FOCUS Report Wells Nelson & Associates, L.l.c.

X-17A-5 [Paper] - FOCUS Report

Published: 2010-03-11 07:34:42
Submitted: 2010-02-25
Period Ending In: 2009-12-31
scanned.pdf Scanned paper document


     IIULThI                                                             UNITED STATES
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                                                                                                                                                               Number                  3235-0123

                10025788                   SECURITIES               AND EXCHANGE COMMISSION                                                            Expires              February      28 2010
                                                               Washington                      D.C         20549                                       Estimated      average    burden

                                                                                                                                                       hours   ner response..                 12.00


                                                        ANNUAL AUDITED REPORT
                                                             FORM X-17A-5                                                                                          SEC    FILE    NUMBER

                                                                                PART             III
                                                                                                                                                                           8-52490

                                                                           FACING PAGE
                   2fati                  Required       of Brokers              and Dealers Pursuant                                   to   Section    17    of the

                               Se    unties    Exchange             Act of 1934 and Rule 17a-5                                          Thereunder
                             503

RE     RT FOR THE PERIOD BEGINNING                                               01/01/09                                         AND ENDING                             12/31/09
                                                                                 MMIDD/YY                                                                                MM/DD/YY



                                                          REGISTRANT IDENTIFICATION

NAME     OF BROKER-DEALER                                                                                                                                      OFFICIAL         USE ONLY


Wells Nelson             Associates       LLC

                                                                                                                                                                     FIRM       ID   NO
ADDRESS         OF PRINCIPAL         PLACE OF BUSINESS                       Do       not use          P.O Box              No
The Hightower           Building 105              Hudson       Suite 600

                                                                               No      and     Street




Oklahoma         City                                                                  OK                                                                                73102
                      City                                                                  State                                                                        Zip    Code


NAME AND          TELEPHONE         NUMBER         OF PERSON                 TO CONTACT                          IN    REGARD TO             THIS     REPORT


                                                                                                                                                              Area   CodeTelephone             No

                                                          ACCOUNTANT                           IDENTIFICATION


INDEPENDENT             PUBLIC ACCOUNTANT                  whose          opinion      is      contained               in this   Report


CF       Co      L.L.P
                                                        Name        if   individual    state    last     first    middle     name


14175 Proton         Rd                                                                Dallas                                                 TX                                        75244

      Address                                                                          City                                                   State                                     Zip   Code


CHECK ONE
                    Certified   Public   Accountant

                    Public   Accountant

                    Accountant     not resident    in   United States or any of                    its
                                                                                                          possessions


                                                                          FOR OFFICIAL USE ONLY




Claimsfor        exemption   from the requirement that the annual                    report      be      covered          by the opinion      of an independent          public      accountant

must be supported       by    statement offacts and circumstances                    relied on          as the basis for the             exemption      See    section 240.1         7a-5e2



                                            Potential    persons         who   are    to    respond         to     the     collection    of information

SEC    1410 06-02                           contained     in this    form      are    not required                to   respond      unless the   form displays

                                              currently    valid     0MB        control         number


                                                                       OATH OR AFFIRMATION


       Edward        Wells                                                                                                                                      swear      or     affirm              that to the best of

                     and   belief         the     accompanying                       financial       statement and                                              schedules pertaining                        to the        firm     of
my     knowledge                                                                                                                        supporting

Wells Nelson               Associates                 LLC                                                                                                                                                                     as   of

December        31                                     2009          are true          and      correct                 further            swear         or     affirm         that     neither        the        company nor
                                     principal             officer         or    director          has any             proprietary                 interest       in             account          classified              solely     as
any    partner proprietor                                                                                                                                                any
that   of   customer       except         as     follows




                                                                                                                                                                           signature




                                                                                                                         ..resident
                                                                                                                          JQYC                    ROSS                          Title




                                                                                                                                Notary       Public

                                                                                                                           State      of   Oklahoma
                                                                                           Commission                  01004352            Expires       03/1    3/13




            This report           contains           check           all   applicable              boxes
                       Facing page

                       Statement         of    Financial     Condition

                       Statement         of Income          Loss
                       Statement         of Cash         Flows

                       Statement         of Changes          in   Stockholders              Equity     or partners             or Sole       Proprietors           Capital

                       Statement         of Changes          in Liabilities           Subordinated           to   Claims of Creditors

                       Computation             of Net      Capital

                       Computation             for   Determination              of   Reserve      Requirements                 Pursuant       to    Rule        5c3 -3

                       Information            Relating      to the    Possession            or control       Requirements                  Under     Rule        5c3-3

                           Reconciliation                including         appropriate          explanation               of    the        Computation           of      Net    Capital        Under        Rule         5c3-1     and    the


                       Computation             for   Determination of                the   Reserve     Requirements                Under          Exhibit         of Rule         5c3-3

                           Reconciliation             between        the     audited        and    unaudited             Statements           of    Financial           Condition       with     respect          to   methods     of    con
                       solidation

                       An Oath       or   Affirmation

                           copy     of   the    SIPC       Supplemental              Report

                                     describing                   material       inadequacies         found        to    exist     or   found       to   have    existed       since    the    date    of   the    previous      audit
                           report                          any

                       Independent             auditors      report    on       internal     control




             For   conditions       of   confidential        treatment           of   certain     portions        of    this
                                                                                                                               filing       see    section      240.1    7a-5e3


WELLS NELSON   ASSOCIATES   LLC


REPORT PURSUANT TO RULE   17a-5d


 YEAR ENDED DECEMBER   31 2009


                             WELLS NELSON                    ASSOCIATES       LLC



                                                   CONTENTS

                                                                                    PAGE

INDEPENDENT        AUDITORS REPORT

STATEMENT         OF FINANCIAL CONDITION


STATEMENT         OF INCOME


STATEMENT         OF CHANGES        IN   MEMBERS EQUITY

STATEMENT OF CHANGES IN LIABILITIES
  SUBORDINATED TO CLAIMS OF GENERAL CREDITORS

STATEMENT         OF CASH FLOWS


NOTES   TO FINANCIAL STATEMENTS                                                      7- 13



SUPPORTING SCHEDULES


  Schedule             Computation        of Net Capital Under

                       Rule 15c3-1       of the Securities

                       and Exchange        Commission                               15   16



  Schedule   II        Computation        for   Determination    of Reserve

                       Requirements Under           Rule     5c3 -3 of the

                       Securities    and Exchange       Commission                       17




INDEPENDENT AUDITORS REPORT ON INTERNAL
  CONTROL REQUIRED BY SEC RULE 17a-5                                                19-20


INDEPENDENT AUDITORS REPORT ON THE SIPC ANNUAL
  ASSESSMENT REQUIRED BY SEC RULE 17a-5                                             22-24


                                                                                        CF Co  CERTIFIED       PUBLIC ACCOUNTANTS
                                                                                                                                        L.L.T

                                                                                                               CONSULTANTS




                                                           INDEPENDENT                            AUDITORS REPORT



Board of Directors and Members
Wells Nelson                     Associates               LLC


We     have audited               the accompanying                         statement             of financial                condition           of Wells Nelson                         Associates

LLC      as of        December 31 2009 and                                 the related             statements                of income changes                         in    members             equity

changes        in     liabilities           subordinated               to      claims          of general              creditors            and cash           flows          for    the year       then

ended      that       you    are       filing      pursuant           to    rule         7a-5 under                  the Securities               Exchange             Act of 1934                These
financial         statements               are    the responsibility                    of the Companys                            management                  Our          responsibility          is   to


express       an      opinion         on these           financial          statements             based          on our audit


We     conducted             our        audit      in     accordance                  with       auditing             standards             generally          accepted             in   the United

States     of America                  Those standards                     require         that        we      plan and perform the audit                              to    obtain       reasonable

assurance           about         whether             the       financial          statements                  are        free     of material               misstatement                  An      audit

includes       examining                on         test     basis        evidence              supporting             the amounts                 and disclosures                 in   the financial

statements                An       audit          also      includes             assessing               the         accounting                 principles           used         and     significant

estimates          made by management                               as     well       as    evaluating                the        overall        financial        statement             presentation

We    believe         that       our audit provides                        reasonable             basis        for        our opinion



In our opinion the                     financial          statements               referred to above                        present         fairly      in    all     material         respects         the

financial       position           of Wells             Nelson                 Associates               LLC           as    of December                 31 2009              and the       results       of

its   operations            and       its   cash       flows        for     the       year then               ended         in     conformity            with        accounting            principles

generally accepted                    in    the United             States        of America


Our    audit       was made                for   the purpose of forming an                               opinion             on the basic            financial            statements            taken    as

  whole           The     information                 contained             in   the Schedules                       and      II   is   presented          for
                                                                                                                                                                    purposes           of additional

analysis        and         is    not             required            part         of      the     basic          financial             statements                  but      is    supplementary

information            required             by    rule          7a-5       under the             Securities               Exchange              Act of 1934                  Such        information

has   been subjected                   to    the auditing              procedures                applied             in    the audit of the basic                      financial          statements

and      in    our       opinion             is    fairly         stated         in     all      material             respects             in    relation        to       the     basic     financial

statements          taken        as         whole




                                                                                                                CF               Co     L.L.P

Dallas        Texas

February          22     2010



              14175     Proton    Road       Dallas     Texas     75244-3604          Phone      972-387-4300               800-834-8586          Fax   972-960-2810            www.cfllp.com


                                                                                   REGISTERED          WITH    THE    PCAOB
                                                            MEMBERS        A1CPA      CENTER     FOR QUALITY TSCPA
                                                                                                       AUDIT            EBPAQC
                                                      CPAMERICA     INTERNATIONAL      AN AFFILIATE OF HORWATH  INTERNATIONAL                           AND
                                                                       THE INTERNATIONAL      ACCOUNTING   GROUP TIAG


                                          WELLS NELSON               ASSOCIATES              LLC
                                                Statement    of Financial        Condition

                                                          December 31 2009


                                                               ASSETS


Cash and cash            equivalents                                                                               321621

Deposits      with       clearing broker-dealer                                                                   1719826
Receivable         from clearing broker-dealer                                                                     675644
Receivable         from advisory          clients
                                                                                                                   435768
Securities     owned        at   fair   value                                                                      849201

Furniture      equipment and leasehold                  improvements      net                                       80750
Other   assets                                                                                                      22730


                                                                                                                  4105540


                                          LIABILITIES       AND MEMBERS EQUITY

Liabilities


  Accounts         payable                                                                                          51163
  Accrued      expenses                                                                                           1217247
  Payable     to    clearing broker-dealer                                                                         854700
  Capital lease obligation                                                                                           4649


    Total     liabilities                                                                                         2127759


Members        equity                                                                                             1977781


                                                                                                                  4105540




                   The    accompanying          notes   are an integral   part    of these financial statements



                                                                 Page


                               WELLS NELSON                  ASSOCIATES           LLC
                                                 Statement   of Income

                                   For the Year Ended December              31   2009



Revenues

 Commissions                                                                                              1248309
 Trading    and investment     gains                                                                      1840499
 Underwriting      and advisory     fees                                                                  1386700
 Interest                                                                                                  111373
 Other                                                                                                     162894


                                                                                                          4749775


Expenses

 Employee       compensation      and benefits                                                            3075961

 Brokerage and clearance          fees                                                                     132542
 Communications                                                                                            101372

 Occupancy       and equipment costs                                                                       198788
 Promotional costs                                                                                         108281

 Interest                                                                                                   19772
 Data processing       costs                                                                                35109

 Regulatory     fees   and expenses                                                                         66136
 Other                                                                                                     123285


                                                                                                          3861246


   Net income                                                                                              888529




              The accompanying           notes   are an integral   part   of these financial statements



                                                          Page


                             WELLS NELSON             ASSOCIATES            LLC
                             Statement   of Changes     in   Members      Equity

                              For the Year Ended      December 31 2009




                                                                            Number of               Members
                                                                               Units                 Equity



Balance   December 31 2008                                                         1367              1577872


Distributions                                                                                         488620

Net income                                                                                             888529
                                                                         _____________


Balance   December 31 2009                                                         1367              1977781




             The   accompanying   notes are an integral      part   of these financial statements



                                                 Page


                           WELLS NELSON                ASSOCIATES             LLC
     Statement   of Changes   in   Liabilities   Subordinated     to   the Claims of General     Creditors

                              For the Year Ended December               31   2009




Balance   December 31 2008


 Additions




 Retirements




Balance   December 31 2009                                                                                   --




             The accompanying      notes are an integral   part
                                                                  of these    financial   statements




                                                    Page


                                            WELLS NELSON                        ASSOCIATES            LLC
                                                          Statement          of Cash Flows

                                             For the Year Ended December                        31   2009



Cash   flows    from operating                    activities


 Net income                                                                                                                     888529

 Adjustments          to    reconcile net income                to   net

   cash   provided          used          by operating         activities


       Depreciation             and amortization                                                                                 31866

       Changes     in      operating        assets      and    liabilities


        Increase       in       deposits    with      clearing broker-dealer                                                    274559
        Increase       in   receivable            from clearing broker-dealer                                                    21589
        Increase       in   receivable            from customers                                                                434862
        Decrease           in securities          owned                                                                        1079747
        Decrease           in   other assets                                                                                      8496
        Increase       in       accounts     payable                                                                             35596
        Decrease           in   payable      to    clearing broker-dealer                                                      1064343
        Increase       in       accrued     expenses                                                                            539734


       Net cash    provided           used          by operating       activities                                               788615


Cash    flows    from           investing     activities


 Purchase       of furniture          and equipment                                                                              26727

       Net cash    provided           used          by investing       activities                                                26727

Cash    flows    from financing                   activities


 Repayment        of       capital    lease obligation                                                                           4722
 Distributions                                                                                                                  488620

       Net cash       provided        used          by financing           activities                                           493342

Net increase      in   cash        and cash        equivalents                                                                  268546


Beginning       cash       and cash        equivalents                                                                           53075


Ending cash       and cash           equivalents                                                                                321621


Supplemental           Disclosures

  Cash paid      for

   Interest                                                                                                                      19772


   Income       taxes                                                                                                                    --




                The        accompanying              notes are an integral              part of these financial   statements




                                                                            Page


                               WELLS NELSON                                 ASSOCIATES                    LLC
                                            Notes       to    Financial            Statements

                                                       December 31 2009


Note                                                                              Policies
       Summary of               Significant             Accounting



       Basis    of Financial                 Statement               Presentation



       The     financial statements                     present            the financial            position          and     results       of operations            of

       Wells Nelson                    Associates              LLC          the     Company                     an Oklahoma                 limited liability

                                                        2000    Three individuals who are
       company which was formed on February
       members of management and/or employees of the Company own the majority of
       the membership     interests The   Company shall terminate on February 28 2050
       unless earlier terminated   Profit and loss are allocated to members in accordance

       with    their      percentage              ownership of outstanding                            units           The     number         of membership

       units    authorized             must be          approved             by the majority               of the           board      of   members             Each

       members            liability         is   limited      to     its   capital       account       balance



       FASB       Codification



       In     June        2009         the        Financial            Accounting                   Standards           Board          FASB                    issued

       Statement               of    Financial              Accounting               Standard           SFAS                      No        168        The     FASB
       Accounting               Standards              CodUlcation                 and        the    Hierarchy                of Generally               Accepted

       Accounting               Principles                          replacement                of    FASB         Statement             No        162        SFAS
       168 FASB ASC                              105-10             SFAS          168    replaces         all    previously            issued          accounting

       standards          and establishes the                        FASB          Accounting             Standards               CodfIcation                FASB
       ASC           as        the    source           of    authoritative               accounting             principles             recognized             by the
       FASB       to      be applied              by nongovernmental                           entities      in       the    preparation            of financial

       statements              in    conformity              with     U.S         GAAP SFAS                     168     is    effective          for   all    interim

       and     annual           periods           ending           after     September               15     2009             The FASB              ASC         is    not

       intended           to    change           existing            U.S          GAAP          The     adoption              of    this     pronouncement

       only      resulted             in     changes            to         the     Companys                financial               statement           disclosure

       references              As such             the       adoption             of this      pronouncement                      had no          effect      on the

       Companys                 financial position                    results       of operations               or cash           flows



       In order to             facilitate        the transition              to    the    FASB         ASC            the    Company             has     elected      to


       show       all     references              to    FASB ASC                    along       with            parenthetical               reference          to    the

                          accounting              standard
       previous



       Business Operations


       The      Company                is        broker-dealer                in    securities         registered             with     the       Securities          and

       Exchange            Commission                  SEC                 under        Rule        5c3-3k2ii                     which provides              that    all



       the funds          and        securities        belonging             to    the   Companys               customers           would be handled                  by

             clearing          broker-dealer                    In     accordance               with      the     provisions                of    this       rule    the


       Company                 executes          all    of    its    customers                transactions             on          fully-disclosed basis

       through          an unaffihiated                     clearing         broker-dealer                located            in   Dallas         Texas which
        carries         the         accounts           and      securities               of    the     Companys                    customers               Principal



                                                                      Page


                          WELLS NELSON                              ASSOCIATES                     LLC
                                        Notes     to    Financial             Statements

                                                 December 31 2009




Note   Summary         of Significant             Accounting              Policies



       Business Operations                     continued


       business     activities          are    conducting           principal and agency                     transactions              and providing

       underwriting          and advisory              services          for    customers          primarily located               in    Oklahoma


       Underwriting              and Advisory Fees

                              and advisory               fees       include                                  and fees             net    of
       Underwriting                                                                  gains losses                                              syndicate

                       arising           from     securities             offerings          in    which        the     Company                acts        as    an
       expenses
       underwriter          or    agent          Underwriting                  and advisory             fees     also include                fees    earned

       from providing              financial       advisory              services           Underwriting               and advisory                 fees are

       recorded      at     the time          the underwriting                  is   completed           and the income                 is    reasonably

       determinable



       Securities         Transactions

                                                                                                            entered                          the     account
                                  arising from
       Profit    and   loss                               all     securities          transactions                         into    for


       and   risk   of the Company                     are   determined               using       the    specific        identification              method

       and are recorded                  on       trade       date       basis         Customers               securities         transactions                  are


                     on          settlement        date basis with                   related commission                   income         and expense
       reported

                       on         settlement            date       basis             The     amounts           recorded           for       commission
       reported

       income        and                         for     customers                   securities         transactions             approximate                    the
                                 expense
       amounts       that    would be recorded                     on         trade date basis



       Cash and Cash Equivalents

       For purposes              of the                             of        cash    flows        the                           has    defined            cash
                                               statement                                                   Company
       equivalents          as    highly         liquid         investments                with    original          maturities          of        less        than

       ninety     days      not        held for    sale      in    the ordinary             course       of business



       Furniture            Equipment             and Leasehold Improvements

                                                  and        leasehold               improvements                are      stated         at     cost           less
       Furniture            equipment
       accumulated                                           Depreciation              is   provided           principally             by     accelerated
                              depreciation

       and      straight-line           methods          using       estimated              useful       lives      of    five     to    seven            years
       Leasehold improvements                          are amortized                 over   the lesser         of the economic                 useful           life



       of the improvement                  or the term of the lease



       Income        Taxes

       The                             treated    and taxed                      partnership for federal                  income         tax
                                                                                                                                                   purposes
                Company           is                                     as

                                                                  the responsibility              of the individual               members
       Accordingly            any tax         liability      is




                                                                  Page


                           WELLS NELSON                                  ASSOCIATES                      LLC
                                       Notes           to    Financial          Statements

                                                     December             31        2009




                                                                                                continued
Note   Summary of              Significant            Accounting               Policies



       Income Taxes                 continued


       In    June      2006         the     FASB             issued       FASB               Interpretation            No 48                  Accounting              for

       Uncertainty             in    Income            Taxes          an       interpretation                 of   FASB           Statement                 No        109

       FIN          48         FIN 48          clarifies       the       accounting             for    income           taxes        by prescribing                   the

       minimum            recognition               threshold that                  tax position             must meet              to    be recognized                in


       the     financial            statements               FIN         48      also        provides           guidance                 on     measurement
                                    classification             interest         and penalties                 accounting             in    interim periods
       derecognition

       disclosure and transition                           FIN 48        has    been incorporated                     into    FASB ASC 740                        The

       Company adopted FIN 48 for its year ended December 31 2009                                                                          The       adoption          of

       FIN 48 did not have material effect on the Companys financial                                                                       position            results


       of operations            or cash             flows



       Use of Estimates

       The     preparation            of    financial          statements               in    conformity           with accounting                     principles

       generally          accepted             in    the     United        States        of     America            U.S GAAP                          requires         the

                               make         estimates          and assumptions                    that       affect      the reported                 amounts          of
       Company            to

                    and    liabilities          and disclosure of contingent                             assets        and        liabilities          at   the date
       assets

       of the financial statement                            Actual       results        could        differ    from those estimates



Note   Deposits        with     Clearing Broker-Dealer



                       with                          broker-dealer               include        cash                         to   be maintained                  at   the
       Deposits                     clearing                                                             required

       clearing broker-dealer                        for    clearing and trading                  activities




Note   Securities         Owned


       Securities          owned          at    fair        value    as    of December                  31      2009          are    considered                trading

       securities         and consist of               state    and municipal                   obligations             In accordance                 with     FASB
       ASC       820      Fair       Value          Measurements                    SFAS No 157                    the       Company               categorizes          its



       financial       instruments                  recorded        at    fair      value      into          three-level            fair      value     hierarchy

                                                                                                                                           in      active    markets
       The      fair   value        hierarchy gives the highest                          priority       to    quoted         prices

       for     identical        assets         or    liabilities         Level               and the lowest                  priority         to    unobservable

                                          If   the inputs used                 to   measure the              financial         instruments              fall     within
        inputs Level

        different      levels        of the hierarchy                the categorization                  is    based on the lowest                      level     input

        that   is                      to      the fair value            measurement              of the instrument
                    significant




        Financial         assets       and          liabilities      recorded            on the        Statement              of Financial              Condition

        are categorized              based on the inputs                       to   the valuation             techniques             as follows




                                                                    Page


                             WELLS NELSON                             ASSOCIATES                  LLC
                                           Notes       to   Financial     Statements

                                                      December 31 2009




Note   Securities       Owned              continued



       Level            Valuations              based on quoted                 prices in active           markets        for    identical         assets


       or liabilities that            the    Company              has the ability         to    access



       Level            Financial            assets         and   liabilities      whose         value     are based           on quoted           prices

       in   markets         that     are not      active       or model inputs that               are observable               either     directly       or

       indirectly       for    substantially                the full term of the asset              or liability



       Level                Financial            assets       and    liabilities        whose      values         are    based         on prices or

       valuation        techniques              that    require inputs           that    are both unobservable                   and      significant

       to    the overall           fair   value       measurement             These inputs          reflect       managements judgment
       about        the assumptions                   market      participant      would use          in   pricing       the asset or liability



       In    April     2009          the     FASB           issued      guidance         for     determining            fair    value        when        the

       volume         and     level        of   activity       for   the asset         or liability      have        significantly         decreased

       as     well     as    identifying               circumstances            that     indicate           transaction           is     not      orderly

       FASB ASC                    820-10             The     adoption        of   this    additional           fair    value         determination

       guidance         during            2009 did not have                   material         impact on the Companys                          financial


       statements



       State        and municipal               obligations          consist of debt            securities       that    are    valued         based on

                             received           from        dealers      who       make         markets         in    such      securities          or   by
       quotations

       independent                 pricing        services           These      pricing         services        generally             utilize      matrix

       pricing        which         considers           yield or price           of bonds          of comparable                quality          coupon
       maturity        and type as well                  as   dealer    supplied         prices



       The      following           table       presents       the fair value           hierarchy        for    those assets           and      liabilities


       measured         at fair       value       on        recurring basis        as    of December             31 2009


                                                                                           Financial           Securities       Owned
                                                                              Level                         Level                               Level



            State       and               municipal

            obligations                                                                    --                    849201




                                                                                                                                                                --
                                                                                           --                    849201



        The         Company           did       not     hold      any    financial        liabilities          measured          at    fair     value      at


        December 31 2009




                                                                         10
                                                                Page


                           WELLS NELSON                        ASSOCIATES                  LLC
                                        Notes    to   Financial         Statements

                                                December           31     2009




Note   Furniture          Equipment           and Leasehold Improvements



         summary of            furniture         equipment           and leasehold         improvements                at   December 31
       2009     is   as   follows


             Furniture       and    fixtures                                                                                  171461

             Equipment                                                                                                        184915
             Leasehold improvements                                                                                               24930
                                                                                                                              381306
             Less         accumulated depreciation                   and amortization                                        300556

                                                                                                                                  80750


Note   Leases



       The      Companys                facilities       and       certain        equipment       are       leased          under      various

       operating          leases    with       initial   noncancelable             terms    in   excess       of one year              Rental

                      related      to    facilities      and equipment              amounted         to    $135348           during       2009
       expense
       One    facility lease
                             contains                    renewal        option


       The    Company           leases        certain equipment               under        capital        lease        Assets     under          this


                     lease    are       included       in    the     caption       Furniture         equipment              and     leasehold
       capital

       improvements                in   the    statement       of    financial       condition       and include             equipment             of

       $21893         less   accumulated              amortization           of   $17244


       The    following        are the         minimum         lease      payments       that    will     have    to    be made        in   each

       of the                 indicated           based      on      capital       and   operating          leases      in    effect        as     of
                     years

       December 31 2009


              Year Ended
              December 31                                                                  Operating                          Capital

                     2010                                                                        78049                              4649
                     2011                                                                        49674                                      --



                     2012                                                                        10712


              Total       minimum            lease payments                                     138.435                             4649
                     Amount        representing           interest                                                                     280

              Present value             of   minimum         lease    payments                                                      4369




                                                            Page     11


                            WELLS NELSON                                  ASSOCIATES                  LLC
                                          Notes     to    Financial             Statements

                                                  December 31 2009




Note   Net Capital Requirements and Exemptive Provisions


       The     Company          is    subject       to        the    SEC        Uniform        Net     Capital        Rule         SEC          Rule 15c3-

             which     requires the              maintenance                 of minimum net                 capital         and requires               that    the

       ratio   of aggregate               indebtedness               to   net capital         both     as defined               shall    not     exceed         15

       to       At December                 31 2009                the    Company had                net    capital        of     $1388810                 which

       was     $1288810              in    excess        of   its    required       net capital            of $100000                  The Companys
       ratio   of aggregate               indebtedness              to    net capital        ratio    was     .92     to




       The     Company          is    exempt        from the              Securities         and Exchange             Commission                     Customer
       Protection          Rules          SEC       Rule            15c3-3          which         relate     to    reserves            and      custody         of

       securities          under section            k2ii of                  this   rule



Note   Concentration            of Credit Risk



       Cash     at    one bank             may      have        exceeded            federally         insured         limits        at    various           times

       throughout           the year        ended December                      31 2009

Note   Defined        Contribution              Plan



       The      Company               adopted                  40    1k         profit       sharing         plan          covering            all        eligible

       employees              effective           January                       2003              Participants             may           make          deferral

       contributions          up      to    the annual             maximum             amount        allowed by the                Internal          Revenue

       Code          The     Company may                  also        make       discretionary             contributions               and      safe       harbor

       matching            contributions                 Safe        harbor       matching           contributions                were        $61886           for

       2009 There were no                       discretionary              contributions           during         2009


Note   Commitments and                     Contingent               Liabilities




       The Company               is        engaged        in        various      trading          and brokerage                 activities           in    which

       counterparties                primarily            include            broker-dealers                 banks           and        other         financial

       institutions             In        the    event         counterparties                do    not      fulfill        their       obligations             the

       Company             may       be exposed               to     risk        The     risk      of default          depends            on the            credit

       worthiness           of the         counterparty              or issuer         of the instrument                     It   is    the    Companys
       policy    to    review         as necessary                  the credit       standing         of each counterparty



       The     Company           is        required       to        indemnify          its   clearing        broker/dealer                if         customer
       fails    to     settle              securities           transaction              according           to     its     clearing            agreement

       Management               was         neither     aware nor had it been                                notified             of any         potentially

       material       indemnification               loss at December 31 2009




                                                                Page       12


                             WELLS NELSON                    ASSOCIATES                   LLC
                                      Notes   to   Financial         Statements

                                             December 31 2009




Note   10   Subsequent       Events



            For purposes      of preparing         the   accompanying              financial     statements   and the     related


            notes     the   Company    evaluated         events      that   have occurred        after   December 31 2009

            through     February      22 2010        the    date     the    financial      statements     were      available   for

            issuance        During    this   period        Securities        did    not   have    any    material     subsequent

            events




                                                         Page   13


    Supplemental       Information



  Pursuant   to   Rule 17a-5    of the



Securities   Exchange       Act of 1934


                  as   of



        December       31   2009


                                                                   Schedule



                                         WELLS NELSON                    ASSOCIATES         LLC

  Computation          of Net Capital Under              Rule 15c3-l         of the Securities and Exchange   Commission

                                                     As     of   December 31 2009




Computation           of Net     Capital



Total memberst          equity      qualified for net capital                                                    1977781


Deductions and/or             charges

 Non-allowable             assets

      Receivable       from customers                                                          435768

      Furniture       equipment         and leasehold       improvements                          80750

      Prepaid      expenses     and other       assets                                            14900           531418

Net    capital    before     haircuts on securities          positions                                           1446363


Haircuts     on    securities    computed           where        applicable

  pursuant       to   Rule    15c3-1f
        Debt     securities                                                                                        57553

Net    capital                                                                                                   1388810




Aggregate          Indebtedness



Items    included      in    statement     of   financial        condition

  Accounts         payable                                                                                          51163
  Accrued        expenses                                                                                        1223510

  Capital lease obligation                                                                                          4649


Total aggregate         indebtedness                                                                             1279322




                                                                     Page     15


                                                    Schedule          continued


                                        WELLS NELSON                    ASSOCIATES          LLC
 Computation           of Net Capital Under           Rule 15c3-1         of the Securities and Exchange       Commission

                                                   As    of   December 31 2009




Computation           of Basic Net       Capital Requirement



Minimum         net capital     required       2/3%      of total

 aggregate       indebtedness                                                                                           85292




Minimum dollar            net capital   requirement           of

 reporting      broker     or dealer                                                                                    100000




Minimum net           capital   requirement        greater     of two

 minimum         requirement       amounts                                                                              100000




Net   capital    in   excess    of minimum required                                                                 1288810




Excess net      capital    at   1000%                                                                               1260878




Ratio                                                                                                            0.92
          Aggregate indebtedness              to   net capital                                                           to




Reconciliation         with     Companys Computation


There were no material differences                  in   the computation       of net   capital   under rule   5c3 -1

from the Companys               computation




                                                                   Page   16


                                                       Schedule        II




                                WELLS NELSON                    ASSOCIATES             LLC
                  Computation       for   Determination         of Reserve       Requirements Under

                        Rule 15c3-3       of the   Securities    and Exchange         Commission
                                             As    of December         31    2009




Exemptive     Provisions




The   Company    has   claimed an exemption           from Rule 15c           3-3 under section    k2ii          in   which

all   customer transactions     are cleared    through      another         broker-dealer   on    fully   disclosed   basis




Companys     clearing    firm    First    Southwest Company




                                                          Page    17


Independent    Auditors      Report



     On   Internal   Control



Required By    SEC    Rule     17a-5



Year Ended December       31    2009


                                                                                      CF Co CERTIFIED
                                                                                                                             L.L.T
                                                                                                            PUBLIC ACCOUNTANTS
                                                                                                            CONSULTANTS




                                    INDEPENDENT AUDITORS REPORT ON INTERNAL
                                        CONTROL REQUIRED BY SEC RULE 17a-5

To     the Board of Directors and                           Members
Wells Nelson                     Associates            LLC


In planning             and performing our audit of the                                      financial             statements        of Wells Nelson                          Associates
LLC       the      Company                      as     of       and    for        the    year         ended         December 31 2009                         in    accordance              with

auditing         standards            generally                 accepted            in      the      United          States         of America               we        considered             the

Companys                internal      control             over    financial reporting                        internal        control as              basis for designing                      our

auditing procedures                   for the purpose of expressing                                       our opinion          on the financial statements                             but not

for    the purpose of expressing                              an opinion              on the effectiveness                     of the    Companys                  internal            control

Accordingly                we      do     not       express           an opinion                   on the           effectiveness         of the          Companys                     internal

control



Also      as     required          by Rule             17a-5g1                     of the         Securities             and Exchange               Commission                SEC             we
have      made                study       of the            practices              and       procedures                  followed       by     the       Company               including

consideration              of control               activities             for      safeguarding                   securities          This         study         included         tests        of

compliance              with       such       practices            and procedures                         that     we     considered          relevant            to    the    objectives

stated     in    Rule         17a-5g           in     making           the periodic                 computations               of aggregate              indebtedness                  and net

capital        under Rule                7a-3             11      and        for     determining                  compliance          with the exemptive                       provisions

of Rule          15c3-3            Because                the    Company                 does         not         carry    securities         accounts            for    customers             or

perform custodial                  functions              relating           to    customer securities                      we      did not      review           the    practices and

procedures             followed          by the Company                       in
                                                                                    any of the following


                       Making       quarterly              securities             examinations counts                        verifications               and comparisons                      and

                       the recordation               of differences                  required by Rule 17a-13

                       Complying              with the requirements                             for    prompt            payment       for     securities          under Section

                       of Federal          Reserve              Regulation                      of the Board of Governors                            of the Federal                Reserve

                       System


The     management of                   the    Company                is   responsible                for      establishing          and maintaining                   internal        control

and      the     practices          and       procedures                   referred          to      in     the     preceding          paragraph                  In     fulfilling           this


responsibility                estimates             and judgments                       by      management                 are      required        to    assess         the      expected

benefits        and related              costs        of controls                   and of the                                 and procedures                  referred           to     in   the
                                                                                                               practices

preceding          paragraph              and        to    assess whether                       those       practices        and procedures                   can be expected                   to

achieve        the     SECs        above-mentioned                         objectives                 Two         of the objectives            of    internal          control         and the

practices and procedures                           are to        provide           management with reasonable                                 but    not      absolute         assurance

that     assets         for      which         the         Company                 has       responsibility                 are     safeguarded               against          loss       from

unauthorized               use      or        disposition                  and        that         transactions              are     executed            in       accordance               with

managements                   authorization                    and     recorded                 properly            to    permit       the      preparation               of      financial




               14175    Proton    Road    Dallas      Texas     75244-3604          Phone       972-387-4300         800-834-8586       Fax   972-960-2810         www.cfllp.com


                                                                                   REGISTERED      WITH     THE   PCAOB
                                                          MEMBERS      AICPA       CENTER    FOR    QUALIIY
                                                                                                    AUDIT     TSCPA     EBPAQC
                                                   CPAMERICA      INTERNATIONAL       AN AFFILIATE OF HORWATH   INTERNATIONAL                 AND
                                                                      THE INTERNATIONAL      ACCOUNTING GROUP TLkG


statements             in     conformity                 with       generally                accepted        accounting                 principles             Rule          7a-5g              lists


additional         objectives                 of the practices and procedures                                listed          in   the preceding             paragraph


Because           of inherent limitations                            in    internal           control       and the practices                   and procedures                 referred           to


above        error       or fraud             may        occur       and not be detected                  Also projection of any evaluation of them
to   future       periods           is      subject       to     the      risk     that       they    may become inadequate   because of changes in

conditions             or that       the effectiveness                     of    their       design      and operation                  may     deteriorate



     deficiency             in     internal         control          exists       when         the    design        or operation                of       control       does not            allow

management                   or     employees                  in    the        normal         course        of performing                    their      assigned            functions            to


prevent          or detect          misstatements                   on          timely basis



     significant            deficiency              is      deficiency                 or      combination                   of deficiencies             in    internal       control           that

is   less   severe than                     material        weakness                yet important                enough            to   merit       attention       by those charged
with    governance


     material          weakness               is     deficiency                 or combination               of deficiencies                   in    internal       control         such        that

there       is          reasonable                  possibility            that              material        misstatement                     of the        Companys                financial

statements             will      not     be prevented                 or detected              and corrected                  on        timely basis



Our     consideration                    of    internal             control        was         for    the    limited              purpose          described          in     the    first       and

second paragraphs                        and was not designed                           to    identify      all    deficiencies               in internal        control          that     might
be material             weaknesses                   and therefore                     there      can be no assurance                         that    all     material        weaknesses

have        been        identified                  We      did       not        identify         any       deficiencies                in    internal        control         and        control

activities         for       safeguarding                 securities              that       we      consider           to     be material            weaknesses               as        defined

above


We     understand                 that      practices            and procedures                   that      accomplish                  the   objectives         referred           to     in    the

second           paragraph               of   this       report      are        considered            by    the     SEC            to   be adequate             for    its    purposes             in

accordance              with       the        Securities            Exchange             Act of 1934 and related regulations                                     and       that     practices

and procedures                    that      do not accomplish                     such objectives                 in     all      material      respects        indicate            material

inadequacy              for      such purposes                      Based        on     this   understanding                   and on our study we believe                               that    the

Companys                practices             and procedures                      as     described          in    the        second       paragraph            of   this     report         were

adequate          at    December 31 2009                             to    meet the           SECs       objectives



This    report          is    intended              solely for the                 information              and use               of the      Managers              management                   the

SEC         the    Financial                Industry           Regulatory                Authority           and other regulatory                           agencies         that        rely     on
Rule 17a-5g                   under the Securities Exchange                                    Act of 1934               in their        regulation           of registered brokers

and dealers                 and        is     not    intended              to    be and           should          not        be used          by     anyone         other      than         these

specified parties




                                                                                                            CF               Co     L.L.P

Dallas Texas

February          22        2010


 Independent Auditors Report


On   The   SIPC Annual Assessment



 Required By     SEC   Rule 17a-5



Year Ended December       31   2009


                                                                                                CF Co L.L.T
                                                                                                       CERTIFIED       PUBLIC ACCOUNTANTS
                                                                                                                       CONSULTANTS




                                           INDEPENDENT AUDITORS REPORT ON THE SIPC ANNUAL
                                                 ASSESSMENT REQUIRED BY SEC RULE 17a-5



To    the   Board           of Directors              and     Members
Wells       Nelson                  Associates             LLC

In    accordance                   with    Rule       17a-5e4                 under            the      Securities             Exchange Act                    of     1934 we have                 perfonned              the


procedures               enumerated                below with               respect             to     the     accompanying                   Schedule                of Assessment                and        Payments

                            Assessment                Reconciliation                 Form SIPC-7T                             to    the    Securities              Investor        Protection           Corporation

SIPC         for the
                                   year ended           December              31 2009                  which           were        agreed     to    by Wells               Nelson             Associates             LLC
and    the       Securities               and      Exchange              Commission                      Financial             Industry           Regulatory               Authority              Inc        and    SIPC
solely      to        assist
                                     you        and     the      other        specified                parties         in     evaluating            Wells            Nelson                 Associates             LLCs
compliance               with the applicable                       instructions               of the Transitional                     Assessment                   Reconciliation             Form SIPC-7T
Management                    is
                                    responsible              for     Wells         Nelson                 Associates                 LLCs           compliance                  with      those     requirements
This agreed-upon                      procedures             engagement was conducted                                    in    accordance               with attestation               standards         established

by    the   American                 Institute        of Certified            Public            Accountants                    The      sufficiency                of these        procedures           is    solely      the

responsibility                of those parties specified                            in this            report          Consequently                 we make                no     representation              regarding
the    sufficiency                  of the       procedures             described                below          either         for    the    purpose               for     which       this    report         has        been

requested or for any                       other
                                                      purpose


The procedures we performed                                   and      our findings                  are as        follows



             Compared                     the    listed       assessment                 payments              in      Form         SIPC-7T             with        respective            cash      disbursements

             records               entries       cash        disbursements                journal             noting          no    differences


             Compared                     the    amounts             reported            on     the     audited             Form       X-17A-5                for    the
                                                                                                                                                                            year       ended       December               31
             2009           with the amounts                     reported           in   Form SIPC-7T                        for the
                                                                                                                                          year ended               December 31 2009

             Compared any adjustments                                      reported            in    Form SIPC-7T with supporting                                     schedules and                working         papers

             noting            no     differences             and


             Proved                the    arithmetical               accuracy            of the         calculations                reflected           in    Form         SIPC-7T           and    in   the       related

             schedules and                      working                                                 the                                              no    differences
                                                                 papers supporting                                 adjustments             noting



We     were           not          engaged         to      and       did      not        conduct              an     examination                  the        objective            of which          would be              the

expression             of an             opinion        on     compliance                       Accordingly                   we      do     not        express          such       an      opinion            Had         we
performed              additional               procedures              other        matters             might          have        come      to        our        attention       that       would have                 been

reported         to    you

This report              is    intended           solely         for    the    information                    and      use     of the        specified              parties        listed     above          and    is    not

intended to be and                       should not be               used by anyone                     other        than these           specified           parties




                                                                                                                        CF           Co      L.L.P

Dallas       Texas

February          22 2010
                 14175      Proton       Road     Dallas     Texas     75244-3604             Phone      972-387-4300              800-834-8586              Fax   972-960-2810          www.cfllp.com


                                                                                          REGISTERED          WITH     THE    PCAOB
                                                             MEMBERS AICPA                    CENTER    FOR    AUDIT
                                                                                                              QUALITY TSCPA      EBPAQC
                                                        CPAMERTCA INTEREATIONAL                 AN AFFILIATE OF HORWATH  INTERNATIONAL                             AND
                                                                             THE    INTERNATIONAL      ACCOUNTING   GROUP TIAG


                                                                SECURITIES                            INVESTOR PROTECTION                                                 CORPORATION
     S1PC-7T                                                           805        15th         St     NW         Suite         800 Washington                           D.C 20005-2215                                                                   sIpc-7T
                                                                                                                          202-371-8300
                                                                                      Transitional                      Assessment                       Reconciliation
     29-REV           12109                                                                                                                                                                                                                          29-REV          .12/09
                                                                                                                                                                before
                                                                Read     carefully             the   instructions        In    your    Working      Copy                      completing           this
                                                                                                                                                                                                             Form

                                                          TO BE FILED                      BY ALL SIPC                    MEMBERS WITH                          FISCAL YEAR                          ENDINGS

       Name         of    Member              address            Designated               Examining              Authority            1934    Act        registration              no    and      month           in    which         fiscal     year ends           for

 purposes            of   the     audit           requirement           of   SEC           Rule       17a-5


                                                                                                                                         Note       If    any      of   the        information             shown             on    the     mailing       label

                                                                                                                                         requires          correction               please         e-mail                    corrections            to
                                                                                                                                                                                                                   any
                         052490              FINRA         DEC                                                                           form@sipc.org                  and        soindicate              on     the        form        filed

                         WELLS     NELSON ASSOCIATES LLC                                              1414
                         THE    H1GHTOWER  BLDG
                         105      HUDSON             AVE STE 600                                                                         Name       and      telephone                number          of     person           to     contact

                         OKLAHOMA                 CI1Y    OK 73102-4817                                                                  respecting             this    form


                                                                                                                          _J             Edward              Wells                      405                2399000


              General           Assessment                             2e    from page                     not    less        than    $150       minimum                                                                          9551.00

              Less        payment            made        with    SPC-6            filed        including        $150     paid    with     2009      SIPC-4          exclude             Interest
                                                                                                                                                                                                                              1052.00

                    Jui           21              2009
                                Date          Paid

              Less        prior        overpayment               applied


              Assessment                 balance           due     or    overpayment                                                                                                                                              8499.00

              Interest          computed             on     late       payment            see         instruction                for              days        at    20% per annum


              Total       assessment                 balance           and    interest               due   or overpayment                    carried       forward
                                                                                                                                                                                                                                  8499.00

              PAID WITH   TI-uS  FORM
              Check enclosed    payable                            to    SIPC
              Total must be same as                                    above                                                                  8499.00

              Overpayment                    carried       forward
                                                                                                                                             ___________________________



      SubsidiarIes                       and       predecessors                           included         in    this    form give           name and              1934       Act       registration               number




The SIPC member                         submitting              this   form and                the

person by whom                    it    is    executed           represent            thereby
                                                                                                                                         wells Nelson                                   Associates                            LLC
that    all    information               contained              herein       is    true         correct
                                                                                                                                                                    IName     of   Corporation      Partnership         or   other   organization
and     complete


                                                                                                                                                                                             AUthoniznd       Signaturn



Dated         the         20      day        of      January-                                  20    10                                  Edwaid                         Wells                President
                                                                                                                                                                                                          Title


This     form         and the assessment                           payment                Is     due 50         days     after        the end        of    the      fIscal      year             Retain           the        Working         Copy        of   thIs   form

for      period            of   not          less than             years the                   latest           years     in     an    easIly       accessibie                place



..      aes                ___________
                               Postmarked                               Received                                   Reviewed
LLI


        Calculations              _________                                                                        Documentation                 _________                                                                           Forward         Copy


c.      Exceptions


Cfl
        Disposition              of     exceptions


                                                                   DETERMINATION OF SIPC NET OPERATING                                                                                                                           REVENUES
                                                                               AND GENERAL ASSESSMENT
                                                                                                                                                                                                                                                Amounts        for   the   fiscal    period
                                                                                                                                                                                                                                                     beginning        April         2009
                                                                                                                                                                                                                                                and    ending        Dec      31           20
                                                                                                                                                                                                                                                            Eliminate       cents

 Item     No

 2a     Total    revenue                FOCUS           Line        12/Part            IA     Line             Code 4030                                                                                                                        $398398749                        ______

 2b     Additions

                      Total        revenues            from         the    securities                  business           of    subsidiaries                except               foreign        subsidiaries                and

                      predecessors                    not       Included         above


                      Net     toss       from        principal            transactions                  In   securities           in    trading            accounts


                      Net        loss    from        principal            transactions                  in   commodities                 In
                                                                                                                                               trading           accounts


                      Interest           and        dividend         expense                deducted           in    determining                    item        2a


                      Net        loss    from                                    of                                        In    the                                             distribution           of    securities
                                                     management                        or        participation                           underwriting                      or




                      Expenses                other     than                                      printing          registration                   fees     and                     tees    deducted            In                        net
                                                                    advertising                                                                                        legal                                          determining

                      profit       from        management                   of   or participation                    in    underwriting                    or    distribution              of   securities



                      Net     loss       from        securities            in    investment                  accounts


                                  Total        additions



2c Deductions
                      Revenues                from     the        distribution              of     shares       of
                                                                                                                           registered                open        end            investment                             or    unit
                                                                                                                                                                                                  company
                      investment                   trust     from        the     sale        of    variable          annuities                from        the        business         of                             from        investment
                                                                                                                                                                                            insurance

                                             services           rendered          to        registered          Investment                                                      insurance
                      advisory                                                                                                            companies                     or                        company             separate

                      accounts                and     from        transactions                    in   security       futures           products                                                                                                        51399.26

                      Revenues                from     commodity                 transactions




                      Commissions                    floor        brOkerage                and         clearance          paid     to    other            SIPC members                     in   connection                with

                      securities              transactions                                                                                                                                                                                              9983.11

                      Reimbursements                        for    postage            in     connection              with       proxy         solicitation



                      Net    gain        from        securities            in    investment                  accounts


                      100%         of    commissions                 and         markups               earned        from        transactions                   in              certificates       of
                                                                                                                                                                                                         deposit            and

                             Treasury               bUis        bankers                                        or commercial                                                 mature        nine    months                   less
                      ii                                                         acceptances                                                       paper         that                                                or


                      from        issuance            date


                      Direct        expenses               of    printing        advertising                 and     legal        fees         incurred              in     connection           with        other     revenue

                      related           to    the    securities            business                revenue            defined           by         Section           169L             of the      Act

                  Other            revenue            not       related         either                         or                             to    the     securities              business
                                                                                              directly               indirectly


                 See             instruction




                            Total       interest           and      dividend            expense              FOCUS              Line      22/PART                    IIA     Line    13
                            Code         4075         plus        line    2b4          above             but    not       in    excess

                            of    total        interest          and      dividend               income                                                                    $_    12597_5f

                  II 40%                of    interest           earned          on    customers               securities              accounts

                            40%          of    FOCUS              line           Code         3960                                                                         $_______________


                            Enter            the    greater         of    line              or                                                                                                                                                          12597.56
                                                                                                  ii                                                                                                                                                                                ______
                            Total        deductions                                                                                                                                                                                                    163579.93

2d    SIPC      Net     Operating                  Revenues                                                                                                                                                                                      3204O7.56
28    General         Assessment                        .0025                                                                                                                                                                                   L_          9551.02                      ____
                                                                                                                                                                                                                                                               but   not   less   than
                                                                                                                                                                                                                                                to   page
                                                                                                                                                                                                                                                $150   minimum


WELLS NELSON    ASSOCIATES   LLC


        December 31 2009




Report Pursuant   to Rule   17a5



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