# NOLAN SECURITIES CORP. X-17A-5 (2021-03-31) — Broker-dealer annual report
- Company: NOLAN SECURITIES CORP.
- Form: X-17A-5
- Filed: 2021-03-31
- Period: 2020-12-31
- Accession: 0000870702-21-000002
- CIK: 870702
- File #: 8-43354
- Material weakness: No
- Auditor: Fulvio and Associates LLP
- Auditor location: New York, NY
- Contact: Leonard Schwalb
- Phone: 212-772-3416
- Website: fulviollp.com
- Signed by: Bruce Kelly (CEO)
Original filing: https://www.sec.gov/Archives/edgar/data/870702/000087070221000002/kellypub_.pdf
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KELLY SECURITIES CORPORATION DIBIA NOLAN SECURITIES CORPORATION FINANCIAL STATEMENT DECEMBER31, 2020
This report is filed as a PUBLIC document in accordance with Rule 17a-5(e)(3) under the Securities Exchange Act of 1934.
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UNITEDSTATES SECURITlESAND EXCHANGE COMMISSION Washington, D.C. 20549
OMB APPROVAL OMBNumber: 3235-0123 Expires: October 31, 2023 Estimated average burden hours oerresponse ...... 12.00
SEC FILE NUMBER
8-43354
# **ANNUAL AUDITED REPORT FORM X-17 A-5 PART Ill**
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 01/01/2020 | | AND ENDING 12/31/2020
~~~~~~~~~~- | | |
|--------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------|--------------------------------------|------------------------------------|--|
| | MM/DD/YY | | MM/DD/YY | |
| | A. REGISTRANT IDENTIFICATION | | | |
| NAME OF BROKER-DEALER: Nolan Securities Corporation
ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use P.O. Box No.) | | | OFFICIAL USE ONLY
FIRM l.D. NO. | |
| | | | | |
| 535 Main Road | | | | |
| | (No. and Street) | | | |
| Monterey | MA | | 01245 | |
| (City) | (State) | | (Zip Code) | |
| NAME AND TELEPHONE NUMBER OF PERSON TO CONTACT IN REGARD TO THIS REPORT
Leonard Schwalb | | | 212-772·3416 | |
| | | | (Area Code - Telephone Number) | |
| | B. ACCOUNTANT IDENTIFICATION | | | |
| INDEPENDENT PUBLIC ACCOUNTANT whose opinion is contained in this Report* | | | | |
| | | | | |
| Fulvio and Associates, LLP | | | | |
| | (Name - if individual, state last, first, middle name) | | | |
| 5 West 37th Street | New York | NY | 10018 | |
| (Address) | (City) | (State) | (Zip Code) | |
| CHECK ONE: | | | | |
| j ,f I | | | | |
| Certified Public Accountant | | | | |
| Public Accountant | | | | |
| a | 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 public accountant 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 141 0 (11-05)
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### **OATH OR AFFIRMATION**
| I, Bruce Kelly | , swear (or affirm) that, to the best of | | | |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--|--|--|
| my knowledge and belief the accompanying financial statement and supporting schedules pertaining to the firm of
Nolan Securities Corporation
~~~~~~~-'--~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ , 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 follows: | | | | |
| | | | | |
| NOTARY PUBLIC-STATE OF NEW YORK | | | | |
| No. 01BA6399087 | | | | |
| Qualified in New York County | | | | |
| My commission Expires 1O·1 6·2023 | | | | |
| | Title | | | |
| tf7htft, | | | | |
| Notary Public | | | | |
| This report•• contains (check all applicable boxes):
0 (a) Facing Page.
0 (b) Statement of Financial Condition.
(
of Comprehensive Income (as defined in §210.1-02 ofRegulation S-X).
§
d)Statement of Changes in Financial Condition.
(f) Statement of Changes in Liabilities Subordinated to Claims of Creditors.
§ (g) Computation of Net Capital.
(h) Computation for Determination of Reserve Requiremen!s PursuanUt to Rule l 5c3-3.
(i) Information Relating to the Possession or Control Requirements
consolidation.
§ (I) An Oath or Affirmation.
(m) A copy of the SIPC Supplemental Report. | O (c) Statement oflncome (Loss) or, if there is other comprehensive income in the period(s) presented, a Statement
(e) Statement of Changes in Stockholders' Equity or Partners' or Sole Proprietors' Capital.
nder Rule 15c3-3.
0 (j) A Reconciliation, including appropriate explanation of the Computation ofNet Capital Under Rule l 5c3-1 and the
Computation for Determination of the Reserve Requirements Under Exhibit A of Rule 15c3-3.
O (k) A Reconciliation between the audited and unaudited Statements of Financial Condition with respect to methods of
(n) A report describing any material inadequacies found to exist or 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. I 7a-5(e)(3). | | | |
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# FU L VI 0 & AS S 0 C I AT E S . L.L.P.
*Certified Public Accountants*
--------- NcwYork Office: 5 West 31th Stttct, 4th Floor New York, New York 10018 TEL: 212-490-3113 FAX: 212-575-5159 www.fulviollp.com
Connecticut Office: 95B Rowayton Avenue Rowayton, CT 06853 TEL: 203-857-4400 f/\X: 203-857-0280
# REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Stockholder
of Kelly Securities Corporation D/B/A Nolan Securities Corporation
# Opinion on the Financial Statement
We have audited the accompanying statement of financial condition of Kelly Securities Corporation DIBIA Nolan Securities Corporation (the "Company") as of December 31, 2020, and the related notes (collectively referred to as the "financial statemenf,). In our opinion, the financial statement presents fairly, in all material respects, the financial position of the Company as of December 31, 2020 in conformity with accounting principles generally accepted in the United States of America.
## Basis for Opinion
This financial statement is the responsibility of the Companis management. Our responsibility is to express an opinion on the Company'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 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 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 the Company's auditor for the fiscal years 2006 to 2015 and 2018 to 2020.
New York, New York March 30, 2021
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# KELLY SECURITIES CORPORATION D/B/ A NOLAN SECURITIES CORPORATION STATEMENT OF FINANCIAL CONDITION DECEMBER 31, 2020
# ASSETS
| Current Assets: | | |
|------------------------------------------------------------|----|--------------|
| Cash and cash equivalents | | 400,003 |
| Fees receivable | | 384,078 |
| Prepaid expenses | | 16,986 |
| Total Current Assets | | 801,067 |
| Non-Current Assets: | | |
| Fees receivable | | 57,500 |
| Fixed assets (net of accumulated depreciation of \$93,893) | | 83,352 |
| Total Non-Current Assets | | 140,852 |
| TOT AL ASSETS | | 941,919 |
| LIABILITIES AND STOCK.HOLDER'S EQUITY | | |
| Current Liabilities: | | |
| Accounts payable and accrued expenses | | 35,502 |
| Consulting fees payable | | 192,550 |
| Total Current Liabilities | | 228,052 |
| Long Term Liabilities: | | |
| Consulting fees payable | | 28,750 |
| TOTAL LIABILITIES | | 256,802 |
| Stockholder's equity | | |
| Common stock, no par value, I 00 shares authorized | | |
| issued and outstanding | | 5
600,149 |
| Additional paid-in-capital
Retained earnings | | 84,963 |
| Total stockholder's equity | | 685,117 |
| TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY | \$ | 941,919 |
The accompanying notes are an integral part of this financial statement.
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# KELLY SECURITIES CORPORATION D/B/ A NOLAN SECURITIES CORPORATION NOTES TO FINANCIAL STATEMENT DECEMBER 31, 2020
#### NOTE I. ORGANIZATION AND NATURE OF BUSINESS
### Organization
Kelly Securities Corporation D/B/A Nolan Securities Corporation (the "Company") is a broker/dealer, registered with the Securities and Exchange Commission (the "SEC") and is a member of the Financial Industry Regulatory Authority, Inc. (the "FINRA").
### Nature of Business
The Company's purpose is to advise other companies on all financial matters, including advice on financing, securities offerings and private placement of securities. The Company does not carry customer accounts or perform custodial functions related to customer securities.
#### NOTE2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
### Basis of Presentation
The financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP).
### Cash and cash equivalents
AU short-term investments with an original maturity of three months or less are considered to be cash equivalents. The Company maintains cash balances in bank accounts which, at times, exceed the FDIC insurance limits.
### Revenue Recognition
The Company recognizes revenue from its services on a pro-rata basis over the term of the contract, which approximates when s~rvices are performed, in compliance with the newly effective revenue recognition rules. The core principal of the standard is that an entity should recognize revenue to depict the transfer of promised goods and services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods and services.
Revenues under Topic 606 require financial advisory and placement fees to be recognized either at a "point in time" or "over time", depending on the facts and circumstances of the arrangement, and evaluated using a five-step model.
Investment banking fees are recorded upon either the closing of the transaction or a written commitment from the investor. Consulting fee income is recorded when processed, as applicable, calculated in either case as a percentage of the capital commitment made by an investor.
### Depreciation
The cost of fixed assets is depreciated over their estimated useful lives on a straight line basis. Fixed assets costing \$1,000 or less are expensed.
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### (continued)
### NOTE2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
### Fair Value Measurement - Definition and Hierarchy
F ASB 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 are consistent with the market, income or cost approach, as specified by F ASB ASC 820, are 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 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities the Company has the ability to access.
Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.
Level 3 are unobservable inputs for the asset or liability and rely on management's own assumptions about the assumptions that market participants would use in pricing the asset or liability. The unobservable inputs should be developed based on the best information available in the circumstances and may include the Company's own data.
FASB ASC 820, *Fair Value Measurement* has no material effect on these financial statements.
The Company did not hold any securities as of December 31, 2020.
# Concentration of Credit Risk
The Company is engaged in various investment and brokerage activities in which counterparties primarily include broker-dealers, banks, and other financial institutions. In the event counterparties do not fulfill their obligations, the Company may be exposed to risk. The risk of default depends on the creditworthiness of the counterparty or issuer of the instrument. It is the Company's policy to review, as necessary, the credit standing of each counterparty. During the year ended December 31, 2020, the Company earned fee income from two clients, approximately 50% from each. At December 31, 2020, one client accounted for 93% of total fees receivable.
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# KELLY SECURITIES CORPORATION D/B/ A NOLAN SECURITIES CORPORATION NOTES TO FINANCIAL STATEMENT DECEMBER 31, 2020 (continued)
### NOTE3. INCOME TAXES
For income tax purposes, the shareholder has elected that the Company be treated as an "S" corporation under Subchapter S of the Internal Revenue Code and for state income taxes. Accordingly, no provision has been made for both Federal and state income taxes since the net income or loss of the Company is to be included in the tax return of the individual shareholder. .
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 tax positions will be sustained upon examination based on the facts, circumstances, and information available at the end of the period. The measurement of unrecognized tax benefits is adjusted when new information is available, or when an event occurs that requires a change.
The Company has determined that there are no uncertain tax positions which require adjustment or disclosure on the financial statements.
#### NOTE4. NET CAPITAL REQUIREMENTS
The Company is subject to the SEC Uniform Net Capital Rule (SEC Rule l5c3-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 15 to 1 (and the rule of the 'applicable' exchange also provides that equity capital may not be withdrawn or cash dividends paid if the resulting net capital ratio would exceed 10 to 1). At December 31, 2020, the Company had net capital of \$363,990, which was \$346,870 in excess of its required net capital of \$17,120. The Company's net capital ratio was .71to1.
#### NOTE 5. FIXED ASSETS
Fixed assets at December 31, 2020 consist of the following:
| | | Estimated Useful Life |
|--------------------------------|--------------|-----------------------|
| Automobile | \$ 114,614 | 5 Yrs. |
| Office equipment | 10,380 | 3-5 Yrs. |
| Furniture and fixtures | 37,452 | 7 Yrs. |
| Artwork | 14,799 | 7 Yrs. |
| | 177,245 | |
| Less: Accumulated Depreciation | (93,893) | |
| | \$
83,352 | |
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# KELLY SECURITIES CORPORATION D/BI A NOLAN SECURITIES CORPORATION NOTES TO FINANCIAL STATEMENT DECEMBER 31, 2020 (continued)
### NOTE 5. FIXED ASSETS (continued)
Fixed assets are recorded at cost. The cost of fixed assets is depreciated over the estimated useful lives of the related assets utilizing the straight-line method.
#### NOTE6. RELATED PARTY TRANSACTIONS
The Company has an expense sharing arrangement with its sole stockholder. The arrangement provides that the stockholder shall pay the occupancy expense of the office and allocate it to the Company as a contribution of capital. For the year ended December 31, 2020, such.expense amounted to \$36,000.
Additionally, for the year ended December 31, 2020, consulting fees of \$123,000 were paid to related parties.
### NOTE 7. OFF BALANCE SHEET RISK
The Company provides representations and warranties to counterparties in connection with a variety of commercial transactions and occasionally indemnifies them against potential losses caused by the breach of those representations and warranties. The Company may also provide standard indemnifications to some counterparties to protect them in the event additional taxes are owed or payments are withheld, due either to a change in or adverse application of certain tax laws. These indemnifications generally are standard contractual terms and are entered into in the normal course of business. The maximum potential amount of future payments that the Company could be required to make under these indemnifications cannot be estimated. However, the Company believes that it is unlikely it will have to make material payments under these arrangements and has not recorded any contingent liability in the fmancial statements for these indemnifications.
### NOTE 8. USE OF ESTIMATES
The preparation of financial statements in conformity with U.S. GAAP requires the Company's 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.
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# KELLY SECURITIES CORPORATION D/B/ A NOLAN SECURITIES CORPORATION NOTES TO FINANCIAL STATEMENT DECEMBER 31, 2020 (continued)
### NOTE9. GUARANTEES
FASB ASC 460, *Guarantees,* requires the Company to disclose information about its obligations under certain guarantee a1Tangements. F ASB 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 failure to perform under an agreement, as well as indirect guarantees of the indebtedness of others.
Except for the indemnifications described in Note 7, the Company has issued no guarantees at December 31 , 2020 or during the year then ended.
### NOTE 10. COMMITMENTS AND CONTINGENT LIABILITIES
The Company had no lease or equipment rental commitments, no underwriting commitments, no contingent liabilities, and bad not been named as defendant in any lawsuit at December 31, 2020 or during the year then ended.
### NOTE 11. SHORT-TERM LOAN RECEIVABLE
It is the Company's policy to make advances to commissioned brokers. These advances are repaid as commissions are earned. As of December 31, 2020 the Company has no outstanding advances.
#### NOTE 12. SUBSEQUENT EVENTS
Subsequent events have been evaluated through March 30, 2020 which is the date the financial statements were available to be issued.
During 2020, the Company was examined by FINRA, a designated examining authority. On March 22, 2021, as a result of the findings from this examination, the Company was fined \$5,000 for failure to provide for annual independent testing of its anti-money laundering compliance program. Additionally, for engaging in activities at the Company that require registration as an Investment Banking Representative, despite not being registered with FINRA in that capacity, the President of the Company was fined \$5,000 and suspended, for two months effective April 19, 2021 , from all registration capacities.
No other events were identified which require disclosure.
Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.