# ANDERSON LENEAVE & CO. X-17A-5 (2023-02-13) — Broker-dealer annual report - Company: ANDERSON LENEAVE & CO. - Form: X-17A-5 - Filed: 2023-02-13 - Period: 2022-12-31 - Accession: 0001114839-23-000002 - CIK: 1114839 - File #: 8-52584 - Type: Broker-dealer - Material weakness: No - Auditor: Cherry Bekaert, LLC - Auditor location: Charlotte, NC - Contact: Gregory LeNeave - Phone: 7045529212 - Email: gleneave@andersonleneave.com - Website: andersonleneave.com - Signed by: Gregory LeNeave (President) Original filing: https://www.sec.gov/Archives/edgar/data/1114839/000111483923000002/Public_2022.pdf --- {0}------------------------------------------------ **UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549** 0MB APPROVAL 0MB Number: 3235-0123 Expires: Oct. 31, 2023 Estimated average burden hours per response: I 2 # **ANNUAL REPORTS FORM X-17A-S PART Ill** SEC rlLE NUMBER | | 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 01/01/2022 | | AND ENDING 12/31/2022 | | | | MM/DD/YY | | MM/DD/YY | | | A. REGISTRANT IDENTIFICATION | | | | | NAME oF FIRM: Anderson LeNeave & Co. | | | | TYPE OF REGISTRANT (check all applicable boxes):
[!) Broker-dealer
D Check here if respondent is also an OTC derivatives dealer | D Security-based swap dealer | D Major security-based swap participant | | | | ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use a P.O. box no.) | | | | 6805 Morrison Blvd., Suite 210 | | | | | | (No. and Street) | | | | Charlotte | NC | | 28211 | | (City) | (State) | | (Zip Code) | | PERSON TO CONTACT WITH REGARD TO THIS FILING | | | | | Greg LeNeave | 704-552-9212 | | gleneave@andersonleneave.com | | (Name) | (Area Code - Telephone Number) | (Email Address) | | | | B. ACCOUNTANT IDENTIFICATION | | | | Cherry Bekaert, LLC | INDEPENDENT PUBLIC ACCOUNTANT whose reports are contained in this filing* | | | | | (Name - if individual, state last, first, and middle name) | | | | 1111 Metropolitan Ave., Suite 900 | Charlotte | NC | 28204 | | (Address)
10/20/2003 | (City) | (State)
677 | (Zip Code) | | r·
of Regist,atioo with PCAOBl{if applicable) | FOR OFFICIAL USE ONL V | | (PCAOB Reglst,atioo N,mbec, if appllcabl•J | | | | | | | | • Claims for exemption from the requirement that t he annual reports be covered by the reports of an independent public
a ccountant must be supported by a statement of facts a nd c ircumstances r e lied 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, Gregory LeNeave , swear (or affirm) that, to the best of my knowledge and belief, the financial report pertaining to the firm of Anderson LeNeave & Co. as of 12/31 2~, 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_Picture_3.jpeg) # This filing\*\* contains (check all applicable boxes): - ~ (a) Statement of financial condition. - ~ (b) Notes to consolidated statement of financial condition. - D (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). - □ (d) Statement of cash flows. - □ (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. - □ (g) Notes to consolidated financial statements. - D (h) Computation of net capital under 17 CFR 240.1Sc3-1 or 17 CFR 240.18a-1, as applicable. - D (i) Computation of tangible net worth under 17 CFR 240.18a-2. - □ (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 t o 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 240.15c3-3. - □ (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. - D (o) Reconciliations, including appropriate explanations, of the FOCUS Report with computation of net capital or tangible net worth under 17 CFR 240.1Sc3-1, 17 CFR 240.18a-1, 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. - ~ (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. - D (r) Compliance report in accordance with 17 CFR 240.17a-5 or 17 CFR 240.lSa-7, as applicable. - □ (s) Exemption report in accordance with 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable. - **!;)a'** (t) Independent public accountant's report based on an examination of the statement of financial condition. - D (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.lSa-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. - D (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 material 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). □ (Z) Other:----- - - --- - --------------- ---- - - - --- - - - *"'\*To request confidential 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}------------------------------------------------ Financial Statements and Accompanying Information As of and for the Years Ended December 31, 2022 and 2021 {3}------------------------------------------------ #### Contents | Report oflndependent Registered Public Accounting Finn | 2 | |--------------------------------------------------------|---| | Statements of Financial Condition | 3 | | Notes to Financial Statements 4-8 | | | Accompanying Information | | # Page {4}------------------------------------------------ ![](_page_4_Picture_0.jpeg) # **Report of Independent Registered Public Accounting Firm** To the Stockholders Anderson LeNeave & Co. Charlotte, North Carolina #### **Opinion on the Financial Statements** We have audited the accompanying statements of financial condition of Anderson LeNeave & Co. (the "Company") as of December 31, 2022 and 2021 that is filed pursuant to Rule 17a-5 under the Securities Exchange Act of 1934. In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2022 and 2021, in conformity with generally accepted accounting principles 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 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 audits 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 audits 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 our audits provide a reasonable basis for our opinion. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. Rockville, Maryland February 6, 2023 hh.c.o 11 We have served as the Company's auditor since 2010. {5}------------------------------------------------ # Statements of Financial Condition #### **Assets** | | December 31,
2022 | December 31,
2021 | |--------------------------------------------------------|----------------------|----------------------| | Cash and cash equivalents | \$
182,621 | \$
182,457 | | Accounts receivable | | 10,000 | | Prepaid expenses and other assets | 6,712 | 20,075 | | Right-of-use asset | 156,219 | 225,650 | | Total assets | \$
345,552 | \$
438,182 | | Liabilities | | | | Lease Liability | \$
178,993 | \$
254,368 | | Total liabilities | \$
178,993 | \$
254,368 | | Stockholders' Equity | | | | Common stock, no par value, 100,000 shares authorized, | | | | 10,000 shares issued and outstanding | 81,066 | 81,066 | | Retained earnings | 85,493 | 102,748 | | Total stockholders' equity | 166,559 | 183,814 | | Total liabilities and stockholders' equity | \$
345,552 | \$
438,182 | The accompanying notes are an integral part of these statements. {6}------------------------------------------------ # Notes to Financial Statements December 31, 2022 and 2021 ## **Note 1** - **Nature of operations** Anderson LeNeave & Co. (the "Company"), a North Carolina corporation, is a full-service investment banking firm providing corporate finance services, including merger and acquisition advisory services and private financing placement and advisory services to middle market companies. The Company has elected to be registered as a broker-dealer, is a member of the Financial Industry Regulatory Authority (FINRA) and thus is subject to various rules and regulations promulgated by the Securities and Exchange Commission (SEC). Accordingly, the accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America as applicable to brokers and dealers in securities. # **Note 2** - **Summary of significant accounting policies** # **Use of estimates in the preparation of financial statements** 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. ## **Cash and Cash Equivalents** For purposes of the statement of cash flows, the Company considers all highly liquid financial instruments purchased with a maturity of three months or less to be cash equivalents. ## **Accounts receivable** Trade accounts receivable are stated net of an allowance for doubtful accounts. The allowance for credit losses is based on the Company's expectation of the collectability of fees utilizing the Current Expected Credit Losses (CECL) framework. The Company's expectation is that the credit risk associated with receivables due from client with which it conducts business are that the client will not fulfill its contractual obligation. Management monitors the credit risk of clients and currently there is not a foreseeable expectation of an event or change which could result in a fee receivable being unpaid based on individual facts and circumstances. The Company considers factors such as historical experience, credit quality, age of balances and current and future economic conditions that may affect the Company's expectation of the collectability in determining the allowance for credit losses. The Company has no allowance for credit losses as of the year ended December 31, 2022 or 2021. While management uses the best information available to make such evaluations, future adjustments to the allowance may be necessary if conditions differ substantially from the assumptions used in making the evaluations. The Company had fee receivables from clients as of December 31, 2022 and 2021 of zero and \$10,000, respectively. {7}------------------------------------------------ Notes to Financial Statements December 31 , 2022 and 2021 # **Note 2 - Summary of significant accounting policies (continued)** ## **Fee Revenue** Revenue recognition guidance requires that an entity recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance requires an entity to follow a five-step model to (a) identify the contract(s) with a customer, (b) identify the performance obligations in the contract, (c) determine the transaction price, (d) allocate the transaction price to the performance obligations in the contract, and (e) recognize revenue when ( or as) the entity satisfies a performance obligation. In determining the transaction price, an entity may include variable consideration only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized would not occur when the uncertainty associated with the variable consideration is resolved. The Company evaluated the new revenue recognition accounting standard and determined that the accounting standard did not require a change in the Company's revenue recognition practices. The Company provides advisory services on mergers and acquisitions (M&A) and private financing placementrelated advisory services. Revenue for advisory arrangements is generally recognized at the point in time that performance under the arrangement is completed (the closing date of the transaction) or the contract is cancelled. However, for certain contracts, revenue is recognized over time for advisory arrangements in which the performance obligations are simultaneously provided by the Company and consumed by the customer. In some circumstances, significant judgment is needed to determine the timing and measure of progress appropriate for revenue recognition under a specific contract. Retainers and other fees received from customers prior to recognizing revenue are reflected as contract liabilities. Other revenue relates primarily to billable transaction costs. Billable transaction costs include travel, other out-ofpocket expenses, reproduction and other transaction costs incurred by the Company that are billed to customers under the terms of agreements in place with those customers. These costs are expensed as incurred and billed in accordance with the agreed-upon terms. ## **Advertising** Advertising costs are expensed as incurred. ## **Income taxes** The Company has elected to be treated as an S Corporation for state and federal income tax purposes. As such, substantially all income of the Company is reported by the stockholder on his individual income tax returns. Accordingly, no provision for income taxes has been included in the accompanying financial statements. Management has evaluated the tax positions of the Company and it is the opinion of management that there are no uncertain tax positions that would be material to these financial statements. The Company did not incur any federal income tax expense in 2022 or 2021. {8}------------------------------------------------ ## **Notes to Financial Statements December 31, 2022 and 2021** ## **Note 2 - Summary of significant accounting policies (continued)** #### **Lease Accounting** The lease standard establishes a right-of-use model that requires a lessee to recognize a ROU asset and lease liability on the balance sheet for all leases with a term longer than 12 months. Leases will be classified as finance or operating, with classification affecting the pattern and classification of expense recognition on the income statement. Upon implementation of the lease standard, the Company elected the package of practical expedients permitted under the transition guidance within the new standard, which among other things, allowed us to carry forward the historical lease classification of those leases in place. The Company determines if an arrangement is a lease at inception. The operating lease agreements are primarily for office space and are included within operating lease right-of-use ("ROU") assets and lease liabilities on the balance sheet as of December 31, 2022 and 2021. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. Our variable lease payments consist of non-lease services related to the lease. Variable lease payments are excluded from the ROU assets and lease liabilities and are recognized in the period in which the obligation for those payments is incurred. As our lease do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. ROU assets also include any lease payments made and exclude lease incentives, if any. Rental expense for lease payments related to operating leases is recognized on a straight-line basis over the lease term. #### **Note 3** - **Property and equipment** Property and equipment at December 31 , consists of the following: | | 2022 | 2021 | |-------------------------------------|-----------|-----------| | Computer equipment | \$ 19,219 | \$ 19,219 | | Office furniture and equipment | 25,000 | 25,000 | | Computer software | 3,711 | 3,711 | | Total property and equipment, gross | 47,930 | 47,930 | | Less: Accumulated depreciation | (47,930) | (47,930) | | Total property and equipment, net | \$ | \$ | #### **Note 4 - Capital requirements** The Company is subject to the Securities and Exchange Commission's Uniform Net Capital Rule 15c3-1, which requires the maintenance of minimum net capital of \$5,000 and requires that the ratio of aggregate indebtedness to net capital, both as defined, shall not exceed 15 to I . Rule 15c3-**l** further requires that equity capital may not be withdrawn or cash dividends paid if the resulting net capital ratio would exceed 10 to 1. The net capital and net capital ratio, which agree with our Focus Report as of December 31, were as follows: | | 2022 | 2021 | |------------------------------------------------------|---------------|--------------| | Net capital | \$159,847 | \$153,738 | | Net capital ratio (ratio of indebtedness to capital) | Less than 1 % | Less than 1% | {9}------------------------------------------------ Notes to Financial Statements December 31, 2022 and 2021 # **Note 5** - Part I, **Form X-17a-5:** The most recent annual report of the Company is available for examination and copying at the office of the Company and at the Atlanta Regional Office of the Securities and Exchange Commission. # **Note 6** - **Profit sharing plan** Employees of the Company who are at least 21 years old and have completed one year of service are eligible to participate in the Anderson LeNeave & Co. Profit Sharing Plan (the "Plan"). The Plan allows the Company to make discretionary contributions on behalf of eligible employees ofup to 20% of each employee's compensation, subject to statutory limitations. The Company made discretionary contributions of \$134,000 and \$166,000 to the Plan for the years ended December 31 , 2022 and 2021, respectively. Participants vest in their portion of employer contributions over a three-year period. # **Note** 7 - **Operating Lease** On November I, 2019, the Company entered into a 65 month non-cancelable operating lease which expires on March 31, 2025. Rent expense consists of both operating lease expense from amortization of our ROU assets as well as variable lease expense which consists of non-lease components of office leases (i.e. common area maintenance). Total rent expense for the years ended December 31, 2022 and 2021 were \$82,851 and \$83,053. The weighted average interest rate used to determine the lease liability was 6.0% and the remaining term of the lease at December 31, 2022 was 27 months. As of December 31, 2022, the current portion of the lease liability was approximately \$85,879. Future minimum lease payments at December 31, 2022 are as follows: | Year | Amount | |-------|-----------| | 2023 | \$88,455 | | 2024 | 91,108 | | 2025 | 23,344 | | Total | \$202,907 | ## **Note 8** - **Concentration of credit risk** The Company places its cash and cash equivalents on deposit with a North Carolina financial institution. The balance at the financial institution is insured by the Federal Deposit Insurance Corporation ("FDIC") up to \$250,000. From time-to-time, the Company may have balances in excess of the FDIC insured limit. {10}------------------------------------------------ Notes to Financial Statements December 31, 2022 and 2021 # **Note 9- Contingencies and uncertainties/ COVID-19 Pandemic** On January 30, 2020, the World Health Organization declared the coronavirus "COVID-19" outbreak a "Public Health Emergency of International Concern" and on March 11, 2020, declared it to be a pandemic. Actions taken around the world to help mitigate the spread of COVID-19 include restrictions on travel, quarantines, or "stay-at-home" restrictions in certain areas and forced closures for certain types of public places and businesses. COVID-19 and actions taken to mitigate it have had and are expected to continue to have an adverse impact on the economies and financial markets globally, including the geographical areas in which the Company/Organization operates. While it is unknown how long these conditions will last and what the complete financial impact will be, the Company is closely monitoring the impact of the COVID-19 pandemic on all aspects of the business/operations and is unable at this time to predict the continued impact that COVID-19 will have on their business, financial position, and operating results in future periods due to numerous uncertainties. On February 3, 2021 the Company received a loan under the Paycheck Protection Program ("PPP Loan") for an amount of \$82,600, which was established under the Cares Act and administered by the Small Business Administration ("SBA"). The Company's loan forgiveness application was approved by its Bank and the SBA on August 12, 2021 in the full amount of the loan, plus accrued interest. As such the original principal amount of the loan has been recorded as other income as of December 31, 2021, but is not subject to taxation. #### **Note 10 - Subsequent Event** The Company has evaluated subsequent events through February **l,** 2023, in connection with the preparation of these financial statements which is the date the financial statements were available to be issued. Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.