# SMI CAPITAL MARKETS LLC X-17A-5 (2024-04-03) — Broker-dealer annual report - Company: SMI CAPITAL MARKETS LLC - Form: X-17A-5 - Filed: 2024-04-03 - Period: 2023-12-31 - Accession: 0001096906-24-000724 - CIK: 1511227 - File #: 8-68794 - Type: Broker-dealer - Material weakness: No - Auditor: BF Borgers CPA PC - Auditor location: Lakewood, CO - Contact: Dale Garnett - Phone: 206-499-0158 - Email: dale@borealiscapital-llc.com - Website: borealiscapital-llc.com - Signed by: DALE GARNETT (CFO) Original filing: https://www.sec.gov/Archives/edgar/data/1511227/000109690624000724/audit.pdf --- {0}------------------------------------------------ **UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549** > **ANNUAL REPORTS FORM X-17A-5** 0MB APPROVAL 0MB Number: 3235-0123 Expires: Nov. 30, 2026 Estimated average burden hours per response: 12 > SEC FILE NUMBER 8-68794 # **PART** Ill **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 **1/1/2023** AND ENDING **12/31 /2023** MM/00/YY MM/00/YY **A. REGISTRANT IDENTIFICATION** # NAME oF FIRM: SM I Capital Markets LLC TYPE OF REGISTRANT (check all applicable boxes): ~ Broker-dealer D Security-based swap dealer D Major security-based swap participant D Check here if respondent is also an OTC derivatives dealer ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use a P.O. box no.) # 2018 156th Ave NE #100 | | (No. and Street) | | | |------------------------------------------------------------------------------------------------|------------------------------------------------------------|-----------------|--------------------------------------------| | Bellevue | WA | | 98007 | | (City) | (State) | | (Zip Code) | | PERSON TO CONTACT WITH REGARD TO THIS FILING | | | | | Dale Garnett | 206.499.0158 | | dale@borealiscapital-llc.com | | (Name) | (Area Code - Telephone Number) | (Email Address) | | | | 8. ACCOUNTANT IDENTIFICATION | | | | | | | | | INDEPENDENT PUBLIC ACCOUNTANT whose reports are contained in this filing*
BF Borgers CPA PC | | | | | | (Name - if individual, state last, first, and middle name) | | | | 5400 W Cedar Avenue | Lakewood | | 80026 | | (Address) | (City) | co
(State) | (Zip Code) | | 5/11/2010 | | 5041 | | | (Date of Registration with PCAOB)(if applicable) | | | (PCAOB Registration Number, if applicable) | • 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. {1}------------------------------------------------ ### OATH **OR AFFIRMATION** | I, DALE GARNETT | | | swear (or affirm) that, to the best of my knowledge and belief, the | | | |-----------------|--|--|---------------------------------------------------------------------|------------------------------------------------------------------------------------|-------| | | | | 2~ | financial report pertaining to the firm of SMI CAPITAL MARKETS LLC | as of | | 12/31 | | | | is true and correct. I further 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. ![](_page_1_Figure_3.jpeg) | Title:
CFO | | |---------------|--| # **This filing\*\* contains (check all applicable boxes):** - ii (a) Statement of financial condition. - ii (b) Notes to consolidated statement of financial condition. - ii (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). - Ii (d) Statement of cash flows. - ii (e) Statement of changes in stockholders' or partners' or sole proprietor's equity. - D (f) Statement of changes in liabilities subordinated to claims of creditors. - ii (g) Notes to consolidated financial statements. - ii (h) Computation of net capital under 17 CFR 240.15c3-1 or 17 CFR 240.18a-l, as applicable. - D (i) Computation of tangible net worth under 17 CFR 240.18a-2. - D (j) Computation for determination of customer reserve requirements pursuant to Exhibit A to 17 CFR 240.15c3-3. - D (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. - D (I) Computation for Determination of PAB Requirements under Exhibit A to§ 240.15c3-3. - D (m) Information relating to possession or control requirements for customers under 17 CFR 240.1Sc3-3. - D (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. - ii (o) Reconciliations, including appropriate explanations, of the FOCUS Report with computation of net capital or tangible net worth under 17 CFR 240.15c3-1, 17 CFR 240.lBa-l, or 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. - D (p) Summary of financial data for subsidiaries not consolidated in the statement of financial condition. - ii (q) Oath or affirmation in accordance with 17 CFR 240.17a-5, 17 CFR 240.17a-12, or 17 CFR 240.lBa-7, as applicable. - D (r) Compliance report in accordance with 17 CFR 240.17a-5 or 17 CFR 240.lBa-7, as applicable. - D (s) Exemption report in accordance with 17 CFR 240.17a-5 or 17 CFR 240.lBa-7, as applicable. - ii (t) Independent public accountant's report based on an examination of the statement of financial condition. - ::::J (u) Independent public accountant's report based on an examination of the financial report or financial statements under 17 CFR 240.17a-5, 17 CFR 240.18a-7, or 17 CFR 240.17a-12, as applicable. - D (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. - D (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. - 0 (x) Supplemental reports on applying agreed-upon procedures, in accordance with 17 CFR 240.15c3-le or 17 CFR 240.17a-12, as applicable. - D (y) Report describing any mat erial inadequacies found to exist or 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). D (z) Other: \_\_\_\_\_\_\_ \_\_\_ \_\_\_\_\_\_\_\_\_\_\_\_ \_\_\_\_ \_\_\_ \_\_ \_ - - 0 *To request confident/a/ treatment of certain portions of this filing, see 17 CFR 240.17a-5(e)(3) or 17 CFR 240.18a-7(d)(2), as applicable.* {2}------------------------------------------------ # SMI CAPITAL MARKETS LLC REPORT PURSUANT TO RULE I 7a-5(d) YEAR ENDED DECEMBER 31, 2023 The report is deemed **CONFIDENTIAL** in accordance with Rule 17a-5(e)(3) under the Securities Exchange Act of 1934. A statement of financial condition has been filed with the Securities and Exchange Commission simultaneously herewith as a **PUBLIC DOCUMENT.** {3}------------------------------------------------ # **CONTENTS** | | Page | |---------------------------------------------------------------------------|------| | Independent Auditors' Report | 3 | | Statement of Financial Condition | 4 | | Statement of Operations | 5 | | Statement of Changes in Shareholders' Equity | 6 | | Statement of Cash Flows | 7 | | Notes to Financial Statements | 8 | | Supplementary Schedule: | | | Computation of Net Capital Pursuant to Uniform Net Capital
Rule 15c3-l | 11 | | Report of Independent Registered Public Accounting Firm | 12 | | Exemption Report | 13 | {4}------------------------------------------------ ![](_page_4_Picture_0.jpeg) www.bfbcpa.us # **Report of Independent Registered Public Accounting Firm** To the Directors and Equity Owners of SMI Capital Markets LLC #### **Opinion on the Financial Statements** We have audited the accompanying statement of financial condition of SMI Capital Markets LLC (the "Company") as of December 31, 2023. the related statements of operations, changes in member's equity. and cash flows for the years 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. 2023, and the results of its operations and its cash flows for the years then ended, in confonnity with accounting principles generally accepted in the United States. #### **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 audits. We are a public accounting finn 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 audits in accordance with the standards of the PCAOB. Those standards require that we plan and perfonn the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included perfonning procedures to assess the risks of material misstatement of the financial statements. whether due to error or fraud, and perfonning 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 audits provide a reasonable basis for our opinion. #### **Supplemental Information** The information contained in "Supplemental Schedule'· has been subjected to audit procedures performed in conjunction with the audit of the 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 perfonning procedures to test the completeness and accuracy of the information presented in the Supplemental Information. In forming our opinion on the Supplemental Infonnation, we evaluated whether the Supplemental lnfonnation, including its fonn and content is presented in confonnity with 17 C.F.R. § 240.17a-5. In our opinion, supplementary schedule is fairly stated, in all material respects. in relation to the financial statements taken as a whole. Bf~ CPA PC Certified Public Accountants We have served as the Company's auditor since 2015. Lakewood, CO March 7. 2024 {5}------------------------------------------------ # **STATEMENT OF FINANCIAL CONDITION DECEMBER 31, 2023** | ASSETS | | |------------------------------|--------| | Current Assets | | | Cash | 17,234 | | Deposits | &37 | | Total current assets | 18.071 | | Total assets | | | LIABILITIES | 5,850 | | Member Equity | 12,221 | | Total Liabilities and Equity | 18.071 | The accompanying notes are an integral part of this statement. {6}------------------------------------------------ # **STATEMENT OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2023** | | Jan -Dec | |------------------------------------|----------| | Revenue | | | Expenses | | | General and Administrative expense | 3,414 | | Insurance expense | 566 | | Officer compensation | 65,000 | | Professional fees | 13,690 | | Registration and licenses | 4,054 | | Rent expense | 11.050 | | Total expenses | -97,774 | Net Profit/Loss -97,774 5 {7}------------------------------------------------ # **STATEMENT OF CHANGES IN MEMBER'S EQUITY YEAR ENDED DECEMBER 31, 2023** | Balance at January I, 2023 | 13,895 | |------------------------------|---------| | Net Profit | -97,774 | | Capital Contributions | 96, 100 | | Balance at December 31, 2023 | 12,221 | The accompanying notes are an integral part of this statement. 6 {8}------------------------------------------------ # **STATEMENT OF CASH FLOWS YEAR ENDED DECEMBER 31, 2023** | | December
31, 2023 | |----------------------------------------------------------------------------|----------------------| | OPERA TING ACTIVITIES | | | Net Profit | -97,774 | | Adjustments to reconcile Net Income to net cash
provided by operations: | | | Decrease in deposits with clearing brokers | 2 | | Increase in accounts payable | 5,850 | | Net cash used in operating activities | -91,922 | | CASH FLOWS FROM FINANCING | | | Member's capital additions | 96,100 | | Net cash provided by financing activities | 96, 100 | | Net cash increase for period | 4,178 | | Cash and Cash Equivalents, at beginning of year | 13,056 | | Cash and Cash Equivalents, at end of year | 17,234 | 7 {9}------------------------------------------------ ## **NOTE 1 - SUMMARY OF SIGNIFICANTACCOUNTJNG POLICIES** #### A) Nature of Business SMI Capital Markets LLC, formerly known as Park Bridge Securities LLC (the "Company") is a single member limited liability company established in March 2009, that provides advisory services related to mergers, acquisitions, and other corporate transactions which involve the transfer or issuance of securities. On November 18, 2011, the Company's application with the U.S. Securities and Exchange Commission for registration as a broker/dealer pursuant to Section I 5(b) of the Securities Exchange Act of 1934 was approved. The Company is a member of the Financial Industry Regulatory Authority (FINRA). ### B) Basis of Accounting The Company's financial statements are prepared using accrual basis of accounting in accordance with accounting principles general accepted in the United States of America. It is the responsibility of management to make sure that the generally accepted accounting principles are followed. #### C) Income Taxes The Company, with the consent of its member, has elected to be treated as a disregarded entity for federal and state income tax purposes. As a result, the taxable income of the Company will be included in the income tax return of its member, in accordance with the provisions of the Internal Revenue Code. As such, there is no provision for income taxes. The Company has adopted ASC Topic 740-10, *Accounting for Uncertainty in Income Taxes,* which prescribes a recognition threshold and measurement attribute for financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. For the year ended December 31, 2015, the Company has no material uncertain tax positions to be accounted for in the financial statements under the new rules. The company recognizes interest and penalties, if any, related to unrecognized tax benefits in interest expense. The Company is subject to routine audits by taxing jurisdiction; however. there are currently no audits for any tax periods in progress. Management believes it is no longer subject to income tax examinations for the years prior to 2012. #### D) Revenue Recognition Revenue is recognized when the transaction is successfully consummated. Revenue arising from contingent advisory fee assignments is recognized, subject to the absence of uncertainties or the completion of the assignment. Revenue is also recognized when an agreement exists and completion is reasonably expected. In instances where uncertainties exist or as to whether the assignment is completed as agreed upon, revenue is recognized when such uncertainties cease to exist. Expenses are recorded when incurred except in the case of contingent advisory fee assignments, which are recorded when the fee is recognized as earned. ## E) Regulatory Requirements The Company is a registered broker-dealer and, accordingly, is subject to the net capital rules of the Securities Exchange Commission. Under these rules, the Company is required to maintain minimum Net Capital, as defined under Rule l 5c3-1 of the Securities Exchange Act of 1934 (as amended). ## F) 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 {10}------------------------------------------------ and disclosure of contingent assets and liabilities at the date of financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. #### G) Subsequent Events The Company has performed an evaluation of subsequent events through January 30, 2018, which is the date the financial statements were available to be issued, noting no events which affect the financial statements as of December 31 , 2017. # **NOTE 2 - RELATED PARTY TRANSACTIONS** The Company entered into a management agreement whereby the Company reimburses the owner for certain costs that are shared between the entities. These costs include the use of facilities and other operating expenses. The amount paid to the related party pursuant to the management agreement for the year ended December 31, 2023 totaled \$ I 0,200. As of December 31, 2023, there were no amounts due to the related party. #### **NOTE 3** - **CONCENTRATIONS OF CREDIT RISK** All of the Company's cash is maintained in a single bank. The Company has exposure to credit risk to the extent its cash exceeds the amounts covered by federal deposit insurance. For the year ended December3 I, 2021 the amounts covered by federal deposit insurance is \$250,000. As of December 31, 2023, there were no uninsured amounts. #### **NOTE 4 - PURCHASE OF COMPANY** On September I, 2015, 100% of the ownership interests of the Company was purchased by the current owner. The price of said purchase was for \$60,000 that was paid in full in US dollars. No financial liabilities were assumed or carried over at the time of the sale. {11}------------------------------------------------ # **COMPUTATION OF NET CAPITAL PURSUANT TO UNIFORM NET CAPITAL RULE 15c3-1 DECEMBER 31, 2023** | Total Capital from Statement of Financial Condition | 18,071 | | | |-----------------------------------------------------|--------|--|--| | Less
Non-
Allowable Assets | (837) | | | | Net Capital Before Haircuts on Securities Positions | | | | | Less
Haircuts | 0 | | | | Net Capital | 17,234 | | | | Aggregate Indebtedness | | | | | Total A.I. Liabilities | 5.850 | | | | Percentage of A.I. To Net Capital | 33.9% | | | | | | | | | Computation of Basic Net Capital Requirement | | | | | Minimum Net Capital (6 2/3% of Total A.I.) | 0 | | | | Minimum Dollar Net Capital Required | 5.000 | | | | | | | | Net Capital Requirement (Greater of Al or Dollar Amnt Requirement) Excess Net Capital See the accompanying Independent Auditors' Report. 5,850 6,384 {12}------------------------------------------------ # **EXEMPTION REPORT** SMI CAPITAL MARKETS 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.l 7a-5(d) (1) and (4). To the best of its knowledge and belief, the Company states the following: - (1 ) The Company does not claim an exemption under paragraph (k) of 17 C.F.R. § 240. 15c3-3, and - (2) The Company is filing this Exemption Report relying on Footnote 74 of the SEC Release No. 34- 70073 adopting amendments to 17 C.F.R. § 240.l 7a-5 because the Company limits its business activities exclusively to: (1) receiving transaction-based compensation for identifying potential merger and acquisition opportunities for clients, referring securities transactions to other brokerdealers, or providing technology or platform services; (2) participating in distributions of securities (other than firm commitment underwritings) in accordance with the requirements of paragraphs (a) or (b)(2) of Rule 1Sc2-4; and the Company (1) did not directly or indirectly receive, hold, or otherwise owe funds or securities for or to customers, ( other than money or other consideration received and promptly transmitted in compliance with paragraph (a) or (b)(2) cf Rule J5c2-4 and/or funds received and promptly transmitted for effecting transactions via subscriptions on a subscription way basis where the funds are payable to the issuer or its agent and not to the Company); (2) did not carry accounts of or for customers; and (3) did not carry PAB accounts (as defined in Rule l 5c3·3) throughout the most recent fiscal year without exception. SMI CAPITAL MARKETS, LLC I, Dale Garnett swear that, to the best of my knowledge and belief. this Exemption Report is true and :~rect~/'j\_.1.:44:\_\_-- Title: CFO March 7, 2024 Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.