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Regulatory Obligations Exchange Act Rule 15c3-1 (Net Capital Rule) requires that member firms must at all times have and maintain net capital at no less than the levels specified pursuant to the rule to protect customers and creditors from monetary losses that can occur when firms fail.

Non-allowable assets are illiquid assets, assets that cannot be quickly sold at fair market value. These include fixed assets, receivables, and assets that are unlikely to be collected. Because non-allowable assets should not be included in net capital, their value must be subtracted from net worth.

Nonallowable assets are assets not readily convertible into cash (e.g., fixed assets, intercompany receivables, securities not readily marketable, unsecured receivables (certain receivables are allowable for the first 30 days)).

(2) The term net capital shall be deemed to mean the net worth of a broker or dealer, adjusted by: (i) Adjustments to net worth related to unrealized profit or loss, deferred tax provisions, and certain liabilities.

Rule 17a-5 requires member firms to file annual financial reports with the SEC and FINRA known as FOCUS reports. FOCUS report stands for Financial and Operational Combined Uniform Single report.

Non-Allowable Asset – An asset that is not readily convertible into cash. For net capital purposes, it reduces the firm's net worth. Such assets could be accounts receivable that are not collected within 30 day period.

17a-5(a)(1)(iii)/01 NYSE FOCUS Filing Due Dates. The NYSE requires their member and member organizations, who have chosen to file their FOCUS Part IIA as of a date other than the last calendar day of a month or quarter, to file their FOCUS Report 17 business days from their month-end closing date.

SEC Form X-17A-5 is a financial reporting form that all broker-dealers who are registered with the U.S. Securities and Exchange Commission (SEC) must complete. This form consists of three parts and contains an annual audit that must be performed by a certified public accountant (CPA).