Liabilities Subordinated to Claims of General Creditors

12 Months Ended

Dec. 31, 2012

Liabilities Subordinated to Claims of General Creditors [Abstract]

LIABILITIES SUBORDINATED TO CLAIMS OF GENERAL CREDITORS

NOTE 9 – LIABILITIES SUBORDINATED TO CLAIMS OF GENERAL CREDITORS

Liabilities subordinated to claims of general creditors as of December 31, 2012 and 2011 consist of:

	2012		2011
Capital notes 7.33%, due in annual installments of $50,000 commencing on June 12, 2010 with a final installment on June 12, 2014	$	100,000	$	150,000
	$	100,000	$	150,000

Required annual principal payments, as of December 31, 2012, are as follows:

2013	$	50,000
2014		50,000
2015		—
2016		—
2017		—
Thereafter		—
	$	100,000

The capital note agreements contain restrictions which, among other things, require Edward Jones to maintain certain financial ratios, restrict encumbrance of assets and creation of indebtedness and limit the withdrawal of its partnership capital. As of December 31, 2012, Edward Jones was required, under the note agreements, to maintain minimum partnership capital subject to mandatory redemption of $400,000 and regulatory net capital of $156,833. Edward Jones was in compliance with all restrictions as of December 31, 2012 and 2011.

The liabilities subordinated to claims of general creditors are subject to cash subordination agreements approved by Financial Industry Regulatory Authority (“FINRA”) and, therefore, are included in Edward Jones’ computation of net capital under the SEC’s Uniform Net Capital Rule.

In June 2012, the Partnership paid the annual scheduled installment on the 7.33% capital notes in the amount of $50,000.