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Consolidation (Tables) | 6 Months Ended
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Jun. 30, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract] |
Condensed Consolidated Balance Sheets | The following table presents the balances of the consolidated investment products that, after intercompany eliminations, are reflected in the condensed consolidated balance sheets as of June 30, 2018 and December 31, 2017:
| As of
| June 30, 2018 |  | December 31, 2017
|  |  | VIEs |  |  |  | VIEs
| VOEs |  | CLOs |  | Other |  | VOEs |  | CLOs |  | Other
($ in thousands) |  |  |  |  |  |  |  |  |  |  |
Cash and cash equivalents | $ | 910 |  |  | $ | 40,327 |  |  | $ | 464 |  |  | $ | 820 |  |  | $ | 82,823 |  |  | $ | 18,489 |
Investments | 28,756 |  |  | 1,722,625 |  |  | 23,688 |  |  | 34,623 |  |  | 1,555,879 |  |  | 7,250 |
Other assets | 257 |  |  | 33,937 |  |  | 411 |  |  | 767 |  |  | 32,671 |  |  | 48 |
Notes payable | — |  |  | (1,569,663 | ) |  | — |  |  | — |  |  | (1,457,435 | ) |  | — |
Securities purchased payable and other liabilities | (1,073 | ) |  | (112,701 | ) |  | (614 | ) |  | (1,319 | ) |  | (110,871 | ) |  | (764 | )
Noncontrolling interests | (3,381 | ) |  | (15,971 | ) |  | (39 | ) |  | (4,178 | ) |  | (16,667 | ) |  | — |
The Company’s net interests in consolidated investment vehicles | $ | 25,469 |  |  | $ | 98,554 |  |  | $ | 23,910 |  |  | $ | 30,713 |  |  | $ | 86,400 |  |  | $ | 25,023 |
Schedule of Consolidated Collateralized Loan Obligations | Although these beneficial interests are eliminated upon consolidation, the application of the measurement alternative prescribed by ASU 2014-13, results in the net assets of the consolidated CLOs shown above to be equivalent to the beneficial interests retained by the Company at June 30, 2018, as shown in the table below:
| As of
| June 30, 2018
($ in thousands) |
Subordinated notes | $ | 97,566 |
Accrued investment management fees | 988 |
Total Beneficial Interests | $ | 98,554 |
The following table represents income and expenses of the consolidated CLOs included in the Company’s condensed consolidated statements of operations for the period indicated:
| Six Months Ended June 30,
($ in thousands) | 2018
Income: |
Realized and unrealized gain (loss), net | $ | 1,935 |
Interest income | 44,259 |
Total Income | 46,194 |
Expenses: |
Other operating expenses | 1,830 |
Interest expense | 29,827 |
Total Expense | 31,657 |
Noncontrolling interest | (767 | )
Net Income (loss) attributable to CIPs | $ | 13,770 |
As summarized in the table below, the application of the measurement alternative as prescribed by ASU 2014-13 results in the consolidated net income summarized above to be equivalent to the Company’s own economic interests in the consolidated CLOs, which are eliminated upon consolidation:
| Six Months Ended June 30,
($ in thousands) | 2018
Distributions received and unrealized gains on the subordinated notes held by the Company | $ | 10,380 |
Investment management fees | 3,390 |
Total Economic Interests | $ | 13,770 |
Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis | The Company’s assets and liabilities measured at fair value on a recurring basis, excluding the assets and liabilities of consolidated investment products, which are separately discussed in Note 15, as of June 30, 2018 and December 31, 2017 by fair value hierarchy level were as follows: June 30, 2018
| Level 1 |  | Level 2 |  | Level 3 |  | Total
($ in thousands) |  |  |  |  |  |  |
Assets |  |  |  |  |  |  |
Cash equivalents | $ | 99,441 |  |  | $ | — |  |  | $ | — |  |  | $ | 99,441 |
Marketable securities: |  |  |  |  |  |  |
Sponsored funds | 40,673 |  |  | — |  |  | — |  |  | 40,673 |
Equity securities | 17,008 |  |  | — |  |  | — |  |  | 17,008 |
Sponsored closed-end funds | 3,720 |  |  | — |  |  | — |  |  | 3,720 |
Other investments: |  |  |  |  |  |  |
Investments in collateralized loan obligations | — |  |  | — |  |  | 5,744 |  |  | 5,744 |
Nonqualified retirement plan assets | 6,909 |  |  | — |  |  | — |  |  | 6,909 |
Total assets measured at fair value | $ | 167,751 |  |  | $ | — |  |  | $ | 5,744 |  |  | $ | 173,495 |
December 31, 2017
| Level 1 |  | Level 2 |  | Level 3 |  | Total
($ in thousands) |  |  |  |  |  |  |
Assets |  |  |  |  |  |  |
Cash equivalents | $ | 72,993 |  |  | $ | — |  |  | $ | — |  |  | $ | 72,993 |
Marketable securities: |  |  |  |  |  |  |
Sponsored funds | 46,849 |  |  | — |  |  | — |  |  | 46,849 |
Equity securities | 15,810 |  |  | — |  |  | — |  |  | 15,810 |
Sponsored closed-end funds | 3,765 |  |  | — |  |  | — |  |  | 3,765 |
Other investments |  |  |  |  |  |  |
Investment in collateralized loan obligations | — |  |  | 18,900 |  |  | 4,439 |  |  | 23,339 |
Nonqualified retirement plan assets | 6,706 |  |  | — |  |  | — |  |  | 6,706 |
Total assets measured at fair value | $ | 146,123 |  |  | $ | 18,900 |  |  | $ | 4,439 |  |  | $ | 169,462 |
The assets and liabilities of the consolidated investment products measured at fair value on a recurring basis as of June 30, 2018 and December 31, 2017 by fair value hierarchy level were as follows: As of June 30, 2018
| Level 1 |  | Level 2 |  | Level 3 |  | Total
($ in thousands) |  |  |  |  |  |  |
Assets |  |  |  |  |  |  |
Cash equivalents | $ | 39,937 |  |  | $ | — |  |  | $ | — |  |  | $ | 39,937 |
Debt investments | — |  |  | 1,740,396 |  |  | 3,514 |  |  | 1,743,910 |
Equity investments | 29,241 |  |  | 1,918 |  |  | — |  |  | 31,159 |
Total Assets Measured at Fair Value | $ | 69,178 |  |  | $ | 1,742,314 |  |  | $ | 3,514 |  |  | $ | 1,815,006 |
Liabilities |  |  |  |  |  |  |
Notes payable | $ | — |  |  | $ | 1,569,663 |  |  | $ | — |  |  | $ | 1,569,663 |
Short sales | 804 |  |  | — |  |  | — |  |  | 804 |
Total Liabilities Measured at Fair Value | $ | 804 |  |  | $ | 1,569,663 |  |  | $ | — |  |  | $ | 1,570,467 |
As of December 31, 2017
| Level 1 |  | Level 2 |  | Level 3 |  | Total
($ in thousands) |  |  |  |  |  |  |
Assets |  |  |  |  |  |  |
Cash equivalents | $ | 82,769 |  |  | $ | — |  |  | $ | — |  |  | $ | 82,769 |
Debt investments | — |  |  | 1,527,845 |  |  | 33,887 |  |  | 1,561,732 |
Equity investments | 35,126 |  |  | — |  |  | 894 |  |  | 36,020 |
Total Assets Measured at Fair Value | $ | 117,895 |  |  | $ | 1,527,845 |  |  | $ | 34,781 |  |  | $ | 1,680,521 |
Liabilities |  |  |  |  |  |  |
Notes payable | $ | — |  |  | $ | 1,457,435 |  |  | $ | — |  |  | $ | 1,457,435 |
Derivatives | 2 |  |  | — |  |  | — |  |  | 2 |
Short sales | 719 |  |  | — |  |  | — |  |  | 719 |
Total Liabilities Measured at Fair Value | $ | 721 |  |  | $ | 1,457,435 |  |  | $ | — |  |  | $ | 1,458,156 |
Reconciliation of Assets of Consolidated Sponsored Investment Products For Level 3 Investments, Unobservable Inputs Used to Determine Fair Value | The following table is a reconciliation of assets for Level 3 investments for which significant unobservable inputs were used to determine fair value.
| Three Months Ended June 30, |  | Six Months Ended June 30,
($ in thousands) | 2018 |  | 2017 |  | 2018 |  | 2017
Level 3 Investments (a) |  |  |  |  |  |  |
Balance at beginning of period | $ | 5,532 |  |  | $ | — |  |  | $ | 4,439 |  |  | $ | — |
Acquired in period | — |  |  | 2,916 |  |  | 1,326 |  |  | 2,916 |
Change in unrealized gain (loss), net | 212 |  |  | 7 |  |  | (21 | ) |  | 7 |
Balance at end of period | $ | 5,744 |  |  | $ | 2,923 |  |  | $ | 5,744 |  |  | $ | 2,923 |
(a) The investments that are categorized as Level 3 were valued utilizing third-party pricing information without adjustment.
The following table is a reconciliation of assets of consolidated investment products for Level 3 investments for which significant unobservable inputs were used to determine fair value:
| Six Months Ended June 30,
($ in thousands) | 2018 |  | 2017
Level 3 Debt and Equity securities (a) |  |  |
Balance at beginning of period | $ | 34,781 |  |  | $ | 25 |
Realized gains (losses), net | 1,993 |  |  | (4 | )
Change in unrealized gains (losses), net | 575 |  |  | — |
Acquired in business combination | — |  |  | 9,150 |
Purchases | 7,122 |  |  | 100 |
Paydowns | — |  |  | — |
Amortization | 19 |  |  | — |
Sales | (13,884 | ) |  | (121 | )
Transfers to Level 2 | (30,606 | ) |  | — |
Transfers from Level 2 | 3,514 |  |  | — |
Balance at end of period | $ | 3,514 |  |  | $ | 9,150 |
(a) | The investments that are categorized as Level 3 were valued utilizing third-party pricing information without adjustment. All transfers are deemed to occur at the end of period. Transfers between Level 2 and Level 3 are due to trading activities at period end.

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- Definition Tabular disclosure of condensed balance sheet, including, but not limited to, balance sheets of consolidated entities and consolidation eliminations. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 3 -Paragraph i -Subsection 10 + Details
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- Definition Tabular disclosure of the fair value measurement of assets using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets) and gains or losses recognized in other comprehensive income (loss), and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs), by class of asset. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=99377789&loc=d3e19279-110258 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (c) -URI http://asc.fasb.org/extlink&oid=99377789&loc=d3e19207-110258 + Details
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- Definition Tabular disclosure of assets and liabilities, including [financial] instruments measured at fair value that are classified in stockholders' equity, if any, that are measured at fair value on a recurring basis. The disclosures contemplated herein include the fair value measurements at the reporting date by the level within the fair value hierarchy in which the fair value measurements in their entirety fall, segregating fair value measurements using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3). + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=99377789&loc=d3e19190-110258 + Details
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- Definition Tabular disclosure of the significant judgments and assumptions made in determining whether a variable interest (as defined) held by the entity requires the variable interest entity (VIE) (as defined) to be consolidated and (or) disclose information about its involvement with the VIE, individually or in aggregate (as applicable); the nature of restrictions, if any, on the consolidated VIE's assets and on the settlement of its liabilities reported by an entity in its statement of financial position, including the carrying amounts of such assets and liabilities; the nature of, and changes in, the risks associated with involvement in the VIE; how involvement with the VIE affects the entity's financial position, financial performance, and cash flows; the lack of recourse if creditors (or beneficial interest holders) of the consolidated VIE have no recourse to the general credit of the primary beneficiary (if applicable); the terms of arrangements, giving consideration to both explicit arrangements and implicit variable interests, if any, that could require the entity to provide financial support to the VIE, including events or circumstances that could expose the entity to a loss; the methodology used by the entity for determining whether or not it is the primary beneficiary of the variable interest entity; the significant factors considered and judgments made in determining that the power to direct the activities of a VIE that most significantly impact the VIE's economic performance are shared (as defined); the carrying amounts and classification of assets and liabilities of the VIE included in the statement of financial position; the entity's maximum exposure to loss, if any, as a result of its involvement with the VIE, including how the maximum exposure is determined and significant sources of the entity's exposure to the VIE; a comparison of the carrying amounts of the assets and liabilities and the entity's maximum exposure to loss; information about any liquidity arrangements, guarantees, and (or) other commitments by third parties that may affect the fair value or risk of the entity's variable interest in the VIE; whether or not the entity has provided financial support or other support (explicitly or implicitly) to the VIE that it was not previously contractually required to provide or whether the entity intends to provide that support, including the type and amount of the support and the primary reasons for providing the support; and supplemental information the entity determines necessary to provide. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 810 -SubTopic 10 -Section 50 -Paragraph 5A -URI http://asc.fasb.org/extlink&oid=108788376&loc=SL6759159-111685 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 810 -SubTopic 10 -Section 50 -Paragraph 6 -URI http://asc.fasb.org/extlink&oid=108788376&loc=d3e5747-111685 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 810 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=108788376&loc=SL6228884-111685 Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 810 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=108788376&loc=d3e5710-111685 Reference 5: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 810 -SubTopic 10 -Section 50 -Paragraph 4 -URI http://asc.fasb.org/extlink&oid=108788376&loc=d3e5728-111685 + Details
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