# NAVAID FINANCIAL SERVICES, INC. X-17A-5 (2020-03-02) — Broker-dealer annual report - Company: NAVAID FINANCIAL SERVICES, INC. - Form: X-17A-5 - Filed: 2020-03-02 - Period: 2019-12-31 - Accession: 0001030869-20-000002 - CIK: 1030869 - File #: 8-49897 - Material weakness: No - Auditor: Siana Carr O'Connor & Lynam - Auditor location: Paoli, PA - Contact: John Carney - Phone: 609-238-9370 - Signed by: John Carney (CFO) Original filing: https://www.sec.gov/Archives/edgar/data/1030869/000103086920000002/Filed_Financial_Report_2019a.pdf --- {0}------------------------------------------------ **UNITEDSTATES SECURITIES AND EXCHANGE COMMISSION** Washington, D.C. 20549 0MB APPROVAL 0MB Number: 3235-0123 Expires: August 31, 2020 Estimated average burden hours oer resoonse ...... 12.00 # **ANNUAL AUDITED REPORT FORM X-17A-5 PART Ill** | SEC FILE NUMBER | |-----------------| | | | a-49897 | **FACJNG 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 January 1, 2019 | MM/DD/VY | | AND ENDTNGDecember 31, 2019
MM/DD/VY | | |------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------|---------|-----------------------------------------|--| | | A. REGISTRANT IDENTIFICATION | | | | | NAME oF BROKER-DEALER: Navaid Financial Services, Inc. | | | OFFICIAL USE ONLY | | | ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use P.O. Box No.) | | | FIRM 1.0. NO. | | | 1520 Locust St. 12th Floor | | | | | | | (No. and Street) | | | | | Phlad1~taa | PA | | 19102 | | | (City) | (State) | | (Zip Code) | | | NAME AND TELEPHONE NUMBER OF PERSON TO CONT ACT IN REGARD TO THIS REPORT
John Camey 609-238-9370 | | | | | | | | | (Area Code - Telephone Number) | | | | B. ACCOUNTANT IDENTIFICATION | | | | | INDEPENDENT PUBLIC ACCOUNTANT whose opinion is contained in this Report• | | | | | | Siana Carr O'Connor | | | | | | | (Name - if indil'iduol. stow lost. first. middle name) | | | | | 1500 E. Lancaster Ave. | Paoli | PA | 19301 | | | (Address) | (City) | (Slate) | (Zip Code) | | | CHECK ONE: | | | | | | lvlccrtificd Public Accountant | | | | | | Public Accountant | | | | | | B
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 a11 i11depende11t public accountant | | | | | *must be supported by a statement of facts and circumstances relied on as the basis for the exemption. See Sec lion* 240.17 *a-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 di splays a currently valld 0MB control number.** SEC 1410 (11-05) {1}------------------------------------------------ *Financial Report* # *NA VAID FINANCIAL SER VICES, INC.* *December 31, 2019* {2}------------------------------------------------ #### NA VAID FINANCIAL SERVICES, INC. ## **Financial Statements and Supplementary Financial Information For the Year Ended December 31, 2019** #### **and** ## **REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM** #### **INDEX** | | Page
Number | |--------------------------------------------------------------------------------------------------------|----------------| | Report of Independent Registered Public Accounting Firm | | | Statement of Financial Condition | 2 | | Statement of Operations | 3 | | Statement of Changes in Subordinated Borrowings | 4 | | Statement of Changes in Shareholders' Equity | 5 | | Statement of Cash Flows | 6 | | Notes to Financial Statements | 7-9 | | Supplementary Financial Information | | | Schedule I-Computation of Net Capital Under SEC Rule 15c3-1 | | | Schedule II-Computation for Determination of Reserve Requirements
Under SEC Rule 15c3-l (exemption) | 11 | | Schedule ill-Information for Possession or Control Requirements
Under SEC Rule 15c3-l (exemption) | 12 | | Notes to Supplementary Schedules | 13 | {3}------------------------------------------------ # *SIANA CARR O'CONNOR* **&** *LYNAM, LLP* *Certified Public Accountants* *1500 E. Lancaster Avenue Paoli, PA 19301* *Phone: 610-296-4200* • *Fax: 610-296-3659 www.scolcpa.com* #### **REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM** To the Shareholders ofNavaid Financial Services, Inc. #### **Opinion on the Financial Statements** We have audited the accompanying statement of financial condition of Navaid Financial Services, lnc. as of December 3 1, 2019, the related statements of operations, changes in subordinated borrowings, changes in shareholder's equity, and cash flows for the year then ended, and the related notes (collectively referred to as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of Navaid Financial Services, lnc. as of December 3 1, 2019, 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 Navaid Financial Services, lnc. 's management. Our responsibility is to express an opinion on Navaid Financial Services, lnc.'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 Navaid FinanciaJ Services, Inc. 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 perfom1 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 supplementary financial information contained in Schedules I, II and Ill and notes to supplementary schedules on pages I 0-13 bas been subjected to audit procedures performed in conjunction with the audit of Navaid Financial Services, Inc.'s financial statements. The supplemental information is the responsibility of Navaid FinanciaJ Se.rvices, Inc. 's management. Our audit procedures included determining whether the supplemental information reconciles lo the fmancial 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 supplementary financial information is fairly stated, in all material respects, in relation to the financial statements as a whole. **4.w,.o.. CIIM** *o ~ftM&A.* **'Y~~** J.j.? #### **SI.ANA CARR O'CONNOR** & **LYNAM, LLP** We have served as Navaid Financial Services, lnc.'s auditor since 1995. Paoli, PA February 29, 2020 {4}------------------------------------------------ ## **NA VAID FINANCIAL SERVICES, INC. Statement of Financial Condition December 31, 2019** | Assets | | |---------------------------------------------------------|------------------| | | \$
632,113 | | Cash | 1,528,174 | | Deposits with clearing organization and others | | | Marketable debt securities, at fair value | 10,077,421 | | Receivable, related party | 16,707 | | Accrued interest receivable | 18,115 | | Furniture and equipment, net | 446 | | Total assets | \$
12,272,976 | | | | | Liabilities: | | | Accounts payable and accrued expenses | \$
673,439 | | Payable to clearing organization | 10,088,778 | | Total liabilities | 10,762,218 | | Subordinated borrowings | 1,500,000 | | Shareholders' equity: | | | Common stock (\$.01 par value, 1,000 shares authorized, | | | 106 shares issued and outstanding) | 1 | | Additional paid-in capital | 99,999 | | Retained earnings | (89,241.81) | | Total shareholders' equity | 10,758 | | Total liabilities and shareholders' equity | \$
12,272,976 | **(The accompanying notes are an integral part ofthis financial statement.)** {5}------------------------------------------------ ## **NA VAID FINANCIAL SERVICES, INC. Statement of Operations For the Year Ended December 31, 2019** | Revenues: | | |------------------------------------|-----------------| | Trading gains and losses, net | \$
1,154,005 | | Interest income | 266,205 | | Commission income | 25,107 | | Total revenues | 1,445,317 | | | | | Expenses: | | | Commissions | \$
992,066 | | Employee compensation and benefits | 36,217 | | Interest expense | 258,601 | | Outside services | 199,661 | | Other expenses | 13,738 | | | | | T otaJ expenses | 1,500,283 | | | | | Net loss | \$
(54,966) | **(The accompanying notes are an integral part of this financial statement.)** {6}------------------------------------------------ ## **NA VAID FINANCIAL SERVICES, INC. Statement of Changes in Subordinated Borrowings For the Year Ended December 31, 2019** | Subordinated borrowings at January 1, 2019 | | 1,500,000 | |----------------------------------------------|----|-----------| | 2019 activity | | | | Subordinated borrowings at December 31, 2019 | \$ | 1,500,000 | **(The accompanying notes are an integraJ part of this f"mancial statement.)** {7}------------------------------------------------ ## **NA VAID FINANCIAL SERVICES, INC. Statement of Changes in Shareholders' Equity For the Year Ended December 31, 2019** | | | | | | Additional | | | | |-------------------|--------|--------------|--------|---------|------------|----------|-----------|---------------| | | | Common Stock | | Paid-In | | Retained | | | | | Shares | | Amount | | Capital | | Earnings | Total | | January 01, 2019 | 106 | \$ | | \$ | 99,999 | \$ | 189,955 | \$
289,955 | | Distributions | | | | | | | (224,231) | (224,231) | | Net loss | | | | | | | (54,966) | (54,966) | | December 31, 2019 | 106 | \$ | 1 | \$ | 99,999 | \$ | (89,242) | \$
10,758 | **(The accompanying notes are an integral part of this financial statement.)** {8}------------------------------------------------ ## **NA VAID FINANCIAL SERVICES, INC. Statement of Cash Flows For the Year Ended December 31, 2019** | Cash flows from operating activities: | | |------------------------------------------------|----------------| | Net loss | (54,966)
\$ | | Adjustments to reconcile net loss to net cash | | | provided by operating activities: | | | Depreciation expense | 297 | | (Increase) decrease in: | | | Deposits with clearing organization and others | (13,362) | | Marketable securities | (1,089,288) | | Receivable, related party | (11,362) | | Accrued interest receivable | 25,269 | | Increase (decrease) in: | | | Accounts payable and accrued expenses | 157,934 | | Payable to clearing organization | 1,296,651 | | | | | Net cash provided by operating activities | 311,172 | | | | | Cash flows from financing activities: | | | Distributions | (224,231) | | | | | Net cash used by financing activities | (224,231) | | | | | Net increase in cash | 86,941 | | | | | Cash - beginning of year | 545,172 | | | | | Cash - end of year | 632,113
\$ | | | | | | | | Supplemental cash flow information: | | | Interest paid | 258,601
\$ | **(The accompanying notes are an integral part of this financial statement.)** {9}------------------------------------------------ ## **NA VAID FINANCIAL SERVICES, INC. Notes to Financial Statements December 31, 2019** #### **(1) ORGANIZATION AND BACKGROUND** Navaid Financial Services, Inc. (the Company) is a broker-dealer registered with the Securities and Exchange Commission (SEC) pursuant to Section 17 of the Securities Exchange Act 1934 and is a member of the Financial Industry Regulatory Authority (FINRA). The Company operates on a fully-disclosed basis whereby we do not carry accounts for customers. The Company primarily trades in municipal bonds as proprietary transactions. #### **(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** #### *Management's 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. #### *Securities transactions and commission expense* Proprietary securities transactions are recorded at fair value on the trade date, as if they had settled. Trading gains and losses arising from all securities transactions entered into for the account and risk of the Company, which are not within the scope of ASC 606, along with the related commission expense incurred, are also recorded on a trade date basis. Securities are valued using market value techniques as determined by management based on information provided by third parties and by analyzing inter-dealer trades on or around year-end for all positions held by the Company at year-end. #### *Income taxes* The Company, with the consent of its shareholders, has elected under the Internal Revenue Code of 1986 and comparable state tax provisions to be taxed as an S-Corporation. In lieu of corporation income taxes, the shareholders of an S-Corporation are taxed on their proportionate share of the Company's taxable income. Therefore, no provision or liability for federal or state income taxes has been included in the financial statements. The Company files tax returns in the U.S. federal jurisdiction, certain states and cities. The Company is no longer subject to U.S. federal, state and local examinations by tax authorities for 2013 and prior. #### *Revenue Recognition* The Company buys and sells securities on behalf of its customers. Each time a customer enters into a buy or sell transaction, the Company charges a commission. Commissions and related clearing expenses are recorded on the trade date (the date that the Company fills the trade order by finding and contracting with a counterparty and confirms the trade with the customer). The Company believes that the performance obligation is satisfied on the trade date because that is when the underlying financial instrument or purchaser is identified, the pricing is agreed upon and the risks and rewards of ownership have been transferred to/from the customer. Interest income, which is not within the scope of ASC 606, is recognized when earned. {10}------------------------------------------------ ## **NA VAID FINANCIAL SERVICES, INC. Notes to Financial Statements December 31, 2019** #### **(3) MARKETABLE DEBT SECURITIES** As described in Note 2, the Company values marketable securities at fair value in accordance with Financial Accounting Standards Board (F ASB) *Accounting Standards Codification* (ASC) 820, *Fair Value Measurements.* Investments are classified as Level l, which refers to unadjusted quoted prices in active markets for identical assets that are accessible at the measurement date; Level 2, which refers to inputs other than quoted prices included in Level l that are observable, either directly or indirectly; and Level 3, which refers to unobservable market inputs. All marketable securities held at December 31, 2019 were municipal bonds classified as Level 2 investments within the fair value hierarchy and valued using a market value approach based on market prices of similar securities. #### **(4) RELATED PARTY TRANSACTIONS** The Company provides brokerage services for a fund that is owned and managed by the Company's shareholders. The Company only charges the fund for the Company's expenses incurred. The Company's revenue from the fund was \$22,845 for 2019. \$16,707 was due from the fund at December 31, 2019. Additionally, the Company may buy/sell bonds from/to the fund at cost. The Company also serves as the introducing broker to an investment advisor that is owned and managed by the shareholders. There are minimal trades made during the year. Additionally, the investment advisor earns management fees which pass through the Company's accounts. The Company owed \$3,444 to the investment advisor at December 31, 2019, which is recorded as accounts payable and accrued expenses in the accompanying statement of financial condition. Two of the Company's traders are minority shareholders. The Company incurred commissions of \$992,066 in 2019 to these shareholders. Additionally, \$646,536 is due to the traders at December 31, 2019. #### **(5) RECEIVABLE FROM AND PAYABLE TO CLEARING ORGANIZATION** The Company clears its proprietary and customer transactions through another broker-dealer on a fully disclosed basis. The receivable represents net trading gains earned in December. The amount payable to the clearing broker relates to securities purchased on margin. This balance is secured by the Company's proprietary investments and clearing deposit. The Company's agreement with the clearing broker allows them to borrow **up** to ten times their investment balance, limited to \$15,000,000. The payable balance incurs interest at the federal funds rate plus an applicable margin. #### **(6) SUBORDINATED BORROWINGS** The borrowings under subordinated agreements consist of notes payable to two shareholders. The notes have been renewed through October 2021 and include interest at 5%, which is payable monthly. Interest expense was \$75,000 for 2019. The loans are secured with a deposit at the clearing organization. {11}------------------------------------------------ ## **NA VAID FINANCIAL SERVICES, INC. Notes to Financial Statements December 31, 2019** ### **(7) NET CAPITAL REQUIREMENTS** The Company is subject to the SEC Uniform Net Capital Rule (Rule 15c3-l), which requires the maintenance of a minimum net capital and a ratio of aggregate indebtedness to net capital, not exceeding 15 to l. At December 31, 2019, the Company had net capital, as defined, of\$735,905 which was \$635,905 in excess ofits minimum required net capital of\$ l 00,000. The Company's ratio of aggregate indebtedness to net capital was .91 to l as of December 31 , 2019. The SEC customer protection rule (Rule 15c3-3) requires the maintenance of reserves for customer accounts and sets forth specific guidelines regarding the possession of securities. The Company is exempt from this rule under Reg 240. l5c3-3(k)(2)(ii) which provides an exemption for broker-dealers who operate on a fully-disclosed basis. Therefore, the supplementary financial information in Schedules II and ill on pages 12 and 13 are not applicable. ## **(8) CONCENTRATION OF CREDIT RISK** #### *Cash* The Company maintains its cash accounts at three financial institutions. Balances are insured by the FDIC up to \$250,000 per institution. The uninsured cash balances totaled \$132,113 at December 31, 2019. ## *Marketable debt securities* The Company's proprietary investments consist solely of municipal securities. At December 31, 2019, the balance was comprised of 24 securities, of which the 5 largest positions represented 52% of the total marketable securities balance. ### *Agreements with traders* The Company has agreements with two traders on a month to month basis, of which one trader executes a majority of all trades. If this trader were to terminate the agreement, the ongoing operations of the Company would be materially affected. ### **(9) SUBSEQUENT EVENTS** Management has evaluated subsequent events through the issuance of the financial statements. {12}------------------------------------------------ ## **SUPPLEMENTARY** ## FINANCIAL ## **INFORMATION** {13}------------------------------------------------ ## **NA VAID FINANCIAL SERVICES, INC. Computation of Net Capital Under SEC Rule 15c3-1** ### **December 31, 2019** | Net capital: | | |----------------------------------------------------------------------------------------------------------------|---------------| | Total shareholders' equity | \$
10,758 | | Add - subordinated borrowings allowable as net capital | 1,500,000 | | Total capital and allowable subordinated borrowings | 1,510,758 | | Less - total non-allowable assets | 19,752 | | haircuts on securities | 755,101 | | Net capital | \$
735,905 | | Aggregate indebtedness | \$
673,439 | | Total aggregate indebtedness | \$
673,439 | | Computation of basic net capital requirement: | | | Net capital requirement | \$
100,000 | | Net capital | 735,905 | | Excess of net capital | \$
635,905 | | Net capital less greater of 10% of aggregate indebtedness
or 120% of minimum dollar net capital requirement | \$
615,905 | | Ratio of aggregate indebtedness to net capital | .91 to 1 | {14}------------------------------------------------ ## **NA VAID FINANCIAL** SERVICES, INC. Computation for Determination of Reserve Requirements U oder SEC Rule 15c3-3 December 31, 2019 Not applicable: The Company has claimed an exemption to SEC Rule 15c3-3 pursuant to sub paragraph 15c3-3(k)(2)(ii), and therefore no "Computation for Determination of Reserve Requirement" under that rule has been provided. {15}------------------------------------------------ # NA VAID FINANCIAL SERVICES, INC. Information for Possession or Control Requirements Under SEC Rule 15c3-3 December 31, 2019 Not applicable: The Company has claimed an exemption to SEC Rule 15c3-3 pursuant to sub paragraph 15c3-3(k)(2)(ii), and therefore no "Information for Possession or Control Requirements" under that rule has been provided. {16}------------------------------------------------ ## **NA VAID FINANCIAL SERVICES,** INC. Notes to Supplemental Schedules December 31, 2019 Reconciliation of the audited computation of Net Capital (Schedule I) and the computation of Net Capital included in the Company's unaudited December 31, 2019 FOCUS Part 11A filing. Not Applicable: There are no material differences between the audited computation of Net Capital (Schedule I) and the computation of Net Capital included in the Company's unaudited December 31, 2019 FOCUS Form X-17-A-5 Part llA filing. {17}------------------------------------------------ # *SIANA CARR O'CONNOR* **&** *LYNAM, LLP* *Certified Public Accou11tants* *1500 E. Lancaster Avenue Paoli, PA 19301* *Phone: 610-296-4200* \* *Fax: 610-296-3659 www.scolcpa.com* #### **REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM ON APPLYING AGREED-UPON PROCEDURES** Shareholders ofNavaid Financial Services, Inc. We have performed the procedures included in Rule 17a-5(e)(4) under the Securities Exchange Act of 1934 and in the Securities Investor Protection Corporation (STPC) Series 600 Rules, which are enumerated below and were agreed to by Navaid Financial Services, Tnc. and the STPC, solely to assist you and STPC in evaluating Navaid Financial Services, lnc.'s compliance with the applicable instructions of the General Assessment Reconciliation (Form SIPC-7) for the year ended December 31, 2019. Navaid Financial Services, lnc.'s management is responsible for its form SIPC-7 and for its compliance with those requirements. This agreed-upon procedures engagement was conducted in accordance with standards established by the Public Company Accounting Oversight Board (United States) and in accordance with attestation standards established by the American Institute of Certified Public Accountants. The sufficiency of these procedures is solely the responsibility of those parties specified in this report. Consequently, we make no representation regarding the sufficiency of the procedures described below either for the purpose for which this report has been requested or for any other purpose. The procedures we performed and our findings are as follows: - I) Compared the listed assessment payments in Fotm STPC-7 with respective cash disbursements records entries, noting no differences; - 2) Compared the Total Revenue amount reported on the Annual Audited Form X-l 7A-5 Part III for the year ended December 31, 2019 with the Total Revenue amount reported in Form SIPC-7 for the year ended December 3 l, 2019, noting no differences; - 3) Compared any adjustments reported in Form SIPC-7 with supporting schedules and working papers, noting no differences; - 4) Recalculated the arithmetical accuracy of the calculations reflected in Form SIPC-7 and in the related schedules and working papers supporting the adjustments, noting no differences. - 5) Compared the amount of any overpayment applied to the current assessment with the Form SIPC-7 on which it was originally computed, noting no differences. We were not engaged to and did not conduct an examination or review, the objective of which would be the expression of an opinion or conclusion, on Navaid Financial Services, Inc. 's compliance with the applicable instructions of the Form SIPC-7 for the year ended December 31, 2019. Accordingly, we do not express such an opinion or conclusion. Had we performed additional procedures, other matters might have come to our attention that would have been repmied to you. This report is intended solely for the information and use ofNavaid Financial Services, Inc. and the SIPC and is not intended to be and should not be used by anyone other than these specified parties . *...8.-M* **.\_ C 11M tJ** ~ **cnM&A v ~hf&MJ,** *J..i..?* **SIANA CARR O'CONNOR** & **LYNAM, LLP** Paoli,PA February 29, 2020 {18}------------------------------------------------ # *SIANA CARR O'CONNOR* & *LYNAM, LLP* *Certified Public Accountants* *1500 E. Lancaster Avenue Paoli, PA 19301* *Phone: 610-296-4200* \* *Fax: 610-296-3659 www.scolcpa.com* #### **REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM** To the Shareholders ofNavaid Financial Services, Inc. We have reviewed management's statements, included in the accompanying Statement of Exemption, in which (1) Navaid Financial Services, Inc. identified the following provisions of 17 C.F.R. § 15c3-3(k) under which Navaid Financial Services, Inc. claimed an exemption from 17 C.F.R. §240.l 5c3-3: (k)(2)(ii) (exemption provisions) and (2) Navaid Financial Services, Inc. stated that Navaid Financial Services, Inc. met the identified exemption provisions throughout the most recent fiscal year without exception. Navaid Financial Services, Inc.' 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 Navaid Financial Services, Inc. '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. **~.cAIIL a..** *CaM* d ~ **ftMIA.** ..,~IH6MJ, J..Lr **SIANA CARR O'CONNOR** & **LYNAM, LLP** Paoli, PA February 29, 2020 {19}------------------------------------------------ | SIPC-7 | | |--------|--| | | | SECURITIES INVESTOR PROTECTION CORPORATION P .0. Box 92185 Washington, D.C. 20090-2185 202-371-8300 **SIPC-7** (36-REV 12/18) General Assessment Reconciliation (36-REV 12/18) # For the fiscal year ended **12-31-2019** (Read carefully the instructions in your Working Copy before completing this Form) ## **TO BE FILED BY ALL SIPC MEMBERS WITH FISCAL YEAR ENDINGS** 1. Name of Member, address , Designated Examining Authority, 1934 Act registration no. and month in which fiscal year ends for purposes of the audit requirement of SEC Rule 17 a-5: | | I
7
Navaid Financial Services, Inc
1520 Locust St.
12th Floor | Note: If any of the information shown on the
mailing label requires correction, please e-mail
any corrections to form@sipc.org and so
indicate on the form filed. | c.:,
c.::s
::z
:::.::: | | |--|----------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------|--| | | Philadelphia, PA 19102 | Name and telephone number of person to
contact respecting this form. | a:
c:, | | | | _J
L | John Camey 609-238-9370 | == | | | | 2. A. General Assessment (item 2e from page 2) | s2,019 | | | | | B. Less payment made with SIPC-6 filed (exclude Interest)
10-22-2019 | 11,234
________ _ | | | | | Date Paid | ( | | | | | C. Less prior overpayment applied | | | | | | D. Assessment balance due or (overpayment) | 785 | | | | | __
days at 20°k per annum
E. Interest computed on late payment (see instruction E) for | | | | | | F. Total assessment balance and interest due (or overpayment carried forward) | \$785 | | | | | G. PAYMENT:
J the box
Check mailed to P.O. 801~ Funds Wired
□ ACH0\$785
_________
Total (must be same as F above) | _ | | | | | ________
\$(
H. Overpayment carried forward | _ | | | | | | | | | 3. Subsidiaries (S) and predecessors (P) included in this form (give name and 1934 Act registration number): | The SIPC member submitting this form and the
person by whom it is executed represent thereby
that all information contained herein is true, correct
and complet e. | | | |-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------|--------------------------| | Dated lhe 23
day of February | | | | ent payment is due &O days after the end
This for■ and the assess
for a period of not less than 6 years, the latest 2 years in an easily a | | | | ffi Dates:
;:
Postmarked
Received | Reviewed | | |
> Calculations __
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Documentation
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Forward Copy
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Exceptions: | | | | a
en Disposition of exceptions: | | | {20}------------------------------------------------ ## **DETERMINATION OF "SIPC NET OPERATING REVENUES" AND GENERAL ASSESSMENT** Amounts for the fiscal period beginning 01-01-2019 and ending **12-31-2019** | Hem No.
2a. Total revenue (FOCUS Line 12/ Part IIA. Line 9, Code 4030) | | Eliminate cents
\$1,445,317 | |-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------| | 2b. Additions: | (1) Total revenues from the securities business of subsidiaries (except foreign subsidiaries) and | | | predecessors not included above.
(2) Net loss from principal transactions in securities in trading accounts. | 244,833 | | | (3) Net loss from principal transactions in commodities in trading accounts. | | | | (4) Interest and dividend expense deducted in determining item 2a. | | | | | | | | | (5) Net loss from management of or participation in the underwriting or distribution of securities.
(6) Expenses other than advertising, printing, registration fees and legal lees deducled in detercnining ner
profit from management of or participation in underwriting or distribution of securities. | | | (7) Net loss from securities in investment accounts. | | | | Total additions | | 1,690,150 | | 2c. Deductions:
accounts, and from transactions in security futures products. | (1) Revenues from the distribution of shares of a registered open end investment company or unit
investment trust, from the sale of variable annuities, from the business of insurance, from investment
advisory services rendered lo registered investment companies or insurance company separate | | | (2) Revenues from commodity transactions. | | | | (3) Commissions, floor brokerage and clearance paid to other SIPC eabers in connection with
securities transactions. | 48,202 | | | (4) Reimbursements for postage in connection with proxy solicitation. | | | | (5) Net gain from securities in investment accounts. | 37,471 | | | from issuance date. | (6) 100% of commissions and markups earned from transactions in (i) certificates of deposit and
(ii) Treasury bills, bankers acceptances or commercial paper lhal mature nine QOOlhs or less | | | | (7) Direct expenses of printing advertising and legal lees incurred in connection with other revenue
related to the securities business (revenue delined by Section 16(9)(L) of the Act). | | | (8) Other revenue not related either directly or indirectly to the securities business.
(See Instruction C): | | | | (Deductions in excess of \$100,000 require documentation) | | | | (9) (i) Total interest and dividend expense (FOCUS line 22/PA.RT IIA Line 13,
Code 4075 plus line 2b(4) above) but not in excess
of total interest and dividend income. | 258 601
\$ ___ , _______ | _ | | (ii) 40% of margin interest earned on customers securities
accounts (40% of FOCUS line 5, Code 3960). | __________
\$ | _ | | Enter the greater of lina (i) or (ii) | | 258,601 | | Total deductions | | 344,274 | | 2d . SIPC Net Operating Revenues | s 1,345,876 | | | 2e. General Assessment@ .0015 | \$2,019 | | | | | \to p;e 1, line 2.A.) | {21}------------------------------------------------ # **OATH OR AFFIRM,\fIOII** | l, John Camey | | | | | |----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--|--------------------------------------------------------|------------------------------------------|--| | | | | , swear (or affirm) that, to the best of | | | my knowledge and belief the accompanying financial statement and supporting schedules pertaining to the firm of
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Navaid Financial Services, INC.
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' | | | | | | of December31 | | 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: | | | | | | | | | | | | | | / | | | | | | | | | | | | | | | | | | President/CF | | | | | | V | | | | | | | | | | Notary Public | | ilRYAN MINERVA
Notaty Public • State of New Jer,ey | | | | | | 'My commi,,lon Expire~ Apr 30. 2024 | | | | This report** contains (check all applicable boxes): | | | | | | 0 (a) Facing Page.
0 (b) Statement of Financial Condition. | | | | | | 0 (c) Statement oflncome (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). | | | | | | 0 (d) Statement of Changes in Financial Condition. | | | | | | 0 ( e) Statement of Changes in Stockholders' Equity or Partners' or Sole Proprietors' Capital. | | | | | | 0 (t) 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 J 5c3-3. | | | | | | ~
0 (j) A Reconciliation, including appropriate explanation of the Computation ofNet Capital Under Rule 15c3-l and the | | | | | | Computation for Determination of the Reserve Requirements Under Exhibit A of Rule l 5c3-3. | | | | | | 0 (k) A Reconciliation betwe~n the audited and unaudited Statements of Financial Condition with respect to methods of | | | | | | consolidation. | | | | | | ✓ (1) An Oath or Affirmation. | | | | | | Fl (m) A copy of the SIPC Supplemental Report. | | | | | I (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).* {22}------------------------------------------------ ## **Navaid Financial Services, Inc.** 1520 Locust St 12th Floor Philadelphia, PA 19102 ## Statement of Exemption Navaid Financial Services, Inc. (the "Company") is a registered broker-dealer subject to Rule 17a-5 promulgated by the Securities and Exchange Commission ( 17 C.F.R. §24•0. l 7a-5 , "Reports to be made by certain brokers and dealers"). This Exemption Report was prepared as required by 17 C.F.R. §24•0.17a-5(d)(1) and (4,). To the best of its knowledge and belief, the Company states the following: ( **1)** The Company claimed an exemption from 17 C.F.R. §24-0.15c3-3 under the following provisions of 17 C.F.R. §240.15c3-3 (k): (2)(ii) (2) The Company met the identified exemption provisions in 17 C.F.R. §240.15c3-3(k) throughout the most recent fiscal year without exception. Navaid Financial Services, Inc. I, John A. Carney, swear (or affirm) that, to my best knowledge and belief: this exemption Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.