Capital Financial (CPFH) 10-K 18 Apr 18 2017 FY Annual report Financial data

Document and Entity Information

Document and Entity Information - USD ($)	12 Months Ended
	Dec. 31, 2017	Mar. 30, 2018	Mar. 15, 2018
Reduction in goodwill related to UHFS acquisition (See Note 5-Business Acquisitions)
Entity Registrant Name	Capital Financial Holdings, Inc
Entity Central Index Key	944,696
Document Type	10-K
Document Period End Date	Dec. 31, 2017
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Is Entity a Well-known Seasoned Issuer?	No
Is Entity a Voluntary Filer?	No
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Smaller Reporting Company
Entity Public Float		$ 529,100
Entity Common Stock, Shares Outstanding			1,241
Document Fiscal Period Focus	FY
Document Fiscal Year Focus	2,017

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($)	Dec. 31, 2017	Dec. 31, 2016
CURRENT ASSETS
Cash and cash equivalents	$ 1,794,896	$ 1,368,176
Accounts receivable (net of allowance for doubtful accounts of $24,000 for 2017 and 2016)	1,824,995	1,932,933
Prepaids	55,466	61,709
Current assets of discontinued operations	0	6,375
Total Current Assets	3,675,357	3,369,193
PROPERTY AND EQUIPMENT
Land	98,409	98,409
Building	1,096,946	875,682
Furniture, fixtures and equipment	348,363	543,601
Less accumulated depreciation	(271,747)	(422,058)
Property and equipment of discontinued operations	0	72,616
Net property and equipment	1,271,971	1,168,250
OTHER ASSETS
Deferred tax asset - non-current	187,931	417,542
Total other assets	187,931	417,542
TOTAL ASSETS	5,135,259	4,954,985
CURRENT LIABILITIES
Accounts payable	496,875	292,987
Commissions payable	2,029,467	2,027,962
Income taxes payable	10,859	10,187
Other current liabilities	1,749	12,963
Current liabilities of discontinued operations	0	7,434
Total current liabilities	2,538,951	2,351,533
NON CURRENT LIABILITIES
Building mortgage	672,426	475,000
Non current liabilities of discontinued operations	0	2,907
Total noncurrent liabilities	672,426	477,907
TOTAL LIABILITIES	3,211,377	2,829,440
STOCKHOLDERS' EQUITY
Series A Preferred stock – 5,000,000 shares authorized, $.0001 par value; 3,050,000 shares issued and 0 outstanding	305	305
Additional paid in capital – series A preferred stock	1,524,695	1,524,695
Common stock – 1,000,000,000 shares authorized, $.0001 par value 1,241 and 1,241 shares issued and outstanding, respectively	1,241	1,241
Additional paid in capital – common stock	10,221,515	10,221,515
Accumulated deficit	(8,523,873)	(8,322,211)
Less Treasury stock, 3,050,000 preferred shares at $0.4262	(1,300,000)	(1,300,000)
TOTAL STOCKHOLDERS' EQUITY	1,923,883	2,125,545
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$ 5,135,259	$ 4,954,985

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($)	Dec. 31, 2017	Dec. 31, 2016
CURRENT ASSETS
Allowance for doubtful accounts	$ 24,000	$ 24,000
STOCKHOLDERS' EQUITY
Series A Preferred stock, par value	$ .0001	$ 0.0001
Series A Preferred stock shares authorized	5,000,000	5,000,000
Series A Preferred stock shares issued	3,050,000	3,050,000
Series A Preferred stock shares outstanding	0	0
Common stock, par value	$ 0.0001	$ 0.0001
Common stock shares authorized	1,000,000,000	1,000,000,000
Common stock shares issued	1,241	1,241
Common stock shares outstanding	1,241	1,241
Treasury stock	3,050,000	3,050,000
Trrasury stock, par value	$ 0.4262	$ 0.4262

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
OPERATING REVENUES
Fee income	$ 1,616,970	$ 1,227,001
Commission income	13,481,827	15,946,037
Other income	156,932	50,329
Other fee income	313,462	335,122
Total revenue	15,569,191	17,558,489
EXPENSES
Compensation and benefits	1,458,152	1,490,033
Commission expense	12,739,243	14,987,254
General and administrative expenses	1,307,222	1,352,032
Depreciation	62,705	47,796
Loss on Disposal of Assets	4,195	0
Total operating expenses	15,571,517	17,877,115
INCOME (LOSS) OF CONTINUING OPERATIONS	(2,326)	(318,626)
OTHER INCOME (EXPENSES)
Interest expense	(29,039)	(2,814)
Total other income (expenses)	(29,039)	(2,814)
INCOME (LOSS) OF CONTINUING OPERATIONS BEFORE INCOME TAX	(31,365)	(321,440)
INCOME TAX BENEFIT (EXPENSE)	(85,933)	61,542
NET INCOME (LOSS) BEFORE DISCONTINUED OPERATIONS	(117,298)	(259,898)
DISCONTINUED OPERATIONS	(22,315)	(157,863)
NET INCOME (LOSS)	$ (139,613)	$ (417,761)
Net income (loss) per common share, basic and diluted:
Continuing	$ (95)	$ (209)
Discontinued	$ (18)	$ (127)
Weighted average common shares outstanding:
Basic and diluted	1,241	1,241

CONSOLIDATED STATEMENTS OF STOC

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($)	Preferred stock and additional paid-in capital	Common stock and additional paid-in capital	Accumulated Deficit	Treasury stock and additional paid-in capital	Total
Balance, beginning of year at Dec. 31, 2015	$ 1,525,000	$ 10,222,756	$ (7,904,450)	$ (1,300,000)	$ 2,543,306
Balance, Shares beginning of year at Dec. 31, 2015	3,050,000	1,241
Preferred stock issued	$ 0				0
Preferred stock issued, shares	0
Purchase of preferred stock	$ 0				0
Net income (loss)			(417,761)		(417,761)
Balance, end of year at Dec. 31, 2016	$ 1,525,000	$ 10,222,756	(8,322,211)	(1,300,000)	2,125,545
Balance, shares end of year at Dec. 31, 2016	3,050,000	1,241
Preferred stock issued	$ 0				0
Preferred stock issued, shares	0
Purchase of preferred stock	$ 0				0
Net income (loss)			(139,613)		(139,613)
Capital dividends			(62,050)		(62,050)
Balance, end of year at Dec. 31, 2017	$ 1,525,000	$ 10,222,756	$ (8,523,874)	$ (1,300,000)	$ 1,923,883
Balance, shares end of year at Dec. 31, 2017	3,050,000	1,241

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss)	$ (139,613)	$ (417,761)
Adjustments to reconcile net income (loss) to net cash provided (used) by operating activities:
Depreciation	62,705	48,412
Impairment on discontinued operations	0	190,094
Depletion	0	18,887
Provision (benefit) for deferred income taxes	229,611	(175,966)
Effects on operating cash flows due to changes in:
Accounts receivable	107,938	(134,109)
Income taxes payable (receivable)	672	(51,480)
Prepaids	12,618	51,311
Severance Escrow	0	(258)
Commissions Payable	1,505	315,853
Accounts Payable	203,888	144,109
Other liabilities	(18,649)	(11,403)
Net cash provided by (used for) operating activities	460,675	(22,311)
CASH FLOWS FROM INVESTING ACTIVITIES
Disposal (Purchase) of property and equipment	54,840	(22,313)
Purchase of building	(221,264)	(984,091)
Payment received on notes receivable	0	500,000
Net cash used for investing activities	(166,424)	(506,404)
CASH FLOWS FROM FINANCING ACTIVITIES
Dividends paid	(62,050)	0
Proceeds from long-term borrowing	194,519	475,000
Payments on short-term borrowing	0	(50,000)
Net cash provided by (used for) financing activities	132,469	425,000
CASH ADJUSTMENT FROM CHANGE IN ACCOUNT CLASSIFICATION
Reclassification of Employee Severance Escrow Account from Other Assets to Cash and Cash Equivalents	0	258,186
Reclassification of Clearing Account Deposits From Other Assets to Cash and Cash Equivalents	0	179,279
Net cash adjustment by reclassification of accounts	0	433,465
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	426,720	329,750
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR	1,368,176	1,038,426
CASH AND CASH EQUIVALENTS AT END OF YEAR	1,794,896	1,368,176
SUPPLEMENTARY DISCLOSURE OF CASH FLOW INFORMATION
Cash paid during the year for: Interest	29,039	2,814
Cash paid during the year for: Income taxes	10,187	73,750
SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITIES
Impairment on discontinued operations	$ 0	$ 190,094

1. NATURE OF OPERATIONS AND SIG

1. NATURE OF OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES	12 Months Ended
	Dec. 31, 2017
PromissoryNoteNonCurrent
NATURE OF OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES	The nature of operations and significant accounting policies of Capital Financial Holdings, Inc., and its Subsidiaries are presented to assist in understanding the Company’s consolidated financial statements. Nature of operations Broker-Dealer Services The Company derives all of its operating revenues from Capital Financial Services, Inc. through investment advisory fees as well as commissions earned from sales of mutual funds, insurance products, and various other securities. CFS is a full-service brokerage firm. CFS is registered with the SEC as an investment advisor and broker-dealer and also with FINRA as a broker-dealer. CFS specializes in providing investment products and services to independent investment representatives, financial planners, and investment advisors and currently supports approximately 144 investment representatives and investment advisors. The Company operates under the provision of Paragraph (k)(2)(ii) of Rule 15c3-3 of the Securities and Exchange Commission and, accordingly, is exempt from the remaining provisions of that rule. To the best of management’s knowledge and belief the Company met the identified exemption provisions from January 1, 2017 to December 31, 2017 without exception. Holding Company The Company encompasses cost associated with ownership of its office building, business development and acquisitions, dispositions of subsidiary entities and results of discontinued operations, dividend income and recognized gains or losses. Principles of consolidation Concentrations Use of estimates Fair Value of Financial Instruments Revenue recognition Cash and cash equivalents Clearing Deposits Accounts Receivable Goodwill Property and equipment Other assets Advertising Earnings per common share Income taxes Severance Escrow Reclassification , . Concentration of Credit Risk Recent Accounting Developments ASU 2014-15— Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. ASU 2016-02 — Leases (Topic 842): Leases ASU 2016-12— Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients. Revenue from Contracts with Customers (Topic 606) Revenue from Contracts with Customers Revenue Recognition, ASU 2016-15— Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. ASU 2016-17— Consolidation (Topic 810): Interests Held through Related Parties That Are under Common Control. ASU 2016-18— Statement of Cash Flows (Topic 230): Restricted Cash (a consensus of the FASB Emerging Issues Task Force). ASU 2017-01— Business Combinations (Topic 805): Clarifying the Definition of a Business.

2. CASH AND CASH EQUIVALENTS

2. CASH AND CASH EQUIVALENTS	12 Months Ended
	Dec. 31, 2017
PromissoryNoteNonCurrent
CASH AND CASH EQUIVALENTS	Cash and cash equivalents at December 31, 2017 and 2016 consist of checking and savings accounts of $1,461,706 and $934,711, respectively. At December 31, 2017 and 2016, the Company had severance escrow balances of $157,911 and $258,185, respectively. The Company’s severance escrow accounts are restricted cash held in third-party administered escrow accounts for the sole purpose of funding certain employee severance plans which are included in Cash and cash equivalents. The Company had deposit accounts with clearing firms of $100,000, $35,000 and $40,279 with Pershing, Dain and NSCC, respectively on December 31, 2017 and December 31, 2016 which are included in Cash and cash equivalents.

3. PROPERTY AND EQUIPMENT

3. PROPERTY AND EQUIPMENT	12 Months Ended
	Dec. 31, 2017
PromissoryNoteNonCurrent
PROPERTY AND EQUIPMENT	Property and equipment at December 31, 2017 and 2016, consists of the following: 2017 2016 Office furniture and equipment $ 348,363 $ 543,601 Land 98,409 98,409 Building 1,096,946 875,682 Accumulated depreciation (271,747 ) (422,058 ) Property and equipment of discontinued operations — 72,616 $ 1,271,971 $ 1,168,250 Depreciation expense for continuing operations totaled $62,705 and $47,796 in 2017 and 2016, respectively.

4. BUSINESS VENTURES

4. BUSINESS VENTURES	12 Months Ended
	Dec. 31, 2017
PromissoryNoteNonCurrent
BUSINESS VENTURES	On June 9, 2014, the Company launched a new wholly-owned operating subsidiary, Capital Natural Resources, Inc. (“CNR”), by acquiring 1,000,000 shares, .001 par value common stock of Capital Natural Resources, Inc. for the amount of $100,000. Capital Natural Resources, Inc. sought opportunities related to natural resources in the United States, including petroleum, natural gas and/or other minerals, water resources and land. In the fourth quarter of 2016 the Company determined to dispose of its natural resource assets. On April 1, 2015, CNR obtained a non-operating working interest in an oil and gas property consisting of three oil and gas leases in Taylor County, Texas for a purchase price of $90,000 paid in cash. On December 1, 2015, CNR purchased a non-operating working interest in the Kifer Rozella 1, producing oil well, located in the County of Gonzales, state of Texas. The purchase price of $100,000 for CNR’s interest was paid by $50,000 by a promissory note and deed of trust carried by the Seller, Origin Production Company, Inc. Said promissory note has an annual interest rate of 10% per annum and is payable in monthly installment of approximately $1,062 beginning January 1, 2016 with final maturity on December 1, 2020. On February 1, 2016, the Company paid off the promissory note in the amount of approximately $50,847 bringing the balance of the note to zero. Total interest paid on the promissory note was approximately $847. On July 28, 2015, CNR acquired five year oil and gas leases located in Williams County, North Dakota and two tracts located in Divide County, North Dakota for a combined acquisition cost of $7,676, including lease bonus and prepaid annual rentals. The oil and gas leases were obtained from the State of North Dakota Department of Trust Lands. The leases grant the right to conduct oil and gas operations and extract oil and gas from the property with payment of royalty to the lessor of 3/16 of oil and gas produced. On August 20, 2015, CNR acquired a five year oil and gas lease located in Lincoln County, Colorado at an initial acquisition cost of $1,652 including the first annual rental payment of $1,600. The oil and gas lease was obtained from the Colorado State Board of Land Commissioners. The lease grants the right to conduct oil and gas operations and extract oil and gas from the property with payment of royalty to the lessor of 1/6 of oil and gas produced. The oil and gas leases in North Dakota and Colorado are currently non-producing properties and non-operating leases. The purchase allocation for all four CNR oil and gas lease transactions was based on the estimated fair value of the assets acquired. On May 19, 2015, CNR acquired interests in coal rights located in Kanawha County, West Virginia with 1,483,451 recoverable tons for a purchase price of $1,275 paid in cash. On June 11, 2015, CNR acquired mineral, water rights and surface interests in Hudspeth County, Texas for a purchase price of $83,350 paid in cash. In the fourth quarter of 2016 the Company determined to dispose of its natural resource segment. In the first quarter of 2017 all of the natural resource assets described above were sold for $66,200 with an effective date of transfer of December 31, 2016 in accordance with industry practice. As of December 31, 2016, CNR met the definition of a discontinued operation.

5. DISCONTINUED OPERATIONS

5. DISCONTINUED OPERATIONS	12 Months Ended
	Dec. 31, 2017
Discontinued Operations
DISCONTINUED OPERATIONS	On March 2 and 3, 2017, the Company sold the assets in its natural resource segment, Capital Natural Resources, Inc. The sale included all of the leases and coal, mineral, water and surface interests with an effective date of December 31, 2016 in accordance with industry practice. The summarized balance sheet for discontinued operations is presented below: 2017 2016 Current Assets Accounts receivable — $ 5,626 Prepaids — 749 Total current assets — $ 6,374 Property and Equipment Oil and natural gas properties, Full Cost Method of Accounting — $ 61,829 Less accumulated depletion — (29,354 ) Equipment — 4,690 Less accumulated depreciation — (816 ) Other property holdings — 36,267 Net property and equipment — $ 72,616 Total Assets — $ 78,990 Current liabilities Accounts payable — $ 7,434 Total current liabilities — $ 7,434 Noncurrent liabilities Asset retirement obligation — $ 2,907 Total noncurrent liabilities — $ 2,907 Stockholder’s Equity Common Stock — $ 300,400 Accumulated deficit — (231,751 ) Total stockholder’s equity — $ 68,649 Total liabilities and stockholder’s equity — $ 78,990 The results of operations of Capital Natural Resources, Inc. are included in the Company’s Consolidated Statements of operations as discontinued operations. The Company recorded impairment on the assets held for sale as of December 31, 2016. The proceeds of the sale, after giving effect to any working capital adjustments, were allocated among the Holding Company. The summarized income from discontinued operations is presented below: 2017 2016 Operating Revenues Oil lease income — $ 64,785 Total operating revenue — $ 64,785 Operating Expenses Compensation and benefits $ — $ 55,097 Impairment — 190,094 Lease operating expense — 73,256 General and administrative 22,315 9,088 Depletion — 18,887 Depreciation — 616 Total operating expenses $ 22,315 $ 347,038 Operating loss $ (22,315 ) $ (282,253 ) Other income (expenses) Interest expense — $ (847 ) Interest income — 16,206 Total other income (expenses) $ — $ 15,359 Income (Loss) of discontinued operations before income tax expense $ (22,315 ) $ (266,894 ) Income tax (expense) benefit — $ 109,031 Net income (loss) $ (22,315 ) $ (157,863 ) The Company did not reclassify its Statements of Cash Flows to reflect the various discontinued operations. Cash flows from 2016 are combined with the cash flows from continuing operations within each of the categories presented. Cash flows from discontinued operations are as follows: Net cash provided by operating activities $ – Net cash provided by investing activities $ 66,200 Net cash used for financing activities $ –

6. LINE OF CREDIT

6. LINE OF CREDIT	12 Months Ended
	Dec. 31, 2017
Debt Disclosure [Abstract]
LINE OF CREDIT	On September 12, 2016, the Company obtained a one year term line of credit with American Bank Center in the amount of $500,000. The line of credit had a variable interest rate of 1.509 percent above Wall Street Journal U.S. Prime Rate which was 3.5% as of December 31, 2016. The line of credit expired on September 12, 2017 without being utilized. For the periods ended December 31, 2017 and December 31, 2016, the Company had no outstanding balance against this line of credit. As of December 31, 2017, the Company had zero outstanding and zero interest expense against the expired line of credit. There were no financial covenants associated with the line of credit.

7. INCOME TAXES

7. INCOME TAXES	12 Months Ended
	Dec. 31, 2017
PromissoryNoteNonCurrent
INCOME TAXES	The provision for income taxes is based on earnings before income taxes reported for financial statement purposes and consisted of the following: 2017 2016 Current income tax expense: Federal $ – $ – State 10,859 10,238 Total current tax expense $ 10,859 $ 10,238 Deferred tax expense: Federal $ (123,124 ) $ (162,337 ) State (18,468 ) (23,867 ) Total deferred tax expense $ (141,592 ) $ (186,204 ) Total provision (benefit) for income tax expense $ (141,592 ) $ (175,966 ) Deferred taxes arise because of different tax treatment between financial statement accounting and tax accounting, known as “temporary differences.” The Company records the tax effect of these temporary differences as “deferred tax assets” (generally items that can be used as a tax deduction or credit in future periods) and “deferred tax liabilities” (generally items for which the Company has received a tax deduction and has not yet been recorded in the consolidated statement of income). Deferred tax assets (liabilities) were comprised of the following: 2017 2016 Deferred tax asset: Net operating loss carryforward 49,344 135,209 Intangibles – 32,111 Stock option compensation 152,895 211,523 Other assets – 74,517 Total deferred tax assets $ 202,239 $ 453,360 Deferred tax liabilities: Plant, property and equipment $ (14,308 ) $ (35,818 ) Total deferred tax liabilities $ (14,308 ) $ (35,818 ) Net deferred tax asset Net deferred tax asset – non-current $ 187,931 $ 417,542 Net deferred tax asset $ 187,931 $ 417,542 Management reviews and adjusts those estimates annually based upon the most current information available. However, because the recoverability of deferred taxes is directly dependent upon the future operating results of the Company, actual recoverability of deferred taxes may differ materially from management’s estimates. The Company is aware of the risk that the recorded deferred tax assets may not be realizable. The capital loss generated on the sale of Omega shares is unlikely to be recognized and therefore has not been included in deferred assets. However, management believes that the Company will obtain the full benefit of any net operating loss and other deferred tax assets on the basis of its evaluation of the Company’s anticipated profitability over the period of years that the temporary differences are expected to become tax deductions. It believes that sufficient book and taxable income will be generated to realize the benefit of any net operating loss and other deferred tax assets. ASC 740 guidance requires that the Company evaluate all monetary tax positions taken, and recognize a liability for any uncertain tax positions that are more likely than not to be sustained by the tax authorities. The Company has not recorded any liabilities, or interest and penalties, as of December 31, 2017 related to uncertain tax positions. The Company files income tax returns in the U.S. and various state jurisdictions. There are currently no federal or state income tax examinations underway for these jurisdictions. The tax years 2014-2017 remain open to examination by taxing jurisdictions to which the Company is subject. At December 31, 2017, the Company has approximately $759,802 in federal net operation loss carryforward which begins to expire in 2036. A reconciliation of the difference between the expected federal tax rate computed at the U.S. statutory income tax rate of 35% and the Company’s effective tax rate for the years ended December 31, 2017 and 2016 is shown in the following table: 2017 2016 Expected federal tax rate 21 % 35 % State income taxes 5 % (1 )% Effect of permanent differences 0 % 0 % Change in tax rate and other 0 % (5 )% Effective tax rate 26 % 29 % Income tax payable for period ended December 31, 2016 was $10,187 compared to income tax payable of $10,859 during the same period in 2017.

8. STOCK WARRANTS, STOCK SPLITS

8. STOCK WARRANTS, STOCK SPLITS, AND STOCK OPTIONS	12 Months Ended
	Dec. 31, 2017
PromissoryNoteNonCurrent
STOCK WARRANTS, STOCK SPLITS, AND STOCK OPTIONS	The Company has authorized 210 perpetual warrants to certain organizers, directors, officers, employees and shareholders of the Company. All of these warrants were issued between 1987 and 1990 and were accounted for in accordance with the provisions of Accounting Principles Board (“APB”) Opinion No. 25, Accounting for Stock Issued to Employees. No compensation expense was recorded for these warrants as the exercise price exceeded the market price of the stock at the date of issue. The Company plans to continue to apply APB Opinion No. 25 in accounting for these warrants. These warrants, at the date of issue, allowed for the purchase of shares of stock at $2.00 per share. The exercise prices of these warrants were adjusted to reflect stock splits of 1 for 10,000 in 2013, 2 for 1 in 2002, and 11 for 10 in 1990 and 1989. 0.2 warrants (adjusted for the 1 for 10,000 stock split in 2013 and the 2 for 1 stock split in 2002) were exercised in 1997, leaving an outstanding balance of 210 warrants as of December 31, 2017. The Company had entered into employment agreements with past employees of the Company. Upon execution of these employment agreements, a one-time granting of stock options took effect. These options are fully vested and have a perpetual life. Each employment contract stated the strike price for which options were granted. In addition, the contracts granted options when the employees reach specified performance goals. The Company has also issued options to directors as well as various other employees and past employees. The options granted to employees were granted in connection with reaching certain performance goals. These options are considered to be fully vested and have a contractual life of ten years. The Company plans to issue additional common shares if any of its outstanding options are exercised. There have been no options exercised to date. The Company has adopted the FASB accounting and standards for fair value recognition provisions for stock-based employee compensation. There were no compensation costs or deferred tax benefits recognized for stock-based compensation awards for the twelve months ended December 31, 2017. As of December 31, 2017, 421 stock options totaling $1,103,600 had been cancelled. In June of 2013, shareholders approved by a majority vote a 10,000 to 1 reverse stock split during the annual meeting of shareholders. The reverse stock split became effective on August 14, 2013. Option activity for the last three years was as follows: Number of Options Weighted Average Exercise Price per Share Weighted Average Grant Date Fair Value Aggregate Intrinsic Value Outstanding on December 31, 2014 336 $ 8,692 $ 4,435 $ – Granted – – – – Exercised – – – – Canceled 129 – – – Outstanding on December 31, 2015 207 $ 8,692 $ 4,435 $ – Granted – – – – Exercised – – – – Canceled 39 – – – Outstanding on December 31, 2016 168 $ 5,000 $ 3,844 $ – Granted – – – – Exercised – – – – Cancelled – – – – Outstanding on December 31, 2017 168 $ 5,000 $ 3,844 $ – Exercisable options at the end of 2017 were 168, 168 in 2016, and 207 in 2015. The following table summarizes information concerning options outstanding and exercisable as of December 31, 2016: Range of Exercise Prices Number Outstanding Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price Number Exercisable Weighted Average Exercise Price $ 0 to $4,900 138 Perpetual $ 4,200 138 $ 4,200 $ 5,000 to $9,900 27 1 * $ 5,200 27 $ 5,200 $ 10,000 to $15,000 3 Perpetual $ 10,100 3 $ 10,100 $ 0 to $15,000 168 1 * $ 8,692 168 $ 8,692 * Excludes options with a perpetual life

9. EMPLOYEE BENEFIT PLANS

9. EMPLOYEE BENEFIT PLANS	12 Months Ended
	Dec. 31, 2017
PromissoryNoteNonCurrent
EMPLOYEE BENEFIT PLANS	The Company sponsors a 401(K) plan for all its employees. Effective January 1, 2005, the Company implemented a match of up to 4% of employee deferrals. Plan expenses paid for by the Company were $2,858 and $2,701 for the years ended December 31, 2017 and 2016, respectively. The matching contributions paid by the Company were $54,826 and $52,608 for the years ended December 31, 2017 and 2016, respectively. Effective January 1, 2016, the Company implemented a match of up to 6% of employee deferrals.

10. RULE 4110 (c)(1)

10. RULE 4110 (c)(1)	12 Months Ended
	Dec. 31, 2017
Rule 4110 C1
RULE 4110 (c)(1)	The Company operates under the provision of FINRA Rule 4410 (c)(1) and, accordingly, the member is restricted from withdrawing equity capital for a period of one year from the date such equity capital is contributed, unless otherwise permitted by FINRA in writing. Subject to the requirements of paragraph (c)(2) of this Rule, this paragraph shall not preclude a member from withdrawing profits earned. On December 28, 2016, the board of the Holding Company of Capital Financial Services, Inc. approved capital contribution in the amount of $65,000 to be transferred to the Company.

11. NET CAPITAL REQUIREMENTS

11. NET CAPITAL REQUIREMENTS	12 Months Ended
	Dec. 31, 2017
PromissoryNoteNonCurrent
NET CAPITAL REQUIREMENTS	The Company’s broker-dealer subsidiary, Capital Financial Services, Inc., is a member firm of the Financial Industry Regulatory Authority (FINRA) and is registered with the Securities and Exchange Commission (SEC) as a broker-dealer. Under the Uniform Net Capital Rule (Rule 15c3-1 under the Securities Exchange Act of 1934), the subsidiary is required to maintain a minimum net capital and a ratio of aggregate indebtedness to net capital, as defined, of not more than 15 to 1. At December 31, 2017, this subsidiary had net capital of $626,186 compared to $400,409 during the same period ended in 2016; a minimum net capital requirement of $171,851 in 2017 compared to $143,787 during the same period ended in 2016; excess net capital of $454,335 in 2017 compared to $171,851 during the same period ended in 2016 and a ratio of aggregate indebtedness to net capital of 4.1 to 1in 2017 compared to a ratio of aggregate indebtedness to net capital of 5.4 to 1 during the same period ended in 2016. The subsidiary claims exemption from Rule 15c3-3 under Section 15c3-3(k)(2)(ii), which states that all customer transactions are cleared through another broker-dealer on a fully disclosed basis. The subsidiary promptly transmits customer funds or securities to its clearing firm. Therefore, a schedule showing the Computation for Determination of Reserve Requirements under Rule 15c3-3 of the Securities and Exchange Commission and the Schedule of Information Relating to Possession or Control Requirements under Rule 15c3-3 of the Securities and Exchange Commission, are not required. We, as members of management of Capital Financial Services, Inc. (the subsidiary) are responsible for complying with 17 C.F.R §240.17a-5, “Reports to be made by certain brokers and dealers” and complying with 17 C.F.R §240.15c3-3: ((k)(2)(ii)) (the “exemption provisions”). To the best of our knowledge and belief we state the following: (1) We identified the following provisions of 17 C.F.R §15c3-3(k) under which the subsidiary claimed an exemption from 17C.F.R §240.15c3-3: ((k)(2)(ii)) (the “exemption provisions”), and (2) we met the identified exemption provisions from January 1, 2017 to December 31, 2017 without exception.

12. REGULATORY MATTERS

12. REGULATORY MATTERS	12 Months Ended
	Dec. 31, 2017
Regulatory Matters
REGULATORY MATTERS	The broker dealer (“BD”) segment of Capital Financial Services, Inc. is subject to periodic examinations by its regulator, the Securities Exchange Commission (“SEC”). During 2016, the SEC conducted a routine examination of the CFS BD. At the conclusion of its examination, the SEC issued an Examination Report with certain findings, asking the Company’s regulated entity to improve its anti-money laundering program, record additional information on the Company’s transaction blotters, and record transactions on the Company’s transaction blotters that are performed at other companies. On November 28, 2016 the broker dealer made its latest response to the routine examination report.

13. BUILDING PURCHASE

13. BUILDING PURCHASE	12 Months Ended
	Dec. 31, 2017
Building Purchase
BUILDING PURCHASE	On November 16, 2016, the Company closed on the acquisition of a commercial office building and associated property (the “Office Building”) located at 1801 Burdick Expressway West, Minot, North Dakota from Evanmark Enterprises, LLC, an entity unrelated to the Company. The contract purchase price for the Office Building was $975,000, exclusive of closing costs of $9,091, with all built-in fixtures and other furniture, fixtures and equipment in the building remaining with the property. The Company paid $509,091 at closing toward the purchase price of the Office Building with the remaining $475,000 of the purchase price financed by a commercial real estate loan from American Bank Center (“American Bank”) in the principal amount of $675,000, $475,000 of which is being applied to the purchase price of the Office Building and $200,000 of which was utilized for renovations to the building. Renovations to the building at cost of $221,264 were made in 2017 to bring the total cost of the land building to $1,195,355. The loan will carry a fixed interest rate of 4.879% per annum for five (5) years with the rate to be adjusted at the end of the five (5) year period based on the Wall Street Journal Prime interest rate plus 1.759%. American Bank has a first priority mortgage on the Office Building.

14. OPERATING LEASES

14. OPERATING LEASES	12 Months Ended
	Dec. 31, 2017
PromissoryNoteNonCurrent
OPERATING LEASES	The Company has various leases for office equipment and office space that are set to expire over the next several years through 2018. The total rent expense for these leases was $94,224 and $94,224 for December 31, 2017 and 2016, respectively. The following is a schedule by years of future minimum rental payments on operating leases as of December 31, 2017. Years ending December 31, 2018 $ 24,228 2019 4,128 2020 4,128 2021 4,128 2022 4,128 Total minimum future rental payments $ 40,740

15. GOODWILL

15. GOODWILL	12 Months Ended
	Dec. 31, 2017
PromissoryNoteNonCurrent
GOODWILL	The Company had no Goodwill recorded as of December 31, 2017 or December 31, 2016.

16. FAIR VALUE DISCLOSURES

16. FAIR VALUE DISCLOSURES	12 Months Ended
	Dec. 31, 2017
PromissoryNoteNonCurrent
FAIR VALUE DISCLOSURES	FASB ASC 820 defines fair value, establishes a framework for measuring fair value, and establishes a fair value hierarchy which prioritizes the inputs to valuation techniques. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A fair value measurement assumes that the transaction to sell the asset or transfer the liability occurs in the principal market for the asset or liability or, in the absence of a principal market, the most advantageous market. Valuation techniques that are consistent with the market, income or cost approach, as specified by FASB ASC 820, are used to measure fair value. The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value in three broad levels: ● Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities the Company has the ability to access. ● Level 2 inputs are inputs (other than quoted prices included within level 1) that are observable for the asset or liability, either directly or indirectly. ● Level 3 are unobservable inputs for the asset or liability and rely on management’s own assumptions about the assumptions that market participants would use in pricing the asset or liability. (The unobservable inputs should be developed based on the best information available in the circumstances and may include the Company’s own data.) The Company had no assets subject to Fair Value Disclosure measurement calculations at December 31, 2017 or December 31, 2016.

17. EARNINGS PER SHARE

17. EARNINGS PER SHARE	12 Months Ended
	Dec. 31, 2017
PromissoryNoteNonCurrent
EARNINGS PER SHARE	Basic earnings per share are computed by dividing earnings available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share reflect per share amounts that would have resulted if dilutive potential common stock had been converted to common stock. The following reconciles amounts reported in the financial statements: Options and warrants to purchase 378 common shares at exercise prices between $3,500 and $14,300 were outstanding at December 31, 2017, but were not included in the computation of earnings per share for the year ended December 31, 2017. For the Year Ended December 31, 2017 Income (Numerator) Shares (Denominator) Per Share Amount Income (Loss) from continuing operations $ (117,298 ) Less: preferred stock dividends – Income(Loss) available to common stockholders – Basic earnings per share (117,298 ) 1,241 $ (95 ) Effect of dilutive securities: Options and warrants – – Diluted earnings per share $ (117,298 ) 1,241 $ (95 ) For the Year Ended December 31, 2016 Income (Numerator) Shares (Denominator) Per Share Amount Income (Loss) from continuing operations $ (259,898 ) Less: preferred stock dividends – Income (Loss) available to common stockholders – Basic earnings per share (259,898 ) 1,241 $ (209 ) Effect of dilutive securities: Options and warrants – – – Income (Loss) available to common stockholders – Diluted earnings per share $ (259,898 ) 1,241 $ (209 )

18. COMPREHENSIVE INCOME (LOSS)

18. COMPREHENSIVE INCOME (LOSS)	12 Months Ended
	Dec. 31, 2017
PromissoryNoteNonCurrent
COMPREHENSIVE INCOME (LOSS)	There were no differences between net income (loss) and comprehensive income (loss).

19. RELATED PARTY TRANSACTIONS

19. RELATED PARTY TRANSACTIONS	12 Months Ended
	Dec. 31, 2017
PromissoryNoteNonCurrent
RELATED PARTY TRANSACTIONS	There were no related party transactions during the years ended December 31, 2017 or December 31, 2016.

20. LITIGATION

20. LITIGATION	12 Months Ended
	Dec. 31, 2017
Litigation
LITIGATION	The Company operates in a legal and regulatory environment that exposes it to potentially significant litigation risks. Issuers of certain alternative products sold by the Company are in Bankruptcy or may have other financial difficulties. As a result of such alleged failings of alternative products and the uncertainty of client recovery from the various product issuers, the Company is subject to several legal and/or arbitration proceedings. These proceedings include customer suits, investments alleged to be unsuitable, and bankruptcies and other issues brought by claimants. The Company vigorously contests the allegations of the various proceedings and believes that there are multiple meritorious legal and fact based defenses in these matters. Such cases are subject to many uncertainties, and their outcome is often difficult to predict, including the impact on operations or on the financial statements, particularly in the earlier stages of a case. The Company makes provisions for cases brought against it when, in the opinion of management after seeking legal advice, it is probable that a liability exists, and the amount can be reasonably estimated. The current proceedings are subject to uncertainties and, as such, the Company is unable to estimate the possible loss or range of loss that may result from the outcome of these cases; however, results in these cases that are against the interests of the Company could have a severe negative impact on the financial position of the Company. As of December 31, 2017, the Company was a defendant in seven on-going suits or arbitrations as discussed above. On January 19, 2018, the Company settled one of the aforementioned arbitration cases without admission of liability. Payment of $55,249 was made February 14, 2018, and recorded as a liability on December 31, 2017. On February 15, 2018, the Company settled another one of the aforementioned arbitration cases without admission of liability. Payment of $35,000 was made March 19, 2018, and recorded as a liability on December 31, 2017. On April 5, 2011, several broker-dealers and their principals/officers, including the Company and John Carlson, President and Chief Compliance Officer, filed a lawsuit in the Superior Court of California for Orange County against Mayer Hoffman McCann, P.C. (“Mayer Hoffman”) captioned Signature Financial Group, Inc., et al, (“Signature”) v. Mayer Hoffman McCann, P.C., et al). The lawsuit arose out of reviews of the financial statements of Medical Capital Holdings, Inc. (“Medical Capital”) by Mayer Hoffman. In June 2009, Medical Capital was sued by the U.S. Securities and Exchange Commission (“SEC” or “Commission”), a finding was made that Medical Capital was conducting a “Ponzi scheme” and a receiver was appointed to liquidate Medical Capital. The plaintiffs in the Signature lawsuit are broker-dealers and principals of broker-dealers that sold Medical Capital investments to their clients. These plaintiffs sought to recover damages from Mayer Hoffman for the losses and expenses they incurred as a result of the Medical Capital financial deceptions and resulting expenses and losses to the plaintiffs. Specific claims asserted and relief requested included fraud-intentional misrepresentation of fact/concealment of fact; negligent misrepresentation; equitable indemnity and declaratory relief. On September 23, 2014, the Plaintiffs entered into a Confidential Settlement and Mutual Release Agreement (the “Settlement Agreement”) with Mayer Hoffman and entities affiliated with Mayer Hoffman to settle the Plaintiffs’ claims against Mayer Hoffman and all affiliated parties of Mayer Hoffman. The parties acknowledged that as between the Company and Mr. Carlson, one hundred percent (100%) of the settlement proceeds paid to them was for the alleged damage or harm to goodwill (and loss of goodwill). The settlement proceeds were received on December 4, 2014 and charged against goodwill carried on the consolidated financial statements of Capital Financial Holdings, Inc., the parent of the Company. In a matter related to the Settlement Agreement, on or about October 6, 2014, the Company filed a lawsuit seeking declaratory judgment against its former errors and omission insurance carrier, Arch Specialty Insurance Company (“Arch”), in the Circuit Court of Wisconsin for Milwaukee County (Capital Financial Services, Inc. v. Arch Specialty Insurance Company). On or about November 24, 2014, Arch filed counterclaims against the Company. The actions were for declaratory relief in connection with a dispute over whether Arch was entitled to any portion of the settlement proceeds that the Company received in exchange for dismissing the lawsuit with Mayer Hoffman. On approximately September 14, 2016 the Company and Arch agreed to settle the matter, on October 14, 2016 a stipulation and Order for Dismissal was filed with the Court, and on October 24, 2016 the Court entered an order dismissing the case, including all claims, counterclaims and third party claims with prejudice with no costs assessed to any party.

21. OPERATING SEGMENTS

21. OPERATING SEGMENTS	12 Months Ended
	Dec. 31, 2017
Segment Reporting [Abstract]
OPERATING SEGMENTS	The Company organizes its business units into two reportable segments: Broker-Dealer Services and Holding Company. The broker-dealer services segment distributes securities and insurance products to retail investors through a network of registered representatives through its wholly-owned subsidiary, Capital Financial Services, Inc. (“CFS”), a Wisconsin corporation. The Holding Company encompasses cost associated with ownership of the Company’s office building, business development and acquisitions, dispositions of subsidiary entities and results of discontinued operations, dividend income and recognized gains or losses. The Company's reportable segments are strategic business units that offer different products and services. They are managed separately because each business requires different technology and marketing strategies. Capital Financial Holdings, Inc. derives the majority of its revenues and net income from sales of mutual funds, insurance products, and various other securities through Capital Financial Services, Inc. (“CFS”), the Company’s broker-dealer subsidiary. The historical results of a former subsidiary, Capital Natural Resources, Inc., which was dissolved in April of 2017, have been reflected as discontinued operations. As of, and for the year ended, December 31, 2017: Holding Company Broker-Dealer Services Total Revenues from external customers $ – $ 15,569,191 $ 15,569,191 Interest expense (29,039 ) – (29,039 ) Depreciation 21,357 41,349 62,705 Income (loss) before income tax benefit (expense) (336,728 ) 305,363 (31,365 ) Income tax benefit (expense) 16,409 (102,342 ) (85,933 ) Net income (loss) of continued operations (320,319 ) 203,021 (117,298 ) Segment assets of continued operations 1,638,344 3,496,915 5,135,259 As of, and for the year ended, December 31, 2016: Holding Company Broker-Dealer Services Total Revenues from external customers $ – $ 17,173,038 $ 17,173,038 Other fee income – 334,882 334,882 Other income (3,462 ) 54,031 50,569 Interest expense (2,814 ) – (2,814 ) Depreciation 3,238 44,558 47,796 Income (loss) before income tax benefit (expense) (587,553 ) 277,151 310,402 Income tax benefit (expense) 170,185 (108,643 ) 61,542 Net income (loss) of continued operations (428,406 ) 168,508 (259,898 ) Segment assets of continued operations 1,662,726 3,177,059 4,839,785 Reconciliation of Segment Information 2017 2016 Assets for the Holding Company segment $ 1,638,344 $ 1,662,726 Assets for the Broker-Dealer Services segment $ 3,496,915 $ 3,177,059 Elimination for the Holding Company segment receivables $ – $ (243,392 ) Elimination for the Broker-Dealer Services segment receivables $ – $ (5,000 ) Consolidated assets of continued operations $ 5,135,259 $ 4,591,393

22. SUBSEQUENT EVENTS

22. SUBSEQUENT EVENTS	12 Months Ended
	Dec. 31, 2017
PromissoryNoteNonCurrent
SUBSEQUENT EVENTS	The Company has evaluated subsequent events through the date the financial statements were available to be issued and have not identified any significant subsequent events.

1. NATURE OF OPERATIONS AND S29

1. NATURE OF OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES (Policies)	12 Months Ended
	Dec. 31, 2017
PromissoryNoteNonCurrent
Nature of operations	Nature of operations Broker-Dealer Services The Company derives all of its operating revenues from Capital Financial Services, Inc. through investment advisory fees as well as commissions earned from sales of mutual funds, insurance products, and various other securities. CFS is a full-service brokerage firm. CFS is registered with the SEC as an investment advisor and broker-dealer and also with FINRA as a broker-dealer. CFS specializes in providing investment products and services to independent investment representatives, financial planners, and investment advisors and currently supports approximately 144 investment representatives and investment advisors. The Company operates under the provision of Paragraph (k)(2)(ii) of Rule 15c3-3 of the Securities and Exchange Commission and, accordingly, is exempt from the remaining provisions of that rule. To the best of management’s knowledge and belief the Company met the identified exemption provisions from January 1, 2017 to December 31, 2017 without exception. Holding Company The Company encompasses cost associated with ownership of its office building, business development and acquisitions, dispositions of subsidiary entities and results of discontinued operations, dividend income and recognized gains or losses.
Principles of consolidation	Principles of consolidation
Concentrations	Concentrations
Use of estimates	Use of estimates
Fair Value of Financial Instruments	Fair Value of Financial Instruments
Revenue recognition	Revenue recognition
Cash and cash equivalents	Cash and cash equivalents
Clearing Deposits	Clearing Deposits
Accounts receivable	Accounts Receivable
Goodwill	Goodwill
Property and equipment	Property and equipment
Other assets	Other assets
Advertising	Advertising
Earnings per common share	Earnings per common share
Income taxes	Income taxes
Severance Escrow	Severance Escrow
Reclassification	Reclassification , .
Concentration of Credit Risk	Concentration of Credit Risk
Recent Accounting Developments	Recent Accounting Developments ASU 2014-15— Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. ASU 2016-02 — Leases (Topic 842): Leases ASU 2016-12— Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients. Revenue from Contracts with Customers (Topic 606) Revenue from Contracts with Customers Revenue Recognition, ASU 2016-15— Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. ASU 2016-17— Consolidation (Topic 810): Interests Held through Related Parties That Are under Common Control. ASU 2016-18— Statement of Cash Flows (Topic 230): Restricted Cash (a consensus of the FASB Emerging Issues Task Force). ASU 2017-01— Business Combinations (Topic 805): Clarifying the Definition of a Business.

3. PROPERTY AND EQUIPMENT (Tabl

3. PROPERTY AND EQUIPMENT (Tables)	12 Months Ended
	Dec. 31, 2017
Property And Equipment Tables
Property and equipment	2017 2016 Office furniture and equipment $ 348,363 $ 543,601 Land 98,409 98,409 Building 1,096,946 875,682 Accumulated depreciation (271,747 ) (422,058 ) Property and equipment of discontinued operations — 72,616 $ 1,271,971 $ 1,168,250

5. DISCONTINUED OPERATIONS (Tab

5. DISCONTINUED OPERATIONS (Tables)	12 Months Ended
	Dec. 31, 2017
Discontinued Operations Tables
Discontinued operations assets and liabilities	2017 2016 Current Assets Accounts receivable — $ 5,626 Prepaids — 749 Total current assets — $ 6,374 Property and Equipment Oil and natural gas properties, Full Cost Method of Accounting — $ 61,829 Less accumulated depletion — (29,354 ) Equipment — 4,690 Less accumulated depreciation — (816 ) Other property holdings — 36,267 Net property and equipment — $ 72,616 Total Assets — $ 78,990 Current liabilities Accounts payable — $ 7,434 Total current liabilities — $ 7,434 Noncurrent liabilities Asset retirement obligation — $ 2,907 Total noncurrent liabilities — $ 2,907 Stockholder’s Equity Common Stock — $ 300,400 Accumulated deficit — (231,751 ) Total stockholder’s equity — $ 68,649 Total liabilities and stockholder’s equity — $ 78,990
Summary of the impairment calculation on the discontinued assets held for sale	2017 2016 Operating Revenues Oil lease income — $ 64,785 Total operating revenue — $ 64,785 Operating Expenses Compensation and benefits $ — $ 55,097 Impairment — 190,094 Lease operating expense — 73,256 General and administrative 22,315 9,088 Depletion — 18,887 Depreciation — 616 Total operating expenses $ 22,315 $ 347,038 Operating loss $ (22,315 ) $ (282,253 ) Other income (expenses) Interest expense — $ (847 ) Interest income — 16,206 Total other income (expenses) $ — $ 15,359 Income (Loss) of discontinued operations before income tax expense $ (22,315 ) $ (266,894 ) Income tax (expense) benefit — $ 109,031 Net income (loss) $ (22,315 ) $ (157,863 )
Cash flows from discontinued operations	Net cash provided by operating activities $ – Net cash provided by investing activities $ 66,200 Net cash used for financing activities $ –

7. INCOME TAXES (Tables)

7. INCOME TAXES (Tables)	12 Months Ended
	Dec. 31, 2017
Income Taxes Tables
Provision for income taxes	2017 2016 Current income tax expense: Federal $ – $ – State 10,859 10,238 Total current tax expense $ 10,859 $ 10,238 Deferred tax expense: Federal $ (123,124 ) $ (162,337 ) State (18,468 ) (23,867 ) Total deferred tax expense $ (141,592 ) $ (186,204 ) Total provision (benefit) for income tax expense $ (141,592 ) $ (175,966 )
Deferred tax assets	2017 2016 Deferred tax asset: Net operating loss carryforward 49,344 135,209 Intangibles – 32,111 Stock option compensation 152,895 211,523 Other assets – 74,517 Total deferred tax assets $ 202,239 $ 453,360 Deferred tax liabilities: Plant, property and equipment $ (14,308 ) $ (35,818 ) Total deferred tax liabilities $ (14,308 ) $ (35,818 ) Net deferred tax asset Net deferred tax asset – non-current $ 187,931 $ 417,542 Net deferred tax asset $ 187,931 $ 417,542
Expected income tax benefit reconciliation	2017 2016 Expected federal tax rate 21 % 35 % State income taxes 5 % (1 )% Effect of permanent differences 0 % 0 % Change in tax rate and other 0 % (5 )% Effective tax rate 26 % 29 %

8. STOCK WARRANTS, STOCK SPLI33

8. STOCK WARRANTS, STOCK SPLITS, AND STOCK OPTIONS (Tables)	12 Months Ended
	Dec. 31, 2017
PromissoryNoteNonCurrent
Option activity	Number of Options Weighted Average Exercise Price per Share Weighted Average Grant Date Fair Value Aggregate Intrinsic Value Outstanding on December 31, 2014 336 $ 8,692 $ 4,435 $ – Granted – – – – Exercised – – – – Canceled 129 – – – Outstanding on December 31, 2015 207 $ 8,692 $ 4,435 $ – Granted – – – – Exercised – – – – Canceled 39 – – – Outstanding on December 31, 2016 168 $ 5,000 $ 3,844 $ – Granted – – – – Exercised – – – – Cancelled – – – – Outstanding on December 31, 2017 168 $ 5,000 $ 3,844 $ –
Exercisable options	Range of Exercise Prices Number Outstanding Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price Number Exercisable Weighted Average Exercise Price $ 0 to $4,900 138 Perpetual $ 4,200 138 $ 4,200 $ 5,000 to $9,900 27 1 * $ 5,200 27 $ 5,200 $ 10,000 to $15,000 3 Perpetual $ 10,100 3 $ 10,100 $ 0 to $15,000 168 1 * $ 8,692 168 $ 8,692 * Excludes options with a perpetual life

14. OPERATING LEASES (Tables)

14. OPERATING LEASES (Tables)	12 Months Ended
	Dec. 31, 2017
Operating Leases Tables
Minimum rental payments on operating leases	Years ending December 31, 2018 $ 24,228 2019 4,128 2020 4,128 2021 4,128 2022 4,128 Total minimum future rental payments $ 40,740

17. EARNINGS PER SHARE (Tables)

17. EARNINGS PER SHARE (Tables)	12 Months Ended
	Dec. 31, 2017
PromissoryNoteNonCurrent
Basic Earning per share	For the Year Ended December 31, 2017 Income (Numerator) Shares (Denominator) Per Share Amount Income (Loss) from continuing operations $ (117,298 ) Less: preferred stock dividends – Income(Loss) available to common stockholders – Basic earnings per share (117,298 ) 1,241 $ (95 ) Effect of dilutive securities: Options and warrants – – Diluted earnings per share $ (117,298 ) 1,241 $ (95 ) For the Year Ended December 31, 2016 Income (Numerator) Shares (Denominator) Per Share Amount Income (Loss) from continuing operations $ (259,898 ) Less: preferred stock dividends – Income (Loss) available to common stockholders – Basic earnings per share (259,898 ) 1,241 $ (209 ) Effect of dilutive securities: Options and warrants – – – Income (Loss) available to common stockholders – Diluted earnings per share $ (259,898 ) 1,241 $ (209 )

21. OPERATING SEGMENTS (Tables)

21. OPERATING SEGMENTS (Tables)	12 Months Ended
	Dec. 31, 2017
Segment Reporting [Abstract]
Schedule segment	As of, and for the year ended, December 31, 2017: Holding Company Broker-Dealer Services Total Revenues from external customers $ – $ 15,569,191 $ 15,569,191 Interest expense (29,039 ) – (29,039 ) Depreciation 21,357 41,349 62,705 Income (loss) before income tax benefit (expense) (336,728 ) 305,363 (31,365 ) Income tax benefit (expense) 16,409 (102,342 ) (85,933 ) Net income (loss) of continued operations (320,319 ) 203,021 (117,298 ) Segment assets of continued operations 1,638,344 3,496,915 5,135,259 As of, and for the year ended, December 31, 2016: Holding Company Broker-Dealer Services Total Revenues from external customers $ – $ 17,173,038 $ 17,173,038 Other fee income – 334,882 334,882 Other income (3,462 ) 54,031 50,569 Interest expense (2,814 ) – (2,814 ) Depreciation 3,238 44,558 47,796 Income (loss) before income tax benefit (expense) (587,553 ) 277,151 310,402 Income tax benefit (expense) 170,185 (108,643 ) 61,542 Net income (loss) of continued operations (428,406 ) 168,508 (259,898 ) Segment assets of continued operations 1,662,726 3,177,059 4,839,785
Reconciliation of Segment Information	2017 2016 Assets for the Holding Company segment $ 1,638,344 $ 1,662,726 Assets for the Broker-Dealer Services segment $ 3,496,915 $ 3,177,059 Elimination for the Holding Company segment receivables $ – $ (243,392 ) Elimination for the Broker-Dealer Services segment receivables $ – $ (5,000 ) Consolidated assets of continued operations $ 5,135,259 $ 4,591,393

1. NATURE OF OPERATIONS AND S37

1. NATURE OF OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Advertising and promotion costs	$ 0	$ 0
Weighted average number of shares outstanding, basic	1,241	1,241
Restricted cash accounts	$ 157,911	$ 258,185
Minimum [Member]
Property plant and equipment useful life	5 years
Maximum [Member]
Property plant and equipment useful life	7 years
Dain account
Clearing deposits	$ 35,000	35,000
Pershing account
Clearing deposits	100,000	100,000
NSCC
Clearing deposits	$ 40,279	$ 40,279

2. CASH AND CASH EQUIVALENTS (D

2. CASH AND CASH EQUIVALENTS (Details Narrative) - USD ($)	Dec. 31, 2017	Dec. 31, 2016
Checking and savings accounts	$ 1,461,706	$ 934,711
Severance escrow	157,911	258,185
Pershing account
Clearing deposits	100,000	100,000
Dain account
Clearing deposits	35,000	35,000
NSCC
Clearing deposits	$ 40,279	$ 40,279

3. PROPERTY AND EQUIPMENT (Deta

3. PROPERTY AND EQUIPMENT (Details) - USD ($)	Dec. 31, 2017	Dec. 31, 2016
Property And Equipment Details
Office furniture and equipment	$ 348,363	$ 543,601
Land	98,409	98,409
Building	1,096,946	875,682
Accumulated depreciation and amortization	(271,747)	(422,058)
Property and equipment of discontinued operations	0	72,616
Property Plant and Equipment, Net	$ 1,271,971	$ 1,168,250

3. PROPERTY AND EQUIPMENT (De40

3. PROPERTY AND EQUIPMENT (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
PromissoryNoteNonCurrent
Depreciation expense	$ 62,705	$ 47,796

5. DISCONTINUED OPERATIONS (Det

5. DISCONTINUED OPERATIONS (Details) - USD ($)	Dec. 31, 2017	Dec. 31, 2016
Current Assets
Total current assets	$ 0	$ 6,375
Property and Equipment
Net property and equipment	0	72,616
Current liabilities
Total current liabilities	0	7,434
Noncurrent liabilities
Total noncurrent liabilities	0	2,907
Capital Natural Resources
Current Assets
Accounts receivable	0	5,626
Prepaids	0	749
Total current assets	0	6,374
Property and Equipment
Oil and natural gas properties, Full Cost Method of Accounting	0	61,829
Less accumulated depletion	0	(29,354)
Equipment	0	4,690
Less accumulated depreciation	0	(816)
Other property holdings	0	36,267
Net property and equipment	0	72,616
Total Assets	0	78,990
Current liabilities
Accounts payable	0	7,434
Total current liabilities	0	7,434
Noncurrent liabilities
Asset retirement obligations	0	2,907
Total noncurrent liabilities	0	2,907
Stockholder’s Equity
Common stock	0	300,400
Accumulated deficit	0	(231,751)
Total stockholder’s equity	0	68,649
Total liabilities and stockholder’s equity	$ 0	$ 78,990

5. DISCONTINUED OPERATIONS (D42

5. DISCONTINUED OPERATIONS (Details 1) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Other income (expenses)
Net income (loss)	$ (22,315)	$ (157,863)
Capital Natural Resources
Operating Revenues
Oil lease income	0	64,785
Total operating revenue	0	64,785
Operating Expenses
Compensation and benefits	0	55,097
Impairment	0	190,094
Lease operating expense	0	73,256
General and administrative	22,315	9,088
Depletion	0	18,887
Depreciation	0	616
Total operating expenses	22,315	347,038
Operating loss	(22,315)	(282,253)
Other income (expenses)
Interest expense	0	(847)
Interest income	0	16,206
Total other income (expenses)	0	15,359
Income (Loss) of discontinued operations before income tax expense	(22,315)	(266,894)
Income tax (expense) benefit	0	109,031
Net income (loss)	$ (22,315)	$ (157,863)

5. DISCONTINUED OPERATIONS (D43

5. DISCONTINUED OPERATIONS (Details 2) - Capital Natural Resources	12 Months Ended
	Dec. 31, 2016USD ($)
Cash Flows used in Operating Activities	$ 0
Cash Flows used in Investing Activities	66,200
Cash Flows used in Financing Activities	$ 0

6. LINE OF CREDIT (Details Narr

6. LINE OF CREDIT (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Debt Disclosure [Abstract]
Line of credit	$ 0
Interest expense	$ 0	$ 0

7. INCOME TAXES (Details)

7. INCOME TAXES (Details) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Current income tax expense:
Federal	$ 0	$ 0
State	10,859	10,238
Total current tax expense	10,859	10,238
Deferred tax expense:
Federal	(123,124)	(162,337)
State	(18,468)	(23,867)
Total deferred tax expense	(141,592)	(186,204)
Total provision (benefit) for income tax expense	$ 85,933	$ (61,542)

7. INCOME TAXES (Details 1)

7. INCOME TAXES (Details 1) - USD ($)	Dec. 31, 2017	Dec. 31, 2016
Deferred tax asset:
Net operating carry forwards	$ 49,344	$ 135,209
Intangibles	0	32,111
Stock option compensation	152,895	211,523
Other assets	0	74,517
Total deferred tax assets	202,239	453,360
Deferred tax liabilities:
Plant, property and equipment	(14,308)	(35,818)
Total deferred tax liabilities	(14,308)	(35,818)
Net deferred tax asset - non - current	187,931	417,542
Net deferred tax asset	$ 187,931	$ 417,542

7. INCOME TAXES (Details 2)

7. INCOME TAXES (Details 2)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Reconciliation of the Difference Between the Expected Income Tax Benefit (Expense) Rate:
Expected federal tax rate	21.00%	35.00%
State income taxes	5.00%	(1.00%)
Effect of permanent differences	0.00%	0.00%
Change in tax rate and other	0.00%	(5.00%)
Effective tax rate	26.00%	29.00%

7. INCOME TAXES (Details Narrat

7. INCOME TAXES (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Income Taxes Details Narrative
Federal net operation loss carryforward	$ 759,802
Federal net operation loss carryforward expiration	Dec. 31, 2036
Income tax payable	$ 10,859	$ 10,187

8. STOCK WARRANTS, STOCK SPLI49

8. STOCK WARRANTS, STOCK SPLITS, AND STOCK OPTIONS (Details) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Stock Warrants Stock Splits And Stock Options Details
Number of options, Outstanding Beginning	168	207	336
Number of options, Granted	0	0	0
Number of options, Exercised	0	0	0
Number of options, Canceled	0	39	129
Number of options, Outstanding Ending	168	168	207
Weighted Average Exercise Price per Share, Beginning	$ 5,000	$ 8,692	$ 8,692
Weighted Average Exercise Price per Share, Granted	0	0	0
Weighted Average Exercise Price per Share, Exercised	0	0	0
Weighted Average Exercise Price per Share, Canceled	0	0	0
Weighted Average Exercise Price per Share, Ending	5,000	5,000	8,692
Weighted Average Grant Date Fair Value, Beginning	3,844	4,435	4,435
Weighted Average Grant Date Fair Value, Granted	0	0	0
Weighted Average Grant Date Fair Value, Exercised	0	0	0
Weighted Average Grant Date Fair Value, Canceled	0	0	0
Weighted Average Grant Date Fair Value, Ending	$ 3,844	$ 3,844	$ 4,435
Aggregate Intrinsic Value, Beginning	$ 0	$ 0	$ 0
Aggregate Intrinsic Value, Granted	0	0	0
Aggregate Intrinsic Value, Exercised	0	0	0
Aggregate Intrinsic Value, Canceled	0	0	0
Aggregate Intrinsic Value, Ending	$ 0	$ 0	$ 0

8. STOCK WARRANTS, STOCK SPLI50

8. STOCK WARRANTS, STOCK SPLITS, AND STOCK OPTIONS (Details 1)	12 Months Ended
	Dec. 31, 2017$ / sharesshares
0 to $4,900
Number Outstanding | shares	138
Weighted Average Remaining Contractual Life (Years)	Perpetual
Weighted Average Exercise Price | $ / shares	$ 4,200
Number Exercisable | shares	138
Weighted Average Exercise Price | $ / shares	$ 4,200
5,000 to $9,900
Number Outstanding | shares	27
Weighted Average Remaining Contractual Life (Years)	1 year	[1]
Weighted Average Exercise Price | $ / shares	$ 5,200
Number Exercisable | shares	27
Weighted Average Exercise Price | $ / shares	$ 5,200
10,000 to $15,000
Number Outstanding | shares	3
Weighted Average Remaining Contractual Life (Years)	Perpetual
Weighted Average Exercise Price | $ / shares	$ 10,100
Number Exercisable | shares	3
Weighted Average Exercise Price | $ / shares	$ 10,100
0 to $15,000
Number Outstanding | shares	168
Weighted Average Remaining Contractual Life (Years)	1 year	[1]
Weighted Average Exercise Price | $ / shares	$ 8,692
Number Exercisable | shares	168
Weighted Average Exercise Price | $ / shares	$ 8,692
[1]	Excludes options with a perpetual life.

8. STOCK WARRANTS, STOCK SPLI51

8. STOCK WARRANTS, STOCK SPLITS, AND STOCK OPTIONS (Details Narrative) - USD ($)	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
PromissoryNoteNonCurrent
Stock options canceled amount	$ 1,103,600
Stock options canceled	421
Exercisable options	168	168	207

9. EMPLOYEE BENEFIT PLANS (Deta

9. EMPLOYEE BENEFIT PLANS (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Retirement Benefits [Abstract]
Employee benefit plan expenses	$ 2,858	$ 2,701
Matching contributions paid by the company	$ 54,826	$ 52,608

11. NET CAPITAL REQUIREMENTS (D

11. NET CAPITAL REQUIREMENTS (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Mortgage Banking [Abstract]
Net capital	$ 626,186	$ 400,209
Minimum net capital requirement	171,851	143,787
Excess net capital	$ 454,335	$ 171,851
Ratio of aggregate indebtedness to net capital	4.10%	5.40%

14. OPERATING LEASES (Details)

14. OPERATING LEASES (Details)	Dec. 31, 2017USD ($)
Years ending December 31,
2,018	$ 24,228
2,019	4,128
2,020	4,128
2,021	4,128
2,022	4,128
Total minimum future rental payments	$ 40,740

14. OPERATING LEASES (Details N

14. OPERATING LEASES (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Leases [Abstract]
Rent expense for leases	$ 94,224	$ 94,224

15. GOODWILL (Details Narrative

15. GOODWILL (Details Narrative) - USD ($)	Dec. 31, 2017	Dec. 31, 2016
Goodwill Details Narrative
Goodwill	$ 0	$ 0

17. EARNINGS PER SHARE (Details

17. EARNINGS PER SHARE (Details) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Earnings Per Share Details Usd Abstract
Income (Loss) from continuing operations	$ (117,298)	$ (259,898)
Less: Preferred Stock Dividends	0	0
Income (Loss) available to common stockholders Basic earnings per share, Amount	$ (117,298)	$ (259,898)
Income (Loss) available to common stockholders Basic earnings per share, Shares	1,241	1,241
Income (Loss) available to common stockholders Basic earnings per share	$ (95)	$ (209)
Effect of Dilutive Securities:
Options and Warrants	$ 0	$ 0
Income Available to Common Shareholders - Diluted Earnings per Share, Amount	$ (117,298)	$ (259,898)
Income Available to Common Shareholders - Diluted Earnings per Share, Shares	1,241	1,241
Income Available to Common Shareholders - Diluted Earnings per Share	$ (95)	$ (209)

17. EARNINGS PER SHARE (Detai58

17. EARNINGS PER SHARE (Details Narrative)	Dec. 31, 2017$ / sharesshares
Options and warrants to purchase | shares	378
Minimum [Member]
Options and warrants to purchase, exercise prices	$ 3,500
Maximum [Member]
Options and warrants to purchase, exercise prices	$ 14,300

21. OPERATING SEGMENTS (Details

21. OPERATING SEGMENTS (Details) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Other fee income	$ 313,462	$ 335,122
Other income	156,932	50,329
Interest expense	(29,039)	(2,814)
Depreciation	62,705	47,796
Income (loss) before income tax benefit (expense)	(31,365)	(321,440)
Income tax benefit (expense)	(85,933)	61,542
Net income (loss) of continued operations	(139,613)	(417,761)
Holding Company [Member]
Revenues from external customers	0	0
Other fee income		0
Other income		(3,462)
Interest expense	(29,039)	(2,814)
Depreciation	21,357	3,238
Income (loss) before income tax benefit (expense)	(336,728)	(587,553)
Income tax benefit (expense)	16,409	170,185
Net income (loss) of continued operations	(320,319)	(428,406)
Segment assets of continued operations	1,638,344	1,662,726
Broker-Dealer Services [Member]
Revenues from external customers	15,569,191	17,173,038
Other fee income		334,882
Other income		54,031
Interest expense	0	0
Depreciation	41,349	44,558
Income (loss) before income tax benefit (expense)	305,363	277,151
Income tax benefit (expense)	(102,342)	(108,643)
Net income (loss) of continued operations	203,021	168,508
Segment assets of continued operations	3,496,915	3,177,059
Total [Member]
Revenues from external customers	15,569,191	17,173,038
Other fee income		334,882
Other income		50,569
Interest expense	(29,039)	(2,814)
Depreciation	62,705	47,796
Income (loss) before income tax benefit (expense)	(31,365)	310,402
Income tax benefit (expense)	(85,933)	61,542
Net income (loss) of continued operations	(117,298)	(259,898)
Segment assets of continued operations	$ 5,135,259	$ 4,839,785

21. OPERATING SEGMENTS (Detai60

21. OPERATING SEGMENTS (Details 1) - USD ($)	Dec. 31, 2017	Dec. 31, 2016
Assets	$ 5,135,259	$ 4,954,985
Holding Company segment [Member]
Assets	1,638,344	1,662,726
Receivables	0	(243,392)
Broker Dealer Services, Inc. [Member]
Assets	3,496,915	3,177,059
Receivables	$ 0	$ (5,000)