SEGMENT REPORTING (Tables)

3 Months Ended

Mar. 31, 2013

Schedule of financial data of the entity's reportable segments

	As of and for the Three Months Ended March 31, 2013
	Private Markets			Public Markets			Capital Markets and Principal Activities		Total Reportable Segments
Fees
Management and incentive fees:
Management fees	$	106,605		$	46,358		$	—	$	152,963
Incentive fees	—			18,849			—		18,849
Management and incentive fees	106,605			65,207			—		171,812

Monitoring and transaction fees:
Monitoring fees	32,068			—			—		32,068
Transaction fees	16,412			3,106			20,781		40,299
Fee credits (1)	(21,009		)	(2,056		)	—		(23,065		)
Net monitoring and transaction fees	27,471			1,050			20,781		49,302
Total fees	134,076			66,257			20,781		221,114

Expenses
Compensation and benefits	48,001			19,700			7,461		75,162
Occupancy and related charges	11,425			1,542			355		13,322
Other operating expenses	33,942			7,826			2,862		44,630
Total expenses	93,368			29,068			10,678		133,114
Fee related earnings	40,708			37,189			10,103		88,000

Investment income (loss)
Realized carried interest	88,167			—			—		88,167
Unrealized carried interest	310,799			20,399			—		331,198
Gross carried interest	398,966			20,399			—		419,365
Less: Allocation to KKR carry pool (2)	(161,344		)	(8,160		)	—		(169,504		)
Less: Management fee refunds (3)	(9,216		)	—			—		(9,216		)
Net carried interest	228,406			12,239			—		240,645
Other investment income (loss)	(2,035		)	62			322,171		320,198
Total investment income (loss)	226,371			12,301			322,171		560,843

Income (loss) before noncontrolling interests in income of consolidated entities	267,079			49,490			332,274		648,843
Income (loss) attributable to noncontrolling interests (4)	398			355			348		1,101

Economic net income (loss)	$	266,681		$	49,135		$	331,926	$	647,742

Total Assets	$	1,378,436		$	383,213		$	6,458,470	$	8,220,119

Book Value	$	1,288,030		$	359,112		$	5,421,250	$	7,068,392

(1) KKR’s agreements with the fund investors of certain of its investment funds require KKR to share with these fund investors an agreed upon percentage of monitoring and transaction fees received from portfolio companies (“Fee Credits”). Fund investors receive Fee Credits only with respect to monitoring and transaction fees that are allocable to the fund’s investment in the portfolio company and not, for example, any fees allocable to capital invested through co-investment vehicles. Fee Credits are calculated after deducting certain fund-related expenses and generally amount to 80% of allocable monitoring and transaction fees after fund-related expenses are recovered, although the actual percentage may vary from fund to fund.

(2) With respect to KKR’s active and future investment funds and co-investment vehicles that provide for carried interest, KKR will allocate to its principals, other professionals and selected other individuals who work in these operations a portion of the carried interest earned in relation to these funds as part of its carry pool.

(3) Certain of KKR’s private equity funds require the management company to refund up to 20% of any cash management fees earned from fund investors in the event that the funds recognize a carried interest. At such time as the fund recognizes a carried interest in an amount sufficient to cover 20% of the cash management fees earned or a portion thereof, a liability to the fund investors is recorded and revenue is reduced for the amount of the carried interest recognized, not to exceed 20% of the cash management fees earned. As of March 31, 2013, there is no carried interest subject to management fee refunds, which may reduce carried interest in future periods. The refunds to the fund investors are paid, and the liabilities relieved, at such time that the underlying investments are sold and the associated carried interests are realized. In the event that a fund’s carried interest is not sufficient to cover any of the amount that represents 20% of the cash management fees earned, these fees would not be returned to the fund investors, in accordance with the respective fund agreements.

(4) Represents economic interests that will (i) allocate to a former principal an aggregate of 1% of profits and losses of KKR’s management companies until a future date and (ii) allocate to a third party investor approximately 2% of the profits and losses in KKR’s capital markets business.

	As of and for the Three Months Ended March 31, 2012
	Private Markets			Public Markets			Capital Markets and Principal Activities		Total Reportable Segments
Fees
Management and incentive fees:
Management fees	$	106,912		$	21,731		$	—	$	128,643
Incentive fees	—			9,670			—		9,670
Management and incentive fees	106,912			31,401			—		138,313

Monitoring and transaction fees:
Monitoring fees	25,822			—			—		25,822
Transaction fees	11,667			2,422			30,209		44,298
Fee credits (1)	(17,706		)	(1,637		)	—		(19,343		)
Net monitoring and transaction fees	19,783			785			30,209		50,777
Total fees	126,695			32,186			30,209		189,090

Expenses
Compensation and benefits	44,486			11,382			6,856		62,724
Occupancy and related charges	12,805			1,418			238		14,461
Other operating expenses	31,675			3,977			2,897		38,549
Total expenses	88,966			16,777			9,991		115,734
Fee related earnings	37,729			15,409			20,218		73,356

Investment income (loss)
Realized carried interest	74,878			—			—		74,878
Unrealized carried interest	379,627			14,859			—		394,486
Gross carried interest	454,505			14,859			—		469,364
Less: Allocation to KKR carry pool (2)	(185,562		)	(5,944		)	—		(191,506		)
Less: Management fee refunds (3)	(40,708		)	—			—		(40,708		)
Net carried interest	228,235			8,915			—		237,150
Other investment income (loss)	1,652			(23		)	418,278		419,907
Total investment income (loss)	229,887			8,892			418,278		657,057

Income (loss) before noncontrolling interests in income of consolidated entities	267,616			24,301			438,496		730,413
Income (loss) attributable to noncontrolling interests (4)	2,296			431			484		3,211

Economic net income (loss)	$	265,320		$	23,870		$	438,012	$	727,202

Total Assets	$	977,928		$	82,917		$	5,714,419	$	6,775,264

Book Value	$	818,495		$	70,903		$	5,187,758	$	6,077,156

(1) KKR’s agreements with the fund investors of certain of its investment funds require KKR to share with these fund investors an agreed upon percentage of monitoring and transaction fees received from portfolio companies. Fund investors receive Fee Credits only with respect to monitoring and transaction fees that are allocable to the fund’s investment in the portfolio company and not, for example, any fees allocable to capital invested through co-investment vehicles. Fee Credits are calculated after deducting certain fund-related expenses and generally amount to 80% of allocable monitoring and transaction fees after fund-related expenses are recovered, although the actual percentage may vary from fund to fund.

(3) Certain of KKR’s private equity funds require the management company to refund up to 20% of any cash management fees earned from fund investors in the event that the funds recognize a carried interest. At such time as the fund recognizes a carried interest in an amount sufficient to cover 20% of the cash management fees earned or a portion thereof, a liability to the fund’s fund investors is recorded and revenue is reduced for the amount of the carried interest recognized, not to exceed 20% of the cash management fees earned. As of March 31, 2012, the amount subject to refund for which no liability was recorded was approximately $66.0 million as a result of certain funds not yet recognizing sufficient carried interests. The refunds to the fund investors are paid, and the liabilities relieved, at such time that the underlying investments are sold and the associated carried interests are realized. In the event that a fund’s carried interest is not sufficient to cover any of the amount that represents 20% of the cash management fees earned, these fees would not be returned to the fund investors, in accordance with the respective fund agreements.

Schedule of reconciliation of financial information from total reportable segments to consolidated financial statements

	As of and for the Three Months Ended March 31, 2013
	Total Reportable Segments		Adjustments			Consolidated
Fees(a)	$	221,114	$	(69,874	)	$	151,240
Expenses(b)	$	133,114	$	306,216		$	439,330
Investment income (loss)(c)	$	560,843	$	1,834,789		$	2,395,632
Income (loss) before taxes	$	648,843	$	1,458,699		$	2,107,542
Income (loss) attributable to redeemable noncontrolling interests	$	—	$	24,623		$	24,623
Income (loss) attributable to noncontrolling interests	$	1,101	$	1,879,023		$	1,880,124
Total Assets(d)	$	8,220,119	$	37,322,672		$	45,542,791
Book Value (e)	$	7,068,392	$	(4,912,323	)	$	2,156,069

(a) The fees adjustment primarily represents (i) the elimination of management fees of $112,696 upon consolidation of KKR’s funds and vehicles, (ii) the elimination of Fee Credits of $22,261 upon consolidation of the KKR funds and vehicles, (iii) inclusion of reimbursable expenses of $6,580 and (iv) other adjustments of $13,981.

(b) The expenses adjustment primarily represents (i) the inclusion of non-cash equity based charges borne by KKR Holdings or granted under the Equity Incentive Plan, which amounted to $81,650 (ii) allocations to the carry pool of $169,504, (iii) a gross up of reimbursable expenses of $8,473, (iv) operating expenses of $16,928 primarily associated with the inclusion of operating expenses upon consolidation of KKR’s funds and vehicles and other entities and (v) other adjustments of $29,661.

(c) The investment income (loss) adjustment primarily represents (i) the inclusion of net investment income of $1,656,069 attributable to noncontrolling interests upon consolidation of KKR’s funds and vehicles, (ii) exclusion of allocations to the carry pool of $169,504 and (iii) exclusion of management fee refunds of $9,216.

(d) Substantially all of the total assets adjustment represents the inclusion of private equity and real assets and other investments that are attributable to noncontrolling interests upon consolidation of KKR’s funds and vehicles.

(e) The book value adjustment represents the exclusion of noncontrolling interests held by KKR Holdings of $4,950,914 and the equity impact of KKR Management Holdings Corp. equity and other of $38,591.

	As of and for the Three Months Ended March 31, 2012
	Total Reportable Segments		Adjustments			Consolidated
Fees(a)	$	189,090	$	(72,783	)	$	116,307
Expenses(b)	$	115,734	$	329,524		$	445,258
Investment income (loss)(c)	$	657,057	$	2,660,941		$	3,317,998
Income (loss) before taxes	$	730,413	$	2,258,634		$	2,989,047
Income (loss) attributable to redeemable noncontrolling interests	$	—	$	5,272		$	5,272
Income (loss) attributable to noncontrolling interests	$	3,211	$	2,773,056		$	2,776,267
Total Assets(d)	$	6,775,264	$	36,745,148		$	43,520,412
Book Value (e)	$	6,077,156	$	(4,566,883	)	$	1,510,273

(a) The fees adjustment primarily represents (i) the elimination of management fees of $108,438 upon consolidation of KKR’s funds and vehicles, (ii) the elimination of Fee Credits of $18,707 upon consolidation of KKR’s funds and vehicles, (iii) inclusion of reimbursable expenses of $3,660 and (iv) other adjustments of $13,288.

(b) The expenses adjustment primarily represents (i) the inclusion of non-cash equity based charges borne by KKR Holdings or granted under the Equity Incentive Plan, which amounted to $114,341 (ii) allocations to the carry pool of $191,506, (iii) a gross up of reimbursable expenses of $6,189, (iv) operating expenses of $15,813 primarily associated with the inclusion of operating expenses upon consolidation of KKR’s funds and vehicles and other entities and (v) other adjustments of $1,675.

(c) The investment income (loss) adjustment primarily represents (i) the inclusion of a net investment income of $2,428,727 attributable to noncontrolling interests upon consolidation of KKR’s funds and vehicles, (ii) exclusion of allocations to the carry pool of $191,506, and (iii) exclusion of management fee refunds of $40,708.

(e) The book value adjustment represents the exclusion of noncontrolling interests held by KKR Holdings of $4,560,614 and the equity impact of KKR Management Holdings Corp. equity and other of $6,269.

Schedule of reconciliation of net income (loss) attributable to KKR & Co. L.P to economic net income and fee related earnings

	Three Months Ended March 31, 2013
Net income (loss) attributable to KKR & Co. L.P.	$	193,439
Plus: Net income (loss) attributable to noncontrolling interests held by KKR Holdings	334,112
Plus: Equity based compensation	81,650
Plus: Amortization of intangibles and other, net	29,185
Plus: Income taxes	9,356
Economic net income (loss)	647,742
Plus: Income attributable to segment noncontrolling interests	1,101
Less: Investment income (loss)	560,843
Fee related earnings	$	88,000

	Three Months Ended March 31, 2012
Net income (loss) attributable to KKR & Co. L.P.	$	190,436
Plus: Net income (loss) attributable to noncontrolling interests held by KKR Holdings	404,191
Plus: Equity based compensation	114,341
Plus: Amortization of intangibles and other, net	1,162
Plus: Income taxes	17,072
Economic net income (loss)	727,202
Plus: Income attributable to segment noncontrolling interests	3,211
Less: Investment income (loss)	657,057
Fee related earnings	$	73,356

- Definition

Tabular disclosure of the profit or loss and total assets for each reportable segment. An entity discloses certain information on each reportable segment if the amounts (a) are included in the measure of segment profit or loss reviewed by the chief operating decision maker or (b) are otherwise regularly provided to the chief operating decision maker, even if not included in that measure of segment profit or loss.

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