# PARKMAN WHALING SECURITIES LLC X-17A-5 (2023-02-28) — Broker-dealer annual report - Company: PARKMAN WHALING SECURITIES LLC - Form: X-17A-5 - Filed: 2023-02-28 - Period: 2022-12-31 - Accession: 0001172571-23-000002 - CIK: 1413492 - File #: 8-67723 - Type: Broker-dealer - Material weakness: No - Auditor: Harper & Pearson Company, P.C. - Auditor location: Houston, TX - Contact: Thomas Hensley - Phone: 713-333-8400 - Email: thensley@parkmanwhaling.com - Website: parkmanwhaling.com - Signed by: Thomas Hensley (Chief Financial Officer) Original filing: https://www.sec.gov/Archives/edgar/data/1413492/000117257123000002/2022auditreportparkman-.pdf --- {0}------------------------------------------------ #### **UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549** # **ANNUAL REPORTS FORM X-17A-5 PART III** | SEC FILE NUMBER | | |-----------------|--| | 8-67723 | | #### **FACING PAGE** | FILING FOR THE PERIOD BEGINNING | 1/01/2022 | AND ENDING | 12/31/2022 | | |--------------------------------------------------------------------------------|------------------------------------------------|---------------------|-----------------|--------------------------------------------| | | °
MM/DD/YY | | MM/DD/YY | | | | A. REGISTRANT IDENTIFICATION | | | | | Parkman
Whaling
of
firm:
name | Securities
LLC | | | | | TYPE OF REGISTRANT (check all applicable | boxes): | | | | | XI Broker-dealer
Check here if respondent is also an OTC derivatives dealer | Security-based swap dealer
Major | security-based swap | | participant | | ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use a P.O. box no.) | | | | | | 600
Travis
Street,
Suite
600 | | | | | | | (No. and Street) | | | | | Houston | TX | | | 77002 | | (City) | (State) | | | (ZipCode) | | PERSON TO CONTACT WITH REGARD TO THIS FILING | | | | | | Thomas
Hensley | 713-333-8400 | | | thensley@parkmanwhaling.com | | (Name) | (Area Code -Telephone Number) | | (Email Address) | | | | B. ACCOUNTANT IDENTIFICATION | | | | | INDEPENDENT PUBLIC ACCOUNTANT whose reports | are contained in | this
filing* | | | | &
Pearson
Company,
Harper | P.C. | | | | | | individual, state ast, first, and middle name) | | | | | | | | IX | | | (Name-if | | | | 77056 | | Riverway,
One
STE
1900
(Address) | Houston | | | | | 10/14/2003 | (City) | | (State)
431 | (ZipCode) | | (Date of Registration with PCAOB)(if applicable) | | | | (PCAOB Registration Number, if applicable) | \* Claims for exemption from the requirement that the annual reports be covered by the reports of an independent public accountant must be supported by a statement of facts and ciicumstances relied on as the basis of the exemption. See 17 CFR 240.17a-5(e)(l)(ii), if applicable. Persons who are to respond to the collection of information containedinthis form are not required to respond unless the form displays a currently valid OMB control number. {1}------------------------------------------------ #### OATH OR AFFIRMATION | I, | Thomas
Hensley
swear (or affirm) that,
to
the best of my knowledge and
belief, the | |-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------| | | Parkman
Whaling
Securities
LLC
financial report pertaining
to
the firm
of
,
as of
,j\$
December
31
2 022
Ifurther
true and correct.
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. | | | | | | | | | | | | | | | | | | | | | This filing**
contains (cheek all
applicable boxes): | | K | (a) Statement of financial condition. | | | (b) Notes to
consolidated statement of financial condition. | | ® | (c) Statement of income (loss) or, if there
is other comprehensive income in the
period(s) presented, a statement of | | | comprehensive income (as defined in § 210.1-02 of Regulation S-X). | | X | (d) Statement of cash flows. | | X) | (e) Statement of changes in stockholders'
or partners' or sole proprietor's equity. | | (X | (f) Statement
of changes in liabilities
subordinated to claims of
creditors. | | (X) | (g) Notes to consolidated
financial statements. | | X) | (h) Computation of net capital under
17 CFR 240.15c3-l or 17 CFR 240.18a-l, as applicable. | | | (i) Computation of tangible net worth under
17 CFR 240.183-2. | | | (j) Computation for determination of customer
reserve requirements pursuant to
Exhibit A to 17 CFR 240 15c3-3. | | | (k) Computation for determination of
security-based swap reserve requirements pursuant toExhibit
B to
17 CFR 240.15c3-3 or
Exhibit A to
17 CFR 240.18a-4, as applicable | | | (I) Computation for Determination of PAB Requirements under
Exhibit A to § 240.15c3-3. | | XI | (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. | | XI | (o) Reconciliations, including appropriate
explanations, of the FOCUS Report with computation of
net capital or tangible net | | | worth under 17
CFR 24O.15c3-l, 17 CFR 240.18a-l, or 17 CFR 240.18a-2, as
applicable, and the reserve requirements under 17 | | | CFR 240.15c3-3 or 17 CFR 240.18a-4, as applicable, if material
differences exist, or a statement that no material
differences
exist. | | | (p) Summary of financial data for subsidiaries
not consolidated in
the statement of financial
condition. | | XI | (q) Oath or affirmation in
accordance with 17 CFR 24O.17a-5, 17 CFR 240.17a-12, or 17
CFR 240.18a-7, as applicable. | | | (r) Compliance report in accordance with
17 CFR 240.17a-5 cr 17 CFR 240.18a-7, as applicable. | | X | (s) Exemption report in accordance
with 17 CFR 240.17a-5 or 17 CFR 24O.18a-7,
as applicable. | | | (t) Independent
public accountant's report based on an examination of the statement
of financial condition. | | XI | (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 24O.17a-12, as applicable. | | | (v) Independent public accountant's report based on an examination
of certain statements in the compliance report
under 17
CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable. | | XI | (w) Independent public accountant's report
based on a review of the exemption report
under 17 CFR 240.17a-5 or 17 | | | CFR 240.18a-7, as applicable.
(x) Supplemental reports on applying agreed-upon procedures, in
accordance with 17
CFR 240.15c3-le or 17 CFR 240.17a-12, | | | as applicable. | | | (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}------------------------------------------------ ## PARKMAN WHALING SECURITIES LLC FINANCIAL STATEMENTS DECEMBER 31, 2022 {3}------------------------------------------------ ## CONTENTS Page | Report of
Independent
Registered Public
Accounting Firm | 2 | |---------------------------------------------------------------------------------------------------|-----| | Balance Sheet | 3 | | Statement
of
Operations and
Member's Equity | 4 | | Statement
of
Cash Flows | 5 | | Notes to
Financial Statements | 6-8 | | Schedule 1 | 9 | | Schedule II | 10 | | of
Independent
Registered Public Accounting Firm and
11-12
Report
Exemption Report | | {4}------------------------------------------------ ![](_page_4_Picture_0.jpeg) ## **REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM** To the Board of Directors of Parkman Whaling Securities LLC #### **Opinion on the Financial Statements** We have audited the accompanying balance sheet of Parkman Whaling Securities LLC as of December 31, 2022, the related statements of operations and member's equity, and cash flows for the year then ended, and the related notes (collectively referred to as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of Parkman Whaling Securities LLC as of December 31, 2022, and the results of its operations and its cash flows for the year then ended in conformity with accounting principles generally accepted in the United States of America. #### **Basis for Opinion** These financial statements are the responsibility of Parkman Whaling Securities LLC's management. Our responsibility is to express an opinion on Parkman Whaling Securities LLC's 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 Parkman Whaling Securities LLC 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. #### **Auditors Report on Supplemental Information** The Computation of Net Capital Under Rule 15c3-l of the Securities Exchange Commission and the Computation for Determination of Reserve Requirements and Information Relating to Possession or Control of Securities Under Rule 15c3-3 of the Securities Exchange Commission have been subjected to audit procedures performed in conjunction with the audit of Parkman Whaling Securities LLC's financial statements. The supplemental information is the responsibility of Parkman Whaling Securities LLC's management. Our audit procedures included determining whether the supplemental information reconciles to the financial statements or the underlying accounting and other records, as applicable, and performing procedures to test the completeness and accuracy of the information presented in the supplemental information. In forming our opinion on the supplemental information, we evaluated whether the supplemental information, including its form and content, is presented in conformity with 17 C.F.R. §240.17a-5. In our opinion, the supplemental information is fairly stated, in all material respects, in relation to the financial statements as a whole. HARPER & PEARSON COMPANY, P.C. We have served as Parkman Whaling Securities LLC's auditor since 2008. Houston, Texas February 27, 2023 ## **harperpearson.com** {5}------------------------------------------------ #### **ASSETS** | Cash and
cash equivalents
Prepaid expenses -
other | \$
531,984
7,091 | |-------------------------------------------------------------|--------------------------| | TOTAL ASSETS | \$
539,075 | | AIO
LIABILITIES
MEMBERS EQUITY | | | Accounts payable
equity
Member's | \$
401,222
137,853 | | TOTAL LIABILITIES AND MEMBER'S EQUITY | \$
539,075 | See accompanying notes. {6}------------------------------------------------ REVENUES: | Investment
banking revenue | \$ 1,089,924 | |-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------| | EXPENSES: | | | administrative
-
Office and
services fee
Member
-
Office license fee
Member
Professional fees
Registration
fees
Other administrative
fees | 1,155,760
172,840
70,663
14,023
1,339 | | TOTAL EXPENSES | 1,414,625 | | NET LOSS | (324,701) | | beginning of
Member's
equity,
year | 35,954 | | Capital Contributions | 426,600 | | Member's
equity,
end
of
year | \$
137,853 | See accompanying notes. {7}------------------------------------------------ | CASH FLOWS FROM OPERATING ACTIVITIES
Cash received from
customers
Cash paid
for
administrative
fees and
expenses
Net cash provided
by
operating
activities | 1,089,924
\$
(621,228)
\$
468,696 | |---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------------------------| | CASH FLOWS FROM FINANCING ACTIVITIES
Contribution
from
Member
Net cash provided
by
financing activities | 30,000
30,000 | | NET INCREASE IN
CASH AND CASH EQUIVALENTS | 498,696 | | AT BEGINNING OF YEAR
CASH AND CASH EQUIVALENTS | 33,288 | | AT END OF YEAR
CASH AND CASH EQUIVALENTS | 531,984
\$ | | RECONCILIATION OF NET LOSS TO NET CASH PROVIDED BY
OPERATING ACTIVITIES
Net loss
Non-cash member
contributions | (324,701)
\$
396,600 | | Change in
operating
assets and
liabilities:
Decrease in
prepaid
expenses
in
Increase
accounts payable | 278
396,519 | | Net cash provided
by
operating
activities | 468,696
\$ | See accompanying notes. {8}------------------------------------------------ ## Note 1 BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES #### 1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Parkman Whaling Securities LLC (the "Company") is a Texas limited liability company, formed on June 19, 2008. The Company is located in Houston, Texas and is a wholly-owned subsidiary of Parkman Whaling LLC (the "Member"). The Company's revenues are derived primarily from advisory services. The Company is a registered broker-dealer with the Securities and Exchange Commission and is a member of Financial Industry Regulatory Authority (FINRA). The Company is considered "Non-Covered Firm" exempt from 17 C.F.R. § 240.15c3-3 and is filing an Exemption Report relying on footnote 74 to SEC Release 34-70073, and as discussed in Q&A 8 of the related FAQ issued by the SEC staff. The following is a summary of significant accounting policies consistently followed by the Company. Revenue Recognition - Revenue from contracts with customers includes fees from investment banking services. The recognition and measurement of revenue is based on the assessment of individual contract terms. Significant judgment is required to determine whether performance obligations are satisfied at a point in time or over time; how to allocate transaction prices where multiple performance obligations are identified; when to recognze revenue based on the appropriate measure of the Company's progress under the contract; anc whether constraints on variable consideration should be applied due to uncertain future events. The Company earns fees in exchange for the services it provides and recognizes revenue when the Company has completed its contractual obligations and collection is reasonably assured. Estimates - The preparation of accrual basis financial statements in conformity with accounting principles generally accepted in the United States of America (GAAP) requires the Company 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. Statement Presentation - The unclassified balance sheet is presented in accordance with industry standards. Cash and Cash Equivalents -The Company considers all highly liquid debt instruments with an original maturity of three months or less to be cash equivalents. Income Taxes - The Company's income, losses, and tax credits will be included in the income tax return of the Member. Accordingly, the Company does not record a provision for federal income taxes. Texas margin tax is accrued and included as a component of management fee and administrative expense. For the year ended December 31, 2022, the Company had no margin tax expense. The Company believes that all significant tax positions utilized by the Company will more likely than not be sustained upon examination. As of December 31, 2022, the tax years that remain subject to examination by the major tax jurisdictions under the statute of limitations are from the year 2019 forward (with limited exceptions). Tax penalties and interest, if any, would be accrued as incurred and would be classified as tax expenses in the statement of income and member's equity. {9}------------------------------------------------ #### 2. AGREEMENTS AND COMMITMENTS The Company entered into an office and administrative services agreement with Parkman Whaling LLC whereby Parkman Whaling LLC provides administrative and operational services, facilities, furniture and pays overhead expenses of the Company. The Company also entered into an office license agreement to utilize office space for a monthly rent allocation of \$5,650 for the period of January through April and \$18,780 for the period of May through December 2022. Office and administrative services and office license fees for 2022 were \$1,328,600. Parkman Whaling LLC contributed capital to the Company in the amount of \$426,600, comprised of cash of \$30,000 and \$396,600 of offset fees charged by Parkman Whaling LLC related to office administrative and operational services and office license fees during the year ended December 31, 2022. ## 3. NET CAPITAL REQUIREMENTS Pursuant to the net capital provisions of Rule 15c3-l of the Securities Exchange Act of 1934, the Company is required to maintain a minimum net capital, as defined under such provisions. Net capital and the related net capital ratio may fluctuate daily. At December 31, 2022 the Company had net capital of \$130,761 and a net capital requirement of \$26,748. The Company's ratio of aggregate indebtedness to net capital was 3 to 1 at December 31, 2022. The Securities and Exchange Commission permits a ratio of aggregate indebtedness to net capital for the Company of no greater than 15 to 1. ### 4. CONCENTRATIONS AND CREDIT RISK The Company's demand bank account balance, which was \$531,984 at December 31, 2022, is insured by the Federal Deposit Insurance Corporation (FDIC) up to \$250,000. It is the Company's practice to utilize high net worth financial institutions to minimize its credit risk. Generally, no collateral or other security is required to support trade receivables. During 2022, the Company's investment banking revenue was from one customer. {10}------------------------------------------------ ## 5. SUBSEQUENT EVENTS The Company has evaluated subsequent events through February 27, 2023, the date the financial statements were available to be issued. No subsequent events occurred, which require adjustment or disclosure to the financial statements at December 31, 2022. {11}------------------------------------------------ ## **PARKMAN WHALING SECURITIES LLC SCHEDULEI COMPUTATION OF NET CAPITAL UNDER RULE 15C3-1 OF THE SECURITIES Ah® EXCHANGE COMMISSION DECEMBER 31, 2022** | NET CAPITAL
Total
net
member's
equity qualified
for
capital | \$
137,853 | |---------------------------------------------------------------------------------------------------------------------------------------------|---------------| | Deductions and/or
charges
Nonallowable assets:
Prepaid expenses | 7,092 | | Net capital | 130,761 | | COMPUTATION OF BASIC NET CAPITAL REQUIREMENTS
(6
Minimum net
capital required
of
total
aggregate
2/3%
indebtedness) | 26,748 | | Minimum dollar net
capital requirement | 5,000 | | Net capital requirement
(greater
of
above two
minimum
requirement
amounts) | \$
26,748 | | Excess net
capital | \$
104,013 | | net
Ratio: Aggregate indebtedness to
capital | 1
3 to | Note: The above computation does not differ materially from the computation of net capital under Rule 15c3-l as of December 31, 2022, filed with the Securities and Exchange Commission by the Company on Part HA of Form X-17a-5. See report of independent registered public accounting firm. {12}------------------------------------------------ ### **PARKMAN WHALING SECURITIES LLC SCHEDULE II COMPUTATION FOR DETERMINATION OF RESERVE REQUIREMENTS AND INFORMATION RELATING TO POSSESSION OR CONTROL OF SECURITIES UNDER RULE 15C3-3 OF THE SECURITIES AND EXCHANGE COMMISSION DECEMBER 31, 2022** #### Exemption Provisions The Company is considered "Non-Covered Firm" exempt from 17 C.F.R. § 240.15c3-3 and is filing an Exemption Report relying on footnote 74 to SEC Release 34-70073, and as discussed in Q&A 8 of the related FAQ issued by the SEC staff. The Company limits its business activities exclusively to: (1) private placements of securities (including private investment in public equity transactions that will be handled on a best-efforts basis); (2) mergers and strategic advisory transactions, valuation advisory, fairness opinions, general strategic advice, and advice to the public and private entities and individuals on the purchase/sale of assets for cash or securities; and (3) recapitalization and reorganization advisory assignments. See report of independent registered public accounting firm. {13}------------------------------------------------ ![](_page_13_Picture_0.jpeg) ### **REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM** To the Board of Directors of Parkman Whaling Securities LLC We have reviewed management's statements, included in the accompanying Exemption Report, in which (1) Parkman Whaling Securities LLC did not identify exemptive provisions to 17 C.F.R. §15c3-3(k) under which Parkman Whaling Securities LLC claimed an exemption during the year ended December 31, 2022 (2) Parkman Whaling Securities LLC stated that Parkman Whaling Securities LLC met the requirements that they (A) did not directly or indirectly receive, hold, or otherwise owe funds or securities for or to customers; (B) did not carry accounts of or for customers; and (C) did not carry PAB accounts throughout the most recent fiscal year without exception. Parkman Whaling Securities LLC's management is responsible for compliance with the exemption provisions and its statements. Our review was conducted in accordance with the standards of the Public Company Accounting Oversight Board (United States) and, accordingly, included inquiries and other required procedures to obtain evidence about Parkman Whaling Securities LLC's compliance with the exemption provisions. A review is substantially less in scope than an examination, the objective of which is the expression of an opinion on management's statements. Accordingly, we do not express such an opinion. Based on our review, we are not aware of any material modifications that should be made to management's statements referred to above for them to be fairly stated, in all material respects. HARPER & PEARSON COMPANY, P.C. Houston, Texas February 27, 2023 {14}------------------------------------------------ # **Parkman Whaling Securities LLC** **600 Travis Street, Suite 600 / Houston, Texas 77002 713-333-8400** ## **Exemption Report** **Parkman Whaling Securities LLC** (the "Company') is a registered broker-dealer subject to Rule 17a-5 promulgated by the Securities and Exchange Commission (17 C.F.R. §240.17a-5, "Reports to be made by certain brokers and dealers"). This Exemption Report was prepared as required by 17 C.F.R. § 240.17a-5(d)(1) and (4). To the best of its knowledge and belief, the Company states the following: (1) The Company does not claim an exempton under paragraph (k) of 17 C.F.R. § 240. 15c3-3, and (2) The Company is considered "Non-Covered Firm" exempt from 17 C.F.R. § 240.15c3-3, and is filing an Exemption Report relying on footnote 74 to SEC Release 34-70073, and as discussed in Q&A 8 of the related FAQ issued by the SEC staff. The Company limits its business activities exclusively to: (1) private placements of securities (including private investment in public equity transactions that will be handled on a best-efforts basis; (2) mergers and strategic advisory transactions, valuation advisory, fairness opinions, general strategic advice, and advice to the public and private entities and individuals on the purchase/sale of assets for cash or securities; and (3) recapitalization and reorganization advisory assignments. (3) The Company (1) did not directly or indirectly receive, hold, or otherwise owe funds or securities for or to customers, other than money or other consideration received and promptly transmitted in compliance with paragraph (a) or (b)(2) of Rule 15c2-4; (2) did not carry accounts of or for customers; and (3) did not carry PAB accounts (as defined in Rule 15c3-3), throughout the most recent fiscal year without exception. ## **Parkman Whaling Securities LLC** I, Thomas Hensley, swear (or affirm) that, to my best knowledge and belief, this Exemption Report is true and correct. Thomas Hensley, Chief Financial Officer February 27, 2023 Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.