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Business Combinations | 3 Months Ended
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Mar. 31, 2022
Business Combination and Asset Acquisition [Abstract] |
Business Combinations | BUSINESS COMBINATIONS Business Combinations During the three months ended March 31, 2022, we completed the following acquisition: •Effective January 1, 2022, we acquired all of the non-attest assets of Marks Paneth LLP ("Marks Paneth"). Marks Paneth, based in New York City, is a provider of a full range of accounting, tax and consulting services to a wide range of industries. Marks Paneth is included as a component of our Financial Services practice group. Mayer Hoffman, an unrelated party, acquired the attest assets from Marks Paneth in a separate transaction. Operating results are reported in the Financial Services practice group. During the three months ended March 31, 2021, we completed the following acquisition: •Effective January 1, 2021, we acquired substantially all the assets of Middle Market Advisory Group (“MMA”). MMA, based in Englewood, Colorado, is a provider of tax compliance and consulting services to middle market companies and family groups in the real estate, automotive, technology and SAAS, construction, and manufacturing industries. Operating results are reported in the Financial Services practice group. The acquisition of Marks Paneth is expected to add approximately $138.0 million revenue in 2022. For the three months ended March 31, 2022, we recorded approximately $6.0 million non-recurring transaction, retention and integration related costs associated with this acquisition. Pro forma results of operations for these acquisitions have not been presented because the effects of these acquisitions were not material, either individually or in aggregate, to our total revenue, income from continuing operations, and net income for the three months ended March 31, 2022 and 2021, respectively. The following table summarizes the consideration and preliminary purchase price allocation for the acquisitions completed during the three months ended March 31, 2022 and 2021, respectively (in thousands):
| 2022 |  | 2021 |
Cash paid | 72,469 |  |  | 1,900 |  |
Recorded contingent consideration | 64,648 |  |  | 1,622 |  |
Total recorded purchase price | $ | 137,117 |  |  | $ | 3,522 |  |
Accounts receivable acquired | 18,230 |  |  | — |  |
Fixed assets acquired | 1,793 |  |  | — |  |
Identifiable intangible assets acquired | 48,000 |  |  | 2,069 |  |
Operating lease right-of-use asset acquired | 49,291 |  |  | — |  |
Other assets acquired | 1,497 |  |  | — |  |
Operating lease liability acquired - current | (5,860) |  |  | — |  |
Other current liabilities acquired | (909) |  |  | — |  |
Operating lease liability acquired - noncurrent | (43,431) |  |  | — |  |
Goodwill | 68,506 |  |  | 1,453 |  |
Total net assets acquired | $ | 137,117 |  |  | $ | 3,522 |  |
Maximum potential contingent consideration | $ | 67,115 |  |  | $ | 1,700 |  |
Provisional estimates of fair value are established at the time of each acquisition and are subsequently reviewed within the first year of operations subsequent to the acquisition date to determine the necessity for adjustments. Fair value estimates of the Marks Paneth acquisition were provisional as of March 31, 2022, primarily related to the value established for certain identifiable intangible assets and contingent purchase price consideration. The following table summarizes the goodwill and intangible asset amounts resulting from those acquisitions for the three months ended March 31, 2022 and 2021, respectively (in thousands):
| Three Months Ended March 31,
| 2022 |  | 2021
| Financial Services |  |  |  | Financial Services |  |
Goodwill | $ | 68,506 |  |  |  |  | $ | 1,453 |  |  |
Client list | 48,000 |  |  |  |  | 1,980 |  |  |
Other intangibles | — |  |  |  |  | 89 |  |  |
Total | $ | 116,506 |  |  |  |  | $ | 3,522 |  |  |
Goodwill is calculated as the difference between the aggregated purchase price and the fair value of the net assets acquired. Goodwill represents the value of expected future earnings and cash flows, as well as the synergies created by the integration of the new businesses within our organization, including cross-selling opportunities expected with our Financial Services practice group and the Benefits and Insurance Services practice group, to help strengthen our existing service offerings and expand our market position. Goodwill related to these acquisitions is deductible for tax purposes. Client lists have an expected life of 10 years, and other intangibles, primarily non-compete agreements, have an expected life of 3 years. Client lists and non-compete agreements are valued using a discounted cash flow technique based on management estimates of future cash flows from such assets. The following table summarizes the changes in contingent purchase price consideration for previous acquisitions and contingent payments made for previous business acquisitions in the three months ended March 31, 2022 and 2021, respectively (in thousands):
|  |  | Three Months Ended March 31,
|  |  |  |  | 2022 |  | 2021
Net expense |  |  |  |  | $ | 642 |  |  | $ | 660 |
Cash settlement paid |  |  |  |  | $ | 7,077 |  |  | $ | 1,463 |
Shares issued (number) |  |  |  |  | 19 |  | 38

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- Definition The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable). + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -URI http://asc.fasb.org/topic&trid=2303972 + Details
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