# NEAR EARTH, LLC X-17A-5 (2022-05-31) — Broker-dealer annual report - Company: NEAR EARTH, LLC - Form: X-17A-5 - Filed: 2022-05-31 - Period: 2021-12-31 - Accession: 0001222417-22-000002 - CIK: 1222417 - File #: 8-65846 - Type: Broker-dealer - Material weakness: No - Auditor: Adeptus Partners, LLC - Auditor location: Ocean, NJ - Contact: Hoyt Davidson - Phone: 203972-9062 - Website: adeptuscpas.com - Signed by: Hoyt Davidson (Managing Member) Original filing: https://www.sec.gov/Archives/edgar/data/1222417/000122241722000002/ne21s.pdf --- {0}------------------------------------------------ #### **NEAR EARTH, LLC** STATEMENT OF FINANCIAL CONDITION AND INDEPENDENT AUDITORS' REPORT DECEMBER 31, 2021 {1}------------------------------------------------ #### UNITED ST A TES 0MB APPROVAL SECURITIES Al.~ EXCHANGE COMMISSION Washington, D.C. 20549 # ANNUAL REPORTS FORM X-17A-5 **PARTID** | 0MB Number: 3235-0123 | |--------------------------| | Expires: Oct. 31, 2023 | | Estimated average burden | | hours per response: 12 | | SEC FILE NUMER | 8- 65846 **FACING PAGE Information Required Pursuant to Rules 17a-5, 17a-l2, and 18a-7 under the Securities Exchange Act of 1934** FILING FOR THE PERIOD BEGINNING O **1/01 /21** AND ENDING **12/31/21** ---- ----- MM/DDNY MM/DD *NY* #### **A. REGISTRANT IDENTTFTCA TION** # NAME OF FIRM: Near Earth LLC ----------- -------------- ----- TYPE OF REGISTRANT (check all applicable boxes): ® Broker=dealer D Security-based swap dealer D Major security-based swap participant D Check here if respondent is also an OTC derivatives dealer ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use a P.O. box no.) # 945 WEST ROAD, | NEW CANAAN | CT | 06840 | | |------------|---------|------------|--| | (City) | (State) | (Zip Code) | | PERSON TO CONT ACT WITH REGARD TO nns FILING Hoyt Davidson (203) 972-9062 hoyt@nearearthl le. com (Name) (Area Code - Telepbone Number) (Email Address) #### **B. ACCOUNTANT IDENTIFICATION** TNDEPENDENT PUBUC ACCOUNT ANT whose reports are contained in this filing\* # Adeptus Partners, LLC (Name - if individua~ state lasL first, and middle name) | 733 State Route 35 | Ocean | NJ | 07712 | |-------------------------------------------------|--------|---------|--------------------------------------------| | (Address) | (City) | (State) | (Zip Code) | | 01/06/10 | | 3686 | | | (Date of Registration with PCAOB)(ifapplicable) | | | (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 suppo1ted by a stacement of facts and circumstances reHed on as the basis of the exemption. See 17 CFR 240. I 7a-S(e)(I )(ii), if applicable. Persons who are to r espond to the collection of information contained in this form are not required to r espond unless the form displays a currently valid 0MB control number. {2}------------------------------------------------ #### **AFFIRM A TTON** I, Hoyt Davidson , swear (or affinn) that, to the best of my knowledge and belief, the financial report pertaining to Near Earth LLC as of 12/31/21 , is true and correct. I further 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. **Si(!/1;:M=** **Title** ![](_page_2_Picture_4.jpeg) {3}------------------------------------------------ # **This filing\*\* contains (check all applicable boxes):** - **CEI** (a) Statement of financial condition. - **CEI** (b) Notes to unconsolidated or consolidated statement of financial condition, as applicable. - D ( 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 § 2 10.1-02 of Regulation S-X). - **D** ( d) Statement of cash flows. - D (e) Statement of changes in stockholders' or partners' or members' or sole proprietor's equity, as applicable. - **D** (f) Statement of changes in liabilities subordinated to claims of creditors. - D (g) Notes to unconsolidated or consolidated financial statements,, as applicable. - D (h) Computation of net capital under 17 CFR 240. l 5c3-1 or 17 CFR 240.18a-l, as applicable. - **D** (i) Computation of tangible net worth under 17 CFR 240.l 8a-2. - **D** (j) Computation for determination of customer reserve requirements pursuant to Exhibit A to 17 CFR 240. l 5c3-3. - D (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. - D (l) Computation for Determination of PAB Requirements under Exhibit A to§ 240. I 5c3-3. - D (m) Information relating to possession or control requirements for customers under 17 CFR 240. l 5c3-3. - D (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. - D (o) Reconciliations, including appropriate explanations, of the FOCUS Report with computation of net capital or tangible net worth under 17 CFR 240. l 5c3-l , 17 CFR 240. l 8a-l , or 17 CFR 240. l 8a-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. - D (p) Summary of financial data for subsidiaries not consolidated in the statement of financial condition. - 0 (q) Oath or affirmation in accordance with 17 CFR 240. 17a-5, 17 CFR 240.1 7a-l 2, or 17 CFR 240. l Sa-7, as applicable. - D (r) Compliance report in accordance with 17 CPR 240. l 7a-5 or 17 CFR 240. l 8a-7, as applicable. - D (s) Exemption report in accordance with 17 CFR 240.17a-5 or 17 CFR 240. I 8a-7, as applicable. - CEI (t) Independent public accountant's report based on an examination of the statement of financial condition. - D ( u) Independent public accountant's report based on an examination of the financial report or financial statements under 17 CFR 240. l 7a-5, 17 CFR 240.1 8a-7, or 17 CFR 240. I 7a-l 2, as applicable. - D (v) Independent public accountant's report based on an examination of certain statements in the compliance report under 17 CFR 240. l 7a-5 or 17 CFR 240.18a-7, as applicable. - D (w) Independent public accountant's report based on a review of the exemption report under 17 CFR 240. l 7a-5 or 17 CFR 240. l 8a-7, as applicable. - D (x) Supplemental reports on applying agreed-upon procedures, in accordance with 17 CFR 240. l 5c3-l e or 17 CFR 240. l 7a-l 2, as applicable. - D (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.l 7a-12(k). D (z) Other:------------------------------------- - *\*\*To request confidential treatment of certain portions of this filing, see 17 CFR 240.J 7a-5(e)(3) or 17 CFR 240.18a-7(d)(2), as applicable.* {4}------------------------------------------------ ![](_page_4_Picture_0.jpeg) Adeptus Partners, LLC Accountants I Advisors 200 Mamaroneck Avenue, Suite 502 White Plains, NY 10601 Phone: 212. 758.8050 Fax: 212.826.5037 www.AdeptusCPAs.com #### **REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM** To the Members' of Near Earth, LLC #### **Opinion on the Financial Statement** We have audited the accompanying statement of financial condition of Near Earth, LLC as of December 31, 2021 , 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 Near Earth. LLC 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 Near Earth, LLC's management. Our responsibility is to express an opinion on Near Earth, LLC'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 Near Earth, 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 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 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. We have served as Company's auditor since 2021. Ocean, NJ May 27, 2022 {5}------------------------------------------------ # **NEAR EARTH, LLC** STATEMENT OF FINANCIAL CONDITION DECEMBER 31 , 2021 #### **ASSETS** | Cash and cash equivalents | \$
75,642 | |---------------------------------------|---------------| | Accounts receivable | 14,900 | | Investments (Note 1) | 417,079 | | Other assets | 523 | | Total assets | \$
508,144 | | LIABILITIES AND MEMBERS' EQUITY | | | Liabilities: | | | Accounts payable and accrued expenses | \$
1,956 | | Members' equity | 506,188 | | Total liabilities and members' equity | \$
508,144 | The accompanying notes are an integral part of this statement {6}------------------------------------------------ #### **NEAR EARTH, LLC** NOTES TO FINANCIAL STATEMENT DECEMBER 31, 2021 #### **1. Nati1re of b11siness and summary ofsignificant accounting policies** # *Nature of Operations* Near Earth, LLC (the "Company"), a Limited Liability Company, is a broker-dealer registered with the Securities and Exchange Commission ("SEC") pursuant to section 15(b) of the Securities Exchange Act of I 934. The Company is also a member of the Financial Industry Regulatory Authority ("FINRA"). The Company earns consulting and advisory fees, including compensation in the form of stock or stock options, from providing investment banking services through its participation in private placement offerings and providing merger and acquisition, financial advisory and general corporate consulting services to comp am es. The liability of each member is limited to their capital account balance with the Company. # *Basis of Presentation* The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America ("GAAP") which 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 amounts of revenues and expenses during the reporting period. actual results could differ from these estimates. #### *Cash Equivalents* The Company considers money market mutual funds and other highly-liquid investments with original maturities of three months or less to be cash equivalents. #### *Income Taxes* The Company is taxed as a partnership for income tax purposes. The Company's income or loss is taken into consideration in the tax returns of its members for federal and state income tax purposes. In addition, it pays state income taxes on behalf of the individual members. These are treated as capital distributions. {7}------------------------------------------------ #### **NEAR EARTH, LLC** NOTES TO FINANCIAL STATEMENT (CONTINUED) DECEMBER 31 , 2021 #### **1. Nature of business and summary of significant accounting policies** ( **continued)** #### *Fair Value Measurements* The Company follows Financial Accounting Standard Board (F ASB) guidance on Fair Value Measurements which defines fair value and establishes fair value hierarchy organized into three levels based upon the input assumptions used in pricing assets. Level I inputs have the highest reliability and are related to assets with unadjusted quoted prices in active markets. Level 2 inputs relate to assets with other than quoted prices in active markets which may include quoted prices for similar assets or liabilities or other inputs which can be corroborated by observable market data. Level 3 inputs are unobservable inputs and are used to the extent that observable inputs do not exist. As of and for the year ended December 31 , 202 1 all of the Company's investments held and income on principal transactions were valued using Level 3 inputs. The Company's investments include an equity interest m a private portfolio company (the "Portfolio Company") that is carried at fair value as determined by Management. Management utilizes the Company's pro-rata interest in the net assets of the Portfolio Company as reported by the Portfolio Company's management. Management considers all relevant information available at the time the Portfolio Company values its investments. Management has assessed factors including, but not limited to, the Portfolio Company's price transparency and valuation procedures in place, capital subscription and redemption activity, and existence of certain redemption restrictions. The Portfolio Company generally records its investments at fair value in accordance with U.S. GAAP. The fair value at which the Portfolio Company is presented in the statement of financial condition may be different from the amount the Company would receive in a sale or liquidation of its investment and the differences may be material. # *Fair Value of Investments* | The following table summarizes the valuation of the Company's investments by the above fair | | | | | |---------------------------------------------------------------------------------------------|---------|---------|---------------|-----------| | value hierarchy levels at December 31, 2021: | Level 1 | Level 2 | Level 3 | Total | | Assets | | | | | | Equities | | | \$ 66,156 | \$ 66,156 | | Options | | | 350,923 | 350,923 | | Total assets | \$ | \$ | \$
417,079 | \$417,079 | {8}------------------------------------------------ #### **NEAR EARTH, LLC** NOTES TO FINANCIAL STATEMENT (CONTINUED) DECEMBER 31 , 2021 #### **1. Nature of business and summary of significant accounting policies** ( **continued)** # *Fair Value of Investments (continued)* The following table presents changes in assets classified in Level 3 of the fair value hierarchy during the year ended December 31, 2021 attributable to the following: | | Equity | | | |--------------------------|------------|---------------|--| | | Securities | Options | | | Purchases | | 18,590
\$ | | | Transfers into Level 3 | | 18,590 | | | Transfers out of Level 3 | (60,795) | (151
,000) | | The following table provides information on the valuation techniques and nature of significant unobservable inputs used to determine the value of level three assets: | Asset | Fair Value
December 31, 2021 | Valuation
Techniaues | Unobservable
lnouts | Range oflnputs
(Weighted
Avera11:e) | |-------------------------|---------------------------------|-------------------------|------------------------------------------------------|-------------------------------------------| | | | | Value of underlying assets
discounted for lack of | | | Equities and
options | 417,079
\$ | Derived price | marketabilitv | 25%-35% (30%) | #### *The Allowance for Credit losses* ASC Topic 326, Financial Instruments - Credit Losses ("ASC 326") impacts the impairment model for certain financial assets by requiring a current expected credit loss ("CECL") methodology to estimate expected credit losses over the entire life of the financial asset. Under ASC 326, the Company could determine there are no expected credit losses in certain circumstances (e.g., based on the credit quality of the client). The allowance for credit losses is based on the Company's expectation of the collectability of financial instruments, including fees and other 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. Under the standard, the allowance for credit losses must be deducted from the amortized cost of the financial asset to present the net amount expected to be collected. The statement of operations would reflect the measurement of credit losses for newly recognized financial assets as well as the expected increases or decreases of expected credit losses that might have taken place during the period. The Company has not provided an allowance for credit losses at December 31 , 2021. {9}------------------------------------------------ #### **NEAR EARTH, LLC** NOTES TO FINANCIAL STATEMENT (CONTINUED) DECEMBER 3 I, 202 I #### **2. Regulatory Requirements** The Company is subject to the Securities and Exchange Commission's Uniform Net Capital Rule (Rule 15c3-l) 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 1500%. At December 31, 2021, the Company's net capital was \$73,686 which was \$68,686 in excess of its minimum requirement of\$5,000. #### **3. Compliance with Rule 15c3-3** The Company does not hold customers' cash or securities on behalf of customers and accordingly has no obligation under SEC Rule l 5c3-3-3. #### 4. **Concentrations** 100% of the Company's accounts receivable is from one client. #### **5. Subsequent Events** The Company has evaluated subsequent events through the date the financial statements were issued. #### **6. Disaggregation of revenue** | Placement fees | 1,081,000
\$ | |---------------------------|-----------------| | Advisory fees | 232,825 | | Stock option compensation | 18,590 | | | 1,332,415
\$ | # 7. **Prior period adjustment** Members' equity as of the beginning of the year was adjusted to correct for individual state tIDCes attributable to the members personally that were incorrectly accrued by the Company at the end of the previous year, which in retrospect should have instead been reflected as capital distributions in the current year. The impact of this improper accrual was that the reported members' equity as of the end of the previous year was understated and accordingly, its net capital at that point was likewise understated. Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.