# 16 POINTS LLC X-17A-5 (2024-03-29) — Broker-dealer annual report - Company: 16 POINTS LLC - Form: X-17A-5 - Filed: 2024-03-29 - Period: 2023-12-31 - Accession: 0001647385-24-000001 - CIK: 1647385 - File #: 8-69648 - Type: Broker-dealer - Material weakness: No - Auditor: YSL & Associates LLC - Auditor location: New York, NY - Contact: Linda Grimm - Phone: 212-897-1685 - Signed by: Mark Overley (General Securities Principal) Original filing: https://www.sec.gov/Archives/edgar/data/1647385/000164738524000001/16pts23s.pdf --- {0}------------------------------------------------ ### UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 # ANNUAL REPORTS FORM X-17A-5 PARTIII 0MB APPROVAL 0MB Number: 3235-0123 Expires: Nov. 30, 2026 Estimated average burden hours per response: 12 SEC FILE NUMER 8- 69648 FACJNG PAGE Informa tion Required Pursuant to Rules 17a-5, 17a-12, and 18a-7 under the Securities Exchange Act of 1934 FILING FOR THE PERIOD BEGINNING **01/01/23** AND ENDING **12/31/23** MM/DD/YY MM/DD/YY ### **A. REGISTRANT IDENTIFICATION** NAME OF FIRM: 16 Points LLC TYPE OF REGISTRANT (check all applicable boxes): ~ Broker-dealer O Security-based swap dealer D Major security-based swap participant 0 Check here if respondent is also an OTC derivatives dealer ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use a P.O. box no.) | (Name) | (Area Code - Telephone Number) | (Email Address) | | |----------------|----------------------------------------------|----------------------------------|--| | Linda S. Grimm | (212) 897-1685 | Lgrimm@integra
te d.so1utions | | | | PERSON TO CONTACT WlTH REGARD TO THIS FILING | | | | (City) | (State) | (Zip Code) | | | Vega Alta | PR | 00692 | | | | (No. and Street) | | | | | 10101 Cond Royal Palm | | | INDEPENDENT PUBLIC ACCOUNTANT whose reports are contained in this filing\* # YSL & Associates LLC | (Name - if individual, stale last, first, and middle name) | | | | | | | |------------------------------------------------------------|----------|-------------------------------------------|------------|--|--|--| | 11 Broadway, Suite 700 | New York | NY | 10004 | | | | | (Address) | (City) | (State) | (Zip Code) | | | | | 06/06/2006 | | 2699 | | | | | | (Dale of Registration with PCAOB)(if applicable) | | (PCAOB Registration Number, ifapplicable) | | | | | #### **FOR OFFICIAL USE ONLY** • Claims for exemption from the requiremem thal 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. l 7a-5(e)( I )(ii), if applicable. Persons who nre to r espond to the collection of information contained in this form a re not r equired to respond unless the form displays II currently \'alid Ol\18 control number. {1}------------------------------------------------ ### AFFIRMATION I, Mark Overley , swear (or affirm) that, to the best of my knowledge and belief, the financial report pcrtafoing to 16 Points LLC as of 12/31/23 , is true artd correct. I further 'Wear (or affirm) that neither the company nor any partner, officer, director, or equirnlcnt person. as the case may he, has any proprietary interest in any account classified solely as that of a customer. {2}------------------------------------------------ ### **This filing\*\* contains (check all applicable boxes):** - CEl (a) Statement of financial condition. - D (b) Notes to unconsolidated or consolidated statement of financial condition, as applicable. - 0 (c) Statement of income (loss) or, ifthere 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 (d) Statement of cash flows. - D (e) Statement ofchanges in stockholders' or partners' or members' or sole proprietor's equity, as applicable. - D (f) Statement of changes in liabilities subordinated to claims of creditors. - CEl (g) Notes to unconsolidated or consolidated financial statements,, as applicable. - D (h) Computation of net capital under 17 CFR 240. l 5c3-J or 17 CFR 240. I 8a-I, as applicable. - D (i) Computation of tangible ner worth under 17 CFR 240. J 8a-2. - D U) Computation for determination of customer reserve requirements pursuant to Exhibit A to 17 CFR 240. l 5c3-3. - D (k) Computation for determination of security-based swap reserve requirements pursuant to Exhibit B to 17 CFR 240. I 5c3- 3 or Exhibit A to 17 CFR 240. I 8a-4, as applicable. - D (I) Computation for Determination of PAB Requirements under Exhibit A to§ 240. l 5c3-3. - D (m) Information relating to possession or control requirements for customers under 17 CFR 240. I 5c3-3. - D (n) Information relating to possession or control requirements for security-based swap customers under 17 CFR 240. J 5c3- 3(p)(2) or 17 CFR 240. J 8a-4, as applicable. - D (o) Reconciliations, including appropriate explanations, of the FOCUS Report with computation of net capital or tangible net worth under 17 CFR 240. I 5c3-1, 17 CFR 240. I 8a-I, or 17 CFR 240. I 8a-2, as applicable, and the reserve requirements under 17 CFR 240. J 5c3-3 or 17 CFR 240.18a-4, as applicable, if material differences exist, or a statement that no material differences exist. - 0 (p) Summary of financial data for subsidiaries not consolidated in the statement of financial condition. - CEl (q) Oath or affirmation in accordance with 17 CFR 240. I 7a-5, 17 CFR 240. I 7a- I 2, or 17 CFR 240. l 8a-7. as applicable. - D (r) Compliance report in accordance with 17 CFR 240. l 7a-5 or 17 CFR 240. l 8a-7, as applicable. - D (s) Exemption report in accordance with 17 CFR 240. I 7a-5 or 17 CFR 240. I 8a-7, as applicable. - CEl (t) Independent public accountant's report based on an examination of the statement of financial condition. - D (u) Independent public accountant's report based on an examination of the financial report or financial statements under 17 CFR 240. l 7a-5, 17 CFR 240.1 Sa-7, or 17 CFR 240. I 7a-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. I 7a-5 or 17 CFR 240. l 8a-7, as applicable. - 0 (w) Independent public accountant's report based on a review of the exemption report under 17 CFR 240. I 7a-5 or 17 CFR 240. l 8a-7, as applicable. - D (x) Supplemental reports on applying agreed-upon procedures, in accordance with 17 CFR 240. I 5c3-1 e or 17 CFR 240. l 7a- I 2, 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. I 7a-l 2(k). D (z) Other: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ \_ - *\*\*To request confidential treatment of certain portions of this filing, see 17 CFR 240. l 7a-5(e){3) or 17 CFR 240.* J *8a-7(d)(2), as applicable.* {3}------------------------------------------------ Statement of Financial Condition December 31 , 2023 {4}------------------------------------------------ ![](_page_4_Picture_0.jpeg) 11 Broadway, Suite 700, New York, NY 10004 Tel: (212) 232-0122 Fax: (646) 218-4682 ### **REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM** To the Member of 16 Points LLC #### **Opinion on the Financial Statement** We have audited the accompanying statement of financial condition of 16 Points LLC (the "Company") as of December 31, 2023, 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 the Company as of December 31, 2023 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 pe1forming 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 16 Points LLC's auditor since 2016. New York, NY March 28, 2024 {5}------------------------------------------------ # **Statement of Financial Condition December 31, 2023** | Assets | | |---------------------------------------|---------------| | Cash | \$
118,457 | | Fees receivable | 188,289 | | Prepaid expenses | 13,547 | | Total assets | \$
320,293 | | Liabilities and Member's Equity | | | Accrued expenses | \$
1,583 | | Member's equity | 318,710 | | Total liabilities and member's equity | \$
320,293 | The accompanying notes are an integral part of these financial statements. {6}------------------------------------------------ # **Notes to Financial Statements December 31 , 2023** ### **1. Nature of Operations** 16 Points LLC, (the "Company"), a New York limited liability company, is registered with the Securities and Exchange Commission (the "SEC") and a member of the Financial lndustry Regulatory Authority (''FlNRA"). The Company serves as an introducing broker for the private placement of securities with both institutional and accredited individual investors, provides advisory solutions related to mergers and acquisitions and refer investors, broker-dealers and hedge funds to unaffiliated broker/dealers for order execution and settlement for which it will receive referral fees. The Company is wholly-owned by 16 Points Holdings LLC. ### **2. Summary of Significant Accounting Policies** ### **Basis of Presentation** This financial statement was prepared in conformity with accounting principles generally accepted in the United States of America which 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 statement. Actual results could differ from these estimates. #### **Revenue Recognition** The revenue recognition guidance under Accounting Standards Codification ("ASC") Topic 606, *Revenue from Contracrs with Customers,* requires that an entity recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance 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 a performance obligation. In determining the transaction price, an entity may include variable consideration only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized would not occur when the unce11ainty associated with the variable consideration is resolved. Referral fees on placements are recognized over time based on the placement arrangements in which the assets were invested with the funds. The recognition of these fees aligns with the performance obligations that are simultaneously fulfilled by the Company and consumed by the funds. The private placement success fee is generally recognized at a point in time, usually on the closing date of the transaction, when the Company's performance obi igations under the arrangement are fully satisfied. {7}------------------------------------------------ # **Notes to Financial Statements December 31 , 2023** #### **2. Summary of Significant Accounting Policies (continued)** ### **Revenue Recognition (continued)** The Company earns commissions for introducing clients to a third party, pursuant to a feesharing agreement. These commissions are recorded monthly, commensurate with the occurrence of the security transactions that result from the introductions. The Company's performance obligation for the introduction of clients is considered fulfilled as these security transactions are executed. The beginning and ending balance of receivables, contract assets and contract liabilities are presented below: | | Receivables | | Contract
Assets | | Contract
Liabilities | | |----------------------------|-------------|---------|--------------------|--|-------------------------|--| | Balance, January 1, 2023 | \$ | 760,647 | \$ | | \$ | | | Balance, December 31, 2023 | \$ | 188,289 | \$ | | \$ | | ### **Significant Judgement** Revenue from contracts with customers includes commission income and fees from investment banking and asset management 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 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. ### **Credit Losses** The guidance under ASC Topic 326, *Financial Instruments* - *Credit losses* ("ASC 326"). ASC 326 impacts the impairment model for certain financial assets by requiring a current expected credit loss ("CECL") methodology to estimate expected credit losses over the entire life of the financial asset. Under the guidance, the Company has the ability to determine that there are no expected credit losses in certain circumstances (e.g., based on the credit quality of the customer). The allowance for credit losses is based on the Company's expectation of the collectability of financial instruments, including fees and other receivables utilizing the CECL framework. The Company considers factors such as historical experience, credit quality, age of balances and current and future economic conditions that may affect the Company's expectation of collectability in determining the allowance for credit losses. The Company's expectation is that the credit risk associated with fees and other receivables is not significant and accordingly, the Company has not provided an allowance for credit losses at December 31, 2023. {8}------------------------------------------------ ### **Notes to Financial Statements December 31 , 2023** ### **2. Summary of Significant Accounting Policies (continued)** #### **Income Taxes** The Company is a single member limited liability company for income tax purposes. As such, the Company is a disregarded entity for tax purposes and does not record a provision for income taxes. The Company is not required to file a separate Federal tax return. The Company is required to tile the LLC information return in Puerto Rico and has paid tax withholding on behalf of the member, which is treated as distribution to the member. The Company is also liable for local municipal tax. As of December 31, 2023, management has determined that the Company has no uncertain tax positions that would require financial statement recognition. The determination will always be subject to ongoing reevaluation as facts and circumstances may require. #### **3. Regulatory Requirements** The Company is subject to SEC Uniform Net Capital Rule I 5c3- I under the Securities Exchange Act of 1934, 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 I. At December 31 , 2023, the Company had net capital of\$ l 16,874 which exceeded the minimum required net capital by \$1 l 1,874. The Company does not handle cash or securities on behalf of customers. Therefore, it is not affected by SEC Rule 15c3-3. #### **4. Related Party Transactions** The Company maintains an Expense Sharing Agreement with its Parent. The Parent provides office space, accounting, administrative and other services to the Company. The Company does not have any obligation, direct or indirect, to reimburse or otherwise compensate its Parent for any or all shared costs paid on its behalf. These costs have not been recorded on the books of the Company. The terms of these arrangements may not be the same as those that would otherwise exist or result from agreements and transactions among unrelated parties. The General Securities Principal of the Company owns 80% of the Parent company. {9}------------------------------------------------ ### **Notes to Financial Statements December 31, 2023** ### **5. Concentrations** Approximately 83% of the total revenues for the year ended December 31, 2023, were earned from two customers. All cash deposits are held by one financial institution and therefore are subject to the credit risk at that financial institution. The Company has not experienced any losses in such accounts and does not believe there to be any significant credit risk with respect to these deposits. ### **6. Subsequent Events** The Company has evaluated events or transactions that may have occurred subsequent to December 31, 2023 and through the date the financial statements were issued and determined that there are no material events that would require disclosure in the Company's financial statements. Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.