# PROMETHEUS FINANCIAL, LLC X-17A-5 (2023-03-31) — Broker-dealer annual report - Company: PROMETHEUS FINANCIAL, LLC - Form: X-17A-5 - Filed: 2023-03-31 - Period: 2022-12-31 - Accession: 0001853901-23-000002 - CIK: 1853901 - File #: 8-70691 - Type: Broker-dealer - Material weakness: No - Auditor: Ernst Wintter and Associates LLP - Auditor location: Walnut Creek, CA - Contact: Marieanne Jorajuria - Phone: 4152723317 - Email: marie@prometheusalts.com - Website: prometheusalts.com - Signed by: Marieanne Jorajuria (CCO) Original filing: https://www.sec.gov/Archives/edgar/data/1853901/000185390123000002/PrometheusAudiPUBLIC.pdf --- {0}------------------------------------------------ Prometheus Financial, LLC (SEC ID No. 8-70691) Annual Audit Report December 31, 2022 # PUBLIC DOCUMENT Filed Pursuant to Rule 17-A-5(e)(3) as a Public Document {1}------------------------------------------------ **UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549** OMB APPROVAL OMB Number: 3235-0123 Expires: Oct. 31, 2023 Estimated average burden hours per response: 12 SEC FILE NUMBER 8-70691 # **ANNUAL REPORTS FORM X-17A-5 PART III** **FACING PAGE** **Information Required Pursuant to Rules 17a-5, 17a-12, and 18a-7 under the Securities Exchange Act of 1934** FILING FOR THE PERIOD BEGINNING \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ AND ENDING \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ 12/31/2022 12/01/2021 MM/DD/YY MM/DD/YY **A. REGISTRANT IDENTIFICATION** #### NAME OF FIRM: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ Prometheus Financial, LLC TYPE OF REGISTRANT (check all applicable boxes): ☐ Broker-dealer ☐ Security-based swap dealer ☐ Major security-based swap participant ☐ Check here if respondent is also an OTC derivatives dealer ■ ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use a P.O. box no.) #### \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ 21255 Burbank Ave. | | (No. and Street) | | | | |--------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------|------------|--| | Woodland Hills | CA
_____________________________________________________________________________________ | | 91367 | | | (City) | (State) | | (Zip Code) | | | PERSON TO CONTACT WITH REGARD TO THIS FILING | | | | | | Marie Jorajuria | 415-272-3317
_____________________________________________________________________________________ | marie@prometheusalts.com | | | | (Name) | (Area Code – Telephone Number) | (Email Address) | | | | | B. ACCOUNTANT IDENTIFICATION | | | | | Ernst Wintter & Associates LLP | INDEPENDENT PUBLIC ACCOUNTANT whose reports are contained in this filing*
_____________________________________________________________________________________ | | | | | | (Name – if individual, state last, first, and middle name) | | | | | 675 Ygnacio Valley Road, Suite A200 | Walnut Creek
_____________________________________________________________________________________ | CA | 94596 | | | (Address) | (City) | (State) | (Zip Code) | | | 2/24/2009 | | 3438
_____________________________________________________________________________________ | | | | (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-5(e)(1)(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 OMB control number.** {2}------------------------------------------------ #### **OATH OR AFFIRMATION** | Marie Jorajuria | I, ___________________________________________, swear (or affirm) that, to the best of my knowledge and belief, the | | |-----------------|-----------------------------------------------------------------------------------------------------------------------------------|--| | financial | report pertaining to the firm of ____________________________________________________________, as of
Prometheus Financial, LLC | | | | | | \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_, 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. 12/31 022 ![](_page_2_Picture_3.jpeg) Title: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ CCO/FinOp Notarized online using audio-video communication Notary Public #### **This filing\*\* contains (check all applicable boxes):** - ☐ (a) Statement of financial 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. - ☐ (e) Statement of changes in stockholders' or partners' or sole proprietor's equity. - ☐ (f) Statement of changes in liabilities subordinated to claims of creditors. - ☐ (g) Notes to consolidated financial statements. - ☐ (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. - ☐ (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 240.15c3-3 or Exhibit A to 17 CFR 240.18a-4, as applicable. - ☐ (l) 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. - ☐ (o) Reconciliations, including appropriate explanations, of the FOCUS Report with computation of net capital or tangible net worth under 17 CFR 240.15c3-1, 17 CFR 240.18a-1, or 17 CFR 240.18a-2, as applicable, and the reserve requirements 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. - ☐ (p) Summary of financial data for subsidiaries not consolidated in the statement of financial condition. - ☐ (q) Oath or affirmation in accordance with 17 CFR 240.17a-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. - ☐ (t) Independent public accountant's report based on an examination of the statement of financial condition. - ☐ (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. - ☐ (v) Independent public accountant's report based on an examination of certain statements in the compliance report under 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable. - ☐ (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. - ☐ (x) Supplemental reports on applying agreed-upon procedures, in accordance with 17 CFR 240.15c3-1e 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 240.17a-12(k). - ☐ (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.* {3}------------------------------------------------ # Prometheus Financial, LLC ### Table of Contents | Report of Independent Registered Public Accounting Firm | 1 | |---------------------------------------------------------|-----| | Statement of Financial Condition | 2 | | Notes to Financial Statement | 3-6 | {4}------------------------------------------------ 675 Ygnacio Valley Road, Suite A200 (925) 933-2626 Walnut Creek, CA 94596 Fax (925) 944-6333 #### Report of Independent Registered Public Accounting Firm To the Member of Prometheus Financial, LLC #### Opinion on the Financial Statement We have audited the accompanying statement of financial condition of Prometheus Financial, LLC (the "Company") 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 Prometheus Financial, LLC as of December 31, 2022 in conformity with accounting principles generally accepted in the United States of America. #### Substantial Doubt about the Company's Ability to Continue as a Going Concern The accompanying financial statement has been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company incurred a net loss and depends on capital contributions from its member, which raises substantial doubt about its ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. #### 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 Prometheus Financial, LLC's auditor since 2022. Walnut Creek, California March 29, 2023 {5}------------------------------------------------ # Prometheus Financial, LLC ### Statement of Financial Condition ### December 31, 2022 | ASSETS | | |------------------------|---------------| | Cash | \$
113,879 | | Commissions receivable | 17,438 | | Prepaid expenses | 5,062 | | Total assets | \$
136,379 | ### LIABILITIES AND MEMBER'S EQUITY ### Liabilities | Commissions payable | \$
2,861 | |---------------------------------------|---------------| | Affiliate payable | 43,908 | | Total liabilities | 46,769 | | Total member's equity | 89,610 | | Total liabilities and member's equity | \$
136,379 | The accompanying notes are an integral part of this financial statement. {6}------------------------------------------------ #### 1. Organization Prometheus Financial, LLC (the "Company") was organized as a California limited liability company on March 16, 2021. The Company is owned by its sole member, Prometheus Alternative Investments, Inc. (the "Member"). The Company was formed as broker dealer to provide transactional services for private placements and mutual funds. The Company is a securities broker dealer registered with the Securities and Exchange Commission ("SEC") and the Financial Industry Regulatory Authority ("FINRA") as of December 1, 2021. For the period ending December 31, 2022, the Company, which is a start up broker dealer, incurred a net loss and negative cash flow from operating activities. The Company depends on contributions from the Member to continue operating for the next twelve months. #### 2. Significant Accounting Policies ### Basis of Presentation The financial statements have been prepared on the accrual basis in accordance with accounting principles generally accepted in the United States of America ("GAAP"). ### Use of Estimates GAAP may require management make estimates and assumptions that affect the reported amounts of 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 differ from those estimates and may have an impact on future periods. ### Fair Value of Financial Instruments Unless otherwise indicated, the fair values of all reported assets and liabilities that represent financial instruments approximate the carrying values of such amounts. The Company has no financial instruments that were required to be recorded at fair value on a recurring basis. #### Cash and Cash Equivalents The Company considers all demand deposits held in banks and certain highly liquid investments with original maturities of three months or less, other than those held for sale in the ordinary course of business, to be cash equivalents. There were no cash equivalents as of December 31, 2022. {7}------------------------------------------------ #### 2. Significant Accounting Policies (Continued) #### Accounts Receivable Accounts receivable represents amounts that have been earned and billed to clients in accordance with the Company's engagement letters with respective clients that have not yet been collected. The Company accounts for estimated credit losses on financial statements measured at an amortized cost basis and certain off-balance sheet credit exposures in accordance with FASB ACS 326-20, Financial Statements – Credit Losses. FASB ACS 326-20 requires the Company to estimate expected credit losses over the life of its financial assets and certain off-balance sheet exposures as of reporting date based on relevant information based on past events, current conditions, and reasonable and supportable forecasts. The Company records the estimate of credit losses as an allowance for credit losses. For financial assets measured at an amortized cost basis the allowance for credit losses is reported as a valuation account on the Statement of Financial Condition that is deducted from the asset's amortized cost basis. Changes for the allowance in credit losses are reported as credit losses on the Statement of Income. Per management's analysis, no allowance for credit losses was necessary as of December 31, 2022. ### Income Taxes The Company is a single member limited liability company, and is treated as a disregarded entity for tax purposes. In lieu of income taxes, the Company passes 100% of its taxable income and expenses to its Member. Therefore, no provision of liability for federal or state income taxes is included in these financial statements. The Company is however, subject to the California limited liability company tax of \$800 and a California company liability company fee based on gross revenue. All tax returns filed are open to examination by the tax authorities. The Company does not believe it has uncertain tax positions. #### 3. Revenue from Contracts with Customers Revenue from contracts with customers is recognized when, or as, the Company satisfies performance obligations by transferring the promised services to the customers. A service is transferred to a customer when, or as, the customer obtains control of that good or service. A performance obligation may be satisfied over time or at a point in time. Revenue from a performance obligation satisfied over time is recognized by measuring progress in satisfying the performance obligation in a manner that depicts the transfer of the goods or services to the customer. Revenue from a performance obligation satisfied at a point in time is recognized at the point in time when it is determined the customer obtains control over the promised good or service. The amount of revenue recognized reflects the consideration the Company expects to be entitled to in exchange for those promised goods or services (i.e., the "transaction price"). In determining the transaction price, the Company considers multiple factors, including the effects of variable consideration. Variable consideration is included in the transaction price only to the extent it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur and when the uncertainties with respect to the amount are resolved. In determining when to include variable consideration in the transaction price, the Company considers the range of possible outcomes, the predictive value of past experiences, the time period of when uncertainties expect to be resolved and the amount of consideration that is susceptible to factors outside of the Company's influence, such as market volatility or the judgment and actions of third parties. {8}------------------------------------------------ #### 3. Revenue from Contracts with Customers (Continued) The Company earns commissionsfees the placement of investors into alternative investments funds(private placement). Commissions are calculated as a percentage of investor funds placed with a fund. The performance obligation is deemed fulfilled as of the underlying funds have been invested into a fund. The Company's commission, for private placements that are placed into private funds, is generally 10% of quarterly management fees earned by investment managers and an annual performance fee of 10% of investor assets. The fees are considered variable as they are collected as long as the investor assets are invested in the fund. ### Contract Balances Income is recognized upon completion of the related performance obligation and when an unconditional right to payment exists. The timing of revenue recognition may differ from the timing of customer payments. Typically, the Company receives payment from the customer in the month following the private placement. Therefore, a receivable is recognized since the performance obligation is met prior to receiving payment from the customer. Receivables related to revenue from contracts with customers totaled \$0 and \$17,438 as of December 1, 2021 and December 31 2022, respectively. There was no deferred revenue at December 1, 2021 and December 31, 2022. The Company does not incur any expenses to obtain or fulfill contracts with customers. #### 4. Related Party Transactions The Company has an Expense Sharing Agreement with the Member. The Company agreed to reimburse the Member for its share of these costs. Cost allocations are mostly for payroll, As of December 31, 2022, \$43,908 was owed to the Member. The Company's results of operations and financial position could differ significantly from those that would have been obtained if the entities were autonomous. \$100,000 was forgiven in 2022. #### 5. Net Capital Requirements The Company is subject to the SEC's uniform net capital rule (Rule 15c3-I) which requires the Company to maintain a minimum net capital equal to or greater than \$5,000 and a ratio of aggregate indebtedness to net capital not exceeding 8 to 1 during its first year and 15 to 1 thereafter, both as defined. At December 31, 2022, the Company's net capital was \$67,110, which exceeded the requirement by \$62,110. ### 6. Risk Concentration Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of cash. For the year ended December 31, 2022, the Company maintains cash balances which, at times, may exceed federally insured limits. The Company has not experienced any losses on its cash deposits. As of December 31, 2022, 99% of commissions receivable was due from two customers, which was subsequently collected as of the date of this report. {9}------------------------------------------------ #### 7. Subsequent Events The Company's management has evaluated subsequent events through March 29, 2023, the date which the financial statements were issued. Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.