# PARALEL DISTRIBUTORS LLC X-17A-5 (2024-03-27) — Broker-dealer annual report
- Company: PARALEL DISTRIBUTORS LLC
- Form: X-17A-5
- Filed: 2024-03-27
- Period: 2023-12-31
- Accession: 0001877227-24-000002
- CIK: 1877227
- File #: 8-70771
- Type: Broker-dealer
- Material weakness: No
- Auditor: Forvis, LLP
- Auditor location: Springfield, MO
- Contact: Bradley Swenson
- Phone: 3033780364
- Signed by: Bradley Swenson (President)
Original filing: https://www.sec.gov/Archives/edgar/data/1877227/000187722724000002/Public-.pdf
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UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549
MM/DD/YY MM/DD/YY OMB APPROVAL OMB Number: Expires: Estimated average burden hours per response: SEC FILE NUMBER
# ANNUAL REPORTS FORM X-17A-5 PART III A. REGISTRANT IDENTIFICATION
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 \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
# NAME OF FIRM: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
| NAME OF FIRM: _______________________________________________________________________ | | | |
|---------------------------------------------------------------------------------------------------------------------------------|------------------------------------------------------------|---------------------------------------|--------------------------------------------|
| TYPE OF REGISTRANT (check all applicable boxes):
Broker-dealer
Check here if respondent is also an OTC derivatives dealer | Security-based swap dealer | Major security-based swap participant | |
| ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use a P.O. box no.) | | | |
| _____________________________________________________________________________________ | | | |
| | (No. and Street) | | |
| _____________________________________________________________________________________ | | | |
| (City) | (State) | | (Zip Code) |
| PERSON TO CONTACT WITH REGARD TO THIS FILING | | | |
| _____________________________________________________________________________________ | | | |
| (Name) | (Area Code – Telephone Number) | (Email Address) | |
| | B.
ACCOUNTANT IDENTIFICATION | | |
| INDEPENDENT PUBLIC ACCOUNTANT whose reports are contained in this filing* | | | |
| _____________________________________________________________________________________ | | | |
| | (Name – if individual, state last, first, and middle name) | | |
| _____________________________________________________________________________________ | | | |
| (Address) | (City) | (State) | (Zip Code) |
| _____________________________________________________________________________________ | | | |
| (Date of Registration with PCAOB)(if applicable) | FOR OFFICIAL USE ONLY | | (PCAOB Registration Number, if applicable) |
| | | | |
\* 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.
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| | swear (or affirm) that, to the best of my knowledge and belief, the
Bradley Swenson |
|---|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| | financial report pertaining to the firm of Paralel Distributors LLC
as o |
| | 12/31
2023 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 dassified solel
as that of a customen |
| | |
| | Signature: |
| | AUBRIEN KORIN DENINE WHITE |
| | NOTARY PUBLIC - STATE OF COLORADO
Title:
NOTARY ID 20234032875 |
| | President & CCO
MY COMMISSION EXPIRES AUG 25, 2027 |
| | 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. |
| | [ |
| | Exhibit A to 17 CFR 240.18a-4, as applicable. |
| | (1) 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 |
| | 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-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 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 240.17-12, |
| | as applicable. |
| | [] (y) Report describing any material inadequacies 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). |
| 1 | (z) Other: |
| | |
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**Paralel Distributors LLC**
**Financial Statement As of and For the Year Ended December 31, 2023 Together with Report of Independent Public Accoun�ng Firm**
**This report is deemed PUBLIC in accordance with Rule 17a-5(e)(3) under the Securi�es Exchange Act of 1934.**
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### For the Year Ended December 31, 2023
### **Contents**
| Financial Statement | |
|--------------------------------------------------------|-------------|
| Report of Independent Registered Public Accoun�ng Firm | 1 |
| Statement of Financial Condi�on | 2 |
| Notes to Financial Statement | 3
-
6 |
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# **Report of Independent Registered Public Accounting Firm**
To the Member and Management Paralel Distributors LLC Denver, Colorado
### *Opinion on the Financial Statement*
We have audited the accompanying statement of financial condition of Paralel Distributors LLC (the "Company") as of December 31, 2023, including 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, 2023, in conformity with accounting principles generally accepted in the United States of America.
### *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 financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
We have served as the Company's auditor since 2022.
**Denver, Colorado March 13, 2024**
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# (A LIMITED LIABILITY COMPANY) Statement of Financial Condi�on As of December 31, 2023
| ASSETS | |
|---------------------------------------|---------------|
| Cash and cash equivalents | \$
433,931 |
| Accounts receivable | 82,988 |
| Prepaid expenses | 52,513 |
| TOTAL ASSETS | \$
569,432 |
| | |
| LIABILITIES AND MEMBER'S EQUITY | |
| LIABILITIES | |
| Accounts payable and accrued expenses | \$
132,770 |
| TOTAL LIABILITIES | 132,770 |
| MEMBER'S EQUITY | 436,662 |
| | |
| TOTAL LIABILITIES AND MEMBER'S EQUITY | \$
569,432 |
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(A LIMITED LIABILITY COMPANY) Notes to the Financial Statement For the Year Ended December 31, 2023
### **1. Organiza�on and Nature of Business**
Paralel Distributors LLC (the "Company") was formed on July 21, 2021, as a Colorado limited liability company and is a wholly owned subsidiary of Paralel Technologies LLC (the "Member"). The Company is a registered broker dealer, a member of the Financial Industry Regulatory Authority, Inc., a member of Na�onal Securi�es Clearing Corpora�on and a member of Securi�es Investor Protec�on Corpora�on.
The Company is exempt from the Securi�es Exchange Act of 1934 ("SEA") Rule 15c3-3 as a non-covered firm because its business ac�vi�es are limited to mutual fund distribu�on and mutual fund underwri�ng. As a result, the Company (1) did not directly or indirectly receive, hold, or otherwise owe funds or securi�es for or to customers, other than money or other considera�on received and promptly transmited in compliance with paragraph (a) or (b)(2) of SEA Rule 15c2-4; (2) did not carry accounts of or for customers; and (3) did not carry PAB accounts (as defined in SEA Rule 15c3-3) throughout the year ended December 31, 2023.
Due to the Company's business ac�vi�es, the Company is not subject to the custody and reserve provisions of SEA Rule 15c3-3.
# **2. Significant Accoun�ng Policies**
### *Basis of accounting*
The financial statement is prepared using the accrual basis of accoun�ng in accordance with accoun�ng principles generally accepted in the United States of America. Revenue is recognized when earned, while expenses and losses are recognized when incurred.
### *Use of estimates*
The prepara�on of the financial statement in conformity with accoun�ng principles generally accepted in the United States of America requires management to make es�mates and assump�ons that affect the reported amounts of assets and liabili�es and disclosure of con�ngent assets and liabili�es at the date of the financial statement and the reported amounts of revenues and expenses during the repor�ng period. Actual results could differ from those es�mates.
### *Cash and cash equivalents*
The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. Cash and cash equivalents consist of funds maintained in a checking account held at financial ins�tu�ons.
### *Income Taxes*
The Company is a single member which is treated as a disregarded en�ty for U.S. tax purposes and no provision for income taxes is recorded since the liability for such taxes is that of the Member rather than the Company. The Company's income tax returns are subject to examina�on by the federal and state taxing authori�es, and changes, if any, could adjust the individual income tax of the Member.
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### **Paralel Distributors LLC**
(A LIMITED LIABILITY COMPANY) Notes to the Financial Statement For the Year Ended December 31, 2023
### **3. Related Party Transac�ons**
During the year ended December 31, 2023, the Company had an expense sharing agreement in place with the Member. The agreement permits the alloca�on of certain shared expenses to the Company, and the balance due to the Member as of December 31, 2023, was \$515. The shared expenses consist of compensa�on, occupancy and other general overhead expenses incurred in the normal course of business.
The ac�vi�es of the Company include significant transac�ons with related par�es and may not necessarily be indica�ve of the condi�ons that would have existed if the company had operated as an unaffiliated business.
### **4. Net Capital Requirements**
The Company is subject to the SEA Rule 15c3-1, which requires the maintenance of minimum net capital and requires that the ra�o 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 resul�ng net capital ra�o would exceed 10 to 1). On December 31, 2023, the Company had net capital of \$301,161 which was \$292,310 in excess of its required net capital of \$8,851. The Company's ra�o of aggregate indebtedness to net capital was 44.09%.
### **5. Revenue and Expense Recogni�on**
### *Mutual fund underwriting*
Mutual fund underwri�ng revenue is derived from contracts whereby a mutual fund engages the Company to issue and sell through the Company, as sub placement agent, shares of the mutual fund. These fees are earned with the successful placement of an investment of the mutual fund and are earned throughout �me for as long as the investment remains in the mutual fund.
### *Distribution services income*
Distribu�on services income I derived from contracts whereby the mutual fund engages the Company to act as the distributor of the mutual fund. These fees are earned monthly and are for ongoing distribu�on services.
### *Reimbursed expenses*
The Company is reimbursed by the mutual funds it is engaged with, for certain expenses on a dollar-fordollar basis.
### *Receivables and contract balances*
Receivables arise when the Company has an uncondi�onal right to receive payment under a contract with a customer and are derecognized when the cash is received. The receivable balance as of December 31, 2023 and December 31, 2022, was \$82,988 and \$76,924, respec�vely.
Contract assets arise when the revenue associated with the contract is recognized prior to the Company's uncondi�onal right to receive payment under a contract with a customer (i.e., unbilled receivable) and are derecognized when either it becomes a receivable or the cash is received. Contract assets are reported in
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### **Paralel Distributors LLC**
# (A LIMITED LIABILITY COMPANY) Notes to the Financial Statement For the Year Ended December 31, 2023
the statement of financial condi�on. As of December 31, 2023 and December 31, 2022, the contract asset balances were \$0.
Contract liabili�es arise when customers remit contractual cash payments in advance of the Company sa�sfying its performance obliga�ons under the contract and are derecognized when the revenue associated with the contract is recognized when the performance obliga�on is sa�sfied. As of December 31, 2023 and December 31, 2022, the contract liabili�es balances were \$0.
### *Significant judgment*
Significant judgment is required to determine whether performance obliga�ons are sa�sfied at a point in �me or over �me; how to allocate transac�on prices where mul�ple performance obliga�ons are iden�fied; when to recognize revenue based on the appropriate measure of the Company's progress under the contract; and whether constraints on variable considera�on should be applied due to uncertain future events.
# **6. Concentra�ons of Credit Risk**
### *Cash*
The company maintains principally all cash balances in one financial ins�tu�on which at �mes may exceed the amount insured by the Federal Deposit Insurance Corpora�on. The exposure to the Company is solely dependent upon daily bank balances and the respec�ve strength of the financial ins�tu�on. The Company has not incurred any losses on this account. On December 31, 2023, the balance in excess of the insured amount of \$250,000 was \$183,931.
### **7. Indemnifica�ons**
In the normal course of its business, the Company indemnifies and guarantees certain service providers against specified poten�al losses in connec�on with their ac�ng as an agent of, or providing services to, the Company. The maximum poten�al amount of future payments that the Company could be required to make under these indemnifica�ons cannot be es�mated. However, the Company believes that it is unlikely it will have to make material payments under these arrangements and has not recorded any con�ngent liability in the financial statement for these indemnifica�ons.
The Company provides representa�ons and warran�es to counterpar�es in connec�on with a variety of commercial transac�ons and occasionally indemnifies them against poten�al losses caused by the breach of those representa�ons and warran�es. The Company may also provide standard indemnifica�ons to some counterpar�es to protect them in the event addi�onal taxes are owed or payments are withheld, due either to a change in or adverse applica�on of certain tax laws. These indemnifica�ons generally are standard contractual terms and are entered into in the normal course of business. The maximum poten�al amount of future payments that the Company could be required to make under these indemnifica�ons cannot be es�mated. However, the Company believes that it is unlikely it will have to make material payments under these arrangements and has not recorded any con�ngent liability in the financial statement for these indemnifica�ons.
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(A LIMITED LIABILITY COMPANY) Notes to the Financial Statement For the Year Ended December 31, 2023
### **8. Subsequent Events**
The Company has evaluated events and transac�ons that occurred from January 1, 2024, through March 13, 2024, for possible disclosure and recogni�on in the financial statement. Based upon this review, the Company has determined that there were no events which took place that would have material impact on the financial statement.
Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.