# MBS CAPITAL MARKETS, LLC X-17A-5 (2020-02-27) — Broker-dealer annual report
- Company: MBS CAPITAL MARKETS, LLC
- Form: X-17A-5
- Filed: 2020-02-27
- Period: 2019-12-31
- Accession: 0001500531-20-000002
- CIK: 1500531
- File #: 8-68690
- Material weakness: No
- Auditor: Accell
- Auditor location: Tampa, FL
- Contact: Edwin Bulleit
- Phone: 8132812700
- Email: form@sipe.org
- Website: sipe.org
- Signed by: Edwin Bulliet (Managing Member)
Original filing: https://www.sec.gov/Archives/edgar/data/1500531/000150053120000002/mbsaudit2019.pdf
---
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UNITED STATES SECURITIES ANDEXCHANGE COMMISSION Washington, D.C. 20549
# ANNUAL AUDITED REPORT FORM X-17A-5 PART III
OMB APPROVAL OMB Number: 3235-0123 August 31, 2020 Expires: Estimated average burden hours per response .. . . . . . . . 12.00
SEC FILE NUMBER
8-68690
FACING PAGE
Information Required of Brokers and Dealers Pursuant to Section 17 of the Securities Exchange Act of 1934 and Rule 17a-5 Thereunder
MM/DD/YY
REPORT FOR THE PERIOD BEGINNING 01/01/19
MM/DD/Y Y
AND ENDING 12/31/19
## A. REGISTRANT IDENTIFICATION
| NAME OF BROKER-DEALER: MBS Capital Markets, LLC | | | | |
|-------------------------------------------------|--|--|--|--|
|-------------------------------------------------|--|--|--|--|
ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use P.O. Box No.)
# 3414 Bay to Bay Blvd, Suite 300
| | (No. and Street) | |
|--------------------------------------------------------------------------------------------|------------------------------|----------------------------------|
| | Florida | 33629 |
| (City) | (State) | (Zip Code) |
| NAME AND TELEPHONE NUMBER OF PERSON TO CONTACT IN REGARD TO THIS REPORT
Edwin M Bulleit | | 813-281-2700 |
| | | . (Area Code - Telephone Number) |
| | B. ACCOUNTANT IDENTIFICATION | |
INDEPENDENT PUBLIC ACCOUNTANT Whose opinion is contained in this Report ACCELL Audit & Compliance, P.A.
(Name - if individual, state last, first, middle name)
\*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(c)(2)
Potential persons who are to respond to the collection of
### SEC 1410 (11-05)
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
## Edwin M Bulleit
, swear (or affirm) that, to the best of
·, as
my knowledge and belief the accompanying financial statement and supporting schedules pertaining to the firm of MBS Capital Markets, LLC
of December 31 20 19 are true 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:
- > (a) Facing Page.
- V (b) 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 Changes in Financial Condition. V
- (e) Statement of Changes in Stockholders' Equity or Partners' or Sole Proprietors' Capital.
- Statement of Changes in Liabilities Subordinated to Claims of Creditors. (1)
- (g) Computation of Net Capital. >
- (h) Computation for Determination of Reserve Requirements Pursuant to Rule 15c3-3.
- ਕਰ (i) Information Relating to the Possession or Control Requirements Under Rule 15c3-3.
- \_ (j) A Reconciliation, including appropriate explanation 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.
- (1) An Oath or Affirmation. V
- (m) A copy of the SIPC Supplemental Report.
- (n) A report describing any material inadequacies found to exist or found to have existed since the date of the previous audit.
\*\* For conditions of confidential treatment of certain portions of this filing, see section 240.17a-5(e){3).
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**Financial Statements and Supplementary Information Pursuant to Rule 17a-5 of the Securities Exchange Act of 1934**
**December 31, 2019 (With Reports of Independent Registered Public Accounting Firm Thereon)**
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#### REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Members of MBS Capital Markets, LLC
#### **Opinion on the Financial Statements**
We have audited the accompanying statement of financial condition of MBS Capital Markets, LLC as of December 31, 2019, the related statements of income and members' equity, and cash flows for the year then ended, and the related notes and supplemental information (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of MBS Capital Markets, LLC as of December 31, 2019, 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 MBS Capital Markets, LLC's management. Our responsibility is to express an opinion on MBS Capital Markets, LLC'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 MBS Capital Markets, 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 statements are free of material misstatement, whether due to error or fraud. Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.
#### **Auditor's Report on Supplemental Information**
Schedule I – Computation of Net Capital Under Rule 15c3-1 of the Securities and Exchange Commission; Schedule II – Computation for Determination of Reserve Requirements; and Schedule III – Information Relating to Possession or Control Requirements Under Rule 15c3-3 have been subjected to audit procedures performed in conjunction with the audit of MBS Capital Markets, LLC's financial statements. The supplemental information is the responsibility of MBS Capital Markets, LLC's management. Our audit procedures included determining whether the supplemental information reconciles to the financial statements or the underlying accounting and other records, as applicable; and performing procedures to test the completeness and accuracy of the information presented in the supplemental information. In forming our opinion on the supplemental information, we evaluated whether the supplemental information, including its form and content, is presented in conformity with 17 C.F.R. §240.17a-5. In our opinion, Schedules I, II and III are fairly stated, in all material respects, in relation to the financial statements as a whole.
We have served as MBS Capital Markets, LLC's auditor since 2015.
Tampa, Florida February 27, 2020
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#### **INDEX**
| | Page |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------|
| Report of Independent Registered Public Accounting Firm | 1 |
| Financial Statements: | |
| Statement of Financial Condition | 2 |
| Statement of Income
and Members' Equity | 3 |
| Statement
of Cash Flows | 4 |
| Notes to Financial Statements | 5
-
9 |
| Supplementary Information: | |
| Schedule I: Computation of Net Capital Pursuant to Rule 15c3-1
of the Securities and Exchange Commission | 11 |
| Schedule II
and III: Computation for Determination of Reserve Requirements
and Information Relating to Possession or Control Requirements
Under Rule 15c3-3
of the Securities and Exchange Commission | 12 |
| Report of Independent Registered Public Accounting Firm
on Applying
Agreed–Upon Procedures Related to an Entity's SIPC Assessment Reconciliation | 13 |
| Form SIPC-7 General Assessment Reconciliation | 14 –
15 |
| Report of Independent Registered Public Accounting Firm | 16 |
| Assertions Regarding Exemption Provisions | 17 |
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#### **Statement of Financial Condition**
#### **December 31, 2019**
#### **Assets**
| Cash and cash equivalents | \$
5,239,406 |
|------------------------------------------------|-----------------|
| Marketable securities, at fair value | 430,154 |
| Other assets | 39,787 |
| Deposits with clearing agency | 150,000 |
| Furniture and equipment, net | 26,514 |
| Total assets | \$
5,885,861 |
| Liabilities and Members' Equity
Liabilities | |
| Accounts payable and accrued liabilities | \$
759,856 |
| Total liabilities | 759,856 |
| Members' equity | 5,126,005 |
| Total liabilities and members' equity | \$
5,885,861 |
2
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**Statement of Financial Condition** Statement of Income and Members' Equity
#### **December 31, 2019**
| Revenue: | |
|--------------------------------------|------------------------|
| Underwriting | \$
6,085,555 |
| Placement | 155,790 |
| Other, net | 74,910 |
| Total revenue | 6,316,255 |
| Expenses: | |
| Employee compensation and benefits | 1,830,019 |
| Other expenses | 1,013,773 |
| Interest expense | 11,612 |
| Total expenses | 2,855,404
2,855,404 |
| Net income | 3,460,851 |
| Members' equity at beginning of year | 7,856,511 |
| Member distributions | (6,191,357) |
| Members' equity at end of year | \$
5,126,005 |
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#### **Statement of Cash Flows**
#### **December 31, 2019**
| Cash flows from operating activities: | |
|--------------------------------------------------|-----------------|
| Net income | \$
3,460,851 |
| Adjustments to reconcile net income to net cash | |
| provided by operating activities: | |
| Depreciation | 8,818 |
| (Increase)decrease in operating assets: | |
| Accounts receivable | 162,200 |
| Other assets | 820 |
| Marketable securities, at fair value | (415,412) |
| Increase(decrease) in operating liabilities: | |
| Accounts payable and accrued liabilities | (197,574) |
| Net cash provided by operating activities | 3,019,703 |
| Cash flows from financing activities: | |
| Member distributions | (6,191,357) |
| Net cash used in financing activities | (6,191,357) |
| Net decrease in cash and cash equivalents | (3,171,654) |
| Cash and cash equivalents at beginning of year | 8,411,060 |
| Cash and cash equivalents at end of year | \$
5,239,406 |
| Supplemental disclosure - cash paid for interest | \$
11,612 |
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#### **Notes to Financial Statements**
#### **December 31, 2019**
#### **(1) Nature of Business**
MBS Capital Markets, LLC (Company) is a broker-dealer registered with the Securities and Exchange Commission (SEC) and is a member of the Financial Industry Regulatory Authority (FINRA). The Company was organized as a limited liability company in Florida in 2010 and is engaged to effect security transactions primarily in land secured municipal bonds.
#### **(2) Summary of Significant Accounting Policies**
#### **(a) Revenue Recognition**
The company recognizes revenue in accordance with Accounting Standards Update (ASU) 2014-09, "*Revenue from contracts with customers*" (Topic 606). Revenue is recognized when a customer obtains control of promised goods or services. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The amount of revenue that is recorded reflects the consideration that the company expects to receive in exchange for those goods or services. The Company applies the following five-step model in order to determine this amount:
- i. Identification of the promised goods in the contract;
- ii. Determination of whether the promised goods are performance obligations, including whether they are distinct in the context of the contract.
- iii. Measurement of the transaction price, including the constraint of variable consideration;
- iv. Allocation of the transaction price of the performance obligations; and
- v. Recognition of revenue when (or as) the Company satisfies each performance obligation.
The Company's main revenue stream is from placement and underwriting fees. The performance obligation associated with a typical underwriting agreement will be satisfied on the trade date, and the fees will be recognized as revenue at that time. The fees are recognized as income based on the percentage of bonds sold. There are no additional costs directly related to the contract.
The Company only applies the five-step model to contracts when it is probable the entity will collect the consideration it is entitled to in exchange for the goods and services it transfers to the customer. Once a contract is determined to be within scope of Accounting Standards Codification (ASC) 606 at contract inception, the Company reviews the contract to determine which performance obligations the Company must deliver and which of these performance obligations are distinct. The Company recognizes as revenues the amount of the transaction price that is allocated to the respective performance obligations when the performance obligation is satisfied or as satisfied. Generally, the Company's performance obligations are transferred to a customer at a point in time typically upon delivery.
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#### **Notes to Financial Statements**
#### **December 31, 2019**
#### **(b) Cash and Cash Equivalents**
The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents.
#### **(c) Accounts Receivable**
Accounts receivable represents balances due for services completed that have yet to be paid. The Company estimates the allowance for doubtful accounts based upon a review of current collectability of existing receivables.
#### **(d) Income Taxes**
As a limited liability company, the Company's taxable income or loss is allocated to its members in accordance with the operating agreement. Therefore, no provision or liability for income taxes has been included in the financial statements.
The Company accounts for income taxes in accordance with ASC Topic 740, "Income Taxes". This standard prescribes a recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. The Company has no uncertain tax positions as of December 31, 2019. The Company's income tax returns are generally subject to taxing authority examinations up to three years after the returns are filed.
### **(e) Marketable Securities**
Marketable securities are reported at fair value based on quoted market prices and have been classified as trading securities with realized and unrealized gains and losses included in net income. All transactions entered into are for the account of and risk of the Company and are recorded on a trade date basis.
#### **(f) Use of 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 various reported amounts and disclosures in the financial statements. Actual results could differ from those estimates.
#### **(g) Recently Issued Accounting Pronouncements**
In February 2016, the Financial Accounting Standards Board (FASB) issued ASU 2016-02, "Leases (Topic 842)." Under this new guidance, lessees (including lessees under leases classified as finance leases, which are to be classified based on criteria similar to that applicable to capital leases under current guidance, and leases classified as operating leases) will recognize a right-to-use asset and a lease liability on the balance sheet, initially measured as the present value of lease payments under the lease. Under current guidance, operating
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#### **Notes to Financial Statements**
#### **December 31, 2019**
leases are not recognized on the balance sheet. The guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted. The new standard must be adopted using a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements; the guidance provides certain practical expedients. The Company adopted this standard January 1, 2019, which had an immaterial impact on the Company's financial statements.
The Company has made an accounting policy election not to apply the recognition provisions of the new lease guidance to short term leases (leases with a lease term of 12 months or less that do not include an option to purchase the underlying asset that the lessee is reasonably certain to exercise); instead the Company will recognize the lease payments for short term leases on a straight-line basis over the lease term.
#### **(3) Concentrations of Credit Risk and Major Customer Information**
The Company maintains all of its cash and cash equivalents in a commercial depository account which is insured by the Federal Deposit Insurance Corporation (FDIC). At times, cash deposits may exceed federally insured limits.
#### **(4) Deposits with Clearing Agency**
The Company entered into a fully disclosed clearing agreement with Pershing, LLC ("Pershing"). Pershing carries the proprietary accounts of the Company and the accounts of the Company's customers introduced to Pershing by the Company.
As of December 31, 2019, the Company had a cash deposit of \$150,000 with Pershing, of which \$100,000 was held by Pershing for potential unresolved Company claims, losses, or expenses incurred by Pershing.
#### **(5) Fair Value of Financial Instruments**
The Company has adopted the provisions of ASC 820, *Fair Value Measurements and Disclosures* (ASC 820). ASC 820 defines fair value, establishes a framework for measuring fair value in accordance with accounting principles generally accepted in the United States of America, and expands disclosures about fair value measurements. ASC 820 establishes a three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value as follows:
- Level 1: Observable inputs such as quoted prices in active markets;
- Level 2: Inputs, other than quoted prices in active markets, that are observable either directly or indirectly; and
- Level 3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.
The asset's fair value measurement level within the fair value hierarchy is based on the lowest level
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#### **Notes to Financial Statements**
#### **December 31, 2019**
of any input that is significant to the fair value measurement. The Company held cash and cash equivalents of \$5,239,406 and deposits with clearing agency of \$150,000 at December 31, 2019, which were considered Level 1 assets. The Company held \$430,154 of marketable securities which consisted of municipal bonds at December 31, 2019. The fair value of municipal bonds is estimated using recently executed transactions, broker quotations, and bond spread information. These bonds are considered Level 2 assets.
The asset's or liability's fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Valuation techniques used need to maximize the use of observable inputs and minimize the use of unobservable inputs.
#### **(6) Commitments and Contingencies**
The Company has two operating leases for office space that expire in January 2020. There is no lease for the Company's Winter Park office as it is being paid on a month to month basis. The new lease for the Tampa Bay office is on an annual basis going forward, expiring on December 31, 2020. Approximate future minimum lease payments required under these operating leases are as follows:
Expense incurred during the year ended December 31, 2019 related to these leases total approximately \$136,368.
#### **(7) Related Party Transactions**
Included in accounts payable and accrued liabilities in the statement of financial condition is approximately \$14,000 due to members for reimbursement of expenses. Also, \$298,007 in employee salary compensation expense for managing members is recorded in the statement of income and members' equity. The Company paid \$69,000 to a profit sharing plan in which they are the Trustee. As of December 31, 2019, the Company accrued \$154,343 related to the profit sharing amount. This number is included in accounts payable and accrued liabilities on the statement of financial condition.
In April 2014, a relative of one of the managing members purchased one of the office buildings that the Company leases. Related expense paid to this related party during the year ended December 31, 2019 was approximately \$65,976.
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#### **Notes to Financial Statements**
#### **December 31, 2019**
#### **(8) Indemnifications**
In the normal course of business, the Company indemnifies and guarantees Pershing against specified potential losses in connection with their acting as an agent of, or providing services to, the Company. The maximum potential amount of future payments that the Company could be required to make under these indemnifications cannot be estimated. However, the Company believes that it is unlikely it will have to make material payments under these arrangements and has not recorded any contingent liability in the financial statements for these indemnifications.
#### **(9) Net Capital Requirements**
The Company is subject to SEC Uniform Net Capital Rule 15c3-1, which requires the maintenance of minimum regulatory net capital and a specified ratio of aggregate indebtedness to regulatory net capital. At December 31, 2019, the Company had net capital of \$5,022,179 which exceeded the capital requirement of \$100,000 by \$4,922,179. The Company's ratio of aggregate indebtedness to net capital was 0.15 to 1 at December 31, 2019.
### **(10) Employee Benefit Plan**
Effective October 1, 2012, the Company established the Trustees of MBS Capital Markets, LLC 401(k) Retirement and Savings Plan (the Plan) with Securian Company, a division of Minnesota Life Insurance Company. Under the terms of the Plan, employees may contribute up to 100% of their compensation subject to IRS limitations. The Company matches at least 3% of Plan compensation and, at its discretion, may make additional contributions. The Company's contributions to the Plan for the year ended December 31, 2019 were \$154,342. Plan contributions are included in employee compensation and benefits in the statement of income and members' equity and in accounts payable and accrued liabilities on the statement of financial condition.
#### **(11) Exemption Under Section (k)(2)(ii)**
The Company operates pursuant to the (k)(2)(ii) exemptive provisions of SEC Rule 15c3-3.
#### **(12) Subsequent Events**
The Company has evaluated events and transactions for potential recognition and disclosure through February 27, 2020 the date which the financial statements were available to be issued.
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**Supplementary Information Pursuant to Rule 17a-5 of the Securities Exchange Act of 1934 as of December 31, 2019**
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#### **Schedule I: Computation of Net Capital Pursuant to Rule 15c3-1 of the Securities and Exchange Commission**
#### **December 31, 2019**
| Computation of net capital: | | |
|--------------------------------------------------|----|-----------|
| Members' equity | S | 5,126,005 |
| Less non-allowable assets: | | |
| Other assets | | (66,301) |
| Net capital before haircuts | 8 | 5,059,704 |
| Haircuts on security positions | | 37.525 |
| Net capital | S | 5,022,179 |
| Aggregate indebtedness: | | |
| Total aggregate indebtedness - total liabilities | 69 | 759,856 |
| | | |
| Computation of basic net capital requirement: | | |
| Minimum net capital required | S | 100,000 |
| Excess net capital | S | 4,922,179 |
| Ratio of aggregate indebtedness to net capital | | 0.15 |
| | | |
A reconciliation with the Company's computation (included in Part II of Form X-17A-5 as of December 31, 2019, as amended on February 11, 2020 is not presented as there are no material differences.
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#### **Schedule II and III: Computation for Determination of Reserve Requirements and Information Relating to Possession or Control Requirements Under Rule 15c3-3 of the Securities and Exchange Commission**
#### **December 31, 2019**
The Company is not required to file the above schedule as it claims exemption from Rule 15c3-3 under Paragraph (k)(2)(ii) of the Rule.
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#### REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM ON APPLYING AGREED-UPON PROCEDURES
Members of MBS Capital Markets, LLC
In accordance with Rule 17a-5(e)(4) under the Securities Exchange Act of 1934 and with the Securities Investor Protection Corporation (SIPC) Series 600 Rules, we have performed the procedures enumerated below and were agreed to by MBS Capital Markets, LLC and the SIPC, solely to assist you and SIPC in evaluating MBS Capital Markets, LLC's compliance with the applicable instructions of the General Assessment Reconciliation (Form SIPC-7) for the year ended December 31, 2019. MBS Capital Markets, LLC's management is responsible for its Form SIPC-7 and for its compliance with those requirements. This agreed-upon procedures engagement was conducted in accordance with standards established by the Public Company Accounting Oversight Board (United States) and in accordance with attestation standards established by the American Institute of Certified Public Accountants. The sufficiency of these procedures is solely the responsibility of those parties specified in this report. Consequently, we make no representation regarding the sufficiency of the procedures described below either for the purpose for which this report has been requested or for any other purpose. The procedures we performed and our findings are as follows:
- 1) Compared the listed assessment payments in Form SIPC-7 with respective cash disbursement records entries, noting no differences;
- 2) Compared the Total Revenue amount reported on the Annual Audited Report Form X-17A-5 Part III for the year ended December 31, 2019 with the Total Revenue amount reported in Form SIPC-7 for the year ended December 31, 2019, noting no differences;
- 3) Compared any adjustments reported in Form SIPC-7 with supporting schedules and working papers, noting no differences;
- 4) Recalculated the arithmetical accuracy of the calculations reflected in Form SIPC-7 and in the related schedules and working papers supporting the adjustments, noting no differences; and
- 5) Compared the amount of any overpayment applied to the current assessment with the Form SIPC-7 on which it was originally computed, noting no differences.
We were not engaged to, and did not conduct an examination or review, the objective of which would be the expression of an opinion or conclusion, respectively, on MBS Capital Markets, LLC's compliance with the applicable instructions of the Form SIPC-7 for the year ended December 31, 2019. Accordingly, we do not express such an opinion or conclusion. Had we performed additional procedures, other matters might have come to our attention that would have been reported to you.
This report is intended solely for the information and use of MBS Capital Markets, LLC and the SIPC and is not intended to be and should not be used by anyone other than these specified parties.
Tampa, Florida February 27, 2020
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| SIPC-7 | |
|----------------|--|
| (36.REV 12/18) | |
### SECURITIES INVESTOR PROTECTION CORPORATION
P.O. Box 92185 Washington, D.C. 20090-2185
202-371-8300 General Assessment Reconciliation
Tor the fiscal year eader 12/31/2019
(Read caratilis the instructions in your Warking Cupy before complating this Formi
#### TO BE FILED BY ALL SIPC MEMBERS WITH FISCAL YEAR ENDINGS
1. Name of Member, address, Designated Evambardy, 1934 Act registiation no, sed month in which tessal year ends for purposes of the audit requirement of SEC Role 17a-5.
| | 10°10 ************************************************************************************************************************************************************************
68690 FINRA DEC
MBS CAPITAL MARKETS LLC
4890 W KENNEDY BLVD STE 940
TAMPA, FL 33609-1850 | | | micale on the form lifed
contact respecting this form | Note If any of the information shown on the
mailing label requires correction, please e-mail
any corrections to form@sipe.org and so
Name and telephone number of person to |
|-----------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------|--------------------------|----------------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| | | | | | |
| | | | | | |
| | 2. A. General Assessment (item 2e from page 2) | | | | 8,330 |
| | B. Less payment made with SIPC-6 liled (exclude interest)
7/30/2019 | | | | 5,050 |
| | Date Paid | | | | |
| | C. Less prior overpayment upplied | | | | |
| | D. Assessment balance due of (overpayment) | | | | 4,280 |
| | E. Interest computed on late payment isee instruction E) for _________________________________________________________________________________________________________________ | | | | |
| | F. Total assessment balance and interest due (or overpayment carried forward) | | | | 4,280 |
| | G. PAYMENT: V the box
Check mailed to P.O. Box J. Funds Wired J
Total (must be same as F above) | ACH T | 4,280 | | |
| | H. Overpayment carried forward | ನ್ | | | |
| | i. Subsidiaties (S) and predecessors (P) included in this lorm (give name and 1934 Ac) registration number);
The SIPC member submitting this lorm and the
erson by whom it is executed represent thereby | | | | |
| hat all information contained herein is true, correct
nd complete. | | | MBS Capital Markets, LLC | | |
| | | | | Summenten Signature! | |
| | Dated the day of NONVory . 2020 | | | MANAGING MEMb | |
| | This form and the assessment payment is due 60 days after the end of the Working Copy of this lorm
lor a period of not less than 6 years, the latest 2 years in an easily accessible place. | | | | |
| | | | | | |
| | Posimaliked Postmarked Calculations
Received | Reviewed | | | |
| | | Documentation | | | Forward Copy |
| | | | | | |
| | | | | | |
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| | | 15 |
|--|--|----|
{19}------------------------------------------------
#### REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Members of MBS Capital Markets, LLC
We have reviewed management's statements, included in the accompanying Exemption Report for SEC Rule 15c3-3, in which (1) MBS Capital Markets, LLC identified the following provisions of 17 C.F.R. §15c3-3(k) under which MBS Capital Markets, LLC claimed an exemption from 17 C.F.R. §240.15c3-3: (k)(2)(ii) (exemption provisions) and (2) MBS Capital Markets, LLC stated that MBS Capital Markets, LLC met the identified exemption provisions throughout the most recent fiscal year without exception. MBS Capital Markets, LLC's management is responsible for compliance with the exemption provisions and its statements.
Our review was conducted in accordance with the standards of the Public Company Accounting Oversight Board (United States) and, accordingly, included inquiries and other required procedures to obtain evidence about MBS Capital Markets, LLC's compliance with the exemption provisions. A review is substantially less in scope than an examination, the objective of which is the expression of an opinion on management's statements. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that should be made to management's statements referred to above for them to be fairly stated, in all material respects, based on the provisions set forth in paragraph (k)(2)(ii) of Rule 15c3-3 under the Securities Exchange Act of 1934.
Tampa, Florida February 27, 2020
{20}------------------------------------------------
#### Assertions Regarding Exemption Provisions
We, as members of management of MBS Capital Markets, LLC (the Company), are responsible for compliance with the annual reporting requirements under Rule 17a-5 of the Securities Exchange Act of 1934. Those requirements compel a broker or dealer to file annual reports with the Securities Exchange Commission (SEC) and the broker or dealer's designated examining authority (DEA). One of the reports to be included in the annual filings is an exemption report prepared by an independent public accountant based upon a review of assertions provided by the broker or dealer. Pursuant to that requirement, the management of the Company hereby makes the follow assertions:
#### Identified Exemption Provision:
The Company claimed exemption from the custody and reserve provisions of Rule 15e3-3 by operating under the exemption provided by Rule 15c3-3, Paragraph (k)(2)(ii) throughout the year ended December 31, 2019.
#### Statement Regarding Meeting Exemption Provision:
The Company met the identified exemption without exception throughout the year ended December 31, 2019.
MBS Capital Markets, LLC
By:
(Name)
Managing Director and Chief Compliance Officer (Title)
(Date)
Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.