# HERITAGE FINANCIAL SYSTEMS, LLC X-17A-5 (2023-02-27) — Broker-dealer annual report - Company: HERITAGE FINANCIAL SYSTEMS, LLC - Form: X-17A-5 - Filed: 2023-02-27 - Period: 2022-12-31 - Accession: 0001304359-23-000001 - CIK: 1304359 - File #: 8-66670 - Type: Broker-dealer - Material weakness: Yes - Auditor: MorisonCogen LLP - Auditor location: Blue Bell, PA - Contact: Brian K. Lureen - Phone: 610-889-2066 - Email: blureen@heritagefincorp.com - Website: heritagefincorp.com - Signed by: Brian K. Lureen (President & CEO) Original filing: https://www.sec.gov/Archives/edgar/data/1304359/000130435923000001/hfsauditsec.pdf --- {0}------------------------------------------------ HERITAGE FINANCIAL SYSTEMS, LLC FINANCIAL STATEMENTS DECEMBER 31, 2022 AND 2021 ![](_page_0_Picture_1.jpeg) ![](_page_0_Picture_2.jpeg) {1}------------------------------------------------ # **UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549** OMB APPROVAL OMB Number: ϯϮϯϱͲϬϭϮϯ Expires: KĐƚ͘ϯϭ͕ϮϬϮϯ Estimated average burden hours per response: # **ANNUAL REPORTS FORM X-17A-5 PART III** **FACING PAGE** SEC FILE NUMBER 8-66670 **Information Required Pursuant to Rules 17a-5, 17a-12, and 18a-7 under the Securities Exchange Act of 1934** FILING FOR THE PERIOD BEGINNING \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ AND ENDING \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ MM/DD/YY MM/DD/YY **A. REGISTRANT IDENTIFICATION** NAME OF FIRM: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ 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.) \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ (No. and Street) \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ (City) (State) (Zip Code) 1/01/2022 12/31/2022 Heritage Financial Systems, LLC 5 Great Valley Parkway, Suite 334 Malvern PA 19355 #### PERSON TO CONTACT WITH REGARD TO THIS FILING ■ | Brian K. Lureen | (610) 889-2066
_____________________________________________________________________________________ | blureen@heritagefincorp.com | | |-----------------|---------------------------------------------------------------------------------------------------------|-----------------------------|--| | (Name) | (Area Code – Telephone Number) | (Email Address) | | # INDEPENDENT PUBLIC ACCOUNTANT whose reports are contained in this filing\* \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ (Name – if individual, state last, first, and middle name) \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ (Address) (City) (State) (Zip Code) \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ (Date of Registration with PCAOB)(if applicable) (PCAOB Registration Number, if applicable) **FOR OFFICIAL USE ONLY** Blue Bell PA 19422 October 20, 2003 00536 Morison Cogen LLP 484 Norristown Road, Suite **B. ACCOUNTANT IDENTIFICATION** \* 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)(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.** {2}------------------------------------------------ | Brian K. Lureen | swear (or affirm) that, to the best of my knowledge and belief, the | | | |-------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------|--|--| | financial report pertaining to the firm of Heritage Financial Systems, LLC | as of | | | | December 31 | 2 022 | | | | partner, officer, director, or equivalent person, as the case may be, has any proprietary interest in any account classified solely | | | | | ac that of a customer | | | | | Signature: / | | |------------------------------|--| | Title :-
CESIdENT
CE U | | - - - - - - - - - - - - - - - - - - - - - - - - - - {3}------------------------------------------------ # HERITAGE FINANCIAL SYSTEMS, LLC # C O N T E N T S | | PAGE | |-------------------------------------------------------------------------------------------|------| | REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM | 1 | | STATEMENTS OF FINANCIAL CONDITION | 2 | | STATEMENTS OF COMPREHENSIVE LOSS | 3 | | STATEMENT OF CHANGES IN MEMBER'S CAPITAL AND
STOCKHOLDER'S EQUITY | 4 | | STATEMENTS OF CASH FLOWS | 5 | | NOTES TO FINANCIAL STATEMENTS | 6 | | SUPPLEMENTARY INFORMATION | | | Computation of Net Capital Under Rule 15c3-1 of the Securities and
Exchange Commission | 9 | | OTHER MATTERS | | | Report of Independent Registered Public Accounting Firm
on Exemption Report | 10 | | Heritage Financial Systems, LLC
Exemption Report | 11 | {4}------------------------------------------------ ![](_page_4_Picture_0.jpeg) # REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Members and Board of Directors of Heritage Financial Systems, LLC Malvern,Pennsylvania # **Opinion on the Financial Statements** We have audited the accompanying statements of financial condition of Heritage Financial Systems, LLC (the Company) as of December 31, 2022 and 2021, and the related statements of comprehensive loss, changes in members' capital and stockholders' equity, and cash flows for each of the years in the two-year period ended December 31, 2022 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 the Company as of December 31, 2022 and 2021, and the results of its operations and its cash flows for each of the years in the two-year period ended December 31, 2022, in conformity with accounting principles generally accepted in the United States of America. # **Basis for Opinion** These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. 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 the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits 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 audits 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 audits also included evaluating the accounting principles used and significant estimates made by management, as wellas evaluating the overall presentation of the financial statements.We believe that our audits provide a reasonable basis for our opinion. # **Report on Supplemental Information** The Computation of Net Capital Under Rule 15c3-1 of the Securities and Exchange Commission has been subjected to audit procedures performed in conjunction with the audit of Heritage Financial Systems, LLC's financial statements. The Computation of Net Capital Under Rule 15c3-1 of the Securities and Exchange Commission is the responsibility of Heritage Financial Systems, LLC's management. Our audit procedures included determining whether the Computation of Net Capital Under Rule 15c3-1 of the Securities and Exchange Commission 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 Computation of Net Capital Under Rule 15c3-1 of the Securities andExchange Commission. In forming our opinion on the Computation of Net Capital Under Rule 15c3-1 of the Securities and Exchange Commission, we evaluated whetherthe Computation of Net Capital Under Rule 15c3-1 of theSecurities and ExchangeCommission, including its form and content, is presented in conformity with 17 C.F.R. § 240.17a-5. In our opinion, the Computation of Net Capital Under Rule 15c3-1 of the Securities and Exchange Commission is fairly stated, in all material respects, in relation to the financial statements as a whole. We have served as the Company's auditor since 2009. Blue Bell, Pennsylvania February 24, 2023 {5}------------------------------------------------ ### HERITAGE FINANCIAL SYSTEMS, LLC STATEMENTS OF FINANCIAL CONDITION DECEMBER 31, 2022 AND 2021 | | 2022 | 2021 | |-------------------------------------------------------------------------------|--------------------------------|-------------------------------| | ASSETS | | | | CURRENT ASSETS
Cash
Commissions receivable
Non-allowable receivables | \$
13,631
1,250
1,250 | \$
8,676
1,250
1,250 | | TOTAL ASSETS | \$
16,131 | \$
11,176 | | LIABILITIES AND MEMBERS' CAPITAL | | | | CURRENT LIABILITIES
Commissions payable and accrued expenses | \$
- | \$
334 | | TOTAL LIABILITIES | - | 334 | | MEMBER'S CAPITAL | | | | MEMBERS' CAPITAL – 1,000 Series A Units | 474,370 | 434,374 | | ACCUMULATED DEFICIT | (458,239) | (423,528) | | TOTAL MEMBER'S CAPITAL | 16,131 | 10,842 | | TOTAL LIABILITIES AND MEMBER'S CAPITAL | \$
16,131 | \$
11,176 | {6}------------------------------------------------ #### HERITAGE FINANCIAL SYSTEMS, LLC STATEMENTS OF COMPREHENSIVE LOSS YEARS ENDED DECEMBER 31, 2022 AND 2021 | | 2022 | 2021 | |-----------------------------------------|--------------|-------------| | REVENUE
Commissions and other income | \$
37,820 | \$ 93,207 | | OPERATING EXPENSES | 72,531 | 119,693 | | NET LOSS | \$ (34,711) | \$ (26,486) | {7}------------------------------------------------ #### HERITAGE FINANCIAL SYSTEMS, LLC STATEMENT OF CHANGES IN MEMBER'S CAPITAL AND STOCKHOLDER'S EQUITY YEARS ENDED DECEMBER 31, 2022 AND 2021 | | | Common
Stock | | Additional
Paid-in
Capital | | Member's
Capital | | Accumulated
Deficit | | Total
Member's
Capital and
Stockholder's
Equity | | |--------------------------------------------------|----|-----------------|----|----------------------------------|----|---------------------|----|------------------------|----|-------------------------------------------------------------|--| | BALANCE -
JANUARY 1, 2021 | \$ | 25,000 | \$ | 403,370 | \$ | 428,370 | \$ | (397,042) | | \$ 31,328 | | | CONVERSION TO LLC | | (25,000) | | (403,370) | | - | | - | | - | | | CONTRIBUTED CAPITAL | | - | | - | | 6,000 | | - | | 6,000 | | | NET LOSS FOR THE YEAR ENDED
DECEMBER 31, 2021 | | - | | - | | - | | (26,486) | | (26,486) | | | BALANCE -
DECEMBER 31, 2021 | | - | | - | | 434,370 | | (423,528) | | 10,842 | | | CONTRIBUTED CAPITAL | | - | | - | | 40,000 | | - | | 40,000 | | | NET LOSS FOR THE YEAR ENDED
DECEMBER 31, 2022 | | - | | - | | - | | (34,711) | | (34,711) | | | BALANCE -
DECEMBER 31, 2022 | \$ | - | \$ | - | \$ | 474,370 | \$ | (458,239) | \$ | 16,131 | | {8}------------------------------------------------ ## HERITAGE FINANCIAL SYSTEMS, LLC STATEMENTS OF CASH FLOWS YEARS ENDED DECEMBER 31, 2022 AND 2021 | | 2022 | 2021 | | | |-------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------|----------------|--|--| | CASH FLOWS FROM OPERATING ACTIVITIES
Net loss
Adjustments to reconcile net loss to
net cash used in operating activities
Increase (decrease) in liabilities | \$ (34,711) | \$
(26,486) | | | | Commissions payable and accrued expenses | (334) | 334 | | | | Net cash used in operating activities | (35,045) | (26,152) | | | | CASH FLOWS FROM FINANCING ACTIVITIES
Contributed capital | 40,000 | 6,000 | | | | Net cash provided by financing activities | 40,000 | 6,000 | | | | NET CHANGE IN CASH | 4,955 | (20,152) | | | | CASH - BEGINNING OF YEAR | 8,676 | 28,828 | | | | CASH - END OF YEAR | \$
13,631 | \$
8,676 | | | {9}------------------------------------------------ # HERITAGE FINANCIAL SYSTEMS, LLC NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2022 AND 2021 # NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES # Formation and Nature of Operations Heritage Financial Systems, LLC (the company), established in 1999 as a Pennsylvania corporation, is a broker-dealer registered with the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA). The company specializes in financial planning and consulting. On January 1, 2021, the company converted its legal structure from a Pennsylvania corporation to a Pennsylvania limited liability company. ### Revenue Recognition Revenues are recognized at a point in time when the service is performed and reflects the consideration the company expects to be entitled for the service. The company acts as agent for the sale of various investments. The company is a broker-dealer and sells various types of investment options, such as life insurance, variable annuities, mutual funds, private placements, and limited partnership interests. The revenue recognition policy for each type of revenue stream is as follows: # Life Insurance Commission Revenue is recorded when the paperwork is completed, and payment is submitted by the customer, which is the date that the company's performance obligation is satisfied. # Variable Annuities Revenue is recorded when the paperwork is completed and payment is submitted by the customer, which is the date that the company's performance obligation is satisfied. #### Mutual Funds Commissions and related clearing expenses are recorded on the trade date (the date the company fills the trade order by finding and contracting with counterparty and confirms the trade with the customer). The company believes that the performance obligation is satisfied on the trade date because that is when the underlying financial instrument or purchaser is identified, the pricing is agreed upon and the risks and rewards of ownership have been transferred to/from customer. # Private Placements and Limited Partnership Interests Revenue is recorded when the customer authorizes the investment, the paperwork is completed and payment is submitted by the customer, which is the date that the company's performance obligation is satisfied. During the years ended December 31, 2022 and 2021, the company earned \$37,820 and \$93,207 from commissions. # Basis of Presentation The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America. #### Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires the use of estimates based on management's knowledge and experience. Accordingly, actual results could differ from those estimates. {10}------------------------------------------------ # HERITAGE FINANCIAL SYSTEMS, LLC NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2022 AND 2021 # NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) # Commissions Receivable Commissions are recognized as income on a trade-date basis as they become payable by the financial institution or by agreement. Management deems all receivables to be fully collectible. Accordingly, no allowance for bad debts is considered necessary. # Advertising Advertising costs, except for costs associated with direct-response advertising, are charged to operations over when the advertising first takes place. The costs of direct-response advertising are capitalized and amortized over the period during which future benefits are expected to be received. # Comprehensive Income The company follows FASB ASC 220, *Comprehensive Income*. Comprehensive income is a more inclusive financial reporting methodology that includes disclosures of certain financial information that historically has not been recognized in the calculation of net income. Since the company has no items of other comprehensive income (loss), comprehensive loss is equal to net loss. # Income Taxes The company is a limited liability company that is treated as a partnership for income tax purposes. Accordingly, under the Internal Revenue Code, all taxable income or loss flows through to the members of the Company and is reported directly on their tax returns. Therefore, no income tax expense or benefit is recorded in the financial statements of the company. The company is subject to routine audits by taxing authorities; however, there are currently no audits for any tax years in progress. With few exceptions, the federal and state income tax returns filed for the tax years ending on December 31, 2019 and thereafter are subject to examination by the relevant taxing authorities. # Recently Issued Accounting Pronouncements Not Yet Adopted As of December 31, 2022, there are no recently issued accounting standards not yet adopted which would have a material effect on the company's financial statements. # Subsequent Events FASB ASC 855-10 establishes general standards of accounting and disclosure of events that occur after the statement of financial condition date but before the date the financial statements are available to be issued. Subsequent events have been evaluated through February 24, 2023, the date that the financial statements were available to be issued. # NOTE 2 – CONCENTRATION OF CREDIT RISK During the year, the company may have deposits with major financial institutions that exceed Federal Depository Insurance limits of \$250,000. The company is engaged in various trading and brokerage activities in which counterparties primarily include broker-dealers, banks, and other financial institutions. In the event the counterparties do not fulfill their obligations, the company may be exposed to risk. The risk of default depends on the creditworthiness of the counterparty or issuer of the instrument. # NOTE 3 – NON-ALLOWABLE RECEIVABLES Non-allowable receivables represent commission receivables over 30 days old and 12b1 trails more than allowable payables. {11}------------------------------------------------ # HERITAGE FINANCIAL SYSTEMS, LLC NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2022 AND 2021 # NOTE 4 – MAJOR CUSTOMERS For the year ended December 31, 2022, one customer constituted approximately 71% of the total revenue. On December 31,2022, there were no amounts due from this customer. For the year ended December 31, 2021, two customers constituted approximately 59% of the total revenue. On December 31, 2021, there was no amount due from these customers. # NOTE 5 – RELATED PARTY TRANSACTIONS Prior to the conversion to a Pennsylvania limited liability company, the company's parent and other entities that are affiliated by common ownership and are subsidiaries of the parent provide management services for the company. Fees paid for such management services were \$ -0- for the years ended December 31, 2022, and 2021. The company owed its parent \$ -0- for such services as of December 31, 2022 and 2021. Since the lease is in the name of the company's former parent company, the company has no long-term lease obligations. Rent expense recognized for the years ended December 31, 2022 and 2021 was \$2,847 and \$2,120. #### NOTE 6 – NET CAPITAL The company is subject to the SEC Uniform Net Capital Rule (SEC Rule 15c3-1), which requires the maintenance of a minimum net capital, as defined under such provision. Net capital may fluctuate daily. On December 31, 2022, the company had net capital as defined under Rule 15c3-1 of \$14,881, which was \$9,881 more than its required net capital of \$5,000. {12}------------------------------------------------ # HERITAGE FINANCIAL SYSTEMS, LLC COMPUTATION OF NET CAPITAL UNDER RULE 15c3-1 OF THE SECURITIES AND EXCHANGE COMMISSION AS OF DECEMBER 31, 2022 | CAPITAL AND ALLOWABLE SUBORDINATED LIABILITIES
Total members' capital qualified for net capital | \$
16,131 | |----------------------------------------------------------------------------------------------------|--------------| | DEDUCTIONS
Non-allowable assets | | | Commissions receivable,12b1 trails and due to parent company | 1,250 | | NET CAPITAL | \$
14,881 | | AGGREGATE INDEBTEDNESS | \$
- | | COMPUTATION OF BASIC NET CAPITAL REQUIREMENT | | | MINIMUM NET CAPITAL REQUIRED (BASED ON 6 2/3% AGGREGATE
INDEBTEDNESS) | \$
- | | MINIMUM DOLLAR NET CAPITAL REQUIREMENT OF REPORTING | | | DEALER | \$
5,000 | | NET CAPITAL REQUIREMENT | \$
5,000 | | EXCESS NET CAPITAL | \$
9,881 | | RATIO: AGGREGATE INDEBTEDNESS TO NET CAPITAL | 0.00% | The Form X-17a-5 reconciliation is not included as there are no material differences from the company's computation. {13}------------------------------------------------ ![](_page_13_Picture_0.jpeg) # REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Members and Board of Managers of Heritage Financial Systems, LLC Malvern, Pennsylvania We have reviewed management's statement, included in the accompanying Exemption Report in which Heritage Financial Systems, LLC (the "Company") does not claim an exemption from 17 C.F.R. § 240.15c3-3 and (2) Heritage Financial Systems, LLC, as a Non-Covered Firm, is filing the Exemption Report relying on Footnote 74 of the SEC Release No. 34-70073 adopting amendments to 17 C.F.R. § 240.17a-5 (Non-Covered Firm Provision) because the Company limits its business activities exclusively to effecting securities transactions via subscriptions on a subscription basis where the funds are payable to the issuer or its agent and not to the Company and the Company (1) did not directly or indirectly receive, hold, or otherwise owe funds or securities for or to customers, (2) did not carry accounts of or for customers and (3) did not carry PAB accounts (as defined in Rule 15C3-3) throughout the most recent fiscal year without exception. Heritage Financial Systems, LLC's management is responsible for compliance with the Non-Covered Firm 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 Heritage Financial Systems, LLC's compliance with the Non-Covered Firm Provision. A review is substantially less in scope than an examination, the objective of which is the expression of an opinion on management's statement. 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 statement referred to above for them to be fairly stated, in all material respects, based on the Non-Covered Firm Provision. Blue Bell, Pennsylvania February 24, 2023 {14}------------------------------------------------ ![](_page_14_Picture_0.jpeg) Brian K. Lureen *President & CE*O Heritage Financial Systems, LLC's Exemption Report December 31, 2022 Heritage Financial Systems, 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)(1) and (4). To the best of its knowledge and belief, the company states the following: - 1. The company does not claim an exemption under paragraph (k) of 17 C.F.R.§ 240.15c3-3, and - 2. The company is filing this Exemption Report relying on Footnote 74 of the SEC release No. 34- 70073 adopting amendments to 17 C.F.R. § 240.17a-5 because the company limits its business activities exclusively to effecting securities transactions via subscriptions on a subscriptions basis where the funds are payable to the issuer or its agent and not to the company and the company (1) did not directly or indirectly receive, hold, or otherwise owe funds or securities for or to customers, (2) did not and carry accounts of or for customers and (3) did not carry PAB accounts (as defined in Rule 15c3-3) throughout the most recent fiscal year without exception. Heritage Financial Systems, LLC I, Brian K. Lureen, affirm that, to the best knowledge and belief, this Exemption Report is true and correct. By: Title: President & CEO Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.