Fair Value Measurements

The following tables summarize the Company’s financial assets and liabilities that are measured at fair value on a recurring basis:



			Fair Value Measurements
	December 31, 2015		Fair Value Measurements
	December 31, 2015		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Other Unobservable Inputs (Level 3)
Financial Assets
Cash equivalents	$	65.9	$	65.9	$	—	$	—
Investments in marketable securities⁽¹⁾
Trading securities	19.4		19.4		—		—
Available-for-sale securities	180.5		180.5		—		—
Other investments⁽²⁾	23.3		20.7		2.6		—
Financial Liabilities
Contingent payment arrangements⁽³⁾	$	10.2	$	—	$	—	$	10.2
Affiliate equity obligations⁽³⁾⁽⁴⁾	62.3		—		—		62.3



			Fair Value Measurements
	March 31, 2016		Fair Value Measurements
	March 31, 2016		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Other Unobservable Inputs (Level 3)
Financial Assets
Cash equivalents	$	28.3	$	28.3	$	—	$	—
Investments in marketable securities⁽¹⁾
Trading securities	56.5		56.5		—		—
Available-for-sale securities	151.7		151.7		—		—
Other investments⁽²⁾	6.9		4.3		2.6		—
Financial Liabilities
Contingent payment arrangements⁽³⁾	$	7.8	$	—	$	—	$	7.8
Affiliate equity obligations⁽³⁾⁽⁴⁾	35.6		—		—		35.6
Foreign currency forward contracts⁽⁵⁾	1.2		—		1.2		—

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⁽¹⁾	Principally investments in equity securities.


⁽²⁾	The Company adopted ASU 2015-07 and no longer includes $126.0 million and $137.3 million as of December 31, 2015 and March 31, 2016, respectively, of investments in certain entities for which fair value was measured using net asset value (“NAV”) as a practical expedient.


⁽³⁾	Amounts are presented within Other liabilities.


⁽⁴⁾	The Company adopted ASU 2015-07 and no longer includes $75.0 million and $80.1 million as of December 31, 2015 and March 31, 2016, respectively, of liabilities for which fair value was measured using NAV as a practical expedient. These liabilities were previously included in Obligations to related parties and upon removal, the remaining liabilities were re-labeled Affiliate equity obligations.


⁽⁵⁾	Amounts are presented within Other assets or Other liabilities.

The following are descriptions of the significant financial assets and liabilities measured at fair value and the fair value methodologies used.

Cash equivalents consist primarily of highly liquid investments in daily redeeming money market funds which are classified as Level 1.

Investments in marketable securities consist primarily of investments in publicly traded securities and in funds advised by Affiliates that are valued using NAV. Publicly traded securities and investments in daily redeeming funds that calculate NAVs are classified as Level 1.

Other investments consist primarily of funds advised by Affiliates that are valued using NAV. Investments in daily redeeming funds that calculate NAVs are classified as Level 1. Investments in funds that permit redemptions monthly or quarterly are classified as Level 2.

Contingent payment arrangements represent the present value of the expected future settlement of contingent payment arrangements related to the Company’s investments in consolidated Affiliates. The significant unobservable inputs that are used in the fair value measurement of these obligations are growth and discount rates. Increases in the growth rate result in a higher obligation while an increase in the discount rate results in a lower obligation.

Affiliate equity obligations include agreements to repurchase Affiliate equity. The significant unobservable inputs that are used in the fair value measurement of the agreements to repurchase Affiliate equity are growth and discount rates. Increases in the growth rate result in a higher obligation while an increase in the discount rate results in a lower obligation.

Foreign currency forward contracts use model-derived valuations in which all significant inputs are observable in active markets to determine fair value.

It is the Company’s policy to value financial assets or liabilities transferred as of the beginning of the period in which the transfer occurs. There were no significant transfers of financial assets or liabilities between Level 1 and Level 2 in the three months ended March 31, 2015 and 2016.

Level 3 Financial Assets and Liabilities

The following tables present the changes in Level 3 liabilities:



	For the Three Months Ended March 31,
	2015							2016
	Contingent Payment Arrangements				Affiliate Equity Obligations			Contingent Payment Arrangements				Affiliate Equity Obligations
Balance, beginning of period	$	59.3			$	21.5		$	10.2			$	62.3
Net (gains) losses	(27.8		)	⁽¹⁾	—			(2.4		)	⁽¹⁾	—
Purchases and issuances	—				15.4			—				30.1
Settlements and reductions	—				(20.1		)	—				(56.8		)
Balance, end of period	$	31.5			$	16.8		$	7.8			$	35.6

Net change in unrealized (gains) losses relating to instruments still held at the reporting date	$	(27.8	)	⁽¹⁾	$	—		$	(2.4	)	⁽¹⁾	$	—

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⁽¹⁾	Accretion and changes to the Company’s contingent payment arrangements are recorded in Imputed interest expense and contingent payment arrangements.

The following table presents certain quantitative information about the significant unobservable inputs used in valuing the Company’s Level 3 financial liabilities:



	Quantitative Information about Level 3 Fair Value Measurements
	Valuation Techniques	Unobservable Input	Fair Value at December 31, 2015		Range at December 31, 2015	Fair Value at March 31, 2016		Range at March 31, 2016
Contingent payment arrangements	Discounted cash flow	Growth rates	$	10.2	3% - 8%	$	7.8	4% - 8%
		Discount rates			15%			14% - 15%
Affiliate equity obligations	Discounted cash flow	Growth rates	62.3		1% - 9%	35.6		(1)% - 11%
		Discount rates			14% - 15%			15% - 16%

Investments in Certain Entities that Calculate Net Asset Value

The Company uses the NAV of certain investments as their fair value. The NAVs that have been provided by the investees have been derived from the fair values of the underlying assets and liabilities as of the measurement dates. The following table summarizes the nature of these investments and any related liquidity restrictions or other factors which may impact the ultimate value realized:



	December 31, 2015				March 31, 2016
Category of Investment	Fair Value		Unfunded Commitments		Fair Value		Unfunded Commitments
Private equity funds⁽¹⁾	$	126.0	$	76.8	$	137.3	$	77.2
Other funds⁽²⁾	72.3		—		42.9		—
	$	198.3	$	76.8	$	180.2	$	77.2

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⁽¹⁾	These funds primarily invest in a broad range of private equity funds, as well as make direct investments. Distributions will be received as the underlying assets are liquidated over the life of the funds, which is generally up to 15 years.


⁽²⁾	These are multi-disciplinary funds that invest across various asset classes and strategies, including long/short equity, credit and real estate. Investments are generally redeemable on a daily, monthly or quarterly basis.

Other Financial Assets and Liabilities Not Carried at Fair Value

The carrying amount of Cash and cash equivalents, Receivables, and Payables and accrued liabilities approximates fair value because of the short-term nature of these instruments. The carrying value of notes receivable approximates fair value because interest rates and other terms are at market rates. The carrying value of Senior bank debt approximates fair value because the debt has variable interest based on selected short-term rates. The following table summarizes the Company’s other financial liabilities not carried at fair value:



	December 31, 2015				March 31, 2016
	Carrying Value		Fair Value		Carrying Value		Fair Value		Fair Value Hierarchy
Senior notes	$	944.6	$	966.3	$	944.7	$	954.6	Level 2
Convertible securities	305.2		483.6		305.8		476.1		Level 2