# L.O. THOMAS & CO. INC. X-17A-5 (2021-02-24) — Broker-dealer annual report

- Company: L.O. THOMAS & CO. INC.
- Form: X-17A-5
- Filed: 2021-02-24
- Period: 2020-12-31
- Accession: 0000846416-21-000001
- CIK: 846416
- File #: 8-40875
- Material weakness: No
- Auditor: MICHAEL T REMUS
- Auditor location: TRENTON, NJ
- Contact: JOHN W RISLEY JR
- Phone: 6099274044
- Signed by: JOHN W RISLEY JR (PRESIDENT/CCO)

Original filing: https://www.sec.gov/Archives/edgar/data/846416/000084641621000001/2020AUDIT4.pdf

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Ll\TJTEDSTATES SECURITIES �'D EXCHANGE COl\l\USSION Washington, D.C. 20549 .. I I

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SEC FILE NUMBER

I

**B-40875**

#### **ANNUAL AUDITED REPORT FORM X-17 A-5 PART Ill**

|  | FACI:\"GPAGE |
|--|--------------|

**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 BEG 1 1ITNG 01/01/2020                         | -<br>-<br>--<br>------                                                     | AND ENDING 12/31/2020 |                                  |
|----------------------------------------------------------------------|----------------------------------------------------------------------------|-----------------------|----------------------------------|
|                                                                      | � 1 MD D ! YY                                                              |                       | (<br>MM!DDYY<br>(                |
| A.                                                                   | REGISTRANT IDENTIFICATION                                                  |                       |                                  |
| NAME oF BROKER-DEALER: LO. Thomas & Co., Inc.                        |                                                                            |                       | -<br>I<br>OFFICIAL USE ONLY      |
|                                                                      | ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use P.O. Box No.)          |                       | FIRM LO. NO.                     |
| 2106 New Road -<br>Suite A6                                          |                                                                            |                       |                                  |
|                                                                      | (No and Street)                                                            |                       |                                  |
| Linwood                                                              | NJ                                                                         | 08826                 |                                  |
| (City)                                                               | (State)                                                                    | (Zip Code)            |                                  |
|                                                                      | NAJ\H: AND ltLb.PHONb NUMBER OF PERSON TO CONTACT IN REGARD TO THIS REPORT |                       |                                  |
| John iN Risley  Jr. PresidEflL'CCO                                   |                                                                            |                       | 609-927-4044                     |
| B.                                                                   | ACCOUNTANT IDENTIFICATION                                                  |                       | (Area Code - T c>lephone Number) |
| Michael T. Remus, CPA                                                | INDEPENDENT PUBLIC ACCOUNT ANT whose opinion is contained in this Report*  |                       |                                  |
|                                                                      | (Name - if individual, stare last, firsr. middle name)                     |                       |                                  |
| PO Box 2555                                                          | Hamilton Square                                                            | NJ                    | 08690                            |
| (Address)                                                            |                                                                            | (State)               | (Zip Code)                       |
| CHECK ONE:                                                           |                                                                            |                       |                                  |
| I<br>I<br>✓<br>Certified Public Accountant<br>Public Accountant<br>B |                                                                            |                       |                                  |
|                                                                      | Accountant not resident in United States or any of its possessions.        |                       |                                  |
|                                                                      |                                                                            |                       |                                  |
|                                                                      | FOR OFFICIAL USE ONLY                                                      |                       |                                  |

*\*Clai111sfor exemptio11j1·om tl1e requiremem that tl,e annual report be co,·ered by tlle opinion of mi independellf public accountam 11111st be s11pporred by a statement offdcts and circu111sta11ces relied 011 as the basis for the exemption See Sectim1 :;40.17a-5(e){])*

> **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 OM B control number.**

SEC 1410 (11-05)

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#### **OATH OR AFFIRMATION**

I. John W. Ris ley , swear (or affirm) that. to the best of my knowledge and belief the accompanying financial statement and snpporting schedules perraining to the firm of \_L\_.o\_. Tho \_\_ma\_\_ s\_&\_C\_o.\_.\_ln\_ c\_. \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ \_\_\_\_\_\_\_\_\_\_ \_\_\_\_\_ . as

of December 31

. 20 20 - --. are true and correct. I further swear (or affirm) that

neither the company nor any partner, proprietor, principal officer or director has any proprietary interest in any account classified solely as that of a customer. except as follO\vs:

CEO/Managing Member Title

This report\*\* contains (check all applicable boxes):

- 0 (a) Facing Page.
- 0 (b) Statement of Financial Condition.
- 12] (c) Statement oflncome (Loss) or. if there is other comprehensive income in the period(s) presented. a Statement of Comprehensive Income (<ls defined in §210.1-02 of Regulation S-X).
- (d) Statement of Changes in Financial Condition .
- � , .., ( e) Statement of Changes in Stockholders' Equity or Partners· or Sole Proprietors' Capital.
- (f) Statement of Changes in Liabilities Subordinated to Claims of Creditors.
- (g) Computation of Net Capital.
- �� (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.
- 0 (i) A Reconciliation. including appropriate explanation of the Computation of Net Capital Under Rule 15c3-1 and the Computation for DeterminMion of the Reserve Requirements Under Exhibit A of Rule l 5c3-3.
- (k) A Reconciliation between the audited and umrndited Statements of Financial Condition with respect to methods of consolidation. □
- (1) An Oath or Affirmation.
- (m) A copy of the SIPC Supplemental Report.
- (n) A report describing any material inadequacies found to exist or found to have existed since the date of the previous audit.

*\*\*For co11ditio11s of co11fide111ial rrean11e11f of cerrai11 portions of this filing, see section 140. 17a-5(e)(3}.* 

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#### **Exemption Report pursuant to SEC Rule 17a-5 For the Year Ended December 31, 2020**

#### STATEMENT OF EXEMPTION FROM SEC RULE 15c3-3

L.O. Thomas & Co., Inc. (the "Company'') is a registered broker-dealer subject to Rule 17a-5 promulgated by the Securities and Exchange Commission (17 C. F.R 5240. l 7a-5, "Reports to be made by certain brokers and dealers"). This ExemptionReportwas preparedasrequiredby 17C.F.R. 5240. l 7a-5(dXl) and (4). To the best ofitsknowledge and belief, the Company states the following:

- (1) The Company claimed an exemption from 17 C.F.R. 5240.15c3-3 under the following provisions of 17 C.F.R. 5240 .15c3-3(k)(2Xii).
- (2) The Company met the identified exemption provisions in 17 C.F.R. §240.15c3-3(k)(2)(ii) throughout the most recent fiscal period without exception.

L.O. Thomas **&** Co., Inc.

I, John W. Risley, swear ( or affirm) that, to my best knowledge and belief, this Exemption Report is true and correct

By:

*J~'J?J?!tj,)* 

/¾-es ✓ *'11,/fou* /~£<> **Title: CEO** <sup>7</sup>

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#### **FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION**

**For the Year Ended** 

**December 31, 2020** 

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#### *�P�A�taa*  **MICHAEL T. REMUS**

P.O. Box 2555 Hamilton Square, NJ 08690 **Tel:** 609-540-1751 **Fax:** 609-570-5526

#### Report of Independent Registered Public Acrnunting Firm

To: The Board of Directors and Stockholder of L.O. Thomas & Co., Inc.

#### **Opinion on the Financial Statements**

I have audited the accompanying statement of financial condition of L.O. Thomas & Co., Inc. as of December 31, 2020, and the related statements of operations, changes in stockholder equity and cash flows for the year then ended, that arc filed pursuant lo Rule 17a-5 under the Securities Exchange Act of l 934 and the related notes [ and schedules] ( collectively referred to as the rinancial statements). ln my opinion. the financial statements present fairly, in all material respects, the financial position ofL.O. Thomas & Co., Inc. as of December 31, 2020 and its results of operations and its cash flows for the year then ended in conformity with accounting principles generally accepted in the United States of America.

#### **Basis for Opinion**

These financial statements arc the responsibility of L.O. Thomas & Co., Inc. 's management. My responsibility is to express an opinion on L.O. Thomas & Co., Inc. 's financial statements based on my audit I am a public accounting firm registered \vith the Public Company Accounting Oversight Board (United States) (PCAOB) and I am required to be independent with respect to L.O. Thomas & Co., 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.

I conducted my audit in accordance with the standards of the PCAOB. Those standards require that l plan and perform the audit to obtain reasonable assurance about whether the financial statements arc free of material misstatement, whether due to error or fraud. My audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to eITor or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and <lisdosures in the financial statements. My audit also included evaluating the accounting principJes used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. 1 believe that my audit provides a reasonable basis for my opinion.

#### **Supplemental Information**

The Schedule T, Computation of Net Capital Under SEC Rule 15c3-l, Schedule ll, Computation for Identification of Reserve Requirements Under SEC Ruic 15c3-3 *(exemption)* and Schedule lll, lnfonnation Relating lo Possession or Control Requirements Under SEC Rule l 5c3-3 *(exemption)*  has been subjected to audit procedures performed in conjunction \Vith the audit or L.O. Thomas & Co., Inc. 's financial statements.

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The supplemental information is the responsibility ofL.O. Thomas & Co., Inc. 's management. My audit procedures included determining whether the supplemental information reconciles to the financial statements or the underlying accounting and other records, as applicable, and performing procedures to test the completeness and accuracy of the information presented in the supplemental infom1ation. In forming my opinion on the supplemental infonnation, I evaluated whether the supplemental information, inc1uding its fonn and content, is presented in conformity with 17 C.F.R. §240.1 ?a-5. In my opinion) the Schedule I, Computation of Net Capital. Under SEC Ruic l 5c3-1, Schedule II, Computation for Identification of Reserve Requirements Under SEC Rule l 5c3-3 *(exemption)* and Schedule III, Information Relating to Possession or Control Requirements Under SEC Rule l 5c3-3 ( *exemption)* is fairly stated, in all material respects, in relation to the financial statements as a whole.

I have served as L.O. Thomas & Co., Inc. auditor since 20.16.

Michael T. Remus, CPA Hamilton Square, New Jersey February 15, 202 J

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#### **L.O. Thomas** & **Co., Inc.** STATEMENT OF FINANCIAL CONDITION December 31, 2020

#### ASSET

| Current Assets                                    |              |
|---------------------------------------------------|--------------|
| Cash                                              | \$<br>30,175 |
| Commissions receivable                            | 19,122       |
| Prepaid expenses                                  | 15,084       |
| Fixed assets, office equipment net of accumulated | 0            |
| depreciation of \$25,133                          |              |
| Total Assets                                      | \$<br>64I381 |
|                                                   |              |

#### **LIABILITIES & STOCKHOLDER EQUITY**

| Liabilities                              |              |
|------------------------------------------|--------------|
| Cunent Liabilities                       |              |
| Accounts payable & accmed expenses       | \$<br>4,747  |
| Commissions payable                      | 13,450       |
| Income tax payable                       | 750          |
| Total Liabilities                        | 18,947       |
|                                          |              |
| Stockholder Equity                       |              |
| Common Stock, no par value, 1,000 shares | 30,000       |
| authorized I 00 issued and outstanding   |              |
| Additional paid-in-capital               | 5,900        |
| Retained earnings                        | 9,534        |
| Total Stockholder Equity                 | 45,434       |
| TOTAL LIABILITIES & STOCKHOLDER EQUITY   | \$<br>64,381 |
|                                          |              |

"See accompanying notes to financial statements."

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Statement of Operations For the Year Ended December 31, 2020

#### REVENUES

| Commissions, net of clearing fees | 39.9 6<br>2<br>8<br>\$ |
|-----------------------------------|------------------------|
| Mutual fund and 12b-l fees        | 5 )<br>6 0, -3 7       |
| Other revenue                     | 47,392<br>3            |
| Interest income                   | 1                      |
| Total Revenues                    | 1,237,916              |
| EXPENSES                          |                        |
| Commissions                       | 911,655                |
| Occupancy                         | 28,800                 |
| Compensation and benefits         | 51,140                 |
| Regulatory fees                   | 20,303                 |
| Legal and professional            | 11,125                 |
| Technology and communication      | 12,410                 |
| General and administrative        | 41,200                 |
| Travel and entertaim11ent         | 4,802                  |
| Depreciation                      | 239                    |
| Total Expenses                    | 1,081,674              |
| Income before income tax          | 156,242                |
| Income tax                        | 350                    |
| Net Income                        | 155,892<br>\$          |

"See accompanying notes to financial statements. **<sup>11</sup>**

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**L.O. Thomas** & **Co., Inc.** Statement of Changes **in** Stockholder Equity Year Ended December 31, 2020

|                                   | 1          | Common Stock | Additional<br>Paid-in | ned<br>R<cta<br>i  | Stockholder<br>Total |
|-----------------------------------|------------|--------------|-----------------------|--------------------|----------------------|
|                                   | res<br>Sha | Amount       | Capital               | S<br>i11R<br>En.rn | Equt�J               |
| Balance, December 31, 2019        | 100        | 30,000<br>s  | 5,900<br>\$           | 699<br>s           | \$<br>36,599         |
| Net Income                        |            |              |                       | 155,892            | 155,892              |
| Distributions paid to shareholder |            |              |                       | (147,057)          | (147,057)            |
| Balance, December 31, 2020        | 100        | 30,000<br>s  | 5,900<br>\$           | 9,534<br>\$        | \$<br>45,434         |
|                                   |            |              |                       |                    |                      |

"See accompanying notes to financial statements."

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## **L.O. Thomas & Co., Inc.** Statement of Cash Flows For the Year Ended December 31, 2010

## **CASH FLOWS FROM OPERATING ACTIVITIES**  .. .

| Net income                                                                                                          | 155,892<br>IA                |  |
|---------------------------------------------------------------------------------------------------------------------|------------------------------|--|
| Adjustments to Reconcile Net income to Net<br>Cash Provided By Operating Activities:                                |                              |  |
| Depreciation Expense                                                                                                | 239                          |  |
| (Increase) Decrease in:                                                                                             |                              |  |
| Commissions receivable<br>Prepaid expenses                                                                          | 13,261<br>413                |  |
| ued expenses<br>Accounts payable and accr<br>Commissions payable<br>Increase (Decrease) in:<br>Income tax payable   | (11,366)<br>(1,150)<br>2,397 |  |
| Net cash provided by Operating Activities                                                                           | 159,686                      |  |
| Cash Flows From Iuvt>stiug Activities                                                                               |                              |  |
| Net cash used in Financing Activities<br>mdug Activities<br>Distribution paid to shareholder<br>Cash Flows From Fim | (147,057)<br>(147,057)       |  |
| or the period<br>Net cash increase f                                                                                | 12,629                       |  |
| Cash at beginning of period                                                                                         | 17,546                       |  |
| Cash at end of period                                                                                               | 30,175<br>s                  |  |
| ormation:<br>e of Cash Flow Inf<br>Supplemental Disclosur<br>Interest paid                                          | \$                           |  |
| Taxes Paid                                                                                                          | 350<br>s                     |  |

"See accompanying notes to financial statements."

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#### **L.O. Thomas** & **Co., Inc.** Notes To Financial Statements December 3 1, 2020

#### **Note 1- Organl:Lation and Nature of Business**

L.O. Thomas & Co., Inc. (the Company) is a broker-dealer registered with the Securities and Exchange Commission (''SEC") and is a member of the Financial Industry Regulatory Authority (" FJNRA") and the Securities Investor Protection Corporation ("SIPC"). The transactions arc conducted on a fully disclosed basis with other broker-dealers. Accordingly, the Company operates under the cxcmptive provisions of the Securities and Exchange Commission Ruic l5c3-3 Section (k)(2)(ii) of the rule.

The Company is registered and nmducts business from their office located in Linwood, New· Jersey, and is registered to conduct business in other slates. The Company's primary source of revenue is providing brokerage services to customers, who arc predominately small and middle-market business and individuals.

#### **Note 2 - Summary of Significant Accounting Policies**

*(a) Basis <?/Presentation*

The financial statements and accompanying notes arc prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") unless othenvisc disclosed.

*(b) Ui;e <?( Estimates*

The preparation of financial statements in conformity with generally accepted accounting principles 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 m11ounts of revenue and expenses during the reporting period. Actual results could diffor from those estimates.

#### *( c) Statement <f Cash Plows*

For purposes of the statement of cash flows the Company has defined cash equivalents as highly liquid investments, with original maturities of less than three months, that arc not held for sale in the ordinary course ofbusiness. The company has adopted the indirect method of presenting the statement of cash flows in accordance with current authoritative pronouncements. There were no cash equivalents at December 31, 2020.

*(d) Commissions*

The commission based revenue is recorded on a settlement date basis. Securities transactions, underlying the commissions, ate also recorded on a settlement date basis.

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### **L.O. Thomas & Co., Inc.** Notes To Financial Statements December 3 I, 2020

## *(e) Office Equipment*

Office equipment is stated at cost. Significant additions or improvements extending asset lives arc capitalized� nonnal maintenance and repair cost are expensed as incutTcd. Depreciation has been computed using tl1e straight-line method for financial statement repotiing and various accelerated methods allowable for income tax purposes. The cost and related accumulated depreciation of property and equipment retired or disposed of are removed from the accounts and the resulting gains or losses arc reflected in income.

## *(f) Commissions* receivable

Commissions receivable have been adjusted for all known uncollectiblc accounts. J\n allowance for doubtful accounts is not provided since, in the opinion of management all amounts recorded on the books are deemed collectible.

# *(g) Accounts Payahle*

Accounts payable consist of all operating liabilities that can be matched to the period the goods or services were incurred.

### *(h) Income Taxes*

The Company elected to be taxed for Federal and New Jersey state income tax purposes as an S-Corporation. Under this structure, the shareholder is liable for any Federal or State income tax due. Therefore, no provision or liability for federal or state income taxes has been included in the financial statements.

The Company's tax re1ums and the amount of income or loss allocable to the shareholder arc subject to examination by federal and s1ate taxing authorities. In the event of an examination of the Company's tax return, the tax liability of the shareholder could be changed if an adjustment in the Company's income or loss is ultimately detennined by the taxing authorities.

Certain transactions may be subjec1 to accounting methods for federal and state income tax purposes which differ from the accounting methods used in preparing the ftnancia I statements. Accordingly, tl1e net income or loss of the shareholder and the resulting balances in the shareholders' capital account reported for federal and state income tax purposes may differ from the balances reported for those same ilcms in these financial statements. adjusted when new information is available, or when an event occurs that requires a change. f

The Company recognizes and measures its unrecognized tax benefits in accordance with ASC Topic 740, Income Taxes. Under that guidance the Company assesses the likelihood, based on their technical merit, that lax positions will be sustained upon examination based on the facts, circun1stanccs and information available at the end of the financial rcpoiiing period. The measurement of unrecognized tax benefits is

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#### **L.O. Thomas** & **Co., Inc.** Notes lo Financial Statements December 3 l, 2020

#### *(h) Income Taxes - continued*

Management has dctcnnincd that the Company has no uncertain tax positions that would require financial statement recognition at December 31, 2020. This dctennination will always be subject to ongoing evaluation as facts and circumstances may require. The Company remains subject to U.S. federal and state income tax audits for all years subsequent to 2016.

In addition, no income tax related penalties or interest have been recorded for the year ended December 3 L 2020.

#### *(i) Fair Value Hierarchy*

FASB ASC 820 defines fair value, establishes a framework for measuring fair value, and establishes a fair value hierarchy which prioritizes the inputs to valuation techniques. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A fair value measurement assumes that the transaction to sell the asset or transfer the liability occurs in the principal market for the asset or liability or, in the absence of a principal market, the most advantageous market. Valuation techniques that arc consistent with the market, income or cost approach, as specified by FASB ASC 820, arc used to measure fair value.

The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three broad levels:

- *level 1.* Quoted prices (unadjusted) in active markets fbr identical as1-:cts or liabilities that the Company has the ability to access al the measurement date.
- *level 2.* Inputs other than quoted prices included in level I that arc observable for the assets or liability either directly or indirectly.
- *level 3.* Inputs are unobservable for the assets or liability.

The availability of observable inputs can vary from security to security and is affected by a wide variety of factors, including, for example, the type of security, the liquidity of markets, and other characteristics particular to the security. To the extent the valuation is based on models or inputs that arc less observable or unobservable in the market, the determination of fair value requires more judgmenl. Accordingly, the degree of judgment exercised in determining the fair value is greatest for instruments categorized in level 3.

The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement falls in its entirety is detcnnincd based on the lowest level input that is significant to the fair value measurement in its entirety.

For further discussion of fair value, sec "Note 5 Fair Value"

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**L.O. Thomas & Co., Inc.** Notes to Financial Statements December 3 I, 2020

#### *0) Advertising and Marketing*

Advertising and marketing costs in the amount of \$300 arc expensed as incurred.

#### *(k) General and Administrative E-i.:penses*

General and administrative costs are expensed as incurred.

#### **Note 3 - Net Capital Requirements**

The Company is subject to the SEC Uniform Net Capital Rule (SEC Ruic l 5c3-l ), which requires the maintenance of minimum net capital and requires that the ratio of aggregate indebtedness to net capital, both as de<sup>f</sup>ined, shall not exceed I 5 to I (and the rule of the "applicable" exchange also provides that equity cap.ital may not be withdrawn or cash dividends paid if the resulting net capital ratio would exceed 10 to I). At December 3 I, 2020, the Company had net capital of \$28,276, which was \$23,276 in excess of its required minimum net capital of \$5,000. The Company's net capital ratio was .6701 to l. . .

Advances to affiliates, contributions, distributions and other withdrawals arc subject to certain notification and other requirements of Ruic l 5c3-l and other regulatory rules. The Company is exempt from the prnvisions of Rule l 5c3-3 under the Securities Exchange Act of 1934. The Company relics on its SEC Rule 15c3-3(k)(2)(ii) exemption.

#### **Note 4 - Concentrations**

#### Concentration of Cash

The Company maintains its cash at one financial institutions in amounts that at times may exceed federally insured limits. The Compa11y has not experienced any losses in such accounts through December 31, 2020. As of December 31, 2020 there were no cash balances held in any accounts that were not fully insured.

#### on ·cntralion of !earing Brok ·r C t C l.

The Company uses one clearing broker for all clearing services. At December 3 I, 2020 commissions receivable of \$6,893 was due from this broker.

The Company received revenue from three funds resulting in revenues exceeding ten percent of the Companies lotal revenues.

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#### **L.O. Thomas & Co., Inc.** Notes To Financial Statements December 31, 2020

#### **Note 5 - Fair Value**

Cash, receivables, accounts payable and other current liabilities are reflected in the financial statements at carrying value which approximates fair value because of the short-term maturity of these instruments.

#### **Note 6 - Commitments and Contingencies**

Pursuant to Securities and Exchange Commission Ruic I 5c3-I ( e )(2) the Company may not authorize distributions to its members if such distributions cause the Company's net capital to fall below 120% of the Company's minimum net capital requirement. As of December 31, 2020 the Company was not in violation of this requirement.

The Company had no lease or equipment rental commitments, no underwriting commi lrncnts, no contingent liabilities, and had not been named as a defendant in any lawsuit al December 31, 2020 or during the year then ended.

from time to time the Comp.my and its stockholders are the subject of litigation, inquires from Regulatory Agencies and arbitration claims. As of December 31, 2020 lhc Company is not a subject of litigation inquiries from any regulatory agencies or any other arbitration daims. ..

#### **Note 7 - Related Party Transactions**

Tht: Company leases office space from its sole stockholder under a month to montl1 operating lease. The lease requires monthly payments of \$2,800 with the lease to continue at the same rate on a year-to-year basis. The Company made lease payments of \$28,800 to the stockholder during the year. It is anticipated that in the normal course of business, leases that expire will be renewed or replaced \:vith similar leases.

In addition, the Company paid the stockholder a salary in the amount of \$51,140 and reimbursed the stockholder for various travel and overhead expenses.

#### **Note 8 - Antj-Money Laundering Policies and Procedures**

The Company is required to implement policies and procedures relating to anti-money laundering, compliance, suspicious activities, and currency transaction reporting and due diligence on customers who open accounts with lhc Company. At December 31, 2020 the Company had implemented such policies and procedures.

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

**L.O. Thomas & Co., Inc.** Notes To Financial Statements December 3 1, 2020

#### **Note 9 - Exemption from Rule 15c3-3**

The Company is exempt from the Securities and Exchange Commission Rule 15c3-3 and, therefore, is not required to maintain a "Special Reserve Bank Account for the Exclusive Benefit of Customer's".

#### **Note 10 - Subsequent Events**

The Company has evaluated subsequent events occurring after the statement of financial condition date through the date ofF ebmary 15, 2021 which is the date the financial statements were available to be issued. Based on this evaluation, the Company has determined that no subsequent events have occurred which require disclosure in or adjustment to the financial statements.

#### **Note 11 - COVJD 19**

In March 2020, the World Health Organization (WHO) declared COVID-19 a global pandemic. This pandemic event has resulted in signi<sup>f</sup> icant business disruption and uncertainty in both global and U.S. markets. While management believes the Company is in an appropriate position to wealher the potential short-tenn effects of t11cse world-wide events, the direct and long-term impact to the Company and its financial statementli is undctcnnined at this time.

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

**Supplementary Information Pursuant to Rule 17a-5 of the Securities Exchange Act of 1934** 

**As of December 31, 2020** 

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

### **L.0. Thomas** & **Co.,** Inc. COlVIPUTATION OF NET CAPITAL Year Ended December 31, 2020

Schedule I

# **COMPUTATION** OF **NET CAPITAL UNDER RULE 15c3-1 OF THE SECURITIES AND EXCHANGE COMMISSION**

| Total Credits<br>rom Statement of Financial Condition<br>or Net Capital<br>or net capital<br>Deduct ownership equity not allowable f<br>Total ownership equity qualified f<br>Total ownership equity f | \$<br>0<br>45.434<br>45,434 |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------|
| Total Debits<br>Liabilities sunordinated to claims of general creditors allowable<br>Other (deductions) or allowable liabilities<br>In computation of net capital<br>Add:                              | 0<br>0<br>10                |
| nd allowable subordinated liabilities<br>Total capital a                                                                                                                                               | 45,434                      |
| Total non-allowable assets from Statement of Financial Condition<br>Deductions and/or charges:                                                                                                         | (17,158)                    |
| ore haircuts on securities positions<br>Net Capital bef                                                                                                                                                | 28,2i6                      |
| omputed, where applicable, pursuant to 13c301(f):<br>Haircuts on securities (c                                                                                                                         | 0                           |
| Net Cap.ital                                                                                                                                                                                           | \$<br>28,276                |
| EMENTS<br>EQUIR<br>CAPITAL R                                                                                                                                                                           |                             |
| 6 2/3 % of aggregate indebtedness                                                                                                                                                                      | \$<br>1,263                 |
| Minimum capital requirement                                                                                                                                                                            | 5,000                       |
| pital in excess of requirements<br>Net ca                                                                                                                                                              | \$<br>23,276                |
| Ratio of Aggregate Indebtedness to<br>Net Capital                                                                                                                                                      | .6701 to 1                  |
| pany's Computation (included in<br>mber 31, 2020)<br>Part II of Form X-17A-5 as of Dece<br>Reconciliation with Com                                                                                     |                             |
| Net Capital, as reported in Company's Part II unaudited Focus Report                                                                                                                                   | \$<br>28,276                |
| Net Capital, per above                                                                                                                                                                                 | 28,276                      |
| Difference                                                                                                                                                                                             | \$                          |

There are no material differences between the net capital reflected in the above computation and the net capital reflected in the Company's FOCUS Repo11 as of December 31, 2020.

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#### SCHEDULE II COMPUTATION FOR DETERMINATION OF RESERVE REQUIREMENTS UNDER RULE 15c3-3 (EXEMPTION)

#### YEAR ENDED December 31, 2020

Pursuant to Rule l 7a-5( d) ( 4) of the audited computations of Net Capital pursuant to Rule 15c 3-1 and computation for Determination of Reserve requirements pursuant to Rule 15c 3-3 submitted by L.O. Thomas & Co., Inc., in my opinion no material differences exist which would materially effect the reserve requirements pursuant to Rule 15c 3-3 or its claim for exemption.

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

#### SCHEDULE III INFORMATION RELATING TO POSSESSION OR CONTROL REQUIREMENTS (EXEMPTION)

#### PURSUANT TO RULE 15c 3-3 of the Securities and Exchange Commission

#### As of December 31, 2020

#### **"EXEMPT UNDER 15c3-3(k)(2)(ii)**

Pursuant to rule 15c 3-3 relating to possession or control requirements, L.O. Thomas & Co., Inc. has not engaged in the clearing or trading of ·my securities and did not hold customer fonds or securities during the year ended December 31, 2020 and therefore is claiming exemption to this schedule pursuant to paragraph (k)(2)(ii) of SEC Rule 15c3-3. The firm's minimum net capital requirement pursuant to paragraph (a)(2)(vi) of SEC Rule l 5c3-l will be \$5,000.

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#### **MICHAELT. REMUS**  *(3e,i4',ed 'P«&k ,:4�*

P.O. Box 2555 Hamilton Square, NJ 08690 **Tel:** 609-540~ t 751 Fax: 609-570-5526

#### REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To: The Board of Directors and Stockholder of **L.O. Thomas** & **Co., Inc.**

I have reviewed management's statements, included in the accompanying Exemption Report, in which (1) LO. Thomas & Co., Inc. identified the following provisions of 17 C.F.R. § l 5c3-3(k) under which L.O. Thomas & Co., Inc. claimed an exemption from 17 C.F.R. §240.l5c3-3: under-k(2)(ii), (the .. exemption provisions") and (2) L.O. Thomas & Co., Inc. stated that L.O, Thomas & Co., Inc. met the identified exemption provisions throughout the most recent fiscal year without exception. L.0. Thomas & Co., Inc. management is responsible for compliance with the exemption provisions and its statements.

My review was conducted in accordance with the standards of the Public Company Accounting Oversight Board (United States) and, accordingly, included inquiries and other required procedures to obtain evidence about L.0. Thomas & Co., Inc. compliance with the exemption provisions. A review is substantial1y less in scope than an examination, the objective of which is the expression of an opinion on management's statements. Accordingly, 1 do not express such an opinion.

Based on my review, I am not aware of any material modifications that should be made to management's statements referred to above for them to be fairly stated, in all material respects. based on the provisions set forth in paragraph (k)(2)(ii) of Rule l 5c3-3 under the Securities Exchange Act of l 934.

*� 7. 'Rem«a* 

Michael T. Remus, CPA Hamilton Square, New Jersey February 15 , 202 l

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#### Exemption Statement pursuant to SEC Rule 17a-5 For the Year Ended December 31, 2020

#### STATE MENT OF EXEMPTION FROM SECRULE 15c3-3

L.O. Thomas & Co., Inc. (the "Company") is a registered broker-chaler subject to Rule 1 7a-5 promuliated by the Securities and Exchange Commission (17 C.F.R. 5240.17a-5, "Reports to be made by certain brokers and dealers"). This Exemption Report was prepared by 17 C. F.R. 5240.17a-5(d)(l) and (4). To the best of its knowledge and belief, the Company states the following:

- (1) The Company claimed an exemption from 17 C.F.R. 5240.15c3-3 under the following provisions of 17 C.F.R. 5240.15c3-3(k)(2)(ii).
- (2) The Companymet the identified exemption provisions in 17 C.F.R. §240.15c3-3(k)(2)(ii) throughout the most recent fiscal period without exception.

L.O. Thomas & Co., Inc.

I. John W. Risley, swear (or allirm) that, to my best knowledge and belief, this Exemption Statement is true and correct.

By:

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

**L.O. Thomas & Co., Inc.** SUPPLEMENT AL SIPC REPORT

DECEMBER 31, 2020

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

#### **l\llCHAEL T. REl\fUS**

P.O. Box 2555 Hamilton Square, NJ 08690 **Tel:** 609-540-1751 **Fax:** 609-570-5526

Report of Independent Registered Public Accounting Fim1 on Applying Agreed-upon Procedures

LO. Thomas & Co., Inc.

In accordance with Rule 17a-5(e)(4) under the Securities Exchange Act of 1934 and with the SIPC Series 600 Rules, I have performed the procedures enumerated below, which \Vere agreed to by LO. Thomas & Co., Inc. and and the Securities Investor Protection Corporation (SIPC) with respect to the accompanying General Assessment Reconciliation (Form SIPC-7) ofL.O. Thomas & Co., Inc. for the year ended December 31, 2020 , solely to assist you and SIPC in evaluating L.O. Thomas & Co., Inc. 's compliance with the applicable instructions of the General Assessment Reconciliation (Form SIPC-7). LO. Thomas & Co., Inc. management is responsible for the firms compliance with those requirements. This agreed-upon procedures engagement was conducted in accordance with attestation standards established by the Public Company Accounting Oversight Board (United States). The sufficiency of these procedures is solely the responsibility of those parties specified in this report. Consequently, I make no representation regarding the sufficiency ofthe procedures described below either for the purpose for which this report has been requested or for any other purpose. The procedures l pcrf<.lrmed and my findings are as follows:

- Compared listed assessment payments on SIPC-7 with respective cash disbursements journals, noting no differences: I.
- Compared the amounts reported on the audited Form X-17 A-5 for the year ended December 31, 2020, as applicable, wilh the amounts reported in Fonn SIPC-7 fi:)r the year ended December 31, 2020, noting no di ffercnccs: 2 ..
- 3. Compared any adjustments reported in Form SIPC-7 with supporting schedules and working papers, noting no differences, and
- 4. Proved the arithmetical accuracy of the calculations reflected in Form SJPC-7 and in the related schedules and working papers supporting the adjustments, noting no differences.

I was not engaged to, and did not conduct an examination, the objective of \vhich would be the expression of an opinion on compliance. Accordingly, I do not express such an opinion. Had I performed additional proccdm-cs, other matters might have come to my attention lhal would have been reported to you.

This report is intended solely for the information and use of the specified pa1iics listed above and is not intended to be and should not be used by anyone other than these specified parties.

Michael T. Remus, CPA Hamilton Square, New Jersey February 15, *1021*

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#### L.O. Thomas & Co., Inc. SIPC General Assessment Reconciliation December 31, 2020

| General Assessment Calculation |                    |
|--------------------------------|--------------------|
| Total Revenue                  | الحمل<br>1.237.915 |
| Deductions                     | (1,109,561)        |
| SIPC Net Operating Revenues    | 128-354            |
| Rate                           | (1.00) -           |
| General Assessment Due         | ો છે ર             |
| Less Pavments: SIPC 6          | (88)               |
| Plus: Interest                 |                    |
| Remaining Assessment Due       | 105                |
| Paid with SIPC 7               | (104)              |
| Balance Due                    | క్రిత్త<br>l       |

There is no material difference between the SIPC-7 and this reconciliation.

See Independent Accountants' Report.

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