# HALL & ROMKEMA FINANCIAL SERVICES, LLC X-17A-5 (2022-02-01) — Broker-dealer annual report - Company: HALL & ROMKEMA FINANCIAL SERVICES, LLC - Form: X-17A-5 - Filed: 2022-02-01 - Period: 2021-12-31 - Accession: 0001218185-22-000001 - CIK: 1218185 - File #: 8-65800 - Type: Broker-dealer - Material weakness: No - Auditor: Phillip V. George PLLC - Auditor location: Celeste, TX - Contact: Joe A. Romkema - Phone: 517-337-8900 - Email: jromkema@harcpa.com - Website: harcpa.com - Signed by: Joe A. Romkema (Member) Original filing: https://www.sec.gov/Archives/edgar/data/1218185/000121818522000001/2021auditreporthallromkema-.pdf --- {0}------------------------------------------------ OMB APPROVAL **UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549** | OMB Number: 3235-0123 | |---------------------------| | Expires:Oct. 31,
2023 | | Estimated average burden | | hours per response:
12 | ## **ANNUAL REPORTS FORM X-17A-5 PART III** | SEC FILE NUMBER | | |-----------------|--| | 8-65800 | | **FACING PAGE Information Required Pursuant to Rules 17a-5, 17a-12, and 18a-7 under the Securities Exchange Act of 1934** 01/01/2021 12/31/2021 FILING FOR THE PERIOD BEGINNING AND ENDING MM/DD/YY MM/DD/YY **A. REGISTRANT IDENTIFICATION** Hall & Romkema Financial Services, LLC NAME OF FIRM: TYPE OF REGISTRANT (check all applicable boxes): B Broker-dealer Security-based swap dealer Major security-based swap participant Check here if respondent is also an OTC derivatives dealer ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use a P.O. box no.) 3495 Coolidge (No. and Street) East Lansing Ml 48823 (City) (State) (Zip Code) PERSON TO CONTACT WITH REGARD TO THIS FILING Joe A. Romkema 517-337-8900 jromkema@harcpa.com (Name) (Area Code -Telephone Number) (Email Address) **B. ACCOUNTANT IDENTIFICATION** INDEPENDENT PUBLIC ACCOUNTANT whose reports are contained in this filing\* Phillip V. George, PLLC (Name -if individual, state last, first, and middle name) 5179 CR 1026 Celeste TX 75423 (Address) 02/24/2009 (City) (State) (Zip Code) 3366 (Date of Registration with PCAOB)(if applicable) (PCAOB Registration Number,if applicable) **FOR OFFICIAL USE ONLY** \* 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 circumstances 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 contained in this form are not required to respond unless the form displays a currently valid OMB control number. {1}------------------------------------------------ #### **OATH OR AFFIRMATION** I Joe A. Romkema , swear (or affirm) that, to the best of my knowledge and belief, the Hall & Romkema Financial Services, LLC , as of financial report pertaining to the firm of , 2 021 js true and correct. I further swear (or affirm) that neither the company nor any December 31 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. **TRESEA JACKSON NOTARY PUBLIC - STATE OF MICHIGAN COUNTY OF CLINTON** Signature; My Commission Expires December 25, 2023 Acting inthe County of InfyKflLm Title: Notary Public This filing\*\* contains (check all applicable boxes): - ( \* ] (a) Statement of financial condition. - (b) Notes to consolidated statement of financial condition. - B (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). - IX] (d) Statement of cash flows. - IX] (e) Statement of changes in stockholders' or partners' or sole proprietor's equity. - (f) Statement of changes in liabilities subordinated to claims of creditors. - Ixl (g) Notes to consolidated financial statements. - H (h) Computation of net capital under 17 CFR 240.15c3-lor 17 CFR 240.18a-l, as applicable. - (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. - (k) Computation for determination of security-based swap reserve requirements pursuant to Exhibit 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. - IX] (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. - Ixl (o) Reconciliations,including appropriate explanations, of the FOCUS Report with computation of net capital or tangible net worth under 17 CFR 240.15c3-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 240.17a-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 or 17 CFR 240.18a-7, as applicable. - X (s) Exemption report in accordance with 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable. - (t) Independent public accountant's report based on an examination of the statement of financial condition. - (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. - (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: lyiemb *\*\*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}------------------------------------------------ #### **HALL & ROMKEMA FINANCIAL SERVICES, LLC** #### **TABLE OF CONTENTS** | Report
Independent
Registered
Public
Accounting
Firm
Page
of | 1 | |-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------------| | Financial
Statements
Statement
of
Financial
Condition
Statement
of
Income
Statement
of
Changes
in
Members'
Equity
Statement
of
Flows
Cash
Notes
to
Financial
Statements | 2
3
4
5
6-8 | | 17a-5
Supplementary
Information
Pursuant
to
Rule | 9 | | Independent
Public
Report
of
Registered
Accounting
Firm | 10 | | Exemption
Report | 11 | {3}------------------------------------------------ # PHILLIP V. GEORGE, PLLC CERTIFIED PUBLIC ACCOUNTANT #### **REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM** To the Members Hall & Romkema Financial Services, LLC #### **Opinion on the Financial Statements** We have audited the accompanying statement of financial condition of Hall & Romkema Financial Services, LLC as of December 31, 2021, the related statements of income, changes in members' 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 Hall & Romkema Financial Services, LLC as of December 31, 2021, 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 Hall & Romkema Financial Services, LLC's management. Our responsibility is to express an opinion on Hall & Romkema Financial Services, 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 Hall & Romkema Financial Services, 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. #### **Auditor's Report on Supplemental Information** The supplemental information contained in Schedule I has been subjected to audit procedures performed in conjunction with the audit of Hall & Romkema Financial Services, LLC's financial statements. The supplemental information is the responsibility of Hall & Romkema Financial Sendees, 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 contained in Schedule I is fairly stated, in all material respects, in relation to the financial statements as a whole. PHILLIP V. GEORGE, PLLC We have served as Hall & Romkema Financial Services, LLC's auditor since 2017. Celeste, Texas January 24, 2022 {4}------------------------------------------------ ## **HALL & ROMKEMA FINANCIAL SERVICES, LLC Statement of Financial Condition December 31, 2021** | Assets | | |-------------------------------------------------------------|------------------------| | Cash
Cash
with
deposit
clearing
organization | \$
71,271
15,047 | | Advisory
fees
receivable
Prepaid
expenses | 222,290
19,473 | | Assets
Total | \$
328,081 | | Members'
Liabilities
and
Equity | | | Accounts
and
accrued
payable
expenses | \$
9,297 | | Total
Liabilities | 9,297 | | Members'
Equity | 318,784 | | Members'
Total
Liabilities
and
Equity | \$
328,081 | The accompanying notes are an integral part of these financial statements. {5}------------------------------------------------ ## **HALL & ROMKEMA FINANCIAL SERVICES, LLC Statement of Income For the Year Ended December 31, 2021** | Revenues | | |----------------------------------------------------------------|---------------| | fees
Advisory | \$
869,534 | | Other | 38,792 | | Total
Revenues | 908,326 | | Expenses | | | Contracted
services | 130,600 | | Clearing
charges | 38,794 | | Communications | 14,849 | | Professional
fees
and
services | 54,512 | | Occupancy
and
equipment | 6,624 | | fees
Regulatory | 9,151 | | Other
expenses | 11,068 | | Total
Expenses | 265,598 | | Net
Income
Before
Provision
for
Income
Taxes | 642,728 | | Current
Income
Taxes
State
- | 30,000 | | Net
Income | \$
612,728 | {6}------------------------------------------------ ## **HALL & ROMKEMA FINANCIAL SERVICES, LLC Statement of Changes in Members' Equity For the Year Ended December 31, 2021** | Balance
at
December
31,
2020 | \$
316,056 | |------------------------------------------|---------------| | income
Net | 612,728 | | Members'
distributions | (610,000) | | Balance
December
at
31,
2021 | \$
318,784 | {7}------------------------------------------------ ## **HALL & ROMKEMA FINANCIAL SERVICES, LLC Statement of Cash Flows For the Year Ended December 31, 2021** | Cash
Flows
from
Operating
Activities | | |--------------------------------------------------------------------------------------------------------------------|---------------| | Net
income | \$
612,728 | | to
reconcile
net
income
to
net
cash
Adjustments | | | activities:
provided
by
operating | | | Depreciation | 1,424 | | in
assets
and
liabilities
Changes
Increase
in
advisory
fees
receivable | (29,931) | | Increase
in
prepaid
expenses | (1,141) | | Increase
in
and
accrued
accounts
payable
expenses | 1,975 | | Net
cash
activities
provided
by
operating | 585,055 | | Flows
Cash
from
Investing
Activities | | | Purchase
office
of
equipment | (1,424) | | Net
cash
used
in
investing
activities | (1,424) | | Flows
Cash
from
Financing
Activities | | | Members'
distributions | (610,000) | | Net
cash
used
in
financing
activities | (610,000) | | Net
Decrease
in
Cash | (26,369) | | Cash,
Beginning
of
Year | 97,640 | | Cash,
End
Year
of | \$
71,271 | | Information:
Supplemental
Disclosures
of
Cash
Flow
for:
the
Cash
paid
during
year | | | Interest | \$ | | Income
taxes
state
- | \$
30,000 | The accompanying notes are an integral part of these financial statements. {8}------------------------------------------------ ## **HALL & ROMKEMA FINANCIAL SERVICES, LLC Notes to Financial Statements December 31, 2021** ### **Note A - Nature of Operations and Summary of Significant Accounting Policies:** #### **Nature of Operations** Hall & Romkema Financial Services, LLC (the Company), was organized in August 2002 as a Michigan limited liability company. The Company is a broker/dealer in securities registered with the Securities and Exchange Commission (SEC) and is a member of the Financial Industry Regulatory Authority (FINRA) and Securities Investor Protection Corporation (SIPC). The Company is also a registered investment advisor with the state of Michigan. The Company operates pursuant to section (k)(2)(ii) exemptive provisions of Rule 15c3-3 of the Securities Exchange Act of 1934, and accordingly, is exempt from the remaining provisions of that Rule. The Company, does not hold customer funds or securities, but as an introducing broker or dealer, will clear transactions on behalf of customers on a fully disclosed basis through a clearing broker/dealer. The clearing broker/dealer carries accounts of the customers and maintains and preserves all related books and records as are customarily kept by a clearing broker/dealer. The Company's operations consist primarily of providing investment advisory services to individuals located in Michigan. #### **Revenue Recognition** *Advisory fees.* The Company provides investment advisory services on a daily basis. The Company believes the performance obligation for providing advisory services is satisfied over time because the customer is receiving and consuming the benefits as they are provided by the Company. Fee arrangements are based on a percentage applied to the customer's assets under management. Fees are received quarterly in arrears. Fees are recognized as revenue monthly as they relate specifically to the services provided in that period, which are distinct from the services provided in other periods. *Other Revenue.* Other revenue consists of revenue earned related to customer accounts held at the clearing firm and is recorded on the trade date. #### **Fair Value of Financial Instruments** Substantially all the Company's financial asset and liability amounts reported in the Statement of Financial Condition are short term in nature and approximate fair value. #### **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. {9}------------------------------------------------ ## **HALL & ROMKEMA FINANCIAL SERVICES, LLC Notes to Financial Statements December 31, 2021** #### **Note A - Nature of Operations and Summary of Significant Accounting Policies (Continued):** #### **Income Taxes** The Company is treated as a partnership for federal income tax purposes. Consequently, federal income taxes are not payable by, or provided for, the Company. Members are taxed individually on their share of the Company's earnings. The Company's net income or loss is allocated among the members in accordance with their ownership interest in the Company. The Company is subject to state income taxes. The Company's federal and state income tax returns for 2018 through 2020 are subject to examination by the applicable tax authorities, generally for three years after the later of the original or extended due date. #### **Note B - Transactions with Clearing Broker/Dealer:** The Company has a clearing agreement with a national clearing broker/dealer to provide clearing, execution and other related services for its advisory service clients and accounts. The clearing agreement requires minimum monthly charges of \$1,000. The clearing agreement requires the Company to maintain a minimum of \$15,000 in an account with the clearing broker/dealer. #### **Note C - Related Party Transactions / Economic Dependency/ Concentration of Services:** The three members of the Company, who are also registered securities representatives and officers of the Company, generated substantially all of the Company's revenue for the year ended December 31, 2021. In lieu of compensation, the members received distributions totaling \$610,000 during the year. The Company is economically dependent upon the members due to the concentration of services provided by them. Two of the Company's members are also owners of Coolidge Road Leasing, Inc., an employee leasing company (the leasing company). The Company leases administrative staff from the leasing company. A total of \$130,600 was incurred and paid by the Company to the leasing company for the year ended December 31, 2021, which is recorded as contracted services in the accompanying Statement of Income. Two of the Company's members are also owners of Hall & Romkema PLC, a certified public accounting firm (the accounting firm). The accounting firm shares its office space with the Company. A total of \$6,624 was incurred and paid by the Company to the accounting firm for office usage and occupancy expenses for the year ended December 31, 2021. The Company incurred expenses for professional advisory, accounting, insurance and postage totaling \$24,202 provided by the accounting firm during the year ended December 31, 2021. These expenses are recorded as professional fees and services in the accompanying Statement of Income. In addition, the Company has a prepaid asset of \$4,486 related to insurance costs paid to the accounting firm at December 31, 2021. {10}------------------------------------------------ ## **HALL & ROMKEMA FINANCIAL SERVICES, LLC Notes to Financial Statements December 31, 2021** #### **Note D - Concentration of Credit Risk:** The Company has cash, commissions receivable, and a clearing deposit held by and due from its clearing broker-dealer totaling \$76,627, or approximately 23% of total assets, at December 31, 2021. The Company routinely assesses the financial strength of its customers and, as a consequence, believes that its advisory fees receivable credit risk exposure is limited. #### **Note E - Net Capital Requirements:** The Company is subject to the SEC Uniform Net Capital Rule (SEC Rule 15c3-1), which requires the maintenance of minimum net capital and requires that the ratio of aggregate indebtedness to net capital, both as defined, shall not exceed 15 to 1. Rule 15c3-1 also provides that equity capital may not be withdrawn or cash dividends paid if the resulting net capital ratio would exceed 10 to 1. At December 31, 2021, the Company had net capital of \$77,021, which was \$72,021 in excess of its net capital requirement of \$5,000. The Company's net capital ratio was 0.12 to 1. # **Note F - Off-Balance-Sheet Risk:** As discussed in Note A, the Company's customers' securities transactions are introduced on a fully disclosed basis with its clearing broker/dealer. The clearing broker/dealer carries the accounts of the customers of the Company and is responsible for execution, collection and payment of funds, and receipt and delivery of securities relative to customer transactions. Off-balance-sheet risk exists with respect to these transactions due to the possibility that customers may be unable to fulfill their contractual commitments wherein the clearing broker/dealer may charge any losses it incurs to the Company. The Company seeks to minimize this risk through procedures designed to monitor the credit worthiness of its customers and that customer transactions are executed properly by the clearing broker/dealer. #### **Note G - Statements of Changes in Liabilities Subordinated to Claims of General Creditors:** For the year ended December 31, 2021, the Company did not have any subordinated liabilities subject to claims of general creditors. Therefore, no statement is required. #### **Note H - Subsequent Events:** The Company has evaluated subsequent events through January 24, 2022 the date on which the financial statements were available to be issued. The Company made distributions to members totaling \$130,000 during January 2022. {11}------------------------------------------------ ## **Schedule I** ## **HALL & ROMKEMA FINANCIAL SERVICES, LLC Supplemental Informaiton Pursuant to Rule 17a-5 As of December 31, 2021** #### **Net Capital** | Total
members' equity
qualified
for
net
capital | \$ | 318,784 | |------------------------------------------------------------------------------------------------------------------------|-----------------|---------| | Deductions
and/or
charges
Non-allowable
assets: | | | | fees
receivable
Advisory | | 222,290 | | Prepaid
expenses | | 19,473 | | Total
deductions
and/or
charges | | 241,763 | | Net
Capital | \$ | 77,021 | | Aggregate
Indebtedness | | | | Items
Included
in
Statement
of
Financial
Condition
Accounts
payable and
accrued
expenses | \$ | 9,297 | | Total
Indebtedness
Aggregate | \$ | 9,297 | | Computation
of
Basic Net Capital
Requirement | | | | Minimum
Net
Capital
Required | \$ | 5,000 | | Excess
Net
Capital | \$ | 72,021 | | Ratio:
Aggregate
Indebtedness
to
Net
Capital | 0.12
to
1 | | | | | | #### **Reconciliation of Computation of Net Capital** The above computation does not differ from the computation of net capital under Rule 15c3-1 as of December 31, 2021 as filed by Hall & Romkema Financial Services, LLC on Form X-17A-5. Accordingly, no reconciliation is deemed necessary. #### **Statement Regarding the Reserve Requirements and Possession or Control Requirements** The Company operates pursuant to section (k)(2)(ii) exemptive provisions of Rule 15c3-3 of the Securities Exchange Act of 1934. Linder these exemptive provisions, the Computation for Determination of Reserve Requirements and Information Relating to the Possession and Control Requirements are not required. {12}------------------------------------------------ ## PHILLIP V. GEORGE, PLLC CERTIFIED PUBLIC ACCOUNTANT #### **REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM** To the Members Hall & Romkema Financial Services, LLC We have reviewed management's statements, included in the accompanying Exemption Report, in which ( 1 ) Hall & Romkema Financial Services, LLC identified the following provisions of 17 C.F.R. §15c3-3(k) under which Hall & Romkema Financial Services, LLC claimed the following exemption from 17 C.F.R. §240.15c3-3:(k)(2)(ii) (exemption provision) and (2) Hall & Romkema Financial Services, LLC stated that Hall & Romkema Financial Services, LLC met the identified exemption provision throughout the most recent fiscal year without exception. Hall & Romkema Financial Services, LLC's management is responsible for compliance with the exemption provision 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 Hall & Romkema Financial Services, 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'sstatements. 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, based on the provisions set forth in paragraph (k)(2)(ii) of Rule 15c3-3 under the Securities Exchange Act of 1934. PHILLIP V. GEORGE, PLLC Celeste, Texas January 24, 2022 {13}------------------------------------------------ # **Hall & Romkema Financial Services, LLC.** **3495 Coolidge / East Lansing, Ml 48823 517-337-8900** #### **Exemption Report** **Hall & Romkema Financial Services, 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)(l) and (4). To the best of its knowledge and belief, the Company states the following: (1) The Company claimed an exemption from 17 C.F.R. § 240.15c3-3 under the following provisions of 17 C.F.R. § 240.15c3-3 (k):(2)(ii). (2) The Company met the identified exemption provisions in 17 C.F.R. § 240.15c3-3(k) throughout the most recent fiscal year without exception. #### **Hall & Romkema Financial Services, LLC.** I,Joe A. Romkema,swear (or affirm) that, to my best knowledge and belief, this Exemption Report is true and correct. Joe A. Romkema, Member January 10, 2022 Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.