# KOPENTECH CAPITAL MARKETS LLC X-17A-5 (2024-03-18) — Broker-dealer annual report - Company: KOPENTECH CAPITAL MARKETS LLC - Form: X-17A-5 - Filed: 2024-03-18 - Period: 2023-12-31 - Accession: 0001091484-24-000004 - CIK: 1772945 - File #: 8-70331 - Type: Broker-dealer - Material weakness: No - Auditor: Weisberg, Mole', Krantz & Goldfarb, LLP - Auditor location: Woodbury, NY - Contact: Anthony Schexnayder - Phone: 800 862 1684 - Email: anthony@kopentech.com - Website: kopentech.com - Signed by: Anthony Schexnayder (Chief Executive Officer) Original filing: https://www.sec.gov/Archives/edgar/data/1772945/000109148424000004/kcmpublic.pdf --- {0}------------------------------------------------ #### STATEMENT OF FINANCIAL CONDITION DECEMBER 31, 2023 (With Report of Independent Registered Public Accounting Firm Thereon) {1}------------------------------------------------ UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 0MB APPROVAL 0MB Number: 3235-0123 Expires: Nov. 30, 2026 Estimated average burden hours per response: 12 ## **ANNUAL REPORTS FORM X-17A-5 PART** Ill | SEC FILE NUMBER | |-----------------| | | 8-70331 FACING PAGE Information Required Pursuant to Rules 17a-5, 17a-12, and 18a-7 under the Securities Exchange Act of 1934 FILING FOR THE PERIOD BEGINNING **01/01/2023** AND ENDING **12/31/2023** MM/DD/YY MM/DD/YY **A. REGISTRANT IDENTIFICATION** # NAME oF FIRM: **\_K\_o\_,p'--e\_n\_t\_e\_ch\_C\_a...:.\_p\_it\_a\_l \_M\_a\_rk\_e\_t\_s\_L\_L\_C \_\_\_\_\_\_\_\_ \_** TYPE OF REGISTRANT (check all applicable boxes): 0 Broker-dealer D Security-based swap dealer D Major security-based swap participant □ Check here if respondent is also an OTC derivatives dealer ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use a P.O. box no.) ## **10880 Wilshire Blvd, Suite 1101** | | (No. and Street) | | | | |---------------------------------------------------------------------------|------------------------------------------------------------------------|-----------------------|-----------------|--| | Los Angeles | CA | | 90024 | | | (City) | (State) | | | | | PERSON TO CONTACT WITH REGARD TO THIS FILING | | | | | | Anthony Schexnayder | 800 862 1684 | anthony@kopentech.com | | | | (Name) | (Area Code-Telephone Number) | | (Email Address) | | | | B. ACCOUNTANT IDENTIFICATION | | | | | INDEPENDENT PUBLIC ACCOUNTANT whose reports are contained in this filing* | | | | | | | Weisberg, Mole', Krantz & Goldfarb, LLP | | | | | 185 Crossways Park Drive | (Name - If individual, state last, first, and middle name)
Woodbury | | 11797 | | | (Address) | (City) | NY
(State) | (Zip Code) | | | 12-14-2004 | | 2107 | | | \* Claims for exemption from the requirement that the annual reports be covered by the reports of an independent public accountant must be supported by a statement of facts and circumstances relied on as the basis of the exemption. See 17 CFR 240.17a-5(e)(l)(ii), if applicable. 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. {2}------------------------------------------------ #### OATH OR AFFIRMATION | Anthony Schexnayder | swear (or affirm) that, to the best of my knowledge and belief, the | |----------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------| | tinancial report pertaining to the firm of - Kopentech Capital Markets LLC | as ot | | 12/31 | 2023 , is true and correct. I turther swear (or affirm) that neither the company nor any | | | partner, officer, director, or equivalent person, as the case may be, has any proprietary interest in any account classified solely | | as that of a customer. | | Notary Public - #### This filing \*\* contains {check all applicable boxes): - (a) Statement of financial condition. - (b) Notes to consolidated 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). - O (d) Statement of cash flows. - [ (e) Statement of changes in stockholders' or partners' or sole proprietor's equity. - □ (f) Statement of changes in liabilities subordinated to claims of creditors. - □ {g) Notes to consolidated financial statements. - [ {h) Computation of net capital under 17 CFR 240.15c3-1 or 17 CFR 240.18a-1, as applicable. - ال (i) Computation of tangible net worth under 17 CFR 240.18a-2. - | - □ (k) Computation for determination of security-based swap reserve requirements pursuant to Exhibit B to 17 CFR 240.15c3-3 or Exhibit A to 17 CFR 240.18a-4, as applicable. - | {|} Computation for Determination of PAB Requirements under Exhibit A to § 240.15c3-3. - | (m) Information relating to possession or control requirements for customers under 17 CFR 240.15c3-3. - O (n) Information relating to possession or control requirements for security-based swap customers under 17 CFR 240.15c3-3(p)(2) or 17 CFR 240.18a-4, as applicable. - □ {o} Reconciliations, including appropriate explanations, of the FOCUS Report with computation of net worth under 17 CFR 240.15c3-1, 17 CFR 240.18a-2, as applicable, and the reserve requirements under 17 CFR 240.15c3-3 or 17 CFR 240.18a-4, as applicable, if material differences exist, or a statement that no material differences exist. - L (p) Summary of financial data for subsidiaries not consolidated in the statement of financial condition. - (q) Oath or affirmation in accordance with 17 CFR 240.17a-5, 17 CFR 240.17a-12, or 17 CFR 240.18a-7, as applicable. - | (r) Compliance report in accordance with 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable. - | {s} Exemption report in accordance with 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable. - (t) Independent public accountant's report based on an examination of the statement of financial condition. - | (u) Independent public accountant's report based on an examination of the financial statements under 17 CFR 240.17a-5, 17 CFR 240.18a-7, or 17 CFR 240.17a-12, as applicable. - | {v} Independent public accountant's report based on an examination of certain statements in the compliance report under 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable. - [ {w} Independent public accountant's report based on a review of the exemption report under 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable. - | (x) Supplemental reports on applying agreed-upon procedures, in accordance with 17 CFR 240.17a-12, as applicable. - | (y) Report describing any material inadequacies found to have existed since the date of the previous audit, or a statement that no material inadequacies exist, under 17 CFR 240.17a-12(k). - □ (z) Other: - \*\*To request confidential treatment of certain portions of this filing, see 17 CFR 240.17a-5(e)(2), as applicable. Title: Chief Executive Officer CINDY DE LEON Hotary Public - California Los Angeles County Commission # 2402308 My Comm, Expires Apr 27, 2026 ('Prtificate See attached {3}------------------------------------------------ #### **CALIFORNIA ACKNOWLEDGMENT CIVIL CODE § 1189** A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, o'r validity of that document. | State of California | }
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_::,__ __ | | | | | | ©2019 National Notary Association {4}------------------------------------------------ #### DECEMBER 31, 2023 #### TABLE OF CONTENTS | Report of Independent Registered Public Accounting Firm | | |---------------------------------------------------------|--| | Financial Statement | | | Statement of Financial Condition | | | Notes to the Financial Statement | | {5}------------------------------------------------ ![](_page_5_Picture_0.jpeg) #### **Weisberg, Mole, Krantz & Goldfarb, LLP Certified Public Accountants** #### **REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM** To the Managing Member of KopenTech Capital Markets, LLC #### **Opinion on the Financial Statement** We have audited the accompanying statement of financial condition of KopenTech Capital Markets, LLC (the "Company") as of December 31, 2023, and the related notes (collectively referred to as the "financial statement''). In our opinion, the statement of financial condition presents fairly, in all material respects, the financial position of the Company as of December 31, 2023, in conformity with accounting principles generally accepted in the United States of America. #### **Basis for Opinion** This financial statement is the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statement 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 statement is 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 statement, 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 statement. 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 statement. We believe that our audit provides a reasonable basis for our opinion. We have served as the Company's<-::a.:!:::;o;f *..t.,},* ~ .\_-*~,l'• f* Woodbury, New York February 15, 2024 > 185CrosswaysParkDrive,Woodbury, NewYorkll797 • Phone: 516-933-3800 • Fax: 516-933-1060 700 Kinderkamack Rd, Oradell, New Jersey 07649 • Phone: 201-655-6249 • Fax: 201-655-6098 www.weisbergmole.com {6}------------------------------------------------ #### STATEMENT OF FINANCIAL CONDITION DECEMBER 31, 2023 #### ASSETS | Cash
Deposit with clearing organization
Due from clearing organization
Prepaid expenses | ക | 1,810,356
500,000
9,875
13,982 | |--------------------------------------------------------------------------------------------------|------|-----------------------------------------| | Total assets | ಕ್ಕಾ | 2,334,213 | | LIABILITIES AND MEMBER'S EQUITY
Liabilities: | | | | Accounts payable | ಿ | 26,425 | | Total liabilities | | 26,425 | | Member's equity | | 2,307,788 | | Total liabilities and member's equity | ಕ್ಕಿ | 2,334,213 | The accompanying notes are an integral part of the financial statement. {7}------------------------------------------------ #### NOTES TO THE FINANCIAL STATEMENT DECEMBER 31, 2023 #### 1. ORGANIZATION AND DESCRIPTION OF BUSINESS KopenTech Capital Markets, LLC (the "Company") is wholly-owned by KopenTech, LLC (the "Member"). The Company is a registered broker-dealer under the Securities Exchange Act of 1934 and is a member of both the Financial Industry Regulatory Authority ("FINRA") and the Securities Investors Protection ("SIPC") since December 11, 2019. The operating agreement provides for the limited liability company to exist in perpetuity. The Member's limit on liability is based on the relevant state law. The Company operates an alternative trading system for subscribers interested in structured product investing and introduces trades to a clearing broker on a fully disclosed basis to assist customers in facilitating trades conducted on the platform. #### 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES #### Basis of presentation The accompanying financial statement of the Company has been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP"). #### Use of estimates The preparation of the statement of financial condition in conformity with U.S. GAAP, 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 statement. Actual results could differ from those estimates. #### Cash All of the Company's cash is held at Citibank. #### Accounts receivable Accounts receivable are reported net of an allowance for expected credit losses. The allowance is based on management's estimate of the amount of receivables that will actually be collected. Management determined that at December 31, 2023, an allowance for expected credit losses was not necessary. #### Income taxes As a wholly-owned single member limited liability company, the Company is considered to be a disregarded entity and thus does not file income tax returns in any jurisdiction. The Company files under the Member's consolidated tax return in which all items of income, expense, gains, and losses are reportable by the Member for tax purposes. 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H=5:A>;J ZA7o5A @7 Z5 CI==< H7==5H@>Z=5R :;K :HH7AK>;J=?45K :? 7C Y5H58Z5A [\R ]Q][U E? 7C Y5H58Z5A [\R ]Q][R @45 :87I;@ KI5 CA78 @45 ZA7o5A V:? y~RPzU {9}------------------------------------------------ #### NOTES TO THE FINANCIAL STATEMENT DECEMBER 31, 2023 #### 3. DUE FROM CLEARING BROKER Pursuant to the agreement with its clearing broker, the Company is required to maintain a clearing deposit of \$500,000. Additionally, as provided in the clearing agreement, the Company must maintain minimum net capital on its FOCUS reports of \$2,000,000 and will be subject to minimum clearing charges of \$15,000 per month once the eight-month period of reduced minimum clearing charges has lapsed. #### 4. CONCENTRATION OF CREDIT RISK The Company's cash deposits are held by one financial institution and therefore are subject to credit risk to the extent those balances exceeded the Federal Deposit Insurance Corporation insurance limit of \$250,000. The Company's uninsured amount at December 31, 2023 was \$1,560,356. The Company has not experienced any losses in such accounts and does not believe it is exposed to any significant credit risk on cash. #### 5. RELATED PARTY TRANSACTIONS Pursuant to an expense sharing agreement, the Company reimburses the Member for allocated salaries, rent and communication expenses paid for by the Member. These charges are updated periodically and determined based on percentages of personnel time and other factors. As of December 31, 2023, there was no balance due to the Member. #### 6. NET CAPITAL REQUIREMENTS The Company is subject to the uniform net capital requirements of Rule 15c3-1 (The "Rule") of the Securities Exchange Act of 1934, as amended, which requires the Company to maintain, at all times, sufficient liquid assets to cover indebtedness. In accordance with the Rule, the Company is required to maintain defined minimum net capital of the greater of \$5,000 or 6 2/3% of aggregate indebtedness. At December 31, 2023, the Company had net capital, as defined, of \$2,293,806, which exceeded the required minimum net capital of \$5,000 by \$2,288,806. Aggregate indebtedness at December 31, 2023, totaled \$26,425. The Company's percentage of aggregate indebtedness to net capital was 1.15%. {10}------------------------------------------------ #### NOTES TO THE FINANCIAL STATEMENT DECEMBER 31, 2023 #### 6. NET CAPITAL REQUIREMENTS (continued) The Company has an agreement with its clearing broker to clear securities transactions, carry customer accounts on a fully-disclosed basis and perform record keeping functions and accordingly, operates under the exemptive provisions of Securities and Exchange Commission Rule 15c3-3(k)(2)(ii). In addition, the operation of an alternative trading systems falls under the relief provided by Footnote 74 of SEC Release No. 34-70073. #### 7. IDEMNIFICATIONS In the normal course of its business, the Company indemnifies its clearing broker against specified potential losses in connection with its acting as an agent of, or providing services to, the Company. The maximum potential amount of future payments that the Company could be required to make under this indemnification cannot be estimated. However, the Company believes that it is unlikely it will have to make payments under these arrangements and, as such, has not recorded any contingent liability in the financial statements for this indemnification. #### LITIGATION 8. In 2023 the Company was named as a co-defendant in two lawsuits. The first complaint asserts wrongful termination of an employee. The second complaint asserts various claims related to intellectual property rights, employment, and breach of contract, among other matters. Both complaints are in the very early stages of proceedings, and both have been presented to the Company's insurance carrier for evaluation and representation. The insurance company claims adjuster has accepted the first claim but has not yet made a determination regarding whether the second claim is covered under the terms of the policy. The Company believes both complaints are without merit and plans to vigorously defend its position. A negative uninsured outcome could have a material adverse impact on the financial condition of the Company. The Company believes a loss accrual for these matters is not appropriate at this time. #### 9. SUBSEQUENT EVENTS Management of the Company has evaluated events and transactions that have occurred through February 15, 2024, the date this financial statement was issued and determined that there are no material events that would require disclosures in the Company's financial statement. Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.