# HERALD INVESTMENT MARKETING, LLC X-17A-5 (2021-02-25) — Broker-dealer annual report - Company: HERALD INVESTMENT MARKETING, LLC - Form: X-17A-5 - Filed: 2021-02-25 - Period: 2020-12-31 - Accession: 0001686268-21-000004 - CIK: 1686268 - File #: 8-69854 - Material weakness: No - Auditor: Sanville & Company - Auditor location: Abington, PA - Contact: Patrick Chism - Phone: 484-840-3711 - Signed by: Patrick Chism (CEO) Original filing: https://www.sec.gov/Archives/edgar/data/1686268/000168626821000004/Public1.pdf --- {0}------------------------------------------------ UNITEDSTATES 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 | |-----------------| | 8-69854 | 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 | 01/01/2020 | AND ENDING | 12/31/2020 | | |--------------------------------------------------------------------------|--------------------------------------------------------|-----------------------|--------------------------------|--| | | MM/DD/Y Y | | MM/DD/YY | | | | A. REGISTRANT IDENTIFICATION | | | | | NAME OF BROKER-DEALER: Herald Investment Marketing, LLC | | OFFICIAL USE ONLY | | | | ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use P.O. Box No.) | | FIRM I.D. No. | | | | Gateway Corporate Center, Suite 216, 223 Wilmington West Chester Pike | | | | | | | (No. and Street) | | | | | Chadds Ford | | Pennsylvania
19317 | | | | (City) | (State) | | (Zip Code) | | | NAME AND TELEPHONE NUMBER OF PERSON TO CONTACT IN REGARD TO THIS REPORT | | | | | | Patrick Chism | | | (484) 840-3711 | | | | | | (Area Code - Telephone Number) | | | | B. ACCOUNTANT IDENTIFICATION | | | | | INDEPENDENT PUBLIC ACCOUNTANT whose opinion is contained in this Report* | | | | | | Sanville & Company | | | | | | | (Name - if individual, state last, first, middle name) | | | | | 1514 Old York Road | Abington | PA | 19001 | | | (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 a the basis for the exemption. See Section 240. 17-06/2/2 SEC 1410 (11-05) Potential persons who are to respond to the collection of . Scontain porcent who are to Tespond TO The Contection of information contained in this form are not required to respond unless the form displays a currently valid OMB contr {1}------------------------------------------------ # OATH OR AFFIRMATION | l. T allion Chism | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | |------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------| | Herald Investment Marketing, LLC | my knowledge and belief the accompanying financial statement and supporting schedules pertaining to the firm of | | of December 31 | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | | classified solely as that of a customer, except as follows: | neither the company nor any partner, principal officer or director has any proprietary interest in any account | | | | | | 1 | | | Signature | | | | | | | | | Commonwealth of Pennsylvania - Notary Seal
Title | | | Francis J McMahon, Notary Public | | Notary Public | Delaware County
My Commission Expires July 02, 2024
02/03/202 | | | Commission Number 1355225 | | This report ** contains (check all applicable boxes):
(a) Facing Page. | | | (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. | | | | (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. | | consolidation. | ] (k) A Reconciliation between the audited and unaudited Statements of Financial Condition with respect to methods of | | (1) An Oath or Affirmation. | | | (m) A copy of the SIPC Supplemental Report. | | | | (n) A report describing any material inadequacies found to have existed since the date of the previous audit. | r = (x) = report describing any material madequations of this filing, see section 240 novembers. {{ (o) N/A \*\*For conditions of confidential treatment of certain portions of t {2}------------------------------------------------ **Herald Investment Marketing, LLC Financial Statement December 31, 2020** {3}------------------------------------------------ ## Herald Investment Marketing, LLC Table of Contents December 31, 2020 ## ANNUAL AUDITED FOCUS REPORT FACING PAGE ...................................................................................................................................... ### REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM ON THE FINANCIAL STATEMENT ................................................................................................................................................... ### FINANCIAL STATEMENT | Statement of Financial Condition | | |---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--| | Notes to Financial Statement
www.liiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii | | {4}------------------------------------------------ ROBERT F. SANVILLE, CPA MICHAEL T. BARANOWSKY, CPA *Sanville & Company* CERTIFIED PUBLIC ACCOUNTANTS JOHN P. TOWNSEND, CPA 1514 OLD YORK ROAD ABINGTON, PA 19001 (215) 884-8460 • (215) 884-8686 FAX MEMBERS OF AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS PENNSYLVANIA INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS 100 WALL STREET, 8th FLOOR NEW YORK, NY 10005 (212) 709-9512 ### **REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM** To the Member of Herald Investment Marketing, LLC #### **Opinion on the Financial Statement** We have audited the accompanying statement of financial condition of Herald Investment Marketing, LLC (the "Company") as of December 31, 2020, and the related notes (collectively referred to as the "financial statement"). In our opinion, the statement of financial condition presents fairly, in all material respects, the financial position of the Company 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 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 statement. 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 statement. We believe that our audit provides a reasonable basis for our opinion. We have served as the Company's auditor since 2017 Abington, Pennsylvania February 20, 2021 {5}------------------------------------------------ # **Herald Investment Marketing, LLC Statement of Financial Condition December 31, 2020** ### **Assets** | Cash and cash equivalents | \$
1,424,694 | |---------------------------------------|-----------------| | Prepaid expenses and other assets | 107,881 | | Accounts receivable | 21,269 | | Total assets | \$
1,553,844 | | Liabilities and Member's Equity | | | Liabilities | | | Deferred income | \$
9,167 | | Accounts payable and accrued expenses | 42,042 | | Due to affiliate | 78,057 | | Commissions and fees payable | 446,307 | | Total liabilities | \$
575,573 | | Member's Equity | 978,271 | | Total liabilities and member's equity | \$
1,553,844 | The accompanying notes are an integral part of this financial statement. {6}------------------------------------------------ ### **1. Organization** Herald Investment Marketing, LLC (the "Company") is a Pennsylvania limited liability company that is a registered broker dealer with the Securities and Exchange Commission ("SEC") and the Financial Industry Regulatory Authority ("FINRA"). The Company was approved by FINRA to operate as a registered broker dealer on May 15, 2017. The Company is wholly owned by Chadds Ford Investment Management, LLC. It has agreed to operate as a limited purpose broker dealer which will act as a principal underwriter for investment companies and exchange traded funds. The Company is directly affected by general economic and market conditions, including fluctuations in volume and price level of securities and changes in interest rates, which have an impact on the Company's liquidity. \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ ## **2. Summary of Significant Accounting Policies** ### *The following are the significant accounting policies followed by the Company:* *Revenue –* Under ASC 606, mutual fund commissions, service fees and distribution fees are recognized when earned and the performance obligation has been satisfied. *Income taxes –* The Company is a single member limited liability company and is considered to be a disregarded entity as defined in the Internal Revenue Code. Under this provision, the taxable income or loss is taxed directly to the member. Accordingly, the Company records no provision for federal income taxes. The Company recognizes and discloses uncertain tax positions in accordance with accounting principles generally accepted in the United States of America (GAAP). As of December 31, 2020, the Company did not have liability for unrecognized tax benefits. The Company is no longer subject to examination by federal and state taxing authorities prior to 2017. *Use of estimates –* The preparation of financial statements in conformity with U. S. generally accepted accounting principles 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 may differ from those estimates and assumptions. *Cash* – At times during the year, the Company's cash accounts which are held at one bank, exceeded the related amount of federal depository insurance. The Company has not experienced any loss in such accounts and believes that it is not exposed to any significant credit risk. *Subsequent events* - Management has evaluated the impact of all subsequent events through February 20, 2021 the date the financial statements were available to be issued and has determined that there were no subsequent events requiring disclosure in these financial statements. ### **3. Concentration of Credit Risk** The Company is engaged in brokerage and distribution activities in which counterparties are primarily mutual fund companies. In the event counterparties do not fulfill their obligations, the Company may be exposed to risk. The risk of default depends on the creditworthiness of the counterparty or issuer of the financial product. Under ASC 326, the Company has evaluated the creditworthiness of client counterparties and issuers of financial products and determined that credit risk is minimal, hence, no allowance for credit losses was established for the year ended December 31, 2020. {7}------------------------------------------------ ## **Herald Investment Marketing, LLC Notes to Financial Statement (continued) December 31, 2020** ### **4. Net Capital Requirements** The Company is a member of the FINRA and is subject to the SEC Uniform Net Capital Rule 15c3-1. This Rule 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 1. Net capital and the related net capital ratio may fluctuate on a daily basis. At December 31, 2020 the Company had net capital of \$849,121 which was \$810,749 in excess of its required net capital of \$38,372. The Company's net capital ratio was 0.68 to 1. \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.