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ORGANIZATION AND NATURE OF BUSINESS OPERATIONS | 9 Months Ended
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Sep. 30, 2024
Accounting Policies [Abstract] |
ORGANIZATION AND NATURE OF BUSINESS OPERATIONS | ORGANIZATION AND NATURE OF BUSINESS OPERATIONS B. Riley Financial, Inc. and its subsidiaries (collectively, the “Company”) provide investment banking, brokerage, wealth management, asset management, direct lending, business advisory, valuation, and asset disposition services to a broad client base spanning public and private companies, financial sponsors, investors, financial institutions, legal and professional services firms, and individuals. The Company also has a portfolio of communication related businesses that provide consumer Internet access and cloud communication services and owns Tiger US Holdings Inc. (“Targus”), which designs and sells laptop and computer accessories. The Company operates in five reportable operating segments: (i) Capital Markets, through which the Company provides investment banking, corporate finance, securities lending, restructuring, research, sales and trading services to corporate and institutional clients; (ii) Wealth Management, through which the Company provides wealth management and tax services to corporate and high-net-worth clients; (iii) Financial Consulting, through which the Company provides bankruptcy, financial advisory, and forensic accounting services; (iv) Communications, through which the Company provides consumer Internet access and related subscription services, cloud communication services, and mobile phone voice, text, and data services and devices; and (v) Consumer Products, which generates revenue through sales of laptop and computer accessories. During the quarter ended September 30, 2024, management concluded that certain businesses met the requirements to be classified as held for sale and discontinued operations. The financial results of these businesses whose disposal represent a strategic shift that has, or will have, a major effect on our operations and the financial results are reported as discontinued operations in the accompanying condensed statements of operations, and the assets and liabilities are reflected as amounts held for sale in the accompanying condensed balance sheets. Certain prior-year amounts have also been reclassified to conform to the current-year’s presentation as a result of discontinued operations. The Company's reporting segments have also been changed for the effects of the discontinued operations. For more information, see Note 16. Net (loss) income per share amounts are computed independently for net (loss) income from continuing operations, net (loss) income from discontinued operations and net loss. As a result, the sum of per-share amounts may not equal the total. Unless otherwise indicated, information in these notes to consolidated financial statements relates to continuing operations. Liquidity On February 29, 2024, the Company announced that an independent financial advisor was engaged to assist in the review of strategic alternatives for the Appraisal and Valuation Services, and Retail, Wholesale & Industrial Solutions businesses (collectively formerly known as “Great American Group”), which could include a potential sale or other transaction. As part of this process, the Company anticipated that proceeds may be used in a variety of ways including, among other things, de-levering our balance sheet. A solicitation process for the strategic review began in April 2024. For the nine months ended September 30, 2024, the Company incurred a net loss of $(769,333) which includes fair value adjustments totaling $(509,761) related to the Company’s equity investment in Freedom VCM Holdings, LLC (“Freedom”) and the loan to Vintage Capital Management, LLC which are included in the asset collateral pool securing the Company’s credit facility with Nomura Corporate Funding Americas, LLC (“Nomura”). As more fully described in Note 11 – Terms Loans and Revolving Credit Facility, the Company entered into a loan amendment in September 2024 to the credit facility with Nomura Corporate Funding Americas, LLC, which requires the Company to reduce the principal amount of the term loan to be no greater than $100,000 on or prior to September 30, 2025. In conjunction with the amendment, the Company made a principal payment of $85,146 thereby reducing the outstanding principal balance on the credit facility from $469,750 to $388,127 at September 30, 2024. After amending the credit facility, the strategic review process continued and in October 2024, the Company entered into a secured financing transaction for it’s brand operations and brand’s equity investments receiving proceeds of $189,331, see Note 22 Subsequent Events. From these proceeds, the Company repaid $171,480 on the Nomura credit facility reducing the outstanding principal balance from $388,127 to $216,647. In November 2024, the Company also entered into a transaction whereby all of its interests in the Great American Group businesses was contributed to a newly formed subsidiary and issued preferred and common units to an investor for a purchase price of approximately $203,000 (the “Great American Group Transaction”), see Note 22 – Subsequent Events. In connection with such transaction, the Company used proceeds to further reduce the outstanding balance on the Nomura credit facility from $216,647 to $125,000. The Company has $145,302 of 6.375% Senior Notes due on February 28, 2025 that mature and will use cash on hand to repay these senior notes. The Company believes that the current cash and cash equivalents, securities and other investments owned, funds available under our credit facilities, and cash expected to be generated from operating activities will be sufficient to meet our working capital and capital expenditure requirements for at least the next 12 months from issuance date of the accompanying financial statements. The Company has $217,440 of Senior Notes that are due to mature on March 31, 2026, as more fully discussed in Note 12. The Company is considering a number of additional strategic alternatives to satisfy this obligation; which among other things, includes: existing cash on hand; the sale of a portion of the Company’s traditional (W-2) Wealth Management business (as more further discussed in Note 22); the sale of non-core businesses; and the sale or refinancing of other assets and investments. There can be no assurance that these contemplated transactions will occur and in the event these transactions are not completed it could have a material impact on the Company’s financial condition.

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- Definition The entire disclosure for the nature of an entity's business, major products or services, principal markets including location, and the relative importance of its operations in each business and the basis for the determination, including but not limited to, assets, revenues, or earnings. For an entity that has not commenced principal operations, disclosures about the risks and uncertainties related to the activities in which the entity is currently engaged and an understanding of what those activities are being directed toward. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Name Accounting Standards Codification -Topic 275 -Publisher FASB -URI https://asc.fasb.org/275/tableOfContent Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -SubTopic 10 -Topic 275 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482861/275-10-50-1 + Details
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