# PACER FINANCIAL, INC. X-17A-5 (2022-02-18) — Broker-dealer annual report - Company: PACER FINANCIAL, INC. - Form: X-17A-5 - Filed: 2022-02-18 - Period: 2021-12-31 - Accession: 0001337443-22-000001 - CIK: 1337443 - File #: 8-67061 - Type: Broker-dealer - Material weakness: No - Auditor: Sanville and Company - Auditor location: Abington, PA - Contact: John Miller - Phone: 9176206006 - Email: joe.thomson@pacerfinancial.com - Website: pacerfinancial.com - Signed by: Joe M Thomson (Principal Executive Officer) Original filing: https://www.sec.gov/Archives/edgar/data/1337443/000133744322000001/auditpublic.pdf --- {0}------------------------------------------------ **Pacer Financial, Inc. Financial Statement December 31, 2021** {1}------------------------------------------------ | ANNUAL AUDITED FOCUS REPORT FACING PAGE | | |---------------------------------------------------------------------------------------|--| | REPORT OF INDEPENDENT RECISTERED PUBLIC ACCOUNTING FIRM
ON THE FINANCIAL STATEMENT | | | FINANCIAL STATEMENT | | | Statement of Financial Condition | | | Notes to Financial Statement | | {2}------------------------------------------------ ### UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 OMB APPROVAL OMB Number: 3235-0123 Expires: Oct. 31, 2023 Estimated average burden hours per response: 12 SEC FILE NUMBER 8-67061 # ANNUAL REPORTS FORM X-17A-5 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 | | 12/31/21
AND ENDING | | | | | MM/DD/YY | | MM/DD/YY | | | | A. REGISTRANT IDENTIFICATION | | | | | NAME OF FIRM: Pacer Financial, Inc. | | | | | | TYPE OF REGISTRANT (check all applicable boxes):
Broker-dealer
Check here if respondent is also an OTC derivatives dealer | L Security-based swap dealer __ Major security-based swap participant | | | | | ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use a P.O. box no.) | | | | | | 500 Chesterfield Parkway | | | | | | | (No. and Street) | | | | | Malvern | PA | | 19355 | | | (City) | (State) | | (Zip Code) | | | PERSON TO CONTACT WITH REGARD TO THIS FILING | | | | | | Joe M. Thomson | 610-644-8100 | | joe.thomson@pacerfinancial.com | | | (Name) | (Area Code - Telephone Number) | | (Email Address) | | | | B. ACCOUNTANT IDENTIFICATION | | | | | INDEPENDENT PUBLIC ACCOUNTANT whose reports are contained in this filing*
Sanville & Company | | | | | | | (Name - if individual, state last, first, and middle name) | | | | | 1514 Old York Road | Abington | PA | 19001 | | | (Address) | (City) | (State) | (Zip Code) | | 09/18/2003 169 (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. {3}------------------------------------------------ ### OATH OR AFFIRMATION Joe M. Thomson swear (or affirm) that, to the best of my knowledge and belief, the | financial report pertaining to the firm of PacerFinancial, Inc. | | | |-----------------------------------------------------------------|--------|--| | December 31 | , 2021 | | 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. ![](_page_3_Figure_5.jpeg) Signature: Title: Principal Executive Officer Notary Public ## This filing\*\* contains (check all applicable boxes): - = (a) Statement of financial condition. - (b) Notes to consolidated statement of financial condition. - □ (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 § 210.1-02 of Regulation S-X). - | (d) Statement of cash flows. - [ (e) Statement of changes in stockholders' or partners' or sole proprietor's equity. - | (f) Statement of changes in liabilities subordinated to claims of creditors. - [ (g) Notes to consolidated financial statements. - [ (h) Computation of net capital under 17 CFR 240.15c3-1 or 17 CFR 240.18a-1, as applicable. - [ (i) Computation of tangible net worth under 17 CFR 240.18a-2. - □ (j) Computation for determination of customer reserve requirements pursuant to Exhibit A to 17 CFR 240.15c3-3. - □ (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. - [1) Computation for Determination of PAB Requirements under Exhibit A to § 240.15c3-3. - [ (m) Information relating to possession or control requirements for customers under 17 CFR 240.15c3-3. - □ (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. - □ (o) Reconciliations, including appropriate explanations, of the FOCUS Report with computation of net capital or tangible net worth under 17 CFR 240.15c3-1, 17 CFR 240.18a-2, or 17 CFR 240.18a-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. - □ (p) Summary of financial data for subsidiaries not consolidated in the statement of financial condition. - @ (q) Oath or affirmation in accordance with 17 CFR 240.17a-5, 17 CFR 240.17a-12, or 17 CFR 240.18a-7, as applicable. - | (r) Compliance report in accordance with 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable. - [s) Exemption report in accordance with 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable. - @ (t) Independent public accountant's report based on an examination of the statement of financial condition. - □ {u} Independent public accountant's report based on an examination of the financial statements under 17 CFR 240.17a-5, 17 CFR 240.18a-7, or 17 CFR 240.17a-12, as applicable. - □ {v} Independent public accountant's report based on an examination of certain statements in the compliance report under 17 CFR 240.17a-5 or 17 CFR 240.18a-7, 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. - O (x) Supplemental reports on applying agreed-upon procedures, in accordance with 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 material inadequacies exist, under 17 CFR 240.17a-12(k). - □ (z) Other: - \*\* To request confidential treatment of certain portions of this filing, see 17 CFR 240.170-5(e)(2), as applicable. {4}------------------------------------------------ ROBERT F. SANVILLE, CPA MICHAEL T. BARANOWSKY, CPA JOHN P. TOWNSEND, CPA NATHANIEL S. HARTGRAVES, CPA *Sanville & Company* CERTIFIED PUBLIC ACCOUNTANTS 1514 OLD YORK ROAD ABINGTON, PA 19001 (215) 884-8460 (215) 884-8686 FAX MEMBERS OF AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS PENNSYLVANIA INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS 100 WALL STREET, 8th FLOOR NEW YORK, NY 10005 (212) 709-9512 # **REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM** Board of Directors Pacer Financial, Inc. #### **Opinion on the Financial Statement** We have audited the accompanying statement of financial condition of Pacer Financial, Inc. (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 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 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 2006 Abington, Pennsylvania February 1, 2022 {5}------------------------------------------------ # **Pacer Financial, Inc. Statement of Financial Condition December 31, 2021** #### **Assets** | Cash and cash equivalents
Due from affiliate
Other assets | \$
2,623,654
384,511
5,719 | |------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------| | Total assets | \$
3,013,884 | | Liabilities and Stockholders' Equity | | | Liabilities
Accrued interest payable to stockholder
Accrued expenses | \$
274,512
13,466
287,978 | | Commitments and contingencies and guarantees:
Subordinated borrowings | 600,000 | | Total liabilities | 887,978 | | Stockholders' Equity
Common stock, no par value, Class A voting, -1,000 shares
authorized, 1,000 issued and outstanding
Common stock, no par value, Class B non-voting, -100,000 shares
authorized, 100,000 issued and outstanding | 100,000 | | Additional paid-in capital
Accumulated deficit | 13,659,870
(11,633,964) | | Total stockholders' equity | 2,125,906 | | Total liabilities and stockholders' equity | \$
3,013,884 | The accompanying notes are an integral part of this financial statement. {6}------------------------------------------------ ## **1. Organization** Pacer Financial, Inc. ("The Company") is a registered broker dealer with the Securities and Exchange Commission ("SEC") and is a member of the Financial Industry Regulatory Authority ("FINRA"). The Company is incorporated under the laws of the Commonwealth of Pennsylvania. The Company, like other broker dealers and investment advisors, is directly affected by general economics and market conditions, including fluctuations in volume and price level of securities, changes in interest rates and securities brokerage services, all of which have an impact on the Company's liquidity. # **2. Summary of Significant Accounting Policies** ## *The following are the significant accounting policies followed by the Company:* *Revenue –* In accordance with ASC 606, revenue from the sale of mutual funds, variable annuities and exchange traded funds is recognized when it is earned. Marketing fee revenue is recognized when earned, based on the terms of the underlying agreement. *Concentration of credit risks* - The Company maintains its cash in bank deposit accounts that, at times, may exceed federally insured limits. The Company has not experienced any losses in such accounts. Management believes the Company is not exposed to any significant credit risk related to cash. *Cash and cash equivalents -* The Company includes as cash and cash equivalents amounts invested in money market mutual funds. *Income taxes* – The Company has elected to be taxed under the provision of Subchapter S of the Internal Revenue Code and similar state provisions. Under these provisions, the Company does not pay federal or state corporate income taxes on its taxable income. Accordingly, no provision has been made for federal or state income tax for the year ended December 31, 2021, in the accompanying financial statement. The Company recognizes and discloses uncertain tax positions in accordance with accounting principles generally accepted in the United States of America (GAAP). As of, and during the year ended December 31, 2021 the Company did not have liability for unrecognized tax benefits. The Company is no longer subject to examination by federal and state taxing authorities prior to 2018. *Fair value -* The Company utilizes various methods to measure the fair value of most of its investments on a recurring basis. GAAP establishes a hierarchy that prioritizes inputs to valuation techniques used to measure fair value. The three levels of inputs are as follows: *Level 1.* Unadjusted quoted prices in active markets for identical assets or liabilities that the company has the ability to access. *Level 2.* Observable inputs other than quoted prices included in level 1 that are observable for the asset or liability either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates, and similar data. {7}------------------------------------------------ # **2. Summary of Significant Accounting Policies (Continued)** *Level 3.* Unobservable inputs for the asset or liability to the extent that relevant observable inputs are not available, representing the company's own assumptions about the assumptions that a market participant would use in valuing the asset or liability, and that would be based on the best information available. The availability of observable inputs can vary from security to security and is affected by a wide variety of factors, including, for example, the type of security, whether the security is new and not yet established in the marketplace, the liquidity of markets, and other characteristics particular to the security. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in level 3. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement falls in its entirety is determined based on the lowest level input that is significant to the fair value measurement in its entirety. Investments in money market funds, are valued at the money market fund's net asset value per share. The following table summarizes the valuation of the Company's investments by the above fair value hierarchy levels as of December 31, 2021: | Securities owned: | Level 1 | Level 2 | Level 3 | |---------------------------------|---------------|---------|---------| | Money market funds (included in | | | | | cash and cash equivalents) | \$
158,089 | \$
- | \$
- | *Use of Estimates* - The preparation of financial statements in conformity with generally accepted accounting principles 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 reported amounts of revenues and expenses during the reporting period. Actual results may differ from those estimates and assumptions. *Subsequent events* - Management has evaluated the impact of all subsequent events through February 1, 2022 the date the financial statement was available to be issued and has determined that there were no subsequent events requiring disclosure in these financial statements. # **3. Net Capital Requirements** The Company is a member of the FINRA and is subject to the SEC Uniform Net Capital Rule 15c3-1. This Rule requires the maintenance of minimum net capital and requires that the ratio of aggregate indebtedness to net capital, both as defined, shall not exceed 15 to 1. {8}------------------------------------------------ ## **3. Net Capital Requirements (Continued)** At December 31, 2021, the Company's net capital was \$2,332,514 which was \$2,327,514 in excess of its minimum requirement of \$5,000. The Company's net capital ratio was 0.01 to 1. # **4. Liabilities Subordinated to Claims of General Creditors** There are two borrowings under subordination agreements at December 31, 2021. The first is a \$200,000 Subordinated Loan Agreement bearing interest at 6% and the second borrowing is a \$400,000 Subordinated Loan Agreement bearing interest at 5%. Each Subordinated Loan Agreement contain rollover provisions which allow for automatic renewal without FINRA approval. The borrowings are available in computing the net capital under the SEC's uniform net capital rule. To the extent that such borrowings are required for the Company's continued compliance with the minimum net capital requirements, it may not be repaid. The borrowings were funded by the one of the Company's stockholders. Interest expense for the year ended December 31, 2021 under such borrowings was \$32,000. Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.