XML 21 R11.htm IDEA: XBRL DOCUMENT
v3.20.1

Investments | 12 Months Ended
--- | ---
Mar. 31, 2020
Equity Method Investments and Joint Ventures [Abstract] |
Investments | Investments Investments consist of the following:
| March 31, |  |
| 2020 |  | 2019
Equity method investments in Partnerships | $ | 166,106 |  |  | $ | 122,505 |
Equity method investments in Partnerships held by consolidated VIEs (See Note 5) | 9,988 |  |  | 11,648 |
Other equity method investments | 1,168 |  |  | 1,086 |
Other investments | 13,394 |  |  | 12,488 |
Investments valued under the measurement alternative | 17,091 |  |  | 6,764 |
Total Investments | $ | 207,747 |  |  | $ | 154,491 |
Equity method investments The Company’s equity method investments in Partnerships represent its ownership in certain specialized funds and customized separate accounts. The strategies and geographic location of investments within the Partnerships vary by fund. The Company has a 1% interest in substantially all of the Partnerships. The Company’s other equity method investments represent its ownership in a technology company that provides benchmarking and analytics of private equity data and its ownership in a joint venture that automates the collection of fund and underlying portfolio company data from general partners. The Company recognized equity method income related to its investments in Partnerships and other equity method investments of $20,250, $7,202, and $17,102 for the years ended March 31, 2020, 2019, and 2018, respectively. The Company’s equity method investments in Partnerships consist of the following types:
| March 31, |  |
| 2020 |  | 2019
Primary funds | $ | 37,317 |  |  | $ | 22,791 |
Secondary funds | 19,872 |  |  | 15,762 |
Direct/co-investment funds | 50,288 |  |  | 35,902 |
Customized separate accounts | 58,629 |  |  | 48,050 |
Total equity method investments in Partnerships | $ | 166,106 |  |  | $ | 122,505 |
The Company’s equity method investments in Partnerships held by consolidated VIEs consist of direct/co-investment funds. The Company evaluates each of its equity method investments to determine if any were significant pursuant to the requirements of Regulation S-X. As of and for the years ended March 31, 2020 and 2019, no individual equity method investment held by the Company met the significance criteria, and, as a result, the Company is not required to present separate financial statements for any of its equity method investments. The summarized financial information of the Company’s equity method investments in Partnerships is as follows:
| March 31, |  |  |  |
| 2020 |  | 2019 |  |
Assets |  |  |  |  |
Investments | $ | 17,577,766 |  |  | $ | 13,473,255 |  |  |
Other assets | 415,221 |  |  | 349,425 |  |  |
Total assets | $ | 17,992,987 |  |  | $ | 13,822,680 |  |  |
Liabilities and Partners’ Capital |  |  |  |  |
Debt | $ | 61,114 |  |  | $ | 84,530 |  |  |
Other liabilities | 107,600 |  |  | 57,772 |  |  |
Total liabilities | 168,714 |  |  | 142,302 |  |  |
Partners’ capital | 17,824,273 |  |  | 13,680,378 |  |  |
Total liabilities and partners’ capital | $ | 17,992,987 |  |  | $ | 13,822,680 |  |  |
| Year Ended March 31, |  |  |  |
| 2020 |  | 2019 |  | 2018
Investment income | $ | 300,121 |  |  | $ | 211,797 |  |  | $ | 233,255 |
Expenses | 185,769 |  |  | 149,598 |  |  | 130,771 |
Net investment income (loss) | 114,352 |  |  | 62,199 |  |  | 102,484 |
Net realized and unrealized gain | 1,830,599 |  |  | 618,047 |  |  | 1,647,977 |
Net income | $ | 1,944,951 |  |  | $ | 680,246 |  |  | $ | 1,750,461 |
Other investments The Company’s other investments represent investments in private equity funds and direct credit and equity co-investments. The private equity fund investments can only be redeemed through distributions received from the liquidation of underlying investments of the fund, and the timing of distributions is currently indeterminable. The direct credit co-investments are debt securities classified as trading securities. The Company’s other investments are measured at fair value with unrealized holding gains and losses included in earnings. The Company’s other investments are recorded at estimated fair value utilizing significant unobservable inputs and are, therefore, classified in Level 3 of the fair value hierarchy. The following is a reconciliation of other investments for which significant unobservable inputs (Level 3) were used in determining value:
| Private equity funds |  | Direct credit co-investments |  | Direct equity co-investments |  | Total other investments
Balance as of March 31, 2018 | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Contributions | 3,105 |  |  | 3,864 |  |  | 4,814 |  |  | 11,783 |
Distributions | — |  |  | — |  |  | — |  |  | — |
Net gain | 629 |  |  | 76 |  |  | — |  |  | 705 |
Balance as of March 31, 2019 | $ | 3,734 |  |  | $ | 3,940 |  |  | $ | 4,814 |  |  | $ | 12,488 |
Contributions | 2,526 |  |  | — |  |  | 1,875 |  |  | 4,401 |
Distributions | (777) |  |  | (1,970) |  |  | — |  |  | (2,747) |
Net gain (loss) | 303 |  |  | (214) |  |  | (837) |  |  | (748) |
Balance as of March 31, 2020 | $ | 5,786 |  |  | $ | 1,756 |  |  | $ | 5,852 |  |  | $ | 13,394 |
The valuation methodologies, significant unobservable inputs, range of inputs and the weighted average input determined based upon relative fair value of the investments used in recurring Level 3 fair value measurements of assets were as follows, as of March 31, 2020:
|  |  |  |  | Significant |  |  |  |  |  |
| Fair |  | Valuation |  | Unobservable |  |  |  |  |  | Weighted
| Value |  | Methodology |  | Inputs |  | Range |  |  |  | Average
Private equity funds | $ | 5,786 |  |  | Adjusted net asset value |  |  | Selected market return |  |  | (7.4)% | - | (3)% |  | (6.2)%
Direct credit co-investments | $ | 1,756 |  |  | Discounted cash flow |  |  | Market yield |  |  | 11.5% | - | 12.6% |  | 12.5%
Direct equity co-investments | $ | 5,852 |  |  | Market approach |  |  | EBITDA multiple |  | 7.25x | - | 12x |  | 9.93x
|  |  | Market approach |  |  | Equity multiple |  | 1.05x |  |  |  | 1.05x
As of March 31, 2019, private equity funds were recorded at estimated fair value based upon the net asset value of the Company’s ownership interest in the underlying fund utilizing the practical expedient under ASC 820, “Fair Value Measurement.” The direct credit and equity co-investments were recorded at recent precedent transactions. For the significant unobservable inputs listed in the table above, (1) a significant increase or decrease in the selected market return would result in a significantly higher or lower fair value measurement, respectively; (2) a significant increase or decrease in the market yield would result in a significantly lower or higher fair value measurement, respectively; and (3) a significant increase or decrease in the selected multiple would result in a significantly higher or lower fair value measurement, respectively. During the year ended March 31, 2020, the Company transferred these investments for an agreed amount of cash of $15,750 to a Partnership that is a VIE of which the Company is the general partner but does not consolidate as the Company is not the primary beneficiary. Due to continuing involvement with these assets at the Partnership, the Company accounted for this transfer as a secured financing as it has not met the criteria in ASC 860, “Transfers and Servicing”, to qualify as a sale and, therefore, has recorded a financial liability for the secured financing which is included in other liabilities in the Consolidated Balance Sheets. The cash received was recorded as secured financing in financing activities in the Consolidated Statements of Cash Flows. As of March 31, 2020, all other investments were pledged as collateral on the Company’s secured financing. The Company accounts for this financial liability at fair value under the fair value option. The primary reason for electing the fair value option is to mitigate volatility in earnings from using different measurement attributes. The significant input to the fair value of the secured financing is the fair value of the other investments delivered as collateral. As of March 31, 2020, the secured financing had a fair value of $13,394 and an amortized cost of $12,894. The fair value of the secured financing is estimated using Level 3 inputs with the significant input being the fair value of the other investments utilized as collateral as shown above. The Company recognized a loss of $748 and a gain of $705 on other investments during the years ended March 31, 2020 and 2019, respectively. The Company recognized a gain of $43 on the secured financing liability during the year ended March 31, 2020. Gains and losses related to other investments and the secured financing liability are recorded in non-operating income in the Consolidated Statements of Income. Investments valued under the measurement alternative The Company’s investments valued under the measurement alternative include equity securities in other proprietary investments for which the Company does not have significant influence and fair value is not readily determinable. ASU 2016-01 requires equity securities to be recorded at cost and adjusted to fair value at each reporting period. However, the guidance allows for a measurement alternative, which is to record the investments at cost, less impairment, if any, and subsequently adjust for observable price changes of identical or similar investments of the same issuer. During the year ended March 31, 2020, the Company made equity investments in two private companies. The Company invested approximately $2,000 in a technology company that has developed software to automate manual data entry tasks associated with alternative investment reporting. The Company invested approximately $10,000 in a technology company which has developed a platform for investing in alternative assets. Due to the lack of readily determinable fair values for these investments, for which the Company does not have significant influence, the Company will hold both of these investments under the measurement alternative at cost less impairment. On January 31, 2020, an observable price transaction occurred for one of the Company’s investments valued under the measurement alternative. The Company recorded a fair value adjustment of $1,507, which is recorded in non-operating income in the Consolidated Statements of Income for the year ended March 31, 2020. On July 1, 2019, an acquisition of an entity in which the Company held an investment with a carrying value of $1,446 was completed. The Company received cash proceeds of $6,419 and recorded a gain of approximately $4,973 in connection with the transaction, which was recorded in non-operating income in the Consolidated Statements of Income for the year ended March 31, 2020. The Company performs qualitative impairment assessments on its investments recorded under the measurement alternative. As of March 31, 2019, the Company determined that a quantitative assessment was required to be performed for one of its technology investments. The assessment indicated that the fair value was less than the carrying value at March 31, 2019. Prior to the impairment recorded, the carrying value of the investment was $2,990. The impairment amount was $701 and is included in non-operating income. The fair value was determined using both a discounted cash flow approach and a market approach based on guideline public companies, and is a Level 3 fair value measurement as financial projections were utilized. On August 2, 2018, an acquisition of an entity in which the Company held an investment with a carrying amount of $10,798 was completed. The Company received cash proceeds of $17,724 and recorded a gain of $6,926 in connection with the transaction, which was recorded in non-operating income for the year ended March 31, 2019. On August 11, 2018, an acquisition of an entity in which the Company held an investment with a carrying amount of $600 was completed. The Company received cash proceeds of $4,807 and recorded a gain of $4,207 in connection with the transaction, which was recorded in non-operating income for the year ended March 31, 2019.

X
- Definition The entire disclosure for cost method and equity method investments included basis, impairment losses, recognized or unrecognized gains (losses). + References No definition available. + Details
Name: | us-gaap_CostAndEquityMethodInvestmentsDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- References No definition available. + Details
Name: | us-gaap_EquityMethodInvestmentsAndJointVenturesAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration