# ANICO FINANCIAL SERVICES, INC. X-17A-5 (2020-03-03) — Broker-dealer annual report - Company: ANICO FINANCIAL SERVICES, INC. - Form: X-17A-5 - Filed: 2020-03-03 - Accession: 0001193125-20-060133 - CIK: 1527877 - File #: 8-68938 Original filing: https://www.sec.gov/Archives/edgar/data/1527877/000119312520060133/d852767dfull.pdf --- {0}------------------------------------------------ ## **ANICO Financial Services, Inc.** Report of Independent Registered Public Accounting Firm Statement of Financial Condition December31, 2019 and 2018 {1}------------------------------------------------ UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 OMB APPROVAL OMB Number: 3235-0123 Expires: August 31,2020 Estimated average burden hours perresponse ...... 12.00 ### **ANNUAL AUDITED REPORT FORM X-17A-5 PART Ill** | SEC FILE NUMBER | |-----------------| | 8-68938 | FACING PAGE Information Required of Brokers and Dealers Pursuant to Section 17 of the Securities Exchange Act of 1934 and Rule 17a-5 Thereunder | REPORT FOR THE PERIOD BEGINNING | | January 1, 2019 | AND ENDING | December 31,2019 | | | |---------------------------------------------------------------------------------------------|----------|-------------------------------------------------------|------------|--------------------------------|-------------------|--| | | | MM/00/YY | | MM/00/YY | | | | | | A. REGISTRANT IDENTIFICATION | | | | | | NAME oF BROKER-DEALER: ANICO Financial Services, Inc. | | | | | OFFICIAL USE ONLY | | | ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use P.O. Box No.) | | | | FIRM J.D. NO. | | | | One Moody Plaza, Suite 1469 | | | | | | | | | | (No. and Street) | | | | | | Galveston, TX 77550-7999 | | | | | | | | (City) | | (State) | | (Zip Code) | | | | NAME AND TELEPHONE NUMBER OF PERSON TO CONTACT IN REGARD TO THIS REPORT
Suzanne Saunders | | | | | 281-521-3469 | | | | | | | (Area Code - Telephone Number) | | | | | | B. ACCOUNT ANT IDENTIFICATION | | | | | | INDEPENDENT PUBLIC ACCOUNTANT whose opinion is contained in this Report• | BKD, LLP | | | | | | | | | (Name - if individual, state last,flrst, middle name) | | | | | | 2700 Post Oak Boulevard, Ste. 1500 | | Houston | TX | | 77056 | | | (Address) | (City) | | (State) | | (Zip Code) | | | CHECK O NE: | | | | | | | | []]certified Public Accountant | | | | | | | | Public Accountant | | | | | | | | B
Accountant not resident in United States or any of its possessions. | | | | | | | | | | | | | | | | | | FOR OFFICIAL USE ONLY | | | | | | | | | | | | | | | | | | | | | *•ctaimsfor exemption/rom the requirement that the annual report be covered by the opinion of an independent public accountant must be supported by a statement of facts and circumstances relied on as the basis for the exemption. See Section 240.1 7a-5(e)(2)* > Potential 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 OMB control number. SEC 1410 (11 -05) {2}------------------------------------------------ #### **OATH OR AFFIRMATION** #### Suzanne Saunders I,---- ------------- ------------' swear (or affirm) that, to the best of my knowledge and belief the accompanying financial statement and supporting schedules pertaining to the firm of ANICO Financial Services, Inc. ----------------------------------------------------------------------------------------- , as of December 31 20 19 --------------------------------------~ 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: CFO Title ,,,,,.,,.,,,,, MICHELE S. LORD ~... ~ ... !~.':." .. ,, [!;':.A~·{~~ Notary Public. State of Texas ~.-,.· ..• ~./;>§ Comm. Expires 02·28·2020 -:,1'~; ••.• **f,. ... '** '''·~~~f..~,,,,•' Notary 10 483836 Notary Public This report\*\* contains (check all applicable boxes): [;1] (a) Facing Page. II] (b) Statement of Financial Condition. 0 (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). **n** (d) Statement of Changes in Financial Condition. D (e) Statement of Changes in Stockholders' Equity or Partners' or Sole Proprietors' Capital. 0 (t) Statement of Changes in Liabilities Subordinated to Claims of Creditors. § (g) Computation ofNet Capital. (h) Computation for Determination of Reserve Requirements Pursuant to Rule 15e3-3. (i) Information Relating to the Possession or Control Requirements Under Rule 15e3-3. 0 G) A Reconc iliation, including appropriate explanation ofthe Computation ofNet Capital Under Rule 15c3-l and the D (k) Computation for Determination of the Reserve Requirements Under Exhibit A of Rule I 5e3-3. A Reconciliation between the audited and unaudited Statements of Financial Condition with respect to methods of consolidation. (I) An Oath or Affirmation. (m) A copy of the SIPC Supplemental Report. (n) A report describing any material inadequacies found to exist or found to have existed since the date of the previous audit. *\*\*For conditions of confidential treatment of certain p ortions of this filing. see section 240.1 7a-5(e)(3).* {3}------------------------------------------------ # ANICO Financial Services, Inc. December 31, 2019 and 2018 ### Contents | Report of Independent Registered Public Accounting Firm 1 | | |------------------------------------------------------------|--| | Financial Statements | | | Statements of Financial Condition 2 | | | Notes to Financial Statements 3 | | {4}------------------------------------------------ ![](_page_4_Picture_0.jpeg) ### **Report of Independent Registered Public Accounting Firm** Board of Directors ANJCO Financial Services, l nc. League City, Texas #### *Opinion on the Financial Statements* We have audited the accompanying statements of financial condition of ANlCO Financial Services, Inc. (the Company) as of December 31, 20 19 and 2018, including 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 ofthe Company as of December 31 , 2019 and 2018, in conformity with accounting principles generally accepted in the United States of America. #### *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 petforming 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 supporting 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 financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. **BKD, LLP** We have served as the Company's Auditor since 2012. Houston, Texas February 18, 2020 ![](_page_4_Picture_13.jpeg) {5}------------------------------------------------ ## **ANICO Financial Services, Inc. Statements of Financial Condition December 31, 2019 and 2018** | 2019 | | 2018 | | |-------------------------------------------------------|----|----------|---------------| | Assets | | | | | Cash | \$ | 239,497 | \$
222,675 | | Receivables due from parent for: | | | | | Variable commissions | | 554 | 209 | | Expenses reimbursement | | 20,633 | 29,987 | | Prepaid and other assets | | 5,518 | 5,714 | | Receivable from parent in lieu of income taxes | | | 34,785 | | Total assets | \$ | 266,202 | \$
293,370 | | Liabilities and Stockholder's Equity | | | | | Liabilities | | | | | Due to dealers for commissions | \$ | 554 | \$
209 | | Due to parent for: | | | | | Service fees | | 13,682 | 13,840 | | Trade payables and accrued expenses | | 1,900 | 29,255 | | Total liabilities | | 16,136 | 43,304 | | Stockholder's equity | | | | | Common stock, par value \$0.01 per share; authorized, | | | | | issued and outstanding, 100,000 shares | | 1,000 | 1,000 | | Additional paid-in-capital | | 319,000 | 319,000 | | Retained deficit | | (69,934) | (69,934) | | Total stockholder's equity | | 250,066 | 250,066 | | Total liabilities and stockholder's equity | \$ | 266,202 | \$
293,370 | | | | | | {6}------------------------------------------------ ## **ANICO Financial Services, Inc. Notes to Financial Statements December 31, 2019 and 2018** ### **Note 1: Nature of Operations and Summary of Significant Accounting Policies** ### **Nature of Operations** ANICO Financial Services, Inc. ("ANFS" or "the Company"), is a wholly owned subsidiary of American National Lnsurance Company ("American National"). ANFS was organized on December 21, 2010, and its sole purpose is to operate as a wholesale broker-dealer and distributor of American National's variable products. ANFS is registered as a wholesale broker-dealer under the *Securities Exchange Act of 1934* and received approval from the Financial lndustry Regulatory Authority, Inc. (FINRA), as a registered wholesale broker-dealer on July 18, 2012. ANFS does not receive cash from customers and, therefore, is not required to maintain a "Special Reserve Account for the Exclusive Benefit of Customers." ANFS operates pursuant to the (k)( l) limited business (mutual funds and/or variable annuities only) exemptive provision of the Securities and Exchange Commission's (SEC) Rule 15c3-3. The Securities Investor Protection Corporation (SIPC) was created by *the Securities Investor Protection Act of 1970,* (SIP A), a Federal statute which became effective December 30, 1970. Membership with Sl PC is required by all brokers and dealers registered under Section IS (b) of the *Securities Exchange Act of 1934* unless otherwise exempted. For the years ending December 3 1, 20 18 and 2017, ANFS filed a Certificate of Exclusion of Membership under Section 78ccc(a)(2)(A)(ii) of SIP A. The exclusion is determined by ANFS' exclusive business consisting of: (I) the sale of variable annuities and (2) the business of insurance. ### **Use of Estimates** The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities 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** At December 31, 20 19 and 2018, the Company's cash accounts did not exceed federally insured I imits. {7}------------------------------------------------ ## **ANICO Financial Services, Inc. Notes to Financial Statements December 31, 2019 and 2018** ### **Income Taxes** ANFS accounts for income taxes in accordance with income tax accounting guidance (Accounting Standards Codification 740, *Income Taxes).* The income tax accounting guidance results in two components of income tax expense: current and deferred. Current income tax expense reflects taxes to be paid or refunded for the current period by applying the provisions of the enacted tax law to the taxable income or excess of deductions over revenues. ANFS determines deferred income taxes using the liability (or balance sheet) method. Under this method, the net deferred tax asset or liability is based on the tax effects of the differences between the book and tax bases of assets and liabilities, and enacted changes in tax rates and laws are recognized in the period in which they occur. Deferred tax assets are reduced by a valuation allowance if, based on the weight of evidence available, it is more-likely-than-not that some portion or all of a deferred tax asset will not be realized. As of December 31, 2019 and 2018, ANFS did not have any transactions that resulted in deferred taxes. ANFS files consolidated income tax returns with American National. ### **Note 2: Transactions With Affiliates** ANFS and American National are parties to a service and expense-sharing agreement and a distribution and administrative services agreement. Pursuant to such agreements, ANFS has agreed to act as wholesale distributor of certain variable life insurance and annuity products issued by American National. ### **Note 3: Net Capital Requirement** *ln* accordance with the regulations of the SEC, ANFS must maintain minimum net capital and a ratio of aggregate indebtedness to net capital, both as defined, that does not exceed 8 to I. At December 31 , 2019, ANFS had net capital of\$223,915, which was \$218,915 in excess of its required net capital of \$5,000. ANFS's ratio of aggregate indebtedness to net capital was 0.0721 to I. At December 31,2018, ANFS had net capital of \$ 179,580, which was \$174,580 in excess of its required net capital of\$5,000. ANFS's ratio of aggregate indebtedness to net capital was 0.2411 to I. ### **Note 4: Subsequent Events** Subsequent events have been evaluated through February 18, 2020, which is the date the financial statements were issued. Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.