XML 25 R14.htm IDEA: XBRL DOCUMENT

Fair Value

9 Months Ended

Sep. 30, 2021

4. Fair Value

All of the instruments within cash and cash equivalents and investments in securities are measured at fair value, except for those investments designated as held-to-maturity. The Company’s assets and liabilities recorded at fair value have been categorized based upon a fair value hierarchy in accordance with the FASB Accounting Standards Codification (“ASC”) Topic 820, Fair Value Measurement (“ASC 820”), guidance on fair value measurement. The levels of the fair value hierarchy and their applicability to the Company are described below:

-	Level 1 - the valuation methodology utilizes quoted prices (unadjusted) in active markets for identical assets or liabilities at the reporting date. Level 1 assets include cash equivalents, government obligations, mutual funds, closed-end funds, and listed equities.
-	Level 2 - the valuation methodology utilizes inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities that are not active, and inputs other than quoted prices that are observable for the asset or liability, such as interest rates and yield curves that are observable at commonly-quoted intervals.
-	Level 3 - the valuation methodology utilizes unobservable inputs for the asset or liability, and includes situations where there is little, if any, market activity for the asset or liability.

The following tables summarize the Company’s assets and liabilities measured at fair value on a recurring basis by the above fair value hierarchy levels as of September 30, 2021 and December 31, 2020 (in thousands):

Assets and liabilities measured at fair value on a recurring basis as of September 30, 2021

Assets	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Balance as of September 30, 2021
Cash equivalents	$	152,243	$	-	$	-	$	152,243
Investments in securities:
Common stocks		17,687		-		-		17,687
Open-end Funds		6,018		-		-		6,018
Actively managed semi-transparent ETFs		5,320		-		-		5,320
Closed-end Funds		529		-		-		529
Other		7		-		-		7
Total investments in securities		29,561		-		-		29,561
Total assets at fair value	$	181,804	$	-	$	-	$	181,804

Assets and liabilities measured at fair value on a recurring basis as of December 31, 2020

Assets	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Balance as of December 31, 2020
Cash equivalents	$	32,661	$	-	$	-	$	32,661
Investments in securities:
Common stocks		19,099		-		-		19,099
Open-end Funds		6,128		-		-		6,128
Closed-end Funds		618		-		-		618
Total investments in securities		25,845		-		-		25,845
Total assets at fair value	$	58,506	$	-	$	-	$	58,506
Liabilities
Securities sold, not yet purchased:
Trading - Common stocks	$	799	$	-	$	-	$	799
Total securities sold, not yet purchased	$	799	$	-	$	-	$	799

Cash equivalents are comprised primarily of U.S. Treasury Bills and our money market fund which invests in U.S. Treasury Bills.

Financial assets not carried at fair value

The following table presents the carrying value and fair value of the Company’s investments in debt securities that are held-to-maturity and consisted of the following as of September 30, 2021 and December 31, 2020 (in thousands):

	September 30, 2021						December 31, 2020
	Carrying Value			Fair Value Level 1			Carrying Value			Fair Value Level 1
U.S. Treasury Bills		$	-		$	-		$	64,988		$	64,994
Total		$	-		$	-		$	64,988		$	64,994

At September 30, 2021 and December 31, 2020, the Senior Notes and Subordinated Notes were recorded at face value, net of amortized issuance costs, as follows (in thousands) on the Condensed Consolidated Statements of Financial Condition:

	September 30, 2021						December 31, 2020
	Carrying Value			Fair Value Level 2			Carrying Value			Fair Value Level 2
5.875% Senior Notes		$	-		$	-		$	24,215		$	24,554
Subordinated Notes			52,102			52,102			-			-
Total		$	52,102		$	52,102		$	24,215		$	24,554

The carrying value of other financial assets and liabilities approximates their fair value based on the short-term nature of these items.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details