# GRB FINANCIAL LLC X-17A-5 (2019-02-28) — Broker-dealer annual report - Company: GRB FINANCIAL LLC - Form: X-17A-5 - Filed: 2019-02-28 - Period: 2018-12-31 - Accession: 0001278205-19-000001 - CIK: 1278205 - File #: 8-66345 - Material weakness: No - Auditor: RHODES OSIEK PATYK & COMPANY, L.L.P - Auditor location: ARLINGTON, TX - Contact: GERALD R. BAKER - Phone: 817-861-7099 - Signed by: GERALD R. BAKER (PRESIDENT) Original filing: https://www.sec.gov/Archives/edgar/data/1278205/000127820519000001/other.pdf --- {0}------------------------------------------------ UNITEDST ATES SECURITIES Ai\TD EXCHANGE COMMISSION Washington, D.C. 20549 # **ANNUAL AUDITED REPORT FORM X-17A-5 PART Ill** | | OMS APPROVAL | |--------------------------|-----------------| | OMS Number: | 3235·0123 | | Expires: | August 31, 2020 | | Estimated average burden | | | hours per response | . 12.00 | | | | | | SEC FILE NUMBER | |----|-----------------| | 8- | | 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 01/01/2018 | | AND ENDING 12/31/2018 | | |--------------------------------------------------------------------------------------------|---------------------------------------------------------------------|-----------------------|-----------------------------------| | | MMIDDIYY | | ---------------------
MM/DD/YY | | | A. REGISTRANT IDENTIFICATION | | | | NAME oF BROKER-DEALER: GRB Financial, LLC | | | OFFICIAL USE ONLY | | ADDRESS OF PRINCIPAL PLACE OF BUSfNESS: (Do not use P.O. Box No.) | | | FIRM I.D. NO. | | 1415 West Randol Mill Road | | | | | | (No. and Street) | | | | Arlington | Texas | | 76012 | | (City) | (State) | | (Zip Code) | | NAME AND TELEPHONE NUMBER OF PERSON TO CONTACT IN REGARD TO HITS REPORT
Gerald R. Baker | | | 817-861-7099 | | | | | (Area Code -Telephone Number) | | | B. ACCOUNTANT IDENTIFICATION | | | | INDEPENDENT PUBLIC ACCOUNTANT whose opinion is contained in this Report* | | | | | Rhodes Osiek Patyk & Company, L.L.P | | | | | | (Name- if individual, state last. first, middle name) | | | | 2170 West Interstate 20 | Arlington | Texas | 76017 | | (Address) | (City) | (State) | (Zip Code) | | CHECK O NE: | | | | | I /I
Certified Public Accountant | | | | | Public Accountant
O | | | | | D | Accountant not resident in United States or any of its possessions. | | | | | FOR OFFICIAL USE ONLY | | | | | | | | | | | | | *\*Claims for exemption from the requirement that the annual report be covered* by */he opinion of an independent public accountanl must be supported by a statement of facts and circumstances relied on as the basis for the exemption. See Section 240.17a-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 14 1 0 (06-02) {1}------------------------------------------------ #### OATH OR AFFIRMATION | 1, Gerald R. Baker | , swear (or affirm) that, to the best of | |------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------| | GRB Financial, LLC | my knowledge and belief the accompanying financial statement and supporting schedules pertaining to the firm of | | of December 31, | --~----~-------------------------------------------------------------------------·as
2018
are true and correct. I further swear (or affirm) that | | classified solely as that of a customer, except as follows: | ne1ther the company nor any partner, proprietor, principal officer or director has any proprietary interest in any account | | | | | LESLI J MCKEE
Notary ID M10849086 | | | My Commi ssion Expires
May5, 2021 | | | | President | | | Title | | | | | | | | This report •• contains (check all applicable boxes): | | | 0 (a) Facing Page . | | | .; (b) Statement of Financ
ial Condition. | | | (c) Statement of Income (Loss).
(d) Statement of Changes in f inancial Condition. | | | (e) Statement of Changes in Stockholders' Equity or Partners' or Sole Proprietors' Capital. | | | (0 Statement of Changes in Liabilities Subordinated to Claims of Creditors . | | | .t (g) Computation of Net Capital. | | | .t (h) Computation for Detennination of Reserve Requirements Pursuant to Rule 15c3-3 .
.1 (i) Information Relating to the Possession or Control Requirements Under Rule 15c3-3. | | | | 0 (j) A Reconciliation, including appropriate explanation of the Computation of Net Capital Under Rule 15c3-l and the | | Computation for Determination of the Reserve Requirements Under Exhibit A of Rule 15c3-3. | | | consolidation. | O (k) A Reconciliation between the audited and unaudited Statements of Financial Condition with respect to methods of | | 0 (l)
An Oath or Affirmation. | | | 0 (m) A copy of the SIPC Supplemental Report. | | | 0 | (n) A report describing any material inadequacies found to exist or found to have existed since the date of the previous audit. | | Reconciliation. | X (o) Independent Accountant's Report on Applying Agree-upon Procedures Related to an Entity's S!PC Assessment | | 17a-5(e)4. | X (p) Schedule of Assessment and Payment to the Securities Investor Protection Corporation (SIPC) Under Rule | | X (q) lnh e 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 t he risks of mat erial misstatement of the financial statements, whether d ue to fraud or error, and performing procedures that respond to t hose risks. Such procedures include examining , on a t est basis, evidence supporting the amounts and disclosures in the financial statements. Our audit a lso included evaluating the accounting principles used and significant estimates made by management , as well as evaluating the overall pr esentation of the financial statements . We believe that our audit provides a ~easonable basis for our opinion . {4}------------------------------------------------ # Auditor's Report on Supplemental Information The Schedul e I Computation of Net Capital Under SEC Rule 15c 3- 1 (Schedules I I, III and IV are not applicable) has been subjected to aud it procedures performed in conjunction with the audit of GRB Financial , LLC's financial statements. The supplemental information is the responsibility of GRB Financial, LLC's management. Our audit procedures included determining whether the supplemental information reconciles to the financia l statements or the underlying accounting and other records, as applicable, a nd performing procedures to test the completeness and accuracy of the information presented in the supplemental information . In forming our opi nion on the supplemental informat ion, we evaluated whether the supplemental information, including its form and content, is presented in con£ormity with 17 C. F . R . 240 . 17a-5. In our opinion, Schedule I Computation of Net Capital Under SEC Rule 15c 3- 1 is fa irly stated, in all material respects, in rela tion to the financ ia l statements as a whole . We have served as the Company's auditor since 200 4 . Arlington, Texas Februar y 20, 2019 {5}------------------------------------------------ #### STATEMENT OF FINANCIAL CONDITION AS OF DECEMBER 31 , 2018 #### ASSETS | CURRENT ASSETS : | | | |----------------------------------------------------------------------------------|--|-----------------------| | Cash
Receivable from dealers | | \$
78,511
3,773 | | Total current assets | | 82,284 | | PROPERTY AND EQUIPMENT,
AT COST :
Net of depreciation (Note 2) | | 0 | | Total
Assets | | \$
82,284 | | LIABILITIES AND MEMBERS' EQUITY | | | | CURRENT LIABILITIES: | | | | Accounts payable and
accrued liabili
ties | | \$
0 | | Total current liabilities | | 0 | | MEMBERS' EQUITY | | | | Member units,
no par value, 100 units
Authorized
issued and outstanding | | 30,004 | | Retained earnings | | 52,280 | | Total members' equity | | 82,284 | | Total Liabilities and
Members' Equity | | \$
82,284 | The accompanying notes are an integral part of these financial statements. {6}------------------------------------------------ #### STATEMENT OF I NCOME FOR THE YEAR ENDED DECEMBER 31, 2018 #### REVENUES : | Commissions income | | \$
107,475 | |----------------------------|--|----------------| | Total revenues | | 107,
475 | | EXPENSES : | | | | Commissions | | 50
, 408 | | ts
License and permi | | 4,24
5 | | Insurance | | 1, 701 | | General and administrative | | 8,077 | | | | | | Total expenses | | 6 4,
431 | | NET INCOME | | \$
43 , 044 | The accompanying notes are an integral part of these financial statements -4- {7}------------------------------------------------ ### STATEMENT OF MEMBERS' EQUITY FOR THE YEAR ENDED DECEMBER 31, 2018 21 - | | | Member Units | | Retained | | |----------------------------|-------|--------------|---------------|----------|----------| | | Units | | Amount | | Earnings | | BALANCE, December 31, 2017 | | | 100 \$ 30,004 | S L | 9,236 | | Net Income | | | | | 43,044 | | BALANCE, December 31, 2018 | | 100
ട | 30,004 | S : | 52,280 | The accompanying notes are an integral part of these financial statements and and and and and the mail of the 1999 173 11. 2017 12:00 PM 2017 11:00 11 10 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 {8}------------------------------------------------ #### STATEMENT OF CASH FLOWS FOR THE YEAR ENDED DECEMBER 31 , 20 18 | CASH FLOWS FROM OPERATING ACTIVITI | ES : | | | |--------------------------------------------------------------------------------|---------------------------------|------|----------| | Net inc
ome | | \$ | 43,044 | | to reconcile ne
Ad j ust
ment
t
cash provided (used) b
y operat | o net
income t
ing activi | ties | | | Decrease in receivable from dea | l ers | | 1,952 | | | | | | | NET CASH PROVIDED FROM OPERATING ACTIVITIES | | | 44,996 | | CASH FLOWS FROM FINANCING ACTIVITIES | : | | | | NET CASH PROVIDED FROM FINANCING ACTIVITIES | | | 0 | | CASH FLOWS FROM INVESTING ACTIVITIES: | | | | | i on in invest
Red uct
ments | | | | | NET CASH PROVIDED FROM INVESTING ACTIVITIES | | | 0 | | | | | | | NET INCREASE IN CASH AND CASH EQUIVALENTS | | | 4 4 ,996 | | CASH AND CASH EQUI VALENTS AT BEGINNI NG OF YEAR | | | 33,515 | | CASH AND CASH EQUIVALENTS AT END OF YEAR | | \$ | 78,511 | The accompanying notes are an integral part of t h e se f ina ncial statements {9}------------------------------------------------ #### NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31 , 2018 #### (1) SU~lARY OF SIGNIFICANT ACCOUNTING POLICIES : History and organization - GRB F i nanci a l , LLC (the Company) was formed on October 1 , 2003 as a limited liability company under the provisi ons of the Texas Limited Liability Company Act. The Company operates as an independent broker-dealer of various investment securities and began operations January 1 , 2004 . No membe r of the limited liability company *v1ill* be liable for the debts, obligations, or liabilities of the Company . Accounting policies - The financial statements of the Company have been prepared on an accrual basis in accordance with generally accepted accounti ng principles . Cash and cash equivalents - For purposes of the statement of cash flows, the Company considers all clearing deposits and money market accounts to be cash equivalents. Receivable from dealers - The Company uses the d irect write off method for recording uncollectible receivables from dealers. Management has determined t hat the receivables fr-om dealers are tot ally collectible. Property and equipment - Property and equipment are carried at cost and consist of data processing equipment and office furniture and equipment . The Company has a policy wher eby proper ty addi tions below a minimum amou nt are expensed as incurred . Expenditures for major renewa l s and betterments that extend the useful lives of property a nd equipment are capitali zed . Expenditures for maintenance and repairs are charged to expense as i ncurred . U. S . Federal I ncome Taxes - The Company was organized as a limited liabil i ty company under the provisions of the Texas Limited Li ability Company Act. The Company has elected to be taxed under the partnership provisi ons of the Internal Revenue Code. Under those provisions the Company does not pay federal income taxes on its taxable income . I nst ead, the uni t - holders are liable for individ ual federal income taxes on their respective share of net i ncome. -7- {10}------------------------------------------------ #### NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31 , 2018 (1} SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued): Estimates - The preparation of financial statements in conformity with generally accept ed accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results coul d d i ffer from these estimates. Advertising costs - Advertising costs are expensed as incurred. Investments - The Company records marketable securities at fair market value . Upon the sal e of marketable securities, gain or loss is incl uded in the i ncome statement. Actual cost is used in computing gain or loss . Compensated absences - Compensated absences have not been accrued because the amount cannot be reasonably estimated. (2 ) PROPERTY AND EQUIPMENT: During 2018, the company owned no property and equipment in its name . All of the equipment is owned by the owner in another entity . (3) NET CAPI TAL REQUIREMENTS: Th e Company introduces transactions and accounts of customers nr other brokers or dealers to Sterne Agee & Leach Securities, Inc . and is subject to SEC r u l e 15c 3-1 (a) (2) (iv) \'Thich states the firm will maintain a minimum net capital of not less than \$5,000. At December 31, 2018, t he Company has net capital of \$79,354, which is in excess of its required net capital. ( 4) RELATED PARTY TRANSACTION: The Company is currently in an agreement with Baker Financial Ser vices, an affiliated company, owned 90% by the ma jority unit - holder. This agreement makes available certain facilities and provides for performance of certain services for the Company . These services and facilities are provided without cost to the Company . -8- {11}------------------------------------------------ #### NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2018 (CONTINUED) #### FOCUS REPORT PART II DIFFERENCE: (5) Differences between the accompanying financial statements and the Company's December 31, 2018, Focus Report Part II are as follows: | Per Accompanying | | | Per | | | |---------------------------|----|---------------------|-----------|---|------------| | | | Financial Statement | Focus | | Difference | | | | | | | | | Cash | မာ | 78,511 | \$ 80,390 | ഗ | (1,879) | | Receivable from dealers | | 3,773 | | 0 | 3,773 | | Property and equipment | | O | | 0 | 0 | | Accounts payable, accrued | | | | | | | liabilities, expenses and | | | | | | | other payables | | 0 | | 0 | 1 1 | | Members' equity | | 82,284 | 80,390 | | (1,894) | | | | | | | | #### SUBSEQUENT EVENTS: (6) The Company evaluated subsequent events after the statement of financial position date of December 31, 2018 through February 20, 2019, which was the date the financial statements were issued, and concluded that no additional disclosures are required. -9- {12}------------------------------------------------ ## COMPUTATION OF NET CAPITAL UNDER RULE l5c 3-l OF THE SECURITIES AND EXCHANGE COMMISSION AS OF DECEMBER 31, 2018 #### SCHEDULE I #### NET CAPITAL | TOTAL MEMBERS'
EQUITY | \$
, 284
82 | |----------------------------------------------------------------------------------------------------------------------|-------------------| | DEDUCTIONS | (2, 930) | | NET CAPITAL BEFORE HAIRCUTS | 79,354 | | HAIRCUTS ON T~~DING AND INVESTMENT SECURITIES | (0) | | NET CAPITAL | \$
79,35
4 | | | | | AGGREGATE I NDEBTEDNESS | | | ACCOUNTS PAYABLE AND ACCRUED EXPENSES | \$
0 | | TOTAL AGGREGATE INDEBTEDNESS | \$
__ j ) | | | | | COMPUTATION OF BASIC NET CAPITAL REQUIREMENTS : | | | Greater of 6 2/3% of Aggregate Indebtedness
or | 0 | | Minimum Dollar Net Capital | \$
5,000 | | Minimum Net Capital Required | \$
5 , 000 | | | | | Ratio:
Aggregate Indebtedness to Net Capital | . 0 TO 1 | | (included in
RECONCILIATION WITH COMPANY'S COMPUTATION
Part II of Form X-17a-5 as of December 31
2018)
, | | | Net Capital as Reported in Company's Part II | | | Focus Report | \$
80,390 | | Adjustments | ( l, 036) | | Capital Per Above
Net | | {13}------------------------------------------------ Curt H. OSiek Michael A. Pa1yk Poulo J. H~tnkler Lisa M. Wharton # Independent Registered Public Accounting Firm ' s Report on Exemption Report To the Members of GRB Financial, LLC : We have r eviewed management's statements, included in the accompanying Exemption Report , in which 1) GRB F inancial, LLC identified the following provisions of 17 C. F.R. Rule 15c 3-3(k) under which GRB Financial, LLC claimed an e xemption from 17 C. F . R. Rule 240 . 15 3-3 (k) (2) (i) and 2) GRB Financial, LLC stated that GRB Finan c i al, LLC met the identified exemption provisions throughout the most recent fiscal year without exception. GRB Financial, LLC's management is responsibl e 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 inqui ries and other required procedures to obtain evidence about GRB Financial, LLC's compliance with the exempti on provisions. A review is substantially less in scope than an examination, the objective of which is the expressi on of an opinion on management's s t atements. Accordingly, we d o not express such an opinion. Based on our r eview, we are not aware of any materi al modificat ions that should be made to management's statements referred to above for them to be fa i rly stat ed, in all materi al respects, based on t he provisions set fort h in paragraph (k ) (2) (i) of Rul e 15c 3- 3 under the Securities Exchange Act of 193 4. Arlington, Texas February 20, 201 9 {14}------------------------------------------------ We were not engaged to and d i d not conduct an examination or review, the objective of which would be the expression o f an opinion o r conclusion, respectively, on GRB Financial, LLC's compliance with the applicable i nstructions of the Form SIPC- 7 for the year e nded December 3 1 , 201 8 . Accordingly, we do not express such an opinion or conclusion . Had we performed additional procedures, other matters might have come to our attention that wou l d have been reported to you . This r epor t i s intended solely for the information and use of GRB Financial, LLC . and the SIPC and is not intended to be and should not be used by anyone other than these specifi ed parties. Arlingt on, Tex as February 20 , 2019 {15}------------------------------------------------ ### SCHEDULE OF ASSESSMENT AND PAYMENT TO THE SECURITIES INVESTOR PROTECTION CORPORATION (SIPC) UNDER RULE 17a-5(e) (4) OF THE SECURITIES AND EXCHANGE COMMISSION FOR THE YEAR ENDED DECEMBER 31, 2018 | GENERAL ASSESSMENT | | 32 | |-----------------------------------------------------------|---|-------| | LESS OVERPAYMENT FROM 2018 | | (100) | | ASSESSMENT BALANCE DUE (OVERPAID) | | (68) | | TOTAL ASSESSMENT BALANCE OR (OVERPAYMENT CARRIED FORWARD) | ഗ | 68) | DETERMINATION OF "SIPC NET OPERATING REVENUES" AND GENERAL ASSESSMENT | | 12/31/18 | |------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------| | TOTAL REVENUE FOCUS PART IIA LINE 9
5 | 107,475 | | TOTAL ADDITIONS | | | DEDUCTIONS : | | | Revenues from the distribution of shares of a registered open
end investment company or unit investment trust, from the
sale of variable annuities, from the business of insurance,
from investment advisory services rendered to registered
investment companies or insurance companies separate
account, and from transactions in security futures products | 86,014 | | 100% of commissions and markups earned from transactions in
(i) certificates of deposit and (ii) treasury bills, bankers
acceptances or commercial paper that mature nine months or
less from issuance date | | | Other revenue not related either directly or indirectly to the
securities business | | | TOTAL DEDUCTIONS | 86,014 | | 5
SIPC NET OPERATING REVENUE | 21,461 | | GENERAL ASSESSMENT @ . 0015
\$ | 32 | -13- {16}------------------------------------------------ Curt K. Osiek Michael A Patyk Paula *J,* Hurokler Usa M-. Wharton # Independent Registered Pu blic Accounting F i rm ' s Report on Exemption Report To the Members of GRB Financial , LLC : We have r evi ewed management's stat ements, incl uded in the accompanying Exemption Report, in which **1)** GRB F inancial , LLC identified the following provisions of 17 C . F .R. Rule lSc 3- 3(k) under which GRB Financial, LLC claimed an exempti on from 17 C . F.R. Ru le 240.15 3 - 3 (k) (2) (i) and 2) GRB Financial, LLC stated that GRB Financial, LLC met the ident ified exemption provisions through out the most recent fisca l year without exception . GRB Financial, LLC ' s management is responsible for compliance wi th the e xemption provisions and its s t atements . Our review was conduct ed in accordance wit h the standar ds of the Public Company Accounting Oversight Board (United States) and, accordingly, included i nquiries and other required procedures to obtain eviden ce about GRB Fi nancial, LLC ' s compliance with the exemption provisions . A review is subst ant ial ly less in scope than an examinat ion, the objective of which is the expression of an opinion on management ' s statements . Accordingl y, 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 respect s, based on the provisions set forth in paragraph (k) {2) (i) of Rule 15c 3- 3 under the Securiti es Exchange Act of 1934 . Arlington, Texas February 20 , 2019 {17}------------------------------------------------ # **GRB FINANCIAL LLC** *Pinancia(ft.dvisors* 1415 W. Randol Mill Road Post Office Box 120427 Arlington, TX 76012 #### GRB Financial LLC #### EXEMPTION REPORT FOR THE YEAR ENDED DECEMBER 31. 2018 GRB Financial 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. § 17a-5 (d) (1) and ( 4). To the best of its knowledge and belief, the Company states the following: The Company provides comprehensive investments services to the general public, including both individual and institutional investors pursuant to direct selling arrangements with registered investment companies. Under these arrangements, the Company may receive customer funds for the purpose of the purchase of redeemable securities of regjstered investment companies. In order to evidence compliance with existing regulations, the Company maintains such books and records as are customarily made and kept pursuant to 17 C.F .R.§240.15c3-3 (k) (2) (i). In addition, the Company effectuates all financial transactions pertaining to the settlement of limited partnership and REIT trades on the secondary market through a bank account designated as "Special Account for the Exclusive Benefit of Customers" pursuant to 17 C.F.R §240.l5c3-3 (k) (2) (i). To the best of its knowledge and belief, the Company believes that it met the provisjons of the above exemptions during the fiscal year 2018 without exception. GRB Financial LLC I • .....,""'.k~Q~C.:J.::;.; . \_f'\=--'"....:~-=\:\_~..:;;..;,s'h.;::;;.\_ \_\_\_ \_., affirm that, to my best knowledge and belief, this Exemption Report is true and correct. By: {t(fl•ft[/1 Date: ;2/~{r *'1* · r Title: *c c...D I* r( J'l c) p ------~,~------------------ Securities Offered Through GRB Financial, LLC. 14 15 West Randol Mill Rd. Arlington, TX 76012 Member FINRA-SIPC Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.