# GOVDESK, LLC X-17A-5 (2020-03-02) — Broker-dealer annual report - Company: GOVDESK, LLC - Form: X-17A-5 - Filed: 2020-03-02 - Period: 2019-12-31 - Accession: 0001050100-20-000002 - CIK: 1050100 - File #: 8-50628 - Material weakness: No - Auditor: Dave Banerjee CPA - Auditor location: Woodland Hills, CA - Contact: Mark T Manzo - Phone: 2015191905 - Signed by: Lawrence Pereira (Director) Original filing: https://www.sec.gov/Archives/edgar/data/1050100/000105010020000002/govdeskauditreptpubliced.pdf --- {0}------------------------------------------------ # Govdesk, LLC Statement of Financial Condition For the Year Ended Decemeber31, 2019 This report is deemed **PUBLIC** in accordance with Ru11 1 '1a-5 (e} under the Securities Exchange Act of 1934. A statement of financial condition bound separately has been filed with Securities & Exchange Commission shnultaneously herewith-as-a-CONFIDENTJ;.\tdo,ument {1}------------------------------------------------ Govdesk, LLC December 31, 2019 ## Table of Contents | Facing page and Oath or Affirmation Page | 1-2 | |---------------------------------------------------------|-----| | Report of Independent Registered Public Accounting Firm | 3 | | Financial Statements | | | Statement of Financial Condition | 4 | | Notes to the Financial Statements | 5·8 | {2}------------------------------------------------ ### **UNITEDSTATES SECURITIESANDEXCHANGECOMMISSION Washington, D.C. 20549** | 0MB APPROVAL | | |--------------------------|------------------------------| | 0MB Number: | 3235-0123 | | Expires: | August 31, 2020 | | Estimated average burden | | | | hours per response . 12. oo | SEC FILE NUMBER **B-50628** # **ANNUAL AUDITED REPORT FORM X~17A-5 PART Ill** **FACING PAGE** **Information Required of Brokers and Dealers Pursuant to Section** 17 of the **Securities Exchange Act of 1934 and Rule** 17a-5 **Thereunder** | | Securities Exchange Act of 1934 and Rule 17a-5 Thereunder | | | |------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------|---------------------|--------------------------------| | REPORT FOR THE PERIOD BEGINNINGQ1/01/19 | | AND ENDING 12/31/19 | | | | l'vfM/DD/YY | | ----------
MM/DD/YY | | A. | IDENTIFICATION
REGISTRANT | | | | NAME OF BROKER-DEALER: GOVDESK
LLC
, | | OFFICIAL USE ONLY | | | ADDRESS OF PRINCIPAL PLACE "OF BUSINESS: (Do not use P.O. Box No.) | | FIRM 1.D. NO. | | | 1801
S.
Catalina,
Suite#
305 | | | | | | (No. and Street) | | | | Redondo
Beach | California | | 90277 | | (City) | (State) | | (Zip Code) | | NAME AND TELEPHONE NUMBER OF PERSON TO CONTACT IN REGARD TO THIS REPORT
Lawrence Pereira (310) 373-2011 | | | | | | | | (Area Code - Telephone Number) | | | B. ACCOUNTANT
IDENTIFICATION | | | | INDEPENDENT PUBLIC ACCOUNTANT whose opinion is contained in this Report* | | | | | Dave
Banerjee
CPA | | | | | | (Name - if indi,ifdua/, state last, first, middle name) | | | | 21860
Suite#
Burbank
Blvd. | 150
Woodland
Hills | California | 91367 | | (Address) | (City) | (Stale) | (Zip Code) | | CHECK ONE: | | | | | I
certified Public Accountant
✓ | | | | | Public Accountant | | | | | | Accountant not resident in United States or any of its possessions. | | | | | FOR OFFICIAL USE ONLY | | | | | | | | *\*Claims for exemption from the requirement that the annual report be covered* by *the opinion of an independent public accountant must be supported* by *a statement of/acts and circumstances relied on as the basis for the exemption. See Section 240.l 7a-5(e)(2)* > Potential persons who are to respond to the collectlon of information contained in this form are not required to respond unless the form dis plays a ourrentlyvalid 0MB control number. SEC 1410 (06-02) {3}------------------------------------------------ #### **OATH OR AFFIRMATION** | L Lawrence Pereira | , swear (or affirm) that, to the best of | |--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------| | my knowledge and belief the accompanying
GOVDESK, LLC | financial statement and supporting
schedules pertaining to the firm of | | -----------------
of December 31 | -----------------------. as
. 20 19 | | neither the company nor any partner,
classified solely as that of a customer.
except as follows: | , are true and correct. I further swear (or affirm)
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proprietor, principnl officer or director
has any proprietary interest in any
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(a) Facing Page .
✓ (b) Statement of financial Condition.
(c) Statement of Income (Loss).
(d) Statement of Changes in Fitrnncial
Condition.
(e) Statement of Changes in Stockholders·
(() Statement of Changes in Liabilities
(g) Computation of Net Capital.
(h) C'ompumtion for Determination
(i) Information Relating to the Possession
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(i)
A Reconciliation, including appropriate
Computation for Determination | Equity or Partners' or Sole Proprietors·
Capita I.
Subordinmed to Claims of Creditors.
of Reserve Requirements Pursuant
to Rule l 5c3-3.
or Control Requirements Under Rule
I 5c3~3.
explanalion of the Computation of
Net Capital Under Rule I 5c3-I and the
of the Reserve Requirements Under
Exhibit A of Rule !ScJ-3. | | O
(k) A Reconciliation between the
consolida1ion.
(I) An Oath or Afftrmalion.
(111) A copy of the SIPC Supplemental
Report.
(n) A report describing any material
~ | audited and unaudited Statements
of Financial Condition with respecl
to methods of
·
inadequacies found to exist or found
to have existed since the date ofthe previous
audit. | | | | *\*\*For conditions of c01lfidenlial* 1reatme111 *of certain portions of this* j,l;11g, *see section 240.J 7a-5(eJ(3),* {4}------------------------------------------------ # CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT Anotary public or other o!licer completing this certificate verifies only the idcnlityol"the individual who signed the document, lo which this certificate is attached, and not the truthfulness, accuracy, or validity of that documenl. ## **State of California** } **County of Los Angeles** } On February 19, 2020, before me, YANLING CONDRON,Notary Public, personally appeared, **LAWRENCE PEREIRA** who proved to me on the basis of satisfactory evidence to be the person(§),whose name(s@are subscribed to the within instrument and acknowledged to me that~e/, he/they executed the same in Mer/their authorized capacity(ies), and that by his her/their signature(s) on the in'sfu.iment the person(s), or the entity upon behalf of whic the person(s) acted, executed the instrument. Icertify under PENAL TY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. ## **WITNESS MY HAND AND OFFICIAL SEAL.** ,~ **Name of Document: OATH OR AFFIRMATION** **My Commission Expire: January 25, 2023** ![](_page_4_Picture_10.jpeg) {5}------------------------------------------------ ## **DAVEBANERJEE,CPA** ![](_page_5_Picture_1.jpeg) *An Accountancy Corporation* - *Member AICPA and PCAOB* 21 860 Bwbank Blvd., Suite 150, Woodland Hills, CA 91367• (818) 65 7-0288• FAX (818) 657-0299• (818) 312-3283 ### **Report of Independent Registered Public Accounting Firm** To the Members of Govdesk, LLC. ### **Opinion on the Financial Statements** We have audited the accompanying balance sheet of Govdesk, LLC. {the "Company") as of December 31, 2019, 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 the Company as of December 31, 2019 in conformity with accounting principles generally accepted in the United States of America. ### **Basis for Opinion** These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted 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. In our opinion, the financial statements are fairly stated in all material respects. Dave Banerjee CPA, an Accountancy Corporation We have served as the Company's auditor since 2015. Woodland Hills, California February 20, 2020 {6}------------------------------------------------ ## GovdeskLLC ### Statement of Financial Condition December 31, 2019 | \$
27,323 | |---------------| | 11,859 | | 445 | | 50,000 | | 9,000 | | 11,218 | | 1,409 | | \$
111,254 | | | | | | \$
29,051 | | 45,595 | | 1,160 | | 75,806 | | 35,448 | | | **Total Liabilities and Members' Equity** \$ 111,254 See independent auditor's report and accompanying notes. {7}------------------------------------------------ #### 1. **Organization** Govdesk LLC (the "Company") was formed as a Limited Liability Company in California in September 1997, with a termination date of September 30, 2047. The Company registered as a broker-dealer with the Securities and Exchange Commission in August, 1998, and is a member of the Financial Industry Regulatory Authority. The Company engages in the brokerage of United States government securities, corporate bonds, and private placement of securities and related advisory services on afee basis. #### **2. Significant Accounting Policies** #### **Cash and Cash Equivalents** The Company considers all demand deposits held in banks and certain highly liquid investments with original maturities of three months or less, other than those held for sale in the ordinary course of business, to be cash equivalents. #### **Accounts Receivable** The Company considers accounts receivable to be fully collectible, and accordingly, no allowance for doubtful accounts has been provided. Management reviews accounts receivable and sets up an allowance for doubtful accounts when collection of a receivable becomes unlikely. #### **Furniture and Equipment** Furniture and equipment purchases greater than \$500 are valued *at* cost. Depreciation is being provided by the use of the straight-line method over estimated useful lives ranging from five to seven years. Total cost of furniture and equipment was \$37,388. Accumulated depreciation was \$35,980 and current depreciation expense amounts to \$4,733. #### **Trading Revenue** Corwnissions are related to securities transactions and are recorded on atrade date basis. The Company buys and sells securities on an agency basis on behalf ofits customers. Each time a customer enters into a buy or sell transaction, the Company charges a comrn~sion. 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 frnancial instrument or purchaser is identified, the pricing is agreed upon and the risks 8lld rewards of ownership have been transferred to/from the customer. The Company adopted Topic 606 "Revenue from Contracts with Customers" with a date of January I, 2019. As a result, it has changed its accounting policy for revenue recognition as detailed below. The Company applied Topic 606 using the cumulative effect method - i.e. by recognizing the cumulative effect of initially applying Topic 606 as an adjustment to the opening ·balance of equity at January 1, 2019. This was immaterial. Therefore, any prior reporting information has not been adjusted and continues to be reported under Topic 606. #### **Use of Estimates** The preparation of financial statements in accordance 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 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 and may have an impact on future periods. {8}------------------------------------------------ #### **Fair Value of Financial Instruments** Unless otherwise indicated, the fair values of all reported assets and liabilities that represent financial instruments (none of which are held for trading purposes) approximate the carrying values of such amounts. #### **Income Taxes** The Company, a limited liability company, has elected to be taxed asa partnership under the Internal Revenue Code and a similar state statute. In lieu of income taxes, the Company passes 100% of its taxable income and expenses to its members. Therefore, no provision or liability for federal or state income taxes is included in these fmancial statements. However, the Company is subject to the annual California LLC tax of \$800 and a California LLC fee based on gross income. The Company is no longer subject to examinations by major tax jurisdictions for years before 2015. #### **3. Fair Market Measurements** The Fair Value Measurements Topic of the FASB accounting standards codification establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level !measurements) and the lowest priority to measurements involving significant unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are as follows: | Level 1 | Quoted prices (unadjusted) in active markets for identical assets or liabilities that the
Company has the ability to access at the measurement date | |---------|--------------------------------------------------------------------------------------------------------------------------------------------------------| | Level 2 | Inputs other than quoted prices included within level 1 that are observable for the asset or liability,
either directly or indirectly | | Level 3 | Unobservable inputs for the asset or liability | #### **Determination of Fair Value** Under the Fair Value Measurements Topic of the FASB Accounting Standards Codification, the Company bases its fair value on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between participants at the measurement date. It is the company's policy to maximize the use of observable inputs and minimize the use ofunobservable inputs when developing fair value measurements, in accordance with the fair value hierarchy. Fair value measurements for assets and liabilities where there exists limited or no observable market data, and therefore, are based primarily upon management's own estimates, are often calculated based on current pricing policy, the economic and competitive environment, the characteristics oftheassets and liability and other such factors. Therefore, the results cannot be detennined with precision and may not be realized in an actual sale or immediate settlement of the asset or liability. Additionally, there may be inherent weaknesses in any calculation technique and changes in the underlying assumptions used, including discount rates and estimates of future cash flows, that could significantly affect the results of current or future value. The Company had no financial instruments to measure for fair value as of December 31, 2019. #### **4. Net Capital Requirements** The Company is subject to the Securities and Exchange Commission Uniform net capital rule (Rule l 5c3-1) which requires the maintenance of minimum net capital and requires that the ratio of aggregate indebtedness to net capital, both as defined, shall not exceed 15 to 1 At December 31, 2019, the Company had net capital of\$13,376 which was \$8,322 in excess of its required net capital of \$5,054. The Company's ratio of aggregate indebtedness to net capital was 5.67 to l. #### **5. Related Parties** The Company is affiliated with Seagate Global Advisors LLC ("Seagate Global"). {9}------------------------------------------------ Jeffery Matthews Financial is a broker-dealer and served as the Company's clearing broker where all customer transactions are cleared on afully disclosed basis. At December 31, 2019\$11,859 is due from Jeffery Matthews. During 2019, clearance fees totaling \$46,388 was paid to Jeffery Matthews. During 2019, the Company paid \$270,002 to King Harbor Wealth Management ("KHWM") for consulting services. KHWM is an entity which is wholly owned by Management of G\_ovdesk, LLC. #### 6. **Lease Obligation** The Company has a lease agreement for office space in Redondo Beach, California. The Company sub-leases office space on a month to month basis to an individual. On November 1, 2019, the Company signed aone-year lease extension which expires on October 31, 2020. Future minimum lease payments under the lease are: | Year | Amount | |-------------------|---------------| | 202-"--0
_____ | _ _=<,22=2=88 | | Total | \$22,288 | Rent Expense for the year ended December 31, 2019 was \$25,684. #### 7. **Financial Instruments with Off-Balance-Sheet Credit Risk** As a securities broker, the Company executes transactions with and on the behalf of customers. The Company introduces these transactions for clearance to a clearing fum on a fully disclosed basis. In the normal course of business, the Company's customer activities involve the execution of securities transactions and settlement by its clearing broker. The agreement between the Company and its clearing broker provides that the Company is obligated to assume any exposure related to nonperfonnance by its customers. These activities may expose the Company to off-balance-sheet risk in the event the customer is unable to fulfill its contracted obligations. In the event the customer fails to satisfy its obligations, the Company may be required to purchase or sell financial instruments at the prevailing market price in order to fulfill the customer's obligation. The Company seeks to control off-the-balance-sheet credit risk by monitoring its customer transaction and reviewing information it receives from its clearing broker on a daily basis and reserving for doubtful accounts when necessary. #### **8. Recent Accounting Pronouncements** ASC 606, Revenue from Contracts with Customers, was issued on May 28, 2014. ASC 606 provides guidance related to revenue from contracts with customers. Guidance applies to all entities and to all contracts with customers, with the exception of the following transactions noted in ASC 606-10: lease contracts, insurance contracts, financial instruments and other contractual rights or obligations, guarantees, nonmonetary exchanges between entities in the same line of business. For public business entities, certain not-for-profit entities, and certain employee plans, the effective date for ASC 606 is annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2017. Early application is permitted only as of annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2016. The effective date for all other entities is annual reporting periods beginning after December 15, 2018, and interim reporting periods within annual reporting periods beginning after December 15, 2018. {10}------------------------------------------------ #### 9. **Recent Accounting Pronouncements (Continue)** As of the reporting date the company has adopted the recently issued accounting standards, and there was no material affect on the financial statements. In February 2016, the FASB issued ASU No. 2016-02, "Lease (Topic 842)," which supersedes previous leasing guidance in Topic 840. Under the new guidance, lessees are required to recognize lease right-of-use assets and lease liabilities on the balance sheet for all leases with terms longer than 12 n1onths. Leases will be classified as either fmance or operating, with classification affecting the pattern of expense recognition in the income statement. The FASB has since issued additional related ASU amendments to clarify and improve certain aspects of the guidance and implementation of Topic 842. The company's lease obligation is less than 12 months. #### 10. **Subsequent Events** The Company has evaluated subsequent events through February 20, 2020, the date which the financial statements were available to be issued. Based upon the review, the Company had determined that there are no events which took place that would have a material impact on the financial statements, which would require disclosure. Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.