# DIRECTED SERVICES LLC X-17A-5 (2021-02-19) — Broker-dealer annual report - Company: DIRECTED SERVICES LLC - Form: X-17A-5 - Filed: 2021-02-19 - Period: 2020-12-31 - Accession: 0000826606-21-000003 - CIK: 826606 - File #: 8-39104 - Material weakness: No - Auditor: N/A-The Registrant qualifies for the single issuer exemption under Paragraph (e)(1)(i)(A) of Rule l7a-5 of the Securities Exchange Act of 1934. - Auditor location: N/A, PA - Contact: Richard Gelfand - Phone: 610-249-9557 - Signed by: Richard Gelfand (Financial Operations Principal) Original filing: https://www.sec.gov/Archives/edgar/data/826606/000082660621000003/2020PublicDSL.pdf --- {0}------------------------------------------------ #### STATEMENT OF FINANCIAL CONDITION (Unaudited) Directed Services LLC December 31, 2020 {1}------------------------------------------------ | UNITED STATES | | | | |------------------------------------|--|--|--| | SECURITIES AND EXCHANGE COMMISSION | | | | | Washington, D.C. 20549 | | | | ## ANNUAL AUDITED REPORT FORM X-17A-5 Part III | OMB APPROVAL | |---------------------------| | OMB Number: 3235-0123 | | Expires: October 31, 2023 | | Estimated average burden | | nours per response 12.00 | | SEC FILE NUMBER | | |-----------------|--| | 8- 39104 | | #### FACING PAGE Information Required of Brokers and Dealers Pursuant to Section 17 of the Securities Exchange Act of 1934 and Rule 17a-5 Thereunder | REPORT FOR THE PERIOD BEGINNING | 01/01/20 | AND ENDING | 12/31/20 | |--------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------|------------|------------------------------------------------| | | MM/DD/YY | | MM/DD/YY | | | A. REGISTRANT IDENTIFICATION | | | | NAME OF BROKER DEALER: DEALER: Directed Services LLC | | | OFFICIAL USE ONLY | | ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use P.O. Box No.) | | | FIRM LD. NO. | | 1475 Dunwoody Drive, Suite 200 | | | | | | (No. and Street) | | | | West Chester | PA | | 19380 | | (City) | (State) | | (Zip Code) | | Richard Gelfand
INDEPENDENT PUBLIC ACCOUNTANT whose opinion is contained in this Report* | B. ACCOUNTANT IDENTIFICATION | | 610-249-9557
(Area Code - Telephone Number) | | | | | | | The Registrant qualifies for the single issuer exemption (e)(1)(1)A) of Rule 17a-5 of the Securities Exchange Actof 1934 | (Name - if individual, state last, first, middle name) | | | | and therefore is not required to engage an independent certified public accountant to certify its annual report. | | | | | (Address) | (City) | (State) | (Zip Code) | | CHECK ONE: | | | | | Certified Public Accountant
0 | | | | | Public Accountant
1 | | | | | [ Accountant not resident in United States or any of its possessions | | | | | | FOR OFFICIAL USE ONLY | | | \* Claims for exemption from the requirement that the annual report be covered by the opinion of an independent must be supported by a statement of facts and circumstances relied on as the basis for the exemption. See Section 240. 17a-5(e)(2). > Potential 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. SEC 1410 (11-05) {2}------------------------------------------------ #### OATH OR AFFIRMATION Richard Gelfand . swear (or affirm) that, to the best of my knowledge and belief the accompanying financial statement and supporting schedules pertaining to the firm of Directed Services LLC . as of December 31 2020 , are true and correct. The Registrant qualifies for the single issuer exemption under Paragraph (e)(1)(1)(A) of Rule 17a-5 of the Securities Exchange Act of 1934 and therefore is not required to engage an independent cetified public accountant to certify its annual report. I further swear (or affirm) that neither the company nor any partner, principal officer or director has any proprietary interest in any account classified solely as that of a customer, except as follows: Signature Financial Operations Principal Title Commonwealth of Pennsylvania Notary Seal Notary Public KATHLEEN BRADFIELD, Notary Public Bucks County This report \*\* contains (check all applicable boxes): My Commission Expires October 31, 2021 ष्ट्र (a) Facing Page. Commission Number 1097214 মে (b) Statement of Financial Condition. □ (c) Statement of Income (Loss). □ (d) Statement of Changes in Financial Condition. O (e) Statement of Changes in Stockholders' Equity or Partners' or Sole Proprietors' Capital. O (f) Statement of Changes in Liabilities Subordinated to Claims of Creditors. □ (g) Computation of Net Capital. O (h) Computation for Determination of Reserve Requirements Pursuant to Rule 15c3-3. [i) Information Relating to the Possession or Control Requirements Under Rule 15c3-3. [ (j) A Reconciliation, including appropriate explanation of Net Capital Under Rule 15c3-1 and the Computation for Determination of the Reserve Requirements Under Exhibit A of Rule 15c3-3. O (k) A Reconciliation between the audited Statements of Financial Condition with respect to the methods of consolidation. 区 (1) An Oath or Affirmation. - □ (m) A copy of the SIPC Supplemental Report. - [1] A report describing any material inadequacies found to have existed since the date of the previous audit. \*\* For conditions of confidential treatment of certain portions of this filing, see section 240. 17a-5(e)(3) {3}------------------------------------------------ ## Directed Services LLC Statement of Financial Condition - Unaudited\* December 31, 2020 #### Contents | Statement of Financial Condition | | |-------------------------------------------|--| | Notes to Statement of Financial Condition | | \* The Registrant qualifies for the single issuer exemption under Paragraph (e)(1)(i)(A) of Rule 17a-5 of the Securities Exchange Act of 1934 and therefore is not required to engage an independent certified public accountant to certify its annual reports. {4}------------------------------------------------ # Directed Services LLC Statement of Financial Condition - Unaudited December 31, 2020 | Assets | | | |-----------------------------------------------------------------|----|-----------| | Cash | ಕಾ | 3,776,216 | | Distribution fee receivable | | 4,470,602 | | Commissions and concessions receivable, net of allowance of \$0 | | 6,863 | | Prepaid expenses | | 18,409 | | Total assets | | 8,272,090 | | | | | | Liabilities and member's equity | | | | Liabilities: | | | | Commissions and concessions payable | | 3,465,545 | | Payable to affiliates | | 2,496,296 | | Accounts payable and other accrued liabilities | | 368,215 | | Total liabilities | | 6,330,056 | | | | | | Contingencies (Note 6) | | | | | | | | Member's equity | | 1,942,034 | | Total liabilities and member's equity | S | 8,272,090 | {5}------------------------------------------------ ## 1. Nature of Business and Ownership Directed Services LLC (the "Company") operates as a broker-dealer registered under the Securities Exchange Act of 1934 and is a member of the Financial Industry Regulatory ("FINRA"). The Company is a single member limited liability company, and the limited liability company agreement provides that neither nor any manager shall be liable for the liabilities of the Company is also registered as a broker/dealer with the appropriate state authorities and U.S. jurisdictions/territories, as applicable. The Company services variable insurance products previously sold and/or serviced through FINRA third-party member firms (each a "Selling or Servicing Broker/Dealer" and together the "Servicing Brokers") with which the Company entered into a sales agreement and also had entered into, when and where appropriate, agreements with the affiliated insurance agency of each Servicing Broker. The variable insurance products were previously issued by Venerable Insurance and Annuity Company ("VIAC"), a Company affiliate, and supported by VIAC separate accounts. As of June 1, 2018, VIAC ceased offering and the Company ceased wholesaling new products. The Company is a wholly owned subsidiary of Venerable Holdings, Inc. ("Venerable Holdings" or the "Parent") and ultimately of VA Capital Company, LLC ("VA Capital"). The Company does not carry customer accounts and is not required to make the periodic computation of reserve requirements for the exclusive benefit of customers. Accordingly, the Company is exempt from Securities and Exchange Commission ("SEC") Rule 15c3-3. ## 2. Summary of Significant Accounting Policies ## Basis of Presentation The accompanying financial statement has been prepared in accordance with accounting principles generally accepted in the United States ("U.S. GAAP"). ## Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Management believes that the estimates utilized in preparing its financial statements are reasonable and prudent. Actual results could differ from those estimates. ## Cash Cash represents cash on deposit. Commissions, Concessions and Distribution Fee Receivables Commissions, concessions and distribution fee receivables are shown at their net realizable value. Uncollectible receivables are charged to operations during the period they are determined to be uncollectible. Liabilities Subordinated to the Claims of General Creditors At December 31, 2020 and during the year then ended, the Company had no liabilities subordinated to the claims of general creditors. {6}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{7}------------------------------------------------ # Directed Services LLC Notes to Statement of Financial Condition - Unaudited The Company is allocated a portion of general administrative expenses from its affiliates based on volume, number of personnel, and activity. At December 31, 2020, accrued expenses of \$71,859 are reported in Payables to affiliates in the Statement of Financial Condition. Amounts reported in the Statement of Financial Condition related to transactions and agreements with affiliates may not be the same as those incurred if the Company was not a wholly-owned subsidiary of its Parent. Receivables and payables with affiliates are settled in cash on a regular basis. ## 5. Employee Benefit Plans The employees of affiliated companies providing services to the Company are covered by employee benefit plans that are administered by affiliates. The different plans eligibility standards, vesting requirements, and guidelines for matching. The Company had no separate employee benefit plans in 2020 and relied on its affiliated companies to cover all eligible employees. All benefits paid by these affiliates are charged back to the Company for reimbursement. #### Contingencies 6. The Company is from time to time party to claims, lawsuits, arising in the course of its normal business activities. While it is not possible to forecast the outcome of such lawsuits/arbitrations, in light of existing insurance and established reserves, it is the opinion of management that the disposition of such lawsuits/arbitrations will not have a materially adverse effect on the Company's operations or financial position. The Company and its affiliates periodically receive informal and formal on from various state and federal governmental agencies and self-regulatory organizations in connection with inquiries and investigations of the products and practices of the Company, its affiliates or the financial services industry. Such investigations and inquiries could result in regulatory action against the Company. The potential outcome of any such action is difficult to predict but could subject the Company or its affiliates to adverse consequences, including, but not limited to, settlement payments, penalties, fines and other financial liability. It is not currently anticipated that the outcome of any such action will have a material adverse effect on the Company. For some matters, the Company is able to estimate a possible range of loss. For such matters in which a loss is probable, an accrual is made. For matters where the Company, however, believes a loss is reasonably possible, but not probable, no accrual is required. For matters for which an accrual is made, but there remains a reasonably possible range of loss in excess of the amounts accrued or for matters where no accrual is required, the Company develops an estimate of the reasonably possible range of losses in excess of reserves. As of December 31, 2020, the aggregate range of reasonably possible losses in excess of any amounts accrued for these matters as of such date, is not material to the Company. For other matters, the Company is currently not able to estimate the reasonably possible loss range of loss. The Company is often unable to estimate the possible loss or range of loss until developments in such matters have provided sufficient information to support an assessment of the range of possible loss, such as quantifications of a damage demand from plaintiffs, discovery from plaintiffs and other parties, investigation of factual allegations, rulings by a court on motions or appeals, analysis by experts and the progress of settlement discussions. On an ongoing basis, the Company reviews relevant information with respect to litigation and regulatory contingencies and updates the Company's accruals, disclosures and reasonably possible losses or ranges of loss. {8}------------------------------------------------ # **.6\*(8\*) \*6:.(\*7 38\*783 8&8\*1\*283+.2&2(.&032).8.32"2&9).8\*)** ## **\*8&4.8&0\*59.6\*1\*287** \*74>C74)+=85>A<%4C0?8C0;(D;4 (D;4 2 F7827 A4@D8A4BC74<08=C4=0=24>5 <8=8>5066A460C48=341C43=4BBC>=4C20?8C0;1>C70B3458=43B70;;=>C 4G2443 C> (D;4 2 0;B>?A>E834BC70C4@D8CH<0H=>C14F8C73A0F=>A20B738E834=3B?08385C74A4BD;C8=6 A0C8>>5066A460C438=341C43=4BBC>=4C20?8C0;F>D;34G2443 C> C424<14A C74>5 F7827F0B 8=4G24BB>58CBA4@D8A43 =4C20?8C0;>5 \*74>>5066A460C48=341C43=4BBC>=4C20?8C0;0C424<14A F0B C> Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.