Quarterly report pursuant to Section 13 or 15(d)

Fair Value Measurements

v3.22.2
Fair Value Measurements
 6 Months Ended
Jun. 30, 2022
Fair Value Disclosures [Abstract]  
Fair Value Measurements FAIR VALUE MEASUREMENTS
Exchange traded funds: Valued using the market price of the fund as of the consolidated balance sheet dates, June 30, 2022 and December 31, 2021. Exchange traded funds valued using quoted prices are classified within Level 1 of the fair value hierarchy.
Mutual funds: Valued at the number of shares of the underlying fund multiplied by the closing NAV per share quoted by that fund as of the consolidated balance sheet dates, June 30, 2022 and December 31, 2021. The value of the specific funds the Company has invested in are validated with a sufficient level of observable activity to support classification of the fair value measurement as Level 1 in the fair value hierarchy.
Accrued performance allocations and partnership interests: The Company generally values its investments in accrued performance allocations and partnership interests using the NAV per share equivalent calculated by the investment manager as a practical expedient to determining an fair value. The Company does not categorize within the fair value hierarchy investments where fair value is measured using the NAV per share practical expedient.
Other investments: Investments are accounted for using the measurement alternative to measure at cost adjusted for any impairment and observable price changes. Unrealized gains or losses on other investments are included in investment income (loss) on the consolidated and combined statements of operations.
General Partner notes payable: Valued using the NAV per share equivalent calculated by the investment manager as a practical expedient to determining an independent fair value.
The preceding methods described may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. Furthermore, although the Company believes its valuation methods are appropriate
and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date.
The following table presents assets that are measured at fair value on a recurring basis as of June 30, 2022 and December 31, 2021 (in thousands):
Level 1 Level 2 Level 3 Measured at
NAV		 Total
June 30, 2022
Assets:
Exchange traded funds $ 1,582  $ —  $ —  $ —  $ 1,582 
Mutual funds 9,195  —  —  —  9,195 
Accrued performance allocations —  —  —  575,527  575,527 
Partnership interests —  —  —  66,885  66,885 
Other investments —  —  6,510  —  6,510 
Total assets at fair value $ 10,777  $ —  $ 6,510  $ 642,412  $ 659,699 
Liabilities:
General Partner notes payable $ —  $ —  $ —  $ 12,364  $ 12,364 
December 31, 2021
Assets:
Exchange traded funds $ 1,171  $ —  $ —  $ —  $ 1,171 
Mutual funds 6,864  —  —  —  6,864 
Accrued performance allocations —  —  —  439,548  439,548 
Partnership interests —  —  —  39,685  39,685 
Other investments —  —  4,321  —  4,321 
Total assets at fair value $ 8,035  $ —  $ 4,321  $ 479,233  $ 491,589 
Liabilities:
General Partner notes payable $ —  $ —  $ —  $ 12,003  $ 12,003 
The following table presents a rollforward of Level 3 assets at cost adjusted for any impairment and observable price changes (in thousands):
Other
Investments
Balance as of December 31, 2021 $ 4,321 
Purchases 2,189 
Balance as of June 30, 2022 $ 6,510 
Accrued carried interest allocations, investments in funds, and investments in limited partnership interests in third-party private funds are valued using NAV of the respective vehicle. The following table presents investments carried at fair value using NAV (in thousands):
Fair Value Unfunded
Commitments
June 30, 2022:
Accrued performance allocations $ 575,527  $ — 
Partnership interests:
Company-sponsored open-end fund 19,444  — 
Company-sponsored closed-end funds 36,061  3,291 
Third-party closed-end funds 11,380  6,302 
Total partnership interests $ 66,885  $ 9,593 
 
December 31, 2021:
Accrued performance allocations $ 439,548  $ — 
Partnership interests:
Company-sponsored open-end fund 15,474  — 
Company-sponsored closed-end funds 16,510  20,885 
Third-party closed-end funds 7,701  2,436 
Total partnership interests $ 39,685  $ 23,321 
The Company can redeem its investment in the Company-sponsored open-end fund with a 60-day notice. The Company’s interests in its closed-end funds are not subject to redemption, with distributions to be received through liquidation of underlying investments of the funds. The closed-end funds generally have eight-to-ten year terms, which may be extended in certain circumstances.
Fair Value Information of Financial Instruments Reported at Cost
The carrying values of cash, accounts receivable, due from and to affiliates, interest payable and accounts payable approximate fair value due to their short-term nature and negligible credit risk. The following table presents the carrying amounts and estimated fair values of financial instruments reported at amortized cost (in thousands):
Level 1 Level 2 Level 3 Total Carrying
Value
As of June 30, 2022:
Notes payable (private notes) $ —  $ —  $ 135,004  $ 135,004  $ 150,000 
As of December 31, 2021:
Notes payable (private notes) $ —  $ —  $ 144,577  $ 144,577  $ 150,000 
Fair values of the private notes were estimated by discounting expected future cash outlays at interest rates available to the Company for similar instruments.