# KOPENTECH CAPITAL MARKETS LLC X-17A-5 (2022-03-22) — Broker-dealer annual report

- Company: KOPENTECH CAPITAL MARKETS LLC
- Form: X-17A-5
- Filed: 2022-03-22
- Period: 2021-12-31
- Accession: 0001772945-22-000004
- CIK: 1772945
- File #: 8-70331
- Type: Broker-dealer
- Material weakness: No
- Auditor: Citrin Cooperman & Company LLP
- Auditor location: New York, NY
- Contact: Andrew An
- Phone: 310 307 4806
- Email: drew.an@kopentech.com
- Website: kopentech.com
- Signed by: Andrew An (Chief Compliance Officer)

Original filing: https://www.sec.gov/Archives/edgar/data/1772945/000177294522000004/kcmpublic.pdf

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### **STATEMENT OF FINANCIAL CONDITION**

**DECEMBER 31, 2021**

**(With Report of Independent Registered Public Accounting Firm Thereon)**

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## **CALIFORNIA JURAT**

**A Notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validit orthat document** 

State of California County of *Lo~* A:~ *1~ks* 

Subscribed and sworn to (or affirmed) before me on this~ day of **af** *~rvlt* , 202J..

by \_\_ \_,\_A..;...Jno....:....=...d..i....;;r£NJ~ \_\_ A-'-~-=-----------------------'-' proved to me

on the basis of satisfactory evidence to be the person(s) who appeared before me.

| (Seal)                                                                                                                   |                                                                                                                  |
|--------------------------------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------------------------------|
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| Description of attached document:                                                                                        |                                                                                                                  |
| Title or Type of Document: Atrn,ual. R<f& &m<br>I 2--<br>,1-:S:ol-{<br>Document Date:<br>Signers other than named above: | r, Oath<br>t9\ A:ffitwa:h0n<br>x--111,<br>_______ _<br>Number of Pages: ______ z.<br>______________________<br>_ |
| c_apacity(ies) claim~¥ signe~<br>Signer's Name: ----1~~~d""'~  ~  ,C.11""/___.,~.,._,_,__                                | ____________________<br>_                                                                                        |
| Signer is Representing:                                                                                                  | _________________________<br>_                                                                                   |
| n lndividual(s)<br>,JZ'Corporate Officer-<br>Title(s):                                                                   | ______________________<br>_                                                                                      |
| L Partner(s) -<br>, Limited □ General                                                                                    |                                                                                                                  |
| ::J Attorney-in-Fact                                                                                                     |                                                                                                                  |
| □ Trustee(s)                                                                                                             |                                                                                                                  |
| LJ Guardian(s) or Conservator(s}                                                                                         |                                                                                                                  |
| Other:--------------------------------<br>C1                                                                             |                                                                                                                  |

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**UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington,** D.C. **20549** 

**0MB** APPRnv.1u 0MB Number: 3235·0123 Expires: Oct. 31, 2023 Estimated average burden hours per response: 12

## **ANNUAL REPORTS FORM X-17A-5 PART** Ill

| SEC FILE NUMBER |
|-----------------|
| 8-70331         |

**FACING PAGE** 

Information Required Pursuant to Rules 17a-5, 17a-12, and 18a-7 under the Securities Exchanse Act of 1934

| FILING FOR THE PERIOD BEGINNING _0_1_/0_1_/_2_0_2_1                                                                                     |                                                          | __   | __<br>AND ENDING _1_2_/3_1_/2_0_2_1        |  |
|-----------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------|------|--------------------------------------------|--|
|                                                                                                                                         | MM/00/YY                                                 |      | MM/DD/VY                                   |  |
|                                                                                                                                         | A. REGISTRANT IDENTIFICATION                             |      |                                            |  |
| __<br>NAME OF FIRM:                                                                                                                     | K_o_p_e_n_T_e_c_h_C_a_p_i_ta_l_M_a_r_k_e_ts_, _L_L_C     |      | ______<br>_                                |  |
| TYPE OF REGISTRANT (check all applicable boxes):<br>!!!I Broker-dealer<br>D Check here if respondent is also an OTC derivatil1es deafer | □ Security-based swap dealer                             |      | □ Major security-based swap participant    |  |
| ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use a P.O. box no.)                                                                     |                                                          |      |                                            |  |
| 10880 Wilshire Blvd, Suite 1101                                                                                                         |                                                          |      |                                            |  |
|                                                                                                                                         | (No. and Street)                                         |      |                                            |  |
| Los Angeles                                                                                                                             |                                                          | CA   | 90024                                      |  |
| (City)                                                                                                                                  | (State)                                                  |      | (Zip Code)                                 |  |
| PERSON TO CONTACT WITH REGARD TO THIS FILING                                                                                            |                                                          |      |                                            |  |
| Andrew An                                                                                                                               | 31 0-307 -4806                                           |      | drew.an@kopentech.com                      |  |
| (Name)                                                                                                                                  | (Area Code -Telephone Number)                            |      | (Email Address)                            |  |
|                                                                                                                                         | 8. ACCOUNTANT IDENTIFICATION                             |      |                                            |  |
| INDEPENDENT PUBLIC ACCOUNTANT whose reports are contained in this filing*                                                               |                                                          |      |                                            |  |
| Citrin Cooperman & Company, LLP                                                                                                         |                                                          |      |                                            |  |
|                                                                                                                                         | (Name -ifindivldual, state last, first, and middle name) |      |                                            |  |
| 50 Rockefeller Plaza                                                                                                                    | New York                                                 |      | 10020<br>NY                                |  |
| (Address)                                                                                                                               | (City)                                                   |      | (State)<br>(Zip Code)                      |  |
| 11/2/2005                                                                                                                               |                                                          | 2468 |                                            |  |
| (Date of Registration with PCAOB)(if applicable)                                                                                        |                                                          |      | (PCAOB Registration Number, 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 collKtion of information contained in this fonn are not required to respond unless the form displays a currently valld 0MB control number.

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#### **OATH OR AFFIRMATION**

I, Andrew An swear (or affirm) that, to the best of my knowledge and belief, the financial report pertaining to the firm of *,Kop,,,.,-1-ec.J,. C,s:.p/-h:.I* /'1p,,..t<-I *s* I *LL C-* , as of Decembe( 31 2~ 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.

Notary P

#### **This filing\*\* contains (check all applicable boices):**

- ~ (a) Statement offinancial condition.
- ~ (b) Notes to consolidated 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 cash flows.
- D (e) Statement of changes in stockholders' or partners' or sole proprietor's equity.
- D (f) Statement of changes in liabilities subordinated to claims of creditors.
- D (g) Notes to consolidated financial statements.
- n (h) Computation of net capital under 17 CFR 240.1Sc3-1 or 17 CFR 240.l&a-1, as applicable.
- 0 (i) Computation of tangible net worth under 17 CFR 240.lBa-2.
- D U) 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 240.15c3-3 or Exhibit A to 17 CFR 240.18a-4, as applicable.
- □ (I) Computation for Determination of PAB Requirements under Exhibit A to§ 240.15c3-3.
- □ (m) Information relating to possession or control requirements for customers under 17 CFR 240.15c3-3.
- □ (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 240.1Sc3-1, 17 CFR 240.18a-l, or 17 CFR 240.18a-2, as applicable, and the reserve requirements under 17 CFR 240.1Sc3•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 ln the statement of financial condition.
- Iii (q) Oath or affirmation in accordance with 17 CFR 240.l 7a-5, 17 CFR 240.17a-12, or 17 CFR 240.18a-7, as applicable.
- □ (r) Compliance report in accordance with 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable.
- □ (s) Exemption report in accordance with 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable.
- Iii (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 240.17a-5, 17 CFR 240.18a-7, or 17 CFR 240.17a-12, as applicable.
- D (v} Independent public accountant's report based on an examination of certain statements in the compliance report under 17 CFR 240.17a-S 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 240.17a-5 or 17 CFR 240.18a-7, as applicable.
- D (x) Supplemental reports on applying agreed-upon procedures, in accordance with 17 CFR 240.15c3-le or 17 CFR 240,l 7a-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 240.17a-12(k). <sup>D</sup>(z) Other: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ \_
- 
- ••ro request confidential treatment of certain portions of this filing, see 17 CFR 240.17a-5(e)(3) or 17 CFR 240.l8a-7(d)(2), as applicable.

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#### **DECEMBER 31, 2021**

#### **TABLE OF CONTENTS**

|                                                                                            | Page |
|--------------------------------------------------------------------------------------------|------|
| Independent<br>Registered<br>Public<br>Accounting<br>Firm……………………………………………….1<br>Report of |      |
| Financial<br>Statement<br><br><br><br><br><br><br><br><br>                                 |      |
| Statement of Financial Condition  2                                                        |      |
| Notes to the Financial Statement  3-5                                                      |      |

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![](_page_5_Picture_0.jpeg)

Citrin Cooperman & Company, **LLP**  Certified Public Accountants

50 Rockefeller Plaza New York, NY 10020 **T** 212.697.1000 **F** 212.697.1004 citrincooperman.com

#### **REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**

To the Member KopenTech Capital Markets, LLC

#### **Opinion on the Financial Statement**

We have audited the accompanying statement of financial condition of KopenTech Capital Markets, LLC 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 KopenTech Capital Markets, LLC 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 responsibility of KopenTech Capital Markets, LLC's management. Our responsibility is to express an opinion on KopenTech Capital Markets, LLC'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 KopenTech Capital Markets, 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 KopenTech Capital Markets, LLC's auditor since 2020. New York, New York March 21, 2022

<sup>&</sup>quot;Citrin Cooperman" is the brand under which Citrin Cooperman & Company, LLP, a licensed independent CPA firm, and Citrin Cooperman Advisors *TLC* serve clients' business needs. The two firms operate as separate legal 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).

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#### **STATEMENT OF FINANCIAL CONDITION DECEMBER 31, 2021**

#### **ASSETS**

| Cash and cash equivalents<br>Prepaid expenses        | \$<br>66,776<br>14,358 |
|------------------------------------------------------|------------------------|
| Total<br>assets                                      | \$<br>81,134           |
| LIABILITIES<br>AND<br>MEMBER'S<br>EQUITY             |                        |
| Liabilities:<br>Accounts payable<br>Due to affiliate | \$<br>24,600<br>2,894  |
| Total<br>liabilities                                 | 27,494                 |
| Member's equity                                      | 53,640                 |
| Total<br>liabilities<br>and<br>member's<br>equity    | \$<br>81,134           |

The accompanying notes are an integral part of the financial statement.

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#### **NOTES TO THE FINANCIAL STATEMENT DECEMBER 31, 2021**

#### **1. ORGANIZATION AND DESCRIPTION OF BUSINESS**

KopenTech Capital Markets, LLC (the "Company") is wholly-owned by KopenTech, LLC (the "Member"). The Company is a registered broker-dealer under the Securities Exchange Act of 1934 and is a member of both the Financial Industry Regulatory Authority ("FINRA") and the Securities Investors Protection Corporation ("SIPC") since December 11, 2019. The operating agreement provides for the limited liability company to exist in perpetuity. The Member's limit on liability is based on the relevant state law. The Company operates an alternative trading system, for subscribers interested in structured product investing.

#### **2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**

#### *Basis of presentation*

The accompanying financial statement of the Company has been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP").

#### *Use of estimates*

The preparation of the statement of financial condition in conformity with U.S. 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 statement. Actual results could differ from those estimates.

#### *Accounts receivable*

Accounts receivable are reported net of an allowance for expected credit losses. The allowance is based on management's estimate of the amount of receivables that will actually be collected. Management determined that at December 31, 2021, an allowance for expected credit losses was not necessary.

The beginning and ending receivable balances were as follows:

|                 | December 31 |      |      |       |
|-----------------|-------------|------|------|-------|
|                 |             | 2021 | 2020 |       |
| Fees receivable | \$          | -    | \$   | 8,750 |

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#### **NOTES TO THE FINANCIAL STATEMENT DECEMBER 31, 2021**

#### **2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** *(continued)*

#### *Uncertain tax positions*

The Company applies the provisions of FASB Accounting Standards Codification ("ASC") 740, "Income Taxes", as they relate to uncertain tax positions. The Company was not required to recognize any amounts from uncertain tax positions as of December 31, 2021.

The Company's conclusions regarding uncertain tax positions may be subject to review and adjustment at a later date based upon ongoing analyses of tax laws, regulations and interpretations thereof as well as other factors. In the event that tax authorities assess interest and penalties on unrecognized tax benefits, the Company will reflect such amounts in tax expense and income taxes payable.

#### *Financial instruments – credit losses*

In accordance with FASB ASU No. 2016-13, "Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments," the ASU adds to U.S. GAAP an impairment model (known as the current expected credit loss ("CECL") model) that is based on expected losses rather than incurred losses. The Company must recognize as an allowance, its estimate of lifetime expected credit losses, which the FASB believes will result in more timely recognition of such losses, if any. A broker-dealer's estimate of expected 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. For financial assets measured at amortized cost (i.e., cash), the Company has concluded that there are no expected credit losses based on the nature or expected life of the financial assets and immaterial historic or expected losses.

#### **3. CONCENTRATION OF CREDIT RISK**

The Company's cash deposits are held by one financial institution and therefore, are subject to credit risk to the extent those balances exceeded the Federal Deposit Insurance Corporation insurance limit of \$250,000. The Company has not experienced any losses in such accounts and does not believe it is exposed to any significant credit risk on cash.

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#### **NOTES TO THE FINANCIAL STATEMENT DECEMBER 31, 2021**

#### **4. RELATED PARTY TRANSACTIONS**

Pursuant to an expense sharing agreement, the Company reimburses the Member for allocated salaries, rent and communication expenses paid for by the Member. These charges are updated periodically, and determined based on percentages of personnel time and other factors. As of December 31, 2021, there was \$2,894 due to the Member.

In addition, to ease the burden on subscribers, the Company has agreed to collect all funds from subscribers and transfer any annual membership or acceptance fees to the Member. For the year ended December 31, 2021, the Company collected \$623,525 of such fees and as of December 31, 2021, the Company had no amounts which had not been transferred to the Member.

#### **5. NET CAPITAL REQUIREMENTS**

The Company is subject to the uniform net capital requirements of Rule 15c3-1 (The "Rule") of the Securities Exchange Act of 1934, as amended, which requires the Company to maintain, at all times, sufficient liquid assets to cover indebtedness. In accordance with the Rule, the Company is required to maintain defined minimum net capital of the greater of \$5,000 or 6 2/3% of aggregate indebtedness.

At December 31, 2021, the Company had net capital, as defined, of \$39,282, which exceeded the required minimum net capital of \$5,000 by \$34,282. Aggregate indebtedness at December 31, 2021, totaled \$27,494. The Company's percentage of aggregate indebtedness to net capital was 69.99%.

The Company does not claim an exemption from SEA Rule 15c3-3, in reliance on Footnote 74 to SEC Release No. 34-70073, and as discussed in Q&A 8 of the related FAQ issued by SEC staff. In order to avail itself of this option, the Company has represented that it does not, and will not, hold customer funds or securities, and that its business activities are, and will remain, limited to operating an alternative trading system.

#### **6. SUBSEQUENT EVENTS**

Management of the Company has evaluated events and transactions that have occurred through March 21, 2022, the date this financial statement was issued and determined that there are no material events that would require disclosures in the Company's financial statement.


Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.