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Note 16 - Net Capital Requirements
9 Months Ended
Jun. 30, 2011
Schedule of Capitalization [Table Text Block]
NOTE 16. NET CAPITAL REQUIREMENTS

National Securities, as a registered broker-dealer, is subject to the SEC’s Uniform Net Capital Rule 15c3-1 that requires the maintenance of minimum net capital.  National Securities has elected to use the alternative standard method permitted by the rule.  This requires that National Securities maintain minimum net capital equal to the greater of $250,000 or a specified amount per security based on the bid price of each security for which National Securities is a market maker.  At June 30, 2011, National Securities had net capital of approximately $1,545,000 which exceeded its requirement by approximately $1,295,000.

In addition to the net capital requirements, each of vFinance Investments and EquityStation are required to maintain a ratio of aggregate indebtedness to net capital, as defined, of not more than 15 to 1 (and the rule of the “applicable” exchange also provides that equity capital may not be withdrawn or cash dividends paid if the resulting net capital ratio would exceed 10 to 1).  At June 30, 2011, vFinance Investments had net capital of approximately $1,486,000 which was approximately $486,000 in excess of its required net capital of $1,000,000 and its percentage of aggregate indebtedness to net capital was 296%.  At June 30, 2011, EquityStation had net capital of approximately $209,000 which was approximately $109,000 in excess of its required net capital of $100,000 and its percentage of aggregate indebtedness to net capital was 107%.  Each of the Broker Dealer subsidiaries qualifies under the exemptive provisions of Rule 15c3-3 under Section (k)(2)(ii) of the Rule, as none of them carry the accounts of their customers on their books nor perform custodial functions related to customer securities.

Advances, dividend payments and other equity withdrawals from its broker dealer subsidiaries are restricted by the regulations of the SEC, and other regulatory agencies.  These regulatory restrictions may limit the amounts that a subsidiary may dividend or advance to the Company.