# EUROCONSULT CAPITAL, LLC X-17A-5 (2024-02-27) — Broker-dealer annual report - Company: EUROCONSULT CAPITAL, LLC - Form: X-17A-5 - Filed: 2024-02-27 - Period: 2023-12-31 - Accession: 0001390422-24-000001 - CIK: 1390422 - File #: 8-67554 - Type: Broker-dealer - Material weakness: No - Auditor: McBee & Co., P.C. - Auditor location: Dallas, TX - Contact: Evan Yellin - Phone: 212-972-4300 - Email: evan.yellin@ec-ma.com - Website: ec-ma.com - Signed by: Evan Yellin (Designated Principal) Original filing: https://www.sec.gov/Archives/edgar/data/1390422/000139042224000001/euroconsult.pdf --- {0}------------------------------------------------ | | urs per response: | 12 | | |--|-------------------|----|--| | | | | | | | SEC FILE NUMBER | | | | | O CTECA | | | | | (No. and Street) | | | |------------------------------------------------------------------------------------------------|------------------------------------------------------------|--------------------------------------------|-----------------------| | New York | NY | | 10022 | | (City) | (State) | | (Zip Code) | | PERSON TO CONTACT WITH REGARD TO THIS FILING | | | | | Evan Yellin | 212-972-4300 | | evan.yellin@ec-ma.com | | (Name) | (Area Code - Telephone Number) | (Email Address) | | | | B. ACCOUNTANT IDENTIFICATION | | | | INDEPENDENT PUBLIC ACCOUNTANT whose reports are contained in this filing*
McBee & Co., P.C. | | | | | | (Name - if individual, state last, first, and middle name) | | | | 718 Paulus Avenue | Dallas | Texas | 75214 | | (Address) | (City) | (State) | (Zip Code) | | 09/22/2009 | | 3631 | | | (Date of Registration with PCAOB)(if applicable) | | (PCAOB Registration Number, if applicable) | | | | FOR OFFICIAL USE ONLY | | | | | | | | {1}------------------------------------------------ | Evan Yellin | swear (or affirm) that, to the best of my knowledge and belief, the | |---------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------| | financial report pertaining to the firm of EuroConsult Capital, LLC | , as of | | 12/31 | 2023 | | | 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. FERNANDO O. KOATZ
NOTARY PUBLIC-STATE OF NEW YORK
No. 02KO4956693
Qualified in Queens County
My Commission Explres _ | Signature:
2-7
Title: MArderhirth DIM274-
Designated Principal | - - - - - - - - - - - - - - - - - - - - - - - - - - - {2}------------------------------------------------ For the Year Ended December 31, 2019 ## TABLE OF CONTENTS December 31, 2023 | | PAGE | |---------------------------------------------------------------------------------------------------------|-------| | REPORT OF INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM ON THE FINANCIAL STATEMENTS | 1 | | FINANCIAL STATEMENTS | | | Statement of Financial Condition | 2 | | Statement of Operations | 3 | | Statement of Changes in Member's Equity | 4 | | Statement of Cash Flows | 5 | | Notes to Financial Statements | 6-9 | | SUPPLEMENTAL INFORMATION | | | Schedule I - Computation of Net Capital Under Rule 15c3-1 of the
Securities and Exchange Commission | 10-11 | | Schedule II - Statement Regarding Reserve Requirements and
Possession or Control Requirements | | | | 12 | | ADDITIONAL REPORTS AND RELATED INFORMATION | | | Report of Independent Registered Public Accounting Firm on the
Exemption from SEC Rule 15c3-3 Report | 13 | | EuroConsult Capital LLC's Exemption Report | 14 | {3}------------------------------------------------ ![](_page_3_Picture_0.jpeg) ### **REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM** #### **To the Managing Director and Member of EuroConsult Capital LLC** #### **Opinion on the Financial Statements** We have audited the accompanying statement of financial condition of EuroConsult Capital LLC as of December 31, 2023, the related statements of operations, changes in member's equity, and cash flows for the year then ended, 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 EuroConsult Capital LLC as of December 31, 2023, and the results of its operations and its cash flows for the year then ended in conformity with accounting principles generally accepted in the United States of America. #### **Basis for Opinion** These financial statements are the responsibility of EuroConsult Capital LLC's management. Our responsibility is to express an opinion on EuroConsult Capital LLC's financial statements 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 EuroConsult Capital 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 statements are 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 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 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. #### **Auditor's Report on Supplemental Information** The supplemental information contained in Schedule I, Computation of Net Capital Under Rule 15c3-1 of the Securities and Exchange Commission ("Schedule I") and Schedule II, Statement Regarding Reserve Requirements and Possession or Control Requirements ("Schedule II") has been subjected to audit procedures performed in conjunction with the audit of EuroConsult Capital LLC's financial statements. The supplemental information is the responsibility of EuroConsult Capital LLC's management. Our audit procedures included determining whether the supplemental information 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 supplemental information. In forming our opinion on the supplemental information, we evaluated whether the supplemental information, including its form and content, is presented in conformity with 17 C.F.R. §240.17a-5. In our opinion, the supplemental information contained in Schedule I and Schedule II is fairly stated, in all material respects, in relation to the financial statements as a whole. **McBee & Co., PC** We have served as EuroConsult Capital LLC's auditor since 2014. Dallas, Texas February 15, 2024 Dallas Office 718 Paulus Avenue • Dallas, Texas 75214 • 214.823.3500 www.mcbeeco.com {4}------------------------------------------------ ## STATEMENT OF FINANCIAL CONDITION ### As of December 31, 2023 #### ASSETS | Cash | | \$
100,117 | |---------------------------------------|--------------|---------------| | Prepaid Expenses | | 52,832 | | | TOTAL ASSETS | \$
152,949 | | LIABILITIES AND MEMBER'S EQUITY | | | | Liabilities: | | | | | | | | Accounts Payable | | \$
19,110 | | TOTAL LIABILITIES | | 19,110 | | MEMBER'S EQUITY | | 133,839 | | | | | | TOTAL LIABILITIES AND MEMBER'S EQUITY | | \$
152,949 | {5}------------------------------------------------ ## STATEMENT OF OPERATIONS For the Year Ended December 31, 2023 #### REVENUE | Success Fees | | \$
972,170 | |--------------------------------|----------------|---------------| | | TOTAL REVENUE | 972,170 | | EXPENSES | | | | Administrative Management Fees | | 44,748 | | Professional Fees | | 40,830 | | Technology and Communications | | 128,607 | | General and Administrative | | 16,719 | | | TOTAL EXPENSES | 230,904 | | NET INCOME | | \$
741,266 | | | | | {6}------------------------------------------------ ## STATEMENT OF CHANGES IN MEMBER'S EQUITY | For the Year Ended December 31, 2023 | | |--------------------------------------|---------------| | MEMBER'S EQUITY, BEGINNING OF YEAR | \$
49,347 | | Member's Contributions | 147,375 | | Member's Distributions | (804,149) | | Net Income | 741,266 | | MEMBER'S EQUITY, END OF YEAR | \$
133,839 | {7}------------------------------------------------ ## **STATEMENT OF CASH FLOWS** ## **For the Year Ended December 31, 2023** ## **Cash Flows from Operating Activities** | Net Income | \$
741,266 | |--------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------| | Adjustments to Reconcile Net Income to Net Cash
Provided by (Used by) Operating Activities: | | | Non-cash Contributions of Administrative Management Fees | 17,376 | | Change in operating assets and liabilities:
Increase in prepaid expenses
Increase in accounts payable
Decrease in affiliate payables
Total adjustments | (40,740)
13,390
(9,918)
(19,892) | | Net Cash Provided by Operating Activities | 721,374 | | Cash Flows from Financing Activities | | | Member's contributions | 130,000 | | Member's distributions | (804,149) | | Net Cash Used in Financing Activities | (674,149) | | Net Increase in Cash | 47,225 | | Beginning of Year | 52,892 | | End of Year | \$
100,117 | | Supplemental Cash Flow Information | | | Non-cash Activity:
Intercompany Payables Converted
to Member Contributions | \$
17,376 | *See Accompanying Notes to Financial Statements* 5 {8}------------------------------------------------ ## **NOTES TO FINANCIAL STATEMENTS December 31, 2023** ## **1. Nature of business and summary of significant accounting policies** ## *Nature of Business* EuroConsult Capital LLC (the "Company") is a New York limited liability company, which was formed in November 2006. The Company, which is a wholly-owned subsidiary of EuroConsult, Inc, a New York corporation (the "Parent"), is a brokerdealer registered with the SEC and FINRA and a member of Securities Investor Protection Corporation, Inc. The Company's principal activity is to advise and consult with institutional investors and commercial entities concerning mergers and acquisitions. The U.S. dollar (\$) is the functional currency of the Company. The Company is considered a Non-Covered Firm exempt from 17 C.F.R. § 240.15c-3- relying on Footnote 74 of the SEC Release No. 34-71073 adopting amendments to 17 C.F.R. § 240.17a-5. The Company limits its business activities exclusively to mergers and acquisitions and private placement of securities. ## *Basis of Presentation* The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America ("GAAP"). The Company has evaluated events that have occurred subsequent to December 31, 2023, and through February 15, 2024, the date the report was available to be issued. There have been no material subsequent events that occurred during such period that would require disclosure in this report or would be required to be recognized in the financial statements as of December 31, 2023. ## *Use of Estimates* The preparation of financial statements in conformity with United States generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of the 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 could differ from those estimates. {9}------------------------------------------------ ## **EUROCONSULT CAPITAL LLC NOTES TO FINANCIAL STATEMENTS (Continued) December 31, 2023** ## *Revenue Recognition* The Company enters into agreements with customers to provide the services defined in each contract. Generally, the Company receives private placement and success fees for mergers and acquisitions. Some other services include investment advisory services for structuring investments. Significant judgment is required to determine whether performance obligations are satisfied at a point in time or over time; how to allocate transaction prices where multiple performance obligations are identified; when to recognize revenue based on the appropriate measure of the Company's progress under the contract; whether revenue should be presented gross or net of certain costs; and whether constraints on variable consideration should be applied due to uncertain future events. The compensation structures of the placement and success fees are defined in the contracts and are generally paid to the Company for successfully closing a transaction. The Company satisfies its performance obligations upon consummating the transaction defined in the contracts. These performance obligations are typically facilitating capital raises for the client or closing a defined transaction. These fees are generally variable and the estimate of variable consideration is typically constrained in accordance with paragraphs 606-10-32-11 through 32-13 of (ASU) No. 2014-09 because of the uncertainty associated with the variable consideration. Specifically, the amount of consideration is highly susceptible to factors outside the entity's influence, resolution of related uncertainties can take an extended period of time, price concessions could occur and there is a large number and broad range of possible outcomes. Revenue is recognized from the satisfaction of the performance obligation based on the amount the Company has a right to invoice and that amount directly corresponds with the value to the customer of the performance completed to date. ## *Income Taxes* The Company is treated as a flow-through entity for income tax purposes. As a result, the net taxable income of the Company and any related tax credits, for federal income tax purposes, are deemed to pass to the Parent and are included in the Parent's tax returns even though such net taxable income or tax credits may not actually have been distributed. Accordingly, no tax provision has been made in the financial statements since the income tax is a personal obligation of the parent. The Company is subject to state income tax. The Company has not recorded provisions for estimated New York margin taxes for the year ended December 31, 2023, as they are not significant. {10}------------------------------------------------ ## **NOTES TO FINANCIAL STATEMENTS (Continued) December 31, 2023** The Company recognizes and measures any unrecognized tax benefits in accordance with Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 740, "Income Taxes". Under that guidance the Company assesses the likelihood, based on their technical merit, that tax positions will be sustained upon examination based on the facts, circumstances and information available at the end of each period. The measurement of unrecognized tax benefits is adjusted when new information is available, or when an event occurs that requires a change. As of December 31, 2023, the Company believes there are no uncertain tax positions that qualify for either recognition or disclosure in the financial statements. ## **2. Related party transactions** ## *Service Agreement* Pursuant to a service agreement, the Company's Parent provides various services and other operating assistance to the Company. These include professional services, physical premises, utilities, the use of fixed assets, travel, insurance, subscriptions, taxes, personnel and other general and administrative services. The total amount incurred and paid by the Company under this agreement was \$44,748 for the year ended December 31, 2023. These expenses are reflected in administrative management fees in the accompanying Statement of Operations. This Agreement was effective for an initial term of one year and is renewed automatically for successive one-year terms unless terminated by either party upon thirty (30) days written notice. The Company and its Parent are under common control and the existence of that control may create a financial position and operating results significantly different than if the companies were autonomous. ## **3. Net capital requirement** The Company is subject to the Securities and Exchange Commission Uniform Net Capital Rule 15c3-1. This Rule requires the maintenance of minimum net capital and that the ratio of aggregate indebtedness to net capital, both as defined, shall not exceed 15 to 1 and that equity capital may not be withdrawn or cash dividends paid if the resulting net capital ratio would exceed 10 to 1. At December 31, 2023, the Company's net capital was \$81,007, which was \$76,007 in excess of its minimum requirement of \$5,000. The Company's net capital ratio was 0.24 to 1 for December 31, 2023. {11}------------------------------------------------ ## **NOTES TO FINANCIAL STATEMENTS (Continued) December 31, 2023** Capital contributions and distributions to the members can be made under a capital policy approved by the Company's member. Periodic contributions and/or distributions approved by the member may be made in order to enable the member to effectively manage the Company. ## **4. Concentration of risks** The Company is engaged in brokerage activities in which it engages in investment activities with companies throughout the United States. 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. It is the Company's policy to review, as necessary, the credit standing of each counter-party. The Company's financial instruments that are subject to concentrations of credit risk primarily consist of cash. The Company places its cash with two high credit quality institutions. At times, such cash may be in excess of the FDIC insurance limits. The Company believes that it is not exposed to any significant risk related to cash. During the year ended December 31, 2023, 100% of the Company's success fees were from two customers. ## **5. Contingencies** In the ordinary course of conducting its business, the Company may be subjected to loss contingencies arising from lawsuits. Management believes that the outcome of such matters, if any, will not have a material impact on the Company's financial condition or results of future operations. ## **6. Recently issued accounting pronouncements** Recently issued accounting standards that have been issued or proposed by the FASB or other standards setting bodies, are not expected to have a material impact on the Company's financial position or results of its operations. {12}------------------------------------------------ ## **SCHEDULE I** ## **COMPUTATION OF NET CAPITAL UNDER RULE 15c3-1 OF THE SECURITIES AND EXCHANGE COMMISSION** ### **As of December 31, 2023** ## **COMPUTATION OF NET CAPITAL** | Total Member's Equity Qualified for Net Capital | \$
133,839 | |--------------------------------------------------------------------------------------------------------------------------------------------|---------------| | Add: | | | Other deductions or allowable credits | - | | Total capital and allowable subordinated liabilities | 133,839 | | Deductions and/or charges: | | | Prepaid expenses | 52,832 | | Net capital before haircuts on securities positions
Haircuts on securities (computed, where applicable,
pursuant to Rule 15c3-1 (f)) | 52,832
- | | Net Capital | \$
81,007 | | AGGREGATE INDEBTEDNESS | | | Items included in statement of financial condition: | | | Accounts payable | \$
19,110 | | Total Aggregate Indebtedness | \$
19,110 | {13}------------------------------------------------ ## **SCHEDULE I, CONTINUED** ## **COMPUTATION OF NET CAPITAL UNDER RULE 15c3-1 OF THE SECURITIES AND EXCHANGE COMMISSION** ## **As of December 31, 2023** ## **COMPUTATION OF BASIC NET CAPITAL REQUIREMENT** | Minimum Net Capital Required (6 2/3% of Total Aggregate
Indebtedness) | \$
1,275 | |-------------------------------------------------------------------------------------------------------------------------------------------------------|--------------| | Minimum Dollar Net Capital Requirement of Reporting
Broker or Dealer | \$
5,000 | | Net Capital Requirement (greater of above two
minimum requirement amounts) | \$
5,000 | | Excess Net Capital | \$
76,007 | | Net Capital less greater of 10% of Total Aggregate Indebtedness
or 120% of Minimum Dollar Net Capital Requirement of Reporting
Broker or Dealer | \$
75,007 | | Ratio: Aggregate Indebtedness to Net Capital | .24 to 1 | ## **RECONCILIATION WITH COMPANY'S COMPUTATION** The above computation does not differ from the computation of net capital under Rule 15c3-1 as of December 31, 2023 and the corresponding unaudited filing of Part IIA of the FOCUS Report/Form X-17A-5 filed by EuroConsult Capital LLC. Accordingly, no reconciliation is necessary. {14}------------------------------------------------ ## **SCHEDULE II** ## **STATEMENT REGARDING RESERVE REQUIREMENTS AND POSSESSION OR CONTROL REQUIREMENTS** **For the Year Ended December 31, 2023** ## **EXEMPTIVE PROVISIONS** The Company is considered a Non-Covered Firm exempt from 17 C.F.R. § 240.15c3-3 relying on Footnote 74 of the SEC Release No. 34-70073 adopting amendments to 17 C.F.R § 240.17a-5. The Company limits its business activities exclusively to mergers and acquisitions and private placement of securities. The Company does not hold funds or securities. As a Non-Covered Firm, the Computation for Determination of Customer Requirements and Information Relating to Possession or Control Requirements for Customers are not required. {15}------------------------------------------------ ![](_page_15_Picture_0.jpeg) #### **REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM** #### **To the Managers and Member of EuroConsult Capital LLC** We have reviewed management's statements, included in the accompanying Rule 15c3-3 Exemption Report pursuant to SEC Rule 17a-5, in which (1) EuroConsult Capital LLC ("the Company") did not claim an exemption under paragraph (k) of 17 C.F.R. § 240.15c3-3, and (2) the Company 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 because the Company limits its business activities exclusively to (1) mergers and acquisitions and (2) private placement of securities. In addition, the Company did not directly or indirectly receive, hold, or otherwise owe funds or securities for or to customers, other than money or other consideration received and promptly transmitted in compliance with paragraph (a) or (b)(2) of Rule 15c2-4 and/or funds received and promptly transmitted for effecting transactions via subscriptions on a subscription way basis where the funds are payable to the issuer or its agent and not to the Company; did not carry accounts of or for customers; and did not carry PAB accounts (as defined in Rule 15c3-3) throughout the most recent fiscal year, December 31, 2023, without exception. EuroConsult Capital LLC's management is responsible for compliance with the provisions contemplated by Footnote 74 of SEC Release No. 34-70073 adopting amendments to 17 C.F.R. § 240.17a-5 and related SEC Staff Frequently Asked Questions 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 EuroConsult Capital LLC's compliance with the exemption provisions. A review is substantially less in scope than an examination, the objective of which is the expression of an opinion on management's statements. 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 statements referred to above for them to be fairly stated, in all material respects, based upon the Company's business activities contemplated by Footnote 74 of the SEC Release No. 34-70073 adopting amendments to 17 C.F.R. §240.17a-5, and related SEC Staff Frequently Asked Questions. **McBee & Co., PC** Dallas, Texas February 15, 2024 {16}------------------------------------------------ ## **EuroConsult Capital, LLC's Exemption Report** EuroConsult Capital, LLC 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-S(d)(l) 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: (1) mergers and acquisitions; and (2) private placement of securities, and the Company (1) did not directly or indirectly receive, hold, or otherwise owe funds or securities for or to customers, (other than money or other consideration received and promptly transmitted in compliance with paragraph (a) or (b)(2) of Rule 15c2-4 and/or funds received and promptly transmitted for effecting transactions via subscriptions on a subscription way basis where the funds are payable to the issuer or its agent and not to the Company); (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. EuroConsult Capital, LLC I, Evan S. Yellin, affirm that, to my best knowledge and belief, this Exemption Report is true and correct. Signature Principal February 13, 2024 Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.