# CAPITAL DYNAMICS BROKER DEALER LLC X-17A-5 (2024-03-26) — Broker-dealer annual report - Company: CAPITAL DYNAMICS BROKER DEALER LLC - Form: X-17A-5 - Filed: 2024-03-26 - Period: 2023-12-31 - Accession: 0002013816-24-000004 - CIK: 1448770 - File #: 8-68071 - Type: Broker-dealer - Material weakness: No - Auditor: Mazars USA LLP - Auditor location: New York, NY - Contact: Monique Romero - Phone: 212-668-8700 - Email: mromero@acisecure.com - Website: acisecure.com - Signed by: Carlo Esannason (CCO) Original filing: https://www.sec.gov/Archives/edgar/data/1448770/000201381624000004/cdbdpublicaudit.pdf --- {0}------------------------------------------------ UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 OMB APPROVAL OMB Number: 3235-0123 Expires: Nov. 30, 2026 Estimated average burden hours per response: 12 | ANNUAL
REPORTS | | |-------------------|---------| | FORM
X-17A-5 | 8-68071 | | PART
Ill | | | SEC FILE NUMBER | |-----------------| | | FACING PAGE Information Required Pursuant t o Rules 17a-5, 17a-12, and 18a-7 under the Securities Exchange Act o f 1934 FILING FOR THE PERIOD BEGINNING 01/01/23 AND ENDING 12/31/23 MM/DD/YY MM/DD/YY A. REGISTRANT IDENTIFICATION name or rir: CAPITAL DYNAMICS BROKER DEALER LLC TYPE OF REGISTRANT (check all applicable boxes): f=} Broker-dealer C) Security-based swap dealer L ] Major security-based swap participant CO) Check here if respondent is also an OTC derivatives dealer ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use a P.O. box no.) # 444 Madison Avenue | (No. and Street) | | | | | | | |-----------------------------------------------------------------|----------------------------------------------------------------------------------------|-----------------|------------|--|--|--| | New
York | N Y | | 10022 | | | | | | | | | | | | | PERSON TO CONTACT WITH REGARD TO THIS FILING | | | | | | | | Monique
Romero
212-668-8700
?
mromero@acisecure.com | | | | | | | | (Name) | (Area Code ? Telephone Number) | (Email Address) | | | | | | B. ACCOUNTANT IDENTIFICATION | | | | | | | | Mazars
USA | INDEPENDENT PUBLIC ACCOUNTANT whose reports are contained in this filing*
LLP | | | | | | | 135
West
50th | (Name- i f
individual, state last, first, and middle name)
Street
New
York | N Y | 10020 | | | | | (Address)
/ 2
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3 | (City) | (State) | (Zip Code) | | | | | (Name- i f
135
West
50th | individual, state last, first, and middle name)
Street
New
York | N Y | 10020 | |--------------------------------------------------|--------------------------------------------------------------------------|---------|--------------------------------------------| | (Address)
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3 | (City) | (State) | (Zip Code) | | (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 o f an independent public accountant must be supported by a statement o f facts and circumstances relied on as the basis o f the exemption. See 17 CFR 240.17a-5(e}(1)(ii), if applicable. Persons who are t o respond t o the collection o f information contained i n this form are not required t o respond unless the form displays a currently valid OMB control number. {1}------------------------------------------------ ## OATH OR AFFIRMATION | | , Carlo Esannason
, swear (or affirm) that, t o the best of m y knowledge and belief, the
financial
report
pertaining t o
the
firm
of
CAPITAL DYNAMICS
BROKER DEALER LLC
as o f | | | | | | |-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--|--|--|--|--| | | 12/31
, 2023 _
is true and correct.
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 o f a customer. | | | | | | | | | | | | | | | | Signature: | | | | | | | | PETER J. CHO | | | | | | | | NOTARY PUBLIC, STATE OF NEWYORK
Title:
NO. 01CH6308766 | | | | | | | | ler
QUALIFIED IN WESTCHESTER COUNTY
C H
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Com
VAN HeOMicee | | | | | | | | MY COM
ISSION EXPIRES JULY 28, 2034 | | | | | | | | Public
%-d[-
30> | | | | | | | | This filing** contains (check all applicable boxes): | | | | | | | fm | (a) Statement o f financial condition. | | | | | | | QO | (b) Notes t o consolidated statement o f financial condition. | | | | | | | | O(c) Statement o f income (loss) or, if there is other comprehensive income in the period(s) presented, a statement o f | | | | | | | | comprehensive income (as defined in § 210.1-02 o f Regulation S-X). | | | | | | | O | (d) Statement o f cash flows. | | | | | | | C1 | (e) Statement o f changes in stockholders? or partners? or sole proprietor?s equity. | | | | | | | C1 | (f) Statement o f changes in liabilities subordinated to claims of creditors. | | | | | | | ml | (g) Notes t o consolidated financial statements. | | | | | | | DO | {h) Computation o f net capital under 17 CFR 240.15c3-1 or 17 CFR 240.18a-1, as applicable. | | | | | | | C) | (i) Computation o f tangible net worth under 17 CFR 240.18a-2. | | | | | | | OO | (j) Computation for determination o f customer reserve requirements pursuant t o Exhibit A t o 17 CFR 240.15c3-3. | | | | | | | CL] | (k) Computation for determination o f security-based swap reserve requirements pursuant t o Exhibit B t o 17 CFR 240.15c3-3 o r | | | | | | | [ J | Exhibit Ato 17 CFR 240.18a-4, as applicable.
(l} Computation for Determination o f PAB Requirements under Exhibit A t o § 240.15c3-3. | | | | | | | O | (m)
Information relating t o possession or control requirements for customers under 17 CFR 240.15c¢3-3. | | | | | | | (1 | (n) Information relating t o 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. | | | | | | | {1 | (0) Reconciliations, including appropriate explanations, o f the FOCUS Report with computation o f 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. | | | | | | | O | (p) Summary of financial data for subsidiaries not consolidated in the statement o f financial condition. | | | | | | | m | (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. | | | | | | | C1 | (r) Compliance report in accordance with 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable. | | | | | | | 1 | (s) Exemption report in accordance with 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable. | | | | | | | (1 | (t) Independent public accountant?s report based on an examination o f the statement o f financial condition. | | | | | | | (J | (u) Independent public accountant?s report based on an examination o f 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. | | | | | | | QO | (v) Independent public accountant?s report based on an examination o f certain statements in the compliance report under 17 | | | | | | | | CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable. | | | | | | C (w) independent public accountant?s report based on a review o f the exemption report under 17 CFR 240.17a-5 o r 17 CFR 240.18a-7, as applicable. e e eee e C eee - (x) Supplemental reports on applying agreed-upon procedures, in accordance with 17 CFR 240.15c3-1e or 17 CFR 240.17a-12, as applicable. - OD (y) Report describing any materia! inadequacies found to exist or found t o have existed since the date o f the previous audit, or a statement that no material inadequacies exist, under 17 CFR 240.17a-12(k). - O (z) Other: \*\*To request confidential treatment o f certain portions o f this filing, see 17 CFR 240.17a-5(e)(3) o r 17 CFR 240.18a-7(d){2), as applicable. {2}------------------------------------------------ ![](_page_2_Picture_0.jpeg) FINANCIAL STATEMENT AND INDEPENDENT AUDITORS' REPORT December 31, 2023 {3}------------------------------------------------ ## CONTENTS | Report of Independent Registered Public Accounting Firm | 1 | |---------------------------------------------------------|-------| | Financial Statement | | | Statement of Financial Condition | 2 | | Notes to the Financial Statement | 3 - 4 | {4}------------------------------------------------ ![](_page_4_Picture_0.jpeg) ## **Report of Independent Registered Public Accounting Firm** **To the Member of Capital Dynamics Broker Dealer LLC** ## **Opinion on the Financial Statement** We have audited the accompanying statement of financial condition of Capital Dynamics Broker Dealer LLC, (the "Company"), as of December 31, 2023, 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 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 presentation of the financial statement. We believe that our audit provides a reasonable basis for our opinion. We have served as the Company's auditor since 2015. New York, NY March 21, 2024 {5}------------------------------------------------ ## STATEMENT OF FINANCIAL CONDITION | December 31, 2023 | | |---------------------------------|---------------| | | | | ASSETS | | | Cash | \$
111,700 | | Receivable from Affiliate | 42,142 | | Prepayments | 41,882 | | | \$
195,724 | | LIABILITIES AND MEMBER'S EQUITY | | | Accrued expenses | \$
31,010 | | Total liabilities | 31,010 | | Member's equity | 164,714 | | | | | | \$
195,724 | {6}------------------------------------------------ ## NOTES TO THE FINANCIAL STATEMENT ## 1. Nature of business and summary of significant accounting policies #### Nature of Business Capital Dynamics Broker Dealer LLC (the "Company") is a wholly-owned subsidiary of Capital Dynamics US, Inc. ("Parent"), effective March 31, 2018. Prior to this date, the Company was a wholly-owned subsidiary of Capital Dynamics, Inc. ("CDI" or "Affiliate") which is now a wholly-owned subsidiary of Parent. The Company is engaged in serving as placement agent to private investment companies (solely those private investment companies sponsored by one or more of its affiliates). The Company does not maintain customer accounts, engage in proprietary trading, or serve as underwriter in public offerings. The Company commenced operations in August 2009. The Company is a registered broker-dealer with the Securities and Exchange Commission ("SEC") and is a member of the Financial Industry Regulatory Authority ("FINRA"). #### Basis of Preparation The financial statement has been prepared in conformity with accounting principles generally accepted in the United States of America ("GAAP"). ## Concentration of Credit Risk The Company maintains its cash in a single bank account at a federally insured banking institution. #### Revenue Recognition The Company earns revenue in accordance with the Private Placement Agent Agreement held with CDI, a related party under common ownership. Success fees are earned based on a percentage of (i) the amount invested on closing in the funds managed by CDI, (ii) the management fee received in respect to a subscription or (iii) the contractual value of a binding contract, provided that such fees amount to at least 105% of the related sales commissions expenses suffered and recharged by the Parent, pursuant to the Private Placement Agent Engagement with CDI. The success fee revenue is earned based on the contractual value of a binding contract, whereby the initial subscription will give rise to a success fee. The Company believes that the performance obligation is satisfied on the date of closing when the capital contribution is called for by CDI because that is when the underlying investment has been placed with the customer. The success fee revenue recognized is constrained to the amount that is not subject to reversal, since the success fee may be reduced by any customer who do not contribute capital in accordance with the requirements of the private investment companies sponsored by the Company's affiliates. In addition to success fees, the Company receives a monthly retainer fee as compensation for reasonable efforts to arrange for private placements for private investment companies sponsored by the Company's affiliates, or Offered Services as defined in the Private Placement Agent Agreement. Revenue is recognized over time for these services, in which the performance obligations are simultaneously provided by the Company and utilized by CDI. #### Income Taxes The Company is a single member limited liability company, and is treated as a disregarded entity for income tax reporting purposes. Accordingly, the Company has not provided for federal or state income taxes. Management has determined that the Company had no uncertain tax positions that would require financial statement recognition at December 31, 2023. This determination will always be subject to ongoing revaluation as facts and circumstances may require. The Company remains subject to U.S. federal and state income tax audits for all periods subsequent to 2019. {7}------------------------------------------------ ## NOTES TO THE FINANCIAL STATEMENT (CONTINUED) ## 1. Nature of business and summary of significant accounting policies (continued) #### Use of Estimates The preparation of the financial statement in conformity with GAAP requires the Company's management to make estimates and assumptions that affect the amounts disclosed in the financial statement. Actual results could differ from those estimates. ## 2. Net capital requirement The Company, as a registered broker-dealer, is subject to the SEC Uniform Net Capital Rule 15c3-1. This Rule requires the maintenance of minimum net capital and that the ratio of aggregate indebtedness to net capital, both as defined, shall not exceed 15 to 1 and that equity capital may not be withdrawn or cash dividends paid if the resulting aggregate indebtedness to net capital ratio would exceed 10 to 1. At December 31, 2023, the Company's net capital was approximately \$80,690, which was approximately \$75,690 in excess of its minimum net capital requirement of \$5,000. ## 3. Exemption from Rule 15c3-3 The Company is no longer claiming exemption from SEC Rule 15c3-3, in reliance on footnote 74 to SEC Release 34- 70073, and as discussed in Q&A 8 of the related FAQ issued by SEC staff. The Company has represented that it does not and will not, directly or indirectly receive, hold or otherwise owe funds or securities for or to customers, does not and will not carry accounts of or for customers and does not and will not carry PAB accounts. The Company's business activities are, and will remain the private placement of securities, including providing advice regarding structuring, financing, investment or divestment, and evaluation of investment alternatives. ## 4. Related party transactions The Company provides private placement agent services to CDI and receives fees for these services. Success fees amounted to \$403,176 and retainer fees amounted to \$144,000 for the year ended December 31, 2023. The Company was recharged \$383,977 by the Parent for sales commission expenses to registered representatives for the year ended December 31, 2023. Pursuant to a separate agreement, (the "Agreement"), with Parent (effective March 1, 2020), the Company recognizes certain general and administrative expenses (such as rent, office expenses, and other fees) based on the terms and conditions per the Agreement. General and administrative expenses under this Agreement amounted to \$12,600 for the year ended December 31, 2023. The receivables and payables from/to CDI and Parent fluctuates based on the timing of cash payments, the amount of success fees, and the intercompany recharges from CDI and Parent. As a result of the above transactions, the Company had a net receivable of \$nil and \$42,142 at December 31, 2022 and 2023 respectively, and a net payable of \$18,316 and \$0 at December 31, 2022 and December 31, 2023 respectively. ## 5. Subsequent events Management has evaluated subsequent events through the date the financial statement was available for issuance. The Company received a capital contribution from the Parent of \$100,000 on February 29, 2024. Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.