FOCUS Report Hub International Investment Services Inc.

X-17A-5 - FOCUS Report

Published: 2017-03-01 10:00:58
Submitted: 2017-03-01
Period Ending In: 2016-12-31
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X-17A-5: Filer Information

X-17A-5: Submission Information

X-17A-5: A. Registrant Identification

Address of Principal Place of Business (Do not use P.O. Box No.)

Address 1
2393 TOWNSGATE ROAD, SUITE 101
City
WESTLAKE VILLAGE
State/Country
CALIFORNIA
Mailing Zip/ Portal Code
91361-2513

Name and Telephone Number of Person to Contact in Regard to this Report

Name
Christine Bazzini
Telephone Number
5303334810

X-17A-5: B. Accountant Identification

Independent Public Accountant

X-17A-5: Signature

Oath or Affirmation

I, Denise Scher, swear (or affirm) that, to the best of my knowledge and belief the accompanying financial statement and supporting schedules pertaining to the firm of HUB INTERNATIONAL INVESTMENT SERVICES INC., as of 12-31-2016, are true and correct. I further swear (or affirm) that neither the company nor any partner, proprietor, principal officer or director has any proprietary interest in any account classified solely as that of a customer, except as follows:

Notary Public

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Header Data

Submission Type
X-17A-5

Filer Info

Filer Credentials

Filer Cik
0001462258
Filer Ccc
XXXXXXXX
Live Test Flag
LIVE

Flags

Return Copy Flag
true
Confirming Copy Flag
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Form Data

Submission Information

Period Begin
01-01-2016
Period End
12-31-2016
Type Of Registrant
Broker-dealer
Material Weakness
N

Registrant Identification

Broker Dealer Name
HUB INTERNATIONAL INVESTMENT SERVICES INC.
Contact Person Name
Christine Bazzini
Contact Person Phone Number
5303334810

Accountant Identification

Accountant Name
Crowe Horwalth LLP
Accountant Type
Certified Public Accountant

Oath Signature

Sign Person Name
Denise Scher
Entity Name
HUB INTERNATIONAL INVESTMENT SERVICES INC.
Sign Date
12-31-2016
Signature
Denise Scher
Oath Title
President
Confirm Notarized Flag
Y
hiispublic2.pdf PUBLIC AUDIT REPORT


                                                          UNITEDSTATES                                                   OMB APPROVAL
                                          SECURITIESANDEXCHANGECOMMISSION                                          OMB Number:        3235—0123
                                                     Washington, D.C. 20549                                        Expires:         May 31, 2017
                                                                                                                   Estimated average burden
 PUBLIC                                    ANNUAL AUDITED REPORT                                                   hours perresponse...... 12.00


                                                      FORP'\A’IRX'I:1"7|A-5                                                    SEC FILE NUMBER

                                                                                                                               868237
                                                           FACING PAGE
                  Information Required of Brokers and Dealers Pursuant to Section 17 of the
                         Securities Exchange Act of 1934 and Rule 17a—5 Thereunder

REPORT FOR THE PERIOD BEGINNING                  01/01/2016                            AND ENDING                 12/31/2016
                                                                MMIDDNY                                                   MM/DD/YY

                                        A. REGISTRANT IDENTIFICATION

NAME OF BROKER—DEALER:                  HUB International Investment Services, Inc.                                     OFFICIAL USE ONLY

ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use P.0. Box No.)                                                              FIAM I.D. NO.
2393 Townsgate Road, Suite 101
                                                             (No. and Street)
                        Westlake Village                              California                                   91361
                       (Ciy                                          (State)                                      (Zip Code)
NAME AND TELEPHONE NUMBER OF PERSON TO CONTACT IN REGARD TO THIS REPORT
Chvisine Bazzinl                                                   (s30) sss—40t0
                                                                                                                   (Area Code — Telcphone Number)
                                       B. ACCOUNTANT IDENTIFICATION

INDEPENDENT PUBLIC ACCOUNTANT whose opinionis contained in this Report*®
Crowe Horwath LLP
                                                 (Name— ifindividual, state last, first, middle name)
       1 Mid America Plaza, Suite 700 Oak Brook                                                         Iilinois                   60522—3697
      (Address)                                        (City)                                           (State)                    (Zip Code)


CHECK ONE:

          / Certified Public Accountant
                  Public Accountant

                  ‘Accountantnot resident in United States orany of its possessions.

                                                 FOR OFFICIAL USE ONLY




*Claims forexemption from the requirement that the annual report be covered by the opinion of an independent public accountant
must be supported by a statement offacts and cireumstances relied on as the basis for the exemption. See Section 240.174—5(e)(2)



                                  Potential persons who are to respond to the collection of
                                  Information contained in this form are not required to respond
   SEC 1410 (06—02)               unless the form displays a currently valid OMB control number.


                                               OATH OR AFFIRMATION

1, Denise Scher                                                                       , swear (or affirm) that, to the best of
my knowledge and belief the accompanying financial statement and supporting schedules pertaining to the firmof
HUB International InvestmentServices, Inc.                                                                                 , as
of December31                                             , 20 16    , are true and correct. T furtherswear(or affirm) that
neither the company nor any partner, proprietor, principal officer or director has any proprietary interest in any account
classified solely as that of a customer, except as follows:




                                                                    Whir
                                                                      Signature

                                                                    President
                                                                                       Title

                                                               SEE CALIFORNIA
                Notary Public                                       ‘>|)£       FORM

This report ** contains (check all applicable boxes):                ATTACHED DT\
K (a) Facing Page.
     (b)   Statement of Financial Condition.
C1   (c)   Statement of Income (Loss).
C1   (d)   Statement of Changes in Financial Condition.
C1   (e)   Statement of Changes in Stockholders® Equity or Partners® or Sole Proprictors® Capital.
C1   (f)   Statement of Changes in Liabilities Subordinated to Claims of Creditors.
C1 (g) Computation of Net Capital.
C1 (h) Computation for Determination of Reserve Requirements Pursuant to Rule 15¢3—3.
C1 (i) Information Relating to the Possession or Control Requirements Under Rule 15c3—3.
C1 (§) A Reconciliation, including appropriate explanation of the ComputationofNet Capital Under Rule 15c3—1 and the
       Computation for Determination of the Reserve Requirements UnderExhibit A of Rule 15c3—3.
C1 (k) A Reconciliation between the audited and unaudited Statements of Financial Condition with respect to methods of
       consolidation.
[¥ (1) An Oath or Affirmation.
C1 (im) A copy of the SIPC Supplemental Report.
C1 (n) A report describing any material inadequacies found to exist orfound to have existed since the date oftheprevious audit.

**For conditions of confidential treatment of certain portions of this filing, see section 240.17a—5(e)(3).


A notary public or other officer completing this
certificate verifies only the identity of the individual
who signed the document to which this certificate
is attached, and not the truthfulness, accuracy, or
validit of that document.

State of California
County of Los Anqeles

Subscribed and sworn to (or affirmed) before me on this    aBI1
day of t.2.!MI/:S    ,20f t, by \?wlS.          Sc.llfR
proved to me on the basis of sati sfactory evidence to be the
person(,j) who appeared before me.


                  HUB
      Hub International Investment Services Inc,
(A Wholly Owned Subsidiary of Hub International Limited)

             Repol't PlII'suant to Rule 17a-5(d)
                   Financial Statements

                 As of December 31 , 2016




              Available fol' Public Inspection


               Hub International Investment Services Inc.
         (A Wholly Owned Subsidiary of Hub International Limited)
                           Table of Contents



                                                                                     Page

Report of Independent Registered Public Accounting Firm........................        1

Financial Statements:
   Statement ofFinancial COAdiHIOA............cccceeeee enc 2

   Notes to the Statement of Financial Condition. ....................cccsceencno—     3


         Crowe Horwath.                                                            Crowo Horwath ll P
                                                                                   Independen1 Member CI'OWII Horwath International




               REPORT OF INDEPENDENT REGISTERED PUBLI C ACCOUNTING FIRM




To the Board of Directors and Shareholder of
 Hub International Investment Services Inc.


We have audited the accompanyi ng statement of financial condition of Hub International Investment
Services Inc. (the Company) as of December 31, 2016. This financial statement is the responsibility of the
Company's management. Our responsibility is to express an opinion on the financial statement based on
our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight
Board (United States). Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statement is free of material misstatement. An audit includes
examining , on a test basis, evidence supporting the amounts and disclosures in the financial statement.
An audit also includes assessing the accou nting principles used and significant estimates made by
management, as well as evaluating the overall financial statemen t presentation. We believe that our audit
provides a reasonable basis for our opinion.

In our opinion , the financial statement referred to above presents fairly, in all material respects, the
financial position of Hub International Investment Services Inc. as of December 31,2016 in conformity
with accounting principles generally accepted in the United States of America.




                                                        Crowe Horwath LLP

Oak Brook, Illinois
February 28, 2017


                    Hub International Investment Services Inc.
              (A Wholly Owned Subsidiary of Hub International Limited)
                         Statement of Financial Condition




                                                                                 As of
                                                                            December31,
                                                                                2016
                                   ASSETS
CURRENT ASSETS:
 C6Sh cmmmrnmmnmnmeremipemenrenrermenerenenrecmeserregeermenmeneremmaeren $          4,297,294
 Accounts receivable                                                                   858,162
 Prepaid expenses...                                                                    48.941
  Total current assets.                                                              5204,397
GOODWILL........                                                                     4496,895
OTHER INTANGIBLE ASSETS, net...                                                      7,903,196
NOTES RECEIVABLE—EMPLOYEES.                                                             90,686
  TOTAL ASSETS....... ... connmmnstnrermsemeeremeenme mresirennes                    17,695,174

        LIABILITIES AND SHAREHOLDER‘S EQUITY
CURRENT LIABILITIES:
 Accounts payable and accrued liabilities...                              .$           823,967
 Intercompany payable to Parent and Subsidiaries.                                      284.384
  Total current M@bilitieS..... ces ce cce ces                                        1,108,351
DEFERRED INCOME TAX LIABILITIES                                                        626,007
CONTINGENT EARNOUT CONSIDERATION PAYABLE                                                860,619
NOTE PAYABLE :.+ sn commmensnnenrrmmenqrrerencnessescrrne                              313,577
  FOFAL LIABILITIES:: 0 ommeommmommnerervcreemerenrnrrnreney                         2,908,644

SHAREHOLDER‘S EQUITY:
 Common shares, no par value; 1,000 shares authorized;
   100 issued and outstanding                                                              —
 Additional paid—in capital.....                                                     15,403,643
 ACCUMURIEd dfiCte .cesc en en ce en                                                   (617,113)
  TOTAL SHAREHOLDER‘S EQUITY,                                                        14,786,530
      TOTAL LIABILITIES AND SHAREHOLDER‘S EQUITY...                                  17,695,174




           The accompanying notes are anintegral part of this financial statement.


Note 1: Nature of Operations

Hub InternationalInvestment Services Inc., (the "Company‘, "we") is a financial services organization that offers
investmentsolutions for customers by conducting business as an introducing broker—dealer and investment advisor. The
Company also refers employee benefit plan customers or producers to a third—party broker—dealerto hold customer
accounts and effect transactions in securities on behalf of such customers. The Company was incorporated in thestate of
Delaware in 2007, and obtained a license to conduct opcrations on January 8, 2010. The Companyis a wholly owned
subsidiary of Hub International Limited (the "Parent"‘), a global insurance brokerage company, and is a memberof the
FinancialIndustry Regulatory Authority Inc. ("FINRA") and the Securities Investor Protection Corporation("SIPC®).
The investment advisoris registered with various state department entities.

Underits membership agreement with FINRA and the Securities and Exchange Act of 1934 ("Act") Rule 15c3—3(k)(2)(i)
promulgated pursuant to the Act, the Company conducts business ona fully disclosed basis and does not execute orclear
sccurities transactions for customers. The Company has engaged with third party broker—dealers that are responsible for
opening accounts and effecting transactions for such customers. Therefore, the Company is exempt fromthe requirement
ofRule 15c3—3 of the Act pertaining to the possession or control of customerassets and reserve requirements.

Note 2: Summary of Significant Accounting Policies

A.   Use ofestimates
The accompanying financial statements, and these notes, are prepared in accordance with accounting principles generally
accepted in the United States ("GAAP"). GAAP requires management to make estimates and assumptionsthat affect the
reported amounts of assets and liabilities and disclosureof contingentassets and liabilities at the date ofthefinancial
statements and the reported amountof revenues and expenses during the reporting period. Actualresults could differ
fromthose estimates.

B. Accounts Receivable
Uncollected commissions and advisory fees fromthe third party broker dealers are recorded as accounts receivable on our
balance sheets. Accounts receivableare stated net ofan allowance for uncollectible accounts. Due to the immaterial
natureof the Company‘s uncollectible commissions and advisory fees, an allowance for uncollectible accounts is not
deemed necessary.

C.. Goodwill and Intangible assets, net
Goodwill represents the excess of cost over fair value ofidentifiable net assets acquired through business acquisitions. In
accordance with ASC 350, Infangibles — Goodwill and Other, goodwill is not amortized, butinstead is reviewed for
impairment onat least an annual basis.

In evaluating the recoverability of the carrying value of goodwill we must make assumptions regarding the fair value of
the Company and determineif an indicator of goodwill impairment exists by comparing the carrying value of the
Company with the estimated fair value. If we determine that an indicator of goodwill impairment exists, we must then
quantify the actual goodwill impairment charge, if any, by comparing the carrying value of goodwill to its estimated fair
value, based onthe fair value of the Company‘s assets and liabilities as of the impairmenttest date. As of December 31,
2016, goodwill was deemed to not be impaired.

Intangible assets consist primarily of customerrelationships and are amortized overtheir useful life which is based on the
estimated timeframe over whichthe customerrelationship is expected to contribute to the Company‘s future cashflows.


In evaluating the carrying value ofintangible assets, the Company must determine if anindicator ofimpairment exists by
comparing the carrying value of the asset with the estimated fairvalue. If the carrying value ofthe intangible asset is
greater thanits fair value as of the impairment test date, the Company must record an impairmentcharge equal to the
calculated excess. As of December 31, 2016, intangible assets were deemedto not be impaired.

D. Income taxes
The Company files both the federal and state tax return on a consolidated basis with its Parent. The Company accounts
forits incometaxes using ASC 740, Income Taxes. ASC 740 requires the establishment ofa deferred tax asset or liability
to recognize the future tax effects of transactions that have not beenrecognized for tax purposes, including taxable and
deductible temporary differences as well as net operating loss and tax credit carry forwards.

The Company reducesthe carrying amount of deferred income tax assets, including the expected future benefit of
operating loss carry forwards by a valuation allowance if it is more likely than not that some portion of the deferred
income tax asset will not be realized. Interest or penalties related to incometax deficiencies are reported as a component
of incometaxes. As of December31, 2016 we performed our assessment of the realizability of deferred tax assets. Based
on the anticipated reversal patternof our taxable temporary differences, we believe ourdeferred tax assets are "more
likely than not"to be realized. Therefore, no valuation allowance is required.

Note 3: Business Acquisitions

During 2016 the Company acquired substantially all oftheassets of certain books of business for consideration of cash.
With these acquisitions, the Company has expandedits geographic footprint and investment products and services.
Goodwill arising from these acquisitionsis a result of expected synergies from combining operations and intangible assets
that do not qualify for separate recognition including the assembled workforce. To fund payments of these businesses the
Parent made capital contributions of $8.7 million in 2016. The purchase price allocation forouryear ended December 31,
2016 acquisitions are summarized in the table below:

                                                                             As of December31, 2016
                                                                  Parg        Norion       Pinnacle         Total
                                                                Advisors     Financial     Financial     Acquisitions
           Consideration paid:
            oe                                              . $1,200,000     $3,500,000    $3,240,000    $ 7940,000
             Contingent earnout consideration payable......        —             82046        778573        860,619
              Total purchase price...                       $1,200,000       $3,582.046    $4018.573     $ 8800,619
           Allocation of purchase price:
           Intangible assets:
             Goodwill..                                     .$     24948     $1,108,708    $ 1425,726    $ 2559382
             Customer relationships,                             1,045,000    2,267,000     2,383,000       5,695,000
             Broker dealer network                                  43,000       51,000        48,000         142,000
             Trade names.........                                   19,000       36,000        37,000         92,000
           Tangible assets:
             CUTONE ASSTS.. .. scenncenennrnnennnnenenn en         73733        181,401       183366         438,520
              Total assets acquired.                        ._$ 1,205,701    $3,644,109    $4,077,002    $ 8926902
             Noncurrentlabilities                                   501          62063         58,519       126283
              Total liabilties acquired.....                $       5201     $ 62063       $ s8.519      $   126283
                Net fair value of assets acquired.          ._$ 1,200,000    $3,582,046    $4,018,573    $ $,800,619

                DAtC Of AOQMISILION.. cce cecmccnnecnncnn cce     TROIG        10/1/2016     12/1/2016


The fair value adjustments for the customer relationship and brokerdealer network intangible assets were determined on
an excess cash flow method. The fair value adjustments forthe trade names were based ona relief from royalty method.
See Note 6, "Commitments and Contingencies"fora detailed discussion of contingent consideration arrangements and
liabilities in connection with the acquired business.

Note 4: Intangible Assets

Goodwill

In connection with certain of our acquisitions, we specifically identified Goodwill of $2,559,382. As of December31,
2016, the goodwill balance is $4,496,895.

We expect that approximately $1,919,437 of our total goodwill balance will be deductible forincome tax purposes in
future periods.

Other Intangible Assets                                                                                                      i
                                                                                                                             |
The carrying amount of other intangible assets as of December 31, 2016 are as follows:

                                                                Gross Carrying   Accumulated       Net Carrying
                                                                   Amount        Amortization        Amount
            Intangible assets subject to amortization:
             CustomerRelationships.                                  $204,882        (1,056.869)       748013
             Trade Names..                                             150,I61          (55.925)          24236
               Total intangible assets subject to amortizatio   $    8355013     $    1,112,790    $   7202209
            Indefinite—lived intangible assets:
              Trade Names..                                                                              518947
              Broker Dealer Network.                                                                     142,000
               Total indefinite—lived intangible assets.                                                 660,947
                 Total other intangible assets, net...                                                 7.903,196


In connection withcertain of our acquisitions, we specifically identified customerrelationship trade name intangible
assets subjectto amortization. Trade names are amortized on a straight—line basis overthe applicable estimated useful
life. The estimated useful life of the customer relationships and trade name assets recorded in connection with the
acquisitions ranges from6 years to 10 years and 2 years to 4 years, respectively.

We specifically identified our Hub International trade name as an indefinite—lived trade name. As of December 31, 2016,
the indefinite—lived trade nameis $518,947. In connection with certain of our 2016 acquisitions, we specifically
identified an indefinite—lived broker—dealer network intangible asset. As of December31, 2016, the indefinite—lived broker
dealer network is $142,000.

Note 5: Notes Payable and Receivable

On May 20, 2015, we entered into a $461,325 Promissory Note (the "Note") with a third party broker—dealer responsible
for opening accounts and effecting transactions forcertain customers of the Company (the "Lender"). The note matures
August 13, 2019 at a stated interest rate of zero unless an eventof default, as defined in the Note ("Eventof Default"),
occurs. In accordance with GAAP, interest has been accrued at an approximate market rate for similar transactions


(1.53% as of December31, 2016); upon an Event of Default, interest accrues starting on the date of default at an annual
rate of the lesserof 1) prime plus 6% or 2) the highest rate allowed underapplicable law.
As prerequisites to the Note, the Company agreed to certain covenants and restrictions and granted certain rights and
interests to the Lender and the Parent provided an unconditional guarantee on the Company‘s obligations.

The Note containsa forgiveness provision whereby the balance due is forgivenif certain agreed upon cumulative gross
commission and fee thresholds are met during the five year period ending on August 13, 2019. If the agreed upon
thresholds are not met during the aforementioned five year period and no Events of Default have occurred, the Company
has the option to either1) extend the Note by one yearin which the cumulative commission and fee thresholds for
forgiveness then become measured overa six yearperiod ending on August 13, 2020 or 2) repay a portion of the
outstanding balance based on the actual level of cumulative commissions and feesattained. If the Company repays the
portionof the outstanding balance based on the actual level of cumulative commissions and fees attained, the remaining
portion of the balance will be forgiven.

Upon occurrence of an Event of Default, the Lender may declare the note due immediately. No Events of Default
occurred as of or during the year ended December31, 2016.

Subsequent to entering into the Note, we entered into loan agreements totaling $181,524 with certain employees of the
Company (the "Employee Notes"). The Employee Notes mature on the same date ofand aresubject to the same interest
terms and similarconditions of default, forgiveness and other provisions contained in the Note.

The balances of the Note and the Employee Notes were $313,577 and $90,686, respectively, as of December31, 2016,
and the entire balances, not considering the Event of Default or forgiveness provisions, are due August 13, 2019.

Note 6: Commitments and Contingencies

In connection with business acquisitions, the Company entered into agreements with the sellers to pay considerationthat
is contingent on achieving certain financial performance measures in future periods. As of December 31, 2016, the
Company has $860,619 ofcontingent consideration, all of whichis considered long term, accrued on the Statement of
Financial Condition.

Changes in the amount of contingent earnout consideration during the yearending December31, 2016 are as follows:


                                                                                        Contingent
                                                                                   Earnout Liability
                       Balance, January 1, 2016                                     $        1,126,293

                        Business acquisitions                                                 860,619
                     Payments of contingent earnoutconsideration                            (1,094,830)
                     Changes in fair value of contingentearnoutlability.          ;            (31463)
                    Balance, December31, 2016.                                    .$           860,619


The fair value of contingent consideration was determined based on the Company‘s best estimate ofthepresent value of
the expected future earn—out payment. The fair value estimate of contingent consideration payable is based on
observations of historical operating trends for the acquired businesses and current market and economic conditions that
the Company believes may impact earnout variablessuchas revenue and operating profits. When estimating contingent
                                                             6


earnout consideration, we historically do not utilize a range of possible estimates but instead determine a reasonable point
estimate of expected future payments. The Company‘s best estimates ofcontingentearnout considerationliabilities are
generally updated on, at minimum, a quarterly basis to reflect current market and operating conditions.

Note 7: Income Taxes

The components of deferred tax assets and liabilities as of December31, 2016 are as follows:

                                                                                                         As of
                                                                                                      December 31,
                                                                                                         2016
                  Deferred tax asset:
                   Book vs. tax basis differente for FIXEd @SS@....... cce eenenceneenerenen ns $                454
                   Charitable contribution carryover                                                             795
                   Future state tax deduction                                                                     79
                    Acerued bonus..........                                                                   8979
                     Net—deBeTRHd (WK AORBLi on aovermies rreeremeemeererropererrersevevreriavarien          10,307
                  Deferred tax liability:
                   Book vs. tax basis difference for intangible assets                                     (625,156)
                   Prepaid insuranc                                                                         (11,248
                     Net deferred tax liability                                                            (636,404
                  TOWEdETENEI tX RABINY: : 10e no0rr e eceeree oo creesrerecerepcteerenrerseccee $         (626,097


In accordance with the relevant accounting guidance, the Company has determined that no reserveis required for
uncertain tax positions.

The companyis subject to U.S. federal income tax as well as various otherstate incometax. The Company is no longer
subject to examination by taxing authorities forthe years before 2013, withthe exception ofthe State of California, which
has a four year statute.

Note 8: Related Party Transactions

The Parent and the Parent‘s other wholly owned subsidiaries (the "Subsidiaries") administer day—to—day operations and
provide services to the Company such as humanresource, informationtechnology, record—keeping and clerical. In:
addition, the Parent and the Subsidiaries provide the Company‘s office space. In return,the Company pays the Parent and
the Subsidiaries for operating expenses incurred and paid on its behalf in accordance with an established service
agreement.


In 2015, we entered into loan agreements with certain employees of the Company; see Note 5 in these notes to our
financial statements for further discussion ofthese loans.

Note 9: Net Capital Requirements

The Companyis subject to the Uniform Net Capital Rule 15¢3—1 promulgated pursuant to the Act, which requires
maintaining a minimum net capital, and requires that the ratio ofaggregate indebtedness to net capital not to exceed 15


to 1. Net capital and aggregate indebtedness changes day to day, but as of December31, 2016, the net capital was
$1,090,116, of which $937,946 was in excess ofits required minimum net capital of$152,170. The ratio of aggregate
indebtedness to net capital as of December31, 2016 was 2.09.
Note 10: Subsequent Events

The Company has evaluated events occurring after December31, 2016 and has concluded that the following acquisitions
require disclosure. Effective January 1 and February 1, 2017, the Company acquired substantially all of the assets of
Hubbard Bert and Employees Research Group ("ERG"), respectively, for consideration of cash.

Due to the timing of the acquisitions, the allocation ofthe purchase price has not been determined as ofthe date these
financial statements were available to be issued. To fund theacquisitions, the Parent made a capitalcontribution of
$800,000 in January. The unaudited provisional purchase price allocationfor the acquisition is summarized in the table
below:

                                                                                           Unaudited
                                                                       Hubbard                              Total
                                                                         Bert                ERG        Acquisitions
         Consideration paid:
           C881 e ocm enercenmencencmcmsnnencnercen                $     700,000       $      113,000   $    813,000
           Contingent earnout consideration payable                       63,042                  —           63,042
            TOlal PUMGRASE PHICE: . . s coomeresveroerrerecrecence $     763,042       $      113,000   $    876,042
         Allocation of purchase price:
         Intangible assets:
          Goodwill                                                $      381,521       $       56,500   $    438,021
          Customerrelationships.                                         381,521               56,500        438,021
           Total assets acquired.                                        763,042   ~          113,000        876,042
              Net fair value of assets acquired.                         763,042       $      113,000   $    876,042




The purchase price allocation presented hereinis subject to review within the first year of operations to determine the
necessity of adjustments.


 /) Crowe Horwath                                                                  Crowe Horwath LLP
                                                                                   Independent Member Growe Howath Intematinal




               REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM



To the Board of Directors and Shareholderof
 Hub International Investment Services Inc.


We have reviewed management‘s statements, included in the accompanying Hub International
Investment Services, Inc.‘s Exemption Report pursuant to Rule 17a—5(d), in which (1) Hub International
Investment Services Inc. (the Company) identified the Company may file an Exemption Report because
the Company had no obligations under 17 C.F.R. § 15c3—3 (the Exemption Provisions) and (2) the
Company stated that the Company met the identified Exemption Provisions throughout the period from
January 1, 2016 to December 31, 2016 without exception. The Company‘s managementis responsible
for compliance with the Exemption Provisions and its statements.

Our review was conducted in accordance with the standards of the Public Company Accounting
Oversight Board (United States) and, accordingly, included inquiries and other required procedures to
obtain evidence about the Company‘s compliance with the Exemption Provisions. A review is
substantially less in scope than an examination, the objective of which is the expression of an opinion on
management‘s statements. Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material modifications that should be made to
management‘s statements referred to above for them to be fairly stated, in all material respects, based on
the conditions set forth in paragraph (k)(2)(i) of Rule 15c3—3 under the Securities Exchange Act of 1934.



                                                         (o/\_a—“-e %fluflflx LLP
                                                        Crowe Horwath LLP

Oak Brook, Illinois
February 28, 2017


                                                                                     HUB InternationalInvestment E orvices

        HuB                                                                          2303 Towngate Road, Suite 101
                                                                                     Westlake Village, CA 01361

                                                                                     (805) s7o.057e



Denise R. Scher
President & Chief Compliance Officer

Direct (805) 879—9576
Fax (805) 832—6447


February 28, 2017

                          Hub International Investment Service, Inc.‘s Exemption Report

Hub International Investment Services, Inc. (the "Company") is a registered broker—dealer subject to Rule 17a—5
promulgated by the Securities and Exchange Commission (17 C.F.R. §240.17a—5, "Reports to be made by certain
brokers and dealers"). This Exemption Report was prepared as required by 17 C.F.R. §240.17a—5(d)(1) and (4). To
the best of its knowledge andbelief, the Companystates the following:

The Company may file an Exemption Report because the Company had no obligations under 17 C.F.R. § 240.15¢3—
3. The Company met the identified exemption provisions under the claim exemption Rule 15c3—3(k)(2)(i) ofthe Act
throughout the period from January 1, 2016 to December 31, 2016 withoutexception.



Hub International InvestmentServices

I, Denise Scher, swear (or affirm) that, to my best knowledge and belief, this Exemption Report is true andcorrect.

sn Seaaathim:
Title: President and Chief Compliance Officer



Document Created: 2017-03-01 06:57:40
Document Modified: 2017-03-01 06:57:40
Additional Files
FileSequenceDescriptionTypeSize
0001462258-17-000001.txt   Complete submission text file   3172902

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