# BROOKWOOD ASSOCIATES, L.L.C. X-17A-5 (2024-02-08) — Broker-dealer annual report - Company: BROOKWOOD ASSOCIATES, L.L.C. - Form: X-17A-5 - Filed: 2024-02-08 - Period: 2023-12-31 - Accession: 0000860681-24-000002 - CIK: 860681 - File #: 8-42303 - Type: Broker-dealer - Material weakness: No - Auditor: GreerWalker LLP - Auditor location: Greensboro, SC - Contact: Amanda Spence - Phone: 4048633060 - Signed by: Robert Winborne (president) Original filing: https://www.sec.gov/Archives/edgar/data/860681/000086068124000002/formx17apub.pdf --- {0}------------------------------------------------ | UNITED STATES | | | | | |------------------------------------|--|--|--|--| | SECURITIES AND EXCHANGE COMMISSION | | | | | | Washington, D.C. 20549 | | | | | [ PUBLIC ] ### ANNUAL REPORTS FORM X-17A-5 PART III | OM& APPROVAL | | |---------------------------|--| | OMB Number: 3235-0123 | | | Expires: Oct 31, 2023 | | | Estimated average burden | | | hours per response:
12 | | | SFC FILE NUMBER | | | | | 8 42303 FACING PAGE | | Information Required Pursuant to Rules 17a-12, and 18a-7 under the Securities Exchange Act of 1934 | | | | | |--------------------------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------------------------|--|--|--| | | FILING FOR THE PERIOD BEGINNING 01/01/2023 AND ENDING 12/31/2023
MM/DD/YY | MM/DD/YY | | | | | A. REGISTRANT IDENTIFICATION | | | | | | | NAME OF FIRM: Brookwood Associates, LLC | | | | | | | TYPE OF REGISTRANT (check all applicable boxes): | B Broker-dealer - [ ] Security-based swap dealer - O Major security-based swap participant
Check here if respondent is also an OTC derivatives dealer | | | | | | | ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use a P.O. box no.) | | | | | | 3575 Pledmont Center, Bldg 15, Suite 820 | (No. and Street) | | | | | | Atlanta
(City) | Georgia
(State) | 30067
(Zip Code) | | | | | PERSON TO CONTACT WITH REGARD TO THIS FILING | | | | | | | Robert Winborne
(Name) | 404-874-7433
(Area Code - Telephone Number) | rw@brookwood associates.com
(Email Address) | | | | | | B. ACCOUNTANT IDENTIFICATION | | | | | | GreerWalker, LLP | INDEPENDENT PUBLIC ACCOUNTANT whose reports are contained in this filing" | | | | | | | (Name - If individual, state last, first and middle) | | | | | | (Address) | Wells Fargo Center, 15 South Main St, Suite 800, Greenville, SC
(City) | (Zip Code)
(State) | | | | | June 7, 2005 | 29501 | 2324 | | | | | (Date of Registration with PCAOB)(if applicable) | | (PCAOB Registration Number, if applicable) | | | | | | FOR OFFICIAL USE ONLY | | | | | | CFR 240.17a-5(e)(1)(ii), If applicable. | " Claims for exemption from the requirement that the annual reports of an independent public
accountant must be supported by a statement of facts and circumstances relied on as the basis of the exemption. See 17 | | | | | 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. {1}------------------------------------------------ ### OATH OR AFFIRMATION I, Kobert Will n be ne were swear (or affirm) that, to the best of my knowledge and belief, the financial report pertaining to the firm of Brook Wood Associates, LCC as of 1) ecomber 31 3, 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 proprietary interest in any account classified solely as that of a customer. ![](_page_1_Picture_3.jpeg) Signature: Title · Prosident Notary Public ### This filing \*\* contains (check all applicable Bollege) == } - (a) Statement of financial condition. - 2 (b) Notes to consolidated statement of financial condition. - [ (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). - O (d) Statement of cash flows. - [ (e) Statement of changes in stockholders' or partners' or sole proprietor's equity. - [ (f) Statement of changes in liabilities subordinated to claims of creditors. - [ (g) Notes to consolidated financial statements. - [ (h) Computation of net capital under 17 CFR 240.15c3-1 or 17 CFR 240.18a-1, as applicable. - [i) Computation of tangible net worth under 17 CFR 240.18a-2. - [] Computation for determination of customer reserve requirements pursuant to Exhibit A to 17 CFR 240.15c3-3. - [ {k) Computation for determination of security-based swap reserve requirements pursuant to Exhibit B to 17 CFR 240.15c3-3 or Exhibit A to 17 CFR 240.18a-4, as applicable. - [ (I) Computation for Determination of PAB Requirements under Exhibit A to § 240.15c3-3. - [ (m) Information relating to possession or control requirements for customers under 17 CFR 240.15c3-3. - [ (n) Information relating to possession or control requirements for security-based swap customers under 17 CFR 240.15c3-3(p)(2) or 17 CFR 240.18a-4, as applicable. - [] (o) Reconciliations, including appropriate explanations, of the FOCUS Report with computation of net capible net worth under 17 CFR 240.15c3-1, 17 CFR 240.18a-2, or 17 CFR 240.18a-2, as applicable, and the reserve requirements under 17 CFR 240.15c3-3 or 17 CFR 240.18a-4, as applicable, if material differences exist, or a statement that no material differences exist. - [p) Summary of financial data for subsidiaries not consolidated in the statement of financial condition. - (q) Oath or affirmation in accordance with 17 CFR 240.17a-5, 17 CFR 240.17a-12, or 17 CFR 240.18a-7, as applicable. - [ (r) Compliance report in accordance with 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable. - [ {s) Exemption report in accordance with 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable. - @ (t) Independent public accountant's report based on an examination of the statement of financial condition. - [ {u] Independent public accountant's report based on an examination of the financial statements under 17 CFR 240.17a-5, 17 CFR 240.18a-7, or 17 CFR 240.17a-12, as applicable. - [v] Independent public accountant's report based on an examination of certain statements in the compliance report under 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable. - O (w) Independent public accountant's report based on a review of the exemption report under 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable. - | {x| Supplemental reports on applying agreed-upon procedures, in accordance with 17 CFR 240.17-12, as applicable. - [ (y) Report describing any material inadequacies found to have existed since the date of the previous audit, or a statement that no material inadequacies exist, under 17 CFR 240.17a-12(k). - O (z) Other: - \*\* To request confidential treatment of chis filing, see 17 CFR 240.17a-5(e)(3) or 17 CFR 240.18a-7(d)(2), as applicable. {2}------------------------------------------------ # **Brookwo dAss at s** # **Brookwood Associates, L.L.C. Financial Statement** **December 31, 2023** Filed as PUBLIC pursuit to Rule I 7a-S(e)(3) under the Securities Exchange Act of 1934, {3}------------------------------------------------ ### **Table of Contents December 31, 2023** | Report oflndependent Registered Public Accounting Firm | | | | | |--------------------------------------------------------|----------------------------------|-----|--|--| | Financial Statement | | | | | | | Statement of Financial Condition | 2 | | | | | Notes to Financial Statement | 3-8 | | | {4}------------------------------------------------ ![](_page_4_Picture_0.jpeg) ### REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Members of Brookwood Associates, L.L.C.: ### **Opinion on the Financial Statement** We have audited the accompanying statement of financial condition of Brookwood Associates, L.L.C. (the "Company") as of December 31, 2023, and the related notes to the financial statements (collectively referred to as the "financial statements"). In our opinion, the financial statement presents fairly, in all material respects, the financial position of the Company as of December 31, 2023, in conformity with generally accepted accounting principles 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 provides a reasonable basis for our opinion. We have served as the Company's auditors since 2021 . *~J,L\_* Certified Public Accountants February 5, 2024 Greenville, SC **GreerWalker LLP** I **GreerWalker Corporate Finance LLC** I **greerwalker.com Charlotte Office** The Carillon I 227 West Trade St., Suite 1100 I Charlotte, NC 28202 I USA I Tel 704.377.0239 **Greenville Office** Wells Fargo Center I 15 South Main St. , Suite 800 I Greenville, SC 29601 I USA I Tel 864.752.0080 {5}------------------------------------------------ # Statement of Financial Condition December 31, 2023 ### Assets | Cash and cash equivalents | \$1,355.979 | |------------------------------------------|-------------| | Accounts receivable | 31,802 | | Property, furniture & equipment, net | 4,660 | | Prepaid expense | 25,167 | | Operating lease right of use assets, net | 46.605 | | Total assets | \$1,464,213 | | Liabilities and Members' Equity | | | Liabilities | | | Accounts payable and accrued liabilities | \$124,115 | | Deferred revenue | 21.250 | | Operating lease liabilities | 52,253 | | Total liabilities | 197,618 | | Members' equity | | | Total liabilitjes and members' equity | \$1,464,213 | The accompanying notes are an integral pa1t of these financial statements. 2 {6}------------------------------------------------ ### **Notes to Financial Statements For the year ended December 31,2023** ### **1. Organization and Summary of Significant Accounting Policies** Brookwood Associates, L.L.C. (the Company) was organized in 2000 pursuant to the provisions of the Georgia Business Corporation Code, and provides merger iind acquisition services and financing services to middle-market companies. The Company operates from an office in Atlanta. Georgia and is registered with the Securities and Exchange Commission ("SEC") and the Fimmcial Industry Regulatory Authority as a broker· dealer. #### **Basis of Accounting** The accompanying financial statements have been prepared on accordance with the accounting principles genernlly accepted as determined by the Financial Accounting Standards Standurds Codification ("ASC"). the accrual basis of accounting in in the United States ("GAAP") Board ("FASB") Accounting ### **AdoJ>tion of New Accounting Standnrd** On January I, 2023, the Company adopted Accounting Standards Update ("ASU") 2016- l 3, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments ASC 326. This standard replaced the incurred loss methodology with an expected loss methodology that is referred to as the current expected credit loss ("CEGL") methodology. CECL requires an estimate of credit losses for the remaining estimated lite of the financial asset using l1istorical experience, current conditions and reasonable and supportable forecasts and geocrnlly applies to financial assets measured at amo1tized cost and some off-balance sheet credit exposures snch as unfonded commitments to extend credit. Financial assets measured at amortized cost will be presented at the net amount expected to be collected by using an allowance for credit losses. The Company adopted ASC 326 and all related subsequent amendments thereto effective January I, 2023 using the modified retrospective approach for all financial assets measured at amortized cost and off-balance sheet credit exposures. The impact of the adoption was not considered material to the financial statements and primarily resulted in enhanced disclosures. ### **Use ot'Estinrntes** The preparation of financial statements rn conformity with GAAP, whic:h requires management to make cstimate-s and assl1mptio11s that affect the reported amount of 11ssets and liabilities and the disclosure of contingent assets and liabilities at the dali: of the financial statements, and the reported amount of revenues and expenses during the reported periods. Actual results could differ from these estimates. {7}------------------------------------------------ # **Brookwood Associates, L.L.C. Notes to the Financial Statements For the Year Ended Decem her 31, 2023** ### **1. Organization and Summary of Significant Accounting Policies (continued)** ### **Cash and Cash Equivalents** Cash represents withdrawable deposits in both interest and non-interest bearing accounts. From time to time, balances in interest bearing accounts may exceed federally insured limits. Included in cash is \$1,355,979 of funds held in money market accounts held in federally insured financial institutions as of December 3 I, 2023. ### **Accounts Receivable** The Company extends credit to its customers under standard payment terms, generally requiring payment within 30 days from the invoice date. As of December 31, 2023, no allowance for credit losses was recorded by the Company. The Company recognizes the amount of change in current expected credit losses as an allowance gain or loss in operating expenses in the accompanying statement of income and changes in members' equity. For the year ended December 31, 2023, there were no allowance gains or losses recorded by the Company. Accounts are written-off against the allowance when the Company has no reasonable expectation of recovering the receivable, either in its entirety or a portion thereof. Management estimates the allowance for expected credit losses by applying historical credit loss rates to accounts receivable aging categories. Management considers historical loss information to be a reasonable basis for its estimate as the composition of accounts receivable and the risk characteristics of its customers and lending practices have not changed significantly over time. Jn addition, accounts are pooled by aging category as the change in risk characteristics is similar as accounts age. Management has determined that the current and reasonable and supportable forecasted economic conditions are consistent with the economic conditions included in the historical information. ### **Revenue and Expense Recognition** The Company enters into agreements, primarily with corporate clients, to provide merger and acquisition, capital raising, and other financial advisory services. These engagements may span one or more years. The Company recognizes revenue from these agreements ratably over applicable contract periods or as services are performed. Amounts billed and collected before the services are performed are included in deferred revenue when material. Contingent fees related to financing and merger and acquisition transactions are recognized when the transactions are closed. Reimbursements of expenses by clients offset the related expenses are included in operating expenses. During 2023, three clients had fees exceeding I 0% of total client revenue, which accounted for approximately 66% of revenue. {8}------------------------------------------------ ### **Notes to Financial Statements For the year ended December 31,2023** ### **1. Organization and Summary ofSignificant Accounting Policies (continued)** ### **Revenue and Expense Recognition (continued)** Under ASC Topic 606, the Company must identify the contract with a customer, identi1Y the performance obligations in the contrnct., determine the transaction price. allocate the transaction price to the performance obligations in the contrnct, and recognize rcvem1e when (or as) the Company satisfies a performance obligation. The Company's revenues are generated primarily through merger and acquisition related advisol)1 and consulting services. The Company receives advisory foes to cornptmsate for the substantial research and analysis performed as part of the underlying transactions. The Company believes the performance obligation for providing advisory ,ind consulting services is s«tisfied over time becm1se the customer is receiving and consuming the benefits as they are provided by the Company . Fees arc received throughout the year and are recognizut in the period for which the advisory services are provided. The Company also provides advisory services related to mergers and acquisitions and ra1s111g capital. Revenue earned for successful closing of transactions are recognized at the point in time that performance under the arrangement is completed (the closing elate of the tr~nsaction). In some circumstances, significant judgment is needed to determine the timing and measure of progrnss appropriate for revenue recognition under a specific contract. Retainers and other fees received from customers prior to recogni;,;ing revenue are n:Jlcctt:d as contract liabilities and recorded as dtJforn:d revenue until earned by the Company. As of December 3 J, 2023 and 2022, the Company recorded deferred revenue of \$21,250 and \$194,028, respectively. During the year ended December 3 J, 2023 , the Company recognized \$193,611 of the deferred revenue balance as of December 31, 2022, As of December 31, 2023 and 2022, the Company recorded accounts receivable of \$31,802 and \$25,000, re'.,pcctively. #### **Income Taxes** The Company is a limited liability company and, as such, its earnings tlow through directly to the members. Differences existing in the book and tax basis of assets and liabilities relnte primarily to differences in revenue recognition policies for financic1l reporting and tax purposes. {9}------------------------------------------------ ### **Notes to Financial Statements For the year ended December 3·1,2023** ### **1. Organization and Summary of Significant Accounting Policies ( continued)** ### **Income Taxes (continued)** Management of the Company considers the likelihood of changes by laxing aL1thorities in its filed income tax returns and discloses potential significant changes that management believes are more likely than not to occw· upon examination by tax authorities. Managem0nt has not iden1ificd any uncertain \ax positions in its filed income tax returns that require djsclosure in the nccompanying financial statements. The Company's incorm: tax returns for the past three years are subject to examination by tax authorities. and may change upon examination. ### **Property, Furniture, and Equipment** Properly, furniture, and equipment are carried at cost l~ss accumulated depreciation. Depreciation is provided using the straight-line method over useful lives ofthree to seven years. ### **Subsequent Events** Managemen1 evaluates events occurring subsequent to the date of1he financial statemen1s in determining the accounting for and disclosure of transactions 11nd events that affec1 the financial statements. Subsequent events have been evaluated through the date 1he financial statements were issued. ### **2. Property, Furniture and Equipment** Property, furniture and equipment consist oHhe following at December 31, *2023:* | Furni1ure and fixtures | \$88,335 | |---------------------------------------|--------------| | Computers and office equipment | 61,770 | | Leasehold improvements | ___ 17.lh.~. | | | 167,-1(18 | | Less accumulated depret:iation | (l<•'.UIOK) | | Net property, furni1ure and equipment | \$4,660 | Depreciation expense for the year ended December 31, 2023 amounted to \$7.798. ### **3. Employee Benefit Plan** The Company has established an employee retirement plan (the Plan) under Section 40 I (k) of the Internal Revenue Code covering substantially all employees. The Company does not match the contributions made by the employees or make profit-sharing contributions lo the Plan. {10}------------------------------------------------ ### **Notes to Financial Statements For the year ended December 31, 2023** ### **4. Operating Leases** At December 31, 2023, the balance ofthe operating lease right ofuse aSSl't - office lease was \$42,829 and the remaining operating lease liability - office lease was \$48,477. These amounts represent the net present value of the required lease payments related to the office lease, calculated using a discount rate of 7.5%. During 2023, the Company made cash paymenrs of \$144, I 14 and recognized rent expense \$130,778 related to the office lease. At December 31, 2023, the remaining term of the of/ice lease was 4 months. The non-lease component of the office lease, common area maintenance, is a variable payment and is not included in the measurement ofthe right ofuse asset nor the lease liability, At December 31, 2023, the balance of the operating lease right of use asset - copier was \$3,776 and the remaining operating lease liability - copier was \$3,776. These amounts represent the net present value of the required copier lease payments calculated using a discount rate of 7.5%. At December 31, 2023, the remaining lease term for the copier was 9 months. The copier lease lrns no variable nor non-lease components. During 2023, the Company made cash payments of \$5,194 and recognized rent expense of \$5,194 related to the copier lease. The copier lease agreement does not include an option to extend or renew the lease term. On January 5 2024, the Company entered into a twelve month office lease with monthly payments of\$ l 2,909. This lease commences on May I, 2024 and expires on April 30, 2025. Reconciliation of rem11ining undiscounted cash flows to year end lease liabilities: | | | Otlicc I .cn~c _,. l'OJJi~r 1.~•n111.•_ | ' --
--·-· T >IH( | | |-----------------------------|----------------|-----------------------------------------|-----------------------|--| | Cash outflow 2024 | \$49,239 | \$3,894 | S53,133 | | | Cash outtlow 2025 | 0 | 0 | 0 | | | Cash outtlow 2026 | 0 | 0 | 0 | | | Cash outflow 2027 | D | D | 0 | | | Less present value discount | (W | ( II | 81!.L | | | Lease Liability I 2/3 l /23 | --
\$48,477 | \$3,776 | \$52.253 | | ### **5. Members' Equity** | | | | TCIIUI | |--------------|-----------|--------------------|----------------------------------------------| | \$2.31fS,'85 | | | \$2,R28 , 14J | | (427,615) | 614,6~2 | 615,791 | 802,858 | | (1,286,906) | (552.500) | (525,000) | (2,364,406) | | \$ 794,334 | \$213,906 | \$258,355 | \$1,266,595 | | | Closs A | Clll8S 0
5--· - | Class C
. ffi.724 ___
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- | {11}------------------------------------------------ ### **Notes to Financial Statements For the year ended December 31, 2023** ### **5. Members' Equity (continued)** The Class A members have the rights to vote, to consent or withhold consent, to participate in decisions relating to the business and affairs of the Company, and to participate in making designations and elections. The Class B and Class C members have no such rights. The members are subject to the Company's operating agreement which stipulates, among other things, the terms under which income and losses are allocated to the different classes of member units, distributions are made, membership interests can be transferred, and new members can be admitted ### **6. Commitments and Contingencies** The Company is involved in various claims or actions arising in the normal course of business. lt is management's opinion that the resolution of these matters will not materially affect the Company's financial position or the results of its operations .. ### **7. Other Accounting Pt'Onouncements** Accounting standards that have been issued or proposed by FASB or other standard-setting bodies are not expected to have a material impact on the Company's financial position, results of operations or cash flows. ### **8. Net Capital Requirement** The Company is subject to the SEC's Uniform Net Capital Rule (SEC Rule 1Sc3-l), 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 JS to I. As of December 3 J, 2023, the Company Jrncl net capital of \$1,204,966 which was \$! , 199,663 in excess of its required net capital of \$5,303. The Company's ratio of aggregate indebtedness to net capital was .066 to J. Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.