# FIN2, LLC X-17A-5 (2024-06-28) — Broker-dealer annual report - Company: FIN2, LLC - Form: X-17A-5 - Filed: 2024-06-28 - Period: 2024-03-31 - Accession: 0002013816-24-000043 - CIK: 1891229 - File #: 8-70818 - Type: Broker-dealer - Material weakness: No - Auditor: Nawrocki Smith LLP - Auditor location: Hauppauge, NY - Contact: Keith George - Phone: 212-668-8700 - Email: kgeorge@acisecure.com - Website: acisecure.com - Signed by: John Kevin Jokela (CEO) Original filing: https://www.sec.gov/Archives/edgar/data/1891229/000201381624000043/fintwoaudit.pdf --- {0}------------------------------------------------ | SEC FILE NUMBER | | |-----------------|--| | 8-70818 | | | mornation Required Rushent to Rules 173-3, 173-77, and 189-7 nuder the Securities Excluding Frances of 1334 | | | | | | | |-------------------------------------------------------------------------------------------------------------------------------------------------------------------|--|------------------------------------------------------------|-----------------------------------------|-------------------------------------------|--|--| | filing for the period beginning 11/21/2022 | | | _____ AND ENDING 03/31/2024 | | | | | MM/DD/YY
MM/DD/YY | | | | | | | | | | A. REGISTRANT IDENTIFICATION | | | | | | FIN2, LLC
name of firm: | | | | | | | | TYPE OF REGISTRANT (check all applicable boxes):
Security-based swap dealer
Broker-dealer
O Check here if respondent is also an OTC derivatives dealer | | | L Major security-based swap participant | | | | | ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use a P.O. box no.) | | | | | | | | 80 Broad Street, 5th Floor | | | | | | | | | | (No. and Street) | | | | | | New York
NY | | | | 10004 | | | | (State)
(City) | | | | (Zip Code) | | | | PERSON TO CONTACT WITH REGARD TO THIS FILING | | | | | | | | Keith George | | (212) 668-8700 | | kgeorge@acisecure.com | | | | (Name) | | (Area Code - Telephone Number) | (Email Address) | | | | | | | B. ACCOUNTANT IDENTIFICATION | | | | | | INDEPENDENT PUBLIC ACCOUNTANT whose reports are contained in this filing* | | | | | | | | Nawrocki Smith | | | | | | | | 100 Motor Parkway, Suite 580 Hauppauge | | (Name - if individual, state last, first, and middle name) | NY | 11788 | | | | (Address) | | (City) | (State) | (Zip Code) | | | | March 4, 2009 | | | 3370 | | | | | (Date of Registration with PCAOB)(if applicable) | | | | (PCAOB Registration Number, if applicable | | | | | | FOR OFFICIAL USE ONLY | | | | | {1}------------------------------------------------ | John Kevin Jokela | | | | | | , swear (or affirm) that, to the best of my knowledge and belief, the | | | |-------------------|--|--|--|--|--|-----------------------------------------------------------------------|--|--| | | | | | | | | | | | MONIQUE ROMERO | |----------------------------------| | | | NOTARY PUBLIC. STATE OF NEW YORK | | No. OTRO6308967 | | Qualified in New York County | | My Commission Expires 8/4/2026 | | | - - - - - - - - - - - - - - - - - - - - - - - - - - - {2}------------------------------------------------ **Financial Statements and Supplemental Information Pursuant to Rule 17a-5 under the Securities Exchange Act of 1934** **As of and for the Period from November 21, 2022 to March 31, 2024** **With Report of Independent Registered Public Accounting Firm** {3}------------------------------------------------ # **Contents** | For the Period from November 21, 2022 to March 31, 2024 | | |--------------------------------------------------------------------------------------------------------------------|-----| | Report of Independent Registered Public Accounting Firm | 1 | | Financial Statements | | | Statement of Financial Condition | 2 | | Statement of Operations | 3 | | Statement of Changes in Member's Equity | 4 | | Statement of Cash Flows | 5 | | Notes to Financial Statements | 6-7 | | Supplemental Information | | | Schedule I - Computation of Net Capital Under Rule 15c3-1 of
the Securities and Exchange Commission Act of 1934 | 8 | | Schedule II - Computation for Determination of Reserve Requirements
under Rule 15c3-3 (EXEMPTION) | 9 | | Schedule III - Information for Possession or Control Requirements
Under Rule 15c3-3 (EXEMPTION) | 9 | | Report of Independent Registered Public Accounting Firm | 10 | | Exemption Report | 11 | {4}------------------------------------------------ ![](_page_4_Picture_0.jpeg) # **REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM** To the Member of FIN2, LLC: # **Opinion on the Financial Statements** We have audited the accompanying statement of financial condition of FIN2, LLC (the "Company") as of March 31, 2024, the related statements of operations, changes in member's equity, and cash flows for the period from November 21, 2022 to March 31, 2024, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of FIN2, LLC as of March 31, 2024, and the results of its operations and its cash flows for the year then ended in conformity with accounting principles generally accepted in the United States of America. # **Basis for Opinion** These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements 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 ("SEC") 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 statements are 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 statements, 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 statements. 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 statements. We believe that our audit provides a reasonable basis for our opinion. # **Auditor's Report on Supplemental Information** The supplemental information contained on Schedules I, II and III have been subjected to audit procedures performed in conjunction with the audit of the Company's financial statements. The supplemental information is the responsibility of the Company's management. Our audit procedures included determining whether the supplemental information reconciles to the financial statements or the underlying accounting and other records, as applicable, and performing procedures to test the completeness and accuracy of the information presented in the supplemental information. In forming our opinion on the supplemental information, we evaluated whether the supplemental information, including its form and content, is presented in conformity with 17 C.F.R. §240.17a-5. In our opinion, the supplemental information is fairly stated, in all material respects, in relation to the financial statements as a whole. We have served as FIN2, LLC's auditor since 2024. Hauppauge, New York June 28, 2024 {5}------------------------------------------------ #### March 31, 2024 Statement of Financial Condition #### **ASSETS** | Cash
Due from clearing firm
Prepaid expenses and other assets | \$
21,541
125,116
11,231 | |---------------------------------------------------------------------|-----------------------------------| | TOTAL ASSETS | \$
157,888 | | LIABILITIES AND MEMBER'S EQUITY | | | LIABILITIES | | | Accounts payable and accrued expenses
Due to affiliate | \$
19,969
14,000 | | TOTAL LIABILITIES | 33,969 | | MEMBER'S EQUITY | | | TOTAL MEMBER'S EQUITY | 123,919 | | TOTAL LIABILITIES AND MEMBER'S EQUITY | \$
157,888 | See accompanying notes to financial statements {6}------------------------------------------------ #### Statement of Operations For the Period from November 21, 2022 to March 31, 2024 #### **REVENUE:** | Interest income | \$
89 | |--------------------------|-----------------| | Other income | 27 | | Total Revenue | 116 | | OPERATING EXPENSES: | | | Clearance charges | 48,943 | | Professional fees | 128,900 | | Regulatory fees | 17,098 | | Technology fees | 14,000 | | Occupancy | 1,794 | | Other expenses | 3,462 | | Total operating expenses | 214,197 | | NET LOSS | \$
(214,081) | | | | See accompanying notes to financial statements {7}------------------------------------------------ #### For the Period from November 21, 2022 to March 31, 2024 Statement of Changes in Member's Equity | | Total Member's Equity | | |----------------------------|-----------------------|-----------| | Balance, November 21, 2022 | \$ | 238,000 | | Net Loss | | (214,081) | | Contributions | | 100,000 | | Balance at March 31, 2024 | \$ | 123,919 | See accompanying notes to financial statements 4 {8}------------------------------------------------ #### For the Period from November 21, 2022 to March 31, 2024 Statement of Cash Flows | CASH FLOWS FROM OPERATING ACTIVITIES: | | |-------------------------------------------------------------------------------------------------------------------------------|-----------------| | Net Loss | \$
(214,081) | | Adjustments to reconcile net loss to net cash used in
operating activities
Changes in operating assets and liabilities: | | | Increase in due from clearing firm | (125,116) | | Increase in prepaid expenses | (11,231) | | Increase in accounts payable and accrued expenses | 19,969 | | Increase in due to affiliate | 14,000 | | Net cash used in operating activities | (316,459) | | CASH FLOWS FROM FINANCING ACTIVITIES: | | | Capital contributions | 100,000 | | Cash provided by financing activities | 100,000 | | NET DECREASE IN CASH | (216,459) | | CASH AT BEGINNING OF PERIOD | 238,000 | | CASH AT END OF PERIOD | \$
21,541 | See accompanying notes to financial statements {9}------------------------------------------------ #### For the Period from November 21, 2022 to March 31, 2024 Notes to Financial Statements # **1. Organization and Business** FIN2, LLC (the "Company") is a limited liability company headquartered in New York, New York and formed on October 4, 2021 under the laws of the state of Delaware. On November 21, 2022, the Company was approved as a broker-dealer and as such is registered with the U.S. Securities and Exchange Commission ("SEC") and is a member of the Financial Industry Regulatory Authority ("FINRA") and Securities Investor Protection Corporation ("SIPC"). The Company primarily provides retail brokerage of equity securities on an agency basis. ### **2. Summary of Significant Accounting Policies** # **Basis of Presentation** The Company's financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("US GAAP"). ### **Use of Estimates** The preparation of the financial statements in conformity with US 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 statements and the reported amounts of revenues and expenses during the reporting period. Actual results could vary from the estimates that were used. #### **Cash and Cash Equivalents** Cash consists of deposits with banks. These balances are federally insured up to \$250,000 per depositor at each financial institution. #### **Taxes** The Company is a single member limited liability company and is treated as a disregarded entity for income tax reporting purposes. The Internal Revenue Code provides that any income or loss is passed through to the members for federal and state income tax purposes. #### **Revenue Recognition** Fee revenues are recognized in the periods during which the related services are performed, and the amounts have been contractually earned. The Company applies Accounting Standards Update ("ASU") 2014-09 "Revenue from Contracts with Customers (Topic 606)." The Company recognizes revenue when its performance obligation is completed, based on the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance requires an entity to follow a five-step model to (a) identify the contract(s) with a customer, (b) identify the performance obligations in the contract, (c) determine the transaction price, (d) allocate the transaction price to the performance obligations in the contract, and (e) recognize revenue when (or as) the entity satisfies a performance obligation. In determining the transaction price, an entity may include variable consideration only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized would not occur when the uncertainty associated with the variable consideration is resolved. The Company earns fees from sharing of fully paid stock lending revenues with its clearing firm. Revenues and related clearing expenses are recorded on a trade-date basis. {10}------------------------------------------------ #### For the Period from November 21, 2022 to March 31, 2024 Notes to Financial Statements #### **3. Deposit and Receivable from Clearing Organization** Pursuant to its clearing agreement with Drivewealth LLC, the Company introduces all of its securities transactions to the clearing firm on a fully disclosed basis. Customer money balances and securities are carried on the books of the clearing firm. In accordance with terms of its clearing agreement, the Company maintains a deposit of \$125,000 with the clearing firm, which is reported on the statement of financial condition. ### **4. Net Capital Requirements** The Company is subject to SEC Uniform Net Capital Rule 15c3-1 under the Securities Exchange Act of 1934, which requires the maintenance of minimum net capital and requires that the percentage of aggregate indebtedness to net capital, both as defined, shall not exceed 15 to 1 (8 to 1 in its first year of operations). At March 31, 2024, the Company had net capital of \$112,688 which exceeded the required net capital of \$5,000 by \$107,688. The Company's percentage of aggregate indebtedness to net capital was 30%. The Company does not hold customers' cash or securities; therefore, it has no obligations under SEC Rule 15c3-3 under the Securities Exchange Act of 1934. ### **5. Related Party Transactions** Under an agreement with an affiliate, the Company incurs technology fees in the amount of \$1,000 per month. For the period from November 21, 2022 to March 31, 2024, the Company incurred a total of \$14,000 in technology fees and is reflected in the statement of operations. The technology fees account for the \$14,000 balance in the due to affiliate account on the Statement of Financial Condition as of March 31, 2024. #### **6. Commitments and Contingencies** The Company might be involved in legal matters that arise periodically in the ordinary course of business. At this time, the Company is not aware of any legal matters or customer complaints that are believed to be material to the Company's results of operations or financial condition. #### **7. Capital and Liquidity** The Company might not have sufficient liquidity to meet its anticipated obligations over the next year from the date of issuance of these financial statements. In connection with the Company's assessment of going concern considerations, management has determined that the Company will have access to funding from the parent company. The parent is committed to continuing to fund the ongoing operations of the Company. #### **8. Subsequent Events** The Company has evaluated subsequent events through the date of issuance of these financial statements. Based upon this evaluation, the Company has determined that no events have occurred that were to be recognized or disclosed in the financial statements. {11}------------------------------------------------ Computation of Net Capital Under Rule 15c3-1 of the Securities and Exchange Commission Act of 1934 As of March 31, 2024 | SCHEDULE I | | |------------------------------------------------------------------------------------------------------------|---------------| | TOTAL MEMBER'S EQUITY QUALIFIED FOR NET CAPITAL | \$
123,919 | | NON-ALLOWABLE DEDUCTIONS AND/OR CHARGES:
Prepaid expenses | (11,231) | | NET CAPITAL | \$
112,688 | | COMPUTATION OF BASIC NET CAPITAL REQUIREMENT
Minimum net capital required | \$
5,000 | | Excess net capital | \$
107,688 | | Net capital less greater of 10% of aggregate indebtedness
or 120% of the minimum dollar amount required | \$
106,688 | | AGGREGATE INDEBTEDNESS | \$
33,969 | | Percentage of aggregate indebtedness to net capital | 30% | | There are no material differences between the preceding | | computation and the Company's most recently filed Part II of Form X-17A-5 as of March 31, 2024. See Report of Independent Registered Public Accounting Firm {12}------------------------------------------------ As of March 31, 2024 Supplementary Information ### **Under Rule 15c3-3 (EXEMPTION) SCHEDULE II - Computation for Determination of Reserve Requirements** The Company is exempt from the provisions of Rule 15c3-3 under the Securities Exchange Act of 1934 in accordance with Rule 15c3-3(k)(2)(ii). # **Under Rule 15c3-3 (EXEMPTION) SCHEDULE III - Information for Possession or Control Requirements** The Company had no exceptions under SEC Rule 15c3-3 for the period from inception through March 31, 2023. The Company did not carry accounts of or for customers throughout the period from inception through March 31, 2023 without exception. See Report of Independent Registered Public Accounting Firm {13}------------------------------------------------ ![](_page_13_Picture_0.jpeg) # **REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM** To the Member of FIN2, LLC: We have reviewed management's statements, included in the accompanying Rule 15c3-3 Exemption Report pursuant to SEC Rule 17a-5, in which (1) FIN2, LLC (the "Company"). identified the following provision of 17 C.F.R. §15c3-3(k) under which the Company claimed the following exemption from 17 C.F.R. §240.15c3-3: (k)(2)(ii) and (2) the Company stated that FIN2, LLC met the identified exemption provisions throughout the most recent fiscal year without exception. The Company's management is responsible for compliance with the exemption provisions and its statements. Our review was conducted in accordance with the standards of the Public Company Accounting Oversight Board (United States) and, accordingly, included inquiries and other required procedures to obtain evidence about the Company's compliance with SEC Rule 15c3-3. A review is substantially less in scope than an examination, the objective of which is the expression of an opinion on management's statements. Accordingly, we do not express such an opinion. Based on our review, we are not aware of any material modifications that should be made to management's statements referred to above for them to be fairly stated, in all material respects, based on the provisions set forth in paragraph (k)(2)(ii) of Rule 15c3-3 under the Securities Exchange Act of 1934. Hauppauge, New York June 28, 2024 {14}------------------------------------------------ FIN2 (the "Company") is a registered broker-dealer subject to Rule 17a-5 as promulgated by the Securities and Exchange Commission (17 C.F.R. §240.17a-5, "Reports to be made by certain brokers and dealers"). This Exemption Report was prepared as required by 17 C.F.R. § 240.17a-5(d)(1) and (4). To the best of its knowledge and belief, the Company states the following: - (1) The Company claimed an exemption from 17 C.F.R. § 240.15c3-3 under the following provision of 17 C.F.R. § 240.15c3-3 (k): (exemption provision pursuant to paragraph (k)(2)(ii)) (the "exemption provision"). - (2) The Company met the identified exemption provision in 17 C.F.R. § 240.15c3-3(k) for the period from November 21, 2022 through March 31, 2024, without exception. I, Kevin Jokela, affirm that, to my best knowledge and belief, this Exemption Report is true and correct. \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ Signature \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ Print Name and Title Kevin Jokela, CEO Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.