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Selected Balance Sheet Data | 9 Months Ended
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Sep. 30, 2016
Organization, Consolidation and Presentation of Financial Statements [Abstract] |
Selected Balance Sheet Data |
3. | Selected Balance Sheet Data
Other Assets Other assets consisted of the following (in thousands):
|  | Current |  |  | Non-Current |
|  | September 30, |  |  | December 31, |  |  | September 30, |  |  | December 31, |
|  | 2016 |  |  | 2015 |  |  | 2016 |  |  | 2015 |
Due from independent contractors, net (1) (2) |  | $ | 1,783 |  |  | $ | 2,545 |  |  | $ | 7,678 |  |  | $ | 7,358 |
Security deposits |  |  | — |  |  |  | — |  |  |  | 1,054 |  |  |  | 1,425 |
Employee notes receivable (3) |  |  | 434 |  |  |  | 224 |  |  |  | 112 |  |  |  | 158 |
Customer trust accounts and other |  |  | 1,609 |  |  |  | 2,367 |  |  |  | 212 |  |  |  | 175 |
|  | $ | 3,826 |  |  | $ | 5,136 |  |  | $ | 9,056 |  |  | $ | 9,116 |
(1) | Represents amounts advanced, notes receivable and other receivables due from the Company’s investment sales and financing professionals. The notes receivable along with interest, are typically collected from future commissions and are generally due in one to five years.
(2) | Includes allowance for doubtful accounts related to current receivables of $303 and $359 as of September 30, 2016 and December 31, 2015, respectively. The Company recorded a provision for bad debt expense of $12 and $48 and wrote off $6 and $24 of these receivables for the three months ended September 30, 2016 and 2015, respectively. The Company recorded a provision for bad debt expense of $15 and $127 and wrote off $71 and $59 of these receivables for the nine months ended September 30, 2016 and 2015, respectively.
(3) | See Note 6 – “Related-Party Transactions” for additional information.
Deferred Compensation and Commissions Deferred compensation and commissions consisted of the following (in thousands):
|  | Current |  |  | Non-Current |
|  | September 30, |  |  | December 31, |  |  | September 30, |  |  | December 31, |
|  | 2016 |  |  | 2015 |  |  | 2016 |  |  | 2015 |
SARs liability (1) |  | $ | 1,366 |  |  | $ | — |  |  | $ | 20,719 |  |  | $ | 21,399 |
Commissions payable to investment sales and financing professionals |  |  | 28,140 |  |  |  | 34,091 |  |  |  | 12,755 |  |  |  | 17,015 |
Deferred compensation liability (1) |  |  | 138 |  |  |  | — |  |  |  | 6,804 |  |  |  | 5,264 |
|  | $ | 29,644 |  |  | $ | 34,091 |  |  | $ | 40,278 |  |  | $ | 43,678 |
(1) | The SARs and deferred compensation liability become subject to payout as a result of a participant no longer being considered as an employee service provider. As a result of the retirement of certain participants, estimated amounts to be paid to the participants within the next 12 months has been classified as current.
SARs Liability Prior to the IPO, certain employees of the Company were granted stock appreciation rights (“SARs”) under a stock-based compensation program assumed by MMC. In connection with the IPO, the SARs agreements were revised, the MMC liability of $20.0 million for the SARs was frozen at March 31, 2013, and was transferred to MMI through a capital distribution. The SARs liability will be settled with each participant in ten annual installments in January of each year upon retirement or termination from service. Under the revised agreements, MMI is required to accrue interest on the outstanding balance beginning on January 1, 2014 at a rate based on the 10-year treasury note plus 2%. The rate resets annually. The rates at January 1, 2016 and 2015 were 4.273% and 4.173%, respectively. MMI recorded interest expense related to this liability of $229,000 and $214,000, for the three months ended September 30, 2016 and 2015, respectively and $686,000 and $642,000 for the nine months ended September 30, 2016 and 2015, respectively. Estimated payouts within the next twelve months for participants that have separated from service have been classified as current. Commissions Payable Certain investment sales professionals have the ability to earn additional commissions after meeting certain annual revenue thresholds. These commissions are recognized as cost of services in the period in which they are earned. The Company has the ability to defer payment of certain commissions, at its election, for up to three years. Commissions payable that are not expected to be paid within twelve months are classified as long-term. Deferred Compensation Liability A select group of management is eligible to participate in a Deferred Compensation Plan. The plan is a 409A plan and permits the participant to defer compensation up to limits as determined by the plan. Amounts are paid out generally when the participant is no longer a service provider; however, an in-service payout election is available to participants. Participants may elect to receive payouts as a lump sum or quarterly over a two to fifteen year period. The Company elected to fund the Deferred Compensation Plan through company owned variable life insurance policies. The Deferred Compensation Plan is managed by a third-party institutional fund manager, and the deferred compensation and investment earnings are held as a Company asset in a rabbi trust, which is recorded in assets held in rabbi trust in the accompanying condensed consolidated balance sheets. The assets in the trust are restricted unless the Company becomes insolvent, as defined in the Deferred Compensation Plan, in which case the trust assets are subject to the claims of MMI’s creditors. The Company may also, in its sole and absolute discretion, elect to withdraw at any time a portion of the trust assets by an amount by which the fair market value of the trust assets exceeds 110% of the aggregate deferred compensation liability represented by the participants’ accounts. Estimated payouts within the next twelve months for participants that have separated from service have been classified as current. The net change in the carrying value of the assets held in the rabbi trust and the net change in the carrying value of the deferred compensation liability, each exclusive of additional contributions, distributions and trust expenses consisted of the following (in thousands):
|  | Three Months Ended September 30, |  |  | Nine Months Ended September 30, |
|  | 2016 |  |  | 2015 |  |  | 2016 |  |  | 2015 |
Increase (decrease) in the carrying value of the assets held in the rabbi trust (1) |  | $ | 229 |  |  | $ | (351 | ) |  | $ | 413 |  |  | $ | (340 | )
Increase (decrease) in the carrying value of the deferred compensation obligation (2) |  | $ | 209 |  |  | $ | (307 | ) |  | $ | 397 |  |  | $ | (248 | )
(1) | Recorded in other income (expense), net in the condensed consolidated statements of net and comprehensive income.
(2) | Recorded in selling, general and administrative expense in the condensed consolidated statements of net and comprehensive income.

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