# JEFFERIES LLC X-17A-5 (2024-01-26) — Broker-dealer annual report

- Company: JEFFERIES LLC
- Form: X-17A-5
- Filed: 2024-01-26
- Period: 2023-11-30
- Accession: 0000200403-24-000002
- CIK: 200403
- File #: 8-15074
- Type: Broker-dealer
- Material weakness: No
- Auditor: Deloitte & Touche LLP
- Auditor location: New York, NY
- Contact: Kevin Galvin
- Phone: 2127076304
- Email: mlarson@jefferies.com
- Website: jefferies.com
- Signed by: Matt Larson (Chief Financial Officer)

Original filing: https://www.sec.gov/Archives/edgar/data/200403/000020040324000002/jeffllc2023public3.pdf

---

{0}------------------------------------------------

#### JEFFERIES LLC

#### (SEC I.D. No. 8-15074)

## CONSOLIDATED STATEMENT OF FINANCIAL CONDITION AS OF NOVEMBER 30, 2023 AND SUPPLEMENTAL SCHEDULES AND INDEPENDENT AUDITORS' REPORT AND SUPPLEMENTAL REPORT ON INTERNAL CONTROL \*\*\*\*\*\*

Filed pursuant to Rule 17a-5(e)(3) under the Securities Exchange Act of 1934 and Regulation 1.10(g) under the Commodity Exchange Act as a Public Document.

{1}------------------------------------------------

## UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549

OMB APPROVAL OMB Number:......... 3235-0123 Expires:........... November 30, 2026 Estimated average burden hours per response: ..................... 12

# ANNUAL REPORTS FORM X-17A-5 PART III

8-15074

SEC FILE NUMBER

FACING PAGE

Information Required Pursuant to Rules 17a-5, 17a-12, and 18a-7 under the Securities Exchange Act of 1934

| TRANT IDENTIBIC                    |           |               |            |  |  |  |  |  |  |
|------------------------------------|-----------|---------------|------------|--|--|--|--|--|--|
|                                    | MM/DD/YY  |               | MM/DD/YY   |  |  |  |  |  |  |
| FILING FOR THE PERIOD<br>BEGINNING | 12/1/2022 | AND<br>ENDING | 11/30/2023 |  |  |  |  |  |  |

#### NAME OF FIRM: Jefferies LLC

TYPE OF REGISTRANT (check all applicable boxes):

Z Broker-dealer □ Check here if respondent is also an OTC derivatives dealer

[ Security-based swap dealer

# ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use a P.O. box no.)

520 Madison Avenue

|                                                  | (No. and Street)                                                          |                                            |            |  |  |  |
|--------------------------------------------------|---------------------------------------------------------------------------|--------------------------------------------|------------|--|--|--|
| New York                                         | New York                                                                  |                                            | 10022      |  |  |  |
| (City)                                           | (State)                                                                   | (Zip Code)                                 |            |  |  |  |
|                                                  | PERSON TO CONTACT WITH REGARD TO THIS FILING                              |                                            |            |  |  |  |
| Matt Larson                                      | mlarson@jefferies.com                                                     |                                            |            |  |  |  |
| (Name)                                           | (Area Code - Telephone Number)                                            | (Email Address)                            |            |  |  |  |
|                                                  | B.ACCOUNTANT IDENTIFICATION                                               |                                            |            |  |  |  |
|                                                  | INDEPENDENT PUBLIC ACCOUNTANT whose reports are contained in this filing* |                                            |            |  |  |  |
| Deloitte & Touche LLP                            |                                                                           |                                            |            |  |  |  |
|                                                  | (Name - if individual, state last, first, and middle name)                |                                            |            |  |  |  |
| 30 Rockefeller Plaza                             | New York                                                                  | New York                                   | 10112      |  |  |  |
| (Address)                                        | (City)                                                                    | (State)                                    | (Zip Code) |  |  |  |
| 10/20/2003                                       |                                                                           | # 34                                       |            |  |  |  |
| (Date of Registration with PCAOB)(if applicable) |                                                                           | (PCAOB Registration Number, if applicable) |            |  |  |  |
|                                                  | FOR OFFICIAL USE ONLY                                                     |                                            |            |  |  |  |

\* Claims for exemption from the requirement that the annual reports be covered by the 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 17CFR 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.

This report is deemed CONFIDENTIAL in accordance with Rule 17a-5e(3) under the Securities Exchange Act of 1934 and Regulation 1.1(g) under the Commodity Exchange Act.

{2}------------------------------------------------

#### AFFIRMATION

I, Matt Larson, affirm that, to the best of my knowledge and belief, the accompanying consolidated financial statements and supplemental schedules pertaining to Jefferies LLC as of and for the year ended November 30, 2023 , are trne and correct. I fmiher affirm that neither the Company nor any officer or director has any proprietary interest in an cou • t classified solely as that of a customer.

Title:

Chief Financial Officer

Notary Public

Catherine L. Caldeira NOTARY PUBLIC, STATE OF NEW YORK Registration No. 0 I CA627785 I Qualified in Kings County Commission Expires August 8, 2025 \

{3}------------------------------------------------

#### **'56?3686:40;:@.6:?-05207.88.<<860./82/;D2?**

- -5 CBGC@=85H98GH5H9A9BHC::=B5B7=5@7CB8=H=CB
- -6 )CH9GHCGH5H9A9BHC::=B5B7=5@7CB8=H=CB
- 7 CBGC@=85H98GH5H9A9BHC:7CADF9<9BG=J9=B7CA9
- 8 CBGC@=85H98GH5H9A9BHC:75G<:@CKG
- 9 CBGC@=85H98GH5H9A9BHC:7<5B;9G=BA9A69FUG9EI=HM
- : CBGC@=85H98GH5H9A9BHC:7<5B;9G=B@=56=@=H=9GGI6CF8=B5H98HC7@5=AGC:;9B9F5@7F98=HCFG
- ; )CH9GHC7CBGC@=85H98:=B5B7=5@GH5H9A9BHG
- < 0B7CBGC@=85H987CADIH5H=CBC:B9H75D=H5@IB89F"-7
CF"-5
5G5DD@=756@9
- = CADIH5H=CBC:H5B;=6@9B9HKCFH<IB89F"-5
- > 0B7CBGC@=85H987CADIH5H=CB:CF89H9FA=B5H=CBC:7IGHCA9FF9G9FJ9F9EI=F9A9BHGDIFGI5BHHC!L<=6=HHC"-7
- ? CADIH5H=CB:CF89H9FA=B5H=CBC:G97IF=HM
65G98GK5DF9G9FJ9F9EI=F9A9BHGDIFGI5BHHC!L<=6=HHC"-7
CF!L<=6=HHC "-5
5G5DD@=756@9
- @ 0B7CBGC@=85H987CADIH5H=CB:CF89H9FA=B5H=CBC:+-9EI=F9A9BHGIB89F!L<=6=HHCO7
- A 0B7CBGC@=85H98=B:CFA5H=CBF9@5H=B;HCDCGG9GG=CBCF7CBHFC@F9EI=F9A9BHG:CF7IGHCA9FGIB89F"-7
- B %B:CFA5H=CBF9@5H=B;HCDCGG9GG=CBCF7CBHFC@F9EI=F9A9BHG:CFG97IF=HM
65G98GK5D7IGHCA9FGIB89F"-7
D CF"- 5
5G5DD@=756@9
- C -97CB7=@=5H=CBG=B7@I8=B;5DDFCDF=5H99LD@5B5H=CBGC:H<9"\*0.-9DCFHK=H<7CADIH5H=CBC:B9H75D=H5@CFH5B;=6@9B9HKCFH<IB89F "-7
"-5
CF"-5
5G5DD@=756@95B8H<9F9G9FJ9F9EI=F9A9BHGIB89F"-7
CF"- 5
5G5DD@=756@9=:A5H9F=5@8=::9F9B79G9L=GHCF5GH5H9A9BHH<5HBCA5H9F=5@8=::9F9B79G9L=GH
- D .IAA5FMC::=B5B7=5@85H5:CFGI6G=8=5F=9GBCH7CBGC@=85H98=BH<9GH5H9A9BHC::=B5B7=5@7CB8=H=CB
- -E \*5H<CF5::=FA5H=CB=B577CF85B79K=H<"-5
"-5
CF"-5
5G5DD@=756@9
- F CAD@=5B79F9DCFH=B577CF85B79K=H<"-5
CF"-5
5G5DD@=756@9
- G !L9ADH=CBF9DCFH=B577CF85B79K=H<"-5
CF"-5
5G5DD@=756@9
- -H %B89D9B89BHDI6@=7577CIBH5BHUGF9DCFH65G98CB5B9L5A=B5H=CBC:H<9GH5H9A9BHC::=B5B7=5@7CB8=H=CB
- I %B89D9B89BHDI6@=7577CIBH5BHUGF9DCFH65G98CB5B9L5A=B5H=CBC:H<9:=B5B7=5@F9DCFHCF:=B5B7=5@GH5H9A9BHGIB89F"-5
 "-5
CF"-5
5G5DD@=756@9
- J %B89D9B89BHDI6@=7577CIBH5BHUGF9DCFH65G98CB5B9L5A=B5H=CBC:79FH5=BGH5H9A9BHG=BH<97CAD@=5B79F9DCFHIB89F"-5
CF "-5
5G5DD@=756@9
- K %B89D9B89BHDI6@=7577CIBH5BHUGF9DCFH65G98CB5F9J=9KC:H<99L9ADH=CBF9DCFHIB89F"-5
CF"-5
5G 5DD@=756@9
- L .IDD@9A9BH5@F9DCFHGCB5DD@M=B;5;F998
IDCBDFC798IF9G=B577CF85B79K=H<"-7
9CF"-5
5G5DD@=756@9
- - M -9DCFH89G7F=6=B;5BMA5H9F=5@=B589EI57=9G:CIB8HC9L=GHCF:CIB8HC<5J99L=GH98G=B79H<985H9C:H<9DF9J=CIG5I8=HCF5GH5H9A9BHH<5H BCA5H9F=5@=B589EI57=9G9L=GHIB89F"-5
?
- - N \*H<9F 0B7CBGC@=85H98GH5H9A9BHC:G9;F9;5H=CBF9EI=F9A9BHG5B8:IB8G=BG9;F9;5H=CB:CF7IGHCA9FGHF58=B;CB0.7CAAC8=HM 9L7<5B;9G
- - 55 \*H<9F 0B7CBGC@=85H98GH5H9A9BHC:G9;F9;5H=CBF9EI=F9A9BHG5B8:IB8G<9@8=BG9D5F5H9577CIBHG:CF:CF9=;B:IHIF9G5B8:CF9=;BCDH=CBG 7IGHCA9FGDIFGI5BHHC-9;I@5H=CB

 /CF9EI9GH7CB:=89BH=5@HF95HA9BHC:79FH5=BDCFH=CBGC:H<=G:=@=B;G99"-5
9 CF"-5
8 5G5DD@=756@9

{4}------------------------------------------------

# Deloitte.

**Deloitte & Touche LLP**  30 Rockefeller Plaza New York, NY 10012-0015 USA

Tel: 1 212 492 4000 Fax: 1 212 489 1687 www.deloitte.com

 

## REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Member of Jefferies LLC

## Opinion on the Financial Statement

We have audited the accompanying consolidated statement of financial condition of Jefferies LLC (the "Company") as of November 30, 2023, 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 the Company as of November 30, 2023, in conformity with accounting principles generally accepted in the United States of America.

## Basis for Opinion

The financial statement is the responsibility of the Company's management. Our responsibility is to express an opinion on this 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 the Company 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 of the financial statement provides a reasonable basis for our opinion.

## Report on Supplemental Schedules

The accompanying supplemental schedules of Unconsolidated Statement of Segregation Requirements and Funds in Segregation for Customers Trading on U.S. Commodity Exchanges and Unconsolidated Statement of Segregation Requirements and Funds Held in Separate Accounts for Foreign Futures and Foreign Options Customers Pursuant to Regulation 30.7 as of November 30, 2023, (collectively "the supplemental schedules") have been subjected to audit procedures performed in conjunction with the audit of the Company's statement of financial condition. The supplemental schedules are the responsibility of the Company's management. Our audit procedures included determining whether the supplemental schedules reconcile to the statement of financial condition or

{5}------------------------------------------------

the underlying accounting and other records, as applicable, and performing procedures to test the completeness and accuracy of the information presented in the supplemental schedules. In forming our opinion on the supplemental schedules, we evaluated whether the supplemental schedules, including their form and content, are presented in compliance with Rule 17a-5 under the Securities Exchange Act of 1934 and Regulation 1.10 under the Commodity Exchange Act. In our opinion, such schedules are fairly stated, in all material respects, in relation to the financial statements as a whole.

New York, New York

January 26, 2024

We have served as the Company's auditor since 2017.

{6}------------------------------------------------

## TBBIBRIBS DOC CONSOLIDATED STATEMENT OF FINANCIAL CONDITION AS OF NOVEMBER 30, 2023 (Dollars in thousands)

#### ASSETS Cash and cash equivalents .................................................................................................................................................... Cash and securities segregated and on deposit for regulatory purposes or deposited with clearing and depository organizations (includes \$110,198 of securities at fair value). 1,118,747 Financial instruments owned, at fair value, (includes securities pledged of \$8,795,555) ...................................................................................... 10,212,789 Securities borrowed .......................................................................................................................................................... 6,804,521 Securities purchased under agreements to resell .............................................................................................................................. 1,828,831 Securities received as collateral, at fair value.............................................................................................................................. 3,429 Receivables: Brokers, dealers and clearing organizations .................................................................................................................................. 482,033 Customers .................................................................................................................................................................... 1,704,648 Fees, interest and other ..................................................................................................................................................... 349,061 Due from affiliates .......................................................................................................................................................... 41,313 Premises and equipment, net .................................................................................................................................................. 649,904 Goodwill ..................................................................................................................................................................... 1,356,683 Other assets ................................................................................................................................................................. 680,811 Total assets. ................................................................................................................................................................

## LIABILITIES AND MEMBER'S EQUITY

| LIABILITIES:                                                                                            |            |
|---------------------------------------------------------------------------------------------------------|------------|
| Short-term borrowings                                                                                   |            |
| Financial instruments sold, not yet purchased, at fair value                                            |            |
| Securities loaned                                                                                       | 1,413,330  |
| Securities sold under agreements to repurchase                                                          | 7,172,356  |
| Other secured financings (includes \$3,898 at fair value and \$185,000 related to consolidated VIEs)  . | 188,898    |
| Obligation to return securities received as collateral, at fair value                                   | 3,429      |
| Payables:                                                                                               |            |
| Brokers, dealers and clearing organizations                                                             |            |
| Customers                                                                                               | 3,956,612  |
| Due to Parent and affiliates                                                                            | 731,220    |
| Lease liabilities                                                                                       | 308,531    |
| Accrued expenses and other liabilities (includes \$907 related to consolidated VIEs)                    |            |
| Total liabilities                                                                                       | 22,214,010 |
| Subordinated liabilities                                                                                | 3,550,000  |
| Member's equity                                                                                         | 2,394,835  |
| Total liabilities and member's equity                                                                   |            |
|                                                                                                         |            |

See accompanying notes to Consolidated Statement of Financial Condition.

{7}------------------------------------------------

#### NOTES TO CONSOLIDATED STATEMENT OF FINANCIAL CONDITION NOVEMBER 30, 2023

#### 1. ORGANIZATION AND BASIS OF PRESENTATION

Organization and Business - Jefferies LLC ("the Company") is a wholly owned subsidiary of Jefferies Financial Group Inc. ("Jefferies" or the "Parent"), a diversified holding company incorporated in the state of New York and engaged in a variety of businesses. The Company is registered with the Securities and Exchange Commission ("SEC") as a broker-dealer and is registered as a Futures Commission Merchant ("FCM") with the Commodity Futures Trading Commission ("CFTC"). The Company is a member of the Financial Industry Regulatory ("FINRA") and the National Futures Association ("NFA"). FINRA is the designated examining authority for the Company and the NFA is the designated selfregulatory organization for the Company as an FCM.

The Company operates as an institutional securities broker-dealer and FCM and is managed as a single reportable business segment, Investment Banking and Capital Markets. The Investment Banking and Capital Markets reportable business segment provides several types of financial services, including sales, trading, financing and market-making activities in equity, high yield, corporate bond, mortgage-backed and asset-backed, municipal, government and agency, convertible and international securities. The Investment Banking and Capital Markets reportable business segment also provides investment banking services comprised of securities underwriting and distribution and financial advisory services, including advice on mergers/acquisitions, recapitalizations/restructurings, as well as fundamental research and prime brokerage services. The Company also introduces certain customer accounts to a third-party broker-dealer.

Basis of Presentation - The accompanying Consolidated Statement of Financial Condition has been prepared in accordance with U.S. generally accepted accounting principles ("U.S. GAAP"). These principles require management to make a number of estimates and assumptions that may affect the amounts reported in the Consolidated Statement of Financial Condition and accompanying notes. The most important of these estimates and assumptions relate to fair value measurements, compensation and benefits and goodwill and intangible assets. Although these and other estimates and assumptions are based on the best available information, actual results could be materially different from these estimates.

Consolidation - The Company consolidates entities that meet the definition of a variable interest entity ("VIE") for which it is the primary beneficiary. The primary beneficiary is the party who has the power to direct the activities of a VIE that most significantly impact the entity's economic performance and who has an obligation to absorb losses of the entity, or a right to receive benefits from the entity that could potentially be significant to the entity. In situations where the Company has significant influence, but not control, of an entity that does not qualify as a VIE, it applies the equity method of accounting or fair value accounting pursuant to the fair value option election under U.S. GAAP. See Note 8, Variable Interest Entities for further discussion on VIEs.

All material intercompany accounts and transactions are eliminated in consolidation.

Subsequent Events - Management has evaluated events and transactions that occurred subsequent to November 30, 2023 through the date this Consolidated Statement of Financial Condition was issued. The Company determined that there were no events or transactions during such period requiring recognition or disclosure in the Consolidated Statement of Financial Condition.

{8}------------------------------------------------

#### NOTES TO CONSOLIDATED STATEMENT OF FINANCIAL CONDITION - CONTINUED NOVEMBER 30, 2023

## 2. SIGNIFICANT ACCOUNTING POLICIES

Cash Equivalents - Cash equivalents include highly liquid investments, including money market funds and certificates of deposit, not held for resale with original maturities of three months or less.

Cash and Securities Segregated and on Deposit for Regulatory Purposes or Deposited with Clearing and Depository Organizations - In accordance with Rule 15c3-3 of the Securities Exchange Act, the Company, as a broker-dealer carrying client accounts, is subject to requirements related to maintaining cash or qualified securities in a segregated reserve account for the exclusive benefit of its clients. In addition, certain exchange and/or clearing organizations require cash and/or securities to be deposited by the Company to conduct day to day activities.

Foreign Currency Translation - Assets and liabilities of the Company's foreign branch having a non-U.S. dollar functional currency are translated at exchange rates at the end of the year.

Financial Instruments and Fair Value - Financial instruments owned and Financial instruments sold, not yet purchased are recorded at fair value, either as required by accounting pronouncements or through the fair value option election. These instruments primarily represent the Company's trading activities and include both cash and derivative products. The fair value of a financial instrument is the amount 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 (the exit price).

Fair Value Hierarchy. In determining fair value, the Company maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability based on market data obtained from independent sources. Unobservable inputs reflect the assumptions that market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The Company applies a hierarchy to categorize its fair value measurements broken down into three levels based on the transparency of inputs as follows:

Level 1 - Quoted prices are available in active markets for identical assets or liabilities at the reported date. Valuation adjustments and block discounts are not applied to Level 1 instruments.

Level 2 - Pricing inputs other than quoted prices in active markets, which are either directly or indirectly observable at the reported date. The nature of these financial instruments include cash instruments for which quoted prices are available but traded less frequently, derivative instruments for which fair values have been derived using model inputs that are directly observable in the market, or can be derived principally from, or corroborated by, observable market data, and financial instruments that are fair valued by reference to other similar financial instruments, the parameters of which can be directly observed.

Level 3 - Instruments that have little to no pricing observability at the reported date. These financial instruments are measured using management's best estimate of fair value, where the inputs into the determination of fair value require significant management judgment or estimation.

Certain financial instruments have bid and ask prices that can be observed in the marketplace. For financial instruments whose inputs are based on bid-ask prices, the financial instrument is valued at the point within the bid-ask range that meets the Company's best estimate of fair value. The Company uses prices and inputs that are current at the measurement date. For financial instruments that do not have readily determinable fair values using quoted market prices, the determination of fair value is based on the best available information, taking into account the types of financial instruments, current financial information, restrictions (if any) on dispositions, fair values of underlying financial instruments and quotations for similar instruments.

{9}------------------------------------------------

#### **!"'&'""!&"'&'' !'"!!"!'"!"!'!( !") %**

/<9 J5@I5H=CB C: :=B5B7=5@ =BGHFIA9BHG A5M =B7@I89 H<9 IG9 C: J5@I5H=CB AC89@G 5B8 CH<9F H97<B=EI9G 8>IGHA9BHG HC J5@I5H=CBG 89F=J98 :FCA J5@I5H=CB AC89@G 5F9 D9FA=HH98 65G98 CB A5B5;9A9BHUG >I8;A9BHK<=7<H5?9G=BHC7CBG=89F5H=CBH<9:95HIF9GC:H<9:=B5B7=5@=BGHFIA9BHGI7<5G=HG7CAD@9L=HM H<9 A5F?9H =B K<=7< H<9 :=B5B7=5@ =BGHFIA9BH =G HF5898 5B8 IB89F@M=B; F=G? IB79FH5=BH=9G 56CIH A5F?9H 7CB8=H=CBG8>IGHA9BHG :FCAH<9DF=7989F=J98 :FCA5J5@I5H=CBAC89@ F9:@97HA5B5;9A9BHUG>I8;A9BH H<5HCH<9FD5FH=7=D5BHG=BH<9A5F?9H:CFH<9:=B5B7=5@=BGHFIA9BH69=B;A95GIF985H:5=FJ5@I9KCI@85@GC 7CBG=89F=B J5@I=B;H<5H G5A9 :=B5B7=5@=BGHFIA9BH /CH<9 9LH9BHH<5H J5@I5H=CB=G 65G98 CB AC89@G CF =BDIHG H<5H 5F9 @9GG C6G9FJ56@9 CF IBC6G9FJ56@9 =B H<9 A5F?9H H<9 89H9FA=B5H=CB C: :5=F J5@I9 F9EI=F9G ACF9>I8;A9BH

/<95J5=@56=@=HMC:C6G9FJ56@9=BDIHG75BJ5FM5B8=G5::97H986M5K=89J5F=9HMC::57HCFG=B7@I8=B;:CF 9L5AD@9H<9HMD9C::=B5B7=5@=BGHFIA9BH5B8A5F?9H7CB8=H=CBGGH<9C6G9FJ56=@=HMC:DF=79G5B8=BDIHG A5M7<5B;9 :CF5 :=B5B7=5@=BGHFIA9BH :FCA D9F=C8HC D9F=C8H<=G7CB8=H=CBA5M75IG95HF5BG:9F C:5B =BGHFIA9BH5ACB;H<9 :5=FJ5@I9<=9F5F7<M@9J9@G/<989;F99C:>I8;A9BH9L9F7=G98=B89H9FA=B=B; :5=F J5@I9=G;F95H9GH:CF=BGHFIA9BHG75H9;CF=N98K=H<=B'9J9@

**%2026B./82 3>;9 .:1 #.E./82 @; A?@;92>?**R -979=J56@9 :FCA 5B8 D5M56@9 HC 7IGHCA9FG =B7@I89G 5ACIBHG F979=J56@9 5B8 D5M56@9 CB 7IGHCA9FGU G97IF=HM 5B8 A5F;=B HF5BG57H=CBG .97IF=H=9G CKB98 6M 7IGHCA9FG5B8<9@85G7C@@5H9F5@ :CFH<9G9 F979=J56@9G5B85GA5F;=B :CFHF58=B;5F9BCH F9:@97H98=BH<9 CBGC@=85H98.H5H9A9BHC:"=B5B7=5@CB8=H=CB

**%2026B./823>;9.:1#.E./82@;>;72>?2.82>?.:182.>6:4">4.:6F.@6;:?**R-979=J56@9G:FCA 5B8D5M56@9GHC6FC?9FG895@9FG5B87@95F=B;CF;5B=N5H=CBG=B7@I8989DCG=HGC:75G<5B8CFG97IF=H=9GK=H< 9L7<5B;9 7@95F=B; CF;5B=N5H=CBG HC A99H A5F;=B F9EI=F9A9BHG 5ACIBHG 8I9 HC CF :FCA 7@95F=B; CF;5B=N5H=CBG :CF 85=@M J5F=5H=CB G9HH@9A9BHG G97IF=H=9G :5=@98
HC
89@=J9F CF F979=J9 F979=J56@9G 5B8 D5M56@9G :CF :99G 5B8 7CAA=GG=CBG 5B8 B9H F979=J56@9G CF D5M56@9G 5F=G=B; :FCA IBG9HH@98 G97IF=HM HF5BG57H=CBG

**>216@ ;??2? ;: 6:.:06.8 ??2@? 2.?A>21 .@ 9;>@6F21 ;?@** R "=B5B7=5@ 5GG9HG A95GIF98 5H 5ACFH=N987CGH5F9 DF9G9BH985HH<9 B9H5ACIBH9LD97H98HC 697C@@97H985B8H<9A95GIF9A9BH C:7F98=H @CGG9G5B85BM9LD97H98=B7F95G9G5B8897F95G9G=B9LD97H987F98=H@CGG9G5F9F97C;B=N98=B95FB=B;G/<9 9GH=A5H9C:9LD97H987F98=H@CGG9G=BJC@J9G>I8;A9BH5B8=G65G98CB5B5GG9GGA9BHCJ9FH<9@=:9C:H<9 :=B5B7=5@ =BGHFIA9BH H5?=B; =BHC 7CBG=89F5H=CB :CF975GHG C: 9LD97H98 :IHIF9 97CBCA=7 7CB8=H=CBG %B 9J5@I5H=B; G97IF98 :=B5B7=B; F979=J56@9G F9J9FG9 F9DIF7<5G9 5;F99A9BHG G97IF=H=9G 6CFFCK=B; 5FF5B;9A9BHG 5B8 A5F;=B @C5BG  H<9 IB89F@M=B; 7C@@5H9F5@ A5=BH9B5B79 DFCJ=G=CBG 5F9 H5?9B =BHC 7CBG=89F5H=CB/<9 IB89F@M=B; 7CBHF57HI5@ 7C@@5H9F5@A5=BH9B5B79 :CF G=;B=:=75BH@M 5@@ C:H<9CAD5BMUG G97IF98 :=B5B7=B; F979=J56@9G F9EI=F9G H<5H H<9 7CIBH9FD5FHM 7CBH=BI5@@M 58>IGH H<9 7C@@5H9F5@=N5H=CB 5ACIBH G97IF=B; H<9 7F98=H 9LDCGIF9 CB H<9G9 7CBHF57HG C@@5H9F5@=N5H=CB @9J9@G :CF H<9 CAD5BMUG G97IF98 :=B5B7=B; F979=J56@9G5F9=B=H=5@@M9GH56@=G<98 65G98 CBH<97CIBH9FD5FHMH<9HMD9 C:5779DH56@9 7C@@5H9F5@H<5H=GACB=HCF9885=@M5B858>IGH98HCA=H=;5H9H<9DCH9BH=5@C:5BM7F98=H@CGG9GF98=H@CGG9G 5F9BCHF97C;B=N98:CFG97IF98:=B5B7=B;F979=J56@9GK<9F9H<9IB89F@M=B;7C@@5H9F5@UG:5=FJ5@I9=G9EI5@ HCCF9L7998GH<95GG9HUG5ACFH=N987CGH65G=G%B75G9GK<9F9H<97C@@5H9F5@UG:5=FJ5@I98C9GBCH9EI5@H<9 CF 9L7998 H<9 5ACFH=N98 7CGH 65G=G H<9 5@@CK5B79 :CF 7F98=H @CGG9G =: 5BM =G @=A=H98 HC H<9 8=::9F9B79 69HK99BH<9:5=FJ5@I9C:H<97C@@5H9F5@5HH<9F9DCFH=B;85H95B8H<95ACFH=N987CGH65G=GC:H<9:=B5B7=5@ 5GG9HG

{10}------------------------------------------------

#### NOTES TO CONSOLIDATED STATEMENT OF FINANCIAL CONDITION - CONTINUED NOVEMBER 30, 2023

The Company's receivables from brokers, dealers, and clearing organizations include deposits of cash with exchange clearing organizations to meet margin requirements, amounts due from clearing organizations for daily variation settlements, securities failed-to-deliver or receive, receivables and payables for fees and commissions, and receivables arising from unsettled securities or loan transactions. These receivables generally do not give rise to material credit risk and have a remote probability of default either because of their short-term nature or due to the credit protection framework inherent in the design and operations of brokers, dealers and clearing organizations. As such, generally, no allowance for credit losses is held against these receivables.

For all other financial assets measured at amortized cost, the Company estimates expected credit losses over the financial assets' life as of the reporting date based on relevant information about past events, current conditions, and reasonable and supportable forecasts.

Securities Borrowed and Securities Loaned - Securities borrowed and securities loaned are carried at the amounts of cash collateral advanced and received in connection with the transactions and accounted for as collateralized financing transactions. In connection with both trading and brokerage activities, the Company borrows securities to cover short sales and to complete transactions in which customers have failed to deliver securities by the required settlement date, and lends securities to other brokers and dealers for similar purposes. The Company has an active securities borrowed and lending matched book business in which it borrows securities from one party and lends them to another party. When the Company borrows securities, it generally provides cash to the lender as collateral, which is reflected in the Consolidated Statement of Financial Condition as Securities borrowed. Similarly, when the Company lends securities to another party, that party provides cash to the Company as collateral, which is reflected in the Consolidated Statement of Financial Condition as Securities loaned. The initial collateral advanced or received approximates or is greater than the fair value of the securities borrowed or loaned. The Company monitors the fair value of the securities borrowed and loaned on a daily basis and requests additional collateral or returns excess collateral, as appropriate. In instances where the Company receives securities as collateral in connection with securities transactions in the which the Company is the lender of securities and is permitted to sell or repledge the securities received as collateral, the Company reports the fair value of the collateral received and the related obligation to return the collateral in the Company's Consolidated Statement of Financial Condition.

Securities Purchased Under Agreements to Resell and Securities Sold Under Agreements to Repurchase - Securities purchased under agreements to resell and Securities sold under agreements to repurchase (collectively "repos") are accounted for as collateralized financing transactions and are recorded at their contracted resale or repurchase amount plus accrued interest. Repos are presented in the Consolidated Statement of Financial Condition on a net basis by counterparty, where permitted by U.S. GAAP. The Company monitors the fair value of the underlying securities daily versus the related receivable or payable balances. Should the fair value of the underlying securities decline or increase, additional collateral is requested or excess collateral is returned, as appropriate.

Offsetting of Derivative Financial Instruments and Securities Financing Agreements - To manage the Company's exposure to credit risk associated with its derivative activities and securities financing transactions, the Company may enter into International Swaps and Derivative Association, Inc. ("ISDA") master netting agreements, master securities lending agreements, master repurchase agreements or similar agreements and collateral arrangements with counterparties. A master agreement creates a single contract under which all transactions between two counterparties are executed allowing for trade aggregation and a single net payment obligation. Master agreements provide protection in bankruptcy in certain circumstances and, where legally enforceable, enable receivables and payables with the same counterparty to be settled or otherwise eliminated by applying amounts due against all or a portion of an amount due from the counterparty or a third party.

{11}------------------------------------------------

#### **!"'&'""!&"'&'' !'"!!"!'"!"!'!( !") %**

0B89FH<9CAD5BMUG%. A5GH9FB9HH=B;5;F99A9BHG=HHMD=75@@M5@GC9L97IH9G7F98=HGIDDCFH5BB9L9G K<=7< DFCJ=89 :CF 7C@@5H9F5@ 9=H<9F =B H<9 :CFA C: 75G< CF G97IF=H=9G HC 69 DCGH98 6M CF D5=8 HC 5 7CIBH9FD5FHM 65G98 CB H<9 :5=F J5@I9 C: H<9 89F=J5H=J9 F979=J56@9 CF D5M56@9 65G98 CB H<9 F5H9G 5B8 D5F5A9H9FG9GH56@=G<98=BH<97F98=HGIDDCFH5BB9L

%B H<9 9J9BH C: H<9 7CIBH9FD5FHMUG 89:5I@H DFCJ=G=CBG C: H<9 A5GH9F 5;F99A9BH D9FA=H 5779@9F5H=CB 5B8 H9FA=B5H=CBC:5@@CIHGH5B8=B;HF5BG57H=CBG7CJ9F986MH<95;F99A9BHGI7<H<5H5G=B;@95ACIBH=GCK98 6MCFHCH<9BCB
89:5I@H=B;D5FHM%B588=H=CB5BM7C@@5H9F5@DCGH9875B695DD@=98HCH<9B9HC6@=;5H=CBG K=H<5BM9L79GGF9HIFB985B8H<97C@@5H9F5@=N98D5FHM<5G5F=;<HHC@=EI=85H9H<97C@@5H9F5@BMF9G=8I5@ 7@5=A5:H9FB9HH=B;=GHF95H985@CB;K=H<CH<9FIBG97IF987@5=AG=B65B?FIDH7M7CIFH

/<97CB8=H=CBGGIDDCFH=B;H<9@9;5@F=;<HC:C::G9HA5MJ5FM:FCACB9@9;5@>IF=G8=7H=CBHC5BCH<9F5B8H<9 9B:CF7956=@=HM C: A5GH9F B9HH=B; 5;F99A9BHG 5B8 65B?FIDH7M @5KG =B 79FH5=B 7CIBHF=9G CF =B 79FH5=B =B8IGHF=9G =G BCH :F99 :FCA 8CI6H /<9 F=;<H C: C::G9H =G 89D9B89BH 6CH< CB 7CBHF57H @5K IB89F H<9 ;CJ9FB=B; 5FF5B;9A9BH 5B8 7CBG=GH9B7M K=H< H<9 65B?FIDH7M @5KG C: H<9 >IF=G8=7H=CB K<9F9 H<9 7CIBH9FD5FHM =G @C75H98 %B8IGHFM @9;5@ CD=B=CBG K=H< F9GD97H HC H<9 9B:CF7956=@=HM C: 79FH5=B GH5B85F8 DFCJ=G=CBG=BF9GD97H=J9>IF=G8=7H=CBG5F9F9@=98IDCB5G5D5FHC:A5B5;=B;7F98=HF=G?%B75G9GK<9F9H<9 CAD5BM<5GBCH89H9FA=B985B5;F99A9BHHC699B:CF7956@9H<9F9@5H985ACIBHG5F9BCHC::G9H(5GH9F B9HH=B; 5;F99A9BHG 5F9 5 7F=H=75@ 7CADCB9BH C: H<9 CAD5BMUG F=G? A5B5;9A9BH DFC79GG9G 5G D5FH C: F98I7=B;7CIBH9FD5FHM7F98=HF=G?5B8A5B5;=B;@=EI=8=HMF=G?

/<9CAD5BM=G 5@GC 5 D5FHMHC 7@95F=B; 5;F99A9BHG K=H< J5F=CIG 79BHF5@ 7@95F=B; D5FH=9G 0B89FH<9G9 5FF5B;9A9BHGH<979BHF5@7@95F=B;7CIBH9FD5FHM:57=@=H5H9GG9HH@9A9BH69HK99B7CIBH9FD5FH=9G65G98CBH<9 B9HD5M56@9CK98CFF979=J56@98I95B8K=H<F9GD97HHC85=@MG9HH@9A9BH75G<=G;9B9F5@@MCB@MF9EI=F98 HC 69 89DCG=H98 HC H<9 9LH9BH C: H<9 B9H 5ACIBH %B H<9 9J9BH C: 89:5I@H 5 B9H H9FA=B5H=CB 5ACIBH =G 89H9FA=B98 65G98 CB H<9 A5F?9H J5@I9G C: 5@@ CIHGH5B8=B; DCG=H=CBG 5B8 H<9 7@95F=B; CF;5B=N5H=CB CF 7@95F=B; A9A69F DFCJ=89G :CF H<9 @=EI=85H=CB 5B8 G9HH@9A9BH C: H<9 B9H H9FA=B5H=CB 5ACIBH 5ACB; 5@@ 7CIBH9FD5FH=9GHCH<9CD9B7CBHF57HGCFHF5BG57H=CBG

-9:9F HC )CH9  9F=J5H=J9 "=B5B7=5@ %BGHFIA9BHG 5B8 )CH9  C@@5H9F5@=N98 /F5BG57H=CBG :CF :IFH<9F =B:CFA5H=CB

**#>296?2? .:1 =A6<92:@** R +F9A=G9G 5B8 9EI=DA9BH 5F9 89DF97=5H98 IG=B; H<9 GHF5=;<H
@=B9 A9H<C8 CJ9F H<9 9GH=A5H98 IG9:I@ @=J9G C: H<9 F9@5H98 5GG9HG ;9B9F5@@M H<F99 HC H9B M95FG '95G9<C@8 =ADFCJ9A9BHG 5F9 5ACFH=N98 IG=B; H<9 GHF5=;<H
@=B9 A9H<C8 CJ9F H<9 H9FA C: H<9 F9@5H98 @95G9G CF H<9 9GH=A5H98 IG9:I@ @=J9G C: H<9 5GG9HG K<=7<9J9F =G G<CFH9F +F9A=G9G 5B8 9EI=DA9BH =B7@I89G =BH9FB5@@M 89J9@CD98GC:HK5F9/<975FFM=B;J5@I9GC:=BH9FB5@@M89J9@CD98GC:HK5F9 F958M :CF=HG=BH9B898IG95F9 89DF97=5H98CJ9FH<9F9A5=B=B;IG9:I@@=:9

{12}------------------------------------------------

#### **!"'&'""!&"'&'' !'"!!"!'"!"!'!( !") %**

H )CJ9A69F   :IFB=HIF9 :=LHIF9G 5B8 9EI=DA9BH 5ACIBH98 HC A=@@=CB 5B8 @95G9<C@8 =ADFCJ9A9BHG 5ACIBH98 HC A=@@=CB 77IAI@5H98 89DF97=5H=CB 5B8 5ACFH=N5H=CB K5G A=@@=CB5H)CJ9A69F

**2.?2?**R"CF@95G9GK=H<5BCF=;=B5@H9FA@CB;9FH<5BCB9M95F@95G9@=56=@=H=9G5F9=B=H=5@@MF97C;B=N98 CBH<9@95G97CAA9B79A9BH85H965G98CBH<9DF9G9BHJ5@I9C:H<9:IHIF9A=B=AIA@95G9D5MA9BHGCJ9F H<9@95G9H9FA=B7@I8=B;BCB
@95G97CADCB9BHGGI7<5G:=L987CAACB5F95A5=BH9B5B797CGHG5B8CH<9F :=L98 7CGHG :CF ;9B9F5@@M 5@@@95G9G 7CFF9GDCB8=B; F=;<H
C:
IG9 S-\*0T 5GG9H=G=B=H=5@@M F97C;B=N98 9EI5@HCH<9@95G9@=56=@=HM58>IGH98:CF5BM@95G9DF9D5MA9BHG=B=H=5@8=F97H7CGHG5B8@95G9=B79BH=J9G/<9 -\*0 5GG9HG 5F9 =B7@I898 =B +F9A=G9G 5B8 9EI=DA9BH 5B8 H<9 @95G9 @=56=@=H=9G 5F9 =B7@I898 =B '95G9 @=56=@=H=9G=BH<9CBGC@=85H98.H5H9A9BHC:"=B5B7=5@CB8=H=CB

/<98=G7CIBHF5H9GIG98=B89H9FA=B=B;H<9DF9G9BHJ5@I9C:@95G9GF9DF9G9BHH<9CAD5BMUG7C@@5H9F5@=N98 6CFFCK=B;F5H97CBG=89F=B;957<@95G9UGH9FA5B87IFF9B7MC:D5MA9BH/<9@95G9H9FA=B7@I89GCDH=CBGHC 9LH9B8 CFH9FA=B5H9H<9@95G9K<9B=H=G F95GCB56@M 79FH5=BH<5HH<9CAD5BMK=@@ 9L9F7=G9H<5H CDH=CB 9FH5=B@95G9G<5J9F9B9K5@CDH=CBGH<5H75B699L9F7=G985HH<98=G7F9H=CBC:H<9CAD5BM

-9:9FHC)CH9'95G9G:CF:IFH<9F=B:CFA5H=CB

#### **;;1C688.:1:@.:46/82??2@?**

*\$\$,!!* R #CC8K=@@ F9DF9G9BHG H<9 9L79GG 57EI=G=H=CB 7CGH CJ9F H<9 :5=F J5@I9 C: B9H H5B;=6@9 5B8 =BH5B;=6@9 5GG9HG 57EI=F98 #CC8K=@@ =G BCH 5ACFH=N98 5B8 =G GI6>97H HC 5BBI5@ =AD5=FA9BH H9GH=B; CB I;IGHGHCF69HK99B5BBI5@H9GHG=:5B9J9BHCF7<5B;9=B7=F7IAGH5B79C77IFGH<5HKCI@8ACF9@=?9@M H<5B BCH F98I79 H<9 :5=F J5@I9 C: 5 F9DCFH=B; IB=H 69@CK =HG 75FFM=B; J5@I9 %B H9GH=B; :CF ;CC8K=@@ =AD5=FA9BH H<9 CAD5BM <5G H<9 CDH=CB HC :=FGH 5GG9GG EI5@=H5H=J9 :57HCFG HC 89H9FA=B9 K<9H<9F H<9 9L=GH9B79 C:9J9BHG CF7=F7IAGH5B79G@958HC5 89H9FA=B5H=CBH<5H=H=GACF9@=?9@MH<5B BCHH<5HH<9 :5=F J5@I9 C: 5 F9DCFH=B; IB=H =G @9GG H<5B =HG 75FFM=B; 5ACIBH %: 5:H9F 5GG9GG=B; H<9 HCH5@=HM C: 9J9BHG 5B8 7=F7IAGH5B79GH<9CAD5BM7CB7@I89GH<5H=H=GBCHACF9@=?9@MH<5BBCHH<5HH<9:5=FJ5@I9C:5F9DCFH=B; IB=H=G@9GGH<5B=HG75FFM=B;5ACIBHH<9BD9F:CFA=B;H<9;CC8K=@@=AD5=FA9BHH9GH=GBCHF9EI=F98%:=H=G 7CB7@I898 CH<9FK=G9 H<9 CAD5BM =G F9EI=F98 HC D9F:CFA H<9 ;CC8K=@@ =AD5=FA9BH H9GH /<9 ;CC8K=@@ =AD5=FA9BH H9GH =G D9F:CFA98 5H H<9 F9DCFH=B; IB=H @9J9@ 6M 7CAD5F=B; H<9 9GH=A5H98 :5=F J5@I9 C: 5 F9DCFH=B; IB=HK=H<=HG F9GD97H=J975FFM=B; J5@I9 %:H<99GH=A5H98 :5=F J5@I99L7998GH<975FFM=B; J5@I9 ;CC8K=@@5HH<9F9DCFH=B;IB=H@9J9@=GBCH=AD5=F98%:H<9:5=FJ5@I9=G@9GGH<5BH<975FFM=B;J5@I9H<9B5B =AD5=FA9BH@CGG=GF97C;B=N98:CFH<95ACIBH6MK<=7<H<975FFM=B;J5@I9C:H<9CAD5BMUG;CC8K=@@

/<9 :5=F J5@I9 C: 5 F9DCFH=B; IB=H=G 65G98 CB K=89@M 5779DH98 J5@I5H=CBH97<B=EI9GH<5HH<9 CAD5BM 69@=9J9GA5F?9HD5FH=7=D5BHGKCI@8IG95@H<CI;<H<9J5@I5H=CBDFC79GGF9EI=F9GG=;B=:=75BH>I8;A9BH5B8 C:H9B=BJC@J9GH<9IG9C:G=;B=:=75BH9GH=A5H9G5B85GGIADH=CBG/<9A9H<C8C@C;=9GH<9CAD5BMIH=@=N9G =B9GH=A5H=B;H<9:5=FJ5@I9C:5F9DCFH=B;IB=H=B7@I89GA5F?9HJ5@I5H=CBA9H<C8GH<5H=B7CFDCF5H9DF=79 HC
95FB=B;G 5B8 DF=79
HC
6CC? AI@H=D@9G C: 7CAD5F56@9 9L7<5B;9
HF5898 7CAD5B=9G 5B8 AI@H=D@9G C: A9F;9F 5B8 57EI=G=H=CBG C: G=A=@5F 6IG=B9GG9G /<9 9GH=A5H9G 5B8 5GGIADH=CBG IG98=B 89H9FA=B=B; :5=F J5@I9 7CI@8 <5J9 5 G=;B=:=75BH 9::97H CB K<9H<9F CF BCH 5B =AD5=FA9BH 7<5F;9 =G F97CF898 5B8 H<9 A5;B=HI89C: GI7<57<5F;98J9FG9A5F?9HCF97CBCA=79J9BHG7CI@8 F9GI@H=B=AD5=FA9BH7<5F;9G=B :IHIF9D9F=C8G

*#)#!(()(*R %BH5B;=6@95GG9HG 899A98HC <5J9 :=B=H9@=J9G5F95ACFH=N98CB5 GHF5=;<H@=B9 65G=G CJ9FH<9=F9GH=A5H98IG9:I@@=J9GK<9F9H<9IG9:I@@=:9=GH<9D9F=C8CJ9FK<=7<H<95GG9H=G9LD97H98HC 7CBHF=6IH98=F97H@MCF=B8=F97H@MHCH<9:IHIF975G<:@CKG%BH5B;=6@95GG9HG5F9F9J=9K98:CF=AD5=FA9BH CB 5B =BH9F=A 65G=G K<9B 79FH5=B 9J9BHG CF 7=F7IAGH5B79G 9L=GH "CF =BH5B;=6@9 5GG9HG 899A98 HC 69 =AD5=F985B=AD5=FA9BH@CGG=GF97C;B=N98:CFH<95ACIBH6MK<=7<H<9=BH5B;=6@95GG9HUG75FFM=B;J5@I9 9L7998G=HG:5=FJ5@I9H@95GH5BBI5@@MH<9F9A5=B=B;IG9:I@@=:9=G9J5@I5H98

{13}------------------------------------------------

#### **!"'&'""!&"'&'' !'"!!"!'"!"!'!( !") %**

B=BH5B;=6@95GG9HK=H<5B=B89:=B=H9IG9:I@@=:9=GBCH5ACFH=N986IH5GG9GG98:CF=AD5=FA9BH5BBI5@@MCF ACF9:F9EI9BH@MK<9B9J9BHGCF7<5B;9G=B7=F7IAGH5B79GC77IF=B8=75H=B;H<5H=H=GACF9@=?9@MH<5BBCH H<5HH<9=B89:=B=H9
@=J98 5GG9H=G=AD5=F98 %AD5=FA9BH 9L=GHGK<9BH<9 75FFM=B; 5ACIBH 9L7998G=HG :5=F J5@I9%BH9GH=B;:CF=AD5=FA9BHH<9CAD5BM<5GH<9CDH=CBHC:=FGHD9F:CFA5EI5@=H5H=J95GG9GGA9BHHC 89H9FA=B9K<9H<9F=H=GACF9@=?9@MH<5B BCHH<5H5B=AD5=FA9BH9L=GHG %:=H=G 89H9FA=B98H<5H=H=G BCH ACF9@=?9@MH<5B BCHH<5H 5B=AD5=FA9BH 9L=GHG 5 EI5BH=H5H=J9=AD5=FA9BHH9GH=G BCH B979GG5FM %:=H=G 7CB7@I898CH<9FK=G9H<9CAD5BM=GF9EI=F98HCD9F:CFA5EI5BH=H5H=J9=AD5=FA9BHH9GH

%BH5B;=6@95GG9HG5F9=B7@I898=B\*H<9F5GG9HG=BH<9CBGC@=85H98.H5H9A9BHC:"=B5B7=5@CB8=H=CB/<9 CAD5BMUG5BBI5@=B89:=B=H9
@=J98=BH5B;=6@95GG9H=AD5=FA9BHH9GH=B;85H9=GI;IGHGH/CH<99LH9BH5B =AD5=FA9BH@CGG=GF97C;B=N98H<9@CGG9GH56@=G<9GH<9B9K7CGH65G=GC:H<95GG9HH<5H=G5ACFH=N98CJ9F H<9F9A5=B=B;IG9:I@@=:9C:H<5H5GG9H=:5BM.I6G9EI9BHF9J9FG5@C:=AD5=FA9BH@CGG9G=GBCHD9FA=HH98

-9:9FHC)CH9#CC8K=@@5B8%BH5B;=6@9GG9HG:CF:IFH<9F=B:CFA5H=CB

**:0;92'.D2?**R/<9CAD5BM=G5 G=B;@9
A9A69F@=A=H98@=56=@=HM7CAD5BMHF95H985G5 8=GF9;5F898 9BH=HM:CF:989F5@5B8GH5H9=B7CA9H5LDIFDCG9G/<9CAD5BMUGF9GI@HGC:CD9F5H=CBG5F9=B7@I898=BH<9 7CBGC@=85H98"989F5@5B85DD@=756@9GH5H9=B7CA9H5LF9HIFBG:=@986MH<9+5F9BH

**24.8%2?2>B2?**R%BH<9BCFA5@7CIFG9C:6IG=B9GGH<9CAD5BM<5G699BB5A98:FCAH=A9HCH=A95G 5 89:9B85BH=B@9;5@ 5B8 F9;I@5HCFM DFC7998=B;G /<9CAD5BM=G 5@GC=BJC@J98 :FCAH=A9HCH=A9=B CH<9F 9L5AG =BJ9GH=;5H=CBG 5B8 G=A=@5F F9J=9KG 6CH< :CFA5@ 5B8 =B:CFA5@ 6M ;CJ9FBA9BH5@ 5B8 G9@: F9;I@5HCFM5;9B7=9GF9;5F8=B;=HG6IG=B9GG9G79FH5=BC:K<=7<A5MF9GI@H=B>I8;A9BHGG9HH@9A9BHG:=B9G D9B5@H=9GCFCH<9F=B>IB7H=CBG

/<9CAD5BMF97C;B=N9G5@=56=@=HM:CF57CBH=B;9B7M=B77FI989LD9BG9G5B8CH<9F@=56=@=H=9GK<9B=H=G DFC656@9 H<5H 5 @=56=@=HM <5G 699B =B7IFF98 5B8 H<9 5ACIBH C: @CGG 75B 69 F95GCB56@M 9GH=A5H98 %: H<9 F95GCB56@99GH=A5H9C:5DFC656@9@CGG=G5 F5B;9H<9CAD5BM577FI9GH<9ACGH@=?9@M5ACIBHC:GI7< @CGG5B8=:GI7<5ACIBH=GBCH89H9FA=B56@9H<9BH<9CAD5BM577FI9GH<9A=B=AIA=BH<9F5B;95GH<9 @CGG 577FI5@/<9 89H9FA=B5H=CB C:H<9 CIH7CA9 5B8@CGG 9GH=A5H9G F9EI=F9G G=;B=:=75BH>I8;A9BH CBH<9 D5FHC:A5B5;9A9BH/<9CAD5BM69@=9J9GH<5H5BMCH<9FA5HH9FG:CFK<=7<=H<5G89H9FA=B985@CGGHC 69 DFC656@9 5B8 F95GCB56@M 9GH=A56@9 5F9 BCH A5H9F=5@ HC H<9 CBGC@=85H98 .H5H9A9BH C: "=B5B7=5@ CB8=H=CB

%B A5BM =BGH5B79G =H =G BCH DCGG=6@9 HC 89H9FA=B9 K<9H<9F 5BM@CGG =G DFC656@9 CF 9J9B DCGG=6@9 CF HC 9GH=A5H9 H<9 5ACIBH C: 5BM @CGG CF H<9 G=N9 C: 5BM F5B;9 C: @CGG (5B5;9A9BH 69@=9J9G H<5H =B H<9 5;;F9;5H9 H<9 D9B8=B; @9;5@ 57H=CBG CF F9;I@5HCFM DFC7998=B;G 5B8 5BM CH<9F 9L5AG =BJ9GH=;5H=CBG CF G=A=@5FF9J=9KG6CH<:CFA5@5B8=B:CFA5@ G<CI@8BCH<5J95A5H9F=5@58J9FG99::97HCBH<9CBGC@=85H98 .H5H9A9BHC:"=B5B7=5@CB8=H=CB%B588=H=CBA5B5;9A9BH69@=9J9GH<5H5BM5ACIBHC:DCH9BH=5@@CGGCF F5B;9 C: DCH9BH=5@@CGG=B9L79GG C:K<5H <5G 699B DFCJ=898=BH<9CBGC@=85H98.H5H9A9BH C:"=B5B7=5@ CB8=H=CBH<5H7CI@869F95GCB56@M9GH=A5H98=GBCHA5H9F=5@

**&20A>6@6F.@6;:0@6B6@62?**R/<9CAD5BM9B;5;9G=BG97IF=H=N5H=CB57H=J=H=9GF9@5H98HCACFH;5;9
657?98 5B8CH<9F5GG9H
657?98G97IF=H=9G/F5BG:9FGC::=B5B7=5@5GG9HGHCG97IF98:IB8=B;J9<=7@9G5F9577CIBH98 :CF5GG5@9GK<9BH<9CAD5BM<5G F9@=BEI=G<987CBHFC@CJ9FH<9HF5BG:9FF985GG9HG/<9CAD5BMA5M F9H5=B =BH9F9GHG =B H<9 G97IF=H=N98 :=B5B7=5@ 5GG9HG 5G CB9 CF ACF9 HF5B7<9G C: H<9 G97IF=H=N5H=CB /<9G9 F9H5=B98=BH9F9GHG5F9=B7@I898=B"=B5B7=5@=BGHFIA9BHGCKB98=BH<9CBGC@=85H98.H5H9A9BHC:"=B5B7=5@ CB8=H=CB5H:5=FJ5@I9

2<9B5HF5BG:9FC:5GG9HG8C9GBCHA99HH<97F=H9F=5C:5G5@9H<9CAD5BM577CIBHG:CFH<9HF5BG:9F5G5 G97IF986CFFCK=B;5B87CBH=BI9GHCF97C;B=N9H<95GG9HGC:5G97IF986CFFCK=B;=B"=B5B7=5@=BGHFIA9BHG CKB985B8F97C;B=N9GH<95GGC7=5H98:=B5B7=B;=B\*H<9FG97IF98:=B5B7=B;G=BH<9CBGC@=85H98.H5H9A9BH C:"=B5B7=5@CB8=H=CB

{14}------------------------------------------------

## TEREBERTES DEC

#### NOTES TO CONSOLIDATED STATEMENT OF FINANCIAL CONDITION - CONTINUED NOVEMBER 30, 2023

#### Recent Accounting Developments

#### Accounting Standards to be Adopted in Future Periods

Segment Reporting. In November 2023, the Financial Accounting Standards Board ("FASB") issued ASU No. 2023-07 ("ASU 2023-07"), Improvements to Reportable Segment Disclosures. The guidance primarily will require enhanced disclosures about significant segment expenses. The amendments in ASU 2023-07 are effective for fiscal years beginning after December 15, 2023, with early adoption permitted, and are to be applied on a retrospective basis. The Company is evaluating the impact of the standard on its segment reporting disclosures.

#### 3. CASH AND CASH EQUIVALENTS

Financial assets classified as cash and cash equivalents that are deemed by the Company's management to be generally readily convertible into cash at November 30, 2023 are as follows (in thousands):

| Cash in banks                                                               | 621,074   |
|-----------------------------------------------------------------------------|-----------|
| Money market investments                                                    | 2,305,001 |
| Total cash and cash equivalents                                             | 2,926,075 |
| Total cash and securities segregated (1)<br>Less: segregated securities (2) | (110,198) |
| Total cash and cash equivalents segregated                                  |           |

(1) Includes deposits of \$655.8 million that are segregated in accordance with the SEC Rule 15c3-3, which subjects the Company as a broker-dealer carrying customer accounts to requirements related to maintaining cash or qualified securities in a segregated reserve account for the exclusive benefit of its customers.

(2) Consists of U.S. Treasury securities and are not considered cash equivalents.

{15}------------------------------------------------

#### **!"'&'""!&"'&'' !'"!!"!'"!"!'!( !") %**

#### **%)(&"&(%&**

/<9:C@@CK=B;=G5GIAA5FMC:H<9CAD5BMUG:=B5B7=5@5GG9HG5B8@=56=@=H=9GH<5H5F9577CIBH98:CF5H:5=F J5@I9CB5F97IFF=B;65G=G9L7@I8=B;%BJ9GHA9BHG5H:5=FJ5@I965G98CBB9H5GG9HJ5@I9S)1T C: A=@@=CB5H)CJ9A69F6M@9J9@K=H<=BH<9:5=FJ5@I9<=9F5F7<M=BH<CIG5B8G 

|                                                                                                                |  | '9J9@ |  | '9J9@ |  | '9J9@ |  | CIBH9FD5FHM5B8<br>5G<C@@5H9F5@<br>)9HH=B; | /CH5@ |  |
|----------------------------------------------------------------------------------------------------------------|--|-------|--|-------|--|-------|--|-------------------------------------------|-------|--|
| ??2@?                                                                                                          |  |       |  |       |  |       |  |                                           |       |  |
| "=B5B7=5@=BGHFIA9BHGCKB98                                                                                      |  |       |  |       |  |       |  |                                           |       |  |
| CFDCF5H99EI=HMG97IF=H=9G                                                                                       |  |       |  |       |  |       |  | R                                         |       |  |
| CFDCF5H9896HG97IF=H=9G                                                                                         |  | R     |  |       |  |       |  | R                                         |       |  |
| *G5B8'*G                                                                                                       |  | R     |  |       |  |       |  | R                                         |       |  |
| 0.;CJ9FBA9BH5B8:989F5@5;9B7M<br>G97IF=H=9G                                                                     |  |       |  |       |  | R     |  | R                                         |       |  |
| (IB=7=D5@G97IF=H=9G                                                                                            |  | R     |  |       |  | R     |  | R                                         |       |  |
| .CJ9F9=;BC6@=;5H=CBG                                                                                           |  |       |  |       |  | R     |  | R                                         |       |  |
| -9G=89BH=5@ACFH;5;9 657?98G97IF=H=9G                                                                           |  | R     |  |       |  |       |  | R                                         |       |  |
| CAA9F7=5@ACFH;5;9 657?98G97IF=H=9G                                                                             |  | R     |  |       |  | R     |  | R                                         |       |  |
| *H<9F5GG9H 657?98G97IF=H=9G                                                                                    |  | R     |  |       |  |       |  | R                                         |       |  |
| 'C5BG5B8CH<9FF979=J56@9G                                                                                       |  | R     |  | R     |  |       |  | R                                         |       |  |
| 9F=J5H=J9G                                                                                                     |  |       |  |       |  |       |  |                                           |       |  |
| %BJ9GHA9BHG5H:5=FJ5@I9                                                                                         |  | R     |  | R     |  |       |  | R                                         |       |  |
| /CH5@:=B5B7=5@=BGHFIA9BHGCKB98<br>9L7@I8=B;%BJ9GHA9BHG5H:5=FJ5@I9<br>65G98CB)1                                 |  |       |  |       |  |       |  |                                           |       |  |
| .97IF=H=9GG9;F9;5H985B8CB89DCG=H:CFF9;I@5HCFM<br>DIFDCG9GCF89DCG=H98K=H<7@95F=B;5B8<br>89DCG=HCFMCF;5B=N5H=CBG |  |       |  | R     |  | R     |  | R                                         |       |  |
| .97IF=H=9GF979=J985G7C@@5H9F5@                                                                                 |  |       |  | R     |  | R     |  | R                                         |       |  |
| 6./686@62?                                                                                                     |  |       |  |       |  |       |  |                                           |       |  |
| "=B5B7=5@=BGHFIA9BHGGC@8BCHM9H<br>DIF7<5G98                                                                   |  |       |  |       |  |       |  |                                           |       |  |
| CFDCF5H99EI=HMG97IF=H=9G                                                                                       |  |       |  |       |  | R     |  | R                                         |       |  |
| CFDCF5H9896HG97IF=H=9G                                                                                         |  | R     |  |       |  |       |  | R                                         |       |  |
| *G5B8'*G                                                                                                       |  | R     |  |       |  | R     |  | R                                         |       |  |
| 0.;CJ9FBA9BH5B8:989F5@5;9B7M<br>G97IF=H=9G                                                                     |  |       |  | R     |  | R     |  | R                                         |       |  |
| .CJ9F9=;BC6@=;5H=CBG                                                                                           |  | R     |  |       |  | R     |  | R                                         |       |  |
| -9G=89BH=5@ACFH;5;9 657?98G97IF=H=9G                                                                           |  | R     |  |       |  | R     |  | R                                         |       |  |
| CAA9F7=5@ACFH;5;9 657?98G97IF=H=9G                                                                             |  | R     |  | R     |  |       |  | R                                         |       |  |
| 9F=J5H=J9G                                                                                                     |  |       |  |       |  |       |  |                                           |       |  |
| /CH5@:=B5B7=5@=BGHFIA9BHGGC@8<br>BCHM9HDIF7<5G98                                                               |  |       |  |       |  |       |  |                                           |       |  |
| *H<9FG97IF98:=B5B7=B;G                                                                                         |  | R     |  | R     |  |       |  | R                                         |       |  |
| *6@=;5H=CBHCF9HIFBG97IF=H=9GF979=J985G7C@@5H9F5@                                                               |  |       |  | R     |  | R     |  | R                                         |       |  |

 -9DF9G9BHG7CIBH9FD5FHM5B875G<7C@@5H9F5@B9HH=B;57FCGGH<9@9J9@GC:H<9:5=FJ5@I9<=9F5F7<M:CFDCG=H=CBGK=H<H<9G5A9 7CIBH9FD5FHM

{16}------------------------------------------------

#### NOTES TO CONSOLIDATED STATEMENT OF FINANCIAL CONDITION - CONTINUED NOVEMBER 30, 2023

The following is a description of the valuation basis, including valuation techniques and inputs, used in measuring the Company's financial assets and liabilities that are accounted for at fair value on a recurring basis:

Cash and securities segregated and on deposit for regulatory purposes or deposited with clearing and depository organizations

Segregated U.S. Treasury securities are measured based on quoted market prices obtained from external pricing services and categorized within Level 1 of the fair value hierarchy.

Corporate Equity Securities

- · Exchange-Traded Equity Securities: Exchange-traded equity securities are measured based on quoted closing exchange prices, which are generally obtained from external pricing services, and are categorized within Level 1 of the fair value hierarchy, otherwise they are categorized within Level 2 of the fair value hierarchy.
- · Non-Exchange-Traded Equity Securities: Non-exchange-traded equity securities are measured, where available using broker quotations, pricing data from external pricing services and prices observed from recently executed market transactions and are categorized within Level 2 of the fair value hierarchy. Where such information is not available, non-exchange-traded equity securities are categorized within Level 3 of the fair value hierarchy and measured using valuation techniques involving quoted prices of or market data for comparable companies, similar company ratios and multiples (e.g., price/Earnings before interest, taxes, depreciation and amortization ("EBITDA"), price/book value), discounted cash flow analyses and transaction prices observed from subsequent financing or capital issuance by the company. When using pricing data of comparable companies, judgment must be applied to adjust the pricing data to account for differences between the measured security and the comparable security (e.g., issuer market capitalization, yield, dividend rate, geographical concentration).
- · Equity Warrants: Non-exchange-traded equity warrants are measured primarily using pricing data from external pricing services, prices observed from recently executed market transactions and broker quotations and are categorized within Level 2 of the fair value hierarchy. Where such information is not available, non-exchange-traded equity warrants are generally categorized within Level 3 of the fair value hierarchy and are measured using the Black-Scholes model with key inputs impacting the valuation including the underlying security price, implied volatility, dividend yield, interest rate curve, strike price and maturity date.

Corporate Debt Securities

· Investment Grade Corporate Bonds: Investment grade corporate bonds are measured primarily using pricing data from external pricing services and broker quotations, where available, prices observed from recently executed market transactions and bond spreads. Investment grade corporate bonds measured using these valuation methods are categorized within Level 2 of the fair value hierarchy. If broker quotes, pricing data or spread data is not available, alternative valuation techniques may be used. Investment grade corporate bonds measured using alternative valuation techniques are categorized within Level 2 or Level 3 of the fair value hierarchy.

{17}------------------------------------------------

#### **!"'&'""!&"'&'' !'"!!"!'"!"!'!( !") %**

P \$=;<3=9@8CFDCF5H95B8CBJ9FH=6@9CB8G G=;B=:=75BH DCFH=CB C:H<9CAD5BMUG <=;< M=9@8 7CFDCF5H95B87CBJ9FH=6@96CB8G5F975H9;CF=N98K=H<=B'9J9@C:H<9:5=FJ5@I9<=9F5F7<M5B85F9 A95GIF98DF=A5F=@MIG=B;6FC?9FEICH5H=CBG5B8DF=7=B;85H5:FCA9LH9FB5@DF=7=B;G9FJ=79GK<9F9 5J5=@56@9 5B8 DF=79G C6G9FJ98 :FCA F979BH@M 9L97IH98 A5F?9H HF5BG57H=CBG C: =BGH=HIH=CB5@ G=N9 2<9F9 DF=7=B; 85H5=G@9GG C6G9FJ56@9 J5@I5H=CBG5F975H9;CF=N98K=H<=B'9J9@ C:H<9 :5=F J5@I9 <=9F5F7<M5B85F965G98CBD9B8=B;HF5BG57H=CBG=BJC@J=B;H<9=GGI9FCF7CAD5F56@9=GGI9FGDF=79G =AD@=98 :FCA 5B=GGI9FUG GI6G9EI9BH :=B5B7=B; CF F975D=H5@=N5H=CB AC89@G=B7CFDCF5H=B; :=B5B7=5@ F5H=CG5B8DFC>97H9875G<:@CKGC:H<9=GGI9F5B8A5F?9HDF=79G:CF7CAD5F56@9=GGI9FG

#### *\$!!)'!. )!)\$#(#\$!!)'!.\$#!)\$#(*

C@@5H9F5@=N98 896H C6@=;5H=CBG S \*GT 5B8 7C@@5H9F5@=N98 @C5B C6@=;5H=CBG S'\*GT 5F9 A95GIF98 65G98 CB DF=79G C6G9FJ98 :FCA F979BH@M9L97IH98A5F?9HHF5BG57H=CBG C:H<9 G5A9 CF G=A=@5F G97IF=HM CF 65G98CBJ5@I5H=CBGF979=J98:FCAH<=F8
D5FHM6FC?9FGCF85H5DFCJ=89FG5B85F975H9;CF=N98K=H<=B'9J9@ CF'9J9@ C:H<9 :5=F J5@I9 <=9F5F7<M 89D9B8=B; CBH<9 C6G9FJ56=@=HM 5B8 G=;B=:=75B79 C:H<9 DF=7=B; =BDIHG15@I5H=CBH<5H=G65G98CBF979BH@M9L97IH98A5F?9HHF5BG57H=CBGC:G=A=@5FG97IF=H=9G=B7CFDCF5H9G 588=H=CB5@F9J=9K5B85B5@MG=GC:DF=7=B;=BDIHG5B87CAD5F56=@=HM7F=H9F=5=B7@I8=B;6IHBCH@=A=H98HC 7C@@5H9F5@HMD9HF5B7<9HMD9F5H=B;CF=;=B5H=CBM95FDF9D5MA9BHF5H9G89:5I@HF5H9G5B8@CGGG9J9F=HM

## *\$+'#"#)#'!#-\*')(*

- P 0. /F95GIFM .97IF=H=9G 0. /F95GIFM G97IF=H=9G 5F9 A95GIF98 65G98 CB EICH98 A5F?9H DF=79G C6H5=B98:FCA9LH9FB5@DF=7=B;G9FJ=79G5B875H9;CF=N98K=H<=B'9J9@C:H<9:5=FJ5@I9<=9F5F7<M
- P 0.;9B7M 96H.97IF=H=9G5@@56@95B8BCB
75@@56@90.5;9B7M896H G97IF=H=9G5F9A95GIF98 DF=A5F=@M65G98CBEICH98A5F?9HDF=79GC6H5=B98:FCA9LH9FB5@DF=7=B;G9FJ=79G5B85F9;9B9F5@@M 75H9;CF=N98K=H<=B'9J9@CF'9J9@C:H<9:5=FJ5@I9<=9F5F7<M

#### *\*#%!\*')(*

(IB=7=D5@G97IF=H=9G5F9A95GIF9865G98CBEICH98DF=79GC6H5=B98:FCA9LH9FB5@DF=7=B;G9FJ=79G5B85F9 ;9B9F5@@M75H9;CF=N98K=H<=B'9J9@C:H<9:5=FJ5@I9<=9F5F7<M

#### *\$+'#!)\$#(*

.CJ9F9=;B ;CJ9FBA9BH C6@=;5H=CBG 5F9A95GIF98 65G98 CB EICH98A5F?9H DF=79G C6H5=B98 :FCA 9LH9FB5@ DF=7=B; G9FJ=79G K<9F9 5J5=@56@9 CF F979BH@M 9L97IH98 =B89D9B89BH HF5BG57H=CBG C: 7CAD5F56@9 G=N9 .CJ9F9=;B ;CJ9FBA9BH C6@=;5H=CBG K=H< 7CBG=89F5H=CB ;=J9B HC H<9 7CIBHFM C: =GGI5B79 5F9 ;9B9F5@@M 75H9;CF=N98K=H<=B'9J9@C:H<9:5=FJ5@I9<=9F5F7<M

#### *(#)!\$') \*')(*

P ;9B7M -9G=89BH=5@ (CFH;5;9
57?98 .97IF=H=9G S-(.T ;9B7M -(. =B7@I89 ACFH;5;9 D5GG
H<FCI;< G97IF=H=9G :=L98 5B8 58>IGH56@9 F5H9  7C@@5H9F5@=N98 ACFH;5;9 C6@=;5H=CBG 5B8 DF=B7=D5@
CB@M 5B8 =BH9F9GH
CB@M =B7@I8=B; =BJ9FG9 =BH9F9GH
CB@M G97IF=H=9G ;9B7M -(. 5F9 ;9B9F5@@M A95GIF98 IG=B; F979BH HF5BG57H=CBG DF=7=B; 85H5 :FCA 9LH9FB5@ DF=7=B; G9FJ=79G CF 9LD97H98 :IHIF9 75G< :@CK H97<B=EI9G H<5H =B7CFDCF5H9 DF9D5MA9BH AC89@G 5B8 CH<9F DF9D5MA9BH 5GGIADH=CBGHC5ACFH=N9H<9IB89F@M=B;ACFH;5;9@C5B7C@@5H9F5@5B85F975H9;CF=N98K=H<=B'9J9@ CF'9J9@C:H<9:5=FJ5@I9<=9F5F7<M/<9CAD5BMIG9GDF=79GC6G9FJ98:FCAF979BH@M9L97IH98 HF5BG57H=CBGHC89J9@CDA5F?9H
7@95F=B;GDF9585B8M=9@87IFJ95GGIADH=CBG15@I5H=CB=BDIHGK=H< F9;5F8HCH<9 IB89F@M=B; 7C@@5H9F5@=B7CFDCF5H9 :57HCFG GI7< 5GK9=;<H98 5J9F5;9 7CIDCB@C5B
HC J5@I97F98=HG7CF9G;9C;F5D<=7@C75H=CBA5L=AIA5B85J9F5;9@C5BG=N9CF=;=B5HCFG9FJ=79F5B8 K9=;<H985J9F5;9@C5B5;9

{18}------------------------------------------------

#### NOTES TO CONSOLIDATED STATEMENT OF FINANCIAL CONDITION - CONTINUED NOVEMBER 30, 2023

· Non-Agency RMBS: The fair value of non-agency RMBS is determined primarily using discounted cash flow methodologies and securities are categorized within Level 2 or Level 3 of the fair value hierarchy based on the observability and significance of the pricing inputs used. Performance attributes of the underlying mortgage loans are evaluated to estimate pricing inputs, such as prepayment rates, default rates and the severity of credit losses. Attributes of the underlying mortgage loans that affect the pricing inputs include, but are not limited to, weighted average coupon; average and maximum loan size; loan-to-value; credit scores; documentation type; geographic location; weighted average loan age; originator; servicer; historical prepayment, default and loss severity experience of the mortgage loan pool; and delinquency rate. Yield curves used in the discounted cash flow models are based on observed market prices for comparable securities and published interest rate data to estimate market yields. In addition, broker quotes, where available, are also referenced to compare prices.

Commercial Mortgage-Backed Securities

- · Agency Commercial Mortgage-Backed Securities ("CMBS"): Government National Mortgage Association ("GNMA") project loan bonds are measured based on inputs corroborated from and benchmarked to observed prices of recent securitization transactions of similar securities with adjustments incorporating an evaluation of various factors, including prepayment speeds, default rates and cash flow structures, as well as the likelihood of pricing levels in the current market environment. Federal National Mortgage Association ("FNMA") Delegated Underwriting and Servicing ("DUS") mortgage-backed securities are generally measured by using prices observed from recently executed market transactions to estimate market-clearing spread levels for purposes of estimating fair value. GNMA project loan bonds and FNMA DUS mortgage-backed securities are categorized within Level 2 of the fair value hierarchy.
- · Non-Agency CMBS: Non-agency CMBS are measured using pricing data obtained from external pricing services, prices observed from recently executed market transactions or based on expected cash flow models that incorporate underlying loan collateral characteristics and performance. Non-Agency CMBS are categorized within Level 2 or Level 3 of the fair value hierarchy depending on the observability of the underlying inputs.

#### Other Asset-Backed Securities

Other asset-backed securities ("ABS") include, but are not limited to, securities backed by auto loans, credit card receivables, student loans and other consumer loans and are categorized within Level 2 or Level 3 of the fair value hierarchy. Valuations are primarily determined using pricing data obtained from external pricing services, broker quotes and prices observed from recently executed market transactions. In addition, recent transaction data from comparable deals is deployed to develop market clearing yields and cumulative loss assumptions. The cumulative loss assumptions are based on the analysis of the underlying collateral and comparisons to earlier deals from the same issuer to gauge the relative performance of the deal.

#### Loans and Other Receivables

· Corporate Loans: Corporate loans categorized within Level 3 of the fair value hierarchy are measured based on price quotations that are considered to be less transparent, market prices for debt securities of the same creditor and estimates of future cash flows incorporating assumptions regarding creditor default and recovery rates and consideration of the issuer's capital structure.

{19}------------------------------------------------

#### **!"'&'""!&"'&'' !'"!!"!'"!"!'!( !") %**

 *'+)+(*

- P '=GH98 9F=J5H=J9CBHF57HG'=GH9889F=J5H=J97CBHF57HGH<5H5F957H=J9@MHF58985F9A95GIF9865G98 CB EICH98 9L7<5B;9 DF=79G 6FC?9F EICH9G CF J5B=@@5 CDH=CB J5@I5H=CB AC89@G GI7< 5G @57? .7<C@9GIG=B;C6G9FJ56@9J5@I5H=CB=BDIHG:FCAH<9DF=B7=D5@A5F?9HCF7CBG9BGIGDF=7=B;G9FJ=79G !L7<5B;9EICH9G5B8CFJ5@I5H=CB=BDIHG5F9;9B9F5@@MC6H5=B98:FCA9LH9FB5@J9B8CFG5B8DF=7=B; G9FJ=79G FC?9F EICH9G 5F9 J5@=85H98 8=F97H@M H<FCI;< C6G9FJ56@9 5B8 HF58956@9 EICH9G '=GH98 89F=J5H=J97CBHF57HGH<5HIG99L7<5B;97@CG9DF=79G5F9;9B9F5@@M75H9;CF=N98K=H<=B'9J9@C:H<9 :5=FJ5@I9<=9F5F7<M@@CH<9F@=GH9889F=J5H=J97CBHF57HG5F9;9B9F5@@M75H9;CF=N98K=H<=B'9J9@C: H<9:5=FJ5@I9<=9F5F7<M
- P \*J9F
H<9
CIBH9F S\*/T 9F=J5H=J9 CBHF57HG \*/ 89F=J5H=J9 7CBHF57HG 5F9 ;9B9F5@@M J5@I98 IG=B; AC89@G K<CG9 =BDIHG F9:@97H 5GGIADH=CBG H<5H H<9 CAD5BM 69@=9J9G A5F?9H D5FH=7=D5BHG KCI@8IG9=BJ5@I=B;H<989F=J5H=J9=B57IFF9BHHF5BG57H=CB2<9F95J5=@56@9J5@I5H=CB=BDIHG5F9 75@=6F5H98:FCAC6G9FJ56@9A5F?9H85H5"CFA5BM\*/89F=J5H=J97CBHF57HGH<9J5@I5H=CBAC89@G 8CBCH=BJC@J9A5H9F=5@GI6>97H=J=HM5GH<9A9H<C8C@C;=9G8CBCH9BH5=@G=;B=:=75BH>I8;A9BH5B8H<9 =BDIHG HC J5@I5H=CB AC89@G 8C BCH =BJC@J9 5 <=;< 89;F99 C: GI6>97H=J=HM 5G H<9 J5@I5H=CB AC89@ =BDIHG 5F9 F958=@M C6G9FJ56@9 CF 75B 69 89F=J98 :FCA 57H=J9@M EICH98 A5F?9HG \*/ 89F=J5H=J9 7CBHF57HG5F9DF=A5F=@M75H9;CF=N98K=H<=B'9J9@C:H<9:5=FJ5@I9<=9F5F7<M;=J9BH<9C6G9FJ56=@=HM 5B8G=;B=:=75B79C:H<9=BDIHGHCH<9J5@I5H=CBAC89@G2<9F9G=;B=:=75BH=BDIHGHCH<9J5@I5H=CB5F9 IBC6G9FJ56@989F=J5H=J9=BGHFIA9BHG5F975H9;CF=N98K=H<=B'9J9@C:H<9:5=FJ5@I9<=9F5F7<M

\*/ CDH=CBG =B7@I89 \*/ 9EI=HM :CF9=;B 9L7<5B;9 5B8 =BH9F9GH F5H9 CDH=CBG A95GIF98 IG=B; J5F=CIGJ5@I5H=CBAC89@GGI7<5G@57?
.7<C@9GK=H<?9M=BDIHG=B7@I8=B;H<9IB89F@M=B;G97IF=HM DF=79 :CF9=;B 9L7<5B;9 GDCH F5H9=AD@=98 JC@5H=@=HM=BH9F9GH F5H9 7IFJ9 GHF=?9 DF=79 5B8A5HIF=HM 85H9 =G7CIBH98 75G< :@CK AC89@G 5F9 IH=@=N98 HC A95GIF9 79FH5=B \*/ 89F=J5H=J9 7CBHF57HG =B7@I8=B;H<9J5@I5H=CBGC:H<9CAD5BMUG=BH9F9GHF5H9GK5DGK<=7<=B7CFDCF5H9C6G9FJ56@9=BDIHG F9@5H98HC=BH9F9GHF5H97IFJ9G5B8J5@I5H=CBGC:H<9CAD5BMUG:CF9=;B9L7<5B;9:CFK5F8GK<=7< =B7CFDCF5H9C6G9FJ56@9=BDIHGF9@5H98HC:CF9=;B7IFF9B7MGDCHF5H9G5B8:CFK5F87IFJ9G

#### *#+()"#)()'!\**

%BJ9GHA9BHG 5H :5=F J5@I9 =B7@I89G =BJ9GHA9BHG =B <98;9 :IB8G 5B8 DF=J5H9 9EI=HM :IB8G K<=7< 5F9 A95GIF985HH<9)1C:H<9:IB8GDFCJ=8986MH<9:IB8A5B5;9FG5B85F99L7@I898:FCAH<9:5=FJ5@I9 <=9F5F7<M%BJ9GHA9BHG5H:5=FJ5@I95@GC=B7@I898=F97H9EI=HM=BJ9GHA9BHG=BDF=J5H97CAD5B=9GK<=7<5F9 A95GIF98 5H :5=F J5@I9 IG=B; J5@I5H=CB H97<B=EI9G =BJC@J=B; EICH98 DF=79G C: CF A5F?9H 85H5 :CF 7CAD5F56@9 7CAD5B=9G G=A=@5F 7CAD5BM F5H=CG 5B8 AI@H=D@9G 9; DF=79!%/  DF=796CC? J5@I9  8=G7CIBH98 75G< :@CK 5B5@MG9G 5B8 HF5BG57H=CB DF=79G C6G9FJ98 :CF GI6G9EI9BH :=B5B7=B; CF 75D=H5@ =GGI5B796MH<97CAD5BM =F97H9EI=HM=BJ9GHA9BHG=BDF=J5H97CAD5B=9G5F9;9B9F5@@M75H9;CF=N98K=H<=B '9J9@CF'9J9@C:H<9:5=FJ5@I9<=9F5F7<M

{20}------------------------------------------------

#### NOTES TO CONSOLIDATED STATEMENT OF FINANCIAL CONDITION - CONTINUED NOVEMBER 30, 2023

The following table presents information about the Company's investments in entities that have the characteristics of an investment company at November 30, 2023 (in thousands):

|                  | Fair Value ( |     |  | ntunded |
|------------------|--------------|-----|--|---------|
| Equity Funds (2) |              | 252 |  |         |
| Tota:            |              | 252 |  |         |

- (1) Where fair value is calculated based on NAV, fair value has been derived from each of the funds' capital statements.
- (2) This category primarily includes investments in equity funds that invest in the equity of various foreign private companies. The investments in this category cannot be redeemed; instead, distributions are received through the liquidation of the underlying assets of the funds which are expected to be liquidated in approximately ten years.

#### Securities Received as Collateral / Obligations to Return Securities Received as Collateral

In connection with securities transactions in which the Company is the lender of securities and is permitted to sell or repledge the securities received as collateral, the Company reports the fair value of the collateral received and the related obligation to return the collateral. Valuation is based on the price of the underlying security and is categorized within the corresponding guidance above. These financial instruments are typically categorized within Level 1 of the fair value hierarchy.

#### Other Secured Financings

Other secured financings that are accounted for at fair value are classified within Level 3 of the fair value hierarchy. Fair value is based on estimates of future cash flows incorporating assumptions regarding recovery rates.

## Quantitative Information about Significant Unobservable Inputs used in Level 3 Fair Value Measurements at November 30, 2023

The table below presents information on the valuation techniques, significant unobservable inputs and their ranges for the Company's financial assets and liabilities, subject to threshold levels related to the market value of the positions held, measured at fair value on a recurring basis with a significant Level 3 balance. The range of unobservable inputs could differ significantly across different firms given the range of products across different firms in the financial services sector. The inputs are not representative of the inputs that could have been used in the valuation of any one financial instrument (i.e., the input used for valuing one financial instrument within a particular class of financial instruments may not be appropriate for valuing other financial instruments within that given class). Additionally, the ranges of inputs presented below should not be construed to represent uncertainty regarding the fair values of the Company's financial instruments; rather, the range of inputs is reflective of the differences in the underlying characteristics of the financial instruments in each category.

For certain categories, the Company has provided a weighted average of the inputs allocated based on the fair values of the financial instruments comprising the category. The Company does not believe that the range or weighted average of the inputs is indicative of the reasonableness of uncertainty of its Level 3 fair values. The range and weighted average are driven by the individual financial instruments within each category and their relative distribution in the population. The disclosed inputs when compared with the inputs as disclosed in other periods should not be expected to necessarily be indicative of changes in the Company's estimates of unobservable inputs for a particular financial instrument as the population of financial instruments comprising the category will vary from period based on purchases and sales of financial instruments during the period as well as transfers into and out of Level 3 each period.

{21}------------------------------------------------

#### **!"'&'""!&"'&'' !'"!!"!'"!"!'!( !") %**

| 6:.:06.8:?@>A92:@?<br>"C:21       |  | .6>).8A2<br>6:@5;A?.:1? | ).8A.@6;:'205:6=A2 | &64:6360.:@(:;/?2>B./82<br>:<A@<br>? | :<A@%.:42 | *2645@21<br>B2>.42 |  |
|-----------------------------------|--|-------------------------|--------------------|--------------------------------------|-----------|--------------------|--|
| ;><;>.@22=A6@E<br>?20A>6@62?      |  |                         |                    |                                      |           |                    |  |
| )CB 9L7<5B;9 HF5898<br>G97IF=H=9G |  |                         | (5F?9H5DDFC57<     | +F=79                                |           |                    |  |
| "?.:1"?                           |  |                         | =G7CIBH9875G<:@CKG | CBGH5BHDF9D5MA9BHF5H9                |           | R                  |  |
|                                   |  |                         |                    | CBGH5BH89:5I@HF5H9                   |           | R                  |  |
|                                   |  |                         |                    | 'CGGG9J9F=HM                         |           | R                  |  |
|                                   |  |                         |                    | =G7CIBHF5H9M=9@8                     |           |                    |  |
| "@52>&                            |  |                         | =G7CIBH9875G<:@CKG | =G7CIBHF5H9M=9@8                     |           |                    |  |
|                                   |  |                         |                    | IAI@5H=J9@CGGF5H9                    |           |                    |  |
|                                   |  |                         |                    | IF5H=CBM95FG                         |           |                    |  |
| ;.:?.:1;@52><br>>2026B./82?       |  |                         | .79B5F=C5B5@MG=G   | !GH=A5H98F97CJ9FMD9F79BH5;9          |           |                    |  |
| :B2?@92:@?.@3.6>B.8A2             |  |                         |                    |                                      |           |                    |  |
| +F=J5H99EI=HM<br>G97IF=H=9G       |  |                         | (5F?9H5DDFC57<     | +F=79                                |           |                    |  |
| "@52>?20A>2136:.:06:4?            |  |                         | .79B5F=C5B5@MG=G   | !GH=A5H98F97CJ9FMD9F79BH5;9          |           |                    |  |

/<9:5=FJ5@I9GC:79FH5=B'9J9@5GG9HG5B8@=56=@=H=9GH<5HK9F989H9FA=B9865G98CBH<=F8
D5FHMDF=7=B; =B:CFA5H=CB 5F9 9L7@I898 :FCA H<9 56CJ9 H56@9 H )CJ9A69F   5GG9H 9L7@IG=CBG 7CBG=GH98 C: A=@@=CB7CADF=G98 C:7CFDCF5H9 896H G97IF=H=9G-(.5B879FH5=B 89F=J5H=J9GH)CJ9A69F   @=56=@=HM 9L7@IG=CBG 7CBG=GH98 C: A=@@=CB 7CADF=G98 C: 7CFDCF5H9 896H G97IF=H=9G @C5BG 5B8 79FH5=B89F=J5H=J9G

#### *#')#)-\$'!\*(\*'"#)'\$"(\$##)#\$('+!#%\*)(*

"CF F97IFF=B; :5=F J5@I9 A95GIF9A9BHG 75H9;CF=N98 K=H<=B '9J9@ C: H<9 :5=F J5@I9 <=9F5F7<M H<9 IB79FH5=BHM C: H<9 :5=F J5@I9 A95GIF9A9BH HC 7<5B;9G =B G=;B=:=75BH IBC6G9FJ56@9 =BDIHG 5B8 =BH9FF9@5H=CBG<=DG69HK99BH<CG9IBC6G9FJ56@9=BDIHG=:5BM 5F989G7F=69869@CK

- P )CB
9L7<5B;9
HF5898 G97IF=H=9G 5B8 DF=J5H9 9EI=HM G97IF=H=9G IG=B; 5 A5F?9H 5DDFC57< J5@I5H=CB H97<B=EI9 G=;B=:=75BH=B7F95G9 897F95G9 =BH<9 DF=79 C:H<9 BCB
9L7<5B;9
HF5898 G97IF=H=9G CF DF=J5H99EI=HMG97IF=H=9GKCI@8F9GI@H=B5G=;B=:=75BH@M<=;<9F@CK9F :5=FJ5@I9A95GIF9A9BH
- P 'C5BG 5B8 CH<9F F979=J56@9G 5B8 CH<9F G97IF98 :=B5B7=B;G IG=B; G79B5F=C 5B5@MG=G G=;B=:=75BH =B7F95G9 897F95G9 =B H<9 DCGG=6@9 F97CJ9FM F5H9G C: H<9 75G< :@CK CIH7CA9G IB89F@M=B; H<9 =BJ9GHA9BHKCI@8 F9GI@H=B5G=;B=:=75BH@M<=;<9F @CK9F :5=FJ5@I9A95GIF9A9BH :CFH<9 :=B5B7=5@ =BGHFIA9BH
- P \*G5B8'\*G5B8 CH<9F. IG=B;5 8=G7CIBH9875G< :@CK J5@I5H=CBH97<B=EI9 G=;B=:=75BH =B7F95G9 897F95G9 =B =GC@5H=CB =B H<9 7CBGH5BH 89:5I@H F5H9 @CGG G9J9F=HM CF 7IAI@5H=J9 @CGG F5H9 KCI@8F9GI@H=B5G=;B=:=75BH@M@CK9F<=;<9F :5=FJ5@I9A95GIF9A9BH/<9=AD57HC:7<5B;9G=BH<9 7CBGH5BH DF9D5MA9BH F5H9 5B8 8IF5H=CB KCI@8 <5J9 8=::9F=B; =AD57HG 89D9B8=B; CB H<9 75D=H5@ GHFI7HIF95B8HMD9C: G97IF=HM G=;B=:=75BH=B7F95G9 897F95G9 =BH<98=G7CIBH F5H9G97IF=HMM=9@8 KCI@8F9GI@H=B5G=;B=:=75BH@M@CK9F<=;<9F :5=FJ5@I9A95GIF9A9BH

{22}------------------------------------------------

#### **!"'&'""!&"'&'' !'"!!"!'"!"!'!( !") %**

#### *\$'"&! &!*

/<9CAD5BM<5G9@97H98H<9 :5=FJ5@I9CDH=CB :CF5@@@C5BG5B8@C5B7CAA=HA9BHGA5896M=HG75D=H5@ A5F?9HG6IG=B9GG9G5B8=B7CBB97H=CBK=H<=HGG97IF=H=N5H=CB57H=J=H=9G'C5BG5B8@C5B7CAA=HA9BHG5F9 A5B5;98CB5:5=FJ5@I965G=G5B85F9=B7@I898=B"=B5B7=5@=BGHFIA9BHGCKB985B8"=B5B7=5@=BGHFIA9BHG GC@8BCHM9HDIF7<5G98=BH<9CBGC@=85H98.H5H9A9BHC:"=B5B7=5@CB8=H=CB/<9 :5=FJ5@I9CDH=CB<5G 699B 9@97H98 :CF 79FH5=B CH<9F G97IF98 :=B5B7=B;G H<5H 5F=G9 =B 7CBB97H=CB K=H< H<9 CAD5BMUG G97IF=H=N5H=CB57H=J=H=9G5B8CH<9FGHFI7HIF98:=B5B7=B;G

/<95ACIBH6MK<=7<7CBHF57HI5@DF=B7=D5@9L799898:5=FJ5@I9:CFH<9G9@C5BG5B8CH<9FF979=J56@9GK5G A=@@=CB5H)CJ9A69FK<=7<=B7@I89GA=@@=CBCBBCB577FI5@GH5HIG5B885MGCF ;F95H9FD5GH8I9/<95;;F9;5H9:5=FJ5@I9C:@C5BG5B8CH<9FF979=J56@9GCBBCB577FI5@GH5HIG5B885MG CF;F95H9FD5GH8I9K5GA=@@=CB5H)CJ9A69F

/<9 5ACIBH 6M K<=7< 7CBHF57HI5@ DF=B7=D5@ 9L799898 :5=F J5@I9 :CFH<9G9 CH<9F G97IF98 :=B5B7=B;G K5G A=@@=CB5H)CJ9A69F

#### *%&\$' &%!&
%'\$& \$'*

9FH5=BC:H<9CAD5BMUG:=B5B7=5@=BGHFIA9BHG5F9BCH75FF=985H:5=FJ5@I96IH5F9F97CF8985H5ACIBHG H<5H 5DDFCL=A5H9 :5=F J5@I9 8I9HCH<9=F@=EI=8 CF G<CFH
H9FA B5HIF9 5B8 ;9B9F5@@M B9;@=;=6@9 7F98=H F=G? /<9G9 :=B5B7=5@ 5GG9HG =B7@I89 5G< 5B8 75G< 9EI=J5@9BHG 5B8 5G< 5B8 G97IF=H=9G G9;F9;5H98 5B8 CB 89DCG=H :CF F9;I@5HCFM DIFDCG9G CF 89DCG=H98 K=H< 7@95F=B; 5B8 89DCG=HCFM CF;5B=N5H=CBG 5B8 KCI@8 ;9B9F5@@M69DF9G9BH98K=H<=B'9J9@C:H<9:5=FJ5@I9<=9F5F7<M

-979=J56@9GQFC?9FG895@9FG5B87@95F=B;CF;5B=N5H=CBG-979=J56@9GQIGHCA9FG-979=J56@9GQ"99G =BH9F9GH 5B8 CH<9F -979=J56@9G Q I9 :FCA 5::=@=5H9G +5M56@9G Q FC?9FG 895@9FG 5B8 7@95F=B; CF;5B=N5H=CBG+5M56@9GQIGHCA9FG5B8+5M56@9GQ I9HC+5F9BH5B85::=@=5H9G5F9577CIBH98:CF5H7CGH D@IG577FI98=BH9F9GHF5H<9FH<5B:5=FJ5@I9<CK9J9FH<9F97CF8985ACIBHG5DDFCL=A5H9:5=FJ5@I98I9HC H<9=F@=EI=8CFG<CFH
H9FAB5HIF9

## **%)')!!!&'%( !'&**

**"33.8.:02&522@%6?7**R/<9CAD5BM<5G7CBHF57HI5@7CAA=HA9BHG5F=G=B;=BH<9CF8=B5FM7CIFG9C: 6IG=B9GG :CF G97IF=H=9G @C5B98 CF DIF7<5G98 IB89F 5;F99A9BHG HC F9G9@@ F9DIF7<5G9 5;F99A9BHG :IHIF9 DIF7<5G9G5B8G5@9GC::CF9=;B7IFF9B7=9GG97IF=H=9GHF5BG57H=CBGCB5K<9B
=GGI9865G=G5B8IB89FKF=H=B; !57< C: H<9G9 :=B5B7=5@ =BGHFIA9BHG 5B8 57H=J=H=9G 7CBH5=BG J5FM=B; 89;F99G C: C::
65@5B79 G<99H F=G? K<9F96MH<9:5=FJ5@I9GC:H<9G97IF=H=9GIB89F@M=B;H<9:=B5B7=5@=BGHFIA9BHGA5M69=B9L79GGC:CF@9GG H<5BH<97CBHF57H5ACIBH/<9G9HH@9A9BHC:H<9G9HF5BG57H=CBG=GBCH9LD97H98HC<5J95A5H9F=5@9::97HCB H<9CBGC@=85H98.H5H9A9BHC:"=B5B7=5@CB8=H=CB

**2>6B.@6B26:.:06.8:?@>A92:@?**R/<9CAD5BMUG89F=J5H=J957H=J=H=9G5F9 F97CF8985H :5=FJ5@I9=B H<9 CBGC@=85H98 .H5H9A9BH C: "=B5B7=5@ CB8=H=CB =B "=B5B7=5@ =BGHFIA9BHG CKB98 5B8 "=B5B7=5@ =BGHFIA9BHGGC@8BCHM9HDIF7<5G98B9HC:75G<D5=8CFF979=J98IB89F7F98=HGIDDCFH5;F99A9BHG5B8CB5 B9H7CIBH9FD5FHM65G=GK<9B5@9;5@@M9B:CF7956@9F=;<HHCC::G9H9L=GHGIB89F5A5GH9FB9HH=B;5;F99A9BH /<9CAD5BM9BH9FG=BHC89F=J5H=J9HF5BG57H=CBGHCG5H=G:MH<9B998GC:=HG7@=9BHG5B8HCA5B5;9=HGCKB 9LDCGIF9 HC A5F?9H 5B8 7F98=H F=G?G F9GI@H=B; :FCA =HG HF58=B; 57H=J=H=9G .99 )CH9  "5=F 15@I9 =G7@CGIF9G 5B8 )CH9  CAA=HA9BHG 5B8 #I5F5BH99G :CF 588=H=CB5@ 8=G7@CGIF9G 56CIH 89F=J5H=J9 :=B5B7=5@=BGHFIA9BHG

 9F=J5H=J9G5F9GI6>97HHCJ5F=CIGF=G?GG=A=@5FHCCH<9F:=B5B7=5@=BGHFIA9BHG=B7@I8=B;A5F?9H7F98=H5B8 CD9F5H=CB5@ F=G? /<9 F=G?G C: 89F=J5H=J9G G<CI@8 BCH 69 J=9K98 =B =GC@5H=CB 6IH F5H<9F G<CI@8 69 7CBG=89F98CB5B5;;F9;5H965G=G5@CB;K=H<H<9CAD5BMUGCH<9FHF58=B;
F9@5H9857H=J=H=9G/<9CAD5BM

{23}------------------------------------------------

## TBBIBRIBS DOC

#### NOTES TO CONSOLIDATED STATEMENT OF FINANCIAL CONDITION - CONTINUED NOVEMBER 30, 2023

manages the risks associated with derivatives on an aggregate basis along with the risks associated with proprietary trading as part of its firm wide risk management policies.

In connection with its derivative activities, the Company may enter netting agreements or similar agreements with counterparties. See Note 2, Significant Accounting Policies for additional information regarding the offsetting of derivative contracts.

The following table presents the fair value and related number of derivative contracts at November 30, 2023 categorized by type of derivative contract and the platform on which these derivatives are transacted. The fair value of assets/liabilities represents the Company's receivable/payable for derivative financial instruments, gross of counterparty netting and cash collateral received and pledged. The following table also provides information regarding (1) the extent to which, under enforceable master netting arrangements, such balances are presented net in the Consolidated Statement of Financial Condition as appropriate under U.S. GAAP and (2) the extent to which other rights of setoff associated with these arrangements exist and could have an effect on the Company's financial position (in thousands, except contract amounts).

|                                                                                                                                                                                | November 30, 2023 (1) |          |                            |            |             |                            |  |  |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------|----------|----------------------------|------------|-------------|----------------------------|--|--|
|                                                                                                                                                                                |                       |          | Assets                     |            | Liabilities |                            |  |  |
|                                                                                                                                                                                | Fair Value            |          | Number of<br>Contracts (2) | Fair Value |             | Number of<br>Contracts (2) |  |  |
| Equity contracts:                                                                                                                                                              |                       |          |                            |            |             |                            |  |  |
| Exchange-traded                                                                                                                                                                |                       | 278,873  | 837,998                    | ਦਿ         | 248,459     | 752,127                    |  |  |
| Bilateral OTC                                                                                                                                                                  |                       | 1,754    | 3                          |            | 2,943       |                            |  |  |
| Interest rate contracts:                                                                                                                                                       |                       |          |                            |            |             |                            |  |  |
| Exchange-traded                                                                                                                                                                |                       | 287      | 36,128                     |            | 49          | 16,594                     |  |  |
| Cleared OTC ------------------------------------------------------------------------------------------------------------------------------------------------------------------ |                       | 23,929   | 385                        |            | 63,948      | 549                        |  |  |
| Bilateral OTC ---------------------------------------------------------------------------------------------------------------------------------------------------------------- |                       | 69,317   | 836                        |            | 68,503      | 389                        |  |  |
| Foreign exchange contracts:                                                                                                                                                    |                       |          |                            |            |             |                            |  |  |
| Bilateral OTC                                                                                                                                                                  |                       | 1,470    | 3,285                      |            | 1,612       | 3,812                      |  |  |
| Commodity contracts:                                                                                                                                                           |                       |          |                            |            |             |                            |  |  |
| Exchange-traded                                                                                                                                                                |                       | 2        | 80                         |            |             |                            |  |  |
| Total gross derivative assets/liabilities:                                                                                                                                     |                       |          |                            |            |             |                            |  |  |
| Exchange-traded                                                                                                                                                                |                       | 279,162  |                            |            | 248,508     |                            |  |  |
| Cleared OTC                                                                                                                                                                    |                       | 23,929   |                            |            | 63,948      |                            |  |  |
| Bilateral OTC                                                                                                                                                                  |                       | 72,541   |                            |            | 73,058      |                            |  |  |
| Amounts offset in the Consolidated Statement<br>of Financial Condition (3):                                                                                                    |                       |          |                            |            |             |                            |  |  |
| Exchange-traded  (247,789)                                                                                                                                                     |                       |          |                            |            | (247,789)   |                            |  |  |
| Cleared OTC                                                                                                                                                                    |                       | (23,929) |                            |            | (23,929)    |                            |  |  |
| Bilateral OTC                                                                                                                                                                  |                       | (35,395) |                            |            | (2,607)     |                            |  |  |
| Net amounts per Consolidated Statement of<br>Financial Condition (4)                                                                                                           |                       | 68,519   |                            | ਦਿੱਤੇ      | 111,189     |                            |  |  |

{24}------------------------------------------------

#### **!"'&'""!&"'&'' !'"!!"!'"!"!'!( !") %**

- !L7<5B;9
HF589889F=J5H=J9G=B7@I8989F=J5H=J9G9L97IH98CB5BCF;5B=N989L7<5B;9@95F98\*/89F=J5H=J9G =B7@I89 89F=J5H=J9G 9L97IH98 6=@5H9F5@@M 5B8 GI6G9EI9BH@M BCJ5H98 HC 5B8 7@95F98 H<FCI;< 79BHF5@ 7@95F=B; 7CIBH9FD5FH=9G=@5H9F5@\*/89F=J5H=J9G=B7@I8989F=J5H=J9G9L97IH985B8G9HH@986=@5H9F5@@MK=H<CIHH<9IG9C: 5BCF;5B=N989L7<5B;9CF79BHF5@7@95F=B;7CIBH9FD5FHM
- )IA69F C: 9L7<5B;9
HF5898 7CBHF57HG A5M=B7@I89 CD9B :IHIF9G 7CBHF57HG /<9 IBG9HH@98 :5=F J5@I9 C:H<9G9 :IHIF9G7CBHF57HG=G=B7@I898=B-979=J56@9G:FCA+5M56@9GHC6FC?9FG895@9FG5B87@95F=B;CF;5B=N5H=CBG=BH<9 CBGC@=85H98.H5H9A9BHC:"=B5B7=5@CB8=H=CB
- ACIBHGB9HH98=B7@I896CH<B9HH=B;6M7CIBH9FD5FHM5B8:CF75G<7C@@5H9F5@D5=8CFF979=J98
- /<9CAD5BM<5GBCHF979=J98CFD@98;98588=H=CB5@7C@@5H9F5@IB89FA5GH9FB9HH=B;5;F99A9BHG5B8CFCH<9F 7F98=H GIDDCFH 5;F99A9BHG H<5H =G 9@=;=6@9 HC 69 C::G9H 69MCB8 K<5H <5G 699B C::G9H =B H<9 CBGC@=85H98 .H5H9A9BHC:"=B5B7=5@CB8=H=CB

 *'+)+(* /<9 H56@9 69@CK G9HG :CFH< 6M F9A5=B=B; 7CBHF57H A5HIF=HM H<9 :5=F J5@I9 C: \*/ 89F=J5H=J95GG9HG5B8@=56=@=H=9G5H)CJ9A69F=BH<CIG5B8G 

|                                                                |         | */ 9F=J5H=J9GG9HG |                      |                          |       |  |  |  |  |  |  |
|----------------------------------------------------------------|---------|-------------------|----------------------|--------------------------|-------|--|--|--|--|--|--|
|                                                                | Q(CBH<G | Q395FG            | #F95H9F/<5B<br>395FG | FCGG (5HIF=HM<br>)9HH=B; | /CH5@ |  |  |  |  |  |  |
| !EI=HMCDH=CBG5B8:CFK5F8G                                       | <br>    | <br>R             | <br>R                | <br>R                    | <br>  |  |  |  |  |  |  |
| "CF9=;B7IFF9B7MGDCHG5B8<br>:CFK5F8G                            | <br>    | <br>R             | <br>R                | <br>R                    | <br>  |  |  |  |  |  |  |
| %BH9F9GHF5H9:CFK5F8G5B8<br>GK5DG                               | <br>    | <br>R             | <br>                 | <br>R                    | <br>  |  |  |  |  |  |  |
| /CH5@                                                          | <br>    | <br>R             | <br>                 | <br>R                    | <br>  |  |  |  |  |  |  |
| FCGG DFC8I7H7CIBH9FD5FHM<br>B9HH=B;                            |         |                   |                      |                          | <br>  |  |  |  |  |  |  |
| /CH5@*/89F=J5H=J9G<br>5GG9HG=B7@I898=B<br>"=B5B7=5@=BGHFIA9BHG |         |                   |                      |                          |       |  |  |  |  |  |  |
| CKB98<br>                                                      |         |                   |                      |                          | <br>  |  |  |  |  |  |  |

 H)CJ9A69FH<9CAD5BM<9@89L7<5B;9
HF589889F=J5H=J95GG9HGK=H<5:5=FJ5@I9C:A=@@=CB K<=7<5F9BCH=B7@I898=BH<=GH56@9

 \*/89F=J5H=J95GG9HG=BH<9H56@956CJ95F9;FCGGC:7C@@5H9F5@ F979=J98\*/89F=J5H=J95GG9HG5F9 F97CF898 B9HC:7C@@5H9F5@F979=J98=BH<9CBGC@=85H98.H5H9A9BHC:"=B5B7=5@CB8=H=CBH)CJ9A69F75G< 7C@@5H9F5@F979=J98K5GA=@@=CB

 9F=J5H=J9:5=FJ5@I9G=B7@I897CIBH9FD5FHMB9HH=B;K=H<=BDFC8I7H75H9;CFM

{25}------------------------------------------------

#### **!"'&'""!&"'&'' !'"!!"!'"!"!'!( !") %**

|                                                                                                 | */ 9F=J5H=J9'=56=@=H=9G |        |                      |                          |       |  |  |  |  |
|-------------------------------------------------------------------------------------------------|-------------------------|--------|----------------------|--------------------------|-------|--|--|--|--|
|                                                                                                 | Q(CBH<G                 | Q395FG | #F95H9F/<5B<br>395FG | FCGG (5HIF=HM<br>)9HH=B; | /CH5@ |  |  |  |  |
| !EI=HMCDH=CBG5B8:CFK5F8G                                                                        |                         |        |                      |                          |       |  |  |  |  |
|                                                                                                 |                         | R      | R                    | R                        |       |  |  |  |  |
| "CF9=;B7IFF9B7MGDCHG5B8                                                                         |                         |        |                      |                          |       |  |  |  |  |
| :CFK5F8G                                                                                        |                         | R      | R                    | R                        |       |  |  |  |  |
| %BH9F9GHF5H9:CFK5F8G5B8                                                                         |                         |        |                      |                          |       |  |  |  |  |
| GK5DG                                                                                           |                         |        |                      | R                        |       |  |  |  |  |
| /CH5@                                                                                           |                         |        |                      |                          |       |  |  |  |  |
|                                                                                                 |                         |        |                      | R                        |       |  |  |  |  |
| FCGG DFC8I7H7CIBH9FD5FHM<br>B9HH=B;                                                             |                         |        |                      |                          | <br>  |  |  |  |  |
| /CH5@*/89F=J5H=J9G<br>@=56=@=H=9G=B7@I898=B<br>"=B5B7=5@=BGHFIA9BHG<br>GC@8M9HBCHDIF7<5G98<br> |                         |        |                      |                          | <br>  |  |  |  |  |

 H )CJ9A69F   H<9 CAD5BM <9@8 9L7<5B;9
HF5898 89F=J5H=J9 @=56=@=H=9G K=H< 5 :5=F J5@I9 C: A=@@=CBK<=7<5F9BCH=B7@I898=BH<=GH56@9

 9F=J5H=J9:5=FJ5@I9G=B7@I897CIBH9FD5FHMB9HH=B;K=H<=BDFC8I7H75H9;CFM

/<9 :C@@CK=B; H56@9 DF9G9BHG H<9 7CIBH9FD5FHM 7F98=H EI5@=HM K=H< F9GD97H HC H<9 :5=F J5@I9 C: H<9 CAD5BMUG\*/89F=J5H=J95GG9HG5H)CJ9A69F=BH<CIG5B8G 

| CIBH9FD5FHM7F98=HEI5@=HM |      |
|--------------------------|------|
| CF<=;<9F                 | <br> |
| HC                       | <br> |
| CF@CK9F<br>              | <br> |
| 0BF5H98<br>              | <br> |
| /CH5@                    | <br> |

 /<9CAD5BM IH=@=N9G=BH9FB5@ 7F98=H F5H=B;G 89H9FA=B98 6M=HG-=G?(5B5;9A9BH 89D5FHA9BHF98=H F5H=B;G 89H9FA=B98 6M -=G? (5B5;9A9BH IG9 A9H<C8C@C;=9G H<5H DFC8I79 F5H=B;G ;9B9F5@@M 7CBG=GH9BH K=H< H<CG9 DFC8I7986M9LH9FB5@F5H=B;5;9B7=9G

**>216@%6?7**R%BH<9BCFA5@7CIFG9C:6IG=B9GGH<9CAD5BM=G=BJC@J98=BH<99L97IH=CBG9HH@9A9BH 5B8:=B5B7=B;C:J5F=CIG7IGHCA9F5B8DF=B7=D5@G97IF=H=9GHF5BG57H=CBGIGHCA9F57H=J=H=9G5F9HF5BG57H98 CB 5 75G< A5F;=B CF 89@=J9FM
J9FGIG
D5MA9BH 65G=G .97IF=H=9G HF5BG57H=CBG 5F9 GI6>97H HC H<9 F=G? C: 7CIBH9FD5FHM CF 7IGHCA9F BCBD9F:CFA5B79 /F5BG57H=CBG 5F9 7C@@5H9F5@=N98 6M H<9 IB89F@M=B; G97IF=HM H<9F96M F98I7=B; H<9 5GGC7=5H98 F=G? HC 7<5B;9G =B H<9 A5F?9H J5@I9 C: H<9 G97IF=HM H<FCI;< G9HH@9A9BH 85H9

/<9CAD5BMG99?GHC7CBHFC@H<9F=G?5GGC7=5H98K=H<H<9G9HF5BG57H=CBG6M9GH56@=G<=B;5B8ACB=HCF=B; 7F98=H @=A=HG 5B8 6M ACB=HCF=B; 7C@@5H9F5@ 5B8 HF5BG57H=CB @9J9@G 85=@M /<9 CAD5BM A5M F9EI=F9 7CIBH9FD5FH=9GHC89DCG=H588=H=CB5@7C@@5H9F5@CF F9HIFB7C@@5H9F5@D@98;98 %BH<975G9C:5;98 G97IF=H=9G :5=@98HCF979=J9H<9CAD5BMA5MIB89F=B8IGHFMF9;I@5H=CBGDIF7<5G9H<9IB89F@M=B;G97IF=H=9G=BH<9 A5F?9H5B8G99?F9=A6IFG9A9BH:CF5BM@CGG9G:FCAH<97CIBH9FD5FHM

{26}------------------------------------------------

#### NOTES TO CONSOLIDATED STATEMENT OF FINANCIAL CONDITION - CONTINUED NOVEMBER 30, 2023

Concentration of Credit Risk - As a securities firm, the Company's activities are executed primarily with and on behalf of other financial institutions, including brokers and dealers, banks and other institutional customers. Concentrations of credit risk can be affected by changes in economic, industry or geographical factors. The Company seeks to control its credit risk and the potential risk concentration through a variety of reporting and control procedures, including those described in the preceding discussion of credit risk.

#### 6. COLLATERALIZED TRANSACTIONS

The Company's repurchase agreements and securities borrowing and lending arrangements are generally recorded at cost in the Consolidated Statement of Financial Condition, which is a reasonable approximation of their fair values due to their short-term nature. The Company enters into secured borrowing and lending arrangements to obtain collateral necessary to effect settlement, finance inventory positions, meet customer needs or re-lend as part of its dealer operations. The Company monitors its exposure to credit risk associated with these transactions by entering into master netting agreements. The Company monitors the fair value of the securities loaned and borrowed on a daily basis as compared with the related payable or receivable, and requests additional collateral or returns excess collateral, as appropriate. The Company pledges financial instruments as collateral under repurchase agreements, securities lending agreements and other secured arrangements, including clearing arrangements. The agreements with counterparties generally contain contractual provisions allowing the counterparty the right to sell or repledge the collateral. Pledged securities owned that can be sold or repledged by the counterparty are included in Financial instruments owned, at fair value and noted as Securities pledged in the Consolidated Statement of Financial Condition.

{27}------------------------------------------------

#### **!"'&'""!&"'&'' !'"!!"!'"!"!'!( !") %**

/<9:C@@CK=B;H56@9GG9H:CFH<H<9;FCGG75FFM=B;J5@I9C:G97IF=H=9G@9B8=B;5FF5B;9A9BHG5B8F9DIF7<5G9 5;F99A9BHG6M7@5GGC:7C@@5H9F5@D@98;985B8 F9A5=B=B;7CBHF57HI5@A5HIF=HM5H)CJ9A69F =B H<CIG5B8G 

|                                          | .97IF=H=9G<br>'9B8=B;<br>FF5B;9A9BHG | -9DIF7<5G9<br>;F99A9BHG | *6@=;5H=CBHC<br>-9HIFB<br>.97IF=H=9G<br>-979=J985G<br>C@@5H9F5@5H<br>"5=F15@I9 |   | /CH5@ |
|------------------------------------------|--------------------------------------|-------------------------|---------------------------------------------------------------------------------|---|-------|
| C@@5H9F5@+@98;98                         |                                      |                         |                                                                                 |   |       |
| CFDCF5H99EI=HMG97IF=H=9G                 | <br>                                 | <br>                    |                                                                                 | R | <br>  |
| CFDCF5H9896HG97IF=H=9G                   | <br>                                 | <br>                    |                                                                                 | R | <br>  |
| (CFH;5;9 657?985B85GG9H 657?98G97IF=H=9G | <br>R                                | <br>                    |                                                                                 | R | <br>  |
| 0.;CJ9FBA9BH5B8:989F5@5;9B7MG97IF=H=9G   | <br>                                 | <br>                    |                                                                                 |   | <br>  |
| (IB=7=D5@G97IF=H=9G                      | <br>R                                | <br>                    |                                                                                 | R | <br>  |
| .CJ9F9=;BC6@=;5H=CBG                     | <br>R                                | <br>                    |                                                                                 | R | <br>  |
| /CH5@                                    | <br>                                 |                         |                                                                                 |   |       |

|                                                                      | CBHF57HI5@(5HIF=HM |                           |          |   |     |   |                    |   |  |       |
|----------------------------------------------------------------------|--------------------|---------------------------|----------|---|-----|---|--------------------|---|--|-------|
|                                                                      |                    | *J9FB=;<H5B8<br>CBH=BICIG | 0DHC 5MG |   | 5MG |   | #F95H9FH<5B<br>5MG |   |  | /CH5@ |
| .97IF=H=9G@9B8=B;<br>5FF5B;9A9BHG                                    |                    |                           |          | R |     |   |                    |   |  |       |
| -9DIF7<5G95;F99A9BHG                                                 |                    |                           |          |   |     |   |                    |   |  |       |
| *6@=;5H=CBHCF9HIFBG97IF=H=9G<br>F979=J985G7C@@5H9F5@5H<br>:5=FJ5@I9 |                    |                           |          | R |     | R |                    | R |  |       |
| /CH5@                                                                |                    |                           |          |   |     |   |                    |   |  |       |

/<9CAD5BMF979=J9GG97IF=H=9G5G7C@@5H9F5@IB89FF9G5@95;F99A9BHGG97IF=H=9G6CFFCK=B;HF5BG57H=CBG 7IGHCA9F A5F;=B @C5BG 5B8 =B 7CBB97H=CB K=H< G97IF=H=9G
:CF
G97IF=H=9G HF5BG57H=CBG =B K<=7< =H =G H<9 @9B89F C: G97IF=H=9G %B A5BM =BGH5B79G H<9 CAD5BM =G D9FA=HH98 6M 7CBHF57H HC F9<MDCH<975H9 H<9 G97IF=H=9GF979=J985G7C@@5H9F5@/<9G9G97IF=H=9GA5M69IG98HCG97IF9F9DIF7<5G95;F99A9BHG9BH9F=BHC G97IF=H=9G @9B8=B; HF5BG57H=CBG G5H=G:M A5F;=B F9EI=F9A9BHG CB 89F=J5H=J9 HF5BG57H=CBG CF 7CJ9F G<CFH DCG=H=CBGH)CJ9A69F  H<95DDFCL=A5H9 :5=F J5@I9 C:G97IF=H=9G F979=J985G7C@@5H9F5@ 6MH<9 CAD5BMH<5HA5M69GC@8CFF9D@98;986MH<9CAD5BMK5G5DDFCL=A5H9@M6=@@=CBH)CJ9A69F 5GI6GH5BH=5@DCFH=CBC:H<9G97IF=H=9GF979=J986MH<9CAD5BM<58699BGC@8CFF9D@98;98

#### *())#\$\*')(###'"#)(*

/CA5B5;9H<9CAD5BMUG9LDCGIF9HC7F98=HF=G?5GGC7=5H98K=H<G97IF=H=9G:=B5B7=B;HF5BG57H=CBG=HA5M 9BH9F =BHC A5GH9F B9HH=B; 5;F99A9BHG 5B8 7C@@5H9F5@ 5FF5B;9A9BHG K=H< 7CIBH9FD5FH=9G #9B9F5@@M HF5BG57H=CBG 5F9 9L97IH98 IB89F GH5B85F8 =B8IGHFM 5;F99A9BHG =B7@I8=B; 6IH BCH @=A=H98 HC A5GH9F G97IF=H=9G @9B8=B; 5;F99A9BHG G97IF=H=9G @9B8=B; HF5BG57H=CBG 5B8 A5GH9F F9DIF7<5G9 5;F99A9BHG F9DIF7<5G9 HF5BG57H=CBG .99 )CH9  .=;B=:=75BH 77CIBH=B; +C@=7=9G :CF 588=H=CB5@ =B:CFA5H=CB F9;5F8=B;H<9C::G9HH=B;C:G97IF=H=9G:=B5B7=B;5;F99A9BHG

{28}------------------------------------------------

#### NOTES TO CONSOLIDATED STATEMENT OF FINANCIAL CONDITION - CONTINUED NOVEMBER 30, 2023

The following table provides information regarding repurchase agreements and securities borrowing and lending arrangements that are recognized in the Consolidated Statement of Financial Condition and (1) the extent to which, under enforceable master netting arrangements, such balances are presented net in the Consolidated Statement of Financial Condition as appropriate under U.S. GAAP and (2) the extent to which other rights of setoff associated with these arrangements exist and could have an effect on the Company's financial position (in thousands):

|                                                                             | November 30, 2023 |                                                                      |                                                                             |                                                      |                                             |                                     |  |  |  |  |
|-----------------------------------------------------------------------------|-------------------|----------------------------------------------------------------------|-----------------------------------------------------------------------------|------------------------------------------------------|---------------------------------------------|-------------------------------------|--|--|--|--|
|                                                                             | Gross<br>Amounts  | Netting in<br>Consolidated<br>Statement of<br>Financial<br>Condition | Net Amounts<br>11<br>Consolidated<br>Statement of<br>Financial<br>Condition | Additional<br>Amounts<br>Available for<br>Setoff (1) | Available                                   | Collateral (2)       Net Amount (3) |  |  |  |  |
| Assets                                                                      |                   |                                                                      |                                                                             |                                                      |                                             |                                     |  |  |  |  |
| Securities borrowing<br>arrangements  \$ 6,804,521                          |                   | ಕೆ                                                                   |                                                                             |                                                      | \$ 6,804,521 \$ (475,575) \$ (1,394,421) \$ | 4,934,525                           |  |  |  |  |
| Reverse repurchase<br>agreements                                            | 9,199,195         | (7,370,364)                                                          | 1,828,831                                                                   | (264,231)                                            | (1,538,208)                                 | 26,392                              |  |  |  |  |
| Securities received as collateral,<br>at fair value                         | 3,429             |                                                                      | 3,429                                                                       |                                                      | (3,429)                                     |                                     |  |  |  |  |
| Liabilities                                                                 |                   |                                                                      |                                                                             |                                                      |                                             |                                     |  |  |  |  |
| Securities lending<br>arrangements  \$ 1,413,330 .                          |                   | ਦਿੱਤੇ                                                                | \$ 1,413,330                                                                | \$ (475,575) \$                                      | (912,515)   \$                              | 25,240                              |  |  |  |  |
| Repurchase agreements  . 14,542,720                                         |                   | (7,370,364)                                                          | 7,172,356                                                                   | (264,231)                                            | (6,321,289)                                 | 586,836                             |  |  |  |  |
| Obligation to return securities<br>received as collateral, at fair<br>value | 3.429             |                                                                      | 3.429                                                                       |                                                      | (3.429)                                     |                                     |  |  |  |  |

(1) Under master netting agreements with its counterparties, the Company has the legal right of offset with a counterparty, which incorporates all of the counterparty's outstanding rights and obligations under the arrangement. These balances reflect additional credit risk mitigation that is available by a counterparty in the event of a counterparty's default, but which are not netted in the balance sheet because other netting provisions of U.S. GAAP are not met.

(2) Includes securities received or paid under collateral arrangements that could be liquidated in the event of a counterparty default and thus offset against a counterparty's rights and obligations under the resurchase agreements or securities borrowing or lending arrangements.

(3) Amounts include \$4.88 billion of securities borrowing arrangements, for which the Company has received securities collateral of \$4.76 billion, and \$0.51 billion of repurchase agreements, for which the Company has pledged securities collateral of \$0.52 billion, which are subject to master netting agreements but the Company has not determined the agreements to be legally enforceable.

#### 7. SECURITIZATION ACTIVITIES

The Company engages in securitization activities related to mortgage-backed and other asset-backed securities. In its securitization activities, the Company transfers these assets to special purpose entities ("SPEs") and acts as the placement or structuring agent for the beneficial interests sold to investors by the SPE. A significant portion of the securitization transactions are the securitization of assets issued or guaranteed by U.S. government agencies. These SPEs generally meet the criteria of VIEs; however, the Company generally does not consolidate the SPEs as it is not considered the primary beneficiary for these SPEs. See Note 8, Variable Interest Entities for further discussion on VIEs and the determination of the primary beneficiary.

The Company accounts for its securitization transactions as sales, provided it has relinquished control over the transferred assets. The Company generally receives cash proceeds in connection with the transfer

{29}------------------------------------------------

#### NOTES TO CONSOLIDATED STATEMENT OF FINANCIAL CONDITION - CONTINUED NOVEMBER 30, 2023

of assets to an SPE. The Company may, however, have continuing involvement with the transferred assets, which is limited to retaining one or more tranches of the securitization (primarily senior and subordinated debt securities in the form of mortgage-backed and other-asset backed securities). These securities are included in Financial instruments owned, at fair value in the Consolidated Statement of Financial Condition and are generally initially categorized as Level 2 within the fair value hierarchy. For further information on fair value measurements and the fair value hierarchy, refer to Note 2, Significant Accounting Policies and Note 4, Fair Value Disclosures.

The following table presents activity related to the Company's securitizations that were accounted for as sales in which it had continuing involvement (in millions):

|                                           |  | Year Ended<br>November 30, 2023 |
|-------------------------------------------|--|---------------------------------|
| Transferred assets                        |  | 5.604.6                         |
| Proceeds on new securitizations.          |  | 5 580 7                         |
| Cash flows received on retained interests |  | રી તે                           |

The Company has no explicit or implicit arrangements to provide additional financial support to these SPEs, has no liabilities related to these SPEs and does not have any outstanding derivative contracts executed in connection with these securitization activities at November 30, 2023.

The following table summarizes the Company's retained interests in SPEs where the Company has transferred assets and has continuing involvement and received sale accounting treatment (in millions):

|                             |  |              | November 30, 2023  |      |  |
|-----------------------------|--|--------------|--------------------|------|--|
| Securitization Type         |  | Total Assets | Retained Interests |      |  |
| U.S. government agency RMBS |  | 5,595.1 S    |                    | 4173 |  |
| U.S. government agency CMBS |  | 3,014.3      |                    | 1973 |  |

Total assets represent the unpaid principal amount of assets in the SPEs in which the Company has continuing involvement and are presented solely to provide information regarding the size of the transactions and the size of the underlying assets supporting the Company's retained interests, and are not considered representative of the risk of potential loss. Assets retained in connection with a securitization transaction represent the fair value of the securities of one or more tranches issued by an SPE, including senior and subordinated tranches. The Company's risk of loss is limited to this fair value amount which is included in total Financial instruments owned in the Consolidated Statement of Financial Condition.

Although not obligated, in connection with secondary market-making activities the Company may make a market in the securities issued by these SPEs. In these market-making transactions, the Company buys the securities from and sells these securities to investors. Securities purchased through these market-making activities are not considered to be continuing involvement in these SPEs, to the extent the Company purchased securities through these market-making activities and the Company is not deemed to be the primary beneficiary of the VIE, these securities are included in agency and non-agency mortgage-backed and asset-backed securitizations in the nonconsolidated VIEs section presented in Note 8, Variable Interest Entities.

{30}------------------------------------------------

#### NOTES TO CONSOLIDATED STATEMENT OF FINANCIAL CONDITION - CONTINUED NOVEMBER 30, 2023

## 8. VARIABLE INTEREST ENTITIES

VIEs are entities in which equity investors lack the characteristics of a controlling financial interest. VIEs are consolidated by the primary beneficiary. The primary beneficiary is the party who has both (1) the power to direct the activities of a VIE that most significantly impact the entity's economic performance and (2) an obligation to absorb losses of the entity or a right to receive benefits from the entity that could potentially be significant to the entity.

The Company's involvement with VIEs arises primarily from:

- · Purchases of securities in connection with the Company's trading and secondary market making activities:
- · Retained interests held as a result of securitization activities;
- · Acting as placement agent and/or underwriter in connection with client-sponsored securitizations;
- · Financing of agency and non-agency mortgage-backed and other asset-backed securities; and
- · Investments in various investment vehicles.

The Company determines whether it is the primary beneficiary of a VIE upon its initial involvement with the VIE and the Company reasses whether it is the primary beneficiary of a VIE on an ongoing basis. The Company's determination of whether it is the primary beneficiary of a VIE is based upon the facts and circumstances for each VIE and requires judgment. The Company's considerations in determining the VIE's most significant activities and whether it has power to direct those activities include, but are not limited to, the VIE's purpose and design and the risks passed through to investors, the voting interests of the VIE, management, service and/or other agreements of the VIE, involvement in the VIE's initial design and the existence of explicit or implicit financial guarantees. In situations where the Company has determined that the power over the VIE's significant activities is shared, the Company assesses whether it is the party with the power over the most significant activities. If the Company is the party with the power over the most significant activities, it meets the "power" criteria of the primary beneficiary. If the Company does not have the power over the most sigmificant activities or it determines that decisions require consent of each sharing party, the Company does not meet the "power" criteria of the primary beneficiary.

The Company assesses its variable interests in a VIE both individually and in aggregate to determine whether it has an obligation to absorb losses of or a right to receive benefits from the VIE that could potentially be significant to the VIE. The determination of whether the Company's variable interest is significant to the VIE requires judgment. In determining the significance of the Company's variable interest, it considers the terms, characteristics and size of the variable interests, the design and characteristics of the VIE, its involvement in the VIE and its market-making activities related to the variable interests.

#### Consolidated VIEs

The following table presents information about the Company's consolidated VIEs at November 30, 2023 (in millions). The assets and liabilities in the tables below are presented prior to consolidation and thus a portion of these assets and liabilities are eliminated in consolidation.

{31}------------------------------------------------

#### **!"'&'""!&"'&'' !'"!!"!'"!"!'!( !") %**

|                                            | .97IF98"IB8=B;<br>19<=7@9G |
|--------------------------------------------|----------------------------|
| .97IF=H=9GDIF7<5G98IB89F5;F99A9BHGHCF9G9@@ | <br>                       |
| /CH5@5GG9HG                                | <br>                       |
| *H<9FG97IF98:=B5B7=B;G                     | <br>                       |
| *H<9F@=56=@=H=9G                           | <br>                       |
| /CH5@@=56=@=H=9G                           | <br>                       |

 .97IF=H=9G DIF7<5G98 IB89F 5;F99A9BHG HC F9G9@@ F9DF9G9BH 5ACIBHG 8I9 IB89F 7C@@5H9F5@=N98 HF5BG57H=CBG CB F9@5H987CBGC@=85H989BH=H=9GK<=7<5F99@=A=B5H98=B7CBGC@=85H=CB

*\*'\*##!(*/<9CAD5BM=GH<9DF=A5FM69B9:=7=5FMC:5GG9H
657?98:=B5B7=B;J9<=7@9GHC K<=7<=HG9@@GG97IF=H=9GDIFGI5BHHCH<9H9FAGC:5A5GH9FF9DIF7<5G95;F99A9BH/<9CAD5BMUGJ5F=56@9 =BH9F9GHG =B H<9G9 J9<=7@9G 7CBG=GH C: =HG 7C@@5H9F5@ A5F;=B A5=BH9B5B79 C6@=;5H=CBG IB89F H<9 A5GH9F F9DIF7<5G95;F99A9BHK<=7<H<9CAD5BMA5B5;9G5B8F9H5=B98=BH9F9GHG=BG97IF=H=9G=GGI98/<95GG9HG C: H<9G9 1%!G 7CBG=GH C: F9J9FG9 F9DIF7<5G9 5;F99A9BHG K<=7< 5F9 5J5=@56@9 :CF H<9 69B9:=H C: H<9 J9<=7@9UG896H<C@89FG

#### *! ! %!&%*

/<9:C@@CK=B;H56@9DF9G9BHG=B:CFA5H=CB56CIHH<9CAD5BMUGJ5F=56@9=BH9F9GHG=BBCB7CBGC@=85H981%!G =BA=@@=CBG 

|                           | )CJ9A69F     |  |             |   |      |                       |          |  |  |
|---------------------------|--------------|--|-------------|---|------|-----------------------|----------|--|--|
|                           | 5FFM=B;ACIBH |  |             |   |      | (5L=AIA<br>!LDCGIF9HC |          |  |  |
|                           | GG9HG        |  | '=56=@=H=9G |   | 'CGG |                       | 1%!GG9HG |  |  |
| '*G                       |              |  |             | R |      |                       |          |  |  |
| *H<9F5GG9H 657?98J9<=7@9G |              |  |             | R |      |                       |          |  |  |
| %BJ9GHA9BHJ9<=7@9G        |              |  |             | R |      |                       |          |  |  |
| /CH5@                     |              |  |             | R |      |                       |          |  |  |

/<9CAD5BMUGA5L=AIA9LDCGIF9HC@CGGC:H9B8=::9FG:FCAH<975FFM=B;J5@I9C:H<9J5F=56@9=BH9F9GHG /<9 A5L=AIA 9LDCGIF9 HC @CGG =G 89D9B89BH CB H<9 B5HIF9 C: H<9CAD5BMUG J5F=56@9 =BH9F9GHG =B H<9 1%!G 5B8 =G @=A=H98 HC H<9 BCH=CB5@ 5ACIBHG C: 79FH5=B F9A5=B=B; 7CAA=HA9BHG /<9 CAD5BMUG A5L=AIA9LDCGIF9HC@CGG8C9GBCH=B7@I89H<9C::G9HH=B;69B9:=HC:5BM:=B5B7=5@=BGHFIA9BHGH<5HA5M69 IH=@=N98 HC <98;9 H<9 F=G?G 5GGC7=5H98 K=H< H<9 CAD5BMUG J5F=56@9 =BH9F9GHG 5B8 =G BCH F98I798 6M H<9 5ACIBHC:7C@@5H9F5@<9@85GD5FHC:5HF5BG57H=CBK=H<51%!

*(* GG9HG 7C@@5H9F5@=N=B; H<9 '\*G =B7@I89 65B? @C5BG D5FH=7=D5H=CB =BH9F9GHG 5B8 GI6
=BJ9GHA9BH ;F5895B8G9B=CFG97IF980.@C5BG/<9CAD5BMIB89FKF=H9GG97IF=H=9G=GGI98=B'\*HF5BG57H=CBGCB 69<5@:C:GDCBGCFG5B8DFCJ=89G58J=GCFMG9FJ=79GHCH<9GDCBGCFG%HGJ5F=56@9=BH9F9GHG=B7CBB97H=CBK=H< '\*GK<9F9=H <5G 699B=BJC@J98=B DFCJ=8=B; IB89FKF=H=B;5B8CF58J=GCFM G9FJ=79G7CBG=GH C:HF58=B; DCG=H=CBG=BG97IF=H=9G=GGI98=B5'\*HF5BG57H=CB

*)' (() !(* /<9 CAD5BM CKBG G97IF=H=9G =GGI98 6M H<9 J9<=7@9G C: K<=7< H<9 IB89F@M=B;5GG9HG7C@@5H9F5@=N=B;H<9J9<=7@9G5F9DF=A5F=@M7CADF=G98C:IBG97IF987CBGIA9F=BGH5@@A9BH @C5BG /<9 CAD5BM A5M DFCJ=89 GHFI7HIF=B; 5B8 58J=GCFM G9FJ=79G 5B8 57H 5G 5B IB89FKF=H9F CF D@579A9BH 5;9BH :CF G97IF=H=9G =GGI98 6M H<9 J9<=7@9G /<9 CAD5BM 8C9G BCH 7CBHFC@ H<9 57H=J=H=9G C: H<9G99BH=H=9G

*#+()"#)!(*/<9CAD5BM<589EI=HM7CAA=HA9BHGHC=BJ9GHA=@@=CB=BJ5F=CIG=BJ9GHA9BH J9<=7@9G C: K<=7< H<9 9BH=F9 5ACIBH K5G :IB898 /<9 75FFM=B; J5@I9 C: H<9 CAD5BMUG 9EI=HM

{32}------------------------------------------------

#### NOTES TO CONSOLIDATED STATEMENT OF FINANCIAL CONDITION - CONTINUED NOVEMBER 30, 2023

investments was \$24.7 million. The Company's exposure to limited to its carrying value and unfunded commitments. These private investment vehicles have assets primarily consisting of private and public equity investments, debt instruments and various oil and gas assets.

Mortgage-Backed and Other Asset-Backed Secured Funding Vehicles. In connection with the Company's secondary trading and market making activities, the Company buys and sells agency and non-agency mortgage-backed securities and other asset-backed securities, which are issued by third-party securitization SPEs and are generally considered variable interests in VIEs. Securities issued by securitization SPEs are backed by residential mortgage loans, U.S. agency collateralized mortgage obligations, commercial mortgage loans, CDOs and CLOs and other consumer loans, such as installment receivables, auto loans and student loans. These securities are accounted for at fair value and included in Financial instruments owned in the Consolidated Statement of Financial Condition. The Company has no other involvement with the related SPEs and therefore does not consolidate these entities.

The Company also engages in underwriting, placement and structuring activities for third-party-sponsored securitization trusts generally through agency (FNMA ("Fannie Mae"), Federal Home Loan Mortgage Corporation ("Freddie Mac") or GNMA ("Ginnie Mae")) or non-agency-sponsored SPEs and may purchase loans or mortgage-backed securities from third parties that are subsequently transferred into the securitization trusts. The securitizations are backed by residential and commercial mortgage, home equity and auto loans. The Company does not consolidate agency sponsored securitizations as it does not have the power to direct the activities of the SPEs that most significantly impact their economic performance. Further, the Company is not the servicer of non-agency-sponsored securitizations and therefore does not have power to direct the most significant activities of the SPEs and accordingly, does not consolidate these entities. The Company may retain unsold senior and/or subordinated interests at the time of securitization in the form of securities issued by the SPEs.

At November 30, 2023, the Company held \$1,885.7 million of agency mortgage-backed securities and \$8.3 million of non-agency mortgage-backed and other asset-backed securities as a result of its secondary trading and market making activities, and underwriting, placement and structuring activities and resecuritization activities. The Company's maximum exposure to loss on these securities is limited to the carrying value of its investments in these securities. These mortgage-backed and other asset-backed secured funding vehicles discussed are not included in the above table containing information about the Company's variable interests in nonconsolidated VIEs.

## 9. RECEIVABLES FROM, AND PAYABLES TO, BROKERS, DEALERS AND CLEARING ORGANIZATIONS

The following is a summary of the major categories of receivables from, and payables to, brokers, dealers and clearing organizations at November 30, 2023 (in thousands):

|                                      | Receivables | Payables |  |           |
|--------------------------------------|-------------|----------|--|-----------|
| Trades in process of settlement, net |             |          |  | 712,646   |
| Margin                               |             | 52,523   |  | 81,863    |
| Securities failed to deliver/receive |             | 289,804  |  | 197,017   |
| Clearing organizations               |             | 33,017   |  | 7,003     |
| ( )ther                              |             | 106,689  |  | 17,588    |
| <br>Total                            |             | 482,033  |  | 1,016,117 |

{33}------------------------------------------------

#### NOTES TO CONSOLIDATED STATEMENT OF FINANCIAL CONDITION - CONTINUED NOVEMBER 30, 2023

#### 10. GOODWILL AND INTANGIBLE ASSETS

#### Goodwill Impairment Testing

At November 30, 2023, goodwill was \$1,356.7 million. The Company's annual goodwill impairment testing at August 1, 2023 did not indicate any goodwill impairment. Adverse market or economic events could result in impairment charges in future periods. Estimating the fair value of the Company requires management judgment. The estimated fair value of the Company was determined using a market valuation method that incorporates price-to-earnings and price-to-book multiples of comparable public companies. Under the market valuation approach, the key assumptions are the selected multiples and the Company's internally developed projections of future profitability, growth and return on equity. In addition, as the fair values determined under the market valuation approach represent a noncontrolling interest, the Company applied a control premium to arrive at the estimated fair value on a controlling basis.

#### Intangible Assets

Intangible assets are included in Other assets in the Consolidated Statement of Financial Condition. The following table presents the gross carrying amount, changes in carrying amount, net carrying amount and weighted average amortization period of identifiable intangible assets at November 30, 2023 (in thousands):

|                                                                | Gross cost |         |      | Impairment<br>losses | Accumulated<br>amortizatıon |              |        | Net carrying<br>amount | Weighted<br>average<br>remaining<br>lives (years) |  |  |
|----------------------------------------------------------------|------------|---------|------|----------------------|-----------------------------|--------------|--------|------------------------|---------------------------------------------------|--|--|
| Customer relationships  \$ 115,188                             |            |         | ਦਿੱਤ |                      | ಕ್ಕಿ                        | (84,563)     | ಕ್ಕೆ ಕ | 30,625                 | 7.3                                               |  |  |
| Trademarks and trade names                                     |            | 100,238 |      |                      |                             | (30,787)     |        | 69,451                 | 24.3                                              |  |  |
| Exchange and clearing organization<br>membership interests and |            | 3,477   |      | (8)                  |                             |              |        | 3,469                  | N/A                                               |  |  |
| Total                                                          |            | 218.903 |      | (8)                  |                             | \$ (115,350) | و      | 103,545                |                                                   |  |  |

The Company performed its annual impairment testing of intangible assets with an indefinite useful life, which consists of exchange and clearing organization membership interests and registrations, at August 1, 2023. The Company elected to perform quantitative assessments of membership interests and registrations that have available quoted sales prices as well as certain other membership interests and registrations that have declined in utilization and qualitative assessments were performed on the remainder of the indefinite-life intangible assets. With regard to the qualitative assessments of the remaining indefinite-life intangible assets, based on the Company's assessment of market conditions, the utilization of the assets and the replacement costs associated with the assets, the Company has concluded that it is not more likely than not that the intangible assets are impaired.

{34}------------------------------------------------

#### NOTES TO CONSOLIDATED STATEMENT OF FINANCIAL CONDITION - CONTINUED NOVEMBER 30, 2023

#### 11. SHORT-TERM BORROWINGS AND CREDIT FACILITIES

Short-term borrowings consist of bank loans that are payable on demand and generally bear interest at spreads over the federal funds rate. Bank loans at November 30, 2023 totaled \$930.0 million. At November 30, 2023, the weighted average interest rate on short-term borrowings outstanding was 6.05% per annum. The Company's Short-term borrowings are recorded at cost in the Consolidated Statement of Financial Condition, which is a reasonable approximation of their liquid and shortterm nature.

At November 30, 2023, the Company's bank loans primarily include facilities that contain certain covenants that, among other things, require the Company to maintain a specified level of tangible net worth and minimum regulatory net capital and impose certain restrictions on the future indebtedness of the Company. At November 30, 2023, the Company was in compliance with all covenants under these facilities. Interest on these facilities is based on rates at spreads over the federal funds rate or other adjusted rates, as defined in the credit agreements.

#### 12. LIABILITIES SUBORDINATED TO CLAIMS OF GENERAL CREDITORS

At November 30, 2023, the Company has outstanding borrowings of \$3,550.0 million in aggregate, from the Parent under subordinated loan agreements. The subordinated loan agreements consist of the following (in millions):

|                                                     | Outstanding<br>Amount | Maturity       |  |  |
|-----------------------------------------------------|-----------------------|----------------|--|--|
|                                                     |                       |                |  |  |
| Cash subordinated loan agreement (1)                | 1,950.0               | April 30, 2025 |  |  |
| Cash subordinated loan agreement (2)                | 1,000.0               | June 30, 2027  |  |  |
| Revolving note and cash subordination agreement (3) | 300.0                 | April 30, 2025 |  |  |
| Revolving note and cash subordination agreement (4) | 300.0                 | May 31, 2028   |  |  |
| Total                                               | 3,550.0               |                |  |  |

- (1) This agreement had an initial six year term; bears interest at a rate of 7.5% per annum and automatically extends for additional one year periods, unless specified actions are taken prior to the maturity date by the Company or Parent.
- (2) This agreement had an initial six year term; bears interest at a rate of 3.25% per annum and automatically extends for additional one year periods, unless specified actions are taken prior to the maturity date by the Company or Parent.
- (3) The Company has a ten year, \$300.0 million revolving note and cash subordination agreement and automatically extends for additional one year periods, unless specified actions are taken prior to the maturity date by the Company or Parent. Amounts borrowed under this agreement bear interest at a rate agreed at the time of the advance and are to be repaid in full by April 30, 2025.
- (4) The Company has a ten year, \$500.0 million revolving note and cash subordination agreement. Amounts borrowed under this agreement bear interest at a rate agreed at the advance and are to be repaid in full by May 31, 2028.

Amounts borrowed by the Company under the subordinated loan agreements have been approved by FINRA and the NFA, and therefore, qualify as capital in computing net capital under Rule 15c3-1 (Net Capital). To the extent that such borrowings are required for the Company's continued compliance with minimum net capital requirements, they may not be repaid.

{35}------------------------------------------------

#### **!"'&'""!&"'&'' !'"!!"!'"!"!'!( !") %**

\*B&5BI5FMH<9CAD5BM6CFFCK985B588=H=CB5@A=@@=CBIB89F=HGF9JC@J=B;BCH95B8 75G< GI6CF8=B5H=CB 5;F99A9BH A5HIF=B; CB DF=@  5B8 6CFFCK98 A=@@=CB IB89F =HG F9JC@J=B;BCH95B875G<GI6CF8=B5H=CB5;F99A9BHA5HIF=B;CB(5M

\*B.9DH9A69FH<9CAD5BM5;F998HC9LH9B8H<9A5HIF=HM85H9:CFH<9A=@@=CBF9JC@J=B; BCH95B875G<GI6CF8=B5H=CB5;F99A9BH:FCADF=@HCDF=@

\*B 979A69FH<9CAD5BM6CFFCK985B588=H=CB5@A=@@=CBIB89F=HGF9JC@J=B;BCH95B8 75G<GI6CF8=B5H=CB5;F99A9BHA5HIF=B;CB(5M

\*B &5BI5FM   H<9 CAD5BM 9BH9F98 =BHC 5 A=@@=CB IB8F5KB F9JC@J=B; BCH9 5B8 75G< GI6CF8=B5H=CB5;F99A9BHK=H<=HG+5F9BHA5HIF=B;CB&5BI5FM

#### **&&**

/<9 CAD5BM 9BH9FG =BHC @95G9 5B8 GI6@95G9 5;F99A9BHG DF=A5F=@M :CF C::=79 GD579 57FCGG @C75H=CBG K=H<=B H<9 0. %B:CFA5H=CB F9@5H98 HC CD9F5H=B; @95G9G =B H<9 CBGC@=85H98 .H5H9A9BH C: "=B5B7=5@ CB8=H=CB5H)CJ9A69FK5G5G:C@@CKG=BH<CIG5B8G9L79DH@95G9H9FA5B88=G7CIBHF5H9 

| +F9A=G9G5B89EI=DA9BH -*05GG9HG<br> |  |
|------------------------------------|--|
|                                    |  |
| 29=;<H985J9F5;9                    |  |
| -9A5=B=B;@95G9H9FA=BM95FG<br>      |  |
| =G7CIBHF5H9                        |  |

/<9 :C@@CK=B; H56@9 DF9G9BHG H<9 A5HIF=H=9G C: H<9 CAD5BMUG CD9F5H=B; @95G9 @=56=@=H=9G 5B8 5 F97CB7=@=5H=CBHCH<9 '95G9@=56=@=H=9G=B7@I898=BH<9 CBGC@=85H98 .H5H9A9BH C: "=B5B7=5@ CB8=H=CB 5H )CJ9A69F=BH<CIG5B8G 

| "=G75@395F                                                          | '95G9'=56=@=H=9G |
|---------------------------------------------------------------------|------------------|
| <br>                                                                | <br>             |
| <br>                                                                | <br>             |
| <br>                                                                | <br>             |
| <br>                                                                | <br>             |
| <br>                                                                | <br>             |
| 5B8H<9F95:H9F<br>                                                   | <br>             |
| /CH5@IB8=G7CIBH9875G<:@CKG                                          | <br>             |
| '9GG =::9F9B7969HK99BIB8=G7CIBH985B88=G7CIBH9875G<:@CKG             | <br>             |
| *D9F5H=B;@95G9G5ACIBH=BH<9CBGC@=85H98.H5H9A9BHC:"=B5B7=5@CB8=H=CB   | <br>             |
| "=B5B79@95G9G5ACIBH=BH<9CBGC@=85H98.H5H9A9BHC:"=B5B7=5@CB8=H=CB<br> | <br>             |
| /CH5@5ACIBH=BH<9CBGC@=85H98.H5H9A9BHC:"=B5B7=5@CB8=H=CB             | <br>             |

%B588=H=CBHCH<9H56@956CJ95GC:)CJ9A69FH<9CAD5BM9BH9F98=BHC5@95G95;F99A9BHH<5H K5GG=;B986IH<58BCHM9H7CAA9B798/<=GCD9F5H=B;@95G9K=@@7CAA9B79=BK=H<5@95G9H9FAC: M95FG

{36}------------------------------------------------

## TBBIBRIBS DOC

#### NOTES TO CONSOLIDATED STATEMENT OF FINANCIAL CONDITION - CONTINUED NOVEMBER 30, 2023

#### 14. CONTRACT BALANCES AND CONTRACT COSTS

#### Contract Balances

The timing of the Company's revenue recognition may differ from the timing of payment by the Company's customers. The Company records a receivable when revenue is recognized prior to payment and have an unconditional right to the payment. Alternatively, when payment precedes the provision of the related services, the Company records deferred revenue until the performance obligations are satisfied.

The Company's deferred revenue primarily relates to retainer and milestone fees received in investment banking advisory engagements where the performance obligation has not yet been satisfied. Deferred revenue at November 30, 2023 was \$1.9 million and was recorded in Accrued expenses and other liabilities in the Consolidated Statement of Financial Condition.

The Company had receivables related to revenues from contracts with customers of \$128.7 million at November 30, 2023. The Company estimates an allowance for credit losses on the Company's investment banking fee receivables using a provisioning matrix based on the sharacteristics and historical loss experience for such receivables. In some instances, the Company may adjust the allowance calculated based on the provision matrix to incorporate a specific allowance based on the unique credit risk profile of a receivable. The provisioning matrix is periodically updated to reflect changes in the underlying portfolio's credit characteristics and most recent historical loss data.

The allowance for credit losses at November 30, 2023 was \$6.0 million.

#### Contract Costs

The Company capitalizes costs to fulfill contracts associated with investment banking advisory engagements where the revenue is recognized at a point in time and the costs are determined to be recoverable. Capitalized costs to fulfill a contract are recognized at the point in time that the related revenue is recognized.

At November 30, 2023, capitalized costs to fulfill a contract were \$4.2 million, which are recorded in Receivables - Fees, interest and other in the Consolidated Statement of Financial Condition.

{37}------------------------------------------------

#### **!"'&'""!&"'&'' !'"!!"!'"!"!'!( !") %**

#### **" ' !'&!(%!'&**

#### *!& &%*

/<9:C@@CK=B;H56@9GIAA5F=N9GH<9CAD5BMUG7CAA=HA9BHG5H)CJ9A69F=BA=@@=CBG 

|                             |  | !LD97H98(5HIF=HM 5H9 |  |   |         |   |         |   |              |   |                   |      |
|-----------------------------|--|----------------------|--|---|---------|---|---------|---|--------------|---|-------------------|------|
|                             |  |                      |  |   | 5B8<br> |   | 5B8<br> |   | 5B8<br>'5H9F |   | (5L=AIA<br>+5MCIH |      |
| !EI=HM7CAA=HA9BHG           |  | R                    |  | R |         | R |         | R |              |   |                   |      |
| "CFK5F8GH5FH=B;F9J9FG9F9DCG |  |                      |  | R |         | R |         | R |              | R |                   |      |
| "CFK5F8GH5FH=B;F9DCG<br>    |  |                      |  | R |         | R |         | R |              | R |                   |      |
| /CH5@<br>                   |  |                      |  | R |         | R |         | R |              |   |                   | <br> |

 H)CJ9A69F5@@C:H<9:CFK5F8GH5FH=B;G97IF=H=9GDIF7<5G98IB89F5;F99A9BHGHCF9G9@@5B85@@C:H<9 :CFK5F8GH5FH=B;G97IF=H=9GGC@8IB89F5;F99A9BHGHCF9DIF7<5G9G9HH@9K=H<=BH<F996IG=B9GG85MG

 *&\*)-\$"")"#)(/*%B7@I89G7CAA=HA9BHGHC=BJ9GH=B5::=@=5H98DF=J5H99EI=HM:IB8G

*\$',')')#+'(%\$(#%\$(/*/<9CAD5BM9BH9FG=BHC7CAA=HA9BHGHCH5?9DCGG9GG=CB C:G97IF=H=9GK=H<5;F99A9BHGHCF9G9@@CB5:CFK5F8GH5FH=B;65G=G5B8HCG9@@G97IF=H=9GK=H<5;F99A9BHGHC F9DIF7<5G9 CB 5 :CFK5F8 GH5FH=B; 65G=G H<5H 5F9 DF=A5F=@M G97IF98 6M 0. ;CJ9FBA9BH 5B8 5;9B7M G97IF=H=9G

#### *'\$ &%*

 *'+)+ \$#)')( /* 9FH5=B 89F=J5H=J9 7CBHF57HG H<5H H<9 CAD5BM <5G 9BH9F98 =BHC A99H H<9 577CIBH=B; 89:=B=H=CB C: 5 ;I5F5BH99 IB89F 0. #+ \*B 79FH5=B C: H<9G9 7CBHF57HG GI7< 5G KF=HH9B 9EI=HM DIH CDH=CBG H<9 A5L=AIA D5MCIH CB H<9G9 7CBHF57HG 75BBCH 69 EI5BH=:=98 G=B79 H<9 =B7F95G9 =B 9EI=HMG97IF=HMDF=79G5F9BCH7CBHF57HI5@@M@=A=H986MH<9H9FAGC:H<97CBHF57HGGI7<H<9CAD5BM<5G 8=G7@CG98BCH=CB5@J5@I9G5G5A95GIF9C:H<9A5L=AIADCH9BH=5@D5MCIHIB89FH<9G97CBHF57HG

/<9:C@@CK=B;H56@9GIAA5F=N9GH<9BCH=CB5@5ACIBHG5GGC7=5H98K=H<H<9CAD5BMUG89F=J5H=J97CBHF57HG A99H=B;H<989:=B=H=CBC:5;I5F5BH99IB89F0.#+5H)CJ9A69F=BA=@@=CBG 

|                                          | !LD97H98(5HIF=HM 5H9 |  |  |  |  |         |  |         |              |                   |
|------------------------------------------|----------------------|--|--|--|--|---------|--|---------|--------------|-------------------|
| #I5F5BH99/MD9                            |                      |  |  |  |  | 5B8<br> |  | 5B8<br> | 5B8<br>'5H9F | /CH5@<br>)CH=CB5@ |
| 9F=J5H=J97CBHF57HG BCB 7F98=H<br>F9@5H98 |                      |  |  |  |  |         |  | R       | <br>R        |                   |

%H=GA5B5;9A9BHUG69@=9:H<5HBCH=CB5@5ACIBHG;9B9F5@@MCJ9FGH5H99LD97H98D5MCIH5B8H<5H:5=FJ5@I9C: H<9G97CBHF57HG=G5ACF9F9@9J5BHA95GIF9C:H<9CAD5BMUGC6@=;5H=CBGH)CJ9A69FH<9:5=F J5@I9 C: 89F=J5H=J97CBHF57HGA99H=B;H<9 89:=B=H=CB C:5 ;I5F5BH99=G5@=56=@=HM C:5DDFCL=A5H9@M A=@@=CB /<9 CAD5BM GI6GH5BH=5@@M A=H=;5H9G =HG 9LDCGIF9 HC A5F?9H F=G? CB H<9G9 7CBHF57HG H<FCI;< <98;9GGI7<5GCH<9F89F=J5H=J97CBHF57HG5B8CF75G<=BGHFIA9BHG/<9CAD5BMA5B5;9GF=G?5GGC7=5H98 K=H< 89F=J5H=J9 7CBHF57HG A99H=B; H<9 89:=B=H=CB C: 5 ;I5F5BH99 7CBG=GH9BH K=H< =HG F=G? A5B5;9A9BH DC@=7=9G

*)'\*'#)(/*/<9CAD5BM=G5A9A69FC:J5F=CIG9L7<5B;9G5B87@95F=B;<CIG9G%BH<9BCFA5@ 7CIFG9C:6IG=B9GGH<9CAD5BMDFCJ=89G;I5F5BH99GHCG97IF=H=9G7@95F=B;<CIG9G5B89L7<5B;9G/<9G9 ;I5F5BH99G ;9B9F5@@M 5F9 F9EI=F98 IB89F H<9 GH5B85F8 A9A69FG<=D 5;F99A9BHG GI7< H<5H A9A69FG 5F9

{38}------------------------------------------------

#### **!"'&'""!&"'&'' !'"!!"!'"!"!'!( !") %**

F9EI=F98HC;I5F5BH99H<9D9F:CFA5B79C:CH<9FA9A69FG88=H=CB5@@M=:5A9A69F697CA9GIB56@9HC G5H=G:M=HGC6@=;5H=CBGHCH<97@95F=B;<CIG9CH<9FA9A69FGKCI@869F9EI=F98HCA99HH<9G9G<CFH:5@@G/C A=H=;5H9 H<9G9 D9F:CFA5B79 F=G?G H<9 9L7<5B;9G 5B8 7@95F=B; <CIG9G C:H9B F9EI=F9 A9A69FG HC DCGH 7C@@5H9F5@/<9CAD5BMUGC6@=;5H=CBGIB89FGI7<;I5F5BH99G7CI@89L7998H<97C@@5H9F5@5ACIBHGDCGH98 /<9A5L=AIA DCH9BH=5@@=56=@=HM IB89FH<9G95FF5B;9A9BHG75BBCH 69 EI5BH=:=98 <CK9J9FH<9 DCH9BH=5@ :CFH<9CAD5BMHC69F9EI=F98HCA5?9D5MA9BHGIB89FGI7<;I5F5BH99G=G899A98F9ACH977CF8=B;@M BC @=56=@=HM <5G 699B F97C;B=N98 :CF H<9G9 ;I5F5BH99G 88=H=CB5@@M H<9 CAD5BM DFCJ=89G 79FH5=B =B89AB=:=75H=CBG =B 7CBB97H=CB K=H< H<=F8
D5FHM 7@95F=B; 5B8 9L97IH=CB 5FF5B;9A9BHG K<9F96M 5 H<=F8 D5FHM A5M 7@95F 5B8 G9HH@9 HF5BG57H=CBG CB 69<5@: C: 7@=9BHG /<9G9 =B89AB=:=75H=CBG ;9B9F5@@M <5J9 GH5B85F8 7CBHF57HI5@ H9FAG 5B8 5F9 9BH9F98 =BHC =B H<9 CF8=B5FM 7CIFG9 C: 6IG=B9GG /<9 CAD5BMUG C6@=;5H=CBG=BF9GD97HC:GI7<HF5BG57H=CBG5F9G97IF986MH<95GG9HG=BH<97@=9BHUG577CIBH5GK9@@5G5BM DFC7998G F979=J98 :FCA H<9 HF5BG57H=CBG 7@95F98 5B8 G9HH@98 CB 69<5@: C: H<9 7@=9BH \$CK9J9F H<9 CAD5BM69@=9J9GH<5H=H=GIB@=?9@MH<9CAD5BMKCI@8<5J9HCA5?95BMA5H9F=5@D5MA9BHGIB89FH<9G9 5FF5B;9A9BHG5B8BCA5H9F=5@@=56=@=H=9GF9@5H98HCH<9G9=B89AB=:=75H=CBG<5J9699BF97C;B=N98

{39}------------------------------------------------

#### **!"'&'""!&"'&'' !'"!!"!'"!"!'!( !") %**

#### **%'#%','%!&'"!&**

%BH<9CF8=B5FM7CIFG9C:6IG=B9GGH<9CAD5BMC6H5=BG58J5B79G :FCAH<9+5F9BHK<=7<5F9;9B9F5@@M D5M56@9 CB 89A5B8/<9CAD5BM DFCJ=89G J5F=CIGHF58=B; G97IF=H=9G@9B8=B;7@95F=B;9L97IH=CB5B8 58A=B=GHF5H=J9 G9FJ=79G HC GI6G=8=5F=9G C: H<9 +5F9BH /<9 +5F9BH G9HH@9G 79FH5=B C: H<9G9 65@5B79G K=H< 79FH5=BC:H<9CAD5BMUG5::=@=5H9G5B8GI6G=8=5F=9GCB69<5@:C:H<9CAD5BM

**'>.16:482.>.:02 .:1196:6?@>.@6B20@6B6@62?**R(5B5;9A9BH 69@=9J9G 5ACIBHG 5F=G=B;H<FCI;< F9@5H98D5FHMHF5BG57H=CBG5F9F95GCB56@95B85DDFCL=A5H95ACIBHGH<5HKCI@8<5J9699BF97CF898=:H<9 CAD5BM CD9F5H98 5G 5B IB5::=@=5H98 9BH=HM ACIBHG I9 HC 5B8 I9 :FCA 5::=@=5H9G 5F9 D9F=C8=75@@M G9HH@98=B 75G</<9CAD5BM <5G 9BH9F98=BHC 9LD9BG9 G<5F=B; 5;F99A9BHGK=H< GI6G=8=5F=9G 5B8 CH<9F 5::=@=5H9G C:H<9 +5F9BH 88=H=CB5@@MH<9CAD5BM <5G 9BH9F98=BHC 7@95F=B; 5B8 9L97IH=CB 5;F99A9BHG K=H< &9::9F=9G "=B5B7=5@ .9FJ=79G %B7 S&".%T  &9::9F=9G %BH9FB5H=CB5@ '=A=H98 S&%'T 5B8 &9::9F=9G #A6\$

5@5B79GK=H<F9@5H98D5FH=9GF9:@97H98=BH<9CBGC@=85H98.H5H9A9BHC:"=B5B7=5@CB8=H=CB5F9G9H:CFH< 69@CK=BH<CIG5B8G 

|                                                    | )CJ9A69F<br> |  |
|----------------------------------------------------|--------------|--|
| ??2@?                                              |              |  |
| .97IF=H=9G6CFFCK98                                 | <br>         |  |
| .97IF=H=9GDIF7<5G98IB89F5;F99A9BHGHCF9G9@@         | <br>         |  |
| -979=J56@9G FC?9FG895@9FG5B87@95F=B;CF;5B=N5H=CBG | <br>         |  |
| -979=J56@9G "99G=BH9F9GH5B8CH<9F<br>              | <br>         |  |
| -979=J56@9G  I9:FCA5::=@=5H9G                      | <br>         |  |
| 6./686@62?                                         |              |  |
| .97IF=H=9G@C5B98                                   | <br>         |  |
| .97IF=H=9GGC@8IB89F5;F99A9BHGHCF9DIF7<5G9          | <br>         |  |
| +5M56@9G FC?9FG895@9FG5B87@95F=B;CF;5B=N5H=CBG    | <br>         |  |
| +5M56@9G IGHCA9FG<br>                              | <br>         |  |
| +5M56@9G  I9HC+5F9BH5B85::=@=5H9G                  | <br>         |  |
| 77FI989LD9BG9G5B8CH<9F@=56=@=H=9G                  | <br>         |  |

**2/@&20A>6@62?;3@52#.>2:@**R%B7CBB97H=CBK=H<=HG75D=H5@A5F?9HG57H=J=H=9G:FCAH=A9HCH=A9H<9 CAD5BMA5?9G5A5F?9H=B@CB;
H9FA896HG97IF=H=9GC:H<9+5F9BH*-*H<9CAD5BM6IMG5B8G9@@G896H G97IF=H=9G =GGI98 6M =HG +5F9BH H )CJ9A69F   5DDFCL=A5H9@M A=@@=CB C: 896H G97IF=H=9G =GGI98 6M H<9 +5F9BH 5F9 =B7@I898 =B "=B5B7=5@ =BGHFIA9BHG CKB98 5H :5=F J5@I9 =B H<9 CBGC@=85H98 .H5H9A9BHC:"=B5B7=5@CB8=H=CB/<9F9K9F9BC;5=BGCF@CGG9GCBH<=GHF5BG57H=CB

**2>7.16.;992>06.8 ;>@4.42;816:4-G2>7.16.H**RH)CJ9A69F=BH<9BCFA5@ 7CIFG9C:=HGG97IF=H=9GA5F?9H;FCID6IG=B9GGH<9CAD5BM<587CAA=HA9BHGHCDIF7<5G9A=@@=CB =B5;9B7M(.:FCA9F?58=5K<=7<=GD5FH=5@@MCKB986MH<9+5F9BH

**"33602>? 6>20@;>? .:1 9<8;E22?**R -979=J56@9G :FCA 5B8 D5M56@9G HC 7IGHCA9FG =B7@I89 65@5B79G 5F=G=B; :FCAC::=79FGU8=F97HCFGU5B89AD@CM99GU=B8=J=8I5@G97IF=HMHF5BG57H=CBG/<9G9HF5BG57H=CBG5F9 GI6>97HHCH<9 G5A9 F9;I@5H=CBG5G5@@7IGHCA9FHF5BG57H=CBG5B85F9 DFCJ=898 CB GI6GH5BH=5@@MH<9 G5A9 H9FAG

{40}------------------------------------------------

#### NOTES TO CONSOLIDATED STATEMENT OF FINANCIAL CONDITION - CONTINUED NOVEMBER 30, 2023

#### 18. REGULATORY REQUIREMENTS

#### Net Capital

The Company is a registered broker-dealer and FCM and, accordingly, is subject to the net capital requirements of the SEC, CFTC and FINRA. The Company is required to maintain minimum net capital, as defined under SEC Rule 15c3-1, of not less than the greater of \$1.5 million or 2% of aggregate debit items arising from customer transactions, plus excess margin collateral on reverse repurchase transactions. As an FCM, the Company is subject to CFTC Regulation 1.17, which sets forth minimum financial requirements being the greater of \$1.0 million or its risk-based capital requirements computed as 8% of the total risk margin requirements for positions carried by the FCM in customer accounts and noncustomer accounts. The minimum net capital requirements in determining excess net capital for a duallyregistered U.S. broker-dealer and FCM is equal to the greater of the requirement under SEC Rule 15c3-1 or CFTC Regulation 1.17. Additionally, FINRA may require a member firm to reduce its business if its net capital is less than 4% of such aggregate debit items and may prohibit a firm from expanding its business if its net capital is less than 5% of such aggregate debit items. At November 30, 2023, the Company had net capital, as defined under such rules, of \$1,088.8 million, which exceeded the minimum regulatory capital requirement by \$980.6 million.

In addition, advances to the Parent and its affiliates, repayment of subordinated liabilities, capital distributions and other equity withdrawals are subject to certain notification requirements and other provisions of the SEC, CFTC and FINRA.

#### Customer Protection and Segregation Requirement

As a registered broker dealer that clears and carries customer accounts, the Company is subject to the customer protection provisions under SEC Rule 15c3-3 and is required to compute a reserve formula requirement for customer accounts and deposit cash or qualified securities into a special reserve bank account for the exclusive benefit of customers. At November 30, 2023, the Company had \$640.9 million in cash and qualified U.S. Government securities on deposit in special reserve bank accounts for the exclusive benefit of customers.

As a registered broker dealer that clears and carries proprietary accounts of brokers (commonly referred to as "PAB"), the Company is also required to compute a reserve requirement for PABs pursuant to SEC Rule 15c3-3. At November 30, 2023, the Company had \$53.1 million in cash and qualified U.S. Government securities on deposit in special reserve bank accounts for the exclusive benefit of PABs.

The qualified securities meeting the 15c3-3 customer and PAB requirements are included in Cash and securities segregated and Securities purchased under agreements to resell in the Company's Consolidated Statement of Financial Condition.

As of and for the year ended November 30, 2023, the Company, as a non-clearing FCM, did not hold any customer funds or carry any customer accounts related to the segregation requirements for (1) customers trading on U.S. commodity exchanges under CFTC Regulation 1.20, (2) foreign futures and foreign options customers under CFTC Regulation 30.7 and (3) cleared swap customer accounts under CFTC Regulation Section 4d(f).

\*\*\*\*\*\*\*

{41}------------------------------------------------

#### JEFFERIES LLC

## Schedule z

## Unconsolidated Statement of Segregation Requirements and Funds in Segregation for Customers Trading on U.S. Commodity Exchanges November 30, 2023 (Dollars in thousands)

| Segregation requirements:                                                               |       |  |
|-----------------------------------------------------------------------------------------|-------|--|
| Net ledger balance                                                                      |       |  |
| Cash                                                                                    |       |  |
| Securities, at market                                                                   |       |  |
| Net unrealized profit (loss) in open futures contracts traded on a contract market      |       |  |
| Exchange traded options                                                                 |       |  |
| Add market value of open option contracts purchased on a contract market                |       |  |
| Deduct market value of open option contracts granted (sold) on a contract market        |       |  |
| Net equity (deficit)                                                                    |       |  |
| Add: accounts liquidating to a deficit and accounts with debit balances - gross amount  |       |  |
| Less: amounts offset by customer owned securities                                       |       |  |
| Amount required to be segregated                                                        | ਦਿੱਤੇ |  |
|                                                                                         |       |  |
| Funds in segregated accounts:                                                           |       |  |
| Deposited in segregated funds bank accounts:                                            |       |  |
| Cash                                                                                    |       |  |
| Securities representing investments of customers' funds, at market                      |       |  |
| Securities held for particular customers or option customers in lieu of cash, at market |       |  |
| Margins on deposit with derivatives clearing organizations of contract markets:         |       |  |
| Cash                                                                                    |       |  |
| Securities representing investment of customers' funds, at market                       |       |  |
| Securities held for particular customers or option customers in lieu of cash, at market |       |  |
| Net settlement from (to) derivatives clearing organizations of contract markets         |       |  |
| Exchange traded options:                                                                |       |  |
| Value of open long option contracts                                                     |       |  |
| Value of open short option contracts                                                    |       |  |
| Net equities with other FCMs:                                                           |       |  |
| Net liquidating equity                                                                  |       |  |
| Securities representing investments of customers' funds, at market                      |       |  |
| Securities held for particular customers or option customers in lieu of cash, at market |       |  |
| Segregated funds on hand                                                                |       |  |
| Total amount in segregation                                                             |       |  |
| Excess (deficiency) funds in segregation                                                |       |  |
| Management Target Amount for Excess funds in segregation                                |       |  |
| Excess (deficiency) funds in segregation over (under) Management Target Amount Excess   |       |  |

As of November 30, 2023, the Company did not carry any commodities customers and accordingly, there are no items to report under the requirement of this Regulation.

{42}------------------------------------------------

#### JEFFERIES LLC

#### Schedule aa

#### Unconsolidated Statement of Segregation Requirements and Funds Held in Separate Accounts for Foreign Futures and Foreign Options Customers

Pursuant to Regulation 30.7

#### November 30, 2023

(Dollars in thousands)

| Foreign Futures and Foreign Options Secured Amounts:                                                                                                              |  |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|--|
| Amount required to be set aside pursuant to law, rule or regulation of a foreign government or a rule of a self-<br>regulatory organization authorized thereunder |  |
| Net ledger balances - Foreign futures and foreign options trading - All Customers                                                                                 |  |
| Cash                                                                                                                                                              |  |
| Securities, at market                                                                                                                                             |  |
| Net unrealized profit (loss) in open futures contracts traded on a foreign board of trade                                                                         |  |
| Exchange traded options                                                                                                                                           |  |
| Market value of open option contracts purchased on a foreign board of trade                                                                                       |  |
| Market value of open option contracts granted (sold) on a foreign board of trade                                                                                  |  |
| Net equity (deficit).                                                                                                                                             |  |
| Accounts liquidating to a deficit and accounts with debit balances - gross amount.                                                                                |  |
| Less amount offset by customer owned securities                                                                                                                   |  |
| Amount required to be set aside as the secured amount - Net Liquidating Equity Method ("NLEM")                                                                    |  |
| Greater of amount required to be set aside pursuant to foreign jurisdiction or NLEM                                                                               |  |
| Funds Deposited in Separate 17 CFR 30.7 Accounts:                                                                                                                 |  |
| Cash in banks                                                                                                                                                     |  |
| Securities in safekeeping with banks located in the United States                                                                                                 |  |
| Equities with registered futures commission merchants:                                                                                                            |  |
| Cash                                                                                                                                                              |  |
| Securities                                                                                                                                                        |  |
| Unrealized gain (loss) on open futures contracts                                                                                                                  |  |
| Value of long option contracts                                                                                                                                    |  |
| Value of short option contracts                                                                                                                                   |  |
| Amounts held by clearing organization of foreign boards of trade:                                                                                                 |  |
| Cash                                                                                                                                                              |  |
| Securities                                                                                                                                                        |  |
| Amount due to (from) clearing organization - daily variation                                                                                                      |  |
| Value of long option contracts                                                                                                                                    |  |
| Value of short option contracts                                                                                                                                   |  |
| Amounts held by members of foreign boards of trade:                                                                                                               |  |
| Cash                                                                                                                                                              |  |
| Securities                                                                                                                                                        |  |
| Unrealized gain (loss) on open futures contracts                                                                                                                  |  |
| Value of long option contracts                                                                                                                                    |  |
| Value of short option contracts                                                                                                                                   |  |
| Amounts with other depositories designated by a foreign board of trade                                                                                            |  |
| Segregated funds on hand                                                                                                                                          |  |
| Total funds in separate 17 CFR 30.7 accounts                                                                                                                      |  |
| Excess (deficiency) set aside funds for secured amount                                                                                                            |  |
| Management target amount for excess funds in separate 17 CFR 30.7 accounts                                                                                        |  |
| Excess (deficiency)funds in separate 17 CFR 30.7 accounts over (under) management target excess  \$                                                               |  |
|                                                                                                                                                                   |  |

As of November 30, 2023, the Company did not carry any foreign futures and foreign options customers and accordingly, there are no items to report under the requirements of this Regulation.

{43}------------------------------------------------

# Deloitte.

**Deloitte & Touche LLP**  30 Rockefeller Plaza New York, NY 10012-0015 USA

Tel: 1 212 492 4000 Fax: 1 212 489 1687 www.deloitte.com

 

January 26, 2024

Jefferies LLC 520 Madison Ave New York, New York 10022

In planning and performing our audit of the consolidated financial statements of Jefferies LLC (the "Company") as of and for the year ended November 30, 2023 (on which we issued our report dated January 26, 2024, and such report expressed an unqualified opinion on those financial statements), in accordance with the standards of the Public Company Accounting Oversight Board (United States), we considered the Company's internal control over financial reporting ("internal control") as a basis for designing our auditing procedures for the purpose of expressing an opinion on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control. Accordingly, we do not express an opinion on the effectiveness of the Company's internal control.

Also, as required by Regulation 1.16 of the Commodity Futures Trading Commission (CFTC), we have made a study of the practices and procedures followed by the Company, including consideration of control activities for safeguarding firm assets. This study included tests of such practices and procedures that we considered relevant to the objectives stated in Regulation 1.16, in making the periodic computations of minimum financial requirements pursuant to Regulation 1.17. Because the Company does not carry regulated commodity futures, foreign futures, or foreign options accounts for customers, nor does it perform custodial functions relating to customer securities, we did not review the practices and procedures followed by the Company in making the daily computations of the segregation requirements of Section 4d(a)(2) of the Commodity Exchange Act and the regulations thereunder, and the segregation of funds based on such computations, and in making the daily computations of the foreign futures and foreign options secured amount requirements pursuant to Regulation 30.7 of the CFTC.

The management of the Company is responsible for establishing and maintaining internal control and the practices and procedures referred to in the preceding paragraph. In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of controls and of the practices and procedures referred to in the preceding paragraphs and to assess whether those practices and procedures can be expected to achieve the CFTC's abovementioned objectives. Two of the objectives of internal control and the practices and procedures are to provide management with reasonable but not absolute assurance (1) that assets for which the Company has responsibility are safeguarded against loss from unauthorized use or disposition and (2) that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation of financial statements in conformity with accounting principles generally accepted in the United States of America. Regulation 1.16(d)(2) lists additional objectives of the practices and procedures listed in the preceding paragraph.

{44}------------------------------------------------

Because of inherent limitations in internal control and the practices and procedures referred to above, error or fraud may occur and not be detected. Also, projection of any evaluation of them to future periods is subject to the risk that they may become inadequate because of changes in conditions or that the effectiveness of their design and operation may deteriorate.

A *deficiency* in internal control over financial reporting exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A deficiency in *design* exists when (a) a control necessary to meet the control objective is missing or (b) an existing control is not properly designed so that, even if the control operates as designed, the control objective would not be met. A deficiency in *operation* exists when a properly designed control does not operate as designed, or when the person performing the control does not possess the necessary authority or competence to perform the control effectively.

A *significant deficiency* is a deficiency, or combination of deficiencies, in internal control over financial reporting that is less severe than a material weakness yet important enough to merit attention by those responsible for oversight of the Company's financial reporting.

A *material weakness* is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company's financial statements will not be prevented or detected on a timely basis.

Our consideration of internal control was for the limited purpose described in the first and second paragraphs and would not necessarily identify all deficiencies in internal control that might be material weaknesses. We did not identify any deficiencies in internal control and control activities for safeguarding certain regulated commodity firm assets that we consider to be material weaknesses, as defined above.

We understand that practices and procedures that accomplish the objectives referred to in the second paragraph of this report are considered by the CFTC to be adequate for its purposes in accordance with the Commodity Exchange Act, and related regulations, and that practices and procedures that do not accomplish such objectives in all material respects indicate a material inadequacy for such purposes. Based on this understanding and on our study, we believe that the Company's practices and procedures, as described in the second paragraph of this report, were adequate at November 30, 2023, to meet the CFTC's objectives.

This report is intended solely for the information and use of the Board of Directors, management, the CFTC, Financial Industry Regulatory Authority and National Futures Association, and other regulatory agencies that rely on Regulation 1.16 of the CFTC in their regulation of registered futures commission merchants and is not intended to be and should not be used by anyone other than these specified parties.

Yours truly,

January 26, 2024


Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.