# PICKWICK CAPITAL PARTNERS, LLC X-17A-5 (2024-03-29) — Broker-dealer annual report - Company: PICKWICK CAPITAL PARTNERS, LLC - Form: X-17A-5 - Filed: 2024-03-29 - Period: 2023-12-31 - Accession: 0001280139-24-000003 - CIK: 1280139 - File #: 8-66373 - Type: Broker-dealer - Material weakness: No - Auditor: YSL & Associates LLC - Auditor location: New York, NY - Contact: Douglas Greenwood - Phone: 914-220-5881 - Signed by: Douglas Greenwood (CEO) Original filing: https://www.sec.gov/Archives/edgar/data/1280139/000128013924000003/public.pdf --- {0}------------------------------------------------ # PICKWICK CAPITAL PARTNERS, LLC FINANCIAL STATEMENT PURSUANT TO 17a-S(d) OF THE SECURITIES AND EXCHANGE COMMISSION AND REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM DECEMBER 31, 2023 {1}------------------------------------------------ # **PICKWICK CAPITAL PARTNERS, LLC CONTENTS** | 1
Report oflndependent Registered Public Accounting Firm | | | |-------------------------------------------------------------|---|--| | Financial Statements: | | | | Statement of Financial Condition | 2 | | | Notes to Financial Statements 3-7 | | | {2}------------------------------------------------ ![](_page_2_Picture_0.jpeg) 11 Broadway, Suite 700, New York, NY 10004 Tel: (212) 232-0122 Fax: (646) 218-4682 # **REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM** To the Members of Pickwick Capital Paitners, LLC ### **Opinion on the Financial Statement** We have audited the accompanying statement of financial condition of Pickwick Capital Pa1tners, LLC (the "Company") as of December 31, 2023, and the related notes ( collectively refened to as the "financial statement"). In our opinion, the financial statement presents fairly, in all material respects, the financial position of the Company as of December 31, 2023 in confonnity 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 ai·e a public accounting fum registered with the Public Company Accounting Oversight Boai·d (United States) (PCAOB) and ai·e required to be independent with respect to the Company in accordance with the U.S. federal seclllities laws and the applicable mies and regulations of the Securities and Exchange Commission and the PCAOB. We conducted om audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assmance about whether the financial statement is free of mate1ial lnisstatement, whether due to en or or fraud. Our audit included performing procedures to assess the 1isks of material lnisstatement of the financial statement, whether due to enor or fraud, and performing procedmes that respond to those risks. Such procedmes included examining, on a test basis, evidence regarding the amounts and disclosmes 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 om opinion. We have se1ved as Pickwick Capital Pa1tners, LLC's auditor since 2016. NewYork, NY March 27, 2024 {3}------------------------------------------------ ### **PICKWICK CAPITAL PARTNERS, LLC** #### **STATEMENT OF FINANCIAL CONDITION** #### **DECEMBER 31, 2023** #### **ASSETS** | Cash | \$
605,262 | |---------------------------------|-----------------| | Accounts receivable, net | 1,604,519 | | Prepaid expenses | 140,166 | | Securities owned, at fair value | 80,254 | | Advances to employees | 35,918 | | Other assets | 6,091 | | Total Assets | \$
2,472,210 | #### **LIABILITIES AND MEMBERS' EQUITY** Liabilities: | Accounts payable and accrned expenses | \$
1,384,527 | |-------------------------------------------------------------|-----------------| | Defened revenue | \$
101,590 | | Commission payable to member | 66,433 | | Total Liabilities | 1,552,550 | | Liabilities subordinated to the claims of general creditors | 180,000 | | Members' equity | 739,660 | | Total Liabilities and Members' Equity | \$
2,472,210 | The accompanying notes are an integral part of these financial statements. {4}------------------------------------------------ ## **1. ORGANIZATION AND NATURE OF BUSINESS** Pickwick Capital Partners, LLC (the "Company") was organized under The Wyoming Limited Liability Act. It is registered as a broker-dealer with the Securities and Exchange Commission ("SEC"), and is a member of the Financial IndustJ.y Regulato1y Authority ("FINRA") and Securities Investor Protection Corporation ("SIPC") and Municipal Securities Rulemaking Board ("MSRB"). The Company provides stJ.·ategic advis01y services regarding business operations and investment banking tJ.·ansactional services including advis01y and capital raising for corporate customers and Hedge, Private Equity, Venture, and other alternative asset funds. The Company also provides Chaperoning services under Rule 15a-6 of the Securities Exchange Act of 1934. ### Recent Issued Accounting Pronouncements The Company does not believe that the adoption of any recently issued, but not yet effective, accounting standards will have a material effect on its financial position and results of operations. # **2. SIGNIFICANT ACCOUNTING POLICIES** ### Basis of Presentation The accompanying financial statements have been prepared in confonnity with U.S. generally accepted accounting principles ("GAAP") and the mles and regulations of the SEC. It is management's opinion, that all material adjustJ.nents ( consisting of n01mal recmTing adjustJ.nents) have been made which are necessaiy for a fair financial statement presentation. ## Cash and Cash Equivalents The Company considers all highly liquid investJ.nents with a maturity of three months or less when purchased to be cash equivalents. Cash equivalents are cani.ed at cost, which approximates fair value. ## Accounting Basis The Company uses the accmal basis of accounting for financial statement and cash basis for income tax rep01ting. Accordingly, revenues ai·e recognized when se1vices ai·e rendered and expenses realized when the obligation is incmTed. #### Use of Estimates The prepai·ation of financial statements in confo1mity with GAAP requires management to make estimates and assumptions that affect the rep011ed amounts of assets and liabilities, and disclosure of contingent assets, and liabilities at the date of the financial statements, and the rep011ed amounts of revenues and expenses dming the rep01ting pe1i.od. Actual results could differ from those estimates. #### Accounts Receivable Accounts receivable is recorded at the amount the Company expects to collect on balances outstanding at year-end. The dete1mination of the amounts of uncollectible accounts is based on the length of time each receivable has been outstanding, and a reasonable assessment of the capacity of the debtor to pay the receivable. As of Janua1y 1, 2023 and December 31, 2023, the Company's accounts receivable were \$1,380,910 and \$1,604,519, respectively. The allowance for uncollectible amounts reflects the amount of loss that can be reasonably estimated by management and is included as pait of operating expenses in the accompanying statement of operations. At December 31, 2023, the Company recorded total bad debts in the amount of \$226,799. {5}------------------------------------------------ #### **2. SIGNIFICANT ACCOUNTING POLICIES (continued)** #### Contract Balances Contract assets arise when the revenue associated with the contract is recognized prior to the Company's unconditional right to receive payment under a contrnct with a customer and are derecognized when either it becomes a receivable or the cash is received. Contract liabilities arise when customers remit contractual cash payments in advance of the Company satisfying its perfo1mance obligation under the contract and are derecognized when the revenue associated with the contract is recognized when the perfo1mance obligation is satisfied. The Company did not have any contract assets or liabilities at Janua1y 1, 2023. The Company has no contract assets but has contract liabilities of \$101,590 at December 31, 2023. #### Allowance for Credit Losses The Company follows ASC Topic 326, Financial Instrnments - Credit Losses ("ASC 326"). The Company identified no fees receivable as impacted by the guidance. An allowance for credit losses may be based on the Company's expectation of the collectability of its receivables utilizing the CECL framework. The Company considers factors such as historical experience, credit quality, age of balances and cmTent and future economic conditions that may affect the Company's expectation of the collectability in dete1mining the allowance for credit losses. The Company makes an allowance for receivables that are aged over 12 months. Accordingly, the Company provided an allowance for credit losses in the amount of \$26,091 at December 31, 2023. #### Revenue Recognition and Commission Cost The Company recognizes revenue to depict the transfer of promised services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those services. The guidance requires an entity to follow a five-step model to (a) identify the contract(s) with a customer, (b) identify the perfo1mance obligations in the contract, ( c) dete1mine the transaction price, ( d) allocate the trnnsaction price to the perfo1mance obligations in the contract, (e) recognize revenue when (or as) the entity satisfies a perfonnance obligation. In detennining the transaction price, an entity may include variable consideration only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized would not occur when the unce1iainty associated with the variable consideration is resolved. The Company's revenues are from success fees, consulting fees, fixed retainer fees, and a percentage of the Fund Manager's fees. The Company typically enters into contracts with clients calling for periodic retainer fees to be paid during the te1m of the anangement, and a success fee to be paid out once the merger, acquisition, or private placement (the "transaction") is successfully completed. This success fee is typically based on a percentage of the total consideration of the transaction, although in celiain cases it may be a flat fee. Accordingly, the Company recognizes retainer fees in the period earned, with separate revenue recognition once each transaction is finalized. Consulting agreements with Fund Managers are multi-year contracts. Marketing contracts are also for multiple years. The Company is compensated by a fixed fee and or a percentage of the Fund's fees. The fee to be paid to the Company shall be deternlined on the basis off ees earned and collected by the Fund Manager. This calculation shall include all fees earned and received by the Fund Manager as a result of cash or in-kind additions to the accounts, or fees based on investment performance. Once the fee is dete1mined and agreed (realized) upon by both the Company and the Fund Manager, the Company recognizes the fee and invoices the Fund Manager. Fee income is recognized when earned and related perfo1mance obligations are satisfied in accordance with contractual anangements with clients and the collectability is reasonably assured. Related commission expense is recognized at the same time as the fee income. {6}------------------------------------------------ ### **2. SIGNIFICANT ACCOUNTING POLICIES (continued)** #### Significant Judgments The recognition and measmement of revenue is based on the assessment of individual contract te1ms. Significant judgment is required to dete1mine whether performance obligations are satisfied at a point in time or over time; how to allocate transaction prices where multiple perfo1mance obligations are identified; when to recognize revenue based on the appropriate measme of the Company's progress under the contract; and whether constraints on variable consideration should be applied due to unceI1ain future events. ### Concentrations of Credit Risk The Company places its cash with two high credit quality financial institutions. The Company's accounts at each of these institutions are insmed by the Federal Deposit Insmance Corporation ("FDIC") up to \$250,000. To reduce its risk associated with the failure of either of such financial institutions, the Company evaluates at least annually the rating of the financial institutions in which it holds deposits. ### Fair Values of Financial Instmments F ASB ASC 820 defines fair value, establishes a framework for measming fair value, and establishes a fair value hierarchy which prioritizes the inputs to valuation techniques. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A fair value measurement assumes that the transaction to sell the asset or transfer the liability occurs in the principal market for the asset or liability, or in the absence of a principal market, the most advantageous mai·ket. Valuation techniques that are consistent with the market, income, or cost approach, as specified by F ASB ASC 820, are used to measure fair value. The fair value hierai·chy prioritizes the inputs to valuation techniques used to measure fair value into three broad levels: Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities the Company has the ability to access. Level 2 inputs ai·e inputs other than quoted prices included with Level 1 that ai·e obse1vable for the asset or liability, either directly or indirectly. Level 3 are unobse1vable inputs for the asset or liability and rely on management's own assumptions about the assumptions that market paiiicipants would use in pricing the asset or liability. The unobse1vable inputs should be developed based on the best infmmation available in the circumstances and may include the Company's own data. The Company's assets and liabilities are recorded at fair value on a recmTing basis based upon a fair value hierai·chy, in accordance with ASC 820, as of December 31, 2023. The following table presents a reconciliation of Level 1 assets measured at fair value for the yeai· ended December 31, 2023. Assets | Secmities
owned | |--------------------| | \$
133,065 | | (332) | | 332 | | {52,811) | | \$
80 254 | | | {7}------------------------------------------------ ## **2. SIGNIFICANT ACCOUNTING POLICIES (continued)** ### Income Taxes The members are individually liable for the federal and state taxes on the Company's income or loss. However, the Company is subject to New York City Unincorporated Business Tax and, when applicable, a provision will be included on the statement of operations. The Company complies with Financial Accounting Standards Board ("F ASB") Accounting Standa1·ds Codification ("ASC") 740, Income Taxes which requirn an asset and liability approach to financial accounting and rep011ing for income taxes. Defe1rnd income tax assets and liabilities are computed for differences between the financial statement and tax basis of assets and liabilities that will result in taxable or deductible amounts in the future based on the enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessaiy, to reduce the defened income tax assets to the amount expected to be realized. ASC 7 40 provides guidance for how unce1iain tax positions should be recognized, measured, presented, and disclosed in the fmancial statements. ASC 740 requirns the evaluation of tax positions taken or expected to be taken in the course of prepai·ing the Company's tax returns to determine whether the tax positions are "more-likely-than-not" threshold would be recorded as a tax benefit or expense in the cunent yeai·. The tax years that remain subject to examination ai·e 2022, 2021, and 2020. The Company determined that there ai·e no unce11ain tax positions which would requii·e adjustments or disclosures on the financial statements. ### Concentration of Customer Revenue For the yeai· ended December 31, 2023, three customers accounted for 27% of the Company's revenue and also accounted for approximately 18% of the accounts receivable. # **3. NET CAPITAL** The Company is subject to the SEC's Uniform Net Capital Rule (Rule 15c3-l), which requires the maintenance of minimum net capital of \$5,000 or 6 2/3% of total aggregate indebtedness, whichever is higher, and requires that the ratio of aggregate indebtedness to net capital, both as defmed, not to exceed 15 to 1. The rnle also provides that equity capital may not be withdrawn, cash dividends paid or the Company's operations expanded, if the resulting net capital ratio would exceed 10 to **1.** At December 31, 2023, the Company had net capital of \$450,747, which was \$347,244 in excess of the FINRA's minimum net capital requii·ement of \$103,503. At December 31, 2023 the Company's ratio of aggregate indebtedness to net capital was 3 .44 to 1. ## **4. COMMITMENTS AND CONTINGENCIES** ## Leases On November 1, 2010, the Company renewed its operating lease for its office space in White Plains, NY on a month-to-month basis, cancellable with two months written notice. On May 11, 2015, September 15, 2015, Januaiy 3, 2019, and September 10, 2019 the Company amended its operating lease to include more space. On December 30, 2020, the Company amended its operating lease to reduce its amount of space. ## Litigation The Company may be involved in legal proceedings in the ordina1y course of business. Such matters are subject to many unce1iainties, and outcomes are not predictable with assurance. CmTently, the Company is not involved in any legal proceedings which require disclosure. {8}------------------------------------------------ # **5. LIABILITIES SUBORDINATED TO CLAIMS OF GENERAL CREDITORS** The Company is obligated under fom subordination agreements, which are scheduled to mature on the following dates: \$10,000 on Janua1y 15, 2024, \$10,000 on March 1, 2024, \$10,000 on December 16, 2024, and \$150,000 on March 17, 2024. The matmity of these agreements automatically extends for an additional year if the lender does not request repayment thilieen months prior to matmity. The four subordination agreements in the aggregate amount of \$180,000, which are between the lenders and the Company, have been approved by FINRA and, as such, are available for net capital purposes. ## **6. GUARANTEES** F ASB ASC 460, Guarantees, requires the company to disclose info1mation about its obligations under ce1iain guarantee anangements. F ASB ASC 460 defines guarantees as contracts and indemnification agreements that contingently require a guarantor to make payments to the guaranteed pa1iy based on changes in an underlying factor (such as an interest or foreign exchange rate, secmity or commodity price, an index or the occmTence or nonoccmTence of a specified event) related to an asset, liability, or equity security of a guaranteed paiiy. This guidance also defines guarantees as contracts that contingently requiI·e the guarantor to make payments to the guaranteed pa1iy based on another entity's failure to perf01m under an agreement as well as indirect guarantees of the indebtedness of others. The Company has issued no guarantees effective at December 31, 2023 or during the year then ended. ## 7. **SUBSEQUENT EVENTS** The Company evaluated events occmTing between the end of its fiscal year, December 31 , 2023, and the auditor's rep01i date, when the financial statements were issued. All subsequent events requiring recognition as of the auditor's repoti date, have been incorporated into these financial statements herein. Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.