# EDGAR Filing Document

**Accession Number:** 0001240287
**File Stem:** 0001240287-25-000001
**Filing Date:** 2025-6
**Character Count:** 23120
**Document Hash:** c586db5b48d2cbc945790f032ac14707
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001240287-25-000001.hdr.sgml**: 20250612

**ACCESSION NUMBER**: 0001240287-25-000001

**CONFORMED SUBMISSION TYPE**: X-17A-5

**PUBLIC DOCUMENT COUNT**: 2

**CONFORMED PERIOD OF REPORT**: 20241231

**FILED AS OF DATE**: 20250612

**DATE AS OF CHANGE**: 20250612

**EFFECTIVENESS DATE**: 20250612

**PERIOD START**: 20240101

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** KCD FINANCIAL, INC.
- **CENTRAL INDEX KEY:** 0001240287

**ORGANIZATION NAME:**
- **EIN:** 331057766
- **STATE OF INCORPORATION:** WI
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** X-17A-5
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 008-66005
- **FILM NUMBER:** 251042510

**BUSINESS ADDRESS:**
- **STREET 1:** 3061 ALLIED STREET
- **STREET 2:** SUITE B
- **CITY:** GREEN BAY
- **STATE:** WI
- **ZIP:** 54304
- **BUSINESS PHONE:** 920-347-3400

**MAIL ADDRESS:**
- **STREET 1:** 3061 ALLIED STREET
- **STREET 2:** SUITE B
- **CITY:** GREEN BAY
- **STATE:** WI
- **ZIP:** 54304

### Attached PDF Documents

**Attachment 1:** `kcdfinancial2024pub3.pdf`

# KCD FINANCIAL, INC.

## FINANCIAL STATEMENT

### PURSUANT TO SEC RULE 17A-5(d)

December 31, 2024

**AVAILABLE FOR PUBLIC INSPECTION**

# UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

# ANNUAL REPORTS
FORM X-17A-5
PART III

| OMB APPROVAL |
| --- |
| OMB Number: 3235-0123 |
| Expires: Nov. 30, 2026 |
| Estimated average burden hours per response: 12 |

| SEC FILE NUMBER |
| --- |

## 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 01/01/2024 AND ENDING 12/31/2024
MM/DD/YY MM/DD/YY

## A. REGISTRANT IDENTIFICATION

NAME OF FIRM: KCD Financial Inc.

TYPE OF REGISTRANT (check all applicable boxes):
☑ Broker-dealer
☐ Security-based swap dealer
☐ Check here if respondent is also an OTC derivatives dealer
☐ Major security-based swap participant

ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use a P.O. box no.)
3061 ALLIED STREET SUITE B

| (No. and Street) |  |  |
| --- | --- | --- |
| GREEN BAY | WI | 54304 |
| (City) | (State) | (Zip Code) |
| PERSON TO CONTACT WITH REGARD TO THIS FILING |  |  |
| JOEL BLUMENSCHEIN | 9203473400 | JOELB@KCDFINANCIAL.COM |
| (Name) | (Area Code - Telephone Number) | (Email Address) |

## B. ACCOUNTANT IDENTIFICATION

INDEPENDENT PUBLIC ACCOUNTANT whose reports are contained in this filing*

## FLYNN &amp; COMPANY

| (Name - if individual, state last, first, and middle name) |  |  |  |
| --- | --- | --- | --- |
| 7800 E. KEMPER ROAD SUITE 150 | CINCINNATI | OH | 45249 |
| (Address) | (City) | (State) | (Zip Code) |
| 11/17/2009 |  | 3876 |  |
| (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.

# OATH OR AFFIRMATION

I, JOEL BLUMENSCHEIN, swear (or affirm) that, to the best of my knowledge and belief, the financial report pertaining to the firm of **KCO FINANCIAL INC.**, as of **12/31**, **2024**, 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.

![img-0.jpeg](img-0.jpeg)

![img-1.jpeg](img-1.jpeg)

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) Reconditions, 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.**

KCD FINANCIAL, INC.

# STATEMENT OF FINANCIAL CONDITION AND REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

DECEMBER 31, 2024

## CONTENTS

|  | Page |
| --- | --- |
| Report of Independent Registered Public Accounting Firm on Statements of Financial Condition | 1 |
| Financial Statement: |  |
| Statement of Financial Condition | 2 |
| Notes to Financial Statement | 3-8 |

Flynn &amp; Company
CPAs &amp; Business Consultants

# REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders
of KCD Financial, Inc.

## Disclaimer of Opinion on the Financial Statements

We were engaged to audit the accompanying statement of financial condition of KCD Financial, Inc. (the "Company") as of December 31, 2024, and the related notes (collectively referred to as the "financial statements"). The Company did not appropriately recognize revenue and related commission expense in the appropriate period, which impacts account balances for accounts receivable and accounts payable, as such we were not able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion on the financial statements, and we do not express, an opinion on these financial statements.

## Basis for Disclaimer of Opinion

These financial statements are the responsibility of the Company's management. 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.

*[Handwritten signature and date: "Glynn &amp; Company, Inc."]*

We have served as KCD Financial, Inc.’s auditor since 2025.

Cincinnati, OH
May 30, 2025

7800 E. Kemper Road, Suite 150 | Cincinnati, OH 45249 | P. 513.530.9200 | F. 513.530.0555 | www.flynncoop.com
-1-

KCD Financial, Inc.
Statement of Financial Condition
December 31, 2024

## Assets

| Assets |  |
| --- | --- |
| Cash and Cash Equivalents | $641,852 |
| Clearing Deposit | 31,573 |
| Due from broker | 7,855 |
| Short Term Treasury(HTS) | 273,774 |
| Accounts Receivable - Concessions | 444,397 |
| Accounts Receivable - Other | 67,462 |
| Fixed Assets (Net of accumulated depreciation of 14069) | 0 |
| Prepaid Expense | 57,849 |
| Other Assets | 20,000 |
| Right of Use Office lease | 25,625 |
| Total Assets | $1,570,387 |

## Liabilities and Shareholders' Equity

| Liabilities |  |
| --- | --- |
| Accounts Payable and Accrued Expenses | $749,822 |
| Credit Card | 16,781 |
| Income tax payable | 55,376 |
| Deferred Revenue | 107,039 |
| Office lease |  |
| Total Liabilities | $929,018 |
| Shareholders' Equity |  |
| Preferred Stock ($0.001 par value)* |  |
| Common Stock ($0.001 par value)** | $1 |
| Additional Paid in Capital | 125,306 |
| Treasury Stock | (11,000) |
| Retained Earnings | 503,131 |
| Total Shareholders' Equity | $617,438 |
| Total Liabilities and Shareholders' Equity | $1,546,456 |

* 10,000 authorized, 0 outstanding
** 50,000 authorized, 8,384 issued and 8,250 outstanding

The accompanying notes to the financial statement are an integral part of this statement

Page 2

KCD Financial, Inc.
Green Bay, Wisconsin
Notes to Financial Statement
December 31, 2024

## Note 1. Business Activity and Significant Accounting Policies

KCD Financial, Inc. (the "Company") operates a brokerage services firm located in Green Bay, Wisconsin. The Company is a non-holding broker/dealer. The Company is licensed by the Financial Industry National Regulatory Authority, Inc. and is subject to the rules of that association. The Company currently purchases stocks, mutual funds, real estate investments and insurance policies at the request of its clients.

The Company operates under the provisions of Paragraph (k)(2)(ii) of Rule 15c3-3 of the Securities and Exchange Commission and, accordingly, is exempt from the remaining provisions of the Rule. The requirements of paragraph (k)(2)(ii) provide that the Company clear all transactions on behalf of customers on a fully-disclosed basis with a clearing broker-dealer. The clearing broker-dealer carries all of the accounts of the customers and maintains and preserves all related books and records as are customarily kept by a clearing broker-dealer.

Significant accounting policies are as follows:

**Use of Estimates:** The preparation of financial statements in conformity with U.S. 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 differ from those estimates.

**Cash and Equivalents:**

The Company has defined cash equivalents as highly liquid investments, with original maturities of less than three months that are not held for sale in the ordinary course of business.

**Reserves and Custody of Securities:** The Company did not hold securities for sale, nor did it hold customer securities at December 31, 2024. Because the Company does not handle customers’ securities, Rule 15(c)3-3, in regard to computation for determination of reserve requirements and information relating to the possession or control requirements, does not apply.

**Accounts Receivable - Concessions:** Accounts receivable concessions are reported at contract value, less estimates for uncollectible amounts based on experience relative to the population of accounts receivable.

**Deferred Revenue:** Deferred revenue consists of fees collected from representatives to off-set future operating expenses.

**Furniture and Equipment:** During the year, no new computer hardware was purchased. Previous purchased items were set to depreciate on a 5-year schedule.

**Income Taxes:** Income taxes are provided for the tax effects of transactions reported in the financial statements and consist of taxes currently due less any prepayment of estimated taxes. As of December 31, 2024, the company has income tax payable of $55,376

3

KCD Financial, Inc.
Green Bay, Wisconsin
Notes to Financial Statement
December 31, 2024

Deferred Income taxes are recorded to reflect the future tax consequences of difference between the carrying value of assets and liabilities for income tax and financial reporting purposes, and for the benefits of tax credit and loss carryforwards. The amounts of any future tax benefits are reduced by valuation allowance to the extent such benefits are not expected to be fully realized.

The Company has adopted FASB ASC 740, which provides guidance regarding how uncertain income tax positions should be recognized, measured, presented, and disclosed in the financial statements. FASB ASC 740 prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. FASB ASC 740 also provides guidance in de-recognition of tax benefits, classification on the balance sheet, interest and penalties, accounting in interim periods, disclosure, and transition.

The Company evaluates tax positions taken on its tax return in accordance with accounting principles generally accepted in the United States of America, which require that tax positions taken be more likely-than-not to be sustained. Management believes that the Company has no significant unrecognized tax benefit under those criteria. Penalties and interest, if any, assessed by income taxing authorities are included in operating expenses.

For US Federal Income Taxes, the Company is no longer subject to examination for those tax years ending later of 3 years from the current year's tax return due date, or the date that the return was actually filed. For Wisconsin State Income Taxes, the Company is no longer subject to examinations for those years ending the later of 4 years from the current year's tax return due date, or the date that the return was actually filed.

On December 22, 2017 The President signed into law tax reform legislation effective for tax years ending after December 31, 2017 ("the Act"). The Act replaces the prior corporate tax rate structure with a flat 21% rate, effective in 2018. There were many other future impacts of the tax reform such as the repeal of the corporate alternative minimum tax rate, tax loss carryback and carryforward limitations, ect. However, there is no impact to these financial statements other than a reduced federal corporate tax rate.

## Note 2. Clearing Deposit

In accordance with the agreement with its clearing broker, Hilltop Securities, Inc. (HSI), the Company is required to maintain cash deposits in the amount of $30,000. The Company is dependent on HSI for the everyday processing of customer transactions as required under the provisions of paragraph (k)(2)(ii) of Rule 15c3-3 of the Securities and Exchange Commission. As of December 31, 2024 the Company maintained $31,573 in clearing deposits at HSI and $32,569 in cash at another financial institution, to satisfy regulatory requirements.

4

KCD Financial, Inc.
Green Bay, Wisconsin
Notes to Financial Statement
December 31, 2024

## Note 3. Net Capital Requirements and Filing Requirements

The Company is subject to the SEC Uniform Net Capital Rule (SEC Rule 15c3-1), which requires the maintenance of minimum net capital and requires that the ratio of aggregate indebtedness to net capital, both as defined, shall not exceed 15 to 1. Rule 15c3-1 also provides that equity capital may not be withdrawn if the resulting net capital ratio would exceed 10 to 1. At December 31, 2024, the Company had net capital of $446,802, which was $396,80 in excess of its required net capital of $50,000. At December 31, 2024, the Company's net capital ratio was 2.08 to 1.

There were no liabilities subordinated to claims of creditors during the year ended December 31, 2024. Accordingly, a statement of changes in liabilities subordinated to claims of creditors is not included in the financial statements as required by Rule 17a-5 of the Securities and Exchange Commission.

## Note 4. Shareholders’ Equity

The Board of Directors (Board) of the Company is expressly vested with the authority to divide the Series Preferred Stock (SPS) into one or more series and to fix, determine and state the voting power, dividend, redemption, conversion, and liquidation rights, designations, preferences and relative, participating, optional or other special rights of the shares of each series and the qualifications, limitations and restrictions thereof in the resolution or resolutions providing for the issuance of such stock adopted by the Board hereto.

Subject to the prior and superior rights of the SPS and on the conditions set forth in any resolution or resolutions of the Board providing for the issuance of any particular series of the SPS, the Board may declare and pay dividends on the Common Stock (CS) from time to time as funds may be legally available. The dividends may be payable in cash, stock, or other property.

Subject to the voting rights, if any, as may be set forth in any resolution or resolutions of the Board providing for the issuance of any particular series of any SPS, the holders of the CS shall be entitled to one vote for each share held at all meetings of the stockholders of the Company. In the event of the liquidation, dissolution or winding up of the affairs of the Company and after all payments and distributions shall have been made in full to the holders of the SPS as may have been required under the terms of the resolution or resolutions of the Board providing for the issuance of any particular series of the SPS, the remaining assets and funds of the Company shall be distributed among the holders of the CS according to the respective shares.

Common stock consists of 50,000 authorized, 8,384 issued and 8,250 outstanding with a par value of $0.0001 per share.

Preferred stock consists of 10,000 authorized, and none outstanding with a par value of $0.0001 per share.

No preferred dividends were declared for fiscal year 2024, as no preferred stock outstanding and common dividends were declared in the amount of $10.00 per share for a total payment of $82,500, last dividend was paid on December 30, 2024.

5

KCD Financial, Inc.
Green Bay, Wisconsin
Notes to Financial Statement
December 31, 2024

## Note 5. Related Party Transactions

Through common ownership and management, the Company is affiliated with Freedom Securities, Inc. (FSI) who owns 78.7% of common stock shares of the Company. The companies share personnel and other services. The Company did pay a cash dividend during the year to its affiliated company in the amount of $62,500.

## Note 6. Operating Lease

The Company will recognize leases in accordance with FASB ASC Topic 842 “Leases”, beginning January 1, 2019. That guidance was amended to require public business entities to recognize a right-of-use asset and lease liability in the statement of financial condition. The amendment is effective for the Company’s fiscal years beginning after December 15, 2018, which is different than the effective date for nonpublic business entities. Management believes the impact of the amendment to Topic 842 will have no material impact on its statement of financial condition.

The Company leases office space under a lease agreement which expires March 31, 2025.

The following is a schedule, by years, of future minimum payments under the new operating lease in effect as of December 31, 2020:

| 2025 | $20,791 |
| --- | --- |
| 2026 | $7,012 |

## Note 7. Commitments and Contingencies

In the normal course of business, the Company may become subject to various claims, litigation, regulatory, and arbitration matters. Currently, the Company is subject to two matters. Currently those matters are scheduled for mediation and the Company does not expect any material consequences from arising from the mediations.

In the normal course of business, the Company enters into contracts and agreements that contain a variety of representations and warranties that provide indemnifications under certain circumstances. The Company’s maximum exposure under these arrangements is unknown, as this would involve future claims and may be made against the Company that have not yet occurred. The Company expects the risk of loss or future obligations under these indemnifications to be remote.

There were no such matters or indemnifications known to the Company as of December 31, 2024.

### UNITED STATES SECURITIES AND EXCHANGE COMMISSION
**Washington, D.C. 20549**

## FORM X-17A-5

### ANNUAL AUDITED REPORT

### Filer Information

**Filer CIK:** 0001240287

**Filer CCC:** XXXXXXXX

**Is this a LIVE or TEST filing?:** LIVE

**Would you like a Return Copy?:** No

### Submission Information

**Report Period Begin Date:** 01-01-2024

**Report Period End Date:** 12-31-2024

**Type of Registrant:** Broker-dealer

**Any material weaknesses identified?:** No

### Registrant Identification

**Name of Broker-Dealer:** KCD FINANCIAL, INC.

**Business Address:** 3061 ALLIED STREET, SUITE B, GREEN BAY, WI, 54304

**Contact Person:** JOEL BLUMENSCHEIN

**Contact Phone:** 9203473400

### Independent Public Accountant Identification

**Accountant Name:** FLYNN & COMPANY

**Accountant Address:** 7800 E. kemper Road Suite 150, Cincinnati, WI, 45249

**Accountant Type:** Certified Public Accountant

### OATH OR AFFIRMATION

I, **JOEL BLUMENSCHEIN**, swear (or affirm) that, to the best of my knowledge and belief, the accompanying financial statements and supporting schedules pertaining to the firm of **KCD FINANCIAL, INC.**, as of **12-31-2024**, are true and correct.

**Signature:** JOEL BLUMENSCHEIN

**Title:** FINOP

**Notarized:** Yes