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Section 1: 10-Q (10-Q)

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Table of Contents

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.  20549
FORM 10-Q
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2019
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from
 
 
 
to
 
Commission file number:
001-08529
399078363_imageleggmasona08.jpg
LEGG MASON, INC.
(Exact name of registrant as specified in its charter)
 
 
 
 
 
 
 
MD
 
52-1200960
(State or other jurisdiction of incorporation or organization)
 
(I.R.S. Employer Identification No.)
100 International Drive
Baltimore
,
MD
21202
(Address of principal executive offices)
Zip Code
 
 
(
410
)
539-0000
(Registrant's telephone number, including area code)
(Former name, former address and former fiscal year, if changed since last report)
 
Securities registered pursuant to Section 12(b) of the Act:
 
 
 
 
 
Title of each class
 
Trading Symbol
 
Name of each exchange on which registered
Common stock, $0.10 par value
 
LM
 
New York Stock Exchange
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes
 
No
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). 
Yes
 
No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer
 
Accelerated filer
Non-accelerated filer
 
Smaller reporting company
 
 
 
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes
 
No
As of August 1, 2019, there were 86,747,537 shares of the registrant's common stock outstanding.


Table of Contents

TABLE OF CONTENTS
 
 
Page
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 



Table of Contents

PART I.     FINANCIAL INFORMATION

Item 1.        Financial Information

LEGG MASON, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
(Unaudited)
 
 
June 30, 2019
 
March 31, 2019
ASSETS
 
 
 
 
Current Assets
 
 
 
 
Cash and cash equivalents
 
$
643,574

 
$
921,071

Cash and cash equivalents of consolidated investment vehicles
 
4,786

 
4,219

Restricted cash
 
22,201

 
21,213

Receivables:
 


 
 
Investment advisory and related fees
 
425,321

 
425,470

Other
 
42,103

 
57,107

Investment securities
 
385,768

 
377,129

Investment securities of consolidated investment vehicles
 
135,973

 
129,627

Other
 
84,636

 
82,131

Other current assets of consolidated investment vehicles
 
1,502

 
1,889

Total Current Assets
 
1,745,864

 
2,019,856

Fixed assets, net
 
147,865

 
149,989

Intangible assets, net
 
3,383,308

 
3,386,759

Goodwill
 
1,896,349

 
1,883,554

Deferred income taxes
 
194,814

 
199,717

Right-of-use assets
 
324,779

 

Other
 
144,547

 
145,254

Other assets of consolidated investment vehicles
 
8,315

 
8,993

TOTAL ASSETS
 
$
7,845,841

 
$
7,794,122

LIABILITIES AND STOCKHOLDERS’ EQUITY
 
 
 
 
LIABILITIES
 
 

 
 

Current Liabilities
 
 

 
 

Accrued compensation
 
$
270,678

 
$
571,301

Accounts payable and accrued expenses
 
174,025

 
182,921

Current portion of long-term debt
 
249,966

 
250,301

Lease liabilities
 
77,660

 

Other
 
87,198

 
99,479

Other current liabilities of consolidated investment vehicles
 
7,354

 
5,742

Total Current Liabilities
 
866,881

 
1,109,744

Deferred compensation
 
97,640

 
85,548

Lease liabilities
 
315,448

 

Deferred income taxes
 
136,767

 
123,420

Other (including unfunded pension benefit obligation of $29,413 and $33,335, respectively)
 
61,313

 
122,044

Long-term debt, net
 
1,971,772

 
1,971,451

TOTAL LIABILITIES
 
3,449,821

 
3,412,207

Commitments and Contingencies (Note 9)
 
 
 
 
REDEEMABLE NONCONTROLLING INTERESTS
 
664,757

 
692,376

STOCKHOLDERS' EQUITY
 
 

 
 
Common stock, par value $0.10; authorized 500,000,000 shares; issued 86,656,401 and 85,556,562 shares for June 30, 2019 and March 31, 2019, respectively
 
8,666

 
8,556

Additional paid-in capital
 
2,084,666

 
2,039,671

Employee stock trust
 
(20,239
)
 
(21,416
)
Deferred compensation employee stock trust
 
20,239

 
21,416

Retained earnings
 
1,748,106

 
1,742,764

Accumulated other comprehensive loss, net
 
(140,655
)
 
(131,236
)
Total stockholders' equity attributable to Legg Mason, Inc.
 
3,700,783

 
3,659,755

Nonredeemable noncontrolling interest
 
30,480

 
29,784

TOTAL STOCKHOLDERS' EQUITY
 
3,731,263

 
3,689,539

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
 
$
7,845,841

 
$
7,794,122

See Notes to Consolidated Financial Statements

3

Table of Contents

LEGG MASON, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share amounts)
(Unaudited)
 
 
Three Months Ended June 30,
 
 
2019
 
2018
OPERATING REVENUES
 
 
 
 
Investment advisory fees:
 
 
 
 
Separate accounts
 
$
260,441

 
$
259,895

Funds
 
366,812

 
383,564

Performance fees
 
6,861

 
24,036

Distribution and service fees
 
69,937

 
79,190

Other
 
1,309

 
1,220

Total Operating Revenues
 
705,360

 
747,905

OPERATING EXPENSES
 


 


Compensation and benefits
 
379,828

 
361,568

Distribution and servicing
 
103,906

 
116,592

Communications and technology
 
55,274

 
56,740

Occupancy
 
25,624

 
24,904

Amortization of intangible assets
 
5,457

 
6,180

Contingent consideration fair value adjustments
 
(1,165
)
 
426

Other
 
52,501

 
55,819

Total Operating Expenses
 
621,425


622,229

OPERATING INCOME
 
83,935

 
125,676

NON-OPERATING INCOME (EXPENSE)
 


 


Interest income
 
4,005

 
2,446

Interest expense
 
(28,483
)
 
(29,917
)
Other income (expense), net
 
10,599

 
7,252

Non-operating income (expense) of consolidated investment vehicles, net
 
9,561

 
3,583

Total Non-Operating Income (Expense)
 
(4,318
)
 
(16,636
)
INCOME BEFORE INCOME TAX PROVISION
 
79,617

 
109,040

Income tax provision
 
18,048

 
30,675

NET INCOME
 
61,569

 
78,365

Less: Net income attributable to noncontrolling interests
 
16,219

 
12,275

NET INCOME ATTRIBUTABLE TO LEGG MASON, INC.
 
$
45,350

 
$
66,090

NET INCOME PER SHARE ATTRIBUTABLE TO LEGG MASON, INC. STOCKHOLDERS:
 
 
 
 
Basic
 
$
0.51

 
$
0.75

Diluted
 
0.51

 
0.75

See Notes to Consolidated Financial Statements

4

Table of Contents

LEGG MASON, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(Dollars in thousands)
(Unaudited)
 
 
Three Months Ended June 30,
 
 
2019
 
2018
NET INCOME
 
$
61,569

 
$
78,365

Other comprehensive income (loss):
 
 
 
 
Foreign currency translation adjustment
 
(9,964
)
 
(53,362
)
Changes in defined benefit pension plan
 
545

 
882

Total other comprehensive income (loss)
 
(9,419
)

(52,480
)
COMPREHENSIVE INCOME
 
52,150


25,885

Less: Comprehensive income attributable to noncontrolling interests
 
17,057

 
14,884

COMPREHENSIVE INCOME ATTRIBUTABLE TO LEGG MASON, INC.
 
$
35,093


$
11,001

See Notes to Consolidated Financial Statements

5

Table of Contents

LEGG MASON, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
(Dollars in thousands)
(Unaudited)
 
Three Months Ended June 30,
 
 
2019
 
2018
STOCKHOLDERS' EQUITY ATTRIBUTABLE TO LEGG MASON, INC.
 
 
 
 
COMMON STOCK
 
 
 
 
Beginning balance
 
$
8,556

 
$
8,461

Stock options exercised
 
30

 
15

Stock-based compensation
 
118

 
107

Employee tax withholdings by settlement of net share transactions
 
(38
)
 
(39
)
Ending balance
 
8,666

 
8,544

ADDITIONAL PAID-IN CAPITAL
 
 
 
 

Beginning balance
 
2,039,671

 
1,976,364

Stock options exercised
 
9,406

 
4,801

Deferred compensation employee stock trust
 
163

 
136

Stock-based compensation
 
21,893

 
18,701

Employee tax withholdings by settlement of net share transactions
 
(12,543
)
 
(15,368
)
Redeemable noncontrolling interest reclassification for affiliate noncontrolling interest
 
26,076

 

Ending balance
 
2,084,666

 
1,984,634

EMPLOYEE STOCK TRUST
 
 
 
 

Beginning balance
 
(21,416
)
 
(21,996
)
Shares issued to plans
 
(163
)
 
(136
)
Distributions
 
1,340

 
180

Ending balance
 
(20,239
)
 
(21,952
)
DEFERRED COMPENSATION EMPLOYEE STOCK TRUST
 
 
 
 
Beginning balance
 
21,416

 
21,996

Shares issued to plans
 
163

 
136

Distributions
 
(1,340
)
 
(180
)
Ending balance
 
20,239

 
21,952

RETAINED EARNINGS
 
 
 
 
Beginning balance
 
1,742,764

 
1,894,762

Net income attributable to Legg Mason, Inc.
 
45,350

 
66,090

Dividends declared ($0.40 and $0.34 per share, respectively)
 
(37,627
)
 
(29,858
)
Reclassification to noncontrolling interest for net increase in estimated redemption value of affiliate management equity plan and affiliate noncontrolling interests
 
(2,381
)
 
(1,269
)
Adoption of new revenue recognition guidance
 

 
12,263

Ending balance
 
1,748,106

 
1,941,988

ACCUMULATED OTHER COMPREHENSIVE LOSS, NET
 
 
 
 

Beginning balance
 
(131,236
)
 
(55,182
)
Changes in defined benefit pension plan
 
545

 
882

Foreign currency translation adjustment
 
(9,964
)
 
(53,362
)
Ending balance
 
(140,655
)
 
(107,662
)
TOTAL STOCKHOLDERS’ EQUITY ATTRIBUTABLE TO LEGG MASON, INC.
 
3,700,783


3,827,504

NONREDEEMABLE NONCONTROLLING INTEREST
 
 
 
 
Beginning balance
 
29,784

 
27,731

Net income attributable to noncontrolling interests
 
2,863

 
2,214

Distributions
 
(2,167
)
 
(1,733
)
Ending balance
 
30,480

 
28,212

TOTAL STOCKHOLDERS’ EQUITY
 
$
3,731,263

 
$
3,855,716

See Notes to Consolidated Financial Statements

6

Table of Contents

LEGG MASON, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in thousands)
(Unaudited)
 
 
Three Months Ended June 30,
 
 
2019
 
2018
CASH FLOWS FROM OPERATING ACTIVITIES
 
 
 
 
Net Income
 
$
61,569

 
$
78,365

Adjustments to reconcile Net Income to net cash provided by operations:
 
 
 
 
Depreciation and amortization
 
16,496

 
17,547

Accretion and amortization of securities discounts and premiums, net
 
108

 
561

Stock-based compensation
 
23,834

 
19,085

Net unrealized gains on investments
 
(4,684
)
 
(350
)
Net gains and earnings on investments
 
(6,748
)
 
(6,792
)
Net gains of consolidated investment vehicles
 
(9,561
)
 
(3,583
)
Deferred income taxes
 
22,294

 
21,796

Contingent consideration fair value adjustments
 
(1,165
)
 
426

Other
 
345

 
371

Decrease (increase) in assets:
 
 
 
 
Investment advisory and related fees receivable
 
235

 
36,589

Net sales of trading and other investments
 
(4,817
)
 
(4,385
)
Other receivables
 
10,661

 
(4,473
)
Other assets
 
(5,294
)
 
(12,562
)
Assets of consolidated investment vehicles
 
11,400

 
(14,575
)
Increase (decrease) in liabilities:
 
 
 
 
Accrued compensation
 
(300,250
)
 
(213,181
)
Deferred compensation
 
12,084

 
8,837

Accounts payable and accrued expenses
 
(10,298
)
 
18,166

Other liabilities
 
(5,398
)
 
(44,007
)
Other liabilities of consolidated investment vehicles
 
1,612

 
(5
)
CASH USED IN OPERATING ACTIVITIES
 
$
(187,577
)
 
$
(102,170
)










7

Table of Contents

LEGG MASON, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
(Dollars in thousands)
(Unaudited)

 
 
Three Months Ended June 30,
 
 
2019
 
2018
CASH FLOWS FROM INVESTING ACTIVITIES
 
 
 
 
Business acquisition, net of cash acquired of $992
 
$
(10,247
)
 
$

Payments for fixed assets
 
(9,190
)
 
(17,990
)
Returns of capital and proceeds from sales and maturities of investments
 
488

 
3,679

CASH USED IN INVESTING ACTIVITIES
 
(18,949
)

(14,311
)
CASH FLOWS FROM FINANCING ACTIVITIES
 
 
 
 
Dividends paid
 
(30,131
)
 
(24,572
)
Distributions to affiliate noncontrolling interests
 
(16,230
)
 
(13,183
)
Purchase of affiliate noncontrolling interests
 
(10,548
)
 

Net (redemptions) subscriptions attributable to noncontrolling interests
 
(8,232
)

18,132

Employee tax withholdings by settlement of net share transactions
 
(12,581
)
 
(15,407
)
Issuances of common stock for stock-based compensation
 
9,599

 
4,952

CASH USED IN FINANCING ACTIVITIES
 
(68,123
)

(30,078
)
EFFECT OF EXCHANGE RATES
 
(2,697
)
 
(10,062
)
NET DECREASE IN CASH, CASH EQUIVALENTS, AND
       RESTRICTED CASH
 
(277,346
)
 
(156,621
)
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH:
 
 
 
 
BEGINNING OF PERIOD
 
950,795

 
773,765

END OF PERIOD
 
$
673,449


$
617,144

Supplemental Disclosures
 
 
 
 
Cash paid for:
 
 
 
 

Income taxes
 
$
4,776

 
$
13,269

Interest
 
11,081

 
12,135

Reconciliation of cash, cash equivalents and restricted cash
 
 
 
 
Cash and cash equivalents
 
$
643,574

 
$
590,530

Restricted cash:
 
 
 
 
Corporate restricted cash
 
22,201

 
19,004

Cash and cash equivalents of consolidated investment vehicles
 
4,786

 
3,466

Affiliate employee benefit trust cash included in Other non-current assets
 
2,888

 
4,144

Total cash, cash equivalents and restricted cash per consolidated statements of cash flows
 
$
673,449


$
617,144

See Notes to Consolidated Financial Statements

8

Table of Contents

LEGG MASON, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except per share amounts or unless otherwise noted)
June 30, 2019
(Unaudited)

1. Interim Basis of Reporting

The accompanying unaudited interim consolidated financial statements of Legg Mason, Inc. and its subsidiaries (collectively “Legg Mason”) have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and the applicable rules and regulations of the Securities and Exchange Commission (the "SEC"). The interim consolidated financial statements have been prepared using the interim basis of reporting and, as such, reflect all adjustments (consisting only of normal recurring adjustments) which are, in the opinion of management, necessary for a fair statement of the results for the periods presented. The preparation of interim consolidated financial statements requires management to make assumptions and estimates that affect the amounts reported in the interim consolidated financial statements and accompanying notes. Actual amounts could differ from those estimates and the differences could have a material impact on the interim consolidated financial statements. Terms such as “we,” “us,” “our,” and “Company” refer to Legg Mason.

The nature of Legg Mason's business is such that the results of any interim period are not necessarily indicative of the results of a full year. Certain disclosures included in the Company's annual report are not required to be included on an interim basis in the Company's Quarterly Reports on Form 10-Q. The Company has condensed or omitted these disclosures. Certain amounts in prior period financial statements have been reclassified to conform to the current period presentation.

The information contained in the interim consolidated financial statements should be read in conjunction with the consolidated financial statements contained within Legg Mason's latest Annual Report on Form 10-K filed with the SEC.

2. Significant Accounting Policies

Leases
Effective April 1, 2019 Legg Mason adopted updated accounting guidance on leases which requires right-of-use ("ROU") assets and lease liabilities to be recorded on the balance sheet for leases. The guidance specifies that at the inception of a contract, an entity must determine whether the contract is or contains a lease. The contract is or contains a lease if the contract conveys the right to control the use of the property, plant, or equipment for a designated term in exchange for consideration. Legg Mason’s evaluation of its contracts followed the assessment of whether there was a right to obtain substantially all of the economic benefits from the use and the right to direct the use of the identified asset in the contract.
Legg Mason adopted the guidance on a modified retrospective basis as of April 1, 2019, such that related amounts in prior periods have not been restated. Legg Mason has operating leases that primarily relate to real property and financing leases that relate to equipment. As a practical expedient, Legg Mason has elected to not capitalize leases with a term of 12 months or less without a purchase option that it is likely to exercise. Also as a practical expedient for disclosure, Legg Mason has elected to not separate lease and non-lease components on operating and financing leases. Lease components are payment items directly attributable to the use of the underlying asset, while non-lease components are explicit elements of a contract not directly related to the use of the underlying asset, including pass through operating expenses like common area maintenance and utilities.
ROU assets and lease liabilities are recognized on the consolidated balance sheet at the present value of the future lease payments over the life of the lease term. As implicit rates for leases are not determinable, the Company uses discount rates based on incremental borrowing rates, on a collateralized basis, for the respective underlying assets, for terms similar to the respective leases. Lease costs are included as Occupancy expense in the Consolidated Statements of Income. Fixed base payments on operating leases paid directly to the lessor are recorded as lease expense on a straight-line basis. Related variable payments based on usage, changes in an index or market rate are expensed as incurred. Payments on financing leases are recorded as lease expense on a level-yield basis.
Upon adoption, Legg Mason recorded ROU assets of $342,418 and lease liabilities of $411,115 related to its real property operating leases and equipment financing leases. As further discussed in Note 8, Legg Mason has subleased or has vacated and is pursuing subleases for certain office space. As of March 31, 2019, the lease reserve liability for subleased space and

9

Table of Contents

vacated space for which subleases are being pursued of $24,063 was included in other current and non-current liabilities on the Consolidated Balance Sheet under prior accounting guidance. Upon adoption of the updated guidance, the existing lease reserve liability was reclassified as a reduction of the ROU assets. ROU assets will be tested for impairment when circumstances indicate that the carrying values may not be recoverable.
The adoption of this guidance did not require a cumulative effect adjustment or have a material impact on the Consolidated Statements of Income or Consolidated Statements of Cash Flows.
See Note 8 for additional information.
Recent Accounting Developments
In August 2018, the Financial Accounting Standards Board ("FASB") updated the guidance to clarify accounting for implementation costs incurred for a cloud computing arrangement that is a service contract. The update conforms the requirements for capitalizing implementation costs incurred in a cloud computing arrangement that is a service contract with the accounting guidance that provides for capitalization of costs incurred to develop or obtain internal-use-software.  The updated guidance is effective for Legg Mason in fiscal 2021, unless adopted earlier.  Legg Mason is evaluating its adoption.

In August 2018, the FASB also updated the guidance for fair value measurements. The updated guidance modifies disclosure requirements based on the revised FASB Conceptual Framework for Financial Reporting finalized in August 2018 to improve effectiveness of financial statement disclosures. The updated guidance will be effective in fiscal 2021, unless adopted earlier. Legg Mason is evaluating its adoption.



10

Table of Contents

3. Investments and Fair Value of Assets and Liabilities

The disclosures below include details of Legg Mason's financial assets and financial liabilities that are measured at fair value and net asset value ("NAV"), excluding the financial assets and financial liabilities of consolidated investment vehicles ("CIVs"). See Note 16, Variable Interest Entities and Consolidation of Investment Vehicles, for information related to the assets and liabilities of CIVs that are measured at fair value.

The fair values of financial assets and (liabilities) of the Company were determined using the following categories of inputs:
 
 
As of June 30, 2019
 
 
Quoted prices in active markets
(Level 1)
 
Significant other observable inputs
(Level 2)
 
Significant unobservable inputs
(Level 3)
 
Investments measured at NAV
 
Total
Assets:
 
 
 
 
 
 
 
 
 
 
Cash equivalents(1)
 
$
352,645

 
$
13,598

 
$

 
$

 
$
366,243

Equity investments:(2)
 
 
 
 
 
 
 
 
 
 
Seed capital investments
 
84,293

 
31,967

 

 
2,169

 
118,429

Investments related to long-term incentive plans
 
241,766

 

 

 

 
241,766

Other investments
 
13,009

 
2,098

 

 

 
15,107

Equity method investments:(3)
 
 
 
 
 
 
 
 
 


Seed capital investments(4)
 

 

 
42,516

 
11,012

 
53,528

Investments related to long-term incentive plans(2)
 

 

 

 
10,466

 
10,466

Other investments(4)
 

 

 
1,222

 
10,414

 
11,636

Adjusted cost investments(4)
 

 
70

 
12,124

 

 
12,194

Derivative assets(5)
 
3,221

 

 

 

 
3,221

Total
 
$
694,934

 
$
47,733

 
$
55,862

 
$
34,061

 
$
832,590

Liabilities:
 
 
 
 
 
 
 
 
 
 
Contingent consideration liabilities(6)
 
$

 
$

 
$
(3,625
)
 
$

 
$
(3,625
)
Derivative liabilities(5)
 
(2,848
)
 

 

 

 
(2,848
)
Total
 
$
(2,848
)
 
$

 
$
(3,625
)
 
$

 
$
(6,473
)

11

Table of Contents

 
 
As of March 31, 2019
 
 
Quoted prices in active markets
(Level 1)
 
Significant other observable inputs
(Level 2)
 
Significant unobservable inputs
(Level 3)
 
Investments measured at NAV
 
Total
Assets:
 
 
 
 
 
 
 
 
 
 
Cash equivalents(1)
 
$
556,231

 
$
20,160

 
$

 
$

 
$
576,391

Equity investments:(2)
 
 
 
 
 
 
 
 
 
 
Seed capital investments
 
98,276

 
30,601

 
1,455

 
2,183

 
132,515

Investments related to long-term incentive plans
 
211,802

 

 

 


 
211,802

Other investments
 
19,486

 
2,142

 

 

 
21,628

Equity method investments:(3)
 
 
 
 
 


 


 


Seed capital investments(4)
 

 

 
40,854

 
10,675

 
51,529

Investments related to long-term incentive plans(2)
 

 

 

 
11,184

 
11,184

Other investments(4)
 

 

 
1,218

 
10,251

 
11,469

Adjusted cost investments(4)
 

 
74

 
12,171

 

 
12,245

Derivative assets(5)
 
4,183

 

 

 

 
4,183

Total
 
$
889,978

 
$
52,977

 
$
55,698

 
$
34,293

 
$
1,032,946

Liabilities:
 
 
 
 
 
 
 
 
 
 
Contingent consideration liabilities(6)
 
$

 
$

 
$
(1,415
)
 
$

 
$
(1,415
)
Derivative liabilities(5)
 
(7,579
)