is reasonably certain to exercise. The Company recognizes lease expense associated with its short-term leases on a straight-line basis over the lease term. The Company conducts its operations from office facilities under a three-year noncancelable lease expiring in September 2025 at a minimum monthly rate of \$3,500. Right of use assets under the above lease consist of the following: | Right of use assets | \$ 118,134 | | |--------------------------------|------------|--| | Less: Accumulated amortization | (6,156) | | | Net | \$ 111,978 | | Lease liabilities consist of the following: | Undiscounted cash payments | \$ 119,000 | | |----------------------------|------------|--| | Less: Discount (4.48%) | (7,022) | | | | \$ 111,978 | | For the year ended December 31, 2022, operating lease expense for the Companys capitalized operating leases was \$7,000. For the year ended December 31, 2022, rent and lease expenses under the Companys leases, including its short-term leases, totaled \$37,912 and long-term liabilities totaled \$74,066. As of December 31, 2022, the weighted-average remaining lease term for operating leases was 2.83 years. The Companys minimum future annual rentals under the above leases are as follows: | 2023 | \$ 42,000 | | |------|------------|--| | 2024 | 42,000 | | | 2025 | 35,000 | | | | \$ 119,000 | | . Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.