Segment Information

12 Months Ended

Dec. 31, 2012

Segment Information

Segment Information

4.SEGMENT INFORMATION

During the year ended December 31, 2012, Julie M. Howard was named our Chief Executive Officer (CEO). As CEO, Ms. Howard fills the role of chief operating decision maker (CODM). Under her direction, a strategic realignment of the firm’s practices occurred during the second quarter of 2012, establishing four new operating and reportable segments that each report to Lee A. Spirer, Executive Vice President and Global Business Leader. Our performance will be assessed and resources will be allocated by the CODM based on the following four reportable segments:

•Disputes, Investigations & Economics

•  Financial, Risk & Compliance Advisory

•Healthcare

•  Energy

The changes combine practices that serve comparable client types and address similar business issues and industry dynamics. The new segment reporting structure provides shareholders and other users of our financial statements with more useful information about several of our key growth businesses, particularly Energy and Healthcare. Finally, the segment realignment represents a shift in overall management of the practices to a global management model, positioning practice leaders to be accountable for the operations and performance of their teams across borders while leveraging local leadership to drive effectiveness.

			CURRENT
			Disputes, Investigations & Economics	Financial, Risk & Compliance Advisory	Healthcare	Energy
FORMER	North America	Dispute & Investigative Services	Disputes & Investigations Construction	Global Investigations & Compliance
		Business Consulting Services	Claims Management	Financial Services Valuation & Financial Risk Management Restructuring	Healthcare	Energy
		Economic Consulting	Economics
		International Consulting	Disputes & Investigations Construction Public Services	Financial Services		Energy

Our business is assessed and resources are allocated based on the following four reportable segments:

· The Disputes, Investigations & Economics segment provides accounting, financial and economic analysis, as well as discovery support, data management and analytics, on a wide range of legal and business issues including disputes, investigations and regulatory matters. The clients of this segment are principally companies, along with their in-house counsel and law firms, as well as accounting firms, corporate boards and government agencies.

· The Financial, Risk & Compliance Advisory segment provides strategic, operational, valuation, risk management, investigative and compliance consulting to clients in the highly regulated financial services industry, including major financial and insurance institutions. This segment also provides anti-corruption solutions and restructuring consulting to clients in a broad variety of industries.

· The Healthcare segment provides strategy consulting, revenue cycle management, performance improvement, program management, physician practice management and outsourcing, technology solutions to health systems, physician practice groups, health insurance providers, governmental agencies and life sciences companies.

· The Energy segment provides management advisory services to existing and prospective owners of energy supply and delivery assets which allows them to evaluate, plan, develop, and enhance the value of their investments within evolving market and regulatory structures. In addition, the segment provides energy efficiency and energy related market research services. Clients include utilities, independent power producers, financial entities, law firms, regulators, and energy equipment providers.

The following information includes segment revenues before reimbursements, segment total revenues and segment operating profit. Certain unallocated expense amounts related to specific reporting segments have been excluded from segment operating profit to be consistent with the information used by management to evaluate segment performance. Segment operating profit represents total revenues less costs of services excluding long-term compensation expense attributable to consultants. Long-term compensation expense attributable to consultants includes share-based compensation expense and compensation expense attributed to certain retention incentives (see Note 8 — Share-based Compensation Expense and Note 9 — Supplemental Consolidated Balance Sheet Information).

The information presented does not necessarily reflect the results of segment operations that would have occurred had the segments been stand-alone businesses. Prior period segment data has been recast to be consistent with the current presentation. 

Information on the segment operations has been summarized as follows (shown in thousands):

	For the Year Ended
	December 31,
	2012		2011		2010
Revenues before reimbursements:
Disputes, Investigations & Economics	$	340,036	$	338,965	$	344,548
Financial, Risk & Compliance Advisory		162,614		136,472		98,288
Healthcare		151,065		134,611		105,933
Energy		89,668		85,666		74,692
Total revenues before reimbursements	$	743,383	$	695,714	$	623,461
Total revenues:
Disputes, Investigations & Economics	$	364,426	$	370,850	$	379,846
Financial, Risk & Compliance Advisory		204,166		159,663		112,830
Healthcare		170,150		151,841		122,807
Energy		105,899		102,330		88,177
Total revenues	$	844,641	$	784,684	$	703,660
Segment operating profit:
Disputes, Investigations & Economics	$	123,288	$	122,672	$	118,459
Financial, Risk & Compliance Advisory		58,564		44,906		31,197
Healthcare		50,959		42,739		37,348
Energy		31,721		32,882		28,911
Total segment operating profit		264,532		243,199		215,915
Segment reconciliation to income before income tax expense:
Unallocated:
General and administrative expenses		141,155		130,415		121,685
Depreciation expense		14,986		13,303		14,457
Amortization expense		6,767		8,658		12,368
Other operating costs		1,645		-		6,407
Long-term compensation expense related to consultants (including share-based compensation)		16,121		14,530		10,977
Operating income		83,858		76,293		50,021
Interest and other expense, net		4,503		5,566		8,828
Income before income tax expense	$	79,355	$	70,727	$	41,193

Total assets allocated by segment include accounts receivable (net), certain retention related prepaid assets, intangible assets and goodwill. The remaining assets are unallocated. Allocated assets by segment were as follows (shown in thousands):

	December 31,		December 31,
	2012		2011
Disputes, Investigations & Economics	$	476,736	$	437,431
Financial, Risk & Compliance Advisory		99,202		92,337
Healthcare		175,430		159,450
Energy		102,458		96,639
Unallocated assets		100,624		89,344
Total assets	$	954,450	$	875,201

Geographic data

Total revenues and assets by geographic region were as follows (shown in thousands):

	For the Year Ended December 31,
		2012		2011
Total revenue:
United States	$	754,925	$	687,586
United Kingdom		76,890		78,825
Other		12,826		18,273
Total	$	844,641	$	784,684

Total assets:
United States	$	809,027	$	737,409
United Kingdom		114,149		104,989
Other		31,274		32,803
Total	$	954,450	$	875,201