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Note 30 - Supplemental Cash Flow Disclosure

12 Months Ended

Dec. 31, 2021

Notes to Financial Statements

Cash Flow, Supplemental Disclosures [Text Block]

30. SUPPLEMENTAL CASH FLOW DISCLOSURE 

 

Interest paid by the Company on its debt and redeemable financial instruments was $6,388, $8,711 and $7,265 for the years ended December 31, 2021, 2020, and 2019, respectively.    

 

The Company paid income taxes of $166, $234, and $30 for the years ended December 31, 2021, 2020, and 2019, respectively, and received income tax refunds of  $96, $82, and $48 for the years ended December 31, 2021, 2020, and 2019, respectively. 

In 2021, the Company had the following significant non-cash transactions that are not reflected on the statement of cash flows:

	•	The Company net surrendered units of membership interests in the Operating LLC.  The Company recognized a net decrease  in additional paid-in capital of $1,929, a net decrease of $10 in AOCI, and an increase of $1,939  in non-controlling interest.  See note 21.
	•	The Company recorded a decrease of $2,103 in due from related party, a corresponding increase of $701 in other investments at fair value, and a corresponding decrease of $1,402 to non-controlling interest, all as a result of an in-kind distribution of incremental LP interests, from the 2020 performance fee earned, to all the members of Vellar GP, including the Company.
	•	The Company recorded a decrease of $3,958 in investments in equity method affiliates and a $31,049 decrease in other investments, at fair value and a corresponding decrease in non-controlling interest resulting from an in-kind distribution from Insurance SPAC II.
	•	The Company recorded a decrease in other investments at fair value of $20,119 and a corresponding decrease in non-controlling interest resulting from an in-kind distribution from Insurance SPAC.
	•	The Company recorded a net decrease in investments in equity method affiliates of $5,439 and a net increase in other investments at fair value of $5,439 resulting from an in-kind distribution from an equity method affiliate.
	•	The Company recorded a decrease in other investments at fair value of $2,415 and a decrease in non-controlling interest of $2,415 resulting from an in-kind distribution from other consolidated subsidiaries.

  

In 2020, the Company had the following significant non-cash transactions that are not reflected on the statement of cash flows:

	•	The Company net surrendered units of the Operating LLC.  The Company recognized a net decrease in additional paid-in capital of $1,765, a net increase of $59 in accumulated other comprehensive income, and an increase of $1,706 in non-controlling interest.  See note 21.
	•	In conjunction with the sale of ViaNova on August 22, 2020, the Company transferred one RTL with a fair value of $2,243 to JVB.  As a result, the Company recorded an increase in other investments at fair value and corresponding decrease in other assets.  See note 20.
	•	The Company recorded a $9,694 decrease to other investments, at fair value resulting from noncontrolling interest in-kind distributions.

  

In 2019, the Company had the following significant non-cash transactions that are not reflected on the statement of cash flows:

	•	On January 1, 2019, the Company recorded a right of use asset of $8,416 and a right of use liability of $8,860, a reduction in retained earnings from cumulative effect of adoption of $20, an increase in other receivables of $18, and a reduction in other liabilities of $406, resulting from the adoption of ASU 2016-02. See note 3.
	•	On December 30, 2019, the Company recorded a $7,779 increase to other investments, at fair value resulting from the contribution of IMXI securities from Daniel G. Cohen and the DGC Trust in exchange for the issuance of 22,429,541 newly issued units of membership interests in the Operating LLC and the issuance of 22,429,541 shares of Series F Preferred Stock.  This also resulted in an increase of $7,779 in non-controlling interest.  See notes 21, and 31.

As part of the Company's matched book repo operations, the Company enters into reverse repos with counterparties whereby it lends money and receives securities as collateral.  In accordance with  FASB ASC 860, the collateral securities are not recorded in the Company's consolidated balance sheets.  However, from time to time the Company will hold cash instead of securities as collateral for these transactions.  When the Company is provided cash as collateral for reverse repo transactions, the Company will make an entry to increase its cash and cash equivalents and to increase its other liabilities for the amount of cash received.  There are two main reasons the Company  may receive collateral in the form of cash as opposed to securities.  First, when the value of the collateral securities the Company has in its possession declines, the Company will require the counterparty to provide it with additional collateral.  The Company will accept either cash or additional liquid securities.  Often, the Company's counterparties will provide it with cash as they may not have liquid securities readily available.  Second, from time to time, the Company's counterparties require a portion of the collateral securities in the Company's possession returned to them for operating purposes.  In such instances, the counterparty may not have substitute liquid securities available and will often provide the Company with cash as collateral instead.  It is important to note that when the Company receives cash as collateral, it is temporary in nature and the Company has an obligation to return that cash when the counterparty provides substitute liquid securities as collateral or otherwise satisfies their associated reverse repo obligation.  The Company is generally required to return any cash collateral the same business day that it receives substitute securities.  See note 11. 

The Company has no legal or contractual obligation to segregate this cash collateral held and therefore it is included as a component of its cash and cash equivalents in the Company's consolidated balance sheets.  However, it is not available for use in the Company's general operations as the Company must stand ready at all times to return the collateral held immediately once the reverse repo counterparty provides substitute liquid securities or the repo matures. 

The following table illustrates the impact of changing collateral deposits had on cash from operations:

		Year Ended December 31,
		2021				2020				2019
Collateral deposit end of period		$	17,320			$	41,119			$	9,524
Less: Collateral deposit beginning of period			41,119				9,524				4,277
Impact to cash flow from operations		$	(23,799	)		$	31,595			$	5,247

X

- Definition

The entire disclosure for supplemental cash flow activities, including cash, noncash, and part noncash transactions, for the period. Noncash is defined as information about all investing and financing activities of an enterprise during a period that affect recognized assets or liabilities but that do not result in cash receipts or cash payments in the period. "Part noncash" refers to that portion of the transaction not resulting in cash receipts or cash payments in the period.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 230
-URI http://asc.fasb.org/topic&trid=2134446

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