# SUNBELT SECURITIES, INC. X-17A-5 (2023-03-28) — Broker-dealer annual report
- Company: SUNBELT SECURITIES, INC.
- Form: X-17A-5
- Filed: 2023-03-28
- Period: 2022-12-31
- Accession: 0001026770-23-000002
- CIK: 1026770
- File #: 8-49748
- Type: Broker-dealer
- Material weakness: No
- Auditor: Sanville & Company
- Auditor location: Abington, PA
- Contact: Thomas Buckley
- Phone: 713-965-9510
- Email: david.smetek@sunbeltsecurities.com
- Website: sunbeltsecurities.com
- Signed by: David Smetek (President)
Original filing: https://www.sec.gov/Archives/edgar/data/1026770/000102677023000002/scan1.pdf
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SUNBELT SECURITIES, INC.
REPORT PURSUANT TO RULE 17a-5(d)
DECEMBER 31, 2022
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| UNITED STATES | | |
|------------------------------------|--|--|
| SECURITIES AND EXCHANGE COMMISSION | | |
| Washington, D.C. 20549 | | |
OMB APPROVAL OMB Number: 3235-0123 Expires: Oct. 31, 2023 Estimated average burden
# **ANNUAL REPORTS FORM X-17A-5 PART** Ill
| hours per response: | 12 |
|---------------------|----|
| 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 0110112022 | ~~~~~~~~~- | AND ENDING 1213112022 | | -~~~~~~~~~- |
|------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------------------------------------|-----------------|------------------------------------|
| | MM/DD/ Y Y | | | MM/DD/YY |
| | A. REGISTRANT IDENTIFICATION | | | |
| NAME OF FIRM: Sunbelt Securities, Inc. | | | | |
| ii Broker-dealer | TYPE OF REGISTRANT (check all applicable boxes):
D Security-based swap dealer
D Major security-based swap participant
D Check here if respondent is also an OTC derivatives dealer | | | |
| ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use a P.O. box no.) | | | | |
| 2700 Post Oak Blvd, Ste 1700 | | | | |
| | (No. and Street) | | | |
| Houston | | TX | | 77056 |
| (State)
(City) | | | | (Zip Code) |
| PERSON TO CONTACT WITH REGARD TO THIS FILING | | | | |
| David Smetek | 713.965.9510 | | | david.smetek@sunbeltsecurities.com |
| (Name) | (Area Code -Telephone Number) | | (Email Address) | |
| | 8. ACCOUNTANT IDENTIFICATION | | | |
| INDEPENDENT PUBLIC ACCOUNTANT whose reports are contained in this filing*
Sanville & Company | | | | |
| | | (Name - if individual, state last, first, and middle name) | | |
| 325 N. Saint Paul St, #3100 | Dallas | | TX | 75201 |
| (Address) | (City) | | (State) | (Zip Code) |
| 09/18/03 | | 169 | | |
| | | | | |
| | FOR OFFICIAL USE ONLY | | | |
| * 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 OMB control number.
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#### OATH OR AFFIRMATION
I, David Smetek swear (or affirm) that, to the best of my knowledge and belief, the financial report pertaining to the firm of Sunbelt Securities, Inc as of
3127 2 023 is true and correct. I further swear (or affi ) t t"neither the company nor any partner, officer, director, or equ ivalent person, as the case may be, has any proprietary nte as that of a customer.
| Title: | |
|--------|--|
| | |
#### Notary Public
#### This filing\*\* contains (check all applicable boxes):
- **!!!ii** (a) Statement of financial condition.
- 0 (b) Notes to consolidated statement of financial condition.
- **!!!ii** (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).
- **!!!ii** (d) Statement of cash flows.
- **!!!ii** (e) Statement of changes in stockholders' or partners' or sole proprietor's equity.
- 0 (f) Statement of changes in liabilities subordinated to claims of creditors.
- **!!!ii** (g) Notes to consolidated financial statements.
- **!!!ii** (h) Computation of net capital under 17 CFR 240.1Sc3-1or 17 CFR 240.18a-1, as applicable.
- 0 (i) Computation of tangible net worth under 17 CFR 240.18a-2.
- **!!!ii** (j) Computation for determination of customer reserve requirements pursuant to Exhibit A to 17 CFR 240.1Sc3-3.
- 0 (k) Computation for determination of security-based swap reserve requirements pursuant to Exhibit B to 17 CFR 240.1Sc3-3 or Exhibit A to 17 CFR 240.18a-4, as applicable.
- 0 (I) Computation for Determination of PAB Requirements under Exhibit A to§ 240.1Sc3-3.
- !!!ii (m) Information relating to possession or control requirements for customers under 17 CFR 240.1Sc3-3.
- 0 (n) Information relating to possession or control requirement s for security-based swap customers under 17 CFR 240.1Sc3-3(p)(2) or 17 CFR 240.18a-4, as applicable.
- **!!!ii** (o) Reconciliations, including appropriate explanations, of the FOCUS Report with computation of net capital or tangible net worth under 17 CFR 240.1Sc3-1, 17 CFR 240.18a-l, or 17 CFR 240.18a-2, as applicable, and the reserve requirements under 17 CFR 240.1Sc3-3 or 17 CFR 240.18a-4, as applicable, if material differences exist, or a statement that no material differences exist.
- 0 (p) Summary of financial data for subsidiaries not consolidated in the statement of financial condition.
- **!!!ii** (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.
- 0 (r) Compliance report in accordance with 17 CFR 240.17a-S or 17 CFR 240.18a-7, as applicable.
- **!!!ii** (s) Exemption report in accordance with 17 CFR 240.17a-S or 17 CFR 240.18a-7, as applicable.
- 0 (t) Independent public accountant's report based on an examination of the statement of financial condition.
- **!!!ii** (u) Independent public accountant's report based on an examination of the financia l report or financial statements under 17 CFR 240.17a-5, 17 CFR 240.18a-7, or 17 CFR 240.17a-12, as applicable.
- 0 (v) Independent public accountant's report based on an examination of certain statements in the compliance report under 17 CFR 240.17a-S or 17 CFR 240.18a-7, as applicable.
- !!!ii (w) Independent public accountant's report based on a review of the exemption report under 17 CFR 240.17a-S or 17 CFR 240.18a-7, as applicable.
- 0 (x) Supplemental reports on applying agreed-upon procedures, in accordance with 17 CFR 240.15c3-le or 17 CFR 240.17a-12, as applicable.
- 0 (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). 0 (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.
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# **SUNBELT** SECURITIES, INC.
# CONTENTS
PAGE
| REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM | 1-2 |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------|
| STATEMENT OF FINANCIAL CONDITION | 3 |
| STATEMENT OF OPERATIONS | 4 |
| STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY | 5 |
| STATEMENT OF CASH FLOWS | 6 |
| NOTES TO FINANCIAL STATEMENTS | 7-10 |
| SUPPLEMENTARY INFORMATION | |
| Computation of Net Capital Under Rule 15c3-1
Schedule I:
of the Securities and Exchange Commission | 12-13 |
| Schedule II & Ill: Computation for Determination of Reserve Requirements
And Information Relating To Possessions or Control Requirements
Under Rule 15c3-3 of the Securities and Exchange Commission | 14 |
| REVIEW REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
ON MANAGEMENTS EXEMPTION REPORT | 16-17 |
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ROBERT F. SANVILLE, CPA MICHAEL T. BARANOWSKY, CPA JOHN P. TOWNSEND, CPA NA THANIEL S. HARTGRAVES, CPA
# *S anvi{{e* & *Company*
CERTIFIED PUBLIC ACCOUNTANTS
MEMBER OF AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANIS PENNSYLVANIA INSTITUTE OF CERTIFIED PUBLIC ACCOUNT ANTS
1514 OLD YORK ROAD ABINGTON, PA 19001 (215) 884-8460 • (215) 884-8686 FAX 325 NORTH SAINT PAUL ST. SUITE 3100 DALLAS, TX 75201 (214) 738-1998
100 WALL STREET 8th FLOOR NEW YORK. NY 10005 (212) 709-9512
#### Report of Independent Registered Public Accounting Finn
To the Stockholders of Sunbelt Securities, Inc.
### Opinion on the Financial Statements
We have audited the accompanying statement of financial condition of Sunbelt Securities, Inc. (the Company) as of December 31, 2022, the related statements of operations, changes in stockholders' equity, and cash flows for the year then ended, and the related notes to the financial statements (collectively, 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 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. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.
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.
#### Supplemental Information
The supplementary information contained in The Schedule I, Computation of Net Capital Under SEC Rule 15c3-1, Schedule II, Computation for Determination of Reserve Requirements Under Rule SEC 15c3-3 and Schedule Ill, Information Relating to the Possession or Control Requirements Under SEC Rule 15c3-3 have 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
{5}------------------------------------------------
supplemental information, including Its form and content, is presented in conformity with 17 C.F.R. §240.17a-5. In our opinion, the supplementary information contained in the Schedule I, Computation of Net Capital Under SEC Rule 15c3- 1, Schedule II, Computation for Determination of Reserve Requirements Under SEC Rule 15c3-3 and Schedule Ill, Information Relating to the Possession or Control Requirements Under SEC Rule 15c3-3 are fairly stated. in all material respects, in relation to the financial statements as a whole.
We have served as the Company's auditor since 2019.
Dallas. Texas March 24, 2023
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#### SUNBELT SECURITIES. INC. Statement of Financial Condition December 31. 2022
#### ASSETS
| Cash and cash equivalents | \$ 2,676.446 |
|----------------------------------------------------------------|-------------------|
| Commissions receivable | 337,486 |
| Advisory fees receivable
Deposit with clearing organization | 12,054
100,000 |
| Other receivables | 258,005 |
| Right of use lease asset | 456.744 |
| | |
| Total Assets | \$ 3840.735 |
| LIABILITIES AND STOCKHOLDERS' EQUITY | |
| Liabilities | |
| Accrued expenses | \$
740,329 |
| Commissions payable | 1,602,654 |
| Right of use lease liability | 456.744 |
| Total Liabillties | 2.799.727 |
| Stockholders' equity | |
| Preferred stock, 85,000 shares authorized, | |
| Series A convertible, with \$ .001 par value | |
| 85,000 shares issued and outstanding | 85 |
| Common stock, 10,000,000 shares | |
| authorized with \$.001 par value, | |
| 40,000 shares issued and outstanding | 40 |
| Additional paid in capital | 1,157,918 |
| Accumulated deficit | (117.035) |
| | |
| Total stockholders· equity | 1.041.008 |
| Total Liabilities and Shareholder's Equity | \$ 3.840,735 |
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## SUNBELT SECURITIES. INC. Statement of Operations For the Year Ended December 31. 2022
| Revenues | | |
|-----------------------------------------------------|------------------|---------|
| Advisory Fees | \$
12,705,064 | |
| Commissions | 3,784,982 | |
| Distribution Fees | 4,148,102 | |
| Alternative Investments | 6,282,357 | |
| Other | | 276,954 |
| Interest Income | | 52.665 |
| Total Revenues | 27.250.124 | |
| Expenses | | |
| Commissions and clearance paid to all other brokers | 20,376,932 | |
| Compensation | 4,n8,802 | |
| Insurance | | 312,197 |
| E&O Insurance | | 156,009 |
| Regulatory fees and expenses | | 184,329 |
| Occupancy and equipment costs | | 377,728 |
| Professional fees | | 329,311 |
| Technology and communications | | 434,178 |
| Interest expense | | 30,020 |
| Other expenses | | 265.349 |
| Total Expenses | 27.244.855 | |
| Net Income | | 5.269 |
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| SUNBELT SECURITIES. INC. |
|----------------------------------------------|
| Statement of Changes in Stockholders' Equity |
| For the Year Ended December 31. 2022 |
| | Shares | Preferred
Stock | Shares | Common
Stock | Additional
Paid in
Capital | Accumulated
(Deficit) | Total |
|----------------------------------|-------------------|--------------------|------------|-----------------|----------------------------------|--------------------------|-----------------|
| Balances at
December 31, 2021 | 85,000 \$ | 85 | 40,000 | \$
40 | \$ 1,157,918 \$ (122,304) | | \$ 1,035,739 |
| Net income | ----------------- | | | | | ___ 5
__ ,2_6_9 | __
_.5,_26_9 |
| Balances at
December 31, 2022 | 85,000 \$ | ---
85 | 40,000 _\$ | __ | 4_0 \$ 1,157,918 \$ (117,035) | | \$ 1,041,008 |
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#### SUNBELT SECURITIES. INC. Statement of Cash Flows For the Year Ended December 31. 2022
| Cash flows from operating activities
Net income
Adjustments to reconcile net income to net cash
provided (used} by operating activities: | \$
5,269 |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------|
| Change in assets and liabilities:
Increase in commissions receivable
Increase in advisory fees receivable
Decrease in securities owned
Increase in other receivables
Decrease in accrued expenses
Decrease in commissions payable
Decrease in bank payable | (31,539)
(2,589)
14,009
(18,621)
(429,187)
(295,959)
(1.977) |
| Net cash used in operating activities | (760.594) |
| Cash flows from investing activities | |
| Net cash provided by investing activities | |
| Cash flows from financing activities | |
| Net cash provided by financing activities | |
| Net decrease in cash and cash equivalents | (760.594) |
| Cash and cash equivalents at beginning of year | 3.437.040 |
| Cash and cash equivalents at end of year | \$2676446 |
#### Supplemental Disclosure of Cash Flow Information
#### Cash paid during the year for:
| Interest | 30020
\$ |
|--------------|-------------|
| Income taxes | \$ |
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#### Note 1 -Summary of Significant Accounting Policies
Sunbelt Securities, Inc. (the "Company") was formed October 23, 1996 and became effective as a broker-dealer in securities registered with the Securities and Exchange Commission ("SECn) on July 3, 1997 and is a member of the Financial Industry Regulatory Authority ("FINRA"). The Company operates under SEC Rule 15c3-3(k)(2}(ii), which provides that all funds and securities belonging to the Company's customers would be handled by a correspondent brokerdealer. The Company is a Texas corporation, and its customers are located throughout the United States. The accounting and reporting policies of the Company conform to generally accepted accounting principles in the United States of America and to general practices within the securities industry.
Security transactions (and related commission revenue and expense) are recorded on a trade date basis.
Compensated absences have not been accrued because the amount cannot be reasonably estimated.
Commissions receivable and receivables from broker dealers are generally collected in full in the month following their accrual. As such, management has not recorded an allowance for doubtful accounts on these receivables. The Company advances funds to Its registered representatives as determined necessary by management. The advances are generally recouped upon the following commission payment cycle. Management records an allowance for bad debts based on a collectability review of specific accounts. Any receivables deemed uncollectible are written off against the allowance.
Securities sold not yet purchased represent an obligation of the Company to deliver specified equity securities at a predetermined price. The Company is obligated to acquire the securities at prevalent market prices in the future to satisfy this obligation.
The Company accounts for income taxes in accordance with the Income Taxes Topic of the FASB Accounting Standards Codification. Deferred tax assets and liabilities arising from temporary differences between book and tax basis are recognized using the enacted statutory tax rates and laws that will be in effect when such differences are expected to reverse. Deferred tax assets are recognized for temporary differences that will result in deductible amounts in future years. Deferred tax liabilities are recognized for temporary differences that will result in taxable income in future years. In the case of deferred tax assets, a reduction in deferred tax assets are recorded if it is more likely than not that some portion or all of the deferred tax asset will not be realized. Any interest or penalties associated with income taxes would be included as a component of income tax expense in the period in which the assessment arises.
For purposes of reporting cash flows, the Company has defined cash equivalents as highly liquid investments, with original maturities of less than ninety days that are not held for sale in the ordinary course of business.
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 liabillties 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.
#### Note 2 - Fair Value Measurements
The Company uses various methods including market, income and cost approaches to determine fair value. Based on the approach, the Company often utilizes certain assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and or the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated, or generally unobservable inputs. The Company
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# Note 2 - Fair Value Measurements. continued
utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. Based on the observability of the inputs used in the valuation techniques the Company is required to provide the following information according to the fair value hierarchy. The fair value hierarchy ranks the quality and reliability of the information used to determine fair values. Financial assets and liabilities carried at fair value will be classified and disclosed in one of the following three categories:
Level 1 - Valuations for assets and liabilities traded in active exchange markets, such as the New York Stock Exchange. Level 1 also includes U.S. Treasury and federal agency securities and federal agency mortgage-backed securities, which are traded by dealers or brokers in active markets. Valuations are obtained from readily available pricing sources for market transactions involving identical assets or liabilities.
Level 2- Valuations for assets and liabilities traded in less active dealer or broker markets. Valuations are obtained from third party pricing services for identical or similar assets or liabilities.
Level 3 - Valuations for assets and liabilities that are derived from other valuation methodologies, including option pricing models, discounted cash flow models and similar techniques, and not based on market exchange, dealer, or broker traded transactions. Level 3 valuations incorporate certain assumptions and projections in determining the fair value assigned to such assets or liabilities.
For the year ended December 31, 2022, the application of valuation techniques applied to similar assets and liabilities has been consistent.
There were no transfers into or out of the Level 1, 2 or 3 categories in the fair value measurement hierarchy for the fiscal year ended December 31, 2022.
#### Note 3 - 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. Net capital and the related net capital ratio may fluctuate on a daily basis.
As of December 31, 2022, the Company had net capital of \$802,348 and net capital requirements of \$156,199. The Company's ratio of aggregate indebtedness to net capital was 2.92 to 1. The Securities and Exchange Commission permits a ratio of no greater than 15 to 1.
#### Note 4 - Income Taxes
The Company's federal and state income tax returns are subject to examination over various statutes of limitations generally ranging from three to five years.
Page8
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# Note 5 - Concentration Risk
At various times during the year, the Company had cash balances in excess of federally insured limits.
#### Note 6 - Lease Commitments
The Company leases office space under an operating lease agreement that expires in April 2026. Rental expense of \$377,728 was charged to operations for the year ended December 31, 2022.
Future minimum lease payments under the lease liabilities together with the present value are as follows:
| 208,392 |
|---------------|
| 212,546 |
| 216,700 |
| 73.387 |
| \$
711 025 |
| 711,026 |
| (254.282) |
| \$
456.744 |
| \$
\$ |
#### Note 7 - Revenue Recognition
Revenues are recognized when control of the promised services is transferred to customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those services. Revenues are analyzed to determine whether the Company is the principal (i.e., reports revenues on a gross basis) or agent (i.e., reports revenues on a net basis) in the contract. Principal or agent designations depend primarily on the control an entity has over the product or service before control is transferred to a customer.
#### Advisory Fees
Investment advisory fees. The Company provides investment advisory services on a daily 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 customers assets under management. Fees are received quarterly and are recognized as revenue at that time as they relate specifically to the services provided in that period, which are distinct from the services provided in other periods.
#### Commission Revenue
Commission revenue is generally recognized at a point in time upon delivery of contracted services based on a predefined contractual amount on a trade date for a trade execution services based on providing market prices and internal and regulatory guidelines. Commission revenue consists of the sale of equity and fixed income securities and unit investment trusts.
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### Note 7 - Revenue Recognition. continued
#### Distribution Fees
# Mutual Funds, Insurance and Annuity Products
The Company earns revenue for selling affiliated and unaffiliated mutual funds, fixed variable annuities and insurance products. The performance obligation is satisfied at the time of each individual sale. A portion of the revenue is based on a fixed rate applied, as a percentage, to amounts invested at the time of sale. The remaining revenue is recognized over the time the client owns the investment or holds the contract and is generally earned based on a fixed rate applied, as a percentage, to the net asset value of the fund, or the value of the insurance policy or annuity contract. The ongoing revenue is not recognized at the time of sale because it is variably constrained due to factors outside the Company's control including market volatility and client behavior (such as how long clients hold their investment, insurance policy or annuity contract). The revenue will not be recognized until it is probable that a significant reversal will not occur.
#### Alternative Investments
Alternative Investment revenues are recorded when all contractual obligations have been performed and the Company is reasonably assured of their collection. The contractual obligations especially include securing the necessary approvals from the transfer agents and general partners on the respective transactions. Generally, revenues are due at or shortly after the close of the respective transaction, and therefore the Company does not have a significant amount of commissions receivable at the end of a reporting period.
#### Note 8 - Commitments and Contingencies
Included in the Company's clearing agreement with its clearing broker-dealer, is an indemnification clause. This clause relates to instances where the Company's customers fail to settle security transactions. In the event this occurs, the Company will indemnify the clearing broker-dealer to the extent of the net loss on the unsettled trade. As of December 31, 2022, management of the Company had not been notified by the clearing broker-dealer, nor were they otherwise aware, of any potential losses relating to this indemnification.
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Supplementary Information Pursuant to Rule 17a-5 of the Securities Exchange Act of 1934 as of
December 31, 2022
{15}------------------------------------------------
# Schedule I
# SUNBELT SECURITIES. INC. Computation of Net Capital Under Rule 15c3-1 of the Securities and Exchange Commission As of December 31. 2022
#### COMPUTATION OF NET CAPITAL
| Total stockholders' equity qualified for net capital | \$ 1,041,008 |
|----------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------------------|
| Add:
Other deductions or allowable credits | |
| Total capital and allowable subordinated liabilities | 1.041.008 |
| Deductions and/or charges | |
| Less Non-allowable assets
Other receivables
Advisory fees receivable
Total non allowable
Net capital before haircuts on securities positions | 173,389
12.054
185.443
855,565 |
| Haircuts on securities (computed, where applicable,
pursuant to Rule 15c3-(1c)(2)
Other securities | 53.217 |
| Net capital | \$
802 348 |
| AGGREGATE INDEBTEDNESS | |
| Items included in statement of financial condition
Accrued expenses
Commissions payable | \$
740,329
1.602.654 |
| Total aggregate indebtedness | \$ 2 342 983 |
{16}------------------------------------------------
# Schedule I (continued)
## SUNBELT SECURITIES. INC. Computation of Net Capital Under Rule 15c3-1 of the Securities and Exchange Commission As of December 31. 2022
# COMPUTATION OF BASIC NET CAPITAL REQUIREMENT
| Minimum net capital required (6 2/3% of total
aggregate indebtedness) | \$
156199 |
|-------------------------------------------------------------------------------|---------------|
| Minimum dollar net capital requirement of
reporting broker or dealer | \$
100 000 |
| Net capital requirement (greater of above two
minimum requirement amounts) | \$
156199 |
| Net capital in excess of required minimum | \$
646149 |
| Ratio: Aggregate indebtedness to net capital | 292to1 |
#### Reconciliation with company's computation
There was no material difference in the computation of net capital under Rule 15c3-1 from the Company's computation.
{17}------------------------------------------------
# **Schedule II** & Ill
#### SUNBELT SECURITIES. INC. Computation for Determination of Reserve Requirements and Information Relating To Possession or Control Requirements Under Rule 15c3-3 of the Securities and Exchange Commission
The Company is exempt from Securities Exchange Commission ("SEC") Rule 15c3-3 pursuant to both the exemptive provisions of sub-paragraph (k)(2)(ii) and is considered a 11Non-Covered Firm" from 15c3-3 by relying on footnote 74 to SEC Release 34-70073 and therefore, is not required to maintain a "Special reserve bank account for the Exclusive benefit of customers."
{18}------------------------------------------------
#### REVIEW REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
#### ON MANAGEMENrs EXEMPTION REPORT
Required By SEC Rule 17a-5
Year Ended December 31, 2022
{19}------------------------------------------------
ROBERT F. SANVILLE, CPA MIOIAEL T. BARANOWSKY, CPA JOHN P. TOWNSEND, CPA NATHANIEL S. HARn:iRA VES, CPA
# *S anvi{{e* & *Company*
CERTIFIED PUBLIC ACCOUNTANTS
MEMBER OF AMERICAN lNSlITUTE OF CERTIFIED PUBLIC ACCOUNT ANTS PENNSYLVANIA INSlITUTE OF CERTIFIED PUBLIC ACCOUNT ANTS
1514 OLD YORK ROAD ABINGTON, PA 19001 (215) 884-8460 • (215) 884-8686 FAX 325NORTH SAINT PAUL sr. SUITE 3100 DALLAS, TX 75201 (214) 738-1998
100 WALL srREET 8th FLOOR NEW YORK. NY 10005 (212) 709-9512
#### Report of Independent Registered Public Accounting Firm
To the Stockholders of Sunbelt Securities, Inc.
We have reviewed managemenfs statements, included in the accompanying Exemption Report, in which Sunbelt Securities, Inc. (the Company) stated that:
- 1. The Company identified the following provisions of 17 C.F.R. § 240.15c3-3(k) under which the Company claimed an exemption from 17 C.F.R. § 240.15c3-3: Paragraph (k)(2)(ii) (the exemption provisions), and the Company stated that it met the identified exemption provisions throughout the most recent fiscal year without exception;
- 2. The Company is also filing this Exemption Report because the Company's other business activities contemplated by Footnote 74 of the SEC Release No. 34-70073 adopting amendments to 17 C.F.R. § 240.17a-5 are limited to (1) underwriter or selling group participant (2) acting as a mutual fund retailer (3) broker or dealer selling variable life insurance or annuities (4) solicitor of time deposits in a financial institution (5) investment advisory services (6) broker or dealer selling tax shelters or limited partnerships in primary distributions (7) private placement of securities throughout the most recent fiscal year; and
- 3. The Company (1) did not directly or indirectly receive, hold, or otherwise owe funds or securities for or to customers (other than money or other consideration received and promptly transmitted in compliance with paragraph (a) or (b)(2) of 17 C.F.R. § 240.15c2-4; (2) did not carry accounts of or for customers; and (3) did not carry proprietary accounts of broker-dealers (as defined in 17 C.F.R. § 240.15c3-3), throughout the most recent fiscal year without exception.
The Company's management is responsible for 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 and that the Company's other business activities were limited to (1) underwriter or selling group participant (2) acting as a mutual fund retailer (3) broker or dealer selling variable life insurance or annuities (4) solicitor of time deposits in a financial institution (5) investment advisory services (6) broker or dealer selling tax shelters or limited partnerships in primary distributions (7) private placement of securities and (1) did not directly or indirectly receive. hold, or otherwise owe funds or securities for or to customers (other than money or other consideration received and promptly transmitted in compliance with paragraph (a) or (b)(2) of 17 C.F.R. § 240.15c2-4; (2) did not carry accounts of or for customers; and (3) did not carry proprietary accounts of broker-dealers (as defined in 17 C.F.R. § 240.15c3-3) throughout the most recent fiscal year without exception. 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 managemenfs statements referred to above for them to be fairly stated, in all material respects, based on the provisions set forth in 17 C.F.R. § 240.15c3-3 and 17 C.F.R. § 240.17a-5.
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Dallas, Texas March 24, 2023
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#### Sunbelt Securities, Inc. Exemption Report
Sunbelt Securities, Inc. (the °Companf) Is a registered broker-dealer subject to Rule 17a-5 promulgated by the Securities and Exchange Commission (17 C.F.R §240.17a-5, 'Reports to be made by certain brokers and dealers•). This Exemption Report was prepared as required by 17 C.F.R. §240.17a-5(d)(1) and (4). To the best of its knowledge and belief, the Company states the following:
- (1) The Company clalmed an exemption from 17 C.F.R. §240.15c3-3 under the following provlsfons of 17 C.F.R. §240.15c3-3(k)(2)(1~.
- (2) The Company met the Identified exemption provisfons In 17 C.F.R. §240.15c3-3(k) throughout the most recent fiscal year without exception.
- (3) The Company Is considered 'Non-Covered Arm• exempt from 17 C.F.R §240.15c3-3 and ls fD!ng an Exemption Report relying en footnote 74 to SEC Release 34-70073, and as discussed in Q&A 8 of the related FAQ issued by the SEC staff. The Company limits its business activities exclusively to: (1) underwriter or selling group participant (2) acting as a mutual fund retailer (3) broker or dealer sel!lng variable life Insurance or annuities (4) solicltor of time deposits In a financial institution (5) Investment advisory services (6) broker or dealer selOng tax shelters or limited partnerships In primary dlstnbutlons (7) private placements of securities.
- (4) The Company (1) did not dlrecUy or Indirectly receive, held or otherwise owe funds or securities for or to customers, other than money or other consideration received and prompUy transmitted in compliance with paragraph (a) or (b)(2) of Ru!e 15c2-4: (2) dtd not carry accounts of or for customers: and (3) did not cany PAS accounts (as defined in Rule 15c3-3), throughout the most recent fiscal year without exception.
I, Thomas Buckley, swear (or affinn) that, to my best knowledge and belief, this exemption report is true and correct.
Reg!!:lma.\_\_... ......
Date of Report: February 13, 2023
Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.