# PRAIRIE CAPITAL MARKETS, LLC X-17A-5 (2020-11-30) — Broker-dealer annual report - Company: PRAIRIE CAPITAL MARKETS, LLC - Form: X-17A-5 - Filed: 2020-11-30 - Period: 2020-09-30 - Accession: 0001522850-20-000002 - CIK: 1522850 - File #: 8-68889 - Material weakness: No - Auditor: DeMarco Sciaccotta Wilkens & Dunleavy, LLP - Auditor location: Frankfort, IL - Contact: Robert Gross - Phone: 630-443-9933 - Signed by: Timothy Witt (Timothy Witt) Original filing: https://www.sec.gov/Archives/edgar/data/1522850/000152285020000002/PrairiePublicAudit2020.pdf --- {0}------------------------------------------------ ## STATEMENT OF FINANCIAL CONDITION AND REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM SEPTEMBER 30, 2020 {1}------------------------------------------------ **UNITED ST A TES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549** # **ANNUAL AUDITED REPORT FORM X-17A-5 PARTIII** 0MB APPROVAL 0MB Number: 3235-0123 Expires: October 31, 2023 Estimated average burden hours r res nse .. .. . . 12.00 | | SEC FILE NUMBER | |---------|-----------------| | B-68889 | | **FACING PAGE Information Required of Brokers and Dealers Pursuant to Section 17 of the Securities Exchange Act of 1934 and Rule 17a-5 Thereunder** | REPORT FOR THE PERIOD BEGINNING 10/01 /19 | | -----------
AND ENDING 09/30/20 | | | |---------------------------------------------------------------------------------------------------------|--------------------------------------------------------|------------------------------------|-------------------|--------------------------------| | | MM/DD/YY | | MM/DD/YY | | | | A. REGISTRANT IDENTIFICATION | | | | | NAME OF BROKER-DEALER: Prairie Capital Markets, LLC | | | OFFICIAL USE ONLY | | | ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use P.O. Box No.) | | | FIRM 1.0. NO. | | | One Lincoln Center, 18W140 Butterfield, Rd, Suite 800 | | | | | | | (No. and Street) | | | | | Oakbrook Terrace | IL | | 60181 | | | (City) | (State) | | (Zip Code) | | | NAME AND TELEPHONE NUMBER OF PERSON TO CONTACT IN REGARD TO THIS REPORT
Robert Gross
630-443-9933 | | | | | | | | | | (Area Code - Telephone Number) | | | B. ACCOUNTANT IDENTIFICATION | | | | | INDEPENDENT PUBLIC ACCOUNTANT whose opinion is contained in this Report• | | | | | | DeMarco Sciaccotta Wilkens & Dunleavy, LLP | | | | | | | (Name - if individual, state last, first, middle name) | | | | | 9645 Lincolnway Lane 214A | Frankfort | IL | | 60423 | | (Address) | (City) | (State) | | (Zip Code) | | CHECK ONE: | | | | | | I/ I
Certified Public Accountant | | | | | | Public Accountant | | | | | | Accountant not resident in United States or any of its possessions. | | | | | | | FOR OFFICIAL USE ONLY | | | | | | | | | | | | | | | | | | | | | | *\*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. I 7a-5(e)(2)* SEC 1410 (11-05) **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 0MB control number.** {2}------------------------------------------------ #### **OATH OR AFFIRMATION** | 1, Timothy W. Witt | | , swear (or affirm) that, to the best of | |---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------| | my knowledge and belief the accompanying financial statement and supporting schedules pertaining to the firm of
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Prairie Capital Markets, LLC | - | ----------------------,
as | | of September 30 | 2020 | are true and correct. I further swear (or affirm) that | | classified solely as that of a customer, except as follows: | | neither the company nor any partner, proprietor, principal officer or director has any proprietary interest in any account | | MEGAN GILHOOLY .
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Title | | This report•• contains (check all applicable boxes):
0 (a) Facing Page.
0 (b) Statement of Financial Condition.
of Comprehensive Income (as defined in §210.1-02 of Regulation S-X).
0 ( d) Statement of Changes in Financial Condition.
D (e) Statement of Changes in Stockholders' Equity or Partners' or Sole Proprietors' Capital.
D
(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.
Computation for Determination of the Reserve Requirements Under Exhibit A of Rule 15c3-3.
consolidation.
§ (I) An Oath or Affirmation.
(m) A copy of the SIPC Supplemental Report. | | D (c) Statement of Income (Loss) or, if there is other comprehensive income in the period(s) presented, a Statement
D (j) A Reconciliation, including appropriate explanation of the Computation ofNet Capital Under Rule 15c3-1 and the
D (k) A Reconciliation between the audited and unaudited Statements of Financial Condition with respect to methods of | | ••For conditions of confidential treatment of certain portions of this filing, see section 240.17 a-5 (e)(J ). | | (n) A report describing any material inadequacies found to exist or found to have existed since the date of the previous audit. | {3}------------------------------------------------ ![](_page_3_Picture_0.jpeg) ### REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM Managing Member Prairie Capital Markets, LLC #### **Opinion on the Financial Statements** We have audited the accompanying statement of financial condition of Prairie Capital Markets, LLC, (the "Company") as of September 30, 2020, and the related notes (collectively referred to as the financial statements). In our opinion, the statement of financial condition presents fairly, in all material respects, the financial position of Prairie Capital Markets, LLC as of September 30, 2020 in conformity with accounting principles generally accepted in the United States of America. ### **Basis for Opinion** This financial statement is the responsibility of the Company's management. Our responsibility is to express an opinion on the Company'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 the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and 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 Prairie Capital Markets, LLC's auditor since 2012. Frankfort, Illinois November 20, 2020 {4}------------------------------------------------ ### STATEMENT OF FINANCIAL CONDITION ### SEPTEMBER 30, 2020 #### **ASSETS** | Cash | \$
212,255 | |---------------------------------------------------------------------------------|---------------| | Consulting fees receivable, less
allowance for doubtful accounts of \$16,000 | -0- | | Other assets | 2,425 | | TOTAL ASSETS | \$
214,680 | #### **LIABILITIES AND MEMBER'S CAPITAL** | Liabilities
Accounts payable | \$
11,487 | |----------------------------------------|---------------| | Due to related party | 11,693 | | TOTAL LIABILITIES | \$
23,180 | | Member's Capital | \$
191,500 | | TOTAL LIABILITIES AND MEMBER'S CAPITAL | \$
214,680 | The accompanying notes are an integral part of this financial statement. {5}------------------------------------------------ ### NOTES TO STATEMENT OF FINANCIAL CONDITION ### YEAR ENDED SEPTEMBER 30, 2020 #### NOTE 1 - ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES Organization - Prairie Capital Markets, LLC (the "Company"), a limited liability company, was organized in the state of Illinois on July 1, 2010. The Company is a wholly-owned subsidiary of Prairie Capital Holdings, Inc. ("Parent"). The Company is registered with the Securities and Exchange Commission and, is a member of the Financial Industry Regulatory Authority (FINRA). The Company's principal business activity is consulting services. Basis of Presentation - The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America ("GAAP"). Recognition of Revenue – The Company follows the revenue recognition guidance that 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 the performance obligation. Revenues are recognized when control of the promised services is transferred to customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those services. Revenues are analyzed to determine whether the Company is the principal (i.e., reports revenue on a gross basis) or agent (i.e., reports revenues on a net basis) in the contract. Principal or agent designations depend primarily on the control an entity has over the product or service before control is transferred to a customer. The indicators of which party exercises control include primary responsibility over performance obligations, inventory risk before the good or service is transferred and discretion in establishing the price. {6}------------------------------------------------ ### NOTES TO STATEMENT OF FINANCIAL CONDITION ### YEAR ENDED SEPTEMBER 30, 2020 #### NOTE 1 - ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES – *(Continued)* Consulting Fee Revenue – Consulting fee revenue consists primarily of ESOP and financial advisory fees. The Company earns a retainer from its clients based upon the progress of the project. The progress of the project is evaluated quarterly based on; costs and hours charged to the engagement, project manager discussions and project status, to determine the amount of the retainer to be recognized. All retainers received by the Company were earned and recognized on or before September 30, 2020. Significant Judgments - The recognition and measurement of revenue is based on the assessment of individual contract terms. Significant judgment 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. Concentration of Cash - The Company's cash is on deposit at one financial institution and the balance at times may exceed the federally insured limits. The Company believes it is not exposed to any significant credit risk to cash. Receivables - The Company reviews the receivables for collectability on a regular basis. The allowance for doubtful accounts reflects management's best estimate of probable losses determined principally on the basis of historical experience. The allowance for doubtful accounts was \$16,000 at September 30, 2020. Leases - The Company recognizes and measures its leases in accordance with FASB ASC 842, Leases. At September 30, 2020, the Company did not have any lease obligations. Estimates - The preparation of financial statements in conformity with GAAP 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 the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. {7}------------------------------------------------ ### NOTES TO STATEMENT OF FINANCIAL CONDITION ### YEAR ENDED SEPTEMBER 30, 2020 #### NOTE 2 - RELATED PARTY TRANSACTIONS As previously noted, the Company is wholly owned by Prairie Capital Holdings, Inc. ("Parent"). The Company is also affiliated with Prairie Capital Advisors, Inc. ("Advisors") through common ownership. There were no transactions between the Company and Advisors. The company shares office space, employees, and other overhead expenses with its Parent. In accordance with a written agreement, the Company has agreed to reimburse the Parent an amount equal to 2% of the costs that the Parent has incurred for these shared expenses. The expenses incurred to the Parent during the year ended September 30, 2020 pursuant to the agreement are as follows: | Expense | Amount | |----------------|--------------| | Compensation | \$
96,886 | | Occupancy | 13,753 | | Other expenses | 29,673 | | Total | \$ 140,312 | At any time, the Parent has the authority to forgive payment and treat that amount as a non-cash contribution to the Company. There were no non-cash contributions during the year ended September 30, 2020. At September 30, 2020, \$11,693 was due to the Parent, as stated in the statement of financial condition. ### NOTE 3 - NET CAPITAL REQUIREMENTS As a registered broker/dealer and member of the FINRA, 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 1500%. Net capital and aggregate indebtedness change from day to day, but at September 30, 2020, the Company had net capital and a net capital requirement of \$189,075 and \$5,000, respectively. The ratio of aggregate indebtedness to net capital was 12.26%. {8}------------------------------------------------ ### NOTES TO STATEMENT OF FINANCIAL CONDITION ### YEAR ENDED SEPTEMBER 30, 2020 #### NOTE 4 - INCOME TAXES As a single member limited liability company, the Company is not recognized for federal and state income tax purposes as a taxable entity. Therefore, income taxes are the responsibility of the individual shareholders of the Parent. The Company accounts for any potential interest or penalties related to possible future liabilities for unrecognized income tax benefits as other expense. The Company is no longer subject to examination by tax authorities for federal, state, or local income taxes for periods before 2016. #### NOTE 5 - MAJOR CUSTOMERS For the year ended September 30, 2020, approximately 100% of the Company's revenue was derived from five customers. There is no balance due from these companies at September 30, 2020. #### NOTE 6 – REVENUE FROM CONTRACTS WITH CUSTOMERS In regard to ASC Topic 606, revenue has been disaggregated on the Statement of Operations. For presentation purposes, revenue on the Statement of Operations is disaggregated further than what was presented on the FOCUS filings. No further disaggregation is warranted at September 30, 2020. ## . NOTE 7 - CONTINGENCIES In March 2020, the World Health Organization declared the outbreak of a novel coronavirus (COVID-19) as a pandemic which continues to spread throughout the United States. The Company is monitoring the outbreak of COVID-19 and the related business and travel restrictions and changes to behavior intended to reduce its spread, and its impact on operations, financial position, cash flows, customer trends, and the industry in general, in addition to the impact on its employees. Due to the rapid development and fluidity of this situation, the magnitude and duration of the pandemic and its impact on the Company's operations and liquidity is uncertain as of the date of this report. While there could ultimately be a material impact on operations and liquidity of the Company, at the time of issuance, the impact could not be determined. {9}------------------------------------------------ ### NOTES TO STATEMENT OF FINANCIAL CONDITION ### YEAR ENDED SEPTEMBER 30, 2020 #### NOTE 8 - SUBSEQUENT EVENTS The Company has evaluated subsequent events for potential recognition and/or disclosure through the date the financial statements were issued, noting none. Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.