# DEMETER ADVISORY GROUP, LLC X-17A-5 (2024-02-12) — Broker-dealer annual report - Company: DEMETER ADVISORY GROUP, LLC - Form: X-17A-5 - Filed: 2024-02-12 - Period: 2023-12-31 - Accession: 0001437665-24-000001 - CIK: 1437665 - File #: 8-67919 - Type: Broker-dealer - Material weakness: No - Auditor: Ernst Wintter & Associates LLP - Auditor location: Walnut Creek, CA - Contact: Elizabeth Collins - Phone: 4152469169 - Signed by: Jeff Menashe (CEO) Original filing: https://www.sec.gov/Archives/edgar/data/1437665/000143766524000001/dag2023.pdf --- {0}------------------------------------------------ Annual Audit Report December 31, 2023 *ERNST WTNTTER* & *ASSOCIATES LLP* Certified Public Accountants {1}------------------------------------------------ **UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549** | 0MB APPROVAL | | |--------------------------|--| | 0MB Number: 3235-0123 | | | Expires: Nov. 30, 2026 | | | Estimated average burden | | | hours per response: 12 | | | SEC FILE NUMBER | | | 8-67919 | | # **ANNUAL REPORTS FORM X-17A-5 PART Ill** **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 /23** MM/DD/VY AND ENDING 12/31 /23 MM/DD/VY **A. REGISTRANT IDENTIFICATION** NAME oF FIRM: Demeter Advisory Group, LLC TYPE OF REGISTRANT (check all applicable boxes): C!:I Broker-dealer • Security-based swap dealer • Check here if respondent is also an OTC derivatives dealer • Major security-based swap participant ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use a P.O. box no.) 1508 Bay Road #511 (No. and Street) Miami Beach **FL** 33139 {City) {State) {Zip Code) PERSON TO CONTACT WITH REGARD TO THIS FILING Jeff Menashe 415-828-5482 menashe @demeteradvisorygroup.com {Name) (Area Code - Telephone Number) {Email Address) **B. ACCOUNTANT IDENTIFICATION** INDEPENDENT PUBLIC ACCOUNTANT whose reports are contained in this filing\* Ernst Wintter & Associates LLP (Name - if individual, state last, first, and middle name) 675 Ygnacio Valley Road, Suite A200 Walnut Creek CA 94596 (Address) (City) {State) (Zip Code) 02/24/2009 3438 l" of **R,g;st,atio, with PCAOBJI• appl;cable) FOR OFFICIAL USE ONLY** \* 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-S(e)(l)(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 0MB control number.** {2}------------------------------------------------ fn~r..:;;~i ,..~~101 -: oe1-i:cir•ri;; ~~t: :t....1e *.:* <:-:·, of- ··,2/31 . *Z?.'2}·* -:'.l'~r>7crl ~ff!cer. ::-iin:-:rc:· .. ~1' *~t !·,* a t.t:.:--'~ pc;.,jv :- ~(:'.i.3 tr,.r ~::; rn2•v' ::<:, rJ\_; 2n·;, c~ot .. 'f; =:·-:·--: 'i"\t( ·1::3~: r. ~~) 3i:·.:r:;u·: ~*t.* ,3£s·r:;d \_!..::,:; ··. as t;·?ct :~ a ~uslcn :e·. ,,,.-~ , I , *I* - ~ (::: .St~/'~~rr.!.:'-.! c.; 7 ""?~:-:ciu (.~1" ~if ::: ... . - (b) :\c:·-·,tt.. t~ ..'..."Jr, .. ,1;:·•~-:=: : e,.;. ':tl1i.ittrrc" t ~. f :--:.~~·ti~ .\_·c--:1t.cr \_\_ - ~(,:J" s.:.t;r~Ci1,e;.-i ,:;: ,••er. '"'.'1~ :1c.~s~ ...\_., ... ft:·le1··:: .:: ;ir~c ... . : ... , .. \_..:.·i:-•; · .. ~.5L:f.' i f f:)t\f ; · ~-r·-~~ 1!:1r"'J~ --.;J .: · c!--: 1.c:.: ~ ~:i!:~ .... : 4::-:: Jf ,;cmt:rc·:ens:v': -~ ~0r1e (;,~ define:; ir. § ;:1;~ .. 1. :,2 cf :le\_.;1;1atic~. **S**:(. - Iii 'c: Si\_a:;;:-r•~--~ P. ; l:·, \$D ··d-1 : b, *·:-'* ,:-• ::::2 :.,., ~· ~·· . ;ii~ *:.i::.;;;: : .. •:;,'"* 0;-~::.1: : , . . - *,\_ii* S!at crr~en: ~f ch::-:""gr:s iii l:i:bili-:1:i-~ \_;;utr:""Cl;,"-tt.~ -re~ .1:rr,.5 ~ · (.i·;;c:t~= ..~ - 1,.s,\_; \:c.:tt"~t.: cc.-· ")r~1:~cle.;'. finan: ·:i !ol :.!t~"""!-:n::.. - (;1~ Co.=-:ir-•u:~~i':'r; ff ' .~·;:~µi·t ,.\_,~-~:-i:·:-; ~== r< "'.' ,\_jQ\_~ J.:) -lo .... :-- c:=;~ ;..lG.:3;.,.•-~- *:: ~*·)p:~1!::-~b;~. - ::? ~-· ::ornputat".;,.~- ~t 1 ;ani t!::: •:-:e-~ .• -..-~;:h i.:;.ciei ~ *1*: .T~ 24C.lt..t.J :E.. - ~, Cr;rnpt..r:.;:.t~::ir. *ic.·* d,:t~r~~ ~=1" i',:n *r.:* t·.us.··or~."'!'I" r:::""'"'"'°· f .... .-, .... ·rr•""'·::- ,\_,; :>!: . ) ~1: , L... =!(nn,;·\_ · tr:- ~ ~ r\_;~ :!:) :, ~t'3-3 - - - (;n) i:;,t°;o"·\_:,1;:,ti,>.~ "e 'c•i,, ~-:.\_ t ~ P,CS'Si' .~ ~:c·' ·.,, ,:i\_'""i~'C· 1 ~q:..·.-'1'£:-r•·t"~ *·t* r;:' ::t;!).:,.trt<:"r~ . ..,.,:' ,.~~- \_:\_ 7 c~:.. .. ?r..".~.\_::t ? -S - ·::1:1 !:--for:n;;t:c:"'i :--eb ~1:1g "ln :,c,:;ses:;!.::-i ~ cJ:i".ri:· re:;,.;:'""c:-:r.:,.:s -fer 1~: ... :·::--1. b;.:;c::'! ; •·~·~;: : iJi.,~~:'\'"'·~-=> . · ~-:.r ·: 7 ".:f? 11,c.J.:;c;-~·tpH?:: Of J.7 :'FR 2~G.:5"·'4 • a~- opci·t~t-- 1 ~ - ~~-:,:, f·tt?.:,Jr:..:.:i~~::.,n:;\_. :r,~i .. :ci1n5; : p~r•:-~ · 1~! !; .:···~J;;i.:n~ t·::t'i~, :if t:--. .: r vC \_·,: ~\: t.: ..: -: *:\·* th c~Jn-,·.,:.;:;.:.t ..: ~: : ~ i" .:-:t c:.: : !::i:1 : :,. · tcr.~f::!c nJ: 'Nor:.h ,J-.:;e- :l (:f-l'f. 2...:::.1~~3-l. :.. -:\_-!""~ 2::·:.:.S'ti-l :i~ l *·::·~t* L!.J.J. ~.:1 -~ 3~ Cj: pq,\_~ (i:t: an-:. t:-1,.: ri::!.E:."•::! "'F.:t\_: '.J:r~;E~; : .s u~C.er l., cr=::c. 2,1·.:·.1.Sc3 *::.* ~:· 1 7 ::::n ;\_..-~ .,. :Z;; ,:, ..::s ~.:~t:c,:, : . if iT ..:i:~:i;.. ~1-:°c"':- :1 :..~.:: :- x·.)'=. ~r ;: *s-:~:::cr-*.. -:-:-· ~ .. :r- ro r,~(l:.:: ·:r: °]lfr..:~r.::.s - {:J.• Si"' ·r.rr ~.air': 0 1~ ~ a::titf :;'~:f.:i ·t)" ~ ... ~:: i;.iic; .. ,~:.. ,...iol :::;\_;r,~oii~at,~:i · ··, 'i..11r.: ; ~:1t,=-rr1~r·,l ~tf f 1r .~r.t iG. ~:,r ~ j•\_ ·-~;-. - f *::i J*02rh c; ctff .. m ;nic:--, ·- ;)C::or~c1r.c~: vJ~:- 1-; :~R 240.17:: 5, !.:· c-:-1 240.17;. 12., er 1- :tR ~1r;.:i 8~ . ;;< e.ppl!r.;: ') ~- - - **1!i** (:.: F.,.1:<-r,pt:c:-- epc~I. · .. acco·,an•:; ·,\_;·\_1-, :1: ::r=R 2:1:i.~.7~-3 c·; ~ CF·=> 24~.'8,-:, i'.; -~op :c.;•rn·. - ~~·, ln~1..-·:~-;cne1~r~r :\_tlic :lt::::-::.~:rr:;~n·:'s -:'!~1rt t"r::..;.:c- ~r; t'l \~:-.;i-·,f· .. ·y-·!::-,- J7.,. ~..:: 5i::.t.:IT'cn: :.f 7!.-:a:'"!~1:: . er~~ !ic ... - ~ !:~; 1·:t!eo=-~c.'!t p1 .. u .. :::; ~:.,.::.r,;1.;r.&:..: ·;~·., · :::;•.;,; ~ *',i;;t= d*, ... ,~ n fq:,;1 rr1:,,, : i1.:rt *~,* '"i!t· t;r,:! :•t·?i : ~,;,:,,; ·;\_ :;: :i,1 ·:: .:.. ..:-1 .. ~ *:: ,:-•.·i: 1 1c;:* t, 1dl~ r ~.i CFR .2,::.17i1-~, :i.! .:rr. 2.4:J.'..:.Sr!-lj -~ ~1-r c=~ ~-1:i.1~~-::.;:, i:5 ii~~!!: c:D!c. - r. iv, lr:::::;:--enden;,: ·J\_bii: ~i:~:,,\_:n;an~' s rcpor.: ;.~3~= :ll~ ~-r. '?X~f""1i"at.G!' ·.Jf :2:i:air, S"t.3!e:---;er.~s ii?--~~ C:'~f;;;a,:::: :'"€'0::'lrt U'·1e- ~- ,. CFR. 2~-G.l.Ju-:; or *~.i* :::-=~ /.4C lcci-7, f·:; ;,:,-:-·::·:,!tJle. - ,-•Nj :.-- dr.:.~r'idtn~ ;.,ul::::c. c:-cc~:..n-:~,..,7s ;cpcrt o:;5ej ::r• *t* r!:·ne·:.: oi ....... e ~'< -:;""';:.:1•.;n re :,l::,i 1'"L :Jnr.:.<:::r 1 · ~-rR :.?4:.J.~ .. *::: -:* ,\_. .. : *i* c·:;\_ :- 40. --!.~1:J 7 ;;:; ;.ppHc:;::.· *:~.* - B:i .ar-"'- :l:!:·.~iOl8. - , .• ,.., F\ .... 1;.:)rt chtSC(':1 "l~ ..~nJ ,'T•.=t"''';•ii; 4 iri.-.""t .. ~q,>,-=.i{\_= .... s ft .. ,.-i) ·.;.; r.:xist nr .;..-:unr. tr- r,t1'.1 r .. ~li~ ·co :-;:nc"'· r:1f. :.ii::::-- :,f t;·e r:""'e\.·i:u~ ;.u:f'C. *-:-..* ;. -;t~~t:"e;--';"+.:;r'!" ··no?;. n{" .~·1;.!8 ·:c~! ir•a~:-~Gl-.ici:-:f*j"* ..• , - . -.~ I *:* --· • **,,.,,.-·,:-r;.1** ' --- r·,:.,, - *4-* --..\_\_ *-* \_- **\_** ~ **\_\_ ',.V!J** ·, *,))'* 1. t,..\_ •• *• ··Tt,* 1~·t~1 ... J/~ t.;r;,~\_f;'a·~·.,.t,'{J; ·.\ *~i~t."'.•·.cnt ;;f* c':.r:c .. r-: ,i:,~.r-..i·ci•~J cf~.~:~ *f,::;r~ .* s,:e :7 Ctr" L.40 *27:,-5~-~#* r3) *:,r* ;\_7 *C, ....* ~ *i4i) ...* '..f:. .• ci, ,2/# O'.· *:;p:\_;;.':t,~!.;i(•.* {3}------------------------------------------------ ### **December 31, 2023** # **Table of Contents** | Report of Independent Registered Public Accounting Firm | | |-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----| | Statement of Financial Condition | 2 | | Statement of Income | 3 | | Statement of Changes in Member's Equity | 4 | | Statement of Cash Flows | 5 | | Notes to the Financial Statements | 6 | | Supplemental Information | | | Schedule I: | 11 | | Computation of Net Capital Under Rule 15c3-I
of the Securities and Exchange Commission | | | Reconciliation with Company's Net Capital Computation | | | Schedule II: | 12 | | Computation for Determination of Reserve Requirements and
Information Relating to Possession or Control Requirements
Under Rule I 5c3-3 of the Securities and Exchange Commission | | | Review Report of Independent Registered Public Accounting Firm | 13 | | SEA I 5c3-3 Exemption Report | 14 | {4}------------------------------------------------ ### **Report of Independent Registered Public Accounting Firm** To the Member of Demeter Advisory Group, LLC #### **Opinion on the Financial Statements** We have audited the accompanying statement of financial condition of Demeter Advisory Group, LLC (the '·Company" ) as of December 31 , 2023, the related statements of income, changes in member's equity, and cash flows for the year then ended, and the related notes and schedules I and II (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 , 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 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 pe1form 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 an10unts 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** Schedules I and II have 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 detem1ining whether the supplemental infonnation 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. l 7a-5. In our opinion, schedules I and II are fairly stated, in all material respects, in relation to the financial statements as a whole. *l'I* **I.a ,il•\_- 1'** • •••· I• • • ( ... I **,l / J** *l l* I., We have served as Demeter Advisory Group, LLC's auditor since 2008. Walnut Creek, California February 2, 2024 {5}------------------------------------------------ # **Statement of Financial Condition** **December 31, 2023** | Assets | | |---------------------------------------|---------------| | Cash | \$
198,161 | | Prepaid expenses | 4,341 | | Total Assets | \$
202,502 | | Liabilities and Member's Equity | | | Accrued expenses | \$
10,885 | | Deferred revenue | 47,500 | | Total Liabilities | 58,385 | | Member's Equity | 144,1 17 | | Total Liabilities and Member's Equity | \$
202,502 | {6}------------------------------------------------ # **Statement of Income** ### **For the Year Ended December 31, 2023** | Revenue | | |----------------------------------|----------------| | Investment banking fees | \$
187,000 | | Client reimbursed expense income | 2,917 | | Total Revenue | 189,917 | | Expenses | | | Professional fees | 24,900 | | Regulatory fees | 6,476 | | Client reimbursable expenses | 2,917 | | Other operating expenses | 3,651 | | Total Expenses | 37,944 | | Net Income | 151 ,973
\$ | | | | {7}------------------------------------------------ ### **Statement of Changes in Member's Equity** ### **For the Year Ended December 31, 2023** | Member's Equity, January 1, 2023 | 129, 144
\$ | | | |------------------------------------|----------------|--|--| | Distributions | {137,000) | | | | Net income | 15 1,973 | | | | Member's Equity, December 31, 2023 | 144,117
\$ | | | {8}------------------------------------------------ ### **Statement of Cash Flows** ### **For the Year Ended December 31, 2023** | Cash Flows from Operating Activities | | | |--------------------------------------------------------------------------------------|----|-----------| | Net income | \$ | 151,973 | | Adjustments to reconcile net income
to net cash provided by operating activities: | | | | (Increase) decrease in: | | | | Prepaid expenses | | (306) | | Increase (decrease) in: | | | | Accrued expenses | | (10,277) | | Deferred revenue | | (2,500) | | Net Cash Provided by Operating Activities | | 138,890 | | Cash Flows from Financing Activities | | | | Distributions | | (137,000) | | Net Cash Used in Financing Activities | | (137,000) | | Net Increase in Cash | | 1,890 | | Cash at beginning of year | | 196,271 | | Cash at End of Year | \$ | 198, 161 | {9}------------------------------------------------ # **Notes** to **the Financial Statements** ### **December 31, 2023** #### **1. Organization** Demeter Advisory Group, LLC (the "Company") was organized as a California limited liability company in March 2008, and converted to a Florida limited liability company in December 2022. The Company is owned by its sole member, Demeter Group Holdings, LP ("DGH"), and currently operates in Miami Beach, FL. Under this form of organization, the member is not liable for the debts of the Company. The Company is a securities broker dealer registered with the Securities and Exchange Commission and engages in mergers and acquisitions and private placement advisory services on a fee basis. #### **2. Significant Accounting Policies** #### **Cash and Cash Equivalents** The Company considers all demand deposits held in banks and certain highly liquid investments with original maturities of three months or less, other than those held for sale in the ordinary course of business, to be cash equivalents. As of December 3 1, 2023, there were no cash equivalents. #### **Accounts Receivable** Accounts receivable represents amounts that have been earned and billed to clients in accordance with the terms of the Company's engagement letters with respective clients that have not yet been collected. The Company accounts for estimated credit losses on financial assets measured at an amortized cost basis in accordance with FASB ASC 326-20, Financial Instruments - Credit Losses. FASB ASC 326-20 requires the Company to estimate expected credit losses over the life of its financial assets as of the reporting date based on relevant information about past events, current conditions, and reasonable and supportable forecasts. The Company records the estimate of expected credit losses as an allowance for credit losses. For financial assets measured at an amot1ized cost basis the allowance for credit losses is reported as a valuation account on the Statement of Financial Condition that is deducted from the asset's amortized cost basis. Changes in the allowance for credit losses are reported as credit loss expense on the Statement of Income. As of December 31, 2023, there were no receivables and no allowance was deemed necessary. ### **Use of Estimates** The preparation of financial statements in accordance 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 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 and may have an impact on future periods. ### **Fair Value of Financial Instruments** Unless otherwise indicated, the fair values of all reported assets and liabilities that represent financial instruments (none of which are held for trading purposes) approximate the carrying values of such amounts. At December 31 , 2023, the Company has no assets or liabilities that are required to be adjusted to fair value on a recurring basis. #### **Income Taxes** The Company is a single member limited liability company and is treated as a disregarded entity for tax purposes. In lieu of income taxes, the Company passes I 00% of its taxable income and expenses to its sole member. Therefore, no provision or liability for federal or state income taxes is included in these financial statements. The Company is no longer subject to examination by taxing authorities for tax years before 2019. {10}------------------------------------------------ ### **Notes to the Financial Statements** ### **December 31, 2023** #### **3. Revenue from Contracts with Customers** Revenue from contracts with customers is recognized when, or as, the Company satisfies performance obligations by transferring the promised goods or services to the customers. A good or service is transferred to a customer when, or as, the customer obtains control of that good or service. A performance obligation may be satisfied over time or at a point in time. Revenue from a performance obligation satisfied over time is recognized by measuring progress in satisfying the performance obligation in a mann~r that depicts the transfer of the goods or services to the customer. Revenue from a performance obligation satisfied at a point in time is recognized at the point in time when it is determined the customer obtains control over the promised good or service. The amount of revenue recognized reflects the consideration the Company expects to be entitled to in exchange for those promised goods or services (i.e., the "transaction price"). In determining the transaction price, the Company considers multiple factors, including the effects of variable consideration. Variable consideration is included in the transaction price only to the extent it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainties with respect to the amount are resolved. In determining when to include variable consideration in the transaction price, the Company considers the range of possible outcomes, the predictive value of past experiences, the time period of when uncertainties expect to be resolved and the amount of consideration that is susceptible to factors outside of the Company's influence, such as market volatility or the judgment and actions of third parties. Noncash consideration is reflected in the transaction price at its fair value measured at contract inception unless determined to be variable consideration. When the fair value cannot be easily determined, the transaction price is the estimated selling price of the promised goods or services. The following provides detailed information on the recognition ofrevenue from contracts with customers: #### **Investment Banking Fees** Success fees from merger and acquisition engagements are typically calculated as a fixed percentage of the aggregate variable consideration in a transaction. Success fees are generally recognized at the point in time when the performance in the engagement is completed (the closing date of the transaction). Advisory fees are fixed fees, commencing upon closing of certain financing transactions and provided on an ongoing basis over a given time period or until a specified event occurs, and recognized on a monthly basis as the services are provided. Retainer fees from merger and acquisition engagements are fixed fees received in advance and recognized at the point in time as specified in the engagement letter or when the performance in the engagement is completed (the closing date of the transaction). Termination fees are recognized at a point in time. ### **Disaggregation of Revenue** The following table presents the Company's revenue from contracts with customers by business activity for the year ended December 31 , 2023: | Revenue from contracts with customers: | | |------------------------------------------|-----------| | Investment banking fees-termination fees | \$100,000 | | Investment banking fees- advisory fees | 50,000 | | Investment banking fees-retainer fees | 37,000 | | Reimbursed expense income | 2,917 | | Total | \$189,917 | {11}------------------------------------------------ ### **Notes to the Financial Statements** ### **December 31, 2023** #### **3. Revenue from Contracts with Customers (continued)** #### **Contract Balances** Income is recognized upon completion of the related performance obligation and when an unconditional right to payment exists. The timing of revenue recognition may differ from the timing of customer payments. A receivable is recognized when a performance obligation is met prior to receiving payment by the customer. As of January I, 2023 and December 31 , 2023, there were no amounts receivable. Alternatively, fees received prior to the completion of the performance obligation are recorded as deferred revenue on the Statement of Financial Condition until such time when the performance obligation is met. Deferred revenue would primarily relate to advisory fees and retainer fees received in investment banking engagements. Deferred revenue related to contracts with customers totaled \$50,000 at January I, 2023 and \$47,500 at December 31, 2023. #### **Contract Costs** Direct costs associated with investment banking advisory engagements are deferred only to the extent they are explicitly reimbursable by the client and the related revenue is recognized upon completion of services. All other investment banking advisory related expenses are expensed as incurred. All investment banking advisory expenses are recognized within their respective expense category on the Statement of Income and any expenses reimbursed by clients are recognized as reimbursed expense income on the Statement of Income. For the year ended December 31, 2023, there were \$2,917 in reimbursable expenses and \$2,917 in reimbursed expense income. At January I, 2023 and December 31 , 2023 there were no capitalized contract costs. #### **4. Related Party Transactions** The Company has an expense sharing agreement with DGH. DGH provides office space and pays most overhead expenses for the Company. The Company has no obligation to reimburse or compensate DGH. The Company's results of operations and financial position could differ significantly from those that would have been obtained if the entities were autonomous. #### **5. Risk Concentration and Contingencies** For the year ended December 31, 2023, 79% of investment banking fees were earned from one client. At various times during the year, the Company's cash balances may exceed the FDIC insured limit. The Company has not experienced any losses. #### **6. Net Capital Requirements** The Company is subject to the Securities and Exchange Commission's uniform net capital rule (Rule I Sc3-I) which requires the Company to maintain a minimum net capital equal to or greater than \$5,000 and a ratio of aggregate indebtedness to net capital not exceeding IS to I, both as defined. At December 31, 2023, the Company's net capital was \$139,776, which exceeded the requirement by \$134,776. {12}------------------------------------------------ ### **Notes to the Financial Statements** **December 31, 2023** ### 7. **Subsequent Events** The Company has evaluated subsequent events through February 2, 2024, the date which the financial statements were issued. {13}------------------------------------------------ #### *SUPPLEMENTAL INFORMATION* {14}------------------------------------------------ # **Demeter Advisory Group, LLC Schedule** I # **Computation of Net Capital Under Rule 15c3-1 of the Securities and Exchange Commission** ### **As of December 31, 2023** | Net Capital | | |----------------------------------------------------------|---------------| | Member's equity | \$
144,117 | | Less: Non-allowable assets | | | Prepaid expenses | 4,341 | | Net Capital | \$
139,776 | | Net minimum capital requirement of 6 2/3% of aggregate | | | indebtedness of\$58,385 or \$5,000, whichever is greater | 5,000 | | Excess Net Capital | \$
134,776 | # **Reconciliation with Company's Net Capital Computation (Included in Part** II **of Form X-17A-5 as of December 31, 2023)** There were no material differences noted in the Company's net capital computation included in this report and in the Company's Part IIA FOCUS filing at December 31, 2023. {15}------------------------------------------------ # **Demeter Advisory Group, LLC Schedule II** **Computation for Determination of Reserve Requirements and Information Relating to Possession or Control Requirements Under Rule 15c3-3 of the Securities and Exchange Commission** ### **For the Year Ended December 31, 2023** The Company engages in merger and acquisition advisory services, and private placement of securities. The Company does not accept customer funds or securities and will not have possession of any customer funds or securities in connection with these activities. Therefore, in reliance on Footnote 74 to SEC Release 34-70073 and as discussed in Q & A 8 of the related FAQ issued by SEC staff, the firm will not claim an exemption from SEA Rule I Sc3-3 but is not subject to the requirements as it does not effect transactions for anyone defined as a customer under Rule I Sc3-3, and there are no items to report under the requirements of this Rule. {16}------------------------------------------------ ### **Review Report of Independent Registered Public Accounting Firm** To the Member of Demeter Advisory Group, LLC We have reviewed management's statements, included in the accompanying SEA Rule I 5c3-3 Exemption Report pursuant to SEC Rule I 7a-5, in which ( I) Demeter Advisory Group, LLC (the "Company") identified that the Company did not claim an exemption under paragraph (k) of 17 C.F.R. §240. l 5c3-3, 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. I 7a-5 because the Company limits its business activities exclusively to: mergers and acquisitions advisory services and private placements of securities. In addition, the Company did not directly or indirectly receive, hold, or otherwise owe funds or securities for or to customers; 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 without exception. The Company'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. I 7a-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 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 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. Walnut Creek, California February 2, 2024 {17}------------------------------------------------ ![](_page_17_Picture_0.jpeg) # **SEA 15c3-3 Exemption Report** Demeter Advisory Group, LLC (the "Company") is a registered broker-dealer subject to Rule l 7a-5 promulgated by the Securities and Exchange Commission (17 C.F.R. §240. l 7a-5, "Reports to be made by certain brokers and dealers" ). This Exemption Report was prepared· as required by 17 C.F.R. §240. l 7a-5(d)(l) and (4). To the best of its knowledge and belief, the Company states the following: - I. 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) merger and acquisition advisory services; (2) private placements of securities, 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 l 5c3-3) throughout the most recent fiscal year without exception. I affirm that, to my best knowledge and belief, this Exemption Report is true and correct. By: **Jeff Menashe** Title: Chief Executive Officer Date: **01/25/2024** Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.