# SAND CAPITAL LLC X-17A-5 (2023-02-27) — Broker-dealer annual report - Company: SAND CAPITAL LLC - Form: X-17A-5 - Filed: 2023-02-27 - Period: 2022-12-31 - Accession: 0001750362-23-000001 - CIK: 1750362 - File #: 8-70193 - Type: Broker-dealer - Material weakness: No - Auditor: Citrin Cooperman & Company LLP - Auditor location: New York, NY - Contact: Kathy Efrem - Phone: 212-897-1686 - Signed by: Patrick Sweeney (CEO) Original filing: https://www.sec.gov/Archives/edgar/data/1750362/000175036223000001/Sand22s.pdf --- {0}------------------------------------------------ # **Sand Capital LLC** (a wholly-owned subsidiary of Related Fund Management, LLC) Statement of Financial Condition Pursuant to Rule 17A-5 under the Securities Exchange Act of 1934 December 31, 2022 {1}------------------------------------------------ #### **UNITED STATES SECURITIES Al'JD EXCHANGE COMMISSION Washington, D.C.** 20549 # **ANNUAL REPORTS FORM X-17A-5 PART** III 0MB APPROVAL 0MB Number: 3235-0123 Expires: Oct. 31, 2023 Estimated average burden hours per response: 12 SEC FILE NUMER 8- 70193 **FACING PAGE** Information Required Pursuant to Rules 17a-S, 17a-12, and 18a-7 under the Securities Exchange Act of 1934 FILING FOR THE PERIOD BEGINNING **O 1/01 /22** MM/DD/YY AND ENDING **12/31 /22** MM/DD/YY **A. REGISTRANT IDENTIFICATION** NAME OF FIRM: \_\_ S\_a\_n\_d\_C\_a\_p\_ita\_l\_L\_L\_C \_\_\_\_\_\_\_\_\_\_\_\_ \_ TYPE OF REGISTRANT (check all applicable boxes): ~ Brokeradealer D Securityabased swap dealer D Major securityabased swap participant D Check here if respondent is also an OTC derivatives dealer ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use a P.O. box no.) # 30 Hudson Yards 83rd Floor | | (No. and Street) | | | |-------------------------------|----------------------------------------------|-----------------------------|--| | New York | NY | 10001 | | | (City) | (State) | (Zip Code) | | | | PERSON TO CONTACT WITH REGARD TO THIS FILING | | | | Kathy Efrem
(212) 897-1686 | | kefrem@integrated.so1utions | | | (Name) | (Area Code - Telephone Number) | (Email Address) | | | | B. ACCOUNTANT IDENTIFICATION | | | INDEPENDENT PUBLIC ACCOUNTANT whose reports are contained in this filing\* # Citrin Cooperman & Company LLP | (Name - if individual, state last, first, and middle name) | | | | | |------------------------------------------------------------|----------|-------------------------------------------|------------|--| | 50 Rockefeller Plaza | New York | NY | 10020 | | | (Address) | (City) | (State) | (Zip Code) | | | 11/2/05 | | 2468 | | | | (Date of Registration with PCAOB)(ifapplicable) | | (PCAOB Registration Number, ifapplicable) | | | #### **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. l 7a-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 tbe form displays a currently valid 0MB control number.** {2}------------------------------------------------ #### **AFFIRMATION** I, Patrick Sweeney , swear (or affirm) that, to the best of my knowledge and belief, the financial report pertaining to Sand Capital LLC as of 12/31/22 , 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 that of a customer. Signatiire C£V Title Notary Public ![](_page_2_Picture_8.jpeg) {3}------------------------------------------------ ## **This filing\*\* contains (check all applicable boxes):** - **CEI** (a) Statement of financial condition. - **CEI** (b) Notes to unconsolidated or consolidated statement of financial condition, as applicable. - D ( 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 § 2 10.1-02 of Regulation S-X). - **D** ( d) Statement of cash flows. - D (e) Statement of changes 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. - D (g) Notes to unconsolidated or consolidated financial statements,, as applicable. - D (h) Computation of net capital under 17 CFR 240. l 5c3-1 or 17 CFR 240.18a-l, as applicable. - **D** (i) Computation of tangible net worth under 17 CFR 240.l 8a-2. - **D** (j) 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 240.15c3- 3 or Exhibit A to 17 CFR 240.18a-4, as applicable. - D (1) Computation for Determination of PAB Requirements under Exhibit A to§ 240. I 5c3-3. - D (m) Information relating to possession or control requirements for customers under 17 CFR 240. l 5c3-3. - **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 capital or tangible net worth under 17 CFR 240. l 5c3-l , 17 CFR 240. l 8a-l, or 17 CFR 240. l 8a-2, as applicable, and the reserve requirements under 17 CFR 240. l 5c3-3 or 17 CFR 240.18a-4, as applicable, if material differences exist, or a statement that no material differences exist. - D (p) Summary of financial data for subsidiaries not consolidated in the statement of financial condition. - 0 (q) Oath or affirmation in accordance with 17 CFR 240.17a-5, 17 CFR 240.1 7a-l 2, or 17 CFR 240. l Sa-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 240.17a-5 or 17 CFR 240. I 8a-7, as applicable. - CEI (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 240.18a-7, or 17 CFR 240. I 7a-l 2, as applicable. - D (v) Independent public accountant's report based on an examination of certain statements in the compliance report under 17 CFR 240. l 7a-5 or 17 CFR 240.18a-7, as applicable. - D (w) Independent public accountant's report based on a review of the exemption report under 17 CFR 240. l 7a-5 or 17 CFR 240.18a-7, as applicable. - D (x) Supplemental reports on applying agreed-upon procedures, in accordance with 17 CFR 240. l 5c3-l e or 17 CFR 240. l 7a-l 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.l 7a-12(k). D (z) Other:------------------------------------- - *\*\*To request confidential treatment of certain portions of this filing, see 17 CFR 240.17a-5(e)(3) or 17 CFR 240.18a-7(d)(2), as applicable.* {4}------------------------------------------------ ![](_page_4_Picture_0.jpeg) **Citrin Cooperman** & **Company, LLP** Certified Public Accountants 50 Rockefeller Pla.:a 1 ew York, NY 10020 **T** 212.697.1000 **F** 212.697.1004 citrincooperman.com ## **REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM** To the Member and Management Sand Capital LLC #### **Opinion on the Financial Statement** We have audited the accompanying statement of financial condition of Sand Capital LLC as of December 31, 2022, 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 Sand Capital LLC as of December 31, 2022, in conformity with accounting principles generally accepted in the United States of America. ## **Basis for Opinion** This financial statement is the responsibility of Sand Capital LLC's management. Our responsibility is to express an opinion on Sand Capital LLC's 6nancia1 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 Sand Capital 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 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 Sand Capital LLC's auditor since 2020. New York, New York February 22, 2023 "Citrin Cooperman" is the brand under which Citrin Cooperman & Company, LLP, a licensed independent CPA firm, and Citrin Cooperman Advisors LLC serve clients' business needs.1be two fu:ms operate as separate lal entities in an alternative practice structure. Citrin Cooperman is an independent member of Moore North America, which is itself a regional member of Moore Global Network limited (MGNL). {5}------------------------------------------------ ## **Statement of Financial Condition December 31, 2022** | Assets
Cash
Prepaid expenses and other assets | 223,522
\$
4,231 | |---------------------------------------------------------------------------------------------------------------------------------------|----------------------------------| | Total assets | 227,753
\$ | | Liabilities and Membe
r's Equity
Liabilities:
Accounts payable and accrued expenses
Due to affiliate
Total liabilities | 12,500
\$
16,818
29,318 | | Member's equity | 198,435 | | Total liabilities and member's equity | 227,753
\$ | The accompanying notes are an integral part of this financial statement. {6}------------------------------------------------ # **Notes to Statement of Financial Condition December 31, 2022** #### **1. Nature of operations** Sand Capital LLC (the "Company") is a limited liability company formed under the laws of the state of Delaware. The Company is a wholly-owned subsidiary of Related fund Management, LLC (the "Parent"). The Company is a broker-dealer registered with the Securities and Exchange Commission (the "SEC") and a member of the Financial Industry Regulatory Authority ("FINRA"). The primary business of the Company is to act as a broker-dealer providing financial and strategic advice on mergers and acquisitions, divestitures, restructurings, financings, capital raising and other similar transactions. #### **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 Company recognizes 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 standard 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 uncertainty associated with the variable consideration is resolved. The Company has not recognized any revenue to date. #### Significant judgments: Revenue from contracts with customers may include success fees and advisory fees. The recognition and measurement of revenue are based on the assessment of individual contract terms. Significant judgment is required to determine whether perfonnance 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. {7}------------------------------------------------ # **Notes to Statement of Financial Condition December 31, 2022** #### **2. Summary of Significant Accounting Policies (continued)** #### **Revenue recognition (continued)** #### Success fees: The Company earns revenue by way of transaction success fees that are recognized at the point in time that performance under the arrangement is completed. The Company has determined that this date is the appropriate point in time to recognize revenue for success fees as the performance obligation has been satisfied, there are no significant actions which the Company needs to take subsequent to this date and the purchaser obtains the control and benefit of the proceeds at that point. Payment for revenue is due upon closing. #### Advisory fees: The Company provides advisory services on mergers and acquisitions, restructurings, capital raising and other strategic transactions. Revenue for advisory arrangements is recognized over the time 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. Payment for revenue is due upon invoicing. #### Contract assets and liabilities: Contract assets represent the Company's right to consideration in exchange for goods or services that the Company has transferred to a customer, excluding unconditional rights to consideration that are presented as receivables. Contract liabilities represent the Company's obligation to deliver products or provide data to customers in the future for which cash has already been received. #### **Cash** All cash deposits are held by one financial institution and therefore are subject to the credit risk at that financial institution and may at times exceed amounts insured by the Federal Deposit Insurance Corporation. 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. #### **Income taxes** The Company is a single member limited liability company and is therefore treated as a disregarded entity for 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, and state income taxes. Accordingly, the Company has not provided for federal state and local income taxes. At December 31, 2022, management has determined that the Company had no uncertain tax positions that would require financial statement recognition. This determination will be subject to ongoing reevaluation as facts and circumstances may require. Interest and penalties assessed, if any, are recorded as income tax expense. The Parent's federal and state income tax returns are generally open for examination for years subsequent to 2019. {8}------------------------------------------------ # **Notes to Statement of Financial Condition December 31, 2022** #### **2. Summary of significant accounting policies (continued)** #### **Allowance for Credit Losses** The Company follows ASC Topic 326, Financial Instruments - Credit Losses ("ASC 326"). ASC 326 impacts the impairment model for certain financial assets by requiring a cwTent expected credit loss ("CECL") methodo logy to estimate expected credit losses over the entire life of the financial asset. The Company did not have any accounts receivable impacted by the guidance. An allowance for credit losses may be based on the Company's expectation of the collectability of its receivables utilizing the CECL framework. The Company considers factors such as historical experience, cred it quality, age of balances and current and future economic conditions that may affect the Company's expectation of the collectability in determining the allowance for credit losses. #### **3. Transactions with related parties** The Parent provides to the Company payroll, pension, and employee benefit administrative services for the Company's associated persons and office and administrative services for the Company to operate its business pursuant to an administrative services agreement (the "Expense Sharing Agreement"). The Company incurred costs of \$4,800 to the Parent for these services and owes the Parent \$16,818 at December 31 , 2022. The Parent also pays for various expenses of the Company without seeking reimbursement. All transactions with related parties are settled in the normal course of business. The terms of any of these arrangements may not be the same as those that would otherwise exist or result from agreements and transactions among unrelated d parties. #### **4. Regulatory requirements** The Company is subject to SEC Uniform Net Capital Rule l 5c3-1 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 1. At December 31 , 2022, the Company had net capital of\$179,204 which exceeded the required net capital by \$174,204. The ratio of aggregate indebtedness to net capital, at December 31, 2022 was .16 to 1. The Company does not hold customers' cash or securities and, has no requirements under SEC Rule 15c3-3 and therefore does not claim an exemption under paragraph (k). #### **5. Subsequent events** Management of the Company has evaluated events or transactions that may have occurred since December 31, 2022 and determined that there are no material events that would require disclosure in the Company's financial statement. Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.