# SHARENETT SECURITIES LLC X-17A-5 (2023-03-24) — Broker-dealer annual report

- Company: SHARENETT SECURITIES LLC
- Form: X-17A-5
- Filed: 2023-03-24
- Period: 2022-12-31
- Accession: 0001468209-23-000005
- CIK: 1468209
- File #: 8-68326
- Type: Broker-dealer
- Material weakness: No
- Auditor: ADEPTUS PARTNERS, LLC
- Auditor location: NEW YORK, NY
- Contact: BRIAN MORAN
- Phone: 704-840-5943
- Email: bmoran@sharenett.com
- Website: sharenett.com
- Signed by: BRIAN M MORAN (PRINCIPAL FINANCIAL OFFICER)

Original filing: https://www.sec.gov/Archives/edgar/data/1468209/000146820923000005/sharenettsec2022.pdf

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# PUBLICLY AVAILABLE

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

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

| SEC FILE NUMBER |
|-----------------|
| 8-68326         |

**FACING PAGE** 

**Information Required Pursuant to Rules 17a-5, 17a-12, and 18a-7 under the Securities Exchange Act of 1934** 

| FuNG FoR THE PERIOD BEGmvNie 01/01/2022<br>AND ENDING | 12/31/2022 |  |
|-------------------------------------------------------|------------|--|
| MM/OD/YY                                              | MM/DD/YY   |  |

**A. REGISTRANT IDENTIFICATION** 

# vAMe or R, ShareNett Securities LLC

TYPE OF REGISTRANT (check all applicable boxes):

[ Broker-dealer [] Security-based swap dealer [] Check here if respondent is also an OTC derivatives dealer El Major security-based swap participant

ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use a P.O. box no.)

# 12 East 49th Street Suite 7-120

|                                                                  |                                                            | (No. an Street)       |         |                      |                                           |  |
|------------------------------------------------------------------|------------------------------------------------------------|-----------------------|---------|----------------------|-------------------------------------------|--|
| New York                                                         | New York                                                   |                       |         | 10017                |                                           |  |
| (city)                                                           |                                                            |                       | (State) |                      | (Zip Code)                                |  |
| PERSON TO CONTACT WITH REGARD TO THIS FILING                     |                                                            |                       |         |                      |                                           |  |
| Brian M Moran                                                    | 704-840-5943                                               |                       |         | bmoran@sharenett.com |                                           |  |
| (Name)                                                           | (Area Code -- Telephone Number)                            |                       |         | (Email Address)      |                                           |  |
|                                                                  | B. ACCOUNTANT IDENTIFICATION                               |                       |         |                      |                                           |  |
| Adeptus Partners, LLC<br>244 West 54th Street 9th Floor New York | (Name --if individual, state last, first, and middle name) |                       |         | NY                   |                                           |  |
| (Address)                                                        |                                                            |                       |         | (State)              | 10019<br>(Zip Code)                       |  |
| 01/02/2010                                                       |                                                            | (Cry)                 |         | 3686                 |                                           |  |
|                                                                  |                                                            |                       |         |                      |                                           |  |
|                                                                  |                                                            |                       |         |                      |                                           |  |
| w••<br>Ir<br>of '""'""'''"<br>PCAOB)Hf applicable)               |                                                            | FOR OFFICIAL USE ONLY |         |                      | (PCAOB ,,.m,tton Numbec, ;f appll<able) I |  |

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-5(e)(1)(i), 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 OMB control number.

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### **OATH OR AFFIRMATION**

I, Brian M Moran swear (or affirm) that, to the best of my knowledge and belief, the

financial report pertaining to the firm of Sharenett Securities LLC , as of 12/31 ,20, is true and correct. I further swear (or affirm) that neither the 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.

## Mecklenburg County, NC

7he,''·99g "9lumen: wags ackgwMedged be(pe me on thls day of AS] 2023 by

# **BA4** My<HA€L 9**LA-N ,** who

acknowledged to me that he ar she willingly signed and executed the instrument for he purposes stated in it.

Title:

EN9E.g, 1 *NOTARY FURLIC* Mecklenburg Couty, NC My Commission Czires Jun+ 12.2033 [ •

Principal Financial Officer

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

- **ail** (a) Statement of financial condition.
- □ (b) Notes to consolidated statement of financial condition.
- **!I** (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 5 210.1-02 of Regulation S-X).
- @ii (d) Statement of cash flows.
- ii (e) Statement of changes in stockholders' or partners' or sole proprietor's equity.
- 0 (f) Statement of changes in liabilities subordinated to claims of creditors.
- *ii* (g) Notes to consolidated financial statements.
- ii (h) Computation of net capital under 17 CFR 240.15c3-1 0r 17 CFR 240.18a-1, as applicable.
- [] (i) Computation of tangible net worth under 17 CFR 240.18a-2.
- \_ (j) Computation for determination of customer reserve requirements pursuant to Exhibit A to 17 CFR 240.15c3-3.
- \_ (k) Computation for determination of security-based swap reserve requirements pursuant to Exhibit B to 17 CFR 240.1503-3 or Exhibit A to 17 CFR 240.18a 4, as applicable.
- l (l) Computation for Determination of PAB Requirements under Exhibit A to \$ 240.15c3-3.
- 0 (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 240.18a-4, as applicable.
- [] (0) Reconciliations, including appropriate explanations, of the FOCUS Report with computation of net capital or tangible net worth under 17 CFR 240.15c3-1, 17 CFR 240.18a-1, or 17 CFR 240.18a-2, as applicable, and the reserve requirements under 17 CFR 240.15c3-3 0r 17 CFR 240.18a-4, as applicable, if material differences exist, or a statement that no material differences exist.
- □ (p) Summary of financial data for subsidiaries not consolidated in the statement of financial condition.
- **ii** (q) Oath or affirmation in accordance with 17 CFR 240.17a-5, 17 CFR 240.17a-12, 0r 17 CFR 240.18a-7, as applicable.
- [ (r) Compliance report in accordance with 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable.
- iii (s) Exemption report in accordance with 17 CFR 240.17a-5 0r 17 CFR 240.18a-7, as applicable.
- [ (t)Independent public accountant's report based on an examination of the statement of financial condition.
- **ii** (u) Independent public accountant's report based on an examination of the financial report or financial statements under 17 CFR 240.17a-5, 17 CFR 240.18a-7, 0r 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 240.18a-7, as applicable.
- iii (w) Independent public accountant's report based on a review of the exemption report under 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable.
- **ii** (x) Supplemental reports on applying agreed-upon procedures, in accordance with 17 CFR 240.15c3-1e 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). □ (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()(2), as applicable.*

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## SHARENETT SECURITIES, LLC

Financial Statements and Supplementary Schedules Pursuant to Rule 174-5 under the Securities Exchange Act of 1934

DECEMBER 3 1, 2022

Report of Independent Registered Public Accounting Firm

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# **SHARENETT SECURITIES, LLC Financial Statements for the Year Ended December 31, 2022 Table of Contents**

Report of Independent Registered Public Accounting Firm

# Financial Statements

| Statement of Financial Condition                                                                                                | 3   |
|---------------------------------------------------------------------------------------------------------------------------------|-----|
| Statement of Operations                                                                                                         | 4   |
| Statement of Changes in Member's Equity                                                                                         | 5   |
| Statement of Cash Flows                                                                                                         | 6   |
| Notes to Financial Statements                                                                                                   | 7-8 |
| Supplementary Schedule I- Computation of Net Capital Under<br>Rule 15c3-1 of the Securities and Exchange Commission Act of 1934 | 9   |
| Supplementary Schedule II- Computation for Determination<br>of Reserve Requirements                                             | 10  |
| Supplementary Schedule Ill - Information Relating to<br>the Possession or Control Requirements                                  | 11  |
| Statement of Exemption                                                                                                          | 12  |
| Schedule of the Determination of SIPC Net Operating<br>Revenues and General Assessment                                          | 13  |

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### **REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**

To the Member of ShareNett Securities, LLC

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

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

#### **Basis for Opinion**

This financial statement is the responsibility of ShareNett Securities, LLC's management. Our responsibility is to express an opinion on ShareNett Securities, 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 Share Nett Securities, 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 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.

We have served as ShareNett Securities, LLC's auditor since 2021.

Ocean, NJ March 24, 2023

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## **SHARENETT SECURITIES, LLC STATEMENT OF FINANCIAL CONDITION December 31, 2022**

## ASSETS

| Cash and cash equivalents<br>Advance to affiliate<br>Prepaid expenses and other assets | \$<br>788,796<br>76,366<br>31 780 |
|----------------------------------------------------------------------------------------|-----------------------------------|
| Total assets                                                                           | \$<br>896,942                     |
| LIABILITIES AND MEMBER'S EQUITY                                                        |                                   |
| Liabilities<br>Accounts payable and accrued expenses                                   | \$<br>193,276                     |
| Total liabilities                                                                      | 193 274                           |
| Member's equity                                                                        | 703 666                           |
| Total liabilities and member's equity                                                  | \$<br>896 942                     |

The accompanying notes are an integral part of this financial statement.

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#### **SHARENETT SECURITIES, LLC NOTES TO FINANCIAL STATEMENTS December 31, 2022**

#### NOTE A- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

**Nature of Business:** Sharenett Securities LLC (the "Company"), is a securities broker-dealer registered with the Securities and Exchange Commission ("SEC"), a member of the Financial Industry Regulatory Authority ("FINRA"), and a member of the Securities Investor Protection Corporation ("SIPC"). The Company is a Delaware limited liability company (LLC) and a wholly owned subsidiary of Sharenett Holdings LLC (the "Parent" and sole member). The Company operates as a placement agent specializing in private placements of securities and financial advisory services.

Under its membership agreement with FINRA, and, pursuant to Footnote 74 of SEC Release No. 34-70073, the Company does not carry accounts of or for customers, does not receive customer funds or securities, or self-clear customer transactions through a separate account and does not receive or hold funds or securities for customers, either directly or indirectly, or otherwise owe such funds and securities to customers. Accordingly, the Company is exempt from the requirements of Rule 15c3-3, under the Securities Exchange Act of 1934, pertaining to the possession or control of customer assets and reserve requirements.

**Basis of Presentation:** The accompanying financial statements have been prepared on the accrual basis of accounting in conformity with accounting principles generally accepted in the United States ("GAAP").

**Cash and cash equivalents:** For the purposes of reporting the statement of cash flows, the Company considers all cash accounts, which are not subject to withdrawal restrictions or penalties, and all highly liquid debt instruments purchased with a maturity of three months or less to be cash equivalents. Cash balances in excess of FDIC and similar insurance coverage are subject to the usual banking risks associated with funds in excess of those limits. As December 3 1, 2022, the Company had \$538,796 in excess of the FDIC limit of \$250,000.

**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 and disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the reporting period. Actual results could differ from those estimates.

**Accounts Receivable:** The Company carries accounts receivable on a gross basis, with no discounting for bad debts. It is management's policy to review the trade accounts annually for collectability. There is no collateral held by the Company for accounts receivable. Interest is not accrued on accounts receivable

**Income taxes:** The Company, with the consent of its member, has elected nder the Internal Revenue Code to be a Limited Liability Company for both federal and state income tax purposes. In lieu of corporation income taxes, the members of a Limited Liability Company are taxed on their proportionate share of the Company's taxable income. Therefore, no provision or liability for federal or state income taxes has been included in the financial statements.

The Company has adopted the provisions of FASB Accounting Standards Codification 740-10, Accounting for Uncertainty in Income Taxes. Under ASC 740-10, the Company is required to evaluate each of its tax positions to determine if they are more likely than not to be sustained if the taxing authority examines the respective position. A tax position included in an entity's status, including its status as a pass-through entity, and the decision not to file a tax return. The Company has evaluated each of its tax positions and has determined that no provision or liability for income taxes is necessary. The members and the Company are generally not subject to U.S. federal, state, or local income tax examinations related to the Company's activities for tax years before 2019.

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#### NOTE A- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

#### **Revenue from contracts with customers:**

#### *Significant Judgements*

Revenue from contracts with customers includes placement fees, retainer income, and consulting income. The recognition and measurement of revenue is based on the assessment of individual contract terms. Significant 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; whether revenue should be presented gross or net of certain costs; and whether constraints on variable consideration should be applied due to uncertain future events

#### *Revenue from contracts with customers:*

The Company provides placement services related to capital raising activities. Revenue for placement services is generally recognized at the point in time that performance under the agreement is completed (the closing date of transaction) or the contract is cancelled. In some circumstances, significant judgement is needed to determine the timing and measure of progress appropriate for revenue recognition under a specific contract. Retainers received from customers are nonrefundable and recognized upon execution of the contract. Consulting income received from customers are recognized at a point in time when the services are completed.

**Fair value of financial instruments:** All of the Company's financial assets and liabilities are carried at market value or at amounts, which, because of their short-term nature, approximate current fair value.

#### NOTE B-NET CAPITAL REQUIREMENTS

The Company is subject to the Securities and Exchange Commission Uniform Net Capital Rule (Rule 15c3 1), which requires the maintenance of minimum net capital and requires that the ratio of aggregate indebtedness to net capital, both as defined, shall not exceed 15 to 1. At December 3 1, 2022, the Company had net capital of \$595,520 which was \$345,520 more than its required net capital of \$250,000 and the ratio of aggregate indebtedness to net capital was 32.45 to 1.0.

#### NOTE C- RELATED PARTY TRANSACTIONS

During 2022 the Company had an expense sharing agreement ("ESA") in place with its Parent as it relates to rent, technology, communication and personnel services provided by the Parent. The Company's expenses, pursuant to the terms of the ESA for the year ended December 3 1, 2022, was \$457,364.

### NOTED- BUSINESS CONCENTRATIONS

At December 3 1, 2022, four customers made up approximately 49% of sales

As of December 31, 2022, three registered representatives made up approximately 89% of the outstanding accounts payable balance.

#### NOTE E- COMMITMENTS AND CONTINGENCIES

Contingent liabilities arising from claims, assessments, litigation, fines, penalties, and other sources are recorded when it is probable that liabilities can be assessed and the amount of the assessment and/or remediation can be reasonably estimated.

## NOTE F - ADVANCE TO AFFILIATE

On January 4, 2021, the Company made a \$70,000 advance to an affiliate, ShareNett Holdings, LLC. The advance is due on demand has an implied interest rate of 9%. Accrued interest is payable when called by the parent company. At December 31, 2022, interest accrued on the advance totaled \$6,366.

### NOTE G-SUBSEQUENT EVENTS

The Company has evaluated subsequent events through March 23, 2023, the date which the financial statements were available to be issued and has determined that the Company had no events occurring subsequent to December 3 1, 2022, requiring disclosure.


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