Current Expected Credit Losses (CECL)

12 Months Ended

Dec. 31, 2022

Credit Loss [Abstract]

Current Expected Credit Losses (CECL)

Current Expected Credit Losses (CECL)

The CECL reserve reflects management’s current estimate of potential credit losses related to the receivable balances included in the Company’s Consolidated Statements of Financial Condition. See Note 3—“Summary of Significant Accounting Policies” for further discussion of the CECL reserve methodology.

As required, any subsequent changes to the CECL reserve are recognized in “Net income (loss) available to common stockholders” in the Company’s Consolidated Statements of Operations. During the years ended December 31, 2022, 2021 and 2020, the Company recorded changes in the CECL reserve as follows (in millions):

	Accrued commissions and other receivables, net		Loans, forgivable loans and other receivables from employees and partners, net		Receivables from broker-dealers, clearing organizations, customers and related broker-dealers		Total
Beginning balance, January 1, 2020	$	0.8	$	1.1	$	—	$	1.9
Current-period provision for expected credit losses	0.2		0.5		—		0.7
Ending balance, December 31, 2020	1.0		1.6		—		2.6
Current-period provision for expected credit losses	(0.3)		0.1		—		(0.2)
Ending balance, December 31, 2021	0.7		1.7		—		2.4
Current-period provision for expected credit losses	4.7		0.8		7.0		12.5
Ending balance, December 31, 2022	$	5.4	$	2.5	$	7.0	$	14.9

For the year ended December 31, 2022, there was an increase of $4.7 million in the CECL reserve against “Accrued commissions and other receivables, net” due to the updated macroeconomic assumptions resulting from a decrease in the GDP growth rate, which included a $4.5 million reserve related to Russia's Invasion of Ukraine, bringing the CECL reserve recorded pertaining to “Accrued commissions and other receivables, net” to $5.4 million as of December 31, 2022. For the years ended December 31, 2021 and 2020, there was a decrease of $0.3 million and an increase of $0.2 million, respectively, in the CECL reserve against “Accrued commissions and other receivables, net.”

For the years ended December 31, 2022, 2021, and 2020, there were increases of $0.8 million, $0.1 million, and $0.5 million, respectively, in the CECL reserve pertaining to "Loans, forgivable loans and other receivables from employees and partners, net" as a result of employee terminations, bringing the CECL reserve recorded pertaining to “Loans, forgivable loans and other receivables from employees and partners, net” to $2.5 million as of December 31, 2022.

For the year ended December 31, 2022, there was an increase of $7.0 million in the CECL reserve against “Receivables from broker-dealers, clearing organizations, customers and related broker-dealers” which reflected the downward credit rating migration of certain unsettled trades related to Russia's Invasion of Ukraine, bringing the CECL reserve recorded pertaining to “Receivables from broker-dealers, clearing organizations, customers and related broker-dealers” to $7.0 million as of December 31, 2022. There was no change in the CECL reserve recorded pertaining to “Receivables from broker-dealers, clearing organizations, customers and related broker-dealers” for the years ended December 31, 2021 and 2020.