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Segment Information
 9 Months Ended
Sep. 30, 2012
Segment Information  
Segment Information

15.   Segment Information

        Management has assessed and determined that the Company operates in three business segments representing the Company's three principal distribution channels: Mutual Fund, Institutional and High Net Worth, each of which has different client relationships.

        Revenue in the Mutual Fund distribution channel is earned from advisory and sub-advisory relationships with all domestically-registered investment products as well as non-institutional investment products that are registered abroad. Revenue in the Institutional distribution channel is earned from relationships with public and private client entities, including pension plans, foundations, endowments and sovereign wealth funds. Revenue in the High Net Worth distribution channel is earned from relationships with wealthy individuals, family trusts and managed account programs.

        Revenue earned from client relationships managed by Affiliates accounted for under the equity method is not consolidated with the Company's reported Revenue but instead is included (net of operating expenses, including amortization) in Income from equity method investments, and reported in the distribution channel in which the Affiliate operates. Income tax attributable to the profits of the Company's equity method Affiliates is reported within the Company's consolidated income tax provision.

        In firms with revenue sharing arrangements, a certain percentage of revenue is allocated for use by management of an Affiliate in paying operating expenses of that Affiliate, including salaries and bonuses, and is called an "Operating Allocation." In reporting segment operating expenses, Affiliate expenses are allocated to a particular segment on a pro rata basis with respect to the revenue generated by that Affiliate in such segment. Generally, as revenue increases, additional compensation is typically paid to Affiliate management partners from the Operating Allocation. As a result, the contractual expense allocation pursuant to a revenue sharing arrangement may result in the characterization of any growth in profit margin beyond the Company's Owners' Allocation as an operating expense. All other operating expenses (excluding intangible amortization) and interest expense have been allocated to segments based on the proportion of cash flow distributions reported by Affiliates in each segment.

Statements of Income

 
   For the Three Months Ended September 30, 2011  
 
   Mutual Fund   Institutional   High Net Worth   Total  

Revenue

   $ 179.0   $ 199.6   $ 35.2   $ 413.8  

Operating expenses:

                          

Depreciation, intangible amortization and impairments

     4.2     19.8     2.1     26.1  

Other operating expenses

     119.3     120.9     21.5     261.7  
                   

 

     123.5     140.7     23.6     287.8  
                   

Operating income

     55.5     58.9     11.6     126.0  
                   

Non-operating (income) and expenses:

                          

Investment and other loss

     5.5     2.6     1.4     9.5  

Income from equity method investments          

     (2.0 )   (6.6 )   (1.2 )   (9.8 )

Interest expense

     6.1     10.3     1.7     18.1  

Imputed interest and contingent payment arrangements

     4.7     3.1     0.5     8.3  
                   

 

     14.3     9.4     2.4     26.1  
                   

Income before income taxes

     41.2     49.5     9.2     99.9  

Income taxes

     8.1     9.5     2.2     19.8  
                   

Net income

     33.1     40.0     7.0     80.1  

Net income (non-controlling interests)

     (14.7 )   (22.3 )   (3.0 )   (40.0 )
                   

Net income (controlling interest)

   $ 18.4   $ 17.7   $ 4.0   $ 40.1  
                   

 

 
   For the Three Months Ended September 30, 2012  
 
   Mutual Fund   Institutional   High Net Worth   Total  

Revenue

   $ 208.3   $ 210.7   $ 48.3   $ 467.3  

Operating expenses:

                          

Depreciation, intangible amortization and impairments

     5.4     19.0     3.1     27.5  

Other operating expenses

     139.1     131.5     29.5     300.1  
                   

 

     144.5     150.5     32.6     327.6  
                   

Operating income

     63.8     60.2     15.7     139.7  
                   

Non-operating (income) and expenses:

                          

Investment and other income

     (3.2 )   (2.8 )   (0.9 )   (6.9 )

Income from equity method investments          

     (3.2 )   (14.8 )   (1.4 )   (19.4 )

Interest expense

     7.5     12.0     2.3     21.8  

Imputed interest and contingent payment arrangements

     3.2     3.0     0.5     6.7  
                   

 

     4.3     (2.6 )   0.5     2.2  
                   

Income before income taxes

     59.5     62.8     15.2     137.5  

Income taxes

     7.5     9.4     2.5     19.4  
                   

Net income

     52.0     53.4     12.7     118.1  

Net income (non-controlling interests)

     (27.3 )   (28.5 )   (7.4 )   (63.2 )
                   

Net income (controlling interest)

   $ 24.7   $ 24.9   $ 5.3   $ 54.9  
                   

 

 
   For the Nine Months Ended September 30, 2011  
 
   Mutual Fund   Institutional   High Net Worth   Total  

Revenue

   $ 555.7   $ 640.6   $ 106.1   $ 1,302.4  

Operating expenses:

                          

Depreciation, intangible amortization and impairments

     12.3     59.3     6.3     77.9  

Other operating expenses

     375.7     392.0     65.9     833.6  
                   

 

     388.0     451.3     72.2     911.5  
                   

Operating income

     167.7     189.3     33.9     390.9  
                   

Non-operating (income) and expenses:

                          

Investment and other (income) loss

     2.0     (6.9 )   11.7     6.8  

Income from equity method investments

     (2.5 )   (34.2 )   (3.4 )   (40.1 )

Interest expense

     18.0     32.5     5.1     55.6  

Imputed interest and contingent payment arrangements

     13.6     9.8     1.5     24.9  
                   

 

     31.1     1.2     14.9     47.2  
                   

Income before income taxes

     136.6     188.1     19.0     343.7  

Income taxes

     30.8     39.8     2.6     73.2  
                   

Net income

     105.8     148.3     16.4     270.5  

Net income (non-controlling interests)

     (52.0 )   (82.0 )   (11.9 )   (145.9 )
                   

Net income (controlling interest)

   $ 53.8   $ 66.3   $ 4.5   $ 124.6  
                   

 

 
   For the Nine Months Ended September 30, 2012  
 
   Mutual Fund   Institutional   High Net Worth   Total  

Revenue

   $ 557.4   $ 636.8   $ 120.3   $ 1,314.5  

Operating expenses:

                          

Depreciation, intangible amortization and impairments

     115.1     57.8     6.8     179.7  

Other operating expenses

     385.2     400.9     75.2     861.3  
                   

 

     500.3     458.7     82.0     1,041.0  
                   

Operating income

     57.1     178.1     38.3     273.5  
                   

Non-operating (income) and expenses:

                          

Investment and other income

     (7.5 )   (10.9 )   (1.9 )   (20.3 )

Income from equity method investments

     (8.5 )   (34.6 )   (4.2 )   (47.3 )

Interest expense

     19.5     33.7     5.6     58.8  

Imputed interest and contingent payment arrangements

     (24.7 )   (12.1 )   1.1     (35.7 )
                   

 

     (21.2 )   (23.9 )   0.6     (44.5 )
                   

Income before income taxes

     78.3     202.0     37.7     318.0  

Income taxes

     —     39.2     6.8     46.0  
                   

Net income

     78.3     162.8     30.9     272.0  

Net income (non-controlling interests)

     (70.0 )   (85.8 )   (17.3 )   (173.1 )
                   

Net Income (controlling interest)

   $ 8.3   $ 77.0   $ 13.6   $ 98.9  
                   

Balance Sheet Information

                          

Total assets as of December 31, 2011

   $ 1,920.6   $ 2,836.2   $ 462.1   $ 5,218.9  

Total assets as of September 30, 2012

   $ 2,367.5   $ 3,029.5   $ 633.8   $ 6,030.8