# DOEREN MAYHEW CAPITAL ADVISORS, LLC X-17A-5 (2023-12-28) — Broker-dealer annual report - Company: DOEREN MAYHEW CAPITAL ADVISORS, LLC - Form: X-17A-5 - Filed: 2023-12-28 - Period: 2023-09-30 - Accession: 0001703218-23-000002 - CIK: 1703218 - File #: 8-69931 - Type: Broker-dealer - Material weakness: No - Auditor: EisnerAmper, LLP - Auditor location: Baton Rouge, LA - Contact: Jennifer Mailhes - Phone: 713-860-0215 - Signed by: Jennifer Mailhes (CEO) Original filing: https://www.sec.gov/Archives/edgar/data/1703218/000170321823000002/2023_FS_Public_Filed.pdf --- {0}------------------------------------------------ STATEMENT OF FINANCIAL CONDITION SEPTEMBER 30, 2023 {1}------------------------------------------------ #### **TABLE OF CONTENTS** # **Page REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM** ...................... 1 **FINANCIAL STATEMENT** Statement of Financial Condition ........................................................................................................ 3 Notes to Statement of Financial Condition ......................................................................................... 4 {2}------------------------------------------------ ![](_page_2_Picture_0.jpeg) {3}------------------------------------------------ ### **SEPTEMBER 30, 2023 STATEMENT OF FINANCIAL CONDITION** | Assets | | |---------------------------------------|---------------| | Cash and cash equivalents | \$
636,880 | | Accounts receivable | 52,457 | | Operating right of use assets | 227,850 | | Prepaid expenses | 3,594 | | Total Assets | \$
920,781 | | Liabilities and Member's Equity | | | Liabilities: | | | Accounts payable and accrued expenses | \$
24,035 | | Operating lease liabilities | 227,850 | | Deferred revenue | 244,810 | | Total Liabilities | 496,695 | | Member's Equity | 424,086 | | Total Liabilities and Member's Equity | \$
920,781 | See accompanying notes to financial statements. {4}------------------------------------------------ ### **NOTES TO STATEMENT OF FINANCIAL CONDITION SEPTEMBER 30, 2023** #### **Note 1 - Organization and Nature of Business** Doeren Mayhew Capital Advisors, LLC (the "Company"), a limited liability company organized in Michigan, is a broker dealer registered with the Securities and Exchange Commission (SEC) and is a member of the Financial Industry Regulatory Authority, Inc. (FINRA). The Company commenced operations on April 9, 2017 upon obtaining its brokerdealer registration. The Company acts as an agent in merger and acquisition transactions as well as arranges debt and equity financing. The Company also provides general advisory services to corporate clients. The Company is 100% owned by DMCA Holdings, LLC. #### **Note 2 - Significant Accounting Policies** #### Use of Estimates The preparation of the statement of financial condition in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates. #### Cash and Cash Equivalents The Company maintains cash on deposit with one banking institution. At times, deposits may exceed the Federal Deposit Insurance Corporation (FDIC) coverage limits. #### Concentrations 97% of the Company's accounts receivable is owed from two customers at September 30, 2023. #### Leases The Company determines if an arrangement is a lease at inception. Right of use assets represents our right to use an underlying asset for the lease term and lease liabilities represent our obligations to make lease payments arising from the lease. Lease expense for lease payments is recognized on a straight-line basis over the term of the lease. #### Credit Losses on Financial Statements In June 2016, the FASB issued ASU No. 2016-13, "Financial Instruments – Credit Losses (Topic 326) – Measurement of Credit Losses on Financial Instruments", which amends the FASB's guidance on the impairment of financial instruments. The ASU adds to U.S. GAAP an impairment model ("current expected credit loss model" or "CECL"). Under this new guidance, an entity recognizes as an allowance its estimate of expected credit losses. Upon adoption of Topic 326 on October 1, 2022, the Company elected to use the practical expedient. The Company adopted this accounting update using the modified retrospective method of adoption which resulted in no adjustment to amortized cost or retained earnings {5}------------------------------------------------ ### **NOTES TO STATEMENT OF FINANCIAL CONDITION SEPTEMBER 30, 2023** #### **Note 2 - Significant Accounting Policies (Continued)** as of the effective date. The Company's adoption of this accounting update did not have a material impact on the Company's statement of financial condition. The Company accounts for estimated credit losses on financial assets measured at amortized cost basis in accordance with Financial Accounting Standards Board ("FASB"), Accounting Standard Codification ("ASC") Topic 326 that requires management's measurement of the current expected credit loss ("CECL") to be based on a broader range of reasonable and supportable information for lifetime credit loss estimates including historical experience, current conditions, and supportable forecasts. A broker-dealer's estimate of expected credit losses should consider the expected risk of credit loss even if that risk is remote, regardless of the method applied to estimate credit losses. A broker-dealer, however, is not required to measure expected credit losses on a financial asset (or group of financial assets) in which historical credit loss information adjusted for current conditions and reasonable and supportable forecasts results in an expectation that nonpayment of the amortized cost basis is remote. #### Accounts receivable Accounts receivable represents investment banking and merger and acquisition consulting fees receivable. In consideration of the historical loss rate of zero since inception for this asset class, while considering other current and future economic conditions, the Company assessed the risk of default from the customers to be virtually non-existent and considers any resultant allowance to be not material to the users of the state of financial condition. The Company will continue to evaluate the appropriateness of a credit loss allowance on these receivables as facts and circumstances may evolve. At September 30, 2023 and 2022, the accounts receivable amounted to \$52,457 and \$232,060, respectively. #### **Note 3 - Leases** The Company subleases office space in Houston, Texas and Troy, Michigan from a related party. The Houston, Texas sublease agreement terminates in June 2037. The Troy, Michigan sublease agreement terminates in June 2033. Both lease agreements include fixed lease payments through their maturity. Leases with an initial term of 12 months or less are not recorded on the balance sheet; the Company recognizes lease expense for these leases on a straight-line basis over the lease term. Most leases include an option to renew and the exercise of lease renewal options is at our sole discretion. The Company did not include the renewal options as part of the right of use assets and liabilities. > The Company records the operating lease right of use assets and lease liabilities based on the present value of the lease payments, discounted using the current commercial lending rate. {6}------------------------------------------------ ### **NOTES TO STATEMENT OF FINANCIAL CONDITION SEPTEMBER 30, 2023** #### **Note 3 - Leases (Continued)** The discount rate associated with the operating leases as of September 30, 2023 was 7.00% for the Troy, Michigan lease and 4.50% for the Houston, Texas lease. On September 30, 2023, the Company extended the lease for office space in Massachusetts from a third party with monthly lease payments in the amount of \$1,247. The lease expires on September 30, 2024. The term of this lease is less than 12 months and as a result the Company will not record a right of use asset or lease liability associated with the lease agreement. As of September 30, 2023, the future minimum lease payments under the current leases are as follows: | Years Ending
September 30, | Amount | | |---------------------------------------|---------------|--| | 2024 | \$
43,380 | | | 2025 | 28,416 | | | 2026 | 28,416 | | | 2027 | 28,416 | | | 2028 | 28,416 | | | Thereafter | 170,064 | | | | | | | Total Minimum Lease payments | \$
327,108 | | | Weighted-average remaining lease term | 10.85 Years | | #### **Note 4 - Legal Contingencies** The Company is not currently a defendant in litigation incidental to its investment banking business. The Company accounts for litigation losses in accordance with FASB Accounting Standards Codification Topic 450, "Contingencies" (ASC 450). Under ASC 450, loss contingency provisions are recorded for probable losses at management's best estimate of a loss, or when a best estimate cannot be made, a minimum loss contingency amount is recorded. These estimates are often initially developed substantially earlier than the ultimate loss is known, and the estimates are refined each accounting period as additional information becomes available. Accordingly, the initial amount estimated and recorded could be as low as zero. As information becomes known, the initial estimate may be increased, resulting in additional loss provisions. Also, a best estimate amount is changed to a lower amount when events result in an expectation of a more favorable outcome than previously estimated. {7}------------------------------------------------ ### **NOTES TO STATEMENT OF FINANCIAL CONDITION SEPTEMBER 30, 2023** #### **Note 5 - Related Parties** The Company also leases office space from related parties as disclosed in Note 3. The Company has \$227,850 outstanding in obligations to this related party as of September 30, 2023. #### **Note 6 - Net Capital Requirements** The Company is subject to the Securities and Exchange Commission's Uniform Net Capital Rule (SEC Rule 15c3-1), which requires the maintenance of minimum net capital and requires that ratio of aggregate indebtedness to net capital, both as defined, shall not exceed 15 to 1 (and the rule of the "applicable" exchange also provides that equity capital may not be withdrawn or cash dividends paid if the resulting net capital ratio would exceed 10 to 1). At September 30, 2023, the Company had net capital of \$368,035, which was \$363,035 in excess of its required net capital of \$5,000, and the Company's ratio of aggregate indebtedness to net capital was 0.065 to 1. **\* \* \*End of Notes \* \* \*** Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.