# FINANCO SECURITIES, LLC X-17A-5 (2021-03-01) — Broker-dealer annual report - Company: FINANCO SECURITIES, LLC - Form: X-17A-5 - Filed: 2021-03-01 - Period: 2020-12-31 - Accession: 0001571558-21-000001 - CIK: 1571558 - File #: 8-69251 - Material weakness: No - Auditor: Daszkowski, Tompkins, Weg & Carbonella CPA PC - Auditor location: Matawan, NJ - Contact: Scott Abrams - Phone: 2125937385 - Signed by: Scott Abrams (FinOp) Original filing: https://www.sec.gov/Archives/edgar/data/1571558/000157155821000001/2020Short6.pdf --- {0}------------------------------------------------ FINANCO SECURITIES, LLC Statements of Financial Condition December 31, 2020 {1}------------------------------------------------ Public UNITED STATES SECURITIES ANDEXCHANGE COMMISSION Washington, D.C. 20549 OMB APPROVAL OMB Number: 3235-0123 Expires: Estimated average burden hours per response.. . . . . . . 12.00 # ANNUAL AUDITED REPORT FORM X-17A-5 PART III | SEC FILE NUMBER | |-----------------| | 8-6925 | 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 1/1/2020 | | AND ENDING 12/31/2020 | | | |--------------------------------------------------------------------------|---------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------------|-------------------|--| | | MM/DD/YY | | MM/DD/YY | | | | A. REGISTRANT IDENTIFICATION | | | | | NAME OF BROKER-DEALER: Financo Securities, LLC | | | OFFICIAL USE ONLY | | | ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use P.O. Box No.) | | | FIRM I.D. NO. | | | 540 Madison Avenue - 3rd Floor | | | | | | | (No. and Street) | | | | | New York | NY | 10022 | | | | (City) | (State) | | (Zip Code) | | | Scott Abrams | | NAME AND TELEPHONE NUMBER OF PERSON TO CONTACT IN REGARD TO THIS REPORT
(212) 593-7385
(Area Code - Telephone Number) | | | | | B. ACCOUNTANT IDENTIFICATION | | | | | INDEPENDENT PUBLIC ACCOUNTANT whose opinion is contained in this Report* | | | | | | Daszkowski, Tompkins, Weg & Caronella, CPA, P.C. | | | | | | | (Name - if individual, state last, first, middle name) | | | | | 278 Route 34 | Matawan | NJ | 07747 | | | (Address) | (City) | (State) | (Zip Code) | | | CHECK ONE: | | | | | | 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 240.17a-5(c)(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. {2}------------------------------------------------ | | 20 | |--------------------------------------------------------------|----| | | | | ELAINE M. COST
NOTARY PUBLIC, STATE OF NEW YORK | | | Registration No. 01CO6388093
Qualified in New York County | | | Commission Expires
February 25, 2023 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | {3}------------------------------------------------ DASZKOWSKI, TOMPKINS, WEG & CARBONELLA, P.C. Certified Public Accountants & Advisors Walter Daszkowski, CPA, PFS Michele Tompkins, CPA Mark Weg, CPA, PFS Dan Carbonella, CPA Michael R. Ferraro, CPA Richard P. Wismer, CPA # REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Member of Financo Securities, LLC # Opinion on the Financial Statement We have audited the accompanying statement of financial condition of Financo Securities, LLC as of December 31, 2020, 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 Financo Securities, LLC as of December 31, 2020 in conformity with accounting principles generally accepted in the United States of America. ### Basis for Opinion This financial statement is the responsibility of Financo Securities, LLC's management. Our responsibility is to express an opinion on Financo 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 Financo 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. Storghouslin Jourphies, Wes & Carbonella, CAA, P.C. Daszkowski, Tompkins, Weg & Carbonella, CPA, P.C. We have served as Financo Securities, LLC auditor since 2015. Matawan, NJ February 26, 2021 {4}------------------------------------------------ # FINANCO SECURITIES, LLC Statement of Financial Condition December 31, 2020 | | 2020 | | |--------------------------------------------------------------------------|------|---------| | Assets | | | | Cash | S | 72,151 | | Accounts Receivable | | 25,000 | | Prepaid Expenses | | 3,023 | | Total Assets | S | 100,174 | | Liabilities and Member's Equity
Accounts Payable and Accrued Expenses | S | 22,976 | | Member's Equity
Member's Equity | | 77,198 | | Total Liabilities and Member's Equity | S | 100,174 | The accompanying notes are an integral part of these financial statements. {5}------------------------------------------------ # FINANCO SECURITIES, LLC NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2020 ### 1 - Organization and Nature of Operations of Business Financo Securities, LLC (the "Company"), is a broker-dealer registered with the SEC and is a member of the Financial Industry Regulatory Authority (FINRA). The Company was formed as a limited liability company with the State of Delaware on August 23, 2012, and became a brokerdealer on March 12, 2014 and is wholly-owned subsidiary of Financo, LLC (the "Parent" and sole "Member"). The Company engages in investment banking, financial advisory, capital-raising services, equity private placements, and merger and acquisition advice. The Company does not carry securities accounts for customers or perform custodial functions relating to customer securities. ### 2 - Significant Accounting Policies #### Basis of presentation The accounting policies and reporting practices of the Company conform to the predominant practices in the broker-dealer industry and are in accordance with the accounting principles generally accepted in the United States of America. #### Use of estimates The preparation of the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. #### Statement of Cash Flows For the purposes of the Statement of Cash Flows, the Company has defined cash equivalents as liquid investments, with original maturities of less than three months that are not held for sale in the ordinary course of business. #### Accounts Receivable Accounts receivable are stated at the amount management expects to collect from balances outstanding at the end of the year. Based on management of the credit history with clients having outstanding balances and current relationships with them it has been concluded that realization of losses on balances outstanding at year-end will be immaterial. #### Income taxes The Company is a single-member limited liability company that will be treated as a disregarded entity for tax purposes. Its income is includes in the Parent's tax return, as such, there is no income tax provision required on these financial statements. The Parent is subject to New York City Unincorporated Business Tax for the Company's income; therefore, the Company calculates the provision for income taxes on a standalone basis by applying the statutory tax rate to its income before taxes per books. This hypothetical tax provision is paid to the Parent for reporting and its payment to the tax authority. {6}------------------------------------------------ # FINANCO SECURITIES, LLC NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2020 ## 3 - Revenue from Contracts with Customers #### Significant judgements Revenue from contracts with customers includes advisory fees from investment banking services. 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; 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. #### Investment Banking The Company provides advisory services on mergers and acquisitions (M&A). Revenue for advisory arrangements is generally recognized at the point in time that performance under the arrangement is completed (the closing date of the transaction) or it is determined that the engagement will not proceed (the agreement has been terminated or will not proceed due to changes in the economic conditions of the client). However, for certain contracts, revenue is recognized over time for advisory arrangements in which the performance obligations are simultaneously provided by the Company and consumed by the customer. In some circumstances, significant judgment is needed to determine the timing and measure of progress appropriate for revenue recognition under a specific contract. #### Revenue from contracts with customers Investment banking services \$30.626.903 #### 4 - Fair Value Measurement The Company follows FASB ASC Section 820 for fair value measurements which defines fair value and establishes a fair value hierarchy organized into three levels based upon the input assumptions used in valuing assets and liabilities. Level 1 inputs have the highest reliability and are for identical assets and liabilities with unadjusted quoted prices in active markets. Level 2 inputs relate to assets and liabilities with unadjusted quoted prices in active market which are observable either directly or indirectly. Level 3 inputs are unobservable inputs for the asset or liability and are used to the extent that observable inputs do not exist. As of December 31, 2020, none of the assets and liabilities was required to be reported at fair value on a recurring basis. The carrying value of non-derivative financials instruments, including cash, accounts receivable, prepaid expenses and accounts payable, approximate their fair values due to the short term nature of these financial statements. There were no changes in methods or assumptions during the year ended December 31, 2020. #### 5 - Commitments and Contingent Liabilities The Company has evaluated commitments and contingencies in accordance with FASB ASC 440, Commitments, and FASB ASC 450, Contingencies. Management has determined that no significate commitments and contingencies exists as of December 31, 2020. {7}------------------------------------------------ # ),1\$1&26(&85,7,(6//& 127(672),1\$1&,\$/67\$7(0(176 '(&(0%(5 # **±&RQFHQWUDWLRQVRI&UHGLW5LVNIRU&DVK** 7KH&RPSDQ\PD\GXULQJWKHRUGLQDU\FRXUVHRIEXVLQHVVPDLQWDLQDFFRXQWEDODQFHVZLWKEDQNV LQH[FHVVRIIHGHUDOO\LQVXUHGOLPLWV7KH&RPSDQ\KDVQRWH[SHULHQFHGORVVHVRQWKHVHDFFRXQWV DQGPDQDJHPHQWEHOLHYHVWKDWWKH&RPSDQ\LVQRWH[SRVHGWRVLJQLILFDQWULVNVRQVXFKDFFRXQWV # **±\*XDUDQWHHV** )\$6%& \$6& *Guarantees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¶V IDLOXUH WR SHUIRUP XQGHU DQ DJUHHPHQW DV ZHOO DV LQGLUHFWJXDUDQWHHVRIWKHLQGHEWHGQHVVRIRWKHUV 7KH&RPSDQ\KDVLVVXHGQRJXDUDQWHHVDW'HFHPEHURUGXULQJWKH\HDUWKHQHQGHG # **±1HW&DSLWDO5HTXLUHPHQWV** 7KH&RPSDQ\LVVXEMHFWWRWKH6HFXULWLHVDQG([FKDQJH&RPPLVVLRQ8QLIRUP1HW&DSLWDO5XOH 6(&5XOHF ZKLFKUHTXLUHVWKHPDLQWHQDQFHRIPLQLPXPQHWFDSLWDODQGUHTXLUHVWKDWWKH UDWLRRIWKHDJJUHJDWHLQGHEWHGQHVVWRQHWFDSLWDOERWKDVGHILQHGVKDOOQRWH[FHHGWRDQG WKHUXOHRIWKHµDSSOLFDEOH¶H[FKDQJHDOVRSURYLGHVWKDWHTXLW\FDSLWDOPD\QRWEHZLWKGUDZQRU FDVKGLYLGHQGVSDLGLIWKHUHVXOWLQJQHWFDSLWDOUDWLRZRXOGH[FHHGWR \$VRI'HFHPEHU WKH&RPSDQ\KDGQHWFDSLWDORIZKLFKH[FHHGHG UHTXLUHPHQWVE\7KH &RPSDQ\¶VQHWFDSLWDOUDWLRZDVWR # **±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{8}------------------------------------------------ # FINANCO SECURITIES, LLC NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2020 ## 10-COVID-19 During the 2020 calendar year, the World Health Organization has declared COVID-19 to constitute a "Public Health Emergency of International Concern". This pandemic has disrupted economic markets and the economic impact, duration and spread of the COVID-19 virus is uncertain at this time. The financial performance of the Company is subject to future developments related to the COVID-19 outbreak and possible government advisories and restrictions placed on the financial markets and business activities. The impact on financial markets and the overall economy, all of which are highly uncertain, cannot be predicted. If the financial markets and/or the overall economy are impacted for an extended period the Company's results may be materially affected. At this stage, the impact on our business and results has not been significant and based on our experience to date we expect this to remain the case. The financial statements do not include any adjustments that might result from the uncertainty relating to COVID-19. ### 11 - Subsequent Events The Company has performed an evaluation of events that have occurred subsequent to December 31, 2020, and to the day its financial statements were available to be issued. On December 16, 2020, Raymond James Financial, Inc. (NYSE: RJF), entered into a definitive agreement to acquire Financo Securities, LLC's parent company Financo LLC. The acquisition is currently under review by the Financial Conduct Authority and is anticipated to close during the second quarter of 2021.No additional material subsequent events were identified during this period. Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.