# DUNN RUSH & CO. LLC X-17A-5 (2023-03-01) — Broker-dealer annual report

- Company: DUNN RUSH & CO. LLC
- Form: X-17A-5
- Filed: 2023-03-01
- Period: 2022-12-31
- Accession: 0001466476-23-000002
- CIK: 1466476
- File #: 8-68293
- Type: Broker-dealer
- Material weakness: No
- Auditor: Rolleri Sheppard CPAS, LLP
- Auditor location: Fairfield, CT
- Contact: Greg Rush
- Phone: 617-451-0001
- Email: grush@dunnrush.com
- Website: dunnrush.com
- Signed by: Greg Rush (Member)

Original filing: https://www.sec.gov/Archives/edgar/data/1466476/000146647623000002/DRPublic22.pdf

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### FINANCIAL STATEMENT

December 31, 2022

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| UNITED STATES                      |
|------------------------------------|
| SECURITIES AND EXCHANGE COMMISSION |
| Washington, D.C. 20549             |

| ANNUAL REPORTS |  |
|----------------|--|
| FORM X-17A-5   |  |
| PART Ill       |  |

| SEC FILE NUMBER |
|-----------------|
| 8-68293         |

**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                                                                                                       | ___<br>__<br>2<br>0_l/_0_11_2_                              | AND ENDING | ___<br>__<br>l_2_/3_1_12<br>2<br>_<br>_ |
|---------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------|------------|-----------------------------------------|
|                                                                                                                                       | MM/DD/VY                                                    |            | MM/DD/YY                                |
|                                                                                                                                       | A. REGISTRANT IDENTIFICATION                                |            |                                         |
|                                                                                                                                       |                                                             |            |                                         |
| Dunn Rush & Co. LLC<br>NAME OF FIRM:                                                                                                  |                                                             |            |                                         |
| TYPE OF REGISTRANT (check all applicable boxes}:<br>!Kl Broker-dealer<br>D Check here if respondent is also an OTC derivatives dealer | □ Security-based swap dealer                                |            | D Major security-based swap participant |
| ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use a P.O. box no.)                                                                   |                                                             |            |                                         |
| 75 Federal Street, 21st Floor                                                                                                         |                                                             |            |                                         |
|                                                                                                                                       | (No. and Street}                                            |            |                                         |
| Boston                                                                                                                                | MA.                                                         |            | 02110                                   |
| {City)                                                                                                                                | (State)                                                     |            | (Zip Code}                              |
| PERSON TO CONTACT WITH REGARD TO THIS FILING                                                                                          |                                                             |            |                                         |
| Greg Rush                                                                                                                             | grush@dunnrush.com<br>617-451-0001                          |            |                                         |
| (Name)                                                                                                                                | (Area Code -Telephone Number)                               |            | (Email Address)                         |
|                                                                                                                                       | B. ACCOUNTANT IDENTIFICATION                                |            |                                         |
| INDEPENDENT PUBLIC ACCOUNTANT whose reports are contained in this filing*                                                             |                                                             |            |                                         |
| Rolleri Sheppard, CPAS, LLP                                                                                                           |                                                             |            |                                         |
|                                                                                                                                       | {Name - if individual, state last, first, and· middle name) |            |                                         |
| 2150 Post Road, 5th Floor                                                                                                             | Fairfield                                                   |            | CT<br>06824                             |
| (Address)                                                                                                                             | (City)                                                      |            | (State)<br>(Zip Code)                   |
| 03/04/2009                                                                                                                            |                                                             |            | 3437                                    |
| r"'<br>of Reg;ruatloo wtth PCAOBJ(• appli~bl•)                                                                                        |                                                             |            | (PCAOB "''""""" N"mbec, if appli~bl•J I |
|                                                                                                                                       | 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.** 

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#### **OATH OR AFFIRMATION**

I, Greg Rush , swear (or affirm} that, to t he best of my knowledge and belief, the financial report pertaining to t he firm of Dunn Rush & Co. LLC , as of December 3 1 2 022 , is true and correct. I further swear (or affirm) that neither t he company nor any 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. <sup>~</sup>**Notary ERIC LIPA Public** S. ignature: & *()\_ IL* 

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|                                                                            | ~<br>·           |
|----------------------------------------------------------------------------|------------------|
| ®Commonwealth of Massachusetts<br>My Commiuion Expires<br>Nowmber 25, 2027 | Member<br>Title: |

..... Notary Public £ {, *L, Lfe,.\_* 

#### **This filing\*\* contains (check all applicable boxes):**

- IX) (a) Statement of financial condition.
- txl (b) Notes to consolidated statement of financial condition.
- □ (c) Statement of income (loss) or, if there is other comprehensive income in the period(s) presented, a statement of comprehensive income (as defined in§ 210.1-02 of Regulation S-X).
- □ (d) Statement of cash flows.
- D (e) Statement of changes in stockholders' or partners' or sole proprietor's equity.
- D (f) Statement of changes in liabilities subordinated to claims of creditors.
- D **(g)** Notes to consolidated financial statements.
- D (h) Computation of net capital under 17 CFR 240.15c3-1 or 17 CFR 240.18a-1, as applicable.
- D (i) Computation of tangible net worth under 17 CFR 240.18a-2.
- D (j) Computation for determination of customer reserve requirements pursuant to Exhibit A to 17 CFR 240.15c3-3.
- D (k) Computation for determination of security-based swap reserve requirements pursuant to Exhibit B to 17 CFR 240.15c3-3 or Exhibit A to 17 CFR 240.lBa-4, as applicable.
- D (I) Computation for Determination of PAB Requirements under Exhibit A to§ 240.15c3-3.
- D (m) Information relating to possession or control requirements for customers under 17 CFR 240.15c3-3.
- D (n) Information relating to possession or control requirements for security-based swap customers under 17 CFR 240.15c3-3(p)(2) or 17 CFR 240.lBa-4, as applicable.
- □ (o) Reconciliations, including appropriate explanations, of the FOCUS Report with computation of net capital or tangible net worth under 17 CFR 240.15c3-l, 17 CFR 240.lBa-1, or 17 CFR 240.lBa-2, as applicable, and the reserve requirements under 17 CFR 240.15c3-3 or 17 CFR 240.18a-4, as applicable, if material differences exist, or a statement that no material differences exist.
- D (p) Summary of financial data for subsidiaries not consolidated in the statement of f inancial condition.
- IX! (q) Oath or affirmation in accordance with 17 CFR 240.17a-5, 17 CFR 240.17a-12, or 17 CFR 240.l Ba-7, as applicable.
- □ (r) Compliance report in accordance with 17 CFR 240.l 7a-5 or 17 CFR 240.lBa-7, as applicable.
- □ (s) Exemption report in accordance with 17 CFR 240.17a-5 or 17 CFR 240.l Ba-7, as applicable.
- txl (t) Independent public accountant's report based on an examination of the statement of financial condition.
- D (u) Independent public accountant's report based on an examinat ion of the financial report or financial statements under 17 CFR 240.17a-5, 17 CFR 240.lBa-7, or 17 CFR 240.17a-12, as applicable.
- D (v) Independent public accountant's report based on an examination of certain statements in the compliance report under 17 CFR 240.17a-5 or 17 CFR 240.lSa-7, as applicable.
- D (w) Independent public accountant's report based on a review of the exemption report under 17 CFR 240.l 7a-5 or 17 CFR 240.lBa-7, as applicable.
- D (x) Supplemental reports on applying agreed-upon procedures, in accordance with 17 CFR 240.15c3-le or 17 CFR 240.17a-12, as applicable.
- D (y) Report describing any material inadequacies found to exist or found to have existed since the date of the previous audit, or a statement that no material inadequacies exist, under 17 CFR 240.17a-12(k). <sup>D</sup>(z) Other:------------------------ -------------
- 
- *\*\*To request confidential treatment of certain portions of this filing, see 17 CFR 240.17a-5(e){3} or 17 CFR 240.18a-7(d}(2}, as applicable.*

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# TABLE OF CONTENTS

|                                                         | Page No. |
|---------------------------------------------------------|----------|
| REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM |          |
| FINANCIAL STATEMENT                                     |          |
| Statement of Financial Condition                        | 2        |
| Notes to Financial Statement                            | 3 - 7    |

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Rolleri & Sheppard CPAS, LLP John M. Rolleri, CPA, CFE Ryan C. Sheppard, CPA, CFF

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#### **REPORT OF INDEPENDENT REG ISTERED PUBLIC ACCOUNTING FIRM**

To the Members of Dunn Rush & Co., LLC

#### **Opinion** on **the Financial Statement**

We have audited the accompanying statement of financial condition of Dunn Rush & Co., LLC as of December 31, 2022, and the related notes (collectively referred to as the "financial statement"). In our opinion, the fi nancial statement presents fairly, in all material respects, the financial position of Dunn Rush & Co., LLC as of December 3 1, 2022 in conformity with accounting principles generally accepted in the United States of America.

#### **Basis** for **Opinion**

This financ ial statement is the responsibility of Dunn Rush & Co., LLC's management. Our responsibility is to express an opinion on Dunn Rush & Co., LLC's financial statement based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to Dunn Rush & Co., 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 statement is free of material misstatement, whether due to error or fraud. Our audit included performing procedures to assess the risks of material misstatement of the financial statement, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examin ing, 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 overa ll presentation of the financial statements. We believe that our audit provides a reasonable basis for our opin ion.

*I(* rt- ..r *c* /YJ-*.>,* c. '-;;

Rolleri & Sheppard CPAS, LLP

We have served as Dunn Rush & Co., LLC's auditor since 20 16.

Fairfield, Connecticut February 24, 2023

> 2150 Po,t Road, 51h rloor • Fairlil'ld, CT 0682.; p:203.25<p727 • l':lop56.2727 "" \\.rolll'ri,hcppardcpa,.com

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# STATEMENT OF FINANCIAL CONDITION December 31, 2022

#### ASSETS

| Cash                                       | S | 634,205 |
|--------------------------------------------|---|---------|
| Interest receivable                        |   | 2,653   |
| Prepaid expenses                           |   | 46,018  |
| Deposits                                   |   | 42,595  |
| Property and equipment, net of accumulated |   |         |
| depreciation of \$3,129                    |   | 101,051 |
|                                            | S | 826,522 |
| LIABILITIES AND MEMBERS' EQUITY            |   |         |
| Accounts payable and accrued expenses      | S | 78,527  |
| Deferred revenue                           |   | 54,167  |
|                                            |   | 132,694 |
| Members' equity                            |   | 693,828 |
|                                            | S | 826,522 |

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### NOTES TO FINANCIAL STATEMENT December 31, 2022 (See Report of Independent Registered Public Accounting Firm)

#### Note 1 Organization and nature of business

Dunn Rush & Co. LLC (the "Company") was formed in 2009 and is a Massachusetts limited liability company. The Company offers merger and acquisition, financial advisory, and private placement services in accordance with the management agreement with the Financial Industry Regulatory Authority ("FINRA"). The Company is a registered broker dealer under the Securities Exchange Act of 1934 and is a member of FINRA and the Securities Investor Protection Corporation ("SIPC").

All member units are restricted from transfer, unless transferred to permitted transferee's as defined in the agreement, without the Company and members being offered the first right to repurchase the units. If the Company and the other members do not exercise their right, the units may be sold to a bona fide third party.

#### Note 2 Summary of significant accounting policies

# Revenue recognition

# Revenue recognition

The Company adheres to the guidance under ASC Topic 606, Revenue from Contracts with Customers ("ASC Topic 606"). The revenue recognition guidance requires that an entity recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance requires an entity to follow a five-step model to (a) identify the contract(s) with a customer, (b) identify the performance obligations in the contract, (c) determine the transaction price, (d) allocate the transaction price to the performance obligations in the contract, and (e) recognize revenue when (or as) the entity satisfies a performance obligation. In determining the transaction price, an entity may include variable consideration only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized would not occur when the uncertainty associated with the variable consideration is resolved.

Revenue from contracts with customers includes fees from investment banking and financial advisory services. The recognition and measurement of revenue is based on the assessment of individual contract terms. Sigmificant judgement 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; and whether constraints on variable consideration should be applied due to uncertain future events.

Revenue from investment banking success fees are generally recognized at the point in time that performance under the arrangement is completed (the closing date of the transaction).

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### NOTES TO FINANCIAL STATEMENT (CONTINUED) December 31, 2022 (See Report of Independent Registered Public Accounting Firm)

#### Note 2 Summary of significant accounting policies (continued)

### Revenue recognition (continued)

Revenue from financial advisory retainer fees are generally recognized over time in which the performance obligations are simultaneously provided by the Company and consumed by the customer.

Revenue from financial advisory valuation fees are generally recognized at the point in time that performance under the arrangement is completed. Retainers and other fees received from customers prior to recognizing revenue are reflected as contract liabilities. At December 31, 2022, contract liabilities were \$54,167. Disaggregation can be found on statement of operations for the year ended December 31, 2022. The statement of operations includes \$33,333 of deferred income from the prior year.

#### Income taxes

The members of the Company have elected to have the Company taxed as a partnership for income tax purposes. Accordingly, the Company is not subject to federal or state income taxes. All taxable income/loss and tax credits are reflected on the income tax returns of the members.

#### Income tax positions

The Financial Accounting Standards Board ("FASB") has issued a standard that clarifies the accounting and recognition of income tax positions taken or expected to be taken in the Company's income tax returns. The Company has analyzed tax positions taken for filing with the Internal Revenue Service and all state jurisdictions where it operates. The Company believes that income tax positions will be sustained upon examination and does not anticipate any adjustments that would result in a material adverse affect on the Company's financial condition, results of operations or cash flows.

Accordingly, the Company has not recorded any reserves or related accruals for interest and penalties for uncertain income tax positions.

If the Company incurs interest or penalties as a result of unrecognized tax positions the policy is to classify interest accrued with interest expense and penalties thereon with operating expenses. The Company is subject to routine audits by taxing jurisdictions; however, there are currently no audits for any tax periods in progress.

### Fair value of financial instruments

The carrying amounts of financial instruments, including cash, prepaid expenses, deposits, and accounts payable and accrued expenses, approximates fair value due to the short term maturities of these assets and liabilities.

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### NOTES TO FINANCIAL STATEMENT (CONTINUED) December 31, 2022 (See Report of Independent Registered Public Accounting Firm)

#### Note 2

#### Use of estimates

Management uses estimates and assumptions in preparing financial statements. Those estimates and assumptions affect the reported amount of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses. Actual results could differ from those estimates.

#### Advertising

The Company expenses the cost of advertising as it is incurred. Advertising expense amounted to \$12,791 for the year ended December 31, 2022.

#### Property and equipment

Property and equipment is stated at cost. Depreciation is calculated on the straight-line method over the estimated useful life of the related asset.

|                        | Estimated   |
|------------------------|-------------|
| Description            | Useful Lite |
|                        |             |
| Property and equipment | 5-7 years   |

Advertising expense amounted to \$12,791 for the year ended December 31, 2022.

#### Subsequent events

The Company has evaluated subsequent events through February 24, 2023, which is the date the financial statements were available to be issued.

#### Note 3 Net capital requirements

The Company is subject to the Securities and Exchange Commission's Uniform Net Capital Rule (Rule 15c3-1), which requires the maintenance of a minimum net capital balance and requires that the Company's aggregate indebtedness to net capital, as defined, shall not exceed 15 to 1. At December 31, 2022 the Company's net capital was \$504,164 which was \$495,318 in excess of its required net capital of \$8,846. The Company's aggregate indebtedness to net capital was 0.26 to 1.

#### Note 4 Concentrations

### Customers

For the year ended December 31, 2022, three customers represented 95% of the Company's revenue.

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### NOTES TO FINANCIAL STATEMENT (CONTINUED) December 31, 2022 (See Report of Independent Registered Public Accounting Firm)

#### Note 4 Concentrations (continued)

#### Cash

The Company maintains its cash at financial institutions in bank deposits, which may exceed federally-insured limits. The Company has not experienced any losses in such accounts and the Company believes it is not exposed to any significant risk with respect to cash. Bank balances in excess of FDIC limits is \$189,867.

#### Note 5 Leases Commitments

For the year ended December 31, 2022, the Company leased its virtual premises under a month to month agreement for \$355/month. The Company also leased additional working premises under a month to month agreement for \$1,575/month. Rent expense was \$27,284 for the year ended December 31, 2022.

The Company has a lease agreement commencing on January 1, 2023. The Company will record a lease liability for the present value of the future lease payments, using a discount rate of 6% which is the Company's estimated incremental borrowing rate for loans with similar terms. A right-of-use asset will be recorded in the amount of the lease liability. Lease costs are being recognized on a straight-line basis over the term of the lease. Future lease payments under a non-cancellable operating leases with initial terms in excess of one year are as follows:

| 2023                        | \$ 63.360 |
|-----------------------------|-----------|
| 2024                        | 127,987   |
| 2025                        | 130.547   |
| 2026                        | 133.158   |
| 2027                        | 135.821   |
| Thereafter                  | 279.846   |
| Total future lease payments | 870.719   |

#### Note 6 Commitments and Contingencies

The Company does not have any commitments, guarantees or contingencies including arbitration or other litigation claims that may result in a loss or future obligation. The Company is not aware of any threats or other circumstances that may lead to the assertion of a claim at a future date.

#### Note 7 Exemption from Rule 15c3-3

The Company amended its membership agreement with FINRA on October 6, 2020 and will not claim exemption from the provisions of Rule 15c3-3 of the SEC, in reliance on footnote 74 to SEC Release 34-70073.

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### NOTES TO FINANCIAL STATEMENT (CONTINUED) December 31, 2022 (See Report of Independent Registered Public Accounting Firm)

#### Defined Contribution Retirement Plan Note 8

In 2016 the Company adopted a defined contribution plan. The plan is a 401K/profit sharing plan and is eligible to all employees and members of the Company meeting certain eligibility. Eligible employees can elect to defer a portion of their salary or guaranteed payment to the 401k plan, while the Company can contribute a discretionary amount for profit sharing. For the year ended December 31, 2022, the Company contributed \$105,850 to the plan.

#### Note 9 Defined Benefit Pension Plan

On December 29, 2016 the Company adopted a defined benefit pension plan (the Plan) with an effective date of January 1, 2016. The Plan covers all employees and members of the Company meeting certain eligibility requirements. As of December 31, 2022 one employee and the two members of the Company met the criteria for eligibility. The Company's funding policy is to contribute an amount equal to or greater than the minimum funding requirements of the Employee Retirement Income Security Act of 1974, as determined under actuarial assumptions based upon percentage of payroll or selfemployment income costs. The contributed amounts will not exceed the maximum tax deductible limit. The Plan will invest primarily in publicly traded securities including equities and fixed income instruments. The amount funded for the year ended December 31, 2022 is \$300,000 and is recorded as pension expense for the year. The Company's share of the actuarially determined projected benefit obligation at December 31, 2022 is \$1,983,600 and the accumulated benefit obligation is \$1,983,600. This is based upon end of year valuations. These amounts were calculated using the following assumptions:

| Pre-retirement interest rate  | 5% |
|-------------------------------|----|
| Post retirement interest rate | 5% |

The total benefits payable as monthly annuities are expected to be as follows:

| From 2023 through 2026    | \$396,246   |
|---------------------------|-------------|
| From 2027 through 2032    | \$777,320   |
| Lump sum payments at 2023 | \$1,038,975 |

#### Note 10 Risk and uncertainties

The Company has evaluated subsequent events through the date at which these financial statements were available to be issued and determined there have not been any events that have occurred that would require adjustments to or disclosure in the financial statements.


Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.