# K CAPITAL LLC X-17A-5 (2020-02-25) — Broker-dealer annual report - Company: K CAPITAL LLC - Form: X-17A-5 - Filed: 2020-02-25 - Period: 2019-12-31 - Accession: 0001433656-20-000001 - CIK: 1433656 - File #: 8-67884 - Material weakness: No - Auditor: Spicer Jeffries LLP - Auditor location: Denver, CO - Contact: Michael Brown - Phone: 404-303-8840 - Signed by: Michael Brown (Chief Executive Officer) Original filing: https://www.sec.gov/Archives/edgar/data/1433656/000143365620000001/KC2019AuditPublic3.pdf --- {0}------------------------------------------------ #### UNITEDSTATES SECURITIES ANDEXCHANGE COMMISSION Washington, D.C. 20549 OMB APPROVAL OMB Number: 3235-0123 Expires: August 31, 2020 Estimated average burden hours per response .. . . . . . . 12.00 # ANNUAL AUDITED REPORT FORM X-17A-5 PART III | SEC FILE NUMBER | |-----------------| | 8-67884 | #### 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 01/01/2019 | | AND ENDING 12/31/2019 | | | | | MM/DD/YY | | MM/DD/YY | | | | A. RECISTRANT IDENTIFICATION | | | | | NAME OF BROKER-DEALER: K Capital LLC | | OFFICIAL USE ONLY | | | | ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use P.O. Box No.) | | FIRM I.D. NO. | | | | 805 3rd Avenue, Floor 14 | | | | | | | (No. and Street) | | | | | New York | New York | | 10022 | | | (City) | (State) | | (Zip Code) | | | NAME AND TELEPHONE NUMBER OF PERSON TO CONTACT IN REGARD TO THIS REPORT
Michael Brown
404-303-8840 Ext 1005 | | | (Area Code - Telephone Number) | | | INDEPENDENT PUBLIC ACCOUNTANT whose opinion is contained in this Report* | B. ACCOUNTANT IDENTIFICATION | | | | | Spicer Jeffries LLP | | | | | | | (Name - if individual, state last, first, middle name) | | | | | 4601 DTC Blvd., Suite 700 | Denver | Colorado | 80237 | | | (Address) | (City) | (State) | (Zip Code) | | | CHECK ONE: | | | | | | Certified Public Accountant | | | | | | Public Accountant | | | | | | 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. Public SEC 1410 (06-02) {1}------------------------------------------------ #### OATH OR AFFIRMATION I Michael Brown swear the success swear (or affirm) that, to the best of my knowledge and belief the accompanying financial statement and supporting schedules pertaining to the firm of K Capital LLC 100-00-00 000 000, as of December 31 are the many and correct. I further swear (or affirm) that neither the company nor any partner, principal officer or director has any proprietary interest in any account classified solely as that of a customer, except as follows: | | Signature | | | | |---------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------|--|--|--| | | | | | | | | Chief Executive Officer | | | | | bruary 18, 2022 | Title | | | | | | | | | | | | | | | | | This report ** contains (check all applicable boxes): | | | | | | (a) Facing Page. | | | | | | (b) Statement of Financial Condition. | | | | | | (c) Statement of Income (Loss). | | | | | | (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. | | | | | (i) A Reconciliation, including appropriate explanation of the Computation of Net Capital Under Rule 15c3-1 and the | | | | | | Computation for Determination of the Reserve Requirements Under Exhibit A of Rule 15c3-3. | | | | | | | (k) A Reconciliation between the audited Statements of Financial Condition with respect to methods of | | | | | consolidation. | | | | | | (I) An Oath or Affirmation. | | | | | | (m) A copy of the SIPC Supplemental Report. | | | | | | | (n) A report describing any material inadequacies 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). | | | | {2}------------------------------------------------ # **STATEMENT OF FINANCIAL CONDITION** # **YEAR ENDED DECEMBER 31, 2019** The report is filed in accordance with Rule 17a-5(e)(3) under the Securities Exchange Act of 1934 as a **PUBLIC DOCUMENT.** {3}------------------------------------------------ ### **TABLE OF CONTENTS** | Report of Independent Registered Public Accounting Firm | 3 | |---------------------------------------------------------|-------| | Statement of Financial Condition | 4 | | Notes to Financial Statements | 5 – 7 | {4}------------------------------------------------ ![](_page_4_Picture_0.jpeg) '7&%28/(9\$5'68,7( '(19(5&2/25\$'2 7(/(3+21( )\$; ZZZVSLFHUMHIIULHVFRP # **5(32572),1'(3(1'(175(\*,67(5('38%/,&\$&&2817,1\*),50** 7RWKH%RDUGRI'LUHFWRUVDQG0HPEHUVRI .&DSLWDO//& ## **2SLQLRQRQWKH)LQDQFLDO6WDWHPHQWV** :HKDYHDXGLWHGWKHDFFRPSDQ\LQJVWDWHPHQWRIILQDQFLDOFRQGLWLRQRI.&DSLWDO//&WKH³&RPSDQ\´ DVRI'HFHPEHUDQGWKHUHODWHGQRWHVWRWKHVWDWHPHQWRIILQDQFLDOFRQGLWLRQ,QRXURSLQLRQWKH ILQDQFLDO VWDWHPHQW SUHVHQW IDLUO\LQDOOPDWHULDO UHVSHFWVWKH ILQDQFLDO SRVLWLRQ RIWKH&RPSDQ\DV RI 'HFHPEHULQFRQIRUPLW\ZLWKDFFRXQWLQJSULQFLSOHVJHQHUDOO\DFFHSWHGLQWKH8QLWHG6WDWHVRI \$PHULFD ## **%DVLVIRU2SLQLRQ** 7KLV ILQDQFLDO VWDWHPHQW LV WKH UHVSRQVLELOLW\ RI WKH &RPSDQ\¶V PDQDJHPHQW 2XU UHVSRQVLELOLW\ LV WR H[SUHVVDQRSLQLRQRQWKH&RPSDQ\¶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page_4_Picture_12.jpeg) {5}------------------------------------------------ #### **STATEMENT OF FINANCIAL CONDITION** | DECEMBER 31, 2019 | | |-------------------|--| |-------------------|--| #### **ASSETS** | Total assets | \$
807,442 | |--------------------------|---------------| | Other assets | 82 | | Accounts receivable | 8,000 | | Due from Parent (Note 3) | 744,744 | | Cash | \$
54,616 | #### **LIABILITIES AND MEMBER'S EQUITY** | LIABILITIES: | | |-----------------------------------------------|---------------| | Deferred revenue | \$
- | | Total liabilities | - | | COMMITMENTS AND CONTINGENCIES (Notes 3 and 4) | | | MEMBER'S EQUITY (Note 2) | 807,442 | | Total liabilities and member's equity | \$
807,442 | The accompanying notes are an integral part of this statement. {6}------------------------------------------------ # **NOTES TO FINANCIAL STATEMENTS** ### **NOTE 1- ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** #### **Organization and Business** K Capital LLC (the "Company") was formed in the state of Delaware on March 14, 2011, and is a wholly owned subsidiary of Kinetic Advisors LLC. The Company's objective is to assist business clients in the areas of private placements, mergers and acquisitions, oil and gas interests and limited partnerships. The Company is registered with the Securities and Exchange Commission ("SEC") and is a member of the Financial Industry Regulatory Authority, Inc. ("FINRA"). ### **15c3-3 Exemption** The Company carries no customer funds or securities and therefore is exempt from the reserve and possession or control requirements under Rule 15c3-3(k)(2)(i) of the Securities Exchange Act of 1934. #### **Revenue Recognition** The Company's primary sources of revenue are advisory fees and sales concessions. The Company records these fees when they are earned. As of December 31, 2019, management has determined that no allowance for doubtful accounts is necessary. ### **Estimates** The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America 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 reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. #### **Income Taxes** The Company is recognized as a disregarded entity by the Internal Revenue Service. The Member of the Company is liable for federal and state income taxes on the Company's taxable income. The Company, through its Member, is subject to New York City Unincorporated Business Tax. {7}------------------------------------------------ #### **NOTES TO FINANCIAL STATEMENTS (continued)** #### **NOTE 1- ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (concluded)** #### **Income Taxes (concluded)** 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, through its Member, 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 2016. 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 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, 2019. #### **NOTE 2 – NET CAPITAL REQUIREMENTS** Pursuant to the net capital provisions of Rule 15c3-1 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, 2019, the Company had net capital and net capital requirements of \$54,616 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 3 – RELATED PARTY TRANSACTIONS AND COMMITMENTS** The Company has entered into an expense sharing agreement with its Parent. Under the terms of this agreement, the Company pays various shared expenses including rent, utilities, salaries, marketing and advertising, professional and other miscellaneous expenses. Total of such expenses under this agreement were \$18,010 per month for the year ended December 31, 2019. The Company expensed \$281,325 in accordance with its expense sharing agreement. As of December 31, 2019, the Company had a due from Parent balance of \$744,744. {8}------------------------------------------------ # **NOTES TO FINANCIAL STATEMENTS (concluded)** # **NOTE 4 – FINANCIAL INSTRUMENTS, OFF-BALANCE SHEET RISK AND CONTINGENCIES** The Company is engaged in business with various counterparties. In the event that counterparties do not fulfill their obligations, the Company may be exposed to risk. The risk of default depends on the creditworthiness of the counterparty. It is the Company's policy to review as necessary, the credit standing of each counterparty with which it conducts business. The Company maintains its cash balance in a financial institution, which at times may exceed federally insured limits. As of December 31, 2019, the Company did not hold cash in excess of the federally insured limit. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk. The Company's financial instruments, including cash, other assets, accounts receivable and due to Parent are carried at amounts that approximate fair value due to the short-term nature of those instruments. # **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. Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.