# DIVERSIFIED RESOURCES, LLC X-17A-5 (2022-02-28) — Broker-dealer annual report - Company: DIVERSIFIED RESOURCES, LLC - Form: X-17A-5 - Filed: 2022-02-28 - Period: 2021-12-31 - Accession: 0000898635-22-000001 - CIK: 898635 - File #: 8-45497 - Type: Broker-dealer - Material weakness: No - Auditor: Sandler & Company, P.C. - Auditor location: Needham, MA - Contact: Karen J. Bacon - Phone: 401-941-1500 - Website: sandlercpa.com - Signed by: Karen J. Bacon (Principal) Original filing: https://www.sec.gov/Archives/edgar/data/898635/000089863522000001/2021auditdr.pdf --- {0}------------------------------------------------ **DIVERSIFIED RESOURCES, LLC FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION FOR THE YEAR ENDED DECEMBER 31, 2021** {1}------------------------------------------------ ### **DIVERSIFIED RESOURCES, LLC FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021** #### **Contents** | Facing page | 1-3 | |---------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------| | Report of independent registered public accounting firm | 4-5 | | Financial statements | | | Statement of financial condition | 6 | | Statement of operations | 7 | | Statement of changes in member's
equity | 8 | | Statement of cash flows | 9 | | Notes to the financial statements | 10-13 | | Supplementary information | | | Schedule I -
Computation of net capital under Rule 15c3-1 of the Securities
and Exchange Commission | 14 | | Schedule II
-
Computation for determination of customer account reserve of
brokers and dealers
under Rule 15c3-3 of the Securities and Exchange
Commission | 15 | | Schedule III
-
Information relating to possession or
control requirements
under Rule 15c3-3 of the Securities and Exchange Commission | 16 | | Report of independent registered public accounting firm
on exemption report | 17 | | Exemption report
pursuant
to
Rule
17a-5
of the Securities and
Exchange Commission | 18 | {2}------------------------------------------------ #### UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 | SEC FILE NUMBER | |-----------------------------------------------------------------------------| | Expires: Oct.31, 2023
Estimated average burden
hours per response: 12 | | | | OM B APPROVAL | # ANNUAL REPORTS FORM X-17A-5 PART III 8-45497 | tnformation Required Pursuant to Rutes 17a-5, !7a-t},and 18a-7 under the Securities Exchange Act of 1934 | FACING PAGE | | | | |---------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------|---------|------------------------------------------|-----------------------------------| | FILING FOR THE PERIOD BEGINNING | LlLl202L
MM/DD/YY | | | AND ENDING L2I3LI2O2L
MM/DD/YY | | | A. REG ISTRANT I DENTIFICATION | | | | | DIVERSIFIED R FSOII RCES. LLC
NAME OF FIRM | | | | | | WPE OF REGISTRANT (check all applicable boxes): | | | | | | X Broker-dealer trsecurity-based swap dealer
tr Check here if respondent is also an OTC derivatives dealer | | | trMajor secu rity-based swap participant | | | ADDRESS OF pRlNClpAL PLACE OF BUSINESS: (Do not use a P.O. box no.) | | | | | | 70 JEFFERSON BOULEVARD | (No. and Street) | | | | | WARWICK | | RI | | 02888 | | (citY)
PERSON TO CONTACT WITH REGARD TO THIS FILING | | (State) | | (zip Code) | | KIMBERLY NEELY | 978.270-5055 | | | | | (Name) | (Email
(Area Code - Telephone | | | | | | B. ACCOU NTANT I DENTI FICATION | | | | | INDEPENDENT PUBLIC ACCOUNTANT whose reports are contained in this filing
SANDLER AND COMPANY PC | | | | | | | (Name - if individual, state last, first, a nd middle name) | | | | | 144 GOULD STREET, SUITE 204 | NEEDHAM | | MA
(State) | 02494
(Zip Code) | | (Address) | (city) | | | | | 71912009 | | | 3709
(PCAOB Registration Number, if | | | (Date of Registration with PCAOB)( f applicable) | FOR OFFICIAL USE ONLY | | | | | | | | | | persons rrdro are to lespond to the collection of information contained in this form are not required to respond unless the form displays a currently valid OMB control number. {3}------------------------------------------------ #### OATH OR AFFIRMATION #### KAREN J. BACON \_\_ swear (or affirm) that, to the best of my knowledge and belief, the financial report pertaining to the firm of DECEMBER 31 , 21 , 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. MELISSA L. CAPUANO NOTARY PUBLIC OF RHODE ISLAND My Commission Expires 4/23/2022 Notary Public #### This filing \*\* contains (check all applicable the - x (a) Statement of financial condition. - O (b) Notes to consolidated statement of financial condition. - x (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). - x (d) Statement of cash flows. - x (e) Statement of changes in stockholders' or partners' or sole proprietor's equity. - □ (f) Statement of changes in liabilities subordinated to claims of creditors. - x (g) Notes to consolidated financial statements. - x (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. - x (j) 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. - □ (l) Computation for Determination of PAB Requirements under Exhibit A to § 240.15c3-3. - x (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. - X (o) Reconciliations, including appropriate explanations, of the FOCUS Report with computation of net worth under 17 CFR 240.15c3-1, 17 CFR 240.18a-1, 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. - x (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. - x (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. - x (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. - x (w) Independent public accountant's report based on a review of the exemption report under 17 CFR 240.17a-5 or 17 Signature: Title: PRINCIPA {4}------------------------------------------------ CFR 240.18a-7, as applicable. - tr (x) Supplemental reports on applying agreed-upon procedures, in accordance with 17 CFR 240.15c3-7e or 17 CFR240.L7a-72, as applicable. - ! (y) Report describing any material inadequacies found to exist or found to have existed since the date of the previous audit, or a statement that no material inadequacies exist, under 17 CFR 2a0.77a-tZlkl. - tr (z) Other: - \*\*To request confidentiol treotment of certoin portions of this filing, see 17 CFR 240.17a-5(e)(3) or 17 CFR 240,18o-7(d)(2), as opplicable. {5}------------------------------------------------ ![](_page_5_Picture_0.jpeg) Sandler & Company, P.C. Certified Public Accountants and Advisors 144 Gould Street, Suite 204, Needham, MA 02494 | www.sandlercpa.com Tel. (781) 455-1480 Fax. (781) 455-6239 Report of Independent Registered Public Accounting Firm To the Member of Diversified Resources, LLC #### Opinion on the Financial Statements We have audited the accompanying statement of financial condition of Diversified Resources, LLC as of December 31, 2021, and the related statements of operations, changes in member's equity and cash flows for the year then ended, and the related notes (collectively referred to as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of Diversified Resources, LLC as of December 31, 2021 and the results of its 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 are the responsibility of Diversified Resources, LLC's management. Our responsibility is to express an opinion on Diversified Resources, LLC's financial statements 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 Diversified Resources, LLC 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 statements are 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 statements, 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. {6}------------------------------------------------ #### Supplementary Information The supplementary information including Schedule I, Computation of Net Capital Under Rule 15c3-1 of the Securities and Exchange Commission, Schedule II, Computation of Customer Account Reserve of Brokers and Dealers Under Rule 15c3-3 of the Securities and Exchange Commission, and Schedule III, Information Relating to Possession or Control Requirements Under Rule 15c3-3 of the Securities and Exchange Commission, have been subjected to audit procedures performed in conjunction with the audit of Diversified Resources, LLC's financial statements. The supplementary information is the responsibility of Diversified Resources, LLC's management. Our audit procedures included determining whether the supplementary 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 supplementary information. In forming our opinion on the supplementary information, we evaluated whether the supplementary including its form and content, is presented in conformity with 17 C.F.R. 240.17a-5. In our opinion the supplementary information in Schedules I, II, and III is fairly stated, in all material respects, in relation to the financial statements as a whole. We have served as Diversified Resources, LLC's auditor since 2016. Needham, Massachusetts February 25, 2022 {7}------------------------------------------------ ### **DIVERSIFIED RESOURCES, LLC STATEMENT OF FINANCIAL CONDITION DECEMBER 31, 2021** | Assets | | |----------------------------------------------------------------------|---------------| | Cash | \$
85,456 | | Accounts receivable | 440,275 | | Prepaid expenses | 20,286 | | Furniture and equipment, net of accumulated depreciation of \$52,148 | 2,359 | | Investment in mutual fund
(cost basis \$33,730) | 34,125 | | Total assets | \$
582,501 | | | | | Liabilities and Member's
Equity | | | | | | Liabilities –
Accounts and accrued expenses payable | \$
65,273 | | Member's equity | 517,228 | | Total liabilities and member's equity | \$
582,501 | {8}------------------------------------------------ ### **DIVERSIFIED RESOURCES, LLC STATEMENT OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2021** | Revenue | | |-----------------------------------------------------------|--------------| | Investment advisor fees | \$ 1,554,775 | | Mutual fund commissions | 185,003 | | Insurance and annuity commissions | 138,945 | | Gain from forgiveness of Paycheck Protection Program loan | 67,845 | | Other fees | 3,000 | | Dividends | 1,566 | | Change in unrealized gains and losses | (315) | | Total revenue | 1,950,819 | | Expenses | | | Compensation: | | | Salary | 250,339 | | Payroll taxes | 29,984 | | Group insurance | 33,985 | | Retirement plan contribution | 46,279 | | Administrative fees | 1,402 | | Total compensation | 361,989 | | Legal and Professional fees | 43,801 | | Consulting
fees | 40,000 | | Technology and communication | 53,152 | | Occupancy | 35,201 | | Office | 24,585 | | Insurance | 13,367 | | Regulatory fees | 11,614 | | Travel, meals and entertainment | 8,952 | | Local taxes | 5,994 | | Marketing and advertising | 5,833 | | Dues and subscriptions | 2,219 | | Depreciation | 996 | | Other | 659 | | Total
expenses | 608,362 | | Net
Income | \$ 1,342,457 | {9}------------------------------------------------ ## **DIVERSIFIED RESOURCES, LLC STATEMENT OF CHANGES IN MEMBER'S EQUITY FOR THE YEAR ENDED DECEMBER 31, 2021** | \$
517,228 | |---------------| | 1,342,457 | | (1,215,600) | | \$
390,371 | | | {10}------------------------------------------------ #### **DIVERSIFIED RESOURCES, LLC STATEMENT OF CASH FLOWS FOR THE YEAR ENDED DECEMBER 31, 2021** | Cash flows from operating activities: | | |--------------------------------------------------------------------------------|------------------| | Net Income | \$ 1,
342,457 | | Adjustments
to reconcile net income
to net cash provided by
operating | | | activities: | | | Depreciation | 996 | | Gain from forgiveness of Paycheck Protection Program loan | (67,845) | | Dividends automatically reinvested | (1,566) | | Change in unrealized gains and losses | 315 | | Changes in operating assets and liabilities | | | Increase
in accounts receivable | (77,472) | | Increase in prepaid expenses | (7,768) | | Increase in accounts payable | 3,561 | | Total adjustments | (149,779) | | Net cash provided
by operating activities | 1,192,678 | | Cash flows from investing activities | | | Purchase of office equipment | (1,605) | | | | | Cash flows from financing activities | | | Distributions to member | (1,215,600) | | Net decrease
in cash | (24,527) | | Cash, beginning of year | 109,983 | | Cash, end of year | \$
85,456 | #### Non-cash investing and financing activities: During the year dividend income of \$1,566 from the mutual fund investment was automatically reinvested to purchase additional shares of the mutual fund. The Payroll Protection Program loan of \$67,845 which was outstanding as of December 31, 2020 was forgiven during the year, resulting in extinguishment of the liability. {11}------------------------------------------------ ## **DIVERSIFIED RESOURCES, LLC NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021** #### **NOTE 1 – ORGANIZATION** Diversified Resources, LLC ("the Company") was organized in 2001 in the State of Rhode Island. The Company is registered with the Securities and Exchange Commission as a Registered Investment Advisor ("RIA") and also as a Broker and Dealer. The Company earns fees as an RIA for asset management services and investment advice and also earns commissions as a broker from the sale of mutual fund shares and annuity and insurance products. Client funds and investments under management by the Company are held by a third-party custodian, SEI Investments Company or one of its affiliates ("SEI"). SEI offers no-load mutual funds in various asset allocation models. The Company does not hold funds, investments or other customer accounts for its clients. Karen J. Bacon owns 100% of the Company's outstanding member interests. The Company is subject to regulation by the Securities Exchange and Commission. The Company is a member of the Financial Industry Regulatory Authority and the Securities Investor Protection Corporation. #### **NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** #### *Basis of presentation* The Company's financial statements are prepared in accordance with accounting principles generally accepted in the United States of America. #### *Accounting basis* The Company uses the accrual basis of accounting for financial statement reporting. Accordingly, revenues are recognized when services are earned and expenses are recognized when the obligation is incurred. #### *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 disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reported period. Actual results may differ from these estimates. ### *Cash* Cash is a checking account held at a bank. {12}------------------------------------------------ ### **DIVERSIFIED RESOURCES, LLC NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021** #### **NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)** #### *Property and equipment* Property and equipment are recorded at cost and depreciated using the straight-line method over the estimated useful lives of the related assets. #### *Investments* All investment securities are classified as "available for sale." Securities classified as "available for sale" are carried in the financial statements at fair value. Realized gains and losses, determined using the first-in, first-out (FIFO) cost method, or for mutual funds, the average cost basis, are included in net income. Changes in unrealized gains and losses are also included in net income. #### *Fair value measurements* Under generally accepted accounting principles, there is a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are those that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Company. Unobservable inputs reflect management's assumptions about the inputs market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The fair value hierarchy is categorized into three levels based on the inputs as follows: - Level 1. Quoted prices for identical assets or liabilities in active markets that the Company has the ability to access. - Level 2. Quoted prices in markets which are not active, quoted prices for assets or liabilities which are not identical to those being valued, inputs other than quoted prices that are observable either directly or indirectly. - Level 3. Inputs that are both unobservable and significant to the valuation. #### *Revenue recognition* #### Commissions The Company earns commissions from sales of several types of investments, including shares of mutual funds and other securities, annuities, and various insurance products. Commissions and related clearing expenses are recorded on the trade date and paid within several days of the trade. The Company believes that the performance obligation is satisfied on the trade date because that is when the underlying financial instrument and purchaser is identified, the pricing is agreed upon and the risks of ownership have been transferred to the purchaser. {13}------------------------------------------------ ### **DIVERSIFIED RESOURCES, LLC NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021** #### **NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)** The Company also earns commissions paid by mutual funds over the period of time that the Company's customers continue to hold investments in the mutual funds. The services performed for such commissions are considered to be performed over time as the Company advises its customers to continue holding investments in the mutual funds, and the revenue is therefore recognized at the time of payment. #### Investment advisory fees The Company provides investment advisory services for many of its customers on a continuing basis. The Company believes the performance obligation for providing advisory services is satisfied over time because the customer is receiving and consuming the benefits as they are provided by the Company. Fee arrangements are based on a percentage applied to the customer's assets under management. The fees are calculated and charged to the client accounts by the custodian of the client accounts at the end of each quarter, and the Company recognizes the revenue at that time. The fees are typically remitted by the custodian to the Company several days after the end of the quarter. #### *Income taxes* The Company is treated as a disregarded entity for federal and state income tax purposes. Taxable income of the Company is passed through to its sole member and is reported on her individual tax return. Accordingly, no federal or state income tax expense has been recorded in the Company's financial statements. ### **NOTE 3 – RELATED PARTY TRANSACTIONS** The Company rents its office space from its sole member on a month-to-month basis. The lease provides that the Company pays condominium fees and real estate taxes in addition to the base rent of \$2,000 per month. Rent expense including base rent and condominium fees was \$32,850 in 2021. The Company also paid \$5,994 of real estate taxes which is included in local taxes on the statement of operations. For the year ended December 31, 2021 a consulting fee in the amount of \$40,000 was paid to a relative of the Company's owner. #### **NOTE 4– RETIREMENT PLAN** The Company maintains a defined contribution and profit sharing retirement plan under Section 401(k) of the Internal Revenue Code. This plan covers all employees meeting eligibility requirements based on age and length of service and is funded by employee payroll deferrals and Company contributions. The Company made a safe harbor non-elective contribution of 3% for any eligible employee's annual compensation. In 2021, the safe harbor contribution totaled \$16,279. The amount of annual contribution for profit sharing is at the discretion of management. The Company made a profit sharing contribution of \$30,000 to the plan in 2021. {14}------------------------------------------------ ### **DIVERSIFIED RESOURCES, LLC NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021** #### **NOTE 5 – CONCENTRATION OF CREDIT RISK** Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and accounts receivable. The Company maintains its cash in a bank account, the balance of which, at times, may exceed Federal insured limits. Exposure to credit risk is reduced by placing such deposits in high quality financial institutions. A substantial portion of accounts receivable are investment advisory fees due from SEI, the custodian of investment accounts belonging to the Company's clients. Such fees are charged to the client accounts at the end of each quarter, and are typically remitted by SEI to the Company within several days. #### **NOTE 6 – FAIR VALUE MEASUREMENTS** The Company's investment in a mutual fund is carried at fair value, using the published net asset value per share of the fund as of December 31, 2021. The net asset value per share is the price at which the fund offers and redeems its shares. Fair value measurements as of December 31, 2021 are summarized as follows: | | Level 1 | Level 2 | Level 3 | Total | |---------------------------|-----------|---------|---------|-----------| | Investment in Mutual Fund | \$ 34,125 | - | - | \$ 34,125 | ### **NOTE 7 – NET CAPITAL REQUIREMENT** The Company is subject to the Securities and Exchange Commission Uniform Net Capital Rule (Rule 15c3-1), which requires maintaining a minimum net capital and requires that the ratio of aggregate indebtedness to net capital, both as defined, shall not exceed 15 to 1. The Company is required to maintain minimum net capital of \$5,000. At December 31, 2021 the Company had net capital of \$51,706 and \$46,706 of excess net capital. At December 31, 2021 the Company's aggregate indebtedness to net capital ratio was 1.26 to 1. #### **NOTE 8 – PAYROLL PROTECTION PROGRAM LOAN** In May 2020, the Company received a loan of \$67,845, which was guaranteed by the U.S. Small Business Administration under the Paycheck Protection Program (PPP). The Company utilized the entirety of the proceeds of this loan to pay expenses covered by the PPP. The full amount of the loan was forgiven in April 2021, which has been reported as gain from forgiveness of Paycheck Protection Program loan on the statement of operations #### **NOTE 9 – SUBSEQUENT EVENTS** The Company's management has evaluated all subsequent events through February. 25, 2022 the date the financial statements were available to be issued, and has determined that there are no subsequent events which occurred that require recognition or additional disclosure in these financial statements. {15}------------------------------------------------ ### **SCHEDULE I DIVERSIFIED RESOURCES, LLC COMPUTATION OF NET CAPITAL UNDER RULE 15c3-1 OF THE SECURITIES AND EXCHANGE COMMISSION AS OF DECEMBER 31, 2021** | Net capital | | | |----------------------------------------------------------------------|---------------|--| | Total member's
capital | \$
517,228 | | | Add
Allowable credits | | | | Liabilities subordinated to claims of general creditors allowable in | | | | computation of net capital | -- | | | Less Non-allowable assets | (462,451) | | | Net capital before haircuts and undue concentration on securities | | | | positions | 54,777 | | | Haircuts and undue concentration on securities positions | (3,071) | | | Net Capital | \$
51,706 | | | Aggregate indebtedness | | | | Items included in the statement of financial condition: | | | | Accrued expenses and other liabilities | \$
65,273 | | | | | | | | \$
65,273 | | | Ratio: aggregate indebtedness to net capital | 1.26
to 1 | | | Computation of basic
net capital requirement | | | | Minimum net capital required
(6 2/3% of total aggregate | | | | indebtedness) | \$
4,352 | | | Minimum dollar net capital required | \$
5,000 | | | Net capital required (greater of 6 2/3 % of total aggregate | | | | indebtedness and minimum dollar net capital required) | \$
5,000 | | | | | | | Net capital in excess of requirement | \$
46,706 | | | Net capital less greater
of 10% of aggregate indebtedness or | | | | 120% of minimum dollar net capital | \$
45,179 | | | | | | ### **Reconciliation of December 31, 2021 audited computation of net capital and Company's unaudited December 31, 2021 Part IIA of Form X-17A-5.** | Net capital
as above | \$ | 51,706 | | |------------------------------------------------------------------|----------|--------|--| | Reconciling items | | -- | | | as originally filed | \$ | 51,706 | | | Unaudited December 31, 2021
net capital per December 31, 2021 | Part IIA | | | *See report of independent registered public accounting firm.* {16}------------------------------------------------ ### **SCHEDULE II DIVERSIFIED RESOURCES, LLC COMPUTATION FOR DETERMINATION OF CUSTOMER ACCOUNT RESERVE OF BROKERS AND DEALERS UNDER RULE 15c3-3 OF THE SECURITIES AND EXCHANGE COMMISSION AS OF DECEMBER 31, 2021** The Company does not hold customers' cash or securities and, therefore, has no obligations under SEC Rule 15c3-3 concerning reserve requirements. {17}------------------------------------------------ #### **SCHEDULE III DIVERSIFIED RESOURCES, LLC INFORMATION RELATING TO POSSESSION OR CONTROL REQUIREMENTS UNDER RULE 15c3-3 OF THE SECURITIES AND EXCHANGE COMMISSION AS OF DECEMBER 31, 2021** The Company does not directly or indirectly receive, hold, or otherwise owe funds or securities for or to customers and does not carry accounts of customers. Therefore the Company has no obligations under SEC Rule 15c3-3 concerning possession or control requirements. {18}------------------------------------------------ ![](_page_18_Picture_0.jpeg) Sandler & Company, P.C. Certified Public Accountants and Advisors 144 Gould Street, Suite 204, Needham, MA 02494 www.sandlercpa.com Tel. (781) 455-1480 Fax. (781) 455-6239 # REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM ON EXEMPTION REPORT #### To the Member of Diversified Resources, LLC We have reviewed management's statements, included in the accompanying Exemption Report pursuant to Rule 17a-5 of the Securities and Exchange Commission, in which (1) Diversified Resources, LLC (the Company) is filing this Exemption Report relying on Footnote 74 of the SEC Release No. 34-70073 adopting amendments to 17 C.F.R. § 240.17a-5 because the Company limits its business activities exclusively to effecting securities transactions via subscriptions on a subscription way basis where the funds are payable to the issuer or its agent and not to the Company; selling variable life insurance or annuities; municipal securities broker (529 Plans only); and investment advisory services, and (2) the Company did not claim an exemption under paragraph (k) of 17 C.F.R. §240.15c3-3. In addition, the Company stated that it did not directly or indirectly receive, hold, or otherwise owe funds or securities for or to customers; did not carry accounts of or for customers; and did not carry PAB accounts (as defined in Rule 15c3-3) throughout the most recent fiscal year without exception. Diversified Resources, LLC's management is responsible for compliance with the exemption provisions and its statements. Our 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 Diversified Resources, LLC's compliance with the exemption provisions. A review is substantially less in scope than an examination, the objective of which is the expression of an opinion on management's statements. Accordingly, we do not express such an opinion. Based on our review, we are 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 upon the Company's business activities contemplated by Footnote 74 of the SEC Release No. 34-70073 adopting amendments to 17 C.F.R. § 240.17a-5, and related SEC Staff Frequently Asked Questions. Needham, Massachusetts February 25, 2022 {19}------------------------------------------------ #### DIVERSIFIED RESOURCES, LLC EXEMPTION REPORT PURSUANT TO SEC RULE l7a-5 OF THE SECURITIES AND BXCHANGE COMMISSION FORTHE YEARENDED DECEMBER 3r,2021 Diversified Resources LLC, (the "Company"). is a registered broker-dealer subject to Rule l7a-5 promulgated by the Securities and Exchange Commission (17 C.F.R \$240.17a5, "Reports to be made by certain brokers and dealers"). This Exemption Report was prepared as required by I 7 C.F.R \$240. I 7a-5(d)( I ) and (4). To the best of its knowledge and belief the Company states the following: - (1)The Company does not claim an exemption under paragraph (k) of 17 C.F.R \$240.15c3-3, and - (2) The Company is filing this Exemption Report relying on Footnote 74 of the SEC Release No. 34-70073 adopting amendments 17 C.F.R \$240.17a-5 because the Company limits its business activities exclusively to effecting securities transactions via subscriptions on a subscription way basis where the funds are payable to the issuer or its agent and not to the Company; selling variable life insurance or annuities; municipal securities broker (529 Plans only); and investment advisory services. The Company does not claim an exemption under paragraph (k) of 17 C.F.R \$240.15c3-3, and - (3)The Company did not directly or indirectly receive, hold, or otherwise owe funds or securities for or to customers; did not carry accounts of or for customers; and did not carry PAB accounts (as defined in Rule l5c3-3) throughout the most recent fiscal year without exception. I, Karen J. Bacon, swear (or affirm) that, to my best knowledge and belief, this Exemption Report is true and correct. By: t 01, Karen J. Bacon President, Diversified LLC Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.