# APTO PARTNERS, LLC X-17A-5 (2020-02-28) — Broker-dealer annual report - Company: APTO PARTNERS, LLC - Form: X-17A-5 - Filed: 2020-02-28 - Period: 2019-12-31 - Accession: 0001506347-20-000001 - CIK: 1506347 - File #: 8-68746 - Material weakness: No - Auditor: J. Velocci & Associates - Auditor location: Denville, NJ - Contact: Juan Espinosa - Phone: 9735436600 - Website: jvafirm.com - Signed by: Juan Espinosa (President & CEO) Original filing: https://www.sec.gov/Archives/edgar/data/1506347/000150634720000001/Public_Doc.PDF --- {0}------------------------------------------------ "PUBLIC" UNITEDSTATES SECURITIES ANDEXCHANGE COMMISSION Washington, D.C. 20549 OMB APPROVAL 3235-0123 OMB Number: Expires: August 31, 2020 Estimated average burden hours per response .. . . . . . 12.00 # ANNUAL AUDITED REPORT FORM X-17A-5 PART III SEC FILE NUMBER 8-68746 FACING PAGE Information Required of Brokers and Dealers Pursuant to Section 17 of the Securities Exchange Act of 1934 and Rule 17a-5 Thereunder | 01/01/2019 | AND ENDING | 12/31/2019 | | | |-----------------------|------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--|--| | MM/DD/Y Y | | MM/DD/Y Y | | | | | | | | | | | | OFFICIAL USE ONLY | | | | | | FIRM I.D. NO. | | | | | | | | | | (No and Street) | | | | | | NJ | | | | | | (State) | | | | | | | | 973-543-6600
(Area Code - Telephone Number) | | | | | | | | | | | | | | | | | | | | | | Denville | NJ | 07834 | | | | (City) | (State) | (Zip Code) | | | | | | | | | | | | | | | | | | | | | | FOR OFFICIAL USE ONLY | | | | | | | | | | | | | | | | | | | | A. REGISTRANT IDENTIFICATION
APTO PARTNERS, LLC
ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use P.O. Box No.)
5 Cold Hill Road South, Suite 11
07945
(Zip Code)
NAME AND TELEPHONE NUMBER OF PERSON TO CONTACT IN REGARD TO THIS REPORT
B. ACCOUNTANT IDENTIFICATION
INDEPENDENT PUBLIC ACCOUNTANT whose opinion is contained in this Report*
J. Velocci & Associates
(Name - if individual, state last, first, middle name)
Accountant not resident in United States or any of its possessions. | | | must be supported by a statement of facts and circumstances relied on as the basis for the exemption. See Section 240.17a-5(e)(2) Potential persons who are to respond to the collection of information contained in this form are not required to respond unless the form displays a currently valid OMB control number. SEC 1410 (06-02) {1}------------------------------------------------ ## OATH OR AFFIRMATION | | JUAN D. ESPINOSA | , swear (or affirm) that, to the best of | |----|---------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------| | | APTO PARTNERS, LLC | my knowledge and belief the accompanying financial statement and supporting schedules pertaining to the firm of
as | | 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; | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Signature | | | | PRESIDENT & CEO | | | | Title | | | | | | | | JOSEF A JAKOSALEM
Notary Public - State of New Jersey | | | | My Commission Expires Mar 28, 2024 | | | This report ** contains (check all applicable boxes):
(a) Facing Page. | | | | (b) Statement of Financial Condition. | | | | (c) Statement of Income (Loss). | | | | (d) Statement of Changes in Financial Condition. | | | | (e) Statement of Changes in Stockholders' Equity or Partners' or Sole Proprietors' Capital. | | | | (f) Statement of Changes in Liabilities Subordinated to Claims of Creditors. | | | | (g) Computation of Net Capital. | | | | (h) Computation for Determination of Reserve Requirements Pursuant to Rule 15c3-3. | | | | (i) Information Relating to the Possession or Control Requirements Under Rule 15c3-3. | (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. | | | | (I) An Oath or Affirmation. | | | | (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). {2}------------------------------------------------ # APTO PARTNERS, LLC ## STATEMENT OF FINANCIAL CONDITION DECEMBER 31 ,2019 FILED PURSUANT TO RULE 17a-5(e)(3) oFTHE SECURITIES AND EXCHANGE ACT OF 1934 AS A PUBLIC DOCUMENT {3}------------------------------------------------ # APTO PARTNERS. LLC December 3'1 , 2019 ## Table of Contents | Report of lndependent Registered Public Accounting Firm
.,.,,,,:,,,,,,1 | | |----------------------------------------------------------------------------|--| | Financial Statement: | | | Statement ofFinancial Condition.,,,,,,
,,.2 | | | Notes to Financial Statements
,,,,,,3-5 | | {4}------------------------------------------------ # VEL0CCI6'A550ClATI515 BROADWAY CIRIIIIID PUBIIC ACCOU||IA|lIS DENVILLE, NJ 07834 # REPORT OF INDEPENDENT REG/STERED PUBLIC AQC,qUNTING FIRM To the Member of Apto Partners, LLC Mendham, New Jersey ### Opinion on the Finoncisl Stotements We have oudited the accompanying stotement of finoncial condition of Apto Portners, LLC (a New lersey Limited Liobitity Company) as of December 3L, 2019 and the reloted notes. ln our opinion, the statement of financiol condition and related notes referred to above present fairly, in all materiol respects, the financiol position of Apto Portners, LLC os of December 37, 2079, in occordance with accounting principles generolly accepted in the lJnited States of Americo. ## Basis for Opinion The statement of financial condition ond reloted notes ore the responsibility of Apto Partners, LLC's manogement. Our responsibitity is to express an opinion on Apto Partners, LLC's stotement of finoncial condition ond related notes based on our audit. We ore o public accounting firm registered with the Pubtic Company Accounting Oversight Boord (lJnited States) (PCAOB) and ore required to be independent with respect to Apto Portners, LLC in occordonce with u,S. federal securities laws and the applicoble rules and regulations of the Securities ond Exchonge Commission ond the PCAOB. We conducted our oudit in occordance with the standords of the PCAOB. Those stondards require that we plan and perform the audit to obtoin reosonable ossuronce about whether the statement of financiat condition and reloted notes are free of moterial misstatement, whether due to error orfroud. Our oudit included performing procedures to dssess the risks of moteriol misstotement of the statement of finoncial condition and related notes, whether due to error or froud, ond performing procedures that respond to those risks. Such procedures include examining, on o test bosis, evidence regarding the amounts and disclosures in the statement of financial condition ond related notes. Our qudit also included evoluating the occounting principles used ond significont estimates made by managemen't, os well os evaluating the overall presentotion of the stotement of financiol condition ond related notes. We believe that our oudit provides a reosonoble bosis for our opinion. We hove served as Apto Partners, LLC's auditor since 2018. J /r"t\* J. Velocci & Associates Denville, New Jersey Februory 24, 2020 PHONE: (973\ 620-9607 FAX: (973) 620-9604 WWW.JVAFIRM.COM {5}------------------------------------------------ # APTO PARTNERS, LLC STATEMENT OF FINANCIAL CONDITION DECEMBER 31 ,2019 #### ASSETS | Cash | | 23,168 | |--------------------------------------------------------------------|-----|----------------------| | Receivables from broker-dealers
Securities owned, at fair value | | 206,981
4,565,973 | | Fixed assets, net | | 244,393 | | TOTAL ASSETS | | 5,040,515 | | | | | | LIABILITIES | | | | Accounts payable and accrued expenses | ,\$ | 29,967 | | Notes payable | | '148,535 | | TOTAL LIABILITIES | | 177,502 | | MEMBER'S EQUITY | | | | TOTAL MEMBER'S EQUITY | | 4,863,013 | | | | | | TOTAL LIABILITIES AND MEMBER'S EQUITY | | 5,040,515 | {6}------------------------------------------------ ## APTO PARTNERS, LLC NOTES TO FINANCIAL STATEMENTS DECEMBER 31.2019 #### 1. ORGANIZATION AND NATURE OF BUSINESS Apto Partners, LLC (the "Company") isa securities broker-dealer registered with the Securities and Exchange Commission (SEC) and is a member of Financial Industry Regulatory Authority ("FlNRA"). The Company conducts business as an introducing broker-dealer and clears all transactions through aclearing organization a fully disclosed basis. The Company is a State of New Jersey Limited Liability Company. #### 2. SIGNIFICANT ACCOUNTING POLICIES #### Basis of Presentation The financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP"), #### Adoption of New Accounting Standards On January 1,2018, the Company adopted ASU 2014-19 Revenue from Contractswith Customers and all subsequent amendments to the ASU (collectively, "ASC 606") The Company's services that fall within the scope of ASC 606 include investment banking income which includes securities transactions and underwriting fees, The implementation of this new accounting standard did not change the revenue recognition policy of the Company, See Revenue from Contracts with Customers for further discussion on the Company's accounting policies for revenue sources within the scope of ASC 606. #### Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affecthe reported amounts of assets and liabilities and disclosure of contingent 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. #### Revenue from Contracts with Customers Securities transactions and related revenues and expenses are recorded on a trade date basis. Underwriting fees are recorded at the time the undenvriting is completed and the income is reasonably determinable #### Fixed Assets, Net Fixed assets are recorded at historical cost, net of accumulated depreciation, Depreciation is calculated on a straightline basis over their economic useful lives, generally from three to thirty-nine years. #### Income Taxes The Company is treated as a sole proprietorship for federal income tax purposes and does not incur income taxes. Instead its earnings and losses are passed through to its member and taxed depending on the personal tax situation. Accordingly, the financial statements do not reflect aprovision from income taxes Distributions were primarily used to meet member's income tax obligations. At December 31 ,2019, there were no significant income tax uncerlainties that would require financial statement recognition. Inaddition, no interest or penalties were recorded. #### Fair Value Measurements The Company records the fair,value of certain financial assets and liabilities on a recurring basis. The accounting standard for fair value provides a hierarchy to measure the quality and reliability of the information used to determine fair values. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financialssets and liabilities carried at fair value will be classified and disclosed in one of the following three categories: {7}------------------------------------------------ Level 1 - Quoted prices in active markets for identical assets or liabilities. Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities, quoted prices in the markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities At December 31 ,2019, all securities owned, which consists of corporate obligations and mutual funds, were valueo using Level 1 inpuis. #### Receivables/Payables to Broker-Dealers Payables to broker-dealers represents netted trading profiUloss, interest income/expense, clearing charges, margin securittes, and deposits with the clearing organization. The Company is required to maintain certain deposit amounts with the clearing organization depending on its clearing activities and as pursuant to the clearing agreement. At December 31, 2019, the Company's required deposit was \$100,000, #### Gash and Cash Equivalents The Company considers cash and cash equivalents amounts in demand deposit accounts at various financial institutions, investments in money market funds, and highly liquid investments, with original maturities ofless than ninety (90) days, which are not held for sale in the ordinary course of business. #### Subsequent Events The Company has evaluated events and transactions that occurred between January 1,2020 and February 24,2020, which is the date the financial statements were to be issued, for possible disclosure and recognition in the financial statements #### 3. CONCENTRATIONS OF CREDIT RISK The Company at times during operations has cash deposits that exceed \$250,000 in one account in individual banks, The Federal Deposit Insurance Corporation (FDIC) insures only the first \$250,000 in member banks. At December 31, 2019, the Company had no uninsured cash balance, #### 4. FIXED ASSETS, NET Fixed assets, net consisted of the following: | Land | | |-------------------------------|--| | Buildings | | | Equipment | | | | | | Less accumulated depreciation | | | qcqate
Fivarl
noi | | #### 5. NOTES PAYABLE The Company has a commercial mortgage agreement with a lender of \$167,120 collateralized bya lien on the property owned by the Company, The scheduled maturity date on the borrowing is November 1, 2030 and bears interest at 4o/o per annum, adjusted every five years at an adjustable rate of 1 875o/o above the Federal Home Loan Bank of New York Fixed-Advance Rate for Five (5) Years At December 31 ,2019, the principal balance on the loan was \$90,907. 'r-h^ /'\^m^^^,, h^^ I rE vvil rvsry ilqD c"l bank loan agreement with a lender of \$101,650 collateralized by a lien on the equipment owned by the Company The scheduled maturity date on the borrowing is April 23,2023 and bears interest at 1.49o/o per annum, At December 31 ,2019, the principal balance on the loan was \$57,628. {8}------------------------------------------------ The Company may, at any time and without obligation, make additional principal payments on the Notes | | Year Endinq December 31 ' 2019 | |----------------------------------|--------------------------------| | ^r^+^^^,,^1,^
\vLqe vqyqurc | 148,535
\$ | | | | Principal payments on notes payable year ending December 31, | 2020 | \$ | 21 ,613 | |------------|----|---------| | 2021 | \$ | 22,082 | | 2022 | \$ | 22,544 | | 2023 | fi | 11,223 | | 2024 | \$ | 5,457 | | Thereafter | \$ | 65,616 | #### 6. NET CAPITAL REQUIREMENTS The Company is subjectto the Securities and Exchange Commission Uniform Net Capital Rule (SEC Rule 15c3-'1), which requires the maintenance of minimum net capital and requires that the ratio of aggregate indebtedness to net capital, bothasdefined, shallnotexceed'l5to1, AtDecember3l,20lg,theCompanyhadnetcapitalof\$3,992,246whichwas \$3,392246inexcessofitsrequirednetcapitalof\$100,000 TheCompany'sratioofaggregateindebtednesstonetcapital was 0.02 to 1 #### 7. RULE 15c3.3 EXEMPTION The Company is exempt from the provisions of Part 240 Rule 15c3-3 of the Securities Exchange Act of 1934 under paragraph (k)(2)(ii) in that the Company as an introducing broker or dealer clears all transactions with and for customers on a fully disclosed basis with a clearing agent, and promptly transmits all customer funds and securities tothe clearing agent who carries all of the accounts of such customers and maintains and preserves such books and records pertaining thereto pursuant to the requirements as are customarily made and kept by clearing agent, #### 8. COMMITMENTS AND CONTINGENCIES #### Litiqation The Company, as part of doing business, may from time to time be involved in legal matters, ln the opinion of management and after consultation with legal counsel, there are no matters, alone or in the aggregate, that are considered to be material to the financial statements. #### Investment Bankinq In the normal course of business, the Company enters into underuvriting commitments. Transactions relating to such undenruriting commitmentshat were open at December 31 ,2019, and were subsequently settled had no material effect on the financial statements as of that date, #### 9. OFF-BALANCE SHEET RISK As a securities broker-dealer, the Company is engaged in various trading and brokerage activities, on an agency and principal basis, in which counterpafties primarily include broker-dealers, banks and other financial institutions. The Company's exposure to off-balance sheet credit risk occurs if a customer, clearing agent or counterparty does not fulfill their obligations arising from a transaction Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.