# SCHLITT INVESTOR SERVICES, INC. X-17A-5/A (2023-02-28) — Broker-dealer annual report - Company: SCHLITT INVESTOR SERVICES, INC. - Form: X-17A-5/A - Filed: 2023-02-28 - Period: 2022-12-31 - Accession: 0000770355-23-000002 - CIK: 770355 - File #: 8-34202 - Type: Broker-dealer - Material weakness: No - Auditor: Ohab and Company, PA - Auditor location: Maitland, FL - Contact: Robert Schlitt Jr - Phone: 772-567-1188 - Email: bobjr@schlittservices.com - Website: schlittservices.com - Signed by: Robert W Schlitt Jr (President) Original filing: https://www.sec.gov/Archives/edgar/data/770355/000077035523000002/2022PublicAudit1.pdf --- {0}------------------------------------------------ **PUBLIC UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ANNUAL REPORTS FORM X-17A-5 PART** Ill **FACING PAGE** 0MB APPROVAL 0MB Number: 3235-0123 Expires: Oct. 31, 2023 Estimated average burden hours per response: 12 SEC FILE NUMBER 8-34202 **Information Required Pursuant to Rules 17a-5, 17a-12, and 18a-7 under the Securities Exchange Act of 1934** FILING FOR THE PERIOD BEGINNING JANUARY 1, 2022 AND ENDING DECEMBER 31 , 2022 MM/DD/YY MM/DD/YY **A. REGISTRANT IDENTIFICATION** NAME OF FIRM: \_S\_C\_H\_L\_IT\_T\_IN\_V\_E\_S\_T\_O\_R\_S\_E\_R\_V\_IC\_E\_S\_,\_I\_N\_C\_. ----- TYPE OF REGISTRANT (check all applicable boxes): ~Broker-dealer D Security-based swap dealer D Major security-based swap participant D Check here if respondent is also an OTC derivatives dealer ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use a P.O. box no.) 1717 INDIAN RIVER BLVD, STE 300 (No. and Street) VERO BEACH FL 32960-0867 (City) (State) (Zip Code) PERSON TO CONTACT WITH REGARD TO THIS FILING ROBERT SCHLITT 772-567-1188 BOBJR@SCHLITTSERVICES.COM (Name) (Area Code -Telephone Number) (Email Address) **B. ACCOUNTANT IDENTIFICATION** INDEPENDENT PUBLIC ACCOUNTANT whose reports are contained in this filing\* OHAB AND COMPANY, PA (Name - if individual, state last, first, and middle name) 100 E SYBELIA AVE, SUITE 130 MAITLAND FL 32751 (Address) (City) (State) (Zip Code) JULY 28, 2004 1839 **l" of ReglstcaUoo with PCAOB)llf applicable) FOR OFFICIAL USE ONLY (PCAOB Reglstcatloo N,mbe,,** if **applicable)** I \* 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 17 CFR 240.17a-S(e)(l)(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 **0MB** control number. {1}------------------------------------------------ #### **OATH OR AFFIRMATION** | I, Robert W. Schlitt Jr. | swear (or affirm) that, to the best of my knowledge and belief, the | | |----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------------------------------------------------|-------| | financial report pertaining to the firm of | Schlitt Investor Services, Inc. | as of | | 2~
December 31 | is true and correct. I further swear (or affirm) that neither the company nor any | | | | partner, officer, director, or equivalent person, as the case may be, has any proprietfv1 terest in any a· count classified solely | | | as that of a customer. | \ / | | | ~ -;,;~~~?~t-
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Title: | | PRESIDENT # **This filing\*\* contains (check all applicable boxes):** *I* - ~ (a) Statement of financial condition. - ~ (b) Notes to consolidated statement of financial condition. - D (c) Statement of income (loss) or, if there is other comprehensive income in the period(s) presented, a statement of comprehensive income (as defined in§ 210.1-02 of Regulation S-X). - D (d) Statement of cash flows. - D (e) Statement of changes in stockholders' or partners' or sole proprietor's equity. - D (f) Statement of changes in liabilities subordinated to claims of creditors. - D (g) Notes to consolidated financial statements. - D (h) Computation of net capital under 17 CFR 24O.15c3-1 or 17 CFR 24O.18a-1, as applicable. - D (i) Computation of tangible net worth under 17 CFR 24O.18a-2. - D (j) Computation for determination of customer reserve requirements pursuant to Exhibit A to 17 CFR 24O.15c3-3. - D (k) Computation for determination of security-based swap reserve requirements pursuant to Exhibit B to 17 CFR 24O.15c3-3 or Exhibit A to 17 CFR 24O.18a-4, as applicable. - D (I) Computation for Determination of PAB Requirements under Exhibit A to§ 24O.15c3-3. - D (m) Information relating to possession or control requirements for customers under 17 CFR 24O.15c3-3. - D (n) Information relating to possession or control requirements for security-based swap customers under 17 CFR 24O.15c3-3(p)(2) or 17 CFR 24O.18a-4, as applicable. - D (o) Reconciliations, including appropriate explanations, of the FOCUS Report with computation of net capital or tangible net worth under 17 CFR 24O.15c3-1, 17 CFR 240.18a-1, or 17 CFR 24O.18a-2, as applicable, and the reserve requirements under 17 CFR 240.15c3-3 or 17 CFR 24O.18a-4, as applicable, if material differences exist, or a statement that no material differences exist. - D (p) Summary of financial data for subsidiaries not consolidated in the statement of financial condition. - ~ (q) Oath or affirmation in accordance with 17 CFR 24O.17a-5, 17 CFR 24O.17a-12, or 17 CFR 24O.18a-7, as applicable. - D (r) Compliance report in accordance with 17 CFR 24O.17a-5 or 17 CFR 240.18a-7, as applicable. - D (s) Exemption report in accordance with 17 CFR 24O.17a-5 or 17 CFR 24O.18a-7, as applicable. - ~ (t) Independent public accountant's report based on an examination of the statement of financial condition. - D (u) Independent public accountant's report based on an examination of the financial report or financial statements under 17 CFR 24O.17a-5, 17 CFR 24O.18a-7, or 17 CFR 24O.17a-12, as applicable. - D (v) Independent public accountant's report based on an examination of certain statements in the compliance report under 17 CFR 24O.17a-5 or 17 CFR 24O.18a-7, as applicable. - D (w) Independent public accountant's report based on a review of the exemption report under 17 CFR 24O.17a-5 or 17 CFR 24O.18a-7, as applicable. - D (x) Supplemental reports on applying agreed-upon procedures, in accordance with 17 CFR 24O.15c3-le or 17 CFR 24O.17a-12, as applicable. - D (y) Report describing any material inadequacies found to exist or found to have existed since the date of the previous audit, or a statement that no material inadequacies exist, under 17 CFR 24O.l 7a-12(k). D(z) Other: \_\_\_\_\_\_\_\_\_ \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ \_ - - *\*\*To request confidential treatment of certain portions of this filing, see 17 CFR 240.17a-5(e)(3} or 17 CFR 240.18a-7{d}(2}, as applicable.* {2}------------------------------------------------ # SCHLITT INVESTOR SERVICES, **INC.** FINANCIAL STATEMENTS DECEMBER 31, 2022 {3}------------------------------------------------ ![](_page_3_Picture_0.jpeg) I 00 E. Sybclia Ave. Suite 130 Maitland. FL 32751 *Certified* Public Acco11111w1/s Email: panvii ohabi:o.eom Telephone 407-740-7311 Fax 407-740-6441 #### REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors and Stockholders' of Schlitt Investor Services, Inc. #### **Opinion on the Financial Statement** We have audited the accompanying statement offinancial condition of Schlitt Investor Services, Inc. as of December 31, 2022, and the related notes {collectively referred to as the "financial statement"}. In our opinion, the financial statement presents fairly, in all material respects, the financial position of Schlitt Investor Services, Inc. as of December 31, 2022 in conformity with accounting principles generally accepted in the United States of America. #### **Basis for Opinion** This financial statement is the responsibility of Schlitt Investor Services, lnc.'s management. Our responsibility is to express an opinion on Schlitt Investor Services, lnc.'s financial statement based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board {United States} {PCAOB) and are required to be independent with respect to Schlitt Investor Services, Inc. in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statement is free of material misstatement, whether due to error or fraud. Our audit included performing procedures to assess the risks of material misstatement of the financial statement, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. 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 statements. We believe that our audit provides a reasonable basis for our opinion. We have served as Schlitt Investor Services, lnc.'s auditor since 2018. Maitland, Florida February 15, 2023 {4}------------------------------------------------ #### **SCHLITT INVESTOR SERVICES, INC. STATEMENT OF FINANCIAL CONDITION AS OF DECEMBER 31, 2022** | ASSETS | | | |-------------------------------------------------------|----|----------| | Cash and cash equivalents | | 137,577 | | Commissions receivable | | . 20,548 | | Prepaid expenses | | 582 | | Total assets | \$ | 158,707 | | LIABILITIES | | | | Accounts payable and accrued expenses | \$ | 9,887 | | Payable to related party | | 12,105 | | Total liabilities | | 21,992 | | STOCKHOLDERS' EQUITY | | | | Common stock, \$1 par value, 10,000 shares authorized | | | | 200 shares issued and outstanding | | 200 | | Additional paid-in capital | | 72,143 | | Retained earnings | | 64,372 | | Total stockholders' equity | | 136,715 | | Total liabilities and stockholders' equity | \$ | 158,707 | {5}------------------------------------------------ #### **NOTE 1 GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** #### General Schlitt Investor Services, Inc. (the "Company") was incorporated in the State of Florida on September 27, 1984. The Company is a registered broker-dealer in securities under the Securities and Exchange Act of 1934, a member of the Financial Industry Regulatory Authority ("FINRA"), and the Securities Investor Protection Corporation ("SIPC"). The Company is affiliated through common ownership with Financial Planning & Tax Corporation and Schlitt Insurance Services, Inc. ("Insurance"). The Company is engaged in business as a securities broker-dealer, that provides several classes of services, including the sale of variable life insurance and annuities. The Company also sells mutual funds on an application basis. Under its membership agreement with FINRA and pursuant to Rule 15c3-3(k)(2)(i), the Company conducts business on a fully disclosed basis and does not execute or clear securities transactions for customers. Accordingly, the Company is exempt from the requirement of Rule 15c3-3 under the Securities Exchange Act of 1934 pertaining to the possession or control of customer assets and reserve requirements. #### Summary of Significant Accounting Policies The presentation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. For purposes relating to the statement of cash flows, the Company has defined cash equivalents as highly liquid investments, with original maturities of less than three months, that are not held for sale in the ordinary course of business. Commissions receivable are stated at face amount with no allowance for doubtful accounts. An allowance for doubtful accounts is not considered necessary because probable uncollectible accounts are immaterial. {6}------------------------------------------------ #### **NOTE 1 GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** # Summary of Significant Accounting Policies (continued) The Company recognizes revenue on the trade date as they believe that the performance obligation is satisfied because that is when the underlying financial instrument or purchaser is identified; the price is agreed upon and the risk and rewards of ownership have been transferred to/ from the customer. Distribution fees. The Company enters into arrangements with managed accounts or other pooled investment vehicles (funds) to distribute shares to investors. The Company may receive distribution fees paid by the fund up front, over time, upon the investor's exit from the fund (that is, a contingent deferred sales charge), or as a combination thereof. The Company believes that its performance obligation is the sale of securities to investors and as such this is fulfilled on the trade date. Any fixed amounts are recognized on the trade date and variable amounts are recognized to the extent it is probable that a significant revenue reversal will not occur once the uncertainty is resolved. For variable amounts , as the uncertainty is dependent on the value of the shares at future points in time as well as the length of time the investor remains in the fund, both of which are highly susceptible to factors outside the Company's influence, the Company does not believe that it can overcome this constraint until the market value of the fund and the investor activities are known, which are usually monthly or quarterly. Distribution fees recognized in the current period are primarily related to performance obligations that have been satisfied in prior periods. With the consent of its shareholders, the Company has elected to be treated as an S Corporation under Subchapter S of the Internal Revenue Code. Subchapter S of the Code provides that in lieu of corporate income taxes, the stockholders are individually taxed on the Company's taxable income; therefore, no provision or liability for Federal Income Taxes as included in these financial statements. #### **NOTE 2 INCOME TAXES** As discussed in Note 1 the Company has elected the S Corporate tax status; therefore, no federal income tax provision is reported. The Company is required to file income tax returns in both federal and state tax jurisdictions. The Company's tax returns are subject to examination by taxing authorities in the jurisdictions in which it operates in accordance with the normal statues of limitations in the applicable jurisdiction. For federal purposes, the statute of limitations is three years. Accordingly, the Company is no longer subject to examination of federal returns filed more than three years prior to the date of these financial statements. The statute of limitations for state purposes is generally three years, but may exceed this limitation depending upon the jurisdiction involved. Returns that were filed within the applicable statute remain subject to examination. As of December 31, 2022, the IRS has not proposed any adjustment to the Company's tax position. {7}------------------------------------------------ # **NOTE 3 RELATED PARTY TRANSACTIONS** The Company and a party with common ownership ("Insurance") share personnel, administrative expenses and office space. All costs incurred for such shared expenses are paid by Insurance and reimbursed by the Company in accordance with an administrative services agreement at a set rate of \$12,105 per month. For the year ended December 31, 2022, a total of\$145,701 was reimbursed by the Company and included as a management fee on the Statement of Income. The Company also owes Insurance \$12,105 in management fees at December 31, 2022. It is possible that the terms of certain related party transactions are not the same as those that would result for transactions among wholly unrelated parties. # **NOTE 4 CONCENTRATION OF CREDIT RISK** The Company is engaged in various trading and brokerage activities in which counterparties primarily include broker-dealers, banks and other financial institutions. In the event counter-parties do not fulfill their obligations, the Company may be exposed to risk. The risk of default depends on the creditworthiness of the counter-party or issuer of the instrument. It is the Company's policy to review, as necessary, the credit standing of each counter-party. # **NOTE 5 COMMITMENT AND CONTINGENCIES** ## Commitments The Company had no commitments, no contingent liabilities and had not been named as a defendant in any lawsuit at December 31, 2022 or during the year then ended. ## **NOTE 6 GUARANTEES** FASS ASC 460, Guarantees, requires the Company to disclose information about its obligations under certain guarantee arrangements. FASS ASC 460 defines guarantees as contracts and indemnification agreements that contingently require a guarantor to make payments to the guaranteed party based on changes in an underlying factor (such as an interest or foreign exchange rate, security or commodity price, an index or the occurrence or nonoccurrence of a specified event) related to an asset, liability or equity security of a guaranteed party. This guidance also defines guarantees as contracts that contingently require the guarantor to make payments to the guaranteed party based on another entity's failure to perform under an agreement as well as indirect guarantees of indebtedness of others. The Company has issued no guarantees at December 31, 2022 or during the year then ended. {8}------------------------------------------------ # **NOTE 7 SUBSEQUENT EVENTS** The Company has evaluated events subsequent to the statement of financial condition date for items requiring recording or disclosure in the financial statements. The evaluation was performed through the date the financial statements were available to be issued. Based upon this review, the Company has determined that there were no events which took place that would have a material impact on its financial statements. # **NOTE 8 NET CAPITAL REQUIREMENTS** The Company is subject to the Securities and Exchange Commission Uniform Net Capital Rule (SEC rule 15c3-1 ), which requires the maintenance of minimum net capital and requires that the ratio of aggregate indebtedness to net capital, both as defined, shall not exceed 15 to 1. Rule 15c3-1 also provides that equity capital may not be withdrawn or cash dividends paid if the resulting net capital ratio would exceed 1 0 to 1. Net capital and aggregate indebtedness change day to day, but on December 31, 2022, the Company had net capital of \$125,471 which was \$120,471 in excess of its required net capital of \$5,000; and the Company's ratio of aggregate indebtedness (\$21,992) to net capital was 0.18 to 1, which is less than the 15 to 1 maximum allowed. Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.