# ESSEX SECURITIES LLC X-17A-5 (2021-03-23) — Broker-dealer annual report - Company: ESSEX SECURITIES LLC - Form: X-17A-5 - Filed: 2021-03-23 - Period: 2020-12-31 - Accession: 0001075680-21-000005 - CIK: 1075680 - File #: 8-51472 - Material weakness: No - Auditor: Cree, Alessandri & Strauss, CPAs, P.C. - Auditor location: Wellesley HIlls, MA - Contact: Prakash Gupta - Phone: 201-777-7121 - Signed by: Prakash Gupta (CEO) Original filing: https://www.sec.gov/Archives/edgar/data/1075680/000107568021000005/EssexSecurities2020.pdf --- {0}------------------------------------------------ ### UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 | OMB APPROVAL | | | | | |-----------------------------|------------------|--|--|--| | OMB Number. | 3235-0123 | | | | | Expires: | October 31, 2023 | | | | | Estimated average burden | | | | | | Haurs per response
12.00 | | | | | | | | | | | ## ANNUAL AUDITED REPORT . ## FORM X-17A-5 PART III 8 51472 SEC FILE NUMBER ## 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 PERCOD BEGINNING | 01/01/2020
MM/DD/YY | AND ENDING | 16285 Parki
MMDD/VY | |--------------------------------------------------------------------------------------------------------------------|------------------------------|------------|-------------------------------| | | A. REGISTRANT IDENTIFICATION | | | | | | | | | NAME OF BROKER DEADERS | | | OFFICIAL USE ONLY | | Essex Securities LLC | | | FIRM L.D. NO. . | | ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use P.O. Box No.) | | | | | 95 Christopher Columbus Dr., Suite 16-11 | | | | | | (No. and Street) | | | | Jersey City | NAT | 07302 | | | (City) | (State) | (Zip Code) | | | NAME AND TELEPHONE NUMBER OF PERSON TO CONTACT IN REGARD TO THIS REPORT. | | | | | Prakash Gupta | | | 201-777-7121 | | | | | (Arm Code - Telephone Number) | | | B. ACCOUNTANT IDENTITCATION | | | | INDEPENDENT PUBLIC ACCOUNTANT whose opinion is contained in this Report®
Cree, Alessandri & Strauss, CPAs, P.C. | | | | | (Naxue - if individual, state last, first, middle name) | | | | | 20 Walnut Street | Wellesley Hills | MA | 02481 | | (Address) | (City) | (8) == ) | (Zip Cade) | | CHECK ONE: | | | | | Certified Public Accountant
× | | | | | Public Accountant | | | | | Accountant not resident in United States or any of its possessions. | | | | | | FOR OFF CIAL USE ONLY | | | | | | - 47 | | | | | | | | | | | | \*Claims for exemption from the requirement that the convered by the opinion of an independent public accountant must be supported by a statement of facts 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 valld OMB control number. SEC 1410 (06-02) {1}------------------------------------------------ ## OATH OR AFFIRMATION | Prakash Gupta
L | | | , swear (or affirm) that, to the best of | |---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--|------------------|---------------------------------------------------------------| | my knowledge and belief the accompanying financial statement and supporting schedules persaining to the firm of
Essex Securities LLC | | | a 125 | | of December 31 | | | , 20 20 are true and correct I further swear (or affirm) that | | neither the company nor any partner, principal officer or director has any propriesmy interest in any account | | | | | classified solely as that of a customer, except as follows: | | | | | None | | | | | | | | | | | | Signature | | | MARIA C BYRNE
- NOWN FORESTBLIC
STATE OF NEW JERSEY
This reperient contains (concer an applicable boxes | | (C) 9(0)
Time | | | & (a) Facing page. | | | | | 2 (b) Statement of Financial Condition. | | | | | J (c) Statement of Income (Loss). | | | | | (d) Statement of Changes in Financial Condition. | | | | | { (e) Statement of Changes in Stockholders' Equity or Partners' or Sole Proprietor's Capital.
[ (T) Statement of Changes in Liabilities Subordinated to Claims of Creditors. | | | | | Computation of Net Capital.
I (2) | | | | | (a) Computation for Determination of Reserve Requirements Pursuant to Rule 15c3-3. | | | | | (i) Information Relating to the Possession or Control Requirements under Rule 15c3-3. | | | | | (i) A Reconciliation, including appropriate explanation of Net Computation of Net Capital Under Rule 15c3-1 and | | | | | the Computation for Determination of the Reserve Requirements Under Exhibit A of Rule 15c3-3. | | | | | (k) A Reconciliation between the audited statements of Financial Condition with respect to methods of
consolidation. | | | | | An Oath or Affirmation.
× (1) | | | | | (m) A copy of the SIPC Supplemental Report. | | | | | (n) A report describing any material inadequacies found to have existed since the date of the
previous audit. | | | | . . \*\* For conditions of confidential treatment of certain portions of this filmg, see section 240.17a-5(e){3). {2}------------------------------------------------ # ESSEX SECURITIES, LLC FINANCIAL STATEMENTS & Supplementary Information DECEMBER 31, 2020 {3}------------------------------------------------ ## #### **-** | 3:HEJOVE;V-D9:H:D9:DOV3:<>NO:J:9V2P7A?8V'88EPDO>D



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Current liabilities | | | | Accounts payable and accrued expenses | S | 105,487 | | Total current liabilities | | 105,487 | | Members' equity | | | | Members' equity | | 701,930 | | Total members' equity | | 701,930 | | Total liabilities and member's equity | S | 807,417 | {6}------------------------------------------------ # Essex Securities, LLC Statement of Operations Year Ended December 31, 2020 | Revenues: | | | |----------------------------------------|---|-----------| | Commission income - clearing | S | 166,547 | | Commission income - other securities & | | | | insurance products | | 964,607 | | Other commission income | | 98,027 | | Reimbusred expense income | | 2,100 | | Interest income | | 2,165 | | Total revenue | | 1,233,446 | | Operating expenses: | | | | Commission expense and related costs | | 878,213 | | Professional fees | | 101,853 | | Clearing charges | | 51,864 | | Regulatory expense | | 31,097 | | Management fees | | 28,079 | | Advertising and promotion | | 24,082 | | Communications | | 20,245 | | Insurance | | 18,993 | | Compensation and benefits | | 16,261 | | Other operating expenses | | 12,849 | | Occupancy | | 3,562 | | Travel and entertainment | | 472 | | Bank charges | | 417 | | Total operating expenses | | 1,187,987 | | Net income from operations | S | 45,459 | {7}------------------------------------------------ # Essex Securities, LLC Statement of Changes in Members' Equity Year Ended December 31, 2020 | Balance, January 1, 2020, as reported | \$ 54,202 | |---------------------------------------|------------| | Member capital contribution | 602,269 | | Net income from operatoins | 45.459 | | Balance, December 31, 2020 | \$ 701,930 | {8}------------------------------------------------ # Essex Securities, Inc. Statement of Cash Flows Year Ended December 31, 2020 | Cash flows from operating activities: | | | |-------------------------------------------------------------------------------------|---|-----------| | Net income from operations | S | 45,459 | | Adjustments to reconcile net income to net | | | | cash provided/(used) by operating activities: | | | | (Increase) decrease in: | | | | Accounts receivable | | (129,968) | | Clearing deposit | | (25,000) | | Receivable from clearing brokers | | (13,511) | | Prepaid expenses | | (15,966) | | Security deposit | | (450) | | (Decrease) increase in | | | | Accrued expenses | | 85,481 | | Accounts payable and accrued expenses | | 12,184 | | Net cash used by operating activities | | (41,771) | | Cash flows from financing activities: | | | | Capital contribution | | 602,269 | | Net cash provided by financing activities | | 602,269 | | Net increase in cash and cash equivalents | | 560,498 | | Cash and cash equivalents, beginning of the year | | 19,061 | | Cash and cash equivalents, end of the year | S | 579,559 | | Supplemental disclosures of cash flow information
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Accordingly, no provision for income taxes has been recorded in the accompanying statement of operations for the year ended December 31, 2020. The partners for calendar year 2016 and prior are no longer subject to review by the taxing authorities. ## Furniture, Equipment, and Leasehold Improvements Acquisitions of property and equipment are stated at cost. Any expenditure for repairs, maintenance, renewals, and betterments that enhance the useful lives of the assets are capitalized and depreciated. Depreciation is provided based on accelerated and straight-line methods over the estimated useful lives of the assets. The estimated useful lives of furniture and equipment are 5 to 7 years for computers. ## NOTE 3 - Fair Value Measurements The "Fair Measurements and D isclosures" topic in the FASB Accounting Standards Codification establishes a framework for measuring fair value. That framework provides a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3), defines fair value, establishes a framework for measuring fair value, and establishes a fair value hierarchy which prioritizes the inputs to valuation techniques. FASB ASC 820 requires disclosures of the fair values of most financial instruments for which it is practicable to estimate that value. The scope of FASB ASC 820 excludes certain financial instruments such as trade receivables and payables when the carrying value approximates the fair value, employee benefit obligations and all nonfinancial instruments, such as fixed assets. The fair value of the Company's assets and liabilities which qualify as financial instruments under FASB ASC 820 approximate the carrying amounts presented in the Statement of Financial Condition. The three levels of the fair value hierarchy under FAS 157 and its applicability to the Company are described: - · Level 1 Pricing inputs are quoted prices available in active markets for identical assets or liabilities the Company has the ability to assess. As required by the FASB "Fair Value Measurements and Disclosures" topic, the Company does not adjust the quoted prices for these investments even in situations where the Company holds a large position and a sale could reasonably impact the quoted price. - · Level 2 Pricing inputs (other than quoted prices included within level 1) that are observable for the asset or liability, either directly for substantially the full term through corroborations with observable market data. Level 2 includes investments valued at quoted prices adjusted for legal or contractual restrictions specific to those investments. - · Level 3 Pricing inputs are unobservable inputs for the asset or liability and rely on management's own assumptions about the assumptions that market participants would use in pricing the asset or liability. Level 3 includes investments that are supported by little or no market activity. The Company did not have any assets or liabilities adjusted to fair value for the year ended December 31, 2020. {11}------------------------------------------------ ## Essex Securities, LLC Notes to Financial Statements December 31, 2020 ## NOTE 4 - DEPOSITS WITH CI FARING ORGANIZATIONS As required by its clearing organization, a deposit of \$50,000 exists at RBC Capital Markets LLC, as shown on the Statement of Financial Condition as of December 31, 2020. ## NOTE 5 - NET CAPITAL REQUIREMENTS The Company is subject to the Securities and Exchange Commission Uniform Net Capital Rule (Rule 15c3-1), which requires the maintenance of minimum net capital and requires that the ratio of aggregate indebtedness to netcapital, both as defined, shall not exceed 15 to 1. At December 31, 2020, the Company had net capital of \$580,582, which was \$573,550 in excess of its required net capital of \$7,032. The Company's ratio of aggregate indebtedness to net capital computed in accordance with Rule 15c3-1 was .18 to 1. The Company qualifies under the exemptive provisions of Rule 15c3-3 under Section (k)(2)(ii) of the Rule, as it does not carry security accounts of customers or perform custodial functions related to customer securities. ## NOTE 6-RELATED PARTY TRANSACTIONS While under the ownership of PHC, the Chief Operating Officer, Financial Operations Manager and other employees were on the payroll of Pinnacle Employee Service, LLC (PES). PES paid their salaries, payroll taxes and health insurance and the expenses are recorded as management fees on the Company's books. For the year ended December 31, 2020 the company paid \$28,079 in management fees. ## NOTE 7 - FACILITY LEASE The Company leased its premises under a six month lease that ends on March 31, 2021. Rent expense was \$3,562 for the year ended December 31, 2020. The future minimum rent due for the year ending December 31, 2021 is \$1,350. ## NOTE 8 - CONCENTRATIONS OF CREDIT RISK The Company is engaged in various trading and brokerage activities in which counterparties primarily include broker-dealers, banks, and other financial institutions. In the event counterparties do not fulfill their obligations, the Company may be exposed to risk. The risk of default depends on the creditworthiness of the counterparty or issuer of the instrument. It is the Company's policy to review, as necessary, the credit standing of each of the counterparties. The Company maintains its cash in bank accounts at high credit quality financial institutions. The balances at times may exceed federally insured limits. ### Note 9 - Commitments and Contingencies From time to time the Company is subject to threatened and asserted claims in the ordinary course of business. Because litigation and arbitration are subject to inherent uncertainties and the outcome of such matters cannot be predicted with certainty, future developments could cause any one or more of these matters to have a material impact on the Company's financial condition, results of operations or liquidity in any future period. ### Note 10 - Subsequent Events Management has evaluated events and transactions after the Statement of Financial Condition through March 17, 2021, which is the date the financial statements were available to be issued. {12}------------------------------------------------ ## Essex Securities, LLC Notes to Financial Statements December 31, 2020 ## Note 11 - Risks and Uncertainties In March 2020, the World Health Organization (WHO) declared COVID-19 a global pandemic. This pandemic event has resulted in significant business disruptions and uncertainty in both global and U.S. markets. While management believes the Company is in an appropriate position to weather the potential short-term effects of these world-wide events, the direct and long-term impact to the Company and its financial statements is undetermined at this time. {13}------------------------------------------------ #### **- "" "" " "--""" "" !""""-"** #### **-** | +7NW"3H=N3BW
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)>34>B>N>7MW | | W | | /3N>FWF8W3::K7:3N7W>E674NE7MMWNFWD7NW53H?N3BW | 0-W | | | | | | /75FD5>B>3N?FEWT?N;W"FCH3EVMW5FCHQN3N>FEW>D5BR676W ?DWH3LW''WF8W8GKCW2 W!W3MWF8W#757C47KWWW > 1<7K7W3K7WDFWC3N7K>3BW6?97K7D57MW47NT77DWN;7W5FCHQN3N>FEMW34FS7 3D6WN;7W5FCHQN3N>FDMW>E5BQ676W?DWN;7W"FCH3DV-MW5FKK7MHFE6?E:W QD3R6?N76W%FKCW2!W.3KPBB!W8>B>E:W {14}------------------------------------------------ # Essex Securities, Inc. Supplemental Schedule for: Computation for Determination of Reserve Requirement & Information Relating to the Possession or Control Requirements ## December 31, 2020 The Company is exempt from the provisions of Rule 15c3-3 under Securities Exchange Act of 1934 pursuant to subparagraph (k)(2)(ii) of Rule 15c3-3 as all customer transactions are cleared through RBC Capital Markets LLC on a fully disclosed basis. Therefore, the following reports are not presented: - A. Computation for Determination of Reserve Requirement under Rule 15c3-3 - B. Information Relating to the Possession or Control Requirements under Rule 15c3-3 {15}------------------------------------------------ ### **+,/#"&/"/ # (/'(%/)/ "\* ( /%/ %\$)%/./ /\*/ /"%//%"% %/ /!/-#(" /%"/ /)/-/** ;W+j6CR@C\ajWDj 0aaCgj:CAd\KbKCaj55.j =Cj I>eCj\CeKCfCBj S>U>HCRCUbajab>bCRCUbj KUAPdBCBj LUjbICj>AAWRZ>UhKUHj 2LU>UAK>Pj >UBj7ZC\>bKWU>Qj.WR@KUCBj\cj34,j1gCRZbKeCj8\_eLaLWUjdUBC\j 9dPCj#'A%%jLUjfILAIj #j1aaCgj:CAd\LbKCaj 55.jKBCUbLELCBjbICjEXQPWfKUHjZ\WeKaLWUajWEj#(j .29 j i#'A%% OjdUBC\jfIKAJj1aaCgj:CAd\KbLCaj 55.jAQ>KRCBj >Uj CgCTZbKWUjE\WRj#) .29!j i\$&"#'A%%j O j \$ j KL j CgCRZbKWUj Z\_eKaKWUaj >UBj \$ j 1aaCgj :CAd]KbKCaj 55. ab>bCBjbI>bj1aaCgj:CAd]KbKCaj 55.jRCbjbICjKBCUbLFCBjCgCRZbLWUjZ\WeKaLWUajbI\YdHIWdbjbIC RWabj\CACUbjhC>\jCUBCBj /CACR@C\j%#j\$"\$"jfKbIWdbjCgACZbLWUj 0aaCgj:CAd\LbKCaj55.a R>U>HCRCUbj Laj \CaZWUaK@PCj G\j AWRZPK>UACj fLbIj bICj CgCRZbKWUj Z\_eKaKWUaj >UBj Lba ab>bCRCUba 7d\j \CeLCfj f>aj AWUBdAbCBj LUj >AAW\B>UACjfLbIj bICj ab>UB>\Baj WEj bICj 8d@QLAj .WRZ>Uhj ,AAWdUbLUHj 7eC\aKHIbj -W>\Bj bCaj >UBj >AAW\BLUHPhj LUAPdBCBj KU[dL\LCaj >UBj WbIC\j\C[dL\CBjZ\_ACBd\CajbWjW@b>LUjCeLBCUACj>@Wdbj1aaCgj:CAd\LbLCaj55.ajAWRZPK>UACj fLbIj bICj CgCRZbKWUj Z\WeKaKWVaj ,j \CeMCfj Kaj ad@ab>UbL>PQhj QCaaj LUj aAWZCj bI>Uj >Uj Cg>TKU>bLWUj bICjW@NCAbKeCj WEjfIKAIj MajbICj CgZ\CaaKWUj WEj>Uj WZKUKWUj WUjR>U>HCRCUbaj ab>bCRCUbaj ,AAW\BLUHQhjfCjBWjUWbjCgZ\CaajadAIj>UjWZLULWUj ->aCBjWUjWd\j\CeKCfjfCj>\CjUWbj>f>\CjWEj>UhjT>bC\K>QjRWBLEKA>bKWUajbI>bjaIWdQBj@CjR>BCj bWjR>U>HCRCUbajab>bCTCUbaj\CEC\\CBjbWj>@WeCjG\jbICRjbWj@CjE?K\Phjab>bCBjKUj>QPjR>bC\K>Qj \CaZCAbaj@>aCBjWUjbICjAWUBLbKWUajaCbjG`IjKUj O \$ LKjWEj9dPCj#'A%%jdUBC\jbICj:CAd\KbKCaj 1gAI>UHCj,AbjWEj#\*%&j .\CCj,QCaa>UB\Kjj:b^>daaj.8,aj55.j 6>\AIj#)j\$"\$#j {16}------------------------------------------------ Essex Securities LLC Exemption Report December 31, 2020 Essex Securities LLC (the "Company") is a registered broker-dealer subject to Rule 17a-5 promulgated by the Securities and Exchange Commission (17 C.F.R. §240.17a-5, "Reports to be made by certain brokers and dealers"). This Exemption Report was prepared as required by 17 C.F.R. § 240.17a-5(d)(1) and (4). To the best of its knowledge and belief, the Company states the following: - (1) The Company claims an exemption from 17 C.F.R. § 240.15c3-3 under the following provisions of 17 C.F.R. § 240.15c3-3 section k(2)(ii). - (2) The Company met the identified exemption provisions in 17 C.F.R. § 240.15c3-3 (k)(2)(i) throughout the most recent fiscal without exception. Essex Securities LLC I, Prakash Gupta, swear (or affirm) that, to my best knowledge and belief, this Exemption Report is true and correct. By: PRAKASH GUPTA Title: CEO Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.