# NAVAID FINANCIAL SERVICES, INC. X-17A-5 (2021-03-02) — Broker-dealer annual report - Company: NAVAID FINANCIAL SERVICES, INC. - Form: X-17A-5 - Filed: 2021-03-02 - Period: 2020-12-31 - Accession: 0001030869-21-000001 - CIK: 1030869 - File #: 8-49897 - Material weakness: No - Auditor: Siana Carr and O'Connor - Auditor location: Paoli, PA - Contact: John Carney - Phone: 6092389370 - Website: scolcpa.com - Signed by: John Carney (President/CFO) Original filing: https://www.sec.gov/Archives/edgar/data/1030869/000103086921000001/auditedannualreport.pdf --- {0}------------------------------------------------ **UNITEDSTATES SECURITIESANDEXCHANCECOMMJSSION Washington, D.C. 20549** #### 0MB APPROVAL 0MB Number. 3235-0123 Expires: October 31, 2023 Estimated average burden hours per response ...... 12.00 # **ANNUAL AUDITED REPORT FORM X-17A-5 PARTIII** | | SEC FILE NUMBER | | |----|-----------------|--| | 8- | | | **FACING PAGE Information Required of Brokers and Dealers Pursuant to Section 17 of the Securities Exchange Act of 1934 and Rule 17a-5 Thereunder** | REPORT FOR THE PERIOD BEGINNING01/01/202Q | | AND ENDING 12/31/2020 | | | |---------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------|-----------------------|-------------------|--| | | MM/DD/YY | | MM/DD/YY | | | | A. REGISTRANT IDENTIFICATION | | | | | NAME OF BROKER-DEALER: | Navaid Financial Services, Inc | | OFFICIAL USE ONLY | | | ADDRESS OF PRINCIPAL PLACE OF BUSINESS:
21 E. Eucl[d Ave | (Do not use P.O. Box No.) | | FIRM I.D. NO. | | | | (No. and Street) | | | | | HaSiana Carr and O'Connor | B. ACCOUNTANT IDENTIFICATION
(Name -if i11di~idual, state last, first. middle name) | | | | | 1500 E. Lancaster Ave | Paoli | PA | 19301 | | | (Address) | (City) | (State) | (Zip Code) | | | CHECK ONE: | | | | | | Iv' I
certified Public Accountant
B
Public Accountant
Accountant not resident in United States or any of its possessions. | | | | | | | FOR OFFICIAL USE ONLY | | | | | | | | | | | | | | | | *\*Claims for exemption from the requirement that the annual report be covered by the opinion of an independent public accountant must be supported by a statement of/acts and circumstances relied on as the basis for the exemption. See Section 240.17a-5(e)(2)* > **Potential persons who are to respond to the collection of information contained In this form are not required to respond unless the form displays a currently valid 0MB control number.** SEC 1410 (11-05) {1}------------------------------------------------ ### **OATH OR AFFIRMATION** | 1, John Carney | | , swear (or affirm) that, to the best of | |---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------|--------------------------------------------------------| | my knowledge and belief the accompanying financial statement and supporting scheduJes pertaining to the finn of
Navaid Financial Services, Inc
------------------------------------------, | | as | | of December 31 | | arc true and correct. 1 further swear (or affirm) that | | neither lhe 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: | | | | | | | | | | | | | Notary Public | | | | State of New Jersey | | | Notary Public | ID# 2438446 | | | This report** contains (check all applicable boxes):
0 (a) Facing Page.
0 (b) Statement of Financial Condition.
~ (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).
(d) Statement of Changes in Financial Condition.
.i
(e) Statement of Changes in Stockholders' Equity or Partners' or Sole Proprietors' CapitaL
r
(f) Statement of Changes in Liabilities Subordinated to Claims of Creditors.
~.,,
(g) Computation of Net Capital.
.i
(h) Computation for Determination of Reserve Requirements Pursuant to Rule l5c3-3.
r
~v
(i) Information Relating to the Possession or Control Requirements Under Rule I Sc3-3.
0 (j)
A Reconciliation, including appropriate explanation of the Computation of Net Capital Under Rule 15c3-l and the
Computation for Determination of the Reserve Requirements Under Exhibit A of Rule l5c3-3.
0 (k) A Reconciliation between the audited and unaudited Statements of Financial Condition with respect lo methods of
consolidation.
(1) An Oath or Affirmation.
.i
(m) A copy of the SIPC Supplemental Report.
r | l\/1y Commission Expires 09/13/2023 | | | (n) A report describing any material inadequacies found to exist or found co have existed since the date of the previous audit.
~ | | | | ** For conditions of confidential treatment of certain portions of this filing, see section 240. 17 a-5(e) (3). | | | {2}------------------------------------------------ *Financial Report* # *NAV AID FINANCIAL SERVICES, INC.* *December 31, 2020* {3}------------------------------------------------ ## **NA VAID FINANCIAL SERVICES, INC.** # **Financial Statements and Supplementary Financial Information For the Year Ended December 31, 2020** **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 1 Sc3-1 | | | Schedule Il-Computation for Determination of Reserve Requirements
Under SEC Rule 15c3-1 (exemption) | 11 | | Schedule ill-Information for Possession or Control Requirements
Under SEC Rule 15c3-l (exemption) | 12 | | Notes to Supplementary Schedules | 13 | {4}------------------------------------------------ # *SIANA CARR O'CONNOR* **&** *LYNAM, LLP* *Certified Public Accountants* *1500 E. Lancaster Avenue Paoli1 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 ofNavaid Financial Services, Inc. as ofDecember 31, 2020, 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, Inc. as of December 31, 2020, and the results of its operations and its ca.sh 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 ofNavaid Financial Services, lnc.'s management. Our responsibility is to express an opinion on Navaid Financial Services, Inc.'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 Finan.cial Services, Tnc. fo accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audit included performing procedures to assess the risks of material misstatement of the financiaL statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion. #### **Auditor's Report on Supplemental Information** The supplementary financial information contained in Schedules I, II and ffi and notes to supplementary schedules on pages 10-13 bas been subjected to audit procedures perfonned in conjunction with the audit ofNavaid Financial Services, Inc.'s financial statements. The supplemental infonnation is the responsibility of Navaid Financial Services, Inc. 's management. Our audit procedures included determining whether the supplemental information reconciles to the financial statements or the underlying accounting and other records, as applicable, and performing procedures to test the completeness and accuracy of the information presented in the supplemental information. In forming our opinion on the supplemental information, we evaluated whether the supplemental .information, including its form and content, is presented in conformity with 17 C.F.R. §240.17a-5. ln our opinion, the supplementary financial information is fairly stated, in all material respects, in relation to the financial statements as a whole. **A!~o.. c4M."eo1'41AY~~""-,** **SlANA CARR O'CONNOR** & **LYNAM, LLP** We have served as Navaid Financial Services, Inc.'s auditor since 1995. Paoli, PA February 25, 2021 {5}------------------------------------------------ # **NA V AJD FINANCIAL SERVICES, INC. Statement of Financial Condition December 31, 2020** | Assets | | |---------------------------------------------------------|-----------------| | Cash | \$
1,024,432 | | Deposits with clearing organization and others | 1,527,700 | | Marketable debt securities, at fair value | 7,196,330 | | Receivable from clearing organization and others | 144,959 | | Accrued interest receivable | 6,199 | | Furniture and equipment, net | 2,608 | | Total assets | \$
9,902,228 | | | | | Liabilities: | | | Accounts payable and accrued expenses | \$
770,477 | | Payable to clearing organization | 7,093,722 | | Total liabilities | 7,864,199 | | Subordinated borrowlngs | 1,500,000 | | Shareholders' equity: | | | Common stock (\$.01 par value, 1,000 shares authorized, | | | 106 shares issued and outstanding) | l | | Additional paid-in capital | 99,999 | | Retained earnings | _ 438,029 | | Total shareholders' equity | 538,029 | | Total liabilities and shareholders' equity | \$
9,902,228 | **(The accompanying notes aa-e an integral part of this financial statement.)** {6}------------------------------------------------ # **NA VAID FINANCIAL SERVICES, lNC. Statement of Operations For the Year Ended December 31, 2020** | Revenues: | | |------------------------------------|-----------------| | Trading gains and losses, net | \$
3,964,375 | | Interest income | 182,887 | | Commission income | 30,048 | | Total revenues | 4,177,310 | | Expenses: | | | Commissions | 3,162,046 | | Employee compensation and benefits | 105,540 | | Interest expense | 144,545 | | Clearing services | 52,115 | | Technology services | 92,347 | | Occupancy and office | 11,890 | | Other expenses | 81,557 | | Total expenses | 3,650,039 | | Net Income | \$
527,271 | **(The accompanying notes are an integral part of this financial statement)** {7}------------------------------------------------ # **NA VAID FINANCIAL SERVICES, INC. Statement of Changes in Subordinated Borrowings For the Year Ended December 31, 2020** | Subordinated borrowings at January 1, 2020 | \$
1,500,000 | |----------------------------------------------|-----------------| | 2020 activity | | | Subordinated borrowings at December 31, 2020 | \$
1,500,000 | **(Tbe accompanying notes are an integral part of this financial statement.)** {8}------------------------------------------------ # **NA VAID FINANCIAL SERVICES, INC. Statement of Changes in Shareholders' Equity For the Year Ended December 31, 2020** | | Common Stock | | Additional
Paid-In | Retained | | |-------------------|--------------|---------|-----------------------|----------------|---------------| | | Shares | Amount | Capital | Earnings | Total | | January 0 1, 2020 | 106 | \$
1 | \$
99,999 | \$
(89,242) | \$
10,758 | | Distributions | | | | | | | Net Income | | | | 527,271 | 527,271 | | December 31, 2020 | 106 | \$
1 | \$
99,999 | \$
438,029 | \$
538,029 | **(The accompanying notes are an integral part of this financial statement.)** {9}------------------------------------------------ # **NA VAID FINANCIAL SERVICES, INC. Statement of Cash Flows For the Year Ended December 31, 2020** | Cash flows from operating activities: | | |------------------------------------------------------|-----------------| | Net Income | \$
527,271 | | Adjustments to reconcile net loss to net cash | | | provided by operating activities: | | | Depreciation expense | 912 | | (Increase) decrease in: | | | Deposits with clearing organization and others | 474 | | Marketable securities | 2,881,091 | | Receivable from clearing organization and others | (128,252) | | Accrued interest receivable | 11,916 | | Increase (decrease) in: | | | Accounts payable and accrued expenses | 97,038 | | Payable to clearing organization | (2,995,056) | | Net cash provided by operating activities | 395,394 | | Cash flows from investing activities: | | | Purchase of furniture and equipment | (3,075) | | Net cash used by investing activities | (3,075) | | Net increase in cash | 392,319 | | Cash -
beginning of year | 632,113 | | Cash -
end of year | \$
1,024,432 | | Supplemental cash flow information:
Interest eaid | \$
146,178 | **(The accompanying notes are an integral part of this financial statement.)** {10}------------------------------------------------ # **NA VAID FINANCIAL SERVlCES, INC. Notes to Financial Statements December 31, 2020** #### **(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 Fi11ancial Industry Regulatory Authority (FfNRA). 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** #### *Ma,iageme11t's estimates* The preparation of financial statements in confonnity 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 liabi I ities 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 transactio,is 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 infonnation 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 2016 and prior. #### *Revenue Recognitio11* 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. {11}------------------------------------------------ # **NA VAID FINANCIAL SERVICES, INC. Notes to Financial Statements December 31, 2020** #### **(3) MARKET ABLE 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 I, 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 1 that are observable, either directly or indirectly; and Level 3, which refers to unobservable market inputs. All marketable securities held at December 31, 2020 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 \$27,544 for 2020. \$902 was due from the fund at December 31, 2020. Addittonally, 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 minima.I trades made dw·ing 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, 2020, 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 incmTed commissions of \$3,162,046 in 2020 to these shareholders. Additionally, \$743,579 is due to the trailers at December 3J, 2020. ### **(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 oet 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 eight times their investment baJance, limited to \$10,4000,000. 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 2022 and include interest at 5%, which is payable monthly. lnterest expense was \$75,000 for 2020. The loans are secured with a deposit at the clearing organization. {12}------------------------------------------------ # **NAV AID FINANCIAL SERVICES, INC. Notes to Financial Statements December 31, 2020** ### **(7) NET CAPITAL REQUIREMENTS** The Company is subject to the SEC Unifonn Net Capital Rule (Rule l Sc3-I), which requires the maintenance of a minimum net capital and a ratio of aggregate indebtedness to net capital, not exceeding l 5 to 1. At December 31, 2020, the Company had net capital, as defined, of \$1,558,790 which was \$1,458,790 in excess of its minimum required net capital of \$100,000. The Company's ratio of aggregate indebtedness to net capital was .49 to I as of December 31, 2020. 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 th is rule under Reg 240. l Sc3-3(k )(2 )(ii) which provides an exemption for broker-dealers who operate on a fully-disclosed basis. Therefore, the supplementary financial information in Schedules TT and ID on pages 11 and 12 are not applicable. ## **(8) OFFICE LEASE** The Company leases office space on a month-to-month basis. Rent expense was \$11,890 for 2020. ### **(9) RETIREMENT PLAN** T.be Company has a 40l(k) plan which covers substantially all employees. The Company may make discretionary matching contributions equal to a percentage of an employees contributions, which are determined each year. No contributions were made in 2020. ### **(10) 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 \$1,224,433 at December 31, 2020. ### *Marketable debt securities* The Company's proprietary investments consist solely of municipal securities. At December 31, 2020, the balance was comprised of 19 securities, of which the 5 largest positions represented 43% 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. ### **(11) SUBSEQUENT EVENTS** Management has evaluated subsequent events through the issuance of the financial statements. {13}------------------------------------------------ ## SUPPLEMENTARY ## FINANCIAL # INFORMATION {14}------------------------------------------------ ## **Schedule I** # **NA VAID FINANCIAL SERVICES, INC. Computation of Net Capital Under SEC Rule 15c3-1** ## **December 31, 2020** | Net capital: | | |----------------------------------------------------------------------------------------------------------------|-----------------| | Total shareholders' equity | \$
538,029 | | Add -
subordinated borrowings allowable as net capital | 1,500,000 | | Total capital and allowable subordinated borrowings | 2,038,029 | | Less -total non-allowable assets | 4,064 | | haircuts on securities | 475,175 | | Net capital | \$
1,558,790 | | Aggregate indebtedness | \$
770,477 | | Total aggregate indebtedness | \$
770,477 | | Computation of basic net capital requirement: | | | Net capital requirement | \$
100,000 | | Net capital | 1,558,790 | | Excess of net capital | \$ 1,458,790 | | Net capital less greater of 10% of aggregate indebtedness
or 120% of minimum dollar net capital requirement | \$ 1,438,790 | | Ratio of aggregate indebtedness to net capital | .49 to l | {15}------------------------------------------------ ## Schedule II # NA VAID FINANCIAL SERVICES, INC. Computation for Determination of Reserve Requirements Under SEC Rule 15c3-3 December 31, 2020 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. {16}------------------------------------------------ ## Schedule III # NA VAID FINANCIAL SERVICES, INC. Information for Possession or Control Requirements Under SEC Rule 15c3-3 December 31, 2020 Not applicable: The Company bas 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 bas been provided. {17}------------------------------------------------ # **NA VAID FINANCIAL** SERVICES, INC. Notes to Supplemental Schedules December 31, 2020 Reconciliation of the audited computation of Net Capital (Schedule I) and the computation of Net Capital included in the Company's unaudited December 31, 2020 FOCUS Part IIA 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, 2020 FOCUS Form X-17-A-5 Part IlA filing. {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 FinanciaJ Services, Inc. claimed an exemption from 17 C.F.R. §240.15c3-3: (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, lnc.'s compliance with the exemption provisions. A review is substantially less in scope than an examination, the objective of wbich 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 l5c3-3 under the Securities Exchange Act of 1934 . **..tAAl!t a.. CCIM** *o*~ ~ **.,~n,GIIICJ,** *J..1.r* **SIANA CARR O'CONNOR** & **LYNAM, LLP** Paoli, PA February 25, 2021 {19}------------------------------------------------ # **Navaid Financial Services, Inc.** 21 E. Euclid Ave Haddonfield, NJ 08033 ## Statement of Exemption Navaid Financial Services, Inc. (the "Company") is a registered broker-dealer subject to Rule l 7a-5 promulgated by the Securities and Exchange Commission ( 17 C.F.R. §21-0.17a-6 , "Reports to be made by certain brokers and dealers"). This Exemption Report was prepared as required by 17 C.F.R. §24O.I7a-.5(d)(1) and (1•). To the best of its knowledge and belief, the Company states the following: (1) The Company claimed an exemption from 17 C.F.R. §240.15cs-s under the following provisions of I 7 C.F.R. §24O.15cS-S (k): (2)(ii) (2) The Company met the identified exemption provisions in 17 C.F.R. §24O.15cs-s(k) throughout the most recent fiscal year without exception. Navaid Financial Services, Inc. I, John A. Carney, swear (or affirm) that, to my best lmowledge and belief, this exemption {20}------------------------------------------------ # *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 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 (SrPC) Series 600 Rules, which are enumerated below and were agreed to by Navaid Financial Services, Inc. and the SIPC, solely to assist you and SIPC in evaluating Navaid Financial Services, Inc.'s compliance with the applicable instructions of the General Assessment Reconciliation (Form SIPC-7) for the year ended December 31, 2020. Navaid Financial Services, Inc. '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 Accow,ting 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 perfo1med and our findings are as follows: - 1) Compared the listed assessment payments in Form SlPC- 7 with respective cash disbursement records entries, noting no differences; - 2) Compared lhe Total Revenue amount reported on the Annual Audited Fonn X-17A-5 Part III for the year ended December 31, 2020 witl1 the TotaJ Revenue amount reported in Form SIPC-7 for the year ended December 31, 2020, noting no differences; - 3) Compared any adjustments reported in Form STPC-7 with supporting schedules and workjng 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 aoy 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 Fonn SIPC-7 for the year ended December 31, 2020. 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 reported to you. This report is intended solely for the info1malion and use ofNavaid Financial Services, Inc. and the SIPC and is not intended to be and should not be useP.O. 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 12/31/2020
(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 17a-5: | | | | | ~-21
49897 | ···**1467**•*•**•••'***••·····MIxeD
FINRA
DEC
NAVAIO FINANCIAL SERVICES INC
1520 LOCUST ST 12TH FL
PHILADELPHIA, PA 19102-4403 | 7
AADC 220 | Note: If any of the information shown on the
any corrections to form@sipc.org and so
indicate on the form filed.
Name and telephone number of person to
contact respecting this form. | mailing label requires correction, please e-mail | | L | | _j | | | | | | | | | | | | | | | | | 2. A. General Assessment (item 2e from page 2) | | | | | f/-:20-UJH | B. Less payment made with SIPC-6 filed (exclude interest)
Date Paid | | | | | | C. Less prior overpayment applied | | | | | | D. Assessment balance due or (overpayment) | | | | | | E. Interest computed on late payment (see instruction E) for ___ | | days at 20% per annum | | | | F. Total assessment balance and interest due (or overpayment carried forward) | | \$ _________ | _ | | G. PAYMENT: ✓ the box | /
Check mailed to P.O. Box IV" Funds Wired O
Total (must be same as F above) | ACH □
\$ ______ | 2 Lf ·, :\
0'-_~---- | | | H. Overpayment carried forward | | \$( ________ | _ | | | | | | | | | | | 3. Subsidiaries (S) and predecessors (P) included in this form (give name and 1934 Act registration number): | | | | | | | | | | | | | | | | and complete.
Daled the | The SIPC member submitting this form and the
person by whom it is executed represent thereby
that all information contained herein is true, correct
-;J#-;,y
~l).14V' •'
, 20.1/_.
o | | | -r V .
('
-X:!
I | | | ~
This form and the assessment payment is due 60 days after the end of the fiscal year. Retain the Working Copy of this form
for a period of not less than 6 years, the latest 2 years in an easily accessible place. | | (Title) | | | | | | | CJ=-o | | ffi Dates: | | | | | | 3::
11.U
> Calculations | Postmarked
Received | Reviewed
Documentation __
_ | | Forward Copy ___ | 1 **ui** Disposition of exceptions: {22}------------------------------------------------ # **DETERMINATION OF "SIPC NET OPERATING REVENUES" AND GENERAL ASSESSMENT** **Item No.** 2a. Total revenue (FOCUS Line 12/Part IIA Line 9, Code 4030) 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. - (3) Net loss from principal transactions in commodities in trading accounts. - (4) Interest and dividend expense deducted in determining item 2a. - (5) Net loss lrom management ol or participation in the underwriting or distribution of securities. - (6) Expenses other than advei:.4lsing, printing, registration fees and legal lees deducted in determining net profit from management of or participation in underwriting or distribution of securities. - (7) Net loss from securi1ies in investment accounts. Total additions #### 2c. Deductions: - (1) Revenues from the distribution of shares ol a registered open end investment company or unit investment trust, lrom the sale ot variable annuities, from the business ol insurance, from investment advisory services rendered to registered investment companies or insurance company separate accounts, and from transactions in security futures products. - (2) Revenues from commodity transactions. - (3) Commissions, floor brokerage and clearance paid to other SIPC members in connection with securities transactions. - (4) Reimbursements for postage In connection with proxy solicitation. - (5) Net gain from securities in investment accounts. - (6) 100% of commissions and markups earned from transactions in (i) certificates of deposit and (ii) Treasury bills, bankers acceptances or commercial paper that mature nine months or less from issuance date. - (7) Direct expenses ot printing advertising and legal fees incurred in connection with other revenue related to the securities business (revenue defined by Section 16(9)(l) of the Act). - (8) Other revenue not related either directly or indirectly to lhe securities business. (See Instruction C): (Deductions in excess of \$100,000 require documentation) - (9) (I) Total interest and dividend expense (FOCUS Line 22/PART IIA Line 13, Code 4075 plus line 2b(4) above) bul not in excess / ~*S* **5** ol total interest and dividend income. \$) - (ii) 40% of margin interest earned on customers securities accounts (40o/o of FOCUS line 5, Code 3960). Enter the greater of line (i) or (ii) Total deductions - 2d. SIPG Net Operating Revenues - 2e. General Assessment@ .0015 Amounts for the fiscal period beginning **1/1/2020** and ending **12/31/2020** Eliminate cents \$ If, I **17 3tf)** f 1 **1** \$. \_\_\_\_\_\_\_\_\_\_ \_ **'1** *I-f* ,,- ![](_page_22_Picture_35.jpeg) Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.