Haw. Code R. § 16-38-5.3 - Registration; financial requirements

(a) Every registered dealer shall file an annual report of condition within ninety days following the end of the calendar or fiscal year adopted as follows:

(1) Dealers registered under the Securities Exchange Act shall file a copy of the annual financial report filed with the SEC; and

(2) All other dealers shall file a balance sheet certified by an independent public accountant in conformance with generally accepted accounting principles and that evidences the dealer's compliance with the requirements of subsection (b).

(b) A dealer that is subject to subsection (a)(2) shall have at all times a minimum net capital of not less than $5,000. As used in this section, "net capital" shall mean net worth, or the difference between total assets and total liabilities or indebtedness, after adjustment to eliminate or revise assets of doubtful or uncertain value and to reflect true liabilities, in accordance with the following schedule:

(1) Asset items not allowable:

(A) Furniture, fixtures, and equipment; and

(B) Intangible items, such as goodwill, prepaid preincorporation, or organizational expenses, etc.;

(2) Asset items to be adjusted or substantiated:

(A) Securities owned shall be adjusted to market value;

(B) Value of real estate shall be attested to by qualified and disinterested persons;

(C) Property in joint ownership shall be limited to applicant's interest therein; and

(D) Value of unsecured notes, accounts receivable, or advanced commissions due from a salesperson, officer, director, partner, or affiliate may be required by the commissioner to be substantiated by an opinion of a bank, finance company, or other lending institution satisfactory to the commissioner.

Notes

Haw. Code R. § 16-38-5.3

[Eff 6/4/70; am 1/1/71; am and ren § 16-38-5, 7/30/81; am, ren § 16-38-5.3 and comp 10/12/85; am and comp 4/14/03] (Auth: HRS § 485-2) (Imp: HRS § 485-14)