14. Supplemental Condensed Consolidating Guarantor and Non-Guarantor Financial Information

Substantially all of our domestic subsidiaries are guarantors of borrowings under our senior bank credit facility, senior notes and our Convertible Notes. The guarantees are full and unconditional and joint and several. All of our guarantors are wholly-owned, direct or indirect, subsidiaries.

The following financial information presents condensed consolidating balance sheets, statements of comprehensive income and statements of cash flows for FTI Consulting, all the guarantor subsidiaries, all the non-guarantor subsidiaries and the eliminations necessary to arrive at the consolidated information for FTI Consulting and its subsidiaries. For purposes of this presentation, we have accounted for our investments in our subsidiaries using the equity method of accounting. The principal eliminating entries eliminate investment in subsidiary and intercompany balances and transactions.

Condensed Consolidating Balance Sheet Information as of June 30, 2012


	FTI Consulting, Inc.		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations			Consolidated
Assets
Cash and cash equivalents	$	72,077	$	93	$	93,811	$	—		$	165,981
Restricted cash		—		—		1,152		—			1,152
Accounts receivable, net		177,752		175,309		119,598		—			472,659
Intercompany receivables		—		562,935		139,409		(702,344	)		—
Other current assets		30,472		23,039		31,133		—			84,644

Total current assets		280,301		761,376		385,103		(702,344	)		724,436
Property and equipment, net		38,163		15,910		14,734		—			68,807
Goodwill		549,271		439,070		325,041		—			1,313,382
Other intangible assets, net		36,312		28,953		75,762		(33,245	)		107,782
Investments in subsidiaries		1,624,119		533,424		—		(2,157,543	)		—
Other assets		77,911		104,457		23,858		(46,552	)		159,674

Total assets	$	2,606,077	$	1,883,190	$	824,498	$	(2,939,684	)	$	2,374,081

Liabilities
Intercompany payables	$	457,320	$	87,916	$	157,108	$	(702,344	)	$	—
Other current liabilities		262,793		85,562		67,082		—			415,437

Total current liabilities		720,113		173,478		224,190		(702,344	)		415,437
Long-term debt, net		620,078		23,000		—		—			643,078
Other liabilities		115,563		36,185		60,047		(46,552	)		165,243

Total liabilities		1,455,754		232,663		284,237		(748,896	)		1,223,758
Stockholders’ equity		1,150,323		1,650,527		540,261		(2,190,788	)		1,150,323

Total liabilities and stockholders’ equity	$	2,606,077	$	1,883,190	$	824,498	$	(2,939,684	)	$	2,374,081

Condensed Consolidating Balance Sheet Information as of December 31, 2011


	FTI Consulting, Inc.		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations			Consolidated
Assets
Cash and cash equivalents	$	161,180	$	197	$	103,046	$	—		$	264,423
Restricted cash		8,632		—		1,581		—			10,213
Accounts receivable, net		148,698		165,871		114,533		—			429,102
Intercompany receivables		—		557,846		59,857		(617,703	)		—
Other current assets		22,599		15,694		28,923		—			67,216

Total current assets		341,109		739,608		307,940		(617,703	)		770,954
Property and equipment, net		44,233		14,240		15,975		—			74,448
Goodwill		547,667		439,068		322,623		—			1,309,358
Other intangible assets, net		38,913		34,692		45,284		—			118,889
Investments in subsidiaries		1,538,883		532,091		—		(2,070,974	)		—
Other assets		70,551		48,529		18,355		—			137,435

Total assets	$	2,581,356	$	1,808,228	$	710,177	$	(2,688,677	)	$	2,411,084

Liabilities
Intercompany payables	$	433,284	$	93,947	$	90,472	$	(617,703	)	$	—
Other current liabilities		316,559		109,651		71,627		—			497,837

Total current liabilities		749,843		203,598		162,099		(617,703	)		497,837
Long-term debt, net		620,579		23,000		—		—			643,579
Other liabilities		104,732		43,297		15,437		—			163,466

Total liabilities		1,475,154		269,895		177,536		(617,703	)		1,304,882
Stockholders’ equity		1,106,202		1,538,333		532,641		(2,070,974	)		1,106,202

Total liabilities and stockholders’ equity	$	2,581,356	$	1,808,228	$	710,177	$	(2,688,677	)	$	2,411,084

Condensed Consolidating Statement of Comprehensive Income (Loss) for the Three Months Ended June 30, 2012


	FTI Consulting, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenues	$	151,442		$	241,033		$	101,451		$	(97,683	)	$	396,243
Operating expenses
Direct cost of revenues		96,450			180,788			66,080			(95,098	)		248,220
Selling, general and administrative expense		39,041			28,507			27,497			(2,585	)		92,460
Special Charges		16,731			4,287			5,764						26,782
Acquisition-related contingent consideration		—			—			(3,541	)		—			(3,541	)
Amortization of other intangible assets		1,297			2,473			2,541			(821	)		5,490

Operating income		(2,077	)		24,978			3,110			821			26,832
Other (expense) income		(17,469	)		(195	)		2,106			—			(15,558	)

Income (loss) before income tax provision		(19,546	)		24,783			5,216			821			11,274
Income tax (benefit) provision		(9,666	)		12,910			283			—			3,527
Equity in net earnings of subsidiaries		17,627			5,741			—			(23,368	)		—

Net income		7,747			17,614			4,933			(22,547	)		7,747

Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments including tax benefit of $0		—			—			(10,960	)		—			(10,960	)

Other comprehensive income (loss), net of tax		—			—			(10,960	)		—			(10,960	)

Comprehensive income (loss)	$	7,747		$	17,614		$	(6,027	)	$	(22,547	)	$	(3,213	)

Condensed Consolidating Statement of Comprehensive Income for the Three Months Ended June 30, 2011


	FTI Consulting, Inc.			Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenues	$	144,100		$	254,289	$	103,392		$	(101,344	)	$	400,437
Operating expenses
Direct cost of revenues		98,220			182,954		68,010			(98,340	)		250,844
Selling, general and administrative expense		40,697			30,565		26,184			(3,004	)		94,442
Special Charges		8,561			228		6,423						15,212
Acquisition-related contingent consideration		—			—		799			—			799
Amortization of other intangible assets		605			3,264		1,629			—			5,498

Operating income		(3,983	)		37,278		347			—			33,642
Other (expense) income		(12,595	)		759		259			—			(11,577	)

Income (loss) before income tax provision		(16,578	)		38,037		606			—			22,065
Income tax (benefit) provision		(7,658	)		16,830		(2,432	)		—			6,740
Equity in net earnings of subsidiaries		24,245			2,944		—			(27,189	)		—

Net income		15,325			24,151		3,038			(27,189	)		15,325

Other comprehensive income, net of tax:
Foreign currency translation adjustments including tax expense of $100		(100	)		—		1,936			—			1,836

Other comprehensive income, net of tax		(100	)		—		1,936			—			1,836

Comprehensive income	$	15,225		$	24,151	$	4,974		$	(27,189	)	$	17,161

Condensed Consolidating Statement of Comprehensive Income for the Six Months Ended June 30, 2012


	FTI Consulting, Inc.			Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenues	$	305,023		$	482,749	$	203,509		$	(199,810	)	$	791,471
Operating expenses
Direct cost of revenues		197,625			362,737		128,999			(195,523	)		493,838
Selling, general and administrative expense		86,435			57,559		55,342			(4,287	)		195,049
Special charges		16,731			4,287		5,764			—			26,782
Acquisition-related contingent consideration		—			—		(2,984	)		—			(2,984	)
Amortization of other intangible assets		2,600			4,950		5,097			(1,640	)		11,007

Operating income		1,632			53,216		11,291			1,640			67,779
Other (expense) income		(30,456	)		35,987		1,874			(34,885	)		(27,480	)

Income (loss) before income tax provision		(28,824	)		89,203		13,165			(33,245	)		40,299
Income tax (benefit) provision		(28,380	)		40,724		1,777			—			14,121
Equity in net earnings of subsidiaries		26,622			13,383		—			(40,005	)		—

Net income		26,178			61,862		11,388			(73,250	)		26,178

Other comprehensive income, net of tax:
Foreign currency translation adjustments net of tax benefit of $0		—			—		1,889			—			1,889

Other comprehensive income, net of tax		—			—		1,889			—			1,889

Comprehensive income	$	26,178		$	61,862	$	13,277		$	(73,250	)	$	28,067

Condensed Consolidating Statement of Comprehensive Income for the Six Months Ended June 30, 2011


	FTI Consulting, Inc.			Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenues	$	270,751		$	507,388	$	180,391		$	(196,277	)	$	762,253
Operating expenses
Direct cost of revenues		181,941			363,720		119,589			(191,322	)		473,928
Selling, general and administrative expense		76,585			64,818		46,297			(4,955	)		182,745
Special charges		8,561			228		6,423			—			15,212
Acquisition-related contingent consideration		—			—		1,595			—			1,595
Amortization of other intangible assets		879			6,859		3,214			—			10,952

Operating income		2,785			71,763		3,273			—			77,821
Other (expense) income		(25,680	)		557		236			—			(24,887	)

Income (loss) before income tax provision		(22,895	)		72,320		3,509			—			52,934
Income tax (benefit) provision		(10,208	)		30,088		(1,529	)		—			18,351
Equity in net earnings of subsidiaries		47,270			4,455		—			(51,725	)		—

Net income		34,583			46,687		5,038			(51,725	)		34,583

Other comprehensive income, net of tax:
Foreign currency translation adjustments net of tax benefit of $2,068		2,068			—		14,587			—			16,655

Other comprehensive income, net of tax		2,068			—		14,587			—			16,655

Comprehensive income	$	36,651		$	46,687	$	19,625		$	(51,725	)	$	51,238

Condensed Consolidating Statement of Cash Flow for the Six Months Ended June 30, 2012


	FTI Consulting, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidated
Operating activities
Net cash (used in) provided by operating activities	$	(70,726	)	$	336		$	13,102		$	(57,288	)
Investing activities
Payments for acquisition of businesses, net of cash received		(21,186	)		—			(364	)		(21,550	)
Purchases of property and equipment		(3,384	)		(8,350	)		(1,994	)		(13,728	)
Other		93			—			—			93

Net cash used in investing activities		(24,477	)		(8,350	)		(2,358	)		(35,185	)

Financing activities
Payments of long-term debt and capital lease obligations		(1,929	)		(45	)		—			(1,974	)
Net issuance of common stock and other		(948	)		—			(1,287	)		(2,235	)
Excess tax benefits from share-based compensation		71			—			—			71
Intercompany transfers		8,906			7,955			(16,861	)		—

Net cash provided by (used in) financing activities		6,100			7,910			(18,148	)		(4,138	)

Effect of exchange rate changes on cash and cash equivalents		—			—			(1,831	)		(1,831	)

Net decrease in cash and cash equivalents		(89,103	)		(104	)		(9,235	)		(98,442	)
Cash and cash equivalents, beginning of period		161,180			197			103,046			264,423

Cash and cash equivalents, end of period	$	72,077		$	93		$	93,811		$	165,981

Condensed Consolidating Statement of Cash Flow for the Six Months Ended June 30, 2011


	FTI Consulting, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidated
Operating activities
Net cash (used in) provided by operating activities	$	(33,412	)	$	42,156		$	(21,568	)	$	(12,824	)
Investing activities
Payments for acquisition of businesses, net of cash received		(33,735	)		—			(17,153	)		(50,888	)
Purchases of property and equipment		(4,058	)		(6,192	)		(2,455	)		(12,705	)
Other		(405	)		—			—			(405	)

Net cash used in investing activities		(38,198	)		(6,192	)		(19,608	)		(63,998	)

Financing activities
Borrowings under revolving line of credit		25,000			—			—			25,000
Payments of revolving line of credit		(25,000	)		—			—			(25,000	)
Payments of long-term debt and capital lease obligations		(776	)		(161	)		—			(937	)
Issuance of common stock and other		736			—			—			736
Purchase and retirement of common stock		(209,400	)		—			—			(209,400	)
Excess tax benefits from share-based compensation		124			—			—			124
Intercompany transfers		12,285			(36,862	)		24,577			—

Net cash (used in) provided by financing activities		(197,031	)		(37,023	)		24,577			(209,477	)

Effect of exchange rate changes on cash and cash equivalents		—			—			474			474

Net decrease in cash and cash equivalents		(268,641	)		(1,059	)		(16,125	)		(285,825	)
Cash and cash equivalents, beginning of period		292,738			1,430			90,402			384,570

Cash and cash equivalents, end of period	$	24,097		$	371		$	74,277		$	98,745