# CAPFINANCIAL SECURITIES, LLC. X-17A-5 (2021-03-01) — Broker-dealer annual report - Company: CAPFINANCIAL SECURITIES, LLC. - Form: X-17A-5 - Filed: 2021-03-01 - Period: 2020-12-31 - Accession: 0001062993-21-002061 - CIK: 1224260 - File #: 8-65870 - Material weakness: No - Auditor: Batchelor Tillery & Roberts, LLP - Auditor location: Raleigh, NC - Contact: Denise Buchanan - Phone: 919-870-6822 - Signed by: Denise Buchanan (Chief Compliance Officer) Original filing: https://www.sec.gov/Archives/edgar/data/1224260/000106299321002061/capfinancial2.pdf --- {0}------------------------------------------------ CapFinancial Securities, LLC (A Wholly-Owned Subsidiary of The CapFinancial Group, LLC) Financial Statements and Supplemental Information December 31, 2020 (With Accountants' Report Thereon) {1}------------------------------------------------ **UNITEDSTATES SECURITIESANDEXCHANGECOMMISSION Washington, D.C. 20549** OMB APPROVAL 0MB Number: 3235-0123 Expires: October 31, 2023 Estimated average burden # hours per response 12.00 **ANNUAL AUDITED REPORT FORM X-17A-5 PART III** SEC FILE NUMBER B- 65870 **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
PERIOD
FOR THE | BEGINNING | 01/01/2020 | | 12/31/2020
AND ENDING | | |----------------------------------------------------------------------------------------------|------------------|----------------------------|----------------------------------------------|-----------------------------------|--| | | | MM/DD/YY | | MM/DD/YY | | | | A.
REGISTRANT | | IDENTIFICATION | | | | OF BROKER-DEALER:
NAME | CapFinancial | Securities,
LLC | | OFFICIAL USE ONLY | | | BUSINESS:
use P.O.
No.)
ADDRESS OF
PLACE
OF
(Do
not
Box
PRINCIPAL | | | FIRM I.D.
NO. | | | | Forks
Road,
Suite
4208
Six | 1700 | | | | | | | | (No.
and Street) | | | | | Raleigh | | NC | | 27609 | | | (City) | | (State) | | (Zip Code) | | | NAME AND TELEPHONE
NUMBER
Denise Buchanan | OF
PERSON | TO
CONTACT | TO
IN REGARD
THIS
REPORT | 919 870 6822 | | | | | | | (Area Code -
Telephone Number) | | | | B.
ACCOUNTANT | | IDENTIFICATION | | | | | | | in this
Report* | | | | INDEPENDENT
PUBLIC
ACCOUNTANT | whose | opinion
is
contained | | | | | Batchelor
Tillery
&
Roberts, | LLP | | | | | | | (Name -if | | individual, state last, first, middle name ) | | | | 3605
Glenwood
Avenue, | Suite
350 | Raleigh | NC | 27612 | | | (Address) | | (City) | (State) | (Zip Code) | | | CHECK ONE: | | | | | | | /
Certified
Public | Accountant | | | | | | Public
Accountant | | | | | | | Accountant
not resident | in United | States
or
any
of | its possessions. | | | | | FOR | USE
OFFICIAL | 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 offacts 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** SEC 1410 (11-05) **unless theform displays a currently valid OMB control number.** {2}------------------------------------------------ #### **OATH OR AFFIRMATION** # I Denise Buchanan , swear (or affirm) that, to the best of my knowledge and belief the accompanying financial statement and supporting schedules pertaining to the firm of CapFinancial Securities, LLC , as , are true and correct. I further swear (or affirm) that 0f December 31 , **2020** 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: --a / ' f A*z»* This report \*\* contains (check all applicable boxes): - **ZJ** (a) Facing Page. - *V]* (b) Statement of Financial Condition. - /] (c) Statement of Income (Loss) or, if there is other comprehensive income in the period(s) presented, a Statement of Comprehensive Income (as defined in §210.1-02 of Regulation S-X). - 7] (d) Statement of Changes in Financial Condition. - / (e) Statement of Changes in Stockholders' Equity or Partners' or Sole Proprietors' Capital. - \_J (0 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. - ZJ (i) Information Relating to the Possession or Control Requirements Under Rule 15c3-3. - Z1 0) 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 15c3-3. - I (k) A Reconciliation between the audited and unaudited Statements of Financial Condition with respect to methods of consolidation. - / (1) An Oath or Affirmation. - / (m) A copy of the SIPC Supplemental Report. - (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).* {3}------------------------------------------------ # **BATCHELOR, TILLERY & ROBERTS, LLP** CERTIFIED PUBLIC ACCOUNTANTS POST OFFICE BOX 18068 RALEIGH) NORTH CAROLINA 27619 RONALD A. BATCHELOR ANN H. TILLERY FRANKLIN T. ROBERTS WM. JAMES BLACK, JR. SCOTT E. CABANISS MICHELLE W. LEMANSKI JARED L. PILAND DAVID C. CORN, JR. 3605 GLENWOOD AVENUE, SUITE 350 RALEIGH, NORTH CAROLINA 27612 TELEPHONE (919) 787-8212 FACSIMILE (919) 783 -6724 ## **Report of Independent Registered Public Accounting Firm** The Board of Directors CapFinancial Securities, LLC: #### **Opinion on the Financial Statements** We have audited the accompanying balance sheet of CapFinancial Securities, LLC (the "Company", a wholly-owned subsidiary of The CapFinancial Group, LLC) as of December 31, 2020, and the related statements of income and member's capital, 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 the Company as of December 31, 2020, and the results of its operations and its cash flows for the year then ended in conformity with accounting principles generally accepted in the United States of America. #### **Basis for Opinion** These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits 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 audits 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. {4}------------------------------------------------ ## **Auditors' Report on Supplemental Information** The supplemental information in schedules 1-4 has been subjected to audit procedures performed in conjunction with the audit of Company's financial statements. The supplemental information is the responsibility of the Company's management. Our audit procedures included determining whether the supplemental information reconciles to the financial statements or the underlying accounting and other records, as applicable, and performing procedures to test the completeness and accuracy of the information presented in the supplemental information. In forming our opinion on the supplemental information, we evaluated whether the supplemental information, including its form and content, is presented in conformity with 17 C.F.R. §240.17a-5. In our opinion, the supplemental information is fairly stated, in all material respects, in relation to the financial statements as a whole. We have served as the Company's auditor since 2015. Raleigh, North Carolina February 24, 2021 {5}------------------------------------------------ #### Balance Sheet ## December 31, 2020 | Assets | 2020 | |--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------| | assets:
Current
Cash
and
cash
equivalents
-
Accounts
receivable
related
party
Prepaid
expenses
current
Total
assets | \$
1,681,464
3,373
96,436
1,781,273 | | | \$
1,781,273 | | Liabilities
and
Member's
Capital | | | liabilities:
Current
payable
Accounts
payable
Accounts
-
related
party
Accrued
expenses
compensation
Deferred
current
Total
liabilities | \$
3,506
126,652
30,101
101,287
261,546 | | Member's
capital | 1,519,727 | | | \$
1,781,273 | See accompanying notes and auditors' opinion. {6}------------------------------------------------ ## Statement of Income and Member's Capital ### Year ended December 31, 2020 | Revenues: | 2020 | |--------------------------------------------------------------------------------------------------------|------------------| | | | | Commissions
exchange
on
listed
securities
exchanges | | | executed
on | \$
1 ,316,172 | | supervision,
Fees
for
account
investment
administrative
services
advisory,
and | 1 ,382,654 | | Other
operating
revenue | 29,949 | | | 2,728,775 | | Operating
expenses: | | | Compensation | 109,351 | | Expense
sharing
services | 1,855,587 | | Registration
and
fees | 220,075 | | Taxes
and
licenses | 4,015 | | Miscellaneous | 48,298 | | | 2,237,326 | | | | | Operating
income | 491,449 | | Other
income: | | | Other
income | 375 | | Total
other
income | 375 | | Net
income | 491,824 | | | | | capital,
Member's
beginning
of
year | 1,027,903 | | | \$
1,519,727 | | capital,
Member's
of
end
year | | See accompanying notes and auditors' opinion. {7}------------------------------------------------ #### Statement of Cash Flows ## Year ended December 31, 2020 | | 2020 | |-----------------------------------------------------------------|-----------------| | Cash
flows
from
operating
activities: | | | Net
income | \$
491,824 | | Adjustments
to
reconcile
net
income | | | to
net
cash
provided
operating
activities:
by | | | Changes
operating
in
assets
and
liabilities: | | | Accounts
receivable
other
- | 5,566 | | receivable
Accounts
related
party
- | 8,339 | | Prepaid
expenses | (13,499) | | Accounts
payable | 3,346 | | -
Accounts
payable
related
party | (35,177) | | Accrued
expenses | 12,780 | | Deferred
compensation | 101,287 | | Net
cash
provided
operating
by
activities | 574,466 | | Net
increase
cash
and
cash
equivalents
in | 574,466 | | Cash
cash
equivalents,
beginning
year
and
of | 1,106,998 | | equivalents,
year
Cash
and
cash
end
of | \$
1,681,464 | **See accompanying notes and auditors' opinion.** {8}------------------------------------------------ ### Notes to Financial Statements ## December 31, 2020 ## (1) Organization and Significant Accounting Policies The Company was formed as CapFinancial Securities, LLC, (the "Company"), a North Carolina limited liability company, on November 21, 2013. The Company operates in North Carolina and as of December 31, 2020 is authorized as a foreign LLC in 34 other states plus Washington, DC. The Company is a wholly-owned subsidiary of The CapFinancial Group, LLC ("Group" or "Parent"), who is a successor by merger to The CapFinancial Group, Inc., and is a broker-dealer in securities registered in 50 states plus Washington, DC, and is a member of the Financial Industry Regulatory Authority, Inc. ("FINRA"). The Company's securities are cleared through a clearing broker-dealer. The Company does not maintain customers' security accounts nor does it perform custodial functions related to customer securities. On January 1, 2015, the Company succeeded the broker/dealer operations of CapFinancial Partners, LLC ("Partners"), also a majority-owned subsidiary of Group. Until December 31, 2014, Partners, doing business as CAPTRUST Financial Advisors, was registered as an investment advisor under the Investment Advisers Act of 1940 and as a broker/dealer under the Securities Exchange Act of 1934 (as a "dual registrant"). Due to a corporate restructuring, on January 1, 2015, the Company succeeded the broker/dealer business of Partners upon a "succession by amendment" filing. ## Basis of Presentation The Company's policy is to prepare its financial statements in accordance with accounting principles generally accepted in the United States of America. ## Cash and Cash Equivalents For purposes of the financial statements, cash and cash equivalents include cash, deposits in interestbearing accounts, and other financial instruments with original maturities of less than three months. #### Revenue Recognition The Company's revenue is recognized based on contracts with clients. The Company generally recognizes revenue pursuant to the terms of its investment advisory agreements or portfolio management account agreements on a quarterly basis at the beginning of each calendar quarter and such revenue is amortized over the quarter as the performance obligation is satisfied. Some revenue is invoiced and recognized on a monthly basis. Revenue related to commissions, money market interest and securities transactions are recognized as revenue as services are provided, which are simultaneously received and consumed by the client. {9}------------------------------------------------ ## Notes to Financial Statements, Continued ## December 31, 2020 # (1) Organization and Significant Accounting Policies, Continued ## Accounts Receivable Accounts receivable are recorded at net realizable value consisting of the carrying amount less the allowance for doubtful accounts. Accounts receivables are considered past due based on contractual terms. Uncollectible accounts are charged off when all reasonable efforts to collect the accounts have been exhausted. The Company performs ongoing credit evaluations of its customers and generally does not require collateral. Although the Company does not currently foresee a credit risk associated with these receivables, repayment is dependent on the financial stability of the companies involved. The Company provides an allowance for doubtful receivables in amounts equal to the estimated collection losses that will be incurred. The allowance for doubtful accounts as of December 31, 2020 was \$0. ## Income Taxes The Company is treated as a disregarded entity for income tax purposes and its parent entity, Group, is taxed as a partnership under the Internal Revenue Code whereby its income is taxed to its members. Therefore, there is no provision for income taxes for the Company. Management does not believe the financial statements include any significant uncertain tax positions. Tax years ending December 31, 2018 through December 31, 2020 remain open for examination by taxing authorities as of the date of this report. ## Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates due to risks and uncertainties, including uncertainty in the current economic environment due to the outbreak of a novel strain of coronavirus. ## Concentrations of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and cash equivalents and accounts receivable. Cash and cash equivalents are maintained at financial institutions and, at times, balances may exceed federally insured limits. Accounts are insured by the Federal Deposit Insurance Corporation up to at \$250,000 at each financial institution. The Company's uninsured cash balance was \$1,241,300 at December 31, 2020. {10}------------------------------------------------ # Notes to Financial Statements, Continued ## December 31, 2020 ## (2) Revenue Recognition All revenue recognized on the Statement of Income is considered to be revenue from contracts with customers. The following table disaggregates the Company's revenue based on the timing of satisfaction of performance obligations for the year ended December 31, 2020. | Performance
obligations
satisfied
over
time | \$
1 ,982,285 | |------------------------------------------------------------------------|------------------| | obligations
Performance
satisfied
at
a
point
in time | 746,490 | | Total
Revenue | \$
2,728.775 | The following table depicts the disaggregation of the various types of revenue generated by the Company: | Rule
12b-l
service
distribution
fees
and | 1,352,776
\$ | |--------------------------------------------------------------------|-----------------| | Sales
commissions
on
variable
annuity
sales | 629,509 | | on
non-qualified
Renewal
premium
variable
insurance | 746,490 | | Total
Revenue | 2.728.775
\$ | (3) Net Capital Requirements The Company is subject to the Securities and Exchange Commission Uniform Net Capital Rule (Rule 15c3-l), which requires the maintenance of minimum net capital. The Company has elected to use the basic method, permitted by the Rule, which requires that the Company maintain minimum net capital of \$250,000, as defined, and requires that the ratio of aggregate indebtedness to net capital, both as defined, shall not exceed 15 to 1. As of December 31, 2020, the Company had net capital of \$1,419,918, which was \$1,169,918 in excess of required net capital, and its ratio of aggregate indebtedness to net capital was .18 to 1. (4) Related Parties Effective January 1, 2015, the Company entered into an amended and restated expense sharing agreement with Partners. The agreement requires the Company to make payments to Partners to cover the cost of shared services. During the year ended December 31, 2020, the Company's portion of the shared services expenses totaled \$1,855,587 under this agreement. As of December 31, 2020, the net amount due to Partners totaled \$126,652. In addition, the Company incurs certain clearing/execution fees that are passed along to Partners. These fees were netted against clearing/execution fees in the accompanying statement of income and member's capital. As of December 31, 2020, the net amount due from Partners totaled \$3,373. {11}------------------------------------------------ #### Notes to Financial Statements, Continued #### December 31, 2020 #### (5) Subsequent Events The date to which events occurring after December 31, 2020, the date of the most recent balance sheet, have been evaluated for possible adjustment to the financial statements or disclosure is February 24, 2021 the date the financial statements were available to be issued. {12}------------------------------------------------ #### **SUPPLEMENTAL SCHEDULES** {13}------------------------------------------------ #### Supplemental Schedule of Changes in Member's Capital ### Year ended December 31, 2020 | Balance,
31,
December
2019 | \$
1,027,903 | |-------------------------------------|-----------------| | Net
2020
income
for | 491,824 | | Balance,
31,
December
2020 | \$
1,519,727 | See accompanying notes and auditors' opinion. {14}------------------------------------------------ ## Supplemental Schedule of Computation and Reconciliation of Net Capital in Accordance with Rule 15c3-1 of the Securities and Exchange Commission ### December 31, 2020 | capital:
Net | | |-------------------------------------------------------------------------|-----------------| | member's
Total
equity | \$
1,519,727 | | Deduct:
Non-allowable
assets
Deduct:
Securities
haircuts | (99,809) | | | | | Net
capital | \$
1,419,918 | | indebtedness:
Aggregate | | | Accounts
payable | \$
3,506 | | Accounts
payable
-
related
party | 126,652 | | expenses
Accrued | 30,101 | | Deferred
compensation | 101,287 | | Total | \$
261,546 | | requirements:
Net
capital | | | Broker-dealer | \$
250,000 | | excess
of
Net
capital
requirements
in | 1,169,918 | | Net
capital
as
computed
above | \$
1,419,918 | | Ratio
of
aggregate
to
indebtedness
net
capital | .18
to
1 | There are no material differences between the preceding computation and the Company's corresponding unaudited Part II of Form X-17A-5 as of December 31, 2020. {15}------------------------------------------------ ## Supplemental Schedule of Computation for Determination of Reserve Requirements Pursuant to Rule 15c3-3 of the Securities and Exchange Commission December 31, 2020 The Company is exempt from the provisions of Rule 15c3~3 under the Securities Exchange Act of 1934, in that the Company's activities are limited to those set forth in the conditions for exemption appearing in paragraph (k)(2)(ii) of the Rule. See accompanying notes and auditors' opinion. {16}------------------------------------------------ ## Supplemental Schedule of Information for Possession or Control Requirements Under Rule 15c3-3 of the Securities and Exchange Commission December 31, 2020 The Company is exempt from the provisions of Rule 15c3-3 under the Securities Exchange Act of 1934, in that the Company's activities are limited to those set forth in the conditions for exemption appearing in paragraph (k)(2)(ii) of the Rule. # **See accompanying notes and auditors opinion.** {17}------------------------------------------------ # **BATCHELOR, TILLERY & ROBERTS, LLP** CERTIFIED PUBLIC ACCOUNTANTS POST OFFICE BOX 18068 RALEIGH, NORTH CAROLINA 27619 RONALD A. BATCHELOR ANN H. TILLERY FRANKLIN T. ROBERTS WM. JAMES BLACK, JR. SCOTT E. CABANISS MICHELLE W. LEMANSKI JARED L. PILAND DAVID C. CORN, JR. 3605 GLENWOOD AVENUE, SUITE 350 RALEIGH, NORTH CAROLINA 27612 TELEPHONE (919) 787-8212 FACSIMILE (919) 783-6724 # REPORT OF INDEPENDENT REGISTERED ACCOUNTING FIRM ON APPLYING AGREED-UPON PROCEDURES The Board of Directors CapFinancial Securities, LLC: 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 (SIPC) Series 600 Rules, which are enumerated below and were agreed to by CapFinancial Securities, LLC and SIPC, solely to assist you and SIPC in evaluating CapFinancial Securities, LLC's compliance with the applicable instructions of the General Assessment Reconciliation (Form SIPC-7) for the year ended December 31, 2020. CapFinancial Securities, LLC'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: - Compared the listed assessment payments in Form SIPC-7 with respective cash disbursement records entries, noting no differences; 1. - Compared the Total Revenue amount reported on the Annual Audited Report Form X-17A-5 Part III for the year ended December 31, 2020 with the Total Revenue amount reported in Form SIPC-7 for the year ended December 31, 2020, noting no differences; 2**.** - Compared any adjustments reported in Form SIPC-7 with supporting schedules and working papers, noting no differences; 3. - 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; and 4. - 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. 5. {18}------------------------------------------------ The Board of Directors Page 2 We were not engaged to, and did not conduct an examination, the objective of which would be the expression of an opinion on compliance. Accordingly, we do not express such an opinion. 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 information and use of the specified parties listed above and is not intended to be and should not be used by anyone other than these specified parties. February 24, 2021 {19}------------------------------------------------ #### CAPFINANCIAL SECURITIES, LLC #### Schedule of Assessment and Payments #### Year ended December 31, 2020 | Assessment for December 31, 2020 | \$
2,075 | |----------------------------------|-------------| | Less: | | | Paid October 22, 2020 | (1,141) | | Paid February 22, 2021 | (934) | | Assessment due March 1, 2021 | \$
NONE | {20}------------------------------------------------ # **BATCHELOR, TILLERY & KOBERTS, LLP** CERTIFIED PUBLIC ACCOUNTANTS POST OFFICE BOX 18068 RALEIGH) NORTH CAROLINA 27619 RONALD A. BATCHELOR ANN H. TILLERY FRANKLIN T. ROBERTS WM. JAMES BLACK, JR. SCOTT E. CABANISS MICHELLE W. LEMANSKI JARED L. PILAND DAVID C. CORN, JR. 3605 GLENWOOD AVENUE, SUITE 350 RALEIGH, NORTH CAROLINA 27612 TELEPHONE (919) 787-8212 FACSIMILE (919) 783-6724 # **Report of Independent Registered Public Accounting Firm** The Board of Directors CapFinancial Securities, LLC: We have reviewed management's statements, included in the accompanying Exemption Report, in which (1) CapFinancial Securities, LLC (the "Company") identified the following provisions of 17 C.F.R. § 15c3-3(k) under which the Company claimed exemption from 17 C.F.R. § 240.15c3-3: (2)(ii) (exemption provisions), and (2) the Company stated that the Company met the identified exemption provisions throughout the most recent fiscal year without exception. The Company's management is responsible for compliance with the exemption provisions and its statements. Our review was conducted in accordance with the standards of the Public Company Accounting Oversight Board (United States) and, accordingly, included inquiries and other required procedures to obtain evidence about the Company's compliance with the exemption provisions. A review is substantially less in scope than an examination, the objective of which is the expression of an opinion on management's statements. Accordingly, we do not express such an opinion. Based on our review, we are not aware of any material modifications that should be made to management's statements referred to above for them to be fairly stated, in all material respects, based on the provisions set forth in paragraph (k)(2)(ii) of Rule 15c3-3 under the Securities Exchange Act of 1934. *d* **3 I** *)* Raleigh, North Carolina February 24, 2021 {21}------------------------------------------------ # **EXEMPTION STATEMENT** CapFinancial Securities, LLC ("Company") is a registered broker-dealer subject to SEC Rule 17a-5 ("Reports to be made by certain brokers and dealers"). This Exemption Report was prepared as required by Rule 17a-5(d)(l) and (4). To the best of its knowledge and belief, the Company states the following: CapFinancial Securities, LLC claims an exemption from SEC Rule 15c3-3, during the year ended December 31, 2020, pursuant to paragraph k(2)(ii). CapFinancial Securities, LLC met the identified exemption provisions throughout the year ended December 31, 2020 without exception. *I* Denise Buchanan, CCO / Date Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.