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, 2018		Fair Value Measurements
	December 31, 2018		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets
Investments in marketable securities	$	119.3	$	119.3	$	—	$	—
Derivative financial instruments⁽¹⁾	5.8		—		5.8		—
Financial Liabilities⁽²⁾
Contingent payment arrangements	$	1.9	$	—	$	—	$	1.9
Affiliate equity repurchase obligations	36.2		—		—		36.2
Derivative financial instruments	1.4		—		1.4		—



			Fair Value Measurements
	March 31, 2019		Fair Value Measurements
	March 31, 2019		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets
Investments in marketable securities	$	36.4	$	36.4	$	—	$	—
Derivative financial instruments⁽¹⁾	1.4		—		1.4		—
Financial Liabilities⁽²⁾
Contingent payment arrangements	$	2.0	$	—	$	—	$	2.0
Affiliate equity repurchase obligations	75.4		—		—		75.4
Derivative financial instruments	0.0		—		0.0		—

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⁽¹⁾	Amounts are presented within Other assets.


⁽²⁾	Amounts are presented within Other liabilities.

Level 3 Financial Assets and Liabilities

The following table presents the changes in level 3 liabilities:



	For the Three Months Ended March 31,
	2018					2019
	Contingent Payment Arrangements		Affiliate Equity Repurchase Obligations			Contingent Payment Arrangements		Affiliate Equity Repurchase Obligations
Balance, beginning of period	$	9.4	$	49.2		$	1.9	$	36.2
Net realized and unrealized losses⁽¹⁾	0.4		—			0.1		—
Purchases and issuances⁽²⁾	—		45.6			—		54.6
Settlements and reductions	—		(15.4		)	—		(15.4		)
Balance, end of period	$	9.8	$	79.4		$	2.0	$	75.4

Net change in unrealized losses relating to instruments still held at the reporting date	$	0.4	$	—		$	0.3	$	—

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⁽¹⁾	Accretion expense for these arrangements is recorded in Interest expense.


⁽²⁾	Includes transfers from Redeemable non-controlling interests.

The following table presents certain quantitative information about the significant unobservable inputs used in valuing the Company’s level 3 fair value measurements:



	Quantitative Information About Level 3 Fair Value Measurements
			December 31, 2018				March 31, 2019
	Valuation Techniques	Unobservable Input	Fair Value		Range	Weighted Average	Fair Value		Range	Weighted Average
Contingent payment arrangements	Discounted cash flow	Growth rates	$	1.9	7%	7%	$	2.0	7%	7%
		Discount rates			15%	15%			15%	15%
Affiliate equity repurchase obligations	Discounted cash flow	Growth rates	36.2		(4)% - 9%	3%	75.4		(4)% - 9%	5%
		Discount rates			14% - 16%	15%			13% - 17%	15%

Contingent payment arrangements represent the present value of the expected future settlement amounts related to the Company’s investments in consolidated Affiliates. As of March 31, 2019, there were no changes to growth rates or discount rates that had a significant impact to contingent payment arrangements.

Affiliate equity repurchase obligations include agreements to repurchase Affiliate equity. As of March 31, 2019, there were no changes to growth or discount rates that had a significant impact to Affiliate equity repurchase obligations recorded in prior periods.

Investments Measured at NAV as a Practical Expedient

The Company’s Affiliates sponsor investment products in which the Company and its Affiliates may make general partner and seed capital investments. The Company uses the net asset value (“NAV”) of these investments as a practical expedient for their fair values and reports these investments within Other investments. The following table summarizes the fair values of these investments and unfunded commitments:



	December 31, 2018				March 31, 2019
Category of Investment	Fair Value		Unfunded Commitments		Fair Value		Unfunded Commitments
Private equity funds⁽¹⁾	$	193.2	$	131.0	$	198.5	$	146.6
Other funds⁽²⁾	7.9		—		9.0		—
Other investments⁽³⁾	$	201.1	$	131.0	$	207.5	$	146.6

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⁽¹⁾	The Company uses NAV as a practical expedient one quarter in arrears (adjusted for current period calls and distributions) to determine the fair value. These funds primarily invest in a broad range of private equity funds, as well as making 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.


⁽³⁾	Fair value attributable to the controlling interest was $123.2 million and $131.3 million as of December 31, 2018 and March 31, 2019, respectively.

Other Financial Assets and Liabilities Not Carried at Fair Value

The Company has other financial assets and liabilities, which are not required to be carried at fair value, but the Company is required to disclose their fair values. 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, which is reported in Other assets, approximates fair value because interest rates and other terms are at market rates. The carrying value of the credit facilities approximates fair value because the credit facilities have 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, 2018				March 31, 2019
	Carrying Value		Fair Value		Carrying Value		Fair Value		Fair Value Hierarchy
Senior notes	$	746.2	$	747.5	$	746.4	$	760.6	Level 2
Junior convertible securities	312.5		391.5		313.2		436.7		Level 2
Junior subordinated notes	—		—		271.3		275.3		Level 2