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CONSOLIDATION (Tables)

3 Months Ended

Mar. 31, 2022

Condensed Financial Information Disclosure [Abstract]

The Company's interests in consolidated and non-consolidated VIEs, as presented in the Condensed Consolidated Statements of Financial Condition, and its respective maximum exposure to loss relating to non-consolidated VIEs are as follows:


	As of March 31,		As of December 31,

	2022		2021
Maximum exposure to loss attributable to the Company's investment in non-consolidated VIEs(1)	$	362,552	$	353,768
Maximum exposure to loss attributable to the Company's investment in consolidated VIEs(1)	601,252		583,192
Assets of consolidated VIEs	12,495,278		13,197,321
Liabilities of consolidated VIEs	11,221,527		12,018,655

(1)As of March 31, 2022 and December 31, 2021, the Company's maximum exposure of loss for CLO securities was equal to the cumulative fair value of our capital interest in CLOs that are managed and totaled $101.3 million and $103.8 million, respectively.


	Three months ended March 31,
		2022		2021
Net income attributable to non-controlling interests related to consolidated VIEs		$	38,462	$	27,816

Schedule of Consolidating Effects of the Consolidated Funds on the Company's Financial Condition

The following supplemental financial information illustrates the consolidating effects of the Consolidated Funds on the Company's financial condition, results from operations and cash flows:


	As of March 31, 2022
	Consolidated Company Entities		Consolidated Funds		Eliminations		Consolidated
Assets
Cash and cash equivalents	$	346,042	$	—	$	—	$	346,042
Investments (includes $3,137,561 of accrued carried interest)	4,458,910		—		(597,075)		3,861,835
Due from affiliates	529,720		—		(35,202)		494,518
Other assets	289,238		—		(3,402)		285,836
Goodwill	1,000,289		—		—		1,000,289
Intangible assets, net	1,490,591		—		—		1,490,591
Right-of-use operating lease assets	161,088		—		—		161,088
Assets of Consolidated Funds
Cash and cash equivalents	—		483,210		—		483,210
U.S. Treasury securities, at fair value	—		1,000,615		—		1,000,615
Investments, at fair value	—		11,656,848		4,719		11,661,567
Due from affiliates	—		11,646		(10,521)		1,125
Receivable for securities sold	—		304,282		—		304,282
Other assets	—		40,205		—		40,205
Total assets	$	8,275,878	$	13,496,806	$	(641,481)	$	21,131,203
Liabilities
Accounts payable, accrued expenses and other liabilities	$	273,933	$	—	$	(10,521)	$	263,412
Accrued compensation	285,109		—		—		285,109
Due to affiliates	194,407		—		—		194,407
Performance related compensation payable	2,286,748		—		—		2,286,748
Debt obligations	1,942,624		—		—		1,942,624

Operating lease liabilities	197,312		—		—		197,312
Liabilities of Consolidated Funds
Accounts payable, accrued expenses and other liabilities	—		100,084		(6,318)		93,766
Due to affiliates	—		33,886		(33,886)		—
Payable for securities purchased	—		561,154		—		561,154
CLO loan obligations, at fair value	—		10,434,437		(36,822)		10,397,615
Fund borrowings	—		145,088		—		145,088
Total liabilities	5,180,133		11,274,649		(87,547)		16,367,235
Commitments and contingencies
Redeemable interest in Consolidated Funds	—		1,000,000		—		1,000,000
Redeemable interest in Ares Operating Group entities	96,347		—		—		96,347
Non-controlling interest in Consolidated Funds	—		1,222,157		(521,244)		700,913
Non-controlling interest in Ares Operating Group entities	1,286,921		—		(13,261)		1,273,660
Stockholders' Equity

Class A common stock, $0.01 par value, 1,500,000,000 shares authorized (171,461,115 shares issued and outstanding)	1,715		—		—		1,715
Non-voting common stock, $0.01 par value, 500,000,000 shares authorized (3,489,911 shares issued and outstanding)	35		—		—		35
Class B common stock, $0.01 par value, 1,000 shares authorized (1,000 shares issued and outstanding)	—		—		—		—
Class C common stock, $0.01 par value, 499,999,000 shares authorized (118,464,968 shares issued and outstanding)	1,185		—		—		1,185
Additional paid-in-capital	1,870,486		—		(19,429)		1,851,057
Accumulated deficit	(154,925)		—		—		(154,925)
Accumulated other comprehensive loss, net of tax	(6,019)		—		—		(6,019)
Total stockholders' equity	1,712,477		—		(19,429)		1,693,048
Total equity	2,999,398		1,222,157		(553,934)		3,667,621
Total liabilities, redeemable interest, non-controlling interests and equity	$	8,275,878	$	13,496,806	$	(641,481)	$	21,131,203


	As of December 31, 2021
	Consolidated Company Entities		Consolidated Funds		Eliminations		Consolidated
Assets
Cash and cash equivalents	$	343,655	$	—	$	—	$	343,655
Investments (includes $2,998,421 of accrued carried interest)	4,271,836		—		(587,572)		3,684,264
Due from affiliates	696,963		—		(26,580)		670,383
Other assets	338,685		—		(3,930)		334,755
Goodwill	787,972		—		—		787,972
Intangible assets, net	1,422,818		—		—		1,422,818
Right-of-use operating lease assets	167,652		—		—		167,652
Assets of Consolidated Funds
Cash and cash equivalents	—		1,049,191		—		1,049,191
U.S. Treasury securities, at fair value	—		1,000,285		—		1,000,285
Investments, at fair value	—		11,812,093		4,300		11,816,393
Due from affiliates	—		16,761		(9,527)		7,234
Receivable for securities sold	—		281,132		—		281,132
Other assets	—		39,430		—		39,430
Total assets	$	8,029,581	$	14,198,892	$	(623,309)	$	21,605,164
Liabilities
Accounts payable, accrued expenses and other liabilities	$	289,200	$	—	$	(9,527)	$	279,673
Accrued compensation	310,222		—		—		310,222
Due to affiliates	198,553		—		—		198,553
Performance related compensation payable	2,190,352		—		—		2,190,352
Debt obligations	1,503,709		—		—		1,503,709
Operating lease liabilities	205,075		—		—		205,075
Liabilities of Consolidated Funds
Accounts payable, accrued expenses and other liabilities	—		117,139		(13,881)		103,258
Due to affiliates	—		26,210		(26,210)		—
Payable for securities purchased	—		1,118,456		—		1,118,456
CLO loan obligations, at fair value	—		10,698,681		(41,020)		10,657,661
Fund borrowings	—		127,771		—		127,771
Total liabilities	4,697,111		12,088,257		(90,638)		16,694,730
Commitments and contingencies
Redeemable interest in Consolidated Funds	—		1,000,000		—		1,000,000
Redeemable interest in Ares Operating Group entities	96,008		—		—		96,008
Non-controlling interest in Consolidated Funds	—		1,110,635		(519,183)		591,452
Non-controlling interest in Ares Operating Group entities	1,403,255		—		(5,508)		1,397,747
Stockholders' Equity

Class A common stock, $0.01 par value, 1,500,000,000 shares authorized (168,351,305 shares issued and outstanding)	1,684		—		—		1,684
Non-voting common stock, $0.01 par value, 500,000,000 shares authorized (3,489,911 shares issued and outstanding)	35		—		—		35
Class B common stock, $0.01 par value, 1,000 shares authorized (1,000 shares issued and outstanding)	—		—		—		—
Class C common stock, $0.01 par value, 499,999,000 shares authorized (118,609,332 shares issued and outstanding)	1,186		—		—		1,186
Additional paid-in-capital	1,921,539		—		(7,980)		1,913,559
Accumulated deficit	(89,382)		—		—		(89,382)
Accumulated other comprehensive income, net of tax	(1,855)		—		—		(1,855)
Total stockholders' equity	1,833,207		—		(7,980)		1,825,227
Total equity	3,236,462		1,110,635		(532,671)		3,814,426
Total liabilities, redeemable interest, non-controlling interests and equity	$	8,029,581	$	14,198,892	$	(623,309)	$	21,605,164

Schedule of Results from Operations


	Three months ended March 31, 2022
	Consolidated Company Entities		Consolidated Funds		Eliminations		Consolidated
Revenues
Management fees	$	488,811	$	—	$	(11,479)	$	477,332
Carried interest allocation	178,289		—		—		178,289
Incentive fees	16,456		—		(34)		16,422
Principal investment income	14,490		—		(6,164)		8,326
Administrative, transaction and other fees	39,399		—		(4,769)		34,630
Total revenues	737,445		—		(22,446)		714,999
Expenses
Compensation and benefits	357,243		—		—		357,243
Performance related compensation	129,405		—		—		129,405
General, administrative and other expense	120,523		—		—		120,523
Expenses of the Consolidated Funds	—		16,077		(11,564)		4,513
Total expenses	607,171		16,077		(11,564)		611,684
Other income (expense)
Net realized and unrealized gains (losses) on investments	(4,926)		—		13,035		8,109
Interest and dividend income	3,410		—		(1,908)		1,502
Interest expense	(15,646)		—		—		(15,646)
Other income, net	790		—		994		1,784
Net realized and unrealized gains on investments of the Consolidated Funds	—		23,011		(7,043)		15,968
Interest and other income of the Consolidated Funds	—		121,284		(994)		120,290
Interest expense of the Consolidated Funds	—		(77,447)		3,434		(74,013)
Total other income (expense)	(16,372)		66,848		7,518		57,994
Income before taxes	113,902		50,771		(3,364)		161,309
Income tax expense	20,386		25		—		20,411
Net income	93,516		50,746		(3,364)		140,898
Less: Net income attributable to non-controlling interests in Consolidated Funds	—		50,746		(3,364)		47,382
Net income attributable to Ares Operating Group entities	93,516		—		—		93,516
Less: Net income attributable to redeemable interest in Ares Operating Group entities	399		—		—		399
Less: Net income attributable to non-controlling interests in Ares Operating Group entities	47,254		—		—		47,254



Net income attributable to Ares Management Corporation Class A and non-voting common stockholders	$	45,863	$	—	$	—	$	45,863


	Three months ended March 31, 2021
	Consolidated Company Entities		Consolidated Funds		Eliminations		Consolidated
Revenues
Management fees	$	331,979	$	—	$	(11,706)	$	320,273
Carried interest allocation	297,535		—		—		297,535
Incentive fees	4,345		—		(1,525)		2,820
Principal investment income	25,095		—		5		25,100
Administrative, transaction and other fees	16,805		—		(4,145)		12,660
Total revenues	675,759		—		(17,371)		658,388
Expenses
Compensation and benefits	231,850		—		—		231,850
Performance related compensation	221,432		—		—		221,432
General, administrative and other expense	67,656		—		—		67,656
Expenses of the Consolidated Funds	—		17,436		(13,265)		4,171
Total expenses	520,938		17,436		(13,265)		525,109
Other income (expense)
Net realized and unrealized gains (losses) on investments	(6,118)		—		11,551		5,433
Interest and dividend income	1,863		—		(903)		960
Interest expense	(6,695)		—		—		(6,695)
Other expense, net	(3,693)		—		(456)		(4,149)
Net realized and unrealized gains on investments of the Consolidated Funds	—		26,468		(10,046)		16,422
Interest and other income of the Consolidated Funds	—		115,383		456		115,839
Interest expense of the Consolidated Funds	—		(74,535)		3,510		(71,025)
Total other income (expense)	(14,643)		67,316		4,112		56,785
Income before taxes	140,178		49,880		6		190,064
Income tax expense	25,726		28		—		25,754
Net income	114,452		49,852		6		164,310
Less: Net income attributable to non-controlling interests in Consolidated Funds	—		49,852		6		49,858
Net income attributable to Ares Operating Group entities	114,452		—		—		114,452
Less: Net income attributable to redeemable interest in Ares Operating Group entities	32		—		—		32
Less: Net income attributable to non-controlling interests in Ares Operating Group entities	56,042		—		—		56,042
Net income attributable to Ares Management Corporation	58,378		—		—		58,378
Less: Series A Preferred Stock dividends paid	5,425		—		—		5,425
Net income attributable to Ares Management Corporation Class A common stockholders	$	52,953	$	—	$	—	$	52,953

Schedule of Cash Flows


	Three months ended March 31, 2022
	Consolidated Company Entities		Consolidated Funds		Eliminations		Consolidated
Cash flows from operating activities:
Net income	$	93,516	$	50,746	$	(3,364)	$	140,898

Adjustments to reconcile net income to net cash provided by operating activities	43,970		—		9,503		53,473







Adjustments to reconcile net income to net cash provided by (used in) operating activities allocable to non-controlling interests in Consolidated Funds:	—		(104,815)		7,043		(97,772)











Cash flows due to changes in operating assets and liabilities allocable to redeemable and non-controlling interest in Consolidated Funds:	125,246		—		7,100		132,346
Change in cash and cash equivalents held at Consolidated Funds	—		(568,394)		563,599		(4,795)



Net cash provided by (used in) operating activities	262,732		(622,463)		583,881		224,150
Cash flows from investing activities:
Purchase of furniture, equipment and leasehold improvements, net of disposals	(8,524)		—		—		(8,524)
Acquisitions, net of cash acquired	(301,624)		—		—		(301,624)
Net cash used in investing activities	(310,148)		—		—		(310,148)
Cash flows from financing activities:

Proceeds from Credit Facility	860,000		—		—		860,000
Proceeds from senior notes	488,915		—		—		488,915
Repayments of Credit Facility	(905,000)		—		—		(905,000)

Dividends and distributions	(211,886)		—		—		(211,886)



Stock option exercises	3,347		—		—		3,347
Taxes paid related to net share settlement of equity awards	(183,027)		—		—		(183,027)
Other financing activities	856		—		—		856
Allocable to redeemable and non-controlling interests in Consolidated Funds:
Contributions from redeemable and non-controlling interests in Consolidated Funds	—		104,803		(21,873)		82,930
Distributions to non-controlling interests in Consolidated Funds	—		(38,931)		3,973		(34,958)
Borrowings under loan obligations by Consolidated Funds	—		49,317		—		49,317
Repayments under loan obligations by Consolidated Funds	—		(57,457)		—		(57,457)
Net cash provided by financing activities	53,205		57,732		(17,900)		93,037
Effect of exchange rate changes	(3,402)		(1,250)		—		(4,652)
Net change in cash and cash equivalents	2,387		(565,981)		565,981		2,387
Cash and cash equivalents, beginning of period	343,655		1,049,191		(1,049,191)		343,655
Cash and cash equivalents, end of period	$	346,042	$	483,210	$	(483,210)	$	346,042
Supplemental disclosure of non-cash financing activities:
Issuance of Class A common stock in connection with acquisitions	$	12,835	$	—	$	—	$	12,835


	Three months ended March 31, 2021
	Consolidated Company Entities		Consolidated Funds		Eliminations		Consolidated
Cash flows from operating activities:
Net income	$	114,452	$	49,852	$	6	$	164,310
Adjustments to reconcile net income to net cash provided by (used in) operating activities:	34,292		—		9,992		44,284







Adjustments to reconcile net income to net cash provided by (used in) operating activities allocable to non-controlling interests in Consolidated Funds:	—		(1,208,767)		587		(1,208,180)





Cash flows due to changes in operating assets and liabilities	(11,336)		—		4,292		(7,044)





Cash flows due to changes in operating assets and liabilities allocable to non-controlling interest in Consolidated Funds	—		314,126		(48,614)		265,512




Net cash provided by (used in) operating activities	137,408		(844,789)		(33,737)		(741,118)
Cash flows from investing activities:
Purchase of furniture, equipment and leasehold improvements, net of disposals	(3,284)		—		—		(3,284)

Net cash used in investing activities	(3,284)		—		—		(3,284)
Cash flows from financing activities:

Proceeds from Credit Facility	168,000		—		—		168,000



Dividends and distributions	(141,768)		—		—		(141,768)
Series A Preferred Stock dividends	(5,425)		—		—		(5,425)


Taxes paid related to net share settlement of equity awards	(84,590)		—		—		(84,590)
Other financing activities	341		—		—		341
Allocable to non-controlling interests in Consolidated Funds:
Contributions from non-controlling interests in Consolidated Funds	—		955,083		(13,148)		941,935
Distributions to non-controlling interests in Consolidated Funds	—		(50,822)		11,993		(38,829)
Borrowings under loan obligations by Consolidated Funds	—		7,000		—		7,000
Repayments under loan obligations by Consolidated Funds	—		(29,453)		—		(29,453)
Net cash provided by (used in) financing activities	(63,442)		881,808		(1,155)		817,211
Effect of exchange rate changes	(622)		(2,127)		—		(2,749)
Net change in cash and cash equivalents	70,060		34,892		(34,892)		70,060
Cash and cash equivalents, beginning of period	539,812		522,377		(522,377)		539,812
Cash and cash equivalents, end of period	$	609,872	$	557,269	$	(557,269)	$	609,872

- Definition

Tabular disclosure of the significant judgments and assumptions made in determining whether a variable interest (as defined) held by the entity requires the variable interest entity (VIE) (as defined) to be consolidated and (or) disclose information about its involvement with the VIE, individually or in aggregate (as applicable); the nature of restrictions, if any, on the consolidated VIE's assets and on the settlement of its liabilities reported by an entity in its statement of financial position, including the carrying amounts of such assets and liabilities; the nature of, and changes in, the risks associated with involvement in the VIE; how involvement with the VIE affects the entity's financial position, financial performance, and cash flows; the lack of recourse if creditors (or beneficial interest holders) of the consolidated VIE have no recourse to the general credit of the primary beneficiary (if applicable); the terms of arrangements, giving consideration to both explicit arrangements and implicit variable interests, if any, that could require the entity to provide financial support to the VIE, including events or circumstances that could expose the entity to a loss; the methodology used by the entity for determining whether or not it is the primary beneficiary of the variable interest entity; the significant factors considered and judgments made in determining that the power to direct the activities of a VIE that most significantly impact the VIE's economic performance are shared (as defined); the carrying amounts and classification of assets and liabilities of the VIE included in the statement of financial position; the entity's maximum exposure to loss, if any, as a result of its involvement with the VIE, including how the maximum exposure is determined and significant sources of the entity's exposure to the VIE; a comparison of the carrying amounts of the assets and liabilities and the entity's maximum exposure to loss; information about any liquidity arrangements, guarantees, and (or) other commitments by third parties that may affect the fair value or risk of the entity's variable interest in the VIE; whether or not the entity has provided financial support or other support (explicitly or implicitly) to the VIE that it was not previously contractually required to provide or whether the entity intends to provide that support, including the type and amount of the support and the primary reasons for providing the support; and supplemental information the entity determines necessary to provide.

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