# CHEERS SECURITIES LLC X-17A-5 (2022-02-25) — Broker-dealer annual report - Company: CHEERS SECURITIES LLC - Form: X-17A-5 - Filed: 2022-02-25 - Period: 2021-12-31 - Accession: 0001742815-22-000002 - CIK: 1742815 - File #: 8-70136 - Type: Broker-dealer - Material weakness: No - Auditor: YSL & Associates - Auditor location: New York, NY - Contact: Yisong Chen - Phone: 917-288-0795 - Email: yisong@cheerssecurities.com - Website: cheerssecurities.com - Signed by: Yisong Chen (CEO) Original filing: https://www.sec.gov/Archives/edgar/data/1742815/000174281522000002/cheerspublic2.pdf --- {0}------------------------------------------------ Cheers Securities LLC Statement of Financial Condition December 31, 2021 ------ - --- --- {1}------------------------------------------------ | UNITED STATES | | | 0MB APPROVAL | | |-------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------|---------------------------------------------------------------------------------------------------------------------|--| | | SECURITIES AND EXCHANGE COMMISSION | | | | | | Washington, D.C.
20549 | | 3235-0123
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October 31, 2023
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hours per response | | | | ANNUAL AUDITED REPORT | | | | | | FORM X-17A-5 | | SEC FI LE NUMBER | | | | PART Ill | | 8-70136 | | | REPORT FOR THE PERIOD BEGINNING | Information Required Pursuant to Rules 17a-5, 17a-12, and lSa-7 under the Securities Exchange Act of 1934
01/01/2021 AND ENDING
MM/DD/YY
A. REGISTRANT IDENTIFICATION | 12/31/2021 | MM/DD/VY | | | NAME OF FIRM: Cheers Securities LLC. | | | | | | TYPE OF REGISTRANT (check all applicable boxes):
~Broker-dealer
55 River Drive South, APT. 1012 | Security-based swap dealer
□ Check here if respondent is also an OTC derivatives dealer
ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use P.O. Box No.) | Major security-based swap participant | | | | | (No. and Street) | | | | | Jersey City | NJ
(State) | | 07310
(Zip Code) | | | (City)
PERSON TO CONTACT WITH REGARD TO THIS FILING | | | | | | | 917-288-0795 | | Yisong@CheersSecurities.com | | | Yisong Chen
(Name} | (Area Code- Telephone Number) | | (Emai l Address) | | | | B. ACCOUNTANT IDENTIFICATION | | | | | | INDEPENDENT PUBLIC ACCOUNTANT whose opinion is contained in this Report* | | | | | YSL & Associates
(Name - if individual, state last, first, middle name) | | | | | | 11 Broadway, Suite 700 | New York | NY | 10004 | | | (Address) | (City) | (State) | (Zip Code) | | | 06/ 06/2006 | | | 2699
(PCAOB Registration Number, if applicable) | | | (Date of Registration with PCAOB)(if applicable) | | | | | | | FOR OFFICIAL USE ONLY | | | | \* Claims for exemption from the requirement that 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 240.17a-S(e)(l)(ii), if applicable. **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** I, Yisong Chen, swear (or affirm) that, to the best of my knowledge and belief, the financial report pertaining to the firm of Cheers Securities LLC, as of December 31, 2021, is true and correct. I further swear (or affirm) that neither the company nor any partner, officer, director, or equivalent person, as the case may be, has any proprietary interest in any account classified solely as th~t of a 5ustomer. ' - ~- ~ *V* **AROON S. DASS NOTARY PUBLIC OF NEW JERSEY COMMISSION# 2401160 MY COMMISSION EXPIRES 10{1/2025** #### **This filing\*\* contains (check all appl** - 181 (a) Stateme nt of financial co ndition. - 12:1 (b) Notes to consolidated statement of financial condition. - D(c) Statement of income (loss) or, if there is othe r comprehensive income in the period(s) presented, a statement of - comprehensive income (as defined in§ 210.1-02 o Regulation 5-X). - D (d) Sta tement of cash flows. - D(e) Statement of changes in stockholders' or partners' or sole proprietor's equity. - D(f) Statement of changes in liabi lities subordinated t o claims of creditors. - D (g) Notes to co nsolidated financial stateme nts . - D(h) Computation of net capital under 17 CFR 240.15c3-1 or 17 CFR 240.18a-1, as applicable. - □ (i) Computation of tangible net worth under 17 CFR 240.18a-2. - D(j) Computation for determination of customer reserve requirements pursuant to Exhibit A to 17 CFR 240.15c3-3. - □ (k) Computation for determination of security-based swap reserve requirements pursuant to Exhibit B to 17 CFR 240.15c3- 3or Exhibit A to 17 CFR 240.lSa-4, as applicable. - □ (I) Computation for De ermination of PAB Requirements under Exhibit A to§ 240. 15c3-3. - D(m) Information rela ting to possession or control requirements for customers under 17 CFR 240.15c3-3. - D (n) Information relating to possession or control requirements for security-based swap customers under 17 CFR 240.15c3- 3(p)(2) or 17 CFR 240.18a-4, as applicable. - D(o) Reconciliations, including appropriate explanations, of the FOCUS Report with computation of net capita lor tangible net worth under 17 CFR 240.15c3-l, 17 CFR 240.18a-1, or 17 CFR 240.18a-2, as applicable, and the reserve req uirements under 17 CFR 240.15c3-3 or 17 CFR 240.18a-4, as applicable, if material differences exist, or a statement that no material differences exist. - 0(p) Summa ry of financial data for subs idiaries not co nsolidated in the statement of financia l condition. - l8l (q) Oath or affirmation in accordance with 17 CFR 240.17a-5, 17 CFR 240.17a-12, or 17 CFR 240.18a-7, as appl icable. - 0(r) Compliance report in accordance with 17 CFR 240. 17a-5 or 17 CFR 240.18a-7, as applicable. - 1D (s) Exemption report in accordan ce with 17 CFR 240.17a-5 or 17 CFR 240.lSa-7, as appl icable. - f8l (t) Independent pu blic 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 17CFR 240.17a-5, 17 CFR 240.18a-7, or 17 CFR 240.17a-12, as applicable. - □ (v-) Independent public accounta nt's report based on an examination of certa in statements in the compliance report under 17CFR 240. l 7a-5 or· 17 CFR 240.18a-7, as applica ble. - D(w) Independent public accountant's report based on a revie wof the exemption report under 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applica ble. - 0 (x) Supplemental reports on applying agreed-upon procedures, in accordance with 17 CFR 240.15c3-le or 17 CFR 240.17a-12, as applicable. - □ (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. l 7a-12{k). - □ (z) Ot her: \*'To request confidential treatment of certain portions of t his filing, see 17 CFR 240.17a-S(e)(3) or 17 CFR 240.18a-7(d)(2), as applicable. {3}------------------------------------------------ # **Cheers Securities LLC Index** | | Page(s) | |----------------------------------------------------------|-------------------------------| | Report of Independent Registered Public Accounting Firm | ·•· ····· ·· ·· ···· 1 | | Financial Statements | | | Statement of Financial Condition 2 | | | Notes to Statement of Financial Condition 3-5 | | {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 FlRM** To the Member of Cheers Securities LLC # **Opinion on the Financial Statement** We have audited the accompanying statement of financial condition of Cheers Securities LLC (the '"Company") as of December 31 , 2021 , 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 , 2021 , in conformity with accounting principles generally accepted in the United States of America. #### **Basis for Opinion** This financial statement is the responsibi li ty of the Company 's management. Our responsibility is to express an opinion on the Company 's financia l 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 aud it 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 financ ial 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 financ ial 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 opi nion. We have served as Cheers Securities LLC's auditor since 2021. New York, NY Februaiy 24, 2022 {5}------------------------------------------------ # **Cheers Securities LLC Statement of Financial Condition As of December 31, 2021** | Assets
Cash
Other assets
Total assets | \$
331 ,1 99
2,471
\$
333,670 | |-----------------------------------------------------------------------------------------------|-------------------------------------------| | Liabilities and Member's Equity
Accounts payable and accrued expenses
Total liabilities | 4,000
4,000 | | Member's equity
Total Member's equity
Total liabilities and Member's equity | 329,670
\$
333,670 | The accompanying notes are an integral part of this financial statement. {6}------------------------------------------------ ## **1. Organization** Cheers Securities LLC (the "Company"), was incorporated in Delaware on June 9, 2017. On June 3, 2021 , the Company received approval to become a broker-dealer and as such is registered as a broker-dealer with the Securities and Exchange Commission ("SEC") and is a member of the Financial Industry Regulatory Authority Inc. ("FINRA") and the Securities Investor Protection Corporation ("SIPC"). The Company is an introducing broker-dealer and it clears all transactions on a fully-disclosed basis through its clearing firm and does not hold customer funds or securities. The company engages in the following types of business: - 1) Broker or dealer retailing corporate equity securities over-the-counter; - 2) Broker or dealer selling corporate debt securities; - 3) Non-exchange member arranging for transactions in listed securities by exchange member; - 4) Private placement of securities; - 5) Other The Firm offers on-line trading/ electronic trading; The Company operates under the provisions of Paragraph (k)(2)(ii) of Rule 15c3-3 of the SEC and, accordingly, is exempt from the remaining provisions of the Rule. The requirements of Paragraph (k)(2)(ii) provide that the Company clear all transactions on behalf of customers on a fully-disclosed basis with a clearing broker-dealer. The clearing broker-dealer carries all of the accounts of the customers and maintains and preserves all related books and records as are customarily kept by a clearing broker-dealer. ## **2. Summary of Significant Accounting Policies** ### **Basis of Presentation** The Company's financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("US GAAP"). ### **Cash and cash equivalents** The Company considers all demand and time deposits and all highly liquid investments with an original maturity of three months or less to be cash equivalents. ### **Use of Estimates** The preparation of the financial statements in conformity with US 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 vary from the estimates that were used. ## **Revenue Recognition** Effective January 1, 2019, the Company adopted Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") ASC Topic 606, Revenue from Contracts with Customers ("ASC Topic 606"). The new revenue recognition guidance 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. The adoption of this standard had no effect on the Company's financial statements. {7}------------------------------------------------ # **2. Summary of Significant Accounting Policies (continued)** #### **Income Taxes** The Company is a single member limited liability company, and is treated as a disregarded entity for federal income tax reporting purposes. The Internal Revenue Code ("IRC") provides that any income or loss is passed through to the ultimate beneficial individual member for federal , state and certain local income taxes. Accordingly, the Company has not provided for income taxes. The Company's sole member is subject to New York City Unincorporated Business Tax ("UBT"), but the Company is a disregarded entity for tax purposes. All revenue and expenses retain their character and pass directly to the Parent's income tax returns . Based on an analysis of the operations of the Broker Dealer there was no UBT tax provision required. At December 31 , 2021 , management has determined that the Company had no uncertain tax positions that would require financial statement recognition. This determination will always be subject to ongoing reevaluation as facts and circumstances may require. The Company's tax preparers reviewed the Company's tax position and the results from operations and as a result of this review, the Company has determined there were no uncertain tax positions. ### **3. Net Capital Requirements** As a registered broker-dealer, the Company is subject to the SEC Uniform Net Capital Rule ("Rule 15c3-1") of the Securities Exchange Act of 1934, which requires the maintenance of minimum net capital. Rule 15c3-1 requires that the Company must maintain minimum net capital, as defined, equal to the greater of \$5,000 or 12.5% aggregate indebtedness (\$4,000). At December 31 , 2021, net capital of \$327,199, exceeded the required net capital minimum of \$5,000 by \$322,199. The Company is required to maintain a ratio of aggregate indebtedness to net capital not to exceed 15 to 1, and its net capital ratio is 0.01 to 1. ## **4. Clearing broker and clearing expenses** The Company signed a clearing agreement with its clearing broker, Vision Financial Markets LLC, on a fully disclosed basis. Per the clearing agreement, the Company is responsible for minimum monthly payments for clearing expenses when the Company decides to commence trading. The Company had not commenced trading during current year. ### **5. Concentration of Credit Risk** Cash consists of cash in banks, primarily held at financial institutions which at times may exceed federally insured limits of \$250,000. The Company has not experienced any losses and does not believe there to be any significant credit risk with respect to these balances. At December 31 , 2021 , the Company's balances exceed the insured limit by approximately \$78,000. {8}------------------------------------------------ #### **6. Risks Regarding Commencement of the Business** The Company is currently in the process of expanding operations. Accordingly, the Company has generated operating losses since inception through the year ended December 31 , 2021. There are many risks related to commencing any new business including attracting and retaining new employees, creating an efficient operations platform, acceptance by the marketplace of the business created and its ability to generate profitable operations and positive cash flows. These risks create uncertainties regarding the Company's ability to continue as a going concern . While management plans to create a business in trading equities, futures contracts, options, and private placements, the Company presently does not have the capital to support the Company's operations and management believes that it will require additional funding from its Parent. While management believes in the viability of its strategy to expand and generate adequate sales volume, achieve profitable operations and positive cash flows , it will also be dependent upon the economic environment and trends in the industry. If the Company is unable to expand and generate adequate sales and achieve profitable operations, the Parent has agreed to provide the necessary continuing financial support to the Company. ### **7. Coronavirus** The outbreak of the novel coronavirus ("COVID-19") in many countries continues to adversely impact global commercial activity and has contributed to significant volatility in financial markets. The World Health Organization has declared COVID-19 a "Public Health Emergency of International Concern." The global impact of the outbreak continues to evolve, and as cases of the virus have continued to be identified, many countries have reacted by instituting quarantines and restrictions on travel. Such actions are creating disruption in global supply chains , and adversely impacting a number of industries. The pandemic could have a continued adverse impact on economic and market conditions and trigger a period of global economic slowdown. The rapid development and fluidity of this situation precludes any prediction as to the ultimate adverse impact of COVID-19. Nevertheless, COVID-19 could have a material impact on the Company's financial statements. ### **8. Subsequent Events** The Company has evaluated subsequent events through the date of issuance of these financial statements. Based on this evaluation, the Company has determined that no events have occurred that were to be recognized or disclosed to the financial statements. Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.