# WEDBUSH & CO., LLC X-17A-5 (2024-08-29) — Broker-dealer annual report - Company: WEDBUSH & CO., LLC - Form: X-17A-5 - Filed: 2024-08-29 - Period: 2024-06-30 - Accession: 0001994264-24-000010 - CIK: 1994264 - File #: 8-71158 - Type: Broker-dealer - Material weakness: No - Auditor: Ernst & Young LLP - Auditor location: New York, NY - Contact: Samantha Kirkman - Phone: 212-931-7088 - Signed by: Samantha Kirkman (Chief Financial Officer) Original filing: https://www.sec.gov/Archives/edgar/data/1994264/000199426424000010/WedCo_FinCond_63024.pdf --- {0}------------------------------------------------ # **Wedbush & Co., LLC** Statement of Financial Condition and Report of Independent Registered Public Accounting Firm June 30, 2024 (SEC Identification No. 8-71158) {1}------------------------------------------------ UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 OMB APPROVAL OMB Number: Expires: Estimated average burden hours per response: SEC FILE NUMBER ## 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 \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ MM/DD/YY MM/DD/YY A. REGISTRANT IDENTIFICATION ## NAME OF FIRM: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ 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.) ## \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ | _____________________________________________________________________________________
(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) | | | (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. {2}------------------------------------------------ #### OATH OR AFFIRMATION | I, ___________________________________________, swear (or affirm) that, to the best of my knowledge and belief, the | | | | | |---------------------------------------------------------------------------------------------------------------------|--|--|--|--| | financial report pertaining to the firm of ____________________________________________________________, as of | | | | | | | | | | | \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_, 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. \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ Based upon the Commission staff statement "Updated Division of Trading and Markets Staff Statement Regarding Requirements for Certain Paper Submissions in Light of COVID-19 Concerns" (June 18, 2020) and difficulties arising from COVID-19, Wedbush Securities Inc. is making this filing without a notartization | Signature: | | | | |------------|--|--|--| |------------|--|--|--| \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ Title: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ 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}------------------------------------------------ ### **Wedbush & Co., LLC** Table of Contents |
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| 5 | {4}------------------------------------------------ ![](_page_4_Picture_0.jpeg) Ernst & Young LLP One Manhattan West New York, NY 10001 Tel: +1 212 773 3000 Fax: +1 212 773 6350 ey.com {5}------------------------------------------------ ### **Wedbush & Co., LLC** Statement of Financial Condition As of June 30, 2024 | Assets | | |---------------------------------------|-----------------| | Cash | \$1,598,786 | | Other receivables | 4,600 | | Other assets | 8,560 | | Total assets | \$1,611,946 | | Liabilities and member's equity | | | Payable to affiliates | \$119,357 | | Other liabilities | 315,574 | | Total liabilities | 434,931 | | Member's equity | | | Additional paidͲin capital | 1,000,000 | | Retained earnings | 177,015 | | Total member's equity | 1,177,015 | | Total liabilities and member's equity | \$
1,611,946 | See accompanying notes to the statement of financial condition {6}------------------------------------------------ ### **Wedbush & Co., LLC** Notes to the Statement of Financial Condition June 30, 2024 #### **(1) Organization** Wedbush & Co., LLC (the Company) is a Delaware limited liability company. The Company is a financial services company headquartered in New York, New York, that provides private placement services to institutional clients located in the United States of America. The Company is registered as a securities brokerͲdealer with the U.S. Securities and Exchange Commission (SEC). The Company's registration with the SEC was approved on January 25, 2024. The Company is a member of the Financial Industry Regulatory Authority (FINRA) and the Securities Investor Protection Corporation. The Company's direct parent and sole member is Wedbush Financial Services, LLC (WFS), a Delaware limited liability company. WFS is majority owned by Wedbush Capital (WedCap). #### **(2) Summary of Significant Accounting Policies** #### *(a) Basis of Presentation* The Company follows accounting principles generally accepted in the United States of America (U.S. GAAP), as established by the Financial Accounting Standards Board (FASB), to ensure consistent reporting of financial condition. The U.S. dollar is the functional currency of the Company. #### *(b) Use of Estimates* In preparing the Statement of Financial Condition, management is required to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the Statement of Financial Condition during the reported period*.* Although estimates and assumptions are based on the best available information, actual results could differ materially from these estimates. #### *(c) Cash* Cash is comprised of on demand deposits. Cash on deposit with financial institutions, may, at times, exceed federal insurance limits. #### *(d) Revenue Recognition* Revenues from private placements are recognized when the services related to the underlying transaction are completed under the terms of the engagement. Additional information regarding revenue recognition isincluded in Note 3 "Revenue from Contracts with Customers." #### *(e) Income Taxes* The Company computes tax provisions in accordance with ASC 740, *Income Taxes* (ASC 740), on a modified separate return method. Deferred tax assets and liabilities are recognized for temporary differences between the financial reporting and tax basis of the Company's assets and liabilities. Deferred taxes are adjusted to reflect the tax rates at which future taxable amounts will likely be settled or realized. The effects of tax rate changes on future deferred tax liabilities and deferred tax {7}------------------------------------------------ #### **Wedbush & Co., LLC** Notes to the Statement of Financial ConditionͲcontinued June 30, 2024 assets, as well as other changes in income tax laws, are recognized in the period during which such changes are enacted.The Company follows guidance under ASC 740, which sets out a consistent framework to determine the appropriate level of tax reserves to maintain for uncertain tax positions. Under ASC 740, the Company determines whether it is more likely than not that an income tax position will be sustained upon examination by tax authorities. ASC 740 prescribes a recognition threshold and a measurement attribute for the financialstatement recognition and measurement of tax positions taken or expected to be taken in a tax return. Sustainable income tax positions are measured to determine the amount of benefit to be recognized in the Statement of Financial Condition based on the largest amount of benefit that is more likely than not to be realized upon ultimate settlement. #### *(f) Recent Accounting Developments* #### **Improvements to Income Tax Disclosures** In December 2023, the FASB issued ASU 2023Ͳ09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The amendments in this update improve the transparency of income tax disclosures related to the rate reconciliation and income taxes paid by requiring (1) consistent categories and greater disaggregation of information in the rate reconciliation and (2) income taxes paid disaggregated by jurisdiction. The ASU is effective for annual periods beginning after December 15, 2024 with early adoption permitted. The Company is currently evaluating the impact of the new guidance but does not expect a material impact on its Statement of Financial Condition. #### **(3) Revenues from Contracts with Customers** The timing of revenue recognition may differ from the timing of payment by customers. The Company records a receivable when revenue is recognized prior to payment and the Company has an unconditional right to payment. Alternatively, when payment precedes the provision of the related services, the Company records deferred revenue until the performance obligations are satisfied. The Company had no receivables or deferred revenue outstanding related to revenues from contracts with customers at June 30, 2024. #### **(4) Income Taxes** The Company is included in the filing of WedCap's consolidated tax return for federal tax purposes and in WedCap's combined returns for certain states where such filing is required or permitted. The Company is also a party to a tax allocation agreement with WedCap. The Company has adopted the modified separate return approach, whereby the Company calculates its corresponding tax amounts in accordance with the current enacted tax laws and rates while also considering those tax attributes that are realized or realizable by WedCap and corresponding consolidated or combined group. The Company believes its adopted modified separate return approach is systematic and rational and has been consistently applied. The Company had no material unrecognized tax benefits. WedCap is no longer subject to U.S. federal examinations for the years before June 30, 2019, and, with a few exceptions, to state and local tax examinations for the years before June 30, 2019. {8}------------------------------------------------ ### **Wedbush & Co., LLC** ## Notes to the Statement of Financial ConditionͲcontinued June 30, 2024 Included in Payable to affiliates in the Statement of Financial Condition are federal and state tax payable to WFS of \$67,000 at June 30, 2024. The Company recognizes deferred tax assets and liabilities for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. As of June 30, 2024 the Company has no deferred tax assets or liabilities. #### **(5) Net Capital Requirement and other Regulatory Matters** The Company is subject to the SEC's Uniform Net Capital Rule 15c3Ͳ1, which requires the maintenance of minimum net capital. The Company is required to maintain minimum net capital equal to the greater of 12.5% of Aggregate Indebtedness, or \$5,000. At June 30, 2024, The Company had net capital of \$1.2 million that was 15% of aggregate indebtedness and \$1.1 million in excess of the required minimum net capital at that date. The Company does not claim an exemption under paragraph (k) of 17 C.F.R § 240.15c3Ͳ3. The Company does not carry securities accounts for customers or perform custodial functions related to customer securities. This allows the Company to file an exemption report under Footnote 74 to SEC Release 34Ͳ 70073. #### **(6) Contingencies** The Company may be subject to various proceedings and claims arising primarily from securities business activities, including lawsuits, arbitration claims and regulatory matters. The Company may be involved in other reviews, investigations, and proceedings by governmental bodies and selfͲregulatory organizations regarding its business, which may result in adverse judgments, settlements, fines, penalties, injunctions and other relief. The Company accruesfor a settlement when a liability is deemed probable and estimable in Other liabilities in the Statement of Financial Condition. At the present time, the Company has not recorded any loss contingencies on the Company's Statement of Financial Condition. #### **(7) RelatedͲParty Transactions** The Company has cost sharing agreements with affiliated company, Wedbush Securities, Inc. (WSI), related to shared resources such as employees, equipment, software and support services. Employees' compensation and benefits are allocated to the Company based on percentage of time worked for the Company. The Company remits monthly payment to WSI to cover the shared cost. At June 30, 2024, Payable to affilates in the Statement of Financial Condition included \$52,357 related to cost sharing agreements. At June 30, 2024, Other liabilities in the Statement of Financial Condition included \$257,040 related to compensation payable to shared employees. The Company has agreements with affiliates for other activities, including a tax sharing agreement with WedCap as described in Note 4 "Income Taxes." Unsettled amounts for these activities are recorded within Payable to affiliates in the Statement of Financial Condition. {9}------------------------------------------------ ### **Wedbush & Co., LLC** ### Notes to the Statement of Financial ConditionͲcontinued June 30, 2024 For the fiscal year ended June 30, 2024 the Company received \$500,000 capital contribution from WFS. #### **(8) Subsequent Events** The Company has evaluated all events subsequent to June 30, 2024, up until the date the Statement of Financial Condition was issued, and has determined there were no events or transactions during said period that would require recognition or disclosure in the Statement of Financial Condition. Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.