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Note 10 - Fair Value Measurements
 12 Months Ended
Dec. 31, 2024
Notes to Financial Statements  
Fair Value Disclosures [Text Block]

Note 10 — Fair Value Measurements

 

The following table presents assets and liabilities in our consolidated financial statements or disclosed in the notes to our consolidated financial statements at fair value on a recurring basis as of December 31, 2024 (in millions):

 

​

 

Fair value measurements using:

  

​

     

​

 

Quoted prices

  

​

  

​

  

​

     

​

 

in active

  

Significant

  

​

  

​

     
  

markets for

  

other

  

Significant

  

Investments

     

​

 

identical assets

  

observable

  

unobservable

  

valued at

     

​

 

and liabilities

  

inputs

  

inputs

  

practical

     

​

 

(Level 1)

  

(Level 2)

  

(Level 3)

  

expedient(1)

  

Total

 

Assets:

 

​

  

​

  

​

      

​

 

Cash equivalents

 $821.7  $—  $—  $—  $821.7 

Current investments:

 

​

  

​

  

​

      

​

 

Consolidated VIEs

  260.6   241.5   —   —   502.1 

Other investments

  273.8   33.7   2.0   27.6   337.1 

Total current investments

  534.4   275.2   2.0   27.6   839.2 

Other

  —   10.2   2.5   —   12.7 

Total assets

 $1,356.1  $285.4  $4.5  $27.6  $1,673.6 

Liabilities:

 

​

  

​

  

​

      

​

 

Long-term debt(2)

 $—  $383.3  $—  $—  $383.3 

Deferred bonuses

  —   —   115.7   —   115.7 

Contingent consideration

  —   —   30.4   —   30.4 

Other

  1.9   11.7   —   —   13.6 

Total liabilities

 $1.9  $395.0  $146.1  $—  $543.0 

 

(1)Certain seeded investment products that do not have a readily determinable fair value have been measured at fair value using the NAV as a practical expedient and have not been categorized in the fair value hierarchy.

(2)

Carried at amortized cost in our Consolidated Balance Sheets and disclosed in this table at fair value.

 

The following table presents assets and liabilities in our consolidated financial statements or disclosed in the notes to the consolidated financial statements at fair value on a recurring basis as of December 31, 2023 (in millions):

 

​

 

Fair value measurements using:

  

​

 

​

 

Quoted prices

  

​

  

​

  

​

 

​

 

in active

  

Significant

  

​

  

​

 
  markets for  other  Significant     

​

 

identical assets

  

observable

  

unobservable

  

​

 

​

 

and liabilities

  

inputs

  

inputs

  

​

 

​

 

(Level 1)

  

(Level 2)

  

(Level 3)

  

Total

 

Assets:

 

​

  

​

  

​

  

​

 

Cash equivalents

 $894.4  $—  $—  $894.4 

Current investments:

 

​

  

​

  

​

  

​

 

Consolidated VIEs

  317.6   64.7   0.1   382.4 

Other investments

  212.2   122.0   —   334.2 

Total current investments

  529.8   186.7   0.1   716.6 

Other

  —   8.5   1.0   9.5 

Total assets

 $1,424.2  $195.2  $1.1  $1,620.5 

Liabilities:

 

​

  

​

  

​

  

​

 

Long-term debt(1)

 $—  $298.0  $—  $298.0 

Deferred bonuses

  —   —   117.6   117.6 

Other

  1.7   18.6   —   20.3 

Total liabilities

 $1.7  $316.6  $117.6  $435.9 

 

(1)

Carried at amortized cost in our Consolidated Balance Sheets and disclosed in this table at fair value.

 ​

Level 1 Fair Value Measurements

 

Our Level 1 fair value measurements consist mostly of investments held by consolidated and unconsolidated seeded investment products and cash equivalents with quoted market prices in active markets. The fair value level of consolidated investments held by seeded investment products is determined by the underlying securities of the product. The fair value level of unconsolidated investments held in seeded investment products is determined by the NAV, which is considered a quoted price in an active market.

 

Level 2 Fair Value Measurements

 

Our Level 2 fair value measurements consist mostly of investments held by consolidated investment products and our long-term debt. The fair value level of consolidated investments held by seeded investment products is determined by the underlying securities of the product. The fair value level of our long-term debt is determined using recent trading activity, which is considered a Level 2 input.

 

Level 3 Fair Value Measurements

 

Investments

 

As of December 31, 2024 and 2023, certain investments within consolidated VIEs and VREs were valued using significant unobservable inputs, resulting in Level 3 classification.

 

Deferred Bonuses

 

Deferred bonuses represent liabilities to employees over the vesting period that will be settled by investments in our products or cash. Upon vesting, employees receive the value of the investment product selected by the participant, adjusted for gains or losses attributable to the product. The significant unobservable inputs used to value the liabilities are investment designations and vesting periods.

 

Changes in Fair Value

 

Changes in fair value of our Level 3 assets for the years ended December 31, 2024 and 2023, were as follows (in millions):

 

​

 

Year ended December 31,

 

​

 

2024

  

2023

 

Beginning of period fair value

 $1.1  $18.3 

Settlement of contingent consideration

  —   (0.2)

Fair value adjustments

  1.4   (12.1)

Transfers from (to) Level 1, net

  —   (4.6)

Purchases (sales) of securities, net

  2.0   (0.3)

End of period fair value

 $4.5  $1.1 

 

Changes in fair value of our Level 3 liabilities for the years ended December 31, 2024 and 2023, were as follows (in millions):

 ​

​

 

Year ended December 31,

 

​

 

2024

  

2023

 

Beginning of period fair value

 $117.6  $46.5 

Fair value adjustments

  13.1   9.0 

Settlement of contingent consideration

  (0.3)  — 

Vesting of deferred bonuses

  (85.7)  (34.7)

Amortization of deferred bonuses

  70.8   58.6 

Foreign currency translation

  0.4   2.4 

Additions

  30.2   35.8 

End of period fair value

 $146.1  $117.6 

 

Nonrecurring Fair Value Measurements

 ​

Nonrecurring Level 3 fair value measurements include goodwill and intangible assets and contingent consideration liabilities. We measure the fair value of goodwill and intangible assets on initial recognition based on the present value of estimated future cash flows. Significant assumptions used to determine estimated fair value include AUM, investment management fee rates, discount rates, and expenses. Refer to Note 8 — Goodwill and Intangible Assets, in Part II, Item 8, Financial Statements and Supplementary Data, for additional information on the impairment assessments. We measure the fair value of the contingent consideration liabilities on initial recognition using the Monte Carlo method that requires assumptions regarding projected future earnings and discount rate. Because of the significance of the unobservable inputs in the fair value measurements of these assets and liabilities, such measurements are classified as Level 3.

 

Investments Valued at Practical Expedient

 

As a practical expedient to value certain investments that do not have a readily determinable fair value and have attributes of an investment, we use the NAV as the fair value. As such, investments in private investment funds with a fair value of $27.6 million are excluded from the fair value hierarchy as of December 31, 2024. Further, the respective fund’s investment portfolio may contain debt investments that are in the form of revolving lines of credit and unfunded delayed draw commitments, which require the fund to provide funding when requested by portfolio companies in accordance with the terms of the underlying loan agreements. As of December 31, 2024, the investments valued at the practical expedient had $12.7 million of associated unfunded commitments. 

 ​ ​