# JDB CAPITAL SECURITIES LLC X-17A-5 (2019-02-19) — Broker-dealer annual report
- Company: JDB CAPITAL SECURITIES LLC
- Form: X-17A-5
- Filed: 2019-02-19
- Period: 2018-12-31
- Accession: 0001399754-19-000001
- CIK: 1399754
- File #: 8-67641
- Material weakness: No
- Auditor: Spicer Jeffries
- Auditor location: Denver, CO
- Contact: Elizabeth Collins
- Phone: 415-526-2759
- Signed by: Lena Dalbey (CCO)
Original filing: https://www.sec.gov/Archives/edgar/data/1399754/000139975419000001/jdbaudit2018.pdf
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UNITED STATES SECURITIESANDEXCHANGECOMMISSION Washington, D.C. 20549
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8-
SEC FILE NUMBER
## **ANNUAL AUDITED REPORT FORM X-17A-5 PART Ill**
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 1/1/2018
AND ENDING 12/31/2018 | | | |
|------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------|---------|------------------------------------|--|
| | MMIDDNY | | MMIDDNY | |
| | A. REGISTRANT IDENTIFICATION | | | |
| NAME oF BROKER-DEALER: JDB Capital Securities LLC
ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use P.O. Box No.) | | | OFFICIAL USE ONLY
FIRM J.D. NO. | |
| | | | | |
| 9304 E. Verde Grove View, Suite 200 | | | | |
| | (No. and Street) | | | |
| | AZ | | 85255 | |
| (City) | (State) | | (Zip Code) | |
| NAME AND TELEPHONE NUMBER OF PERSON TO CONTACT IN REGARD TO THIS REPORT
Lena Dalbey (480-502-5124) | | | | |
| | | | (Area Code - Telephone Number) | |
| | B. ACCOUNTANT IDENTIFICATION | | | |
| INDEPENDENT PUBLIC ACCOUNTANT whose opinion is contained in this Report• | | | | |
| Spicer Jeffries | | | | |
| | (Name - if individual, state last, first, middle name) | | | |
| 4601 DTC Blvd, Suite 700 | Denver | co | 80237 | |
| (Address) | (City) | (State) | (Zip Code) | |
| CHECK ONE: | | | | |
| Ill' I
certified Public Accountant | | | | |
| Public Accountant | | | | |
| B
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 the opinion of an independent public accountant 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.
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## OATH OR AFFIRMATION
| _______________________
1, _L_e_na_D_a_lb_e:y | , swear (or affirm) that, to the best of |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| JOB Capital Securities LLC | my knowledge and belief the accompanying financial statement and supporting schedules pertaining to the firm of
, as |
| of December 31 | are true and correct. I further swear (or affirm) that |
| | neither the company nor any partner, proprietor, principal officer or director has any proprietary interest in any account |
| classified solely as that of a customer, except as follows: | |
| OFFICIAL SEAL
AIMEE E. IHLING
Notary Public • State of Arizona
MARICOPA COUNTY
Comm. ~ires May 10,2019 | ceo
Title |
| This report** contains (check all applicable boxes):
D (a) Facing Page.
D (b) Statement of Financial Condition.
of Comprehensive Income (as defined in §21 0.1-02 of Regulation S-X).
§ (d) Statement of Changes in Financial Condition.
(e) Statement of Changes in Stockholders' Equity or Partners' or Sole Proprietors' Capital.
(f) Statement of Changes in Liabilities Subordinated to Claims of Creditors.
§ (g) Computation of Net Capital.
(h) Computation for Determination of Reserve Requirements Pursuant to Rule 15c3-3.
(i) Information Relating to the Possession or Control Requirements Under Rule 15c3-3.
Computation for Determination of the Reserve Requirements Under Exhibit A of Rule 15c3-3.
consolidation.
B (I) An Oath or Affirmation.
(m) A copy of the STPC Supplemental Report.
D | 0 (c) Statement oflncome (Loss) or, if there is other comprehensive income in the period(s) presented, a Statement
0 U) A Reconciliation, including appropriate explanation of the Computation ofNet Capital Under Rule 15c3-l and the
D (k) A Reconciliation between the audited and unaudited Statements of Financial Condition with respect to methods of
(n) A report describing any material inadequacies found to exist or found to have existed since the date of the previous audit. |
| **For conditions of confidential treatment of certain portions of this filing, see section 240.17a-5(e)(3). | |
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#### REPORT PURSUANT TO RULE 17a-5(d)
#### YEAR ENDED DECEMBER 31, 2018
The report is deemed CONFIDENTIAL in accordance with Rule l7a-5(e)(3) under the Securities Exchange Act of 1934. A statement of financial condition has been filed with the Securities and Exchange Commission simultaneously herewith as a PUBLIC DOCUMENT.
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#### **CONTENTS**
| Report of Independent Registered Public Accounting Firm | 2-3 |
|----------------------------------------------------------------------------------------------|-----|
| Statement of Financial Condition | 4 |
| Statement of Operations | 5 |
| Statement of Changes in Member's Equity | 6 |
| Statement of Cash Flows | 7 |
| Notes to Financial Statements | 8-9 |
| Supplementary Information: | |
| Computation of Net Capital Pursuant to Uniform Net
Capital Rule 1 Sc3-1 | 11 |
| Report of Independent Registered Public Accounting Firm
on the Company's Exemption Report | 12 |
| Managements Assertion Letter Regarding K(2)(i) Exemption (unaudited) | 13 |
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## Si.J SPICER JEFFRIES LLP
CERTIF[ED PUBLIC ACCOUNTANTS 4601 DTC BOULEVARD • SUITE 700 DENVER, COLORADO 80237 TELEPHONE: (303) 753-1959 FAX: (303) 753-0338 www.spicerjeffries.com
## REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Member of JDB Capital Securities LLC
## Opinion on the Financial Statements
We have audited the accompanying statement of financial condition of JOB Capital Securities LLC (the "Company") as of December 31,2018, the related statements of operations, changes in member's equity and cash flows for the year then ended, and the related notes and schedules (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, 2018, 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 the Company's management. Our responsibility is to express an opinion on the Company'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 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 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.
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#### **Supplemental Information**
The Computation of Net Capital has been subjected to audit procedures performed in conjunction with the audit of the Company's financial statements. The supplemental information is the responsibility of the Company'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 Computation of Net Capital is fairly stated, in all material respects, in relation to the financial statements as a whole.
We have served as JDB Capital Securities LLC's auditor~~ u..-(1
Denver, Colorado January 26,2019
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#### STATEMENT OF FINANCIAL CONDITION DECEMBER 31, 2018
#### ASSETS
| CASH | \$
13,171 |
|-----------------------------------------------|--------------|
| OTHER ASSETS | 1,069 |
| | \$
14,240 |
| LIABILITIES AND MEMBER'S EQUITY | |
| LIABILITIES: | |
| Accounts payable | \$
60 |
| COMMITMENTS AND CONTINGENCIES (Notes 2 and 4) | |
| MEMBER'S EQUITY (Note 3) | 14,180 |
| | \$
14,240 |
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#### STATEMENT OF OPERATIONS YEAR ENDED DECEMBER 31, 2018
| REVENUE: | |
|----------------------------|--------------|
| Advisory Income | 100,000 |
| Total Revenue | 100,000 |
| EXPENSES (Note 2): | |
| Professional Fees | 24,988 |
| General and Administrative | 6,911 |
| Occupancy Expenses | 12,000 |
| Total Expenses | 43,899 |
| NET INCOME | \$
56,101 |
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#### STATEMENT OF CHANGES IN MEMBER'S EQUITY YEAR ENDED DECEMBER 31, 2018
| BALANCE, December 31,2017 | \$
26,578 |
|---------------------------|--------------|
| Net Income | 56,101 |
| Distributions | (68,500) |
| BALANCE, December 31,2018 | \$
14,180 |
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#### STATEMENT OF CASH FLOWS YEAR ENDED DECEMBER 31, 2018
| CASH FLOWS FROM OPERATING ACTIVITIES: | |
|--------------------------------------------------------------------------------------|--------------|
| Net Income | \$
56,101 |
| Adjustments to Reconcile Net Income to Net Cash Provided by
operating activities: | |
| Increase in Other Assets | (1,069) |
| Decrease in Accounts Payable | {4,153) |
| Net Cash Provided by Operating Activities | 50,879 |
| CASH FLOWS USED IN FINANCING ACTIVITIES: | |
| Distributions | (68,500) |
| NET INCREASE IN CASH | (17,621) |
| CASH, Beginning of Year | 30,791 |
| CASH, End of Year | \$
13,171 |
7
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#### NOTES TO FINANCIAL STATEMENTS
## *NOTE I- ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES*
#### *Organization and Business*
JDB Capital Securities LLC (the "Company") is a Delaware limited liability company formed in 2006. The Company was approved to operate as a registered broker-dealer with the Securities and Exchange Commission ("SEC") on September 13, 2007 and became a member of the Financial Industry Regulatory Authority, Inc. ("FINRA"). The sole member of the Company is JOB Capital Partners LLC (the "Parent"). The Company provides investment banking services, primarily capital raising, merger & acquisition and financial consulting services.
#### *Rule 15c3-3 Exemption*
The Company, under Rule 15c3-3(k)(2)(i), is exempt from the reserve and possession or control requirements ofRule 15c3- 3 of the Securities and Exchange Commission. The Company does not carry or clear customer accounts.
#### *Revenue Recognition*
Consulting and investment banking revenues include fees arising from strategic advisory and other engagements in which the Company acts as an agent. Consulting and investment banking fees are recorded on the completion date of the private securities offering or merger & acquisition transaction.
#### *Income Taxes*
The Company is a single-member limited liability company and is considered a disregarded entity for federal and state income tax purposes. All items of revenue, expense, gain and loss is included on the Parent's return. Accordingly, the financial statements do not include a provision for income taxes.
The Company is required to determine whether a tax position is more likely than not to be sustained upon examination by the applicable taxing authority, including resolution of any tax related appeals or litigation processes, based on the technical merits of the position. The Company files an income tax return in the U.S. federal jurisdiction, and may file income tax returns in various U.S. states. The Company is not subject to income tax return examinations by major taxing authorities for years before 2015. The tax benefit recognized is measured as the largest amount of benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. De-recognition of a tax benefit previously recognized results in the Company recording a tax liability that reduces net assets. However, the Company's conclusions regarding this policy may be subject to review and adjustment at a later date based on factors including, but not limited to, on-going analyses of and changes to tax laws, regulations and interpretations thereof. The Company recognizes interest accrued related to unrecognized tax benefits and penalties related to unrecognized tax benefits in income taxes payable, if assessed. No interest expense or penalties have been recognized as of and for the year ended December 31, 20 18.
#### *Fair Value o(Financial Instruments*
The carrying amounts reflected in the financial statements for cash and accounts payable approximate their respective fair values due to the short maturities of these instruments.
#### *Cash Equivalents*
For purposes of the statement of cash flows, the Company has defined cash equivalents as highly liquid investments with original maturities of less than ninety days that are not held for sale in the ordinary course of business.
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#### NOTES TO FINANCIAL STATEMENTS
*(concluded)*
## *NOTE 1* - *ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (concluded)*
#### *Use o(Estimates*
In preparing financial statements in conformity with accounting principles generally accepted in the United States of America, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities, the 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.
## *NOTE 2- RELATED PARTIES*
The Company has an expense sharing agreement with its Parent whereby, it will pay \$1 ,000 per month to its Parent for rent and other general overhead expenses. During the year ended December 31, 2018, the Company paid \$12,000 under the arrangement.
## *NOTE 3- NET CAPITAL REQUIREMENTS*
Pursuant to the net capital provisions of Rule 15c3-l of the Securities Exchange Act of 1934, the Company is required to maintain a minimum net capital, as defined under such provisions. At December 31 , 2018, the Company had a net capital and a net capital requirements of\$13, Ill and \$5,000, respectively. The Company's net capital ratio (aggregate indebtedness to net capital) was 0.00 to 1. According to Rule 15c3-1, the Company's net capital ratio shall not exceed 15 to 1.
## *NOTE 4- CONTINGENCIES AND OFF-BALANCE SHEET RISK*
The Company engages in various corporate financing activities with counterparties that primarily include issuers with which the Company has an investment banking assignment. In the event 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 counterparty with which it conducts business.
## *NOTE 5- SUBSEQUENT EVENTS*
The Company has performed an evaluation of subsequent events through the date the financial statements were issued. The evaluation did not result in any subsequent events that required disclosures and/or adjustments.
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#### SUPPLEMENTARYINFO~TION
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#### **COMPUTATION OF NET CAPITAL PURSUANT TO UNIFORM NET CAPITAL RULE 15c3-1 DECEMBER 31, 2018**
| CREDIT: | |
|------------------------------------------------------------------------------------------------------|--------------|
| Member's Equity | \$
14,180 |
| DEBIT: | |
| Nonallowable Assets: | |
| Other Assets | 1,069 |
| NET CAPITAL | 13,111 |
| Minimum requirements of 6-213% of aggregate indebtedness of
\$60 or \$5,000, whichever is greater | 5,000 |
| | |
| Excess Net Capital | \$
8,111 |
| AGGREGATE INDEBTEDNESS: | |
| Accounts Payable | \$
60 |
| RATIO OF AGGREGATE INDEBTEDNESS TO NET CAPITAL | .00 to 1 |
**NOTE:** There are no material differences between the above computation of net capital and the corresponding computation filed by the Company with the unaudited Form X-17 A-5 as of December 31, 2018.
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# SJ SPICER JEFFRIES LLP C. F.RTIPIP.J) PUBLIC ACCOUNTAI\"TS
4601 OTC BOULEVARD • SUITE 700 DENVER. COLORADO 80237 T ELEPHONE: (303) 753-1959 FAX: l303) 753-0338 www.spiccrjdfrics.com
## REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Member of JDB Capital Securities LLC
We have reviewed management's statements, included in the accompanying management statement regarding compliance with Rule l5c3-3 exemption repott, in which (I) JDB Capital Securities LLC (the "Company") identified the following provisions of 17 C.F.R. § 15c3-3(k) under which the Company claimed an exemption from 17 C.F.R. §240.15c3-3(k)(2)(i) (the "exemption provisions") and (2) the Company stated that the Company met the identified exemption provisions throughout the most recent fiscal year without exception. The Company's management is responsible 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 inquiries and other required procedures to obtain evidence about the Company'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 on the provisions set forth in paragraph (k)(2)(i) of Rule 15c3-3 under the Securities Exchange Act of 1934.
Denver, Colorado January 26, 20 19
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## **Exemption Report**
To Whom It May Concern,
To the best knowledge and belief of **JDB Capital Securities, LLC** (the "Company"), the Company claimed exemption from possession or control requirements of SEC Rule 15c3-3 under subparagraph (k)(2)(i) for the fiscal year ended December 31, 2018. This sub paragraph states:
- (k) EXEMPTIONS
- (2) The provisions of this rule shall not be applicable to a broker or dealer:
- (i) Who carries no margin accounts, promptly transmits all customer funds and delivers all securities received in connection with its activities as a broker or dealer, does not otherwise hold funds or securities for, or owe money or securities to, customers and effectuates all financial transactions between the broker or dealer and its customers through one or more bank accounts, each to be designated as "Special Account for the Exclusive Benefit of Customers of JDB Capital Securities, LLC."
The Company met the identified exemption provisions throughout the most recent fiscal year without exception.
Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.