# EDGAR Filing Document

**Accession Number:** 0001681732
**File Stem:** 0001681732-23-000002
**Filing Date:** 2023-2
**Character Count:** 24563
**Document Hash:** a2b018df7234d0209d787e36f038e36e
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001681732-23-000002.hdr.sgml**: 20230228

**ACCESSION NUMBER**: 0001681732-23-000002

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

**PUBLIC DOCUMENT COUNT**: 2

**CONFORMED PERIOD OF REPORT**: 20221231

**FILED AS OF DATE**: 20230228

**DATE AS OF CHANGE**: 20230228

**EFFECTIVENESS DATE**: 20230228

**PERIOD START**: 20220101

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** LSH PARTNERS SECURITIES LLC
- **CENTRAL INDEX KEY:** 0001681732
- **IRS NUMBER:** 813307080
- **STATE OF INCORPORATION:** DE
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** X-17A-5
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 008-69817
- **FILM NUMBER:** 23689437

**BUSINESS ADDRESS:**
- **STREET 1:** 444 MADISON AVENUE
- **STREET 2:** SUITE 2801
- **CITY:** NEW YORK
- **STATE:** NY
- **ZIP:** 10022
- **BUSINESS PHONE:** 646 453 5660

**MAIL ADDRESS:**
- **STREET 1:** 444 MADISON AVENUE
- **STREET 2:** SUITE 2801
- **CITY:** NEW YORK
- **STATE:** NY
- **ZIP:** 10022

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** ASHWOOD PARTNERS SECURITIES LLC
- **DATE OF NAME CHANGE:** 20160805

### Attached PDF Documents

**Attachment 1:** `lshpublic.pdf`

# LSH PARTNERS SECURITIES, LLC

## STATEMENT OF FINANCIAL CONDITION

DECEMBER 31, 2022

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

| OMB APPROVAL |
| --- |
| OMB Number: 3235-0123 |
| Expires: Oct. 31, 2023 |
| Estimated average burden hours per response: 12 |

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

| SEC FILE NUMBER |
| --- |
| 8-69817 |

**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 01/01/2022 AND ENDING 12/31/2022
MM/DD/YY MM/DD/YY

**A. REGISTRANT IDENTIFICATION**

NAME OF FIRM: LSH Partners Securities, LLC

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.)

444 Madison Avenue, Suite 2801

(No. and Street)
New York NY 10022
(City) (State) (Zip Code)

PERSON TO CONTACT WITH REGARD TO THIS FILING

Chad Kirschenblatt 516-222-9111 chad.kirschenblatt@jrlc.com
(Name) (Area Code - Telephone Number) (Email Address)

**B. ACCOUNTANT IDENTIFICATION**

INDEPENDENT PUBLIC ACCOUNTANT whose reports are contained in this filing*

Berdon LLP

(Name - if individual, state last, first, and middle name)
100 Jericho Quadrangle Jericho NY 11753
(Address) (City) (State) (Zip Code)
8-27-2004 1506

(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, James L. Kemper, swear (or affirm) that, to the best of my knowledge and belief, the financial report pertaining to the firm of LSH Partners Securities, LLC, as of 12/31, 2022, 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.

Lori A Dowe

Signature: [Signature]
Title:
President

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.

Lori A Dowe
NOTARY PUBLIC, STATE OF NEW YORK
Registration No. 4868325
Qualified in New York County
Commission Expires August 18, 2024

# **LSH PARTNERS SECURITIES, LLC**

**DECEMBER 31, 2022**

# **TABLE OF CONTENTS**

Report of Independent Registered Public Accounting Firm

|  | Page |
| --- | --- |
| Statement of Financial Condition ... | 1 |
| Notes to Financial Statement ... | 2-6 |

BERDON

BERDON LLP

360 Madison Avenue, New York, NY 10017-212.832.0400

100 Jericho Quadrangle - Suite 342, Jericho, NY 11753-516.931.3100

# REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Member of
LSH Partners Securities, LLC

# Opinion on the Financial Statement

We have audited the accompanying statement of financial condition of LSH Partners Securities, LLC (the “Company”) as of December 31, 2022, and the related notes to the financial statement (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, 2022, in conformity with accounting principles generally accepted in the United States of America.

# Basis for Opinion

The 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 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.

Certified Public Accountants

We have served as the Company’s auditors since 2021.

Jericho, New York
February 28, 2023

-1-

# **LSH PARTNERS SECURITIES, LLC**

# **STATEMENT OF FINANCIAL CONDITION  
DECEMBER 31, 2022**---

# **ASSETS**

| Cash | $1,112,457 |
| --- | --- |
| Accounts receivable | 27,500 |
| Prepaid expenses | 6,895 |
| Total assets | $1,146,852 |

# **LIABILITIES AND MEMBER'S EQUITY**

| Liabilities: |  |
| --- | --- |
| Due to member | $319,511 |
| Accounts Payable | 39,964 |
| Deferred Revenue | 66,667 |
| Total liabilities | 426,142 |
| Member's equity | 720,710 |
| Total liabilities and member's equity | $1,146,852 |

The accompanying notes are an integral part of this financial statement

1

# **LSH PARTNERS SECURITIES, LLC**  
**NOTES TO THE FINANCIAL STATEMENT**  
**DECEMBER 31, 2022**---

# **1. ORGANIZATION AND DESCRIPTION OF BUSINESS**

LSH Partners Securities, LLC (the 'Company') is wholly-owned by LSH Partners, LLC (the 'Member'). The Company was organized on May 31, 2016 as a Delaware limited liability company and is registered to do business in New York as a foreign limited liability company. The Company is a registered broker-dealer under the Securities Exchange Act of 1934 and is a member of both the Financial Industry Regulatory Authority, Inc. ('FINRA') and the Securities Investors Protection Corporation ('SIPC') as of November 15, 2016. The operating agreement provides for the limited liability company to exist in perpetuity. The member's limit on liability is based on the relevant state law. The Company renders financial advisory services to selected clients with respect to capital raising, business restructurings and other financial services.

The firm does not claim an exemption from SEA 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 Firm has represented that it does not and will not, (1) directly or indirectly receive, hold, or otherwise owe funds or securities for or to customers, (2) does not and will not carry accounts of or for customers and (3) does not and will not carry PAB accounts. The firm's business activities are, and will remain as described below.

# **2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**

# ***Basis of presentation***

The accompanying financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America ('U.S. GAAP').

# ***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.

# ***Revenue recognition***

In accordance with ASU No. 2014-09, Revenue from Contracts with Customers ('ASC 606') revenues from contracts with customers is recognized when, or as, the Company satisfies its performance obligations by transferring the promised services to the customers. A service is transferred to a customer when, or as, the customer obtains control of that service. A performance obligation may be satisfied at a point in time or over time. Revenue from a performance obligation satisfied at a point in time is recognized at the point in time that the Company determines the customer obtains control over the promised service. Revenue from a performance obligation satisfied over time is recognized by measuring the Company's progress in satisfying the performance obligation in a manner that depicts the transfer of the services to the customer.

# **LSH PARTNERS SECURITIES, LLC**  
**NOTES TO THE FINANCIAL STATEMENT**  
**DECEMBER 31, 2022**---

# **2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** *(continued)*

# ***Revenue recognition*** *(continued)*

The amount of revenue recognized reflects the consideration the Company expects to receive in exchange for those promised services (i.e., the “transaction price”). In determining the transaction price, the Company considers multiple factors, including the effects of variable consideration, if any.

The Company provides advisory services on mergers and acquisitions (M&A). Revenue for advisory arrangements is generally recognized at the point in time that performance under the arrangement is completed (the closing date of the transaction) or the contract is cancelled. However, for certain contracts, revenue is recognized over time for advisory arrangements in which the performance obligations are simultaneously provided by the Company and consumed by the customer. In some circumstances, significant judgment is needed to determine the timing and measure of progress appropriate for revenue recognition under a specific contract. Retainers and other fees received from customers prior to recognizing revenue are reflected as contract liabilities.

As part of their corporate advisory work the Company will earn a success fee to assist clients with capital raising which includes introducing potential investors and/or assisting in the sale of the company or the private placement of securities in furtherance of a capital raise. Management believes that the performance obligation is satisfied on the closing date of the transaction, and the success fee becomes payable. Retainers received may be deducted when determining the success fee. Retainers and other fees received from clients before recognizing revenue are reflected as deferred revenues. Advisory fees and success fees were earned over time and at a point in time, respectively for the year ended December 31, 2022.

As of December 31, 2022, the Company has $27,500 in receivables from contracts with customers. As of December 31, 2022 the Company has $66,667 in deferred revenue from contracts with customers.

# ***Accounts Receivable***

Accounts receivable are reported net of an allowance for doubtful accounts. The allowance is based on management’s estimate of the amount of receivables that will actually be collected. Management determined that at December 31, 2022, an allowance for doubtful accounts was not necessary.

3

# **LSH PARTNERS SECURITIES, LLC**  
**NOTES TO THE FINANCIAL STATEMENT**  
**DECEMBER 31, 2022**---

# **2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** *(continued)*

# ***Valuation of Investments at Fair Value***

The Company applies the provisions of ASC 820, Fair Value Measurements, which, among other matters, requires disclosures about investments that are measured and reported at fair value. ASC 820 establishes a hierarchical disclosure framework which prioritizes and ranks the level of market price observability used in measuring investments at fair value. Market price observability is affected by a number of factors, including the type of investment and the characteristics specific to the investment. Investments with readily available active quoted prices or for which fair value can be measured from actively quoted prices generally will have a higher degree of market price observability and a lesser degree of judgment used in measuring fair value. Management reviews on a periodic basis financial information to determine the fairness of the valuation inputs obtained for any level 3 investment. Investments measured and reported at fair value are classified and disclosed in one of the following categories:

**Level 1** - Unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access.

**Level 2** - Observable inputs other than the quoted prices in level 1 that are observable for the asset or liability either directly or indirectly. These inputs may include quoted prices for the prices for similar assets and liabilities and other observable information that can be corroborated by market data.

**Level 3** - Unobservable inputs for the asset or liability to the extent that relevant observable inputs are not available, representing the management’s own assumptions about the assumptions that a market participant would use in valuing the asset or liability, and that would be based on the best information available.

The Company did not have any investments as of December 31, 2022.

# ***Income taxes***

As a wholly-owned limited liability company, the Company is considered to be a disregarded entity for tax reporting purposes and is thus not subject to Federal, state or local income taxes and does not file income tax returns in any jurisdiction. All items of income, expense, gains and losses are reportable by the Member for tax purposes.

4

# **LSH PARTNERS SECURITIES, LLC**  
**NOTES TO THE FINANCIAL STATEMENT**  
**DECEMBER 31, 2022**---

# **2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** *(continued)*

# ***Leases***

In accordance with ASC 842, Leases (“ASC 842”), the Company accounts for its existing operating lease as an operating lease using the practical expedients permitted under ASC Topic 842. The Company defines a short-term lease as a lease that, at the commencement date, has a lease term of 12 months or less and does not contain an option to purchase the underlying asset that the lease is reasonably certain to exercise. The Company elected to recognize short-term lease payments as an expense on a straight-line basis over the lease term. Related variable lease payments are recognized in the period in which the obligation is incurred. The Company’s lease obligations are deemed to be short term.

# ***Credit Losses***

ASC 326, Financial Instruments - Credit Losses (“ASC 326”), impacts the impairment model for certain financial assets by requiring a current expected credit loss (“CECL”) methodology to estimate expected credit losses over the entire life of the financial asset. Under ASC 326, the Company has the ability to determine that there are no expected credit losses in certain circumstances (e.g., based on the credit quality of the customer).

# ***Uncertain tax positions***

The Company applies the provisions of ASC 740, Income Taxes, as they relate to uncertain tax positions. The Company was not required to recognize any amounts from uncertain tax positions at December 31, 2022.

The Company’s conclusions regarding uncertain tax positions may be subject to review and adjustment at a later date based upon ongoing analyses of tax laws, regulations and interpretations thereof as well as other factors. In the event that tax authorities assess interest and penalties on unrecognized tax benefits, the Company will reflect such amounts in tax expense and income taxes payable

# **3. CONCENTRATION OF CREDIT RISK**

The Company’s cash deposits are held by one financial institution and therefore, are subject to credit risk to the extent those balances exceeded the Federal Deposit Insurance Corporation (“FDIC”) insurance limit of $250,000. The Company has not experienced any losses in such accounts and does not believe it is exposed to any significant credit risk on cash.

5

# **LSH PARTNERS SECURITIES, LLC**  
**NOTES TO THE FINANCIAL STATEMENT**  
**DECEMBER 31, 2022**---

# **4. RELATED PARTY TRANSACTIONS**

Pursuant to an expense sharing agreement, the Company reimburses the member for allocated salaries, rent and communication expenses paid for by the Member. These charges are updated periodically, and determined based on percentages of personnel time and other factors. For the year ended December 31, 2022, the Member charged the Company $2,045,258 for such expenses.

For the year ended December 31, 2022, pursuant to a unanimous consent, the Member of the Company made cash capital contributions of $100,000. The Company has recorded a due to member in the amount of $319,511 related to unpaid allocated expenses as of December 31, 2022. Amounts due to member are non-interest bearing and are due on demand.

# **5. COMMITMENTS AND CONTINGENCIES**

As a regulated securities broker dealer, from time to time the Company may be involved in legal proceedings and regulatory audits. The Company is currently involved in an ongoing FINRA review of employees outside business activities and believes the matter will be resolved in the near future.

# **6. NET CAPITAL REQUIREMENTS**

The Company is subject to the uniform net capital requirements of Rule 15c3-1 (“The Rule”) of the Securities and Exchange Act, as amended, which requires the Company to maintain, at all times, sufficient liquid assets to cover indebtedness. In accordance with the Rule, the Company is required to maintain defined minimum net capital of the greater of $5,000 or 6 2/3% of aggregate indebtedness.

At December 31, 2022, the Company had net capital, as defined, of $686,315, which exceeded the required minimum net capital of $28,409 by $657,906. Aggregate indebtedness at December 31, 2022 totaled $426,142. The Company’s percentage of aggregate indebtedness to net capital was 62.09%.

It is the intention of the member to continue to support and operate the Company for the twelve-month period from the date that these financial statements are issued and contribute the necessary capital to maintain the operations, fund its ongoing expenses and meet the net capital requirements of the SEC’s Uniform Net Capital Rule.

# **7. SUBSEQUENT EVENTS**

Management of the Company has evaluated events and transactions that have occurred through February 28, 2023, the date these financial statements were available to be issued and determined that there are no material events that would require disclosures in the Company’s financial statements.

6

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

## FORM X-17A-5

### ANNUAL AUDITED REPORT

### Filer Information

**Filer CIK:** 0001681732

**Filer CCC:** XXXXXXXX

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

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

### Submission Information

**Report Period Begin Date:** 01-01-2022

**Report Period End Date:** 12-31-2022

**Type of Registrant:** Broker-dealer

**Any material weaknesses identified?:** No

### Registrant Identification

**Name of Broker-Dealer:** LSH PARTNERS SECURITIES LLC

**Business Address:** 444 MADISON AVENUE, SUITE 2801, NEW YORK, NY, 10022

**Contact Person:** Chad Kirschenblatt

**Contact Phone:** 516 222 9111

### Independent Public Accountant Identification

**Accountant Name:** Berdon LLP

**Accountant Address:** 100 Jericho Quadrangle, Jericho, NY, 11753

**Accountant Type:** Certified Public Accountant

### OATH OR AFFIRMATION

I, **James L. Kempner**, swear (or affirm) that, to the best of my knowledge and belief, the accompanying financial statements and supporting schedules pertaining to the firm of **LSH PARTNERS SECURITIES LLC**, as of **12-31-2022**, are true and correct.

**Signature:** James L. Kempner

**Title:** President

**Notarized:** Yes