# GATEWAY FINANCIAL AGENCY CORPORATION X-17A-5 (2021-03-19) — Broker-dealer annual report - Company: GATEWAY FINANCIAL AGENCY CORPORATION - Form: X-17A-5 - Filed: 2021-03-19 - Period: 2020-12-31 - Accession: 0000920073-21-000002 - CIK: 920073 - File #: 8-46992 - Material weakness: No - Auditor: Ohab and Company, P.A. - Auditor location: Maitland, FL - Contact: Susan Neculae - Phone: 8639932682 - Email: pam@ohabco.com - Website: ohabco.com - Signed by: Susan Neculae (Treasurer) Original filing: https://www.sec.gov/Archives/edgar/data/920073/000092007321000002/gfac.audit.stmt-2020.pdf.pdf --- {0}------------------------------------------------ **UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549** **OMB APPROVAL OMB Number: 3235-0123 Expires: October 31,2023 Estimated average burden hours per response 12.00** # **ANNUAL AUDITED REPORT FORM X-17A-5 PART III** | | S E C FILE NUMBER | |----|-------------------| | 8- | | **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 | Of | MM/DD/YY | AND ENDING | /<2/3//2 OSLO
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IDENTIFICATIO N | | | | | | | | NAME OF BROKER-DEALER: GftTEWM fl^d&QL | | AG>hJdi CodPoQ^iO/J | | OFFICIAL USE ONLY | | | | ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use P.O. Box No.) | | | | FIRM I.D. NO. | | | | /576/V
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P.A. | | | | | | | | | | (Name — if individual, state last, first, middle name) | | | | | | | | | | | | | | (Address) | (City) | | (State) | (Zip Code) | | | | CHECK ONE:
Certified Public Accountant
Public Accountant
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 offacts and circumstances relied on as the basis for the exemption. See Section 240.17a-5 (e)(2)* > **Potential persons who are to respond to the collection of information contained in this form are not required to respond unless the form displays a currently valid OMB control number.** **SEC 1410 (11-05)** {1}------------------------------------------------ #### **OATH OR AFFIRMATION** | I,
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, swear (or affirm) that, to the best of | | | |--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------|--|--| | my knowledge and belief the accompanying financial statement and supporting schedules pertaining to the firm of | | | | | GATLWAV
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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: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Signature | | | | | | | | | | | | | | | Title | | | | | Angelica Orozco | | | | | Notary Public | | | | | State of Florida | | | | This report * * contains (check all applicable boxes): | My Commission Expires 10/26/2024 | | | | (a) Facing Page. | Commission No. HH 57403 | | | | (b) Statement of Financial Condition. | | | | | of Comprehensive Income (as defined in §210.1-02 of Regulation S-X). | (c) Statement of Income (Loss) or, if there is other comprehensive income in the period(s) presented, a Statement | | | | (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. | | | | | (j) | A Reconciliation, including appropriate explanation of the Computation of Net Capital Under Rule 15c3-1 and the | | | | Computation for Determination of the Reserve Requirements Under Exhibit A of Rule 15c3-3. | | | | | consolidation. | (k) A Reconciliation between the audited and unaudited Statements of Financial Condition with respect to methods of | | | | (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 conditions of confidential treatment of certain portions of this filing, see section | 240.17a-5(e)(3). | | | {2}------------------------------------------------ # **GATEWAY FINANCIAL AGENCY CORPORATION** **FINANCIAL STATEMENTS DECEMBE R 312020** {3}------------------------------------------------ # **Gateway Financial Agency Corporation Member FINRA** **Rule 15c3-3 Exemption Report for the Year Ended December 31, 2020** **To the best of my knowledge and belief Gateway Financial Agency Corporation, Broker/Dealer;** - **1. Operated under the (k)(l) exemption during the previous calendar year** - **2. Met the provisions of the exemption throughout the calendar year by limiting it's business actities to the sale of securities of Registered Investment Companies (Mutual Funds) without exception.** **Susan Neculae** **Date:** *JJJA/Ufifc^* **V,** *2\*\*'* **15c3-3 Exemption** **1576 NW Pine Creek Avenue Arcadia, F L 34266 Phone 863-993-2682 FAX 863-993-2682** {4}------------------------------------------------ ![](_page_4_Picture_0.jpeg) **100 E. Sybelia Ave. Suite 130 Mattland, FL 32751** *Certified Public Accountants* **Email: pam@ohabco.com** **Telephone 407-740-7311 Fax 407-740-6441** ### REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors and Members of Gateway Financial Agency Corporation We have reviewed management's statements, Included in the accompanying Exemption Report, in which (1) Gateway Financial Agency Corporation identified the following provisions of 17 C.F.R. §15c3-3(k) under which Gateway Financial Agency Corporation claimed an exemption from 17 C.F.R. §240.15c3-3: (1) (exemption provisions) and (2) Gateway Financial Agency Corporation stated that Gateway Financial Agency Corporation met the identified exemption provisions throughout the most recent fiscal year without exception. Gateway Financial Agency Corporation'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 Gateway Financial Agency Corporation'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 on the provisions set forth in paragraph (k)(1) of Rule 15c3-3 under the Securities Exchange Act of 1934. Maitland, Florida March 15, 2021 {5}------------------------------------------------ ![](_page_5_Picture_0.jpeg) **100 E. Sybetia Ave. Suite 130 Mattland, FL 32751** *Certified Public Accountants* **Email: pamttohabco.com** **Telephone 407-740-7311 Fax 407-740-6441** #### REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors and Stockholder's of Gateway Financial Agency Corporation ### **Opinion on the Financial Statements** We have audited the accompanying statement of financial condition of Gateway Financial Agency Corporation as of December 31, 2020, the related statements of income and retained earnings, changes in stockholder's equity, and cash flows for the year then ended, and the related notes and schedules (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of Gateway Financial Agency Corporation as of December 31,2020, 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 Gateway Financial Agency Corporation's management. Our responsibility is to express an opinion on Gateway Financial Agency Corporation'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 Gateway Financial Agency Corporation 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. ### **Auditor's Report on Supplemental Information** The Schedule I has been subjected to audit procedures performed in conjunction with the audit of Gateway Financial Agency Corporation's financial statements. The supplemental information is the responsibility of Gateway Financial Agency Corporation's management. Our 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 information. In forming our opinion on the supplemental information, we evaluated whether the supplemental information, including its form and content, is presented in conformity with 17 C.F.R. §240.17a-5. In our opinion, Hie Schedule i is fairly stated, in all material respects, in relation to the financial statements as a whole. We have served as Gateway Financial Agency Corporation's auditor since 2020. Maitiand, Florida March 15,2021 {6}------------------------------------------------ # **GATEWAY FINANCIAL AGENCY CORPORATION BALANCE SHEET DECEMBER 31, 2020** ### **ASSETS** | Current Assets
Cash
Commission Receivable | \$
26,570
4,518 | |-------------------------------------------------|-----------------------| | Prepaid Expenses | 1,632 | | Total Assets | \$
32,720 | # **LIABILITIES AND STOCKHOLDER'S EQUITY** | Current Liabilities | | |-------------------------------------------------------------------------------|--------------| | Accounts Payable | \$
275 | | Commission Payable | 3,614 | | Professional Fees Payable | 4,500 | | ITNRA Assessment Payable | 1,000 | | Total Liabilities | 9,389 | | Stockholder's Equity | | | Common Stock, 1500 Shares Authorized, 200 Shares Outstanding,
No Par Value | \$
7,282 | | | | | Additional Paid-in Capital | 2,809 | | Retained Earnings | 13,240 | | Total Stockholder's Equity | 23,331 | | Total Liabilitites & Stockholders's Equity | \$
32,720 | {7}------------------------------------------------ # **GATEWAY FINANCIAL AGENCY CORPORATION STATEMENT OF INCOME AND RETAINED EARNINGS FOR THE YEA R ENDED DECEMBER 31, 2020** | Revenue | | | |------------------------------------------|--|----------| | Commissions From Mutual Fund Sales
\$ | | 44,874 | | Distribution Fees | | 35,365 | | Total Revenue | | "80\239" | | | | | | Agent's Commission Expense | | 63,465 | | Gross Profit | | 16,774 | | Operating Expenses | | | | Office Expense | | 3,224 | | Licenses and Fees | | 2,935 | | Taxes | | 385 | | Professional Fees | | 6,600 | | Total Operating Expenses | | 13,144 | | Profit From Operations | | 3,630 | | Retained Earnings | | | | | | | | Balance, January 1 2020 | | 9,610 | **Balance, December 31,2020 \$ 13,240** {8}------------------------------------------------ # **GATEWA Y FINANCIAL AGENC Y CORPORATIO N STATEMENT OF CASH FLOWS - INDIRECT METHOD FOR THE YEAR ENDED DECEMBER 31, 2020** | Operations: | | |-----------------------------------------------------------------|------------------------| | Net Income
Adjustments:
Increase in Commission Receivable | \$
3,630
(4,518) | | Increase in Accounts Payable
Cash Provided by Operations | 8,014
7,126 | | Cash at January 1, 2020 | 19,444 | | Cash at December 31, 2020 | \$
26,570 | {9}------------------------------------------------ # **GATEWA Y FINANCIAL AGENC Y CORPORATIO N STATEMENT OF CHANGES IN STOCKHOLDER' S EQUITY DECEMBER 31, 2020** | | Common
Stock | Additional
Paid - In
Capital | Retained
Earnings | Total
Stockholder's
Equity | |----------------------------|-----------------|------------------------------------|----------------------|----------------------------------| | Balance, December 31, 2019 | \$
7,282 | \$
2,809 | \$
9,610 | \$
19,701 | | Net Income | 0_ | 0_ | 3,630 | 3,630 | | Balance, December 31, 2020 | \$
7,282 | \$
2,809 | \$
13,240 | \$
23,331 | {10}------------------------------------------------ # **GATEWAY FINANCIAL AGENCY CORPORATION NOTES TO THE FINANCIAL STATEMENTS DECEMBER 31, 2020** ### **Note 1** - Nature of Business and Summary **of** Significant Accounting Policies #### **Nature of Business** **Gateway Financial Agency Corporation (the "Company") operates a Securities Broker/Dealer. The Company earns commissions from the sale of mutual funds, variable annuities and variable life insurance.** ### **Cash and Cash Equivalents** **For purposes of reporting the statement of cash flows, the Company considers all cash accounts, which are not subject to withdrawl restrictions or penalties, and all highly liquid debt uistruments purchased with a maturity of three months or less to be cash equivalents. Cash balances in excess of FDIC and similar insurance coverage are subject to the usual banking risks associated with funds in excess of those limits. At December 31, 2020. the Company had no uninsured cash balances.** ### **Income Taxes** **The Company has elected to be treated as an "S" Corporation whereby the individual stockholders are taxed on their share of the Company's taxable income. Therefore, no provisions for income taxes or credits are included on these financial statements. Tax returns for the period 2017 - 2020 are open to examination by the Internal Revenue Service.** ## **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 amounts of revenues and expenses during the reporting period. Actual results could differ from those amounts.** ## **Note 2 - Net Capital Requirement** **As of December 31, 2020, the total net capital of the Company is twenty-one thousand six hundred ninety-nine dollars (\$21,699) which is sixteen thousand six hundred ninety-nine dollars (\$16,699) in excess of it's net capital requirement of five thousand dollars (\$5000).** {11}------------------------------------------------ # **GATEWAY FINANCIAL AGENCY CORPORATION NOTES TO THE FINANCIAL STATEMENTS DECEMBER 31, 2020** **(Continued)** #### **Note 3 - Revenue Recognition** **Revenue is recognized in accordance with FASB ASC Tonic 606 as services are rendered and the contracts identified performance obligations have been satisfied. Commissions and fees received from the sale of mutual funds and variable annuities are recognized at the time the associated service is fulfilled, including the investment company receiving the application which is based on the trade date.** ## **Distribution Fees** **The Company only enters into arrangements with Mutual Fund companies. The Company may receive distribution fees paid by the funds up front, over time or upon the investor's exit from the fund, known as contingent deferred sales charge.** **The Company believes that it's performance obligation is the sale of mutual fund shares and as such this is fulfilled on the tirade date. Consequently, reversal of revenue is not possible.** # **Note 4 - Additional Requirements** **The Company submitted a Computation of Net Capital, a Computation of Aggregate Indebtedness and the Percentage of Aggregate Indebtedness to Net Capital with the December 31, 2020 FOCUvS Report Part IIA, There is no material difference between the audited computation and the un audited computation filed on Part HA.** **The Company operates under Limited Business exemption (k) (1) from SEC Rule 15c3-3.** # **Note 5 - Related Party Transactions** **The owners of the Company provide it office space, equipment, supplies and services necessary to conduct business operations for a monthly fee.** **Included in the Financial Statements are the following amounts that have been paid to related parties.** | Agents Compensation Expense Paid to Owner | \$
63,466. | |--------------------------------------------|---------------| | Office Expense Reimbursement Paid to Owner | 3,200. | {12}------------------------------------------------ # **GATEWAY FINANCIAL AGENCY CORPORATION NOTES TO THE FINANCIAL STATEMENTS DECEMBER 31, 2020** **(Continued)** # **Note** 6 **- Subordinated Liabilities** The Company has no liabilities subordinated to general creditors during the current or prior years. # **Note 7 - Contingencies** The Company is unaware of any commitments or contingencies. The Company is not currently involved in any legal actions and currently has no attorney retained. # **Note 8 - Subsequent** Events Management has evaluated subsequent events through the date on which the financial statements were available to be issued. The Company determined it has no events or transactions occurring that require disclosure. {13}------------------------------------------------ # **GATEWAY FINANCIAL AGENCY CORPORATION SCHEDULE** 1 **- COMPUTATION OF NET CAPITAL UNDER RULE 15C3-1 DECEMBER 31, 2020** | Computation of Net Capital | | | |--------------------------------------------------------------------------------------------------------------------------------------|----------|-----------------| | Total Ownership Equity from statement of financial condition | \$ | 23,331 | | Less | | | | Non-allowable assets: | | | | | | | | Prepaid expenses | | (1,632) | | Net Capital | | \$ ~21,699 | | Computation of Basic Net Capital Requirement
Minimum net capital required \$5,000
Net capital in excess of minimum requirement | \$
\$ | 5,000
16,699 | | Aggregate Indebtedness | \$ | 9,389 | | Ratio of aggregate indebtedness to net capital | | 43.27 % | **There are no material differences between the above computation and the computation included in the Company's corresponding unaudited Form X-17A-5 Pail HA filing as of December 31,** 2020 Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.