# MADISON PARK GROUP LLC X-17A-5 (2022-03-01) — Broker-dealer annual report

- Company: MADISON PARK GROUP LLC
- Form: X-17A-5
- Filed: 2022-03-01
- Period: 2021-12-31
- Accession: 0001218186-22-000002
- CIK: 1218186
- File #: 8-65801
- Type: Broker-dealer
- Material weakness: No
- Auditor: Mazars USA LLP
- Auditor location: New York, NY
- Contact: Noubar Pechdimaljian
- Phone: 2126609712
- Email: noubar@madisonparkgrp.com
- Website: madisonparkgrp.com
- Signed by: Noubar Pechdimaljian (Managing Director)

Original filing: https://www.sec.gov/Archives/edgar/data/1218186/000121818622000002/MPG_shortaudit2021.pdf

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## **Madison Park GroupLLC**

Statement of Financjal Condition December 31, 2021

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OMB APPROVAL UNITED STATES OMB Number: 3235-0123 SECURITIES AND EXCHANGE COMMISSION Expires: Oct. 31, 2023 Washington, D.C. 20549 Estimated average burden hours per response: 12 ANNUAL REPORTS SEC FILE NUMBER FORM X-17A-5 8-65801 PART III FACING PAGE Information Required Pursuant to Rules 17a-5, 17a-12, and 18a-7 under the Securities Exchange Act of 1934 FILING FOR THE PERIOD BEGINNING 01/01/21 12/61/21 AND ENDING MM/DD/YY MM/DD/YY A. REGISTRANT IDENTIFICATION NAME OF FIRM: MADISON PARK GROUP LLC TYPE OF REGISTRANT (check all applicable boxes): 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.) 3 PARK AVE 31ST FL (No. and Street) NEW YORK NY 10016 (City) (State) (Zip Code) PERSON TO CONTACT WITH REGARD TO THIS FILING Noubar Pechdimaljian 212-6609712 noubar@madisonparkgrp.com (Name) (Area Code - Telephone Number) (Email Address) B. ACCOUNTANT IDENTIFICATION INDEPENDENT PUBLIC ACCOUNTANT whose reports are contained in this filing\* Mazars USA LI P (Name - if individual, state last, first, and middle name) 135 W 50th St New York NY 10020 (Address) (City) (State) (Zip Code) 10/08/2003 339 (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 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)(1)(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.

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#### **OATH OR AFFIRMATION**

| I, Nouba(Pe~dimaljiiJit     | swear {or affirm) that, to the best of my knowledge and belief, the                                                                                                                                                                                                                                                                                           |                                      |
|-----------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------|
|                             | 2~<br>financial report pertaining to the firm of Madison Park Group LLC<br>·<br>·                                                                                                                                                                                                                                                                             | as of                                |
| ·12/31<br>·                 | is true and correct. I further swear (or affirm) that neither the company nor any                                                                                                                                                                                                                                                                             |                                      |
| as that ofa.customer.<br>", | partner, officer, director; 6i' equivalent person, as the case may _be, has any proprietaryinterest in any account classified solely<br>CHRISTOPH.ER J. FINE<br>State of New York<br>Notary Public -<br>_a---7<br>Reg. #01 Fl6380826<br>Qualified in N,ewYork County . Srgnatu~r~<br>c/<br>· Commission E;~1res September 17; 202 .<br>.,<br>-<br>ntle:<br>·. | ,,,/]<br>< ~?<br>;•<br>• /<br>,<br>, |

#### **This filing\*\* contains (check:all appli**

- Iii!! (a) Statement of financial c~hd" ion
- Iii!! (b) Notes to consolidated statement of financial condition.
- · D (c) Statement of income (ioss) 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 S0X). .
- Cl (d) Statement of cash flows.
- □ (e)Statement of changes in stockholders' or partners' or sole proprietor's equity.
- D (f) Statement of changes in.liabilities subordinated to claims of.creditors.
- □ (g) Notes to consolida.ted financial statements.
- D · ( h) Computation of net capital under 17 CFR 240.15c3-1 or 17 CFR 240 .. 18a-1, .as applicable.
- □ (i) Computation oftangible networth under 17CFR 240.18a-2.
- □ U) Computation for determination of customer reserve requirements pursuant to Exhibit A to 17 CFR 240.15c3~3.
- □ (k) Computation for determination of secu rity-ba\$ed SW<!P reserve requirements pursuant to Exhibit B to 17 CFR 240.lSc:3-3 or ExhibitA to 17 CFR 240.18a-4, as applicable;
- □ (I) Computation for Determination ofPAB Requirements under Exhibit A to§ 240.15<::3-3.
- □ (m) Information relating to possession or control requirements for customers under 17 CFR 2.40.15c3~3.
- D (n) .. lnformation relatingfo possession or control requirements for security-based swap customers under i7 CFR 240.15c3-3(p)(2) or 17 CFR 240.18a-4, as applicable.
- □ (o) Reconciliations,. including appropriate explanations, of the FOCUS Report with .computation of net capital or tangibie net worth under i:7 CFR 24Ci:15c3-1, 17 .CFR 240.18a-1, or 17 CFR240,18a-2, as applicable, and the reserve. requirements under 17 CFR 240. lSi:3-3 or 17 CFR 240.18a-4, as applicable, if matedal 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.
- Iii!! (q) Oath or affirmation in accordance with 17 CFR240.17a0 s; 17 CFR 240.17a-12, orl7CFR 240.18ac7, as applicable.
- D (r) Compliance report in accordance with 17 CFR 240.17a-5 or 17 CFR 240.18a~7, as appUcable.
- □ (s) Exemption report in accordance with 17 CFR240.17a-5 or 17 CFff240:18a-7; as appljcable.
- ii (t) lrideperideritpublic accountant's report based on an examination of the statement oHinancial condition.
- D {u) In.dependent public; accountant's r!:!port based on an examination.of the fin<'!ncial report orfinanda! statements under 17 CFR 240.17a-5, 17 CFR240.18a-71 or 17 CFR 240,17a-12, as applicable.
- □ (v) Independent public accountant's report based oh.an examination oftertain statements in the compliance report u.nder 17 CFR.240.17a-5 or 17 (:FR 240.18as7;. as applicable.
- □ (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 240.1Sc3-1eor 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 materia 1 inadequacies exist, under 17 CFR240:17a-l2(k). □ (z) Other: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ \_
- 
- \*\*To. request *confidential treatment of. certain portions* of this *filing; see* 17 *CFR240.17a*05(e}(3) *or 17 CFR 2'10.18acl{d)(2),* as . . applicable.

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# **mazars** Mazars USA LLP

135 West 50th Street New York, New York 10020

### Tel: 212.812.7000

### **Report of Independent Registered Public Accounting Firm** www.mazars.us

**To the Managing Member of Madison Park Group LLC** 

#### **Opinion on the Financial Statement**

We have audited the accompanying statement of financial condition of Madison Park Group LLC, (the "Company"), as of December 31, 2021, and the related notes (collectively referred to as the "financial statement"). In our opinion, the statement of financial condition presents fairly, in all material respects, the financial position of the Company, as of December 31 , 2021 , in conformity with accounting principles generally accepted in the United States of America.

#### **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 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 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 have served as the Company's auditor since 2004.

New York. NY February 25, 2022

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| Report of Independent Registered Public Accounting Firm |                                  |  |
|---------------------------------------------------------|----------------------------------|--|
|                                                         | Financial Statement              |  |
|                                                         | Statement of Financial Condition |  |
|                                                         | Notes to Financial Statement     |  |

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| Assets                                                   |                             |
|----------------------------------------------------------|-----------------------------|
| Cash                                                     | \$<br>1,986,982             |
| Accounts receivable                                      | 530,000                     |
| Fixed assets, net of accumulated depreciation of\$24tO38 |                             |
| Lease right of use asset•.                               | 913,195                     |
| Otlter assets                                            | I 10,635                    |
| Total assets                                             | \$<br>3 540 812<br>' .<br>' |
| Liabilities and Member's Equity                          |                             |
| Liabilities                                              |                             |
| Accounts payable and accrued expenses                    | \$<br>579,148               |
| Due to member                                            | l,011                       |
| Lease liabilities                                        | 1,002;788                   |
| Total liabilities                                        | 1,582,947                   |
| Commitment                                               |                             |
| Member's equity                                          |                             |
| Member's equity.                                         | 1,957;865                   |
| Total liabilities and member's equity                    | \$<br>3,540,812             |

· The accompanying notes are an integral part. of this financial statement.

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#### 1. **Business**

Madison Park Group LLC (the "Company") is registered as a broker-dealer \.Vith the Securities and Exchange Commission C'SECi'). The Company is a member of the Firia11eial Jndustry Regulatory . Authority ("FINRA") and is involved in the sale of securities for its clients by providing investment banking services and financial advisory and capital-raising services, principally related to mergers and acquisitions advice and eqµity private placements.

The Company does not hold funds or securities for, nor o\ves any money or securities to. customers, and .does not carry accounts. *qfor* forc:ustomers. Accordingly.the Company does not claim an exemption from SEC Rule 1 ScJ-3, but rather relying on Footnote 74 of the SEC Release No. 34.:.70073 adopting amendments fo 17·C.F;R. §240-l 7a-S .

. A member <>fa limited liability company is not perso11ally I iable for the debts, obligations or other liabilities ofthe limited liability company by reason of being·such a member; ·

#### **2. Summary of Sig11ificantAccounting Policies**

#### **Lease.**

The Cdinpa1iy recognizes and measures its . leases in accordance with F ASB ASC 842, Leases. The Company is a lessee in a non-cancellable operating lease for office spac·e; The Company determines if an arrnng¢m~nt is a lease, or contains a lease\_, at inception of a contract and when the terms of an existing contract are changed. The lease liability is initially and subsequently i:ecognized based on the present value of its future lease payinents. The discount ~te is the implicit rate. if it is readily determinable or otherwise the Company uses • its incremental borrowing rate, The iniplicit rates of our leases are not readily determinable and accordingly, we use our incremental borro\ving rate based 011 the information avail~ble 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 ti:::nns and in a similar economic envirornnent. The Right-of-use ("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 payments), less the.unammti?ed balance of lease incentives received. Lease cost for lease payments is recognized on a straight-line basis over the lease term.

#### **Revenue and Expense Refogriition**

The Company recognizes revenue in accordance ,vith Ase Topic 606, Revenue from Contracts with Customers. Investment banking transaction fees recorded in consulting revenue are recorded when the underlying transaction is consummated. Consulting income also consists of the Compariy receiving advisory fees for specific projects aild preparation work ahead. of a transaction that are recordecl in the month that the services are provided. · · ·

#### **Incl)me Taxes** .

As a single member limited liability company, the Company does: not incur any liability for federal or state income taxes because all income; deductions and credits are reportable by its member.

#### **Use of Estimates**

---------.. --.. ·-··················--

The preparation of finantialstatements in conformity with accounting principles generally accepted in the United States· of America requires. management to make estimates and assumptio1~s that affect the reported amounts of assets and liabilities and disclosure .. of contingent assets and liabilities atthe date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results coulcl differ from these estimates: · ·

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#### **Accounts Receivable**

The Compatiy follov,,s ASC Topic 326, Financial [nstruments - Credit Losses ("ASC 326"). ASC :326 impacts the impairment model for ce1tain financial assets by requiring a curre1it expected credit loss (''CECL11) methodology to estimate· expected credit losses civer the entire life of the financial asset Under .the accounting ASC, the Company has the ability to determine that there are no expected .credit losses in certain circumstances (e.g., based on the credit qua] ity of the .customer). The Company identified accounts receivables ils impacted by Ase 326. The Company provides for doubtful accoi:mts when the collectiori of an account is doubtful. The accounts receivables as of December 31, 2021,are consi~ered fully collectible and therefore no allowance for . doubtful ~ccounts was considered necessary. There were, no accounts receivable as of December 31, 2020.

#### **Fixed Assets**

Fixed assets are recorded at cost and are depreciated or amortized under the straight-line method over the estimated useful lives of the assets. ·

#### **Concentration of Risk** - **Cash**

The Company maintains.its cash balances ii1 one major financial institution ,vhich; at times, inay exceed the \$250,000 federallysfasured **li.mit.** On December 31, 2021, cash exceeded the federally insured limits by \$1,736,982 .

#### **Market Risk**

Political developments, n;itural disasters; publi\_c health crises and other events outside of the Conipany's control cah adversely, directly and indirectly, impactthe Company and its affiHates in material respe~ts: While the Company 'is riot aware ofany events that would result in an immediate impact to the daysto-day operations; the Company continues to monitor developments on the global spread of COVID-19 as additional information is obtained.

#### **3. Major Customers**

For the year ended December 31, 2021, three customers accounted for approximately 66% of the total transaction fee revenues.

#### **4. Due to.Member**

Dueto member consists of reimbursement of operating expenses paid on behalf ofthe Company.

#### **5. Fixed Assets**

A summary of the cost ahd accumttlated depreciation of fixed assets at December 31., 2021, is as follows:

|                               |            | Estimated<br>Useful Lives |
|-------------------------------|------------|---------------------------|
| Furniture and fixtures        | \$ 105,577 | 5 years                   |
| J,,easehold improvements      | 127,768    | 5years                    |
| Equipment                     | 9 693      | IO years                  |
|                               | 243,038    |                           |
| Less accumuJated depreciation | ·243,038   |                           |
| Property and :equipmeht, net  |            |                           |

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#### **6. Cmnmitment and Contingencies**

#### **Operating** Lease

In October 2016, the Company, with an entity under common ownership, entered into a lease agreementto rent office \$pace in .3 Park Avenue, New York, NY under a hon-cancelable lease agreement, expiring in 202 **8.** The Company has recognized this lease as art opei•ating leaSe. The lease has provisions for future rent increases and rent-free periods. As such; the company recognizes a right-of-use asset (ROU asset) and a lease liability in it~ statement of financial condition, representing the present value, discounted at 6%; ofall future rent payments due until the end of the Hfeofthe lease. While the lease contains a renewal option for up to five years, the Company has determined that it will not exercise such renewal option .and therefore associated lease payments under the rnnewal option have been excluded from all consideration. Future minimum rental. payments under the. above. Jease are as fo I lows:

| Year Ending                       |            |
|-----------------------------------|------------|
| December 31,                      | Amount     |
| 2022                              | \$ 185,058 |
| 2023                              | ]92,125    |
| 2024                              | l-92,125   |
| 2025                              | 192;125    |
| 2026                              | 192,125    |
| Thereafter                        | 224,146    |
| Total undiscounted lease payments | I, lT7,704 |
| Less imputed interest             | (174,916)  |
| Total lease liability             |            |

#### 7: **Regulatory Net Capital Requirement**

The Compa,ny is subject to the. Uniform Net Capital Rule l 5c3-I (the "Rule"') of the Securities and Exchange Commission which requires a broker-dealer to have at all times sufficient 'liquid assets to. cover current indebtedness. Iri accordance with the rule, the Company is required to maintain defined minimum net capital of the greater of \$5 .. 0.00 or l /15 of aggregate indebtedness. Atno time may the ratio ofaggregate indebtedness to net capital a~ defined, exceed 15 to I. ·

At December 31, 2021, the Company has net capital of \$1,317,230. which is \$J ,272,580 in excess ofits required net capital of \$44,650. The Company has aggregate indebtedness of \$669,752. The Company's ratio of aggregate indebteclness to net capita] is 0.51 to I at December 3J, 2021. The Company ,vas, at December 31, 2021, a1id during the e11titety of2021, compliant with the minimum net capital ,requirement.

#### **8. Loan Fotgiveness**

On April 24, 2020, the company obtained a loan. of \$2 i 4,700 under the Paycheck Protection Program (the "PPP'') created· by the Coronavirus. Aid, Relief, and Economic: Security Act ("CARES") Act.• Borrowers under the PPP may apply to have their !C>~s forgiven if they use the proceeds of the loari to fun~ payroll. rent, and utilities costs incurred or paid during the covered period following the date the loan was fonded. In May 202l, the Company received full forgiveness on its PPP loan and as a result reduced the PPP loan related .liabilities from its books to zero.

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