# M. S. HOWELLS & CO. X-17A-5 (2026-03-20) — Broker-dealer annual report - Company: M. S. HOWELLS & CO. - Form: X-17A-5 - Filed: 2026-03-20 - Period: 2025-12-31 - Accession: 0001113951-26-000001 - CIK: 1113951 - File #: 8-52558 - Type: Broker-dealer - Material weakness: No - Auditor: Cherry Bekaert LLP - Auditor location: Denver, CO - Contact: Marcy Crites - Phone: 480-563-2032 - Email: marcy@mshowells.com - Website: mshowells.com - Signed by: Mark Howells (Executive Chairman) Original filing: https://www.sec.gov/Archives/edgar/data/1113951/000111395126000001/EDGARPublicStmtFinCond2025.pdf --- {0}------------------------------------------------ ![](_page_0_Picture_0.jpeg) # REPORT PURSUANT TO RULE 17a-5(d) YEAR ENDED December 31, 2025 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. {1}------------------------------------------------ # CONTENTS Page (s) # Form X-17A-5 Part III (Facing Page) 1 Oath or Affirmation 2 Report of Independent Registered Public Accounting Firm 3 Statement of Financial Condition 4 Notes to Financial Statements 5 13 {2}------------------------------------------------ | | FILING FOR THE PERIOD BEGINNING 01/01/25 | 12/31/25 | | | | |----------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------|----------------|---------------------|--|--| | MM/DD/YY
MM/DD/YY | | | | | | | | A. REGISTRANT IDENTIFICATION | | | | | | NAME OF FIRM: M.S. HOWElls & Co. | | | | | | | TYPE OF REGISTRANT (check all applicable boxes):
Check here if respondent is also an OTC derivatives dealer | @ Broker-dealer
ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use a P.O. box no.) | | | | | | 23350 N Pima Rd | | | | | | | | (No. and Street) | | | | | | Scottsdale | A7 | | 85255 | | | | (City) | (State) | | (Zip Code) | | | | PERSON TO CONTACT WITH REGARD TO THIS FILING | | | | | | | | 480-563-2032 | | marcy@mshowells.com | | | | Marcy Crites | | | (Email Address) | | | | (Name) | (Area Code - Telephone Number) | | | | | | | B. ACCOUNTANT IDENTIFICATION | | | | | | Cherry Bekaert LLP | INDEPENDENT PUBLIC ACCOUNTANT whose reports are contained in this filing* | | | | | | | (Name - if individual, state last, first, and middle name) | | | | | | | 4601 DTC Blvd., Ste 700 Denver | CO | 80231 | | | | (Address)
10/20/2003 | (City) | (State)
677 | (Zip Code) | | | {3}------------------------------------------------ ![](_page_3_Picture_4.jpeg) - - - - - - - - - - - - - - - - - - - - - - - - - - - {4}------------------------------------------------ ![](_page_4_Picture_0.jpeg) # REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Shareholders of M.S. Howells & CO. #### Opinion on the Financial Statements We have audited the accompanying statement of financial condition of M.S. Howells & CO. (the Company) as of December 31, 2025, 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, 2025 in conformity with accounting principles generally accepted in the United States of America. # Basis for Opinion These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on the Companys 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. We have served as M.S. Howells & CO.s auditor since 2025. Denver, Colorado March 6, 2026 {5}------------------------------------------------ # STATEMENT OF FINANCIAL CONDITION AS OF DECEMBER 31, 2025 #### ASSETS | Cash and cash equivalents | \$
1,934,336 | |-------------------------------------------------------------|-----------------| | Commissions receivable | 30,839 | | Deposit with Clearing Broker, at fair value (Notes 1 and 7) | 250,000 | | Due from Clearing Broker | 153,353 | | Equipment, furniture, and leasehold improvements, net of | | | accumulated depreciation of \$359,162 (Notes 1 and 2) | 53,609 | | Operating lease right-of-use asset (Notes 1 and 3) | 2,373,840 | | Related party receivables (Note 4) | 709,863 | | Securities owned, at fair value (Notes 1 and 7) | 1,683,125 | | Other assets | 236,390 | | Total assets | \$
7,425,355 | | LIABILITIES AND SHAREHOLDERS' EQUITY | | | LIABILITIES: | | | Accounts payable and accrued expenses | \$
126,987 | | Accrued soft dollar credits (Note 1) | 571,076 | | Commissions payable | 186,056 | | Operating lease liability (Notes 1 and 3) | 2,491,646 | | Total liabilities | 3,375,765 | | COMMITMENTS AND CONTINGENCIES (Note 6) | | | SHAREHOLDERS' EQUITY: | | | Common stock, \$0.01 par value, authorized 3,000 shares, | | | 1,500 shares issued and outstanding | 15 | | Additional paid-in capital | 2,333,798 | | Surplus | 1,715,777 | | Total shareholders' equity | 4,049,590 | | Total liabilities and shareholders' equity | \$
7,425,355 | The accompanying notes are an integral part of this statement. {6}------------------------------------------------ # NOTES TO FINANCIAL STATEMENTS # NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES # Organization and Business M.S. Howells & Co. (the Company ) was incorporated in Delaware on April 11, 2000, and is a securities broker-dealer serving institutional and retail investors. The Company records securities transactions and related revenue and expenses on a trade-date basis. Other income is recognized when earned. The Company, under Rule 15c3-3(k)(2)(ii), is exempt from the reserve and possession or control requirements of Rule 15c3-3 of the Securities and Exchange Commission. The Company does not carry or clear customer accounts. Accordingly, all customer transactions are executed and cleared on behalf of the Company by Pershing LLC (the Clearing Broker ) on a fully disclosed basis. The Company s agreement with its Clearing Broker provides that as a Clearing Broker, that firm will make and keep such records of the transactions effected and cleared in the customer accounts as are customarily made and kept by the Clearing Broker pursuant to the requirements of Rules 17a-3 and 17a-4 of the Securities and Exchange Act of 1934, as amended (the Act ). The Clearing Broker also performs all services customarily incident thereon, including the preparation and distribution of customer confirmations, statements and maintenance margin requirements under the Act and the rules of the Self-Regulatory Organizations of which the Company is a member. # Equipment, Furniture, and Leasehold Improvements Equipment, furniture, and leasehold improvements are stated at cost, less accumulated depreciation. Depreciation on equipment and furniture is provided in amounts sufficient to relate to the cost of the assets to operate over their estimated useful lives ranging from three to five years using the straight-line method. Leasehold improvements are amortized over the life of the initial lease. # Cash and Cash Equivalents Cash includes demand deposits held at financial institutions. Cash equivalents include short-term, highly liquid investments of sufficient credit quality that are readily convertible to known amounts of cash and have original maturities of three months or less. Cash equivalents are carried at cost, plus accrued interest, which approximates fair value. Cash and cash equivalents are held at major financial institutions and are subject to credit risk to the extent those balances exceed applicable Federal Deposit Insurance Corporation (FDIC) or Securities Investor Protection Corporation (SIPC) limitations. The Company is subject to \$1,684,255 of credit risk on cash and cash equivalents. {7}------------------------------------------------ # NOTES TO FINANCIAL STATEMENTS (continued) # NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) # Income Taxes The Company files an income tax return in the U.S. federal jurisdiction and may file income tax returns in various U.S. states and local jurisdictions. The Company is not subject to income tax return examinations by major taxing authorities for the years prior to 2022. The Company is recognized as an S- , state, and local Beginning in 2025, the Company elected -through entity tax regime, which permits qualifying pass-through entities to remit state income taxes at the entity level on behalf of their owners. The Company intends to evaluate and may elect similar pass-through entity tax regimes in other jurisdictions beginning in 2026. The Company has evaluated its tax positions and determined that it has no uncertain tax positions that require recognition or disclosure in the financial statements. No interest expense or penalties have been recognized as of and for the year ended December 31, 2025. # Fair Value of Financial Instruments The Company s financial instruments, including cash and cash equivalents, commissions receivable, deposit with Clearing Broker, due from Clearing Broker, related party receivables, other assets, accounts payable and accrued expenses, accrued soft dollar credits, and commissions payable are carried at amounts that approximate fair value due to the short-term nature of the instruments. # Securities Inventory The Company utilizes the provisions of Accounting Standards Codification 820 Fair Value measurement date. In determining fair value, the Company uses various valuation approaches. ASC 820 establishes a fair value hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are those that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Company. Unobservable inputs reflect the developed based on the best information available in the circumstances. The fair value hierarchy is categorized into three levels based on the inputs as follows: {8}------------------------------------------------ # NOTES TO FINANCIAL STATEMENTS (continued) # NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) #### Securities Inventory (continued) Level 1 Valuations based on adjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access. Valuation adjustments and blockage discounts are not applied to Level 1 securities. Since valuations are based on quoted prices that are readily available in an active market, valuation of these securities does not entail a significant degree of judgment. Level 2 Valuations based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly. Level 3 Valuations based on inputs that are unobservable and significant to the overall fair value measurement. The availability of valuation techniques and observable inputs can vary from security to security and is affected by a wide variety of factors, including the type of security, whether the security is new and not yet established in the marketplace, and other characteristics particular to the transaction. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Those estimated values do not necessarily represent the amounts that may be ultimately realized due to the occurrence of future circumstances that cannot be reasonably determined. Because of the inherent uncertainty of valuation, those estimated values may be materially higher or lower than the values that would have been used had a ready market for the securities existed. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for securities categorized in Level 3. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement falls in its entirety is determined by the lowest level input that is significant to the fair value measurement. Fair value is a market-based measure considered from the prospective of a market participant rather than an entity-specific measure. Therefore, even when market assumptions are not readily available, the hat market participants would use in pricing the asset or liability at the measurement date. The Company uses prices and inputs that are current as of the measurement date, including during periods of market dislocation. In periods of market dislocation, the observability of prices and inputs may be reduced for many securities. This condition could cause a security to be reclassified to a lower level within the fair value hierarchy. The Company values its securities that are freely tradable and are listed on a national securities exchange or reported on the NASDAQ national market at their last sales price as of the last business day of the year. Changes in fair value are {9}------------------------------------------------ # NOTES TO FINANCIAL STATEMENTS (continued) # NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) # Securities Inventory (concluded) Many cash and over-the-counter (OTC) contracts have bid-and-ask prices that can be observed in the marketplace. Bid prices reflect the highest price that the marketplace participants are willing to pay for an asset. Ask prices represent the lowest price that the marketplace participants are willing to accept for an asset. For securities whose inputs are based on bidin the OTC markets and listed securities for which no sale was reported on that date are valued at their these investments level 1 securities for active markets and level 2 securities for thinly traded markets. As of December 31, 2025, the Company held securities at a value of \$1,933,125, of which \$250,000 is included in deposit with Clearing Broker. Securities are held at major financial institutions and are subject to credit risk to the extent those balances exceed Securities Investor Protection Corporation (SIPC) limitations. The Company is subject to \$1,586,478 of credit risk on securities inventory. # 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. # Stock-Based Compensation The Company follows the guidance in FASB ASC 718, Compensation-Stock Compensation. FASB ASC 718 requires companies to measure and recognize the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value. During 2025 the Company had no sharebased compensation. {10}------------------------------------------------ # NOTES TO FINANCIAL STATEMENTS (continued) # NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (concluded) #### Leases (ASC 842) In February 2016, the FASB issued ASU No. 2016 leases longer than one year, a lessee recognize in the balance sheet a right-of-use asset, representing the right to use the underlying asset for the lease term, and a lease liability, representing the liability to make lease payments. It also requires that for finance leases, a lessee recognize interest expense on the lease liability, separately from the amortization of the right-of-use asset in the Statements of Operations, while for operating leases, such amounts should be recognized as a combined expense. The Company had no financing leases upon adoption of the ASU or throughout 2025. In addition, this ASU requires expanded disclosures about the nature and terms of lease agreements. The Company has an operating lease for office space which terminates on April 30, 2045. The Company | Right-of-use asset | 2.772.890 | |--------------------------|-----------| | Accumulated amortization | (399.050) | | Right-of-use, net | 2.373.841 | | Year | Operating Lease | | | |-----------------------|-----------------|-----------|--| | 2026 | S | 175,716 | | | 2027 | | 175,716 | | | 2028 | | 175,716 | | | 2029 | | 175,716 | | | 2030 | | 175,716 | | | Thereafter | | 2,518,596 | | | Total lease payments | | 3,397,176 | | | Less imputed interest | | (905,530) | | | Liability, net | ક | 2.491. | | {11}------------------------------------------------ # NOTES TO FINANCIAL STATEMENTS (continued) # NOTE 2 - EQUIPMENT, FURNITURE, AND LEASEHOLD IMPROVEMENTS, NET Equipment, furniture, and leasehold improvements consist of the following as of December 31, 2025: | Equipment | S | 70.392 | |-------------------------------------------------------|---|-----------| | Furniture | | 49.107 | | Leasehold Improvements | | 293,272 | | | | 412,771 | | Accumulated Depreciation | | (359,162) | | Equipment, furniture, and leasehold improvements, net | | 53,609 | # NOTE 3 - OPERATING LEASE RIGHT-OF-USE ASSETS AND LIABILITIES The Company may enter into operating leases for real estate, office equipment and other assets, substantially all of which are used in connection with its operations. The Company adopted ASU No. 2016-02 in January 2019, which required the Company to recognize, for leases longer than one year, a right-of-use asset representing the right to use the underlying asset for the lease term, and a lease liability representing the liability to make payments. The lease term is generally determined based on the contractual maturity of the lease. For leases where the Company has the option to terminate or extend the lease, an assessment of the likelihood of exercising the option is incorporated into the determination of the lease term. Such assessment is initially performed at the inception of the lease and is updated if events occur that impact the original assessment. of the future cash flows related to payments over the duration of the lease life, discounted based on tal borrowing rate of 3.38% as of October 2022. lease is twenty-five (25) years and seven (7) months beginning October 1, 2022 and ending April 30, 2045. {12}------------------------------------------------ # NOTES TO FINANCIAL STATEMENTS (continued) # NOTE 4 - RELATED PARTY TRANSACTIONS Related party receivables represent amounts receivable from affiliated entities. There are no formal agreements in place. s contribution not exceeding 3% of the Participant s compensation, plus 50% of each Participant's elective contribution in excess of 3% but not in excess of 5% of the Participant's compensation. # NOTE 5 - NET CAPITAL REQUIREMENTS Pursuant to the net capital provisions of Rule 15c3-1 of the Securities Exchange Act of 1934, the Company is required to maintain a minimum net capital, as defined under such provisions. As of December 31, 2025, the Company had net capital and net capital requirements of \$3,049,715 and \$100,000, respectively. The Company s net capital ratio (aggregate indebtedness to net capital) was 0.33 to 1. According to Rule 15c3-1, the Company s net capital ratio shall not exceed 15 to 1. {13}------------------------------------------------ # NOTES TO FINANCIAL STATEMENTS (continued) # NOTE 6 - FINANCIAL INSTRUMENTS, OFF-BALANCE SHEET RISK AND CONTINGENCIES execution, settlement and financing of various client securities transactions. These activities may expose the Company to off-balance sheet risk. In the event the client fails to satisfy its obligations, the Company may be required to purchase or sell financial instruments at prevailing market prices in order to fulfill the During 2025 and through the date of issuance, there have been no new litigation matters. The following updates relate to the two matters previously disclosed. On May 21, 2024, the Company received a legal complaint alleging that a registered representative emailed a prior broker-dealer statement to a third party without authorization. The complaint was dismissed on April 23, 2025. Additionally, in 2024, the Company was engaged as a placement agent for an equity raise conducted by terminated the placement agent engagement and canceled warrants issued as part of the initial closing of the offering. M.S. Howells & Co., together with other investment holders, filed a Verified Complaint for Equitable Rescission, Declaratory Relief and Unjust Enrichment in the Court of Chancery of the State of Delaware. In response, the IB Client filed a counterclaim against M.S. Howells & Co. on August 29, 2024. The Company strongly believes these counterclaims are without merit. On December 4, 2024, IB Client filed for Chapter 7 bankruptcy protection. As previously disclosed, the filing was subsequently stayed and has remained subject to the automatic stay through 2025 and through the date of issuance of these financial statements. The Company bears the risk of financial failure by its Clearing Broker. If the Clearing Broker should cease forfeiture. {14}------------------------------------------------ # NOTES TO FINANCIAL STATEMENTS (continued) # NOTE 7 - FAIR VALUE MEASUREMENTS December 31, 2025: | | Quoted Prices in
Active Markets
for Identical Assets
(Level 1) | | Significant
Other Observable
Inputs
(Level 2) | | Significant
Unobservable
Inputs
(Level 3) | | Balance as of
December 31, 2025 | | |------------------------------------|-------------------------------------------------------------------------|------------------------|--------------------------------------------------------|----|----------------------------------------------------|--|------------------------------------|--| | Deposit with Clearing Broker \$ | | 250.000 | l | ಳಿ | । | | ಕೆ
250.000 | | | Securities Owned
Total | | 1,683,125
1,933,125 | | | | | 1,683,125
1,933,125 | | The Company did not have any significant transfers between Level 1 and Level 2 during the year ended December 31, 2025. # NOTE 9 - SUBSEQUENT EVENTS The Company has performed an evaluation of subsequent events through the date the financial statements were issued. The evaluation did not result in any subsequent events that required disclosures and/or adjustments. Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.