15. 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 and 2020 Notes and 2022 Notes (collectively, the “Senior Notes”). The guarantees are full and unconditional and joint and several. All of the guarantors are 100%-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 March 31, 2014


	FTI Consulting, Inc.		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations			Consolidated
Assets
Cash and cash equivalents	$	23,393	$	155	$	53,457	$	—		$	77,005
Accounts receivable, net		172,000		200,057		173,015		—			545,072
Intercompany receivables		—		744,461		18,299		(762,760	)		—
Other current assets		59,876		22,353		26,920		—			109,149

Total current assets		255,269		967,026		271,691		(762,760	)		731,226
Property and equipment, net		33,706		16,110		36,177		—			85,993
Goodwill		559,613		408,904		252,801		—			1,221,318
Other intangible assets, net		32,674		18,805		64,789		(27,397	)		88,871
Investments in subsidiaries		1,841,421		500,769		—		(2,342,190	)		—
Other assets		68,315		80,253		36,591		—			185,159

Total assets	$	2,790,998	$	1,991,867	$	662,049	$	(3,132,347	)	$	2,312,567

Liabilities
Intercompany payables	$	685,394	$	31,833	$	45,533	$	(762,760	)	$	—
Other current liabilities		128,071		75,460		95,679		—			299,210

Total current liabilities		813,465		107,293		141,212		(762,760	)		299,210
Long-term debt, net		700,000		11,000		—		—			711,000
Other liabilities		200,505		11,998		12,826		—			225,329

Total liabilities		1,713,970		130,291		154,038		(762,760	)		1,235,539
Stockholders’ equity		1,077,028		1,861,576		508,011		(2,369,587	)		1,077,028

Total liabilities and stockholders’ equity	$	2,790,998	$	1,991,867	$	662,049	$	(3,132,347	)	$	2,312,567

Condensed Consolidating Balance Sheet Information as of December 31, 2013


	FTI Consulting, Inc.		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations			Consolidated
Assets
Cash and cash equivalents	$	111,943	$	494	$	93,396	$	—		$	205,833
Accounts receivable, net		154,357		162,505		159,583		—			476,445
Intercompany receivables		—		820,158		18,881		(839,039	)		—
Other current assets		68,292		20,932		32,359		—			121,583

Total current assets		334,592		1,004,089		304,219		(839,039	)		803,861
Property and equipment, net		31,304		19,047		28,656		—			79,007
Goodwill		559,820		408,903		250,010		—			1,218,733
Other intangible assets, net		33,746		19,534		72,221		(28,353	)		97,148
Investments in subsidiaries		1,772,130		498,001		—		(2,270,131	)		—
Other assets		75,561		56,949		33,688		—			166,198

Total assets	$	2,807,153	$	2,006,523	$	688,794	$	(3,137,523	)	$	2,364,947

Liabilities
Intercompany payables	$	709,628	$	74,813	$	54,598	$	(839,039	)	$	—
Other current liabilities		154,049		114,883		115,398		—			384,330

Total current liabilities		863,677		189,696		169,996		(839,039	)		384,330
Long-term debt, net		700,000		11,000		—		—			711,000
Other liabilities		201,217		15,009		11,132		—			227,358

Total liabilities		1,764,894		215,705		181,128		(839,039	)		1,322,688
Stockholders’ equity		1,042,259		1,790,818		507,666		(2,298,484	)		1,042,259

Total liabilities and stockholders’ equity	$	2,807,153	$	2,006,523	$	688,794	$	(3,137,523	)	$	2,364,947

Condensed Consolidating Statement of Comprehensive Income for the Three Months Ended

March 31, 2014


	FTI Consulting, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenues	$	151,032		$	252,083		$	120,527		$	(98,090	)	$	425,552
Operating expenses
Direct cost of revenues		99,498			195,699			76,857			(97,779	)		274,275
Selling, general and administrative expense		45,298			28,500			34,900			(311	)		108,387
Acquisition-related contingent consideration		(598	)		(603	)		(642	)		—			(1,843	)
Amortization of other intangible assets		1,073			729			3,771			(957	)		4,616

Operating income		5,761			27,758			5,641			957			40,117
Other (expense) income		(13,314	)		(2,266	)		3,928			—			(11,652	)

Income before income tax provision		(7,553	)		25,492			9,569			957			28,465
Income tax (benefit) provision		(2,858	)		11,046			2,160			—			10,348
Equity in net earnings of subsidiaries		22,812			6,333			—			(29,145	)		—

Net income	$	18,117		$	20,779		$	7,409		$	(28,188	)	$	18,117

Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments, net of tax $0		—			—			4,728			—			4,728

Total other comprehensive income, net of tax		—			—			4,728			—			4,728

Comprehensive income	$	18,117		$	20,779		$	12,137		$	(28,188	)	$	22,845

Condensed Consolidating Statement of Comprehensive Income for the Three Months Ended

March 31, 2013


	FTI Consulting, Inc.			Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenues	$	150,960		$	246,661	$	107,996		$	(98,439	)	$	407,178
Operating expenses
Direct cost of revenues		100,837			187,347		67,973			(97,677	)		258,480
Selling, general and administrative expense		42,896			27,976		26,538			(763	)		96,647
Special Charges		323			104		—			—			427
Acquisition-related contingent consideration		87			—		644			—			731
Amortization of other intangible assets		1,227			2,447		2,683			(793	)		5,564

Operating income		5,590			28,787		10,158			794			45,329
Other (expense) income		(14,940	)		329		2,833			—			(11,778	)

Income before income tax provision		(9,350	)		29,116		12,991			794			33,551
Income tax (benefit) provision		(2,931	)		9,972		2,830						9,871
Equity in net earnings of subsidiaries		30,099			8,435		—			(38,534	)		—

Net income	$	23,680		$	27,579	$	10,161		$	(37,740	)	$	23,680

Other comprehensive income, net of tax:
Foreign currency translation adjustments, net of tax $0		—			—		(15,509	)		—			(15,509	)

Total other comprehensive income (loss), net of tax		—			—		(15,509	)		—			(15,509	)

Comprehensive income	$	23,680		$	27,579	$	(5,348	)	$	(37,740	)	$	8,171

Condensed Consolidating Statement of Cash Flow for the Three Months Ended March 31, 2014


	FTI Consulting, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidated
Operating activities
Net cash (used in) provided by operating activities	$	(16,876	)	$	(80,076	)	$	(13,843	)	$	(110,795	)
Investing activities
Payments for acquisition of businesses, net of cash received		(14,616	)		—			(995	)		(15,611	)
Purchases of property and equipment		(5,008	)		(1,047	)		(9,124	)		(15,179	)
Other		(10	)		—			—			(10	)

Net cash used in investing activities		(19,634	)		(1,047	)		(10,119	)		(30,800	)

Financing activities
Borrowings under revolving line of credit, net		20,000			—			—			20,000
Issuance of common stock		(2,490	)		—			—			(2,490	)
Purchase and retirement of common stock		(4,367	)		—			—			(4,367	)
Other		442			(63	)		(480	)		(101	)
Intercompany transfers		(65,625	)		80,847			(15,222	)		—

Net cash provided by (used in) financing activities		(52,040	)		80,784			(15,702	)		13,042

Effect of exchange rate changes on cash and cash equivalents		—			—			(275	)		(275	)

Net decrease in cash and cash equivalents		(88,550	)		(339	)		(39,939	)		(128,828	)
Cash and cash equivalents, beginning of period		111,943			494			93,396			205,833

Cash and cash equivalents, end of period	$	23,393		$	155		$	53,457		$	77,005

Condensed Consolidating Statement of Cash Flow for the Three Months Ended March 31, 2013


	FTI Consulting, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidated
Operating activities
Net cash (used in) provided by operating activities	$	(17,853	)	$	2,610		$	12,939		$	(2,304	)
Investing activities
Payments for acquisition of businesses, net of cash received		(8,078	)		(6,598	)		—			(14,676	)
Purchases of property and equipment		(754	)		(5,338	)		(1,231	)		(7,323	)
Other		12			—			—			12

Net cash used in investing activities		(8,820	)		(11,936	)		(1,231	)		(21,987	)

Financing activities
Purchase and retirement of common stock		(28,758	)		—			—			(28,758	)
Net issuance of common stock and other		(1,335	)		—			—			(1,335	)
Other		105						(205	)		(100	)
Intercompany transfers		18,039			8,997			(27,036	)		—

Net cash (used in) provided by financing activities		(11,949	)		8,997			(27,241	)		(30,193	)

Effect of exchange rate changes on cash and cash equivalents		—			—			(1,598	)		(1,598	)

Net decrease in cash and cash equivalents		(38,622	)		(329	)		(17,131	)		(56,082	)
Cash and cash equivalents, beginning of period		66,663			610			89,512			156,785

Cash and cash equivalents, end of period	$	28,041		$	281		$	72,381		$	100,703