# FORUM CAPITAL SECURITIES LLC X-17A-5 (2021-02-25) — Broker-dealer annual report
- Company: FORUM CAPITAL SECURITIES LLC
- Form: X-17A-5
- Filed: 2021-02-25
- Period: 2020-12-31
- Accession: 0001143263-21-000001
- CIK: 1143263
- File #: 8-53364
- Material weakness: No
- Auditor: EisnerAmper LLP
- Auditor location: New York, NY
- Contact: Edward Cohen
- Phone: 2035576070
- Signed by: Jeffrey M. Stern (Managing Member)
Original filing: https://www.sec.gov/Archives/edgar/data/1143263/000114326321000001/public.pdf
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(A wholly — owned subsidiary of FOP Holdings LLC) (A wholly — owned subsidiary of FCP Holdings LLC)
# STATEMENT OF FINANCIAL CONDITION AND REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM STATEMENT OF FINANCIAL CONDITION AND REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
DECEMBER 31, 2020 DECEMBER 31, 2020
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UNITED STATES OMB APPROVAL SECURITIESANDEXCHANGE COMMISSION OMB Number: 3235-0123 Washington, D.C. 20549 Expires: August 31, 2020 UNITED STATES OMB APPROVAL SECURITIESANDEXCHANGE COMIVIISSION OMB Number: 3235-0123 Washington, D.C. 20549 Expires: August 31, 2020
Estimated average burden Estimated average burden
# ANNUAL AUDITED REPORT hours perresponse...... 12.00 F0:XR)'(I:1I I7IA-5 SEC FILE NUMBER ANNUAL AUDITED REPORT hours perresponse...... 12.00 Foil-(IR): 1II7IA-5 SEC FILE NUMBER
| 53364
8-
53364
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FACING PAGE FACING PAGE
Information Required of Brokers and Dealers Pursuant to Section 17 0f the Securities Exchange Act of 1934 and Rule 17a-5 Thereunder Information Required of Brokers and Dealers Pursuant to Section 17 of the Securities Exchange Act of 1934 and Rule 17a-5 Thereunder
| FOR
PERIOD
BEGINNING
REPORT
THE
BEGINNING
REPORT
FOR
THE
PERIOD | l01/2020
01
O1
/O1
IZOZO | ENDING
AND
1
AND
ENDING | 2/31
IZOZO
l2020
1
2/31 | |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------|------------------------------------------------------------------------|--|
| | MM/DD/YY
MM/DD/YY | | MM/DD/YY
MM/DD/YY | |
| A.
A. | IDENTIFICATION
IDENTIFICATION
REGISTRANT
REGISTRANT | | | |
| Forum
Forum
NAME
NAME
BROKER-DEALER:
BROKER-DEALER:
OF
OF | Capital
Securities
Securities
Capital | LLC
LLC | OFFICIAL
OFFICIAL
ONLY
ONLY
USE
USE | |
| PRINCIPAL
PO.
ADDRESS
PRINCIPAL
PLACE
PLACE
BUSINESS:
(Do
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Box
Box
No.)
No.)
ADDRESS
OF
OF
BUSINESS:
(Do
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OF
OF
P.O.
use | | | ID.
ID.
FIRM
NO.
NO.
FIRM | |
| 45th
45th
Street,
40th
40th
Floor
Floor
140
Street,
140
E
E | | | | |
| | (No.
(No.
and
Street)
Street)
and | | | |
| York
York
New
New | NY
NY | | 10017
10017 | |
| (City)
(City) | (State)
(State) | (Zip
(Zip | Code)
Code) | |
| NAME
NAME
AND
NUMBER
AND
TELEPHONE
TELEPHONE
NUMBER
OF
OF | IN
IN
CONTACT
CONTACT
PERSON
PERSON
TO
TO | REGARD
REGARD
THIS
THISREPORT
REPORT
TO
TO | | |
| Deborah
O'Dea
Deborah
O'Dea | | | (212)
290-1787
290-1787
(212) | |
| | | (Area
(Area | Number)
Telephone
Number)
Code
Code
Telephone
—
— | |
| B.
B. | IDENTIFICATION
ACCOUNTANT
IDENTIFICATION
ACCOUNTANT | | | |
| ACCOUNTANT
INDEPENDENT
INDEPENDENT
PUBLIC
PUBLIC
ACCOUNTANT | opinion
opinion
in
in
whose
contained
contained
this
Whose
is
is | this
Report*
Report* | | |
| EisnerAmper
EisnerAmper
LLP
LLP | | | | |
| | ifindividual,
last, first,
last, first, middle
ifindividual, state
(Name
state
(Name
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— | middle
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name) | | |
| Avenue
733
Avenue
733
3rd
3rd | York
New
York
New | NY
NY | 10017
10017 | |
| (Address)
(Address) | (City)
(City) | (State)
(State) | (Zip
(Zip
Code)
Code) | |
| CHECK
CHECK
ONE:
ONE: | | | | |
| /
0/
Certified
Certified
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Public
Accountant
Accountant | | | | |
| Public
Public
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| in
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| | | | | |
| | OFFICIAL
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OFFICIAL
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ONLY
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FOR
USE | | | |
\*Claimsfor exemptionfrom the requirement that the annual report be covered by the opinion ofan independentpublic accountant must be supported by a statement offacts and circumstances relied on as the basisfor the exemption. See Section 240.1 7a-5(e)(2) \*Claimsfor exemptionfrom the requirement that the annual report be covered by the opinion ofan independent public accountant must be supported by a statement offacts and circumstances relied on as the basisfor 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 notrequired to respond SEC 1410 ("'05) unless the form displays a currently valid OMB control number. Potential persons who are to respond to the collection of information contained in this form are not required to respond SEC 1410 ("'05) unless the form displays a currentlyvalid OMB control number.
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#### OATH 0R AFFIRMATION OATH OR AFFIRMATION
1, Jeffrey M- Stem ' ,swear (or affirm) that, to the best of my knowledge and belief the accompanying linancial statement and supporting schedules pertaining to the lirm 01 Forum Capital Securities LLC , as of December 31 , 20 1,0 ,are true and correct. I further swear (or affirm) that neither the company nor any partner, proprietor, principal officer or director has any proprietary interest in any account classified solely as that of a customer, except as follows: \_ /, 4...... 771mm: / I / Si'gnature Managing Member Title VALERIE CUTRUFELLI Notary Public Notary Public. State of New York . .No. 01 CU6059146 This report \*\* contains (check all applicable boxes): Qualified in New York 0'3"t 2'} (a) Facing Page. ' Commission Expires Mav21, 20...... 2| (b) Statement of Financial Condition. :1 (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). ((1) Statement of Changes 111 Financial Condition. (e) Statement of Changes In Stockholders Equity orPartners' or Sole Pr0p1ietors Capital. \_\_ (f) Statement of Changes in Liabilities Subordinated to Claims of Creditors. (g) Computation of Net Capital. E (h) Computation forDetermination of Reserve Requirements Pursuant to Rule 1503-3. \_ (i) Information Relating to the Possession or Control Requirements Under Rule 15c3-3 E] (j) A Reconciliation, including appropriate explanation ofthe Computation ofNet Capital Under Rule 1503 l and the Computation forDetermination of the Reserve Requirements Under Exhibit A of Rule 1503 3. [j (k) A Reconciliation between the audited and unaudited Statements of Financial. Condition with respect to methods of consolidation. (1) An Oath or Affirmation. I (m) A copy of the SIPC Supplemental Report. I] (n) A reportdescribing any material inadequacies found to exist or found to have existed since the date ofthe previous audit. 1, Jeffrey M. Stern ~ swear (or affirm) that, to the best of my knowledge and belief the accompanying linancial statement and supporting schedules pertaining to the lirm oi Forum Capital Securities LLC , as of December 31 , 20 2." , are true and correct. I further swear (or affirm) that neither the company nor any partner, proprietor, principal officer or director has any proprietary interest in any account classified solely as that ofa customer, except as follows: '/ /I 4(- / 5w / / Signature Managing Member Title Ugh/g [/L'6,,,,,[ {:ril/i fl ([0 k .VALERIE CUTRUFELLI Notary Public Notary Public. State of New York No. 01 CU6059146 This report \*\* contains (check all applicable boxes): Qualified in New York COMM-2 (a) Facing Page Commission Exoires May21, 20.. (b) Statement of Financial Condition. (c) Statement of Income (Loss) or. if there is othercomprehensive income in the period(s) presented, a Statement of Comprehensive Income (as defined in §210. 1-02 of Regulation S-X). (d) Statement of Changes in Financial Condition. (e) Statement of Changes in Stockholders' Equity or Partners' or Sole Proprietors' Capital. (f) Statement of Changes in Liabilities Subordinated to Claims of Creditors. (g) Computation of Net Capital. (h) Computation for Determination of Reserve Requirements Pursuant to Rule15c3-3. (i) Information Relating to the Possession 01 Contiol Requirements Under Rule 15c3-3. (j) A Reconciliation, including appropriate explanation ofthe Computation ofNet Capital Under Rule 15c3— l and the Computation for Determination of the Reserve Requirements Under Exhibit A of Rule 15c3-3 (k) A Reconciliation between the audited and unaudited Statements of Financial. Condition with respect to methods of consolidation. (1) An Oath or Affirmation. I (m) A copy of the SIPC Supplemental Rep01t. D(n) A report desc1ibing any material inadequacies found to exist 01 found to have existed sincethe date ofthe previous audit. El SUBBED] DIE
M0"or conditions of confidential treatment ofcertain portions ofthis filing, see section 240. 1 7151-5(3) (3). MFor conditions of confidential t1 earmant ofcertain portions ofthis fling, see section 240 17a-5(e)(3)
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(A wholly — owned subsidiary of FOP Holdings LLC) (A wholly — owned subsidiary of FCP Holdings LLC)
# CONTENTS CONTENTS
| REPORT
INDEPENDENT
REGISTERED
PUBLIC
PUBLIC
ACCOUNTING
ACCOUNTING
REPORT
OF
INDEPENDENT
REGISTERED
FIRM
FIRM
OF | | |
|--------------------------------------------------------------------------------------------------------------------------------------------------------|------------|--|
| Financial
Financial
Statement
Statement | | |
| Statement
of
of
Condition
Statement
Financial
Financial
Condition | | |
| the
the
Statement
Statement
of
ofFinancial
Condition
Notes
Notes
to
to
Financial
Condition | 3-7
3-7 | |
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# EISNERAMPER \$224313: EisnerAm er LLP EISNERAMPER
# REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Member of Forum Capital Securities LLC The Member of Forum Capital Securities LLC
# Opinion on the Financial Statement Opinion on the Financial Statement
We have audited the accompanying statement of financial condition of Forum Capital Securities LLC (the "Company") as of December 31, 2020 and the related notes (collectively referred to as the "financial statement"). In our opinion, the financial statement presents fairly, in all material respects, the financial position of the Company as of December 31, 2020, in conformity with accounting principles generally accepted in the United States of America. We have audited theaccompanying statement of financial condition of Forum Capital Securities LLC (the "Company") as of December 31, 2020 and the related notes (collectively referred to as the "financial statement"). In our opinion, the financial statement presents fairly, in all material respects, the financial position of the Company as of December 31, 2020, in conformity with accounting principles generally accepted in the United States of America.
#### Basis for Opinion 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 US. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. 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 thePublic Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the US. 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 conducted our audit in accordance withthe standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance aboutwhether 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.
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We have served as the Company's auditor since 2015. We have served as the Company's auditor since 2015.
EISNERAMPER LLP New York, New York February 24, 2021 EISNERAMPER LLP New York, New York February 24, 2021
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# (A wholly — ownedsubsidiary of FCP Holdings LLC) STATEMENT OF FINANCIAL CONDITION (A wholly — owned subsidiary of FCP Holdings LLC) STATEMENT OF FINANCIAL CONDITION
| December
December
2020
31,
31,
2020 | |
|--------------------------------------------------------------------------------------------------------|-----------------------------------|
| ASSETS
ASSETS | |
| Cash
Cash | 241,183
\$
241,183
\$ |
| Investment
Investment
banking
banking
fees
fees
receivable
receivable | 5,561,152
5,561
,152 |
| Right-of-use
asset
asset
Right-of—use | 120,495
120,495 |
| Other
Other
assets
assets | 19,756
19,756 |
| Total
Total
Assets
Assets | M
5,942,586
\$ |
| LIABILIITES
LIABILIITES
AND
AND
MEMBER'S
MEMBER'S
EQUITY
EQUITY | |
| Liabilities
Liabilities | |
| Accounts
Accounts
payable
and
accrued
accrued
expenses
expenses
payable
and | 62,219
\$
62,219
\$ |
| Lease
liability
Lease
liability | 120,495
120,495 |
| Total
Total
Liabilities
Liabilities | 182,714
182,714 |
| Commitment
Commitment | |
| Equity
Member's
Member's
Equity | "f
l
5,759,872
5,759,872 |
| Total
Total
Liabilities
Liabilities
and
Member's
Member's
Equity
Equity
and | 5,942,586
\$ |
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(A wholly — owned subsidiary of FOP Holdings LLC) NOTES TO THE STATEMENT OF FINANCIAL CONDITION December 31, 2020 (A wholly — owned subsidiary of FCP Holdings LLC) NOTES TO THE STATEMENT OF FINANCIAL CONDITION December 31, 2020
#### 1. Nature of business 1. Nature of business
Forum Capital Securities LLC (the "Company"), a wholly-owned subsidiary of FOP Holdings LLC (the "Parent"), is a broker-dealer registered with the Securities and Exchange Commission ("SEC") and is a member of the Financial Industry Regulatory Authority ("FlNRA"). The Company's business is primarily comprised of investment banking fees for private placement services, and strategic advisory services in connection with private placement of securities. Forum Capital Securities LLC (the "Company"), a wholly-owned subsidiary of FOP Holdings LLC (the "Parent"), is a broker-dealer registered with the Securities and Exchange Commission ("SEC") and is a member of the Financial Industry Regulatory Authority ("FINRA"). The Company's business is primarily comprised of investment banking fees for private placement services, and strategic advisory services in connection with private placement of securities.
# 2. Summary of significant accounting policies 2. Summary of significant accounting policies
# Basis of Presentation Basis of Presentation
The statement of financial condition has been prepared in conformity with accounting principles generally accepted in the United States of America ("GAAP"). The statement of financial condition has been prepared in conformity with accounting principles generally accepted in the United States of America ("GAAP").
# Revenue Recognition Revenue Recognition
The Company follows a single comprehensive model in accounting forrevenue arising from contracts with customers. The core principle of the revenue model is that an entity recognizes 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 forthose goods and services. The Company follows a single comprehensive modelin accounting for revenue arising from contracts with customers. The core principle of the revenue model is that an entity recognizes 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 and services.
The Company provides investment banking services and acts as the placement agent in connection with the private placement of securities to be issued by an investment company to any person or entity ("Investors"). The Company also provides strategic advisory services relating to private placement of securities. Revenue forplacement 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. For advisory services contracts relating to private placement of securities, revenue is recognized over time in which the performance obligations are simultaneously provided by the Company and consumed by the customer. In some circumstances, significantjudgment is needed to determine the timing and measure of progress appropriate forrevenue recognition under a specific contract. Retainers and other fees received from customers prior to recognizing revenue are reflected as contract liabilities. At December 31, 2020, there were no contract liabilities. The Company provides investment banking services and acts as the placement agent in connection with the private placement of securities to be issued by an investment company to any person or entity ("Investors"). The Company also provides strategic advisory services relating to private placement of securities. Revenue for placement 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. For advisory services contracts relating to private placement of securities, revenue is recognized over time 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 otherfees received from customers prior to recognizing revenue are reflected as contract liabilities. At December 31, 2020, there were no contract liabilities.
The Company acts as placement agent for various clients. Revenues are earned from success fees arising from the private placement of securities in which the Company acts as placement agent. Revenue is recognized on the trade date (the date on which there is a closing) for the portion of capital raised by the Company. The Company acts as placement agent for various clients. Revenues are earned from success fees arising from the private placement of securities in which the Company acts as placement agent. Revenue is recognized on the trade date (the date on which there is a closing) for the portion of capital raised by the Company.
The Company believes that the trade date is the appropriate point in time to recognize revenue for the private placement of securities as there are no significant actions which the Company needs to take subsequent to this date and the issuer obtains the control and benefit of the capital markets offering at that point. The Company believes that the trade date is the appropriate point in time to recognize revenue for the private placement of securities as there are no significant actions which the Company needs to take subsequent to this date and the issuer obtains the control and benefit of the capitalmarkets offering at that point.
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(A wholly — owned subsidiary of FCP Holdings LLC) NOTES TO THE STATEMENT OF FINANCIAL CONDITION December 31, 2020 (A wholly — owned subsidiary of FCP Holdings LLC) NOTES TO THE STATEMENT OF FINANCIAL CONDITION December 31, 2020
### 2. Summary of significant accounting policies (continued) 2. Summary of significant accounting policies (continued)
#### Credit Losses Credit Losses
In June 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-13, Financial Instruments — Credit Losses (Topic 326) — Measurement of Credit Losses on Financial Instruments ("ASU 2016-13"). ASU 2016-13 replaces the "incurred Ioss" credit losses framework with a new accounting standard that requires management's measurement of the current expected credit loss ("CECL") to be based on a broader range of reasonable and supportable information forlifetime credit loss estimates including historical experience, current conditions, and reasonable and supportable forecasts. Effective January 1, 2020, the Company's adoption of ASU 2016-13 did not have any impact to the statement of financial condition. In June 2016,the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-13, Financial Instruments — Credit Losses (Topic 326)— Measurement of Credit Losses onFinancial Instruments ("ASU 2016-13"). ASU 2016-13 replaces the "incurred loss" credit losses framework with a new accounting standard that requires management's measurement of the current expected credit loss ("CECL") to be based on a broader range of reasonable and supportable information for lifetime creditloss estimates including historical experience, current conditions, and reasonable and supportable forecasts. Effective January 1, 2020, the Company's adoption of ASU 2016-13 did not have any impact to the statement of financial condition.
#### Investment Banking Fees Receivable Investment Banking Fees Receivable
The Company's investment banking fees receivable primarily consist of private placement success fees that are carried at amortized cost and have a duration generally due within two years, as the Company has negotiated with certain clients the payment of investment banking fees over a period of approximately two years. The credit risk associated with fee receivables is that any financial institution with which it conducts business is unable to fulfill contractual obligations. The allowance forcredit losses is based on the Company's expectation of the collectability of such receivables utilizing the CECL framework. 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 forcredit losses. The Company's expectation is that the credit risk associated with fee receivables is not significant until they are 90 days past due based on the contractual arrangement. Management monitors the credit risk of clients, including historical experience, current conditions and reasonable and supportable forecasts and currently there is not a foreseeable expectation of an event or change which could result in the receivables being unpaid. The Company's investment banking fees receivable primarily consist of private placement success fees that are carried at amortized cost and have a duration generally due within two years, as the Company has negotiated with certain clients the payment of investment banking fees over a period of approximately two years. The credit risk associated with fee receivables is that any financial institution with which it conducts business is unable to fulfill contractual obligations. The allowance for credit losses is based on the Company's expectation of the collectability of such receivables utilizing the CECL framework. 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's expectation is that the credit risk associated with fee receivables is not significant until they are 90 days past due based on the contractual arrangement. Management monitors the credit risk of clients, including historical experience, current conditions and reasonable and supportable forecasts and currently there is not a foreseeable expectation of an event or change which could resultin the receivables being unpaid.
At December 31, 2020, included in investment banking fees receivable is approximately \$1,514,000, which is due over a period greater than one year. The Company reserves the right to charge interest on any fees scheduled to become due over a period greater than one year. During the year ended December 31, 2020, the Company did not charge any interest on long term receivables. At December 31, 2020, included in investment banking feesreceivable is approximately \$1,514,000, which is due over a period greater than one year. The Company reserves the right to charge interest on any fees scheduled to become due over a period greater than one year. During the year ended December 31, 2020, the Company did not charge any interest on long term receivables.
#### Lease Lease
The Company recognizes lease assets and liabilities on the balance sheet for all leases with terms longer than 12 months. The Company recognizes lease assets and liabilities on the balance sheet for all leases with terms longer than 12 months.
The Company determines if an arrangement is a lease, or contains a lease, at inception of a contract and when the terms of an existing contract are changed. The Parent is a lessee in a noncancelable operating lease for office space. On June 8, 2015, the Parent renewed its original lease term to commence on March 17, 2016 and end on The Company determines if an arrangement is a lease, or contains a lease, at inception of a contract and when the terms of an existing contract are changed. The Parent is a lessee in a noncancelable operating lease for office space. On June 8, 2015, the Parent renewed its original lease term to commence on March 17, 2016 andend on
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(A wholly — owned subsidiary of FCP Holdings LLC) NOTES TO THE STATEMENT OF FINANCIAL CONDITION December 31, 2020 (A wholly — owned subsidiary of FCP Holdings LLC) NOTES TO THE STATEMENT OF FINANCIAL CONDITION December 31, 2020
# 2. Summary of significant accounting policies (continued) 2. Summary of significant accounting policies (continued)
April 30, 2021. The monthly rent under this agreement is charged to the Company in accordance with a services agreement. As such, it has been determined by the Company that the services agreement contains an embedded lease. The Company recognized a lease liability and a right-of—use (ROU) asset at the adoption of new GAAP affecting the accounting forleases. The lease liability is initially and subsequently recognized based on the present value of its future lease payments. The discount rate is the implicit rate if it is readily determinable or otherwise the Company uses it incremental borrowing rate. The implicit rate of our lease is not readily determinable and accordingly, we use our incremental borrowing rate based on the information available at the commencement date for all leases. The Company's incremental borrowing rate fora lease is the rate of interest it would have to pay on a collateralized basis to borrow an amount equal to the lease payments under similar terms and in a similar economic environment. The ROU asset is subsequently measured throughout the lease term at the amount of the remeasured lease liability (i.e., present value of the remaining lease payment). April 30, 2021. The monthly rent under this agreement is charged to the Company in accordance with a services agreement. As such, ithas been determined by the Company that the services agreement contains anembedded lease. The Company recognized a lease liability and a right-of-use (ROU) asset at the adoption of new GAAP affecting the accounting for leases. The lease liability is initially and subsequently recognized based on the present value of its future lease payments. The discount rate is the implicit rate ifit is readily determinable or othen/vise the Company uses it incremental borrowing rate. The implicit rate of our lease is not readily determinable and accordingly, we use our incremental borrowing rate based on the information available at the commencement date for all leases. The Company's incremental borrowing rate for a lease is the rate of interest it would have to pay on a collateralized basis to borrow an amount equal to the lease payments under similar terms and in a similar economic environment. The ROU asset is subsequently measured throughout the lease term at the amount of the remeasured lease liability (i.e., present value of the remaining lease payment).
#### Income Taxes Income Taxes
The Company is a single member limited liability company, and treated as a disregarded entity for income tax reporting purposes. The Internal Revenue Code provides that any income or loss is passed through to the member for income tax purposes. The Company's parent is subject to the New York City Unincorporated Business Tax ("UBT"). As the liability associated with the UBT is principally the result of the operations of the Company, the UBT, which is calculated using currently enacted tax laws and rates, is recorded as an imputed expense or benefit. The Company is a single member limited liability company, and treated as a disregarded entity for income tax reporting purposes. The Internal Revenue Code provides that any income or loss is passed through to the member for income tax purposes. The Company's parent is subject to the New York City Unincorporated Business Tax ("UBT"). As the liability associated with the UBT is principally the resultof the operations of the Company, the UBT, which is calculated using currently enacted tax laws and rates, is recorded as an imputed expense or benefit.
At December 31, 2020, management has determined that the Company had no uncertain tax positions that would require financial statement recognition. This determination will always be subject to ongoing reevaluation as facts and circumstances may require. At December 31, 2020, management has determined that the Company had no uncertain tax positions that would require financial statement recognition. This determination will always besubject to ongoing reevaluation as facts and circumstances may require.
# Use of Estimates Use ofEstimates
The preparation of this financial statement 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 at the date of the financial statement. Actual results could differ from those estimates. The preparation of this financial statement 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 at the date of the financial statement. Actual results could differfrom those estimates.
# 3. Fair value of financial instruments 3. Fair value of financial instruments
Financial instruments including investment banking fees receivable (Level 2) are carried at amounts that approximate fair value due to generally negligible credit risk and short term nature. Financial instruments including investment banking fees receivable (Level 2) are carried at amounts that approximate fair value due to generally negligible credit risk and short term nature.
# 4. Regulatory requirement 4. Regulatory requirement
The Company is a member of FINRA, and is subject to the SEC Uniform Net Capital Rule 1503-1. This rule requires the maintenance of minimum net capital and that the ratio of aggregate indebtedness to net capital, both as defined, shall not exceed 15 to 1 and that equity capital may not be withdrawn if the resulting net capital ratio would exceed 10 to 1. At December 31, 2020, the Company's net capital was approximately \$179,000 which was approximately The Company is a member of FlNRA, and is subject to the SEC Uniform Net Capital Rule 1503-1. This rule requires the maintenance of minimum netcapital and that the ratio of aggregate indebtedness to net capital, both as defined, shall not exceed 15 to 1 and that equity capital may not be withdrawn ifthe resulting net capital ratio would exceed 10 to 1. At December 31, 2020, the Company's net capital was approximately \$179,000 which wasapproximately
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(A wholly — owned subsidiary of FOP Holdings LLC) NOTES TO THE STATEMENT OF FINANCIAL CONDITION December 31, 2020 (A wholly — owned subsidiary of FCP Holdings LLC) NOTES TO THE STATEMENT OF FINANCIAL CONDITION December 31, 2020
# 4. Regulatory requirement (continued) 4. Regulatory requirement (continued)
\$174,000 in excess of its minimum requirement of \$5,000. The Company's ratio of aggregate indebtedness to capital is 0.35 to 1. \$174,000 in excess of its minimum requirement of \$5,000. The Company's ratio of aggregate indebtedness to capital is 0.35 to 1.
# 5. Related party transactions 5. Related party transactions
Pursuant to a services agreement, the Parent provides various services on behalf of the Company. These include professional services, physical premises, utilities, the use of fixed assets, travel, insurance, subscriptions, taxes, personnel and other general and administrative services for which the Company pays the Parent. The Parent has charged substantially all of its expenses to the Company, as the Parent does not have any other operations. As of December 31, 2020, included in accounts payable and accrued expenses is \$30,206 due to Parent, as a result of amounts due relating to this agreement and the imputed New York City unincorporated business tax expense or benefit Pursuant to a services agreement, the Parent provides various services onbehalf of the Company. These include professional services, physical premises, utilities, the useof fixed assets, travel, insurance, subscriptions, taxes, personnel and other general and administrative services for which the Company pays the Parent. The Parent has charged substantially all of its expenses to the Company, as the Parent does not have any other operations. As of December 31, 2020, included in accounts payable and accrued expenses is \$30,206 due to Parent, as a result of amounts due relating to this agreement and the imputed New York City unincorporated business tax expense or benefit.
### 6. Concentrations 6. Concentrations
The Company periodically maintains significant cash balances in a single financial institution, which at times may exceed federally insured limits. Management does not anticipate any material losses as a result of this concentration. The Company periodically maintains significant cash balances in a single financial institution, which at times may exceed federally insured limits. Management does not anticipate any material losses as a result of this concentration.
For the year ended December 31, 2020, approximately 94.7% of revenues earned were from three customers. All of investment banking fees receivable at December 31, 2020 are from fivecustomers. For the year ended December 31, 2020, approximately 94.7% of revenues earned were from three customers. All of investment banking fees receivable at December 31, 2020 are from five customers.
# 7. Defined Benefit Retirement Plan 7. Defined Benefit Retirement Plan
The Parent maintained a defined benefit retirement plan to cover all employees. The Parent terminated and distributed all of the plan assets in 2020. The Parent maintained a defined benefit retirement plan to cover all employees. The Parent terminated and distributed all of the planassets in 2020.
# 8. Profit Sharing 401(k) Plan 8. Profit Sharing 401(k) Plan
The Parent maintains a defined contribution retirement plan under Internal Revenue Code Section 401(k). Employees are eligible to contribute a specified percentage of their salary, not to exceed the statutory limit, to the plan. The Parent made employer contributions for the Company on behalf of its employees to the plan in accordance with the plan document. Such amount is included in the services agreement. The Parent maintains a defined contribution retirement plan under Internal Revenue Code Section 401(k). Employees are eligible to contribute a specified percentage of their salary, not to exceed the statutory limit, to the plan. The Parent made employer contributions for the Company on behalf ofits employees to the planin accordance with the plan document. Such amount is included in the services agreement.
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(A wholly — owned subsidiary of FOP Holdings LLC) NOTES TO THE STATEMENT OF FINANCIAL CONDITION December 31, 2020 (A wholly — owned subsidiary of FCP Holdings LLC) NOTES TO THE STATEMENT OF FINANCIAL CONDITION December 31, 2020
### 9. Commitments 9. Commitments
The Parent has obligations as a lessee for office space with initial noncancelable terms in excess of one year which is considered an embedded lease forthe Company. The Company classified this lease as an operating lease. The Company's lease does not include termination options for either party to the lease or restrictive financial or other covenants. Payments due under the lease contracts include fixed payments plus variable payments for the Parent's proportionate share of the building's property taxes, insurance, and common area maintenance. These variable lease payments are not included in lease payments used to determine lease liability and are recognized as variable costs when incurred. The Parent has obligations as a lessee for office space with initial noncancelable terms in excess of one year which is considered an embedded lease for the Company. The Company classified this lease as an operating lease. The Company's lease does not include termination options for either party to the lease or restrictive financial or other covenants. Payments due under the lease contracts include fixed payments plus variable payments for the Parent's proportionate share of the building's property taxes, insurance, and common area maintenance. These variable lease payments are not included in lease payments used to determine lease liability and are recognized as variable costs when incurred.
As of December 31, 2020, future minimum lease rental payments are payable as follows: As of December 31, 2020, future minimum lease rental payments are payable as follows:
| Undiscounted
Undiscounted
lease
payments
payments
lease | | |
|------------------------------------------------------------------------|----------|--------------------|
| April
April
30,
30,
2021
2021 | \$
\$ | 120,870
120,870 |
| Less:
Less:
imputed
imputed
interest
interest | \$
\$ | (375)
(375) |
| lease
liability
liability
Total
Total
lease | \$
\$ | 120,495
120,495 |
The discount rate used to calculate the present value of its future lease payments to recognize lease liability was 2.488%. The discount rate used to calculate the present value of its future lease payments to recognize lease liability was 2.488%.
#### 10. Risk 10. Risk
The extent of the impact of the coronavirus ("COVlD-19") outbreak on the financial performance of the Company will depend on future developments, including the duration and spread of the outbreak, related advisories and restrictions, and the impact of COVD-19 on the financial markets and the overall economy, all of which are highly uncertain and cannot be predicted. If the financial markets and/or the overall economy are impacted foran extended period of time, the Company's financial condition may be materially adversely affected. The extent of the impact of the coronavirus ("COVlD-19") outbreak on the financial performance of the Company will depend on future developments, including the duration and spread of the outbreak, related advisories and restrictions, and the impactofCOVD-19 on the financial markets andthe overall economy, allof which are highly uncertain and cannot be predicted. If the financial markets and/or the overall economy are impacted for an extended period of time, the Company's financial condition may be materially adversely affected.
#### 11. Subsequent Events 11. Subsequent Events
Subsequent events have been evaluated through February 24, 2021, which is the date the financial statements were available to be issued, and no additional events have been identified which require identification. Subsequent events have been evaluated through February 24, 2021, which is the date the financial statements were available to be issued, and no additional events have been identified which require identification.
Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.