# GVC CAPITAL LLC X-17A-5 (2023-03-01) — Broker-dealer annual report - Company: GVC CAPITAL LLC - Form: X-17A-5 - Filed: 2023-03-01 - Period: 2022-12-31 - Accession: 0000948395-23-000001 - CIK: 948395 - File #: 8-48465 - Type: Broker-dealer - Material weakness: No - Auditor: Spicer Jeffries LLP - Auditor location: Denver, CO - Contact: Andrea Kidd - Phone: 7204884728 - Email: akidd@gvccap.com - Website: gvccap.com - Signed by: Andrea Kidd (CFO) Original filing: https://www.sec.gov/Archives/edgar/data/948395/000094839523000001/gvcfull2022auditreport.pdf --- {0}------------------------------------------------ #### **REPORT PURSUANT TO RULE 17a-5(d)** **YEAR ENDED DECEMBER 31, 2022** The report is deemed **CONFIDENTIAL** in accordance with Rule 17a-5( e)(3) under the Securities Exchange Act of 1934. A statement of financial condition, has been filed with the Securities and Exchange Commission simultaneously herewith as a **PUBLIC DOCUMENT.** {1}------------------------------------------------ **UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549** 0MB APPROVAL 0MB Number: 3235-0123 Expires: Oct. 31, 2023 Estimated average burden hours per response: 12 # **ANNUAL REPORTS FORM X-17A-5 PART** Ill SEC FILE NUMBER **FACING PAGE Information Required Pursuant to Rules 17a-5, 17a-12, and 18a-7 under the Securities Exchange Act of 1934** FILING FOR THE PERIOD BEGINNING **01 /01 /22** MM/DD/YY AND ENDING **12/31/22** MM/DD/YY **A. REGISTRANT IDENTIFICATION** NAME oF FIRM: GVC Capital LLC TYPE OF REGISTRANT (check all applicable boxes): 0 Broker-dealer □ Security-based swap dealer D Check here if respondent is also an OTC derivatives dealer □ Major security-based swap participant ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use a P.O. box no.) 5350 S. Roslyn St. Suite 300 (No. and Street) Greenwood Village co 80111 (City) (State) (Zip Code) PERSON TO CONTACT WITH REGARD TO THIS F!LING Andrea Kidd 720-488-4 728 akidd@gvccap.com (Name) (Area Code -Telephone Number) (Email Address) **B. ACCOUNTANT IDENTIFICATION** INDEPENDENT PUBLIC ACCOUNTANT whose reports are contained in this filing\* Spicer Jeffries, LLP (Name - if Individual, state last, first, and middle name) 4601 DTC Boulevard, Suite 700 Denver co 80237 (Address) (City) (State) (Zip Code) 10/20/2003 349 rte of Reglstcatloa 0,th PCAOBJ(• appl•able) FOR OFFICIAL **USE ONLY** (PCMB Reglst,atloa N"mbe,, • appllcab~) I \* Claims for exemption from the requirement that the annual reports be covered by the 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 CFR 240.17a-S(e)(l)(ii), if applicable. 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 0MB control number. {2}------------------------------------------------ #### **OATH OR AFFIRMATION** | | swear (or affirm) that, to the best of my knowledge and belief, the
I, Andrea Kidd | |--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------| | | 2~
financial report pertaining to the firm of GVC Capital LLC
as of | | | 12/31
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. | | | KATHERINE L WALKER | | | Signature:
NOTARY PUBLIC | | | STArE OF COLORADO
NOTARY ID 200040226 7 | | | Title:
CFO, Co-CCO | | | | | | | | | | | | | | | This filing"'* contains (check all applicable boxes): | | iii | (a) Statement of financial condition. | | | iii (b) Notes to consolidated statement of financial condition. | | iii | (c) Statement of income (loss) or, ifthere is other comprehensive income in the period(s) presented, a statement of
comprehensive income (as defined in§ 210.1-02 of Regulation S-X). | | | (d) Statement of cash flows. | | ii!iii | | | ii!iii | (e) Statement of changes in stockholders' or partners' or sole proprietor's equity.
D (f) Statement of changes in liabilities subordinated to claims of creditors. | | | (g) Notes to consolidated financial statements. | | ii!iii | (h) Computation of net capital under 17 CFR 240.15c3-1 or 17 CFR 240.18a-1, as applicable. | | ii!iii | D (i) Computation of tangible net worth under 17 CFR 240.18a-2. | | | D (j) Computation for determination of customer reserve requirements pursuant to Exhibit A to 17 CFR 240.15c3-3. | | D | (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. | | D | (I) Computation for Determination of PAB Requirements under Exhibit A to § 240.15c3-3. | | | D (m) Information relating to possession or control requirements for customers under 17 CFR 240.15c3-3. | | | D (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. | | ii!iii | (o) Reconciliations, including appropriate explanations, of the FOCUS Report with computation of net capital or tangible 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. | | | D (p) Summary of financial data for subsidiaries not consolidated in the statement of financial condition. | | ii!iii | (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. | | | D (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. | | iii | (t) Independent public accountant's report based on an examination of the statement offinancial condition. | | | iii (u) Independent public accountant's report based on an examination of the financial report or financial statements under 17 | | | CFR 240.17a-5, 17 CFR 240.18a-7, or 17 CFR 240.17a-12, as applicable. | | | D (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. | | ii!iii | (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. | | | D (x) Supplemental reports on applying agreed-upon procedures, in accordance with 17 CFR 240.15c3-1e or 17 CFR 240.17a-12, | | | 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 240.17a-12(k).
___________________________________
□ (z) Other:
_ | | | | \*\*To request confidential treatment of certain portions of this filing, see 17 CFR 240.17a-5(e)(3) or 17 CFR 240.18a-7(d)(2), as applicable. {3}------------------------------------------------ #### **CONTENTS** | | Page(s) | |---------------------------------------------------------------------------------------------------|---------| | Report of Independent Registered Public Accounting Firm | 3-4 | | Statement of Financial Condition | 5 | | Statement of Operations | 6 | | Statement of Changes in Member's Equity | 7 | | Statement of Cash Flows | 8 | | Notes to Financial Statements | 9-15 | | Supplementary Schedule:
Computation of Net Capital Pursuant to Uniform Net Capital Rule 15c3-1 | 16 | | | | Report of Independent Registered Public Accounting Firm on the Company's Exemption Report including Management's Statement 17- 18 {4}------------------------------------------------ ![](_page_4_Picture_0.jpeg) Certified Public Accountants 4601 DTC BOULEVARD, SUITE 700 DENVER, COLORADO 80237 TELEPHONE: (303) 753:1959 FAX: (303) 753-0338 www.spice1jeffHes.com ### **REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM** To the Member of GVC Capital LLC #### **Opinion on the Financial Statements** We have audited the accompanying statement of financial condition of GVC Capital LLC (the "Company") as of December 31, 2022, the related statements of operations, changes in member'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 the Company as of December 31, 2022, 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 the Company's management. Our responsibility is to express an opinion on the Company'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 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 ouraudit 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. ![](_page_4_Picture_10.jpeg) {5}------------------------------------------------ #### **Supplemental Information** The Computation of Net Capital Pursuant to Uniform Net Capital Rule l 5c3-l has been subjected to audit procedures performed in conjunction with the audit of the Company's financial statements. The supplemental information is the responsibility of the Company'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. l 7a-5. In our opinion, the Computation of Net Capital Pursuant to Uniform Net Capital Rule l 5c3 l is fairly stated, in all material respects, in relation to the financial statements as a whole. **~lLf** We have served as GVC Capital LLC's auditor since 1995. Denver, Colorado February 27, 2023 {6}------------------------------------------------ #### **STATEMENT OF FINANCIAL CONDITION DECEMBER 31, 2022** #### **ASSETS** | Cash and cash equivalents | \$ | 143,257 | |----------------------------------------------------------------|----|---------| | Deposit held at clearing broker | | 126,997 | | Receivables | | | | Commissions | | 51,156 | | Other Receivables | | 360 | | Right ofUse Asset | | 157,979 | | Office equipment and leasehold nnprovements, at cost, | | | | net of accumulated depreciation and ammtization of \$73,998.85 | | 955 | | Other assets | | 4,279 | | Long-term investments, at fuir value (Note 5) | | 635 | | | \$ | 485,619 | | LIABILITIES AND MEMBER'S EQUITY | | | | LIABILITIES: | | | | Accounts payable and accrued expenses | \$ | 186,300 | | Lease Liability | | 171,214 | | Total Liabilities | \$ | 357,514 | | COMMITMENTS AND CONTINGENCIES (Note 3 and 4) | | | | MEMBER'S EQUITY (Note 2) | | 128,104 | | | \$ | 485,619 | {7}------------------------------------------------ #### **STATEMENT OF OPERATIONS YEAR ENDED DECEMBER 31, 2022** | REVENUE: | | |-------------------------------------|-----------| | Connrussions | \$507,716 | | Investment banking | 387,129 | | Other income | 206,924 | | Trading gains, net | 4,744 | | Total revenue | 1,106,513 | | EXPENSES: | | | Salaries, conmlissions and benefits | 555,732 | | Occupancy costs | 90,107 | | Clearing charges | 133,465 | | General and administrative | 203,619 | | Professional fees | 19,037 | | Travel and entertairunent | 28,117 | | Commmrications | 13,798 | | Total expenses | 1,043,875 | | NET GAIN | \$62,638 | {8}------------------------------------------------ #### **STATEMENT OF CHANGES IN MEMBER'S EQUITY YEAR ENDED DECEMBER 31, 2022** | BALANCE, December 31, 2021 | \$
65,466 | |----------------------------|---------------| | Distributions | | | Contributions | | | Net Gain | 62,638 | | BALANCE, December 31, 2022 | \$
128,104 | {9}------------------------------------------------ #### **STATEMENT OF CASH FLOWS YEAR ENDED DECEMBER 31, 2022** ## **CASH FLOWS TO OPERATING ACTIVITIES:** | Net Gain | \$
62,638 | |-------------------------------------------------------|---------------| | Adjustments to reconcile net gain to net cash used in | | | operating activities: | | | Depreciation and ammiization | 292 | | Increase ill deposit held at clearing broker | (317) | | Decrease in commissions receivable | 13,649 | | Decrease in other receivables | 855 | | Decrease in securities owned | | | Decrease in other assets | 0 | | Increase ill accounts payable and accrued expenses | (15,445) | | Net cash used in operriting activities | 61,672 | | CASH FLOWS FROM INVESTING ACTIVITIES: | | | Increase ill long-term investments | 0 | | Net cash used by investing activities | 0 | | CASH FLOWS TO/FROM FINANCING ACTIVITIES: | | | Contributions | | | Distributions | | | Net Casi, used in Financing Activities | | | NET DECREASE IN CASH AND CASH EQUIVALENTS | 61,672 | | CASH AND CASH EQUIVALENTS, beginning of year | 81,585 | | CASH AND CASH EQUIVALENTS, end of year | \$
143,257 | The accompanying notes are an integral part of this statement. {10}------------------------------------------------ ## **NOTES TO FINANCIAL STATEMENTS** ## *NOTEl- ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES* ## *Organization and Business* Bathgate Capital Partners LLC was organized in 1995. Bathgate Capital Partners LLC changed its name to GVC Capital LLC (the "Company") effective January 1, 2010 and is a securities broker-dealer registered with the Securities and Exchange Commission and is a member of the Financial Industry Regulatory Agency, Inc. The Company is a wholly-owned subsidiary of GVC Partners LLC ("Parent"). ## *Cleal'ing Agreement* The Company, under Rule 15c3-3(k)(2)(ii), is exempt from the reserve and possession or control requirements of Rule 15c3-3 of the Securities and Exchange Commission. The Company does not carry or clear customer accounts. Accordingly, all customer transactions are executed and cleared on behalf of the Company by its clearing broker on a fully disclosed basis. The Company's agreement with its clearing broker provides that as clearing broker, that finn will make and keep such records of the transactions effected and cleared in the customer accounts as are customarily made and kept by a clearing broker pursuant to the requirements of Rules l 7a-3 and 17a-4 of the Securities and Exchange Act of 1934, as amended (the "Act"). It also perfonns all services customarily incident thereon, including the preparation and distribution of customer's confirmations and statements and maintenance margin requirements under the Act and the rules of the Self Regulatory Organizations of which the Company is a member. #### *Revenue Recognition* The Company records proprietary transactions, comm1ss10n revenue and related expenses on a settlement date basis. Transactions recorded on a trade date basis would not be materially different. In connection with the Company's investment banking activities, underwriting deposits and expense advances received by the Company, along with any related expenses, are deferred and recognized when its services are completed. Consulting fees are recognized when earned in accordance with applicable consulting agreement. ### *F{lir Value of Financi{l/ Instruments* The Company's financial instruments, including cash and cash equivalents, deposit held at clearing broker, commissions receivable, and accounts payable and accmed expenses are carried at amounts that approximate fair value due to the short-term nature of the instruments. #### *Securities lnventorv and Long-term Investments* The Company values its investments in accordance with Accmmting Standards Codification 820 - Fair Value Measurements ("ASC 820"). Under ASC 820, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e., the "exit price") in an orderly transaction between market participants at the measurement date. {11}------------------------------------------------ #### **NOTES TO FINANCIAL STATEMENTS** *(continued)* #### *NOTE 1- ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)* #### *Securities Inventory and Long-term Investments (continued)* In determining fair value, the Company uses various valuation approaches. ASC 820 establishes a fair value 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 the Company's assumption 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 - Valuations based on tmadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access. Valuation adjustments and blockage discounts are not applied to Level 1 securities. Since valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these securities does not entail a significant degree of judgment. Level 2 - Valuations based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly. Level 3 - Valuations based on inputs that are unobservable and significant to the overall fair value measurement. The availability of valuation techniques and observable inputs can vary from security to security and is affected by a wide variety of factors, including the type of security, whether the security is new and not yet established in the marketplace, and other characteristics particular to the transaction. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Those estimated values do not necessarily represent the amounts that may be ultimately realized due to the occunence of future circumstances that cannot be reasonably determined. Because of the inherent uncertainty of valuation, those estimated values may be materially higher or lower than the values that would have been used had a ready market for the securities existed. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for securities categorized in Level 3. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement falls in its entirety is determined by the lowest level input that is significant to the fair value measurement. Fair value is a market-based measure considered from the perspective of a market participant rather than an entity-specific measure. Therefore, even when market assumptions are not readily available, the Company's own assumptions are set to reflect those that market participants would use in pricing the asset or liability at the measurement date. {12}------------------------------------------------ ## NOTES TO FINANCIAL STATEMENTS *(continued)* #### *NOTEl-ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)* #### *Securities Inventory and Long-term Investments (concluded)* The Company uses prices and inputs that are current as of the measurement date, including during periods of market dislocation. In periods of market dislocation, the observability of prices and inputs may be reduced for many securities. This condition could cause a security to be reclassified to a lower level within the fair value hierarchy. The Company values its securities and securities sold, not yet purchased, that are freely tradable and are listed on a national securities exchange or reported on the NASDAQ national market at their last sales price as of the last business day of the year. Changes in fair value are reflected in the Company's statement of operations. The Company's long-term investments consist of investments in private companies consisting of direct equity investments. The transaction price, including transaction costs, is typically the Company's best estimate of fair value at inception. When evidence supports a change to the carrying value from the transaction price, adjustments are made to reflect expected exit values. Ongoing reviews by the Company's management are based on an assessment of each underlying investment, incorporating valuations that consider evaluation of financing and sale transactions with third parties as well as comparable transactions. These nonpublic securities are considered to be Level 3 of the fair value hierarchy. #### *Cash Equivalents* For purposes of the statement of cash flows, the Company considers all highly liquid instruments purchased with an original maturity of three months or less to be cash equivalents. #### *Income Taxes* The Company is a single member limited liability company ("LLC") and is a disregarded entity for federal and state income tax purposes. Accordingly, no provision for income taxes has been provided for in the accompanying financial statements. The Company's Parent is also an LLC and therefore, all income and expense is reported by the members of the Parent. The Company is required to determine whether a tax position is more likely than not to be sustained upon examination by the applicable taxing authority, including resolution of any tax related appeals or litigation processes, based on the technical merits of the position. The Company files an income tax return in the U.S. federal jurisdiction and may file income tax returns in various U.S. states. The Company is not subject to income tax return examinations by major taxing authorities for years before 2017. The tax benefit recognized is measured as the largest amount of benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. De-recognition of a tax benefit previously recognized results in the Company recording a tax liability that reduces net assets. {13}------------------------------------------------ ## **NOTES TO FINANCIAL STATEMENTS** *(continued)* #### *NOTE 1- ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (concluded)* ## *Income Taxes (concluded)* However, the Company's conclusions regarding this policy may be subject to review and adjustment at a later date based on factors including, but not limited to, on-going analyses of and changes to tax laws, regulations and interpretations thereof. The Company recognizes interest accrued related to unrecognized tax benefits and penalties related to unrecognized tax benefits in income taxes payable, if assessed. No interest expense or penalties have been recognized as of and for the year ended December 31, 2022. ## *Use of Estimates* The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America 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 estimates. # *NOTE2- NET CAPITAL REQUIREMENTS* Pursuant to the net capital provisions of Rule 15c3-1 of the Securities Exchange Act of 1934, the Company is required to maintain a minimum net capital, as defined under such provisions. At December 31, 2022, the Company had net capital and net capital requirements of \$118, 125 and \$13,302, respectively. The Company's net capital ratio (aggregate indebtedness to net capital) was 1.69 to 1. According to Rule 15c3-l, the Company's net capital ratio shall not exceed 15 to 1. ### *NOTE3- COMA-1/ITMENTS AND RELATED PARTY TRANSACTIONS* The Company has equipment from unrelated parties under non-cancelable operating leases. The leases have remaining terms of less than three years, and do not contain options to either extend or terminate the leases. {14}------------------------------------------------ ## **NOTES TO FINANCIAL STATEMENTS** #### *NOTE3- COMMITMENTS AND RELATED PARTY TRANSACTIONS (continued)* Operating Leases: | Right-
of-
use assets | 250,546 | |-----------------------------|---------| | Accumulated Amortization | 92,567 | | Right-of-use assets, net | 157,979 | | Operating Lease Liability | 171,214 | Maturities of lease liabilities at December 31, 2022 were as follows: | | Year | Almunt | |-----------------------|------|---------| | | 2023 | 88,275 | | | 2024 | 89,062 | | | | | | Total Lease Payment | | 176,337 | | Less imputed interest | | (5,123) | | | | 171,214 | The Company has evaluated F ASB Accounting Standards Update 2016-02, Leases (Topic 842) effective for fiscal years beginning after December 15, 2019 and has updated its recognition of the corresponding lease assets and liabilities. Implementation of the new standard does not materially affect the Company's operations or net capital computations. Total rental expense, including the leases referred to above, was \$90,107 for the year ended December 31,2022. The Company entered into a settlement agreement in 2021 which obligates the Company to pay the party 50% of the Company's net profits for years 2022, 2023, and 2024, 2025, and 2026, up to \$100,000. If the Company is not profitable, no money is owed. On November 25, 2021, GVC received two fraudulent wire requests for two brokerage clients. These were processed, resulting in a loss of\$139,000. GVC used its own capital to replace the money in its clients' accotmts. GVC's auditors required the firm to recognize the \$139,000 loss in 2021, since it was not guaranteed the funds would be recovered. GVC worked with its clearing firm and the banks involved to recover this money. In March of 2022, GVC filed a claim against its Fidelity Bond to receive insurance money for the loss. The claim was approved and GVC received \$120,000 on May 9, 2022. {15}------------------------------------------------ ## **NOTES TO FINANCIAL STATEMENTS** ## *NOTE3- COMMITMENTS AND RELATED PARTY TRANSACTIONS (concluded)* On May 31, 2022, GVC was finally successful in recovering most of the loss. GVC received \$129,440.66. GVC then repaid the insurance company a total of \$115,440.66. Because GVC took the loss in 2021, the \$129,440.66 was brought in as new revenue, even though it was capital lost from 2021. Without the recovery of these funds, GVC would have had an operating loss for 2022. | Wire money recovered:
Net Received from | 129,440.66 | |----------------------------------------------|--------------------------| | Insurance: | 4559.34 | | Accrued against money | (50,000.00) | | Netto GVC | 84,000.00 | | Net Income for 2022
Without wire recovery | 62,638.02
(84,000.00) | | Net loss | (21,361.98) | #### *NOTE4- FINANCIAL INSTRUMENTS, OFF-BALANCE SHEET RISKS AND CONTINGENCIES* In the normal course of business, the Company's customers' activities ("customers") through its clearing broker involve the execution, settlement, and financing of various customer securities transactions. These activities may expose the Company to off-balance sheet risk. In the event the customers fail to satisfy their obligations, the Company may be required to purchase or sell financial instruments at prevailing market prices in order to fulfill the customers' obligations. The Company is involved in various disputes arising in the normal course of business, some of which are indeterminable. Management, after review and discussion with legal counsel, believes the Company has meritorious defense and intends to vigorously defend itself in these various matters, but it is not feasible to predict the final outcome at the present time. The Company is engaged in various trading 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 with which it conducts business. The Company bears the risk of financial failure by its clearing broker. If the clearing broker should cease doing business, the amounts due from this clearing broker could be subject to forfeiture. {16}------------------------------------------------ ## **NOTES TO FINANCIAL STATEMENTS** ### *NOTES- FAIR VALUE MEASUREMENTS* The following table presents information about the Company's assets measured at fair value as of December 31, 2022: | | Quoted Prices in
Active Markets
for ldentical Assets
(Level 1) | Significant
Other Observable
Inputs
(Level 2) | Significant
Unobservable
Inputs
(Level 3) | Balances as of
December 31, 2022 | | | |-----------------------|-------------------------------------------------------------------------|--------------------------------------------------------|----------------------------------------------------|-------------------------------------|--|--| | Assets | \$ | \$ | \$ | \$ | | | | Common Stock | - | - | - | | | | | Long-term investments | | | 635 | 635 | | | | Total Assets | \$ | - | \$ | \$ | | | | | - | \$ | 635 | 635 | | | The Company did not have any significant transfers between Level 1 and Level 2 during the year ended December 31, 2022. The following table presents additional information about the Company's Level 3 assets measured at fair value. Both observable and unobservable inputs may be used to determine the fair value of positions that the Company has classified within the Level 3 category. As a result, the unrealized gains and losses for assets and liabilities within the Level 3 category may include changes in fair value that were attributable to both observable (e.g., changes in market interest rates) and unobservable (e.g., changes in unobservable long-dated volatilities) inputs. ## *NOTE 5- FAIR VALUE MEASUREN/ENTS (concluded)* Changes in Level 3 assets measured at fair value for the year ended December 31, 2022 are as follows: | | Balance as of
December 31, 2021 | | Purchases | | Sales | Realized and
Unrealized
Gains and
(Losses) | | Net
Transfers
In (0 ut) | Balance as of
December 31, 2022 | | Change in
Unrealized
Gain (Loss)
On J,ong-tcrm
Investments
Still Held | | |-----------------------|------------------------------------|-----|---------------------------|---|---------|-----------------------------------------------------|---|-------------------------------|------------------------------------|-----|--------------------------------------------------------------------------------------|--| | Long-lcrm investments | \$ | 635 | ===== ==== ==== ===
\$ | - | \$
- | \$ | - | \$ | \$ | 635 | ====
\$ | | Valuation techniques and unobservable inputs for Level 3 assets measured at fair value for the year ended December 31, 2022 are as follows: | | Fair Value at | Valuation | Unobsci-vable
Inputs | | |---------------------------------|-------------------|-----------|-------------------------|--| | Level 3 fair value measurements | December 31, 2022 | Technique | | | | Assets: | | | | | | Shares and Warrants | \$
635 | Cost | Market | | | | \$
635 | | | | {17}------------------------------------------------ ## **NOTES TO FINANCIAL STATEMENTS** ## *NOTE6- SUBSEQUENT EVENTS* The Company has performed an evaluation of subsequent events through the date the financial statements were issued. The evaluation did not result in any subsequent events that required adjustments. {18}------------------------------------------------ SUPPLEMENTARY INFORMATION {19}------------------------------------------------ #### **COMPUTATION OF NET CAPTIAL PURSUANT TO UNIFORM NET CAPITAL RULE 15c3-1 DECEMBER 31, 2022** | CREDIT: | | | |-------------------------------------------------------------|----------------|-----------| | Member's equity | \$ | 128,104 | | DEBITS: | | | | N onallowable assets: | | | | Commissions receivable | | 3,750 | | Other Receivables | | 360 | | Long-term Investments, at fu.ir value | | 635 | | Office equipment and leasehold improvements, net | | 955 | | Other assets
Total debits
NET CAPITAL BEFORE HAIRCUTS | 4,279
9,979 | | | | | | | | | | | NET CAPITAL | | 118,125 | | Minimumrequirements of6-2/3% of aggregate indebtedness of | | | | \$199,535 or \$5,000, whichever is greater | | 13,302 | | Excess net capital | \$ | 104,823 | | AGGREGATE INDEBTEDNESS: | | | | Accounts payable and accrued expenses | \$ | 199,535 | | RATIO OF AGGREGATE INDEBTEDNESS TO NET CAPITAL | | 1.69 to 1 | NOTE: There are no material differences between the above computation of net capital and the corresponding computation as submitted by the Company with the unaudited Form X-17A-5 Part II Filing as of December 31, 2022. See accompanying Report oflndependent Registered Public Accounting Firm. 15 {20}------------------------------------------------ ![](_page_20_Picture_0.jpeg) **Certified Public Accountants** 4601 DTCBOULEVARD,SUITE700 DENVER, COLORADO 80237 TELEPHONE: (303) 753:1959 FAX: (303) 753-0338 **www.spicerjeffries.com** #### **REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM** To the Member of GVC Capital LLC We have reviewed management's statements, included in the accompanying exemption report regarding compliance with Rule 15c3-3 exemption report, in which (1) GVC Capital LLC (the "Company") identified the following provisions of 17 C.F.R. §15c3-3(k) under which the Company claimed an exemption from 17 C.F .R. §240. l 5c3-3(k)(2)(ii) (the "exemption provision") and (2) the Company stated that the Company met the identified exemption provision throughout the most recent fiscal year without exception. The Company'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 the Company'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)(2)(ii) of Rule l 5c3-3 under the Securities Exchange Act of 1934. **~LLf** Denver, Colorado February 27, 2023 ![](_page_20_Picture_10.jpeg) {21}------------------------------------------------ ## **EXEMPTION REPORT** To Whom It May Concern, To the best knowledge and belief of **GVC Capital LLC** (the "Company"), the Company claimed exemption from possession or control requirements of SEC Rule 15c3-3 under subparagraph (k)(2)(ii) for the fiscal year ended December 31, 2022. This sub paragraph states: - (k) EXEMPTIONS - (2) The provisions of this rule shall not be applicable to a broker or dealer: - (ii) Who, as an introducing broker or dealer, clears all transactions with and for customers on a fully disclosed basis with a clearing broker or dealer, and who promptly transmits all customer funds and securities to the clearing broker or dealer which carries all of the accounts of such customers and maintains and preserves such books and records pertaining thereto pursuant to the requirements of§§ 240.17a-3 and 240.17a-4 ofthis chapter, as are customarily made and kept by a clearing broker or dealer. The Company met the identified exemption provisions throughout the most recent fiscal year without exception. T. Huebner, Senior Managing Partner Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.