G-405 PART I Report on Finances and Operations of Government Securiti

Implementing Regulations: Government Securities Act of 1986, as amended

gsrg405pt1_Apr2018

OMB: 1530-0064

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FORM
G-405

REPORT ON FINANCES AND
OPERATIONS OF GOVERNMENT
SECURITIES BROKERS AND DEALERS
PART I

OMB APPROVAL
OMB# 1530-0064

(Please read instructions before preparing Form.)
As of (Month/Day/Year)

Name of Government Securities Broker or Dealer
Address of Principal Place of Business
(No. and Street)

(City)

(State)

(ZIP Code)

INSTRUCTIONS
Schedule A— Routine Report
1. Subordinated Loan Agreements - (As Defined in Appendix D, Rule 15c3-1 as modified by 17 CFR 402.2d) - Enter the total amount of cash
obtained pursuant to subordinated loan agreements in effect at the report date. This item corresponds to the same item number in Parts II and IIA.
2. Secured Demand Notes - (As Defined in Appendix D, Rule 15c3-1 as modified by 17 CFR 402.2d) - Enter the total face amount of all secured
demand notes in effect at report date. This item corresponds to the same item number in Parts II and IIA.
3. Total Subordinations Allowable for Liquid Capital - (Total of lines 1 and 2) - This item corresponds to the same item number in Parts ll and lA.
4. Ownership Equity/Partnership Capital - Start of Month - Enter here the same total amount from the prior month-end (corrections of prior month
should be included on line 7) as reported on Part I or II. Lines 5 through 7 reflect all changes of ownership equity qualified for inclusion in liquid
capital from the last previously filed Form G-405.
5. Unconsolidated Income/Expense for the Month
a. Enter the net of realized and unrealized gains (or losses) in all trading, investment and other proprietary accounts for the current reporting
month. Losses should be recorded in brackets. This item corresponds to the sum of items 3950 and 3952 in Parts II and IIA.
b. Report unconsolidated gross income for the current reporting month excluding realized or unrealized gains (or losses) reported under item 5(a)
above.
c. Enter the total unconsolidated expense for the current reporting month. Provision for federal income taxes should not be included in this
amount.
d. Federal income taxes to be reported by corporations only.
6. Net Profit (or Loss) for the Month - Net of lines 5(a) through 5(d).
7. Other (Exclude Non-Conforming Capital)
a. Additions to Capital - includes all additions to capital even though subsequently withdrawn before the end of the period. Capital additions which
are not qualified for liquid capital should be excluded. Also include sale of capital stock or partners’ contributions and income adjustments
applicable to prior periods, or non-recurring items not included in 5(a), (b) or (d).
b. Deductions from Capital (Exclude Non-Conforming Capital) - include contributions made and withdrawn during the period, partners’ capital
withdrawals, retirement or repurchase of capital stock, dividends and income adjustments applicable to prior periods, or other non-recurring
items (adjusted for any related income tax provision) not included in lines 5(c) or (d).
8. Ownership Equity/Partnership Capital - End of Month - This item corresponds to the same item number in Parts II and IIA. Include here the total
of lines 4, 6 and 7(a) less 7(b).
9. Other Deductions or Allowable Credits - This item allows for adjustments, both deductions and additions (such as deferred tax credits) not
otherwise provided for in lines 4 through 8. These adjustments will generally arise as a result of the provisions of subparagraph (c)(2)(i) of Rule
15c3-1 as modified by 17 CFR 402.2(d)(3). Sole proprietors who are government securities brokers or dealers shall record on line 9 any
deductions required by subparagraph (c)(2)(iii) of Rule 15c3-1.
10. Total Capital and Allowable Subordinations - Total (add lines 3, 8 and 9) represents the capital and subordinated liabilities which are qualified
for liquid capital as defined in 17 CFR 402.2 which incorporates Rule 15c3-1 with modifications. This item corresponds to the same item number
in Parts II and IIA.
11. Added Charges - Customer and Non-Customer Securities Accounts - The rule requires a deduction for deficiencies in customers’ or noncustomers’ accounts in meeting the maintenance margin requirements set forth in Article III, Section 30, Appendix A of the Association’s Rules of
Fair Practice. This item corresponds to the same item number in Part II and represents charges other than amounts deducted as non-allowable
assets.
12. Operational Deductions from Liquid Capital - Enter total of lines 1 through 7 of Operational Deductions from Liquid Capital (Schedule B, Line 8).

13. Non-Allowable Assets (Not included in lines 11 and 12) - This total amount should exclude the value of securities borrowed under
subordination agreements not in satisfactory form, the market value of memberships in exchanges contributed for use of a company, and
partners’ securities which are included in non-allowable assets and excluded from line 10 as non-conforming capital.
14. Other Charges and/or Deductions - Include on this line all other charges and deductions to capital specified in Rule 15c3-1 as incorporated in
17 CFR 402.2 which are not included in lines 11 through 13. These deductions will include, but are not limited to, any secured demand note
deficiency, charges related to aged fails-to-deliver or fails-to-receive, deficits in securities loaned, aged security dividends short, losses on
contractual commitments, guarantees and insurance claims, etc. Also include deductions carried under Rule 15c3-1(c)(2)(x).
15. Total Deductions and/or Charges - Add line items 11 through 14.
16. Liquid Capital - Line item 10 less line item 15. This item corresponds to the same item in Parts II and IIA.
17. Total Haircuts - Report the sum of all haircuts, including those on contractual commitments, computed in accordance with 17 CFR 402.2(g)
and Appendix A thereto. This item corresponds to the same item number in Parts II and IIA.
18. Liquid Capital Less Haircuts - Line item 16 less line item 17. This item corresponds to the same item number in Parts II and IIA.
19. Scheduled Capital Withdrawals Within 6 Months - The amounts included herein shall include, but not be limited to, all obligations to repay, in
whole or in part, within the six months subsequent to the reporting date, any payment obligation as defined in Appendix D to Rule 15c3-1 as
modified by 17 CFR 402.2d. Also to be included are those items defined in the instructions to the schedule of capital withdrawals in Parts II or
IIA. This item corresponds to the same item number in Parts II and IIA.
20. Liquid Capital After Withdrawals - Line item 16 less line item 19.
21. Total Equity Subordinations - Enter the total amount of approved subordination agreements which are considered equity capital pursuant to
paragraph (d) of Rule 15c3-1.
22. Minimum Capital Requirement - Report the greater of (1) the amount of liquid capital necessary to exceed total haircuts (line 17) by the
amount required pursuant to 17 CFR 402.2(b) or (c); or (2) 120% of total haircuts.
23. Ratio/Excess Liquid Capital
a. Report the ratio of liquid capital (line 16) to total haircuts (line 17).
b. Report the amount of liquid capital in excess of the minimum capital requirement (line 22).
24. Total Credits - Rule 15c3-3 Reserve Formula - The credit balance to be reported on this line should be identical with the Rule 15c3-3 Formula
“Exhibit A” computation as modified by 17 CFR 403.4 which is to be prepared the business day following the month-end to determine the
amount to be deposited as specified under subsection (e)(1) by 10:00 a.m. the next (second) business day.
25. Total Debits - Rule 15c3-3 Reserve Formula - The debit balance to be reported on this line should be identical with the Rule 15c3-3 Formula
“Exhibit A” computation as modified by 17 CFR 403.4 which is to be prepared the business day following the month-end to determine the
amount to be deposited as specified under subsection (e)(1) by 10:00 a.m. the next (second) business day. The total debits should be net of
the 1% adjustment specified in Note E(3) of Exhibit A as modified by 17 CFR 403.4.
26. Amount in Reserve Bank Account - Include in this line item the actual amount on deposit (or deposited) by 10:00 a.m. of the second business
day following the end of the month. Include the total of both cash and qualified securities as defined under Rule 15c3-3, subparagraph (a)(6) as
modified by 17 CFR 403.4 which may be deposited in lieu of cash.
27. Firm Proprietary Positions
a. Long - All Securities - Report at market value all long positions carried in the proprietary accounts of the firm as of the current month-end
reporting period, i.e., trading and investment accounts, and other proprietary accounts. Do not include secured demand note collateral.
Include qualified securities held in banks pursuant to Rule 15c3-3(e)(1) as modified by 17 CFR 403.4.
b. Short - All Securities - Report at market value all short positions carried in the proprietary accounts of the firm as of the current month-end
reporting period. If market value is unavailable, the contract value is to be used.
c. Long - Contractual Commitments - GNMA’s, etc. - Include only U.S. Government Guaranteed Mortgage-Backed Securities, such as GNMA
securities. Report the total long positions in U.S. Government Guaranteed Mortgage-Backed Securities Commitments relating to forward
and standby contracts in firm accounts. The face amount of the securities under contract may be reported in lieu of market value or contract
value. Please designate which value is reported.
d. Short - Contractual Commitments - GNMA’s, etc. - Include only U.S. Government Guaranteed Mortgage-Backed Securities such as GNMA
securities. Report the total short positions in U.S. Government Guaranteed Mortgage-Backed Securities Commitments relating to forward
and standby contracts in firm accounts. The face amount of the securities under contract may be reported in lieu of market value or contract
value. Please designate which value is reported.
NOTE: 27(c) and (d)
Include forward contracts purchased or sold for delivery after five business days from the date of the transaction. Include delayed delivery
contracts such as TBAs (to be announced). Do not net forward contracts to purchase with forward contracts to sell and do not net long and
short standby contracts.
Standbys for the purpose of this item are put options, i.e., the purchaser of the standby has the right to sell a security at a specified price
within or at a specified time. A government securities dealer who is obligated to buy a security under a standby contract, for which he has
received a fee, should report the standby as a long position. A government securities dealer who has paid a fee for the right to sell securities
under a standby contract should report the standby as a short position.
Page 2

Form G-405 Part I

28. Customer and Non-Customer Charges - GNMA’s, etc. - Include only charges on forward contracts, TBAs (to be announced) and standby
contracts in U. S. Government Guaranteed Mortgage-Backed Securities.
29. Security Concentration/Commodity Concentration
a. Security Concentration - Firm - Report the aggregate value of all securities positions which are subject to undue concentration haircuts as
specified in subparagraph (c)(2)(vi)(M) of Rule 15c3-1 as incorporated in 17 CFR 402.2.
b. Security Concentration - Customer - Report the aggregate market value of specific securities, other than exempted securities, which exceeds
10% of the value of all securities which collateralize all margin receivables pursuant to Note E to Exhibit A of Rule 15c3-3 as modified by 17
CFR 403.4. The percentage standard of Note E has not been changed.
c. Commodity Concentration - Firm - Report concentrations in commodity futures carried in trading and investment accounts calculated as
follows:
1. Determine the greater of the total number of long or short commodity futures in each commodity. Positions representing purchases and
sales of a like amount of the same commodity or hedges of spot (cash) commodities where the spot commodity is in the possession or
under the control of the government securities broker or dealer may be eliminated.
2. Determine the greatest original margin requirement for each commodity stipulated by a registered U.S. Commodity Exchange for
speculative accounts. If the commodity exchange has no original margin requirement, use the clearing house margin requirement.
3. Determine the total amount of margin that would be required as per (2) above on the greater of the total number of long or short positions
in each commodity as per (1) above.
4. For each commodity calculated as per (3) above, determine whether (3) exceeds 10% of excess liquid capital. For purposes of this Item,
excess liquid capital at the end of the prior month may be used.
5. Aggregate and report in one total on line 30(b) those amounts calculated in (3) above for each commodity which exceed 10% of excess
liquid capital. For purposes of this item, excess liquid capital at the end of the prior month may be used.
d. Commodity Concentration - Others - Report concentrations in commodity futures carried for all non-customers, omnibus and general
partners’ accounts calculated as follows:
1. Determine the greater of the total number of long or short commodity futures in each commodity. Positions in each account representing
purchases and sales of a like amount of the same commodity or hedges of spot (cash) commodities where the spot commodity is in the
possession or under the control of the government securities broker or dealer may be eliminated.
2. Determine the greatest original margin requirement for each commodity stipulated by a registered U.S. Commodity Exchange for
speculative accounts. If the commodity exchange has no original margin requirement, use the clearing house margin requirement.
3. Determine the total amount of margin that would be required as per (2) above on the greater of the total number of long or short positions
in each commodity as per (1) above.
4. For each commodity calculated as per (3) above, determine whether it exceeds 50% of excess liquid capital. For purposes of this item,
excess liquid capital as of the end of the prior month may be used.
5. Aggregate and report in one total on line 30(c) those amounts calculated in (3) above for each commodity which exceed 50% of excess
liquid capital. For purposes of this item, excess liquid capital as of the end of the prior month may be used.
30. Total Tickets - Enter the total number of buy and sell tickets executed as agent and/or principal, including tickets for repurchase and reverse
repurchase transactions. For agency transactions, count both the street and the customer side as one transaction. Multiple executions at the
same price which result in one confirmation should be counted as one transaction. In the case of principal transactions, dealer-to-dealer and
retail transactions are counted separately. Firms carrying public customer accounts for other brokers or dealers on a fully-disclosed basis are to
include transactions emanating from those accounts in their total ticket count. Firms which introduce accounts on a fully-disclosed basis should
include transactions so introduced in their ticket count. Exclude from total ticket counts transactions executed on behalf of monthly investment
plans and those filed on a subscription basis wherein payment is made directly to an underwriter, sponsor or other distributor who in turn
delivers the security purchased directly to the subscriber. This item corresponds to the same item number on Part ll.
31. Aged Fails - Enter the ledger balances of (a) fails-to-deliver and (b) fails-to-receive aged five (5) business days or more (21 business days or
more for municipal securities) following settlement date.
32. Total Fails
a. Report the total contract value of all fails-to-deliver. Enter here the total amount of all government securities broker or dealer receivables.
This item corresponds to the same number on Part ll.
b. Report the total contract value of all fails-to-receive. Enter here the total amount payable by the government securities broker or dealer. This
item is equal to the sum of items 1490 and 1500 on Part ll.
33. Clearing Agency Balances
a. Report the total dollar amount due from clearing agencies on current short positions at current prices as per the clearing agency.
b. Report the total dollar amount due to clearing agencies on current long positions at current prices as per the clearing agency.
34. Unrestricted Cash - Report all cash on hand and cash in banks subject to immediate withdrawal net of overdrafts. This would exclude cash
segregated in accordance with federal or state securities or commodities law.
35. Customers’ Accounts
a. Report the total amount of secured debits in customer accounts as of the month-end reporting date. This item corresponds to the same item
number on Part II.
b. Enter the total amount of all customers’ free and other credit balances as defined in Rule 15c3-3, subparagraphs (a)(8) and (a)(9) as modified
by 17 CFR 403.4.
36. Securities Borrowed - Enter the total market value of all securities borrowed from customers and non-customers including other government
securities brokers or dealers, registered broker-dealers, and financial and non-financial institutions.

Page 3

Form G-405 Part I

NAME OF GOVERNMENT SECURITIES BROKER OR DEALER

Schedule
A

NAME AND TELEPHONE NO. OF PERSON COMPLETING THIS REPORT

SEC. FILE NO.

ID NO.

(YYYY)
FOR MONTH ENDS
(IN THOUSANDS – $000’s OMITTED)

ITEM
1710

1. Subordinated Loan Agreements - Cash

1730

2. Secured Demand Notes - Face Amount

3520

3. Total Subordinations Allowable for Liquid Capital

3501

4. Ownership Equity/Partnership Capital - Start of Month

3950

b. Other Gross Income (or Loss)

4201

c. Expenses

4221

d. Federal Income Taxes

4264
4274

FEB

MAR

APR

MAY

JUN

5. Unconsolidated Income/Expense for the Month:
a. Trading and Investment Account Profit (or Loss)

4212

4250

JAN

6. Net Profit (or Loss) for the Month
7. Other (Exclude Non-Conforming Capital)
a. Additions to Capital
b. Deductions from Capital

3500

8. Ownership Equity/Partnership Capital - End of Month

3525

9. Other Deduction or Allowable Credits

3530

10. Total Capital and Allowable Subordinations

3550

11. Added Charges - Customer and Non-CustomerSecurities Accounts

3575

12. Operational Deductions from Liquid Capital
(Schedule B, Line 8)

3540

13. Non-Allowable Assets (Not Includable Above)

3612

14. Other Charges and/or Deductions

3620

15. Total Deductions and/or Charges (Lines 11 through 14)

3640

16. Liquid Capital

3740

17. Total Haircuts

3750

18. Liquid Capital Less Haircuts

Page 4

Form G-405 Part I

NAME OF GOVERNMENT SECURITIES BROKER OR DEALER

Schedule
A

NAME AND TELEPHONE NO. OF PERSON COMPLETING THIS REPORT

ID NO.

(YYYY)
FOR MONTH ENDS
(IN THOUSANDS – $000’s OMITTED)

JUL

AUG

SEP

OCT

NOV

SEC. FILE NO.
98

ITEM

DEC

1. Subordinated Loan Agreements - Cash

1710

2. Secured Demand Notes - Face Amount

1730

3. Total Subordinations Allowable for Liquid Capital

3520

4. Ownership Equity/Partnership Capital - Start of Month

3501

5. Unconsolidated Income/Expense for the Month:
a. Trading and Investment Account Profit (or Loss)

4212

c. Expenses

4201

d. Federal Income Taxes

4221

6. Net Profit (or Loss) for the Month

4250

7. Other (Exclude Non-Conforming Capital)
a. Additions to Capital

4264

b. Deductions from Capital

Page 5

3950

b. Other Gross Income (or Loss)

4274

8. Ownership Equity/Partnership Capital - End of Month

3500

9. Other Deduction or Allowable Credits

3525

10. Total Capital and Allowable Subordinations

3530

11. Added Charges - Customer and Non-CustomerSecurities Accounts

3550

12. Operational Deductions from Liquid Capital
(Schedule B, Line 8)

3575

13. Non-Allowable Assets (Not Includable Above)

3540

14. Other Charges and/or Deductions

3612

15. Total Deductions and/or Charges (Lines 11 through 14)

3620

16. Liquid Capital

3640

17. Total Haircuts

3740

18. Liquid Capital Less Haircuts

3750

Form G-405 Part I

NAME OF GOVERNMENT SECURITIES BROKER OR DEALER

Schedule
A

NAME AND TELEPHONE NO. OF PERSON COMPLETING THIS REPORT

SEC. FILE NO.

ID NO.

(YYYY)
FOR MONTH ENDS
(IN THOUSANDS – $000’s OMITTED)

ITEM
4880
4881
1011
3760
3850
3770
4430
4472
4530
850
1620
841
1621
3551
5371
5372

19.
20.
21.
22.

JUN

b. Short - All Securities
c. Long - Contractual Commitments - GNMA’s, etc.
d. Short - Contractual Commitments - GNMA’s, etc.
28. Customer and Non-Customer Charges - GNMA’s, etc.
29. Security Concentration/Commodity Concentration
a. Security Concentration - Firm
b. Security Concentration - Customer

4980

30. Total Tickets

5362

31. Aged Fails:

a. To Deliver
b. To Receive

5365
32. Total Fails:

a. To Deliver
b. To Receive

1505

33. Clearing Agency Balances
a. Due from Clearing
b. Due to Clearing

750

34. Unrestricted Cash

310

35. Customers’ Accounts
a. Secured Debits

103

MAY

27. Firm Proprietary Positions
a. Long - All Securities

c. Commodity Concentration - Firm

1580

APR

24. Total Credits - Rule 15c3-3 Reserve Formula
25. Total Debits - Rule 15c3-3 Reserve Formula - Net
26. Amount in Reserve Bank Account

d. Commodity Concentration - Others

1560

MAR

b. Liquid Capital in Excess of Minimum Requirement
(Line 22)

5376

810

FEB

23. Ratio/Excess Liquid Capital
a. Liquid Capital to Total Haircuts

5375

770

JAN

Scheduled Capital Withdrawals Within 6 Months
Liquid Capital After Withdrawals
Total Equity Subordinations
Minimum Capital Requirement

b. Total Credits
36. Securities Borrowed

Page 6

Form G-405 Part I

NAME OF GOVERNMENT SECURITIES BROKER OR DEALER

Schedule
A

NAME AND TELEPHONE NO. OF PERSON COMPLETING THIS REPORT

(YYYY)
FOR MONTH ENDS
(IN THOUSANDS – $000’s OMITTED)

JUL

AUG

SEP

OCT

NOV

SEC. FILE NO.

ID NO.

ITEM

DEC
19.
20.
21.
22.

Scheduled Capital Withdrawals Within 6 Months
Liquid Capital After Withdrawals
Total Equity Subordinations
Minimum Capital Requirement

23. Ratio/Excess Liquid Capital
a. Liquid Capital to Total Haircuts
b. Liquid Capital in Excess of Minimum Requirement
(Line 22)
24. Total Credits - Rule 15c3-3 Reserve Formula
25. Total Debits - Rule 15c3-3 Reserve Formula - Net
26. Amount in Reserve Bank Account
27. Firm Proprietary Positions
a. Long - All Securities

3850
3770
4430
4472
4530

b. Short - All Securities
c. Long - Contractual Commitments - GNMA’s, etc.
d. Short - Contractual Commitments - GNMA’s, etc.
28. Customer and Non-Customer Charges - GNMA’s, etc.

850
1620
841
1621
3551

29. Security Concentration/Commodity Concentration
a. Security Concentration - Firm

5371

b. Security Concentration - Customer

5372

c. Commodity Concentration - Firm

5375

d. Commodity Concentration - Others

5376

30. Total Tickets
31. Aged Fails:
32. Total Fails:

4980
a. To Deliver

5362

b. To Receive

5365

a. To Deliver

770

b. To Receive

1505

33. Clearing Agency Balances
a. Due from Clearing
b. Due to Clearing
34. Unrestricted Cash
35. Customers’ Accounts
a. Secured Debits
b. Total Credits
36. Securities Borrowed

Page 7

4880
4881
1011
3760

810
1560
750
310
1580
103

Form G-405 Part I

Name of Government Securities Broker or Dealer

Schedule
B

Name and Telephone No. of Person Completing This Report

ID No.

SEC File No.

OPERATIONAL DEDUCTIONS
FROM LIQUID CAPITAL
(NOTE A)

FEBRUARY

JANUARY
I

III

IV**

CREDITS
(LONG
VALUE)

DEDUC
TIONS IN
COMPUT
ING
LIQUID
CAPITAL

NO. OF
ITEMS

DEBITS
(SHORT
VALUE)

I
NO. OF
ITEMS

DEBITS
(SHORT
VALUE)

III

IV**

CREDITS
(LONG
VALUE)

DEDUC
TIONS IN
COMPUT
ING
LIQUID
CAPITAL

1. Money suspense and balancing
differences
2. Security suspense and differences with
related money balances

L
S

3. Market value of short and long security
suspense and differences without related
money (other than reported in item 4 below)
4. Market value of security record breaks
5. Unresolved reconciling differences with
others
A. Correspondents and brokers or dealers

L
S

B. Depositories
C. Clearing organizations

L
S

D. Inter-company accounts
E. Banks-accounts and loans
F. Other
G. (Offsetting) Items A-F

TOTAL Line 5
6. Commodity suspense differences
unresolved
7. Open transfers and reorganization account
items over 40 days not confirmed or verified

8. TOTAL (Lines 1 through 7)
9. Lines 1 through 6 resolved subsequent to
report date
10. Has respondent completed this form in
accordance with instructions of the
designated examining authority?

Yes

**All line items ((1 through 8) Columns I, II, III and IV, if required) must be answered. If respondent has nothing to report, enter -0-.
Note A: Include aged items which resulted in a deduction in the computation of liquid capital (Column IV) at the report date as appropriate (Lines 1 through 7)
whether resolved subsequently or not (see instructions). Complete Columns I, II and III only if required by the “designated examining authority.”
OPERATIONAL EXPOSURE ITEMS (Note B)
Note B: The respondent’s “designated examining authority” may require on a separate schedule headed “Potential Operational Deductions from Liquid Capital”
that the same information be submitted, as formatted above, for line items 1 through 6 stating open items at the report date that were not deducted in
the computation of liquid capital, and which were not resolved in seven (7) business days subsequent to the report date.

Page 8

Form G-405 Part I

Name of Government Securities Broker or Dealer

Schedule
B

Name and Telephone No. of Person Completing This Report

ID No.

SEC File No.

OPERATIONAL DEDUCTIONS
FROM LIQUID CAPITAL
(NOTE A)

APRIL

MARCH
I

III

IV**

CREDITS
(LONG
VALUE)

DEDUC
TIONS IN
COMPUT
ING
LIQUID
CAPITAL

NO. OF
ITEMS

DEBITS
(SHORT
VALUE)

I
NO. OF
ITEMS

DEBITS
(SHORT
VALUE)

III

IV**

CREDITS
(LONG
VALUE)

DEDUC
TIONS IN
COMPUT
ING
LIQUID
CAPITAL

1. Money suspense and balancing
differences
2. Security suspense and differences with
related money balances

L
S

B. Depositories
C. Clearing organizations

L
S

D. Inter-company accounts
E. Banks-accounts and loans
F. Other
G. (Offsetting) Items A-F

TOTAL Line 5
6. Commodity suspense differences
unresolved
7. Open transfers and reorganization account
items over 40 days not confirmed or verified

8. TOTAL (Lines 1 through 7)
9. Lines 1 through 6 resolved subsequent to
report date
10. Has respondent completed this form in
accordance with instructions of the
designated examining authority?

Yes

Page 9

Form G-405 Part I

Name of Government Securities Broker or Dealer

Schedule
B

Name and Telephone No. of Person Completing This Report

ID No.

SEC File No.

OPERATIONAL DEDUCTIONS
FROM LIQUID CAPITAL
(NOTE A)

JUNE

MAY
I

III

IV**

CREDITS
(LONG
VALUE)

DEDUC
TIONS IN
COMPUT
ING
LIQUID
CAPITAL

NO. OF
ITEMS

DEBITS
(SHORT
VALUE)

I
NO. OF
ITEMS

DEBITS
(SHORT
VALUE)

III

IV**

CREDITS
(LONG
VALUE)

DEDUC
TIONS IN
COMPUT
ING
LIQUID
CAPITAL

1. Money suspense and balancing
differences
2. Security suspense and differences with
related money balances

L
S

B. Depositories
C. Clearing organizations

L
S

D. Inter-company accounts
E. Banks-accounts and loans
F. Other
G. (Offsetting) Items A-F

TOTAL Line 5
6. Commodity suspense differences
unresolved
7. Open transfers and reorganization account
items over 40 days not confirmed or verified

8. TOTAL (Lines 1 through 7)
9. Lines 1 through 6 resolved subsequent to
report date
10. Has respondent completed this form in
accordance with instructions of the
designated examining authority?

Yes

Page 10

Form G-405 Part I

Name of Government Securities Broker or Dealer

Schedule
B

Name and Telephone No. of Person Completing This Report

ID No.

SEC File No.

OPERATIONAL DEDUCTIONS
FROM LIQUID CAPITAL
(NOTE A)

AUGUST

JULY
I

III

IV**

CREDITS
(LONG
VALUE)

DEDUC
TIONS IN
COMPUT
ING
LIQUID
CAPITAL

NO. OF
ITEMS

DEBITS
(SHORT
VALUE)

I
NO. OF
ITEMS

DEBITS
(SHORT
VALUE)

III

IV**

CREDITS
(LONG
VALUE)

DEDUC
TIONS IN
COMPUT
ING
LIQUID
CAPITAL

1. Money suspense and balancing
differences
2. Security suspense and differences with
related money balances

L
S

B. Depositories
C. Clearing organizations

L
S

D. Inter-company accounts
E. Banks-accounts and loans
F. Other
G. (Offsetting) Items A-F

TOTAL Line 5
6. Commodity suspense differences
unresolved
7. Open transfers and reorganization account
items over 40 days not confirmed or verified

8. TOTAL (Lines 1 through 7)
9. Lines 1 through 6 resolved subsequent to
report date
10. Has respondent completed this form in
accordance with instructions of the
designated examining authority?

Yes

Page 11

Form G-405 Part I

Name of Government Securities Broker or Dealer

Schedule
B

Name and Telephone No. of Person Completing This Report

ID No.

SEC File No.

OPERATIONAL DEDUCTIONS
FROM LIQUID CAPITAL
(NOTE A)

OCTOBER

SEPTEMBER
I

III

IV**

CREDITS
(LONG
VALUE)

DEDUC
TIONS IN
COMPUT
ING
LIQUID
CAPITAL

NO. OF
ITEMS

DEBITS
(SHORT
VALUE)

I
NO. OF
ITEMS

DEBITS
(SHORT
VALUE)

III

IV**

CREDITS
(LONG
VALUE)

DEDUC
TIONS IN
COMPUT
ING
LIQUID
CAPITAL

1. Money suspense and balancing
differences
2. Security suspense and differences with
related money balances

L
S

B. Depositories
C. Clearing organizations

L
S

D. Inter-company accounts
E. Banks-accounts and loans
F. Other
G. (Offsetting) Items A-F

TOTAL Line 5
6. Commodity suspense differences
unresolved
7. Open transfers and reorganization account
items over 40 days not confirmed or verified

8. TOTAL (Lines 1 through 7)
9. Lines 1 through 6 resolved subsequent to
report date
10. Has respondent completed this form in
accordance with instructions of the
designated examining authority?

Yes

Page 12

Form G-405 Part I

Name of Government Securities Broker or Dealer

Schedule
B

Name and Telephone No. of Person Completing This Report

ID No.

SEC File No.

OPERATIONAL DEDUCTIONS
FROM LIQUID CAPITAL
(NOTE A)

DECEMBER

NOVEMBER
I

III

IV**

CREDITS
(LONG
VALUE)

DEDUC
TIONS IN
COMPUT
ING
LIQUID
CAPITAL

NO. OF
ITEMS

DEBITS
(SHORT
VALUE)

I
NO. OF
ITEMS

DEBITS
(SHORT
VALUE)

III

IV**

CREDITS
(LONG
VALUE)

DEDUC
TIONS IN
COMPUT
ING
LIQUID
CAPITAL

1. Money suspense and balancing
differences
2. Security suspense and differences with
related money balances

L
S

B. Depositories
C. Clearing organizations

L
S

D. Inter-company accounts
E. Banks-accounts and loans
F. Other
G. (Offsetting) Items A-F

TOTAL Line 5
6. Commodity suspense differences
unresolved
7. Open transfers and reorganization account
items over 40 days not confirmed or verified

8. TOTAL (Lines 1 through 7)
9. Lines 1 through 6 resolved subsequent to
report date
10. Has respondent completed this form in
accordance with instructions of the
designated examining authority?

Yes

Page 13

Form G-405 Part I

REPORT ON FINANCES AND

OPERATIONS OF GOVERNMENT

SECURITIES BROKERS AND DEALERS

INSTRUCTIONS

Schedule B—Supplemental Report

Operational Capital Charge Items

General - For reporting purposes the debit (short value) Column ll and credit (long value) Column lll should be rounded to the nearest one
thousand dollars ($000 omitted). Omit pennies in Column IV.
Complete Columns I, Il, and lll of the schedule only if required by your designated examining authority.
Include on lines 1 through 7 all items that are, or result in, capital charges at the report date even if resolved subsequently. Items resolved
subsequent to the report date may be shown on line 9 at the option of the respondent unless specifically required by the examining authority or
as noted herein.
All commodity money suspense differences and uncompared and unconfirmed items should be reported on line 6 only.
If the designated examining authority requires completion of Columns l, ll and lll, all aged operational items (lines 1 through 7) are reportable
whether they result in a capital charge or not.
If more than one item is reportable for each line the aggregate number of items should be reported in Column I. The related aggregate amount
(values) are reportable in Columns ll, lll and IV if required. A related money and security value should be considered as one item.
Suspense and reconciliation difference items may not be updated by transfer, journal entry or otherwise, to another account with a different
nomenclature. Each item must retain its original discovery date unless clearly identified with another item.
Suspense Differences (relative to lines 1, 2, 3 and 4) - The liquid capital treatment of suspense differences is as follows:
The liquid capital treatment of security positions and money balances whose ultimate disposition is not known, e.g., DKs and suspense items
which remain unresolved seven (7) business days after discovery, is as follows:
1) Long position and related debit balance, and short position and related credit balance - treat as proprietary commitments that cannot
operate to increase liquid capital (see line 2 instructions);
2) Long position only - no deduction except as noted herein (see line 3 instructions);
3) Short position and breaks only - deduct current market value (Rule 15c3-1(c)(2)(v)) (see treatment of security count differences below
and lines 3 and 4 instructions);
4) Credit balance only - no deduction; and
5) Debit balance only - deductions (see line 1 instructions).
The resolution of suspense or difference items after the report date shall not result in a reduction of the required charge as of the report date.
For example, a short security difference which is open at the report date and has been unresolved for seven (7) business days after discovery
is required to be deducted even though the difference is resolved prior to the date the Form G-405 is filed.
Security Count Differences (relative to lines 2, 3, 4 and 5) - Rule 17a-13 as modified by 17 CFR 404.5 (Quarterly Security Count
Requirements) requires unresolved differences to be recorded in a difference account no later than seven (7) business days following the
security count and verification. Paragraph (b)(3) of the rule as modified requires verification of all securities in transfer, in transit, pledged,
loaned, borrowed, deposited, failed to receive and deliver, subject to repurchase or reverse repurchase agreements, or otherwise subject to the
government securities broker’s or dealer’s control or direction but not in his physical possession where such securities have been in said status
for longer than 30 days. With respect to these items requiring verification, the seven (7) day period begins after verification takes place; that is,
when a confirmation is returned indicating a discrepancy with the books and records of the government securities broker or dealer, or where
such confirmations have not been returned within a reasonable period of time (15 days) to establish the validity of the position. In instances
where confirmations have been outstanding for 15 business days without return, the government securities broker or dealer should record as a
difference such securities on the 22nd business day.

Page 14

Form G-405 Part I

Specific Line Item Instructions
Line 1. Money suspense and balancing differences (money only) - These differences shall include any amount required to balance the
general ledger and unresolved differences between general ledger control accounts and subsidiary records or balancing of blotters, etc.
A “debit” difference is one that, if recorded in the general ledger, would result in a debit balance. This may result because of an amount
needed to balance excess ledger credits over ledger debits or as a result of adjusting general ledger control accounts to subsidiary records.
Report debit differences in Columns II and IV.
A “credit” difference is one that, if recorded in the general ledger, would result in a credit balance. This may result because of an amount
needed to balance excess ledger debits over ledger credits or as a result of adjusting general ledger control accounts to subsidiary records.
Report credit differences in Column III only.
Money suspense and balancing differences shall also include all accounts, in whole or part, containing ledger debits or credits representing
unidentified or unknown items with no related security position or an account which may contain security positions that cannot be properly
related to the money ledger balances.
Money differences could include, but are not limited to the following:
a. Unallocated receipts or disbursements.
b. Cash Dividend Balancing Accounts (out-of-balance proofs).
c. Money Balancing Accounts (EDP), Cage, P&S, Accounting and others.
d. Unresolved Money Differences resulting from the comparison of detail records to control accounts for customer accounts, fail-to-receive,
fail-to-deliver, stock borrowed, stock loaned, bank loans, inter-office accounts and adjustments of general ledger control accounts to
agree to subsidiary records.
e. Any accounts utilized to balance “daily work” which contain debits or credits requiring resolution. If any such accounts exist, the Iedger
balance resulting from one day’s “out-of-balance” work shall not be netted against another day’s “out-of-balance” work, unless related to
each other.
For reporting purposes, debit and credit money differences shall not be netted.
Line 2. Securities differences with related money balances - Report in Columns I, II, and III all transactions in any accounts containing a
long or short security position with a related ledger balance pending determination of ownership, collectibility, or deliverability, which are in
doubt.
Long positions and related debits, and short positions and related credits are treated as proprietary commitments in computing liquid capital if
they remain unresolved seven (7) business days after discovery. This requires mark-to-market adjustments and haircut charges computed
under 17 CFR 402.2(g) and Appendix A thereto. The aggregate total of deductions is reportable in Column IV and shall not operate to
increase liquid capital.
Line 3. Market value of short and long suspense and differences without related money - Shall include all transactions in any accounts
containing long and short security positions, for which no related ledger balance exists regardless of the nomenclature of the account.
Long differences are generally ignored in the capital computation process unless the securities have been sold by the government securities
broker or dealer before the differences are adequately resolved. In such instances, include the excess of the market value (Column III) of the
long securities sold over any reserve established as a deduction in Column IV.
The market value of short security differences is deducted in the computation of liquid capital if the differences remain unresolved seven (7)
days after discovery (see Rule 15c3-1(c)(2)(v)), and should be reported in Columns II and IV.
Unrelated differences in the same security or other securities shall not be netted.
Line 4. Market value of security record breaks - Security record breaks are defined as out-of-balance error conditions in the daily recording
of security position changes or movements where the total longs do not equal the total shorts on a given security.
“Long” differences are the amounts needed to balance an excess of short positions over long positions. When recorded in a difference
account, such would be recorded long on the stock record.
“Short” differences are the amounts needed to balance an excess of long positions over short positions. When recorded in a difference
account, such would be recorded short on the stock record.
Security record breaks resulting from one day’s “out-of-balance” shall not be netted against another day’s “out-of-balance” work unless
research specifically discloses that it is the proper resolution of particular differences.

Page 15

Form G-405 Part I

The day of discovery for security record breaks should be the day following any movement in a security and may not be updated by transferring
the break to a suspense or difference account unless related to some other clearly identifiable item of suspense or difference item.
The market value of long security record breaks unresolved seven (7) business days after discovery should be reported in Column III.
The market values of short security record breaks are deductions in the computation of liquid capital if they remain unresolved seven (7) days
after discovery (see Rule 15c3-1(c)(2)(v)), and should be reported in Columns II and IV.
Unrelated security breaks in the same or other securities shall not be netted.
Line 5. Unresolved reconciling differences with others - The respondent shall report in Column IV the total net overall unfavorable aged
reconciling differences disclosed by reconciliations (Lines 5A-F) which are required to be deducted in computing liquid capital. Each
government securities broker or dealer having any such differences shall maintain a record of the date of receipt of the pertinent statement of
account or, in the absence of such record, shall compute the elapsed days (aging) from the date of the statement. The treatment of differences
disclosed by reconciliations required under Rule 17a-13 as modified by 17 CFR 404.5 shall be governed by the requirements of that rule as
modified.
Differences which have been resolved but which have not yet been appropriately corrected in the records shall be so identified on the
reconciliations and may be considered resolved for purposes of computing liquid capital. Unresolved favorable and unfavorable differences
with the same carrying entity may be netted for purposes of determining the deductions in computing liquid capital.
Debit amounts and short values (Column II) or credit amounts and long values (Column III) applicable to all unresolved reconciling items
should be reported broad and not netted. Offsetting favorable and unfavorable differences by the same carrying entity should be reported on
line 5G as a deduction in Columns II and III.
Line 6. Commodity suspense differences unresolved - Report on this line all unresolved commodity differences or suspense items as a
result of internal balancing of records, and comparison of the government securities broker’s or dealer’s books of accounts with the records of
clearing organizations and others. Such items would include:
1. Customer, non-customer, omnibus and proprietary accounts.
2. Ledger balances and realized and unrealized gains and losses relating to long and short positions in spot (cash) commodities, forward
contracts in commodities and futures contracts.
Report in Column II aggregate total debits, unrealized losses or short values and in Column III credits, unrealized gains or long values
relating to deductions from liquid capital. The aggregate deduction from liquid capital is reportable in Column IV; that is, losses which
would be incurred to correct unresolved recordkeeping differences, including differences with other entities as of the report date which
have not been resolved within time frames required, for firm, customer, non-customer, omnibus, clearing, and contract differences
accounts.
In determining data to be included in the report, the following schedule may be used. It should be noted that this schedule may not be allinclusive. Other suspense items not included in this schedule should also be reported on Line 6.

a. Clearing Accounts with Commodity Clearing Organizations:
1. Number and amount of unresolved reconciling money items:
a. Debits

No.:

b. Credits No.:

2. Gain or loss in unresolved futures contract differences after comparison and balancing with proprietary and other positions:
a. Gain

b. Loss

b. Clearing Accounts with Commodity Brokers and Dealers:
1. Number and amount of unresolved reconciling money items:
a. Debits

No.:

b. Credits No.:

Page 16

Form G-405 Part I

2. Gain or loss in unresolved futures contract differences after comparison and balancing with proprietary positions:
a. Gain

b. Loss

c. Other Gains and Losses in Forward or Futures Contracts:
Unresolved Differences:
a. Debits

b. Credits $
d. Warehouse Receipts on Hand:
1. Number of unresolved differences
2. Market value of unresolved differences
Long (Short)

Line 7. Open transfers and reorganization items over 40 days not confirmed or verified - The term “reorganization account” shall include,
but not be limited to, transactions in the following:
(a) “rights” subscriptions
(b) warrants exercised
(c) stock splits
(d) redemptions
(e) conversions
(f) exchangeable securities
(g) spin-offs.
See general comment relative to the verification of transfers and reorganization items in connection with quarterly counts and time frames
pursuant to Rule 17a-13 as modified by 17 CFR 404.5 for considering charges to capital.
Line 8. Total of lines 1 through 7; the total in Column IV should be entered here and on line 12 of Part I, page 2 or 3.
Line 9. This line item may be used, at the option of the respondent or as required by the designated examining authority, to report items (lines
1 through 6) subsequently resolved up to the filing date of the Form G-405.

Public reporting burden for this collection of information is estimated to average 12 hours
per response, including the time for reviewing instructions, searching existing data sources,
gathering and maintaining the data needed, and completing and reviewing the collection of
information. Send comments regarding this burden estimate or any aspect of this collection of
information, including suggestions for reducing this burden to: Bureau of the Fiscal Service,
Government Securities Regulations Staff, 3201 Pennsy Drive, Building E, Landover, MD
20785-1603; and to the Office of Management and Budget, (1530-0064) Washington, DC 20503.

Page 17

Form G-405 Part I

File Type	application/pdf
File Title	G-405Part1 (4/02)
Author	Cameron Kouns
File Modified	2018-04-12
File Created	2003-02-04