10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

ý QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2015

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE TRANSITION PERIOD FROM                      TO                     

Commission File Number: 001-35538

The Carlyle Group L.P.

(Exact name of registrant as specified in its charter)

Delaware	45-2832612
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

1001 Pennsylvania Avenue, NW

Washington, D.C., 20004-2505

(Address of principal executive offices) (Zip Code)

(202) 729-5626

(Registrant’s telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ý    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  ý    No  ¨

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	ý	Accelerated filer	¨
Non-accelerated filer	¨ (Do not check if a smaller reporting company)	Smaller reporting company	¨

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ¨    No  ý

The number of the Registrant’s common units representing limited partner interests outstanding as of April 30, 2015 was 68,906,237.

TABLE OF CONTENTS

		Page
PART I – FINANCIAL INFORMATION
Item 1.	Financial Statements	5
	Unaudited Condensed Consolidated Financial Statements – March 31, 2015 and 2014:
	Condensed Consolidated Balance Sheets as of March 31, 2015 and December 31, 2014	5
	Condensed Consolidated Statements of Operations for the Three Months Ended March 31, 2015 and 2014	6
	Condensed Consolidated Statements of Comprehensive Income for the Three Months Ended March 31, 2015 and 2014	7
	Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2015 and 2014	8
	Notes to the Condensed Consolidated Financial Statements	9
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	63
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	129
Item 4.	Controls and Procedures	130
PART II – OTHER INFORMATION
Item 1.	Legal Proceedings	131
Item 1A.	Risk Factors	131
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	131
Item 3.	Defaults Upon Senior Securities	131
Item 4.	Mine Safety Disclosures	131
Item 5.	Other Information	131
Item 6.	Exhibits	131
SIGNATURE		132
INDEX TO EXHIBITS		133

1

Forward-Looking Statements

This report may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, which reflect our current views with respect to, among other things, our operations and financial performance. You can identify these forward-looking statements by the use of words such as “outlook,” “believe,” “expect,” “potential,” “continue,” “may,” “will,” “should,” “seek,” “approximately,” “predict,” “intend,” “plan,” “estimate,” “anticipate” or the negative version of these words or other comparable words. Such forward-looking statements are subject to various risks and uncertainties. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. We believe these factors include but are not limited to those described under “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2014, as such factors may be updated from time to time in our periodic filings with the United States Securities and Exchange Commission (the “SEC”), which are accessible on the SEC’s website at www.sec.gov. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this report and in our other periodic filings. We undertake no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by law.

Website and Social Media Disclosure

We use our website (www.carlyle.com), our corporate Facebook page (http://www.facebook.com/pages/The-Carlyle-Group/103519702981?rf=110614118958798) and our corporate Twitter account (@OneCarlyle) as channels of distribution of material company information. For example, financial and other material information regarding our company is routinely posted on and accessible at www.carlyle.com. Accordingly, investors should monitor these channels, in addition to following our press releases, SEC filings and public conference calls and webcasts. In addition, you may automatically receive email alerts and other information about Carlyle when you enroll your email address by visiting the “Email Alert Subscription” section at http://ir.carlyle.com/alerts.cfm?. The contents of our website and social media channels are not, however, a part of this Quarterly Report on Form 10-Q and are not incorporated by reference herein.

Unless the context suggests otherwise, references in this report to “Carlyle,” the “Company,” “we,” “us” and “our” refer to The Carlyle Group L.P. and its consolidated subsidiaries. When we refer to the “partners of The Carlyle Group L.P.,” we are referring specifically to the common unitholders and our general partner and any others who may from time to time be partners of that specific Delaware limited partnership. When we refer to our “senior Carlyle professionals,” we are referring to the partner-level personnel of our firm. References in this report to the ownership of the senior Carlyle professionals include the ownership of personal planning vehicles of these individuals.

“Carlyle funds,” “our funds” and “our investment funds” refer to the investment funds and vehicles advised by Carlyle. Our “carry funds” refer to (i) those investment funds that we advise, including the buyout funds, growth capital funds, real estate funds, infrastructure funds, certain energy funds and distressed debt and mezzanine funds (but excluding our structured credit funds, hedge funds, business development companies, mutual fund, and fund of funds vehicles), where we receive a special residual allocation of income, which we refer to as a carried interest, in the event that specified investment returns are achieved by the fund and (ii) those investment funds advised by NGP Energy Capital Management (together with its affiliates and subsidiaries, “NGP”) from which we are entitled to receive a carried interest. The “NGP management fee funds” refer to those funds advised by NGP from which we only receive an allocation of income based on the funds' management fees. Our “fund of funds vehicles” refers to those funds, accounts and vehicles advised by AlpInvest Partners B.V. (“AlpInvest”), Metropolitan Real Estate Equity Management, LLC (“Metropolitan”), and Diversified Global Asset Management (“DGAM”). For an explanation of the fund acronyms used throughout this Quarterly Report, refer to “Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations - Our Family of Funds.”

“Fee-earning assets under management” or “Fee-earning AUM” refer to the assets we manage or advise from which we derive recurring fund management fees. Our Fee-earning AUM generally equals the sum of:

(a) for substantially all carry funds and certain co-investment vehicles where the original investment period has not expired and for Metropolitan fund of funds vehicles during the weighted-average investment period of the underlying funds, the amount of limited partner capital commitments, for AlpInvest fund of funds vehicles, the amount of external investor capital commitments during the commitment fee period, and for the NGP management

2

fee funds and certain carry funds advised by NGP, the amount of investor capital commitments before the first investment realization;

(b) for substantially all carry funds and certain co-investment vehicles where the original investment period has expired and for Metropolitan fund of funds vehicles after the expiration of the weighted-average investment period of the underlying funds, the remaining amount of limited partner invested capital, and for the NGP management fee funds and certain carry funds advised by NGP where the first investment has been realized, the amount of partner commitments less realized and written-off investments;

(c) the amount of aggregate fee-earning collateral balance at par of our collateralized loan obligations (“CLOs”), as defined in the fund indentures (typically exclusive of equities and defaulted positions) as of the quarterly cut-off date for each CLO, and the aggregate principal amount of the notes of our other structured products;

(d) the net asset value of our mutual fund and the external investor portion of the net asset value (pre-redemptions and subscriptions) of our long/short credit funds, emerging markets, multi-product macroeconomic, fund of hedge funds vehicles and other hedge funds;

(e) the gross assets (including assets acquired with leverage), excluding cash and cash equivalents of our business development companies and certain carry funds; and

(f) for AlpInvest fund of funds vehicles where the commitment fee period has expired, and certain carry funds where the investment period has expired, the lower of cost or fair value of invested capital.

“Assets under management” or “AUM” refers to the assets we manage or advise. Our AUM equals the sum of the following:

(a) the fair value of the capital invested in Carlyle carry funds, co-investment vehicles, NGP management fee funds and fund of funds vehicles plus the capital that Carlyle is entitled to call from investors in those funds and vehicles (including Carlyle commitments to those funds and vehicles and those of senior Carlyle professionals and employees) pursuant to the terms of their capital commitments to those funds and vehicles;

(b) the amount of aggregate collateral balance and principal cash at par or aggregate principal amount of the notes of our CLOs and other structured products (inclusive of all positions);

(c) the net asset value (pre-redemptions and subscriptions) of our long/short credit, emerging markets, multi-product macroeconomic, fund of hedge funds vehicles, mutual fund and other hedge funds; and

(d) the gross assets (including assets acquired with leverage) of our business development companies.

We include in our calculation of AUM and Fee-earning AUM certain energy and renewable resources funds that we jointly advise with Riverstone Holdings L.L.C. (“Riverstone”) and certain NGP management fee funds and carry funds that are advised by NGP. Although we include all capital commitments to the NGP Natural Resources XI, L.P. fund (“NGP XI”) in our assets under management calculation, for certain limited partners we will only include invested capital for NGP XI in our Fee-earning AUM calculation until early 2016 when we will be entitled to charge management fees based on commitments less realized and written-off investments.

For our carry funds, co-investment vehicles, fund of funds vehicles, and NGP management fee funds, total AUM includes the fair value of the capital invested, whereas Fee-earning AUM includes the amount of capital commitments or the remaining amount of invested capital, depending on whether the original investment period for the fund has expired. As such, Fee-earning AUM may be greater than total AUM when the aggregate fair value of the remaining investments is less than the cost of those investments.

Our calculations of AUM and Fee-earning AUM may differ from the calculations of other alternative asset managers. As a result, these measures may not be comparable to similar measures presented by other alternative asset managers. In addition, our calculation of AUM (but not Fee-earning AUM) includes uncalled commitments to, and the fair value of invested capital in, our investment funds from Carlyle and our personnel, regardless of whether such commitments or invested capital are subject to

3

management or performance fees. Our calculations of AUM or Fee-earning AUM are not based on any definition of AUM or Fee-earning AUM that is set forth in the agreements governing the investment funds that we manage or advise.

With respect to certain of the hedge funds and vehicles that we advise, we are entitled to incentive fees that are paid annually, semi-annually or quarterly, as the case may be, if the net asset value of an investor's account has increased. A fund or vehicle's “high-water mark” refers to the highest period end net asset value of an investor's account on which incentive fees were previously paid.

4

PART I – FINANCIAL INFORMATION

Item1.         Financial Statements

The Carlyle Group L.P.

Condensed Consolidated Balance Sheets

(Dollars in millions)

	March 31, 2015			December 31, 2014
	(Unaudited)
Assets
Cash and cash equivalents	$	1,024.8		$	1,242.0
Cash and cash equivalents held at Consolidated Funds	1,436.7			1,551.1
Restricted cash	41.0			59.7
Restricted cash and securities of Consolidated Funds	18.8			14.9
Accrued performance fees	3,767.2			3,795.6
Investments	944.2			931.6
Investments of Consolidated Funds	25,949.1			26,028.8
Due from affiliates and other receivables, net	202.8			199.4
Due from affiliates and other receivables of Consolidated Funds, net	688.9			1,213.2
Receivables and inventory of a consolidated real estate VIE	185.0			163.9
Fixed assets, net	86.7			75.4
Deposits and other	60.9			59.2
Other assets of a consolidated real estate VIE	73.7			86.4
Intangible assets, net	399.3			442.1
Deferred tax assets	134.1			131.0
Total assets	$	35,013.2		$	35,994.3
Liabilities and partners’ capital
Loans payable	$	38.4		$	40.2
3.875% senior notes due 2023	499.9			499.9
5.625% senior notes due 2043	606.8			606.8
Loans payable of Consolidated Funds	16,554.6			16,052.2
Loans payable of a consolidated real estate VIE at fair value (principal amount of $214.8 million and $243.6 million as of March 31, 2015 and December 31, 2014, respectively)	139.6			146.2
Accounts payable, accrued expenses and other liabilities	389.9			396.2
Accrued compensation and benefits	2,202.0			2,312.5
Due to affiliates	191.5			184.2
Deferred revenue	196.5			93.7
Deferred tax liabilities	105.0			112.2
Other liabilities of Consolidated Funds	1,708.7			2,504.9
Other liabilities of a consolidated real estate VIE	105.4			84.9
Accrued giveback obligations	176.6			104.4
Total liabilities	22,914.9			23,138.3
Commitments and contingencies
Redeemable non-controlling interests in consolidated entities	3,939.9			3,761.5
Partners’ capital (common units 68,906,237 and 67,761,012 issued and outstanding as of March 31, 2015 and December 31, 2014, respectively)	528.0			566.0
Accumulated other comprehensive loss	(50.4		)	(39.0		)
Partners’ capital appropriated for Consolidated Funds	126.9			184.5
Non-controlling interests in consolidated entities	5,925.7			6,446.4
Non-controlling interests in Carlyle Holdings	1,628.2			1,936.6
Total partners’ capital	8,158.4			9,094.5
Total liabilities and partners’ capital	$	35,013.2		$	35,994.3

See accompanying notes.

5

The Carlyle Group L.P.

Condensed Consolidated Statements of Operations

(Unaudited)

(Dollars in millions, except unit and per unit data)

	Three Months Ended   March 31,
	2015			2014
Revenues
Fund management fees	$	269.5		$	260.3
Performance fees
Realized	326.8			251.4
Unrealized	246.2			369.1
Total performance fees	573.0			620.5
Investment income (loss)
Realized	8.9			—
Unrealized	(2.1		)	6.1
Total investment income	6.8			6.1
Interest and other income	6.0			3.8
Interest and other income of Consolidated Funds	226.3			250.7
Revenue of a consolidated real estate VIE	55.2			6.0
Total revenues	1,136.8			1,147.4
Expenses
Compensation and benefits
Base compensation	180.1			204.6
Equity-based compensation	89.9			74.2
Performance fee related
Realized	143.0			108.7
Unrealized	173.7			221.6
Total compensation and benefits	586.7			609.1
General, administrative and other expenses	116.8			134.3
Interest	14.6			12.2
Interest and other expenses of Consolidated Funds	237.8			264.0
Interest and other expenses of a consolidated real estate VIE	70.0			49.2
Other non-operating expense	1.1			30.2
Total expenses	1,027.0			1,099.0
Other income
Net investment gains of Consolidated Funds	505.5			424.0
Income before provision for income taxes	615.3			472.4
Provision for income taxes	10.5			16.0
Net income	604.8			456.4
Net income attributable to non-controlling interests in consolidated entities	439.1			324.5
Net income attributable to Carlyle Holdings	165.7			131.9
Net income attributable to non-controlling interests in Carlyle Holdings	126.2			107.3
Net income attributable to The Carlyle Group L.P.	$	39.5		$	24.6
Net income attributable to The Carlyle Group L.P. per common unit (see Note 15)
Basic	$	0.58		$	0.46
Diluted	$	0.54		$	0.41
Weighted-average common units
Basic	67,684,674			52,501,412
Diluted	72,347,771			59,453,670
Distributions declared per common unit	$	1.61		$	1.40

Substantially all revenue is earned from affiliates of the Partnership. See accompanying notes.

6

The Carlyle Group L.P.

Condensed Consolidated Statements of Comprehensive Income

(Unaudited)

(Dollars in millions)

	Three Months Ended   March 31,
	2015			2014
Net income	$	604.8		$	456.4
Other comprehensive income (loss)
Foreign currency translation adjustments	(465.1		)	87.8
Cash flow hedges
Reclassification adjustment for loss included in interest expense	0.5			0.6
Defined benefit plans
Unrealized gain for the period	2.6			0.8
Less: reclassification adjustment for loss during the period, included in base compensation expense	0.1			0.1
Other comprehensive income (loss)	(461.9		)	89.3
Comprehensive income	142.9			545.7
Less: Comprehensive loss attributable to partners’ capital appropriated for Consolidated Funds	57.6			82.5
Less: Comprehensive income attributable to non-controlling interests in consolidated entities	(61.4		)	(431.3		)
Less: Comprehensive income attributable to redeemable non-controlling interests in consolidated entities	(76.5		)	(67.0		)
Comprehensive income attributable to Carlyle Holdings	62.6			129.9
Less: Comprehensive income attributable to non-controlling interests in Carlyle Holdings	(30.5		)	(105.8		)
Comprehensive income attributable to The Carlyle Group L.P.	$	32.1		$	24.1

See accompanying notes.

7

The Carlyle Group L.P.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(Dollars in millions)

	Three Months Ended March 31,
	2015			2014
Cash flows from operating activities
Net income	$	604.8		$	456.4
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation and amortization	39.9			57.7
Equity-based compensation	89.9			74.2
Excess tax benefits related to equity-based compensation	(0.5		)	—
Non-cash performance fees	(275.7		)	(446.3		)
Other non-cash amounts	23.8			42.6
Consolidated Funds related:
Realized/unrealized gain on investments of Consolidated Funds	(576.4		)	(474.1		)
Realized/unrealized loss from loans payable of Consolidated Funds	48.8			66.5
Purchases of investments by Consolidated Funds	(2,139.0		)	(2,418.6		)
Proceeds from sale and settlements of investments by Consolidated Funds	1,992.4			2,801.2
Non-cash interest income, net	(4.0		)	(8.9		)
Change in cash and cash equivalents held at Consolidated Funds	778.1			(31.7		)
Change in other receivables held at Consolidated Funds	367.2			310.4
Change in other liabilities held at Consolidated Funds	208.1			265.0
Investment income	(3.7		)	(6.9		)
Purchases of investments and trading securities	(20.1		)	(12.0		)
Proceeds from the sale of investments and trading securities	271.4			390.8
Payments of contingent consideration	(3.3		)	(43.5		)
Changes in deferred taxes, net	(0.3		)	1.4
Change in due from affiliates and other receivables	(7.8		)	(5.3		)
Change in receivables and inventory of a consolidated real estate VIE	(34.4		)	(0.8		)
Change in deposits and other	(6.3		)	(7.1		)
Change in other assets of a consolidated real estate VIE	15.8			11.5
Change in accounts payable, accrued expenses and other liabilities	(33.1		)	(32.3		)
Change in accrued compensation and benefits	(11.4		)	(57.3		)
Change in due to affiliates	12.0			(83.9		)
Change in other liabilities of a consolidated real estate VIE	31.9			7.3
Change in deferred revenue	106.9			133.5
Net cash provided by operating activities	1,475.0			989.8
Cash flows from investing activities
Change in restricted cash	18.3			84.5
Purchases of fixed assets, net	(17.4		)	(3.7		)
Acquisitions, net of cash acquired	—			(3.1		)
Net cash provided by investing activities	0.9			77.7
Cash flows from financing activities
Issuance of 5.625% senior notes due 2043, net of financing costs	—			210.8
Net payments on loans payable of a consolidated real estate VIE	(11.1		)	(9.5		)
Net borrowings (payments) on loans payable of Consolidated Funds	402.2			(323.2		)
Payments of contingent consideration	(0.5		)	(29.2		)
Excess tax benefits related to equity-based compensation	0.5			—
Distributions to common unitholders	(110.9		)	(70.4		)
Distributions to non-controlling interest holders in Carlyle Holdings	(403.6		)	(366.5		)
Net proceeds from issuance of common units, net of offering costs	—			449.5
Acquisition of non-controlling interests in Carlyle Holdings	—			(303.4		)
Contributions from non-controlling interest holders	752.2			753.3
Distributions to non-controlling interest holders	(1,268.4		)	(1,256.9		)
Change in due to/from affiliates financing activities	(5.2		)	1.6
Change in due to/from affiliates and other receivables of Consolidated Funds	(962.2		)	(53.9		)
Net cash used in financing activities	(1,607.0		)	(997.8		)
Effect of foreign exchange rate changes	(86.1		)	(2.0		)
(Decrease) increase in cash and cash equivalents	(217.2		)	67.7
Cash and cash equivalents, beginning of period	1,242.0			966.6
Cash and cash equivalents, end of period	$	1,024.8		$	1,034.3
Supplemental non-cash disclosures
Net increase in partners’ capital and accumulated other comprehensive income related to reallocation of ownership interest in Carlyle Holdings	$	9.2		$	32.9
Initial consolidation of Consolidated Funds	$	36.0		$	—
Tax effect from acquisition of Carlyle Holdings partnership units:
Deferred tax asset	$	—		$	70.0
Tax receivable agreement liability	$	—		$	60.1
Total partners’ capital	$	—		$	9.9

See accompanying notes.

8

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

1. Organization and Basis of Presentation

The Carlyle Group L.P., together with its consolidated subsidiaries (the “Partnership” or “Carlyle”), is one of the world’s largest global alternative asset management firms that originates, structures and acts as lead equity investor in management-led buyouts, strategic minority equity investments, equity private placements, consolidations and buildups, growth capital financings, real estate opportunities, bank loans, high-yield debt, distressed assets, mezzanine debt and other investment opportunities. The Partnership is a Delaware limited partnership formed on July 18, 2011. The Partnership is managed and operated by its general partner, Carlyle Group Management L.L.C., which is in turn wholly-owned and controlled by Carlyle’s founders and other senior Carlyle professionals.

Carlyle provides investment management services to, and has transactions with, various private equity funds, real estate funds, business development companies, collateralized loan obligations (“CLOs”), hedge funds and other investment products sponsored by the Partnership for the investment of client assets in the normal course of business. Carlyle typically serves as the general partner, investment manager or collateral manager, making day-to-day investment decisions concerning the assets of these products. Carlyle operates its business through four reportable segments: Corporate Private Equity, Global Market Strategies, Real Assets and Investment Solutions (see Note 18).

Basis of Presentation

The accompanying financial statements include the accounts of the Partnership and its consolidated subsidiaries. In addition, certain Carlyle-affiliated funds, related co-investment entities, certain CLOs managed by the Partnership (collectively the “Consolidated Funds”) and a real estate development company (see Note 17) have been consolidated in the accompanying financial statements pursuant to accounting principles generally accepted in the United States (“U.S. GAAP”), as described in Note 2. The consolidation of the Consolidated Funds generally has a gross-up effect on assets, liabilities and cash flows, and has no effect on the net income attributable to the Partnership. The majority economic ownership interests of the investors in the Consolidated Funds are reflected as non-controlling interests in consolidated entities, partners’ capital appropriated for Consolidated Funds and redeemable non-controlling interests in consolidated entities in the accompanying condensed consolidated financial statements.

The accompanying condensed consolidated financial statements have been prepared in accordance with U.S. GAAP for interim financial information. These statements, including notes, have not been audited, exclude some of the disclosures required for annual financial statements, and should be read in conjunction with the audited consolidated financial statements included in the Partnership’s Annual Report on Form 10-K for the year ended December 31, 2014 filed with the Securities and Exchange Commission ("SEC"). The operating results presented for interim periods are not necessarily indicative of the results that may be expected for any other interim period or for the entire year. In the opinion of management, the condensed consolidated financial statements reflect all adjustments, consisting of normal recurring accruals, which are necessary for the fair presentation of the financial condition and results of operations for the interim periods presented.

March 2014 Public Offering of Partnership Common Units

On March 10, 2014, the Partnership completed a public offering of 13,800,000 common units priced at $33.50 per common unit. The Partnership received net proceeds of approximately $449.5 million, after deduction of the underwriting discount and offering expenses. The Partnership’s wholly-owned subsidiaries used $146.1 million of the net proceeds to acquire 4,500,000 newly issued Carlyle Holdings partnership units from Carlyle Holdings. These proceeds are being used by Carlyle Holdings for general corporate purposes, including investments in Carlyle’s funds as well as investment capital for acquisitions of new fund platforms and strategies or other growth initiatives, to drive innovation across the broader Carlyle platform. The Partnership’s wholly-owned subsidiaries used the remaining net proceeds of $303.4 million to acquire 9,300,000 Carlyle Holding partnership units from the other limited partners of Carlyle Holdings, including certain of the Partnership’s directors and executive officers.

As it relates to the 4,500,000 newly issued Carlyle Holdings partnership units that the Partnership acquired, because the Partnership acquired these partnership units at a valuation in excess of the proportion of the book value of the net assets acquired, the Partnership incurred an immediate dilution of approximately $116.8 million. This dilution was reflected within partners’ capital as a reallocation from partners’ capital to non-controlling interests in Carlyle Holdings.

9

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

As it relates to the 9,300,000 Carlyle Holdings partnership units that the Partnership acquired from the other limited partners of Carlyle Holdings, the Partnership accounted for this transaction as an acquisition of ownership interests in a subsidiary while retaining a controlling interest in the subsidiary. Accordingly, the carrying value of the non-controlling interest was adjusted to reflect the change in the ownership interests in Carlyle Holdings. The excess of the fair value of the consideration issued by the Partnership over the carrying amount of the non-controlling interest acquired on the transaction date was $237.0 million, which was recognized directly as a reduction to partners’ capital.

Additionally, the acquisition by the Partnership of the 9,300,000 Carlyle Holdings partnership units from the other limited partners of Carlyle Holdings is subject to the terms of the tax receivable agreement. Accordingly, the Partnership recorded a deferred tax asset of $70.0 million, an increase to the liability owed under the tax receivable agreement of $60.1 million, and an increase in partners’ capital of $9.9 million based on estimated tax information available at the time. The liability is expected to be paid as the deferred tax asset is realized as a reduction in taxes payable.

2. Summary of Significant Accounting Policies

Principles of Consolidation

The Partnership consolidates all entities that it controls through a majority voting interest or otherwise. In addition, the accompanying condensed consolidated financial statements consolidate: (1) Carlyle-affiliated funds and co-investment entities, for which the Partnership is the sole general partner and the presumption of control by the general partner has not been overcome and (2) variable interest entities (“VIEs”), including certain CLOs and a real estate development company, for which the Partnership is deemed to be the primary beneficiary; consolidation of these entities is a requirement under U.S. GAAP. All significant inter-entity transactions and balances have been eliminated.

For entities that are determined to be VIEs, the Partnership consolidates those entities where it is deemed to be the primary beneficiary. An entity is determined to be the primary beneficiary if it holds a controlling financial interest. A controlling financial interest is defined as (a) the power to direct the activities of a VIE that most significantly impact the entity’s business and (b) the obligation to absorb losses of the entity or the right to receive benefits from the entity that could potentially be significant to the VIE. The revised consolidation rules require an analysis to (a) determine whether an entity in which the Partnership holds a variable interest is a VIE and (b) whether the Partnership’s involvement, through holding interests directly or indirectly in the entity or contractually through other variable interests (e.g., management and performance related fees), would give it a controlling financial interest. In evaluating whether the Partnership is the primary beneficiary, the Partnership evaluates its economic interests in the entity held either directly or indirectly by the Partnership. The consolidation analysis is generally performed qualitatively. This analysis, which requires judgment, is performed at each reporting date.

In February 2010, Accounting Standards Update (“ASU”) No. 2010-10, “Amendments for Certain Investment Funds,” was issued. This ASU defers the application of the revised consolidation rules for a reporting enterprise’s interest in an entity if certain conditions are met, including if the entity has the attributes of an investment company and is not a securitization or asset-backed financing entity. An entity that qualifies for the deferral will continue to be assessed for consolidation under the overall guidance on VIEs, before its amendment, and other applicable consolidation guidance.

As of March 31, 2015, assets and liabilities of consolidated VIEs reflected in the condensed consolidated balance sheets were $24.2 billion and $18.3 billion, respectively. Except to the extent of the assets of the VIEs which are consolidated, the holders of the consolidated VIEs’ liabilities generally do not have recourse to the Partnership. The assets and liabilities of the consolidated VIEs that are Consolidated Funds are comprised primarily of investments and loans payable, respectively.

The loans payable issued by the CLOs are backed by diversified collateral asset portfolios consisting primarily of loans or structured debt. In exchange for managing the collateral for the CLOs, the Partnership earns investment management fees, including in some cases subordinated management fees and contingent incentive fees. In cases where the Partnership consolidates the CLOs, those management fees have been eliminated as intercompany transactions. As of March 31, 2015, the Partnership held $169.3 million of investments in these CLOs which represent its maximum risk of loss. The Partnership’s investments in these CLOs are generally subordinated to other interests in the entities and entitle the Partnership to receive a pro rata portion of the residual cash flows, if any, from the entities. Investors in the CLOs have no recourse against the Partnership for any losses sustained in the CLO structure.

For all Carlyle-affiliated funds and co-investment entities (collectively “the funds”) that are not determined to be VIEs, the Partnership consolidates those funds where, as the sole general partner, it has not overcome the presumption of control

10

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

pursuant to U.S. GAAP. Most Carlyle funds provide a dissolution right upon a simple majority vote of the non-Carlyle affiliated limited partners such that the presumption of control by Carlyle is overcome. Accordingly, these funds are not consolidated in the Partnership’s condensed consolidated financial statements.

Investments in Unconsolidated Variable Interest Entities

The Partnership holds variable interests in certain VIEs that are not consolidated because the Partnership is not the primary beneficiary, including its strategic investment in NGP Management Company, L.L.C. (“NGP Management” and, together with its affiliates, “NGP”). Refer to Note 6 for information on this investment. The Partnership’s involvement with such entities is in the form of direct equity interests and fee arrangements. The maximum exposure to loss represents the loss of assets recognized by the Partnership relating to these unconsolidated entities. The assets recognized in the Partnership’s condensed consolidated balance sheets related to the Partnership’s interests in these non-consolidated VIEs and the Partnership’s maximum exposure to loss relating to non-consolidated VIEs were as follows:

	As of
	March 31, 2015		December 31, 2014
	(Dollars in millions)
Investments	$	521.2	$	511.8
Receivables	7.3		3.7
Maximum Exposure to Loss	$	528.5	$	515.5

Basis of Accounting

The accompanying financial statements are prepared in accordance with U.S. GAAP. Management has determined that the Partnership’s Funds are investment companies under U.S. GAAP for the purposes of financial reporting. U.S. GAAP for an investment company requires investments to be recorded at estimated fair value and the unrealized gains and/or losses in an investment’s fair value are recognized on a current basis in the statements of operations. Additionally, the Funds do not consolidate their majority-owned and controlled investments (the “Portfolio Companies”). In the preparation of these condensed consolidated financial statements, the Partnership has retained the specialized accounting for the Funds.

All of the investments held and notes issued by the Consolidated Funds are presented at their estimated fair values in the Partnership’s condensed consolidated balance sheets. Interest and other income of the Consolidated Funds as well as interest expense and other expenses of the Consolidated Funds are included in the Partnership’s condensed consolidated statements of operations. The excess of the CLO assets over the CLO liabilities upon consolidation is reflected in the Partnership’s condensed consolidated balance sheets as partners’ capital appropriated for Consolidated Funds. Net income attributable to the investors in the CLOs is included in net income (loss) attributable to non-controlling interests in consolidated entities in the condensed consolidated statements of operations and partners’ capital appropriated for Consolidated Funds in the condensed consolidated balance sheets.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make assumptions and estimates that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Management’s estimates are based on historical experiences and other factors, including expectations of future events that management believes to be reasonable under the circumstances. It also requires management to exercise judgment in the process of applying the Partnership’s accounting policies. Assumptions and estimates regarding the valuation of investments and their resulting impact on performance fees involve a higher degree of judgment and complexity and these assumptions and estimates may be significant to the consolidated financial statements and the resulting impact on performance fees. Actual results could differ from these estimates and such differences could be material.

11

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

Business Combinations

The Partnership accounts for business combinations using the acquisition method of accounting, under which the purchase price of the acquisition is allocated to the assets acquired and liabilities assumed using the fair values determined by management as of the acquisition date. Contingent consideration obligations that are elements of consideration transferred are recognized as of the acquisition date as part of the fair value transferred in exchange for the acquired business. Acquisition-related costs incurred in connection with a business combination are expensed.

Revenue Recognition

Fund Management Fees

The Partnership provides management services to funds in which it holds a general partner interest or has a management agreement. For corporate private equity, certain global market strategies funds and real assets funds, management fees are calculated based on (a) limited partners’ capital commitments to the funds, (b) limited partners’ remaining capital invested in the funds at cost or at the lower of cost or aggregate remaining fair value, (c) gross assets, excluding cash and cash equivalents or (d) the net asset value (“NAV”) of certain of the funds, less offsets for the non-affiliated limited partners’ share of transaction advisory and portfolio fees earned, as defined in the respective partnership agreements.

Management fees for corporate private equity, closed-end carry funds in the global market strategies segment and real assets funds generally range from 1% to 2% of commitments during the investment period of the relevant fund. Following the expiration or termination of the investment period of such funds, the management fees generally step-down to between 0.6% and 2.0% generally on the lower of cost or fair value of capital invested; however, certain of our managed accounts base management fees at all times on contributions for unrealized investments or the current value of the investment. The Partnership will receive management fees for corporate private equity and real assets funds during a specified period of time, which is generally ten years from the initial closing date, or, in some instances, from the final closing date, but such termination date may be earlier in certain limited circumstances or later if extended for successive one-year periods, typically up to a maximum of two years. Depending upon the contracted terms of investment advisory or investment management and related agreements, these fees are generally called semi-annually in advance and are recognized as earned over the subsequent six month period.

For certain global market strategies funds, management fees are calculated based on assets under management of the funds with generally lower fee rates. Hedge funds typically pay management fees quarterly that generally range from 1.5% to 2.0% of NAV per year. Management fees for the business development companies are due quarterly in arrears at annual rates that range from 0.25% to 1.0% of gross assets, excluding cash and cash equivalents. Management fees for the CLOs and other structured products typically range from 0.15% to 1.0% on the total par amount of assets or the aggregate principal amount of the notes in the CLO and are due quarterly or semi-annually based on the terms and recognized over the respective period. Management fees for the CLOs/structured products and credit opportunities are governed by indentures and collateral management agreements. The Partnership will receive management fees for the CLOs until redemption of the securities issued by the CLOs, which is generally five to ten years after issuance. Open-ended funds typically do not have stated termination dates.

Management fees for our private equity and real estate fund of funds vehicles generally range from 0.3% to 1.0% on the vehicle’s capital commitments during the commitment fee period of the relevant fund or the weighted-average investment period of the underlying funds. Following the expiration of the commitment fee period or weighted-average investment period of such funds, the management fees generally range from 0.3% to 1.0% on the lower of cost or fair value of the capital invested, the net asset value for unrealized investments, or the contributions for unrealized investments. The management fees for our fund of hedge fund vehicles generally range from 0.2% to 1.5% of net asset value. Management fees for our Investment Solutions segment are generally due quarterly and recognized over the related quarter.

The Partnership also provides transaction advisory and portfolio advisory services to the Portfolio Companies, and where covered by separate contractual agreements, recognizes fees for these services when the service has been provided and collection is reasonably assured. Fund management fees includes transaction and portfolio advisory fees of $7.6 million and $7.0 million for the three months ended March 31, 2015 and 2014, respectively, net of any offsets as defined in the respective partnership agreements.

12

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

Performance Fees

Performance fees consist principally of the allocation of profits from certain of the funds to which the Partnership is entitled (commonly known as carried interest). The Partnership is generally entitled to a 20% allocation (or 10% to 20% on external coinvestment vehicles, with some earning no carried interest, or approximately 2% to 10% in the case of most of the Partnership’s fund of funds vehicles) of the net realized income or gain as a carried interest after returning the invested capital, the allocation of preferred returns of generally 8% to 9% and return of certain fund costs (generally subject to catch-up provisions as set forth in the fund limited partnership agreement) from its corporate private equity and real assets funds and closed-end carry funds in the global market strategies segment. Carried interest is recognized upon appreciation of the funds’ investment values above certain return hurdles set forth in each respective partnership agreement. The Partnership recognizes revenues attributable to performance fees based upon the amount that would be due pursuant to the fund partnership agreement at each period end as if the funds were terminated at that date. Accordingly, the amount recognized as performance fees reflects the Partnership’s share of the gains and losses of the associated funds’ underlying investments measured at their then-current fair values. Because of the inherent uncertainty, these estimated values may differ significantly from the values that would have been used had a ready market for the investments existed, and it is reasonably possible that the difference could be material.

Carried interest is ultimately realized when: (i) an underlying investment is profitably disposed of, (ii) certain costs borne by the limited partner investors have been reimbursed, (iii) the fund’s cumulative returns are in excess of the preferred return and (iv) the Partnership has decided to collect carry rather than return additional capital to limited partner investors. Realized carried interest may be required to be returned by the Partnership in future periods if the funds’ investment values decline below certain levels. When the fair value of a fund’s investments remains constant or falls below certain return hurdles, previously recognized performance fees are reversed. In all cases, each fund is considered separately in this regard, and for a given fund, performance fees can never be negative over the life of a fund. If upon a hypothetical liquidation of a fund’s investments at their then-current fair values, previously recognized and distributed carried interest would be required to be returned, a liability is established for the potential giveback obligation. As of March 31, 2015 and December 31, 2014, the Partnership has recognized $176.6 million and $104.4 million, respectively, for giveback obligations.

In addition to its performance fees from its corporate private equity and real assets funds and closed-end carry funds in the global market strategies segment, the Partnership is also entitled to receive performance fees from certain of its global market strategies funds and fund of funds vehicles when the return on assets under management exceeds certain benchmark returns or other performance targets. In such arrangements, performance fees are recognized when the performance benchmark has been achieved, and are included in performance fees in the accompanying condensed consolidated statements of operations.

Investment Income (Loss)

Investment income (loss) represents the unrealized and realized gains and losses resulting from the Partnership’s equity method investments and other principal investments. Equity method investment income (loss) includes the related amortization of the basis difference between the Partnership’s carrying value of its investment and the Partnership’s share of underlying net assets of the investee, as well as the compensation expense associated with compensatory arrangements provided by the Partnership to employees of its equity method investee. Investment income (loss) is realized when the Partnership redeems all or a portion of its investment or when the Partnership receives or is due cash income, such as dividends or distributions. Unrealized investment income (loss) results from changes in the fair value of the underlying investment as well as the reversal of unrealized gain (loss) at the time an investment is realized.

Interest Income

Interest income is recognized when earned. Interest income earned by the Partnership is included in interest and other income in the accompanying condensed consolidated statements of operations. Interest income of the Consolidated Funds was $208.4 million and $221.2 million for the three months ended March 31, 2015 and 2014, respectively, and is included in interest and other income of Consolidated Funds in the accompanying condensed consolidated statements of operations.

Compensation and Benefits

Base Compensation – Base compensation includes salaries, bonuses (discretionary awards and guaranteed amounts), performance payment arrangements and benefits paid and payable to Carlyle employees. Bonuses are accrued over the service period to which they relate.

13

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

Equity-Based Compensation – Compensation expense relating to the issuance of equity-based awards to Carlyle employees is measured at fair value on the grant date. The compensation expense for awards that vest over a future service period is recognized over the relevant service period on a straight-line basis, adjusted for estimated forfeitures of awards not expected to vest. The compensation expense for awards that do not require future service is recognized immediately. Upon the end of the service period, compensation expense is adjusted to account for the actual forfeiture rate. Cash settled equity-based awards are classified as liabilities and are re-measured at the end of each reporting period. The compensation expense for awards that contain performance conditions is recognized when it is probable that the performance conditions will be achieved; in certain instances, such compensation expense may be recognized prior to the grant date of the award.

Equity-based awards issued to non-employees are recognized as general, administrative and other expenses. The grant-date fair value of equity-based awards granted to Carlyle’s non-employee directors is expensed on a straight-line basis over the vesting period. The cost of services received in exchange for an equity-based award issued to consultants is measured at each vesting date, and is not measured based on the grant-date fair value of the award unless the award is vested at the grant date. Equity-based awards that require the satisfaction of future service criteria are recognized over the relevant service period, adjusted for estimated forfeitures of awards not expected to vest, based on the fair value of the award on each reporting date and adjusted for the actual fair value of the award at each vesting date. Accordingly, the measured value of the award will not be finalized until the vesting date.

Performance Fee Related Compensation – A portion of the performance fees earned is due to employees and advisors of the Partnership. These amounts are accounted for as compensation expense in conjunction with the recognition of the related performance fee revenue and, until paid, are recognized as a component of the accrued compensation and benefits liability. Accordingly, upon any reversal of performance fee revenue, the related compensation expense is also reversed. As of March 31, 2015 and December 31, 2014, the Partnership had recorded a liability of $1.8 billion related to the portion of accrued performance fees due to employees and advisors, which was included in accrued compensation and benefits in the accompanying condensed consolidated financial statements.

Income Taxes

Certain of the wholly-owned subsidiaries of the Partnership and the Carlyle Holdings partnerships are subject to federal, state, local and foreign corporate income taxes at the entity level and the related tax provision attributable to the Partnership’s share of this income is reflected in the condensed consolidated financial statements. Based on applicable foreign, state and local tax laws, the Partnership records a provision for income taxes for certain entities. Tax positions taken by the Partnership are subject to periodic audit by U.S. federal, state, local and foreign taxing authorities.

The Partnership accounts for income taxes under the provisions of Accounting Standards Codification (“ASC”) 740, Income Taxes (“ASC 740”), using the liability method. ASC 740 requires the recognition of deferred tax liabilities and assets for the expected future consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial statement reporting and the tax basis of assets and liabilities using enacted tax rates in effect for the period in which the difference is expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in the period of the change in the provision for income taxes. Further, deferred tax assets are recognized for the expected realization of available net operating loss and tax credit carry forwards. A valuation allowance is recorded on the Partnership’s gross deferred tax assets when it is “more likely than not” that such asset will not be realized. When evaluating the realizability of the Partnership’s deferred tax assets, all evidence, both positive and negative, is evaluated. Items considered in this analysis include the ability to carry back losses, the reversal of temporary differences, tax planning strategies, and expectations of future earnings.

Under U.S. GAAP for income taxes, the amount of tax benefit to be recognized is the amount of benefit that is “more likely than not” to be sustained upon examination. The Partnership analyzes its tax filing positions in all of the U.S. federal, state, local and foreign tax jurisdictions where it is required to file income tax returns, as well as for all open tax years in these jurisdictions. If, based on this analysis, the Partnership determines that uncertainties in tax positions exist, a liability is established, which is included in accounts payable, accrued expenses and other liabilities in the condensed consolidated financial statements. The Partnership recognizes accrued interest and penalties related to unrecognized tax positions in the provision for income taxes. If recognized, the entire amount of unrecognized tax positions would be recorded as a reduction in the provision for income taxes.

14

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

Tax Receivable Agreement

Exchanges of Carlyle Holdings partnership units for the Partnership’s common units that are executed by the limited partners of the Carlyle Holdings partnerships result in transfers of and increases in the tax basis of the tangible and intangible assets of Carlyle Holdings, primarily attributable to a portion of the goodwill inherent in the business. These transfers and increases in tax basis will increase (for tax purposes) depreciation and amortization and therefore reduce the amount of tax that certain of the Partnership’s subsidiaries, including Carlyle Holdings I GP Inc., which are referred to as the “corporate taxpayers,” would otherwise be required to pay in the future. This increase in tax basis may also decrease gain (or increase loss) on future dispositions of certain capital assets to the extent tax basis is allocated to those capital assets. The Partnership has entered into a tax receivable agreement with the limited partners of the Carlyle Holdings partnerships whereby the corporate taxpayers have agreed to pay to the limited partners of the Carlyle Holdings partnerships involved in any exchange transaction 85% of the amount of cash tax savings, if any, in U.S. federal, state and local income tax or foreign or franchise tax that the corporate taxpayers realize as a result of these increases in tax basis and, in limited cases, transfers or prior increases in tax basis. The corporate taxpayers expect to benefit from the remaining 15% of cash tax savings, if any, in income tax they realize. Payments under the tax receivable agreement will be based on the tax reporting positions that the Partnership will determine. The corporate taxpayers will not be reimbursed for any payments previously made under the tax receivable agreement if a tax basis increase is successfully challenged by the Internal Revenue Service.

The Partnership records an increase in deferred tax assets for the estimated income tax effects of the increases in tax basis based on enacted federal and state tax rates at the date of the exchange. To the extent that the Partnership estimates that the corporate taxpayers will not realize the full benefit represented by the deferred tax asset, based on an analysis that will consider, among other things, its expectation of future earnings, the Partnership will reduce the deferred tax asset with a valuation allowance and will assess the probability that the related liability owed under the tax receivable agreement will be paid. The Partnership records 85% of the estimated realizable tax benefit (which is the recorded deferred tax asset less any recorded valuation allowance) as an increase to the liability due under the tax receivable agreement, which is included in due to affiliates in the accompanying condensed consolidated financial statements. The remaining 15% of the estimated realizable tax benefit is initially recorded as an increase to the Partnership’s partners’ capital.

All of the effects to the deferred tax asset of changes in any of the Partnership’s estimates after the tax year of the exchange will be reflected in the provision for income taxes. Similarly, the effect of subsequent changes in the enacted tax rates will be reflected in the provision for income taxes.

Non-controlling Interests

Non-controlling interests in consolidated entities represent the component of equity in consolidated entities held by third-party investors. These interests are adjusted for general partner allocations and by subscriptions and redemptions in hedge funds which occur during the reporting period. Any change in ownership of a subsidiary while the controlling financial interest is retained is accounted for as an equity transaction between the controlling and non-controlling interests. Transaction costs incurred in connection with such changes in ownership of a subsidiary are recorded as a direct charge to partners’ capital.

Non-controlling interests related to hedge funds are subject to quarterly or monthly redemption by investors in these funds following the expiration of a specified period of time, or may be withdrawn subject to a redemption fee during the period when capital may not be withdrawn. As limited partners in these types of funds have been granted redemption rights, amounts relating to third-party interests in such consolidated funds are presented as redeemable non-controlling interests in consolidated entities within the condensed consolidated balance sheets. When redeemable amounts become contractually payable to investors, they are classified as a liability and included in other liabilities of Consolidated Funds in the condensed consolidated balance sheets.

Non-controlling interests in Carlyle Holdings relate to the ownership interests of the other limited partners of the Carlyle Holdings partnerships. The Partnership, through wholly-owned subsidiaries, is the sole general partner of Carlyle Holdings.  Accordingly, the Partnership consolidates Carlyle Holdings into its consolidated financial statements, and the other ownership interests in Carlyle Holdings are reflected as non-controlling interests in the Partnership’s condensed consolidated financial statements. Any change to the Partnership’s ownership interest in Carlyle Holdings while it retains the controlling financial interest in Carlyle Holdings is accounted for as a transaction within partners’ capital as a reallocation of ownership interests in Carlyle Holdings.

15

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

Earnings Per Common Unit

The Partnership computes earnings per common unit in accordance with ASC 260, Earnings Per Share (“ASC 260”). Basic earnings per common unit is calculated by dividing net income (loss) attributable to the common units of the Partnership by the weighted-average number of common units outstanding for the period. Diluted earnings per common unit reflects the assumed conversion of all dilutive securities. Net income (loss) attributable to the common units excludes net income (loss) and dividends attributable to any participating securities under the two-class method of ASC 260.

Investments

Investments include (i) the Partnership’s ownership interests (typically general partner interests) in the Funds, (ii) the investments held by the Consolidated Funds (all of which are presented at fair value in the Partnership’s condensed consolidated financial statements), (iii) strategic investments made by the Partnership and (iv) certain credit-oriented investments.

The valuation procedures utilized for investments of the Funds vary depending on the nature of the investment. The fair value of investments in publicly-traded securities is based on the closing price of the security with adjustments to reflect appropriate discounts if the securities are subject to restrictions.

The fair value of non-equity securities or other investments, which may include instruments that are not listed on an exchange, considers, among other factors, external pricing sources, such as dealer quotes or independent pricing services, recent trading activity or other information that, in the opinion of the Partnership, may not have been reflected in pricing obtained from external sources.

When valuing private securities or assets without readily determinable market prices, the Partnership gives consideration to operating results, financial condition, economic and/or market events, recent sales prices and other pertinent information. These valuation procedures may vary by investment but include such techniques as comparable public market valuation, comparable acquisition valuation and discounted cash flow analysis. Because of the inherent uncertainty, these estimated values may differ significantly from the values that would have been used had a ready market for the investments existed, and it is reasonably possible that the difference could be material. Furthermore, there is no assurance that, upon liquidation, the Partnership will realize the values presented herein.

Upon the sale of a security or other investment, the realized net gain or loss is computed on a weighted average cost basis, with the exception of the CLOs, which compute the realized net gain or loss on a first in, first out basis. Securities transactions are recorded on a trade date basis.

Equity-Method Investments

The Partnership accounts for all investments in which it has or is otherwise presumed to have significant influence, including investments in the unconsolidated Funds and strategic investments, using the equity method of accounting. The carrying value of equity-method investments is determined based on amounts invested by the Partnership, adjusted for the equity in earnings or losses of the investee allocated based on the respective partnership agreement, less distributions received. The Partnership evaluates its equity-method investments for impairment whenever events or changes in circumstances indicate that the carrying amounts of such investments may not be recoverable.

Cash and Cash Equivalents

Cash and cash equivalents include cash held at banks and cash held for distributions, including temporary investments with original maturities of less than three months when purchased. Included in cash and cash equivalents is cash withheld from carried interest distributions for potential giveback obligations of $24.0 million and $29.9 million at March 31, 2015 and December 31, 2014, respectively.

Cash and Cash Equivalents Held at Consolidated Funds

Cash and cash equivalents held at Consolidated Funds consists of cash and cash equivalents held by the Consolidated Funds, which, although not legally restricted, is not available to fund the general liquidity needs of the Partnership.

16

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

Restricted Cash

Restricted cash at March 31, 2015 and December 31, 2014 includes $18.7 million and $8.7 million, respectively, of cash received on behalf of certain non-consolidated Carlyle funds that was paid out in April 2015 and January 2015, respectively. Also included in restricted cash at March 31, 2015 and December 31, 2014 is €4.4 million ($4.8 million and $5.4 million as of March 31, 2015 and December 31, 2014, respectively) in escrow related to a tax contingency at one of the Partnership’s real estate funds (see Note 11). Also included in restricted cash at December 31, 2014 was $13.2 million which is no longer restricted at March 31, 2015. The remaining balance in restricted cash at March 31, 2015 and December 31, 2014 primarily represents cash held by the Partnership’s foreign subsidiaries due to certain government regulatory capital requirements.

Restricted Cash and Securities of Consolidated Funds

Certain CLOs receive cash from various counterparties to satisfy collateral requirements on derivative transactions. Cash received to satisfy these collateral requirements of $2.1 million and $2.3 million is included in restricted cash and securities of Consolidated Funds at March 31, 2015 and December 31, 2014, respectively.

Certain CLOs hold U.S. Treasury notes and corporate bonds as collateral for specific classes of loans payable in the CLOs. As of March 31, 2015 and December 31, 2014, securities of $16.7 million and $12.6 million, respectively, are included in restricted cash and securities of Consolidated Funds.

Derivative Instruments

Derivative instruments are recognized at fair value in the condensed consolidated balance sheets with changes in fair value recognized in the condensed consolidated statements of operations for all derivatives not designated as hedging instruments. For all derivatives where hedge accounting is applied, effectiveness testing and other procedures to assess the ongoing validity of the hedges are performed at least quarterly. For instruments designated as cash flow hedges, the Partnership records changes in the estimated fair value of the derivative, to the extent that the hedging relationship is effective, in other comprehensive income (loss). If the hedging relationship for a derivative is determined to be ineffective, due to changes in the hedging instrument or the hedged items, the fair value of the portion of the hedging relationship determined to be ineffective will be recognized as a gain or loss in the condensed consolidated statements of operations.

Fixed Assets

Fixed assets consist of furniture, fixtures and equipment, leasehold improvements, and computer hardware and software and are stated at cost, less accumulated depreciation and amortization. Depreciation is recognized on a straight-line method over the assets’ estimated useful lives, which for leasehold improvements are the lesser of the lease terms or the life of the asset, and three to seven years for other fixed assets. Fixed assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

Intangible Assets and Goodwill

The Partnership’s intangible assets consist of acquired contractual rights to earn future fee income, including management and advisory fees, customer relationships, and acquired trademarks. Finite-lived intangible assets are amortized over their estimated useful lives, which range from three to ten years, and are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable.

Goodwill represents the excess of cost over the identifiable net assets of businesses acquired and is recorded in the functional currency of the acquired entity. Goodwill is recognized as an asset and is reviewed for impairment annually as of October 1st and between annual tests when events and circumstances indicate that impairment may have occurred.

Deferred Revenue

Deferred revenue represents management fees and other revenue received prior to the balance sheet date, which has not yet been earned.

17

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

Comprehensive Income (Loss)

Comprehensive income (loss) consists of net income (loss) and other comprehensive income (loss). The Partnership’s other comprehensive income (loss) is comprised of unrealized gains and losses on cash flow hedges, foreign currency translation adjustments and gains and losses on defined benefit plans sponsored by AlpInvest. The components of accumulated other comprehensive income (loss) as of March 31, 2015 and December 31, 2014 were as follows:

	As of
	March 31, 2015			December 31, 2014
	(Dollars in millions)
Unrealized losses on cash flow hedge instruments	$	(0.8	)	$	(0.9	)
Currency translation adjustments	(47.9		)	(35.8		)
Unrealized losses on defined benefit plans	(1.7		)	(2.3		)
Total	$	(50.4	)	$	(39.0	)

Foreign Currency Translation

Non-U.S. dollar denominated assets and liabilities are translated at period-end rates of exchange, and the condensed consolidated statements of operations are translated at rates of exchange in effect throughout the period. Foreign currency losses resulting from transactions outside of the functional currency of an entity of $15.4 million and $0.6 million for the three months ended March 31, 2015 and 2014, respectively, are included in general, administrative and other expenses in the condensed consolidated statements of operations.

Recent Accounting Pronouncements

On April 7, 2015, the FASB issued ASU 2015-3, Interest - Imputation of Interest (Subtopic 835-30) - Simplifying the Presentation of Debt Issuance Costs. ASU 2015-3 requires debt issuance costs related to a recognized debt liability to be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts and premiums. This guidance is effective for the Partnership on January 1, 2016 and the ASU requires the guidance to be applied on a retrospective basis. This guidance is not expected to have a material impact on the Partnership's consolidated financial statements upon adoption.

On February 18, 2015, the FASB issued ASU 2015-2, Consolidation (Topic 820): Amendments to the Consolidation Analysis. ASU 2015-2 provides a revised consolidation model for all reporting entities to use in evaluating whether they should consolidate certain legal entities. All legal entities will be subject to reevaluation under this revised consolidation model. The revised consolidation model, among other things, (i) modifies the evaluation of whether limited partnerships and similar legal entities are VIEs or voting interest entities, (ii) eliminates the presumption that a general partner should consolidate a limited partnership, and (iii) modifies the consolidation analysis of reporting entities that are involved with VIEs through fee arrangements and related party relationships. This guidance in ASU 2015-2 is effective for the Partnership beginning on January 1, 2016; however, early adoption is permitted. The Partnership is currently assessing the potential impact that this guidance will have on its consolidated financial statements.

In August 2014, the FASB issued ASU 2014-13, Consolidation (Topic 810): Measuring the Financial Assets and the Financial Liabilities of a Consolidated Collateralized Financing Entity. ASU 2014-13 relates to reporting entities that elect to measure all eligible financial assets and financial liabilities of a consolidated collateralized financing entity at fair value. Under the Partnership's current practice, the difference between the fair value of the financial assets and the fair value of the financial liabilities is classified within partners’ capital appropriated for Consolidated Funds. ASU 2014-13 requires the reporting entity to initially measure both the financial assets and financial liabilities using the fair value of the financial assets or financial liabilities, whichever is more observable. As a result, the reporting entity will no longer have a difference to report within appropriated partners’ capital. This guidance is effective for the Partnership on January 1, 2016. The Partnership’s consolidated CLOs are consolidated collateralized financing entities for which the Partnership has measured financial assets and financial liabilities at fair value. The guidance is expected to change the measurement of the financial assets or financial liabilities of the Partnership's consolidated CLOs, which will impact net income but not impact net income attributable to the Partnership. Upon adoption, substantially all the balance within partners' capital appropriated for Consolidated Funds will be reclassified to

18

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

investments of Consolidated Funds or loans payable of Consolidated Funds. At March 31, 2015 partners' capital appropriated for Consolidated Funds was $126.9 million.

In May 2014, the FASB issued ASU 2014-9, Revenue from Contracts with Customers (Topic 606). ASU 2014-9 provides comprehensive guidance for recognizing revenue from contracts with customers. Entities will be able to recognize revenue when the entity transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. The guidance includes a five-step framework that requires an entity to: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when the entity satisfies a performance obligation. The guidance in ASU 2014-9 is effective for the Partnership beginning on January 1, 2017. However, in April 2015, the FASB issued an exposure draft that, if ratified, would delay the implementation by a year. The Partnership is still assessing the potential impact of this guidance, however, this may have a material impact on the Partnership's consolidated financial statements by significantly delaying the recognition of performance fee revenue.

3. Acquisitions

Acquisition of Diversified Global Asset Management Corporation

On February 3, 2014, the Partnership acquired 100% of the equity interests in Diversified Global Asset Management Corporation ("DGAM"), a Toronto, Canada-based alternative investment manager with $2.9 billion in fee-earning assets under management. As of February 3, 2014, DGAM also advised on $3.6 billion in assets, for which it earned a nominal advisory fee. The purchase price consisted of approximately $8.0 million in cash and 662,134 newly issued common units (approximately $23.1 million). The transaction also included contingent compensation of up to $23.7 million in cash and $47.3 million in common units, which are issuable through 2021 upon the achievement of certain performance and service-based requirements. The Partnership consolidated the financial position and results of operations of DGAM effective February 3, 2014 and accounted for this transaction as a business combination. DGAM is the Partnership’s fund of hedge funds platform and is included in the Partnership’s Investment Solutions business segment.

See Note 3 to the consolidated financial statements included in the Partnership’s 2014 Annual Report on Form 10-K for additional information on the DGAM acquisition.

4. Fair Value Measurement

The fair value measurement accounting guidance establishes a hierarchal disclosure framework which ranks the observability of market price inputs used in measuring financial instruments at fair value. The observability of inputs is impacted by a number of factors, including the type of financial instrument, the characteristics specific to the financial instrument and the state of the marketplace, including the existence and transparency of transactions between market participants. Financial instruments with readily available quoted prices, or for which fair value can be measured from quoted prices in active markets, will generally have a higher degree of market price observability and a lesser degree of judgment applied in determining fair value.

Financial instruments measured and reported at fair value are classified and disclosed based on the observability of inputs used in the determination of fair values, as follows:

Level I – inputs to the valuation methodology are quoted prices available in active markets for identical instruments as of the reporting date. The type of financial instruments included in Level I include unrestricted securities, including equities and derivatives, listed in active markets. The Partnership does not adjust the quoted price for these instruments, even in situations where the Partnership holds a large position and a sale could reasonably impact the quoted price.

Level II – inputs to the valuation methodology are other than quoted prices in active markets, which are either directly or indirectly observable as of the reporting date. The type of financial instruments in this category includes less liquid and restricted securities listed in active markets, securities traded in other than active markets, government and agency securities, and certain over-the-counter derivatives where the fair value is based on observable inputs. Investments in hedge funds are classified in this category when their net asset value is redeemable without significant restriction.

Level III – inputs to the valuation methodology are unobservable and significant to overall fair value measurement. The inputs into the determination of fair value require significant management judgment or estimation. Financial instruments that are included in this category include investments in privately-held entities, non-investment grade residual interests in

19

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

securitizations, collateralized loan obligations, and certain over-the-counter derivatives where the fair value is based on unobservable inputs. Investments in fund of funds are generally included in this category.

In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the determination of which category within the fair value hierarchy is appropriate for any given financial instrument is based on the lowest level of input that is significant to the fair value measurement. The Partnership’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the financial instrument.

In certain cases, debt and equity securities are valued on the basis of prices from an orderly transaction between market participants provided by reputable dealers or pricing services. In determining the value of a particular investment, pricing services may use certain information with respect to transactions in such investments, quotations from dealers, pricing matrices, market transactions in comparable investments and various relationships between investments.

The following table summarizes the Partnership’s assets and liabilities measured at fair value on a recurring basis by the above fair value hierarchy levels as of March 31, 2015:

(Dollars in millions)	Level I		Level II		Level III		Total
Assets
Investments of Consolidated Funds:
Equity securities	$	601.1	$	105.6	$	1,393.3	$	2,100.0
Bonds	—		—		1,149.3		1,149.3
Loans	—		—		15,439.4		15,439.4
Partnership and LLC interests(1)	—		—		3,324.8		3,324.8
Hedge funds	—		3,932.3		—		3,932.3
Other	—		—		3.3		3.3
	601.1		4,037.9		21,310.1		25,949.1
Trading securities	—		—		2.2		2.2
Foreign currency forward contracts	—		14.1		—		14.1
Restricted securities of Consolidated Funds	4.1		—		12.6		16.7
Total	$	605.2	$	4,052.0	$	21,324.9	$	25,982.1
Liabilities
Loans payable of Consolidated Funds	$	—	$	—	$	16,554.6	$	16,554.6
Derivative instruments of the CLOs	—		—		27.4		27.4
Contingent consideration(2)	—		—		51.3		51.3
Loans payable of a consolidated real estate VIE	—		—		139.6		139.6
Interest rate swaps	—		2.6		—		2.6
Foreign currency forward contracts	—		8.8		—		8.8
Total	$	—	$	11.4	$	16,772.9	$	16,784.3

(1) Balance represents Fund Investments that the Partnership consolidates one fiscal quarter in arrears.

(2) Related to contingent cash and equity consideration associated with the acquisitions of Claren Road, AlpInvest, ESG, Vermillion and Metropolitan, excluding employment-based contingent consideration (see Note 9).

20

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

The following table summarizes the Partnership’s assets and liabilities measured at fair value on a recurring basis by the above fair value hierarchy levels as of December 31, 2014:

(Dollars in millions)	Level I		Level II		Level III		Total
Assets
Investments of Consolidated Funds:
Equity securities	$	346.8	$	156.8	$	1,968.5	$	2,472.1
Bonds	—		—		1,235.8		1,235.8
Loans	—		—		15,084.9		15,084.9
Partnership and LLC interests(1)	—		—		3,481.0		3,481.0
Hedge funds	—		3,753.5		—		3,753.5
Other	—		—		1.5		1.5
	346.8		3,910.3		21,771.7		26,028.8
Trading securities	—		—		3.3		3.3
Restricted securities of Consolidated Funds	4.0		—		8.6		12.6
Total	$	350.8	$	3,910.3	$	21,783.6	$	26,044.7
Liabilities
Loans payable of Consolidated Funds	$	—	$	—	$	16,052.2	$	16,052.2
Derivative instruments of the CLOs	—		—		17.2		17.2
Contingent consideration(2)	—		—		51.1		51.1
Loans payable of a consolidated real estate VIE	—		—		146.2		146.2
Interest rate swaps	—		3.2		—		3.2
Total	$	—	$	3.2	$	16,266.7	$	16,269.9

(1) Balance represents Fund Investments that the Partnership consolidates one fiscal quarter in arrears.

(2) Related to contingent cash and equity consideration associated with the acquisitions of Claren Road, AlpInvest, ESG, Vermillion and Metropolitan, excluding employment-based contingent consideration (see Note 9).

Transfers from Level II to Level I during the three months ended March 31, 2015 were due to the expiration of transferability restrictions on certain equity securities of Consolidated Funds that were previously classified as Level II. There were no transfers from Level II to Level I during the three months ended March 31, 2014.

Investment professionals with responsibility for the underlying investments are responsible for preparing the investment valuations pursuant to the policies, methodologies and templates prepared by the Partnership’s valuation group, which is a team made up of dedicated valuation professionals reporting to the Partnership’s chief accounting officer. The valuation group is responsible for maintaining the Partnership’s valuation policy and related guidance, templates and systems that are designed to be consistent with the guidance found in ASC 820, Fair Value Measurement. These valuations, inputs and preliminary conclusions are reviewed by the fund accounting teams. The valuations are then reviewed and approved by the respective fund valuation subcommittees, which are comprised of the respective fund head(s), segment head, chief financial officer and chief accounting officer, as well as members of the valuation group. The valuation group compiles the aggregate results and significant matters and presents them for review and approval by the global valuation committee, which is comprised of the Partnership’s co-chief executive officers, co-presidents and co-chief operating officers, chief risk officer, chief financial officer, chief accounting officer, deputy chief investment officers for Corporate Private Equity, the business segment heads, and observed by the chief compliance officer, the director of internal audit and the Partnership's audit committee. Additionally, each quarter a sample of valuations are reviewed by external valuation firms.

In the absence of observable market prices, the Partnership values its investments using valuation methodologies applied on a consistent basis. For some investments little market activity may exist. Management’s determination of fair value is then based on the best information available in the circumstances and may incorporate management’s own assumptions and involves a significant degree of judgment, taking into consideration a combination of internal and external factors, including the appropriate risk adjustments for non-performance and liquidity risks. Investments for which market prices are not observable include private

21

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

investments in the equity of operating companies and real estate properties, and certain debt positions. The valuation technique for each of these investments is described below:

Private Equity and Real Estate Investments – The fair values of private equity investments are determined by reference to projected net earnings, earnings before interest, taxes, depreciation and amortization (“EBITDA”), the discounted cash flow method, public market or private transactions, valuations for comparable companies or sales of comparable assets, and other measures which, in many cases, are unaudited at the time received. The methods used to estimate the fair value of real estate investments include the discounted cash flow method and/or capitalization rate (“cap rate”) analysis. Valuations may be derived by reference to observable valuation measures for comparable companies or transactions (e.g., applying a key performance metric of the investment such as EBITDA or net operating income to a relevant valuation multiple or cap rate observed in the range of comparable companies or transactions), adjusted by management for differences between the investment and the referenced comparables, and in some instances by reference to option pricing models or other similar models. Adjustments to observable valuation measures are frequently made upon the initial investment to calibrate the initial investment valuation to industry observable inputs. Such adjustments are made to align the investment to observable industry inputs for differences in size, profitability, projected growth rates, geography and capital structure if applicable. The adjustments are reviewed with each subsequent valuation to assess how the investment has evolved relative to the observable inputs. Additionally, the investment may be subject to certain specific risks and/or development milestones which are also taken into account in the valuation assessment. Option pricing models and similar tools do not currently drive a significant portion of private equity or real estate valuations and are used primarily to value warrants, derivatives, certain restrictions and other atypical investment instruments.

Credit-Oriented Investments – The fair values of credit-oriented investments are generally determined on the basis of prices between market participants provided by reputable dealers or pricing services. In determining the value of a particular investment, pricing services may use certain information with respect to transactions in such investments, quotations from dealers, pricing matrices, market transactions in comparable investments and various relationships between investments. Specifically, for investments in distressed debt and corporate loans and bonds, the fair values are generally determined by valuations of comparable investments. In some instances, the Partnership may utilize other valuation techniques, including the discounted cash flow method.

CLO Investments and CLO Loans Payable – The Partnership has elected the fair value option to measure the loans payable of the CLOs at fair value, as the Partnership has determined that measurement of the loans payable issued by the CLOs at fair value better correlates with the value of the assets held by the CLOs, which are held to provide the cash flows for the note obligations. The investments of the CLOs are also carried at fair value.

The fair values of the CLO loan and bond assets are primarily based on quotations from reputable dealers or relevant pricing services. In situations where valuation quotations are unavailable, the assets are valued based on similar securities, market index changes, and other factors. The Partnership corroborates quotations from pricing services either with other available pricing data or with its own models. Generally, the loan and bond assets of the CLOs are not actively traded and are classified as Level III.

The fair values of the CLO loans payable and the CLO structured asset positions are determined based on both discounted cash flow analyses and third-party quotes. Those analyses consider the position size, liquidity, current financial condition of the CLOs, the third-party financing environment, reinvestment rates, recovery lags, discount rates and default forecasts and are compared to broker quotations from market makers and third party dealers.

Loans Payable of a Consolidated Real Estate VIE – The Partnership has elected the fair value option to measure the loans payable of a consolidated real estate VIE at fair value. The fair values of the loans are primarily based on discounted cash flows analyses, which consider the liquidity and current financial condition of the consolidated real estate VIE. These loans are classified as Level III.

Fund Investments – The Partnership’s investments in external funds are valued based on its proportionate share of the net assets provided by the third party general partners of the underlying fund partnerships based on the most recent available information which typically has a lag of up to 90 days. The terms of the investments generally preclude the ability to redeem the investment. Distributions from these investments will be received as the underlying assets in the funds are liquidated, the timing of which cannot be readily determined.

22

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

The changes in financial instruments measured at fair value for which the Partnership has used Level III inputs to determine fair value are as follows (Dollars in millions):

	Financial Assets Three Months Ended March 31, 2015
	Investments of Consolidated Funds
	Equity securities			Bonds			Loans			Partnership and LLC interests			Other			Trading securities and other			Restricted securities of Consolidated Funds		Total
Balance, beginning of period	$	1,968.5		$	1,235.8		$	15,084.9		$	3,481.0		$	1.5		$	3.3		$	8.6	$	21,783.6
Purchases	12.7			93.4			1,628.2			70.3			—			—			3.9		1,808.5
Sales	(599.6		)	(68.5		)	(343.2		)	(271.9		)	—			—			—		(1,283.2		)
Settlements	—			—			(440.9		)	—			—			—					(440.9		)
Realized and unrealized gains (losses), net
Included in earnings	188.3			11.9			32.8			191.1			2.0			(1.1		)	0.1		425.1
Included in other comprehensive income	(176.6		)	(123.3		)	(522.4		)	(145.7		)	(0.2		)	—			—		(968.2		)
Balance, end of period	$	1,393.3		$	1,149.3		$	15,439.4		$	3,324.8		$	3.3		$	2.2		$	12.6	$	21,324.9
Changes in unrealized gains (losses) included in earnings related to financial assets still held at the reporting date	$	(90.2	)	$	11.1		$	39.8		$	62.2		$	(11.8	)	$	(1.1	)	$	0.1	$	10.1

	Financial Assets Three Months Ended March 31, 2014
	Investments of Consolidated Funds
	Equity securities			Bonds			Loans			Partnership and LLC  interests			Other			Trading securities and other			Restricted securities of Consolidated Funds			Total
Balance, beginning of period	$	2,714.1		$	1,249.5		$	14,067.8		$	3,815.2		$	2.0		$	6.9		$	8.6		$	21,864.1
Transfers in (1)	4.5			—			—			—			—			—			—			4.5
Transfers out (1)	(87.5		)	—			—			—			—			—			—			(87.5		)
Purchases	14.4			99.0			1,787.0			133.8			—			—			—			2,034.2
Sales	(240.3		)	(138.8		)	(372.5		)	(450.9		)	—			(3.6		)	—			(1,206.1		)
Settlements	—			—			(1,177.8		)	—			—			—			—			(1,177.8		)
Realized and unrealized gains (losses), net
Included in earnings	62.9			14.9			23.0			153.8			(0.6		)	1.9			(0.3		)	255.6
Included in other comprehensive income	16.9			(0.7		)	(2.9		)	71.7			—			—			—			85.0
Balance, end of period	$	2,485.0		$	1,223.9		$	14,324.6		$	3,723.6		$	1.4		$	5.2		$	8.3		$	21,772.0
Changes in unrealized gains (losses) included in earnings related to financial assets still held at the reporting date	$	(88.7	)	$	13.7		$	10.0		$	(105.0	)	$	(0.6	)	$	1.9		$	(0.3	)	$	(169.0	)

(1) Transfers into and out of Level III financial assets were due to changes in the observability of market inputs used in the valuation of such assets. Transfers are measured as of the beginning of the period in which the transfer occurs.

23

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

	Financial Liabilities Three Months Ended March 31, 2015
	Loans Payable of Consolidated Funds			Derivative Instruments of Consolidated Funds			Contingent Consideration			Loans Payable of a consolidated real estate VIE			Total
Balance, beginning of period	$	16,052.2		$	17.2		$	51.1		$	146.2		$	16,266.7
Initial consolidation of funds	664.4			—			—			—			664.4
Borrowings	939.3			—			—			7.8			947.1
Paydowns	(538.5		)	—			(0.5		)	(18.9		)	(557.9		)
Sales	—			(0.8		)	—			—			(0.8		)
Realized and unrealized (gains) losses, net
Included in earnings	55.8			9.0			0.7			13.0			78.5
Included in other comprehensive income	(618.6		)	2.0			—			(8.5		)	(625.1		)
Balance, end of period	$	16,554.6		$	27.4		$	51.3		$	139.6		$	16,772.9
Changes in unrealized (gains) losses included in earnings related to financial liabilities still held at the reporting date	$	46.4		$	(13.9	)	$	0.7		$	13.0		$	46.2

	Financial Liabilities Three Months Ended March 31, 2014
	Loans Payable of Consolidated Funds			Derivative Instruments of Consolidated Funds			Contingent Consideration			Loans Payable of a consolidated real estate VIE			Total
Balance, beginning of period	$	15,220.7		$	13.1		$	178.8		$	122.1		$	15,534.7
Initial consolidation of funds	720.4			—			—			—			720.4
Borrowings	624.6			—			—			9.6			634.2
Paydowns	(949.2		)	—			(72.7		)	(19.1		)	(1,041.0		)
Sales	—			(0.9		)	—			—			(0.9		)
Realized and unrealized losses, net
Included in earnings	69.9			2.5			19.7			10.1			102.2
Included in other comprehensive income	(7.7		)	—			—			2.6			(5.1		)
Balance, end of period	$	15,678.7		$	14.7		$	125.8		$	125.3		$	15,944.5
Changes in unrealized (gains) losses included in earnings related to financial liabilities still held at the reporting date	$	(23.3	)	$	(1.6	)	$	19.1		$	10.1		$	4.3

Realized and unrealized gains and losses included in earnings for Level III investments for trading securities are included in investment income (loss), and such gains and losses for investments of Consolidated Funds and loans payable and derivative instruments of the CLOs are included in net investment gains (losses) of Consolidated Funds in the condensed consolidated statements of operations.

Realized and unrealized gains and losses included in earnings for Level III contingent consideration liabilities are included in other non-operating (income) expenses, and such gains and losses for loans payable of a consolidated real estate VIE are included in interest and other expenses of a consolidated real estate VIE in the condensed consolidated statement of operations.

Gains and losses included in other comprehensive income for all Level III financial asset and liabilities are included in accumulated other comprehensive loss, partner's capital appropriated for Consolidated Funds, non-controlling interests in consolidated entities and non-controlling interests in Carlyle Holdings in the condensed consolidated balance sheets.

24

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

The following table summarizes quantitative information about the Partnership’s Level III inputs as of March 31, 2015:

	Fair Value at		Valuation Technique(s)	Unobservable Input(s)	Range (Weighted Average)
(Dollars in millions)	March 31, 2015
Assets
Investments of Consolidated Funds:
Equity securities	$	1,374.8	Comparable Multiple	LTM EBITDA Multiple	4.8x - 16.6x (11.7x)
	18.5		Consensus Pricing	Indicative Quotes ($ per share)	$0 - $218 ($0)
Bonds	1,149.3		Consensus Pricing	Indicative Quotes (% of Par)	1 - 147 (100)
Loans	15,221.2		Consensus Pricing	Indicative Quotes (% of Par)	0 - 139 (98)
	218.2		Market Yield Analysis	Market Yield	5% - 17% (11%)
Partnership and LLC interests	3,324.8		NAV of Underlying Fund(1)	N/A	N/A
Other	3.3		Counterparty Pricing	Indicative Quotes (% of Notional Amount)	0 - 15 (4)
	21,310.1
Trading securities and other	2.2		Comparable Multiple	LTM EBITDA Multiple	5.7x - 5.7x (5.7x)
Restricted securities of Consolidated Funds	12.6		Consensus Pricing	Indicative Quotes (% of Par)	78 - 88 (84)
Total	$	21,324.9
Liabilities
Loans payable of Consolidated Funds:
Senior secured notes	$	15,264.8	Discounted Cash Flow with Consensus Pricing	Discount Rates	1% - 11% (3%)
				Default Rates	1% - 4% (3%)
				Recovery Rates	60% - 75% (66%)
				Indicative Quotes (% of Par)	35 - 101 (98)
Subordinated notes and preferred shares	1,268.6		Discounted Cash Flow with Consensus Pricing	Discount Rates	8% - 15% (10%)
				Default Rates	1% - 4% (3%)
				Recovery Rates	60% - 75% (67%)
				Indicative Quotes (% of Par)	1 - 123 (63)
Combination notes	21.2		Consensus Pricing	Indicative Quotes (% of Par)	99 - 103 (100)
Loans payable of a consolidated real estate VIE	139.6		Discounted Cash Flow	Discount to Expected Payment	0% - 100% (32%)
				Discount Rate	23% - 33% (26%)
Derivative instruments of Consolidated Funds	27.4		Counterparty Pricing	Indicative Quotes (% of Notional Amount)	7 - 37 (21)
Contingent cash consideration(2)	51.3		Discounted Cash Flow	Assumed % of Total Potential Contingent Payments	0% - 100% (19%)
				Discount Rate	5% - 17% (13%)
Total	$	16,772.9

(1) Represents the Partnership’s investments in funds that are valued using the NAV of the underlying fund.

(2) Related to contingent cash consideration associated with the acquisitions of Claren Road, AlpInvest, ESG, Vermillion, and Metropolitan (see Note 9).

25

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

The following table summarizes quantitative information about the Partnership’s Level III inputs as of December 31, 2014:

	Fair Value at		Valuation Technique(s)	Unobservable Input(s)	Range (Weighted Average)
(Dollars in millions)	December 31, 2014
Assets
Investments of Consolidated Funds:
Equity securities	$	1,783.7	Comparable Multiple	LTM EBITDA Multiple	4.8x- 16.2x (12.1x)
	168.7		Comparable Multiple	Forward EBITDA Multiple	8.4x-8.4x (8.4x)
	16.1		Consensus Pricing	Indicative Quotes ($ per share)	$0 - $246 ($0)
Bonds	1,235.8		Consensus Pricing	Indicative Quotes (% of Par)	1 - 133 (99)
Loans	14,873.4		Consensus Pricing	Indicative Quotes (% of Par)	0 - 126 (98)
	211.5		Market Yield Analysis	Market Yield	5% - 17% (11%)
Partnership and LLC interests	3,481.0		NAV of Underlying Fund(1)	N/A	N/A
Other	1.5		Counterparty Pricing	Indicative Quotes (% of Notional Amount)	0 - 6 (3)
	21,771.7
Trading securities and other	3.0		Comparable Multiple	LTM EBITDA Multiple	5.8x - 5.8x (5.8x)
	0.3		Discounted Cash Flow	Discount Rate	10% - 10% (10%)
Restricted securities of Consolidated Funds	8.6		Consensus Pricing	Indicative Quotes (% of Par)	87 - 87 (87)
Total	$	21,783.6
Liabilities
Loans payable of Consolidated Funds:
Senior secured notes	$	14,757.5	Discounted Cash Flow with Consensus Pricing	Discount Rates	1% - 11% (3%)
				Default Rates	1% - 3% (2%)
				Recovery Rates	63% - 75% (68%)
				Indicative Quotes (% of Par)	35 - 100 (98)
Subordinated notes and preferred shares	1,278.8		Discounted Cash Flow with Consensus Pricing	Discount Rates	8% - 15% (10%)
				Default Rates	1% - 3% (2%)
				Recovery Rates	63% - 75% (68%)
				Indicative Quotes (% of Par)	1 - 132 (63)
Combination notes	15.9		Consensus Pricing	Indicative Quotes (% of Par)	97 - 98 (98)
Loans payable of a consolidated real estate VIE	146.2		Discounted Cash Flow	Discount to Expected Payment	0% - 100% (36%)
				Discount Rate	23% - 33% (26%)
Derivative instruments of Consolidated Funds	17.2		Counterparty Pricing	Indicative Quotes (% of Notional Amount)	2 - 22 (11)
Contingent cash consideration(2)	51.1		Discounted Cash Flow	Assumed % of Total Potential Contingent Payments	0% - 100% (20%)
				Discount Rate	5% - 18% (13%)
Total	$	16,266.7

(1) Represents the Partnership’s investments in funds that are valued using the NAV of the underlying fund.

(2) Related to contingent cash consideration associated with the acquisitions of Claren Road, AlpInvest, ESG, Vermillion and Metropolitan (see Note 9).

26

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

The significant unobservable inputs used in the fair value measurement of the Partnership’s investments in equity securities include EBITDA, indicative quotes and discount rates. Significant decreases in EBITDA multiples or indicative quotes in isolation would result in a significantly lower fair value measurement. Significant increases in discount rates in isolation would result in a significantly lower fair value measurement.

The significant unobservable inputs used in the fair value measurement of the Partnership’s investments in bonds and loans are market yields and indicative quotes. Significant increases in market yields in isolation would result in a significantly lower fair value measurement. Significant decreases in indicative quotes in isolation would result in a significantly lower fair value measurement.

The significant unobservable inputs used in the fair value measurement of the Partnership’s trading securities and other investments include EBITDA multiples and discount rates. Significant decreases in EBITDA multiples in isolation would result in a significantly lower fair value measurement. Significant increases in discount rates in isolation would result in a significantly lower fair value measurement.

The significant unobservable inputs used in the fair value measurement of the Partnership’s restricted securities of Consolidated Funds include indicative quotes. Significant decreases in indicative quotes in isolation would result in a significantly lower fair value measurement.

The significant unobservable inputs used in the fair value measurement of the Partnership’s loans payable of Consolidated Funds are discount rates, default rates, recovery rates and indicative quotes. Significant increases in discount rates or default rates in isolation would result in a significantly lower fair value measurement, while a significant increase in recovery rates and indicative quotes in isolation would result in a significantly higher fair value.

The significant unobservable inputs used in the fair value measurement of the Partnership’s loans payable of a consolidated real estate VIE are discount to expected payment and discount rate. A significant increase in either of these inputs in isolation would result in a significantly lower fair value measurement.

The significant unobservable inputs used in the fair value measurement of the Partnership’s derivative instruments of Consolidated Funds include indicative quotes. Significant decreases in indicative quotes in isolation would result in a significantly lower fair value measurement.

The significant unobservable inputs used in the fair value measurement of the Partnership’s contingent consideration are an assumed percentage of total potential contingent payments and discount rate. A significant decrease in the assumed percentage of total potential contingent payments or increase in discount rate in isolation would result in a significantly lower fair value measurement.

27

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

5. Accrued Performance Fees

The components of accrued performance fees are as follows:

	As of
	March 31, 2015		December 31, 2014
	(Dollars in millions)
Corporate Private Equity	$	2,857.3	$	2,932.6
Global Market Strategies	147.1		129.9
Real Assets	321.7		272.9
Investment Solutions	441.1		460.2
Total	$	3,767.2	$	3,795.6

Approximately 51% and 55% of accrued performance fees at March 31, 2015 and December 31, 2014, respectively, are related to Carlyle Partners V, L.P. and Carlyle Europe Partners III, L.P., two of the Partnership’s Corporate Private Equity funds.

Accrued performance fees are shown gross of the Partnership’s accrued performance fee-related compensation, and accrued giveback obligations (see Note 10), which are separately presented in the condensed consolidated balance sheets. The components of the accrued giveback obligations are as follows:

	As of
	March 31, 2015			December 31, 2014
	(Dollars in millions)
Corporate Private Equity	$	(52.4	)	$	(52.4	)
Real Assets	(124.2		)	(52.0		)
Total	$	(176.6	)	$	(104.4	)

Performance Fees

The performance fees included in revenues are derived from the following segments:

	Three Months Ended March 31,
	2015			2014
	(Dollars in millions)
Corporate Private Equity	$	513.3		$	453.2
Global Market Strategies	18.7			66.1
Real Assets	(8.5		)	16.8
Investment Solutions	49.5			84.4
Total	$	573.0		$	620.5

Approximately 58% ($333.7 million) of performance fees for the three months ended March 31, 2015 are related to Carlyle Partners IV, L.P., Carlyle Partners V, L.P. and Carlyle Europe Partners III, L.P., three of the Partnership’s Corporate Private Equity funds, and Carlyle/Riverstone Global Energy and Power Fund III, L.P., one of the Partnership's Real Assets funds. Total revenues recognized from Carlyle Partners IV, L.P., Carlyle Partners V, L.P. and Carlyle Europe Partners III, L.P. were $83.8 million, $175.6 million and $173.7 million, respectively, for the three months ended March 31, 2015. For the three months ended March 31, 2015, total revenue from Carlyle/Riverstone Global Energy and Power Fund III, L.P. was $(64.8) million.

28

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

Approximately 67% ($413.1 million) of performance fees for the three months ended March 31, 2014, respectively, were related to Carlyle Partners V, L.P., and Carlyle Europe Partners III, L.P. Total revenues recognized from Carlyle Partners V, L.P., and Carlyle Europe Partners III, L.P. were $270.6 million and $184.6 million, respectively, for the three months ended March 31, 2014.

6. Investments

Investments consist of the following:

	As of
	March 31, 2015		December 31, 2014
	(Dollars in millions)
Equity method investments, excluding accrued performance fees	$	917.2	$	918.7
Trading securities and other investments	27.0		12.9
Total investments	$	944.2	$	931.6

Strategic Investment in NGP

On December 20, 2012, the Partnership entered into separate purchase agreements with ECM Capital, L.P. and Barclays Natural Resource Investments, a division of Barclays Bank PLC (“BNRI”), pursuant to which the Partnership agreed to invest in NGP Management Company, L.L.C. (“NGP Management” and, together with its affiliates, “NGP”). NGP is an Irving, Texas-based energy investor.

The Partnership’s equity interests in NGP Management entitle the Partnership to an allocation of income equal to 55.0% of the management fee-related revenues of the NGP entities that serve as the advisors to certain private equity funds, and future interests in the general partners of certain future carry funds advised by NGP that entitle the Partnership to an allocation of income equal to 47.5% of the carried interest received by such fund general partners. For periods prior to 2015, the Partnership's allocation of income related to management fee-related revenues of NGP was 47.5%. This increase in the allocation of income did not result in a change in accounting for the investment as an equity method investment. The Partnership has an option, exercisable by the Partnership in approximately 10 years, to purchase from ECM Capital, L.P. and its affiliates, for a formulaic purchase price in cash based upon a measure of the earnings of NGP, the remaining equity interests in NGP Management.

In July 2014, the Partnership exercised another option granted in 2012 to acquire from BNRI its interests in the general partner of NGP X, which entitles the Partnership to an allocation of income equal to 40% of the carried interest received by the fund’s general partner. The Partnership additionally acquired certain general partner investments in the NGP X fund. As of March 31, 2015 and December 31, 2014, the carrying value of the Partnership's investment in the NGP X general partner attributable to the carried interest allocation was approximately $3.9 million and $18.5 million, respectively, and the carrying value of the Partnership's general partner investments in the NGP X fund were $21.3 million and $20.4 million, respectively.

In consideration for these interests and option, the Partnership paid an aggregate of $504.6 million in cash to ECM Capital, L.P. and BNRI, and issued 996,572 Carlyle Holdings partnership units to ECM Capital, L.P. that vest ratably over a period of five years. The transaction also includes contingent consideration payable to ECM Capital, L.P. of up to $45.0 million in cash, 597,944 Carlyle Holdings partnership units that were issued at closing but vest upon the achievement of performance conditions, and contingently issuable Carlyle Holdings partnership units up to $15.0 million that will be issued if the performance conditions are met. The contingent consideration is payable from 2015 through 2018, depending on NGP’s achievement of certain business performance goals. Additionally, the transaction includes contingent consideration payable to BNRI of up to $183.0 million, which will be payable in 2016 approximately one-third in cash and approximately two-thirds by a six year promissory note issued by the Partnership, if the performance conditions are met. The promissory note will accrue interest at the three month LIBOR plus 2.5%.

As of March 31, 2015, the NGP Natural Resources XI, L.P. fund (“NGP XI”) had closed on aggregate commitments of approximately $5.3 billion. The management fees for this fund will turn on over the next year or sooner as the fund deploys capital. Based on the amount of NGP XI commitments raised through March 31, 2015, it is probable that BNRI will be entitled

29

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

to receive the contingent consideration when such payment becomes due. Accordingly, as of March 31, 2015, the Partnership has accrued $183.0 million related to this future payment obligation. The timing of the cash payment and issuance of the promissory note to BNRI is based on the contractual agreement between the Partnership and BNRI, which is estimated to be in early 2016.

The Partnership also has a senior advisor consulting agreement with the chief executive officer of NGP and granted in 2012 deferred restricted common units to a group of NGP personnel who are providing the Partnership with consulting services.

The Partnership accounts for its investment in NGP Management under the equity method of accounting. The Partnership recorded its investment in NGP Management initially at cost, excluding any elements in the transaction that were deemed to be compensatory arrangements to NGP personnel. The Carlyle Holdings partnership units issued in the transaction, the contingently issuable Carlyle Holdings partnership units, and the deferred restricted common units were deemed to be compensatory arrangements; these elements are recognized as an expense under applicable U.S. GAAP.

The Partnership records investment income (loss) for its equity income allocation from NGP management fees and performance fees, and also records its share of any allocated expenses from NGP Management, expenses associated with the compensatory elements of the transaction, and the amortization of the basis differences related to the definitive-lived identifiable intangible assets of NGP Management. The net investment earnings (loss) recognized in the Partnership’s condensed consolidated statements of operations for the three months ended March 31, 2015 and 2014 were as follows:

	Three Months Ended March 31,
	2015			2014
	(Dollars in millions)
Management fees	$	14.3		$	14.4
Performance fees	(14.5		)	—
Investment income (loss)	(0.2		)	—
Expenses and amortization of basis differences	(18.1		)	(18.7		)
Net investment income (loss)	$	(18.5	)	$	(4.3	)

The difference between the Partnership’s carrying value of its investment and its share of the underlying net assets of the investee was $127.4 million and $141.6 million as of March 31, 2015 and December 31, 2014, respectively; these differences are amortized over a period of 10 years from the initial investment date.

Equity-Method Investments

The Partnership’s equity method investments include its fund investments in Corporate Private Equity, Global Market Strategies and Real Assets, typically as general partner interests, and its investment in NGP Management (included within Real Assets), which are not consolidated. Investments are related to the following segments:

	As of
	March 31, 2015		December 31, 2014
	(Dollars in millions)
Corporate Private Equity	$	251.3	$	246.3
Global Market Strategies	25.3		25.3
Real Assets	640.6		647.1
Total	$	917.2	$	918.7

The Partnership evaluates each of its equity method investments to determine if disclosure of summarized income statement information is required under Article 10 of Regulation S-X. As of March 31, 2015 and for the three months then

30

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

ended, no individual equity method investment held by the Partnership met the threshold for disclosure of summarized income statement information.

Investment Income (Loss)

The components of investment income (loss) are as follows:

	Three Months Ended March 31,
	2015			2014
	(Dollars in millions)
Income from equity investments	$	8.8		$	4.0
Income (loss) from trading securities	(2.6		)	1.9
Other investment income	0.6			0.2
Total	$	6.8		$	6.1

Carlyle’s income (loss) from its equity-method investments is included in investment income (loss) in the condensed consolidated statements of operations and consists of:

	Three Months Ended March 31,
	2015			2014
	(Dollars in millions)
Corporate Private Equity	$	23.8		$	17.0
Global Market Strategies	0.7			—
Real Assets	(15.7		)	(13.0		)
Total	$	8.8		$	4.0

Trading Securities and Other Investments

Trading securities and other investments as of March 31, 2015 and December 31, 2014 primarily consisted of $27.0 million and $12.9 million, respectively, of investments in derivative instruments and corporate mezzanine securities and bonds, as well as other cost method investments.

Investments of Consolidated Funds

During the three months ended March 31, 2015, the Partnership formed two new CLOs. The Partnership has concluded that these CLOs are VIEs and the Partnership is the primary beneficiary. As a result, the Partnership consolidated the financial positions and results of operations of these CLOs into its condensed consolidated financial statements beginning on their respective closing dates. As of March 31, 2015, the total assets of these CLOs included in the Partnership’s condensed consolidated financial statements were approximately $1.8 billion.

There were no individual investments with a fair value greater than five percent of the Partnership’s total assets for any period presented.

31

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

Interest and Other Income of Consolidated Funds

The components of interest and other income of Consolidated Funds are as follows:

	Three Months Ended March 31,
	2015		2014
	(Dollars in millions)
Interest income from investments	$	208.4	$	221.2
Other income	17.9		29.5
Total	$	226.3	$	250.7

Net Investment Gains (Losses) of Consolidated Funds

Net investment gains (losses) of Consolidated Funds include net realized gains (losses) from sales of investments and unrealized gains (losses) resulting from changes in fair value of the Consolidated Funds’ investments. The components of net investment gains (losses) of Consolidated Funds are as follows:

	Three Months Ended March 31,
	2015			2014
	(Dollars in millions)
Gains from investments of Consolidated Funds	$	560.5		$	488.9
Losses from liabilities of CLOs	(55.5		)	(65.1		)
Gains on other assets of CLOs	0.5			0.2
Total	$	505.5		$	424.0

The following table presents realized and unrealized gains (losses) earned from investments of the Consolidated Funds:

	Three Months Ended March 31,
	2015		2014
	(Dollars in millions)
Realized gains	$	224.6	$	732.3
Net change in unrealized gains (losses)	335.9		(243.4		)
Total	$	560.5	$	488.9

7. Intangible Assets and Goodwill

The following table summarizes the carrying amount of intangible assets as of March 31, 2015 and December 31, 2014:

	As of
	March 31, 2015			December 31, 2014
	(Dollars in millions)
Acquired contractual rights	$	832.1		$	843.0
Acquired trademarks	6.6			6.7
Accumulated amortization	(485.2		)	(455.1		)
Finite-lived intangible assets, net	353.5			394.6
Goodwill	45.8			47.5
Intangible assets, net	$	399.3		$	442.1

The following table summarizes the changes in the carrying amount of goodwill by segment as of March 31, 2015. There was no goodwill associated with the Partnership’s Corporate Private Equity and Real Assets segments.

32

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

	Global Market Strategies		Investment Solutions			Total
	(Dollars in millions)
Balance as of December 31, 2014	$	28.0	$	19.5		$	47.5
Foreign currency translation	—		(1.7		)	(1.7		)
Balance as of March 31, 2015	$	28.0	$	17.8		$	45.8

During the three months ended March 31, 2015 and 2014, the Partnership evaluated for impairment certain intangible assets associated with acquired contractual rights for fee income based on revisions to the related expected future cash flow. The intangible assets are included in the Global Market Strategies segment. The Partnership recorded an impairment loss of $11.8 million and $24.6 million during the three months ended March 31, 2015 and 2014, respectively, to reduce the carrying value of the intangible assets to their estimated fair value. Fair value was based on a probability-weighted discounted cash flow model. This fair value measurement was based on significant inputs not observable in the market and thus represented a Level III measurement as defined in the accounting guidance for fair value measurements. The impairment loss was included in general, administrative and other expenses in the accompanying condensed consolidated financial statements.

Intangible asset amortization expense, excluding impairment losses, was $22.4 million and $27.5 million for the three months ended March 31, 2015 and 2014, respectively, and is included in general, administrative, and other expenses in the condensed consolidated statements of operations.

The following table summarizes the expected amortization expense for April 1, 2015 through 2019 and thereafter (Dollars in millions):

2015	$	61.0
2016	68.7
2017	65.6
2018	58.5
2019	48.4
Thereafter	51.3
	$	353.5

8. Borrowings

The Partnership borrows and enters into credit agreements for its general operating and investment purposes. The Partnership’s borrowings consist of the following (Dollars in millions):

	As of March 31, 2015				As of December 31, 2014
	Borrowing Outstanding		Carrying Value		Borrowing Outstanding		Carrying Value
Term Loan Due 8/09/2018	$	25.0	$	25.0	$	25.0	$	25.0
Term Loan (1)	13.4		13.4		15.2		15.2
3.875% Senior Notes Due 2/01/2023	500.0		499.9		500.0		499.9
5.625% Senior Notes Due 3/30/2043	600.0		606.8		600.0		606.8
	$	1,138.4	$	1,145.1	$	1,140.2	$	1,146.9

(1) Due the earlier of September 28, 2018 or the date that the CLO is dissolved.

Senior Credit Facility

As of March 31, 2015, the senior credit facility included $500.0 million in a term loan and $750.0 million in a revolving credit facility. As of March 31, 2015, the term loan and revolving credit facility were scheduled to mature on August 9, 2018; however, they were amended as described below on May 5, 2015. Principal amounts outstanding under the term loan and

33

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

revolving credit facility accrue interest, at the option of the borrowers, either (a) at an alternate base rate plus an applicable margin not to exceed 0.75%, or (b) at LIBOR plus an applicable margin not to exceed 1.75% (at March 31, 2015, the interest rate was 1.43%). Interest expense under the senior credit facility was not significant for the three months ended March 31, 2015 and 2014. The fair value of the outstanding balances of the term loan and revolving credit facility at March 31, 2015 and December 31, 2014 approximated par value based on current market rates for similar debt instruments and are classified as Level III within the fair value hierarchy.

On May 5, 2015, the Partnership entered into Amendment No. 2 to the senior credit facility, which: (i) extends the maturity date of the term loan and revolving credit facility from August 9, 2018 to May 5, 2020, (ii) revises the management fee earning assets covenant to remove the step up requirement to add a percentage of future acquired AUM and to set the minimum management fee earning assets amount, (iii) changes the definition of Indebtedness to provide for a deduction of unrestricted cash, and (iv) reduces the corporate ratings-based pricing grid.

Other Borrowings

On October 3, 2013, the Partnership borrowed €12.6 million ($13.4 million at March 31, 2015) under a new term loan and security agreement with a financial institution. Proceeds from the borrowing were used to fund the Partnership’s investment in a CLO. Interest on the term loan accrues at EURIBOR plus 1.75% (1.77% at March 31, 2015). The Partnership may prepay the facility in whole or in part at any time without penalty. The facility is scheduled to mature on the earlier of 5 years after closing or the date that the CLO is dissolved. The facility is secured by the Partnership’s investment in the CLO. Interest expense on the term loan was not significant for the three months ended March 31, 2015 and 2014. The fair value of the outstanding balance of the term loan at March 31, 2015 and December 31, 2014 approximated par value based on current market rates for similar debt instruments and is classified as Level III within the fair value hierarchy.

3.875% Senior Notes

In January 2013, an indirect finance subsidiary of the Partnership issued $500.0 million in aggregate principal amount of 3.875% senior notes due February 1, 2023 at 99.966% of par. Interest is payable semi-annually on February 1 and August 1, beginning August 1, 2013. This subsidiary may redeem the senior notes in whole at any time or in part from time to time at a price equal to the greater of 100% of the principal amount of the notes being redeemed and the sum of the present values of the remaining scheduled payments of principal and interest on any notes being redeemed discounted to the redemption date on a semi-annual basis at the Treasury rate plus 30 basis points plus accrued and unpaid interest on the principal amounts being redeemed to the redemption date.

Interest expense on the notes was $5.0 million for the three months ended March 31, 2015 and 2014. At March 31, 2015 and December 31, 2014, the fair value of the notes was approximately $521.7 million and $513.1 million, respectively, based on indicative quotes. The notes are classified as Level II within the fair value hierarchy.

5.625% Senior Notes

In March 2013, an indirect finance subsidiary of the Partnership issued $400.0 million in aggregate principal amount of 5.625% senior notes due March 30, 2043 at 99.583% of par. Interest is payable semi-annually on March 30 and September 30, beginning September 30, 2013. This subsidiary may redeem the senior notes in whole at any time or in part from time to time at a price equal to the greater of 100% of the principal amount of the notes being redeemed and the sum of the present values of the remaining scheduled payments of principal and interest on any notes being redeemed discounted to the redemption date on a semi-annual basis at the Treasury rate plus 40 basis points plus accrued and unpaid interest on the principal amounts being redeemed to the redemption date.

In March 2014, an indirect finance subsidiary of the Partnership issued $200.0 million of 5.625% Senior Notes due March 30, 2043 at 104.315% of par. The net proceeds from the issuance of these notes are being used for general corporate purposes, including investments in Carlyle’s funds as well as investment capital for acquisitions of new fund platforms and strategies or other growth initiatives, to drive innovation across the broader Carlyle platform. These notes were issued as additional 5.625% Senior Notes and will be treated as a single class with the already outstanding $400.0 million aggregate principal amount of these senior notes.

34

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

Interest expense on the notes was $8.4 million and $6.3 million for the three months ended March 31, 2015 and 2014, respectively. At March 31, 2015 and December 31, 2014, the fair value of the notes was approximately $682.6 million and $699.2 million, respectively, based on indicative quotes. The notes are classified as Level II within the fair value hierarchy.

Interest Rate Swaps

The Partnership is subject to interest rate risk associated with its variable rate debt financing. To manage this risk, the Partnership has an outstanding interest rate swap to fix the base LIBOR interest rate on its term loan borrowings with a notional amount of $381.3 million at March 31, 2015 that amortizes through September 30, 2016.

In the first quarter of 2013, $475.0 million of term loan principal was prepaid. As a result of these term loan prepayments, the interest rate swap is no longer accounted for as a cash flow hedge; the interest rate swap is accounted for as a freestanding derivative instrument recorded at fair value each period with changes in fair value recorded through earnings. The pre-existing hedge loss included in accumulated other comprehensive loss for this interest rate swap of $8.8 million is being reclassified into earnings as the original forecasted transactions affect earnings.

In March 2013, the Partnership entered into a second interest rate swap with a notional amount of $356.3 million at March 31, 2015 that amortizes through September 30, 2016. This interest rate swap is accounted for as a freestanding derivative instrument recorded at fair value each period with changes in fair value recorded through earnings.

Debt Covenants

The Partnership is subject to various financial covenants under its loan agreements including, among other items, maintenance of a minimum amount of management fee-earning assets. The Partnership is also subject to various non-financial covenants under its loan agreements and the indentures governing its senior notes. The Partnership was in compliance with all financial and non-financial covenants under its various loan agreements as of March 31, 2015.

The consolidated real estate VIE was not in compliance with the debt covenants related to substantially all of its loans payable as of March 31, 2015 (see Note 17); such violations do not cause a default or event of default under the Partnership’s senior credit facility, 2013 term loan, senior notes, or the loans payable of Consolidated Funds.

Loans Payable of Consolidated Funds

Loans payable of Consolidated Funds represent amounts due to holders of debt securities issued by the CLOs. Several of the CLOs issued preferred shares representing the most subordinated interest, however these tranches are mandatorily redeemable upon the maturity dates of the senior secured loans payable, and as a result have been classified as liabilities and are included in loans payable of Consolidated Funds in the condensed consolidated balance sheets.

As of March 31, 2015 and December 31, 2014, the following borrowings were outstanding, which includes preferred shares classified as liabilities (Dollars in millions):

	As of March 31, 2015
	Borrowing Outstanding		Fair Value		Weighted Average Interest Rate			Weighted Average Remaining Maturity in Years
Senior secured notes	$	15,528.1	$	15,264.8	1.70	%	%	9.17
Subordinated notes and preferred shares	1,238.2		1,268.6		N/A		(a)	8.21
Combination notes	20.0		21.2		N/A		(b)	8.19
Total	$	16,786.3	$	16,554.6

35

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

	As of December 31, 2014
	Borrowing Outstanding		Fair Value		Weighted Average Interest Rate			Weighted Average Remaining Maturity in Years
Senior secured notes	$	15,104.2	$	14,757.5	1.68	%	%	9.21
Subordinated notes and preferred shares	1,242.3		1,278.8		N/A		(a)	8.28
Combination notes	15.0		15.9		N/A		(b)	7.14
Total	$	16,361.5	$	16,052.2

(a) The subordinated notes and preferred shares do not have contractual interest rates, but instead receive distributions from the excess cash flows of the CLOs.

(b) The combination notes do not have contractual interest rates and have recourse only to the securities specifically held to collateralize such combination notes.

Loans payable of the CLOs are collateralized by the assets held by the CLOs and the assets of one CLO may not be used to satisfy the liabilities of another. This collateral consisted of cash and cash equivalents, corporate loans, corporate bonds and other securities. As of March 31, 2015 and December 31, 2014, the fair value of the CLO assets was $18.2 billion and $17.6 billion, respectively.

9. Contingent Consideration

The Partnership has contingent consideration obligations related to its business acquisitions and strategic investments. The changes in the contingent consideration liabilities are as follows:

	Rollforward For The Three Months Ended March 31, 2015
	Amounts payable to the sellers who are Carlyle professionals
	Performance-based contingent cash consideration			Performance-based contingent equity consideration		Employment-based contingent consideration			Contingent cash and other consideration payable to non- Carlyle personnel				Total
	(Dollars in millions)
Balance at December 31, 2014	$	26.8		$	—	$	156.8		$	201.0			$	384.6
Change in carrying value	0.7			—		(9.5		)	25.6			(a)	16.8
Payments	—			—		(3.3		)	(0.5		)		(3.8		)
Issuances of equity	—			—		(2.2		)	—				(2.2		)
Balance at March 31, 2015	$	27.5		$	—	$	141.8		$	226.1			$	395.4
	Rollforward For The Three Months Ended March 31, 2014
	Amounts payable to the sellers who are senior Carlyle professionals												Total
	Performance-based contingent cash consideration			Performance-based contingent equity consideration		Employment-based contingent consideration			Contingent cash and other consideration payable to non- Carlyle personnel
	(Dollars in millions)
Balance at December 31, 2013	$	145.1		$	15.7	$	148.7		$	40.8			$	350.3
Change in carrying value	17.0			10.6		13.1			5.2				45.9
Payments	(70.5		)	—		—			(2.2		)		(72.7		)
Balance at March 31, 2014	$	91.6		$	26.3	$	161.8		$	43.8			$	323.5

(a) - Refer to Note 6 for information on the contingent consideration payable to BNRI from the strategic investment in NGP.

The fair value of the performance-based contingent cash and equity consideration payable to the sellers who are Carlyle professionals has been recorded in due to affiliates in the accompanying condensed consolidated balance sheets. These payments are not contingent upon the Carlyle professional being employed by Carlyle at the time that the performance conditions are met. Changes in the fair value of these amounts are recorded in other non-operating (income) expenses in the

36

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

condensed consolidated statements of operations. The portion of the contingent consideration payment attributable to the initial amount recorded as part of the consideration transferred is classified as cash flows from financing activities. The portion of the contingent consideration payment that is attributable to the subsequent changes in the fair value of the contingent consideration is classified as cash flows from operating activities in the condensed consolidated statements of cash flows.

The amount of employment-based contingent cash consideration payable to the sellers who are Carlyle professionals has been recorded as accrued compensation and benefits in the accompanying condensed consolidated balance sheets. Changes in the value of these amounts are recorded as compensation expense in the condensed consolidated statements of operations.

The fair value of contingent consideration payable to non-Carlyle personnel is included in accounts payable, accrued expenses and other liabilities, or due to affiliates for amounts payable to NGP, in the accompanying condensed consolidated balance sheets. Changes in the fair value of this contingent consideration are recorded in other non-operating (income) expenses, or investment income in the case of amounts payable to NGP, in the condensed consolidated statements of operations. Included in the change in carrying value for the three months ended March 31, 2015 is $23.2 million related to the accrual of additional contingent consideration payable to BNRI (See Note 6). This amount was capitalized into the carrying value of the Partnership's equity method investment in NGP.

The fair values of the performance-based contingent cash consideration for business acquisitions were based on probability-weighted discounted cash flow models. These fair value measurements are based on significant inputs not observable in the market and thus represent Level III measurements as defined in the accounting guidance for fair value measurement. Refer to Note 4 for additional disclosures related to the fair value of these instruments as of March 31, 2015 and December 31, 2014.

The following table represents the maximum amounts that could be paid from contingent cash obligations associated with the business acquisitions and the strategic investment in NGP Management: 

	As of March 31, 2015
	Business Acquisitions		NGP Investment		Total		Liability Recognized on Financial Statements (1)
			(Dollars in millions)
Performance-based contingent cash consideration	$	231.8	$	183.0	$	414.8	$	253.6
Employment-based contingent cash consideration	255.0		45.0		300.0		141.8
Total maximum cash obligations	$	486.8	$	228.0	$	714.8	$	395.4

(1) On the condensed consolidated balance sheet, the liability for performance-based contingent cash consideration is included in due to affiliates (for amounts owed to Carlyle professionals and NGP) and accounts payable, accrued expenses, and other liabilities (for amounts owed to other sellers), and the liability for employment-based contingent cash consideration is included in accrued compensation and benefits.

Some of the employment-based contingent cash consideration agreements do not contain provisions limiting the amount that could be paid by the Partnership. For purposes of the table above, the Partnership has used its current estimate of the amount to be paid upon the determination dates for such payments. In the consolidated financial statements, the Partnership records the performance-based contingent cash consideration from business acquisitions at fair value at each reporting period. For the employment-based contingent cash consideration, the Partnership accrues the compensation liability over the implied service period.

37

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

10. Accrued Compensation and Benefits

Accrued compensation and benefits consist of the following:

	As of
	March 31, 2015		December 31, 2014
	(Dollars in millions)
Accrued performance fee-related compensation	$	1,808.4	$	1,815.4
Accrued bonuses	127.7		229.6
Employment-based contingent cash consideration	141.8		156.8
Other	124.1		110.7
Total	$	2,202.0	$	2,312.5

11. Commitments and Contingencies

Capital Commitments

The Partnership and its unconsolidated affiliates have unfunded commitments to entities within the following segments as of March 31, 2015 (Dollars in millions):

	Unfunded Commitments
Corporate Private Equity	$	2,013.1
Global Market Strategies	364.4
Real Assets	732.9
Investment Solutions	36.9
	$	3,147.3

Of the $3.1 billion of unfunded commitments, approximately $2.8 billion is subscribed individually by senior Carlyle professionals, operating executives and other professionals, with the balance funded directly by the Partnership. In addition to these unfunded commitments, the Partnership may from time to time exercise its right to purchase additional interests in its investment funds that become available in the ordinary course of their operations.

Guaranteed Loans

On August 4, 2001, the Partnership entered into an agreement with a financial institution pursuant to which the Partnership is the guarantor on a credit facility for eligible employees investing in Carlyle sponsored funds. This credit facility renews on an annual basis, allowing for annual incremental borrowings up to an aggregate of $11.3 million, and accrues interest at the lower of the prime rate, as defined, or three-month LIBOR plus 2%, reset quarterly (3.25% weighted-average rate at March 31, 2015). As of March 31, 2015 and December 31, 2014, approximately $7.8 million and $7.9 million, respectively, were outstanding under the credit facility and payable by the employees. The amount funded by the Partnership under this guarantee as of March 31, 2015 was not material. The Partnership believes the likelihood of any material funding under this guarantee to be remote. The fair value of this guarantee is not significant to the consolidated financial statements.

Contingent Obligations (Giveback)

A liability for potential repayment of previously received performance fees of $176.6 million at March 31, 2015, is shown as accrued giveback obligations in the condensed consolidated balance sheets, representing the giveback obligation that would need to be paid if the funds were liquidated at their current fair values at March 31, 2015. However, the ultimate giveback obligation, if any, does not become realized until the end of a fund’s life (see Note 2). The Partnership has recorded $28.4 million and $27.7 million of unbilled receivables from former and current employees and senior Carlyle professionals as of March 31, 2015 and December 31, 2014, respectively, related to giveback obligations, which are included in due from

38

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

affiliates and other receivables, net in the accompanying condensed consolidated balance sheets. Current and former senior Carlyle professionals and employees are personally responsible for their giveback obligations. The receivables are collateralized by investments made by individual senior Carlyle professionals and employees in Carlyle-sponsored funds. In addition, $322.8 million and $336.5 million have been withheld from distributions of carried interest to senior Carlyle professionals and employees for potential giveback obligations as of March 31, 2015 and December 31, 2014, respectively. Such amounts are held by an entity not included in the accompanying condensed consolidated balance sheets.

If, at March 31, 2015, all of the investments held by the Partnership’s Funds were deemed worthless, a possibility that management views as remote, the amount of realized and distributed carried interest subject to potential giveback would be $1.4 billion, on an after-tax basis where applicable.

Leases

The Partnership leases office space in various countries around the world and maintains its headquarters in Washington, D.C., where it leases its primary office space under a non-cancelable lease agreement expiring on July 31, 2026. Office leases in other locations expire in various years from 2015 through 2031. These leases are accounted for as operating leases. Rent expense was approximately $14.5 million and $12.9 million for the three months ended March 31, 2015 and 2014, respectively, and is included in general, administrative and other expenses in the condensed consolidated statements of operations.

The future minimum commitments for the leases are as follows (Dollars in millions):

2015	$	39.3
2016	51.5
2017	47.7
2018	43.7
2019	38.4
Thereafter	229.6
	$	450.2

The Partnership records contractual escalating minimum lease payments on a straight-line basis over the term of the lease. Deferred rent payable under the leases was $43.2 million and $40.4 million as of March 31, 2015 and December 31, 2014, respectively, and is included in accounts payable, accrued expenses and other liabilities in the accompanying condensed consolidated balance sheets.

Legal Matters

In the ordinary course of business, the Partnership is a party to litigation, investigations, disputes and other potential claims. Certain of these matters are described below. The Partnership is not currently able to estimate the reasonably possible amount of loss or range of loss for the matters that have not been resolved. The Partnership does not believe it is probable that the outcome of any existing litigation, investigations, disputes or other potential claims will materially affect the Partnership or these financial statements. The Partnership believes that the matters described below are without merit and intends to vigorously contest all such allegations for the matters that have not been resolved.

On February 14, 2008, a private class-action lawsuit challenging “club” bids and other alleged anti-competitive business practices was filed in the U.S. District Court for the District of Massachusetts (Police and Fire Retirement System of the City of Detroit v. Apollo Global Management, LLC, later renamed Kirk Dahl v. Bain Capital Partners LLC). The complaint alleges, among other things, that certain global alternative asset firms, including the Partnership, violated Section 1 of the Sherman Act by forming multi-sponsor consortiums for the purpose of bidding collectively in company buyout transactions in certain going private transactions and agreeing not to submit topping bids once such a consortium had announced a signed deal, which the plaintiffs allege constitutes a “conspiracy in restraint of trade.” To avoid the risk and cost associated with continuing the litigation through trial, the Partnership entered into an agreement with plaintiffs on August 29, 2014 to settle all claims against the Partnership without any admission of liability. All of the Partnership's codefendants also reached settlement agreements with plaintiffs. The Court approved all the defendants' settlements, including the Partnership’s, on March 17, 2015. Carlyle

39

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

Partners IV, L.P. (“CP IV”) and its affiliates incurred the costs of the settlement not covered by insurance. As a result, the Partnership's performance fees from CP IV were reduced by $19.3 million in 2014.

Along with many other companies and individuals in the financial sector, the Partnership and Carlyle Mezzanine Partners, L.P. (“CMP”) are named as defendants in Foy v. Austin Capital, a case filed in June 2009, pending in the State of New Mexico’s First Judicial District Court, County of Santa Fe, which purports to be a qui tam suit on behalf of the State of New Mexico. The suit alleges that investment decisions by New Mexico public investment funds were improperly influenced by campaign contributions and payments to politically connected placement agents. The plaintiffs seek, among other things, actual damages, actual damages for lost income, rescission of the investment transactions described in the complaint and disgorgement of all fees received. In May 2011, the Attorney General of New Mexico moved to dismiss certain defendants including the Partnership and CMP on the grounds that separate civil litigation by the Attorney General is a more effective means to seek recovery for the State from these defendants. The Attorney General has brought two civil actions against certain of those defendants, not including the Partnership defendants. The Attorney General has stated that its investigation is continuing and it may bring additional civil actions.

Carlyle Capital Corporation Limited (“CCC”) was a fund sponsored by the Partnership that invested in AAA-rated residential mortgage backed securities on a highly leveraged basis. In March of 2008, amidst turmoil throughout the mortgage markets and money markets, CCC filed for insolvency protection in Guernsey. Six different lawsuits developed from the CCC insolvency. Four of such lawsuits were dismissed or withdrawn. Two of such lawsuits remain and they are described below.

First, in November 2009, a CCC investor, National Industries Group (Holding) (“National Industries”) instituted legal proceedings in Kuwait’s Court of First Instance (National Industries Group v. Carlyle Group ) seeking to recover losses incurred in connection with an investment in CCC. In July 2011, the Delaware Court of Chancery issued a decision restraining National Industries from proceeding in Kuwait on any CCC-related claims based on the forum selection clause in National Industries’ subscription agreement, which provided for exclusive jurisdiction in the Delaware courts. Notwithstanding the ruling by the Delaware court, National Industries continued to pursue claims in Kuwait against CCC and the Partnership and National Industries also appealed the Delaware ruling. However, the court in Kuwait dismissed National Industries claims without prejudice for failure to serve process. Also, on May 29, 2013, the Delaware Supreme Court affirmed the Chancery Court’s decision and upheld the 2011 injunction barring National Industries from filing or prosecuting any CCC-related action in any forum other than the courts of Delaware. The statute of limitations for claims in Delaware has expired.

Second, the Guernsey liquidators who took control of CCC in March 2008 filed a suit on July 7, 2010 against the Partnership, certain of its affiliates and the former directors of CCC in the Royal Court of Guernsey (Carlyle Capital Corporation Limited v. Conway et al.) seeking $1.0 billion in damages. They allege that the Partnership and the CCC board of directors were negligent, grossly negligent or willfully mismanaged the CCC investment program and breached certain fiduciary duties allegedly owed to CCC and its shareholders. The liquidators further allege (among other things) that the directors and the Partnership put the interests of the Partnership ahead of the interests of CCC and its shareholders and gave priority to preserving and enhancing the Partnership’s reputation and its “brand” over the best interests of CCC. On July 24, 2013, plaintiffs filed an amended complaint, which contained further detail in support of the existing claims but no new defendants or claims. On December 20, 2013, defendants filed a defense to the amended complaint and on June 30, 2014 plaintiffs filed their reply. The Court has set the case schedule and trial is scheduled for the first available date after March 28, 2016.

It is not possible to predict the ultimate outcome of all pending investigations and legal proceedings, and some of the matters discussed above involve claims for potentially large and/or indeterminate amounts of damages. Based on information known by management, management has not concluded that as of the date of this filing the final resolutions of the matters above will have a material effect upon the Partnership’s condensed consolidated financial statements. However, given the potentially large and/or indeterminate amounts of damages sought in certain of these matters and the inherent unpredictability of investigations and litigations, it is possible that an adverse outcome in certain matters could, from time to time, have a material effect on our financial results in any particular period.

Other Contingencies

From 2007 to 2009, a Luxembourg subsidiary of CEREP I, a real estate fund, received proceeds from the sale of real estate located in Paris, France. Based on a provision in the Luxembourg-France tax treaty, it did not report or pay tax in France

40

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

on gain from the sale. The French tax authorities asserted that CEREP I was ineligible to claim exemptions from French tax under the tax treaty, and issued a tax assessment seeking to collect taxes, interest and penalties.

An income tax hearing on these matters was held on March 11, 2015 in front of the French tax court. On April 15, 2015, the French tax court issued an opinion in this matter that is adverse to CEREP I, holding the Luxembourg property company liable for approximately €105 million (including interest accrued since the beginning of the tax dispute). The Partnership disagrees with the outcome and is appealing. CEREP I has approximately €31 million in assets as of March 31, 2015. The remaining €74 million of the tax obligations will be paid by the Partnership. Additionally, the French Ministry of Justice is expected to continue its investigation of the actions of the Luxembourg property company and its former directors, managers and representatives in claiming the tax treaty exemptions.

The Partnership was required to provide a financial guarantee to the French government in July 2012 for the amount of French tax assessed against CEREP I. Since that time, the Partnership has consolidated CEREP I into its consolidated financial statements. Beginning with the quarter ended December 31, 2013, CEREP I had accrued a €75 million liability with respect to the French tax matter. As of March 31, 2015, CEREP I has increased the liability to €105 million ($112 million) to reflect the French tax court judgment, and the total liability is included in other liabilities of Consolidated Funds in the Partnership's condensed consolidated financial statements. For the three months ended March 31, 2015, CEREP I has recognized a loss of approximately $34 million which has been included in net investment gains/losses of Consolidated Funds, and this amount reduced net income attributable to Carlyle Holdings in the Partnership’s condensed consolidated financial statements. In 2013 and 2014, the Partnership had previously recognized losses of approximately €42 million for the French tax matter, which were reflected in net investment gains/losses of Consolidated Funds and reduced net income attributable to Carlyle Holdings.

Indemnifications

In the normal course of business, the Partnership and its subsidiaries enter into contracts that contain a variety of representations and warranties and provide general indemnifications. The Partnership’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Partnership that have not yet occurred. However, based on experience, the Partnership believes the risk of material loss to be remote.

Risks and Uncertainties

Carlyle’s funds seek investment opportunities that offer the possibility of attaining substantial capital appreciation. Certain events particular to each industry in which the underlying investees conduct their operations, as well as general economic conditions, may have a significant negative impact on the Partnership’s investments and profitability. Such events are beyond the Partnership’s control, and the likelihood that they may occur and the effect on the Partnership cannot be predicted.

Furthermore, certain of the funds’ investments are made in private companies and there are generally no public markets for the underlying securities at the current time. The funds’ ability to liquidate their publicly-traded investments are often subject to limitations, including discounts that may be required to be taken on quoted prices due to the number of shares being sold. The funds’ ability to liquidate their investments and realize value is subject to significant limitations and uncertainties, including among others currency fluctuations and natural disasters.

The funds make investments outside of the United States. Investments outside the U.S. may be subject to less developed bankruptcy, corporate, partnership and other laws (which may have the effect of disregarding or otherwise circumventing the limited liability structures potentially causing the actions or liabilities of one fund or a portfolio company to adversely impact the Partnership or an unrelated fund or portfolio company). Non-U.S. investments are subject to the same risks associated with the Partnership’s U.S. investments as well as additional risks, such as fluctuations in foreign currency exchange rates, unexpected changes in regulatory requirements, heightened risk of political and economic instability, difficulties in managing non-U.S. investments, potentially adverse tax consequences and the burden of complying with a wide variety of foreign laws.

Furthermore, Carlyle is exposed to economic risk concentrations related to certain large investments as well as concentrations of investments in certain industries and geographies.

41

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

Additionally, the Partnership encounters credit risk. Credit risk is the risk of default by a counterparty in the Partnership’s investments in debt securities, loans, leases and derivatives that result from a borrower’s, lessee’s or derivative counterparty’s inability or unwillingness to make required or expected payments.

The Partnership considers cash, cash equivalents, securities, receivables, equity-method investments, accounts payable, accrued expenses, other liabilities, loans payable, senior notes, assets and liabilities of Consolidated Funds and contingent and other consideration for acquisitions to be its financial instruments. Except for the senior notes, the carrying amounts reported in the condensed consolidated balance sheets for these financial instruments equal or closely approximate their fair values. The fair value of the senior notes is disclosed in Note 8.

12. Related Party Transactions

Due from Affiliates and Other Receivables, Net

The Partnership had the following due from affiliates and other receivables at March 31, 2015 and December 31, 2014:

	As of
	March 31, 2015		December 31, 2014
	(Dollars in millions)
Unbilled receivable for giveback obligations from current and former employees	$	28.4	$	27.7
Notes receivable and accrued interest from affiliates	11.7		11.1
Other receivables from unconsolidated funds and affiliates, net	162.7		160.6
Total	$	202.8	$	199.4

Notes receivable represent loans that the Partnership has provided to certain unconsolidated funds to meet short-term obligations to purchase investments. Other receivables from certain of the unconsolidated funds and portfolio companies relate to management fees receivable from limited partners, advisory fees receivable and expenses paid on behalf of these entities. These costs represent costs related to the pursuit of actual or proposed investments, professional fees and expenses associated with the acquisition, holding and disposition of the investments. The affiliates are obligated at the discretion of the Partnership to reimburse the expenses. Based on management’s determination, the Partnership accrues and charges interest on amounts due from affiliate accounts at interest rates ranging up to 7.17% as of March 31, 2015. The accrued and charged interest to the affiliates was not significant for any period presented.

These receivables are assessed regularly for collectability and amounts determined to be uncollectible are charged directly to general, administrative and other expenses in the condensed consolidated statements of operations. A corresponding allowance for doubtful accounts is recorded and such amounts were not significant for any period presented.

Due to Affiliates

The Partnership had the following due to affiliates balances at March 31, 2015 and December 31, 2014:

	As of
	March 31, 2015		December 31, 2014
	(Dollars in millions)
Due to affiliates of Consolidated Funds	$	0.2	$	0.6
Due to non-consolidated affiliates	41.6		37.1
Performance-based contingent cash and equity consideration related to acquisitions	46.8		43.6
Amounts owed under the tax receivable agreement	88.1		89.0
Other	14.8		13.9
Total	$	191.5	$	184.2

42

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

The Partnership has recorded obligations for amounts due to certain of its affiliates. The Partnership periodically offsets expenses it has paid on behalf of its affiliates against these obligations. The amount owed under the tax receivable agreement is related primarily to the acquisition by the Partnership of 9,300,000 Carlyle Holdings partnership units in March 2014 (see Note 1), as well as the exchange in May 2012 by CalPERS of its Carlyle Holdings partnership units for Partnership common units.

Other Related Party Transactions

In the normal course of business, the Partnership has made use of aircraft owned by entities controlled by senior Carlyle professionals. The senior Carlyle professionals paid for their purchases of the aircraft and bear all operating, personnel and maintenance costs associated with their operation for personal use. Payment by the Partnership for the business use of these aircraft by senior Carlyle professionals and other employees is made at market rates, which totaled $1.1 million and $1.5 million for the three months ended March 31, 2015 and 2014, respectively. These fees are included in general, administrative, and other expenses in the condensed consolidated statements of operations.

Senior Carlyle professionals and employees are permitted to participate in co-investment entities that invest in Carlyle funds or alongside Carlyle funds. In many cases, participation is limited by law to individuals who qualify under applicable legal requirements. These co-investment entities generally do not require senior Carlyle professionals and employees to pay management or performance fees, however, Carlyle professionals and employees are required to pay their portion of partnership expenses.

Carried interest income from the funds can be distributed to senior Carlyle professionals and employees on a current basis, but is subject to repayment by the subsidiary of the Partnership that acts as general partner of the fund in the event that certain specified return thresholds are not ultimately achieved. The senior Carlyle professionals and certain other investment professionals have personally guaranteed, subject to certain limitations, the obligation of these subsidiaries in respect of this general partner obligation. Such guarantees are several and not joint and are limited to a particular individual’s distributions received.

The Partnership does business with some of its portfolio companies; all such arrangements are on a negotiated basis.

Substantially all revenue is earned from affiliates of Carlyle.

13. Income Taxes

The Partnership is generally organized as a series of pass through entities pursuant to the United States Internal Revenue Code. As such, the Partnership is not responsible for the tax liability due on certain income earned during the year. Such income is taxed at the unitholder and non-controlling interest holder level, and any income tax is the responsibility of the unitholders and is paid at that level. For income taxes on income earned for which the Partnership is responsible for the tax liability, the Partnership's income tax expense was $10.5 million and $16.0 million for the three months ended March 31, 2015 and 2014, respectively.

In the normal course of business, the Partnership is subject to examination by federal and certain state, local and foreign tax regulators. As of March 31, 2015, the Partnership’s U.S. federal income tax returns for the years 2011 through 2014 are open under the normal three-year statute of limitations and therefore subject to examination. State and local tax returns are generally subject to audit from 2010 to 2014. Foreign tax returns are generally subject to audit from 2007 to 2014. Certain of the Partnership’s affiliates are currently under audit by federal, state and foreign tax authorities.

The Partnership does not believe that the outcome of these audits will require it to record reserves for uncertain tax positions or that the outcome will have a material impact on the consolidated financial statements. The Partnership does not believe that it has any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly increase or decrease within the next twelve months.

43

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

14. Non-controlling Interests in Consolidated Entities

The components of the Partnership’s non-controlling interests in consolidated entities are as follows:

	As of
	March 31, 2015			December 31, 2014
	(Dollars in millions)
Non-Carlyle interests in Consolidated Funds	$	5,655.8		$	6,160.1
Non-Carlyle interests in majority-owned subsidiaries	323.6			301.4
Non-controlling interest in carried interest and cash held for carried interest distributions	(53.7		)	(15.1		)
Non-controlling interests in consolidated entities	$	5,925.7		$	6,446.4

The components of the Partnership’s non-controlling interests in income (loss) of consolidated entities are as follows:

	Three Months Ended March 31,
	2015			2014
	(Dollars in millions)
Non-Carlyle interests in Consolidated Funds	$	449.9		$	352.9
Non-Carlyle interests in majority-owned subsidiaries	(0.8		)	(21.3		)
Non-controlling interest in carried interest and cash held for carried interest distributions	(37.9		)	8.0
Net income attributable to other non-controlling interests in consolidated entities	411.2			339.6
Net loss attributable to partners’ capital appropriated for CLOs	(48.6		)	(82.1		)
Net income attributable to redeemable non-controlling interests in consolidated entities	76.5			67.0
Non-controlling interests in income of consolidated entities	$	439.1		$	324.5

There have been no significant changes in the Partnership’s ownership interests in its consolidated entities for the periods presented other than the Partnership’s acquisition of 13,800,000 Carlyle Holdings partnership units in March 2014 (see Note 1).

15. Earnings Per Common Unit

Basic and diluted net income per common unit are calculated as follows:

	Three Months Ended   March 31, 2015						Three Months Ended   March 31, 2014
	Basic			Diluted			Basic			Diluted
Net income attributable to The Carlyle Group L.P.	$	39,500,000		$	39,500,000		$	24,600,000		$	24,600,000
Dilution of earnings due to participating securities with distribution rights	(427,000		)	(479,600		)	(432,600		)	(517,200		)
Net income attributable to common units	$	39,073,000		$	39,020,400		$	24,167,400		$	24,082,800
Weighted-average common units outstanding	67,684,674			72,347,771			52,501,412			59,453,670
Net income per common unit	$	0.58		$	0.54		$	0.46		$	0.41

44

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

The weighted-average common units outstanding, basic and diluted, are calculated as follows:

	Three Months Ended   March 31, 2015		Three Months Ended   March 31, 2014
	Basic	Diluted	Basic	Diluted
The Carlyle Group L.P. weighted-average common units outstanding	67,684,674	67,684,674	52,501,412	52,501,412
Unvested deferred restricted common units	—	4,663,097	—	6,486,349
Contingently issuable Carlyle Holdings Partnership units	—	—	—	465,909
Weighted-average common units outstanding	67,684,674	72,347,771	52,501,412	59,453,670

The weighted-average common units outstanding of The Carlyle Group L.P. includes vested deferred restricted common units and other common units associated with acquisitions that have been earned for which issuance of the related common units is deferred until future periods.

The Partnership applies the treasury stock method to determine the dilutive weighted-average common units represented by the unvested deferred restricted common units. Also included in the determination of dilutive weighted-average common units are contingently issuable Carlyle Holdings partnership units and common units associated with the Claren Road, Vermillion, Metropolitan, and DGAM acquisitions. For purposes of determining the dilutive weighted-average common units, it is assumed that March 31, 2015 and 2014 represent the end of the contingency period, the “if-converted” method is applied to any Carlyle Holdings partnership units issuable therefrom, and the treasury stock method is applied.

The Partnership applies the “if-converted” method to the vested Carlyle Holdings partnership units to determine the dilutive weighted-average common units outstanding. The Partnership applies the treasury stock method to the unvested Carlyle Holdings partnership units and the “if-converted” method on the resulting number of additional Carlyle Holdings partnership units to determine the dilutive weighted-average common units represented by the unvested Carlyle Holdings partnership units.

In computing the dilutive effect that the exchange of Carlyle Holdings partnership units would have on earnings per common unit, the Partnership considered that net income available to holders of common units would increase due to the elimination of non-controlling interests in Carlyle Holdings (including any tax impact). Based on these calculations, the incremental 227,127,601 and 234,789,709 of vested and unvested Carlyle Holdings partnership units for the three months ended March 31, 2015 and 2014, respectively, were antidilutive, and therefore have been excluded.

On August 1, 2013, as part of acquiring the remaining 40% equity interests in AlpInvest, the Partnership issued 914,087 common units that are subject to vesting conditions. As of March 31, 2015, 778,665 common units remain unvested. The common units participate immediately in any Partnership distributions. Under ASC 260, these common units are considered participating securities and are required to be included in the computation of earnings per common unit pursuant to the two-class method.

16. Equity-Based Compensation

In May 2012, Carlyle Group Management L.L.C., the general partner of the Partnership, adopted The Carlyle Group L.P. 2012 Equity Incentive Plan (the “Equity Incentive Plan”). The Equity Incentive Plan is a source of equity-based awards permitting the Partnership to grant to Carlyle employees, directors of the Partnership’s general partner and consultants non-qualified options, unit appreciation rights, common units, restricted common units, deferred restricted common units, phantom restricted common units and other awards based on the Partnership’s common units and Carlyle Holdings partnership units. The total number of the Partnership’s common units and Carlyle Holdings partnership units which were initially available for grant under the Equity Incentive Plan was 30,450,000. The Equity Incentive Plan contains a provision which automatically increases the number of the Partnership’s common units and Carlyle Holdings partnership units available for grant based on a pre-determined formula; this increase occurs annually on January 1. As of January 1, 2015, pursuant to the formula, the total number of the Partnership’s common units and Carlyle Holdings partnership units available for grant under the Equity Incentive Plan was 31,895,630.

45

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

Unvested Partnership Common Units

On August 1, 2013, the Partnership acquired the remaining 40% equity interest in AlpInvest. As part of the transaction, the Partnership issued 914,087 common units to AlpInvest sellers who are employees of the Partnership that are subject to vesting conditions.

These newly issued common units were unvested at grant and vest over a period of up to five years. The unvested common units are accounted for as equity-based compensation in accordance with ASC Topic 718, Compensation – Stock Compensation (“ASC 718”). The grant-date fair value of the unvested common units is charged to equity-based compensation on a straight-line basis over the required service period. Additionally, the calculation of the expense assumes a forfeiture rate of up to 5%. For the three months ended March 31, 2015 and 2014, the Partnership recorded $2.9 million and $2.1 million in equity-based compensation expense associated with these awards, respectively. As of March 31, 2015, the total unrecognized equity-based compensation expense related to unvested common units, considering estimated forfeitures, is $8.1 million, which is expected to be recognized over a weighted-average term of 1.0 year.

Unvested Carlyle Holdings Partnership Units

Unvested Carlyle Holdings partnership units are held by senior Carlyle professionals and other individuals engaged in Carlyle’s business and generally vest ratably over a six-year period. The unvested Carlyle Holdings partnership units are accounted for as equity-based compensation in accordance with ASC 718. The grant-date fair value of the unvested Carlyle Holdings partnership units are charged to equity-based compensation expense on a straight-line basis over the required service period. Additionally, the calculation of the expense assumes a forfeiture rate of up to 2.5%. The Partnership recorded equity-based compensation expense associated with these awards of $42.0 million and $44.8 million for the three months ended March 31, 2015 and 2014, respectively. No tax benefits have been recorded related to the unvested Carlyle Holdings partnership units, as the vesting of these units does not result in a tax deduction to the corporate taxpayers.

In connection with the Partnership’s investment in NGP Management in December 2012, the Partnership issued 996,572 Carlyle Holdings partnership units to ECM Capital, L.P. which vest ratably over a period of five years. The Partnership also issued 597,944 Carlyle Holdings partnership units to ECM Capital, L.P. that were issued at closing but vest upon the achievement of performance conditions. The fair value of these units will be recognized as a reduction to the Partnership’s investment income in NGP Management over the relevant service or performance period, based on the fair value of the units on each reporting date and adjusted for the actual fair value of the units at each vesting date. For the Carlyle Holdings partnership units that vest based on the achievement of performance conditions, the Partnership uses the minimum number of partnership units within the range of potential values for measurement and recognition purposes.

As of March 31, 2015, the total unrecognized equity-based compensation expense related to unvested Carlyle Holdings partnership units, considering estimated forfeitures, is $587.4 million, which is expected to be recognized over a weighted-average term of 3.1 years.

Deferred Restricted Common Units

The deferred restricted common units are unvested when granted and vest ratably over a service period, which ranges up to six years. The grant-date fair value of the deferred restricted common units granted to Carlyle’s employees is charged to equity-based compensation expense on a straight-line basis over the required service period. Additionally, the calculation of the expense assumes a forfeiture rate that generally ranges from 2% to 10% and a per unit discount that generally ranges up to 25%, as these unvested awards do not participate in any Partnership distributions. During the three months ended March 31, 2015, the Partnership revised its estimated forfeiture rates to 2% to 10% from a previous range of 5% to 15%. As a result, the Partnership recognized $7.5 million of equity-based compensation expense during the three months ended March 31, 2015 for the cumulative effect of the change in this estimate. The Partnership recorded compensation expense of $44.3 million and $26.9 million for the three months ended March 31, 2015 and 2014, respectively, with $4.1 million and $3.3 million of corresponding deferred tax benefits, respectively. As of March 31, 2015, the total unrecognized equity-based compensation expense related to unvested deferred restricted common units, considering estimated forfeitures, is $443.2 million, which is expected to be recognized over a weighted-average term of 3.0 years.

Equity-based awards issued to non-employees are recognized as general, administrative and other expenses. The expense associated with the deferred restricted common units granted to NGP personnel by the Partnership are recognized as a reduction of the Partnership’s investment income in NGP Management. The grant-date fair value of deferred restricted common units

46

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

granted to Carlyle’s non-employee directors is charged to expense on a straight-line basis over the vesting period. The cost of services received in exchange for an equity-based award issued to consultants is measured at each vesting date. Equity-based awards that require the satisfaction of future service criteria are recognized over the relevant service period, adjusted for estimated forfeitures of awards not expected to vest, based on the fair value of the award on each reporting date and adjusted for the actual fair value of the award at each vesting date. The expense for equity-based awards issued to non-employees was not significant for the three months ended March 31, 2015 and 2014.

Phantom Deferred Restricted Common Units

The phantom deferred restricted common units are unvested when granted and vest ratably over a service period of three years. Upon vesting, the units will be settled in cash. As the phantom deferred restricted common units will be settled in cash, they are accounted for as liability awards. The fair value of the units is re-measured at each reporting period until settlement and charged to equity-based compensation expense over the vesting period. Additionally, the calculation of the expense assumes a forfeiture rate of 10%. During the three months ended March 31, 2015, the Partnership revised its estimated forfeiture rate to 10% from 15%. The cumulative effect of the change in this estimate was not material. The Partnership recorded $0.7 million and $0.4 million in equity-based compensation expense associated with these awards for the three months ended March 31, 2015 and 2014, respectively. The tax benefits recognized from these awards was not material during these periods. As of March 31, 2015, the total unrecognized equity-based compensation expense related to unvested phantom deferred restricted common units, considering estimated forfeitures, is $0.8 million, which is expected to be recognized over a weighted-average term of 0.4 years.

A summary of the status of the Partnership’s non-vested equity-based awards as of March 31, 2015 and a summary of changes for the three months ended March 31, 2015, are presented below:

	Carlyle Holdings			The Carlyle Group, L.P.
				Equity Settled Awards						Cash Settled Awards
Unvested Units	Partnership Units	Weighted- Average Grant Date Fair Value		Deferred Restricted Common Units	Weighted- Average Grant Date Fair Value		Unvested Common Units	Weighted- Average Grant Date Fair Value		Phantom Units	Weighted- Average Grant Date Fair Value
Balance, December 31, 2014	35,997,415	$	22.16	18,929,270	$	26.12	809,797	$	27.19	104,070	$	23.40
Granted	—	$	—	4,981,436	$	23.83	—	$	—	—	$	—
Vested	—	$	—	931,965	$	28.90	31,132	$	21.53	3,408	$	34.81
Forfeited	91,174	$	22.00	512,748	$	24.01	—	$	—	2,950	$	23.41
Balance, March 31, 2015	35,906,241	$	22.16	22,465,993	$	25.51	778,665	$	27.42	97,712	$	23.00

17. Consolidation of a Real Estate Development Company

The Partnership, indirectly through certain Carlyle real estate investment funds, has an investment in Urbplan Desenvolvimento Urbano S.A. (“Urbplan”), a Brazilian residential subdivision and land development company.

In late 2012, it was determined that Urbplan was facing serious liquidity problems and would require additional capital infusions to continue operations. The Partnership and certain of its senior Carlyle professionals provided capital to Urbplan through one of the Carlyle investment funds starting in 2013. The Partnership concluded that Urbplan was a VIE as of September 30, 2013 because Urbplan’s equity investment at risk was not sufficient to permit it to finance its activities without additional financial support. The Partnership also concluded that it was the primary beneficiary of Urbplan since the Partnership has the power to direct the activities of Urbplan that most significantly impact its economic performance and the Partnership’s investments in Urbplan will absorb losses incurred by Urbplan. As such, the Partnership began consolidating Urbplan into its consolidated financial statements as of September 30, 2013. Due to the timing and availability of financial information from Urbplan, the Partnership consolidates the financial position and results of operations of Urbplan on a financial reporting lag of 90 days. The Partnership will disclose the effect of intervening events at Urbplan that materially affect the financial position or results of operations of the Partnership, if any.

The assets and liabilities of Urbplan are held in legal entities separate from the Partnership; the Partnership has not guaranteed or assumed any obligation for repayment of Urbplan’s liabilities nor are the assets of Urbplan available to meet the liquidity requirements of the Partnership. However, if Urbplan fails to complete its construction projects, customers, partners,

47

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

government agencies or municipalities or other creditors in certain circumstances might seek to assert claims against the Partnership and its assets unrelated to Urbplan under certain consumer protection or other laws.

Urbplan is currently a party to various litigation, government investigations and proceedings, disputes and other potential claims. The Partnership does not believe it is probable that the outcome of any existing Urbplan litigation, disputes or other potential claims will materially affect the Partnership or these consolidated financial statements.

From 2013 through March 31, 2015, $227.4 million has been funded to Urbplan by the Partnership and its senior Carlyle professionals (net of gains from related foreign currency forward contracts). The Partnership has funded $54.3 million of the $227.4 million and the remaining $173.1 million has been funded by senior Carlyle professionals indirectly through the Partnership. For the three months ended March 31, 2015, $14.1 million was funded to Urbplan, of which the Partnership funded $3.5 million and the senior Carlyle professionals funded $10.6 million indirectly through the Partnership.

At this time, Urbplan is estimated to require approximately $90 million of additional capital over the next twelve months to complete its expected business turnaround. While no contractual or other obligations exist to provide additional financial support to Urbplan, the Partnership and its senior Carlyle professionals expect to provide additional capital funding to Urbplan in the future and Urbplan will continue to seek capital funding from unaffiliated parties. The Partnership and its senior Carlyle professionals will evaluate the possibility of further capital infusions based on the circumstances at the time (including levels of third-party funding participation). It is anticipated that the Partnership would fund 25% and its senior Carlyle professionals would fund 75% indirectly through the Partnership of any additional investments made by the Partnership and its senior Carlyle professionals.

The assets and liabilities recognized in the Partnership’s condensed consolidated balance sheets as of March 31, 2015 and December 31, 2014 related to Urbplan were as follows:

	As of
	March 31, 2015		December 31, 2014
	(Dollars in millions)
Receivables and inventory of a consolidated real estate VIE:
Customer and other receivables	$	106.4	$	91.5
Inventory costs in excess of billings and advances	78.6		72.4
	$	185.0	$	163.9
Other assets of a consolidated real estate VIE:
Restricted investments	$	34.1	$	36.8
Fixed assets, net	1.4		1.8
Deferred tax assets	10.0		12.9
Other assets	28.2		34.9
	$	73.7	$	86.4
Loans payable of a consolidated real estate VIE, at fair value (principal amount of $214.8 million and $243.6 million as of March 31, 2015 and December 31, 2014, respectively)	$	139.6	$	146.2
Other liabilities of a consolidated real estate VIE:
Accounts payable	$	23.2	$	26.1
Other liabilities	82.2		58.8
	$	105.4	$	84.9

48

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

The revenues and expenses recognized in the Partnership’s condensed consolidated statements of operations for the three months ended March 31, 2015 and 2014, respectively, related to Urbplan were as follows:

	Three Months Ended March 31, 2015		Three Months Ended March 31, 2014
	(Dollars in millions)
Revenue of a consolidated real estate VIE
Land development services	$	54.8	$	4.6
Investment income	0.4		1.4
	$	55.2	$	6.0
Interest and other expenses of a consolidated real estate VIE:
Costs of products sold and services rendered	$	41.0	$	13.7
Interest expense	10.2		11.2
Change in fair value of loans payable	5.8		10.2
Compensation and benefits	2.6		2.4
G&A and other expenses	10.4		11.7
	$	70.0	$	49.2

The following is a summary of the significant classifications of assets and liabilities of Urbplan:

Customer and other receivables – This balance consists primarily of amounts owed for land development services using the completed contract method. Customer receivables accrue interest at rates ranging from 9% to 12% per year and are secured by the underlying real estate. Substantially all receivables are pledged as collateral for Urbplan’s borrowings. The carrying value of the receivables includes an appropriate allowance for estimated uncollectible accounts to reflect any loss anticipated on the balances. Urbplan calculates this allowance based on its history of write-offs, the level of past-due accounts based on the contractual terms of the receivables, and its relationships with, and the economic status of, Urbplan’s customers.

Inventory costs in excess of billings and advances – This balance consists primarily of capitalized land development cost, net of approximately $148.1 million and $190.4 million of customer advances received as of March 31, 2015 and December 31, 2014, respectively. Urbplan records valuation adjustments on inventory when events and circumstances indicate that the inventory may be impaired and when the cash flows estimated to be generated by the real estate project are less than its carrying amount. Real estate projects that demonstrate potential impairment indicators are tested for impairment by Urbplan by comparing the expected undiscounted cash flows for the real estate project to its carrying value. For those real estate projects whose carrying values exceed the expected undiscounted cash flows, Urbplan estimates the fair value of the real estate projects. Impairment charges are recorded if the fair value of the inventory is less than its carrying value. The estimates used in the determination of the estimated fair value of the real estate projects were based on factors known to Urbplan at the time such estimates were made and the expectations of future operations and economic conditions. Should the estimates or expectations used in determining estimated fair value deteriorate in the future, Urbplan may be required to recognize additional impairment charges and write-offs related to real estate projects.

49

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

Loans payable of a consolidated real estate VIE – This balance consists of Urbplan’s borrowings for its real estate development activities. The estimated fair value approximates 65% of the outstanding principal amounts of the loans. The fair value of the loans was based on discounted cash flow analyses which considered the liquidity and current financial condition of Urbplan and applicable discount rates. The Partnership has elected to re-measure the loans at fair value at each reporting period through the term of the loans. The principal amounts of the loans accrue interest at a variable rate based on an index plus an applicable margin. Interest rates are based on: (i) CDI plus a margin ranging from 4.0% to 7.4% (16.6% to 20.0% as of March 31, 2015); (ii) IGP-M plus a margin of 12.0% (15.1% as of March 31, 2015); or (iii) IPCA plus a margin ranging from 10.0% to 13.5% (18.1% to 21.6% as of March 31, 2015). Outstanding principal amounts on the loans based on current contractual terms are payable as follows (Dollars in millions):

2015	$	27.6
2016	24.3
2017	19.1
2018	16.5
2019	19.1
Thereafter	108.2
	$	214.8

Substantially all of Urbplan’s customer and other receivables and investments have been pledged as collateral for the loans. As of March 31, 2015, substantially all of Urbplan’s loans payable are not in compliance with their related debt covenants or are otherwise in technical default. These violations do not cause a default or event of default under the Partnership’s senior credit facility or senior notes. Urbplan management is in discussions with the lenders to cure or re-negotiate the loans in default. Currently there are no outstanding notices of acceleration of payment on the loans in default.

All of the loans payable of Urbplan are contractually non-recourse to the Partnership.

Other liabilities – This balance consists of amounts owed to landowners, commissions payable to brokers, real estate taxes, social charges and other liabilities.

Revenue of a consolidated real estate VIE – This balance consists primarily of amounts earned for land development services using the completed contract method and investment income earned on Urbplan’s investments. Under the completed contract method of accounting, revenue is not recorded until the period in which the land development services contract is completed.

Interest and other expenses of a consolidated real estate VIE – This balance consists primarily of interest expense on Urbplan’s borrowings, general and administrative expenses, compensation and benefits, and costs associated with land development services. Also included in this caption is the change in the Partnership’s estimate of the fair value of Urbplan’s loans payable during the period. Interest expense is recorded on Urbplan’s borrowings at variable rates as defined. Costs related to Urbplan’s land development services activities are capitalized until the services are complete. Costs associated with advertising, marketing and other selling activities are expensed when incurred.

Impairment – Urbplan evaluates its assets for impairment whenever events or changes in circumstances indicate that the carrying amount of such asset may not be recoverable, but not less than annually.

As of March 31, 2015, Urbplan had outstanding commitments for land development services with an estimated $85.6 million of future costs to be incurred.

50

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

18. Segment Reporting

Carlyle conducts its operations through four reportable segments:

Corporate Private Equity – The Corporate Private Equity segment is comprised of the Partnership’s operations that advise a diverse group of funds that invest in buyout and growth capital transactions that focus on either a particular geography or a particular industry.

Global Market Strategies – The Global Market Strategies segment advises a group of funds that pursue investment opportunities across various types of credit, equities and alternative instruments, and (as regards certain macroeconomic strategies) currencies, commodities, sovereign debt, and interest rate products and their derivatives.

Real Assets – The Real Assets segment is comprised of the Partnership’s operations that advise U.S. and international funds focused on real estate, infrastructure, energy and renewable energy transactions.

Investment Solutions – The Investment Solutions segment advises a global private equity fund of funds program and related co-investment and secondary activities through AlpInvest. This segment also includes Metropolitan, a global manager of real estate fund of funds, and DGAM, the Partnership’s fund of hedge funds platform.

The Partnership’s reportable business segments are differentiated by their various investment focuses and strategies. Overhead costs are allocated based on direct base compensation expense for each segment. The Partnership includes adjustments to reflect the Partnership’s economic interests in Claren Road, ESG and Vermillion. The Partnership’s earnings from its investment in NGP Management are presented in the respective operating captions within the Real Assets segment. The net income or loss from the consolidation of Urbplan allocable to the Partnership (after consideration of amounts allocable to non-controlling interests) is presented within investment income in the Real Assets segment.

Economic Net Income (“ENI”) and its components are key performance measures used by management to make operating decisions and assess the performance of the Partnership’s reportable segments. ENI differs from income (loss) before provision for income taxes computed in accordance with U.S. GAAP in that it includes certain tax expenses associated with performance fee compensation, and does not include net income (loss) attributable to non-Carlyle interests in Consolidated Funds or charges (credits) related to Carlyle corporate actions and non-recurring items. Charges (credits) related to Carlyle corporate actions and non-recurring items include: charges associated with equity-based compensation that was issued in the initial public offering in May 2012 or is issued in acquisitions or strategic investments, amortization associated with acquired intangible assets, transaction costs associated with acquisitions, charges associated with earnouts and contingent consideration including gains and losses associated with the mark to market on contingent consideration issued in conjunction with acquisitions or strategic investments, gains and losses from the retirement of debt, charges associated with lease terminations and employee severance and settlements of legal claims.

Distributable earnings (“DE”) is a component of ENI and is used to assess performance and amounts potentially available for distribution. Distributable earnings differs from income (loss) before provision for income taxes computed in accordance with U.S. GAAP in that it adjusts for the items included in the calculation of ENI and also adjusts ENI for unrealized performance fees, unrealized investment income, the corresponding unrealized performance fee compensation expense and equity-based compensation.

Fee-related earnings (“FRE”) is a component of DE and is used to assess the ability of the business to cover direct base compensation and operating expenses from total fee revenues. FRE differs from income (loss) before provision for income taxes computed in accordance with U.S. GAAP in that it adjusts for the items included in the calculation of DE and also adjusts DE to exclude realized performance fees, realized investment income from investments in Carlyle funds, and realized performance fee related compensation.

ENI and its components are used by management primarily in making resource deployment and compensation decisions across the Partnership’s four reportable segments. Management makes operating decisions and assesses the performance of each of the Partnership’s business segments based on financial and operating metrics and data that is presented without the consolidation of any of the Consolidated Funds. Consequently, ENI and all segment data exclude the assets, liabilities and operating results related to the Consolidated Funds.

51

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

The following table presents the financial data for the Partnership’s four reportable segments as of and for the three months ended March 31, 2015:

	March 31, 2015 and the Three Months Then Ended
	Corporate Private Equity		Global Market Strategies			Real Assets			Investment Solutions		Total
	(Dollars in millions)
Segment Revenues
Fund level fee revenues
Fund management fees	$	134.3	$	55.5		$	66.3		$	40.5	$	296.6
Portfolio advisory fees, net	5.2		0.5			0.1			—		5.8
Transaction fees, net	1.5		—			0.3			—		1.8
Total fund level fee revenues	141.0		56.0			66.7			40.5		304.2
Performance fees
Realized	306.0		4.6			7.7			3.4		321.7
Unrealized	200.7		18.7			14.1			47.0		280.5
Total performance fees	506.7		23.3			21.8			50.4		602.2
Investment income (loss)
Realized	2.7		1.6			(86.4		)	0.1		(82.0		)
Unrealized	7.4		(4.2		)	50.2			0.6		54.0
Total investment income (loss)	10.1		(2.6		)	(36.2		)	0.7		(28.0		)
Interest and other income	3.2		1.8			1.1			0.4		6.5
Total revenues	661.0		78.5			53.4			92.0		884.9
Segment Expenses
Compensation and benefits
Direct base compensation	53.7		28.2			18.5			21.5		121.9
Indirect base compensation	26.3		8.8			12.3			3.6		51.0
Equity-based compensation	17.3		5.2			7.1			2.7		32.3
Performance fee related
Realized	137.0		2.3			1.8			2.2		143.3
Unrealized	95.7		8.2			28.9			44.3		177.1
Total compensation and benefits	330.0		52.7			68.6			74.3		525.6
General, administrative, and other indirect expenses	31.7		12.3			14.6			7.9		66.5
Depreciation and amortization expense	2.7		1.1			0.9			0.8		5.5
Interest expense	7.6		2.8			2.7			1.5		14.6
Total expenses	372.0		68.9			86.8			84.5		612.2
Economic Net Income (Loss)	$	289.0	$	9.6		$	(33.4	)	$	7.5	$	272.7
(-) Net Performance Fees	274.0		12.8			(8.9		)	3.9		281.8
(-) Investment Income (Loss)	10.1		(2.6		)	(36.2		)	0.7		(28.0		)
(+) Equity-based Compensation	17.3		5.2			7.1			2.7		32.3
(=) Fee Related Earnings	$	22.2	$	4.6		$	18.8		$	5.6	$	51.2
(+) Realized Net Performance Fees	169.0		2.3			5.9			1.2		178.4
(+) Realized Investment Income (Loss)	2.7		1.6			(86.4		)	0.1		(82.0		)
(=) Distributable Earnings	$	193.9	$	8.5		$	(61.7	)	$	6.9	$	147.6
Segment assets as of March 31, 2015	$	3,927.1	$	908.4		$	1,556.0		$	728.5	$	7,120.0

52

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

The following table presents the financial data for the Partnership’s four reportable segments for the three months ended March 31, 2014:

	Three Months Ended March 31, 2014
	Corporate Private Equity		Global Market Strategies		Real Assets			Investment Solutions		Total
	(Dollars in millions)
Segment Revenues
Fund level fee revenues
Fund management fees	$	129.8	$	63.2	$	50.3		$	44.5	$	287.8
Portfolio advisory fees, net	3.5		0.1		0.2			—		3.8
Transaction fees, net	3.2		—		—			—		3.2
Total fund level fee revenues	136.5		63.3		50.5			44.5		294.8
Performance fees
Realized	234.7		8.3		0.5			5.9		249.4
Unrealized	212.9		49.5		14.0			79.3		355.7
Total performance fees	447.6		57.8		14.5			85.2		605.1
Investment income (loss)
Realized	1.9		1.3		2.1			—		5.3
Unrealized	5.4		1.9		(20.6		)	0.1		(13.2		)
Total investment income (loss)	7.3		3.2		(18.5		)	0.1		(7.9		)
Interest and other income	2.2		1.3		0.7			0.3		4.5
Total revenues	593.6		125.6		47.2			130.1		896.5
Segment Expenses
Compensation and benefits
Direct base compensation	59.5		27.5		18.7			21.0		126.7
Indirect base compensation	22.0		6.0		14.3			3.8		46.1
Equity-based compensation	7.1		2.7		3.5			0.7		14.0
Performance fee related
Realized	101.3		3.8		0.2			4.0		109.3
Unrealized	100.5		14.8		8.4			75.7		199.4
Total compensation and benefits	290.4		54.8		45.1			105.2		495.5
General, administrative, and other indirect expenses	35.4		11.6		15.5			9.2		71.7
Depreciation and amortization expense	2.7		0.9		0.9			0.9		5.4
Interest expense	6.7		2.1		2.2			1.2		12.2
Total expenses	335.2		69.4		63.7			116.5		584.8
Economic Net Income (Loss)	$	258.4	$	56.2	$	(16.5	)	$	13.6	$	311.7
(-) Net Performance Fees	245.8		39.2		5.9			5.5		296.4
(-) Investment Income (Loss)	7.3		3.2		(18.5		)	0.1		(7.9		)
(+) Equity-based Compensation	7.1		2.7		3.5			0.7		14.0
(=) Fee Related Earnings	$	12.4	$	16.5	$	(0.4	)	$	8.7	$	37.2
(+) Realized Net Performance Fees	133.4		4.5		0.3			1.9		140.1
(+) Realized Investment Income	1.9		1.3		2.1			—		5.3
(=) Distributable Earnings	$	147.7	$	22.3	$	2.0		$	10.6	$	182.6

53

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

The following table reconciles the Total Segments to the Partnership’s Income Before Provision for Taxes as of and for the three months ended March 31, 2015:

	March 31, 2015 and the Three Months Then Ended
	Total Reportable Segments		Consolidated Funds		Reconciling Items				Carlyle Consolidated
	(Dollars in millions)
Revenues	$	884.9	$	226.3	$	25.6		(a)	$	1,136.8
Expenses	$	612.2	$	292.8	$	122.0		(b)	$	1,027.0
Other income	$	—	$	507.8	$	(2.3	)	(c)	$	505.5
Economic net income	$	272.7	$	441.3	$	(98.7	)	(d)	$	615.3
Total assets	$	7,120.0	$	28,096.6	$	(203.4	)	(e)	$	35,013.2

The following table reconciles the Total Segments to the Partnership’s Income Before Provision for Taxes for the three months ended March 31, 2014:

	Three Months Ended March 31, 2014
	Total Reportable Segments		Consolidated Funds		Reconciling Items				Carlyle Consolidated
	(Dollars in millions)
Revenues	$	896.5	$	250.7	$	0.2		(a)	$	1,147.4
Expenses	$	584.8	$	339.8	$	174.4		(b)	$	1,099.0
Other income	$	—	$	426.9	$	(2.9	)	(c)	$	424.0
Economic net income	$	311.7	$	337.8	$	(177.1	)	(d)	$	472.4

(a) The Revenues adjustment principally represents fund management and performance fees earned from the Consolidated Funds which were eliminated in consolidation to arrive at the Partnership’s total revenues, adjustments for amounts attributable to non-controlling interests in consolidated entities, adjustments related to expenses associated with the investments in NGP Management and its affiliates that are included in operating captions or are excluded from the segment results, adjustments to reflect the Partnership’s share of Urbplan’s net losses as a component of investment income, and adjustments to reflect the Partnership’s ownership interests in Claren Road, ESG and Vermillion that were included in Revenues in the Partnership’s segment reporting.

54

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

(b) The Expenses adjustment represents the elimination of intercompany expenses of the Consolidated Funds payable to the Partnership, the inclusion of certain tax expenses associated with performance fee compensation, adjustments related to expenses associated with the investment in NGP Management that are included in operating captions, adjustments to reflect the Partnership’s share of Urbplan’s net losses as a component of investment income, charges and credits associated with Carlyle corporate actions and non-recurring items and adjustments to reflect the Partnership’s economic interests in Claren Road, ESG and Vermillion, as detailed below (Dollars in millions):

	Three Months Ended March 31,
	2015			2014
Equity-based compensation issued in conjunction with the initial public offering, acquisitions and strategic investments	$	59.0		$	62.4
Acquisition related charges and amortization of intangibles	40.6			80.1
Other non-operating expense	1.1			30.2
Tax expense associated with performance fee compensation	(5.2		)	(10.2		)
Non-Carlyle economic interests in acquired business	80.3			85.5
Other adjustments	1.2			2.3
Elimination of expenses of Consolidated Funds	(55.0		)	(75.9		)
	$	122.0		$	174.4

(c) The Other Income (Loss) adjustment results from the Consolidated Funds which were eliminated in consolidation to arrive at the Partnership’s total Other Income (Loss).

(d) The following table is a reconciliation of Income Before Provision for Income Taxes to Economic Net Income, to Fee Related Earnings, and to Distributable Earnings (Dollars in millions):

	Three Months Ended March 31,
	2015			2014
Income before provision for income taxes	$	615.3		$	472.4
Adjustments:
Equity-based compensation issued in conjunction with the initial public offering, acquisitions and strategic investments	59.0			62.4
Acquisition related charges and amortization of intangibles	40.6			80.1
Other non-operating expense	1.1			30.2
Tax expense associated with performance fee compensation	(5.2		)	(10.2		)
Net income attributable to non-controlling interests in Consolidated entities	(439.1		)	(324.5		)
Other adjustments	1.0			1.3
Economic Net Income	$	272.7		$	311.7
Net performance fees(1)	281.8			296.4
Investment loss(1)	(28.0		)	(7.9		)
Equity-based compensation	32.3			14.0
Fee Related Earnings	$	51.2		$	37.2
Realized performance fees, net of related compensation	178.4			140.1
Realized investment income (loss)(1)	(82.0		)	5.3
Distributable Earnings	$	147.6		$	182.6

55

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

(1) See reconciliation to most directly comparable U.S. GAAP measure below:

	Three Months Ended March 31, 2015
	Carlyle Consolidated			Adjustments (2)			Total Reportable Segments
	(Dollars in millions)
Performance fees
Realized	$	326.8		$	(5.1	)	$	321.7
Unrealized	246.2			34.3			280.5
Total performance fees	573.0			29.2			602.2
Performance fee related compensation expense
Realized	143.0			0.3			143.3
Unrealized	173.7			3.4			177.1
Total performance fee related compensation expense	316.7			3.7			320.4
Net performance fees
Realized	183.8			(5.4		)	178.4
Unrealized	72.5			30.9			103.4
Total net performance fees	$	256.3		$	25.5		$	281.8
Investment income (loss)
Realized	$	8.9		$	(90.9	)	$	(82.0	)
Unrealized	(2.1		)	56.1			54.0
Investment income (loss)	$	6.8		$	(34.8	)	$	(28.0	)

	Three Months Ended March 31, 2014
	Carlyle Consolidated		Adjustments (2)			Total Reportable Segments
	(Dollars in millions)
Performance fees
Realized	$	251.4	$	(2.0	)	$	249.4
Unrealized	369.1		(13.4		)	355.7
Total performance fees	620.5		(15.4		)	605.1
Performance fee related compensation expense
Realized	108.7		0.6			109.3
Unrealized	221.6		(22.2		)	199.4
Total performance fee related compensation expense	330.3		(21.6		)	308.7
Net performance fees
Realized	142.7		(2.6		)	140.1
Unrealized	147.5		8.8			156.3
Total net performance fees	$	290.2	$	6.2		$	296.4
Investment income (loss)
Realized	$	—	$	5.3		$	5.3
Unrealized	6.1		(19.3		)	(13.2		)
Total investment income (loss)	$	6.1	$	(14.0	)	$	(7.9	)

(2) Adjustments to performance fees and investment income (loss) relate to (i) amounts earned from the Consolidated Funds, which were eliminated in the U.S. GAAP consolidation but were included in the segment results, (ii) amounts attributable to non-controlling interests in consolidated entities, which were excluded from the segment results and (iii)

56

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

the reclassification of NGP X performance fees, which are included in investment income in U.S. GAAP financial statements. Adjustments to investment income (loss) also include the reclassification of earnings for the investments in NGP Management and its affiliates to the appropriate operating captions for the segment results, the exclusion of charges associated with the investment in NGP Management and its affiliates that are excluded from the segment results, and adjustments to reflect the Partnership’s share of Urbplan’s net losses as investment losses for the segment results. Adjustments to performance fee related compensation expense relate to certain tax expenses associated with performance fee compensation. Adjustments are also included in these financial statement captions to reflect the Partnership’s 55% economic interest in each of Claren Road, ESG and Vermillion.

(e) The Total Assets adjustment represents the addition of the assets of the Consolidated Funds that were eliminated in consolidation to arrive at the Partnership’s total assets.

19. Subsequent Events

In April 2015, the Board of Directors of the general partner of the Partnership declared a quarterly distribution of $0.33 per common unit to common unit holders of record at the close of business on May 15, 2015, payable on May 22, 2015.

57

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

20. Supplemental Financial Information

The following supplemental financial information illustrates the consolidating effects of the Consolidated Funds on the Partnership’s financial position as of March 31, 2015 and December 31, 2014 and results of operations for the three months ended March 31, 2015 and 2014. The supplemental statement of cash flows is presented without effects of the Consolidated Funds.

	As of March 31, 2015
	Consolidated Operating Entities			Consolidated Funds			Eliminations			Consolidated
	(Dollars in millions)
Assets
Cash and cash equivalents	$	1,024.8		$	—		$	—		$	1,024.8
Cash and cash equivalents held at Consolidated Funds	—			1,436.7			—			1,436.7
Restricted cash	41.0			—			—			41.0
Restricted cash and securities of Consolidated Funds	—			18.8			—			18.8
Accrued performance fees	3,780.1			—			(12.9		)	3,767.2
Investments	1,119.3			—			(175.1		)	944.2
Investments of Consolidated Funds	—			25,949.0			0.1			25,949.1
Due from affiliates and other receivables, net	218.3			—			(15.5		)	202.8
Due from affiliates and other receivables of Consolidated Funds, net	—			688.9			—			688.9
Receivables and inventory of a consolidated real estate VIE	185.0			—			—			185.0
Fixed assets, net	86.7			—			—			86.7
Deposits and other	57.7			3.2			—			60.9
Other assets of a consolidated real estate VIE	73.7			—			—			73.7
Intangible assets, net	399.3			—			—			399.3
Deferred tax assets	134.1			—			—			134.1
Total assets	$	7,120.0		$	28,096.6		$	(203.4	)	$	35,013.2
Liabilities and partners’ capital
Loans payable	$	38.4		$	—		$	—		$	38.4
3.875% senior notes due 2023	499.9			—			—			499.9
5.625% senior notes due 2043	606.8			—			—			606.8
Loans payable of Consolidated Funds	—			16,721.9			(167.3		)	16,554.6
Loans payable of a consolidated real estate VIE at fair value (principal amount of $214.8 million)	139.6			—			—			139.6
Accounts payable, accrued expenses and other liabilities	469.1			—			(79.2		)	389.9
Accrued compensation and benefits	2,202.0			—			—			2,202.0
Due to affiliates	191.3			0.2			—			191.5
Deferred revenue	196.7			—			(0.2		)	196.5
Deferred tax liabilities	105.0			—			—			105.0
Other liabilities of Consolidated Funds	—			1,751.3			(42.6		)	1,708.7
Other liabilities of a consolidated real estate VIE	105.4			—			—			105.4
Accrued giveback obligations	184.5			—			(7.9		)	176.6
Total liabilities	4,738.7			18,473.4			(297.2		)	22,914.9
Redeemable non-controlling interests in consolidated entities	8.0			3,931.9			—			3,939.9
Partners’ capital	528.0			(111.5		)	111.5			528.0
Accumulated other comprehensive income (loss)	(52.8		)	12.4			(10.0		)	(50.4		)
Partners’ capital appropriated for Consolidated Funds	—			134.6			(7.7		)	126.9
Non-controlling interests in consolidated entities	269.9			5,655.8			—			5,925.7
Non-controlling interests in Carlyle Holdings	1,628.2			—			—			1,628.2
Total partners’ capital	2,373.3			5,691.3			93.8			8,158.4
Total liabilities and partners’ capital	$	7,120.0		$	28,096.6		$	(203.4	)	$	35,013.2

58

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

	As of December 31, 2014
	Consolidated Operating Entities			Consolidated Funds			Eliminations			Consolidated
	(Dollars in millions)
Assets
Cash and cash equivalents	$	1,242.0		$	—		$	—		$	1,242.0
Cash and cash equivalents held at Consolidated Funds	—			1,551.1			—			1,551.1
Restricted cash	59.7			—			—			59.7
Restricted cash and securities of Consolidated Funds	—			14.9			—			14.9
Accrued performance fees	3,808.9			—			(13.3		)	3,795.6
Investments	1,114.9			—			(183.3		)	931.6
Investments of Consolidated Funds	—			26,028.7			0.1			26,028.8
Due from affiliates and other receivables, net	215.8			—			(16.4		)	199.4
Due from affiliates and other receivables of Consolidated Funds, net	—			1,213.2			—			1,213.2
Receivables and inventory of a consolidated real estate VIE	163.9			—			—			163.9
Fixed assets, net	75.4			—			—			75.4
Deposits and other	57.3			1.9			—			59.2
Other assets of a consolidated real estate VIE	86.4			—			—			86.4
Intangible assets, net	442.1			—			—			442.1
Deferred tax assets	131.0			—			—			131.0
Total assets	$	7,397.4		$	28,809.8		$	(212.9	)	$	35,994.3
Liabilities and partners’ capital
Loans payable	$	40.2		$	—		$	—		$	40.2
3.875% senior notes due 2023	499.9			—			—			499.9
5.625% senior notes due 2043	606.8			—			—			606.8
Loans payable of Consolidated Funds	—			16,219.8			(167.6		)	16,052.2
Loans payable of a consolidated real estate VIE at fair value (principal amount of $243.6 million)	146.2			—			—			146.2
Accounts payable, accrued expenses and other liabilities	446.8			—			(50.6		)	396.2
Accrued compensation and benefits	2,312.5			—			—			2,312.5
Due to affiliates	183.6			1.0			(0.4		)	184.2
Deferred revenue	93.9			—			(0.2		)	93.7
Deferred tax liabilities	112.2			—			—			112.2
Other liabilities of Consolidated Funds	—			2,548.0			(43.1		)	2,504.9
Other liabilities of a consolidated real estate VIE	84.9			—			—			84.9
Accrued giveback obligations	113.4			—			(9.0		)	104.4
Total liabilities	4,640.4			18,768.8			(270.9		)	23,138.3
Redeemable non-controlling interests in consolidated entities	8.4			3,753.1			—			3,761.5
Partners’ capital	566.0			(71.5		)	71.5			566.0
Accumulated other comprehensive income (loss)	(40.3		)	6.3			(5.0		)	(39.0		)
Partners’ capital appropriated for Consolidated Funds	—			193.0			(8.5		)	184.5
Non-controlling interests in consolidated entities	286.3			6,160.1			—			6,446.4
Non-controlling interests in Carlyle Holdings	1,936.6			—			—			1,936.6
Total partners’ capital	2,748.6			6,287.9			58.0			9,094.5
Total liabilities and partners’ capital	$	7,397.4		$	28,809.8		$	(212.9	)	$	35,994.3

59

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

	Three Months Ended March 31, 2015
	Consolidated Operating Entities			Consolidated Funds		Eliminations			Consolidated
	(Dollars in millions)
Revenues
Fund management fees	$	309.7		$	—	$	(40.2	)	$	269.5
Performance fees
Realized	326.0			—		0.8			326.8
Unrealized	254.5			—		(8.3		)	246.2
Total performance fees	580.5			—		(7.5		)	573.0
Investment income (loss)
Realized	(69.8		)	—		78.7			8.9
Unrealized	45.6			—		(47.7		)	(2.1		)
Investment income (loss)	(24.2		)	—		31.0			6.8
Interest and other income	6.5			—		(0.5		)	6.0
Interest and other income of Consolidated Funds	—			226.3		—			226.3
Revenue of a consolidated real estate VIE	55.2			—		—			55.2
Total revenues	927.7			226.3		(17.2		)	1,136.8
Expenses
Compensation and benefits
Base compensation	180.1			—		—			180.1
Equity-based compensation	89.9			—		—			89.9
Performance fee related
Realized	143.0			—		—			143.0
Unrealized	173.7			—		—			173.7
Total compensation and benefits	586.7			—		—			586.7
General, administrative and other expenses	116.8			—		—			116.8
Interest	14.6			—		—			14.6
Interest and other expenses of Consolidated Funds	—			292.8		(55.0		)	237.8
Interest and other expenses of a consolidated real estate VIE	70.0			—		—			70.0
Other non-operating expense	1.1			—		—			1.1
Total expenses	789.2			292.8		(55.0		)	1,027.0
Other income
Net investment gains of Consolidated Funds	—			507.8		(2.3		)	505.5
Income before provision for income taxes	138.5			441.3		35.5			615.3
Provision for income taxes	10.5			—		—			10.5
Net income	128.0			441.3		35.5			604.8
Net income (loss) attributable to non-controlling interests in consolidated entities	(37.7		)	—		476.8			439.1
Net income attributable to Carlyle Holdings	165.7			441.3		(441.3		)	165.7
Net income attributable to non-controlling interests in Carlyle Holdings	126.2			—		—			126.2
Net income attributable to The Carlyle Group L.P.	$	39.5		$	441.3	$	(441.3	)	$	39.5

60

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

	Three Months Ended March 31, 2014
	Consolidated Operating Entities			Consolidated Funds		Eliminations			Consolidated
	(Dollars in millions)
Revenues
Fund management fees	$	305.7		$	—	$	(45.4	)	$	260.3
Performance fees
Realized	257.4			—		(6.0		)	251.4
Unrealized	386.6			—		(17.5		)	369.1
Total performance fees	644.0			—		(23.5		)	620.5
Investment income (loss)
Realized	2.1			—		(2.1		)	—
Unrealized	7.8			—		(1.7		)	6.1
Total investment income	9.9			—		(3.8		)	6.1
Interest and other income	4.5			—		(0.7		)	3.8
Interest and other income of Consolidated Funds	—			250.7		—			250.7
Revenue of a consolidated real estate VIE	6.0			—		—			6.0
Total revenues	970.1			250.7		(73.4		)	1,147.4
Expenses
Compensation and benefits
Base compensation	204.6			—		—			204.6
Equity-based compensation	74.2			—		—			74.2
Performance fee related
Realized	108.7			—		—			108.7
Unrealized	221.6			—		—			221.6
Total compensation and benefits	609.1			—		—			609.1
General, administrative and other expenses	134.4			—		(0.1		)	134.3
Interest	12.2			—		—			12.2
Interest and other expenses of Consolidated Funds	—			339.8		(75.8		)	264.0
Interest and other expenses of a consolidated real estate VIE	49.2			—		—			49.2
Other non-operating expense	30.2			—		—			30.2
Total expenses	835.1			339.8		(75.9		)	1,099.0
Other income
Net investment gains of Consolidated Funds	—			426.9		(2.9		)	424.0
Income before provision for income taxes	135.0			337.8		(0.4		)	472.4
Provision for income taxes	16.0			—		—			16.0
Net income	119.0			337.8		(0.4		)	456.4
Net income (loss) attributable to non-controlling interests in consolidated entities	(12.9		)	—		337.4			324.5
Net income attributable to Carlyle Holdings	131.9			337.8		(337.8		)	131.9
Net income attributable to non-controlling interests in Carlyle Holdings	107.3			—		—			107.3
Net income attributable to The Carlyle Group L.P.	$	24.6		$	337.8	$	(337.8	)	$	24.6

61

The Carlyle Group L.P.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

	Three Months Ended March 31,
	2015			2014
	(Dollars in millions)
Cash flows from operating activities
Net income	$	128.0		$	119.0
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation and amortization	39.9			57.7
Equity-based compensation	89.9			74.2
Excess tax benefits related to equity-based compensation	(0.5		)	—
Non-cash performance fees	(278.8		)	(463.9		)
Other non-cash amounts	23.8			42.6
Investment loss (income)	27.3			(3.3		)
Purchases of investments and trading securities	(40.9		)	(69.1		)
Proceeds from the sale of investments and trading securities	283.4			411.2
Payments of contingent consideration	(3.3		)	(43.5		)
Change in deferred taxes, net	(0.3		)	1.4
Change in due from affiliates and other receivables	(7.8		)	(5.3		)
Change in receivables and inventory of a consolidated real estate VIE	(34.4		)	(0.8		)
Change in deposits and other	(6.3		)	(7.1		)
Change in other assets of a consolidated real estate VIE	15.8			11.5
Change in accounts payable, accrued expenses and other liabilities	(33.1		)	(32.3		)
Change in accrued compensation and benefits	(11.4		)	(57.3		)
Change in due to affiliates	12.0			(83.9		)
Change in other liabilities of a consolidated real estate VIE	31.9			7.3
Change in deferred revenue	106.9			133.5
Net cash provided by operating activities	342.1			91.9
Cash flows from investing activities
Change in restricted cash	18.3			84.5
Purchases of fixed assets, net	(17.4		)	(3.7		)
Acquisitions, net of cash acquired	—			(3.1		)
Net cash provided by investing activities	0.9			77.7
Cash flows from financing activities
Issuance of 5.625% senior notes due 2043, net of financing costs	—			210.8
Net payments on loans payable of a consolidated real estate VIE	(11.1		)	(9.5		)
Payments of contingent consideration	(0.5		)	(29.2		)
Excess tax benefits related to equity-based compensation	0.5			—
Distributions to common unitholders	(110.9		)	(70.4		)
Distributions to non-controlling interest holders in Carlyle Holdings	(403.6		)	(366.5		)
Contributions from non-controlling interest holders	53.7			52.2
Distributions to non-controlling interest holders	(44.7		)	(33.9		)
Net proceeds from issuance of common units, net of offering costs	—			449.5
Acquisition of non-controlling interests in Carlyle Holdings	—			(303.4		)
Change in due to/from affiliates financing activities	(5.2		)	1.6
Net cash used in financing activities	(521.8		)	(98.8		)
Effect of foreign exchange rate changes	(38.4		)	(3.1		)
(Decrease) increase in cash and cash equivalents	(217.2		)	67.7
Cash and cash equivalents, beginning of period	1,242.0			966.6
Cash and cash equivalents, end of period	$	1,024.8		$	1,034.3

62

Item 2.     Management's Discussion and Analysis of Financial Condition and Results of Operations

The following discussion analyzes the financial condition and results of operations of The Carlyle Group L.P. (the “Partnership”). Such analysis should be read in conjunction with the consolidated financial statements and the related notes included in this Quarterly Report on Form 10-Q and the Annual Report on Form 10-K for the year ended December 31, 2014.

Overview

We conduct our operations through four reportable segments: Corporate Private Equity, Global Market Strategies, Real Assets and Investment Solutions.

• Corporate Private Equity — Our Corporate Private Equity segment advises our 22 buyout and 10 growth capital funds, which seek a wide variety of investments of different sizes and growth potentials. As of March 31, 2015, our Corporate Private Equity segment had approximately $64 billion in AUM and approximately $39 billion in Fee-earning AUM.

• Global Market Strategies — Our Global Market Strategies segment advises a group of 70 funds that pursue investment opportunities across structured credit, distressed debt, corporate and energy mezzanine debt, middle-market and senior debt, as well as credit, emerging markets and commodities-focused hedge funds. As of March 31, 2015, our Global Market Strategies segment had approximately $36 billion in AUM and approximately $32 billion in Fee-earning AUM.

• Real Assets — Our Real Assets segment advises our nine U.S. and internationally focused real estate funds, our infrastructure fund, our two power funds, our international energy fund, as well as our five Legacy Energy funds (funds that we jointly advise with Riverstone). The segment also includes seven NGP management fee funds and three carry funds advised by NGP. As of March 31, 2015, our Real Assets segment had approximately $43 billion in AUM and approximately $28 billion in Fee-earning AUM.

• Investment Solutions — Our Investment Solutions segment advises a global private equity fund of funds program and related co-investment and secondary activities across 115 fund of funds vehicles. Our Investment Solutions segment is comprised of AlpInvest, one of the world's largest investors in private equity, Metropolitan, one of the largest managers of indirect investments in global real estate, which manages 26 fund of funds vehicles, and Diversified Global Asset Management Corporation (“DGAM”), a global manager of 15 fund of hedge funds vehicles. As of March 31, 2015, our Investment Solutions segment had approximately $49 billion in AUM and approximately $30 billion in Fee-earning AUM.

We earn management fees pursuant to contractual arrangements with the investment funds that we manage and fees for transaction advisory and oversight services provided to portfolio companies of these funds. We also typically receive a performance fee from an investment fund, which may be either an incentive fee or a special residual allocation of income, which we refer to as a carried interest, in the event that specified investment returns are achieved by the fund. Under U.S. generally accepted accounting principles (“U.S. GAAP”), we are required to consolidate some of the investment funds that we advise. However, for segment reporting purposes, we present revenues and expenses on a basis that deconsolidates these investment funds. Accordingly, our segment revenues primarily consist of fund management and related advisory fees, performance fees (consisting of incentive fees and carried interest allocations), investment income, including realized and unrealized gains on our investments in our funds and other trading securities, as well as interest and other income. Our segment expenses primarily consist of compensation and benefits expenses, including salaries, bonuses, performance payment arrangements, and equity-based compensation excluding awards granted in our initial public offering or in connection with acquisitions and strategic investments, and general and administrative expenses. Refer to Note 18 to the unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for more information on the differences between our financial results reported pursuant to U.S. GAAP and our financial results for segment reporting purposes.

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Our Family of Funds

The following chart presents the name (acronym), total capital commitments (in the case of our carry funds, structured credit funds, certain fund of funds vehicles, and the NGP management fee funds), assets under management (in the case of our hedge funds, fund of hedge funds vehicles, mutual fund and other structured products), gross assets (in the case of our business development companies), and vintage year of the active funds in each of our segments, as of March 31, 2015. We present total capital commitments (as opposed to assets under management) for our closed-end investment funds because we believe this metric provides the most useful information regarding the relative size and scale of such funds. In the case of our hedge funds, fund of hedge funds vehicles, mutual fund and other structured products which are open-ended and accordingly do not have permanent committed capital, we believe the most useful metric regarding relative size and scale is assets under management.

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Corporate Private Equity			Global Market Strategies			Real Assets
Buyout Carry Funds			Structured Credit Funds			Real Estate Carry Funds
Carlyle Partners (U.S.)			Cash CLO Funds			Carlyle Realty Partners (U.S.)
CP VI	$13.0 bn	2013	U.S.	$15.8 bn	1999-2015	CRP VII	$3.2 bn	2014
CP V	$13.7 bn	2007	Europe	€7.1 bn	2005-2015	CRP VI	$2.3 bn	2011
CP IV	$7.9 bn	2005	Middle Market CLO			CRP V	$3.0 bn	2006
Global Financial Services Partners			U.S.	$1.2 bn	2011	CRP IV	$950 mm	2005
CGFSP II	$1.0 bn	2013	Global Market Strategies Carry Funds			CRP III	$564 mm	2001
CGFSP I	$1.1 bn	2008	Carlyle Mezzanine Partners			Carlyle Europe Real Estate Partners
Carlyle Europe Partners			(Corporate Mezzanine)			CEREP III	€2.2 bn	2007
CEP IV	€2.0 bn	2014	CMP II	$553 mm	2008	CEREP II	€763 mm	2005
CEP III	€5.3 bn	2007	CMP I	$436 mm	2004	CEREP I	€427 mm	2002
CEP II	€1.8 bn	2003	Carlyle Strategic Partners			Carlyle Asia Real Estate Partners
Carlyle Asia Partners			(Distressed)			CAREP II	$486 mm	2008
CAP IV	$3.9 bn	2012	CSP III	$703 mm	2011	Natural Resources Funds
CBPF	RMB 2.1 bn	2010	CSP II	$1.4 bn	2007	Infrastructure Carry Fund
CAP III	$2.6 bn	2008	Carlyle Energy Mezzanine			CIP I	$1.1 bn	2006
CAP II	$1.8 bn	2006	Opportunities Fund			Power Carry Funds
CAP I	$750 mm	1998	CEMOF II	$1.3 bn	2015	CPOCP	$433 mm	2013
Carlyle Japan Partners			CEMOF I	$1.4 bn	2010	CPP II	$366 mm	2014
CJP III	¥77.3 bn	2013	Carlyle Asia Structured Credit Opportunities			International Energy Carry Fund
CJP II	¥165.6 bn	2006	CASCOF	$185 mm	2015	CIEP	$2.5 bn	2013
CJP I	¥50.0 bn	2001	Hedge Funds and Other Vehicles1			NGP Energy Carry Funds
Carlyle Mexico Partners			Long/Short Credit			NGP XI	$5.3 bn	2014
Mexico	$134 mm	2005	Claren Road			NGP X	$3.6 bn	2012
Carlyle MENA Partners			Opportunities Fund	$1.8 bn	2008	NGP Agribusiness Carry Fund
MENA I	$471 mm	2008	Claren Road			NGP GAP	$402 mm	2014
Carlyle South American Buyout Fund			Master Fund	$3.5 bn	2006	NGP Management Fee Funds
CSABF I	$776 mm	2009	Emerging Markets Strategies			Various3	$8.1 bn	2004-2007
Carlyle Sub-Saharan Africa Fund			Cross Border Equity Master Fund	$3.4 bn	2002	Legacy Energy Carry Funds
CSSAF I	$698 mm	2012	Domestic Opportunity Master Fund	$1.3 bn	2011	Carlyle/Riverstone Global Energy
Carlyle Peru Fund			Emerging Sovereign Group - Various	$0.5 bn	2002	Energy IV	$6.0 bn	2008
CPF I	$308 mm	2012	Commodities			Energy III	$3.8 bn	2005
Carlyle Global Partners			Vermillion - Various	$1.2 bn	2005-2014	Energy II	$1.1 bn	2003
CGP	$2.0 bn	2015	Quantitative Market Strategies			Carlyle/Riverstone Renewable Energy
Growth Carry Funds			Various	$86 mm	2014	Renew II	$3.4 bn	2008
Carlyle U.S. Venture/Growth Partners			Business Development Companies2			Renew I	$685 mm	2006
CEOF II	$997 mm	2015	Carlyle GMS Finance, Inc.	$806 mm	2013
CEOF I	$1.1 bn	2011	NF Investment Corp	$209 mm	2013
CUSGF III	$605 mm	2006
CVP II	$602 mm	2001	Investment Solutions
Carlyle Europe Technology Partners			AlpInvest
CETP III	€408 mm	2014	Fund of Private Equity Funds
CETP II	€522 mm	2008	47 vehicles	€39.9 bn	2000-2015
CETP I	€222 mm	2005	Secondary Investments
Carlyle Asia Venture/Growth Partners			35 vehicles	€10.5 bn	2000-2015
CAGP IV	$1.0 bn	2008	Co-Investments
CAGP III	$680 mm	2005	33 vehicles	€11.6 bn	2000-2015
Carlyle Cardinal Ireland			Metropolitan Real Estate
CCI	€292 mm	2014	Real Estate Fund of Funds
			26 vehicles	$2.8 bn	2003-2014
			Diversified Global Asset Management1
			Fund of Hedge Funds
			15 vehicles	$2.3 bn	2004-2014

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Note: All funds are closed-end and amounts shown represent total capital commitments as of March 31, 2015, unless otherwise noted. Certain of our recent vintage funds are currently in fundraising and total capital commitments are subject to change. 

(1) Open-ended hedge funds, a mutual fund and other pooled vehicles. Amounts represent AUM across all products as of March 31, 2015.

(2) Amounts represent gross assets as of March 31, 2015.

(3) Includes NGPC, NGP ETP I, NGP M&R, NGP ETP II, NGP VII, NGP VIII and NGP IX.

Trends Affecting our Business

Through the first three months of 2015, the U.S. economy appears to have slowed relative to 2014. The deceleration appears to be due to the increase in the foreign exchange value of the U.S. dollar and the decline in energy-related capital expenditures. Since the end of Q2 2014, the U.S. dollar appreciated by 20% against major currencies on a trade-weighted basis. Analysis from the Federal Reserve Bank of New York suggests that the appreciation of the dollar will slow U.S. GDP growth by 0.6% in 2015, due to a decline in net exports and domestic investment.

The rise in the dollar is expected to contribute to declining earnings among S&P 500 constituents by 3.2% in Q1 2015, in aggregate. The decline is mainly due to the translation of foreign sales into U.S. dollars and the more than 60% contraction in the earnings of oil and gas firms on a year over year basis. At the same time, the S&P 500 index rose 2.5% since the end of 2014 to new record highs during Q1 2015. The increase in corporate asset prices relative to operating earnings has pushed valuations to new cyclical highs, with the aggregate enterprise value of the S&P 500 rising to 12x trailing twelve months’ EBITDA.

Valuations also rose in Europe with the EuroStoxx Index rising by nearly 20% in response to the European Central Bank (ECB) asset purchase program. Much of the price increase, however, is tied to the depreciation of the exchange rate, which has resulted in increases in the domestic, Euro-denominated value of foreign sales. S&P analyst surveys suggest that earnings will increase by 14%, on average, among large European corporates in 2015, which we believe provides most of the explanation for the increase in equity prices observed to date.

Despite a slowing overall economy in China, it has had the world’s best performing stock market over the past twelve months, with the Shanghai Composite Index doubling between May 2014 and April 2015. Broad indices of Indian stocks increased by more than 20% over the same period. Both economic activity and corporate asset prices declined in Brazil, as rising public sector deficits and external funding needs forced policymakers to tighten fiscal and monetary policy. Against the backdrop of these market conditions, Carlyle’s carry fund portfolio increased by approximately 6% during the first quarter as our private portfolio appreciated 2% in the aggregate while our public portfolio appreciated 15%. The asset-weighted hedge fund performance of our reported funds was 2% for the quarter ended March 31, 2015.

Interest rates have continued to grind lower in advanced economies, led by the Euro area where ECB purchases have resulted in negative yields on German government securities maturing over the next seven years. The slowdown in the U.S. economy and the rise in the value of the dollar caused U.S. yields on the 5- to 7-year portion of the Treasury curve to decline by 0.25% since the start of the year. The timing of the first Federal Reserve rate hike implied by the Federal Funds and Eurodollars futures markets has been pushed out further into the future signaling a less than 10% chance of a June 2015 rate increase. While we have not yet seen significant negative developments in the availability of or rates on financing for our buyout transactions, in 2015 we continue to advise our investment professionals to take advantage of low rate financing and refinancing given the continuing possibility of market volatility or weakness that could affect rates and availability.

It is difficult to determine if recent volatility in the markets will continue, and, if so, what impact it will have on our diverse portfolio. Depending on short-term market conditions and regulatory reviews, exits could accelerate above our expectations or they could be delayed. Higher valuations, while potentially adversely impacting our investment pace, could also improve exit opportunities for our funds. During the first quarter, we invested $1.5 billion in new and existing investments in our carry funds that met our investment criteria and strategic objectives. We also capitalized on continuing high asset values and, as an opportunistic seller, realized proceeds of $4.6 billion in 102 investments and 34 carry funds during the quarter. While there can be no assurance that these exit and investment trends will continue, we remain focused on maximizing the value of our portfolio for our fund investors and our business.

Recent Transactions

In April 2015, the Board of Directors of our general partner declared a quarterly distribution of $0.33 per common unit to common unit holders of record at the close of business on May 15, 2015, payable on May 22, 2015.

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Consolidation of Certain Carlyle Funds and Variable Interest Entities

Pursuant to U.S. GAAP, we consolidate certain Carlyle sponsored funds, related co-investment entities and CLOs that we advise, which we refer to collectively as the Consolidated Funds, in our consolidated financial statements. These funds represent approximately 14% of our AUM as of March 31, 2015; 13% of our fund management fees for the three months ended March 31, 2015; and approximately 1% of our performance fees for the three months ended March 31, 2015.

We are not required under U.S. GAAP to consolidate in our financial statements most of the investment funds we advise because such funds provide their limited partners with the right to dissolve the fund without cause by a simple majority vote of the non-Carlyle affiliated limited partners, which overcomes the presumption of control by Carlyle. However, we consolidate certain CLOs that we advise as a result of the application of the accounting standards governing consolidations. As of March 31, 2015, our consolidated CLOs held approximately $18 billion of total assets and comprised 65% of the assets of the Consolidated Funds and 100% of the loans payable of the Consolidated Funds. As of March 31, 2015, our consolidated AlpInvest fund of funds vehicles had approximately $6 billion of total assets and comprised 20% of the assets of the Consolidated Funds. The remainder of the assets of the Consolidated Funds as of March 31, 2015 relate to our consolidated hedge funds and other consolidated funds. The assets and liabilities of the Consolidated Funds are generally held within separate legal entities and, as a result, the liabilities of the Consolidated Funds are non-recourse to us. For further information on consolidation of certain funds, see Note 2 to the unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q.

Generally, the consolidation of the Consolidated Funds has a gross-up effect on our assets, liabilities and cash flows but has no net effect on the net income attributable to the Partnership and partners’ capital. The majority of the net economic ownership interests of the Consolidated Funds are reflected as non-controlling interests in consolidated entities, redeemable non-controlling interests in consolidated entities, and partners’ capital appropriated for Consolidated Funds in the consolidated financial statements. For further information, see Note 2 to the unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q.

Because only a small portion of our funds are consolidated, the performance of the Consolidated Funds is not necessarily consistent with or representative of the combined performance trends of all of our funds.

In addition, as described in Note 17 to the unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q, we consolidate Urbplan, a Brazilian real estate portfolio company held by certain of our real estate investment funds. Due to the timing and availability of financial information of Urbplan, we consolidate the financial position and results of operations of Urbplan on a financial reporting lag of 90 days. As of March 31, 2015, our unaudited condensed consolidated financial statements included approximately $259 million of assets related to Urbplan, representing less than 1% of our consolidated total assets.

On February 18, 2015, the FASB issued ASU 2015-2, Consolidation (Topic 820): Amendments to the Consolidation Analysis. ASU 2015-2 provides a revised consolidation model for all reporting entities to use in evaluating whether they should consolidate certain legal entities. All legal entities will be subject to reevaluation under this revised consolidation model. The revised consolidation model, among other things, (i) modifies the evaluation of whether limited partnerships and similar legal entities are VIEs or voting interest entities, (ii) eliminates the presumption that a general partner should consolidate a limited partnership, and (iii) modifies the consolidation analysis of reporting entities that are involved with VIEs through fee arrangements and related party relationships. This guidance in ASU 2015-2 is effective for the Partnership beginning on January 1, 2016, however, early adoption is permitted. We are currently assessing the potential impact that this guidance will have on our consolidated financial statements.

Key Financial Measures

Our key financial measures are discussed in the following pages.

Revenues

Revenues primarily consist of fund management fees, performance fees, investment income, including realized and unrealized gains of our investments in our funds and other trading securities, as well as interest and other income. See Note 2 to the unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q for additional information regarding the manner in which management fees and performance fees are generated.

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Fund Management Fees. Fund management fees include (i) management fees and (ii) transaction and portfolio advisory fees. Management fees are fees we earn for advisory services we provide to funds in which we hold a general partner interest or with which we have an investment advisory or investment management agreement. Management fees are based on (a) third parties’ capital commitments to our investment funds, (b) third parties’ remaining capital invested in our investment funds at cost or at the lower of cost or aggregate remaining fair value, (c) gross assets, excluding cash and cash equivalents, (d) for the private equity and real estate fund of funds vehicles following the expiration of the commitment period or weighted-average investment period of such vehicles, the lower of cost or fair value of the capital invested, the net asset value for unrealized investments, or the contributions for unrealized investments, (e) the total par amount of assets for our CLOs and the aggregate principal amount of the notes of our other structured products, or (f) the net asset value (“NAV”) of certain of our investment funds, as described in our unaudited condensed consolidated financial statements. Additionally, management fees include catch-up management fees, which are episodic in nature and represent management fees charged to fund investors in subsequent closings of a fund which apply to the time period between the fee initiation date and the subsequent closing date.

Management fees for funds in our corporate private equity funds, closed-end carry funds in the global market strategies segment and real assets funds generally range from 1% to 2% of commitments during the investment period of the relevant fund. Large funds tend to have lower effective management fee rates, while smaller funds tend to have effective management fee rates approaching 2.0%. Following the expiration or termination of the investment period of such funds, the management fees generally step-down to between 0.6% and 2.0% generally on the lower of cost or fair value of capital invested; however, certain of our managed accounts base management fees at all times on contributions for unrealized investments or the current value of the investment. Depending upon the contracted terms of investment advisory or investment management and related agreements, these fees are called semiannually in advance and are recognized as earned over the subsequent six month period. As a result, cash on hand and deferred revenue will generally be higher at or around January and July, which are the semiannual due dates for management fees.

Management fees for our private equity and real estate fund of funds vehicles generally range from 0.3% to 1.0% on the vehicle’s capital commitments during the commitment fee period of the relevant fund or the weighted-average investment period of the underlying funds. Following the expiration of the commitment fee period or weighted-average investment period of such funds, the management fees generally range from 0.3% to 1.0% on the lower of cost or fair value of the capital invested, the NAV for unrealized investments, or the contributions for unrealized investments. The management fees for our fund of hedge funds vehicles generally range 0.2% to 1.5% of NAV. Management fees for our Investment Solutions segment are generally due quarterly and recognized over the related quarter.

Our hedge funds generally pay management fees quarterly that range from 1.5% to 2.0% of NAV per year. Management fees for our business development companies are due quarterly in arrears at annual rates that range from 0.25% to 1.0% of gross assets, excluding cash and cash equivalents. Management fees for our CLOs and other structured products typically range from 0.15% to 1.0% on the total par amount of assets or the aggregate principal amount of the notes in the CLO and are due quarterly or semiannually based on the terms and recognized over the relevant period. Our management fees for our CLOs/structured products and credit opportunities funds are governed by indentures and collateral management agreements.

With respect to Claren Road, ESG, and Vermillion, we retain a specified percentage of the management fees of the businesses based on our economic ownership in the management companies of 55%. Management fees are not subject to repayment but may be offset to the extent that other fees are earned as described below under “—Transaction and Portfolio Advisory Fee.”

Management fees attributable to Carlyle Partners VI, L.P. (“CP VI”), our sixth U.S. buyout fund with approximately $12.0 billion of Fee-earning AUM as of March 31, 2015, were approximately 15% of total management fees recognized during the three months ended March 31, 2015 and 2014. No other fund generated over 10% of total management fees in the periods presented.

Transaction and Portfolio Advisory Fees. Transaction and portfolio advisory fees are fees we receive for the transaction and portfolio advisory services we provide to our portfolio companies. When covered by separate contractual agreements, we recognize transaction and portfolio advisory fees for these services when the service has been provided and collection is reasonably assured. We are required to offset our fund management fees earned by a percentage of the transaction and advisory fees earned, which we refer to as the “rebate offsets.” Such rebate offset percentages generally approximate 80% of the fund's portion of the transaction and advisory fees earned. The recognition of portfolio advisory fees and transactions fees can be volatile as they are primarily generated by investment activity within our funds, and therefore are impacted by our investment pace. We have received and expect to continue to receive requests from a variety of investors and groups representing investors to increase the percentage of transaction and advisory fees we share with our investors in future funds; to the extent that we accommodate such requests on future funds, the rebate offset percentages would increase relative to historical levels.

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Performance Fees. Performance fees consist principally of the special residual allocation of profits to which we are entitled, commonly referred to as carried interest, from certain of our investment funds, which we refer to as the “carry funds.” We are generally entitled to a 20% allocation (or 10% to 20% on external coinvestment vehicles, with some earning no carried interest, or approximately 2% to 10% in the case of most of our fund of funds vehicles) of the net realized income or gain as a carried interest after returning the invested capital, the allocation of preferred returns of generally 8% to 9% and the return of certain fund costs (subject to catch-up provisions as set forth in the fund limited partnership agreement). Carried interest revenue, which is a component of performance fees in our consolidated financial statements, is recognized by Carlyle upon appreciation of the valuation of our funds’ investments above certain return hurdles as set forth in each respective partnership agreement and is based on the amount that would be due to us pursuant to the fund partnership agreement at each period end as if the funds were liquidated at such date. Accordingly, the amount of carried interest recognized as performance fees reflects our share of the fair value gains and losses of the associated funds’ underlying investments measured at their then-current fair values. As a result, the performance fees earned in an applicable reporting period are not indicative of any future period. Carried interest is ultimately realized and distributed when: (i) an underlying investment is profitably disposed of, (ii) certain costs borne by the limited partner investors have been reimbursed, (iii) the investment fund’s cumulative returns are in excess of the preferred return and (iv) we have decided to collect carry rather than return additional capital to limited partner investors. Our decision to realize carry considers such factors as the level of embedded valuation gains, the portion of the fund invested, the portion of the fund returned to limited partner investors, and the length of time the fund has been in carry, as well as other qualitative measures. The portion of performance fees that are realized and unrealized in each period are separately reported in our statement of operations.

Under our arrangements with the historical owners and management team of AlpInvest, we generally do not retain any carried interest in respect of the historical investments and commitments to our fund of funds vehicles that existed as of July 1, 2011 (including any options to increase any such commitments exercised after such date). We are entitled to 15% of the carried interest in respect of commitments from the historical owners of AlpInvest for the period between 2011 and 2020 and 40% of the carried interest in respect of all other commitments (including all future commitments from third parties). In certain instances, carried interest associated with the fund of funds vehicles is subject to entity level income taxes in the Netherlands.

Our performance fees are generated by a diverse set of funds with different vintages, geographic concentration, investment strategies and industry specialties. For an explanation of the fund acronyms used throughout this Management’s Discussion and Analysis of Financial Condition and Results of Operations section, refer to “— Our Family of Funds.”

Performance fees from Carlyle Europe Partners III, L.P. (“CEP III”), our third Europe buyout fund, Carlyle Partners V, L.P. (“CP V”), our fifth U.S. buyout fund, Carlyle Partners IV, L.P. (“CP IV”), our fourth U.S. buyout fund, and Carlyle/Riverstone Global Energy and Power Fund III, L.P. (“Energy III”), with total AUM of approximately $5.7 billion, $14.7 billion, $1.7 billion and $1.2 billion, respectively, were $160.1 million, $158.6 million, $80.0 million, and $(65.0) million, respectively, for the three months ended March 31, 2015. Performance fees from CP V and CEP III were $249.2 million and $163.9 million, respectively, for the three months ended March 31, 2014. No other fund generated over 10% of performance fees in the periods presented.

Realized carried interest may be clawed back or given back to the fund if the fund’s investment values decline below certain return hurdles, which vary from fund to fund. When the fair value of a fund’s investments remains constant or falls below certain return hurdles, previously recognized performance fees are reversed. In all cases, each investment fund is considered separately in evaluating carried interest and potential giveback obligations. For any given period, carried interest income could thus be negative; however, cumulative performance fees can never be negative over the life of a fund. In addition, we are not obligated to pay guaranteed returns or hurdles. If upon a hypothetical liquidation of a fund’s investments at the then-current fair values, previously recognized and distributed carried interest would be required to be returned, a liability is established in our financial statements for the potential giveback obligation. As discussed below, each individual recipient of realized carried interest typically signs a guarantee agreement or partnership agreement that personally obligates such person to return his/her pro rata share of any amounts of realized carried interest previously distributed that are later clawed back. Accordingly, carried interest as performance fee compensation is subject to return to the Partnership in the event a giveback obligation is funded. Generally, the actual giveback liability, if any, does not become due until the end of a fund’s life.

In addition to the carried interest from our carry funds, we are also entitled to receive incentive fees or allocations from certain of our Global Market Strategies funds when the return on AUM exceeds previous calendar-year ending or date-of-investment high-water marks. Our hedge funds generally pay annual incentive fees or allocations equal to 20% of the fund’s profits for the year, subject to a high-water mark. The high-water mark is the highest historical NAV attributable to a fund investor’s account on which incentive fees were paid and means that we will not earn incentive fees with respect to such fund investor for a year if the NAV of such investor’s account at the end of the year is lower that year than any prior year-end NAV or the NAV at the date of such fund investor’s investment, generally excluding any contributions and redemptions for purposes

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of calculating NAV. In these arrangements, incentive fees are recognized when the performance benchmark has been achieved based on the hedge funds’ then-current fair value and are included in performance fees in our consolidated statements of operations. These incentive fees are a component of performance fees in our consolidated financial statements and are treated as accrued until paid to us.

For any given period, performance fee revenue on our statement of operations may include reversals of previously recognized performance fees due to a decrease in the value of a particular fund that results in a decrease of cumulative performance fees earned to date. Since fund return hurdles are cumulative, previously recognized performance fees also may be reversed in a period of appreciation that is lower than the particular fund’s hurdle rate. For the three months ended March 31, 2015 and 2014, the reversals of performance fees were $85.6 million and $71.1 million, respectively.

As of March 31, 2015, accrued performance fees and accrued giveback obligations were approximately $3.8 billion and $176.6 million, respectively, after amounts eliminated related to the Consolidated Funds. Each balance assumes a hypothetical liquidation of the funds’ investments at March 31, 2015 at their then current fair values. These assets and liabilities will continue to fluctuate in accordance with the fair values of the fund investments until they are realized.

In addition, realized performance fees may be reversed in future periods to the extent that such amounts become subject to a giveback obligation. If at March 31, 2015, all investments held by our carry funds were deemed worthless, the amount of realized and previously distributed performance fees subject to potential giveback would be approximately $1.4 billion on an after-tax basis where applicable. See the related discussion of “Contingent Obligations (Giveback)” within “— Liquidity and Capital Resources.” Since Carlyle's inception, we have repaid a total of approximately $46 million in aggregate giveback obligations, which was funded primarily through collection of employee receivables related to giveback obligations and from non-controlling interests for their portion of the obligation.

As described above, each investment fund is considered separately in evaluating carried interest and potential giveback obligations. As a result, performance fees within funds will continue to fluctuate primarily due to certain investments within each fund constituting a material portion of the carry in that fund. Additionally, the fair value of investments in our funds may have substantial fluctuations from period to period.

In addition, in our discussion of our non-GAAP results, we use the term “net performance fees” to refer to the performance fees from our funds net of the portion allocated to our investment professionals and certain tax expenses associated with carried interest attributable to certain partners and employees, which are reflected as performance fee related compensation expense. We use the term “realized net performance fees” to refer to realized performance fees from our funds, net of the portion allocated to our investment professionals and certain tax expenses associated with carried interest attributable to certain partners and employees, which are reflected as realized performance fee related compensation expense. See “— Non-GAAP Financial Measures” for the amount of realized and unrealized performance fees recognized each period. See “— Segment Analysis” for the realized and unrealized performance fees by segment and related discussion for each period.

Fair Value Measurement. U.S. GAAP establishes a hierarchal disclosure framework which ranks the observability of market price inputs used in measuring financial instruments at fair value. The observability of inputs is impacted by a number of factors, including the type of financial instrument, the characteristics specific to the financial instrument and the state of the marketplace, including the existence and transparency of transactions between market participants. Financial instruments with readily available quoted prices, or for which fair value can be measured from quoted prices in active markets, will generally have a higher degree of market price observability and a lesser degree of judgment applied in determining fair value.

Financial instruments measured and reported at fair value are classified and disclosed based on the observability of inputs used in the determination of fair values, as follows:

Level I – inputs to the valuation methodology are quoted prices available in active markets for identical instruments as of the reporting date. The type of financial instruments included in Level I include unrestricted securities, including equities and derivatives, listed in active markets. We do not adjust the quoted price for these instruments, even in situations where we hold a large position and a sale could reasonably impact the quoted price.

Level II – inputs to the valuation methodology are other than quoted prices in active markets, which are either directly or indirectly observable as of the reporting date. The type of financial instruments in this category includes less liquid and restricted securities listed in active markets, securities traded in other than active markets, government and agency securities, and certain over-the-counter derivatives where the fair value is based on observable inputs. Investments in hedge funds are classified in this category when their net asset value is redeemable without significant restriction.

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Level III – inputs to the valuation methodology are unobservable and significant to overall fair value measurement. The inputs into the determination of fair value require significant management judgment or estimation. Financial instruments that are included in this category include investments in privately-held entities, non-investment grade residual interests in securitizations, collateralized loan obligations, and certain over-the-counter derivatives where the fair value is based on unobservable inputs. Investments in fund of funds are generally included in this category.

In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the determination of which category within the fair value hierarchy is appropriate for any given financial instrument is based on the lowest level of input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the financial instrument.

The table below summarizes the valuation of investments and other financial instruments included within our AUM, by segment and fair value hierarchy levels, as of March 31, 2015 (amounts in millions):

	As of March 31, 2015
	Corporate Private Equity		Global Market Strategies		Real Assets		Investment Solutions			Total
Consolidated Results
Level I	$	14,301	$	7,128	$	5,595	$	899		$	27,875
Level II	178		2,626		601		1,312			4,836
Level III	24,513		21,765		18,203		31,699			96,231
Total Fair Value	38,992		31,519		24,399		33,910			128,942
Other Net Asset Value	217		1,991		1,776		(584		)	3,278
Total AUM, Excluding Available Capital Commitments	39,209		33,510		26,175		33,326			132,220
Available Capital Commitments	24,839		2,826		16,682		16,092			60,439
Total AUM	$	64,048	$	36,336	$	42,857	$	49,418		$	192,659

In certain cases, debt and equity securities are valued on the basis of prices from an orderly transaction between market participants provided by reputable dealers or pricing services. In determining the value of a particular investment, pricing services may use certain information with respect to transactions in such investments, quotations from dealers, pricing matrices, market transactions in comparable investments and various relationships between investments.

Investment professionals with responsibility for the underlying investments are responsible for preparing the investment valuations pursuant to the policies, methodologies and templates prepared by our valuation group, which is a team made up of dedicated valuation professionals reporting to our chief accounting officer. The valuation group is responsible for maintaining our valuation policy and related guidance, templates and systems that are designed to be consistent with the guidance found in U.S. GAAP. These valuations, inputs and preliminary conclusions are reviewed by the fund accounting teams. The valuations are then reviewed and approved by the respective fund valuation subcommittees, which are comprised of the respective fund head(s), segment head, chief financial officer and chief accounting officer, as well as members from the valuation group. The valuation group compiles the aggregate results and significant matters and presents them for review and approval by the global valuation committee, which is comprised of our co-chief executive officers, co-presidents and co-chief operating officers, chief risk officer, chief financial officer, chief accounting officer, deputy chief investment officers for Corporate Private Equity, the business segment heads, and observed by the chief compliance officer, the director of internal audit, and our audit committee. Additionally, each quarter a sample of valuations is reviewed by external valuation firms.

In the absence of observable market prices, we value our investments using valuation methodologies applied on a consistent basis. For some investments little market activity may exist. Management’s determination of fair value is then based on the best information available in the circumstances and may incorporate management’s own assumptions and involves a significant degree of judgment, taking into consideration a combination of internal and external factors, including the appropriate risk adjustments for non-performance and liquidity risks. Investments for which market prices are not observable include private investments in the equity of operating companies and real estate properties, and certain debt positions. The

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valuation technique for each of these investments is described in Note 4 of our unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q.

Investment Income and Interest and Other Income. Investment income and interest and other income represent the unrealized and realized gains and losses on our principal investments, including our investments in Carlyle funds that are not consolidated, our equity method investments and other principal investments, as well as any interest and other income. Investment income (loss) also includes the related amortization of the basis difference between the carrying value of our investment and our share of the underlying net assets of the investee, as well as the compensation expense associated with compensatory arrangements provided by us to employees of our equity method investee. Realized investment income (loss) is recorded when we redeem all or a portion of our investment or when we receive or are due cash income, such as dividends or distributions. A realized investment loss is also recorded when an investment is deemed to be worthless. Unrealized investment income (loss) results from changes in the fair value of the underlying investment, as well as the reversal of previously recognized unrealized gains (losses) at the time an investment is realized.

Interest and Other Income of Consolidated Funds. Interest and other income of Consolidated Funds primarily represents the interest earned on CLO assets. However, the Consolidated Funds are not the same entities in all periods presented and may change in future periods due to changes in U.S. GAAP, changes in fund terms and terminations of funds.

Revenue of a Consolidated Real Estate VIE. Revenue of a consolidated real estate VIE consists of revenue generated by Urbplan, which primarily is revenue earned for land development services using the completed contract method and investment income earned on Urbplan’s investments. Under the completed contract method of revenue recognition, revenue is not recognized until the period in which the land development services contract is completed.

Net Investment Gains (Losses) of Consolidated Funds. Net investment gains (losses) of Consolidated Funds measures the change in the difference in fair value between the assets and the liabilities of the Consolidated Funds. A gain (loss) indicates that the fair value of the assets of the Consolidated Funds appreciated more (less), or depreciated less (more), than the fair value of the liabilities of the Consolidated Funds. A gain or loss is not necessarily indicative of the investment performance of the Consolidated Funds and does not impact the management or incentive fees received by Carlyle for its management of the Consolidated Funds. The portion of the net investment gains (losses) of Consolidated Funds attributable to the limited partner investors is allocated to non-controlling interests. Therefore a gain or loss is not expected to have a material impact on the revenues or profitability of the Partnership. Moreover, although the assets of the Consolidated Funds are consolidated onto our balance sheet pursuant to U.S. GAAP, ultimately we do not have recourse to such assets and such liabilities are generally non-recourse to us. Therefore, a gain or loss from the Consolidated Funds generally does not impact the assets available to our equity holders.

Expenses

Compensation and Benefits. Compensation includes salaries, bonuses, equity-based compensation, and performance payment arrangements. Bonuses are accrued over the service period to which they relate.

We recognize as compensation expense the portion of performance fees that are due to our employees, senior Carlyle professionals, and operating executives in a manner consistent with how we recognize the performance fee revenue. These amounts are accounted for as compensation expense in conjunction with the related performance fee revenue and, until paid, are recognized as a component of the accrued compensation and benefits liability. Compensation in respect of performance fees is paid when the related performance fees are realized, and not when such performance fees are accrued. The funds do not have a uniform allocation of performance fees to our employees, senior Carlyle professionals and operating executives. Therefore, for any given period, the ratio of performance fee compensation to performance fee revenue may vary based on the funds generating the performance fee revenue for that period and their particular allocation percentages.

In addition, we have implemented various equity-based compensation arrangements that require senior Carlyle professionals and other employees to vest ownership of a portion of their equity interests over a service period of up to six years, which under U.S. GAAP will result in compensation charges over current and future periods. Further, in order to recruit and retain existing and future senior Carlyle professionals and other employees, we have implemented additional equity-based compensation programs that have resulted in increases to our equity-based compensation expenses, which is a trend that is expected to continue in the future as we increase the use of deferred restricted common units. For example, in February 2015, we granted approximately 5 million deferred restricted common units across a significant number of our employees for a total estimated grant-date fair value of approximately $119 million; these awards vest over a period of 18 to 42 months. Compensation charges associated with the equity-based compensation grants issued in our initial public offering in May 2012 or grants issued in acquisitions or strategic investments are excluded from our calculation of Economic Net Income.

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Compensation charges associated with all equity-based compensation grants are excluded from Fee Related Earnings and Distributable Earnings.

We expect that we will hire additional individuals and that overall compensation levels will correspondingly increase, which will result in an increase in compensation and benefits expense. As a result of recent acquisitions, we have charges associated with contingent consideration taking the form of earn-outs and profit participation, some of which are reflected as compensation expense. Our fundraising has increased in recent periods and, as a result, our compensation expense increased in periods in which we closed on increased levels of new capital commitments. Amounts due to employees related to such fundraising will be expensed when earned even though the benefit of the new capital and related fees will be reflected in operations over the life of the related fund.

General, Administrative and Other Expenses. General, administrative, and other expenses include occupancy and equipment expenses and other expenses, which consist principally of professional fees, including those related to our global regulatory compliance program, external costs of fundraising, travel and related expenses, communications and information services, depreciation and amortization and foreign currency transactions. We expect that general, administrative and other expenses will vary due to infrequently occurring or unusual items. Also, in periods of significant fundraising, to the extent that we use third parties to assist in our fundraising efforts, our general, administrative and other expenses may increase accordingly. Additionally, we anticipate that general, administrative and other expenses will fluctuate from period to period due to the impact of foreign exchange transactions.

We also expect to incur greater expenses in the future related to our recent acquisitions including amortization of acquired intangibles, earn-outs to equity holders and fair value adjustments on contingent consideration issued, as well as related to our global compliance efforts.

Interest and Other Expenses of Consolidated Funds. The interest and other expenses of Consolidated Funds consist primarily of interest expenses related primarily to our CLO loans, professional fees and other third-party expenses.

Interest and Other Expenses of a Consolidated Real Estate VIE. Interest and other expenses of a consolidated real estate VIE reflect expenses incurred by Urbplan, consisting primarily of interest expense, general and administrative expenses, compensation and benefits, and costs associated with land development services. Also included in this caption is the change in our estimate of the fair value of Urbplan’s loans payable during the period.

Income Taxes. The Carlyle Holdings partnerships and their subsidiaries primarily operate as pass-through entities for U.S. income tax purposes and record a provision for state and local income taxes for certain entities based on applicable laws and a provision for foreign income taxes for certain foreign entities. In addition, Carlyle Holdings I GP Inc. is subject to additional entity-level taxes that are reflected in our consolidated financial statements.

Income taxes for foreign entities are accounted for using the liability method of accounting. Under this method, deferred tax assets and liabilities are recognized for the expected future tax consequences of differences between the carrying amounts of assets and liabilities and their respective tax basis, using currently enacted tax rates. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period in which the change is enacted. Deferred tax assets are reduced by a valuation allowance when it is more likely than not that some or all of the deferred tax assets will not be realized.

In the normal course of business, we are subject to examination by federal and certain state, local and foreign tax regulators. As of March 31, 2015, our U.S. federal income tax returns for the years 2011 through 2014 are open under the normal three-year statute of limitations and therefore subject to examination. State and local tax returns are generally subject to audit from 2010 to 2014. Foreign tax returns are generally subject to audit from 2007 to 2014. Certain of our affiliates are currently under audit by federal, state and foreign tax authorities.

Non-controlling Interests in Consolidated Entities. Non-controlling interests in consolidated entities represent the component of equity in consolidated entities not held by us. These interests are adjusted for general partner allocations and by subscriptions and redemptions in hedge funds which occur during the reporting period. Non-controlling interests related to hedge funds are subject to quarterly or monthly redemption by investors in these funds following the expiration of a specified period of time or may be withdrawn subject to a redemption fee in the hedge funds during the period when capital may not be withdrawn. As limited partners in these types of funds have been granted redemption rights, amounts relating to third-party interests in such consolidated funds are presented as redeemable non-controlling interests in consolidated entities within the consolidated balance sheets. When redeemable amounts become legally payable to investors, they are classified as a liability and included in other liabilities of Consolidated Funds in the consolidated balance sheets.

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We record significant non-controlling interests in Carlyle Holdings relating to the ownership interests of the limited partners of the Carlyle Holdings partnerships. The Partnership, through wholly owned subsidiaries, is the sole general partner of Carlyle Holdings. Accordingly, the Partnership consolidates the financial position and results of operations of Carlyle Holdings into its financial statements, and the other ownership interests in Carlyle Holdings are reflected as a non-controlling interest in the Partnership’s financial statements.

Non-GAAP Financial Measures

Economic Net Income. Economic net income or “ENI,” is a key performance benchmark used in our industry. ENI represents segment net income which includes certain tax expense associated with performance fee compensation and excludes the impact of all other income taxes, acquisition-related items including amortization of acquired intangibles and contingent consideration taking the form of earn-outs, charges associated with equity-based compensation grants issued in May 2012 upon completion of the initial public offering or grants issued in acquisitions or strategic investments, corporate actions and infrequently occurring or unusual events. We believe the inclusion or exclusion of these items provides investors with a meaningful indication of our core operating performance. For segment reporting purposes, revenues and expenses, and, accordingly, segment net income, are presented on a basis that deconsolidates the Consolidated Funds. Total Segment ENI equals the aggregate of ENI for all segments. ENI is evaluated regularly by management in making resource deployment decisions and in assessing performance of our four segments and for compensation. We believe that reporting ENI is helpful to understanding our business and that investors should review the same supplemental financial measure that management uses to analyze our segment performance. This measure supplements and should be considered in addition to, and not in lieu of, the results of operations discussed further under “Consolidated Results of Operations” prepared in accordance with U.S. GAAP.

Distributable Earnings. Distributable Earnings is derived from our segment reported results and is an additional measure to assess performance and amounts potentially available for distribution from Carlyle Holdings to its equity holders. Distributable Earnings, which is a non-GAAP measure, is intended to show the amount of net realized earnings without the effects of consolidation of the Consolidated Funds. Distributable Earnings is total ENI less net performance fees and investment income plus realized net performance fees, realized investment income, and equity-based compensation expense.

Fee Related Earnings. Fee Related Earnings is a component of Distributable Earnings and is used to measure our operating profitability exclusive of performance fees, investment income from investments in our funds, performance fee-related compensation, and equity-based compensation expense. Accordingly, Fee Related Earnings reflect the ability of the business to cover direct base compensation and operating expenses from fee revenues other than performance fees. Fee Related Earnings are reported as part of our segment results. We use Fee Related Earnings from operations to measure our profitability from fund management fees.

Operating Metrics

We monitor certain operating metrics that are common to the alternative asset management industry.

Fee-earning Assets under Management

Fee-earning assets under management or Fee-earning AUM refers to the assets we manage or advise from which we derive recurring fund management fees. Our Fee-earning AUM generally equals the sum of:

(a) for substantially all carry funds and certain co-investment vehicles where the original investment period has not expired and for Metropolitan fund of funds vehicles during the weighted-average investment period of the underlying funds, the amount of limited partner capital commitments, for AlpInvest fund of funds vehicles, the amount of external investor capital commitments during the commitment fee period, and for the NGP management fee funds and certain carry funds advised by NGP, the amount of investor capital commitments before the first investment realization (see “Fee-earning AUM based on capital commitments” in the table below for the amount of this component at each period);

(b) for substantially all carry funds and certain co-investment vehicles where the original investment period has expired and for Metropolitan fund of funds vehicles after the expiration of the weighted-average investment period of the underlying funds, the remaining amount of limited partner invested capital, and for the NGP management fee funds and certain carry funds advised by NGP where the first investment has been realized, the amount of partner commitments less realized and written-off investments (see “Fee-earning AUM based on invested capital” in the table below for the amount of this component at each period);

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(c) the amount of aggregate fee-earning collateral balance at par of our collateralized loan obligations (“CLOs”), as defined in the fund indentures (typically exclusive of equities and defaulted positions) as of the quarterly cut-off date for each CLO, and the aggregate principal amount of the notes of our other structured products (see “Fee-earning AUM based on collateral balances, at par” in the table below for the amount of this component at each period);

(d) the net asset value of our mutual fund and the external investor portion of the net asset value (pre-redemptions and subscriptions) of our long/short credit funds, emerging markets, multi-product macroeconomic, fund of hedge funds vehicles and other hedge funds (see “Fee-earning AUM based on net asset value” in the table below for the amount of this component at each period);

(e) the gross assets (including assets acquired with leverage), excluding cash and cash equivalents of our business development companies and certain carry funds; and

(f) for AlpInvest fund of funds vehicles where the commitment fee period has expired, and certain carry funds where the investment period has expired, the lower of cost or fair value of invested capital (see “Fee-earning AUM based on lower of cost or fair value and other” in the table below for the amount of this component at each period).

The table below details Fee-earning AUM by its respective components at each period.

	As of March 31,
	2015		2014
Consolidated Results	(Dollars in millions)
Components of Fee-earning AUM
Fee-earning AUM based on capital commitments (1)	$	40,855	$	38,637
Fee-earning AUM based on invested capital (2)	37,674		44,328
Fee-earning AUM based on collateral balances, at par (3)	17,701		17,212
Fee-earning AUM based on net asset value (4)	12,844		16,900
Fee-earning AUM based on lower of cost or fair value and other (5)	20,338		25,011
Balance, End of Period	$	129,412	$	142,088

(1) Reflects limited partner capital commitments where the original investment period, weighted-average investment period, or commitment fee period has not expired.

(2) Reflects limited partner invested capital and includes amounts committed to or reserved for investments for certain Real Assets and Investment Solutions funds.

(3) Represents the amount of aggregate Fee-earning collateral balances and principal balances, at par, for our CLOs/structured products.

(4) Reflects the net asset value (pre-redemptions and subscriptions) of our hedge funds, mutual fund and fund of hedge funds vehicles.

(5) Includes funds with fees based on gross asset value.

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The table below provides the period to period rollforward of Fee-earning AUM.

	Three months ended March 31,
	2015			2014
Consolidated Results	(Dollars in millions)
Fee-earning AUM Rollforward
Balance, Beginning of Period	$	135,580		$	139,949
Acquisitions	—			2,894
Inflows, including Fee-paying Commitments (1)	4,054			1,941
Outflows, including Distributions (2)	(4,444		)	(3,718		)
Subscriptions, net of Redemptions (3)	(2,096		)	75
Changes in CLO collateral balances (4)	726			719
Market Appreciation/(Depreciation) (5)	114			251
Foreign Exchange and other (6)	(4,522		)	(23		)
Balance, End of Period	$	129,412		$	142,088

(1) Inflows represent limited partner capital raised and capital invested by our carry funds, NGP management fee funds and fund of funds vehicles outside the investment period, weighted-average investment period, or commitment fee period. Inflows do not include amounts raised of $10.2 billion for which fees have not yet commenced.

(2) Outflows represent limited partner distributions from our carry funds and fund of funds vehicles and changes in basis for our carry funds and fund of funds vehicles where the original investment period, weighted-average investment period, or commitment fee period has expired.

(3) Represents the net result of subscriptions to and redemptions from our hedge funds, mutual fund and fund of hedge funds vehicles.

(4) Represents the change in the aggregate Fee-earning collateral balances and principal balances at par of our CLOs/structured products, as of the quarterly cut-off dates.

(5) Market Appreciation/ (Depreciation) represents changes in the net asset value of our hedge funds, mutual fund and fund of hedge funds vehicles, and realized and unrealized gains (losses) on portfolio investments in our carry funds and fund of funds vehicles based on the lower of cost or fair value.

(6) Includes activity of funds with fees based on gross asset value. Represents the impact of foreign exchange rate fluctuations on the translation of our non-U.S. dollar denominated funds. Activity during the period is translated at the average rate for the period. Ending balances are translated at the spot rate as of the period end.

Refer to “— Segment Analysis” for a detailed discussion by segment of the activity affecting Fee-earning AUM for each of the periods presented by segment.

Assets under Management

Assets under management or AUM refers to the assets we manage or advise. Our AUM equals the sum of the following:

(a) the fair value of the capital invested in Carlyle carry funds, co-investment vehicles, NGP management fee funds and fund of funds vehicles plus the capital that Carlyle is entitled to call from investors in those funds and vehicles (including Carlyle commitments to those funds and vehicles and those of senior Carlyle professionals and employees) pursuant to the terms of their capital commitments to those funds and vehicles;

(b) the amount of aggregate collateral balance and principal cash at par or aggregate principal amount of the notes of our CLOs and other structured products (inclusive of all positions);

(c) the net asset value (pre-redemptions and subscriptions) of our long/short credit, emerging markets, multi-product macroeconomic, fund of hedge funds vehicles, mutual fund and other hedge funds; and

(d) the gross assets (including assets acquired with leverage) of our business development companies.

Our carry funds are closed-ended funds and investors are generally not able to redeem their interests under the fund partnership agreements.

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We include in our calculation of AUM and Fee-earning AUM certain energy and renewable resources funds that we jointly advise with Riverstone and certain NGP management fee funds and carry funds that are advised by NGP. Although we include all capital commitments to NGP XI in our assets under management calculation, for certain limited partners we will only include invested capital for NGP XI in our Fee-earning AUM calculation until early 2016 when we will be entitled to charge management fees based on commitments less realized and written-off investments.

For our carry funds, co-investment vehicles, fund of funds vehicles, and NGP management fee funds, total AUM includes the fair value of the capital invested, whereas Fee-earning AUM includes the amount of capital commitments or the remaining amount of invested capital, depending on whether the original investment period for the fund has expired. As such, Fee-earning AUM may be greater than total AUM when the aggregate fair value of the remaining investments is less than the cost of those investments.

Our calculations of Fee-earning AUM and AUM may differ from the calculations of other alternative asset managers and, as a result, this measure may not be comparable to similar measures presented by others. In addition, our calculation of AUM includes uncalled commitments to, and the fair value of invested capital in, our funds from Carlyle and our personnel, regardless of whether such commitments or invested capital are subject to management or performance fees. Our calculations of Fee-earning AUM or AUM are not based on any definition of Fee-earning AUM or AUM that is set forth in the agreements governing the investment funds that we manage or advise.

We generally use Fee-earning AUM as a metric to measure changes in the assets from which we earn recurring management fees. Total AUM tends to be a better measure of our investment and fundraising performance as it reflects assets at fair value plus available uncalled capital.

Available Capital

Available capital, commonly known as “dry powder,” for our carry funds, fund of funds vehicles, and NGP management fee funds refer to the amount of capital commitments available to be called for investments. Amounts previously called may be added back to available capital following certain distributions. “Expired Available Capital” occurs when a fund has passed the investment and follow-on periods and can no longer invest capital into new or existing deals. Any remaining Available Capital, typically a result of either recycled distributions or specific reserves established for the follow-on period that are not drawn, can only be called for fees and expenses and is therefore removed from the Total AUM calculation.

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The table below provides the period to period rollforward of Available Capital and Fair Value of Capital, and the resulting rollforward of Total AUM.

	Three Months Ended March 31, 2015
	Available Capital			Fair Value of Capital			Total AUM
	(Dollars in millions)
Consolidated Results
Balance, Beginning of Period	$	57,871		$	136,602		$	194,473
Acquisitions	—			—			—
Commitments (1)	6,840			—			6,840
Capital Called, net (2)	(3,363		)	3,200			(163		)
Distributions (3)	342			(8,252		)	(7,910		)
Subscriptions, net of Redemptions (4)	—			(2,147		)	(2,147		)
Changes in CLO collateral balances (5)	—			883			883
Market Appreciation/(Depreciation) (6)	—			7,312			7,312
Foreign Exchange and other (7)	(1,251		)	(5,378		)	(6,629		)
Balance, End of Period	$	60,439		$	132,220		$	192,659

(1) Represents capital raised by our carry funds, NGP management fee funds and fund of funds vehicles, net of expired available capital.

(2) Represents capital called by our carry funds, NGP management fee funds and fund of funds vehicles, net of fund fees and expenses and investments in our business development companies. Equity invested amounts may vary from capital called due to timing differences between acquisition and capital call dates.

(3) Represents distributions from our carry funds. NGP management fee funds and fund of funds vehicles, net of amounts recycled and distributions from our business development companies. Distributions are based on when proceeds are actually distributed to investors, which may differ from when they are realized.

(4) Represents the net result of subscriptions to and redemptions from our hedge funds, mutual fund and fund of hedge funds vehicles.

(5) Represents the change in the aggregate collateral balance and principal cash and principal notes at par of the CLOs/structured products.

(6) Market Appreciation/(Depreciation) represents realized and unrealized gains (losses) on portfolio investments and changes in the net asset value of our hedge funds, mutual fund and fund of hedge funds vehicles.

(7) Represents the impact of foreign exchange rate fluctuations on the translation of our non-U.S. dollar denominated funds and other changes in Total AUM. Activity during the period is translated at the average rate for the period. Ending balances are translated at the spot rate as of the period end.

Please refer to “— Segment Analysis” for a detailed discussion by segment of the activity affecting Total AUM for each of the periods presented.

Consolidated Results of Operations

The following table and discussion sets forth information regarding our unaudited condensed consolidated results of operations for the three months ended March 31, 2015 and 2014. The unaudited condensed consolidated financial statements have been prepared on substantially the same basis for all historical periods presented; however, the consolidated funds are not the same entities in all periods shown due to changes in U.S. GAAP, changes in fund terms and the creation and termination of funds. We formed eight new CLOs throughout 2014 and two new CLOs in the first quarter of 2015 and have consolidated those CLOs beginning on their respective formation dates or closing dates. As further described below, the consolidation of these funds primarily had the impact of increasing interest and other income of Consolidated Funds, interest and other expenses of Consolidated Funds, and net investment gains (losses) of Consolidated Funds in the year that the fund is initially consolidated. The consolidation of these funds had no effect on net income attributable to the Partnership for the periods presented.

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	Three Months Ended March 31,
	2015			2014
	(Dollars in millions, except unit and per unit data)
Revenues
Fund management fees	$	269.5		$	260.3
Performance fees
Realized	326.8			251.4
Unrealized	246.2			369.1
Total performance fees	573.0			620.5
Investment income (loss)
Realized	8.9			—
Unrealized	(2.1		)	6.1
Total investment income	6.8			6.1
Interest and other income	6.0			3.8
Interest and other income of Consolidated Funds	226.3			250.7
Revenue of a consolidated real estate VIE	55.2			6.0
Total revenues	1,136.8			1,147.4
Expenses
Compensation and benefits
Base compensation	180.1			204.6
Equity-based compensation	89.9			74.2
Performance fee related
Realized	143.0			108.7
Unrealized	173.7			221.6
Total compensation and benefits	586.7			609.1
General, administrative and other expenses	116.8			134.3
Interest	14.6			12.2
Interest and other expenses of Consolidated Funds	237.8			264.0
Interest and other expenses of a consolidated real estate VIE	70.0			49.2
Other non-operating expense	1.1			30.2
Total expenses	1,027.0			1,099.0
Other income
Net investment gains of Consolidated Funds	505.5			424.0
Income before provision for income taxes	615.3			472.4
Provision for income taxes	10.5			16.0
Net income	604.8			456.4
Net income attributable to non-controlling interests in consolidated entities	439.1			324.5
Net income attributable to Carlyle Holdings	165.7			131.9
Net income attributable to non-controlling interests in Carlyle Holdings	126.2			107.3
Net income attributable to The Carlyle Group L.P.	$	39.5		$	24.6
Net income attributable to The Carlyle Group L.P. per common unit
Basic	$	0.58		$	0.46
Diluted	$	0.54		$	0.41
Weighted-average common units
Basic	67,684,674			52,501,412
Diluted	72,347,771			59,453,670

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Three Months Ended March 31, 2015 Compared to the Three Months Ended March 31, 2014

Revenues

Total revenues were $1,136.8 million for the three months ended March 31, 2015, a decrease of 1% from total revenues for the three months ended March 31, 2014 of $1,147.4 million. The decrease in revenues was primarily attributable to a decrease in performance fees of $47.5 million and a decrease in interest and other income of consolidated funds of $24.4 million. These decreases were partially offset by increases in revenue of a consolidated real estate VIE of $49.2 million, fund management fees of $9.2 million, and investment income of $0.7 million for the three months ended March 31, 2015 as compared to 2014.

Fund Management Fees. Fund management fees increased $9.2 million, or 4%, to $269.5 million for the three months ended March 31, 2015 as compared to 2014. In addition, fund management fees from consolidated funds decreased $5.2 million for the three months ended March 31, 2015 as compared to 2014. These fees are eliminated upon consolidation of these funds.

The overall increase, inclusive of management fees eliminated from consolidated funds, was primarily due to approximately $52.8 million of incremental management fees from the commencement of the investment period during 2014 and 2015 for certain newly raised funds and catch-up management fees from subsequent closes of funds that are in the fundraising period. Offsetting this increase were decreases in management fees of approximately $28.0 million resulting from the change in the basis for earning management fees from commitments to invested capital for certain funds and from distributions from funds whose management fees are based on invested capital, approximately $13.1 million in decreased management fees from lower assets under management in our hedge funds, and approximately $4.6 million in lower management fees from AlpInvest, which was driven by the decline of the Euro exchange rate in 2015 as compared to 2014.

Fund management fees include transaction and portfolio advisory fees, net of rebate offsets, of $7.6 million and $7.0 million for the three months ended March 31, 2015 and 2014, respectively.

Performance Fees. Performance fees for the three months ended March 31, 2015 were $573.0 million compared to $620.5 million for the three months ended March 31, 2014. In addition, performance fees from consolidated funds decreased $16.0 million for the three months ended March 31, 2015 as compared to 2014. These fees eliminate upon consolidation. The overall decrease in performance fees recorded in 2015 as compared to 2014 were due principally to the decline in hedge fund incentive fees in 2015. The hedge funds recognized incentive fee accruals of approximately $68.6 million for the three months ended March 31, 2014. The asset weighted performance of our reported hedge funds was 2% in the three months ended March 31, 2015; however, the hedge funds largely remain below their high-water mark, and, therefore, we recognized an insignificant amount of incentive fees. The overall portfolio appreciation in Carlyle's carry funds was 6% for the three months ended March 31, 2015 and 2014, respectively. Through the first three months of 2015, the U.S. economy appears to have slowed relative to 2014. This deceleration appears to be due to the increase in the foreign exchange value of the U.S. dollar and the decline in energy-related capital expenditures. However, the S&P 500 index rose 2.5% since the end of 2014 to new record highs during Q1 2015. This increase has pushed valuations to new highs. Globally, valuations continue to remain high and interest rates continue to decline. Amongst this market volatility, our public carry fund portfolio appreciated 15% in the three months ended March 31, 2015, while our private carry fund portfolio appreciated 2% for an aggregate of 6% for the three months ended March 31, 2015.

Approximately $513.3 million and $453.2 million of performance fees for the three months ended March 31, 2015 and 2014, respectively, were generated by our Corporate Private Equity segment. Performance fees for the three months ended March 31, 2015 and 2014 were $18.7 million and $66.1 million for the Global Market Strategies segment, $(8.5) million and $16.8 million for the Real Assets segment, and $49.5 million and $84.4 million for the Investment Solutions segment, respectively. Further, approximately $333.7 million of our performance fees for the three months ended March 31, 2015 were related to CEP III, CP V, CP IV, and Energy III, while $413.1 million of our performance fees for the three months ended March 31, 2014 were related to CP V and CEP III.

Investment Income. Investment income of $6.8 million for the three months ended March 31, 2015 increased $0.7 million over investment income of $6.1 million for the three months ended March 31, 2014.

In addition, investment income from Consolidated Funds decreased $34.8 million for the three months ended March 31, 2015 as compared to 2014, which was due primarily to $34 million in investment losses in the first quarter of 2015 associated with an adverse court judgment in a French tax court proceeding related to a transaction that our first European real estate fund ("CEREP I") exited between 2007 and 2009. See Note 11 to the unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q for additional information. This income is eliminated upon consolidation.

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Interest and Other Income. Interest and other income increased $2.2 million to $6.0 million for the three months ended March 31, 2015, as compared to $3.8 million for 2014.

Interest and Other Income of Consolidated Funds. Interest and other income of Consolidated Funds was $226.3 million for the three months ended March 31, 2015, a decrease of $24.4 million from $250.7 million for the three months ended March 31, 2014. Our CLOs generate interest income primarily from investments in bonds and loans inclusive of amortization of discounts and generate other income from consent and amendment fees. Also included in this balance is interest income and dividend income recognized by the consolidated fund of funds vehicles and consolidated hedge funds. The decrease from 2014 to 2015 is due primarily to lower interest and dividend income of $15.4 million from the consolidated hedge funds and lower interest and dividend income of $12.0 million from the consolidated fund of funds vehicles. Substantially all interest and other income of the CLOs and other consolidated funds together with interest expense of our CLOs and net investment gains (losses) of Consolidated Funds is attributable to the related funds’ limited partners or CLO investors and therefore is allocated to non-controlling interests. Accordingly, such amounts have no material impact on net income attributable to the Partnership.

Revenue of a Consolidated Real Estate VIE. Revenue of a consolidated real estate VIE was $55.2 million for the three months ended March 31, 2015, an increase of $49.2 million as compared to $6.0 million in 2014. The increase was due primarily to Urbplan completing more land development projects in 2015 as compared to 2014. Urbplan recognizes revenue for land development services under the completed contract method.

Expenses

Expenses were $1,027.0 million for the three months ended March 31, 2015, a decrease of $72.0 million from $1,099.0 million for the three months ended March 31, 2014. The decrease primarily is due to decreases in other non-operating expenses, interest and other expenses of consolidated funds, total compensation and benefits, and general, administrative and other expenses, which decreased $29.1 million, $26.2 million, $22.4 million, and $17.5 million, respectively. These decreases were partially offset by increases in interest and other expenses of a consolidated real estate VIE, which increased $20.8 million.

Total compensation and benefits for the three months ended March 31, 2015decreased $22.4 million, or 4%, from $609.1 million for the three months ended March 31, 2014 to $586.7 million for the three months ended March 31, 2015. The decrease in total compensation and benefits primarily reflects a decrease in base compensation expense of $24.5 million and a decrease in performance fee related compensation expense of $13.6 million. These decreases were partially offset by an increase in equity-based compensation expense of $15.7 million.

Compensation and Benefits. Base compensation and benefits decreased $24.5 million, or 12%, for the three months ended March 31, 2015 as compared to 2014. The decrease primarily relates to lower expense associated with employment-related contingent consideration arrangements primarily from hedge fund acquisitions of approximately $21.2 million as a result of updated assumptions used to determine the expected payment of the contingent consideration.

Equity-based compensation increased $15.7 million for the three months ended March 31, 2015 as compared to 2014. The increase in equity-based compensation is due primarily to the ongoing granting of deferred restricted common units to new and existing employees during 2014 and 2015. Also contributing to the increase in equity-based compensation was a decrease to the estimated forfeiture rates during the first quarter of 2015, which resulted in a cumulative catch-up of expense associated with this change of estimate of $7.5 million for 2015.

Performance fee related compensation expense decreased $13.6 million for the three months ended March 31, 2015 as compared to 2014. Performance fee related compensation as a percentage of performance fees was 55% and 53% for the three months ended March 31, 2015 and 2014, respectively.

General, Administrative and Other Expenses. General, administrative and other expenses decreased $17.5 million for the three months ended March 31, 2015 as compared to 2014. This decrease was driven primarily by lower intangible asset impairment losses in 2015 as compared to 2014; impairment losses were $11.8 million and $24.6 million for the three months ended March 31, 2015 and 2014, respectively. Also contributing to the decrease was $8.8 million of lower external fundraising costs in 2015 as compared to 2014.

Interest. Interest expense for the three months ended March 31, 2015 was $14.6 million, an increase of $2.4 million from 2014. The increase was due primarily to the interest on $200 million of 5.625% senior notes due 2043 issued in March 2014.

Interest and Other Expenses of Consolidated Funds. Interest and other expenses of Consolidated Funds decreased $26.2 million for the three months ended March 31, 2015 as compared to 2014. This decrease is primarily due to lower interest

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expense on the consolidated CLOs and consolidated hedge funds. The CLOs incur interest expense on their loans payable and incur other expenses consisting of trustee fees, rating agency fees and professional fees. Substantially all interest and other income of the CLOs and other consolidated funds together with interest expense of our CLOs and net investment gains (losses) of Consolidated Funds is attributable to the related funds’ limited partners or CLO investors and therefore is allocated to non-controlling interests. Accordingly, such amounts have no material impact on net income attributable to the Partnership.

Interest and Other Expenses of a Consolidated Real Estate VIE. Interest and other expenses of a consolidated real estate VIE were $70.0 million and $49.2 million for the three months ended March 31, 2015 and 2014, respectively, representing an increase of $20.8 million. The increase was due primarily to Urbplan completing more land development projects in 2015 as compared to 2014, resulting in an increase in the costs of services rendered of $27.3 million from 2014 to 2015.

Other Non-operating Expenses. Other non-operating expense of $1.1 million for the three months ended March 31, 2015 compares to $30.2 million for the three months ended March 31, 2014. For the periods presented, this caption represents the change in the fair value of contingent consideration associated with the Partnership’s acquisitions. The estimated fair value of the contingent consideration increased at a higher rate in 2014 than in 2015, based on management's assumptions in the probability-weighted discounted cash flow models used to estimate the fair value at such time. The contingent consideration arrangements are primarily associated with the Partnership's hedge fund acquisitions. The estimated fair value of the contingent consideration increased significantly in the first quarter of 2014 but subsequently declined during the remainder of 2014 in a manner consistent with the performance of the hedge funds in 2014.

Generally, the contingent consideration associated with the Partnership’s acquisitions is payable at future dates over a period of years. Because the estimated fair value of these obligations relies upon estimates of cash flows in those future periods, there will be inherent volatility in the fair value of the Partnership’s liability (and as a result, the periodic expense recognized) until such time as the future cash flow projections become more definitive. However, if the financial performance of the acquisitions is consistent with, or exceeds, the Partnership’s original financial forecast at acquisition, the fair value of the contingent consideration liabilities will increase over time (with a corresponding expense) as the actual performance measurement date for the payment approaches. See Note 9 to the unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q for additional information.

Net Investment Gains of Consolidated Funds

For the three months ended March 31, 2015, net investment gains of Consolidated Funds were $505.5 million as compared to $424.0 million for the three months ended March 31, 2014. This balance is predominantly driven by our consolidated AlpInvest fund of funds vehicles, CLOs, and hedge funds. For the consolidated CLOs, the amount reflects the net gain or loss on the fair value adjustment of both assets and liabilities. The components of net investment gains of consolidated funds for the respective periods are:

	Three Months Ended March 31,
	2015			2014
	(Dollars in millions)
Realized gains	$	224.6		$	732.3
Net change in unrealized losses	335.9			(243.4		)
Total gains (losses)	560.5			488.9
Losses from liabilities of CLOs	(55.5		)	(65.1		)
Gains on other assets of CLOs	0.5			0.2
Total	$	505.5		$	424.0

The realized and unrealized investment gains/losses primarily include the appreciation/depreciation of the equity investments within the consolidated AlpInvest fund of funds vehicles, the appreciation/depreciation of CLO investments in loans and bonds, as well as the appreciation/depreciation of investments made by our consolidated hedge funds and other consolidated funds. The gains/losses on the liabilities of the CLOs reflect the fair value adjustment on the debt of the CLOs. The net investment gains for the three months ended March 31, 2015 and 2014 were due primarily to net investment gains attributable to the consolidated AlpInvest fund of funds vehicles of $478.5 million and $378.5 million, respectively, net investment gains attributable to the consolidated hedge funds of $102.4 million and $105.9 million, respectively, net investment losses attributable to other consolidated funds of $32.6 million and $4.0 million, and the net depreciation of CLOs of $42.8 million and $56.4 million, respectively.

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Net Income Attributable to Non-controlling Interests in Consolidated Entities

Net income attributable to non-controlling interests in consolidated entities was $439.1 million for the three months ended March 31, 2015 as compared to $324.5 million for the three months ended March 31, 2014. These amounts are primarily attributable to the net earnings or losses of the Consolidated Funds for each period, which are substantially all allocated to the related funds’ limited partners or CLO investors. This balance also includes the allocation of Urbplan's net losses that are attributable to non-controlling interests.

For the three months ended March 31, 2015, the net income of our Consolidated Funds was approximately $441.3 million. This income was substantially due to the consolidated AlpInvest fund of funds vehicles and the consolidated hedge funds, partially offset by net losses on the consolidated CLOs and other consolidated funds. The net income from the consolidated AlpInvest fund of funds vehicles and consolidated hedge funds was approximately $448.7 million and $75.5 million, respectively, for the three months ended March 31, 2015. The net income was partially offset by net losses from the consolidated CLOs and other consolidated funds of $48.5 million and $34.4 million, respectively, for the three months ended March 31, 2015.

For the three months ended March 31, 2014, the net income of our Consolidated Funds was approximately $337.8 million. This income was substantially due to the consolidated AlpInvest fund of funds vehicles, the consolidated hedge funds, and the consolidated CLOs. The net income from the consolidated AlpInvest fund of funds vehicles and the consolidated hedge funds was approximately $356.3 million and $66.6 million, respectively, for the three months ended March 31, 2014. The net income was partially offset by net losses from the consolidated CLOs and other consolidated funds of $81.4 million and $3.7 million, respectively, for the three months ended March 31, 2014.

Net Income Attributable to The Carlyle Group L.P.

The net income attributable to the Partnership was $39.5 million for the three months ended March 31, 2015 as compared to $24.6 million for the three months ended March 31, 2014. The Partnership is allocated a portion of the net income (loss) attributable to Carlyle Holdings based on the Partnership’s ownership in Carlyle Holdings (which was approximately 21% and 20% as of March 31, 2015 and 2014, respectively). For the three months ended March 31, 2015 and 2014, the net income attributable to Carlyle Holdings was $165.7 million and $131.9 million, respectively. Additionally, the Partnership is allocated 100% of the net income or loss attributable to the Partnership’s wholly-owned taxable subsidiaries, which was $5.6 million and $3.8 million for the three months ended March 31, 2015 and 2014, respectively.

Non-GAAP Financial Measures

The following table sets forth information in the format used by management when making resource deployment decisions and in assessing performance of our segments. These non-GAAP financial measures are presented for the three months ended March 31, 2015 and 2014. The table below shows our total segment Economic Net Income which is the sum of Fee Related Earnings, Net Performance Fees, Investment Income and Equity-based compensation expense (excluding equity-based compensation grants issued in May 2012 upon the completion of the initial public offering or grants issued in acquisitions or strategic investments). This analysis excludes the effects of consolidated funds, acquisition-related items including amortization of acquired intangible assets and contingent consideration taking the form of earn-outs, charges associated with equity-based compensation grants issued in May 2012 upon completion of the initial public offering or grants issued in acquisitions or strategic investments, corporate actions and infrequently occurring or unusual events.

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	Three Months Ended March 31,
	2015			2014
	(Dollars in millions)
Segment Revenues
Fund level fee revenues
Fund management fees	$	296.6		$	287.8
Portfolio advisory fees, net	5.8			3.8
Transaction fees, net	1.8			3.2
Total fund level fee revenues	304.2			294.8
Performance fees
Realized	321.7			249.4
Unrealized	280.5			355.7
Total performance fees	602.2			605.1
Investment income (loss)
Realized	(82.0		)	5.3
Unrealized	54.0			(13.2		)
Total investment income (loss)	(28.0		)	(7.9		)
Interest and other income	6.5			4.5
Total revenues	884.9			896.5
Segment Expenses
Compensation and benefits
Direct base compensation	121.9			126.7
Indirect base compensation	51.0			46.1
Equity-based compensation	32.3			14.0
Performance fee related
Realized	143.3			109.3
Unrealized	177.1			199.4
Total compensation and benefits	525.6			495.5
General, administrative, and other indirect expenses	66.5			71.7
Depreciation and amortization expense	5.5			5.4
Interest expense	14.6			12.2
Total expenses	612.2			584.8
Economic Net Income	$	272.7		$	311.7
(-) Net Performance Fees	281.8			296.4
(-) Investment Income (Loss)	(28.0		)	(7.9		)
(+) Equity-based Compensation	32.3			14.0
(=) Fee Related Earnings	$	51.2		$	37.2
(+) Realized Net Performance Fees	178.4			140.1
(+) Realized Investment Income (Loss)	(82.0		)	5.3
(=) Distributable Earnings	$	147.6		$	182.6

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Income before provision for income taxes is the GAAP financial measure most comparable to economic net income, fee related earnings, and distributable earnings. The following table is a reconciliation of income before provision for income taxes to economic net income, to fee related earnings, and to distributable earnings.

	Three Months Ended March 31,
	2015			2014
	(Dollars in millions)
Income before provision for income taxes	$	615.3		$	472.4
Adjustments:
Equity-based compensation issued in conjunction with the initial public offering, acquisitions and strategic investments	59.0			62.4
Acquisition related charges and amortization of intangibles	40.6			80.1
Other non-operating expense	1.1			30.2
Tax expense associated with performance fee compensation	(5.2		)	(10.2		)
Net income attributable to non-controlling interests in Consolidated entities	(439.1		)	(324.5		)
Other adjustments	1.0			1.3
Economic Net Income	$	272.7		$	311.7
Net performance fees(1)	281.8			296.4
Investment loss(1)	(28.0		)	(7.9		)
Equity-based compensation	32.3			14.0
Fee Related Earnings	$	51.2		$	37.2
Realized performance fees, net of related compensation	178.4			140.1
Realized investment income (loss)(1)	(82.0		)	5.3
Distributable Earnings	$	147.6		$	182.6

(1) – See reconciliation to most directly comparable U.S. GAAP measure below:

	Three Months Ended March 31, 2015
	Carlyle Consolidated			Adjustments (2)			Total Reportable Segments
	(Dollars in millions)
Performance fees
Realized	$	326.8		$	(5.1	)	$	321.7
Unrealized	246.2			34.3			280.5
Total performance fees	573.0			29.2			602.2
Performance fee related compensation expense
Realized	143.0			0.3			143.3
Unrealized	173.7			3.4			177.1
Total performance fee related compensation expense	316.7			3.7			320.4
Net performance fees
Realized	183.8			(5.4		)	178.4
Unrealized	72.5			30.9			103.4
Total net performance fees	$	256.3		$	25.5		$	281.8
Investment income (loss)
Realized	$	8.9		$	(90.9	)	$	(82.0	)
Unrealized	(2.1		)	56.1			54.0
Investment income (loss)	$	6.8		$	(34.8	)	$	(28.0	)

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	Three Months Ended March 31, 2014
	Carlyle Consolidated		Adjustments (2)			Total Reportable Segments
	(Dollars in millions)
Performance fees
Realized	$	251.4	$	(2.0	)	$	249.4
Unrealized	369.1		(13.4		)	355.7
Total performance fees	620.5		(15.4		)	605.1
Performance fee related compensation expense
Realized	108.7		0.6			109.3
Unrealized	221.6		(22.2		)	199.4
Total performance fee related compensation expense	330.3		(21.6		)	308.7
Net performance fees
Realized	142.7		(2.6		)	140.1
Unrealized	147.5		8.8			156.3
Total net performance fees	$	290.2	$	6.2		$	296.4
Investment income (loss)
Realized	$	—	$	5.3		$	5.3
Unrealized	6.1		(19.3		)	(13.2		)
Total investment income (loss)	$	6.1	$	(14.0	)	$	(7.9	)

(2) Adjustments to performance fees and investment income (loss) relate to (i) amounts earned from the Consolidated Funds, which were eliminated in the U.S. GAAP consolidation but were included in the Non-GAAP results, (ii) amounts attributable to non-controlling interests in consolidated entities, which were excluded from the Non-GAAP results, and (iii) the reclassification of NGP X performance fees, which are included in investment income in the U.S. GAAP financial statements. Adjustments to investment income (loss) also include the reclassification of earnings for the investment in NGP Management to the appropriate operating captions for the Non-GAAP results, the exclusion of charges associated with the investment in NGP Management that are excluded from the Non-GAAP results and adjustments to reflect the Partnership’s share of Urbplan net losses as investment losses for the Non-GAAP results. Adjustments to performance fee related compensation expense relate to the inclusion of certain tax expenses associated with performance fee related compensation. Adjustments are also included in these financial statement captions to reflect Carlyle’s 55% economic interest in each of Claren Road, ESG and Vermillion.

Economic Net Income and Distributable Earnings for our reportable segments are as follows:

	Three Months Ended March 31,
	2015			2014
	(Dollars in millions)
Economic Net Income (Loss)
Corporate Private Equity	$	289.0		$	258.4
Global Market Strategies	9.6			56.2
Real Assets	(33.4		)	(16.5		)
Investment Solutions	7.5			13.6
Economic Net Income (Loss)	$	272.7		$	311.7
Distributable Earnings
Corporate Private Equity	$	193.9		$	147.7
Global Market Strategies	8.5			22.3
Real Assets	(61.7		)	2.0
Investment Solutions	6.9			10.6
Distributable Earnings	$	147.6		$	182.6

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Segment Analysis

Discussed below is our ENI for our segments for the periods presented. Our segment information is reflected in the manner used by our senior management to make operating decisions, assess performance and allocate resources.

For segment reporting purposes, revenues and expenses are presented on a basis that deconsolidates our Consolidated Funds. As a result, segment revenues from management fees, performance fees and investment income are different than those presented on a consolidated U.S. GAAP basis because fund management fees recognized in certain segments are received from Consolidated Funds and are eliminated in consolidation when presented on a consolidated U.S. GAAP basis. Furthermore, segment expenses are different than related amounts presented on a consolidated U.S. GAAP basis due to the exclusion of fund expenses that are paid by the Consolidated Funds. Segment revenue and expenses are also different than those presented on a consolidated U.S. GAAP basis because we present our segment revenues and expenses related to Claren Road, ESG, and Vermillion based on our 55% economic interest in those entities. Also, ENI excludes expenses associated with equity-based compensation that was issued in our initial public offering or issued in acquisitions and strategic investments.

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Corporate Private Equity

The following table presents our results of operations for our Corporate Private Equity segment:

	Three Months Ended March 31,
	2015		2014
	(Dollars in millions)
Segment Revenues
Fund level fee revenues
Fund management fees	$	134.3	$	129.8
Portfolio advisory fees, net	5.2		3.5
Transaction fees, net	1.5		3.2
Total fund level fee revenues	141.0		136.5
Performance fees
Realized	306.0		234.7
Unrealized	200.7		212.9
Total performance fees	506.7		447.6
Investment income
Realized	2.7		1.9
Unrealized	7.4		5.4
Total investment income	10.1		7.3
Interest and other income	3.2		2.2
Total revenues	661.0		593.6
Segment Expenses
Compensation and benefits
Direct base compensation	53.7		59.5
Indirect base compensation	26.3		22.0
Equity-based compensation	17.3		7.1
Performance fee related
Realized	137.0		101.3
Unrealized	95.7		100.5
Total compensation and benefits	330.0		290.4
General, administrative, and other indirect expenses	31.7		35.4
Depreciation and amortization expense	2.7		2.7
Interest expense	7.6		6.7
Total expenses	372.0		335.2
Economic Net Income	$	289.0	$	258.4
(-) Net Performance Fees	274.0		245.8
(-) Investment Income	10.1		7.3
(+) Equity-based Compensation	17.3		7.1
(=) Fee Related Earnings	$	22.2	$	12.4
(+) Realized Net Performance Fees	169.0		133.4
(+) Realized Investment Income	2.7		1.9
(=) Distributable Earnings	$	193.9	$	147.7

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Three Months Ended March 31, 2015 Compared to the Three Months Ended March 31, 2014

Total fee revenues were $141.0 million for the three months ended March 31, 2015, representing an increase of $4.5 million, or 3%, from the three months ended March 31, 2014. This increase reflects a $4.5 millionincrease in fund management fees and a $1.7 millionincrease in portfolio advisory fees. These increases were partially offset by a decrease in transaction fees of $1.7 million. The increase in fund management fees is partially due to increased management fees from our fourth Europe buyout fund ("CEP IV"), our third Japan buyout fund ("CJP III"), and our third Europe technology fund ("CETP III"). Fund management fees for these funds include $11.9 million of catch-up management fees earned in the first quarter of 2015, primarily from subsequent closings. This increase was offset by lower management fees in 2015 as compared to 2014 in other U.S. and Europe buyout funds where management fees are based on invested capital due to sales of investments in those funds. Management fees from our European funds were also impacted by the decline in the Euro exchange rate in 2015 as compared to 2014. The weighted-average management fee rate on funds in the investment period slightly decreased to 1.42% at March 31, 2015 from 1.44% at March 31, 2014. The total weighted-average management fee rate increased from 1.17% at March 31, 2014 to 1.23% at March 31, 2015. The increase in the total weighted-average management fee rate reflects new funds being raised with higher management fee rates.

Interest and other income was $3.2 million for the three months ended March 31, 2015, an increase from $2.2 million for the three months ended March 31, 2014.

Total compensation and benefits was $330.0 million and $290.4 million for the three months ended March 31, 2015 and 2014, respectively. Performance fee related compensation expense was $232.7 million and $201.8 million, or 46% and 45% of performance fees, for the three months ended March 31, 2015 and 2014, respectively.

Direct and indirect base compensation expense decreased$1.5 million for the three months ended March 31, 2015, or 2% more than the three months ended March 31, 2014. The decrease is primarily due to lower headcount, partially offset by an increase in compensation costs related to internal fundraising activities of approximately $3.7 million.

Equity-based compensation was $17.3 million for the three months ended March 31, 2015, an increase from $7.1 million for the three months ended March 31, 2014. The increase is due primarily to the ongoing granting of deferred restricted common units to new and existing employees during 2014 and 2015 and a decrease in the estimated forfeiture rates during the three months ended March 31, 2015.

General, administrative and other indirect expenses decreased$3.7 million for the three months ended March 31, 2015 as compared to 2014. The decrease is principally due to a decrease in external costs associated with fundraising activities in 2015 as compared to 2014 of $7.9 million, primarily related to our fourth Asia buyout fund ("CAP IV"). This decrease was partially offset by increases in professional fees and information technology expenses.

Depreciation and amortization expense was $2.7 million for the three months ended March 31, 2015 and 2014.

Interest expense increased$0.9 million, or 13%, for the three months ended March 31, 2015 as compared to 2014. The increase was due primarily to the allocated interest on $200 million of 5.625% senior notes due 2043 issued in March 2014.

Economic Net Income. ENI was $289.0 million for the three months ended March 31, 2015, reflecting a 12%increase as compared to ENI of $258.4 million for the three months ended March 31, 2014. The increase in ENI for the three months ended March 31, 2015 was due to an increase in net performance fees of $28.2 million, an increase in fee related earnings of $9.8 million, and an increase in investment income of $2.8 million. These increases were partially offset by an increase in equity-based compensation of $10.2 million.

Fee Related Earnings. Fee related earnings were $22.2 million for the three months ended March 31, 2015, as compared to $12.4 million for the three months ended March 31, 2014, representing an increase of $9.8 million. The increase in fee related earnings is primarily attributable to an increase in fee revenues of $4.5 million, a decrease in general, administrative and other indirect expenses of $3.7 million, and a decrease in direct and indirect base compensation of $1.5 million.

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Performance Fees. Performance fees increased$59.1 million for the three months ended March 31, 2015 as compared to 2014. Performance fees of $506.7 million and $447.6 million are inclusive of performance fees reversed of approximately $0.8 million and $55.0 million during the three months ended March 31, 2015 and 2014, respectively. Performance fees and appreciation in remaining value of assets for this segment by type of fund are as follows:

	Performance Fees					Carry Fund Portfolio Appreciation
	Three Months Ended March 31,					Three Months Ended March 31,
	2015		2014			2015	2014
	(Dollars in millions)
Buyout funds	$	493.8	$	451.2		9%	8%
Growth Capital funds	12.9		(3.6		)	3%	—%
Total	$	506.7	$	447.6		8%	8%

The $506.7 million in performance fees for the three months ended March 31, 2015 was driven primarily by performance fees for CEP III, CP V, and CP IV, of $159.3 million, $157.8 million, and $76.8 million, respectively. Comparatively, the $447.6 million in performance fees for the three months ended March 31, 2014 was driven primarily by performance fees for CP V, CEP III, and CP IV of $246.6 million, $162.6 million, and $51.3 million, respectively.

During the three months ended March 31, 2015, net performance fees were $274.0 million or 54% of performance fees and $28.2 million more than the net performance fees in the three months ended March 31, 2014.

Investment Income. Investment income for the three months ended March 31, 2015 was $10.1 million compared to $7.3 million for the three months ended March 31, 2014. The increase in investment income from 2014 to 2015 relates primarily to continued appreciation on investments in certain Europe buyout funds.

Distributable Earnings. Distributable earnings increased$46.2 million for the three months ended March 31, 2015 to $193.9 million from $147.7 million for the same period in 2014. This increase primarily reflects an increase in realized net performance fees of $35.6 million, an increase in fee related earnings of $9.8 million, and an increase in realized investment income of 0.8 million.

Fee-earning AUM as of and for the Three Months Ended March 31, 2015 and 2014

Fee-earning AUM is presented below for each period together with the components of change during each respective period.

The table below breaks out Fee-earning AUM by its respective components at each period.

	As of March 31,
	2015			2014
Corporate Private Equity	(Dollars in millions)
Components of Fee-earning AUM (1)
Fee-earning AUM based on capital commitments	$	22,648		$	19,568
Fee-earning AUM based on invested capital	15,426			22,453
Fee-earning AUM based on lower of cost or fair value	1,289			837
Total Fee-earning AUM	$	39,363		$	42,858
Weighted Average Management Fee Rates (2)
All Funds	1.23		%	1.17		%
Funds in Investment Period	1.42		%	1.44		%

(1) For additional information concerning the components of Fee-earning AUM, see “—Fee-earning Assets under Management.”

(2) Represents the aggregate effective management fee rate of each fund in the segment, weighted by each fund’s Fee-earning AUM, as of the end of each period presented.

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The table below provides the period to period rollforward of Fee-earning AUM.

	Three Months Ended March 31,
	2015			2014
Corporate Private Equity	(Dollars in millions)
Fee-earning AUM Rollforward
Balance, Beginning of Period	$	40,249		$	43,033
Inflows, including Fee-paying Commitments (1)	704			697
Outflows, including Distributions (2)	(963		)	(886		)
Market Appreciation/(Depreciation) (3)	(5		)	—
Foreign Exchange and other (4)	(622		)	14
Balance, End of Period	$	39,363		$	42,858

(1) Inflows represent limited partner capital raised and capital invested by carry funds outside the original investment period.

(2) Outflows represent distributions from funds outside the investment period and changes in fee basis for our carry funds where the original investment period has expired.

(3) Market Appreciation/(Depreciation) represents realized and unrealized gains (losses) on portfolio investments in our carry funds based on the lower of cost or fair value.

(4) Represents the impact of foreign exchange rate fluctuations on the translation of our non-U.S. dollar denominated funds. Activity during the period is translated at the average rate for the period. Ending balances are translated at the spot rate as of period end.

Fee-earning AUM was $39.4 billion at March 31, 2015, a decrease of $0.9 billion, or approximately 2%, compared to $40.2 billion at December 31, 2014. This decrease was due to outflows of $1.0 billion from distributions in several funds outside of the investment period and a decrease of $0.6 billion from foreign exchange, primarily on our Euro-based funds. Offsetting these outflows were inflows of $0.7 billion, primarily a result of limited partner commitments raised by CEP IV, CJP III, and CETP III. External commitments raised for our second U.S. mid-market buyout fund ("CEOF II") will not be reflected until its predecessor fund has been fully invested, nor will commitments to our new global buyout fund ("CGP"), which is based on invested equity. Investment and distribution activity by funds still in the investment period does not impact Fee-earning AUM as these funds are based on commitments.

Fee-earning AUM was $39.4 billion at March 31, 2015, a decrease of $3.5 billion, or approximately 8%, compared to $42.9 billion at March 31, 2014. This reflects $4.8 billion in new limited partner commitments raised by CEP IV, CAP IV, CETP III and CJP III, in addition to investments in funds outside of their original investment period.This is offset by $6.6 billion of distributions in various funds outside of their original investment period, a reduction in fee basis from commitment to invested capital due to the expiration of the original investment periods for our fourth Asia growth fund ("CAGP IV") and CEP III, in addition to the elimination of fees for our second Europe buyout fund ("CEP II"), and foreign exchange.

Fee-earning AUM was $42.9 billion at March 31, 2014, a decrease of $0.1 billion, or less than 1%, compared to $43.0 billion at December 31, 2013. Outflows of $0.9 billion were principally a result of distributions from several buyout funds that were outside of their investment period. This was offset by inflows of $0.7 billion, primarily related to limited partner commitments raised by CJP III, CAP IV, CEP IV, and other global buyout funds, in addition to equity invested by various funds outside their investment period.

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Total AUM as of and for the Three Months Ended March 31, 2015

The table below provides the period to period rollforwards of Available Capital and Fair Value of Capital, and the resulting rollforward of Total AUM.

	Three Months Ended March 31, 2015
	Available Capital			Fair Value of Capital			Total AUM
	(Dollars in millions)
Corporate Private Equity
Balance, Beginning of Period	$	24,439		$	40,229		$	64,668
Commitments (1)	1,685			—			1,685
Capital Called, net (2)	(1,024		)	907			(117		)
Distributions (3)	194			(4,158		)	(3,964		)
Market Appreciation/(Depreciation) (4)	—			3,149			3,149
Foreign Exchange and other (5)	(455		)	(918		)	(1,373		)
Balance, End of Period	$	24,839		$	39,209		$	64,048

(1) Represents capital raised by our carry funds, net of expired available capital.

(2) Represents capital called by our carry funds, net of fund fees and expenses. Equity invested amounts may vary from capital called due to timing differences between acquisition and capital call dates.

(3) Represents distributions from our carry funds, net of amounts recycled. Distributions are based on when proceeds are actually distributed to investors, which may differ from when they are realized.

(4) Market Appreciation/(Depreciation) represents realized and unrealized gains (losses) on portfolio investments.

(5) Represents the impact of foreign exchange rate fluctuations on the translation of our non-U.S. dollar denominated funds. Activity during the period is translated at the average rate for the period. Ending balances are translated at the spot rate as of the period end.

Total AUM was $64.0 billion at March 31, 2015, a decrease of $0.6 billion, or approximately1%, compared to $64.7 billion as of December 31, 2014. This was primarily driven by net distributions of $4.0 billion and a decrease of $1.4 billion due to foreign exchange. Offsetting the decrease was $1.7 billion in new commitments for several funds, including the first close of CEOF II, additional closes in CEP IV, CJP III, and CETP III, and market appreciation of $3.1 billion. Our portfolio experienced a 8% increase in value over the period, due to a 9% increase across our buyout funds, and an 3% increase across our growth capital funds. The 9% increase in our buyout funds was primarily driven by appreciation in CP V, CEP III and CP IV.

Fund Performance Metrics

Fund performance information for our investment funds that generally have at least $1.0 billion in capital commitments, cumulative equity invested or total value as of March 31, 2015, which we refer to as our “significant funds” is included throughout this discussion and analysis to facilitate an understanding of our results of operations for the periods presented. The fund return information reflected in this discussion and analysis is not indicative of the performance of The Carlyle Group L.P. and is also not necessarily indicative of the future performance of any particular fund. An investment in The Carlyle Group L.P. is not an investment in any of our funds. There can be no assurance that any of our funds or our other existing and future funds will achieve similar returns.

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The following tables reflect the performance of our significant funds in our Corporate Private Equity business. Please see “— Our Family of Funds” for a legend of the fund acronyms listed below.

				TOTAL INVESTMENTS									REALIZED/PARTIALLY REALIZED INVESTMENTS(5)
				As of March 31, 2015									Inception to March 31, 2015
	Fund Inception Date(1)	Committed Capital		Cumulative Invested Capital(2)		Total Fair Value(3)		MOIC(4)	Gross IRR(7)		Net IRR(8)		Cumulative Invested Capital(2)		Total Fair Value(3)		MOIC(4)	Gross IRR(7)
Corporate Private Equity	(Reported in Local Currency, in Millions)												(Reported in Local Currency, in Millions)
Fully Invested Funds(6)
CP II	10/1994	$	1,331.1	$	1,362.4	$	4,072.2	3.0x	34	%	25	%	$	1,362.4	$	4,072.2	3.0x	34	%
CP III	2/2000	$	3,912.7	$	4,031.6	$	10,146.9	2.5x	27	%	21	%	$	4,031.6	$	10,146.9	2.5x	27	%
CP IV	12/2004	$	7,850.0	$	7,612.6	$	18,186.1	2.4x	17	%	13	%	$	6,827.6	$	17,293.5	2.5x	18	%
CP V	5/2007	$	13,719.7	$	12,815.5	$	25,102.0	2.0x	20	%	15	%	$	5,984.1	$	13,901.0	2.3x	24	%
CEP I	12/1997	€	1,003.6	€	981.6	€	2,126.5	2.2x	18	%	11	%	€	981.6	€	2,126.5	2.2x	18	%
CEP II	9/2003	€	1,805.4	€	2,048.8	€	4,069.6	2.0x	37	%	21	%	€	1,489.4	€	3,584.6	2.4x	55	%
CEP III	12/2006	€	5,294.9	€	4,988.3	€	10,426.7	2.1x	20	%	15	%	€	2,809.8	€	6,515.2	2.3x	20	%
CAP I	12/1998	$	750.0	$	627.7	$	2,521.8	4.0x	25	%	18	%	$	627.7	$	2,521.8	4.0x	25	%
CAP II	2/2006	$	1,810.0	$	1,633.6	$	2,778.3	1.7x	11	%	8	%	$	720.0	$	2,115.0	2.9x	24	%
CAP III	5/2008	$	2,551.6	$	2,503.2	$	4,035.7	1.6x	18	%	11	%	$	984.4	$	1,980.0	2.0x	22	%
CJP I	10/2001	¥	50,000.0	¥	47,291.4	¥	140,679.6	3.0x	61	%	37	%	¥	39,756.6	¥	131,454.6	3.3x	65	%
CJP II	7/2006	¥	165,600.0	¥	141,866.7	¥	182,902.0	1.3x	6	%	2	%	¥	64,306.1	¥	90,362.1	1.4x	7	%
CGFSP I	9/2008	$	1,100.2	$	1,052.5	$	1,883.7	1.8x	19	%	13	%	$	312.8	$	746.4	2.4x	28	%
CETP II	2/2007	€	521.6	€	431.5	€	961.4	2.2x	26	%	16	%	€	149.8	€	550.9	3.7x	34	%
CAGP IV	6/2008	$	1,041.4	$	807.3	$	1,173.5	1.5x	14	%	8	%	$	155.0	$	379.3	2.4x	33	%
All Other Funds (9)	Various			$	3,644.2	$	5,659.6	1.6x	17	%	7	%	$	2,729.5	$	4,614.7	1.7x	21	%
Coinvestments and Other (10)	Various			$	8,061.9	$	20,449.5	2.5x	36	%	33	%	$	5,528.1	$	16,626.5	3.0x	36	%
Total Fully Invested Funds				$	54,795.1	$	117,572.3	2.1x	27	%	19	%	$	35,899.6	$	89,954.8	2.5x	29	%
Funds in the Investment Period (6)
CP VI (12)	5/2012	$	13,000.0	$	3,813.7	$	3,965.4	1.0x	NM		NM
CEP IV (12)	8/2013	€	2,018.1	€	319.2	€	299.6	0.9x	NM		NM
CAP IV (12)	11/2012	$	3,880.4	$	799.0	$	766.4	1.0x	NM		NM
CEOF I	5/2011	$	1,119.1	$	895.3	$	1,306.6	1.5x	31	%	21	%
CGFSP II (12)	4/2013	$	1,000.0	$	170.9	$	203.0	1.2x	NM		NM
All Other Funds (11)	Various			$	1,108.5	$	1,078.1	1.0x	(3	)%	(14	)%
Total Funds in the Investment Period				$	7,129.9	$	7,641.0	1.1x	8	%	(5	)%	$	161.0	$	535.3	3.3x	78	%
TOTAL CORPORATE PRIVATE EQUITY (13)				$	61,925.1	$	125,213.3	2.0x	27	%	19	%	$	36,060.6	$	90,490.1	2.5x	29	%

(1) The data presented herein that provides “inception to date” performance results of our segments relates to the period following the formation of the first fund within each segment. For our Corporate Private Equity segment our first fund was formed in 1990.

(2) Represents the original cost of all capital called for investments since inception of the fund.

(3) Represents all realized proceeds combined with remaining fair value, before management fees, expenses and carried interest.

(4) Multiple of invested capital (“MOIC”) represents total fair value, before management fees, expenses and carried interest, divided by cumulative invested capital.

(5) An investment is considered realized when the investment fund has completely exited, and ceases to own an interest in, the investment. An investment is considered partially realized when the total amount of proceeds received in respect of such investment, including dividends, interest or other distributions and/or return of capital, represents at least 85% of invested capital and such investment is not yet fully realized. Because part of our value creation strategy involves pursuing best exit alternatives, we believe information regarding Realized/Partially Realized MOIC and Gross IRR, when considered together with the other investment performance metrics presented, provides investors with meaningful information regarding our investment performance by removing the impact of investments where significant realization activity has not yet occurred. Realized/Partially Realized MOIC and Gross IRR have limitations as measures of investment performance, and should not be considered in isolation. Such limitations include the fact that these measures do not include the performance of earlier stage and other investments that do not satisfy the criteria provided above. The exclusion of such investments will have a positive impact on Realized/Partially Realized MOIC and Gross IRR in instances when the MOIC and Gross IRR in respect of such investments are less than the aggregate MOIC and Gross IRR. Our measurements of Realized/Partially Realized MOIC and Gross IRR may not be comparable to those of other companies that use similarly titled measures. We do not present Realized/Partially Realized performance information separately for funds that are still in the investment period because of the relatively insignificant level of realizations for funds of this type. However, to the extent such funds have had realizations, they are included in the Realized/Partially Realized performance information presented for Total Corporate Private Equity.

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(6) Fully Invested funds are past the expiration date of the investment period as defined in the respective limited partnership agreement. In instances where a successor fund has had its first capital call, the predecessor fund is categorized as fully invested.

(7) Gross Internal Rate of Return (“Gross IRR”) represents the annualized IRR for the period indicated on Limited Partner invested capital based on contributions, distributions and unrealized value before management fees, expenses and carried interest.

(8) Net Internal Rate of Return (“Net IRR”) represents the annualized IRR for the period indicated on Limited Partner invested capital based on contributions, distributions and unrealized value after management fees, expenses and carried interest.

(9) Aggregate includes the following funds: CP I, CMG, CVP I, CVP II, CUSGF III, CEVP, CETP I, CAVP I, CAVP II, CAGP III, Mexico, and MENA.

(10) Includes co-investments and certain other stand-alone investments arranged by us.

(11) Aggregate includes the following funds: CJP III, CGP, CSABF, CSSAF, CBPF, CPF I, CCI, and CETP III.

(12) Returns are not considered meaningful, as the investment period commenced in May 2012 for CP VI, November 2012 for CAP IV, April 2013 for CGFSP II, and August 2013 for CEP IV.

(13) For purposes of aggregation, funds that report in foreign currency have been converted to U.S. dollars at the reporting period spot rate.

	Remaining Fair Value(1)		Unrealized MOIC(2)	Total MOIC(3)	% Invested(4)		In Accrued Carry/ (Clawback) (5)	LTM Realized Carry (6)	Catch-up Rate		Fee Initiation Date(7)	Quarters Since Fee Initiation	Original Investment Period End Date
		As of March 31, 2015
Corporate Private Equity		(Reported in Local Currency, in Millions)
CP V	$	12,268.1	2.1x	2.0x	93	%	X	X	100	%	Jun-07	32	May-13
CEP III	€	4,651.2	2.3x	2.1x	94	%	X	X	100	%	Jul-07	31	Dec-12
CP VI	$	3,854.7	1.0x	1.0x	29	%			100	%	Jun-13	8	May-18
CAP III	$	2,395.9	1.1x	1.6x	98	%	X		100	%	Jun-08	28	May-14
CP IV	$	1,657.1	1.6x	2.4x	97	%	X	X	80	%	Apr-05	40	Dec-10
CGFSP I	$	1,159.9	1.5x	1.8x	96	%	X	X	100	%	Oct-08	26	Sep-14
CAP II	$	1,008.2	1.1x	1.7x	90	%	(X)		80	%	Mar-06	37	Feb-12
CEOF I	$	1,002.9	1.3x	1.5x	80	%	X		80	%	Sep-11	15	May-17
CAP IV	$	999.0	1.0x	1.0x	21	%			100	%	Jul-13	7	Nov-18
CJP II	¥	102,881.8	1.3x	1.3x	86	%			80	%	Oct-06	34	Jul-12
CAGP IV	$	795.0	1.2x	1.5x	78	%			100	%	Aug-08	27	Jun-14
CEP II	€	504.1	0.9x	2.0x	113	%	X		80	%	Sep-03	47	Sep-08
CETP II	€	475.1	1.6x	2.2x	83	%	X	X	100	%	Jan-08	29	Jul-13
CEP IV	€	302.7	0.9x	0.9x	16	%			100	%	Sep-14	3	Aug-19
CGFSP II	$	209.9	1.2x	1.2x	17	%			100	%	Jun-13	8	Dec-17
All Other Funds (8)	$	2,205.4	1.1x	2.2x			NM	NM
Coinvestment and Other (9)	$	4,415.2	1.9x	2.5x			NM	NM
Total Corporate Private Equity (10)	$	39,194.2	1.5x	2.0x

(1) Net asset value of our carry funds. Reflects significant funds with remaining fair value of greater than $100 million.

(2) Unrealized multiple of invested capital (“MOIC”) represents remaining fair market value, before management fees, expenses and carried interest, divided by investment cost.

(3) Total MOIC represents total fair value, before management fees, expenses and carried interest, divided by cumulative invested capital

(4) Represents cumulative equity invested as of the reporting period divided by total commitments. Amount can be greater than 100% due to the re-investment of recallable distributions to fund investors.

(5) Fund has accrued carry/(clawback) as of the reporting period.

(6) Fund has realized carry in the last twelve months.

(7) Represents the date of the first capital contribution for management fees.

(8) Aggregate includes the following funds: CMG, CP I, CP II, CP III, CEP I, CAP I, CBPF, CJP I, CJP III, CEVP, CETP I, CETP III, CCI, CAVP I, CAVP II, CAGP III, Mexico, MENA, CSABF, CSSAF, CPF, CGP, CVP I, CVP II, and CUSGF III. In Accrued Carry/(Clawback) and LTM Realized Carry not indicated because the indicator does not apply to each fund within the aggregate.

(9) Includes co-investments, prefund investments and certain other stand-alone investments arranged by us. In Accrued Carry/(Clawback) and LTM Realized Carry not indicated because the indicator does not apply to each fund within the aggregate.

(10) For purposes of aggregation, funds that report in foreign currency have been converted to U.S. dollars at the reporting period spot rate.

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Global Market Strategies

For purposes of presenting our results of operations for this segment, we include only our 55% economic interest in the results of operations of each of Claren Road, ESG and Vermillion. The following table presents our results of operations for our Global Market Strategies segment:

	Three Months Ended March 31,
	2015			2014
	(Dollars in millions)
Segment Revenues
Fund level fee revenues
Fund management fees	$	55.5		$	63.2
Portfolio advisory fees, net	0.5			0.1
Transaction fees, net	—			—
Total fund level fee revenues	56.0			63.3
Performance fees
Realized	4.6			8.3
Unrealized	18.7			49.5
Total performance fees	23.3			57.8
Investment income (loss)
Realized	1.6			1.3
Unrealized	(4.2		)	1.9
Total investment income (loss)	(2.6		)	3.2
Interest and other income	1.8			1.3
Total revenues	78.5			125.6
Segment Expenses
Compensation and benefits
Direct base compensation	28.2			27.5
Indirect base compensation	8.8			6.0
Equity-based compensation	5.2			2.7
Performance fee related
Realized	2.3			3.8
Unrealized	8.2			14.8
Total compensation and benefits	52.7			54.8
General, administrative, and other indirect expenses	12.3			11.6
Depreciation and amortization expense	1.1			0.9
Interest expense	2.8			2.1
Total expenses	68.9			69.4
Economic Net Income	$	9.6		$	56.2
(-) Net Performance Fees	12.8			39.2
(-) Investment Income (Loss)	(2.6		)	3.2
(+) Equity-based Compensation	5.2			2.7
(=) Fee Related Earnings	$	4.6		$	16.5
(+) Realized Net Performance Fees	2.3			4.5
(+) Realized Investment Income	1.6			1.3
(=) Distributable Earnings	$	8.5		$	22.3

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Three Months Ended March 31, 2015 Compared to the Three Months Ended March 31, 2014

Total fee revenues were $56.0 million for the three months ended March 31, 2015, a decrease of $7.3 million from 2014. The decrease was due primarily to lower management fees as a result of $2.1 billion of net redemptions in the hedge funds in the three months ended March 31, 2015. The weighted average management fee rate on our hedge funds decreased from 1.75% to 1.69% compared to the prior year period due to higher AUM in the ESG hedge funds, which charge a lower rate. The weighted average management fee rate on our carry funds increased from 1.45% to 1.48% due to lower AUM in our two corporate mezzanine funds ("CMP I" and "CMP II"), which charge a lower rate.

Interest and other income was $1.8 million for the three months ended March 31, 2015 as compared to $1.3 million for the same period in 2014.

Total compensation and benefits was $52.7 million and $54.8 million for the three months ended March 31, 2015 and 2014, respectively. Performance fee related compensation expense was $10.5 million and $18.6 million for the three months ended March 31, 2015 and 2014, respectively. With respect to Claren Road, ESG and Vermillion, where we only include our respective 55% economic interests in our Non-GAAP results, performance fee related compensation expense can vary as a percentage of performance fees based upon a variety of factors, including absolute and relative performance to comparable peers. As a result, the percentage of performance fee related compensation expense to performance fees is generally not a comparable measurement for Global Market Strategies from period to period.

Direct and indirect base compensation increased$3.5 million for the three months ended March 31, 2015 as compared to 2014, which relates to incremental compensation costs related to internal fundraising activities, primarily associated with our second energy mezzanine fund, and increased headcount. Further, we have not yet commenced charging management fees on our second energy mezzanine fund.

Equity-based compensation was $5.2 million for the three months ended March 31, 2015, an increase of $2.5 million from $2.7 million for the three months ended March 31, 2014. The increase is due primarily to the ongoing granting of deferred restricted common units to new and existing employees during 2014 and 2015 and a decrease in the estimated forfeiture rates during the three months ended March 31, 2015.

General, administrative and other indirect expenses increased$0.7 million to $12.3 million for the three months ended March 31, 2015 as compared to 2014.

Depreciation and amortization expense was $1.1 million for the three months ended March 31, 2015, an increase from $0.9 million in 2014.

Interest expense increased$0.7 million, or 33%, for the three months ended March 31, 2015 as compared to 2014. The increase was due primarily to the allocated interest on $200 million of 5.625% senior notes due 2043 issued in March 2014.

Economic Net Income. ENI was $9.6 million for the three months ended March 31, 2015, a decrease of $46.6 million from $56.2 million for the three months ended March 31, 2014. The decrease in ENI for the three months ended March 31, 2015 as compared to 2014 was primarily driven by a decrease in net performance fees of $26.4 million, a decrease in fee related earnings of $11.9 million, a decrease in investment income of $5.8 million, and an increase in equity-based compensation of $2.5 million.

Fee Related Earnings. Fee related earnings decreased$11.9 million to $4.6 million for the three months ended March 31, 2015 as compared to 2014. The decrease was primarily due to a decrease in fee revenues of $7.3 million, an increase in base compensation of $3.5 million, and an increase in general, administrative and other indirect expenses of $0.7 million.

96

Performance Fees. Performance fees of $23.3 million and $57.8 million for the three months ended March 31, 2015 and 2014, respectively, are inclusive of performance fees reversed of approximately $0.2 million and $3.2 million, respectively. Performance fees for this segment by type of fund are as follows:

	Three Months Ended March 31,
	2015		2014
	(Dollars in millions)
Carry funds	$	17.0	$	13.7
Hedge funds	1.9		38.1
Structured credit funds	4.4		6.0
Business development companies	—		—
Performance fees	$	23.3	$	57.8

Performance fees for the three months ended March 31, 2015 were generated primarily by our carry funds, including $5.9 million from CMP II and $4.8 million from our first energy mezzanine fund ("CEMOF I"). Our carry funds in this segment appreciated 3% in the three months ended March 31, 2015 and 2014, respectively. Performance fees for the three months ended March 31, 2014, were generated primarily by the hedge funds, including $19.5 million from the Claren Road Master Fund and $13.2 million from the Claren Road Opportunities fund.

Net performance fees decreased$26.4 million to $12.8 million for the three months ended March 31, 2015 as compared to $39.2 million for the same period in 2014.

Investment Income (Loss). Investment loss was $2.6 million for the three months ended March 31, 2015 as compared to investment income of $3.2 million for the same period in 2014. During the three months ended March 31, 2015, realized investment income was $1.6 million as compared to $1.3 million in 2014. Unrealized investment loss was $4.2 million for the three months ended March 31, 2015 as compared to an unrealized investment income of $1.9 million in 2014. The unrealized investment losses in 2015 were due primarily to the decline in the Euro exchange rate and its impact on investments in Euro-denominated collateralized loan obligation investments.

Distributable Earnings. Distributable earnings decreased$13.8 million to $8.5 million for the three months ended March 31, 2015 from $22.3 million for the three months ended March 31, 2014. The decrease was due primarily to a decrease in fee related earnings of $11.9 million and a decrease in realized net performance fees of $2.2 million. These decreases were partially offset by an increase in realized investment income of $0.3 million for the three months ended March 31, 2015 as compared to 2014.

97

Fee-earning AUM as of and for the Three Months Ended March 31, 2015 and 2014

Fee-earning AUM is presented below for each period together with the components of change during each respective period.

The table below breaks out Fee-earning AUM by its respective components at each period.

	As of March 31,
	2015			2014
Global Market Strategies	(Dollars in millions)
Components of Fee-earning AUM (1)
Fee-earning AUM based on capital commitments	$	1,916		$	1,916
Fee-earning AUM based on invested capital	595			848
Fee-earning AUM based on collateral balances, at par	17,701			17,212
Fee-earning AUM based on net asset value	10,783			13,975
Fee-earning AUM based on other (2)	995			395
Total Fee-earning AUM	$	31,990		$	34,346
Weighted Average Management Fee Rates (3)
All Funds, excluding CLOs	1.65		%	1.70		%

(1) For additional information concerning the components of Fee-earning AUM, see “—Fee-earning Assets under Management.”

(2) Includes funds with fees based on gross asset value.

(3) Represents the aggregate effective management fee rate for carry funds and hedge funds, weighted by each fund’s Fee-earning AUM, as of the end of each period presented. Management fees for CLOs are based on the total par amount of the assets (collateral) and principal balance of the notes in the fund and are not calculated as a percentage of equity and are therefore not included.

98

The table below provides the period to period rollforward of Fee-earning AUM.

	Three Months Ended   March 31,
	2015			2014
Global Market Strategies	(Dollars in millions)
Fee-earning AUM Rollforward
Balance, Beginning of Period	$	33,898		$	33,411
Inflows, including Fee-paying Commitments (1)	6			136
Outflows, including Distributions (2)	(63		)	(301		)
Subscriptions, net of Redemptions (3)	(2,085		)	103
Changes in CLO collateral balances (4)	726			719
Market Appreciation/(Depreciation) (5)	55			282
Foreign Exchange and other (6)	(547		)	(4		)
Balance, End of Period	$	31,990		$	34,346

(1) Inflows represent limited partner capital raised and capital invested by our carry funds outside the investment period.

(2) Outflows represent limited partner distributions from our carry funds and changes in fee basis for our carry funds where the investment period has expired.

(3) Represents subscriptions and redemptions in our hedge funds and mutual fund.

(4) Represents the change in the aggregate Fee-earning collateral balances and principal balances at par of our CLOs/structured products, as of the quarterly cut-off dates.

(5) Market Appreciation/ (Depreciation) represents changes in the net asset value of our hedge funds and mutual fund.

(6) Represents the impact of foreign exchange rate fluctuations on the translation of our non-U.S. dollar denominated funds and other changes in Total AUM. Activity during the period is translated at the average rate for the period. Ending balances are translated at the spot rate as of the period end.

Fee-earning AUM was $32.0 billion at March 31, 2015, a decrease of $1.9 billion, or approximately 6%, compared to $33.9 billion at December 31, 2014. This decrease was primarily a result of net redemptions of $2.1 billion in our hedge funds and decreases from foreign exchange on our Euro-denominated CLOs of $0.5 billion. Offsetting this decrease were net increases in our CLO collateral balances of $0.7 billion, including the launch of two new-issue CLOs totaling $1.2 billion. Distributions from carry funds still in the investment period do not impact Fee-earning AUM as these funds are based on commitments and not invested capital. Commitments from our second energy mezzanine fund ("CEMOF II"), do not increase Fee-earning AUM, as their fees have not yet commenced.

Fee-earning AUM was $32.0 billion at March 31, 2015, a decrease of $2.4 billion, or approximately 7%, compared to $34.3 billion at March 31, 2014. This decrease was driven by market depreciation of $1.8 billion, net redemptions of $1.4 billion in our hedge funds and a decrease of $0.7 billion due to foreign exchange on our Euro-denominated CLOs. This decrease was offset by net increases of $1.9 billion in our CLO collateral balances.

Fee-earning AUM was $34.3 billion at March 31, 2014, an increase of $0.9 billion, or approximately 3%, compared to $33.4 billion at December 31, 2013. This increase was primarily a result of increases in the aggregate par value of our CLO collateral balances of $0.7 billion, partially due to the launch of two new CLOs totaling $1.2 billion, and market appreciation and net subscriptions in our hedge funds of $0.3 billion and $0.1 billion, respectively. Outflows of $0.3 billion were primarily driven by the step-down in management fee basis from commitments to invested equity for CMP II and distributions from our fully invested funds.

99

Total AUM as of and for the Three Months Ended March 31, 2015.

The table below provides the period to period rollforwards of Available Capital and Fair Value of Capital, and the resulting rollforward of Total AUM.

	Three Months Ended March 31, 2015
	Available Capital			Fair Value of Capital			Total AUM
	(Dollars in millions)
Global Market Strategies
Balance, Beginning of Period	$	1,512		$	35,229		$	36,741
Commitments (1)	1,321			—			1,321
Capital Called, net (2)	(65		)	147			82
Distributions (3)	55			(115		)	(60		)
Subscriptions, net of Redemptions (4)	—			(2,142		)	(2,142		)
Changes in CLO collateral balances (5)	—			883			883
Market Appreciation/(Depreciation) (6)	—			147			147
Foreign Exchange and other (7)	3			(639		)	(636		)
Balance, End of Period (8)	$	2,826		$	33,510		$	36,336

(1) Represents capital raised by our carry funds, net of expired available capital.

(2) Represents capital called by our carry funds and business development companies, net of fund fees and expenses. Equity invested amounts may vary from capital called due to timing differences between acquisition and capital call dates.

(3) Represents distributions from our carry funds and business development companies, net of amounts recycled. Distributions are based on when proceeds are actually distributed to investors, which may differ from when they are realized.

(4) Represents the net result of subscriptions to and redemptions from our hedge funds and mutual fund.

(5) Represents the change in the aggregate collateral balance and principal cash and principal notes at par of the CLOs/structured products.

(6) Market Appreciation/(Depreciation) represents realized and unrealized gains (losses) on portfolio investments and changes in the net asset value of our hedge funds and mutual fund.

(7) Represents the impact of foreign exchange rate fluctuations on the translation of our non-U.S. dollar denominated funds and other changes in AUM. Activity during the period is translated at the average rate for the period. Ending balances are translated at the spot rate as of the period end.

(8) Ending balance is comprised of approximately $18.7 billion from our structured credit /other structured product funds, $11.3 billion in our hedge funds, $5.3 billion (including $2.8 billion of Available Capital) in our carry funds, $1.0 billion from our business development companies, and $0.1 billion in our mutual fund.

Total AUM was $36.3 billion at March 31, 2015, a decrease of $0.4 billion, or over 1%, compared to $36.7 billion at December 31, 2014. This decrease was primarily a result of net redemptions of $2.1 billion in our hedge funds and decreases from foreign exchange of $0.6 billion in our Euro-denominated CLOs. These were offset by inflows of $1.3 billion related to closings in CEMOF II and our Asia structured credit opportunities fund ("CASCOF"), in addition to a $0.9 billion net increase in the the par value of our CLO collateral balances.

Fund Performance Metrics

Fund performance information for certain of our Global Market Strategies funds is included throughout this discussion and analysis to facilitate an understanding of our results of operations for the periods presented. The fund return information reflected in this discussion and analysis is not indicative of the performance of The Carlyle Group L.P. and is also not necessarily indicative of the future performance of any particular fund. An investment in The Carlyle Group L.P. is not an investment in any of our funds. There can be no assurance that any of our funds or our other existing and future funds will achieve similar returns.

100

The following table reflects the performance of certain carry funds in our Global Market Strategies business. These tables separately present carry funds that, as of March 31, 2015, had at least $1.0 billion in capital commitments, cumulative equity invested or total equity value. Please see “— Our Family of Funds” for a legend of the fund acronyms listed below.

				TOTAL INVESTMENTS
				As of March 31, 2015					Inception to March 31, 2015
	Fund Inception Date(1)	Committed Capital		Cumulative Invested Capital(2)		Total Fair Value(3)		MOIC(4)	Gross IRR(5)		Net IRR(6)
Global Market Strategies	(Reported in Local Currency, in Millions)
CSP II	6/2007	$	1,352.3	$	1,352.3	$	2,446.6	1.8x	17	%	12	%
CEMOF I	12/2010	$	1,382.5	$	1,062.7	$	1,408.8	1.3x	24	%	13	%

(1) The data presented herein that provides “inception to date” performance results of our segments relates to the period following the formation of the first fund within each segment. For our Global Market Strategies segment, CSP II was formed in 2007 and CEMOF I was formed in 2010.

(2) Represents the original cost of investments net of investment level recallable proceeds which is adjusted to reflect recyclability of invested capital for the purpose of calculating the fund MOIC.

(3) Represents all realized proceeds combined with remaining fair value, before management fees, expenses and carried interest.

(4) Multiple of invested capital (“MOIC”) represents total fair value, before management fees, expenses and carried interest, divided by cumulative invested capital.

(5) Gross Internal Rate of Return (“Gross IRR”) represents the annualized IRR for the period indicated on Limited Partner invested capital based on contributions, distributions and unrealized value before management fees, expenses and carried interest.

(6) Net Internal Rate of Return (“Net IRR”) represents the annualized IRR for the period indicated on Limited Partner invested capital based on contributions, distributions and unrealized value after management fees, expenses and carried interest.

Remaining  Fair Value(1)

Unrealized MOIC(2)

Total MOIC(3)

% Invested(4)

In Accrued Carry/ (Clawback) (5)

LTM Realized Carry (6)

Catch-up Rate

Fee Initiation Date(7)

Quarters Since  Fee Initiation

Original Investment Period End Date

As of March 31, 2015

Global Market Strategies

(Reported in Local Currency, in Millions)

CEMOF I

$

1,018.0

1.1x

1.3x

77

%

X

100

%

Dec-10

18

Dec-15

CSP II

$

417.0

0.9x

1.8x

100

%

X

X

80

%

Dec-07

30

Jun-11

All Other Funds (8)

$

667.0

1.2x

1.5x

NM

NM

Coinvestment and Other (9)

$

409.6

1.1x

1.3x

NM

NM

Total Global Market Strategies

$

2,511.6

1.1x

1.6x

(1) Net asset value of our carry funds. Reflects significant funds with remaining fair value of greater than $100 million.

(2) Unrealized multiple of invested capital (“MOIC”) represents remaining fair market value, before management fees, expenses and carried interest, divided by investment cost.

(3) Total MOIC represents total fair value, before management fees, expenses and carried interest, divided by cumulative invested capital. For certain funds, represents the original cost of investments net of investment level recallable proceeds, which is adjusted to reflect recyclability of invested capital for the purpose of calculating the fund MOIC.

(4) Represents cumulative equity invested as of the reporting period divided by total commitments. Amount can be greater than 100% due to the re-investment of recallable distributions to fund investors.

(5) Fund has accrued carry/(clawback) as of the reporting period.

(6) Fund has realized carry in the last twelve months.

(7) Represents the date of the first capital contribution for management fees.

(8) Aggregate includes the following funds: CSP I, CSP III, CMP I, CMP II, and CASCOF. In Accrued Carry/(Clawback) and LTM Realized Carry not indicated because the indicator does not apply to each fund within the aggregate.

(9) Includes co-investments, prefund investments and certain other stand-alone investments arranged by us. In Accrued Carry/(Clawback) and LTM Realized Carry not indicated because the indicator does not apply to each fund within the aggregate.

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The Claren Road Master Fund, the Claren Road Opportunities Fund, the ESG Cross Border Equity Master Fund Ltd., and the ESG Domestic Opportunity Master Fund Ltd. (our “reported hedge funds”), had AUM of approximately $3.5 billion, $1.8 billion, $3.4 billion, and $1.3 billion, respectively, as of March 31, 2015. The asset-weighted hedge fund performance of our reported hedge funds was 2% during the quarter ended March 31, 2015. Refer to our Annual Report on Form 10-K for the year ended December 31, 2014 for the hedge fund performance tables that present annual and inception-to-date returns for each of our reported hedge funds as of such date.

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Real Assets

For purposes of presenting results of operations for this segment, our earnings from our investments in NGP are presented in the respective operating captions, and the net income or loss from the consolidation of Urbplan allocable to the Partnership (after consideration of amounts allocable to non-controlling interests) is presented within investment income. The following table presents our results of operations for our Real Assets segment:

	Three Months Ended March 31,
	2015			2014
	(Dollars in millions)
Segment Revenues
Fund level fee revenues
Fund management fees	$	66.3		$	50.3
Portfolio advisory fees, net	0.1			0.2
Transaction fees, net	0.3			—
Total fund level fee revenues	66.7			50.5
Performance fees
Realized	7.7			0.5
Unrealized	14.1			14.0
Total performance fees	21.8			14.5
Investment income (loss)
Realized	(86.4		)	2.1
Unrealized	50.2			(20.6		)
Total investment income (loss)	(36.2		)	(18.5		)
Interest and other income	1.1			0.7
Total revenues	53.4			47.2
Segment Expenses
Compensation and benefits
Direct base compensation	18.5			18.7
Indirect base compensation	12.3			14.3
Equity-based compensation	7.1			3.5
Performance fee related
Realized	1.8			0.2
Unrealized	28.9			8.4
Total compensation and benefits	68.6			45.1
General, administrative, and other indirect expenses	14.6			15.5
Depreciation and amortization expense	0.9			0.9
Interest expense	2.7			2.2
Total expenses	86.8			63.7
Economic Net Income (Loss)	$	(33.4	)	$	(16.5	)
(-) Net Performance Fees	(8.9		)	5.9
(-) Investment Income (Loss)	(36.2		)	(18.5		)
(+) Equity-based Compensation	7.1			3.5
(=) Fee Related Earnings	$	18.8		$	(0.4	)
(+) Realized Net Performance Fees	5.9			0.3
(+) Realized Investment Income (Loss)	(86.4		)	2.1
(=) Distributable Earnings	$	(61.7	)	$	2.0

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Three Months Ended March 31, 2015 Compared to the Three Months Ended March 31, 2014

Total fee revenues were $66.7 million for the three months ended March 31, 2015, an increase of $16.2 million from March 31, 2014. The increase in fund management fees primarily reflects $10.3 million of catch-up management fees earned in 2015 from subsequent closings on our seventh real estate buyout fund ("CRP VII") and our first international energy fund ("CIEP I"). Also, management fees in 2015 include $8.2 million of on-going management fees from CRP VII, which commenced its investment period in June 2014 and began charging management fees at such time. These increases were partially offset by declines in fund management fees from distributions from certain other U.S. and European real estate funds outside of their investment periods. The total weighted average management fee increased to 1.33% at March 31, 2015 from 1.24% at March 31, 2014 primarily due to commitments to CRP VII and CIEP I. The weighted average management fee rate for funds in the investment period increased to 1.60% at March 31, 2015 from 1.30% at March 31, 2014 due to fundraising in CRP VII and CIEP I, the latter of which charges a higher effective management fee rate compared to other funds in the investment period.

Interest and other income was $1.1 million for the three months ended March 31, 2015, an increase from $0.7 million for the same period in 2014.

Total compensation and benefits was $68.6 million and $45.1 million for the three months ended March 31, 2015 and 2014, respectively. Performance fee related compensation expense was $30.7 million and $8.6 million for the three months ended March 31, 2015 and 2014, respectively. Performance fees earned from the Legacy Energy funds and from NGP funds are allocated solely to Carlyle and are not otherwise shared or allocated with our investment professionals. Accordingly, performance fee compensation as a percentage of performance fees is generally not a comparable measurement for Real Assets from period to period.

Direct and indirect base compensation was $30.8 million for the three months ended March 31, 2015, a decline from the $33.0 million of expense for the same period in 2014. The decline was due primarily to lower compensation associated with fundraising of $2.5 million in 2015 versus 2014, driven by fundraising activities in 2014 related to CRP VII and CIEP I.

Equity-based compensation was $7.1 million for the three months ended March 31, 2015, an increase of $3.6 million from $3.5 million for the three months ended March 31, 2014. The increase is due primarily to the ongoing granting of deferred restricted common units to new and existing employees during 2014 and 2015 and a decrease in the estimated forfeiture rates during the three months ended March 31, 2015.

General, administrative and other indirect expenses declined$0.9 million to $14.6 million for the three months ended March 31, 2015 as compared to the same period of 2014. The a decline primarily relates to lower external costs associated with fundraising activities in 2015 as compared to 2014.

Depreciation and amortization expense was $0.9 million for the three months ended March 31, 2015 and 2014.

Interest expense increased$0.5 million, or 23%, for the three months ended March 31, 2015 as compared to 2014. The increase was due primarily to the allocated interest on $200 million of 5.625% senior notes due 2043 issued in March 2014.

Economic Net Income (Loss). ENI was $(33.4) million for the three months ended March 31, 2015, a decline of $16.9 million from $(16.5) million for the same period in 2014. The decline in ENI for the three months ended March 31, 2015 as compared to 2014 was primarily driven by an increase in investment loss of $17.7 million, a decrease in net performance fees of $14.8 million, and an increase in equity-based compensation of $3.6 million. These declines were partially offset by an increase in fee related earnings of $19.2 million.

Fee Related Earnings. Fee related earnings increased$19.2 million for the three months ended March 31, 2015 as compared to 2014 to $18.8 million. The increase in fee related earnings is primarily attributable to an increase in fee revenues of $16.2 million, a decline in base compensation of $2.2 million, and a decline in general, administrative, and other indirect expenses of $0.9 million.

104

Performance Fees. Performance fees of $21.8 million and $14.5 million for the three months ended March 31, 2015 and 2014, respectively, are inclusive of performance fees reversed of approximately $52.6 million and $10.6 million, respectively. Performance fees and appreciation in remaining value of assets for this segment by type of fund are as follows:

	Performance Fees						Carry Fund Portfolio Appreciation / (Depreciation)
	Three Months Ended March 31,						Three Months Ended March 31,
	2015			2014			2015	2014
	(Dollars in millions)
Real Estate funds (1)	$	67.2		$	16.1		11%	2%
Natural Resources funds (1)	(9.0		)	(0.1		)	1%
Legacy Energy funds (1)	(36.4		)	(1.5		)	(3)%	1%
Total	$	21.8		$	14.5		2%	2%

(1) During the three months ended September 30, 2014, we created the "Legacy Energy funds" category to include our energy and renewable resources funds that we jointly advise with Riverstone Holdings L.L.C. We also created the "Natural Resources funds" category to include NGP carry funds, our infrastructure, power, and international energy funds. Our infrastructure and power funds were previously classified as part of our "Real Estate funds" category. Prior periods have been reclassified to conform with the current presentation.

Performance fees for the three months ended March 31, 2015 were primarily driven by performance fees related to our sixth and fifth U.S. real estate funds ("CRP VI" and "CRP V", respectively), Energy III, and NGP's tenth energy fund ("NGP X") of $27.2 million, $25.0 million, $(25.1) million, and $(14.5) million, respectively. Performance fees for the three months ended March 31, 2014 were primarily driven by performance fees related to CRP VI of $13.9 million.

Net performance fees for the three months ended March 31, 2015 were $(8.9) million, representing a decline of $14.8 million from $5.9 million in net performance fees for the three months ended March 31, 2014.

Investment Income (Loss). Investment loss was $36.2 million for the three months ended March 31, 2015 compared to an investment loss of $18.5 million for the same period in 2014. The 2015 investment loss was due primarily to $34 million in Carlyle investment losses associated with an adverse court judgment in a French tax court proceeding related to a transaction that CEREP I exited between 2007 and 2009. See Note 11 to the unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q for additional information. The 2014 investment loss was due primarily to investment losses on certain other European real estate investments of $12.6 million and the Partnership's allocation of Urbplan's net losses for the period of $9.6 million.

Realized investment losses in 2015 primarily represent the realization of Carlyle's cumulative investment losses associated with the CEREP I French tax court matter of $80 million and realized investment losses associated with Urbplan of $8 million.

Distributable Earnings (Loss). Distributable earnings declined$63.7 million to $(61.7) million for the three months ended March 31, 2015 from $2.0 million for the same period in 2014. The decline was primarily due to an increase in realized investment loss of $88.5 million. This increase in realized investment losses was partially offset by a $19.2 millionincrease in fee related earnings and a $5.6 millionincrease in realized net performance fees for the three months ended March 31, 2015 as compared to 2014.

105

Fee-earning AUM as of and for the Three Months Ended March 31, 2015 and 2014

Fee-earning AUM is presented below for each period together with the components of change during each respective period.

The table below breaks out Fee-earning AUM by its respective components at each period.

	As of March 31,
	2015			2014
Real Assets	(Dollars in millions)
Components of Fee-earning AUM (1)
Fee-earning AUM based on capital commitments	$	6,397		$	6,680
Fee-earning AUM based on invested capital (2)	20,511			19,942
Fee-earning AUM based on lower of cost or fair value and other (3)	679			794
Total Fee-earning AUM (4)	$	27,587		$	27,416
Weighted Average Management Fee Rates (5)
All Funds	1.33		%	1.24		%
Funds in Investment Period	1.60		%	1.30		%

(1) For additional information concerning the components of Fee-earning AUM, See “—Fee-earning Assets under Management.”

(2) Includes amounts committed to or reserved for investments for certain real estate funds.

(3) Includes certain funds that are calculated on gross asset value.

(4) Energy II, Energy III, Energy IV, Renew I, and Renew II (collectively, the “Legacy Energy Funds”), are managed with Riverstone Holdings LLC and its affiliates. Affiliates of both Carlyle and Riverstone act as investment advisers to each of the Legacy Energy Funds. With the exception of Energy IV and Renew II, where Carlyle has a minority representation on the funds’ management committees, management of each of the Legacy Energy Funds is vested in committees with equal representation by Carlyle and Riverstone, and the consent of representatives of both Carlyle and Riverstone is required for investment decisions. As of March 31, 2015, the Legacy Energy Funds had, in the aggregate, approximately $9.2 billion in AUM and $7.2 billion in Fee-earning AUM. NGP VII, NGP VIII, NGP IX, or in the case of NGP M&R, NGP ETP I, NGP ETP II, and NGPC, certain affiliated entities (collectively, the “NGP management fee funds”) and NGP X, NGP GAP and NGP XI (referred to herein as, "carry funds"), are managed by NGP Energy Capital Management. As of March 31, 2015, the NGP management fee funds and carry funds had, in the aggregate, approximately $15.2 billion in AUM and $7.8 billion in Fee-earning AUM.

(5) Represents the aggregate effective management fee rate of each fund in the segment, weighted by each fund's Fee-earning AUM, as of the end of each period presented. Calculation reflects Carlyle’s 10% and 55% interest in management fees earned by the Legacy Energy funds, NGP management fee funds, and carry funds, respectively. Accounts based on gross asset base generally have an effective management fee rate of 0.5% or less.

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The table below provides the period to period rollforward of Fee-earning AUM.

	Three months ended March 31,
	2015			2014
Real Assets	(Dollars in millions)
Fee-earning AUM Rollforward
Balance, Beginning of Period	$	28,351		$	28,438
Inflows, including Fee-paying Commitments (1)	1,174			408
Outflows, including Distributions (2)	(1,734		)	(1,454		)
Market Appreciation/(Depreciation) (3)	(2		)	3
Foreign Exchange and other (4)	(202		)	21
Balance, End of Period	$	27,587		$	27,416

(1) Inflows represent limited partner capital raised and capital invested by funds outside the investment period.

(2) Outflows represent distributions from funds outside the investment period and changes in fee basis for our carry funds where the investment period has expired.

(3) Market Appreciation/(Depreciation) represents realized and unrealized gains (losses) on portfolio investments in our carry fund based on the lower of cost or fair value.

(4) Represents the impact of foreign exchange rate fluctuations on the translation of our non-U.S. dollar denominated funds. Activity during the period is translated at the average rate for the period. Ending balances are translated at the spot rate as of the period end.

Fee-earning AUM was $27.6 billion at March 31, 2015, a decrease of $0.8 billion, or approximately 3%, compared to $28.4 billion at December 31, 2014. This decrease was driven by outflows of $1.7 billion, primarily related to a reduction in one of our NGP management fee funds for which we are no longer calling fees and distribution activity in our funds outside the original investment period, in addition to foreign exchange decreases of $0.2 billion. The decrease was offset by inflows of $1.2 billion, primarily related to commitments in CRP VII, CIEP I and NGP XI. Commitments of $4.5 billion to NGP XI will be based on invested equity until January 1, 2016, after which they will be based on commitments until the first investment realization. Investment and distribution activity by funds still in the investment period do not impact Fee-earning AUM as these funds are based on commitments and not invested capital. Changes in fair value have no impact on Fee-earning AUM for Real Assets as substantially all of the funds generate management fees based on either commitments or invested capital at cost, neither of which is impacted by fair value movements.

Fee-earning AUM was $27.6 billion at March 31, 2015, an increase of $0.2 billion, or less than 1%, compared to $27.4 billion at March 31, 2014. This increase was primarily related to the inflows of $6.9 billion, primarily due to new commitments in CRP VII, CIEP I, CPP II, and NGP XI and purchases in several of our funds outside the original investment period. Offsetting the increase were outflows of $6.1 billion for distribution across several funds outside the original investment period, a change in fee basis for CRP VI and NGP X due to the activation of their successor funds, and an elimination of basis for on of our NGP management fee funds.

Fee-earning AUM was $27.4 billion at March 31, 2014, a decrease of $1.0 billion, or more than 3%, compared to $28.4 billion at December 31, 2013. The decrease was driven by outflows of $1.5 billion primarily related to a change in fee basis from commitments to invested capital in one of our Legacy Energy funds, Riverstone/Carlyle Renewable Energy Infrastructure Fund II, L.P. (“Renew II”). Partially offsetting this decrease were inflows of $0.4 billion attributable to new limited partner commitments in CIEP I.

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Total AUM as of and for the Three Months Ended March 31, 2015

The table below provides the period to period rollforwards of Available Capital and Fair Value of Capital, and the resulting rollforward of Total AUM.

	Three Months Ended March 31, 2015
	Available Capital			Fair Value of Capital			Total AUM
	(Dollars in millions)
Real Assets
Balance, Beginning of Period	$	15,714		$	26,581		$	42,295
Commitments (1)	1,890			—			1,890
Capital Called, net (2)	(912		)	883			(29		)
Distributions (3)	39			(1,094		)	(1,055		)
Market Appreciation/(Depreciation) (4)	—			—			—
Foreign Exchange and other (5)	(49		)	(195		)	(244		)
Balance, End of Period	$	16,682		$	26,175		$	42,857

(1) Represents capital raised by our carry funds and NGP management fee funds, net of expired available capital.

(2) Represents capital called by our carry funds and NGP management fee funds, net of fund fees and expenses. Equity invested amounts may vary from capital called due to timing differences between acquisition and capital call dates.

(3) Represents distributions from our carry funds and NGP management fee funds, net of amounts recycled. Distributions are based on when proceeds are actually distributed to investors, which may differ from when they are realized.

(4) Market Appreciation/(Depreciation) represents realized and unrealized gains (losses) on portfolio investments.

(5) Represents the impact of foreign exchange rate fluctuations on the translation of our non-U.S. dollar denominated funds. Activity during the period is translated at the average rate for the period. Ending balances are translated at the spot rate as of the period end.

Total AUM was $42.9 billion at March 31, 2015, an increase of $0.6 billion, or 1%, compared to $42.3 billion at December 31, 2014. This increase was driven by $1.9 billion of new commitments raised in NGP XI, CRP VII, CIEP I, and CPP II. The increase was partially offset by distributions of $1.1 billion and $0.2 billion of foreign exchange decreases. Our portfolio experienced a 2% increase in value over the period, due to a 11% increase in our real estate funds and a 1% increase in our natural resources funds, however, this appreciation in our carry funds was offset by market depreciation in our NGP management fee funds, yielding no net impact on Total AUM.

Fund Performance Metrics

Fund performance information for our carry funds that generally have at least $1.0 billion in capital commitments, cumulative equity invested or total value as of March 31, 2015, which we refer to as our “significant funds,” is included throughout this discussion and analysis to facilitate an understanding of our results of operations for the periods presented. The fund return information reflected in this discussion and analysis is not indicative of the performance of The Carlyle Group L.P. and is also not necessarily indicative of the future performance of any particular fund. An investment in The Carlyle Group L.P. is not an investment in any of our funds. There can be no assurance that any of our funds or our other existing and future funds will achieve similar returns. The following tables reflect the performance of our significant funds in our Real Assets business. Please see “— Our Family of Funds” for a legend of the fund acronyms listed below.

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				TOTAL INVESTMENTS									REALIZED/PARTIALLY REALIZED INVESTMENTS(5)
				as of March 31, 2015									as of March 31, 2015
	Fund Inception Date(1)	Committed Capital		Cumulative Invested Capital(2)		Total Fair Value(3)		MOIC(4)	Gross IRR(7)		Net IRR(8)		Cumulative Invested Capital(2)		Total Fair Value(3)		MOIC(4)	Gross IRR(7)
Real Assets				(Reported in Local Currency, in Millions)									(Reported in Local Currency, in Millions)
Fully Invested Funds(6)
CRP III	11/2000	$	564.1	$	522.5	$	1,523.5	2.9x	44	%	30	%	$	522.5	$	1,523.5	2.9x	44	%
CRP IV	12/2004	$	950.0	$	1,198.7	$	1,568.9	1.3x	5	%	2	%	$	523.6	$	592.8	1.1x	7	%
CRP V	11/2006	$	3,000.0	$	3,290.4	$	4,977.6	1.5x	12	%	8	%	$	2,710.4	$	4,214.1	1.6x	14	%
CRP VI	9/2010	$	2,340.0	$	1,905.3	$	3,084.9	1.6x	34	%	23	%	$	618.8	$	1,193.0	1.9x	38	%
CEREP I	3/2002	€	426.6	€	517.0	€	691.3	1.3x	12	%	7	%	€	517.0	€	691.3	1.3x	12	%
CEREP II	4/2005	€	762.7	€	833.8	€	128.1	0.2x	(100%)		(100%)		€	594.1	€	130.5	0.2x	(100%)
CEREP III	5/2007	€	2,229.5	€	1,983.2	€	2,113.2	1.1x	2	%	(2	)%	€	718.3	€	1,189.9	1.7x	13	%
CIP	9/2006	$	1,143.7	$	1,011.7	$	1,243.2	1.2x	5	%	2	%	$	272.3	$	175.3	0.6x	(7%)
NGP X	1/2012	$	3,586.0	$	2,568.7	$	3,031.3	1.2x	10	%	7	%	$	325.9	$	734.7	2.3x	55	%
Energy II	7/2002	$	1,100.0	$	1,334.8	$	3,262.9	2.4x	81	%	55	%	$	827.4	$	3,138.8	3.8x	105	%
Energy III	10/2005	$	3,800.0	$	3,559.9	$	5,735.4	1.6x	11	%	8	%	$	1,945.4	$	4,718.3	2.4x	22	%
Energy IV	12/2007	$	5,979.1	$	5,830.0	$	8,271.9	1.4x	13	%	8	%	$	2,522.4	$	4,739.0	1.9x	28	%
Renew II	3/2008	3,417.5		$	3,018.8	$	4,194.0	1.4x	12	%	7	%	$	1,323.7	$	2,105.3	1.6x	16	%
All Other Funds(9)	Various			$	2,849.8	$	3,112.3	1.1x	4	%	(1	)%	$	2,170.6	$	2,306.9	1.1x	3	%
Coinvestments and Other(10)	Various			$	5,249.9	$	8,181.7	1.6x	17	%	13	%	$	2,575.0	$	5,354.2	2.1x	27	%
Total Fully Invested Funds				$	35,917.6	$	51,333.7	1.4x	13	%	8	%	$	18,300.5	$	32,954.1	1.8x	23	%
Funds in the Investment Period(6)
CRP VII (12)	3/2014	$	3,171.6	353.6		343.7		1.0x	n/m		n/m
CIEP I (12)	9/2013	$	2,500.0	$	345.5	$	324.4	0.9x	n/m		n/m
NGP XI (12)	6/2014	$	5,325.0	$	95.3	$	95.0	1.0x	n/m		n/m
All Other Funds(11)	Various			$	104.3	$	103.1	1.0x	n/m		n/m
Total Funds in the Investment Period				$	898.8	$	866.2	1.0x	(8	)%	(44	)%	$	—	$	—	n/a	n/a
TOTAL Real Assets(13)				$	36,816.4	$	52,200.0	1.4x	13	%	8	%	$	18,300.5	$	32,954.1	1.8x	23	%

(1) The data presented herein that provides "inception to date" performance results of our segments relates to the period following the formation of the first fund within each segment. For our Real Assets segment our first fund was formed in 1997.

(2) Represents the original cost of all capital called for investments since inception of the fund.

(3) Represents all realized proceeds combined with remaining fair value, before management fees, expenses and carried interest.

(4) Multiple of invested capital ("MOIC") represents total fair value, before management fees, expenses and carried interest, divided by cumulative invested capital.

(5) An investment is considered realized when the investment fund has completely exited, and ceases to own an interest in, the investment. An investment is considered partially realized when the total amount of proceeds received in respect of such investment, including dividends, interest or other distributions and/or return of capital, represents at least 85% of invested capital and such investment is not yet fully realized. Because part of our value creation strategy involves pursuing best exit alternatives, we believe information regarding Realized/Partially Realized MOIC and Gross IRR, when considered together with the other investment performance metrics presented, provides investors with meaningful information regarding our investment performance by removing the impact of investments where significant realization activity has not yet occurred. Realized/Partially Realized MOIC and Gross IRR have limitations as measures of investment performance, and should not be considered in isolation. Such limitations include the fact that these measures do not include the performance of earlier stage and other investments that do not satisfy the criteria provided above. The exclusion of such investments will have a positive impact on Realized/Partially Realized MOIC and Gross IRR in instances when the MOIC and Gross IRR in respect of such investments are less than the aggregate MOIC and Gross IRR. Our measurements of Realized/Partially Realized MOIC and Gross IRR may not be comparable to those of other companies that use similarly titled measures. We do not present Realized/Partially Realized performance information separately for funds that are still in the investment period because of the relatively insignificant level of realizations for funds of this type. However, to the extent such funds have had realizations, they are included in the Realized/Partially Realized performance information presented for Total Real Assets.

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(6) Fully Invested funds are past the expiration date of the investment period as defined in the respective limited partnership agreement. In instances where a successor fund has had its first capital call, the predecessor fund is categorized as fully invested.

(7) Gross Internal Rate of Return ("Gross IRR") represents the annualized IRR for the period indicated on Limited Partner invested capital based on contributions, distributions and unrealized value before management fees, expenses and carried interest.

(8) Net Internal Rate of Return ("Net IRR") represents the annualized IRR for the period indicated on Limited Partner invested capital based on contributions, distributions and unrealized value after management fees, expenses and carried interest.

(9) Aggregate includes the following funds: CRP I, CRP II, CAREP I, CAREP II, CRCP I, CPOCP, Energy I and Renew I.

(10) Includes co-investments, prefund investments and certain other stand-alone investments arranged by us.

(11) Aggregate includes the following funds: CPP II and NGP GAP. Returns are not considered meaningful, as the investment period commenced in June 2014 for CPP II and December 2013 for NGP GAP.

(12) Returns are not considered meaningful, as the investment period commenced in September 2013 for CIEP I, March 2014 for CRP VII, and June 2014 for NGP XI.

(13) For purposes of aggregation, funds that report in foreign currency have been converted to U.S. dollars at the reporting period spot rate.

	Remaining Fair Value(1)		Unrealized MOIC(2)	Total MOIC(3)	% Invested(4)		In Accrued Carry/ (Clawback) (5)	LTM Realized Carry (6)	Catch-up Rate		Fee Initiation Date(7)	Quarters Since Fee Initiation	Original Investment Period End Date
	As of March 31, 2015
Real Assets	(Reported in Local Currency, in Millions)
Energy IV	$	3,329.0	0.9x	1.4x	98	%	(X)	X	80	%	Feb-08	29	Dec-13
NGP X	$	2,667.5	1.2x	1.2x	72	%	X		80	%	Jan-12	13	May-17
Renew II	$	2,210.4	1.2x	1.4x	88	%	(X)		80	%	Mar-08	29	May-14
CRP VI	$	1,892.3	1.4x	1.6x	81	%	X	X	50	%	Mar-11	17	Mar-16
Energy III	$	1,244.1	0.6x	1.6x	94	%	(X)		80	%	Nov-05	38	Oct-11
CRP V	$	1,193.5	1.7x	1.5x	110	%	X		50	%	Nov-06	34	Nov-11
CEREP III	€	1,013.7	0.8x	1.1x	89	%			67	%	Jun-07	32	May-11
CRP IV	$	975.9	1.4x	1.3x	126	%			50	%	Jan-05	41	Dec-09
CIP	$	926.6	1.6x	1.2x	88	%			80	%	Oct-06	34	Sep-12
CRP III	$	368.7	60.1x	2.9x	93	%	X	X	50	%	Mar-01	57	May-05
CIEP I	$	365.0	0.9x	0.9x	14	%			80	%	Oct-13	6	Sep-19
CRP VII	$	336.0	1.0x	1.0x	11	%			80	%	Jun-14	4	Mar-19
Energy II	$	142.7	0.3x	2.4x	121	%	(X)		80	%	Jan-03	49	Jul-08
All Other Funds(8)	$	589.3	0.8x	0.9x			NM	NM
Coinvestment and Other(9)	$	3,107.1	1.3x	1.6x			NM	NM
Total Real Assets(10)	$	20,435.3	1.1x	1.4x

(1) Net asset value of our carry funds. Reflects significant funds with remaining fair value of greater than $100 million.

(2) Unrealized multiple of invested capital (“MOIC”) represents remaining fair market value, before management fees, expenses and carried interest, divided by investment cost.

(3) Total MOIC represents total fair value before management fees, expenses, and carried interest, divided by cumulative invested capital.

(4) Represents cumulative equity invested as of the reporting period divided by total commitments. Amount can be greater than 100% due to the re-investment of recallable distributions to fund investors.

(5) Fund has accrued carry/(clawback) as of the reporting period.

(6) Fund has realized carry in the last twelve months.

(7) Represents the date of the first capital contribution for management fees.

(8) Aggregate includes the following funds: CRP I, CRP II, CRCP I, CEREP I, CEREP II, CAREP I, CAREP II, CPOCP I, CPP II, NGP XI, NGP GAP, Energy I and Renew I. In Accrued Carry/(Clawback) and LTM Realized Carry not indicated because the indicator does not apply to each fund within the aggregate.

(9) Includes co-investments, prefund investments and certain other stand-alone investments arranged by us. In Accrued Carry/(Clawback) and LTM Realized Carry not indicated because the indicator does not apply to each fund within the aggregate.

(10) For purposes of aggregation, funds that report in foreign currency have been converted to U.S. dollars at the reporting period spot rate.

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Investment Solutions

As a result of our acquisition of DGAM on February 3, 2014, our segment results include the results of operations of DGAM since the acquisition date.

The following table presents our results of operations for our Investment Solutions segment:

	Three Months Ended March 31,
	2015		2014
	(Dollars in millions)
Segment Revenues
Fund level fee revenues
Fund management fees	$	40.5	$	44.5
Portfolio advisory fees, net	—		—
Transaction fees, net	—		—
Total fund level fee revenues	40.5		44.5
Performance fees
Realized	3.4		5.9
Unrealized	47.0		79.3
Total performance fees	50.4		85.2
Investment income
Realized	0.1		—
Unrealized	0.6		0.1
Total investment income	0.7		0.1
Interest and other income	0.4		0.3
Total revenues	92.0		130.1
Segment Expenses
Compensation and benefits
Direct base compensation	21.5		21.0
Indirect base compensation	3.6		3.8
Equity-based compensation	2.7		0.7
Performance fee related
Realized	2.2		4.0
Unrealized	44.3		75.7
Total compensation and benefits	74.3		105.2
General, administrative, and other indirect expenses	7.9		9.2
Depreciation and amortization expense	0.8		0.9
Interest expense	1.5		1.2
Total expenses	84.5		116.5
Economic Net Income	$	7.5	$	13.6
(-) Net Performance Fees	3.9		5.5
(-) Investment Income	0.7		0.1
(+) Equity-based Compensation	2.7		0.7
(=) Fee Related Earnings	$	5.6	$	8.7
(+) Realized Net Performance Fees	1.2		1.9
(+) Realized Investment Income	0.1		—
(=) Distributable Earnings	$	6.9	$	10.6

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Three Months Ended March 31, 2015 Compared to the Three Months Ended March 31, 2014

Total fee revenues were $40.5 million and $44.5 million for the three months ended March 31, 2015 and 2014, respectively. The decrease was due primarily to the decline in the Euro exchange rate in 2015 as compared to 2014. The decrease attributable to exchange rate fluctuations was partially offset by $1.1 million of increased management fees from DGAM for the three months ended March 31, 2015 as compared to 2014.

Total compensation and benefits were $74.3 million and $105.2 million for the three months ended March 31, 2015 and 2014, respectively. Performance fee related compensation expense was $46.5 million and $79.7 million or 92% and 94% of performance fees for the three months ended March 31, 2015 and 2014, respectively.

Direct and indirect base compensation expense was $25.1 million and $24.8 million for the three months ended March 31, 2015 and 2014, respectively.

Equity-based compensation was $2.7 million and $0.7 million for the three months ended March 31, 2015 and 2014, respectively. The increase is due primarily to the ongoing granting of deferred restricted common units to new and existing employees during 2014 and 2015 and a decrease in the estimated forfeiture rates during the three months ended March 31, 2015.

General, administrative and other indirect expenses were $7.9 million and $9.2 million for the three months ended March 31, 2015 and 2014, respectively. The decrease was due primarily to gains on our foreign currency hedging activities.

Depreciation and amortization expense was $0.8 million and $0.9 million for the three months ended March 31, 2015 and 2014, respectively.

Interest expense was $1.5 million and $1.2 million for the three months ended March 31, 2015 and 2014, respectively. The increase was due primarily to the allocated interest on $200 million of 5.625% senior notes due 2043 issued in March 2014.

Economic Net Income. Economic net income was $7.5 million and $13.6 million for the three months ended March 31, 2015 and 2014, respectively. The decrease in ENI for the three months ended March 31, 2015 as compared to 2014 was primarily driven by a decrease in fee related earnings of $3.1 million, an increase in equity-based compensation expense of $2.0 million, and a decrease in net performance fees of $1.6 million.

Fee Related Earnings. Fee related earnings were $5.6 million and $8.7 million for the three months ended March 31, 2015 and 2014, respectively. The decrease in fee related earnings was primarily due to a decrease in fee revenues of $4.0 million.

Performance Fees. Under our arrangements with the historical owners and management team of AlpInvest, we generally do not retain any carried interest in respect of the historical investments and commitments to our fund of funds vehicles that existed as of July 1, 2011 (including any options to increase any such commitments exercised after such date). We are entitled to 15% of the carried interest in respect of commitments from the historical owners of AlpInvest for the period between 2011 and 2020 and 40% of the carried interest in respect of all other commitments (including all future commitments from third parties).

Performance fees were $50.4 million and $85.2 million for the three months ended March 31, 2015 and 2014, respectively. Performance fees for three months ended March 31, 2015 and 2014 are inclusive of approximately $0.8 million and $1.2 million of performance fee reversals. Performance fees for this segment by type of fund are as follows:

	Three Months Ended March 31,
	2015		2014
	(Dollars in millions)
Private Equity fund of funds	$	50.2	$	82.4
Hedge fund of funds	0.2		2.8
Performance fees	$	50.4	$	85.2

The $50.4 million in performance fees for the three months ended March 31, 2015 was driven primarily by performance fees for the Co-Investment Fund & Secondaries Fund (2012-2013) of $18.4 million, the Co-Investment Fund & Secondaries Fund (2009-2010) of $9.3 million, and the Co-Investment Fund & Secondaries Fund (2011-2013) of $5.7 million. Performance fees for the three months ended March 31, 2015 and 2014 were primarily due to the overall appreciation in the investments in

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the AlpInvest fund of funds vehicles of approximately 14% and 7% for the three months ended March 31, 2015 and 2014, respectively.

Net performance fees for the three months ended March 31, 2015 were $3.9 million, representing a decrease of $1.6 million from $5.5 million in net performance fees for the three months ended March 31, 2014.

Distributable Earnings. Distributable earnings were $6.9 million and $10.6 million for the three months ended March 31, 2015 and 2014, respectively. The decrease in distributable earnings was due to the decrease in fee related earnings of $3.1 million and the decrease in realized net performance fees of $0.7 million.

Fee-earning AUM as of and for the Three Ended March 31, 2015 and 2014

Fee-earning AUM is presented below for each period together with the components of change during each respective period.

	As of March 31,
	2015		2014
Investment Solutions	(Dollars in millions)
Components of Fee-earning AUM (1)
Fee-earning AUM based on capital commitments	$	9,894	$	10,473
Fee-earning AUM based on invested capital (2)	1,142		1,085
Fee-earning AUM based on net asset value	2,061		2,925
Fee-earning AUM based on lower of cost or fair market value	17,375		22,985
Total Fee-earning AUM	$	30,472	$	37,468

(1) For additional information concerning the components of Fee-earning AUM, see “—Fee-earning Assets under Management.”

(2) Includes amounts committed to or reserved for certain Metropolitan fund of funds vehicles.

The table below breaks out Fee-earning AUM by its respective components during the period.

	Three Months Ended March 31,
	2015			2014
Investment Solutions	(Dollars in millions)
Fee-earning AUM Rollforward
Balance, Beginning of Period	$	33,082		$	35,067
Acquisitions	—			2,894
Inflows, including Fee-paying Commitments (1)	2,170			700
Outflows, including Distributions (2)	(1,684		)	(1,077		)
Subscriptions, net of Redemptions (3)	(11		)	(28		)
Market Appreciation/(Depreciation) (4)	66			(34		)
Foreign Exchange and other (5)	(3,151		)	(54		)
Balance, End of Period	$	30,472		$	37,468

(1) Inflows represent mandates where commitment fee period was activated and capital invested by fund of funds vehicles outside the commitment fee period or weighted-average investment period.

(2) Outflows represent distributions from fund of funds vehicles outside the commitment fee period or weighted-average investment period and changes in fee basis for fund of funds vehicles where the commitment fee period or weighted-average investment period has expired.

(3) Represents subscriptions and redemptions in our fund of hedge funds vehicles.

(4) Market Appreciation/(Depreciation) represents changes in the net asset value of our fund of hedge funds vehicles and realized and unrealized gains (losses) on our fund of funds vehicles based on the lower of cost or fair value.

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(5) Represents the impact of foreign exchange rate fluctuations on the translation of our non-U.S. dollar denominated funds. Activity during the period is translated at the average rate for the period. Ending balances are translated at the spot rate as of the period end.

Fee-earning AUM was $30.5 billion at March 31, 2015, a decrease of $2.6 billion, or approximately 8%, compared to $33.1 billion at December 31, 2014. This was driven by a foreign exchange decrease of $3.2 billion on our Euro-denominated fund of funds vehicles and outflows of $1.7 billion, primarily in our AlpInvest fund of funds vehicles. This was offset by inflows of $2.2 billion in our AlpInvest fund of funds vehicles. Distributions from funds still in the commitment or weighted-average investment period do not impact Fee-earning AUM as these funds are based on commitments and not invested capital. Increases in fair value have an impact on Fee-earning AUM for Investment Solutions as fully committed funds are based on the lower of cost or fair value of the underlying investments.

Fee-earning AUM was $30.5 billion at March 31, 2015, a decrease of $7.0 billion, or approximately 19%, compared to $37.5 billion at March 31, 2014. This decrease was driven by foreign exchange decrease of $7.0 billion in our Euro-denominated AlpInvest fund of funds vehicles, outflows of $6.9 billion, due to $4.6 billion in dispositions and $2.3 billion for reductions in fee basis from commitments to lower of cost or fair value, both primarily in our AlpInvest fund of funds vehicles, and net redemptions of $1.0 billion in our fund of hedge fund vehicles. This was partially offset by inflows of $7.4 billion and market appreciation of $0.5 billion.

Fee-earning AUM was $37.5 billion at March 31, 2014, an increase of $2.4 billion, or approximately 7%, compared to $35.1 billion at December 31, 2013. The increase was driven by the acquisition of DGAM for $2.9 billion and $0.7 billion of inflows in our AlpInvest fund of funds vehicles primarily for investments made by vehicles outside of the commitment fee period. This increase was partially offset by outflows of $1.1 billion, which also were primarily driven by our Alpinvest fund of funds vehicles outside of the commitment fee period, and net redemptions in DGAM’s fund of hedge funds vehicles.

Total AUM as of and for the Three Month Period Ended March 31, 2015

The table below provides the period to period rollforwards of Available Capital and Fair Value of Capital, and the resulting rollforward of Total AUM.

	Three Months Ended March 31, 2015
	Available Capital			Fair Value of Capital			Total AUM
	(Dollars in millions)
Investment Solutions
Balance, Beginning of Period	$	16,206		$	34,563		$	50,769
Acquisitions	—			—			—
Commitments (1)	1,944			—			1,944
Capital Called, net (2)	(1,362		)	1,263			(99		)
Distributions (3)	54			(2,885		)	(2,831		)
Subscriptions, net of Redemptions (4)	—			(5		)	(5		)
Market Appreciation/(Depreciation) (5)	—			4,016			4,016
Foreign Exchange and other (6)	(750		)	(3,626		)	(4,376		)
Balance, End of Period	$	16,092		$	33,326		$	49,418

(1) Represents capital raised by our fund of funds vehicles, including activation of new mandates, net of expired available capital.

(2) Represents capital called by our fund of funds vehicles, net of fund fees and expenses.

(3) Represents distributions from our fund of funds vehicles, net of amounts recycled.

(4) Represents the net result of subscriptions to and redemptions from our fund of hedge funds vehicles.

(5) Market Appreciation/(Depreciation) represents changes in the net asset value of our fund of hedge funds vehicles and realized and unrealized gains (losses) on fund investments, secondary investments, co-investments, and real estate fund of funds vehicles. Fair market values for fund of funds vehicles are based on the latest available valuations of the underlying limited partnership interests (in most cases as of December 31, 2014) as provided by their general partners, plus the net cash flows since the latest valuation, up to March 31, 2015.

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(6) Represents the impact of foreign exchange rate fluctuations on the translation of our non-U.S. dollar denominated funds. Activity during the period is translated at the average rate for the period. Ending balances are translated at the spot rate as of the period end.

Total AUM was $49.4 billion at March 31, 2015, a decrease of $1.4 billion, or approximately 3%, compared to $50.8 billion at December 31, 2014. This decrease was primarily driven by foreign exchange of $4.4 billion in our Euro-denominated fund of funds vehicles and $2.8 billion of distributions, primarily in our AlpInvest fund of funds vehicles. This decrease was offset by market appreciation of $4.0 billion and net capital calls of $1.9 billion.

Fund Performance Metrics

Fund performance information for our AlpInvest funds that have at least $1.0 billion in capital commitments, cumulative equity invested or total value as of March 31, 2015, which we refer to as our “significant funds” is included throughout this discussion and analysis to facilitate an understanding of our results of operations for the periods presented. The fund return information reflected in this discussion and analysis is not indicative of the performance of The Carlyle Group L.P. and is also not necessarily indicative of the future performance of any particular fund. An investment in The Carlyle Group L.P. is not an investment in any of our funds. There can be no assurance that any of our funds or our other existing and future funds will achieve similar returns.

The following tables reflect the performance of our significant funds in our Investment Solutions business.

				TOTAL INVESTMENTS
				as of March 31, 2015
	Vintage Year	Fund Size		Cumulative Invested Capital (2)(8)		Total Fair Value (3)(8)		MOIC (4)	Gross  IRR (6)		Net IRR (7)
Investment Solutions (1)	(Reported in Local Currency, in Millions)
Fully Committed Funds (5)
Main Fund I - Fund Investments	2000	€	5,174.6	€	4,469.6	€	7,305.0	1.6x	12	%	12	%
Main Fund II - Fund Investments	2003	€	4,545.0	€	5,076.2	€	7,817.0	1.5x	10	%	9	%
Main Fund III - Fund Investments	2005	€	11,500.0	€	12,920.6	€	18,821.5	1.5x	10	%	9	%
Main Fund IV - Fund Investments	2009	€	4,877.3	€	3,597.9	€	4,590.1	1.3x	14	%	13	%
Main Fund I - Secondary Investments	2002	€	519.4	€	521.0	€	984.1	1.9x	58	%	54	%
Main Fund II - Secondary Investments	2003	€	998.4	€	1,061.6	€	1,936.2	1.8x	27	%	26	%
Main Fund III - Secondary Investments	2006	€	2,250.0	€	2,474.2	€	3,502.7	1.4x	10	%	9	%
Main Fund IV - Secondary Investments	2010	€	1,859.1	€	1,958.9	€	2,991.6	1.5x	20	%	19	%
Main Fund II - Co-Investments	2003	€	1,090.0	€	970.3	€	2,627.3	2.7x	43	%	41	%
Main Fund III - Co-Investments	2006	€	2,760.0	€	3,007.7	€	4,067.8	1.4x	5	%	5	%
Main Fund IV - Co-Investments	2010	€	1,475.0	€	1,419.2	€	2,886.9	2.0x	24	%	22	%
Main Fund V - Co-Investments	2012	€	1,122.2	€	1,041.7	€	1,719.5	1.7x	47	%	42	%
Main Fund II - Mezzanine Investments	2004	€	700.0	€	805.9	€	1,105.9	1.4x	8	%	7	%
Main Fund III - Mezzanine Investments	2006	€	2,000.0	€	1,887.0	€	2,506.3	1.3x	11	%	9	%
All Other Funds (9)	Various			€	1,925.1	€	2,679.2	1.4x	16	%	13	%
Total Fully Committed Funds				€	43,137.0	€	65,541.0	1.5x	12	%	12	%
Funds in the Commitment Period (5)
Main Fund V - Fund Investments	2012	€	5,080.0	€	1,301.9	€	1,270.7	1.0x	(3	)%	(6	)%
Main Fund V - Secondary Investments	2011	€	4,078.3	€	2,287.5	€	3,050.8	1.3x	28	%	25	%
Main Fund VI - Co-Investments	2014	€	990.0	€	117.7	€	117.3	1.0x	(1	)%	(11	)%
All Other Funds (9)	Various			€	75.5	€	77.4	1.0x	5	%	(5	)%
Total Funds in the Commitment Period				€	3,782.7	€	4,516.2	1.2x	20	%	16	%
TOTAL INVESTMENT SOLUTIONS				€	46,919.7	€	70,057.2	1.5x	13	%	12	%
TOTAL INVESTMENT SOLUTIONS (USD)(10)				$	50,337.6	$	75,160.6	1.5x

(1) Includes private equity and mezzanine primary fund investments, secondary fund investments and co-investments originated by the AlpInvest team. Excluded from the performance information shown are a) investments that were not originated by AlpInvest, b) Direct Investments, which was spun off from AlpInvest in 2005, and c) Metropolitan Real Estate fund of funds vehicles. As of March 31, 2015, these excluded investments represent $0.6 billion of AUM at AlpInvest and $1.8 billion of AUM at Metropolitan.

(2) Represents the original cost of all capital called for investments since inception of the fund.

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(3) Represents all realized proceeds combined with remaining fair value, before management fees, expenses and carried interest.

(4) Multiple of invested capital (“MOIC”) represents total fair value, before management fees, expenses and carried interest, divided by cumulative invested capital.

(5) Fully Committed funds are past the expiration date of the commitment period as defined in the respective limited partnership agreement.

(6) Gross Internal Rate of Return (“Gross IRR”) represents the annualized IRR for the period indicated on Limited Partner invested capital based on contributions, distributions and unrealized value before management fees, expenses and carried interest.

(7) Net Internal Rate of Return (“Net IRR”) represents the annualized IRR for the period indicated on Limited Partner invested capital based on contributions, distributions and unrealized value after management fees, expenses and carried interest.

(8) To exclude the impact of FX, all foreign currency cash flows have been converted to Euro at the reporting period spot rate.

(9) Aggregate includes Main Fund I - Co-Investments, Main Fund I - Mezzanine Investments, Main Fund IV - Mezzanine Investments, Main Fund V - Mezzanine Investments, Main Fund VI - Fund Investments, AlpInvest CleanTech Funds and funds which are not included as part of a main fund.

(10) Represents the U.S. dollar equivalent balance translated at the spot rate as of period end.

Liquidity and Capital Resources

Historical Liquidity and Capital Resources

We have historically required limited capital resources to support the working capital and operating needs of our business. Our management fees have largely covered our operating costs and we have distributed all realized performance fees after related compensation to equityholders. Historically, approximately 95% of all capital commitments to our funds have been provided by our fund investors, with the remaining amount typically funded by our senior Carlyle professionals, operating executives and other professionals.

Cash Flows

The significant captions and amounts from our consolidated statements of cash flows which include the effects of our Consolidated Funds and CLOs in accordance with U.S. GAAP are summarized below.

	Three Months Ended March 31,
	2015			2014
	(Dollars in millions)
Statements of Cash Flows Data
Net cash provided by operating activities	$	1,475.0		$	989.8
Net cash provided by investing activities	0.9			77.7
Net cash used in financing activities	(1,607.0		)	(997.8		)
Effect of foreign exchange rate changes	(86.1		)	(2.0		)
Net change in cash and cash equivalents	$	(217.2	)	$	67.7

Net Cash Provided by Operating Activities. Net cash provided by operating activities is primarily driven by our earnings in the respective periods after adjusting for non-cash performance fees, the related non-cash performance fee related compensation, and non-cash equity-based compensation, all of which are included in earnings. Cash used to purchase investments and trading securities as well as the proceeds from the sale of such investments are also reflected in our operating activities as investments are a normal part of our operating activities. Over time investment proceeds may be greater than investment purchases.

During the three months ended March 31, 2015, investment proceeds were $271.4 million while investment purchases were $20.1 million. During the three months ended March 31, 2014, investment proceeds were $390.8 million as compared to purchases of $12.0 million. Also included in our net cash provided by operating activities are proceeds from sales of investments by the Consolidated Funds, offset by purchases of investments by the Consolidated Funds. For the three months ended March 31, 2015, proceeds from the sales and settlements of investments by the Consolidated Funds were $1,992.4 million, while purchases of investments by the Consolidated Funds were $2,139.0 million. For the three months ended March 31, 2014, proceeds from the sales and settlements of investments by the Consolidated Funds were $2,801.2 million, while purchases of investments by the Consolidated Funds were $2,418.6 million.

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Net Cash Provided By Investing Activities. Our investing activities generally reflect cash used for acquisitions, fixed assets and software for internal use, and changes in restricted cash. For the three months ended March 31, 2015, cash provided by investing activities primarily reflects a change in restricted cash balances and purchases of fixed assets. Additionally, the acquisition of DGAM resulted in the use of cash, net of cash acquired, of $3.1 million during the three months ended March 31, 2014.

Net Cash Used in Financing Activities. Financing activities are a net use of cash in each of the historical periods presented. In March 2014, the Partnership received net proceeds from the issuance of 13,800,000 newly issued common units of $449.5 million. The Partnership used $303.4 million of these proceeds to acquire 9,300,000 Carlyle Holdings partnership units from the other limited partners of the Carlyle Holdings partnerships. The remaining net proceeds were used by the Partnership to acquire 4,500,000 newly issued Carlyle Holdings partnership units. Carlyle Holdings is using the proceeds from the issuance of the 4,500,000 Carlyle Holdings partnership units for general corporate purposes, including investments in our funds as well as investment capital for acquisitions of new fund platforms and strategies or other growth initiatives, to drive innovation across the broader Carlyle platform. Also during March 2014, we received net proceeds of $210.8 million, net of financing costs, from the issuance of $200.0 million of 5.625% senior notes due 2043 at 104.315% of par. The net proceeds from this issuance is being used for general corporate purposes, including investments in our funds as well as investment capital for acquisitions of new fund platforms and strategies and other growth initiatives.

Distributions to our common unitholders were $110.9 million and $70.4 million for the three months ended March 31, 2015 and 2014, respectively. Distributions to the non-controlling interest holders in Carlyle Holdings were $403.6 million and $366.5 million for the three months ended March 31, 2015 and 2014, respectively. The net borrowings (payments) on loans payable by our Consolidated Funds during the three months ended March 31, 2015 and 2014 were $402.2 million and $(323.2) million, respectively. For the three months ended March 31, 2015 and 2014, contributions from non-controlling interest holders were $752.2 million and $753.3 million, respectively, which relate primarily to contributions from the non-controlling interest holders in Consolidated Funds. For the three months ended March 31, 2015 and 2014, distributions to non-controlling interest holders were $1,268.4 million and $1,256.9 million, respectively, which relate primarily to distributions to the non-controlling interest holders in Consolidated Funds.

Our Sources of Cash and Liquidity Needs

In the future, we expect that our primary liquidity needs will be to:

• provide capital to facilitate the growth of our existing business lines;

• provide capital to facilitate our expansion into new, complementary business lines, including acquisitions;

• pay operating expenses, including compensation and compliance costs and other obligations as they arise;

• fund capital expenditures;

• repay borrowings and related interest costs and expenses;

• pay earnouts and contingent cash consideration associated with our acquisitions and strategic investments;

• pay income taxes;

• make distributions to our unitholders and the holders of the Carlyle Holdings partnership units in accordance with our distribution policy; and

• fund the capital investments of Carlyle in our funds.

With respect to distribution year 2015, the Board of Directors of our general partner has declared a distribution to common unitholders totaling approximately $23.6 million, or $0.33 per common unit in respect of the first quarter of 2015, to common unitholders of record on May 15, 2015, which is payable on May 22, 2015.

With respect to distribution year 2014, we paid a distribution of approximately $10.7 million to common unitholders in May 2014 in respect of the first quarter of 2014.

Distributions to common unitholders paid during the three months ended March 31, 2015 totaled $110.9 million, representing the amount paid in March 2015 of $1.61 per common unit with respect to the fourth quarter of 2014. Distributions

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to common unitholders paid during the three months ended March 31, 2014 totaled $70.4 million, representing the amount paid in March 2014 of $1.40 per common unit with respect to the fourth quarter of 2013.

It is Carlyle's intention to cause Carlyle Holdings to make quarterly distributions to its partners, including The Carlyle Group L.P.’s wholly owned subsidiaries, that will enable The Carlyle Group L.P. to pay a quarterly distribution of approximately 75% of Distributable Earnings per common unit, net of taxes and amounts payable under the tax receivable agreement, for the quarter. Carlyle’s general partner may adjust the distribution for amounts determined to be necessary or appropriate to provide for the conduct of its business, to make appropriate investments in its business and its funds or to comply with applicable law or any of its financing agreements, or to provide for future cash requirements such as tax-related payments, clawback obligations and distributions to unitholders for any ensuing quarter. The amount to be distributed could also be adjusted upward in any one quarter.

Distributions for the 2014 and prior years, including the fourth quarter distribution, were determined in accordance with Carlyle’s distribution policy in effect for those years. For those periods, Carlyle Holdings made quarterly distributions to its partners, including The Carlyle Group L.P.'s wholly owned subsidiaries, that enabled The Carlyle Group L.P. to pay a quarterly distribution of $0.16 per common unit for each of the first three quarters of each year and for the fourth quarter of each year, to pay a distribution of at least $0.16 per common unit that, taken together with the prior quarterly distributions in respect of that year, represented its share, net of taxes and amounts payable under the tax receivable agreement, of Carlyle's Distributable Earnings in excess of the amount determined by Carlyle's general partner that was necessary or appropriate to provide for the conduct of Carlyle's business, to make appropriate investments in its business and its funds or to comply with applicable law or any of its financing agreements. The aggregate amount of our distributions for those years were less than our Distributable Earnings for that year due to these funding requirements.

Notwithstanding the foregoing, the declaration and payment of any distributions will be at the sole discretion of our general partner, which may change our distribution policy at any time. Our general partner will take into account general economic and business conditions, our strategic plans and prospects, our business and investment opportunities, our financial condition and operating results, working capital requirements and anticipated cash needs, contractual restrictions and obligations, legal, tax and regulatory restrictions, other constraints on the payment of distributions by us to our common unitholders or by our subsidiaries to us, and such other factors as our general partner may deem relevant.

Generally, we intend to have Carlyle commit to fund approximately 1% of the capital commitments to our future carry funds, although we may elect to invest additional amounts in funds focused on new investment areas. We may, from time to time, exercise our right to purchase additional interests in our investment funds that become available in the ordinary course of their operations. We expect our senior Carlyle professionals and employees to continue to make significant capital contributions to our funds based on their existing commitments, and to make capital commitments to future funds consistent with the level of their historical commitments. We also intend to make investments in our open-end funds and our CLO vehicles.

We generally use our working capital and cash flows to invest in growth initiatives, service our debt, fund the working capital needs of our business and investment funds and pay distributions to our unitholders. We have multiple sources of liquidity to meet our capital needs, including cash on hand, annual cash flows, accumulated earnings and funds from our senior credit facility, including a term loan facility and a revolving credit facility with $750.0 million available as of March 31, 2015. We believe these sources will be sufficient to fund our capital needs for at least the next 12 months. If we determine that market conditions are favorable after taking into account our liquidity requirements, including the amounts available under our senior credit facility, we may seek to issue and sell common units in a registered public offering or to issue additional senior notes or other debt. For example, during the first quarter of 2014, we issued 13,800,000 common units in a registered public offering that provided net proceeds to us of $449.5 million. We also issued $200 million of 5.625% senior notes due 2043 during the first quarter of 2014 that provided net proceeds to us of $210.8 million. We used a portion of the net proceeds from the equity issuance to purchase from certain holders, including certain of our directors and executive officers, an equivalent number of outstanding Carlyle Holdings partnership units. The remaining proceeds from the equity issuance and the proceeds from the debt issuance is being used for general corporate purposes, investments in our funds as well as investment capital for acquisitions of new fund platforms and strategies or other growth initiatives, to drive innovation across the broader Carlyle platform.

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Since our inception through March 31, 2015, we and our senior Carlyle professionals, operating executives and other professionals have invested or committed to invest in or alongside our funds. Approximately 5% of all capital commitments to our funds are funded collectively by us and our senior Carlyle professionals, operating executives and other professionals. The current invested capital and unfunded commitment of Carlyle and our senior Carlyle professionals, operating executives and other professionals to our investment funds as of March 31, 2015, consisted of the following:

Asset Class	Current Equity Invested		Unfunded Commitment		Total Current Equity Invested and Unfunded Commitment
	(Dollars in millions)
Corporate Private Equity	$	1,519.4	$	2,013.1	$	3,532.5
Global Market Strategies	1,102.9		364.4		1,467.3
Real Assets	820.5		732.9		1,553.4
Investment Solutions	118.7		36.9		155.6
Total	$	3,561.5	$	3,147.3	$	6,708.8

A substantial majority of these investments have been funded by, and a substantial majority of the remaining commitments are expected to be funded by, senior Carlyle professionals, operating executives and other professionals through our internal co-investment program. Of the $3.1 billion of unfunded commitments, approximately $2.8 billion is subscribed individually by senior Carlyle professionals, operating executives and other professionals, with the balance funded directly by the Partnership.

Investments as of March 31, 2015 consist of the following (dollars in millions):

Investments	$	944.2
Less: Amounts attributable to non-controlling interests in consolidated entities	(251.1		)
Less: Strategic equity method investment in NGP Management	(493.6		)
Less: Investment in the general partner of NGP X associated with carried interest    rights	(3.9		)
Investments excluding non-controlling interests and NGP	195.6
Plus: investments in Consolidated Funds, eliminated in consolidation	175.1
Total investments attributable to Carlyle Holdings, exclusive of NGP management	$	370.7

Another source of liquidity we may use to meet our capital needs is the realized carried interest and incentive fee revenue generated by our investment funds. Carried interest is realized when an underlying investment is profitably disposed of and the fund’s cumulative returns are in excess of the preferred return. Incentive fees earned on hedge fund structures are realized at the end of each fund’s measurement period. Incentive fees earned on our CLO vehicles are paid upon the dissolution of such vehicles.

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Our accrued performance fees by segment as of March 31, 2015, gross and net of accrued giveback obligations, are set forth below:

Asset Class	Accrued Performance Fees		Accrued Giveback Obligation			Net Accrued Performance Fees
	(Dollars in millions)
Corporate Private Equity	$	2,857.3	$	(52.4	)	$	2,804.9
Global Market Strategies	147.1		—			147.1
Real Assets	321.7		(124.2		)	197.5
Investment Solutions	441.1		—			441.1
Total	$	3,767.2	$	(176.6	)	$	3,590.6
Plus: Investment in the general partner of NGP X associated with carried interest rights						3.9
Less: Accrued performance fee-related compensation						(1,809.9		)
Plus: Receivable for giveback obligations from current and former employees						28.4
Less: Deferred taxes on accrued performance fees						(80.7		)
Less: Net accrued performance fees attributable to non-controlling interests in consolidated entities						71.7
Net accrued performance fees excluding compensation and non-controlling interests						1,804.0
Plus: Net accrued performance fees in Consolidated Funds, eliminated in consolidation						5.0
Less: Net accrued performance fees realized in the first quarter of 2015 and to be collected in subsequent periods						(18.8		)
Net accrued performance fees attributable to Carlyle Holdings, excluding realized amounts						$	1,790.2

As of March 31, 2015, the net accrued performance fees attributable to Carlyle Holdings, excluding realized amounts, related to our carry funds and our other vehicles by segment were as follows (dollars in millions):

Carry fund-related
Corporate Private Equity:
Buyout	$	1,462.3
Growth Capital	70.9
Total Corporate Private Equity	1,533.2
Real Assets:
Real Estate	155.4
Natural Resources	17.8
Legacy Energy	(27.4		)
Total Real Assets	145.8
Global Market Strategies	79.8
Investment Solutions and other non-carry funds	31.4
Net accrued performance fees attributable to Carlyle Holdings	$	1,790.2

Cash and cash equivalents were approximately $1.0 billion at March 31, 2015. However, a portion of this cash is allocated for specific business purposes, including, but not limited to, (i) performance fee-related cash that has been received but not yet distributed as performance fee-related compensation and amounts owed to non-controlling interests; (ii) proceeds received from realized investments that are allocable to non-controlling interests; and (iii) regulatory capital. After deducting cash amounts allocated to these specific requirements, the remaining cash and cash equivalents is approximately $840 million as of March 31, 2015. This remaining amount will be used towards our primary liquidity needs, as previously outlined. This amount does not take into consideration ordinary course of business payables and reserves for specific business purposes, including, but not limited to, giveback obligations.

Our Balance Sheet and Indebtedness

Total assets were $35.0 billion at March 31, 2015, a decrease of $1.0 billion from December 31, 2014. The decrease in total assets was primarily attributable to decreases in due from affiliates and other receivables of Consolidated Funds, net, cash

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and cash equivalents, and cash and cash equivalents held at Consolidated Funds. Assets of the Consolidated Funds were approximately $28.1 billion at March 31, 2015, representing a decrease of $0.7 billion from December 31, 2014. Cash and cash equivalents were approximately $1.0 billion, a decrease of $0.2 billion from December 31, 2014.

Total liabilities were $22.9 billion at March 31, 2015, a decrease of $0.2 billion from December 31, 2014. The decrease in liabilities was primarily attributable to decreases in the liabilities of the Consolidated Funds, which decreased $0.3 billion from December 31, 2014 to March 31, 2015.

The assets and liabilities of the Consolidated Funds are generally held within separate legal entities and, as a result, the assets of the Consolidated Funds are not available to meet our liquidity requirements and similarly the liabilities of the Consolidated Funds are non-recourse to us. The assets and liabilities of the consolidated real estate VIE are also held in separate legal entities; we have not guaranteed or assumed any obligation for repayment of its liabilities nor are its assets available to meet our liquidity requirements.

Our balance sheet without the effect of the Consolidated Funds can be seen in Note 20 to the unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q. At March 31, 2015, our total assets were $7.1 billion, including cash and cash equivalents of $1.0 billion and accrued performance fees of $3.8 billion.

Loans Payable. Loans payable on our balance sheet at March 31, 2015 reflects $25.0 million outstanding under our senior credit facility, comprised of $25.0 million of term loan balance outstanding. No amount was outstanding under the revolving credit facility of our senior credit facility. Additionally, loans payable at March 31, 2015 includes $13.4 million outstanding under a separate term loan entered into during 2013 related to an investment in a CLO.

Senior Credit Facility. As of March 31, 2015, the senior credit facility included $25.0 million in a term loan and $750.0 million in a revolving credit facility. As of March 31, 2015, the term loan and revolving credit facility were scheduled to mature on August 9, 2018; however, they were amended as described below on May 5, 2015. Principal amounts outstanding under the amended term loan and revolving credit facility accrue interest, at the option of the borrowers, either (a) at an alternate base rate plus an applicable margin not to exceed 0.75%, or (b) at LIBOR plus an applicable margin not to exceed 1.75% (1.43% at March 31, 2015).

The senior credit facility is unsecured. We are required to maintain management fee earning assets (as defined in the senior credit facility) of at least $65 billion plus 70% of any future acquired AUM and a total debt leverage ratio of less than 3.0 to 1.0, in each case, tested on a quarterly basis. Non-compliance with any of the financial or non-financial covenants without cure or waiver would constitute an event of default under the senior credit facility. An event of default resulting from a breach of certain financial or non-financial covenants may result, at the option of the lenders, in an acceleration of the principal and interest outstanding, and a termination of the revolving credit facility. The senior credit facility also contains other customary events of default, including defaults based on events of bankruptcy and insolvency, nonpayment of principal, interest or fees when due, breach of specified covenants, change in control and material inaccuracy of representations and warranties.

On May 5, 2015, the Partnership entered into Amendment No. 2 to the senior credit facility, which: (i) extends the maturity date of the term loan and revolving credit facility from August 9, 2018 to May 5, 2020, (ii) revises the management fee earning assets covenant to remove the step up requirement to add 70% of future acquired AUM and to set the minimum management fee earning assets amount at $65.3 billion, (iii) changes the definition of Indebtedness to provide for a deduction of unrestricted cash, and (iv) reduces the corporate ratings-based pricing grid.

Other Term Loan. On October 3, 2013, the Partnership borrowed €12.6 million ($13.4 million at March 31, 2015) under a new term loan and security agreement with a financial institution. Interest on the term loan accrues at EURIBOR plus 1.75% (1.77% at March 31, 2015). The Partnership may prepay the facility in whole or in part at any time without penalty. The facility is scheduled to mature on the earlier of five years after closing or the date that the CLO is dissolved. The facility is secured by the Partnership’s investment in the CLO.

3.875% Senior Notes. In January 2013, Carlyle Holdings Finance L.L.C., an indirect finance subsidiary of the Partnership, issued $500.0 million of 3.875% senior notes due February 1, 2023 at 99.966% of par. Interest is payable semi-annually on February 1 and August 1, beginning August 1, 2013. The notes are unsecured and unsubordinated obligations of Carlyle Holdings Finance L.L.C. and are fully and unconditionally guaranteed, jointly and severally, by The Carlyle Group L.P. and each of the Carlyle Holdings partnerships. The indenture governing the notes contains customary covenants that, among other things, limit Carlyle Holdings Finance L.L.C. and the guarantors’ ability, subject to certain exceptions, to incur indebtedness secured by liens on voting stock or profit participating equity interests of their subsidiaries or merge, consolidate or sell, transfer or lease assets. The notes also contain customary events of default. All or a portion of the notes may be redeemed at our option, in whole or in part, at any time and from time to time, prior to their stated maturity, at the make-whole

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redemption price set forth in the notes. If a change of control repurchase event occurs, the notes are subject to repurchase at the repurchase price as set forth in the notes.

5.625% Senior Notes. In March 2013, Carlyle Holdings II Finance L.L.C., an indirect finance subsidiary of the Partnership, issued $400.0 million of 5.625% Senior Notes due March 30, 2043 at 99.583% of par. Interest is payable semi-annually on March 30 and September 30, beginning September 30, 2013. The notes are unsecured and unsubordinated obligations of Carlyle Holdings II Finance L.L.C. and are fully and unconditionally guaranteed, jointly and severally, by The Carlyle Group L.P. and each of the Carlyle Holdings partnerships. The indenture governing the notes contains customary covenants and financial restrictions that, among other things, limit Carlyle Holdings Finance II L.L.C. and the guarantors’ ability, subject to certain exceptions, to incur indebtedness secured by liens on voting stock or profit participating equity interests of their subsidiaries or merge, consolidate or sell, transfer or lease assets. The notes also contain customary events of default. All or a portion of the notes may be redeemed at our option, in whole or in part, at any time and from time to time, prior to their stated maturity, at the make-whole redemption price set forth in the notes. If a change of control repurchase event occurs, the notes are subject to repurchase at the repurchase price as set forth in the notes.

In March 2014, Carlyle Holdings II Finance L.L.C. issued $200.0 million of 5.625% Senior Notes due March 30, 2043 at 104.315% of par. These notes were issued as additional 5.625% Senior Notes due March 30, 2043 and will be treated as a single class with the already outstanding $400.0 million aggregate principal amount of these senior notes.

Obligations of CLOs. Loans payable of the Consolidated Funds represent amounts due to holders of debt securities issued by the CLOs. We are not liable for any loans payable of the CLOs. Several of the CLOs issued preferred shares representing the most subordinated interest, however these tranches are mandatorily redeemable upon the maturity dates of the senior secured loans payable, and as a result have been classified as liabilities under U.S. GAAP, and are included in loans payable of Consolidated Funds in our combined and consolidated balance sheets.

As of March 31, 2015, the following borrowings were outstanding at our CLOs, including preferred shares classified as liabilities (dollars in millions):

	Borrowing Outstanding		Weighted Average Interest Rate			Weighted Average Remaining Maturity in Years
Senior secured notes	$	15,528.1	1.70	%	%	9.17
Subordinated notes and preferred shares	1,238.2		N/A		(1)	8.21
Combination notes	20.0		N/A		(2)	8.19
Total	$	16,786.3

(1) The subordinated notes and preferred shares do not have contractual interest rates, but instead receive distributions from the excess cash flows of the CLOs.

(2) The combination notes do not have contractual interest rates and have recourse only to securities specifically held to collateralize such combination notes.    

The fair value of senior secured notes, subordinated notes and preferred shares, and combination notes of our CLOs as of March 31, 2015 was $15,264.8 million, $1,268.6 million, and $21.2 million, respectively.

Loans payable of the CLOs are collateralized by the assets held by the CLOs and the assets of one CLO may not be used to satisfy the liabilities of another. This collateral consists of cash and cash equivalents, corporate loans, corporate bonds and other securities.

Loans Payable of a Consolidated Real Estate VIE. This balance consists of the borrowings of Urbplan for its real estate development activities. As of March 31, 2015, the principal amount outstanding on the loans was approximately $214.8 million. The Partnership records the borrowings of Urbplan at fair value on its consolidated balance sheet; the fair value of the Urbplan borrowings at March 31, 2015 was $139.6 million. The principal amounts of the loans accrue interest at a variable rate based on an index plus an applicable margin. Interest rates are based on: (i) CDI plus a margin ranging from 4.0% to 7.4% (16.6% to 20.0% as of March 31, 2015); (ii) IGP-M plus a margin of 12.0% (15.1% as of March 31, 2015); or (iii) IPCA plus a margin ranging from 10.0% to 13.5% (18.1% to 21.6% as of March 31, 2015).

Substantially all of Urbplan’s customer and other receivables and investments have been pledged as collateral for the loans. As of March 31, 2015, substantially all of the loans payable of Urbplan are not in compliance with their related debt

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covenants or are otherwise in technical default. These violations do not cause a default or event of default under the Partnership’s senior credit facility or senior notes. Urbplan management is in discussions with the lenders to cure or re-negotiate the loans in default. Currently there are no outstanding notices of acceleration of payment on the loans in default.

All of the loans payable of Urbplan are contractually non-recourse to us.

Unconsolidated Entities

Our Corporate Private Equity funds have not historically utilized substantial leverage at the fund level other than short-term borrowings under certain fund level lines of credit which are used to fund liquidity needs in the interim between the date of an investment and the receipt of capital from the investing fund’s investors. These funds do, however, make direct or indirect investments in companies that utilize leverage in their capital structure. The degree of leverage employed varies among portfolio companies.

Certain of our real estate funds have entered into lines of credits secured by their investors’ unpaid capital commitments or by a pledge of the equity of the underlying investment. Due to the relatively large number of investments made by these funds, the lines of credit are primarily employed to reduce the overall number of capital calls or for working capital needs. In certain instances, however, they may be used for other investment related activities, including serving as bridge financing for investments. The degree of leverage employed varies among portfolio companies.

Off-balance Sheet Arrangements

In the normal course of business, we enter into various off-balance sheet arrangements including sponsoring and owning limited or general partner interests in consolidated and non-consolidated funds, entering into derivative transactions, entering into operating leases and entering into guarantee arrangements. We also have ongoing capital commitment arrangements with certain of our consolidated and non-consolidated funds. We do not have any other off-balance sheet arrangements that would require us to fund losses or guarantee target returns to investors in any of our other investment funds.

For further information regarding our off-balance sheet arrangements, see Note 2 to the unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q.

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Contractual Obligations

The following table sets forth information relating to our contractual obligations as of March 31, 2015 on a consolidated basis and on a basis excluding the obligations of the Consolidated Funds:

	April 1, 2015 to December 31, 2015			2016-2017			2018-2019			Thereafter			Total
	(Dollars in millions)
Loans payable and senior notes(a)	$	—		$	—		$	38.4		$	1,100.0		$	1,138.4
Interest payable(b)	42.1			109.0			107.0			844.4			1,102.5
Contingent cash consideration(c)	36.8			103.8			64.8			291.2			496.6
Operating lease obligations(d)	39.3			99.2			82.1			229.6			450.2
Capital commitments to Carlyle funds(e)	3,147.3			—			—			—			3,147.3
Tax receivable agreement payments(f)	—			6.7			7.5			73.9			88.1
Loans payable of Consolidated Funds(g)	427.6			529.5			881.4			17,541.3			19,379.8
Loans payable of a consolidated real estate VIE(h)	50.9			99.3			91.7			249.8			491.7
Unfunded commitments of the CLOs and Consolidated Funds(i)	806.1			—			—			—			806.1
Redemptions payable of Consolidated Funds(j)	197.9			—			—			—			197.9
Consolidated contractual obligations	4,748.0			947.5			1,272.9			20,330.2			27,298.6
Loans payable of Consolidated Funds(g)	(427.6		)	(529.5		)	(881.4		)	(17,541.3		)	(19,379.8		)
Loans payable of a consolidated real estate VIE(h)	(50.9		)	(99.3		)	(91.7		)	(249.8		)	(491.7		)
Capital commitments to Carlyle funds(e)	(2,821.4		)	—			—			—			(2,821.4		)
Unfunded commitments of the CLOs and Consolidated Funds(i)	(806.1		)	—			—			—			(806.1		)
Redemptions payable of Consolidated Funds(j)	(197.9		)	—			—			—			(197.9		)
Carlyle Operating Entities contractual obligations	$	444.1		$	318.7		$	299.8		$	2,539.1		$	3,601.7

(a) The table above assumes that no prepayments are made on the term loans or senior notes and that the outstanding balance on the revolving credit facility is repaid on the maturity date of the senior credit facility. On May 5, 2015, we entered into Amendment No. 2 to the senior credit facility to extend the maturity date of the term loan and revolving credit facility from August 9, 2018 until May 5, 2020. The term loan entered into during 2013 related to an investment in a CLO matures on the earlier of 2018 or the date that the CLO is dissolved. For purposes of the table above, it is assumed that the CLO does not dissolve prior to 2018.

(b) The interest rate on the loans payable consist of 3.875% on $500.0 million of senior notes, 5.625% on $600.0 million of senior notes, approximately 2.33% on $25.0 million of the term loan of our senior credit facility (inclusive of the effect of the outstanding interest rate swaps), and approximately 1.77% on $13.4 million of our other term loan. Interest payments assume that no prepayments are made and loans are held until maturity.

(c) These obligations represent our probability-weighted estimate of amounts to be paid on the contingent cash consideration obligations associated with our business acquisitions and strategic investment in NGP Management. The actual amounts to be paid under these agreements will not be determined until the specific performance conditions are met. Refer to “— Contingent Cash Payments for Business Acquisitions and Strategic Investments” below for the maximum amounts we may be required to pay under these arrangements and Note 6 and Note 9 to the unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q for more information. Included in these amounts are $30.3 million of employment-based contingent consideration payments that have been earned but are not payable until the individuals are no longer employees of Carlyle, the timing of which cannot be predicted. For purposes of the table above, the timing has been based on a probability-weighted estimate.

(d) We lease office space in various countries around the world and maintain our headquarters in Washington, D.C., where we lease our primary office space under a non-cancelable lease agreement expiring on July 31, 2026. Our office leases in other locations expire in various years from 2015 through 2031. The amounts in this table represent the minimum lease payments required over the term of the lease.

(e) These obligations represent commitments by us to fund a portion of the purchase price paid for each investment made by our funds. These amounts are generally due on demand and are therefore presented in the less than one year category. A substantial majority of these investments is expected to be funded by senior Carlyle professionals and other professionals through our internal co-investment program. Of the $3.1 billion of unfunded commitments, approximately $2.8 billion is subscribed individually by senior Carlyle professionals, operating executives and other professionals, with the balance funded directly by the Partnership.

(f) Represents obligations by the Partnership’s corporate taxpayers to make payments under the tax receivable agreement. Holders of partnership units in Carlyle Holdings may exchange their Carlyle Holdings partnership units for common units in The Carlyle Group L.P. on a one-for-one basis. These exchanges may reduce the amount of tax that the corporate taxpayers would be required to pay in the future. The corporate taxpayers will pay to the limited partner of Carlyle Holdings making the exchange 85% of the amount of cash savings that the corporate taxpayers realize upon an exchange. See “Tax Receivable Agreement” below.

(g) These obligations represent amounts due to holders of debt securities issued by the consolidated CLO vehicles. These obligations include interest to be paid on debt securities issued by the consolidated CLO vehicles. Interest payments assume that no prepayments are made and loans are held until maturity. For debt securities with rights only to the residual value of the CLO and no stated interest, no interest payments were included in this

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calculation. Interest payments on variable-rate debt securities are based on interest rates in effect as of March 31, 2015, at spreads to market rates pursuant to the debt agreements, and range from 0.28% to 12.65%.

(h) These obligations represent amounts owed to the lenders of Urbplan. These obligations include interest to be paid on the loans of Urbplan. Principal and interest payments shown herein assume that amounts will be paid according to the contractual maturities of the loans without acceleration due to default or covenant violation or other voluntarily prepayments. Interest payments on variable-rate debt are based on interest rates in effect as of March 31, 2015, at spreads to market rates pursuant to the loan agreements, and range from 15.1% to 21.6%. Due to the timing and availability of financial information from Urbplan, we consolidate the financial position and results of operations of Urbplan on a financial reporting lag of 90 days. The balances shown in this table are based on Urbplan’s outstanding borrowings as of December 31, 2014.

(i) These obligations represent commitments of the CLOs and Consolidated Funds to fund certain investments. These amounts are generally due on demand and are therefore presented in the less than one year category.

(j) Our consolidated hedge funds are subject to quarterly or monthly redemption by investors in these funds. These obligations represent the amount of redemptions where the amount requested in the redemption notice has become fixed and payable.

Excluded from the table above are liabilities for uncertain tax positions of $18.8 million at March 31, 2015 as we are unable to estimate when such amounts may be paid. Also excluded from the table above are outstanding commitments of Urbplan for land development services with an estimated $86 million of future costs to be incurred; these amounts have been excluded as we are unable to determine when such amounts will be paid.

Contingent Funding of the Consolidated Real Estate VIE

As described in Note 17 to the unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q, we and certain of our senior Carlyle professionals have made and may make additional investments in Urbplan. From 2013 through March 31, 2015, $227.4 million has been funded to Urbplan by us and our senior Carlyle professionals (net of gains from related foreign currency forward contracts). We have funded $54.3 million of the $227.4 million and the remaining $173.1 million has been funded by our senior Carlyle professionals indirectly through the Partnership. For the three months ended March 31, 2015, $14.1 million was funded to Urbplan, of which we funded $3.5 million and the senior Carlyle professionals funded $10.6 million indirectly through us.

From April 2013 through March 31, 2015, the cumulative investment losses related to Urbplan totaled $43.3 million, of which $38.9 million were realized losses and $4.4 million are unrealized losses.

At this time, Urbplan is estimated to require approximately $90 million of additional capital over the next twelve months to complete its expected business turnaround. While no contractual or other obligations exist to provide additional financial support to Urbplan, we and our senior Carlyle professionals expect to provide additional capital funding to Urbplan in the future and Urbplan will continue to seek capital funding from unaffiliated parties. We and our senior Carlyle professionals will evaluate the possibility of further capital infusions based on the circumstances at the time (including levels of third-party funding participation). It is anticipated that we would fund 25% and our senior Carlyle professionals would fund 75% indirectly through us of any additional investments made by us and our senior Carlyle professionals.

We may not recover, in whole or in part, the capital that we have invested in or any additional capital that we may elect to invest in Urbplan in the future, and our results of operations could be adversely impacted by impairments, write-downs, lawsuits by customers or creditors, other claims against Urbplan or us or other losses associated with our investment in Urbplan. Urbplan is currently a party to various litigation, disputes and other potential claims. We do not believe it is probable that the outcome of any existing Urbplan litigation, government investigations and proceedings, disputes, or other potential claims will materially affect us or our consolidated financial statements.

The assets and liabilities of Urbplan are held in legal entities separate from the Partnership; we have not guaranteed or assumed any obligation for repayment of Urbplan’s liabilities nor are the assets of Urbplan available to meet our liquidity requirements. However, if Urbplan fails to complete its construction projects, customers, partners, government agencies or municipalities or other creditors in certain circumstances might seek to assert claims against us and our assets unrelated to Urbplan under certain consumer protection or other laws.

Contingent Cash Payments for Business Acquisitions and Strategic Investments

We have certain contingent cash obligations associated with our business acquisitions and our strategic investment in NGP Management. For our business acquisitions, these contingent cash payments relate to performance-based contingent cash consideration payable to the sellers of the businesses, some of whom are Carlyle professionals. Certain of these payments to those Carlyle professionals require such Carlyle professionals to be employed by us at the time the performance conditions are met, while other payments are not contingent upon employment.

For our strategic investment in NGP Management, the contingent cash payments relate to performance-based contingent cash consideration payable to ECM Capital, L.P. and an affiliate of Barclays Bank PLC. The performance-based contingent cash consideration payable to an affiliate of Barclays Bank PLC totaling $183.0 million, which will be payable in 2016

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approximately one-third in cash and approximately two-thirds by a six year promissory note (accruing interest at the three month LIBOR plus 2.5%) issued by the Partnership, if the performance conditions are met, is earned based on NGP’s achievement of certain business performance goals, including the successful fundraising by NGP of new fund commitments. See Note 6 to the unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q for more information.

The amounts shown in the contractual obligations table above represent our probability-weighted estimate of amounts to be paid on the contingent cash consideration obligations associated with our business acquisitions and our strategic investment in NGP Management. Except as noted below, the following table represents the maximum amounts that could be paid from our contingent cash obligations associated with our business acquisitions and our strategic investment in NGP Management:

	As of March 31, 2015
	Business Acquisitions		NGP Investment		Total		Liability Recognized on Financial Statements(1)
	(Dollars in millions)
Performance-based contingent cash consideration	$	231.8	$	183.0	$	414.8	$	253.6
Employment-based contingent cash consideration	255.0		45.0		300.0		141.8
Total	$	486.8	$	228.0	$	714.8	$	395.4

(1) On our consolidated balance sheet, the liability for performance-based contingent cash consideration is included in due to affiliates (for amounts owed to Carlyle professionals and NGP) and accounts payable, accrued expenses, and other liabilities (for amounts owed to other sellers), and the liability for employment-based contingent cash consideration is included in accrued compensation and benefits.

Some of the employment-based contingent cash consideration agreements do not contain provisions limiting the amount that could be paid by us. For purposes of the table above, we have used our current estimate of the amount to be paid upon the determination dates for such payments. In our consolidated financial statements, we record the performance-based contingent cash consideration from our business acquisitions at fair value at each reporting period. For the employment-based contingent cash consideration, we accrue the compensation liability over the implied service period.

Guarantees

In 2001, we entered into an agreement with a financial institution pursuant to which we are the guarantor on a credit facility for eligible employees investing in Carlyle sponsored funds. This credit facility renews on an annual basis, allowing for annual incremental borrowings up to an aggregate of $11.3 million, and accrues interest at the lower of the prime rate, as defined, or three-month LIBOR plus 2%, reset quarterly. At March 31, 2015, approximately $7.8 million was outstanding under the credit facility and payable by the employees. No material funding under the guarantee has been required, and we believe the likelihood of any material funding under the guarantee to be remote.

Indemnifications

In many of our service contracts, we agree to indemnify the third-party service provider under certain circumstances. The terms of the indemnities vary from contract to contract, and the amount of indemnification liability, if any, cannot be determined and has not been included in the table above or recorded in our consolidated financial statements as of March 31, 2015.

Tax Receivable Agreement

Holders of partnership units in Carlyle Holdings (other than The Carlyle Group L.P.’s wholly-owned subsidiaries), subject to the vesting and minimum retained ownership requirements and transfer restrictions applicable to such holders as set forth in the partnership agreements of the Carlyle Holdings partnerships, may (subject to the terms of the exchange agreement) exchange their Carlyle Holdings partnership units for The Carlyle Group L.P. common units on a one-for-one basis. A Carlyle Holdings limited partner must exchange one partnership unit in each of the three Carlyle Holdings partnerships to effect an exchange for a common unit. The exchanges are expected to result in increases in the tax basis of the tangible and intangible assets of Carlyle Holdings. These increases in tax basis may increase (for tax purposes) depreciation and amortization deductions and therefore reduce the amount of tax that Carlyle Holdings I GP Inc. and any other corporate taxpayers would otherwise be required to pay in the future, although the IRS may challenge all or part of that tax basis increase, and a court could sustain such a challenge.

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In connection with the reorganization and initial public offering, we have entered into a tax receivable agreement with the limited partners of the Carlyle Holdings partnerships that will provide for the payment by the corporate taxpayers to such parties of 85% of the amount of cash savings, if any, in U.S. federal, state and local income tax or franchise tax that the corporate taxpayers realize as a result of these increases in tax basis and of certain other tax benefits related to entering into the tax receivable agreement, including tax benefits attributable to payments under the tax receivable agreement. This payment obligation is an obligation of the corporate taxpayers and not of Carlyle Holdings. While the actual increase in tax basis, as well as the amount and timing of any payments under this agreement, will vary depending upon a number of factors, including the timing of exchanges, the price of our common units at the time of the exchange, the extent to which such exchanges are taxable and the amount and timing of our income, we expect that as a result of the size of the transfers and increases in the tax basis of the tangible and intangible assets of Carlyle Holdings, the payments that we may make under the tax receivable agreement will be substantial. The payments under the tax receivable agreement are not conditioned upon these parties’ continued ownership of us. In the event that The Carlyle Group L.P. or any of its wholly-owned subsidiaries that are not treated as corporations for U.S. federal income tax purposes become taxable as a corporation for U.S. federal income tax purposes, these entities will also be obligated to make payments under the tax receivable agreement on the same basis and to the same extent as the corporate taxpayers.

The tax receivable agreement provides that upon certain changes of control, or if, at any time, the corporate taxpayers elect an early termination of the tax receivable agreement, the corporate taxpayers’ obligations under the tax receivable agreement (with respect to all Carlyle Holdings partnership units whether or not previously exchanged) would be calculated by reference to the value of all future payments that the counterparties would have been entitled to receive under the tax receivable agreement using certain valuation assumptions, including that the corporate taxpayers’ will have sufficient taxable income to fully utilize the deductions arising from the increased tax deductions and tax basis and other benefits related to entering into the tax receivable agreement and, in the case of an early termination election, that any Carlyle Holdings partnership units that have not been exchanged are deemed exchanged for the market value of the common units at the time of termination. In addition, the counterparties will not reimburse us for any payments previously made under the tax receivable agreement if such tax basis increase is successfully challenged by the IRS. The corporate taxpayers’ ability to achieve benefits from any tax basis increase, and the payments to be made under this agreement, will depend upon a number of factors, including the timing and amount of our future income. As a result, even in the absence of a change of control or an election to terminate the tax receivable agreement, payments under the tax receivable agreement could be in excess of the corporate taxpayers’ actual cash tax savings.

Contingent Obligations (Giveback)

An accrual for potential repayment of previously received performance fees of $176.6 million at March 31, 2015 ($184.5 million before $7.9 million is eliminated in the consolidation of Consolidated Funds) is shown as accrued giveback obligations on the consolidated balance sheet, representing the giveback obligation that would need to be paid if the funds were liquidated at their current fair values at March 31, 2015. However, the ultimate giveback obligation, if any, does not arise until the end of a fund’s life. We have recorded $28.4 million of unbilled receivables from former and current employees and our individual senior Carlyle professionals as of March 31, 2015 related to giveback obligations, which are included in due from affiliates and other receivables, net in our consolidated balance sheet as of such date.

If, as of March 31, 2015, all of the investments held by our funds were deemed worthless, the amount of realized and distributed carried interest subject to potential giveback would be $1.4 billion, on an after-tax basis where applicable.

Our senior Carlyle professionals and employees who have received carried interest distributions are severally responsible for funding their proportionate share of any giveback obligations. However, the governing agreements of certain of our funds provide that to the extent a current or former employee from such funds does not fund his or her respective share, then we may have to fund additional amounts beyond what we received in carried interest, although we will generally retain the right to pursue any remedies that we have under such governing agreements against those carried interest recipients who fail to fund their obligations.

Contingencies

In the ordinary course of business, we are a party to litigation, investigations, disputes and other potential claims. Certain of these matters are described below. We are not currently able to estimate the reasonably possible amount of loss or range of loss for the matters that have not been resolved. We do not believe it is probable that the outcome of any existing litigation, investigations, disputes or other potential claims will materially affect us. We believe that these matters described below are without merit and intend to vigorously contest all allegations for the matters that have not been resolved.

On February 14, 2008, a private class-action lawsuit challenging “club” bids and other alleged anti-competitive business practices was filed in the U.S. District Court for the District of Massachusetts (Police and Fire Retirement System of the City of Detroit v. Apollo Global Management, LLC, later renamed Kirk Dahl v. Bain Capital Partners LLC). The complaint

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alleges, among other things, that certain global alternative asset firms, including the Partnership, violated Section 1 of the Sherman Act by forming multi-sponsor consortiums for the purpose of bidding collectively in company buyout transactions in certain going private transactions and agreeing not to submit topping bids once a consortium has announced a signed deal, which the plaintiffs allege constitutes a “conspiracy in restraint of trade.” To avoid the risk and cost associated with continuing the litigation through trial, we entered into an agreement with plaintiffs on August 29, 2014 to settle all claims against us without any admission of liability. All of our codefendants also reached settlement agreements with plaintiffs. The Court approved all the defendants' settlements, including Carlyle's, on March 17, 2015. Carlyle Partners IV, L.P. (“CP IV”) and its affiliates incurred the costs of the settlement not covered by insurance. As a result, Carlyle's performance fees from CP IV were reduced by $19.3 million in 2014.

Along with many other companies and individuals in the financial sector, Carlyle and Carlyle Mezzanine Partners, L.P. (“CMP”) are named as defendants in Foy v. Austin Capital, a case filed in June 2009, pending in the State of New Mexico’s First Judicial District Court, County of Santa Fe, which purports to be a qui tam suit on behalf of the State of New Mexico. The suit alleges that investment decisions by New Mexico public investment funds were improperly influenced by campaign contributions and payments to politically connected placement agents. The plaintiffs seek, among other things, actual damages, actual damages for lost income, rescission of the investment transactions described in the complaint and disgorgement of all fees received. In May 2011, the Attorney General of New Mexico moved to dismiss certain defendants including Carlyle and CMP on the grounds that separate civil litigation by the Attorney General is a more effective means to seek recovery for the State from these defendants. The Attorney General has brought two civil actions against certain of those defendants, not including the Carlyle defendants. The Attorney General has stated that its investigation is continuing and it may bring additional civil actions.

Carlyle Capital Corporation Limited (“CCC”) was a fund sponsored by Carlyle that invested in AAA-rated residential mortgage backed securities on a highly leveraged basis. In March of 2008, amidst turmoil throughout the mortgage markets and money markets, CCC filed for insolvency protection in Guernsey. Six different lawsuits developed from the CCC insolvency. Four of such lawsuits were dismissed or withdrawn. Two of such lawsuits remain and they are described below.

First, in November 2009, a CCC investor, National Industries Group (Holding) (“National Industries”) instituted legal proceedings in Kuwait’s Court of First Instance (National Industries Group v. Carlyle Group ) seeking to recover losses incurred in connection with an investment in CCC. In July 2011, the Delaware Court of Chancery issued a decision restraining National Industries from proceeding in Kuwait on any CCC-related claims based on the forum selection clause in National Industries’ subscription agreement, which provided for exclusive jurisdiction in the Delaware courts. Notwithstanding the ruling by the Delaware court, National Industries continued to pursue claims in Kuwait against CCC and us and National Industries also appealed the Delaware ruling. However, the court in Kuwait dismissed National Industries claims without prejudice for failure to serve process. Also, on May 29, 2013, the Delaware Supreme Court affirmed the Chancery Court’s decision and upheld the 2011 injunction barring National Industries from filing or prosecuting any CCC-related action in any forum other than the courts of Delaware. The statute of limitations for claims in Delaware has expired.

Second, the Guernsey liquidators who took control of CCC in March 2008 filed a suit on July 7, 2010 against Carlyle, certain of its affiliates and the former directors of CCC in the Royal Court of Guernsey (Carlyle Capital Corporation Limited v. Conway et al.) seeking $1.0 billion in damages. They allege that Carlyle and the CCC board of directors were negligent, grossly negligent or willfully mismanaged the CCC investment program and breached certain fiduciary duties allegedly owed to CCC and its shareholders. The liquidators further allege (among other things) that the directors and Carlyle put the interests of Carlyle ahead of the interests of CCC and its shareholders and gave priority to preserving and enhancing Carlyle’s reputation and its “brand” over the best interests of CCC. On July 24, 2013, plaintiffs filed an amended complaint, which contained further detail in support of the existing claims but no new defendants or claims. On December 20, 2013, defendants filed a defense to the amended complaint and on June 30, 2014 plaintiffs filed their reply. The Court has set the case schedule and trial is scheduled for the first available date after March 28, 2016.

It is not possible to predict the ultimate outcome of all pending investigations and legal proceedings, and some of the matters discussed above involve claims for potentially large and/or indeterminate amounts of damages. Based on information known by management, management has not concluded that as of the date of this filing the final resolutions of the matters above will have a material effect upon the Partnership’s consolidated financial statements. However, given the potentially large and/or indeterminate amounts of damages sought in certain of these matters and the inherent unpredictability of investigations and litigations, it is possible that an adverse outcome in certain matters could, from time to time, have a material effect on our financial results in any particular period.

Other Contingencies

From 2007 to 2009, a Luxembourg subsidiary of CEREP I, a real estate fund, received proceeds from the sale of real estate located in Paris, France. Based on a provision in the Luxembourg-France tax treaty, it did not report or pay tax in France

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on gain from the sale. The French tax authorities asserted that CEREP I was ineligible to claim exemptions from French tax under the tax treaty, and issued a tax assessment seeking to collect taxes, interest and penalties.

An income tax hearing on these matters was held on March 11, 2015 in front of the French tax court. On April 15, 2015, the French tax court issued an opinion in this matter that is adverse to CEREP I, holding the Luxembourg property company liable for €105 million (including interest accrued since the beginning of the tax dispute). The Partnership disagrees with the outcome and is appealing. CEREP I has approximately €31.0 million in net assets as of March 31, 2015. The remaining €74.0 million of the tax obligations will be paid by us. Additionally, the French Ministry of Justice is expected to continue its investigation of the actions of the Luxembourg property company and its former directors, managers and representatives in claiming the tax treaty exemptions.

We were required to provide a financial guarantee to the French government in July 2012 for the amount of French tax assessed against CEREP I. Since that time, we have consolidated CEREP I into our consolidated financial statements. Beginning with the quarter ended December 31, 2013, CEREP I had accrued a €75 million liability with respect to the French tax matter. As of March 31, 2015, CEREP I has increased the liability to €105 million ($112 million) to reflect the French tax court judgment, and the total liability is included in other liabilities of Consolidated Funds in our condensed consolidated financial statements. For the three months ended March 31, 2015, CEREP I has recognized a loss of approximately $34 million which has been included in net investment gains/losses of Consolidated Funds, and this amount reduced net income attributable to Carlyle Holdings in our condensed consolidated financial statements. In 2013 and 2014, we had previously recognized losses of approximately €42 million for the French tax matter, which were reflected in net investment gains/losses of Consolidated Funds and reduced net income attributable to Carlyle Holdings.

Carlyle Holdings Partnership Units

A rollforward of the outstanding Carlyle Holdings partnership units from December 31, 2014 through March 31, 2015 is as follows:

	Units as of December 31, 2014	Units Issued	Units Forfeited		Units Exchanged		Units as of March 31, 2015
Carlyle Holdings partnership units held by the Partnership	67,029,042	1,029,577	—		131,214		68,189,833
Carlyle Holdings partnership units not held by the Partnership	251,195,295	—	(91,174	)	(131,214	)	250,972,907
Total Carlyle Holdings partnership units	318,224,337	1,029,577	(91,174	)	—		319,162,740

The Carlyle Holdings partnership units issued to the Partnership during the period from December 31, 2014 through March 31, 2015 relate to: (i) the vesting of the Partnership’s deferred restricted common units during the three months ended March 31, 2015, (ii) the satisfaction of certain performance-vesting contingent consideration arrangements related to our acquisition of DGAM, and (iii) the acquisition by the Partnership of 15,566 Carlyle Holdings partnership units upon the vesting of certain of the Partnership’s common units associated with the acquisition of the remaining 40% equity interest in AlpInvest in August 2013. Further, the Partnership is expected to acquire an additional 716,404 Carlyle Holdings partnership units in future periods upon the vesting of certain of the Partnership’s unvested common units associated with the acquisition of the remaining 40% equity interest in AlpInvest in August 2013.

The Carlyle Holdings partnership units forfeited during the period from December 31, 2014 through March 31, 2015 relate to unvested Carlyle Holdings partnership units that were forfeited when the holder ceased to provide services to the Partnership. The Carlyle Holdings partnership units exchanged relate to the exchange of Carlyle Holdings partnership units held by NGP for common units on a one-for-one basis.

Item 3.    Quantitative and Qualitative Disclosures About Market Risk

Our primary exposure to market risk is related to our role as general partner or investment advisor to our investment funds and the sensitivities to movements in the fair value of their investments, including the effect on management fees, performance fees and investment income. Although our investment funds share many common themes, each of our alternative asset management asset classes runs its own investment and risk management processes, subject to our overall risk tolerance and philosophy. The investment process of our investment funds involves a comprehensive due diligence approach, including review of reputation of shareholders and management, company size and sensitivity of cash flow generation, business sector and competitive risks, portfolio fit, exit risks and other key factors highlighted by the deal team. Key investment decisions are subject to approval by both the fund-level managing directors, as well as the investment committee, which is generally

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comprised of one or more of the three founding partners, one “sector” head, one or more operating executives and senior investment professionals associated with that particular fund. Once an investment in a portfolio company has been made, our fund teams closely monitor the performance of the portfolio company, generally through frequent contact with management and the receipt of financial and management reports.

There was no material change in our market risks during the three months ended March 31, 2015. For additional information, refer to our Annual Report on Form 10-K for the year ended December 31, 2014.

Item 4.    Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures (as that term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) that are designed to ensure that information required to be disclosed in our reports under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our co-principal executive officers and principal financial officer, as appropriate, to allow timely decisions regarding required disclosures. In designing disclosure controls and procedures, our management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible disclosure controls and procedures. The design of any disclosure controls and procedures also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Any controls and procedures, no matter how well designed and operated, can provide only reasonable, not absolute, assurance of achieving the desired control objectives.

Our management, with the participation of our co-principal executive officers and principal financial officer, has evaluated the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this report. Based upon that evaluation and subject to the foregoing, our co-principal executive officers and principal financial officer concluded that, as of the end of the period covered by this report, the design and operation of our disclosure controls and procedures were effective to accomplish their objectives at the reasonable assurance level.

Changes in Internal Control over Financial Reporting

There have been no changes in our internal control over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act) during the fiscal quarter ended March 31, 2015 that have materially affected, or that are reasonably likely to materially affect, our internal control over financial reporting.

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PART II - OTHER INFORMATION

Item 1.         Legal Proceedings

The information required with respect to this item can be found under “Legal Matters” in Note 11, Commitments and Contingencies, of the notes to the Partnership’s unaudited condensed consolidated financial statements contained in this quarterly report, and such information is incorporated by reference into this Item 1.

Item 1A.    Risk Factors

For a discussion of our potential risks and uncertainties, see the information under Item 1A. “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2014, which is accessible on the SEC’s website at sec.gov.

Item 2.        Unregistered Sales of Equity Securities and Use of Proceeds

Not applicable.

Item 3.         Defaults Upon Senior Securities

Not applicable.

Item 4.         Mine Safety Disclosures

Not applicable.

Item 5.         Other Information

Amendment to Senior Credit Facility

On May 5, 2015, we entered into Amendment No. 2 to the senior credit facility, which: (i) extends the maturity date of the term loan and revolving credit facility from August 9, 2018 to May 5, 2020, (ii) revises the management fee earning assets covenant to remove the step up requirement to add 70% of future acquired AUM and to set the minimum management fee earning assets amount at $65.3 billion, (iii) changes the definition of Indebtedness to provide for a deduction of unrestricted cash, and (iv) reduces the corporate ratings-based pricing grid. The description of Amendment No. 2 is qualified in its entirety by reference to the terms of such amendment, which is attached hereto as Exhibit No. 10.24.2.

Information Regarding Our Board of Directors

Jay Fishman, one of our independent directors, currently serves as Chairman and Chief Executive Officer of The Travelers Companies, Inc. In late 2014, Mr. Fishman announced that he had been diagnosed with a neuromuscular condition and more recently announced his intention to cut back on his non-Travelers’ commitments. Although Mr. Fishman has not made a decision to resign from our Board of Directors, it is possible that he may do so.

Item 6.         Exhibits

Required exhibits are listed in the Index to Exhibits and are incorporated herein by reference.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	The Carlyle Group L.P.
	By:	Carlyle Group Management L.L.C., its general partner
Date: May 7, 2015	By:	/s/ Curtis L. Buser
	Name:	Curtis L. Buser
	Title:	Chief Financial Officer
		(Principal Financial Officer and Authorized Officer)

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INDEX TO EXHIBITS

The following is a list of all exhibits filed or furnished as part of this report:

Exhibit No.	Description
3.1	Certificate of Limited Partnership of The Carlyle Group L.P. (incorporated by reference to Exhibit 3.1 to Registrant’s Registration Statement on Form S-1 (File No. 333-176685) filed with the SEC on September 6, 2011).
3.2	Amended and Restated Limited Partnership Agreement of The Carlyle Group L.P. (incorporated by reference to Exhibit 3.1 on Form 8-K filed with the SEC on May 8, 2012).
10.24.2 *	Amendment No. 2, dated as of May 5, 2015, to the Credit Agreement, dated as of December 13, 2011, among TC Group Investment Holdings, L.P., TC Group Cayman Investment Holdings, L.P., TC Group Cayman, L.P., Carlyle Investment Management L.L.C., as Borrowers, TC Group, L.L.C., the Guarantors party thereto, the Lenders party thereto, and Citibank, N.A., as Administrative Agent, and Citigroup Global Markets Inc., J.P. Morgan Securities LLC, Credit Suisse Securities (USA) LLC, as Joint Lead Arrangers and Bookrunners, and JPMorgan Chase Bank, N.A., Credit Suisse Securities (USA) LLC, as Syndication Agents.
31.1 *	Certification of the co-principal executive officer pursuant to Rule 13a – 14(a).
31.2 *	Certification of the co-principal executive officer pursuant to Rule 13a – 14(a).
31.3 *	Certification of the co-principal executive officer pursuant to Rule 13a – 14(a).
31.4 *	Certification of the principal financial officer pursuant to Rule 13a – 14(a).
32.1 *	Certification of the co-principal executive officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2 *	Certification of the co-principal executive officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.3 *	Certification of the co-principal executive officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.4 *	Certification of the principal financial officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS	XBRL Instance Document.
101.SCH	XBRL Taxonomy Extension Schema Document.
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB	XBRL Taxonomy Extension Labels Linkbase Document.
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document.

* Filed herewith.

The agreements and other documents filed as exhibits to this report are not intended to provide factual information or other disclosure other than with respect to the terms of the agreements or other documents themselves, and you should not rely on them for that purpose. In particular, any representations and warranties made by us in these agreements or other documents were made solely within the specific context of the relevant agreement or document and may not describe the actual state of affairs as of the date they were made or at any other time.

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EX-10.24.2

Exhibit 10.24.2

Execution Version

AMENDMENT NO. 2

AMENDMENT NO. 2 dated as of May 5, 2015, among each of the “Borrowers” listed on the signature pages hereto (collectively, the “Borrowers”), each of the “Parent Guarantors” listed on the signature pages hereto (collectively, the “Parent Guarantors”), each of the “Subsidiary Guarantors” listed on the signature pages hereto (collectively, the “Subsidiary Guarantors”; together with the Borrowers and the Parent Guarantors, collectively, the “Credit Parties”), each of the “Lenders” (which shall not include any Retiring Lenders) listed on the signature pages hereto (collectively, the “Lenders”), each Retiring Lender (as defined below), solely for purposes of Sections 2.09, 4 and 5 hereof, and Citibank, N.A., as administrative agent for the Lenders (together with its successors in such capacity, the “Administrative Agent”).

The Borrowers, the Parent Guarantors, the Lenders and the Administrative Agent are parties to a Credit Agreement dated as of December 13, 2011 (as amended by Amendment No. 1 thereto dated as of August 9, 2013, the “Credit Agreement”).

Each Lender identified under the caption "Retiring Lenders" on the signature pages hereto (collectively, the "Retiring Lenders") wishes to cease being a "Lender" party to the Credit Agreement and the Borrowers, the Parent Guarantors, the Subsidiary Guarantors, the Lenders, other than the Retiring Lenders, and the Administrative Agent wish now to amend the Credit Agreement in certain respects, and accordingly, the parties hereto hereby agree as follows:

Section 1. Definitions; Authorization. Except as otherwise defined in this Amendment No. 2, terms defined in the Credit Agreement are used herein as defined therein.

Section 2. Amendments. Subject to the satisfaction of the conditions precedent specified in Section 4 below, but effective as of the date hereof, the Credit Agreement shall be amended as follows:

2.01.     References Generally. References in the Credit Agreement (including references to the Credit Agreement as amended hereby) to “this Agreement” (and indirect references such as “hereunder”, “hereby”, “herein” and “hereof”) shall be deemed to be references to the Credit Agreement as amended hereby.

2.02.    Defined Terms. Section 1.01 of the Credit Agreement is hereby amended as follows:

(a)    Amended Definition. The following definitions shall be amended to read in their entirety as follows:

(i) “Applicable Rate” means, for any day with respect to any ABR Loan or Eurocurrency Loan or with respect to the commitment fees payable hereunder, as the case may be, the applicable rate per annum set forth below under the caption “ABR Margin”, “Eurocurrency Margin” or “Commitment Fee”, respectively, based upon the category that applies on such day:

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	S&P Rating	ABR Margin	Eurocurrency Margin	Commitment Fee
Category 1	A+ or higher	0.000%	0.875%	0.080%
Category 2	A	0.000%	1.000%	0.100%
Category 3	A-	0.125%	1.125%	0.125%
Category 4	BBB+	0.250%	1.250%	0.150%
Category 5	Less than BBB+ or unrated	0.500%	1.500%	0.200%

The parties hereto agree that, for purposes of determining the foregoing: (a) (i) for the period commencing on the Initial Funding Date and ending on the date that the Administrative Agent receives written notice from the Obligors that S&P has provided a Rating with respect to any Obligor and (ii) during any other period during which there is no Rating or in which the Obligors shall be in Default of their obligations under Section 6.11, in each case Category 5 shall apply, and (b) in the event the Obligors have different Ratings, the lowest Rating with respect to any Obligor shall apply. If the Rating by S&P shall be changed, such change shall be effective as of the date on which it is first announced by S&P (or, in the case of a private Rating by S&P, on the date on which S&P first notifies the Obligors of such change). Each change in the Applicable Rate shall apply during the period commencing on the effective date of such change in Rating and ending on the date immediately preceding the effective date of the next such change in Rating.

(ii) “Excluded Taxes” means, with respect to the Administrative Agent, any Lender or any Issuing Bank or any other recipient of any payment to be made by or on account of any obligation of any Obligor hereunder, (a) taxes imposed on or measured by its net income (however denominated), franchise taxes, or capital taxes that are imposed on it by the jurisdiction (or any political subdivision thereof) under the laws of which such recipient is organized, in which it has its principal office, seat of management or applicable lending office, or is engaged in business (other than any business in which such person is deemed to engage solely by reason of the transactions contemplated by this Agreement and the other Loan Documents, including the mere holding of an Obligation, receipt of payments or the enforcement of rights thereunder), (b) any branch profits taxes imposed by the United States of America or any similar tax imposed by any other jurisdiction described in clause (a), (c) in the case of a Foreign Lender (other than an assignee pursuant to a request by any Obligor under Section 2.18(b)), any withholding tax that is imposed on amounts payable to such Foreign Lender at the time such Foreign Lender becomes a party hereto (or designates a new lending office) or is attributable to such Foreign Lender’s failure or inability (other than as a result of a Change in Law) to comply with Section 2.16(e), except to the extent that such Foreign Lender (or its assignor, if any) was entitled, at the time of designation of a new lending office (or assignment), to receive additional amounts from any Obligor with respect to such

2

withholding tax pursuant to Section 2.16(a), (d) any U.S. federal, Canadian or Cayman taxes imposed under FATCA, (e) in the case of a U.S. Lender that has failed to comply with Section 2.16(f), any backup withholding tax that is required by the Code to be withheld from amounts payable to such U.S. Lender, and (f) interest and penalties with respect to taxes referred to in clauses (a) through (e).

(iii) “FATCA” means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future United States Treasury regulations promulgated thereunder and published guidance with respect thereto, any agreement entered into pursuant to Section 1471(b)(1) of the Code and any applicable intergovernmental agreements with respect thereto, including any laws, regulations, guidance or practices governing any such intergovernmental agreement.

(iv) “LIBO Rate” means, for the Interest Period for any Eurocurrency Borrowing denominated in any Currency, an interest rate per annum equal to the Screen Rate (as defined below) at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period. In the event that such rate is not available at such time for any reason, then the LIBO Rate with respect to such Eurocurrency Borrowing for such Interest Period (the “Impacted Period”) shall be an interest rate per annum (rounded upwards, if necessary, to the next 1/100 of 1%) determined in good faith by the Administrative Agent (which determination shall be conclusive and binding absent manifest error) to be equal to the rate that results from interpolating on a linear basis between: (a) the Screen Rate (for the longest period for which such Screen Rate is available for the applicable Currency) that is shorter than the Impacted Period and (b) the Screen Rate (for the shortest period for which such Screen Rate is available for the applicable Currency) that exceeds the Impacted Period, in each case, at approximately 11:00 a.m. London time, two Business Days prior to the commencement of such Impacted Period (the “Interpolated Rate”). When determining the rate for a period which is less than the shortest period for which the relevant Screen Rate is available, the Screen Rate for purposes of (a) above shall be deemed to be the overnight screen rate where “overnight screen rate” means, in relation to any Currency, the overnight rate for the applicable Currency determined by the Administrative Agent from such service as the Administrative Agent may reasonably select. For purposes hereof, “Screen Rate” means the London interbank offered rate administered by the ICE Benchmark Administration Limited displayed on Reuters Page LIBOR01 or LIBOR02 (or on any successor or substitute page thereof, or any successor service, providing quotations of interest rates applicable to deposits in the relevant Currency, in the London interbank market comparable to those currently provided on such page, as determined by the Administrative Agent from time to time). In any event the LIBO Rate shall not be less than zero.

(v) “Maturity Date” means May 5, 2020; provided that if such date is not a Business Day, the Maturity Date shall be the immediately preceding Business Day.

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(vi) “Total Indebtedness Ratio” means, at any time, the ratio of (a) the sum of (i) Total Indebtedness at such time minus (ii) the aggregate amount of Unrestricted Cash of the Obligors and their Consolidated Subsidiaries (determined on a consolidated basis without duplication in accordance with GAAP) at such time to (b) EBITDA for the period of four consecutive fiscal quarters ending at such time or the most recently ended prior to such time.

(b)    New Definitions. The following definitions shall be added to Section 1.01 of the Credit Agreement and inserted in the appropriate alphabetical locations as follows:

(i) “Anti-Corruption Laws” means all laws, rules, and regulations of any jurisdiction applicable to any Obligor or its Subsidiaries from time to time concerning or relating to bribery or corruption.

(ii) “Sanctions” means comprehensive economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by (a) the U.S. government, including those administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury or the U.S. Department of State, or (b) the United Nations Security Council, the European Union or Her Majesty’s Treasury of the United Kingdom.

(iii) “Sanctioned Country” means, at any time, a country or territory which is the subject or target of any Sanctions.

(iv) “Sanctioned Person” means, at any time, (a) any Person listed in the list of Specially Designated Nationals and Blocked Persons maintained by the Office of Foreign Assets Control of the U.S. Department of the Treasury, and any Person listed in any Sanctions-related list of designated Persons maintained by the U.S. Department of State, the United Nations Security Council, the European Union or any EU member state, (b) any Person operating, organized or resident in a Sanctioned Country or (c) any Person owned or controlled by any such Person.

(v) “Unrestricted Cash” means the aggregate amount of cash held in bank accounts of the Obligors and their Consolidated Subsidiaries (determined on a consolidated basis without duplication in accordance with GAAP) to the extent that the use of such cash for application to payment of the Obligations or other Indebtedness is not prohibited by law or any written contractual agreement (including, with respect to cash held in a bank account of any Consolidated Subsidiary of an Obligor, that such Consolidated Subsidiary is not subject to any restriction on its ability to distribute such cash to the Obligors), and such cash and cash equivalents are free and clear of all Liens (other than any statutory Liens in favor of banks (including rights of set-off)).

2.03.    Increased Costs. Section 2.14(b) of the Credit Agreement is hereby amended by inserting words "or liquidity" immediately after the words "capital adequacy" in each of the second, fourth and tenth lines thereof.

2.04    Taxes. Section 2.16(e) of the Credit Agreement is hereby deleted and replaced in its entirety with the following:

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“(e)    Status of Foreign Lenders. Each Foreign Lender shall deliver to the Borrowers and the Administrative Agent (or, in the case of a Participant, to the Borrowers and to the Lender from which the related participation shall have been purchased) (i) two accurate and complete copies of IRS Form W-8ECI, W-8BEN, W-8BEN-E or W-8IMY together with supporting documentation, as applicable, or (ii) in the case of a Foreign Lender claiming exemption from United States federal withholding tax under Section 871(h) or 881(c) of the Code with respect to payments of “portfolio interest”, a statement substantially in the form of Exhibit E and two accurate and complete copies of IRS Form W-8BEN, W-8BEN-E or W-8IMY together with supporting documentation, as applicable, or any subsequent versions or successors to such forms, in each case properly completed and duly executed by such Foreign Lender claiming complete exemption from, or a reduced rate of, United States federal withholding tax on all payments by an Obligor under this Agreement and the other Loan Documents. Such forms shall be delivered by each Foreign Lender on or before the date it becomes a party to this Agreement (or, in the case of any Participant, on or before the date such Participant purchases the related participation). In addition, each Foreign Lender shall deliver such forms promptly upon the obsolescence or invalidity of any form previously delivered by such Foreign Lender. Each Foreign Lender shall (i) promptly notify the Borrowers and the Administrative Agent at any time it determines that it is no longer in a position to provide any previously delivered certificate to the Borrowers and Administrative Agent (or any other form of certification adopted by the United States taxing authorities for such purpose) and (ii) take such steps as shall not be disadvantageous to it, in its sole judgment, and as may be reasonably necessary (including the re-designation of its lending office pursuant to Section 2.18(a)) to avoid any requirement of applicable laws of any such jurisdiction that any Borrower make any deduction or withholding for taxes from amounts payable to such Lender. Notwithstanding any other provision of this paragraph, a Foreign Lender shall not be required to deliver any form pursuant to this paragraph that such Foreign Lender is not legally able to deliver. If a payment made to a Lender under any Loan Document would be subject to U.S. federal, Canadian or Cayman Tax imposed under FATCA if such Lender fails to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to the Withholding Agent such documentation as shall be reasonably requested by the Withholding Agent sufficient for the Withholding Agent to comply with its obligations under FATCA and to determine that such Lender has complied with such applicable reporting requirements. For purposes of determining Taxes imposed under FATCA, from and after the Amendment No. 2 Effective Date, the Borrower and the Administrative Agent shall treat (and the Lenders hereby authorize the Administrative Agent to treat) the Agreement as not qualifying as a “grandfathered obligation” with the meaning of Treasury Regulation Section 1.1471-2(b)(2)(i).”

2.05 Anti-Corruption Laws and Sanctions. Article IV of the Credit Agreement is hereby amended to add the following new Section 4.18:

“SECTION 4.18. Anti-Corruption Laws and Sanctions. The Obligors have implemented and maintain in effect policies and procedures designed to ensure compliance by the Obligors, their Subsidiaries and their respective directors, officers, employees and agents with Anti-Corruption Laws and applicable Sanctions, and each Obligor, its Subsidiaries and, to the knowledge of such Obligor or any such Subsidiary, its officers, employees, directors and agents, are in compliance with Anti-Corruption Laws and applicable Sanctions, except where the failure to do so, individually or in the aggregate, would not reasonably be expected to result in (a) a Material Adverse Effect or (b) any Lender violating any applicable Sanctions, and are not knowingly engaged in any

5

activity that would reasonably be expected to result in such Obligor being designated as a Sanctioned Person. None of (a) the Obligors, any Subsidiary nor, to the knowledge of any Obligor or any Subsidiary any of their respective directors, officers or employees, or (b) to the knowledge of each Obligor, any agent of such Obligor or any Subsidiary that will act in any capacity in connection with or benefit from the credit facility established hereby, is a Sanctioned Person or is the target of Sanctions. No Borrowing or Letter of Credit, use of proceeds or other transaction contemplated by the Agreement will violate Anti-Corruption Laws or applicable Sanctions”

2.06. Compliance with Laws. Section 6.07 of the Credit Agreement is hereby deleted and replaced in its entirety with the following:

“SECTION 6.07 Compliance with Laws. Each Obligor will, and will cause each of its Subsidiaries to, comply with all Requirements of Law (including, all Anti-Corruption Laws and applicable Sanctions) with respect to it, except where the failure to do so, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect. Each Obligor will maintain in effect and enforce policies and procedures designed to ensure compliance by the Obligors, its Subsidiaries and their respective directors, officers, employees and agents with Anti-Corruption Laws and applicable Sanctions, except where the failure to do so, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect.”

2.07. Minimum Management Fee Earnings Assets Amount. Section 7.08 of the Credit Agreement is hereby amended and restated in its entirety to read as follows:

“SECTION 7.08 Minimum Management Fee Earnings Assets Amount. Each Obligor will not permit the Management Fee Earning Assets Amount on any Quarterly Date commencing with the Quarterly Date occurring on the last Business Day of March 2015 to be less than $65,300,000,000.”

2.08. Use of Proceeds in Compliance with Sanctions Laws” of the Negative Covenants. Article VII of the Credit Agreement is hereby amended to add the following new Section 7.11:

“SECTION 7.11. Use of Proceeds in Compliance with Sanctions Laws. Each Borrower will not request any Borrowing or Letter of Credit, and each Obligor shall not use, and shall procure that its Subsidiaries and its or their respective directors, officers, employees and agents shall not use, the proceeds of any Borrowing or Letter of Credit (A) in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, directly or, to the knowledge of such Obligor, indirectly to any Person in violation of any Anti-Corruption Laws, (B) for the purpose of funding, financing or facilitating any activities, business or transaction of or with any Sanctioned Person, or in any Sanctioned Country, or (C) in any manner that would result in the violation of any Sanctions applicable to any party hereto.”

2.09     Commitment Amounts. Schedule 1 to the Credit Agreement is hereby amended and restated in its entirety to read as set forth on Schedule 1 hereto.

Section 3. Representations and Warranties. Each Credit Party represents and warrants to each Holder that immediately before and after giving effect to this Amendment No. 2

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(a) the representations and warranties set forth in Article IV of the Credit Agreement and in the other Loan Documents are true and correct in all material respects on the date hereof as if made on and as of the date hereof (or, if any such representation or warranty is expressly stated to have been made as of a specific date, such representation or warranty shall be true and correct in all material respects as of such specific date), and (b) no Default or Event of Default has occurred and is continuing.

Section 4. Conditions Precedent. The amendments set forth in Section 2 hereof shall become effective, as of the date hereof (the “Amendment No. 2 Effective Date”), upon the satisfaction of the following conditions precedent:

(a)    the Administrative Agent shall have received counterparts of this Amendment No. 2 executed by each Credit Party and each Lender party to the Credit Agreement;

(b)    the Borrowers shall have paid all fees and expenses of the Administrative Agent and the Lenders in connection with this Amendment No. 2 (including, without limitation, the invoiced fees and expenses of counsel to the Administrative Agent);

(c)    the Administrative Agent shall have received the following, in form and substance reasonably satisfactory to the Administrative Agent:

(i)    certified copies of the resolutions of the Board of Directors of each Credit Party approving the transactions contemplated by this Amendment No. 2 and the execution and delivery of this Amendment No. 2 and of all documents evidencing other necessary corporate action and governmental approvals, if any, with respect to this Amendment No. 2 or the Credit Agreement; and

(ii)    a certificate of the Secretary or an Assistant Secretary of each of the Credit Parties certifying the names and true signatures of the officers of such Credit Party authorized to sign this Amendment No. 2 and the other documents required to be delivered hereunder.

(d)the Administrative Agent shall have received evidence satisfactory to it that (x) all accrued and unpaid interest and commitment fees on the Loans and Commitments under the Credit Agreement owing to each Lender shall have been (or shall simultaneously be) paid in full, and (y) the outstanding principal amount of the Loans and all other amounts owing under or in respect of, the Credit Agreement to any Retiring Lender shall have been (or shall simultaneously be) paid in full; and

(e)each of the actions set forth in Section 5 shall have occurred.

Section 5. Retiring Lenders and Reallocation.

(a)If any Revolving Credit Loans or Letters of Credit shall be outstanding immediately prior to the Amendment No. 2 Effective Date, the Borrowers shall borrow Revolving Credit Loans from the Revolving Credit Lenders, and the Revolving Credit Lenders shall make Revolving Credit Loans to the Borrowers (in the case of Eurocurrency Revolving Credit Loans, having the same Interest Periods and LIBO Rates as any then outstanding Eurocurrency

7

Revolving Credit Loans) and shall be deemed to have acquired participations of the Revolving Credit Lenders in any Letters of Credit that are outstanding immediately prior to the Amendment No. 2 Effective Date, and (notwithstanding the provisions of Section 2.17 requiring that borrowings and prepayments be made ratably in accordance with the principal amounts of the Revolving Credit Loans held by the Revolving Credit Lenders) the Borrowers shall repay in full the principal and all accrued and unpaid interest on all of the Revolving Credit Loans made by the Retiring Lenders to the Borrowers hereunder (together with all accrued and unpaid commitment fees and any other amounts payable hereunder to such Retiring Lender in connection with their respective “Revolving Credit Commitments” under (and as defined in) the Credit Agreement) and the Borrowers to the extent necessary shall repay the principal of the Revolving Credit Loans made by the Revolving Lenders to the Borrowers, in each case together with any amounts owing pursuant to Section 2.15 as a result of such payment, so that after giving effect to such Revolving Credit Loans, purchases and prepayments, the Revolving Credit Loans and LC Exposure in respect of all outstanding Letters of Credit shall be held by the Revolving Lenders ratably in accordance with the respective amounts of their Revolving Credit Commitments as of the Amendment No. 2 Effective Date as specified on Schedule 1 hereto and, in that connection, the Issuing Banks shall be deemed to have released the Retiring Lenders on such date to the extent of the respective purchases by the Revolving Credit Lenders. To effect the foregoing payments, the related transfers of funds shall be netted to the extent necessary to minimize the actual flows of funds between the relevant parties.

(b)With respect to the Term Loans outstanding immediately prior to the Amendment No. 2 Effective Date, the Borrowers shall borrow Term Loans from the Term Lenders, and the Term Lenders shall make Term Loans to the Borrowers (in the case of Eurocurrency Term Loans, having the same Interest Periods and LIBO Rates as any then outstanding Eurocurrency Term Loans), and (notwithstanding the provisions of Section 2.17 requiring that borrowings and prepayments be made ratably in accordance with the principal amounts of the Term Loans held by the Term Lenders) the Borrowers shall repay in full the principal of and all accrued and unpaid interest on all the Term Loans made by the Retiring Lenders to the Borrowers hereunder (together with any other amounts payable hereunder to such Retiring Lender in connection with their respective “Term Loans” under (and as defined in) the Credit Agreement) and the Borrowers to the extent necessary shall repay the principal of the Term Loans made by the Term Lenders to the Borrowers, in each case together with any amounts owing pursuant to Section 2.15 as a result of such payment, so that after giving effect to such Term Loans and prepayments, the Term Loans shall be held by the Term Lenders in the amounts set forth on Schedule 1. To effect the foregoing payments, the related transfers of funds shall be netted to the extent necessary to minimize the actual flows of funds between the relevant parties.

(c)Subject to the satisfaction of the conditions precedent specified in Section 4 above and the consummation of the transactions contemplated by Sections 5(a) and (b) above, but effective as of the Amendment No. 2 Effective Date, each Retiring Lender shall cease to be, and shall cease to have any of the rights and obligations of, a “Lender” under the Credit Agreement (except for those provisions that expressly provide for their survival for the benefit of the Lenders (including without limitation those provisions referred to in Section 10.03(b) of the Credit Agreement), which provisions shall survive and remain in full force and effect for the benefit of the Retiring Lenders), and each Retiring Lender shall not have any Revolving Credit Commitments or hold any Loans.

8

(d)The accrued interest to be paid by the Borrowers on the first Interest Payment Date occurring after the Amendment No. 2 Effective Date(accrued during the Interest Period in effect immediately prior to the Amendment No. 2 Effective Date and ending on the first Interest Payment Date occurring after the Amendment No. 2. Effective Date) shall be reduced by an amount equal to the accrued and unpaid interest paid to the Lenders on the Amendment No. 2 Effective Date, and accrued commitment fees to be paid by the Borrowers on the first Quarterly Date occurring after the Amendment No. 2 Effective Date shall be reduced by an amount equal to the accrued and unpaid commitment fees paid to the Lenders on the Amendment No. 2 Effective Date.

Section 6. Ratification of Obligations. Each Credit Party, by its execution of this Amendment No. 2, hereby (a) unconditionally confirms and ratifies that all of its obligations (including, without limitation, any guarantee obligations) under the Loan Documents to which it is a party shall continue uninterrupted and in full force and effect for the benefit of the Holders, (b) represents, warrants and agrees that on and after the date hereof, it will continue to obtain benefits from the incurrence of Loans to, and the issuance of Letters of Credit for the account of, the Borrowers, and (c) agrees that on and after the date hereof, all references in the Loan Documents to the “Credit Agreement” shall be deemed to be and are references to the Credit Agreement as amended hereby.

Section 7. Miscellaneous. Except as herein provided, the Credit Agreement shall remain unchanged and in full force and effect. This Amendment No. 2 is a Loan Document for all purposes of the Credit Agreement. This Amendment No. 2 may be executed in any number of counterparts, all of which taken together shall constitute one and the same amendatory instrument and any of the parties hereto may execute this Amendment No. 2 by signing any such counterpart. This Amendment No. 2 shall be governed by, and construed in accordance with, the law of the State of New York.

[Signature Pages Follow]

9

IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 2 to be duly executed and delivered as of the day and year first above written.

CREDIT PARTIES

BORROWERS

TC GROUP INVESTMENT HOLDINGS, L.P.

By: Carlyle Holdings II L.P., its general partner

By: /s/ Daniel A. D'AnielloName: Daniel A. D'Aniello
Title: Chairman

TC GROUP CAYMAN INVESTMENT HOLDINGS, L.P.

By: Carlyle Holdings II L.P., its general partner

By: /s/ Daniel A. D'Aniello
Name: Daniel A. D'Aniello
Title: Chairman

TC GROUP CAYMAN, L.P.

By: Carlyle Holdings III L.P., its general partner

By: /s/ Daniel A. D'Aniello
Name: Daniel A. D'Aniello
Title: Chairman

CARLYLE INVESTMENT MANAGEMENT, L.L.C.

By: /s/ Jeffrey W. Ferguson

Name: Jeffrey W. Ferguson

Title: General Counsel

Signature Page to Amendment No. 2 to The Carlyle Group Credit Agreement

PARENT GUARANTORS

TC GROUP, L.L.C.

By: Carlyle Holdings I L.P., its sole member

By: /s/ Daniel A. D'Aniello
Name: Daniel A. D'Aniello
Title: Chairman

CARLYLE HOLDINGS I L.P.

By: /s/ Daniel A. D'Aniello
Name: Daniel A. D'Aniello
Title: Chairman

CARLYLE HOLDINGS II L.P.

By: /s/ Daniel A. D'Aniello
Name: Daniel A. D'Aniello
Title: Chairman

CARLYLE HOLDINGS III L.P.

By: /s/ Daniel A. D'Aniello
Name: Daniel A. D'Aniello
Title: Chairman

Signature Page to Amendment No. 2 to The Carlyle Group Credit Agreement

SUBSIDIARY GUARANTORS

TC GROUP INVESTMENT HOLDINGS SUB L.P.

By: TC Group Investment Holdings, L.P., its general partner

By: Carlyle Holdings II L.P., its general partner

By: /s/ Daniel A. D'Aniello
Name: Daniel A. D'Aniello
Title: Chairman

TC GROUP CAYMAN INVESTMENT HOLDINGS SUB L.P.

By: TC Group Cayman Investment Holdings, L.P., its general partner

By: Carlyle Holdings II L.P., its general partner

By: /s/ Daniel A. D'Aniello
Name: Daniel A. D'Aniello
Title: Chairman

TC GROUP CAYMAN SUB L.P.

By: TC Group Cayman, L.P., its general partner

By: Carlyle Holdings III L.P., its general partner

By: /s/ Daniel A. D'Aniello
Name: Daniel A. D'Aniello
Title: Chairman

TC GROUP SUB L.P.

By: TC Group, L.L.C., its general partner

By: Carlyle Holdings I L.P., its sole member

By: /s/ Daniel A. D'Aniello
Name: Daniel A. D'Aniello
Title: Chairman

Signature Page to Amendment No. 2 to The Carlyle Group Credit Agreement

CARLYLE KNOX HOLDINGS, L.L.C.

By: /s/ Daniel A. D'Aniello

Name: Daniel A. D'Aniello

Title: Chairman and Managing Director

CARLYLE HOLDINGS FINANCE L.L.C.

By: /s/ Daniel A. D'Aniello

Name: Daniel A. D'Aniello

Title: Chairman

CARLYLE HOLDINGS II FINANCE L.L.C.

By: /s/ Daniel A. D'Aniello

Name: Daniel A. D'Aniello

Title: Chairman

Signature Page to Amendment No. 2 to The Carlyle Group Credit Agreement

LENDERS

CITIBANK, N.A.

By /s/ Maureen Maroney
Name: Maureen Maroney
Title: Vice President

JPMORGAN CHASE BANK, N.A.

By /s/ Lauren Gubkin

Name: Lauren Gubkin

Title: Vice President

BANK OF AMERICA, N.A.

By /s/ Justin Smiley

Name: Justin Smiley

Title: Vice President

BARCLAYS BANK PLC

By /s/ Christopher R. Lee

Name: Christopher R. Lee

Title: Vice President

CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH

By /s/ John D. Toronto

Name: John D. Toronto

Title: Authorized Signatory

By /s/ Whitney Gaston

Name: Whitney Gaston

Title: Authorized Signatory

Signature Page to Amendment No. 2 to The Carlyle Group Credit Agreement

DEUTSCHE BANK AG NEW YORK BRANCH

By /s/ Michael Winters

Name: Michael Winters

Title: Vice President

By /s/ Kirk L. Tashjian

Name: Kirk L. Tashjian

Title: Director

GOLDMAN SACHS BANK, USA

By /s/ Rebecca Kratz

Name: Rebecca Kratz

Title: Authorized Signatory

MORGAN STANLEY BANK, N.A.

By /s/ Michael King

Name: Michael King

Title: Authorized Signatory

SOCIETE GENERALE

By /s/ Shelley Yu

Name: Shelley Yu

Title: Director

UBS AG, Stamford Branch, as a Lender

By /s/ Denise Bushee

Name: Denise Bushee

Title: Associate Director

By /s/ Houssem Daly

Name: Houssem Daly

Title: Associate Director

Signature Page to Amendment No. 2 to The Carlyle Group Credit Agreement

RETIRING LENDERS

SILICON VALLEY BANK

By /s/ Ezra Barnehama

Name: Ezra Barnehama

Title: Vice President

Signature Page to Amendment No. 2 to The Carlyle Group Credit Agreement

Accepted and Acknowledged by:

CITIBANK, N.A.,

as Administrative Agent

By /s/ Maureen Maroney

Name: Maureen Maroney

Title: Vice President

Signature Page to Amendment No. 2 to The Carlyle Group Credit Agreement

SCHEDULE 1

Revolving Credit Commitments and Term Loans

	Revolving Credit Commitment	Term Loans	Total
Citibank, N.A.	$157,252,747.25	$5,833,333.32	$163,086,080.57
JPMorgan Chase Bank, N.A.	$159,368,131.87	$3,717,948.71	$163,086,080.58
Credit Suisse AG, Cayman Islands Branch	$159,368,131.87	$2,756,410.25	$162,124,542.12
Bank of America, N.A.	$43,200,549.45	$2,115,384.62	$45,315,934.07
Barclays Bank PLC	$43,200,549.45	$2,115,384.62	$45,315,934.07
Deutsche Bank AG New York Branch	$43,200,549.45	$2,115,384.62	$45,315,934.07
Goldman Sachs Bank, USA	$43,200,549.45	$2,115,384.62	$45,315,934.07
Morgan Stanley Bank, N.A.	$43,200,549.45	$2,115,384.62	$45,315,934.07
UBS AG, Stamford Branch	$45,315,934.07	$0	$45,315,934.07
Societe Generale	$12,692,308.69	$2,115,384.62	$14,807,692.31
TOTAL:	$750,000,000	$25,000,000	$775,000,000

EX-31.1

Exhibit 31.1

I, William E. Conway, Jr., certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the quarter ended March 31, 2015 of The Carlyle Group L.P.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 7, 2015

/s/ William E. Conway, Jr.

William E. Conway, Jr.

Co-Chief Executive Officer

Carlyle Group Management L.L.C.

(Co-Principal Executive Officer)

EX-31.2

Exhibit 31.2

I, Daniel A. D’Aniello, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the quarter ended March 31, 2015 of The Carlyle Group L.P.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 7, 2015

/s/ Daniel A. D’Aniello

Daniel A. D’Aniello

Chairman

Carlyle Group Management L.L.C.

(Co-Principal Executive Officer)

EX-31.3

Exhibit 31.3

I, David M. Rubenstein, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the quarter ended March 31, 2015 of The Carlyle Group L.P.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 7, 2015

/s/ David M. Rubenstein

David M. Rubenstein

Co-Chief Executive Officer

Carlyle Group Management L.L.C.

(Co-Principal Executive Officer)

EX-31.4

Exhibit 31.4

I, Curtis L. Buser, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the quarter ended March 31, 2015 of The Carlyle Group L.P.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 7, 2015

/s/ Curtis L. Buser

Curtis L. Buser

Chief Financial Officer

Carlyle Group Management L.L.C.

(Principal Financial Officer)

EX-32.1

Exhibit 32.1

Certification of the Co-Chief Executive Officer

Pursuant to 18 U.S.C. Section 1350,

As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report of The Carlyle Group L.P. (the “Company”) on Form 10-Q for the quarter ended March 31, 2015 filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, William E. Conway, Jr., Co-Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ William E. Conway, Jr.

William E. Conway, Jr.

Co-Chief Executive Officer

Carlyle Group Management L.L.C.

Date: May 7, 2015

* The foregoing certification is being furnished solely pursuant to 18 U.S.C. Section 1350 and is not being filed as part of the Report or as a separate disclosure document.

EX-32.2

Exhibit 32.2

Certification of the Chairman

Pursuant to 18 U.S.C. Section 1350,

As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report of The Carlyle Group L.P. (the “Company”) on Form 10-Q for the quarter ended March 31, 2015 filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Daniel A. D’Aniello, Chairman of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Daniel A. D’Aniello

Daniel A. D'Aniello

Chairman

Carlyle Group Management L.L.C.

Date: May 7, 2015

* The foregoing certification is being furnished solely pursuant to 18 U.S.C. Section 1350 and is not being filed as part of the Report or as a separate disclosure document.

EX-32.3

Exhibit 32.3

Certification of the Co-Chief Executive Officer

Pursuant to 18 U.S.C. Section 1350,

As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report of The Carlyle Group L.P. (the “Company”) on Form 10-Q for the quarter ended March 31, 2015 filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, David M. Rubenstein, Co-Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ David M. Rubenstein

David M. Rubenstein

Co-Chief Executive Officer

Carlyle Group Management L.L.C.

Date: May 7, 2015

* The foregoing certification is being furnished solely pursuant to 18 U.S.C. Section 1350 and is not being filed as part of the Report or as a separate disclosure document.

EX-32.4

Exhibit 32.4

Certification of the Chief Financial Officer

Pursuant to 18 U.S.C. Section 1350,

As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report of The Carlyle Group L.P. (the “Company”) on Form 10-Q for the quarter ended March 31, 2015 filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Curtis L. Buser, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Curtis L. Buser

Curtis L. Buser

Chief Financial Officer

Carlyle Group Management L.L.C.

Date: May 7, 2015

* The foregoing certification is being furnished solely pursuant to 18 U.S.C. Section 1350 and is not being filed as part of the Report or as a separate disclosure document.

XML

Non-controlling Interests in Consolidated Entities (Tables)

3 Months Ended

Mar. 31, 2015

Noncontrolling Interest [Abstract]

Components of Partnership's non-controlling interests in consolidated entities

The components of the Partnership’s non-controlling interests in consolidated entities are as follows:

	As of
	March 31, 2015			December 31, 2014
	(Dollars in millions)
Non-Carlyle interests in Consolidated Funds	$	5,655.8		$	6,160.1
Non-Carlyle interests in majority-owned subsidiaries	323.6			301.4
Non-controlling interest in carried interest and cash held for carried interest distributions	(53.7		)	(15.1		)
Non-controlling interests in consolidated entities	$	5,925.7		$	6,446.4

Components of Partnership's non-controlling interests in income (loss) of consolidated entities

The components of the Partnership’s non-controlling interests in income (loss) of consolidated entities are as follows:

	Three Months Ended March 31,
	2015			2014
	(Dollars in millions)
Non-Carlyle interests in Consolidated Funds	$	449.9		$	352.9
Non-Carlyle interests in majority-owned subsidiaries	(0.8		)	(21.3		)
Non-controlling interest in carried interest and cash held for carried interest distributions	(37.9		)	8.0
Net income attributable to other non-controlling interests in consolidated entities	411.2			339.6
Net loss attributable to partners’ capital appropriated for CLOs	(48.6		)	(82.1		)
Net income attributable to redeemable non-controlling interests in consolidated entities	76.5			67.0
Non-controlling interests in income of consolidated entities	$	439.1		$	324.5

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Supplemental Financial Information - Supplemental Statement of Cash Flows (Additional Information) (Details) (5.625% Senior Notes Due 3/30/2043)	Mar. 31, 2015	Dec. 31, 2014
5.625% Senior Notes Due 3/30/2043
Condensed Cash Flow Statements, Captions [Line Items]
Senior notes percentage	5.625%	5.625%

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Fair Value Measurement - Partnership's Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	$ 25,982.1	$ 26,044.7
Loans payable of Consolidated Funds	16,554.6	16,052.2
Derivative instruments of the CLOs	27.4	17.2
Contingent consideration	51.3	51.1
Loans payable of a consolidated real estate VIE	139.6	146.2
Interest rate swaps	2.6	3.2
Foreign currency forward contracts	8.8
Total Liabilities	16,784.3	16,269.9
Equity securities
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	2,100.0	2,472.1
Bonds
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	1,149.3	1,235.8
Loans
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	15,439.4	15,084.9
Partnership and LLC interests
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	3,324.8	3,481.0
Hedge funds
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	3,932.3	3,753.5
Other
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	3.3	1.5
Investments of Consolidated Funds
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	25,949.1	26,028.8
Trading securities
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	2.2	3.3
Foreign currency forward contracts
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	14.1
Restricted securities of Consolidated Funds
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	16.7	12.6
Level I
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	605.2	350.8
Loans payable of Consolidated Funds	0	0
Derivative instruments of the CLOs	0	0
Contingent consideration	0	0
Loans payable of a consolidated real estate VIE	0	0
Interest rate swaps	0	0
Foreign currency forward contracts	0
Total Liabilities	0	0
Level I | Equity securities
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	601.1	346.8
Level I | Bonds
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	0	0
Level I | Loans
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	0	0
Level I | Partnership and LLC interests
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	0	0
Level I | Hedge funds
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	0	0
Level I | Other
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	0	0
Level I | Investments of Consolidated Funds
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	601.1	346.8
Level I | Trading securities
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	0	0
Level I | Foreign currency forward contracts
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	0
Level I | Restricted securities of Consolidated Funds
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	4.1	4.0
Level II
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	4,052.0	3,910.3
Loans payable of Consolidated Funds	0	0
Derivative instruments of the CLOs	0	0
Contingent consideration	0	0
Loans payable of a consolidated real estate VIE	0	0
Interest rate swaps	2.6	3.2
Foreign currency forward contracts	8.8
Total Liabilities	11.4	3.2
Level II | Equity securities
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	105.6	156.8
Level II | Bonds
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	0	0
Level II | Loans
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	0	0
Level II | Partnership and LLC interests
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	0	0
Level II | Hedge funds
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	3,932.3	3,753.5
Level II | Other
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	0	0
Level II | Investments of Consolidated Funds
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	4,037.9	3,910.3
Level II | Trading securities
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	0	0
Level II | Foreign currency forward contracts
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	14.1
Level II | Restricted securities of Consolidated Funds
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	0	0
Level III
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	21,324.9	21,783.6
Loans payable of Consolidated Funds	16,554.6	16,052.2
Derivative instruments of the CLOs	27.4	17.2
Contingent consideration	51.3	51.1
Loans payable of a consolidated real estate VIE	139.6	146.2
Interest rate swaps	0	0
Foreign currency forward contracts	0
Total Liabilities	16,772.9	16,266.7
Level III | Equity securities
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	1,393.3	1,968.5
Level III | Bonds
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	1,149.3	1,235.8
Level III | Loans
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	15,439.4	15,084.9
Level III | Partnership and LLC interests
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	3,324.8	3,481.0
Level III | Hedge funds
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	0	0
Level III | Other
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	3.3	1.5
Level III | Investments of Consolidated Funds
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	21,310.1	21,771.7
Level III | Trading securities
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	2.2	3.3
Level III | Foreign currency forward contracts
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	0
Level III | Restricted securities of Consolidated Funds
Assets And Liabilities Carrying Value And Fair Value [Line Items]
Assets	$ 12.6	$ 8.6

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Summary of Significant Accounting Policies - Revenue Recognition (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014	Dec. 31, 2014
Fund Management Fees
Period of time for which management fees will be received by partners from the initial closing date (in years)	10 years
Subsequent period in which management fees are recognized after these fees are called (in months)	6 months
Transaction and advisory fees	$ 7.6	$ 7.0
Performance Fees
Performance fees allocation percentage to partnership	20.00%
Accrued giveback obligations	176.6		104.4
Interest Income
Interest income of Consolidated Funds	$ 208.4	$ 221.2
Minimum
Fund Management Fees
Percentage of management fees earned	1.00%
Percentage of management fees earned on unrealized investments after termination of the investment period	0.60%
Extension period for fund closing (in years)	1 year
Percentage of management fees paid by hedge funds	1.50%
Percentage of management fees for business development companies	0.25%
Percentage of management fees for CLOs on the total par amount of assets in the fund	0.15%
Period of management fees related to Collateralized Loan Obligation (in years)	5 years
Percentage of management fees from fund of funds following the expiration of the weighted-average investment period	0.30%
Performance Fees
External coinvestment vehicles (as a percent)	10.00%
Percentage of allocation based performance fees related to fund of funds vehicles	2.00%
Percent of preferred returns	8.00%
Minimum | Private Equity And Real Estate Fund
Fund Management Fees
Percentage of management fees from funds of funds during the commitment fee period	0.30%
Minimum | Hedge funds
Fund Management Fees
Percentage of management fees from funds of funds during the commitment fee period	0.20%
Maximum
Fund Management Fees
Percentage of management fees earned	2.00%
Percentage of management fees earned on unrealized investments after termination of the investment period	2.00%
Extension period for fund closing (in years)	2 years
Percentage of management fees paid by hedge funds	2.00%
Percentage of management fees for business development companies	1.00%
Percentage of management fees for CLOs on the total par amount of assets in the fund	1.00%
Period of management fees related to Collateralized Loan Obligation (in years)	10 years
Percentage of management fees from fund of funds following the expiration of the weighted-average investment period	1.00%
Performance Fees
External coinvestment vehicles (as a percent)	20.00%
Percentage of allocation based performance fees related to fund of funds vehicles	10.00%
Percent of preferred returns	9.00%
Maximum | Private Equity And Real Estate Fund
Fund Management Fees
Percentage of management fees from funds of funds during the commitment fee period	1.00%
Maximum | Hedge funds
Fund Management Fees
Percentage of management fees from funds of funds during the commitment fee period	1.50%

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Investments - Net Investment Gains (Losses) of Consolidated Funds (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Equity Method Investments and Joint Ventures [Abstract]
Gains from investments of Consolidated Funds	$ 560.5	$ 488.9
Losses from liabilities of CLOs	(55.5)	(65.1)
Gains on other assets of CLOs	0.5	0.2
Total	$ 505.5	$ 424.0

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Fair Value Measurement - Additional Information (Details)	3 Months Ended
	Mar. 31, 2015
Fair Value Disclosures [Abstract]
Maximum lag period for which the partnership investments in funds are valued	90 days

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Borrowings - Outstanding Loans Payable of Consolidated Funds (Details) (USD $)	3 Months Ended	12 Months Ended
	Mar. 31, 2015	Dec. 31, 2014
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Borrowing Outstanding	$ 16,786,300,000	$ 16,361,500,000
Fair Value	16,554,600,000	16,052,200,000
Senior secured notes
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Borrowing Outstanding	15,528,100,000	15,104,200,000
Fair Value	15,264,800,000	14,757,500,000
Weighted Average Interest Rate (as a percent)	1.70%	1.68%
Weighted Average Remaining Maturity in Years	9 years 2 months 1 day	9 years 2 months 16 days
Subordinated notes and preferred shares
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Borrowing Outstanding	1,238,200,000	1,242,300,000
Fair Value	1,268,600,000	1,278,800,000
Weighted Average Remaining Maturity in Years	8 years 2 months 16 days	8 years 3 months 11 days
Combination notes
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Borrowing Outstanding	20,000,000	15,000,000
Fair Value	$ 21,200,000	$ 15,900,000
Weighted Average Remaining Maturity in Years	8 years 2 months 9 days	7 years 1 month 21 days

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Segment Reporting - Expenses Adjustment Represents Elimination of Intercompany Expenses (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Segment Reporting Information [Line Items]
Equity-based compensation issued in conjunction with the initial public offering, acquisitions and strategic investments	$ 59.0	$ 62.4
Acquisition related charges and amortization of intangibles	40.6	80.1
Other non-operating expense	1.1	30.2
Tax expense associated with performance fee compensation	(5.2)	(10.2)
Total expenses	1,027.0	1,099.0
Reconciling Items
Segment Reporting Information [Line Items]
Equity-based compensation issued in conjunction with the initial public offering, acquisitions and strategic investments	59.0	62.4
Acquisition related charges and amortization of intangibles	40.6	80.1
Other non-operating expense	1.1	30.2
Tax expense associated with performance fee compensation	(5.2)	(10.2)
Non-Carlyle economic interests in acquired business	80.3	85.5
Other adjustments	1.2	2.3
Elimination of expenses of Consolidated Funds	55.0	75.9
Total expenses	$ 122.0	$ 174.4

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Summary of Significant Accounting Policies - Principles of Consolidation (Details) (USD $)	Mar. 31, 2015
Variable Interest Entity [Line Items]
Consolidated VIEs, assets	$ 24,200,000,000
Consolidated VIEs, liabilities	18,300,000,000
Collateralized Loan Obligations
Variable Interest Entity [Line Items]
Investments in CLOs	$ 169,300,000

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Intangible Assets and Goodwill (Tables)

3 Months Ended

Mar. 31, 2015

Goodwill and Intangible Assets Disclosure [Abstract]

Carrying amount of intangible assets

The following table summarizes the carrying amount of intangible assets as of March 31, 2015 and December 31, 2014:

	As of
	March 31, 2015			December 31, 2014
	(Dollars in millions)
Acquired contractual rights	$	832.1		$	843.0
Acquired trademarks	6.6			6.7
Accumulated amortization	(485.2		)	(455.1		)
Finite-lived intangible assets, net	353.5			394.6
Goodwill	45.8			47.5
Intangible assets, net	$	399.3		$	442.1

Carrying amount of goodwill by segment

The following table summarizes the changes in the carrying amount of goodwill by segment as of March 31, 2015. There was no goodwill associated with the Partnership’s Corporate Private Equity and Real Assets segments.

	Global Market Strategies		Investment Solutions			Total
	(Dollars in millions)
Balance as of December 31, 2014	$	28.0	$	19.5		$	47.5
Foreign currency translation	—		(1.7		)	(1.7		)
Balance as of March 31, 2015	$	28.0	$	17.8		$	45.8

Summary of expected amortization expense

The following table summarizes the expected amortization expense for April 1, 2015 through 2019 and thereafter (Dollars in millions):

2015	$	61.0
2016	68.7
2017	65.6
2018	58.5
2019	48.4
Thereafter	51.3
	$	353.5

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Contingent Consideration - Changes in Contingent Consideration Liabilities (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Loss Contingency Accrual [Roll Forward]
Balance, beginning of period	$ 384.6	$ 350.3
Change in carrying value	16.8	45.9
Payments	(3.8)	(72.7)
Issuances of equity	(2.2)
Balance, end of period	395.4	323.5
Barclays Natural Resource Investments
Loss Contingency Accrual [Roll Forward]
Change in carrying value of contingent consideration obligation for Barclays	23.2
Carlyle Consolidated | Performance-based | Contingent cash consideration
Loss Contingency Accrual [Roll Forward]
Balance, beginning of period	26.8	145.1
Change in carrying value	0.7	17.0
Payments	0	(70.5)
Issuances of equity	0
Balance, end of period	27.5	91.6
Carlyle Consolidated | Performance-based | Contingent equity consideration
Loss Contingency Accrual [Roll Forward]
Balance, beginning of period	0	15.7
Change in carrying value	0	10.6
Payments	0	0
Issuances of equity	0
Balance, end of period	0	26.3
Carlyle Consolidated | Employment-based | Contingent cash consideration
Loss Contingency Accrual [Roll Forward]
Balance, beginning of period	156.8	148.7
Change in carrying value	(9.5)	13.1
Payments	(3.3)	0
Issuances of equity	(2.2)
Balance, end of period	141.8	161.8
Non-Carlyle personnel
Loss Contingency Accrual [Roll Forward]
Balance, beginning of period	201.0	40.8
Change in carrying value	25.6	5.2
Payments	(0.5)	(2.2)
Issuances of equity	0
Balance, end of period	$ 226.1	$ 43.8

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Intangible Assets and Goodwill - Carrying Amount of Goodwill, by Segment (Details) (USD $)	3 Months Ended
	Mar. 31, 2015
Goodwill [Roll Forward]
Balance at beginning of period	$ 47,500,000
Foreign currency translation	(1,700,000)
Balance at end of period	45,800,000
Global Market Strategies
Goodwill [Roll Forward]
Balance at beginning of period	28,000,000
Foreign currency translation	0
Balance at end of period	28,000,000
Investment Solutions
Goodwill [Roll Forward]
Balance at beginning of period	19,500,000
Foreign currency translation	(1,700,000)
Balance at end of period	$ 17,800,000

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Non-controlling Interests in Consolidated Entities - Partnership's Non-Controlling Interests in Consolidated Entities (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Noncontrolling Interest [Line Items]
Non-controlling interests in consolidated entities	$ 5,925.7	$ 6,446.4
Non-Carlyle interests in Consolidated Funds
Noncontrolling Interest [Line Items]
Non-controlling interests in consolidated entities	5,655.8	6,160.1
Non-Carlyle interests in majority-owned subsidiaries
Noncontrolling Interest [Line Items]
Non-controlling interests in consolidated entities	323.6	301.4
Non-controlling interest in carried interest and cash held for carried interest distributions
Noncontrolling Interest [Line Items]
Non-controlling interests in consolidated entities	$ (53.7)	$ (15.1)

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Fair Value Measurement - Transfer Out of Level lll of Financial Liabilities (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Balance, beginning of period	$ 16,266.7	$ 15,534.7
Initial consolidation of funds	664.4	720.4
Borrowings	947.1	634.2
Paydowns	(557.9)	(1,041.0)
Sales	(0.8)	(0.9)
Included in earnings	78.5	102.2
Included in other comprehensive income	(625.1)	(5.1)
Balance, end of period	16,772.9	15,944.5
Changes in unrealized (gains) losses included in earnings related to financial liabilities still held at the reporting date	46.2	4.3
Loans Payable of Consolidated Funds
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Balance, beginning of period	16,052.2	15,220.7
Initial consolidation of funds	664.4	720.4
Borrowings	939.3	624.6
Paydowns	(538.5)	(949.2)
Sales	0	0
Included in earnings	55.8	69.9
Included in other comprehensive income	(618.6)	(7.7)
Balance, end of period	16,554.6	15,678.7
Changes in unrealized (gains) losses included in earnings related to financial liabilities still held at the reporting date	46.4	(23.3)
Derivative Instruments of Consolidated Funds
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Balance, beginning of period	17.2	13.1
Initial consolidation of funds	0	0
Borrowings	0	0
Paydowns	0	0
Sales	(0.8)	(0.9)
Included in earnings	9.0	2.5
Included in other comprehensive income	2.0	0
Balance, end of period	27.4	14.7
Changes in unrealized (gains) losses included in earnings related to financial liabilities still held at the reporting date	(13.9)	(1.6)
Contingent Consideration
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Balance, beginning of period	51.1	178.8
Initial consolidation of funds	0	0
Borrowings	0	0
Paydowns	(0.5)	(72.7)
Sales	0	0
Included in earnings	0.7	19.7
Included in other comprehensive income	0	0
Balance, end of period	51.3	125.8
Changes in unrealized (gains) losses included in earnings related to financial liabilities still held at the reporting date	0.7	19.1
Loans Payable of a consolidated real estate VIE
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Balance, beginning of period	146.2	122.1
Initial consolidation of funds	0	0
Borrowings	7.8	9.6
Paydowns	(18.9)	(19.1)
Sales	0	0
Included in earnings	13.0	10.1
Included in other comprehensive income	(8.5)	2.6
Balance, end of period	139.6	125.3
Changes in unrealized (gains) losses included in earnings related to financial liabilities still held at the reporting date	$ 13.0	$ 10.1

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Supplemental Financial Information - Supplemental Financial Position (Additional Information) (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Condensed Balance Sheet Statements, Captions [Line Items]
Principal amount	$ 214.8	$ 243.6
3.875% Senior Notes Due 2/01/2023
Condensed Balance Sheet Statements, Captions [Line Items]
Senior notes percentage	3.875%	3.875%
5.625% Senior Notes Due 3/30/2043
Condensed Balance Sheet Statements, Captions [Line Items]
Senior notes percentage	5.625%	5.625%
Consolidated Operating Entities
Condensed Balance Sheet Statements, Captions [Line Items]
Principal amount	$ 214.8	$ 243.6
Consolidated Operating Entities | 3.875% Senior Notes Due 2/01/2023
Condensed Balance Sheet Statements, Captions [Line Items]
Senior notes percentage	3.875%	3.875%
Consolidated Operating Entities | 5.625% Senior Notes Due 3/30/2043
Condensed Balance Sheet Statements, Captions [Line Items]
Senior notes percentage	5.625%	5.625%

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Borrowings - Partnership's Borrowings (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended	12 Months Ended
	Mar. 31, 2015	Dec. 31, 2014
Borrowings [Line Items]
Borrowing Outstanding	$ 1,138.4	$ 1,140.2
Carrying Value	1,145.1	1,146.9
Term Loan Due 8/09/2018
Borrowings [Line Items]
Borrowing Outstanding	25.0	25.0
Carrying Value	25.0	25.0
Loan maturity	Aug. 09, 2018	Aug. 09, 2018
Term Loan
Borrowings [Line Items]
Borrowing Outstanding	13.4	15.2
Carrying Value	13.4	15.2
Loan maturity	Sep. 28, 2018	Sep. 28, 2018
3.875% Senior Notes Due 2/01/2023
Borrowings [Line Items]
Borrowing Outstanding	500.0	500.0
Carrying Value	499.9	499.9
Loan maturity	Feb. 01, 2023	Feb. 01, 2023
Interest rate on senior notes (as a percent)	3.875%	3.875%
5.625% Senior Notes Due 3/30/2043
Borrowings [Line Items]
Borrowing Outstanding	600.0	600.0
Carrying Value	$ 606.8	$ 606.8
Loan maturity	Mar. 30, 2043	Mar. 30, 2043
Interest rate on senior notes (as a percent)	5.625%	5.625%

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Related Party Transactions - Due to Affiliates (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Related Party Transactions [Abstract]
Due to affiliates of Consolidated Funds	$ 0.2	$ 0.6
Due to non-consolidated affiliates	41.6	37.1
Performance-based contingent cash and equity consideration related to acquisitions	46.8	43.6
Amounts owed under the tax receivable agreement	88.1	89.0
Other	14.8	13.9
Total	$ 191.5	$ 184.2

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Accrued Compensation and Benefits (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Compensation and Retirement Disclosure [Abstract]
Accrued performance fee-related compensation	$ 1,808.4	$ 1,815.4
Accrued bonuses	127.7	229.6
Employment-based contingent cash consideration	141.8	156.8
Other	124.1	110.7
Total	$ 2,202.0	$ 2,312.5

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Related Party Transactions - Additional Information (Details) (USD $) In Millions, except Share data, unless otherwise specified	0 Months Ended	3 Months Ended
	Mar. 10, 2014	Mar. 31, 2015	Mar. 31, 2014
Related Party Transactions [Abstract]
Maximum percentage of interest on amounts due from affiliates		7.17%
Number of Carlyle Holdings partnership units acquired from Carlyle Holdings limited partners	9,300,000		9,300,000
Payment of aircraft related expenses		$ 1.1	$ 1.5

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Borrowings - Additional Information (Details)	3 Months Ended				1 Months Ended	3 Months Ended			1 Months Ended			3 Months Ended			1 Months Ended	3 Months Ended			12 Months Ended	3 Months Ended			0 Months Ended	3 Months Ended
	Mar. 31, 2015 USD ($)	Mar. 31, 2014 USD ($)	Dec. 31, 2014 USD ($)	Mar. 31, 2013 USD ($)	Jan. 31, 2013 3.875% Senior Notes Due 2/01/2023 USD ($)	Mar. 31, 2015 3.875% Senior Notes Due 2/01/2023 USD ($)	Mar. 31, 2014 3.875% Senior Notes Due 2/01/2023 USD ($)	Dec. 31, 2014 3.875% Senior Notes Due 2/01/2023 USD ($)	Jan. 31, 2013 3.875% Senior Notes Due 2/01/2023 Treasury Rate	Mar. 31, 2014 5.625% Senior Notes Due 3/30/2043 USD ($)	Mar. 31, 2013 5.625% Senior Notes Due 3/30/2043 USD ($)	Mar. 31, 2015 5.625% Senior Notes Due 3/30/2043 USD ($)	Mar. 31, 2014 5.625% Senior Notes Due 3/30/2043 USD ($)	Dec. 31, 2014 5.625% Senior Notes Due 3/30/2043 USD ($)	Mar. 31, 2013 5.625% Senior Notes Due 3/30/2043 Treasury Rate	Mar. 31, 2015 Interest Rate Swap USD ($)	Mar. 31, 2015 Interest Rate Swaps Second USD ($)	Mar. 31, 2015 Term Loan Due 8/09/2018 USD ($)	Dec. 31, 2014 Term Loan Due 8/09/2018 USD ($)	Mar. 31, 2015 Term Loan Principal and Interest Due in Quarterly Installment	Mar. 31, 2015 Revolving Credit Facility	Mar. 31, 2013 Revolving Credit Facility USD ($)	Oct. 03, 2013 New Term Loan	Mar. 31, 2015 New Term Loan USD ($)	Oct. 03, 2013 New Term Loan EUR (€)
Total Debt [Line Items]
Maximum borrowing capacity in term loan	$ 500,000,000.0
Borrowing capacity	750,000,000.0
Loan maturity					Feb. 01, 2023					Mar. 30, 2043						Sep. 30, 2016		Aug. 09, 2018	Aug. 09, 2018	Aug. 09, 2018
Maximum percentage of applicable margin in addition to base rate																					0.75%
Maximum percentage of applicable margin																					1.75%
Actual percentage at period end																					1.43%
Term loan principal prepaid																						475,000,000.0
Maximum borrowing	1,138,400,000		1,140,200,000															25,000,000	25,000,000					13,400,000	12,600,000
Interest rate spread on term loan to fund investment in a CLO (as a percent)									30.00%						40.00%								1.75%
Actual percentage at period end for term loan that funded investment in CLO																								1.77%
Maturity period																							5 years
Senior notes principal amount					500,000,000.0					200,000,000.0	400,000,000.0		200,000,000.0
Interest rate on senior notes (as a percent)					3.875%					5.625%	5.625%		5.625%
Senior notes percentage of par value					99.966%					104.315%	99.583%		104.315%
Date of first required interest payment					Aug. 01, 2013						Sep. 30, 2013
Senior notes redemption terms percentage to principal amount					100.00%						100.00%
Interest expense	14,600,000	12,200,000				5,000,000	5,000,000					8,400,000	6,300,000
Fair value of notes payable						521,700,000		513,100,000				682,600,000		699,200,000
Aggregate principal amount	16,786,300,000		16,361,500,000							400,000,000.0			400,000,000.0
Notional amount																381,300,000.0	356,300,000.0
Accumulated other comprehensive loss related to cash flow hedges				8,800,000
Derivative maturity date																	Sep. 30, 2016
Fair value of collateralized loan obligation assets	$ 18,200,000,000		$ 17,600,000,000

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Investments - Realized and Unrealized Gains (Losses) Earned from Investments of Consolidated Funds (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Equity Method Investments and Joint Ventures [Abstract]
Realized gains	$ 224.6	$ 732.3
Net change in unrealized gains (losses)	335.9	(243.4)
Total	$ 560.5	$ 488.9

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Segment Reporting

3 Months Ended

Mar. 31, 2015

Segment Reporting [Abstract]

Segment Reporting

Segment Reporting

Carlyle conducts its operations through four reportable segments:

Corporate Private Equity – The Corporate Private Equity segment is comprised of the Partnership’s operations that advise a diverse group of funds that invest in buyout and growth capital transactions that focus on either a particular geography or a particular industry.

Global Market Strategies – The Global Market Strategies segment advises a group of funds that pursue investment opportunities across various types of credit, equities and alternative instruments, and (as regards certain macroeconomic strategies) currencies, commodities, sovereign debt, and interest rate products and their derivatives.

Real Assets – The Real Assets segment is comprised of the Partnership’s operations that advise U.S. and international funds focused on real estate, infrastructure, energy and renewable energy transactions.

Investment Solutions – The Investment Solutions segment advises a global private equity fund of funds program and related co-investment and secondary activities through AlpInvest. This segment also includes Metropolitan, a global manager of real estate fund of funds, and DGAM, the Partnership’s fund of hedge funds platform.

The Partnership’s reportable business segments are differentiated by their various investment focuses and strategies. Overhead costs are allocated based on direct base compensation expense for each segment. The Partnership includes adjustments to reflect the Partnership’s economic interests in Claren Road, ESG and Vermillion. The Partnership’s earnings from its investment in NGP Management are presented in the respective operating captions within the Real Assets segment. The net income or loss from the consolidation of Urbplan allocable to the Partnership (after consideration of amounts allocable to non-controlling interests) is presented within investment income in the Real Assets segment.

Economic Net Income (“ENI”) and its components are key performance measures used by management to make operating decisions and assess the performance of the Partnership’s reportable segments. ENI differs from income (loss) before provision for income taxes computed in accordance with U.S. GAAP in that it includes certain tax expenses associated with performance fee compensation, and does not include net income (loss) attributable to non-Carlyle interests in Consolidated Funds or charges (credits) related to Carlyle corporate actions and non-recurring items. Charges (credits) related to Carlyle corporate actions and non-recurring items include: charges associated with equity-based compensation that was issued in the initial public offering in May 2012 or is issued in acquisitions or strategic investments, amortization associated with acquired intangible assets, transaction costs associated with acquisitions, charges associated with earnouts and contingent consideration including gains and losses associated with the mark to market on contingent consideration issued in conjunction with acquisitions or strategic investments, gains and losses from the retirement of debt, charges associated with lease terminations and employee severance and settlements of legal claims.

Distributable earnings (“DE”) is a component of ENI and is used to assess performance and amounts potentially available for distribution. Distributable earnings differs from income (loss) before provision for income taxes computed in accordance with U.S. GAAP in that it adjusts for the items included in the calculation of ENI and also adjusts ENI for unrealized performance fees, unrealized investment income, the corresponding unrealized performance fee compensation expense and equity-based compensation.

Fee-related earnings (“FRE”) is a component of DE and is used to assess the ability of the business to cover direct base compensation and operating expenses from total fee revenues. FRE differs from income (loss) before provision for income taxes computed in accordance with U.S. GAAP in that it adjusts for the items included in the calculation of DE and also adjusts DE to exclude realized performance fees, realized investment income from investments in Carlyle funds, and realized performance fee related compensation.

ENI and its components are used by management primarily in making resource deployment and compensation decisions across the Partnership’s four reportable segments. Management makes operating decisions and assesses the performance of each of the Partnership’s business segments based on financial and operating metrics and data that is presented without the consolidation of any of the Consolidated Funds. Consequently, ENI and all segment data exclude the assets, liabilities and operating results related to the Consolidated Funds.

The following table presents the financial data for the Partnership’s four reportable segments as of and for the three months ended March 31, 2015:

	March 31, 2015 and the Three Months Then Ended
	Corporate Private Equity		Global Market Strategies			Real Assets			Investment Solutions		Total
	(Dollars in millions)
Segment Revenues
Fund level fee revenues
Fund management fees	$	134.3	$	55.5		$	66.3		$	40.5	$	296.6
Portfolio advisory fees, net	5.2		0.5			0.1			—		5.8
Transaction fees, net	1.5		—			0.3			—		1.8
Total fund level fee revenues	141.0		56.0			66.7			40.5		304.2
Performance fees
Realized	306.0		4.6			7.7			3.4		321.7
Unrealized	200.7		18.7			14.1			47.0		280.5
Total performance fees	506.7		23.3			21.8			50.4		602.2
Investment income (loss)
Realized	2.7		1.6			(86.4		)	0.1		(82.0		)
Unrealized	7.4		(4.2		)	50.2			0.6		54.0
Total investment income (loss)	10.1		(2.6		)	(36.2		)	0.7		(28.0		)
Interest and other income	3.2		1.8			1.1			0.4		6.5
Total revenues	661.0		78.5			53.4			92.0		884.9
Segment Expenses
Compensation and benefits
Direct base compensation	53.7		28.2			18.5			21.5		121.9
Indirect base compensation	26.3		8.8			12.3			3.6		51.0
Equity-based compensation	17.3		5.2			7.1			2.7		32.3
Performance fee related
Realized	137.0		2.3			1.8			2.2		143.3
Unrealized	95.7		8.2			28.9			44.3		177.1
Total compensation and benefits	330.0		52.7			68.6			74.3		525.6
General, administrative, and other indirect expenses	31.7		12.3			14.6			7.9		66.5
Depreciation and amortization expense	2.7		1.1			0.9			0.8		5.5
Interest expense	7.6		2.8			2.7			1.5		14.6
Total expenses	372.0		68.9			86.8			84.5		612.2
Economic Net Income (Loss)	$	289.0	$	9.6		$	(33.4	)	$	7.5	$	272.7
(-) Net Performance Fees	274.0		12.8			(8.9		)	3.9		281.8
(-) Investment Income (Loss)	10.1		(2.6		)	(36.2		)	0.7		(28.0		)
(+) Equity-based Compensation	17.3		5.2			7.1			2.7		32.3
(=) Fee Related Earnings	$	22.2	$	4.6		$	18.8		$	5.6	$	51.2
(+) Realized Net Performance Fees	169.0		2.3			5.9			1.2		178.4
(+) Realized Investment Income (Loss)	2.7		1.6			(86.4		)	0.1		(82.0		)
(=) Distributable Earnings	$	193.9	$	8.5		$	(61.7	)	$	6.9	$	147.6
Segment assets as of March 31, 2015	$	3,927.1	$	908.4		$	1,556.0		$	728.5	$	7,120.0

The following table presents the financial data for the Partnership’s four reportable segments for the three months ended March 31, 2014:

	Three Months Ended March 31, 2014
	Corporate Private Equity		Global Market Strategies		Real Assets			Investment Solutions		Total
	(Dollars in millions)
Segment Revenues
Fund level fee revenues
Fund management fees	$	129.8	$	63.2	$	50.3		$	44.5	$	287.8
Portfolio advisory fees, net	3.5		0.1		0.2			—		3.8
Transaction fees, net	3.2		—		—			—		3.2
Total fund level fee revenues	136.5		63.3		50.5			44.5		294.8
Performance fees
Realized	234.7		8.3		0.5			5.9		249.4
Unrealized	212.9		49.5		14.0			79.3		355.7
Total performance fees	447.6		57.8		14.5			85.2		605.1
Investment income (loss)
Realized	1.9		1.3		2.1			—		5.3
Unrealized	5.4		1.9		(20.6		)	0.1		(13.2		)
Total investment income (loss)	7.3		3.2		(18.5		)	0.1		(7.9		)
Interest and other income	2.2		1.3		0.7			0.3		4.5
Total revenues	593.6		125.6		47.2			130.1		896.5
Segment Expenses
Compensation and benefits
Direct base compensation	59.5		27.5		18.7			21.0		126.7
Indirect base compensation	22.0		6.0		14.3			3.8		46.1
Equity-based compensation	7.1		2.7		3.5			0.7		14.0
Performance fee related
Realized	101.3		3.8		0.2			4.0		109.3
Unrealized	100.5		14.8		8.4			75.7		199.4
Total compensation and benefits	290.4		54.8		45.1			105.2		495.5
General, administrative, and other indirect expenses	35.4		11.6		15.5			9.2		71.7
Depreciation and amortization expense	2.7		0.9		0.9			0.9		5.4
Interest expense	6.7		2.1		2.2			1.2		12.2
Total expenses	335.2		69.4		63.7			116.5		584.8
Economic Net Income (Loss)	$	258.4	$	56.2	$	(16.5	)	$	13.6	$	311.7
(-) Net Performance Fees	245.8		39.2		5.9			5.5		296.4
(-) Investment Income (Loss)	7.3		3.2		(18.5		)	0.1		(7.9		)
(+) Equity-based Compensation	7.1		2.7		3.5			0.7		14.0
(=) Fee Related Earnings	$	12.4	$	16.5	$	(0.4	)	$	8.7	$	37.2
(+) Realized Net Performance Fees	133.4		4.5		0.3			1.9		140.1
(+) Realized Investment Income	1.9		1.3		2.1			—		5.3
(=) Distributable Earnings	$	147.7	$	22.3	$	2.0		$	10.6	$	182.6

The following table reconciles the Total Segments to the Partnership’s Income Before Provision for Taxes as of and for the three months ended March 31, 2015:

	March 31, 2015 and the Three Months Then Ended
	Total Reportable Segments		Consolidated Funds		Reconciling Items				Carlyle Consolidated
	(Dollars in millions)
Revenues	$	884.9	$	226.3	$	25.6		(a)	$	1,136.8
Expenses	$	612.2	$	292.8	$	122.0		(b)	$	1,027.0
Other income	$	—	$	507.8	$	(2.3	)	(c)	$	505.5
Economic net income	$	272.7	$	441.3	$	(98.7	)	(d)	$	615.3
Total assets	$	7,120.0	$	28,096.6	$	(203.4	)	(e)	$	35,013.2

The following table reconciles the Total Segments to the Partnership’s Income Before Provision for Taxes for the three months ended March 31, 2014:

	Three Months Ended March 31, 2014
	Total Reportable Segments		Consolidated Funds		Reconciling Items				Carlyle Consolidated
	(Dollars in millions)
Revenues	$	896.5	$	250.7	$	0.2		(a)	$	1,147.4
Expenses	$	584.8	$	339.8	$	174.4		(b)	$	1,099.0
Other income	$	—	$	426.9	$	(2.9	)	(c)	$	424.0
Economic net income	$	311.7	$	337.8	$	(177.1	)	(d)	$	472.4

(a) The Revenues adjustment principally represents fund management and performance fees earned from the Consolidated Funds which were eliminated in consolidation to arrive at the Partnership’s total revenues, adjustments for amounts attributable to non-controlling interests in consolidated entities, adjustments related to expenses associated with the investments in NGP Management and its affiliates that are included in operating captions or are excluded from the segment results, adjustments to reflect the Partnership’s share of Urbplan’s net losses as a component of investment income, and adjustments to reflect the Partnership’s ownership interests in Claren Road, ESG and Vermillion that were included in Revenues in the Partnership’s segment reporting.

(b) The Expenses adjustment represents the elimination of intercompany expenses of the Consolidated Funds payable to the Partnership, the inclusion of certain tax expenses associated with performance fee compensation, adjustments related to expenses associated with the investment in NGP Management that are included in operating captions, adjustments to reflect the Partnership’s share of Urbplan’s net losses as a component of investment income, charges and credits associated with Carlyle corporate actions and non-recurring items and adjustments to reflect the Partnership’s economic interests in Claren Road, ESG and Vermillion, as detailed below (Dollars in millions):

	Three Months Ended March 31,
	2015			2014
Equity-based compensation issued in conjunction with the initial public offering, acquisitions and strategic investments	$	59.0		$	62.4
Acquisition related charges and amortization of intangibles	40.6			80.1
Other non-operating expense	1.1			30.2
Tax expense associated with performance fee compensation	(5.2		)	(10.2		)
Non-Carlyle economic interests in acquired business	80.3			85.5
Other adjustments	1.2			2.3
Elimination of expenses of Consolidated Funds	(55.0		)	(75.9		)
	$	122.0		$	174.4

(c) The Other Income (Loss) adjustment results from the Consolidated Funds which were eliminated in consolidation to arrive at the Partnership’s total Other Income (Loss).

(d) The following table is a reconciliation of Income Before Provision for Income Taxes to Economic Net Income, to Fee Related Earnings, and to Distributable Earnings (Dollars in millions):

	Three Months Ended March 31,
	2015			2014
Income before provision for income taxes	$	615.3		$	472.4
Adjustments:
Equity-based compensation issued in conjunction with the initial public offering, acquisitions and strategic investments	59.0			62.4
Acquisition related charges and amortization of intangibles	40.6			80.1
Other non-operating expense	1.1			30.2
Tax expense associated with performance fee compensation	(5.2		)	(10.2		)
Net income attributable to non-controlling interests in Consolidated entities	(439.1		)	(324.5		)
Other adjustments	1.0			1.3
Economic Net Income	$	272.7		$	311.7
Net performance fees(1)	281.8			296.4
Investment loss(1)	(28.0		)	(7.9		)
Equity-based compensation	32.3			14.0
Fee Related Earnings	$	51.2		$	37.2
Realized performance fees, net of related compensation	178.4			140.1
Realized investment income (loss)(1)	(82.0		)	5.3
Distributable Earnings	$	147.6		$	182.6

(1) See reconciliation to most directly comparable U.S. GAAP measure below:

	Three Months Ended March 31, 2015
	Carlyle Consolidated			Adjustments (2)			Total Reportable Segments
	(Dollars in millions)
Performance fees
Realized	$	326.8		$	(5.1	)	$	321.7
Unrealized	246.2			34.3			280.5
Total performance fees	573.0			29.2			602.2
Performance fee related compensation expense
Realized	143.0			0.3			143.3
Unrealized	173.7			3.4			177.1
Total performance fee related compensation expense	316.7			3.7			320.4
Net performance fees
Realized	183.8			(5.4		)	178.4
Unrealized	72.5			30.9			103.4
Total net performance fees	$	256.3		$	25.5		$	281.8
Investment income (loss)
Realized	$	8.9		$	(90.9	)	$	(82.0	)
Unrealized	(2.1		)	56.1			54.0
Investment income (loss)	$	6.8		$	(34.8	)	$	(28.0	)

	Three Months Ended March 31, 2014
	Carlyle Consolidated		Adjustments (2)			Total Reportable Segments
	(Dollars in millions)
Performance fees
Realized	$	251.4	$	(2.0	)	$	249.4
Unrealized	369.1		(13.4		)	355.7
Total performance fees	620.5		(15.4		)	605.1
Performance fee related compensation expense
Realized	108.7		0.6			109.3
Unrealized	221.6		(22.2		)	199.4
Total performance fee related compensation expense	330.3		(21.6		)	308.7
Net performance fees
Realized	142.7		(2.6		)	140.1
Unrealized	147.5		8.8			156.3
Total net performance fees	$	290.2	$	6.2		$	296.4
Investment income (loss)
Realized	$	—	$	5.3		$	5.3
Unrealized	6.1		(19.3		)	(13.2		)
Total investment income (loss)	$	6.1	$	(14.0	)	$	(7.9	)

(2) Adjustments to performance fees and investment income (loss) relate to (i) amounts earned from the Consolidated Funds, which were eliminated in the U.S. GAAP consolidation but were included in the segment results, (ii) amounts attributable to non-controlling interests in consolidated entities, which were excluded from the segment results and (iii) the reclassification of NGP X performance fees, which are included in investment income in U.S. GAAP financial statements. Adjustments to investment income (loss) also include the reclassification of earnings for the investments in NGP Management and its affiliates to the appropriate operating captions for the segment results, the exclusion of charges associated with the investment in NGP Management and its affiliates that are excluded from the segment results, and adjustments to reflect the Partnership’s share of Urbplan’s net losses as investment losses for the segment results. Adjustments to performance fee related compensation expense relate to certain tax expenses associated with performance fee compensation. Adjustments are also included in these financial statement captions to reflect the Partnership’s 55% economic interest in each of Claren Road, ESG and Vermillion.

(e) The Total Assets adjustment represents the addition of the assets of the Consolidated Funds that were eliminated in consolidation to arrive at the Partnership’s total assets.

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Summary of Significant Accounting Policies - Intangible Assets and Goodwill (Details)	3 Months Ended
	Mar. 31, 2015
Minimum
Finite-Lived Intangible Assets [Line Items]
Estimated useful life of finite lived intangible assets (in years)	3 years
Maximum
Finite-Lived Intangible Assets [Line Items]
Estimated useful life of finite lived intangible assets (in years)	10 years

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Consolidation of a Real Estate Development Company (Tables)

3 Months Ended

Mar. 31, 2015

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Assets and liabilities recognized in the Partnership’s condensed consolidated balance sheets

The assets and liabilities recognized in the Partnership’s condensed consolidated balance sheets as of March 31, 2015 and December 31, 2014 related to Urbplan were as follows:

	As of
	March 31, 2015		December 31, 2014
	(Dollars in millions)
Receivables and inventory of a consolidated real estate VIE:
Customer and other receivables	$	106.4	$	91.5
Inventory costs in excess of billings and advances	78.6		72.4
	$	185.0	$	163.9
Other assets of a consolidated real estate VIE:
Restricted investments	$	34.1	$	36.8
Fixed assets, net	1.4		1.8
Deferred tax assets	10.0		12.9
Other assets	28.2		34.9
	$	73.7	$	86.4
Loans payable of a consolidated real estate VIE, at fair value (principal amount of $214.8 million and $243.6 million as of March 31, 2015 and December 31, 2014, respectively)	$	139.6	$	146.2
Other liabilities of a consolidated real estate VIE:
Accounts payable	$	23.2	$	26.1
Other liabilities	82.2		58.8
	$	105.4	$	84.9

Revenues and expenses recognized in the Partnership’s condensed consolidated statements of operations

The revenues and expenses recognized in the Partnership’s condensed consolidated statements of operations for the three months ended March 31, 2015 and 2014, respectively, related to Urbplan were as follows:

	Three Months Ended March 31, 2015		Three Months Ended March 31, 2014
	(Dollars in millions)
Revenue of a consolidated real estate VIE
Land development services	$	54.8	$	4.6
Investment income	0.4		1.4
	$	55.2	$	6.0
Interest and other expenses of a consolidated real estate VIE:
Costs of products sold and services rendered	$	41.0	$	13.7
Interest expense	10.2		11.2
Change in fair value of loans payable	5.8		10.2
Compensation and benefits	2.6		2.4
G&A and other expenses	10.4		11.7
	$	70.0	$	49.2

Outstanding principal amounts on loans based on current contractual terms

Outstanding principal amounts on the loans based on current contractual terms are payable as follows (Dollars in millions):

2015	$	27.6
2016	24.3
2017	19.1
2018	16.5
2019	19.1
Thereafter	108.2
	$	214.8

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Intangible Assets and Goodwill - Estimated Future Amortization Expense (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2015
Goodwill and Intangible Assets Disclosure [Abstract]
2015	$ 61.0
2016	68.7
2017	65.6
2018	58.5
2019	48.4
Thereafter	51.3
Total	$ 353.5

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Consolidation of a Real Estate Development Company - Additional Information (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended	27 Months Ended
	Mar. 31, 2015	Mar. 31, 2015	Dec. 31, 2014
Real Estate Properties [Line Items]
Period, in days, of the financial reporting lag	90 days
Total amount of funding since initial consolidation of Urbplan		$ 227.4
Amount of funding received by Urbplan during the period	14.1
Amount of funding to Urbplan by Partnership during the period	3.5
Amount of funding to Urbplan by Senior Carlyle Professionals during the period	10.6
Customer advances received	148.1	148.1	190.4
IGP-M Plus
Real Estate Properties [Line Items]
Margin range of interest rates (as a percent)	12.00%
Additional margin range of interest rates (as a percent)	15.10%
Urbplan
Real Estate Properties [Line Items]
Maximum amount of additional funding required	90	90
Estimated fair value percentage of outstanding principal amounts of loans	65.00%
Outstanding future commitments for land development services	85.6	85.6
Minimum
Real Estate Properties [Line Items]
Customer receivables accrued interest rate (as a percent)	9.00%	9.00%
Minimum | CDI Plus
Real Estate Properties [Line Items]
Margin range of interest rates (as a percent)	4.00%
Additional margin range of interest rates (as a percent)	16.60%
Minimum | IPCA Plus
Real Estate Properties [Line Items]
Margin range of interest rates (as a percent)	10.00%
Additional margin range of interest rates (as a percent)	18.10%
Maximum
Real Estate Properties [Line Items]
Customer receivables accrued interest rate (as a percent)	12.00%	12.00%
Maximum | CDI Plus
Real Estate Properties [Line Items]
Margin range of interest rates (as a percent)	7.40%
Additional margin range of interest rates (as a percent)	20.00%
Maximum | IPCA Plus
Real Estate Properties [Line Items]
Margin range of interest rates (as a percent)	13.50%
Additional margin range of interest rates (as a percent)	21.60%
Partnership
Real Estate Properties [Line Items]
Partnership contractual obligation	54.3	54.3
Anticipated future capital contribution	25.00%	25.00%
Senior Carlyle professionals
Real Estate Properties [Line Items]
Amount of capital funding in year of consolidation	$ 173.1	$ 173.1
Anticipated future capital contribution	75.00%	75.00%

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Commitments and Contingencies (Tables)

3 Months Ended

Mar. 31, 2015

Commitments and Contingencies Disclosure [Abstract]

Schedule of unfunded commitments

The Partnership and its unconsolidated affiliates have unfunded commitments to entities within the following segments as of March 31, 2015 (Dollars in millions):

	Unfunded Commitments
Corporate Private Equity	$	2,013.1
Global Market Strategies	364.4
Real Assets	732.9
Investment Solutions	36.9
	$	3,147.3

Future minimum commitments for leases

The future minimum commitments for the leases are as follows (Dollars in millions):

2015	$	39.3
2016	51.5
2017	47.7
2018	43.7
2019	38.4
Thereafter	229.6
	$	450.2

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Summary of Significant Accounting Policies - Additional Information (Details) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2015 USD ($)	Mar. 31, 2014 USD ($)	Mar. 31, 2015 EUR (€)	Dec. 31, 2014 USD ($)	Dec. 31, 2014 EUR (€)
Accounting Policies [Abstract]
Accrued performance fee-related compensation	$ 1,808.4			$ 1,815.4
Percentage of estimated realizable tax benefit to be paid by corporate taxpayers on exchange transactions	85.00%
Percentage of remaining estimated realizable tax benefit on exchange transactions	15.00%
Cash withheld from carried interest distributions for potential giveback obligations	24.0			29.9
Restricted cash for carried interest proceeds for one corporate private equity fund				13.2
Cash received on behalf of a non-consolidated funds	18.7			8.7
Restricted cash included in escrow related to tax contingency	4.8		4.4	5.4	4.4
Cash received to satisfy collateral requirements	2.1			2.3
Restricted securities of consolidated funds	16.7			12.6
Foreign currency transaction gain (losses) before tax	15.4	0.6
Partners’ capital appropriated for Consolidated Funds	$ 126.9			$ 184.5

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Investments - Components of Investment Income (Loss) (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Equity Method Investments and Joint Ventures [Abstract]
Income from equity investments	$ 8.8	$ 4.0
Income (loss) from trading securities	(2.6)	1.9
Other investment income	0.6	0.2
Total investment income	$ 6.8	$ 6.1

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Supplemental Financial Information - Supplemental Statement of Cash Flows (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Cash flows from operating activities
Net income	$ 128.0	$ 119.0
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation and amortization	39.9	57.7
Equity-based compensation	89.9	74.2
Excess tax benefits related to equity-based compensation	(0.5)	0
Non-cash performance fees	(278.8)	(463.9)
Other non-cash amounts	23.8	42.6
Investment loss (income)	27.3	(3.3)
Purchases of investments and trading securities	(40.9)	(69.1)
Proceeds from the sale of investments and trading securities	283.4	411.2
Payments of contingent consideration	(3.3)	(43.5)
Change in deferred taxes, net	(0.3)	1.4
Change in due from affiliates and other receivables	(7.8)	(5.3)
Change in receivables and inventory of a consolidated real estate VIE	(34.4)	(0.8)
Change in deposits and other	(6.3)	(7.1)
Change in other assets of a consolidated real estate VIE	15.8	11.5
Change in accounts payable, accrued expenses and other liabilities	(33.1)	(32.3)
Change in accrued compensation and benefits	(11.4)	(57.3)
Change in due to affiliates	12.0	(83.9)
Change in other liabilities of a consolidated real estate VIE	31.9	7.3
Change in deferred revenue	106.9	133.5
Net cash provided by operating activities	342.1	91.9
Cash flows from investing activities
Change in restricted cash	18.3	84.5
Purchases of fixed assets, net	(17.4)	(3.7)
Acquisitions, net of cash acquired	0	(3.1)
Net cash provided by investing activities	0.9	77.7
Cash flows from financing activities
Issuance of 5.625% senior notes due 2043, net of financing costs	0	210.8
Net payments on loans payable of a consolidated real estate VIE	(11.1)	(9.5)
Payments of contingent consideration	(0.5)	(29.2)
Excess tax benefits related to equity-based compensation	0.5	0
Distributions to common unitholders	(110.9)	(70.4)
Distributions to non-controlling interest holders in Carlyle Holdings	(403.6)	(366.5)
Contributions from non-controlling interest holders	53.7	52.2
Distributions to non-controlling interest holders	(44.7)	(33.9)
Net proceeds from issuance of common units, net of offering costs	0	449.5
Acquisition of non-controlling interests in Carlyle Holdings	0	(303.4)
Cash and cash equivalents, beginning of period	(5.2)	1.6
Net cash used in financing activities	(521.8)	(98.8)
Effect of foreign exchange rate changes	(38.4)	(3.1)
(Decrease) increase in cash and cash equivalents	(217.2)	67.7
Cash and cash equivalents, beginning of period	1,242.0	966.6
Cash and cash equivalents, end of period	$ 1,024.8	$ 1,034.3

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Accrued Performance Fees - Performance Fees (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Segment Reporting Information [Line Items]
Performance fees	$ 573.0	$ 620.5
Corporate Private Equity
Segment Reporting Information [Line Items]
Performance fees	513.3	453.2
Global Market Strategies
Segment Reporting Information [Line Items]
Performance fees	18.7	66.1
Real Assets
Segment Reporting Information [Line Items]
Performance fees	(8.5)	16.8
Investment Solutions
Segment Reporting Information [Line Items]
Performance fees	$ 49.5	$ 84.4

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Summary of Significant Accounting Policies - Investments in Unconsolidated Variable Interest Entities (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Variable Interest Entity [Line Items]
Investments	$ 944.2	$ 931.6
Variable Interest Entity, Primary Beneficiary
Variable Interest Entity [Line Items]
Investments	521.2	511.8
Receivables	7.3	3.7
Maximum Exposure to Loss	$ 528.5	$ 515.5

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Summary of Significant Accounting Policies

3 Months Ended

Mar. 31, 2015

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

Principles of Consolidation

The Partnership consolidates all entities that it controls through a majority voting interest or otherwise. In addition, the accompanying condensed consolidated financial statements consolidate: (1) Carlyle-affiliated funds and co-investment entities, for which the Partnership is the sole general partner and the presumption of control by the general partner has not been overcome and (2) variable interest entities (“VIEs”), including certain CLOs and a real estate development company, for which the Partnership is deemed to be the primary beneficiary; consolidation of these entities is a requirement under U.S. GAAP. All significant inter-entity transactions and balances have been eliminated.

For entities that are determined to be VIEs, the Partnership consolidates those entities where it is deemed to be the primary beneficiary. An entity is determined to be the primary beneficiary if it holds a controlling financial interest. A controlling financial interest is defined as (a) the power to direct the activities of a VIE that most significantly impact the entity’s business and (b) the obligation to absorb losses of the entity or the right to receive benefits from the entity that could potentially be significant to the VIE. The revised consolidation rules require an analysis to (a) determine whether an entity in which the Partnership holds a variable interest is a VIE and (b) whether the Partnership’s involvement, through holding interests directly or indirectly in the entity or contractually through other variable interests (e.g., management and performance related fees), would give it a controlling financial interest. In evaluating whether the Partnership is the primary beneficiary, the Partnership evaluates its economic interests in the entity held either directly or indirectly by the Partnership. The consolidation analysis is generally performed qualitatively. This analysis, which requires judgment, is performed at each reporting date.

In February 2010, Accounting Standards Update (“ASU”) No. 2010-10, “Amendments for Certain Investment Funds,” was issued. This ASU defers the application of the revised consolidation rules for a reporting enterprise’s interest in an entity if certain conditions are met, including if the entity has the attributes of an investment company and is not a securitization or asset-backed financing entity. An entity that qualifies for the deferral will continue to be assessed for consolidation under the overall guidance on VIEs, before its amendment, and other applicable consolidation guidance.

As of March 31, 2015, assets and liabilities of consolidated VIEs reflected in the condensed consolidated balance sheets were $24.2 billion and $18.3 billion, respectively. Except to the extent of the assets of the VIEs which are consolidated, the holders of the consolidated VIEs’ liabilities generally do not have recourse to the Partnership. The assets and liabilities of the consolidated VIEs that are Consolidated Funds are comprised primarily of investments and loans payable, respectively.

The loans payable issued by the CLOs are backed by diversified collateral asset portfolios consisting primarily of loans or structured debt. In exchange for managing the collateral for the CLOs, the Partnership earns investment management fees, including in some cases subordinated management fees and contingent incentive fees. In cases where the Partnership consolidates the CLOs, those management fees have been eliminated as intercompany transactions. As of March 31, 2015, the Partnership held $169.3 million of investments in these CLOs which represent its maximum risk of loss. The Partnership’s investments in these CLOs are generally subordinated to other interests in the entities and entitle the Partnership to receive a pro rata portion of the residual cash flows, if any, from the entities. Investors in the CLOs have no recourse against the Partnership for any losses sustained in the CLO structure.

For all Carlyle-affiliated funds and co-investment entities (collectively “the funds”) that are not determined to be VIEs, the Partnership consolidates those funds where, as the sole general partner, it has not overcome the presumption of control pursuant to U.S. GAAP. Most Carlyle funds provide a dissolution right upon a simple majority vote of the non-Carlyle affiliated limited partners such that the presumption of control by Carlyle is overcome. Accordingly, these funds are not consolidated in the Partnership’s condensed consolidated financial statements.

Investments in Unconsolidated Variable Interest Entities

The Partnership holds variable interests in certain VIEs that are not consolidated because the Partnership is not the primary beneficiary, including its strategic investment in NGP Management Company, L.L.C. (“NGP Management” and, together with its affiliates, “NGP”). Refer to Note 6 for information on this investment. The Partnership’s involvement with such entities is in the form of direct equity interests and fee arrangements. The maximum exposure to loss represents the loss of assets recognized by the Partnership relating to these unconsolidated entities. The assets recognized in the Partnership’s condensed consolidated balance sheets related to the Partnership’s interests in these non-consolidated VIEs and the Partnership’s maximum exposure to loss relating to non-consolidated VIEs were as follows:

	As of
	March 31, 2015		December 31, 2014
	(Dollars in millions)
Investments	$	521.2	$	511.8
Receivables	7.3		3.7
Maximum Exposure to Loss	$	528.5	$	515.5

Basis of Accounting

The accompanying financial statements are prepared in accordance with U.S. GAAP. Management has determined that the Partnership’s Funds are investment companies under U.S. GAAP for the purposes of financial reporting. U.S. GAAP for an investment company requires investments to be recorded at estimated fair value and the unrealized gains and/or losses in an investment’s fair value are recognized on a current basis in the statements of operations. Additionally, the Funds do not consolidate their majority-owned and controlled investments (the “Portfolio Companies”). In the preparation of these condensed consolidated financial statements, the Partnership has retained the specialized accounting for the Funds.

All of the investments held and notes issued by the Consolidated Funds are presented at their estimated fair values in the Partnership’s condensed consolidated balance sheets. Interest and other income of the Consolidated Funds as well as interest expense and other expenses of the Consolidated Funds are included in the Partnership’s condensed consolidated statements of operations. The excess of the CLO assets over the CLO liabilities upon consolidation is reflected in the Partnership’s condensed consolidated balance sheets as partners’ capital appropriated for Consolidated Funds. Net income attributable to the investors in the CLOs is included in net income (loss) attributable to non-controlling interests in consolidated entities in the condensed consolidated statements of operations and partners’ capital appropriated for Consolidated Funds in the condensed consolidated balance sheets.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make assumptions and estimates that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Management’s estimates are based on historical experiences and other factors, including expectations of future events that management believes to be reasonable under the circumstances. It also requires management to exercise judgment in the process of applying the Partnership’s accounting policies. Assumptions and estimates regarding the valuation of investments and their resulting impact on performance fees involve a higher degree of judgment and complexity and these assumptions and estimates may be significant to the consolidated financial statements and the resulting impact on performance fees. Actual results could differ from these estimates and such differences could be material.

Business Combinations

The Partnership accounts for business combinations using the acquisition method of accounting, under which the purchase price of the acquisition is allocated to the assets acquired and liabilities assumed using the fair values determined by management as of the acquisition date. Contingent consideration obligations that are elements of consideration transferred are recognized as of the acquisition date as part of the fair value transferred in exchange for the acquired business. Acquisition-related costs incurred in connection with a business combination are expensed.

Revenue Recognition

Fund Management Fees

The Partnership provides management services to funds in which it holds a general partner interest or has a management agreement. For corporate private equity, certain global market strategies funds and real assets funds, management fees are calculated based on (a) limited partners’ capital commitments to the funds, (b) limited partners’ remaining capital invested in the funds at cost or at the lower of cost or aggregate remaining fair value, (c) gross assets, excluding cash and cash equivalents or (d) the net asset value (“NAV”) of certain of the funds, less offsets for the non-affiliated limited partners’ share of transaction advisory and portfolio fees earned, as defined in the respective partnership agreements.

Management fees for corporate private equity, closed-end carry funds in the global market strategies segment and real assets funds generally range from 1% to 2% of commitments during the investment period of the relevant fund. Following the expiration or termination of the investment period of such funds, the management fees generally step-down to between 0.6% and 2.0% generally on the lower of cost or fair value of capital invested; however, certain of our managed accounts base management fees at all times on contributions for unrealized investments or the current value of the investment. The Partnership will receive management fees for corporate private equity and real assets funds during a specified period of time, which is generally ten years from the initial closing date, or, in some instances, from the final closing date, but such termination date may be earlier in certain limited circumstances or later if extended for successive one-year periods, typically up to a maximum of two years. Depending upon the contracted terms of investment advisory or investment management and related agreements, these fees are generally called semi-annually in advance and are recognized as earned over the subsequent six month period.

For certain global market strategies funds, management fees are calculated based on assets under management of the funds with generally lower fee rates. Hedge funds typically pay management fees quarterly that generally range from 1.5% to 2.0% of NAV per year. Management fees for the business development companies are due quarterly in arrears at annual rates that range from 0.25% to 1.0% of gross assets, excluding cash and cash equivalents. Management fees for the CLOs and other structured products typically range from 0.15% to 1.0% on the total par amount of assets or the aggregate principal amount of the notes in the CLO and are due quarterly or semi-annually based on the terms and recognized over the respective period. Management fees for the CLOs/structured products and credit opportunities are governed by indentures and collateral management agreements. The Partnership will receive management fees for the CLOs until redemption of the securities issued by the CLOs, which is generally five to ten years after issuance. Open-ended funds typically do not have stated termination dates.

Management fees for our private equity and real estate fund of funds vehicles generally range from 0.3% to 1.0% on the vehicle’s capital commitments during the commitment fee period of the relevant fund or the weighted-average investment period of the underlying funds. Following the expiration of the commitment fee period or weighted-average investment period of such funds, the management fees generally range from 0.3% to 1.0% on the lower of cost or fair value of the capital invested, the net asset value for unrealized investments, or the contributions for unrealized investments. The management fees for our fund of hedge fund vehicles generally range from 0.2% to 1.5% of net asset value. Management fees for our Investment Solutions segment are generally due quarterly and recognized over the related quarter.

The Partnership also provides transaction advisory and portfolio advisory services to the Portfolio Companies, and where covered by separate contractual agreements, recognizes fees for these services when the service has been provided and collection is reasonably assured. Fund management fees includes transaction and portfolio advisory fees of $7.6 million and $7.0 million for the three months ended March 31, 2015 and 2014, respectively, net of any offsets as defined in the respective partnership agreements.

Performance Fees

Performance fees consist principally of the allocation of profits from certain of the funds to which the Partnership is entitled (commonly known as carried interest). The Partnership is generally entitled to a 20% allocation (or 10% to 20% on external coinvestment vehicles, with some earning no carried interest, or approximately 2% to 10% in the case of most of the Partnership’s fund of funds vehicles) of the net realized income or gain as a carried interest after returning the invested capital, the allocation of preferred returns of generally 8% to 9% and return of certain fund costs (generally subject to catch-up provisions as set forth in the fund limited partnership agreement) from its corporate private equity and real assets funds and closed-end carry funds in the global market strategies segment. Carried interest is recognized upon appreciation of the funds’ investment values above certain return hurdles set forth in each respective partnership agreement. The Partnership recognizes revenues attributable to performance fees based upon the amount that would be due pursuant to the fund partnership agreement at each period end as if the funds were terminated at that date. Accordingly, the amount recognized as performance fees reflects the Partnership’s share of the gains and losses of the associated funds’ underlying investments measured at their then-current fair values. Because of the inherent uncertainty, these estimated values may differ significantly from the values that would have been used had a ready market for the investments existed, and it is reasonably possible that the difference could be material.

Carried interest is ultimately realized when: (i) an underlying investment is profitably disposed of, (ii) certain costs borne by the limited partner investors have been reimbursed, (iii) the fund’s cumulative returns are in excess of the preferred return and (iv) the Partnership has decided to collect carry rather than return additional capital to limited partner investors. Realized carried interest may be required to be returned by the Partnership in future periods if the funds’ investment values decline below certain levels. When the fair value of a fund’s investments remains constant or falls below certain return hurdles, previously recognized performance fees are reversed. In all cases, each fund is considered separately in this regard, and for a given fund, performance fees can never be negative over the life of a fund. If upon a hypothetical liquidation of a fund’s investments at their then-current fair values, previously recognized and distributed carried interest would be required to be returned, a liability is established for the potential giveback obligation. As of March 31, 2015 and December 31, 2014, the Partnership has recognized $176.6 million and $104.4 million, respectively, for giveback obligations.

In addition to its performance fees from its corporate private equity and real assets funds and closed-end carry funds in the global market strategies segment, the Partnership is also entitled to receive performance fees from certain of its global market strategies funds and fund of funds vehicles when the return on assets under management exceeds certain benchmark returns or other performance targets. In such arrangements, performance fees are recognized when the performance benchmark has been achieved, and are included in performance fees in the accompanying condensed consolidated statements of operations.

Investment Income (Loss)

Investment income (loss) represents the unrealized and realized gains and losses resulting from the Partnership’s equity method investments and other principal investments. Equity method investment income (loss) includes the related amortization of the basis difference between the Partnership’s carrying value of its investment and the Partnership’s share of underlying net assets of the investee, as well as the compensation expense associated with compensatory arrangements provided by the Partnership to employees of its equity method investee. Investment income (loss) is realized when the Partnership redeems all or a portion of its investment or when the Partnership receives or is due cash income, such as dividends or distributions. Unrealized investment income (loss) results from changes in the fair value of the underlying investment as well as the reversal of unrealized gain (loss) at the time an investment is realized.

Interest Income

Interest income is recognized when earned. Interest income earned by the Partnership is included in interest and other income in the accompanying condensed consolidated statements of operations. Interest income of the Consolidated Funds was $208.4 million and $221.2 million for the three months ended March 31, 2015 and 2014, respectively, and is included in interest and other income of Consolidated Funds in the accompanying condensed consolidated statements of operations.

Compensation and Benefits

Base Compensation – Base compensation includes salaries, bonuses (discretionary awards and guaranteed amounts), performance payment arrangements and benefits paid and payable to Carlyle employees. Bonuses are accrued over the service period to which they relate.

Equity-Based Compensation – Compensation expense relating to the issuance of equity-based awards to Carlyle employees is measured at fair value on the grant date. The compensation expense for awards that vest over a future service period is recognized over the relevant service period on a straight-line basis, adjusted for estimated forfeitures of awards not expected to vest. The compensation expense for awards that do not require future service is recognized immediately. Upon the end of the service period, compensation expense is adjusted to account for the actual forfeiture rate. Cash settled equity-based awards are classified as liabilities and are re-measured at the end of each reporting period. The compensation expense for awards that contain performance conditions is recognized when it is probable that the performance conditions will be achieved; in certain instances, such compensation expense may be recognized prior to the grant date of the award.

Equity-based awards issued to non-employees are recognized as general, administrative and other expenses. The grant-date fair value of equity-based awards granted to Carlyle’s non-employee directors is expensed on a straight-line basis over the vesting period. The cost of services received in exchange for an equity-based award issued to consultants is measured at each vesting date, and is not measured based on the grant-date fair value of the award unless the award is vested at the grant date. Equity-based awards that require the satisfaction of future service criteria are recognized over the relevant service period, adjusted for estimated forfeitures of awards not expected to vest, based on the fair value of the award on each reporting date and adjusted for the actual fair value of the award at each vesting date. Accordingly, the measured value of the award will not be finalized until the vesting date.

Performance Fee Related Compensation – A portion of the performance fees earned is due to employees and advisors of the Partnership. These amounts are accounted for as compensation expense in conjunction with the recognition of the related performance fee revenue and, until paid, are recognized as a component of the accrued compensation and benefits liability. Accordingly, upon any reversal of performance fee revenue, the related compensation expense is also reversed. As of March 31, 2015 and December 31, 2014, the Partnership had recorded a liability of $1.8 billion related to the portion of accrued performance fees due to employees and advisors, which was included in accrued compensation and benefits in the accompanying condensed consolidated financial statements.

Income Taxes

Certain of the wholly-owned subsidiaries of the Partnership and the Carlyle Holdings partnerships are subject to federal, state, local and foreign corporate income taxes at the entity level and the related tax provision attributable to the Partnership’s share of this income is reflected in the condensed consolidated financial statements. Based on applicable foreign, state and local tax laws, the Partnership records a provision for income taxes for certain entities. Tax positions taken by the Partnership are subject to periodic audit by U.S. federal, state, local and foreign taxing authorities.

The Partnership accounts for income taxes under the provisions of Accounting Standards Codification (“ASC”) 740, Income Taxes (“ASC 740”), using the liability method. ASC 740 requires the recognition of deferred tax liabilities and assets for the expected future consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial statement reporting and the tax basis of assets and liabilities using enacted tax rates in effect for the period in which the difference is expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in the period of the change in the provision for income taxes. Further, deferred tax assets are recognized for the expected realization of available net operating loss and tax credit carry forwards. A valuation allowance is recorded on the Partnership’s gross deferred tax assets when it is “more likely than not” that such asset will not be realized. When evaluating the realizability of the Partnership’s deferred tax assets, all evidence, both positive and negative, is evaluated. Items considered in this analysis include the ability to carry back losses, the reversal of temporary differences, tax planning strategies, and expectations of future earnings.

Under U.S. GAAP for income taxes, the amount of tax benefit to be recognized is the amount of benefit that is “more likely than not” to be sustained upon examination. The Partnership analyzes its tax filing positions in all of the U.S. federal, state, local and foreign tax jurisdictions where it is required to file income tax returns, as well as for all open tax years in these jurisdictions. If, based on this analysis, the Partnership determines that uncertainties in tax positions exist, a liability is established, which is included in accounts payable, accrued expenses and other liabilities in the condensed consolidated financial statements. The Partnership recognizes accrued interest and penalties related to unrecognized tax positions in the provision for income taxes. If recognized, the entire amount of unrecognized tax positions would be recorded as a reduction in the provision for income taxes.

Tax Receivable Agreement

Exchanges of Carlyle Holdings partnership units for the Partnership’s common units that are executed by the limited partners of the Carlyle Holdings partnerships result in transfers of and increases in the tax basis of the tangible and intangible assets of Carlyle Holdings, primarily attributable to a portion of the goodwill inherent in the business. These transfers and increases in tax basis will increase (for tax purposes) depreciation and amortization and therefore reduce the amount of tax that certain of the Partnership’s subsidiaries, including Carlyle Holdings I GP Inc., which are referred to as the “corporate taxpayers,” would otherwise be required to pay in the future. This increase in tax basis may also decrease gain (or increase loss) on future dispositions of certain capital assets to the extent tax basis is allocated to those capital assets. The Partnership has entered into a tax receivable agreement with the limited partners of the Carlyle Holdings partnerships whereby the corporate taxpayers have agreed to pay to the limited partners of the Carlyle Holdings partnerships involved in any exchange transaction 85% of the amount of cash tax savings, if any, in U.S. federal, state and local income tax or foreign or franchise tax that the corporate taxpayers realize as a result of these increases in tax basis and, in limited cases, transfers or prior increases in tax basis. The corporate taxpayers expect to benefit from the remaining 15% of cash tax savings, if any, in income tax they realize. Payments under the tax receivable agreement will be based on the tax reporting positions that the Partnership will determine. The corporate taxpayers will not be reimbursed for any payments previously made under the tax receivable agreement if a tax basis increase is successfully challenged by the Internal Revenue Service.

The Partnership records an increase in deferred tax assets for the estimated income tax effects of the increases in tax basis based on enacted federal and state tax rates at the date of the exchange. To the extent that the Partnership estimates that the corporate taxpayers will not realize the full benefit represented by the deferred tax asset, based on an analysis that will consider, among other things, its expectation of future earnings, the Partnership will reduce the deferred tax asset with a valuation allowance and will assess the probability that the related liability owed under the tax receivable agreement will be paid. The Partnership records 85% of the estimated realizable tax benefit (which is the recorded deferred tax asset less any recorded valuation allowance) as an increase to the liability due under the tax receivable agreement, which is included in due to affiliates in the accompanying condensed consolidated financial statements. The remaining 15% of the estimated realizable tax benefit is initially recorded as an increase to the Partnership’s partners’ capital.

All of the effects to the deferred tax asset of changes in any of the Partnership’s estimates after the tax year of the exchange will be reflected in the provision for income taxes. Similarly, the effect of subsequent changes in the enacted tax rates will be reflected in the provision for income taxes.

Non-controlling Interests

Non-controlling interests in consolidated entities represent the component of equity in consolidated entities held by third-party investors. These interests are adjusted for general partner allocations and by subscriptions and redemptions in hedge funds which occur during the reporting period. Any change in ownership of a subsidiary while the controlling financial interest is retained is accounted for as an equity transaction between the controlling and non-controlling interests. Transaction costs incurred in connection with such changes in ownership of a subsidiary are recorded as a direct charge to partners’ capital.

Non-controlling interests related to hedge funds are subject to quarterly or monthly redemption by investors in these funds following the expiration of a specified period of time, or may be withdrawn subject to a redemption fee during the period when capital may not be withdrawn. As limited partners in these types of funds have been granted redemption rights, amounts relating to third-party interests in such consolidated funds are presented as redeemable non-controlling interests in consolidated entities within the condensed consolidated balance sheets. When redeemable amounts become contractually payable to investors, they are classified as a liability and included in other liabilities of Consolidated Funds in the condensed consolidated balance sheets.

Non-controlling interests in Carlyle Holdings relate to the ownership interests of the other limited partners of the Carlyle Holdings partnerships. The Partnership, through wholly-owned subsidiaries, is the sole general partner of Carlyle Holdings.  Accordingly, the Partnership consolidates Carlyle Holdings into its consolidated financial statements, and the other ownership interests in Carlyle Holdings are reflected as non-controlling interests in the Partnership’s condensed consolidated financial statements. Any change to the Partnership’s ownership interest in Carlyle Holdings while it retains the controlling financial interest in Carlyle Holdings is accounted for as a transaction within partners’ capital as a reallocation of ownership interests in Carlyle Holdings.

Earnings Per Common Unit

The Partnership computes earnings per common unit in accordance with ASC 260, Earnings Per Share (“ASC 260”). Basic earnings per common unit is calculated by dividing net income (loss) attributable to the common units of the Partnership by the weighted-average number of common units outstanding for the period. Diluted earnings per common unit reflects the assumed conversion of all dilutive securities. Net income (loss) attributable to the common units excludes net income (loss) and dividends attributable to any participating securities under the two-class method of ASC 260.

Investments

Investments include (i) the Partnership’s ownership interests (typically general partner interests) in the Funds, (ii) the investments held by the Consolidated Funds (all of which are presented at fair value in the Partnership’s condensed consolidated financial statements), (iii) strategic investments made by the Partnership and (iv) certain credit-oriented investments.

The valuation procedures utilized for investments of the Funds vary depending on the nature of the investment. The fair value of investments in publicly-traded securities is based on the closing price of the security with adjustments to reflect appropriate discounts if the securities are subject to restrictions.

The fair value of non-equity securities or other investments, which may include instruments that are not listed on an exchange, considers, among other factors, external pricing sources, such as dealer quotes or independent pricing services, recent trading activity or other information that, in the opinion of the Partnership, may not have been reflected in pricing obtained from external sources.

When valuing private securities or assets without readily determinable market prices, the Partnership gives consideration to operating results, financial condition, economic and/or market events, recent sales prices and other pertinent information. These valuation procedures may vary by investment but include such techniques as comparable public market valuation, comparable acquisition valuation and discounted cash flow analysis. Because of the inherent uncertainty, these estimated values may differ significantly from the values that would have been used had a ready market for the investments existed, and it is reasonably possible that the difference could be material. Furthermore, there is no assurance that, upon liquidation, the Partnership will realize the values presented herein.

Upon the sale of a security or other investment, the realized net gain or loss is computed on a weighted average cost basis, with the exception of the CLOs, which compute the realized net gain or loss on a first in, first out basis. Securities transactions are recorded on a trade date basis.

Equity-Method Investments

The Partnership accounts for all investments in which it has or is otherwise presumed to have significant influence, including investments in the unconsolidated Funds and strategic investments, using the equity method of accounting. The carrying value of equity-method investments is determined based on amounts invested by the Partnership, adjusted for the equity in earnings or losses of the investee allocated based on the respective partnership agreement, less distributions received. The Partnership evaluates its equity-method investments for impairment whenever events or changes in circumstances indicate that the carrying amounts of such investments may not be recoverable.

Cash and Cash Equivalents

Cash and cash equivalents include cash held at banks and cash held for distributions, including temporary investments with original maturities of less than three months when purchased. Included in cash and cash equivalents is cash withheld from carried interest distributions for potential giveback obligations of $24.0 million and $29.9 million at March 31, 2015 and December 31, 2014, respectively.

Cash and Cash Equivalents Held at Consolidated Funds

Cash and cash equivalents held at Consolidated Funds consists of cash and cash equivalents held by the Consolidated Funds, which, although not legally restricted, is not available to fund the general liquidity needs of the Partnership.

Restricted Cash

Restricted cash at March 31, 2015 and December 31, 2014 includes $18.7 million and $8.7 million, respectively, of cash received on behalf of certain non-consolidated Carlyle funds that was paid out in April 2015 and January 2015, respectively. Also included in restricted cash at March 31, 2015 and December 31, 2014 is €4.4 million ($4.8 million and $5.4 million as of March 31, 2015 and December 31, 2014, respectively) in escrow related to a tax contingency at one of the Partnership’s real estate funds (see Note 11). Also included in restricted cash at December 31, 2014 was $13.2 million which is no longer restricted at March 31, 2015. The remaining balance in restricted cash at March 31, 2015 and December 31, 2014 primarily represents cash held by the Partnership’s foreign subsidiaries due to certain government regulatory capital requirements.

Restricted Cash and Securities of Consolidated Funds

Certain CLOs receive cash from various counterparties to satisfy collateral requirements on derivative transactions. Cash received to satisfy these collateral requirements of $2.1 million and $2.3 million is included in restricted cash and securities of Consolidated Funds at March 31, 2015 and December 31, 2014, respectively.

Certain CLOs hold U.S. Treasury notes and corporate bonds as collateral for specific classes of loans payable in the CLOs. As of March 31, 2015 and December 31, 2014, securities of $16.7 million and $12.6 million, respectively, are included in restricted cash and securities of Consolidated Funds.

Derivative Instruments

Derivative instruments are recognized at fair value in the condensed consolidated balance sheets with changes in fair value recognized in the condensed consolidated statements of operations for all derivatives not designated as hedging instruments. For all derivatives where hedge accounting is applied, effectiveness testing and other procedures to assess the ongoing validity of the hedges are performed at least quarterly. For instruments designated as cash flow hedges, the Partnership records changes in the estimated fair value of the derivative, to the extent that the hedging relationship is effective, in other comprehensive income (loss). If the hedging relationship for a derivative is determined to be ineffective, due to changes in the hedging instrument or the hedged items, the fair value of the portion of the hedging relationship determined to be ineffective will be recognized as a gain or loss in the condensed consolidated statements of operations.

Fixed Assets

Fixed assets consist of furniture, fixtures and equipment, leasehold improvements, and computer hardware and software and are stated at cost, less accumulated depreciation and amortization. Depreciation is recognized on a straight-line method over the assets’ estimated useful lives, which for leasehold improvements are the lesser of the lease terms or the life of the asset, and three to seven years for other fixed assets. Fixed assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

Intangible Assets and Goodwill

The Partnership’s intangible assets consist of acquired contractual rights to earn future fee income, including management and advisory fees, customer relationships, and acquired trademarks. Finite-lived intangible assets are amortized over their estimated useful lives, which range from three to ten years, and are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable.

Goodwill represents the excess of cost over the identifiable net assets of businesses acquired and is recorded in the functional currency of the acquired entity. Goodwill is recognized as an asset and is reviewed for impairment annually as of October 1st and between annual tests when events and circumstances indicate that impairment may have occurred.

Deferred Revenue

Deferred revenue represents management fees and other revenue received prior to the balance sheet date, which has not yet been earned.

Comprehensive Income (Loss)

Comprehensive income (loss) consists of net income (loss) and other comprehensive income (loss). The Partnership’s other comprehensive income (loss) is comprised of unrealized gains and losses on cash flow hedges, foreign currency translation adjustments and gains and losses on defined benefit plans sponsored by AlpInvest. The components of accumulated other comprehensive income (loss) as of March 31, 2015 and December 31, 2014 were as follows:

	As of
	March 31, 2015			December 31, 2014
	(Dollars in millions)
Unrealized losses on cash flow hedge instruments	$	(0.8	)	$	(0.9	)
Currency translation adjustments	(47.9		)	(35.8		)
Unrealized losses on defined benefit plans	(1.7		)	(2.3		)
Total	$	(50.4	)	$	(39.0	)

Foreign Currency Translation

Non-U.S. dollar denominated assets and liabilities are translated at period-end rates of exchange, and the condensed consolidated statements of operations are translated at rates of exchange in effect throughout the period. Foreign currency losses resulting from transactions outside of the functional currency of an entity of $15.4 million and $0.6 million for the three months ended March 31, 2015 and 2014, respectively, are included in general, administrative and other expenses in the condensed consolidated statements of operations.

Recent Accounting Pronouncements

On April 7, 2015, the FASB issued ASU 2015-3, Interest - Imputation of Interest (Subtopic 835-30) - Simplifying the Presentation of Debt Issuance Costs. ASU 2015-3 requires debt issuance costs related to a recognized debt liability to be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts and premiums. This guidance is effective for the Partnership on January 1, 2016 and the ASU requires the guidance to be applied on a retrospective basis. This guidance is not expected to have a material impact on the Partnership's consolidated financial statements upon adoption.

On February 18, 2015, the FASB issued ASU 2015-2, Consolidation (Topic 820): Amendments to the Consolidation Analysis. ASU 2015-2 provides a revised consolidation model for all reporting entities to use in evaluating whether they should consolidate certain legal entities. All legal entities will be subject to reevaluation under this revised consolidation model. The revised consolidation model, among other things, (i) modifies the evaluation of whether limited partnerships and similar legal entities are VIEs or voting interest entities, (ii) eliminates the presumption that a general partner should consolidate a limited partnership, and (iii) modifies the consolidation analysis of reporting entities that are involved with VIEs through fee arrangements and related party relationships. This guidance in ASU 2015-2 is effective for the Partnership beginning on January 1, 2016; however, early adoption is permitted. The Partnership is currently assessing the potential impact that this guidance will have on its consolidated financial statements.

In August 2014, the FASB issued ASU 2014-13, Consolidation (Topic 810): Measuring the Financial Assets and the Financial Liabilities of a Consolidated Collateralized Financing Entity. ASU 2014-13 relates to reporting entities that elect to measure all eligible financial assets and financial liabilities of a consolidated collateralized financing entity at fair value. Under the Partnership's current practice, the difference between the fair value of the financial assets and the fair value of the financial liabilities is classified within partners’ capital appropriated for Consolidated Funds. ASU 2014-13 requires the reporting entity to initially measure both the financial assets and financial liabilities using the fair value of the financial assets or financial liabilities, whichever is more observable. As a result, the reporting entity will no longer have a difference to report within appropriated partners’ capital. This guidance is effective for the Partnership on January 1, 2016. The Partnership’s consolidated CLOs are consolidated collateralized financing entities for which the Partnership has measured financial assets and financial liabilities at fair value. The guidance is expected to change the measurement of the financial assets or financial liabilities of the Partnership's consolidated CLOs, which will impact net income but not impact net income attributable to the Partnership. Upon adoption, substantially all the balance within partners' capital appropriated for Consolidated Funds will be reclassified to investments of Consolidated Funds or loans payable of Consolidated Funds. At March 31, 2015 partners' capital appropriated for Consolidated Funds was $126.9 million.

In May 2014, the FASB issued ASU 2014-9, Revenue from Contracts with Customers (Topic 606). ASU 2014-9 provides comprehensive guidance for recognizing revenue from contracts with customers. Entities will be able to recognize revenue when the entity transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. The guidance includes a five-step framework that requires an entity to: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when the entity satisfies a performance obligation. The guidance in ASU 2014-9 is effective for the Partnership beginning on January 1, 2017. However, in April 2015, the FASB issued an exposure draft that, if ratified, would delay the implementation by a year. The Partnership is still assessing the potential impact of this guidance, however, this may have a material impact on the Partnership's consolidated financial statements by significantly delaying the recognition of performance fee revenue.

XML

Accrued Performance Fees - Additional Information (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2015 Funds	Mar. 31, 2014	Dec. 31, 2014
Segment Reporting Information [Line Items]
Percentage of accrued performance fees related to certain Corporate Private Equity funds	51.00%		55.00%
Number of Partnership's Corporate Private Equity funds related to accrued performance fees	2
Percentage of performance fees related to certain Corporate Private Equity funds	58.00%	67.00%
Performance fees related to certain Corporate Private Equity funds	$ 333.7	$ 413.1
Number of Partnership's Corporate Private Equity funds related to performance fees	3
Carlyle Partners IV, L.P.
Segment Reporting Information [Line Items]
Revenue recognized on certain Corporate Private Equity funds	83.8
Carlyle Partners V, L.P.
Segment Reporting Information [Line Items]
Revenue recognized on certain Corporate Private Equity funds	175.6	270.6
Carlyle Europe Partners III, L.P.
Segment Reporting Information [Line Items]
Revenue recognized on certain Corporate Private Equity funds	173.7	184.6
Carlyle/Riverstone Global Energy and Power Fund III, L.P.
Segment Reporting Information [Line Items]
Revenue recognized on certain Corporate Private Equity funds	$ (64.8)

XML

Segment Reporting (Tables)

3 Months Ended

Mar. 31, 2015

Segment Reporting [Abstract]

Reportable segments financial data

The following table presents the financial data for the Partnership’s four reportable segments as of and for the three months ended March 31, 2015:

	March 31, 2015 and the Three Months Then Ended
	Corporate Private Equity		Global Market Strategies			Real Assets			Investment Solutions		Total
	(Dollars in millions)
Segment Revenues
Fund level fee revenues
Fund management fees	$	134.3	$	55.5		$	66.3		$	40.5	$	296.6
Portfolio advisory fees, net	5.2		0.5			0.1			—		5.8
Transaction fees, net	1.5		—			0.3			—		1.8
Total fund level fee revenues	141.0		56.0			66.7			40.5		304.2
Performance fees
Realized	306.0		4.6			7.7			3.4		321.7
Unrealized	200.7		18.7			14.1			47.0		280.5
Total performance fees	506.7		23.3			21.8			50.4		602.2
Investment income (loss)
Realized	2.7		1.6			(86.4		)	0.1		(82.0		)
Unrealized	7.4		(4.2		)	50.2			0.6		54.0
Total investment income (loss)	10.1		(2.6		)	(36.2		)	0.7		(28.0		)
Interest and other income	3.2		1.8			1.1			0.4		6.5
Total revenues	661.0		78.5			53.4			92.0		884.9
Segment Expenses
Compensation and benefits
Direct base compensation	53.7		28.2			18.5			21.5		121.9
Indirect base compensation	26.3		8.8			12.3			3.6		51.0
Equity-based compensation	17.3		5.2			7.1			2.7		32.3
Performance fee related
Realized	137.0		2.3			1.8			2.2		143.3
Unrealized	95.7		8.2			28.9			44.3		177.1
Total compensation and benefits	330.0		52.7			68.6			74.3		525.6
General, administrative, and other indirect expenses	31.7		12.3			14.6			7.9		66.5
Depreciation and amortization expense	2.7		1.1			0.9			0.8		5.5
Interest expense	7.6		2.8			2.7			1.5		14.6
Total expenses	372.0		68.9			86.8			84.5		612.2
Economic Net Income (Loss)	$	289.0	$	9.6		$	(33.4	)	$	7.5	$	272.7
(-) Net Performance Fees	274.0		12.8			(8.9		)	3.9		281.8
(-) Investment Income (Loss)	10.1		(2.6		)	(36.2		)	0.7		(28.0		)
(+) Equity-based Compensation	17.3		5.2			7.1			2.7		32.3
(=) Fee Related Earnings	$	22.2	$	4.6		$	18.8		$	5.6	$	51.2
(+) Realized Net Performance Fees	169.0		2.3			5.9			1.2		178.4
(+) Realized Investment Income (Loss)	2.7		1.6			(86.4		)	0.1		(82.0		)
(=) Distributable Earnings	$	193.9	$	8.5		$	(61.7	)	$	6.9	$	147.6
Segment assets as of March 31, 2015	$	3,927.1	$	908.4		$	1,556.0		$	728.5	$	7,120.0

The following table presents the financial data for the Partnership’s four reportable segments for the three months ended March 31, 2014:

	Three Months Ended March 31, 2014
	Corporate Private Equity		Global Market Strategies		Real Assets			Investment Solutions		Total
	(Dollars in millions)
Segment Revenues
Fund level fee revenues
Fund management fees	$	129.8	$	63.2	$	50.3		$	44.5	$	287.8
Portfolio advisory fees, net	3.5		0.1		0.2			—		3.8
Transaction fees, net	3.2		—		—			—		3.2
Total fund level fee revenues	136.5		63.3		50.5			44.5		294.8
Performance fees
Realized	234.7		8.3		0.5			5.9		249.4
Unrealized	212.9		49.5		14.0			79.3		355.7
Total performance fees	447.6		57.8		14.5			85.2		605.1
Investment income (loss)
Realized	1.9		1.3		2.1			—		5.3
Unrealized	5.4		1.9		(20.6		)	0.1		(13.2		)
Total investment income (loss)	7.3		3.2		(18.5		)	0.1		(7.9		)
Interest and other income	2.2		1.3		0.7			0.3		4.5
Total revenues	593.6		125.6		47.2			130.1		896.5
Segment Expenses
Compensation and benefits
Direct base compensation	59.5		27.5		18.7			21.0		126.7
Indirect base compensation	22.0		6.0		14.3			3.8		46.1
Equity-based compensation	7.1		2.7		3.5			0.7		14.0
Performance fee related
Realized	101.3		3.8		0.2			4.0		109.3
Unrealized	100.5		14.8		8.4			75.7		199.4
Total compensation and benefits	290.4		54.8		45.1			105.2		495.5
General, administrative, and other indirect expenses	35.4		11.6		15.5			9.2		71.7
Depreciation and amortization expense	2.7		0.9		0.9			0.9		5.4
Interest expense	6.7		2.1		2.2			1.2		12.2
Total expenses	335.2		69.4		63.7			116.5		584.8
Economic Net Income (Loss)	$	258.4	$	56.2	$	(16.5	)	$	13.6	$	311.7
(-) Net Performance Fees	245.8		39.2		5.9			5.5		296.4
(-) Investment Income (Loss)	7.3		3.2		(18.5		)	0.1		(7.9		)
(+) Equity-based Compensation	7.1		2.7		3.5			0.7		14.0
(=) Fee Related Earnings	$	12.4	$	16.5	$	(0.4	)	$	8.7	$	37.2
(+) Realized Net Performance Fees	133.4		4.5		0.3			1.9		140.1
(+) Realized Investment Income	1.9		1.3		2.1			—		5.3
(=) Distributable Earnings	$	147.7	$	22.3	$	2.0		$	10.6	$	182.6

Total segments to partnership income before provision for taxes reconciliation

The following table reconciles the Total Segments to the Partnership’s Income Before Provision for Taxes as of and for the three months ended March 31, 2015:

	March 31, 2015 and the Three Months Then Ended
	Total Reportable Segments		Consolidated Funds		Reconciling Items				Carlyle Consolidated
	(Dollars in millions)
Revenues	$	884.9	$	226.3	$	25.6		(a)	$	1,136.8
Expenses	$	612.2	$	292.8	$	122.0		(b)	$	1,027.0
Other income	$	—	$	507.8	$	(2.3	)	(c)	$	505.5
Economic net income	$	272.7	$	441.3	$	(98.7	)	(d)	$	615.3
Total assets	$	7,120.0	$	28,096.6	$	(203.4	)	(e)	$	35,013.2

The following table reconciles the Total Segments to the Partnership’s Income Before Provision for Taxes for the three months ended March 31, 2014:

	Three Months Ended March 31, 2014
	Total Reportable Segments		Consolidated Funds		Reconciling Items				Carlyle Consolidated
	(Dollars in millions)
Revenues	$	896.5	$	250.7	$	0.2		(a)	$	1,147.4
Expenses	$	584.8	$	339.8	$	174.4		(b)	$	1,099.0
Other income	$	—	$	426.9	$	(2.9	)	(c)	$	424.0
Economic net income	$	311.7	$	337.8	$	(177.1	)	(d)	$	472.4

(a) The Revenues adjustment principally represents fund management and performance fees earned from the Consolidated Funds which were eliminated in consolidation to arrive at the Partnership’s total revenues, adjustments for amounts attributable to non-controlling interests in consolidated entities, adjustments related to expenses associated with the investments in NGP Management and its affiliates that are included in operating captions or are excluded from the segment results, adjustments to reflect the Partnership’s share of Urbplan’s net losses as a component of investment income, and adjustments to reflect the Partnership’s ownership interests in Claren Road, ESG and Vermillion that were included in Revenues in the Partnership’s segment reporting.

(b) The Expenses adjustment represents the elimination of intercompany expenses of the Consolidated Funds payable to the Partnership, the inclusion of certain tax expenses associated with performance fee compensation, adjustments related to expenses associated with the investment in NGP Management that are included in operating captions, adjustments to reflect the Partnership’s share of Urbplan’s net losses as a component of investment income, charges and credits associated with Carlyle corporate actions and non-recurring items and adjustments to reflect the Partnership’s economic interests in Claren Road, ESG and Vermillion, as detailed below (Dollars in millions):

	Three Months Ended March 31,
	2015			2014
Equity-based compensation issued in conjunction with the initial public offering, acquisitions and strategic investments	$	59.0		$	62.4
Acquisition related charges and amortization of intangibles	40.6			80.1
Other non-operating expense	1.1			30.2
Tax expense associated with performance fee compensation	(5.2		)	(10.2		)
Non-Carlyle economic interests in acquired business	80.3			85.5
Other adjustments	1.2			2.3
Elimination of expenses of Consolidated Funds	(55.0		)	(75.9		)
	$	122.0		$	174.4

(c) The Other Income (Loss) adjustment results from the Consolidated Funds which were eliminated in consolidation to arrive at the Partnership’s total Other Income (Loss).

(d) The following table is a reconciliation of Income Before Provision for Income Taxes to Economic Net Income, to Fee Related Earnings, and to Distributable Earnings (Dollars in millions):

	Three Months Ended March 31,
	2015			2014
Income before provision for income taxes	$	615.3		$	472.4
Adjustments:
Equity-based compensation issued in conjunction with the initial public offering, acquisitions and strategic investments	59.0			62.4
Acquisition related charges and amortization of intangibles	40.6			80.1
Other non-operating expense	1.1			30.2
Tax expense associated with performance fee compensation	(5.2		)	(10.2		)
Net income attributable to non-controlling interests in Consolidated entities	(439.1		)	(324.5		)
Other adjustments	1.0			1.3
Economic Net Income	$	272.7		$	311.7
Net performance fees(1)	281.8			296.4
Investment loss(1)	(28.0		)	(7.9		)
Equity-based compensation	32.3			14.0
Fee Related Earnings	$	51.2		$	37.2
Realized performance fees, net of related compensation	178.4			140.1
Realized investment income (loss)(1)	(82.0		)	5.3
Distributable Earnings	$	147.6		$	182.6

(1) See reconciliation to most directly comparable U.S. GAAP measure below:

	Three Months Ended March 31, 2015
	Carlyle Consolidated			Adjustments (2)			Total Reportable Segments
	(Dollars in millions)
Performance fees
Realized	$	326.8		$	(5.1	)	$	321.7
Unrealized	246.2			34.3			280.5
Total performance fees	573.0			29.2			602.2
Performance fee related compensation expense
Realized	143.0			0.3			143.3
Unrealized	173.7			3.4			177.1
Total performance fee related compensation expense	316.7			3.7			320.4
Net performance fees
Realized	183.8			(5.4		)	178.4
Unrealized	72.5			30.9			103.4
Total net performance fees	$	256.3		$	25.5		$	281.8
Investment income (loss)
Realized	$	8.9		$	(90.9	)	$	(82.0	)
Unrealized	(2.1		)	56.1			54.0
Investment income (loss)	$	6.8		$	(34.8	)	$	(28.0	)

	Three Months Ended March 31, 2014
	Carlyle Consolidated		Adjustments (2)			Total Reportable Segments
	(Dollars in millions)
Performance fees
Realized	$	251.4	$	(2.0	)	$	249.4
Unrealized	369.1		(13.4		)	355.7
Total performance fees	620.5		(15.4		)	605.1
Performance fee related compensation expense
Realized	108.7		0.6			109.3
Unrealized	221.6		(22.2		)	199.4
Total performance fee related compensation expense	330.3		(21.6		)	308.7
Net performance fees
Realized	142.7		(2.6		)	140.1
Unrealized	147.5		8.8			156.3
Total net performance fees	$	290.2	$	6.2		$	296.4
Investment income (loss)
Realized	$	—	$	5.3		$	5.3
Unrealized	6.1		(19.3		)	(13.2		)
Total investment income (loss)	$	6.1	$	(14.0	)	$	(7.9	)

(2) Adjustments to performance fees and investment income (loss) relate to (i) amounts earned from the Consolidated Funds, which were eliminated in the U.S. GAAP consolidation but were included in the segment results, (ii) amounts attributable to non-controlling interests in consolidated entities, which were excluded from the segment results and (iii) the reclassification of NGP X performance fees, which are included in investment income in U.S. GAAP financial statements. Adjustments to investment income (loss) also include the reclassification of earnings for the investments in NGP Management and its affiliates to the appropriate operating captions for the segment results, the exclusion of charges associated with the investment in NGP Management and its affiliates that are excluded from the segment results, and adjustments to reflect the Partnership’s share of Urbplan’s net losses as investment losses for the segment results. Adjustments to performance fee related compensation expense relate to certain tax expenses associated with performance fee compensation. Adjustments are also included in these financial statement captions to reflect the Partnership’s 55% economic interest in each of Claren Road, ESG and Vermillion.

(e) The Total Assets adjustment represents the addition of the assets of the Consolidated Funds that were eliminated in consolidation to arrive at the Partnership’s total assets.

Expenses adjustment representing elimination of intercompany expenses

The Expenses adjustment represents the elimination of intercompany expenses of the Consolidated Funds payable to the Partnership, the inclusion of certain tax expenses associated with performance fee compensation, adjustments related to expenses associated with the investment in NGP Management that are included in operating captions, adjustments to reflect the Partnership’s share of Urbplan’s net losses as a component of investment income, charges and credits associated with Carlyle corporate actions and non-recurring items and adjustments to reflect the Partnership’s economic interests in Claren Road, ESG and Vermillion, as detailed below (Dollars in millions):

	Three Months Ended March 31,
	2015			2014
Equity-based compensation issued in conjunction with the initial public offering, acquisitions and strategic investments	$	59.0		$	62.4
Acquisition related charges and amortization of intangibles	40.6			80.1
Other non-operating expense	1.1			30.2
Tax expense associated with performance fee compensation	(5.2		)	(10.2		)
Non-Carlyle economic interests in acquired business	80.3			85.5
Other adjustments	1.2			2.3
Elimination of expenses of Consolidated Funds	(55.0		)	(75.9		)
	$	122.0		$	174.4

Reconciliation of income before provision for income taxes

The following table is a reconciliation of Income Before Provision for Income Taxes to Economic Net Income, to Fee Related Earnings, and to Distributable Earnings (Dollars in millions):

	Three Months Ended March 31,
	2015			2014
Income before provision for income taxes	$	615.3		$	472.4
Adjustments:
Equity-based compensation issued in conjunction with the initial public offering, acquisitions and strategic investments	59.0			62.4
Acquisition related charges and amortization of intangibles	40.6			80.1
Other non-operating expense	1.1			30.2
Tax expense associated with performance fee compensation	(5.2		)	(10.2		)
Net income attributable to non-controlling interests in Consolidated entities	(439.1		)	(324.5		)
Other adjustments	1.0			1.3
Economic Net Income	$	272.7		$	311.7
Net performance fees(1)	281.8			296.4
Investment loss(1)	(28.0		)	(7.9		)
Equity-based compensation	32.3			14.0
Fee Related Earnings	$	51.2		$	37.2
Realized performance fees, net of related compensation	178.4			140.1
Realized investment income (loss)(1)	(82.0		)	5.3
Distributable Earnings	$	147.6		$	182.6

(1) See reconciliation to most directly comparable U.S. GAAP measure below:

	Three Months Ended March 31, 2015
	Carlyle Consolidated			Adjustments (2)			Total Reportable Segments
	(Dollars in millions)
Performance fees
Realized	$	326.8		$	(5.1	)	$	321.7
Unrealized	246.2			34.3			280.5
Total performance fees	573.0			29.2			602.2
Performance fee related compensation expense
Realized	143.0			0.3			143.3
Unrealized	173.7			3.4			177.1
Total performance fee related compensation expense	316.7			3.7			320.4
Net performance fees
Realized	183.8			(5.4		)	178.4
Unrealized	72.5			30.9			103.4
Total net performance fees	$	256.3		$	25.5		$	281.8
Investment income (loss)
Realized	$	8.9		$	(90.9	)	$	(82.0	)
Unrealized	(2.1		)	56.1			54.0
Investment income (loss)	$	6.8		$	(34.8	)	$	(28.0	)

	Three Months Ended March 31, 2014
	Carlyle Consolidated		Adjustments (2)			Total Reportable Segments
	(Dollars in millions)
Performance fees
Realized	$	251.4	$	(2.0	)	$	249.4
Unrealized	369.1		(13.4		)	355.7
Total performance fees	620.5		(15.4		)	605.1
Performance fee related compensation expense
Realized	108.7		0.6			109.3
Unrealized	221.6		(22.2		)	199.4
Total performance fee related compensation expense	330.3		(21.6		)	308.7
Net performance fees
Realized	142.7		(2.6		)	140.1
Unrealized	147.5		8.8			156.3
Total net performance fees	$	290.2	$	6.2		$	296.4
Investment income (loss)
Realized	$	—	$	5.3		$	5.3
Unrealized	6.1		(19.3		)	(13.2		)
Total investment income (loss)	$	6.1	$	(14.0	)	$	(7.9	)

Adjustments for performance fees, performance fee related compensation and investment income

See reconciliation to most directly comparable U.S. GAAP measure below:

	Three Months Ended March 31, 2015
	Carlyle Consolidated			Adjustments (2)			Total Reportable Segments
	(Dollars in millions)
Performance fees
Realized	$	326.8		$	(5.1	)	$	321.7
Unrealized	246.2			34.3			280.5
Total performance fees	573.0			29.2			602.2
Performance fee related compensation expense
Realized	143.0			0.3			143.3
Unrealized	173.7			3.4			177.1
Total performance fee related compensation expense	316.7			3.7			320.4
Net performance fees
Realized	183.8			(5.4		)	178.4
Unrealized	72.5			30.9			103.4
Total net performance fees	$	256.3		$	25.5		$	281.8
Investment income (loss)
Realized	$	8.9		$	(90.9	)	$	(82.0	)
Unrealized	(2.1		)	56.1			54.0
Investment income (loss)	$	6.8		$	(34.8	)	$	(28.0	)

	Three Months Ended March 31, 2014
	Carlyle Consolidated		Adjustments (2)			Total Reportable Segments
	(Dollars in millions)
Performance fees
Realized	$	251.4	$	(2.0	)	$	249.4
Unrealized	369.1		(13.4		)	355.7
Total performance fees	620.5		(15.4		)	605.1
Performance fee related compensation expense
Realized	108.7		0.6			109.3
Unrealized	221.6		(22.2		)	199.4
Total performance fee related compensation expense	330.3		(21.6		)	308.7
Net performance fees
Realized	142.7		(2.6		)	140.1
Unrealized	147.5		8.8			156.3
Total net performance fees	$	290.2	$	6.2		$	296.4
Investment income (loss)
Realized	$	—	$	5.3		$	5.3
Unrealized	6.1		(19.3		)	(13.2		)
Total investment income (loss)	$	6.1	$	(14.0	)	$	(7.9	)

(2) Adjustments to performance fees and investment income (loss) relate to (i) amounts earned from the Consolidated Funds, which were eliminated in the U.S. GAAP consolidation but were included in the segment results, (ii) amounts attributable to non-controlling interests in consolidated entities, which were excluded from the segment results and (iii) the reclassification of NGP X performance fees, which are included in investment income in U.S. GAAP financial statements. Adjustments to investment income (loss) also include the reclassification of earnings for the investments in NGP Management and its affiliates to the appropriate operating captions for the segment results, the exclusion of charges associated with the investment in NGP Management and its affiliates that are excluded from the segment results, and adjustments to reflect the Partnership’s share of Urbplan’s net losses as investment losses for the segment results. Adjustments to performance fee related compensation expense relate to certain tax expenses associated with performance fee compensation. Adjustments are also included in these financial statement captions to reflect the Partnership’s 55% economic interest in each of Claren Road, ESG and Vermillion.

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Summary of Significant Accounting Policies (Tables)

3 Months Ended

Mar. 31, 2015

Accounting Policies [Abstract]

Schedule of assets recognized and Partnership's maximum exposure to loss

The assets recognized in the Partnership’s condensed consolidated balance sheets related to the Partnership’s interests in these non-consolidated VIEs and the Partnership’s maximum exposure to loss relating to non-consolidated VIEs were as follows:

	As of
	March 31, 2015		December 31, 2014
	(Dollars in millions)
Investments	$	521.2	$	511.8
Receivables	7.3		3.7
Maximum Exposure to Loss	$	528.5	$	515.5

Components of accumulated other comprehensive income (loss)

The components of accumulated other comprehensive income (loss) as of March 31, 2015 and December 31, 2014 were as follows:

	As of
	March 31, 2015			December 31, 2014
	(Dollars in millions)
Unrealized losses on cash flow hedge instruments	$	(0.8	)	$	(0.9	)
Currency translation adjustments	(47.9		)	(35.8		)
Unrealized losses on defined benefit plans	(1.7		)	(2.3		)
Total	$	(50.4	)	$	(39.0	)

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Summary of Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2015

Accounting Policies [Abstract]

Principles of Consolidation

Principles of Consolidation

The Partnership consolidates all entities that it controls through a majority voting interest or otherwise. In addition, the accompanying condensed consolidated financial statements consolidate: (1) Carlyle-affiliated funds and co-investment entities, for which the Partnership is the sole general partner and the presumption of control by the general partner has not been overcome and (2) variable interest entities (“VIEs”), including certain CLOs and a real estate development company, for which the Partnership is deemed to be the primary beneficiary; consolidation of these entities is a requirement under U.S. GAAP. All significant inter-entity transactions and balances have been eliminated.

For entities that are determined to be VIEs, the Partnership consolidates those entities where it is deemed to be the primary beneficiary. An entity is determined to be the primary beneficiary if it holds a controlling financial interest. A controlling financial interest is defined as (a) the power to direct the activities of a VIE that most significantly impact the entity’s business and (b) the obligation to absorb losses of the entity or the right to receive benefits from the entity that could potentially be significant to the VIE. The revised consolidation rules require an analysis to (a) determine whether an entity in which the Partnership holds a variable interest is a VIE and (b) whether the Partnership’s involvement, through holding interests directly or indirectly in the entity or contractually through other variable interests (e.g., management and performance related fees), would give it a controlling financial interest. In evaluating whether the Partnership is the primary beneficiary, the Partnership evaluates its economic interests in the entity held either directly or indirectly by the Partnership. The consolidation analysis is generally performed qualitatively. This analysis, which requires judgment, is performed at each reporting date.

In February 2010, Accounting Standards Update (“ASU”) No. 2010-10, “Amendments for Certain Investment Funds,” was issued. This ASU defers the application of the revised consolidation rules for a reporting enterprise’s interest in an entity if certain conditions are met, including if the entity has the attributes of an investment company and is not a securitization or asset-backed financing entity. An entity that qualifies for the deferral will continue to be assessed for consolidation under the overall guidance on VIEs, before its amendment, and other applicable consolidation guidance.

As of March 31, 2015, assets and liabilities of consolidated VIEs reflected in the condensed consolidated balance sheets were $24.2 billion and $18.3 billion, respectively. Except to the extent of the assets of the VIEs which are consolidated, the holders of the consolidated VIEs’ liabilities generally do not have recourse to the Partnership. The assets and liabilities of the consolidated VIEs that are Consolidated Funds are comprised primarily of investments and loans payable, respectively.

The loans payable issued by the CLOs are backed by diversified collateral asset portfolios consisting primarily of loans or structured debt. In exchange for managing the collateral for the CLOs, the Partnership earns investment management fees, including in some cases subordinated management fees and contingent incentive fees. In cases where the Partnership consolidates the CLOs, those management fees have been eliminated as intercompany transactions. As of March 31, 2015, the Partnership held $169.3 million of investments in these CLOs which represent its maximum risk of loss. The Partnership’s investments in these CLOs are generally subordinated to other interests in the entities and entitle the Partnership to receive a pro rata portion of the residual cash flows, if any, from the entities. Investors in the CLOs have no recourse against the Partnership for any losses sustained in the CLO structure.

For all Carlyle-affiliated funds and co-investment entities (collectively “the funds”) that are not determined to be VIEs, the Partnership consolidates those funds where, as the sole general partner, it has not overcome the presumption of control pursuant to U.S. GAAP. Most Carlyle funds provide a dissolution right upon a simple majority vote of the non-Carlyle affiliated limited partners such that the presumption of control by Carlyle is overcome. Accordingly, these funds are not consolidated in the Partnership’s condensed consolidated financial statements.

Investments in Unconsolidated Variable Interest Entities

Investments in Unconsolidated Variable Interest Entities

The Partnership holds variable interests in certain VIEs that are not consolidated because the Partnership is not the primary beneficiary, including its strategic investment in NGP Management Company, L.L.C. (“NGP Management” and, together with its affiliates, “NGP”). Refer to Note 6 for information on this investment. The Partnership’s involvement with such entities is in the form of direct equity interests and fee arrangements. The maximum exposure to loss represents the loss of assets recognized by the Partnership relating to these unconsolidated entities.

Basis of Accounting

Basis of Accounting

The accompanying financial statements are prepared in accordance with U.S. GAAP. Management has determined that the Partnership’s Funds are investment companies under U.S. GAAP for the purposes of financial reporting. U.S. GAAP for an investment company requires investments to be recorded at estimated fair value and the unrealized gains and/or losses in an investment’s fair value are recognized on a current basis in the statements of operations. Additionally, the Funds do not consolidate their majority-owned and controlled investments (the “Portfolio Companies”). In the preparation of these condensed consolidated financial statements, the Partnership has retained the specialized accounting for the Funds.

All of the investments held and notes issued by the Consolidated Funds are presented at their estimated fair values in the Partnership’s condensed consolidated balance sheets. Interest and other income of the Consolidated Funds as well as interest expense and other expenses of the Consolidated Funds are included in the Partnership’s condensed consolidated statements of operations. The excess of the CLO assets over the CLO liabilities upon consolidation is reflected in the Partnership’s condensed consolidated balance sheets as partners’ capital appropriated for Consolidated Funds. Net income attributable to the investors in the CLOs is included in net income (loss) attributable to non-controlling interests in consolidated entities in the condensed consolidated statements of operations and partners’ capital appropriated for Consolidated Funds in the condensed consolidated balance sheets.

Use of Estimates

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make assumptions and estimates that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Management’s estimates are based on historical experiences and other factors, including expectations of future events that management believes to be reasonable under the circumstances. It also requires management to exercise judgment in the process of applying the Partnership’s accounting policies. Assumptions and estimates regarding the valuation of investments and their resulting impact on performance fees involve a higher degree of judgment and complexity and these assumptions and estimates may be significant to the consolidated financial statements and the resulting impact on performance fees. Actual results could differ from these estimates and such differences could be material.

Business Combinations

Business Combinations

The Partnership accounts for business combinations using the acquisition method of accounting, under which the purchase price of the acquisition is allocated to the assets acquired and liabilities assumed using the fair values determined by management as of the acquisition date. Contingent consideration obligations that are elements of consideration transferred are recognized as of the acquisition date as part of the fair value transferred in exchange for the acquired business. Acquisition-related costs incurred in connection with a business combination are expensed.

Revenue Recognition

Revenue Recognition

Fund Management Fees

The Partnership provides management services to funds in which it holds a general partner interest or has a management agreement. For corporate private equity, certain global market strategies funds and real assets funds, management fees are calculated based on (a) limited partners’ capital commitments to the funds, (b) limited partners’ remaining capital invested in the funds at cost or at the lower of cost or aggregate remaining fair value, (c) gross assets, excluding cash and cash equivalents or (d) the net asset value (“NAV”) of certain of the funds, less offsets for the non-affiliated limited partners’ share of transaction advisory and portfolio fees earned, as defined in the respective partnership agreements.

Management fees for corporate private equity, closed-end carry funds in the global market strategies segment and real assets funds generally range from 1% to 2% of commitments during the investment period of the relevant fund. Following the expiration or termination of the investment period of such funds, the management fees generally step-down to between 0.6% and 2.0% generally on the lower of cost or fair value of capital invested; however, certain of our managed accounts base management fees at all times on contributions for unrealized investments or the current value of the investment. The Partnership will receive management fees for corporate private equity and real assets funds during a specified period of time, which is generally ten years from the initial closing date, or, in some instances, from the final closing date, but such termination date may be earlier in certain limited circumstances or later if extended for successive one-year periods, typically up to a maximum of two years. Depending upon the contracted terms of investment advisory or investment management and related agreements, these fees are generally called semi-annually in advance and are recognized as earned over the subsequent six month period.

For certain global market strategies funds, management fees are calculated based on assets under management of the funds with generally lower fee rates. Hedge funds typically pay management fees quarterly that generally range from 1.5% to 2.0% of NAV per year. Management fees for the business development companies are due quarterly in arrears at annual rates that range from 0.25% to 1.0% of gross assets, excluding cash and cash equivalents. Management fees for the CLOs and other structured products typically range from 0.15% to 1.0% on the total par amount of assets or the aggregate principal amount of the notes in the CLO and are due quarterly or semi-annually based on the terms and recognized over the respective period. Management fees for the CLOs/structured products and credit opportunities are governed by indentures and collateral management agreements. The Partnership will receive management fees for the CLOs until redemption of the securities issued by the CLOs, which is generally five to ten years after issuance. Open-ended funds typically do not have stated termination dates.

Management fees for our private equity and real estate fund of funds vehicles generally range from 0.3% to 1.0% on the vehicle’s capital commitments during the commitment fee period of the relevant fund or the weighted-average investment period of the underlying funds. Following the expiration of the commitment fee period or weighted-average investment period of such funds, the management fees generally range from 0.3% to 1.0% on the lower of cost or fair value of the capital invested, the net asset value for unrealized investments, or the contributions for unrealized investments. The management fees for our fund of hedge fund vehicles generally range from 0.2% to 1.5% of net asset value. Management fees for our Investment Solutions segment are generally due quarterly and recognized over the related quarter.

The Partnership also provides transaction advisory and portfolio advisory services to the Portfolio Companies, and where covered by separate contractual agreements, recognizes fees for these services when the service has been provided and collection is reasonably assured. Fund management fees includes transaction and portfolio advisory fees of $7.6 million and $7.0 million for the three months ended March 31, 2015 and 2014, respectively, net of any offsets as defined in the respective partnership agreements.

Performance Fees

Performance fees consist principally of the allocation of profits from certain of the funds to which the Partnership is entitled (commonly known as carried interest). The Partnership is generally entitled to a 20% allocation (or 10% to 20% on external coinvestment vehicles, with some earning no carried interest, or approximately 2% to 10% in the case of most of the Partnership’s fund of funds vehicles) of the net realized income or gain as a carried interest after returning the invested capital, the allocation of preferred returns of generally 8% to 9% and return of certain fund costs (generally subject to catch-up provisions as set forth in the fund limited partnership agreement) from its corporate private equity and real assets funds and closed-end carry funds in the global market strategies segment. Carried interest is recognized upon appreciation of the funds’ investment values above certain return hurdles set forth in each respective partnership agreement. The Partnership recognizes revenues attributable to performance fees based upon the amount that would be due pursuant to the fund partnership agreement at each period end as if the funds were terminated at that date. Accordingly, the amount recognized as performance fees reflects the Partnership’s share of the gains and losses of the associated funds’ underlying investments measured at their then-current fair values. Because of the inherent uncertainty, these estimated values may differ significantly from the values that would have been used had a ready market for the investments existed, and it is reasonably possible that the difference could be material.

Carried interest is ultimately realized when: (i) an underlying investment is profitably disposed of, (ii) certain costs borne by the limited partner investors have been reimbursed, (iii) the fund’s cumulative returns are in excess of the preferred return and (iv) the Partnership has decided to collect carry rather than return additional capital to limited partner investors. Realized carried interest may be required to be returned by the Partnership in future periods if the funds’ investment values decline below certain levels. When the fair value of a fund’s investments remains constant or falls below certain return hurdles, previously recognized performance fees are reversed. In all cases, each fund is considered separately in this regard, and for a given fund, performance fees can never be negative over the life of a fund. If upon a hypothetical liquidation of a fund’s investments at their then-current fair values, previously recognized and distributed carried interest would be required to be returned, a liability is established for the potential giveback obligation. As of March 31, 2015 and December 31, 2014, the Partnership has recognized $176.6 million and $104.4 million, respectively, for giveback obligations.

In addition to its performance fees from its corporate private equity and real assets funds and closed-end carry funds in the global market strategies segment, the Partnership is also entitled to receive performance fees from certain of its global market strategies funds and fund of funds vehicles when the return on assets under management exceeds certain benchmark returns or other performance targets. In such arrangements, performance fees are recognized when the performance benchmark has been achieved, and are included in performance fees in the accompanying condensed consolidated statements of operations.

Investment Income (Loss)

Investment income (loss) represents the unrealized and realized gains and losses resulting from the Partnership’s equity method investments and other principal investments. Equity method investment income (loss) includes the related amortization of the basis difference between the Partnership’s carrying value of its investment and the Partnership’s share of underlying net assets of the investee, as well as the compensation expense associated with compensatory arrangements provided by the Partnership to employees of its equity method investee. Investment income (loss) is realized when the Partnership redeems all or a portion of its investment or when the Partnership receives or is due cash income, such as dividends or distributions. Unrealized investment income (loss) results from changes in the fair value of the underlying investment as well as the reversal of unrealized gain (loss) at the time an investment is realized.

Interest Income

Interest income is recognized when earned. Interest income earned by the Partnership is included in interest and other income in the accompanying condensed consolidated statements of operations. Interest income of the Consolidated Funds was $208.4 million and $221.2 million for the three months ended March 31, 2015 and 2014, respectively, and is included in interest and other income of Consolidated Funds in the accompanying condensed consolidated statements of operations.

Compensation and Benefits

Compensation and Benefits

Base Compensation – Base compensation includes salaries, bonuses (discretionary awards and guaranteed amounts), performance payment arrangements and benefits paid and payable to Carlyle employees. Bonuses are accrued over the service period to which they relate.

Equity-Based Compensation – Compensation expense relating to the issuance of equity-based awards to Carlyle employees is measured at fair value on the grant date. The compensation expense for awards that vest over a future service period is recognized over the relevant service period on a straight-line basis, adjusted for estimated forfeitures of awards not expected to vest. The compensation expense for awards that do not require future service is recognized immediately. Upon the end of the service period, compensation expense is adjusted to account for the actual forfeiture rate. Cash settled equity-based awards are classified as liabilities and are re-measured at the end of each reporting period. The compensation expense for awards that contain performance conditions is recognized when it is probable that the performance conditions will be achieved; in certain instances, such compensation expense may be recognized prior to the grant date of the award.

Equity-based awards issued to non-employees are recognized as general, administrative and other expenses. The grant-date fair value of equity-based awards granted to Carlyle’s non-employee directors is expensed on a straight-line basis over the vesting period. The cost of services received in exchange for an equity-based award issued to consultants is measured at each vesting date, and is not measured based on the grant-date fair value of the award unless the award is vested at the grant date. Equity-based awards that require the satisfaction of future service criteria are recognized over the relevant service period, adjusted for estimated forfeitures of awards not expected to vest, based on the fair value of the award on each reporting date and adjusted for the actual fair value of the award at each vesting date. Accordingly, the measured value of the award will not be finalized until the vesting date.

Performance Fee Related Compensation – A portion of the performance fees earned is due to employees and advisors of the Partnership. These amounts are accounted for as compensation expense in conjunction with the recognition of the related performance fee revenue and, until paid, are recognized as a component of the accrued compensation and benefits liability. Accordingly, upon any reversal of performance fee revenue, the related compensation expense is also reversed.

Income Taxes

Income Taxes

Certain of the wholly-owned subsidiaries of the Partnership and the Carlyle Holdings partnerships are subject to federal, state, local and foreign corporate income taxes at the entity level and the related tax provision attributable to the Partnership’s share of this income is reflected in the condensed consolidated financial statements. Based on applicable foreign, state and local tax laws, the Partnership records a provision for income taxes for certain entities. Tax positions taken by the Partnership are subject to periodic audit by U.S. federal, state, local and foreign taxing authorities.

The Partnership accounts for income taxes under the provisions of Accounting Standards Codification (“ASC”) 740, Income Taxes (“ASC 740”), using the liability method. ASC 740 requires the recognition of deferred tax liabilities and assets for the expected future consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial statement reporting and the tax basis of assets and liabilities using enacted tax rates in effect for the period in which the difference is expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in the period of the change in the provision for income taxes. Further, deferred tax assets are recognized for the expected realization of available net operating loss and tax credit carry forwards. A valuation allowance is recorded on the Partnership’s gross deferred tax assets when it is “more likely than not” that such asset will not be realized. When evaluating the realizability of the Partnership’s deferred tax assets, all evidence, both positive and negative, is evaluated. Items considered in this analysis include the ability to carry back losses, the reversal of temporary differences, tax planning strategies, and expectations of future earnings.

Under U.S. GAAP for income taxes, the amount of tax benefit to be recognized is the amount of benefit that is “more likely than not” to be sustained upon examination. The Partnership analyzes its tax filing positions in all of the U.S. federal, state, local and foreign tax jurisdictions where it is required to file income tax returns, as well as for all open tax years in these jurisdictions. If, based on this analysis, the Partnership determines that uncertainties in tax positions exist, a liability is established, which is included in accounts payable, accrued expenses and other liabilities in the condensed consolidated financial statements. The Partnership recognizes accrued interest and penalties related to unrecognized tax positions in the provision for income taxes. If recognized, the entire amount of unrecognized tax positions would be recorded as a reduction in the provision for income taxes.

Tax Receivable Agreement

Tax Receivable Agreement

Exchanges of Carlyle Holdings partnership units for the Partnership’s common units that are executed by the limited partners of the Carlyle Holdings partnerships result in transfers of and increases in the tax basis of the tangible and intangible assets of Carlyle Holdings, primarily attributable to a portion of the goodwill inherent in the business. These transfers and increases in tax basis will increase (for tax purposes) depreciation and amortization and therefore reduce the amount of tax that certain of the Partnership’s subsidiaries, including Carlyle Holdings I GP Inc., which are referred to as the “corporate taxpayers,” would otherwise be required to pay in the future. This increase in tax basis may also decrease gain (or increase loss) on future dispositions of certain capital assets to the extent tax basis is allocated to those capital assets. The Partnership has entered into a tax receivable agreement with the limited partners of the Carlyle Holdings partnerships whereby the corporate taxpayers have agreed to pay to the limited partners of the Carlyle Holdings partnerships involved in any exchange transaction 85% of the amount of cash tax savings, if any, in U.S. federal, state and local income tax or foreign or franchise tax that the corporate taxpayers realize as a result of these increases in tax basis and, in limited cases, transfers or prior increases in tax basis. The corporate taxpayers expect to benefit from the remaining 15% of cash tax savings, if any, in income tax they realize. Payments under the tax receivable agreement will be based on the tax reporting positions that the Partnership will determine. The corporate taxpayers will not be reimbursed for any payments previously made under the tax receivable agreement if a tax basis increase is successfully challenged by the Internal Revenue Service.

The Partnership records an increase in deferred tax assets for the estimated income tax effects of the increases in tax basis based on enacted federal and state tax rates at the date of the exchange. To the extent that the Partnership estimates that the corporate taxpayers will not realize the full benefit represented by the deferred tax asset, based on an analysis that will consider, among other things, its expectation of future earnings, the Partnership will reduce the deferred tax asset with a valuation allowance and will assess the probability that the related liability owed under the tax receivable agreement will be paid. The Partnership records 85% of the estimated realizable tax benefit (which is the recorded deferred tax asset less any recorded valuation allowance) as an increase to the liability due under the tax receivable agreement, which is included in due to affiliates in the accompanying condensed consolidated financial statements. The remaining 15% of the estimated realizable tax benefit is initially recorded as an increase to the Partnership’s partners’ capital.

All of the effects to the deferred tax asset of changes in any of the Partnership’s estimates after the tax year of the exchange will be reflected in the provision for income taxes. Similarly, the effect of subsequent changes in the enacted tax rates will be reflected in the provision for income taxes.

Non-controlling Interests

Non-controlling Interests

Non-controlling interests in consolidated entities represent the component of equity in consolidated entities held by third-party investors. These interests are adjusted for general partner allocations and by subscriptions and redemptions in hedge funds which occur during the reporting period. Any change in ownership of a subsidiary while the controlling financial interest is retained is accounted for as an equity transaction between the controlling and non-controlling interests. Transaction costs incurred in connection with such changes in ownership of a subsidiary are recorded as a direct charge to partners’ capital.

Non-controlling interests related to hedge funds are subject to quarterly or monthly redemption by investors in these funds following the expiration of a specified period of time, or may be withdrawn subject to a redemption fee during the period when capital may not be withdrawn. As limited partners in these types of funds have been granted redemption rights, amounts relating to third-party interests in such consolidated funds are presented as redeemable non-controlling interests in consolidated entities within the condensed consolidated balance sheets. When redeemable amounts become contractually payable to investors, they are classified as a liability and included in other liabilities of Consolidated Funds in the condensed consolidated balance sheets.

Non-controlling interests in Carlyle Holdings relate to the ownership interests of the other limited partners of the Carlyle Holdings partnerships. The Partnership, through wholly-owned subsidiaries, is the sole general partner of Carlyle Holdings.  Accordingly, the Partnership consolidates Carlyle Holdings into its consolidated financial statements, and the other ownership interests in Carlyle Holdings are reflected as non-controlling interests in the Partnership’s condensed consolidated financial statements. Any change to the Partnership’s ownership interest in Carlyle Holdings while it retains the controlling financial interest in Carlyle Holdings is accounted for as a transaction within partners’ capital as a reallocation of ownership interests in Carlyle Holdings.

Earnings Per Common Unit

Earnings Per Common Unit

The Partnership computes earnings per common unit in accordance with ASC 260, Earnings Per Share (“ASC 260”). Basic earnings per common unit is calculated by dividing net income (loss) attributable to the common units of the Partnership by the weighted-average number of common units outstanding for the period. Diluted earnings per common unit reflects the assumed conversion of all dilutive securities. Net income (loss) attributable to the common units excludes net income (loss) and dividends attributable to any participating securities under the two-class method of ASC 260.

Investments

Investments

Investments include (i) the Partnership’s ownership interests (typically general partner interests) in the Funds, (ii) the investments held by the Consolidated Funds (all of which are presented at fair value in the Partnership’s condensed consolidated financial statements), (iii) strategic investments made by the Partnership and (iv) certain credit-oriented investments.

The valuation procedures utilized for investments of the Funds vary depending on the nature of the investment. The fair value of investments in publicly-traded securities is based on the closing price of the security with adjustments to reflect appropriate discounts if the securities are subject to restrictions.

The fair value of non-equity securities or other investments, which may include instruments that are not listed on an exchange, considers, among other factors, external pricing sources, such as dealer quotes or independent pricing services, recent trading activity or other information that, in the opinion of the Partnership, may not have been reflected in pricing obtained from external sources.

When valuing private securities or assets without readily determinable market prices, the Partnership gives consideration to operating results, financial condition, economic and/or market events, recent sales prices and other pertinent information. These valuation procedures may vary by investment but include such techniques as comparable public market valuation, comparable acquisition valuation and discounted cash flow analysis. Because of the inherent uncertainty, these estimated values may differ significantly from the values that would have been used had a ready market for the investments existed, and it is reasonably possible that the difference could be material. Furthermore, there is no assurance that, upon liquidation, the Partnership will realize the values presented herein.

Upon the sale of a security or other investment, the realized net gain or loss is computed on a weighted average cost basis, with the exception of the CLOs, which compute the realized net gain or loss on a first in, first out basis. Securities transactions are recorded on a trade date basis.

Equity-Method Investments

Equity-Method Investments

The Partnership accounts for all investments in which it has or is otherwise presumed to have significant influence, including investments in the unconsolidated Funds and strategic investments, using the equity method of accounting. The carrying value of equity-method investments is determined based on amounts invested by the Partnership, adjusted for the equity in earnings or losses of the investee allocated based on the respective partnership agreement, less distributions received. The Partnership evaluates its equity-method investments for impairment whenever events or changes in circumstances indicate that the carrying amounts of such investments may not be recoverable.

Cash and Cash Equivalents

Cash and Cash Equivalents

Cash and cash equivalents include cash held at banks and cash held for distributions, including temporary investments with original maturities of less than three months when purchased.

Cash and Cash Equivalents Held at Consolidated Funds

Cash and Cash Equivalents Held at Consolidated Funds

Cash and cash equivalents held at Consolidated Funds consists of cash and cash equivalents held by the Consolidated Funds, which, although not legally restricted, is not available to fund the general liquidity needs of the Partnership.

Restricted Cash

Restricted Cash

Restricted cash at March 31, 2015 and December 31, 2014 includes $18.7 million and $8.7 million, respectively, of cash received on behalf of certain non-consolidated Carlyle funds that was paid out in April 2015 and January 2015, respectively. Also included in restricted cash at March 31, 2015 and December 31, 2014 is €4.4 million ($4.8 million and $5.4 million as of March 31, 2015 and December 31, 2014, respectively) in escrow related to a tax contingency at one of the Partnership’s real estate funds (see Note 11). Also included in restricted cash at December 31, 2014 was $13.2 million which is no longer restricted at March 31, 2015. The remaining balance in restricted cash at March 31, 2015 and December 31, 2014 primarily represents cash held by the Partnership’s foreign subsidiaries due to certain government regulatory capital requirements.

Restricted Cash and Securities of Consolidated Funds

Restricted Cash and Securities of Consolidated Funds

Certain CLOs receive cash from various counterparties to satisfy collateral requirements on derivative transactions.

Derivative Instruments

Derivative Instruments

Derivative instruments are recognized at fair value in the condensed consolidated balance sheets with changes in fair value recognized in the condensed consolidated statements of operations for all derivatives not designated as hedging instruments. For all derivatives where hedge accounting is applied, effectiveness testing and other procedures to assess the ongoing validity of the hedges are performed at least quarterly. For instruments designated as cash flow hedges, the Partnership records changes in the estimated fair value of the derivative, to the extent that the hedging relationship is effective, in other comprehensive income (loss). If the hedging relationship for a derivative is determined to be ineffective, due to changes in the hedging instrument or the hedged items, the fair value of the portion of the hedging relationship determined to be ineffective will be recognized as a gain or loss in the condensed consolidated statements of operations.

Fixed Assets

Fixed Assets

Fixed assets consist of furniture, fixtures and equipment, leasehold improvements, and computer hardware and software and are stated at cost, less accumulated depreciation and amortization. Depreciation is recognized on a straight-line method over the assets’ estimated useful lives, which for leasehold improvements are the lesser of the lease terms or the life of the asset, and three to seven years for other fixed assets. Fixed assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

Intangible Assets and Goodwill

Intangible Assets and Goodwill

The Partnership’s intangible assets consist of acquired contractual rights to earn future fee income, including management and advisory fees, customer relationships, and acquired trademarks. Finite-lived intangible assets are amortized over their estimated useful lives, which range from three to ten years, and are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable.

Goodwill represents the excess of cost over the identifiable net assets of businesses acquired and is recorded in the functional currency of the acquired entity. Goodwill is recognized as an asset and is reviewed for impairment annually as of October 1st and between annual tests when events and circumstances indicate that impairment may have occurred.

Deferred Revenue

Deferred Revenue

Deferred revenue represents management fees and other revenue received prior to the balance sheet date, which has not yet been earned.

Comprehensive Income (Loss)

Comprehensive Income (Loss)

Comprehensive income (loss) consists of net income (loss) and other comprehensive income (loss). The Partnership’s other comprehensive income (loss) is comprised of unrealized gains and losses on cash flow hedges, foreign currency translation adjustments and gains and losses on defined benefit plans sponsored by AlpInvest.

Foreign Currency Translation

Foreign Currency Translation

Non-U.S. dollar denominated assets and liabilities are translated at period-end rates of exchange, and the condensed consolidated statements of operations are translated at rates of exchange in effect throughout the period.

Recent Accounting Pronouncements

Recent Accounting Pronouncements

On April 7, 2015, the FASB issued ASU 2015-3, Interest - Imputation of Interest (Subtopic 835-30) - Simplifying the Presentation of Debt Issuance Costs. ASU 2015-3 requires debt issuance costs related to a recognized debt liability to be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts and premiums. This guidance is effective for the Partnership on January 1, 2016 and the ASU requires the guidance to be applied on a retrospective basis. This guidance is not expected to have a material impact on the Partnership's consolidated financial statements upon adoption.

On February 18, 2015, the FASB issued ASU 2015-2, Consolidation (Topic 820): Amendments to the Consolidation Analysis. ASU 2015-2 provides a revised consolidation model for all reporting entities to use in evaluating whether they should consolidate certain legal entities. All legal entities will be subject to reevaluation under this revised consolidation model. The revised consolidation model, among other things, (i) modifies the evaluation of whether limited partnerships and similar legal entities are VIEs or voting interest entities, (ii) eliminates the presumption that a general partner should consolidate a limited partnership, and (iii) modifies the consolidation analysis of reporting entities that are involved with VIEs through fee arrangements and related party relationships. This guidance in ASU 2015-2 is effective for the Partnership beginning on January 1, 2016; however, early adoption is permitted. The Partnership is currently assessing the potential impact that this guidance will have on its consolidated financial statements.

In August 2014, the FASB issued ASU 2014-13, Consolidation (Topic 810): Measuring the Financial Assets and the Financial Liabilities of a Consolidated Collateralized Financing Entity. ASU 2014-13 relates to reporting entities that elect to measure all eligible financial assets and financial liabilities of a consolidated collateralized financing entity at fair value. Under the Partnership's current practice, the difference between the fair value of the financial assets and the fair value of the financial liabilities is classified within partners’ capital appropriated for Consolidated Funds. ASU 2014-13 requires the reporting entity to initially measure both the financial assets and financial liabilities using the fair value of the financial assets or financial liabilities, whichever is more observable. As a result, the reporting entity will no longer have a difference to report within appropriated partners’ capital. This guidance is effective for the Partnership on January 1, 2016. The Partnership’s consolidated CLOs are consolidated collateralized financing entities for which the Partnership has measured financial assets and financial liabilities at fair value. The guidance is expected to change the measurement of the financial assets or financial liabilities of the Partnership's consolidated CLOs, which will impact net income but not impact net income attributable to the Partnership. Upon adoption, substantially all the balance within partners' capital appropriated for Consolidated Funds will be reclassified to investments of Consolidated Funds or loans payable of Consolidated Funds. At March 31, 2015 partners' capital appropriated for Consolidated Funds was $126.9 million.

In May 2014, the FASB issued ASU 2014-9, Revenue from Contracts with Customers (Topic 606). ASU 2014-9 provides comprehensive guidance for recognizing revenue from contracts with customers. Entities will be able to recognize revenue when the entity transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. The guidance includes a five-step framework that requires an entity to: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when the entity satisfies a performance obligation. The guidance in ASU 2014-9 is effective for the Partnership beginning on January 1, 2017. However, in April 2015, the FASB issued an exposure draft that, if ratified, would delay the implementation by a year. The Partnership is still assessing the potential impact of this guidance, however, this may have a material impact on the Partnership's consolidated financial statements by significantly delaying the recognition of performance fee revenue.

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Consolidation of a Real Estate Development Company - Outstanding Principal Amounts on Loans (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2015
Long-term Debt, Fiscal Year Maturity [Abstract]
2015	$ 27.6
2016	24.3
2017	19.1
2018	16.5
2019	19.1
Thereafter	108.2
Long-term Debt, Total	$ 214.8

XML

Fair Value Measurement - Financial Instruments Measured at Fair Value (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Balance, beginning of period	$ 21,783.6	$ 21,864.1
Transfers in		4.5
Transfers out		(87.5)
Purchases	1,808.5	2,034.2
Sales	(1,283.2)	(1,206.1)
Settlements	(440.9)	(1,177.8)
Included in earnings	425.1	255.6
Included in other comprehensive income	(968.2)	85.0
Balance, end of period	21,324.9	21,772.0
Changes in unrealized gains (losses) included in earnings related to financial assets still held at the reporting date	10.1	(169.0)
Equity securities
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Balance, beginning of period	1,968.5	2,714.1
Transfers in		4.5
Transfers out		(87.5)
Purchases	12.7	14.4
Sales	(599.6)	(240.3)
Settlements	0	0
Included in earnings	188.3	62.9
Included in other comprehensive income	(176.6)	16.9
Balance, end of period	1,393.3	2,485.0
Changes in unrealized gains (losses) included in earnings related to financial assets still held at the reporting date	(90.2)	(88.7)
Bonds
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Balance, beginning of period	1,235.8	1,249.5
Transfers in		0
Transfers out		0
Purchases	93.4	99.0
Sales	(68.5)	(138.8)
Settlements	0	0
Included in earnings	11.9	14.9
Included in other comprehensive income	(123.3)	(0.7)
Balance, end of period	1,149.3	1,223.9
Changes in unrealized gains (losses) included in earnings related to financial assets still held at the reporting date	11.1	13.7
Loans
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Balance, beginning of period	15,084.9	14,067.8
Transfers in		0
Transfers out		0
Purchases	1,628.2	1,787.0
Sales	(343.2)	(372.5)
Settlements	(440.9)	(1,177.8)
Included in earnings	32.8	23.0
Included in other comprehensive income	(522.4)	(2.9)
Balance, end of period	15,439.4	14,324.6
Changes in unrealized gains (losses) included in earnings related to financial assets still held at the reporting date	39.8	10.0
Partnership and LLC interests
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Balance, beginning of period	3,481.0	3,815.2
Transfers in		0
Transfers out		0
Purchases	70.3	133.8
Sales	(271.9)	(450.9)
Settlements	0	0
Included in earnings	191.1	153.8
Included in other comprehensive income	(145.7)	71.7
Balance, end of period	3,324.8	3,723.6
Changes in unrealized gains (losses) included in earnings related to financial assets still held at the reporting date	62.2	(105.0)
Other
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Balance, beginning of period	1.5	2.0
Transfers in		0
Transfers out		0
Purchases	0	0
Sales	0	0
Settlements	0	0
Included in earnings	2.0	(0.6)
Included in other comprehensive income	(0.2)	0
Balance, end of period	3.3	1.4
Changes in unrealized gains (losses) included in earnings related to financial assets still held at the reporting date	(11.8)	(0.6)
Trading securities and other
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Balance, beginning of period	3.3	6.9
Transfers in		0
Transfers out		0
Purchases	0	0
Sales	0	(3.6)
Settlements	0	0
Included in earnings	(1.1)	1.9
Included in other comprehensive income	0	0
Balance, end of period	2.2	5.2
Changes in unrealized gains (losses) included in earnings related to financial assets still held at the reporting date	(1.1)	1.9
Restricted securities of Consolidated Funds
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Balance, beginning of period	8.6	8.6
Transfers in		0
Transfers out		0
Purchases	3.9	0
Sales	0	0
Settlements		0
Included in earnings	0.1	(0.3)
Included in other comprehensive income	0	0
Balance, end of period	12.6	8.3
Changes in unrealized gains (losses) included in earnings related to financial assets still held at the reporting date	$ 0.1	$ (0.3)

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Supplemental Financial Information (Tables)

3 Months Ended

Mar. 31, 2015

Condensed Financial Information of Parent Company Only Disclosure [Abstract]

Supplemental financial Position

The following supplemental financial information illustrates the consolidating effects of the Consolidated Funds on the Partnership’s financial position as of March 31, 2015 and December 31, 2014 and results of operations for the three months ended March 31, 2015 and 2014. The supplemental statement of cash flows is presented without effects of the Consolidated Funds.

	As of March 31, 2015
	Consolidated Operating Entities			Consolidated Funds			Eliminations			Consolidated
	(Dollars in millions)
Assets
Cash and cash equivalents	$	1,024.8		$	—		$	—		$	1,024.8
Cash and cash equivalents held at Consolidated Funds	—			1,436.7			—			1,436.7
Restricted cash	41.0			—			—			41.0
Restricted cash and securities of Consolidated Funds	—			18.8			—			18.8
Accrued performance fees	3,780.1			—			(12.9		)	3,767.2
Investments	1,119.3			—			(175.1		)	944.2
Investments of Consolidated Funds	—			25,949.0			0.1			25,949.1
Due from affiliates and other receivables, net	218.3			—			(15.5		)	202.8
Due from affiliates and other receivables of Consolidated Funds, net	—			688.9			—			688.9
Receivables and inventory of a consolidated real estate VIE	185.0			—			—			185.0
Fixed assets, net	86.7			—			—			86.7
Deposits and other	57.7			3.2			—			60.9
Other assets of a consolidated real estate VIE	73.7			—			—			73.7
Intangible assets, net	399.3			—			—			399.3
Deferred tax assets	134.1			—			—			134.1
Total assets	$	7,120.0		$	28,096.6		$	(203.4	)	$	35,013.2
Liabilities and partners’ capital
Loans payable	$	38.4		$	—		$	—		$	38.4
3.875% senior notes due 2023	499.9			—			—			499.9
5.625% senior notes due 2043	606.8			—			—			606.8
Loans payable of Consolidated Funds	—			16,721.9			(167.3		)	16,554.6
Loans payable of a consolidated real estate VIE at fair value (principal amount of $214.8 million)	139.6			—			—			139.6
Accounts payable, accrued expenses and other liabilities	469.1			—			(79.2		)	389.9
Accrued compensation and benefits	2,202.0			—			—			2,202.0
Due to affiliates	191.3			0.2			—			191.5
Deferred revenue	196.7			—			(0.2		)	196.5
Deferred tax liabilities	105.0			—			—			105.0
Other liabilities of Consolidated Funds	—			1,751.3			(42.6		)	1,708.7
Other liabilities of a consolidated real estate VIE	105.4			—			—			105.4
Accrued giveback obligations	184.5			—			(7.9		)	176.6
Total liabilities	4,738.7			18,473.4			(297.2		)	22,914.9
Redeemable non-controlling interests in consolidated entities	8.0			3,931.9			—			3,939.9
Partners’ capital	528.0			(111.5		)	111.5			528.0
Accumulated other comprehensive income (loss)	(52.8		)	12.4			(10.0		)	(50.4		)
Partners’ capital appropriated for Consolidated Funds	—			134.6			(7.7		)	126.9
Non-controlling interests in consolidated entities	269.9			5,655.8			—			5,925.7
Non-controlling interests in Carlyle Holdings	1,628.2			—			—			1,628.2
Total partners’ capital	2,373.3			5,691.3			93.8			8,158.4
Total liabilities and partners’ capital	$	7,120.0		$	28,096.6		$	(203.4	)	$	35,013.2

	As of December 31, 2014
	Consolidated Operating Entities			Consolidated Funds			Eliminations			Consolidated
	(Dollars in millions)
Assets
Cash and cash equivalents	$	1,242.0		$	—		$	—		$	1,242.0
Cash and cash equivalents held at Consolidated Funds	—			1,551.1			—			1,551.1
Restricted cash	59.7			—			—			59.7
Restricted cash and securities of Consolidated Funds	—			14.9			—			14.9
Accrued performance fees	3,808.9			—			(13.3		)	3,795.6
Investments	1,114.9			—			(183.3		)	931.6
Investments of Consolidated Funds	—			26,028.7			0.1			26,028.8
Due from affiliates and other receivables, net	215.8			—			(16.4		)	199.4
Due from affiliates and other receivables of Consolidated Funds, net	—			1,213.2			—			1,213.2
Receivables and inventory of a consolidated real estate VIE	163.9			—			—			163.9
Fixed assets, net	75.4			—			—			75.4
Deposits and other	57.3			1.9			—			59.2
Other assets of a consolidated real estate VIE	86.4			—			—			86.4
Intangible assets, net	442.1			—			—			442.1
Deferred tax assets	131.0			—			—			131.0
Total assets	$	7,397.4		$	28,809.8		$	(212.9	)	$	35,994.3
Liabilities and partners’ capital
Loans payable	$	40.2		$	—		$	—		$	40.2
3.875% senior notes due 2023	499.9			—			—			499.9
5.625% senior notes due 2043	606.8			—			—			606.8
Loans payable of Consolidated Funds	—			16,219.8			(167.6		)	16,052.2
Loans payable of a consolidated real estate VIE at fair value (principal amount of $243.6 million)	146.2			—			—			146.2
Accounts payable, accrued expenses and other liabilities	446.8			—			(50.6		)	396.2
Accrued compensation and benefits	2,312.5			—			—			2,312.5
Due to affiliates	183.6			1.0			(0.4		)	184.2
Deferred revenue	93.9			—			(0.2		)	93.7
Deferred tax liabilities	112.2			—			—			112.2
Other liabilities of Consolidated Funds	—			2,548.0			(43.1		)	2,504.9
Other liabilities of a consolidated real estate VIE	84.9			—			—			84.9
Accrued giveback obligations	113.4			—			(9.0		)	104.4
Total liabilities	4,640.4			18,768.8			(270.9		)	23,138.3
Redeemable non-controlling interests in consolidated entities	8.4			3,753.1			—			3,761.5
Partners’ capital	566.0			(71.5		)	71.5			566.0
Accumulated other comprehensive income (loss)	(40.3		)	6.3			(5.0		)	(39.0		)
Partners’ capital appropriated for Consolidated Funds	—			193.0			(8.5		)	184.5
Non-controlling interests in consolidated entities	286.3			6,160.1			—			6,446.4
Non-controlling interests in Carlyle Holdings	1,936.6			—			—			1,936.6
Total partners’ capital	2,748.6			6,287.9			58.0			9,094.5
Total liabilities and partners’ capital	$	7,397.4		$	28,809.8		$	(212.9	)	$	35,994.3

Supplemental results of operations

	Three Months Ended March 31, 2015
	Consolidated Operating Entities			Consolidated Funds		Eliminations			Consolidated
	(Dollars in millions)
Revenues
Fund management fees	$	309.7		$	—	$	(40.2	)	$	269.5
Performance fees
Realized	326.0			—		0.8			326.8
Unrealized	254.5			—		(8.3		)	246.2
Total performance fees	580.5			—		(7.5		)	573.0
Investment income (loss)
Realized	(69.8		)	—		78.7			8.9
Unrealized	45.6			—		(47.7		)	(2.1		)
Investment income (loss)	(24.2		)	—		31.0			6.8
Interest and other income	6.5			—		(0.5		)	6.0
Interest and other income of Consolidated Funds	—			226.3		—			226.3
Revenue of a consolidated real estate VIE	55.2			—		—			55.2
Total revenues	927.7			226.3		(17.2		)	1,136.8
Expenses
Compensation and benefits
Base compensation	180.1			—		—			180.1
Equity-based compensation	89.9			—		—			89.9
Performance fee related
Realized	143.0			—		—			143.0
Unrealized	173.7			—		—			173.7
Total compensation and benefits	586.7			—		—			586.7
General, administrative and other expenses	116.8			—		—			116.8
Interest	14.6			—		—			14.6
Interest and other expenses of Consolidated Funds	—			292.8		(55.0		)	237.8
Interest and other expenses of a consolidated real estate VIE	70.0			—		—			70.0
Other non-operating expense	1.1			—		—			1.1
Total expenses	789.2			292.8		(55.0		)	1,027.0
Other income
Net investment gains of Consolidated Funds	—			507.8		(2.3		)	505.5
Income before provision for income taxes	138.5			441.3		35.5			615.3
Provision for income taxes	10.5			—		—			10.5
Net income	128.0			441.3		35.5			604.8
Net income (loss) attributable to non-controlling interests in consolidated entities	(37.7		)	—		476.8			439.1
Net income attributable to Carlyle Holdings	165.7			441.3		(441.3		)	165.7
Net income attributable to non-controlling interests in Carlyle Holdings	126.2			—		—			126.2
Net income attributable to The Carlyle Group L.P.	$	39.5		$	441.3	$	(441.3	)	$	39.5

	Three Months Ended March 31, 2014
	Consolidated Operating Entities			Consolidated Funds		Eliminations			Consolidated
	(Dollars in millions)
Revenues
Fund management fees	$	305.7		$	—	$	(45.4	)	$	260.3
Performance fees
Realized	257.4			—		(6.0		)	251.4
Unrealized	386.6			—		(17.5		)	369.1
Total performance fees	644.0			—		(23.5		)	620.5
Investment income (loss)
Realized	2.1			—		(2.1		)	—
Unrealized	7.8			—		(1.7		)	6.1
Total investment income	9.9			—		(3.8		)	6.1
Interest and other income	4.5			—		(0.7		)	3.8
Interest and other income of Consolidated Funds	—			250.7		—			250.7
Revenue of a consolidated real estate VIE	6.0			—		—			6.0
Total revenues	970.1			250.7		(73.4		)	1,147.4
Expenses
Compensation and benefits
Base compensation	204.6			—		—			204.6
Equity-based compensation	74.2			—		—			74.2
Performance fee related
Realized	108.7			—		—			108.7
Unrealized	221.6			—		—			221.6
Total compensation and benefits	609.1			—		—			609.1
General, administrative and other expenses	134.4			—		(0.1		)	134.3
Interest	12.2			—		—			12.2
Interest and other expenses of Consolidated Funds	—			339.8		(75.8		)	264.0
Interest and other expenses of a consolidated real estate VIE	49.2			—		—			49.2
Other non-operating expense	30.2			—		—			30.2
Total expenses	835.1			339.8		(75.9		)	1,099.0
Other income
Net investment gains of Consolidated Funds	—			426.9		(2.9		)	424.0
Income before provision for income taxes	135.0			337.8		(0.4		)	472.4
Provision for income taxes	16.0			—		—			16.0
Net income	119.0			337.8		(0.4		)	456.4
Net income (loss) attributable to non-controlling interests in consolidated entities	(12.9		)	—		337.4			324.5
Net income attributable to Carlyle Holdings	131.9			337.8		(337.8		)	131.9
Net income attributable to non-controlling interests in Carlyle Holdings	107.3			—		—			107.3
Net income attributable to The Carlyle Group L.P.	$	24.6		$	337.8	$	(337.8	)	$	24.6

Supplemental statement of cash flows

	Three Months Ended March 31,
	2015			2014
	(Dollars in millions)
Cash flows from operating activities
Net income	$	128.0		$	119.0
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation and amortization	39.9			57.7
Equity-based compensation	89.9			74.2
Excess tax benefits related to equity-based compensation	(0.5		)	—
Non-cash performance fees	(278.8		)	(463.9		)
Other non-cash amounts	23.8			42.6
Investment loss (income)	27.3			(3.3		)
Purchases of investments and trading securities	(40.9		)	(69.1		)
Proceeds from the sale of investments and trading securities	283.4			411.2
Payments of contingent consideration	(3.3		)	(43.5		)
Change in deferred taxes, net	(0.3		)	1.4
Change in due from affiliates and other receivables	(7.8		)	(5.3		)
Change in receivables and inventory of a consolidated real estate VIE	(34.4		)	(0.8		)
Change in deposits and other	(6.3		)	(7.1		)
Change in other assets of a consolidated real estate VIE	15.8			11.5
Change in accounts payable, accrued expenses and other liabilities	(33.1		)	(32.3		)
Change in accrued compensation and benefits	(11.4		)	(57.3		)
Change in due to affiliates	12.0			(83.9		)
Change in other liabilities of a consolidated real estate VIE	31.9			7.3
Change in deferred revenue	106.9			133.5
Net cash provided by operating activities	342.1			91.9
Cash flows from investing activities
Change in restricted cash	18.3			84.5
Purchases of fixed assets, net	(17.4		)	(3.7		)
Acquisitions, net of cash acquired	—			(3.1		)
Net cash provided by investing activities	0.9			77.7
Cash flows from financing activities
Issuance of 5.625% senior notes due 2043, net of financing costs	—			210.8
Net payments on loans payable of a consolidated real estate VIE	(11.1		)	(9.5		)
Payments of contingent consideration	(0.5		)	(29.2		)
Excess tax benefits related to equity-based compensation	0.5			—
Distributions to common unitholders	(110.9		)	(70.4		)
Distributions to non-controlling interest holders in Carlyle Holdings	(403.6		)	(366.5		)
Contributions from non-controlling interest holders	53.7			52.2
Distributions to non-controlling interest holders	(44.7		)	(33.9		)
Net proceeds from issuance of common units, net of offering costs	—			449.5
Acquisition of non-controlling interests in Carlyle Holdings	—			(303.4		)
Change in due to/from affiliates financing activities	(5.2		)	1.6
Net cash used in financing activities	(521.8		)	(98.8		)
Effect of foreign exchange rate changes	(38.4		)	(3.1		)
(Decrease) increase in cash and cash equivalents	(217.2		)	67.7
Cash and cash equivalents, beginning of period	1,242.0			966.6
Cash and cash equivalents, end of period	$	1,024.8		$	1,034.3

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Fair Value Measurement (Tables)

3 Months Ended

Mar. 31, 2015

Fair Value Disclosures [Abstract]

Partnership's assets and liabilities measured at fair value on recurring basis

The following table summarizes the Partnership’s assets and liabilities measured at fair value on a recurring basis by the above fair value hierarchy levels as of March 31, 2015:

(Dollars in millions)	Level I		Level II		Level III		Total
Assets
Investments of Consolidated Funds:
Equity securities	$	601.1	$	105.6	$	1,393.3	$	2,100.0
Bonds	—		—		1,149.3		1,149.3
Loans	—		—		15,439.4		15,439.4
Partnership and LLC interests(1)	—		—		3,324.8		3,324.8
Hedge funds	—		3,932.3		—		3,932.3
Other	—		—		3.3		3.3
	601.1		4,037.9		21,310.1		25,949.1
Trading securities	—		—		2.2		2.2
Foreign currency forward contracts	—		14.1		—		14.1
Restricted securities of Consolidated Funds	4.1		—		12.6		16.7
Total	$	605.2	$	4,052.0	$	21,324.9	$	25,982.1
Liabilities
Loans payable of Consolidated Funds	$	—	$	—	$	16,554.6	$	16,554.6
Derivative instruments of the CLOs	—		—		27.4		27.4
Contingent consideration(2)	—		—		51.3		51.3
Loans payable of a consolidated real estate VIE	—		—		139.6		139.6
Interest rate swaps	—		2.6		—		2.6
Foreign currency forward contracts	—		8.8		—		8.8
Total	$	—	$	11.4	$	16,772.9	$	16,784.3

(1) Balance represents Fund Investments that the Partnership consolidates one fiscal quarter in arrears.

(2) Related to contingent cash and equity consideration associated with the acquisitions of Claren Road, AlpInvest, ESG, Vermillion and Metropolitan, excluding employment-based contingent consideration (see Note 9).

The following table summarizes the Partnership’s assets and liabilities measured at fair value on a recurring basis by the above fair value hierarchy levels as of December 31, 2014:

(Dollars in millions)	Level I		Level II		Level III		Total
Assets
Investments of Consolidated Funds:
Equity securities	$	346.8	$	156.8	$	1,968.5	$	2,472.1
Bonds	—		—		1,235.8		1,235.8
Loans	—		—		15,084.9		15,084.9
Partnership and LLC interests(1)	—		—		3,481.0		3,481.0
Hedge funds	—		3,753.5		—		3,753.5
Other	—		—		1.5		1.5
	346.8		3,910.3		21,771.7		26,028.8
Trading securities	—		—		3.3		3.3
Restricted securities of Consolidated Funds	4.0		—		8.6		12.6
Total	$	350.8	$	3,910.3	$	21,783.6	$	26,044.7
Liabilities
Loans payable of Consolidated Funds	$	—	$	—	$	16,052.2	$	16,052.2
Derivative instruments of the CLOs	—		—		17.2		17.2
Contingent consideration(2)	—		—		51.1		51.1
Loans payable of a consolidated real estate VIE	—		—		146.2		146.2
Interest rate swaps	—		3.2		—		3.2
Total	$	—	$	3.2	$	16,266.7	$	16,269.9

(1) Balance represents Fund Investments that the Partnership consolidates one fiscal quarter in arrears.

(2) Related to contingent cash and equity consideration associated with the acquisitions of Claren Road, AlpInvest, ESG, Vermillion and Metropolitan, excluding employment-based contingent consideration (see Note 9).

Changes in financial instruments measured at fair value

The changes in financial instruments measured at fair value for which the Partnership has used Level III inputs to determine fair value are as follows (Dollars in millions):

	Financial Assets Three Months Ended March 31, 2015
	Investments of Consolidated Funds
	Equity securities			Bonds			Loans			Partnership and LLC interests			Other			Trading securities and other			Restricted securities of Consolidated Funds		Total
Balance, beginning of period	$	1,968.5		$	1,235.8		$	15,084.9		$	3,481.0		$	1.5		$	3.3		$	8.6	$	21,783.6
Purchases	12.7			93.4			1,628.2			70.3			—			—			3.9		1,808.5
Sales	(599.6		)	(68.5		)	(343.2		)	(271.9		)	—			—			—		(1,283.2		)
Settlements	—			—			(440.9		)	—			—			—					(440.9		)
Realized and unrealized gains (losses), net
Included in earnings	188.3			11.9			32.8			191.1			2.0			(1.1		)	0.1		425.1
Included in other comprehensive income	(176.6		)	(123.3		)	(522.4		)	(145.7		)	(0.2		)	—			—		(968.2		)
Balance, end of period	$	1,393.3		$	1,149.3		$	15,439.4		$	3,324.8		$	3.3		$	2.2		$	12.6	$	21,324.9
Changes in unrealized gains (losses) included in earnings related to financial assets still held at the reporting date	$	(90.2	)	$	11.1		$	39.8		$	62.2		$	(11.8	)	$	(1.1	)	$	0.1	$	10.1

	Financial Assets Three Months Ended March 31, 2014
	Investments of Consolidated Funds
	Equity securities			Bonds			Loans			Partnership and LLC  interests			Other			Trading securities and other			Restricted securities of Consolidated Funds			Total
Balance, beginning of period	$	2,714.1		$	1,249.5		$	14,067.8		$	3,815.2		$	2.0		$	6.9		$	8.6		$	21,864.1
Transfers in (1)	4.5			—			—			—			—			—			—			4.5
Transfers out (1)	(87.5		)	—			—			—			—			—			—			(87.5		)
Purchases	14.4			99.0			1,787.0			133.8			—			—			—			2,034.2
Sales	(240.3		)	(138.8		)	(372.5		)	(450.9		)	—			(3.6		)	—			(1,206.1		)
Settlements	—			—			(1,177.8		)	—			—			—			—			(1,177.8		)
Realized and unrealized gains (losses), net
Included in earnings	62.9			14.9			23.0			153.8			(0.6		)	1.9			(0.3		)	255.6
Included in other comprehensive income	16.9			(0.7		)	(2.9		)	71.7			—			—			—			85.0
Balance, end of period	$	2,485.0		$	1,223.9		$	14,324.6		$	3,723.6		$	1.4		$	5.2		$	8.3		$	21,772.0
Changes in unrealized gains (losses) included in earnings related to financial assets still held at the reporting date	$	(88.7	)	$	13.7		$	10.0		$	(105.0	)	$	(0.6	)	$	1.9		$	(0.3	)	$	(169.0	)

(1) Transfers into and out of Level III financial assets were due to changes in the observability of market inputs used in the valuation of such assets. Transfers are measured as of the beginning of the period in which the transfer occurs.

Transfers out of Level III of financial liabilities

	Financial Liabilities Three Months Ended March 31, 2015
	Loans Payable of Consolidated Funds			Derivative Instruments of Consolidated Funds			Contingent Consideration			Loans Payable of a consolidated real estate VIE			Total
Balance, beginning of period	$	16,052.2		$	17.2		$	51.1		$	146.2		$	16,266.7
Initial consolidation of funds	664.4			—			—			—			664.4
Borrowings	939.3			—			—			7.8			947.1
Paydowns	(538.5		)	—			(0.5		)	(18.9		)	(557.9		)
Sales	—			(0.8		)	—			—			(0.8		)
Realized and unrealized (gains) losses, net
Included in earnings	55.8			9.0			0.7			13.0			78.5
Included in other comprehensive income	(618.6		)	2.0			—			(8.5		)	(625.1		)
Balance, end of period	$	16,554.6		$	27.4		$	51.3		$	139.6		$	16,772.9
Changes in unrealized (gains) losses included in earnings related to financial liabilities still held at the reporting date	$	46.4		$	(13.9	)	$	0.7		$	13.0		$	46.2

	Financial Liabilities Three Months Ended March 31, 2014
	Loans Payable of Consolidated Funds			Derivative Instruments of Consolidated Funds			Contingent Consideration			Loans Payable of a consolidated real estate VIE			Total
Balance, beginning of period	$	15,220.7		$	13.1		$	178.8		$	122.1		$	15,534.7
Initial consolidation of funds	720.4			—			—			—			720.4
Borrowings	624.6			—			—			9.6			634.2
Paydowns	(949.2		)	—			(72.7		)	(19.1		)	(1,041.0		)
Sales	—			(0.9		)	—			—			(0.9		)
Realized and unrealized losses, net
Included in earnings	69.9			2.5			19.7			10.1			102.2
Included in other comprehensive income	(7.7		)	—			—			2.6			(5.1		)
Balance, end of period	$	15,678.7		$	14.7		$	125.8		$	125.3		$	15,944.5
Changes in unrealized (gains) losses included in earnings related to financial liabilities still held at the reporting date	$	(23.3	)	$	(1.6	)	$	19.1		$	10.1		$	4.3

Summary of quantitative information about Partnership's Level III inputs

The following table summarizes quantitative information about the Partnership’s Level III inputs as of March 31, 2015:

	Fair Value at		Valuation Technique(s)	Unobservable Input(s)	Range (Weighted Average)
(Dollars in millions)	March 31, 2015
Assets
Investments of Consolidated Funds:
Equity securities	$	1,374.8	Comparable Multiple	LTM EBITDA Multiple	4.8x - 16.6x (11.7x)
	18.5		Consensus Pricing	Indicative Quotes ($ per share)	$0 - $218 ($0)
Bonds	1,149.3		Consensus Pricing	Indicative Quotes (% of Par)	1 - 147 (100)
Loans	15,221.2		Consensus Pricing	Indicative Quotes (% of Par)	0 - 139 (98)
	218.2		Market Yield Analysis	Market Yield	5% - 17% (11%)
Partnership and LLC interests	3,324.8		NAV of Underlying Fund(1)	N/A	N/A
Other	3.3		Counterparty Pricing	Indicative Quotes (% of Notional Amount)	0 - 15 (4)
	21,310.1
Trading securities and other	2.2		Comparable Multiple	LTM EBITDA Multiple	5.7x - 5.7x (5.7x)
Restricted securities of Consolidated Funds	12.6		Consensus Pricing	Indicative Quotes (% of Par)	78 - 88 (84)
Total	$	21,324.9
Liabilities
Loans payable of Consolidated Funds:
Senior secured notes	$	15,264.8	Discounted Cash Flow with Consensus Pricing	Discount Rates	1% - 11% (3%)
				Default Rates	1% - 4% (3%)
				Recovery Rates	60% - 75% (66%)
				Indicative Quotes (% of Par)	35 - 101 (98)
Subordinated notes and preferred shares	1,268.6		Discounted Cash Flow with Consensus Pricing	Discount Rates	8% - 15% (10%)
				Default Rates	1% - 4% (3%)
				Recovery Rates	60% - 75% (67%)
				Indicative Quotes (% of Par)	1 - 123 (63)
Combination notes	21.2		Consensus Pricing	Indicative Quotes (% of Par)	99 - 103 (100)
Loans payable of a consolidated real estate VIE	139.6		Discounted Cash Flow	Discount to Expected Payment	0% - 100% (32%)
				Discount Rate	23% - 33% (26%)
Derivative instruments of Consolidated Funds	27.4		Counterparty Pricing	Indicative Quotes (% of Notional Amount)	7 - 37 (21)
Contingent cash consideration(2)	51.3		Discounted Cash Flow	Assumed % of Total Potential Contingent Payments	0% - 100% (19%)
				Discount Rate	5% - 17% (13%)
Total	$	16,772.9

(1) Represents the Partnership’s investments in funds that are valued using the NAV of the underlying fund.

(2) Related to contingent cash consideration associated with the acquisitions of Claren Road, AlpInvest, ESG, Vermillion, and Metropolitan (see Note 9).

The following table summarizes quantitative information about the Partnership’s Level III inputs as of December 31, 2014:

	Fair Value at		Valuation Technique(s)	Unobservable Input(s)	Range (Weighted Average)
(Dollars in millions)	December 31, 2014
Assets
Investments of Consolidated Funds:
Equity securities	$	1,783.7	Comparable Multiple	LTM EBITDA Multiple	4.8x- 16.2x (12.1x)
	168.7		Comparable Multiple	Forward EBITDA Multiple	8.4x-8.4x (8.4x)
	16.1		Consensus Pricing	Indicative Quotes ($ per share)	$0 - $246 ($0)
Bonds	1,235.8		Consensus Pricing	Indicative Quotes (% of Par)	1 - 133 (99)
Loans	14,873.4		Consensus Pricing	Indicative Quotes (% of Par)	0 - 126 (98)
	211.5		Market Yield Analysis	Market Yield	5% - 17% (11%)
Partnership and LLC interests	3,481.0		NAV of Underlying Fund(1)	N/A	N/A
Other	1.5		Counterparty Pricing	Indicative Quotes (% of Notional Amount)	0 - 6 (3)
	21,771.7
Trading securities and other	3.0		Comparable Multiple	LTM EBITDA Multiple	5.8x - 5.8x (5.8x)
	0.3		Discounted Cash Flow	Discount Rate	10% - 10% (10%)
Restricted securities of Consolidated Funds	8.6		Consensus Pricing	Indicative Quotes (% of Par)	87 - 87 (87)
Total	$	21,783.6
Liabilities
Loans payable of Consolidated Funds:
Senior secured notes	$	14,757.5	Discounted Cash Flow with Consensus Pricing	Discount Rates	1% - 11% (3%)
				Default Rates	1% - 3% (2%)
				Recovery Rates	63% - 75% (68%)
				Indicative Quotes (% of Par)	35 - 100 (98)
Subordinated notes and preferred shares	1,278.8		Discounted Cash Flow with Consensus Pricing	Discount Rates	8% - 15% (10%)
				Default Rates	1% - 3% (2%)
				Recovery Rates	63% - 75% (68%)
				Indicative Quotes (% of Par)	1 - 132 (63)
Combination notes	15.9		Consensus Pricing	Indicative Quotes (% of Par)	97 - 98 (98)
Loans payable of a consolidated real estate VIE	146.2		Discounted Cash Flow	Discount to Expected Payment	0% - 100% (36%)
				Discount Rate	23% - 33% (26%)
Derivative instruments of Consolidated Funds	17.2		Counterparty Pricing	Indicative Quotes (% of Notional Amount)	2 - 22 (11)
Contingent cash consideration(2)	51.1		Discounted Cash Flow	Assumed % of Total Potential Contingent Payments	0% - 100% (20%)
				Discount Rate	5% - 18% (13%)
Total	$	16,266.7

(1) Represents the Partnership’s investments in funds that are valued using the NAV of the underlying fund.

(2) Related to contingent cash consideration associated with the acquisitions of Claren Road, AlpInvest, ESG, Vermillion and Metropolitan (see Note 9).

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Accrued Performance Fees (Tables)

3 Months Ended

Mar. 31, 2015

Deferred Costs [Abstract]

Components of accrued performance fees

The components of accrued performance fees are as follows:

	As of
	March 31, 2015		December 31, 2014
	(Dollars in millions)
Corporate Private Equity	$	2,857.3	$	2,932.6
Global Market Strategies	147.1		129.9
Real Assets	321.7		272.9
Investment Solutions	441.1		460.2
Total	$	3,767.2	$	3,795.6

Components of accrued giveback obligations

The components of the accrued giveback obligations are as follows:

	As of
	March 31, 2015			December 31, 2014
	(Dollars in millions)
Corporate Private Equity	$	(52.4	)	$	(52.4	)
Real Assets	(124.2		)	(52.0		)
Total	$	(176.6	)	$	(104.4	)

Performance fees included in revenues

The performance fees included in revenues are derived from the following segments:

	Three Months Ended March 31,
	2015			2014
	(Dollars in millions)
Corporate Private Equity	$	513.3		$	453.2
Global Market Strategies	18.7			66.1
Real Assets	(8.5		)	16.8
Investment Solutions	49.5			84.4
Total	$	573.0		$	620.5

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Organization and Basis of Presentation

3 Months Ended

Mar. 31, 2015

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization and Basis of Presentation

Organization and Basis of Presentation

The Carlyle Group L.P., together with its consolidated subsidiaries (the “Partnership” or “Carlyle”), is one of the world’s largest global alternative asset management firms that originates, structures and acts as lead equity investor in management-led buyouts, strategic minority equity investments, equity private placements, consolidations and buildups, growth capital financings, real estate opportunities, bank loans, high-yield debt, distressed assets, mezzanine debt and other investment opportunities. The Partnership is a Delaware limited partnership formed on July 18, 2011. The Partnership is managed and operated by its general partner, Carlyle Group Management L.L.C., which is in turn wholly-owned and controlled by Carlyle’s founders and other senior Carlyle professionals.

Carlyle provides investment management services to, and has transactions with, various private equity funds, real estate funds, business development companies, collateralized loan obligations (“CLOs”), hedge funds and other investment products sponsored by the Partnership for the investment of client assets in the normal course of business. Carlyle typically serves as the general partner, investment manager or collateral manager, making day-to-day investment decisions concerning the assets of these products. Carlyle operates its business through four reportable segments: Corporate Private Equity, Global Market Strategies, Real Assets and Investment Solutions (see Note 18).

Basis of Presentation

The accompanying financial statements include the accounts of the Partnership and its consolidated subsidiaries. In addition, certain Carlyle-affiliated funds, related co-investment entities, certain CLOs managed by the Partnership (collectively the “Consolidated Funds”) and a real estate development company (see Note 17) have been consolidated in the accompanying financial statements pursuant to accounting principles generally accepted in the United States (“U.S. GAAP”), as described in Note 2. The consolidation of the Consolidated Funds generally has a gross-up effect on assets, liabilities and cash flows, and has no effect on the net income attributable to the Partnership. The majority economic ownership interests of the investors in the Consolidated Funds are reflected as non-controlling interests in consolidated entities, partners’ capital appropriated for Consolidated Funds and redeemable non-controlling interests in consolidated entities in the accompanying condensed consolidated financial statements.

The accompanying condensed consolidated financial statements have been prepared in accordance with U.S. GAAP for interim financial information. These statements, including notes, have not been audited, exclude some of the disclosures required for annual financial statements, and should be read in conjunction with the audited consolidated financial statements included in the Partnership’s Annual Report on Form 10-K for the year ended December 31, 2014 filed with the Securities and Exchange Commission ("SEC"). The operating results presented for interim periods are not necessarily indicative of the results that may be expected for any other interim period or for the entire year. In the opinion of management, the condensed consolidated financial statements reflect all adjustments, consisting of normal recurring accruals, which are necessary for the fair presentation of the financial condition and results of operations for the interim periods presented.

March 2014 Public Offering of Partnership Common Units

On March 10, 2014, the Partnership completed a public offering of 13,800,000 common units priced at $33.50 per common unit. The Partnership received net proceeds of approximately $449.5 million, after deduction of the underwriting discount and offering expenses. The Partnership’s wholly-owned subsidiaries used $146.1 million of the net proceeds to acquire 4,500,000 newly issued Carlyle Holdings partnership units from Carlyle Holdings. These proceeds are being used by Carlyle Holdings for general corporate purposes, including investments in Carlyle’s funds as well as investment capital for acquisitions of new fund platforms and strategies or other growth initiatives, to drive innovation across the broader Carlyle platform. The Partnership’s wholly-owned subsidiaries used the remaining net proceeds of $303.4 million to acquire 9,300,000 Carlyle Holding partnership units from the other limited partners of Carlyle Holdings, including certain of the Partnership’s directors and executive officers.

As it relates to the 4,500,000 newly issued Carlyle Holdings partnership units that the Partnership acquired, because the Partnership acquired these partnership units at a valuation in excess of the proportion of the book value of the net assets acquired, the Partnership incurred an immediate dilution of approximately $116.8 million. This dilution was reflected within partners’ capital as a reallocation from partners’ capital to non-controlling interests in Carlyle Holdings.

As it relates to the 9,300,000 Carlyle Holdings partnership units that the Partnership acquired from the other limited partners of Carlyle Holdings, the Partnership accounted for this transaction as an acquisition of ownership interests in a subsidiary while retaining a controlling interest in the subsidiary. Accordingly, the carrying value of the non-controlling interest was adjusted to reflect the change in the ownership interests in Carlyle Holdings. The excess of the fair value of the consideration issued by the Partnership over the carrying amount of the non-controlling interest acquired on the transaction date was $237.0 million, which was recognized directly as a reduction to partners’ capital.

Additionally, the acquisition by the Partnership of the 9,300,000 Carlyle Holdings partnership units from the other limited partners of Carlyle Holdings is subject to the terms of the tax receivable agreement. Accordingly, the Partnership recorded a deferred tax asset of $70.0 million, an increase to the liability owed under the tax receivable agreement of $60.1 million, and an increase in partners’ capital of $9.9 million based on estimated tax information available at the time. The liability is expected to be paid as the deferred tax asset is realized as a reduction in taxes payable.

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Investments (Tables)

3 Months Ended

Mar. 31, 2015

Equity Method Investments and Joint Ventures [Abstract]

Schedule of investments

Investments consist of the following:

	As of
	March 31, 2015		December 31, 2014
	(Dollars in millions)
Equity method investments, excluding accrued performance fees	$	917.2	$	918.7
Trading securities and other investments	27.0		12.9
Total investments	$	944.2	$	931.6

Schedule of net investment earnings (loss)

The net investment earnings (loss) recognized in the Partnership’s condensed consolidated statements of operations for the three months ended March 31, 2015 and 2014 were as follows:

	Three Months Ended March 31,
	2015			2014
	(Dollars in millions)
Management fees	$	14.3		$	14.4
Performance fees	(14.5		)	—
Investment income (loss)	(0.2		)	—
Expenses and amortization of basis differences	(18.1		)	(18.7		)
Net investment income (loss)	$	(18.5	)	$	(4.3	)

Schedule of equity method investments

The Partnership’s equity method investments include its fund investments in Corporate Private Equity, Global Market Strategies and Real Assets, typically as general partner interests, and its investment in NGP Management (included within Real Assets), which are not consolidated. Investments are related to the following segments:

	As of
	March 31, 2015		December 31, 2014
	(Dollars in millions)
Corporate Private Equity	$	251.3	$	246.3
Global Market Strategies	25.3		25.3
Real Assets	640.6		647.1
Total	$	917.2	$	918.7

Components of investment income (loss)

The components of investment income (loss) are as follows:

	Three Months Ended March 31,
	2015			2014
	(Dollars in millions)
Income from equity investments	$	8.8		$	4.0
Income (loss) from trading securities	(2.6		)	1.9
Other investment income	0.6			0.2
Total	$	6.8		$	6.1

Schedule of income (loss) from equity-method investments

Carlyle’s income (loss) from its equity-method investments is included in investment income (loss) in the condensed consolidated statements of operations and consists of:

	Three Months Ended March 31,
	2015			2014
	(Dollars in millions)
Corporate Private Equity	$	23.8		$	17.0
Global Market Strategies	0.7			—
Real Assets	(15.7		)	(13.0		)
Total	$	8.8		$	4.0

Components of interest and other income of consolidated funds

The components of interest and other income of Consolidated Funds are as follows:

	Three Months Ended March 31,
	2015		2014
	(Dollars in millions)
Interest income from investments	$	208.4	$	221.2
Other income	17.9		29.5
Total	$	226.3	$	250.7

Components of net investment gains (losses) of consolidated funds

The components of net investment gains (losses) of Consolidated Funds are as follows:

	Three Months Ended March 31,
	2015			2014
	(Dollars in millions)
Gains from investments of Consolidated Funds	$	560.5		$	488.9
Losses from liabilities of CLOs	(55.5		)	(65.1		)
Gains on other assets of CLOs	0.5			0.2
Total	$	505.5		$	424.0

Schedule of realized and unrealized gains (losses) earned from investments of consolidated funds

The following table presents realized and unrealized gains (losses) earned from investments of the Consolidated Funds:

	Three Months Ended March 31,
	2015		2014
	(Dollars in millions)
Realized gains	$	224.6	$	732.3
Net change in unrealized gains (losses)	335.9		(243.4		)
Total	$	560.5	$	488.9

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Commitments and Contingencies - Additional Information (Details)	0 Months Ended	1 Months Ended		3 Months Ended		12 Months Ended	24 Months Ended						3 Months Ended
	Jul. 07, 2010 USD ($)	May 31, 2011 Lawsuits	Mar. 31, 2008 Lawsuits	Mar. 31, 2015 USD ($) Lawsuits	Mar. 31, 2014 USD ($)	Dec. 31, 2014 USD ($)	Dec. 31, 2014 EUR (€)	Mar. 31, 2015 EUR (€)	Dec. 31, 2013 EUR (€)	Apr. 15, 2015 Subsequent Event EUR (€)	Mar. 31, 2015 Contingent Obligations Giveback USD ($)	Dec. 31, 2014 Contingent Obligations Giveback USD ($)	Mar. 31, 2015 Guaranteed Loans USD ($)	Dec. 31, 2014 Guaranteed Loans USD ($)	Mar. 31, 2015 CEREP I EUR (€)
Guarantor Obligations [Line Items]
Unfunded commitment				$ 3,147,300,000
Unfunded commitment to be paid by senior Carlyle executives and professionals				2,800,000,000
Incremental borrowings under credit facility for eligible employees investing in Carlyle sponsored funds													11,300,000.0
Interest rate under credit facility for eligible employees investing in Carlyle sponsored funds													three-month LIBOR
Percentage points to be added to the interest rate under credit facility for eligible employees investing in Carlyle sponsored funds													2.00%
Weighted-average rate under credit facility (as a percent)													3.25%
Outstanding borrowing under credit facility for eligible employees investing in Carlyle sponsored funds													7,800,000	7,900,000
Potential repayment of performance fees				176,600,000		104,400,000
Unbilled receivable for giveback obligations from current and former employees											28,400,000	27,700,000
Cash withheld from carried interest distributions for potential giveback obligations				24,000,000		29,900,000					322,800,000	336,500,000
Amount of realized and distributed carried interest subject to potential giveback on after-tax basis											1,400,000,000
Expiration date of lease agreement for the Partnership's primary office space				Jul. 31, 2026
Rent expense				14,500,000	12,900,000
Deferred rent payable				43,200,000		40,400,000
Amount Of Performance Fee Reduction Due To Legal Settlement						19,300,000
Number of civil actions		2
Number of lawsuits developed from fund insolvency			6
Number of lawsuits dismissed or withdrawn from fund insolvency			4
Number of lawsuits remaining related to fund insolvency				2
Amount of claim filed by former shareholder	1,000,000,000
Total amount liable as a result of French tax court opinion				112,000,000				105,000,000	75,000,000	105,000,000
Total assets				35,013,200,000		35,994,300,000									31,000,000
Total remaining amount liable after consideration of assets in fund								74,000,000
Losses of Fund related to French tax matter				34,000,000
Cumulative losses of Fund related to French tax matter							€ 42,000,000

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Earnings Per Common Unit (Tables)

3 Months Ended

Mar. 31, 2015

Earnings Per Share [Abstract]

Summary of basic and diluted net income per common unit

Basic and diluted net income per common unit are calculated as follows:

	Three Months Ended   March 31, 2015						Three Months Ended   March 31, 2014
	Basic			Diluted			Basic			Diluted
Net income attributable to The Carlyle Group L.P.	$	39,500,000		$	39,500,000		$	24,600,000		$	24,600,000
Dilution of earnings due to participating securities with distribution rights	(427,000		)	(479,600		)	(432,600		)	(517,200		)
Net income attributable to common units	$	39,073,000		$	39,020,400		$	24,167,400		$	24,082,800
Weighted-average common units outstanding	67,684,674			72,347,771			52,501,412			59,453,670
Net income per common unit	$	0.58		$	0.54		$	0.46		$	0.41

Summary of weighted-average common units outstanding, basic and diluted

The weighted-average common units outstanding, basic and diluted, are calculated as follows:

	Three Months Ended   March 31, 2015		Three Months Ended   March 31, 2014
	Basic	Diluted	Basic	Diluted
The Carlyle Group L.P. weighted-average common units outstanding	67,684,674	67,684,674	52,501,412	52,501,412
Unvested deferred restricted common units	—	4,663,097	—	6,486,349
Contingently issuable Carlyle Holdings Partnership units	—	—	—	465,909
Weighted-average common units outstanding	67,684,674	72,347,771	52,501,412	59,453,670

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Acquisitions (Details) (Diversified Global Asset Management Corporation, USD $)	0 Months Ended
	Feb. 03, 2014
Diversified Global Asset Management Corporation
Business Acquisition [Line Items]
Date of acquisition	Feb. 03, 2014
Equity interest (as a percent)	100.00%
Fee-earning assets under management	$ 2,900,000,000
Assets under management	3,600,000,000
Cash paid for acquisitions	8,000,000
Purchase price - newly issued common units (in shares)	662,134
Approximate value of The Carlyle Group L.P. common units	23,100,000
Contingent consideration - cash	23,700,000
Contingent consideration - common units	$ 47,300,000
Contingent consideration payment year	2021

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Intangible Assets and Goodwill - Carrying Amount of Intangible Assets (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Goodwill and Intangible Assets Disclosure [Abstract]
Acquired contractual rights	$ 832.1	$ 843.0
Acquired trademarks	6.6	6.7
Accumulated amortization	(485.2)	(455.1)
Finite-lived intangible assets, net	353.5	394.6
Goodwill	45.8	47.5
Intangible assets, net	$ 399.3	$ 442.1

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Condensed Consolidated Balance Sheets (USD $) In Millions, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Assets
Cash and cash equivalents	$ 1,024.8	$ 1,242.0
Cash and cash equivalents held at Consolidated Funds	1,436.7	1,551.1
Restricted cash	41.0	59.7
Restricted cash and securities of Consolidated Funds	18.8	14.9
Accrued performance fees	3,767.2	3,795.6
Investments	944.2	931.6
Investments of Consolidated Funds	25,949.1	26,028.8
Due from affiliates and other receivables, net	202.8	199.4
Due from affiliates and other receivables of Consolidated Funds, net	688.9	1,213.2
Receivables and inventory of a consolidated real estate VIE	185.0	163.9
Fixed assets, net	86.7	75.4
Deposits and other	60.9	59.2
Other assets of a consolidated real estate VIE	73.7	86.4
Intangible assets, net	399.3	442.1
Deferred tax assets	134.1	131.0
Total assets	35,013.2	35,994.3
Liabilities and partners’ capital
Loans payable	38.4	40.2
3.875% senior notes due 2023	499.9	499.9
5.625% senior notes due 2043	606.8	606.8
Loans payable of Consolidated Funds	16,554.6	16,052.2
Loans payable of a consolidated real estate VIE at fair value (principal amount of $214.8 million and $243.6 million as of March 31, 2015 and December 31, 2014, respectively)	139.6	146.2
Accounts payable, accrued expenses and other liabilities	389.9	396.2
Accrued compensation and benefits	2,202.0	2,312.5
Due to affiliates	191.5	184.2
Deferred revenue	196.5	93.7
Deferred tax liabilities	105.0	112.2
Other liabilities of Consolidated Funds	1,708.7	2,504.9
Other liabilities of a consolidated real estate VIE	105.4	84.9
Accrued giveback obligations	176.6	104.4
Total liabilities	22,914.9	23,138.3
Commitments and contingencies
Redeemable non-controlling interests in consolidated entities	3,939.9	3,761.5
Partners’ capital (common units 68,906,237 and 67,761,012 issued and outstanding as of March 31, 2015 and December 31, 2014, respectively)	528.0	566.0
Accumulated other comprehensive loss	(50.4)	(39.0)
Partners’ capital appropriated for Consolidated Funds	126.9	184.5
Non-controlling interests in consolidated entities	5,925.7	6,446.4
Non-controlling interests in Carlyle Holdings	1,628.2	1,936.6
Total partners’ capital	8,158.4	9,094.5
Total liabilities and partners’ capital	$ 35,013.2	$ 35,994.3

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Organization and Basis of Presentation (Details) (USD $) In Millions, except Share data, unless otherwise specified	0 Months Ended	3 Months Ended
	Mar. 10, 2014	Mar. 31, 2015 Segment	Mar. 31, 2014 Segment
Partnership Organization And Basis Of Presentation [Line Items]
Number of reportable segments		4	4
Public offering of common units completed by partnership	13,800,000		13,800,000
Price per share of public offering of common units	$ 33.50
Net proceeds from the public offering	$ 449.5
Partial use of proceeds from the issuance	146.1
Number of newly issued Carlyle Holdings partnership units acquired	4,500,000
Remaining use of proceeds from the issuance	303.4
Number of Carlyle Holdings partnership units acquired from Carlyle Holdings limited partners	9,300,000		9,300,000
Approximate amount of dilution incurred by partnership			116.8
Excess fair value of consideration issued by Partnership over carrying amount of non-controlling interest acquired	237.0
Deferred tax asset	70.0
Increase (decrease) to liability owed under tax receivable agreement	(60.1)
Increase (decrease) in partners' capital based on estimated tax information	$ (9.9)
Total Partners' Capital
Partnership Organization And Basis Of Presentation [Line Items]
Number of newly issued Carlyle Holdings partnership units acquired			4,500,000

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Equity-Based Compensation - Summary of Status of Non-Vested Equity-Based Awards (Details) (USD $)	3 Months Ended
	Mar. 31, 2015
Carlyle Holdings
Units
Beginning Balance	35,997,415
Granted	0
Vested	0
Forfeited	91,174
Ending Balance	35,906,241
Weighted- Average Grant Date Fair Value (in dollars per share)
Beginning Balance	$ 22.16
Granted	$ 0.00
Vested	$ 0.00
Forfeited	$ 22.00
Ending Balance	$ 22.16
Equity Settled Awards | Deferred Restricted Common Units | The Carlyle Group, L.P.
Units
Beginning Balance	18,929,270
Granted	4,981,436
Vested	931,965
Forfeited	512,748
Ending Balance	22,465,993
Weighted- Average Grant Date Fair Value (in dollars per share)
Beginning Balance	$ 26.12
Granted	$ 23.83
Vested	$ 28.90
Forfeited	$ 24.01
Ending Balance	$ 25.51
Equity Settled Awards | Unvested Common Units | The Carlyle Group, L.P.
Units
Beginning Balance	809,797
Granted	0
Vested	31,132
Forfeited	0
Ending Balance	778,665
Weighted- Average Grant Date Fair Value (in dollars per share)
Beginning Balance	$ 27.19
Granted	$ 0.00
Vested	$ 21.53
Forfeited	$ 0.00
Ending Balance	$ 27.42
Cash Settled Awards | Phantom Units | The Carlyle Group, L.P.
Units
Beginning Balance	104,070
Granted	0
Vested	3,408
Forfeited	2,950
Ending Balance	97,712
Weighted- Average Grant Date Fair Value (in dollars per share)
Beginning Balance	$ 23.40
Granted	$ 0.00
Vested	$ 34.81
Forfeited	$ 23.41
Ending Balance	$ 23.00

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Condensed Consolidated Statements of Cash Flows (Unaudited) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Cash flows from operating activities
Net income	$ 604.8	$ 456.4
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation and amortization	39.9	57.7
Equity-based compensation	89.9	74.2
Excess tax benefits related to equity-based compensation	(0.5)	0
Non-cash performance fees	(275.7)	(446.3)
Other non-cash amounts	23.8	42.6
Consolidated Funds related:
Realized/unrealized gain on investments of Consolidated Funds	(576.4)	(474.1)
Realized/unrealized loss from loans payable of Consolidated Funds	48.8	66.5
Purchases of investments by Consolidated Funds	(2,139.0)	(2,418.6)
Proceeds from sale and settlements of investments by Consolidated Funds	1,992.4	2,801.2
Non-cash interest income, net	(4.0)	(8.9)
Change in cash and cash equivalents held at Consolidated Funds	778.1	(31.7)
Change in other receivables held at Consolidated Funds	367.2	310.4
Change in other liabilities held at Consolidated Funds	208.1	265.0
Investment income	(3.7)	(6.9)
Purchases of investments and trading securities	(20.1)	(12.0)
Proceeds from the sale of investments and trading securities	271.4	390.8
Payments of contingent consideration	(3.3)	(43.5)
Changes in deferred taxes, net	(0.3)	1.4
Change in due from affiliates and other receivables	(7.8)	(5.3)
Change in receivables and inventory of a consolidated real estate VIE	(34.4)	(0.8)
Change in deposits and other	(6.3)	(7.1)
Change in other assets of a consolidated real estate VIE	15.8	11.5
Change in accounts payable, accrued expenses and other liabilities	(33.1)	(32.3)
Change in accrued compensation and benefits	(11.4)	(57.3)
Change in due to affiliates	12.0	(83.9)
Change in other liabilities of a consolidated real estate VIE	31.9	7.3
Change in deferred revenue	106.9	133.5
Net cash provided by operating activities	1,475.0	989.8
Cash flows from investing activities
Change in restricted cash	18.3	84.5
Purchases of fixed assets, net	(17.4)	(3.7)
Acquisitions, net of cash acquired	0	(3.1)
Net cash provided by investing activities	0.9	77.7
Cash flows from financing activities
Issuance of 5.625% senior notes due 2043, net of financing costs	0	210.8
Net payments on loans payable of a consolidated real estate VIE	(11.1)	(9.5)
Net borrowings (payments) on loans payable of Consolidated Funds	402.2	(323.2)
Payments of contingent consideration	(0.5)	(29.2)
Excess tax benefits related to equity-based compensation	0.5	0
Distributions to common unitholders	(110.9)	(70.4)
Distributions to non-controlling interest holders in Carlyle Holdings	(403.6)	(366.5)
Net proceeds from issuance of common units, net of offering costs	0	449.5
Acquisition of non-controlling interests in Carlyle Holdings	0	(303.4)
Contributions from non-controlling interest holders	752.2	753.3
Distributions to non-controlling interest holders	(1,268.4)	(1,256.9)
Change in due to/from affiliates financing activities	(5.2)	1.6
Change in due to/from affiliates and other receivables of Consolidated Funds	(962.2)	(53.9)
Net cash used in financing activities	(1,607.0)	(997.8)
Effect of foreign exchange rate changes	(86.1)	(2.0)
(Decrease) increase in cash and cash equivalents	(217.2)	67.7
Cash and cash equivalents, beginning of period	1,242.0	966.6
Cash and cash equivalents, end of period	1,024.8	1,034.3
Supplemental non-cash disclosures
Net increase in partners’ capital and accumulated other comprehensive income related to reallocation of ownership interest in Carlyle Holdings	9.2	32.9
Initial consolidation of Consolidated Funds	36.0	0
Tax effect from acquisition of Carlyle Holdings partnership units:
Deferred tax asset	0	70.0
Tax receivable agreement liability	0	60.1
Total partners’ capital	$ 0	$ 9.9

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Earnings Per Common Unit - Additional Information (Details)	3 Months Ended		0 Months Ended
	Mar. 31, 2015	Mar. 31, 2014	Aug. 01, 2013
Dilutive Securities Included And Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Weighted-average common units outstanding, Diluted	72,347,771	59,453,670
Weighted-average vested Carlyle Holdings partnership units
Dilutive Securities Included And Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Carlyle Holdings partnership units deemed antidilutive	227,127,601
Weighted-average unvested Carlyle Holdings partnership units
Dilutive Securities Included And Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Carlyle Holdings partnership units deemed antidilutive		234,789,709
AlpInvest
Dilutive Securities Included And Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Additional ownership percentage acquired			40.00%
Common units issued to AlpInvest employees that are subject to vesting conditions			914,087
AlpInvest | Weighted-average unvested Carlyle Holdings partnership units
Dilutive Securities Included And Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Weighted-average common units outstanding, Diluted	778,665

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Accrued Performance Fees - Components of Accrued Performance Fees (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Accrued Performance Fees Disclosure [Line Items]
Accrued performance fees	$ 3,767.2	$ 3,795.6
Corporate Private Equity
Accrued Performance Fees Disclosure [Line Items]
Accrued performance fees	2,857.3	2,932.6
Global Market Strategies
Accrued Performance Fees Disclosure [Line Items]
Accrued performance fees	147.1	129.9
Real Assets
Accrued Performance Fees Disclosure [Line Items]
Accrued performance fees	321.7	272.9
Investment Solutions
Accrued Performance Fees Disclosure [Line Items]
Accrued performance fees	$ 441.1	$ 460.2

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Consolidation of a Real Estate Development Company - Revenues and Expenses Recognized in the Partnership's Condensed Consolidated Statements of Operations (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Revenue of a consolidated real estate VIE
Land development services	$ 54.8	$ 4.6
Investment income	0.4	1.4
Revenue of a consolidated real estate VIE	55.2	6.0
Interest and other expenses of a consolidated real estate VIE:
Costs of products sold and services rendered	41.0	13.7
Interest expense	10.2	11.2
Change in fair value of loans payable	5.8	10.2
Compensation and benefits	2.6	2.4
G&A and other expenses	10.4	11.7
Interest and other expenses of a consolidated real estate VIE	$ 70.0	$ 49.2

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Contingent Consideration (Tables)

3 Months Ended

Mar. 31, 2015

Business Combinations [Abstract]

Changes in contingent consideration liabilities

The changes in the contingent consideration liabilities are as follows:

	Rollforward For The Three Months Ended March 31, 2015
	Amounts payable to the sellers who are Carlyle professionals
	Performance-based contingent cash consideration			Performance-based contingent equity consideration		Employment-based contingent consideration			Contingent cash and other consideration payable to non- Carlyle personnel				Total
	(Dollars in millions)
Balance at December 31, 2014	$	26.8		$	—	$	156.8		$	201.0			$	384.6
Change in carrying value	0.7			—		(9.5		)	25.6			(a)	16.8
Payments	—			—		(3.3		)	(0.5		)		(3.8		)
Issuances of equity	—			—		(2.2		)	—				(2.2		)
Balance at March 31, 2015	$	27.5		$	—	$	141.8		$	226.1			$	395.4
	Rollforward For The Three Months Ended March 31, 2014
	Amounts payable to the sellers who are senior Carlyle professionals												Total
	Performance-based contingent cash consideration			Performance-based contingent equity consideration		Employment-based contingent consideration			Contingent cash and other consideration payable to non- Carlyle personnel
	(Dollars in millions)
Balance at December 31, 2013	$	145.1		$	15.7	$	148.7		$	40.8			$	350.3
Change in carrying value	17.0			10.6		13.1			5.2				45.9
Payments	(70.5		)	—		—			(2.2		)		(72.7		)
Balance at March 31, 2014	$	91.6		$	26.3	$	161.8		$	43.8			$	323.5

(a) - Refer to Note 6 for information on the contingent consideration payable to BNRI from the strategic investment in NGP.

Maximum amount that could be paid from contingent cash obligations

The following table represents the maximum amounts that could be paid from contingent cash obligations associated with the business acquisitions and the strategic investment in NGP Management: 

	As of March 31, 2015
	Business Acquisitions		NGP Investment		Total		Liability Recognized on Financial Statements (1)
			(Dollars in millions)
Performance-based contingent cash consideration	$	231.8	$	183.0	$	414.8	$	253.6
Employment-based contingent cash consideration	255.0		45.0		300.0		141.8
Total maximum cash obligations	$	486.8	$	228.0	$	714.8	$	395.4

(1) On the condensed consolidated balance sheet, the liability for performance-based contingent cash consideration is included in due to affiliates (for amounts owed to Carlyle professionals and NGP) and accounts payable, accrued expenses, and other liabilities (for amounts owed to other sellers), and the liability for employment-based contingent cash consideration is included in accrued compensation and benefits.

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Investments - Schedule of Net Investment Earnings (Loss) (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Equity Method Investments and Joint Ventures [Abstract]
Management fees	$ 14.3	$ 14.4
Performance fees	(14.5)	0
Investment income (loss)	(0.2)	0
Expenses and amortization of basis differences	(18.1)	(18.7)
Net investment income (loss)	$ (18.5)	$ (4.3)

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Earnings Per Common Unit

3 Months Ended

Mar. 31, 2015

Earnings Per Share [Abstract]

Earnings Per Common Unit

Earnings Per Common Unit

Basic and diluted net income per common unit are calculated as follows:

	Three Months Ended   March 31, 2015						Three Months Ended   March 31, 2014
	Basic			Diluted			Basic			Diluted
Net income attributable to The Carlyle Group L.P.	$	39,500,000		$	39,500,000		$	24,600,000		$	24,600,000
Dilution of earnings due to participating securities with distribution rights	(427,000		)	(479,600		)	(432,600		)	(517,200		)
Net income attributable to common units	$	39,073,000		$	39,020,400		$	24,167,400		$	24,082,800
Weighted-average common units outstanding	67,684,674			72,347,771			52,501,412			59,453,670
Net income per common unit	$	0.58		$	0.54		$	0.46		$	0.41

The weighted-average common units outstanding, basic and diluted, are calculated as follows:

	Three Months Ended   March 31, 2015		Three Months Ended   March 31, 2014
	Basic	Diluted	Basic	Diluted
The Carlyle Group L.P. weighted-average common units outstanding	67,684,674	67,684,674	52,501,412	52,501,412
Unvested deferred restricted common units	—	4,663,097	—	6,486,349
Contingently issuable Carlyle Holdings Partnership units	—	—	—	465,909
Weighted-average common units outstanding	67,684,674	72,347,771	52,501,412	59,453,670

The weighted-average common units outstanding of The Carlyle Group L.P. includes vested deferred restricted common units and other common units associated with acquisitions that have been earned for which issuance of the related common units is deferred until future periods.

The Partnership applies the treasury stock method to determine the dilutive weighted-average common units represented by the unvested deferred restricted common units. Also included in the determination of dilutive weighted-average common units are contingently issuable Carlyle Holdings partnership units and common units associated with the Claren Road, Vermillion, Metropolitan, and DGAM acquisitions. For purposes of determining the dilutive weighted-average common units, it is assumed that March 31, 2015 and 2014 represent the end of the contingency period, the “if-converted” method is applied to any Carlyle Holdings partnership units issuable therefrom, and the treasury stock method is applied.

The Partnership applies the “if-converted” method to the vested Carlyle Holdings partnership units to determine the dilutive weighted-average common units outstanding. The Partnership applies the treasury stock method to the unvested Carlyle Holdings partnership units and the “if-converted” method on the resulting number of additional Carlyle Holdings partnership units to determine the dilutive weighted-average common units represented by the unvested Carlyle Holdings partnership units.

In computing the dilutive effect that the exchange of Carlyle Holdings partnership units would have on earnings per common unit, the Partnership considered that net income available to holders of common units would increase due to the elimination of non-controlling interests in Carlyle Holdings (including any tax impact). Based on these calculations, the incremental 227,127,601 and 234,789,709 of vested and unvested Carlyle Holdings partnership units for the three months ended March 31, 2015 and 2014, respectively, were antidilutive, and therefore have been excluded.

On August 1, 2013, as part of acquiring the remaining 40% equity interests in AlpInvest, the Partnership issued 914,087 common units that are subject to vesting conditions. As of March 31, 2015, 778,665 common units remain unvested. The common units participate immediately in any Partnership distributions. Under ASC 260, these common units are considered participating securities and are required to be included in the computation of earnings per common unit pursuant to the two-class method.

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Accrued Compensation and Benefits (Tables)

3 Months Ended

Mar. 31, 2015

Compensation and Retirement Disclosure [Abstract]

Summary of accrued compensation and benefits

Accrued compensation and benefits consist of the following:

	As of
	March 31, 2015		December 31, 2014
	(Dollars in millions)
Accrued performance fee-related compensation	$	1,808.4	$	1,815.4
Accrued bonuses	127.7		229.6
Employment-based contingent cash consideration	141.8		156.8
Other	124.1		110.7
Total	$	2,202.0	$	2,312.5

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Consolidation of a Real Estate Development Company - Assets and Liabilities Recognized in the Partnership's Condensed Consolidated Balance Sheets (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Receivables and inventory of a consolidated real estate VIE:
Receivables and inventory of a consolidated real estate VIE	$ 185.0	$ 163.9
Other assets of a consolidated real estate VIE:
Other assets of a consolidated real estate VIE	73.7	86.4
Other liabilities of a consolidated real estate VIE:
Principal amount	214.8	243.6
Partnership
Receivables and inventory of a consolidated real estate VIE:
Customer and other receivables	106.4	91.5
Inventory costs in excess of billings and advances	78.6	72.4
Receivables and inventory of a consolidated real estate VIE	185.0	163.9
Other assets of a consolidated real estate VIE:
Restricted investments	34.1	36.8
Fixed assets, net	1.4	1.8
Deferred tax assets	10.0	12.9
Other assets	28.2	34.9
Other assets of a consolidated real estate VIE	73.7	86.4
Loans payable of a consolidated real estate VIE, at fair value (principal amount of $214.8 million and $243.6 million as of March 31, 2015 and December 31, 2014, respectively)	139.6	146.2
Other liabilities of a consolidated real estate VIE:
Accounts payable	23.2	26.1
Other liabilities	82.2	58.8
Other liabilities of a consolidated real estate VIE	105.4	84.9
Partnership | Loans Payable of a consolidated real estate VIE
Other liabilities of a consolidated real estate VIE:
Principal amount	$ 214.8	$ 243.6

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Consolidation of a Real Estate Development Company

3 Months Ended

Mar. 31, 2015

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Consolidation of a Real Estate Development Company

Consolidation of a Real Estate Development Company

The Partnership, indirectly through certain Carlyle real estate investment funds, has an investment in Urbplan Desenvolvimento Urbano S.A. (“Urbplan”), a Brazilian residential subdivision and land development company.

In late 2012, it was determined that Urbplan was facing serious liquidity problems and would require additional capital infusions to continue operations. The Partnership and certain of its senior Carlyle professionals provided capital to Urbplan through one of the Carlyle investment funds starting in 2013. The Partnership concluded that Urbplan was a VIE as of September 30, 2013 because Urbplan’s equity investment at risk was not sufficient to permit it to finance its activities without additional financial support. The Partnership also concluded that it was the primary beneficiary of Urbplan since the Partnership has the power to direct the activities of Urbplan that most significantly impact its economic performance and the Partnership’s investments in Urbplan will absorb losses incurred by Urbplan. As such, the Partnership began consolidating Urbplan into its consolidated financial statements as of September 30, 2013. Due to the timing and availability of financial information from Urbplan, the Partnership consolidates the financial position and results of operations of Urbplan on a financial reporting lag of 90 days. The Partnership will disclose the effect of intervening events at Urbplan that materially affect the financial position or results of operations of the Partnership, if any.

The assets and liabilities of Urbplan are held in legal entities separate from the Partnership; the Partnership has not guaranteed or assumed any obligation for repayment of Urbplan’s liabilities nor are the assets of Urbplan available to meet the liquidity requirements of the Partnership. However, if Urbplan fails to complete its construction projects, customers, partners, government agencies or municipalities or other creditors in certain circumstances might seek to assert claims against the Partnership and its assets unrelated to Urbplan under certain consumer protection or other laws.

Urbplan is currently a party to various litigation, government investigations and proceedings, disputes and other potential claims. The Partnership does not believe it is probable that the outcome of any existing Urbplan litigation, disputes or other potential claims will materially affect the Partnership or these consolidated financial statements.

From 2013 through March 31, 2015, $227.4 million has been funded to Urbplan by the Partnership and its senior Carlyle professionals (net of gains from related foreign currency forward contracts). The Partnership has funded $54.3 million of the $227.4 million and the remaining $173.1 million has been funded by senior Carlyle professionals indirectly through the Partnership. For the three months ended March 31, 2015, $14.1 million was funded to Urbplan, of which the Partnership funded $3.5 million and the senior Carlyle professionals funded $10.6 million indirectly through the Partnership.

At this time, Urbplan is estimated to require approximately $90 million of additional capital over the next twelve months to complete its expected business turnaround. While no contractual or other obligations exist to provide additional financial support to Urbplan, the Partnership and its senior Carlyle professionals expect to provide additional capital funding to Urbplan in the future and Urbplan will continue to seek capital funding from unaffiliated parties. The Partnership and its senior Carlyle professionals will evaluate the possibility of further capital infusions based on the circumstances at the time (including levels of third-party funding participation). It is anticipated that the Partnership would fund 25% and its senior Carlyle professionals would fund 75% indirectly through the Partnership of any additional investments made by the Partnership and its senior Carlyle professionals.

The assets and liabilities recognized in the Partnership’s condensed consolidated balance sheets as of March 31, 2015 and December 31, 2014 related to Urbplan were as follows:

	As of
	March 31, 2015		December 31, 2014
	(Dollars in millions)
Receivables and inventory of a consolidated real estate VIE:
Customer and other receivables	$	106.4	$	91.5
Inventory costs in excess of billings and advances	78.6		72.4
	$	185.0	$	163.9
Other assets of a consolidated real estate VIE:
Restricted investments	$	34.1	$	36.8
Fixed assets, net	1.4		1.8
Deferred tax assets	10.0		12.9
Other assets	28.2		34.9
	$	73.7	$	86.4
Loans payable of a consolidated real estate VIE, at fair value (principal amount of $214.8 million and $243.6 million as of March 31, 2015 and December 31, 2014, respectively)	$	139.6	$	146.2
Other liabilities of a consolidated real estate VIE:
Accounts payable	$	23.2	$	26.1
Other liabilities	82.2		58.8
	$	105.4	$	84.9

The revenues and expenses recognized in the Partnership’s condensed consolidated statements of operations for the three months ended March 31, 2015 and 2014, respectively, related to Urbplan were as follows:

	Three Months Ended March 31, 2015		Three Months Ended March 31, 2014
	(Dollars in millions)
Revenue of a consolidated real estate VIE
Land development services	$	54.8	$	4.6
Investment income	0.4		1.4
	$	55.2	$	6.0
Interest and other expenses of a consolidated real estate VIE:
Costs of products sold and services rendered	$	41.0	$	13.7
Interest expense	10.2		11.2
Change in fair value of loans payable	5.8		10.2
Compensation and benefits	2.6		2.4
G&A and other expenses	10.4		11.7
	$	70.0	$	49.2

The following is a summary of the significant classifications of assets and liabilities of Urbplan:

Customer and other receivables – This balance consists primarily of amounts owed for land development services using the completed contract method. Customer receivables accrue interest at rates ranging from 9% to 12% per year and are secured by the underlying real estate. Substantially all receivables are pledged as collateral for Urbplan’s borrowings. The carrying value of the receivables includes an appropriate allowance for estimated uncollectible accounts to reflect any loss anticipated on the balances. Urbplan calculates this allowance based on its history of write-offs, the level of past-due accounts based on the contractual terms of the receivables, and its relationships with, and the economic status of, Urbplan’s customers.

Inventory costs in excess of billings and advances – This balance consists primarily of capitalized land development cost, net of approximately $148.1 million and $190.4 million of customer advances received as of March 31, 2015 and December 31, 2014, respectively. Urbplan records valuation adjustments on inventory when events and circumstances indicate that the inventory may be impaired and when the cash flows estimated to be generated by the real estate project are less than its carrying amount. Real estate projects that demonstrate potential impairment indicators are tested for impairment by Urbplan by comparing the expected undiscounted cash flows for the real estate project to its carrying value. For those real estate projects whose carrying values exceed the expected undiscounted cash flows, Urbplan estimates the fair value of the real estate projects. Impairment charges are recorded if the fair value of the inventory is less than its carrying value. The estimates used in the determination of the estimated fair value of the real estate projects were based on factors known to Urbplan at the time such estimates were made and the expectations of future operations and economic conditions. Should the estimates or expectations used in determining estimated fair value deteriorate in the future, Urbplan may be required to recognize additional impairment charges and write-offs related to real estate projects.

Loans payable of a consolidated real estate VIE – This balance consists of Urbplan’s borrowings for its real estate development activities. The estimated fair value approximates 65% of the outstanding principal amounts of the loans. The fair value of the loans was based on discounted cash flow analyses which considered the liquidity and current financial condition of Urbplan and applicable discount rates. The Partnership has elected to re-measure the loans at fair value at each reporting period through the term of the loans. The principal amounts of the loans accrue interest at a variable rate based on an index plus an applicable margin. Interest rates are based on: (i) CDI plus a margin ranging from 4.0% to 7.4% (16.6% to 20.0% as of March 31, 2015); (ii) IGP-M plus a margin of 12.0% (15.1% as of March 31, 2015); or (iii) IPCA plus a margin ranging from 10.0% to 13.5% (18.1% to 21.6% as of March 31, 2015). Outstanding principal amounts on the loans based on current contractual terms are payable as follows (Dollars in millions):

2015	$	27.6
2016	24.3
2017	19.1
2018	16.5
2019	19.1
Thereafter	108.2
	$	214.8

Substantially all of Urbplan’s customer and other receivables and investments have been pledged as collateral for the loans. As of March 31, 2015, substantially all of Urbplan’s loans payable are not in compliance with their related debt covenants or are otherwise in technical default. These violations do not cause a default or event of default under the Partnership’s senior credit facility or senior notes. Urbplan management is in discussions with the lenders to cure or re-negotiate the loans in default. Currently there are no outstanding notices of acceleration of payment on the loans in default.

All of the loans payable of Urbplan are contractually non-recourse to the Partnership.

Other liabilities – This balance consists of amounts owed to landowners, commissions payable to brokers, real estate taxes, social charges and other liabilities.

Revenue of a consolidated real estate VIE – This balance consists primarily of amounts earned for land development services using the completed contract method and investment income earned on Urbplan’s investments. Under the completed contract method of accounting, revenue is not recorded until the period in which the land development services contract is completed.

Interest and other expenses of a consolidated real estate VIE – This balance consists primarily of interest expense on Urbplan’s borrowings, general and administrative expenses, compensation and benefits, and costs associated with land development services. Also included in this caption is the change in the Partnership’s estimate of the fair value of Urbplan’s loans payable during the period. Interest expense is recorded on Urbplan’s borrowings at variable rates as defined. Costs related to Urbplan’s land development services activities are capitalized until the services are complete. Costs associated with advertising, marketing and other selling activities are expensed when incurred.

Impairment – Urbplan evaluates its assets for impairment whenever events or changes in circumstances indicate that the carrying amount of such asset may not be recoverable, but not less than annually.

As of March 31, 2015, Urbplan had outstanding commitments for land development services with an estimated $85.6 million of future costs to be incurred.

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Investments - Schedule of Income (Loss) from Equity-Method Investments (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Schedule of Investments [Line Items]
Income (loss) from equity-method investments	$ 8.8	$ 4.0
Corporate Private Equity
Schedule of Investments [Line Items]
Income (loss) from equity-method investments	23.8	17.0
Global Market Strategies
Schedule of Investments [Line Items]
Income (loss) from equity-method investments	0.7	0
Real Assets
Schedule of Investments [Line Items]
Income (loss) from equity-method investments	$ (15.7)	$ (13.0)

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Supplemental Financial Information - Supplemental Financial Position (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014	Mar. 31, 2014	Dec. 31, 2013
Assets
Cash and cash equivalents	$ 1,024.8	$ 1,242.0	$ 1,034.3	$ 966.6
Cash and cash equivalents held at Consolidated Funds	1,436.7	1,551.1
Restricted cash	41.0	59.7
Restricted cash and securities of Consolidated Funds	18.8	14.9
Accrued performance fees	3,767.2	3,795.6
Investments	944.2	931.6
Investments of Consolidated Funds	25,949.1	26,028.8
Due from affiliates and other receivables, net	202.8	199.4
Due from affiliates and other receivables of Consolidated Funds, net	688.9	1,213.2
Receivables and inventory of a consolidated real estate VIE	185.0	163.9
Fixed assets, net	86.7	75.4
Deposits and other	60.9	59.2
Other assets of a consolidated real estate VIE	73.7	86.4
Intangible assets, net	399.3	442.1
Deferred tax assets	134.1	131.0
Total assets	35,013.2	35,994.3
Liabilities and partners’ capital
Loans payable	38.4	40.2
3.875% senior notes due 2023	499.9	499.9
5.625% senior notes due 2043	606.8	606.8
Loans payable of Consolidated Funds	16,554.6	16,052.2
Loans payable of a consolidated real estate VIE	139.6	146.2
Accounts payable, accrued expenses and other liabilities	389.9	396.2
Accrued compensation and benefits	2,202.0	2,312.5
Due to affiliates	191.5	184.2
Deferred revenue	196.5	93.7
Deferred tax liabilities	105.0	112.2
Other liabilities of Consolidated Funds	1,708.7	2,504.9
Other liabilities of a consolidated real estate VIE	105.4	84.9
Accrued giveback obligations	176.6	104.4
Total liabilities	22,914.9	23,138.3
Redeemable non-controlling interests in consolidated entities	3,939.9	3,761.5
Partners’ capital	528.0	566.0
Accumulated other comprehensive income (loss)	(50.4)	(39.0)
Partners’ capital appropriated for Consolidated Funds	126.9	184.5
Non-controlling interests in consolidated entities	5,925.7	6,446.4
Non-controlling interests in Carlyle Holdings	1,628.2	1,936.6
Total partners’ capital	8,158.4	9,094.5
Total liabilities and partners’ capital	35,013.2	35,994.3
Consolidated Operating Entities
Assets
Cash and cash equivalents	1,024.8	1,242.0
Cash and cash equivalents held at Consolidated Funds	0	0
Restricted cash	41.0	59.7
Restricted cash and securities of Consolidated Funds	0	0
Accrued performance fees	3,780.1	3,808.9
Investments	1,119.3	1,114.9
Investments of Consolidated Funds	0	0
Due from affiliates and other receivables, net	218.3	215.8
Due from affiliates and other receivables of Consolidated Funds, net	0	0
Receivables and inventory of a consolidated real estate VIE	185.0	163.9
Fixed assets, net	86.7	75.4
Deposits and other	57.7	57.3
Other assets of a consolidated real estate VIE	73.7	86.4
Intangible assets, net	399.3	442.1
Deferred tax assets	134.1	131.0
Total assets	7,120.0	7,397.4
Liabilities and partners’ capital
Loans payable	38.4	40.2
3.875% senior notes due 2023	499.9	499.9
5.625% senior notes due 2043	606.8	606.8
Loans payable of Consolidated Funds	0	0
Loans payable of a consolidated real estate VIE	139.6	146.2
Accounts payable, accrued expenses and other liabilities	469.1	446.8
Accrued compensation and benefits	2,202.0	2,312.5
Due to affiliates	191.3	183.6
Deferred revenue	196.7	93.9
Deferred tax liabilities	105.0	112.2
Other liabilities of Consolidated Funds	0	0
Other liabilities of a consolidated real estate VIE	105.4	84.9
Accrued giveback obligations	184.5	113.4
Total liabilities	4,738.7	4,640.4
Redeemable non-controlling interests in consolidated entities	8.0	8.4
Partners’ capital	528.0	566.0
Accumulated other comprehensive income (loss)	(52.8)	(40.3)
Partners’ capital appropriated for Consolidated Funds	0	0
Non-controlling interests in consolidated entities	269.9	286.3
Non-controlling interests in Carlyle Holdings	1,628.2	1,936.6
Total partners’ capital	2,373.3	2,748.6
Total liabilities and partners’ capital	7,120.0	7,397.4
Consolidated Funds
Assets
Cash and cash equivalents	0	0
Cash and cash equivalents held at Consolidated Funds	1,436.7	1,551.1
Restricted cash	0	0
Restricted cash and securities of Consolidated Funds	18.8	14.9
Accrued performance fees	0	0
Investments	0	0
Investments of Consolidated Funds	25,949.0	26,028.7
Due from affiliates and other receivables, net	0	0
Due from affiliates and other receivables of Consolidated Funds, net	688.9	1,213.2
Receivables and inventory of a consolidated real estate VIE	0	0
Fixed assets, net	0	0
Deposits and other	3.2	1.9
Other assets of a consolidated real estate VIE	0	0
Intangible assets, net	0	0
Deferred tax assets	0	0
Total assets	28,096.6	28,809.8
Liabilities and partners’ capital
Loans payable	0	0
3.875% senior notes due 2023	0	0
5.625% senior notes due 2043	0	0
Loans payable of Consolidated Funds	16,721.9	16,219.8
Loans payable of a consolidated real estate VIE	0	0
Accounts payable, accrued expenses and other liabilities	0	0
Accrued compensation and benefits	0	0
Due to affiliates	0.2	1.0
Deferred revenue	0	0
Deferred tax liabilities	0	0
Other liabilities of Consolidated Funds	1,751.3	2,548.0
Other liabilities of a consolidated real estate VIE	0	0
Accrued giveback obligations	0	0
Total liabilities	18,473.4	18,768.8
Redeemable non-controlling interests in consolidated entities	3,931.9	3,753.1
Partners’ capital	(111.5)	(71.5)
Accumulated other comprehensive income (loss)	12.4	6.3
Partners’ capital appropriated for Consolidated Funds	134.6	193.0
Non-controlling interests in consolidated entities	5,655.8	6,160.1
Non-controlling interests in Carlyle Holdings	0	0
Total partners’ capital	5,691.3	6,287.9
Total liabilities and partners’ capital	28,096.6	28,809.8
Eliminations
Assets
Cash and cash equivalents	0	0
Cash and cash equivalents held at Consolidated Funds	0	0
Restricted cash	0	0
Restricted cash and securities of Consolidated Funds	0	0
Accrued performance fees	(12.9)	(13.3)
Investments	(175.1)	(183.3)
Investments of Consolidated Funds	0.1	0.1
Due from affiliates and other receivables, net	(15.5)	(16.4)
Due from affiliates and other receivables of Consolidated Funds, net	0	0
Receivables and inventory of a consolidated real estate VIE	0	0
Fixed assets, net	0	0
Deposits and other	0	0
Other assets of a consolidated real estate VIE	0	0
Intangible assets, net	0	0
Deferred tax assets	0	0
Total assets	(203.4)	(212.9)
Liabilities and partners’ capital
Loans payable	0	0
3.875% senior notes due 2023	0	0
5.625% senior notes due 2043	0	0
Loans payable of Consolidated Funds	(167.3)	(167.6)
Loans payable of a consolidated real estate VIE	0	0
Accounts payable, accrued expenses and other liabilities	(79.2)	(50.6)
Accrued compensation and benefits	0	0
Due to affiliates	0	(0.4)
Deferred revenue	(0.2)	(0.2)
Deferred tax liabilities	0	0
Other liabilities of Consolidated Funds	(42.6)	(43.1)
Other liabilities of a consolidated real estate VIE	0	0
Accrued giveback obligations	(7.9)	(9.0)
Total liabilities	(297.2)	(270.9)
Redeemable non-controlling interests in consolidated entities	0	0
Partners’ capital	111.5	71.5
Accumulated other comprehensive income (loss)	(10.0)	(5.0)
Partners’ capital appropriated for Consolidated Funds	(7.7)	(8.5)
Non-controlling interests in consolidated entities	0	0
Non-controlling interests in Carlyle Holdings	0	0
Total partners’ capital	93.8	58.0
Total liabilities and partners’ capital	$ (203.4)	$ (212.9)

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Condensed Consolidated Statements of Cash Flows (Unaudited) (Parenthetical) (5.625% Senior Notes Due 3/30/2043)	Mar. 31, 2015	Dec. 31, 2014
5.625% Senior Notes Due 3/30/2043
Senior notes percentage	5.625%	5.625%

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Condensed Consolidated Balance Sheets (Parenthetical) (USD $) In Millions, except Share data, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Principal amount	$ 214.8	$ 243.6
Common stock, units issued	68,906,237	67,761,012
Common stock, units outstanding	68,906,237	67,761,012
3.875% Senior Notes Due 2/01/2023
Senior notes percentage	3.875%	3.875%
5.625% Senior Notes Due 3/30/2043
Senior notes percentage	5.625%	5.625%

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Accrued Compensation and Benefits

3 Months Ended

Mar. 31, 2015

Compensation and Retirement Disclosure [Abstract]

Accrued Compensation and Benefits

Accrued Compensation and Benefits

Accrued compensation and benefits consist of the following:

	As of
	March 31, 2015		December 31, 2014
	(Dollars in millions)
Accrued performance fee-related compensation	$	1,808.4	$	1,815.4
Accrued bonuses	127.7		229.6
Employment-based contingent cash consideration	141.8		156.8
Other	124.1		110.7
Total	$	2,202.0	$	2,312.5

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Segment Reporting - Total Segments to Partnership Income before Provision for Taxes Reconciliation (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014	Dec. 31, 2014	Jun. 30, 2014
Segment Reporting Information [Line Items]
Revenues	$ 1,136.8	$ 1,147.4
Expenses	1,027.0	1,099.0
Other income	505.5	424.0
Economic net income	615.3	472.4
Total assets	35,013.2		35,994.3
Total Reportable Segments
Segment Reporting Information [Line Items]
Revenues	884.9	896.5
Expenses	612.2	584.8
Other income	0	0
Economic net income	272.7	311.7
Total assets	7,120.0			7,120.0
Consolidated Funds
Segment Reporting Information [Line Items]
Revenues	226.3	250.7
Expenses	292.8	339.8
Other income	507.8	426.9
Economic net income	441.3	337.8
Total assets	28,096.6		28,809.8
Reconciling Items
Segment Reporting Information [Line Items]
Revenues	25.6	0.2
Expenses	122.0	174.4
Other income	(2.3)	(2.9)
Economic net income	(98.7)	(177.1)
Total assets	$ (203.4)

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Earnings Per Common Unit - Weighted-Average Common Units Outstanding, Basic and Diluted (Details)	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Earnings Per Share [Line Items]
Basic (in shares)	67,684,674	52,501,412
Diluted (in shares)	72,347,771	59,453,670
The Carlyle Group, L.P.
Earnings Per Share [Line Items]
Basic (in shares)	67,684,674	52,501,412
Diluted (in shares)	67,684,674	52,501,412
Unvested deferred restricted common units
Earnings Per Share [Line Items]
Basic (in shares)	0	0
Diluted (in shares)	4,663,097	6,486,349
Contingently issuable Carlyle Holdings Partnership units
Earnings Per Share [Line Items]
Basic (in shares)	0	0
Diluted (in shares)	0	465,909

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Non-controlling Interests in Consolidated Entities - Additional Information (Details)	Mar. 31, 2014	Mar. 10, 2014
Noncontrolling Interest [Abstract]
Public offering of common units completed by partnership	13,800,000	13,800,000

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Document and Entity Information	3 Months Ended
	Mar. 31, 2015	Apr. 30, 2015
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Mar. 31, 2015
Document Fiscal Year Focus	2014
Document Fiscal Period Focus	Q1
Entity Registrant Name	Carlyle Group L.P.
Entity Central Index Key	0001527166
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		68,906,237

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Commitments and Contingencies

3 Months Ended

Mar. 31, 2015

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Capital Commitments

The Partnership and its unconsolidated affiliates have unfunded commitments to entities within the following segments as of March 31, 2015 (Dollars in millions):

	Unfunded Commitments
Corporate Private Equity	$	2,013.1
Global Market Strategies	364.4
Real Assets	732.9
Investment Solutions	36.9
	$	3,147.3

Of the $3.1 billion of unfunded commitments, approximately $2.8 billion is subscribed individually by senior Carlyle professionals, operating executives and other professionals, with the balance funded directly by the Partnership. In addition to these unfunded commitments, the Partnership may from time to time exercise its right to purchase additional interests in its investment funds that become available in the ordinary course of their operations.

Guaranteed Loans

On August 4, 2001, the Partnership entered into an agreement with a financial institution pursuant to which the Partnership is the guarantor on a credit facility for eligible employees investing in Carlyle sponsored funds. This credit facility renews on an annual basis, allowing for annual incremental borrowings up to an aggregate of $11.3 million, and accrues interest at the lower of the prime rate, as defined, or three-month LIBOR plus 2%, reset quarterly (3.25% weighted-average rate at March 31, 2015). As of March 31, 2015 and December 31, 2014, approximately $7.8 million and $7.9 million, respectively, were outstanding under the credit facility and payable by the employees. The amount funded by the Partnership under this guarantee as of March 31, 2015 was not material. The Partnership believes the likelihood of any material funding under this guarantee to be remote. The fair value of this guarantee is not significant to the consolidated financial statements.

Contingent Obligations (Giveback)

A liability for potential repayment of previously received performance fees of $176.6 million at March 31, 2015, is shown as accrued giveback obligations in the condensed consolidated balance sheets, representing the giveback obligation that would need to be paid if the funds were liquidated at their current fair values at March 31, 2015. However, the ultimate giveback obligation, if any, does not become realized until the end of a fund’s life (see Note 2). The Partnership has recorded $28.4 million and $27.7 million of unbilled receivables from former and current employees and senior Carlyle professionals as of March 31, 2015 and December 31, 2014, respectively, related to giveback obligations, which are included in due from affiliates and other receivables, net in the accompanying condensed consolidated balance sheets. Current and former senior Carlyle professionals and employees are personally responsible for their giveback obligations. The receivables are collateralized by investments made by individual senior Carlyle professionals and employees in Carlyle-sponsored funds. In addition, $322.8 million and $336.5 million have been withheld from distributions of carried interest to senior Carlyle professionals and employees for potential giveback obligations as of March 31, 2015 and December 31, 2014, respectively. Such amounts are held by an entity not included in the accompanying condensed consolidated balance sheets.

If, at March 31, 2015, all of the investments held by the Partnership’s Funds were deemed worthless, a possibility that management views as remote, the amount of realized and distributed carried interest subject to potential giveback would be $1.4 billion, on an after-tax basis where applicable.

Leases

The Partnership leases office space in various countries around the world and maintains its headquarters in Washington, D.C., where it leases its primary office space under a non-cancelable lease agreement expiring on July 31, 2026. Office leases in other locations expire in various years from 2015 through 2031. These leases are accounted for as operating leases. Rent expense was approximately $14.5 million and $12.9 million for the three months ended March 31, 2015 and 2014, respectively, and is included in general, administrative and other expenses in the condensed consolidated statements of operations.

The future minimum commitments for the leases are as follows (Dollars in millions):

2015	$	39.3
2016	51.5
2017	47.7
2018	43.7
2019	38.4
Thereafter	229.6
	$	450.2

The Partnership records contractual escalating minimum lease payments on a straight-line basis over the term of the lease. Deferred rent payable under the leases was $43.2 million and $40.4 million as of March 31, 2015 and December 31, 2014, respectively, and is included in accounts payable, accrued expenses and other liabilities in the accompanying condensed consolidated balance sheets.

Legal Matters

In the ordinary course of business, the Partnership is a party to litigation, investigations, disputes and other potential claims. Certain of these matters are described below. The Partnership is not currently able to estimate the reasonably possible amount of loss or range of loss for the matters that have not been resolved. The Partnership does not believe it is probable that the outcome of any existing litigation, investigations, disputes or other potential claims will materially affect the Partnership or these financial statements. The Partnership believes that the matters described below are without merit and intends to vigorously contest all such allegations for the matters that have not been resolved.

On February 14, 2008, a private class-action lawsuit challenging “club” bids and other alleged anti-competitive business practices was filed in the U.S. District Court for the District of Massachusetts (Police and Fire Retirement System of the City of Detroit v. Apollo Global Management, LLC, later renamed Kirk Dahl v. Bain Capital Partners LLC). The complaint alleges, among other things, that certain global alternative asset firms, including the Partnership, violated Section 1 of the Sherman Act by forming multi-sponsor consortiums for the purpose of bidding collectively in company buyout transactions in certain going private transactions and agreeing not to submit topping bids once such a consortium had announced a signed deal, which the plaintiffs allege constitutes a “conspiracy in restraint of trade.” To avoid the risk and cost associated with continuing the litigation through trial, the Partnership entered into an agreement with plaintiffs on August 29, 2014 to settle all claims against the Partnership without any admission of liability. All of the Partnership's codefendants also reached settlement agreements with plaintiffs. The Court approved all the defendants' settlements, including the Partnership’s, on March 17, 2015. Carlyle Partners IV, L.P. (“CP IV”) and its affiliates incurred the costs of the settlement not covered by insurance. As a result, the Partnership's performance fees from CP IV were reduced by $19.3 million in 2014.

Along with many other companies and individuals in the financial sector, the Partnership and Carlyle Mezzanine Partners, L.P. (“CMP”) are named as defendants in Foy v. Austin Capital, a case filed in June 2009, pending in the State of New Mexico’s First Judicial District Court, County of Santa Fe, which purports to be a qui tam suit on behalf of the State of New Mexico. The suit alleges that investment decisions by New Mexico public investment funds were improperly influenced by campaign contributions and payments to politically connected placement agents. The plaintiffs seek, among other things, actual damages, actual damages for lost income, rescission of the investment transactions described in the complaint and disgorgement of all fees received. In May 2011, the Attorney General of New Mexico moved to dismiss certain defendants including the Partnership and CMP on the grounds that separate civil litigation by the Attorney General is a more effective means to seek recovery for the State from these defendants. The Attorney General has brought two civil actions against certain of those defendants, not including the Partnership defendants. The Attorney General has stated that its investigation is continuing and it may bring additional civil actions.

Carlyle Capital Corporation Limited (“CCC”) was a fund sponsored by the Partnership that invested in AAA-rated residential mortgage backed securities on a highly leveraged basis. In March of 2008, amidst turmoil throughout the mortgage markets and money markets, CCC filed for insolvency protection in Guernsey. Six different lawsuits developed from the CCC insolvency. Four of such lawsuits were dismissed or withdrawn. Two of such lawsuits remain and they are described below.

First, in November 2009, a CCC investor, National Industries Group (Holding) (“National Industries”) instituted legal proceedings in Kuwait’s Court of First Instance (National Industries Group v. Carlyle Group ) seeking to recover losses incurred in connection with an investment in CCC. In July 2011, the Delaware Court of Chancery issued a decision restraining National Industries from proceeding in Kuwait on any CCC-related claims based on the forum selection clause in National Industries’ subscription agreement, which provided for exclusive jurisdiction in the Delaware courts. Notwithstanding the ruling by the Delaware court, National Industries continued to pursue claims in Kuwait against CCC and the Partnership and National Industries also appealed the Delaware ruling. However, the court in Kuwait dismissed National Industries claims without prejudice for failure to serve process. Also, on May 29, 2013, the Delaware Supreme Court affirmed the Chancery Court’s decision and upheld the 2011 injunction barring National Industries from filing or prosecuting any CCC-related action in any forum other than the courts of Delaware. The statute of limitations for claims in Delaware has expired.

Second, the Guernsey liquidators who took control of CCC in March 2008 filed a suit on July 7, 2010 against the Partnership, certain of its affiliates and the former directors of CCC in the Royal Court of Guernsey (Carlyle Capital Corporation Limited v. Conway et al.) seeking $1.0 billion in damages. They allege that the Partnership and the CCC board of directors were negligent, grossly negligent or willfully mismanaged the CCC investment program and breached certain fiduciary duties allegedly owed to CCC and its shareholders. The liquidators further allege (among other things) that the directors and the Partnership put the interests of the Partnership ahead of the interests of CCC and its shareholders and gave priority to preserving and enhancing the Partnership’s reputation and its “brand” over the best interests of CCC. On July 24, 2013, plaintiffs filed an amended complaint, which contained further detail in support of the existing claims but no new defendants or claims. On December 20, 2013, defendants filed a defense to the amended complaint and on June 30, 2014 plaintiffs filed their reply. The Court has set the case schedule and trial is scheduled for the first available date after March 28, 2016.

It is not possible to predict the ultimate outcome of all pending investigations and legal proceedings, and some of the matters discussed above involve claims for potentially large and/or indeterminate amounts of damages. Based on information known by management, management has not concluded that as of the date of this filing the final resolutions of the matters above will have a material effect upon the Partnership’s condensed consolidated financial statements. However, given the potentially large and/or indeterminate amounts of damages sought in certain of these matters and the inherent unpredictability of investigations and litigations, it is possible that an adverse outcome in certain matters could, from time to time, have a material effect on our financial results in any particular period.

Other Contingencies

From 2007 to 2009, a Luxembourg subsidiary of CEREP I, a real estate fund, received proceeds from the sale of real estate located in Paris, France. Based on a provision in the Luxembourg-France tax treaty, it did not report or pay tax in France on gain from the sale. The French tax authorities asserted that CEREP I was ineligible to claim exemptions from French tax under the tax treaty, and issued a tax assessment seeking to collect taxes, interest and penalties.

An income tax hearing on these matters was held on March 11, 2015 in front of the French tax court. On April 15, 2015, the French tax court issued an opinion in this matter that is adverse to CEREP I, holding the Luxembourg property company liable for approximately €105 million (including interest accrued since the beginning of the tax dispute). The Partnership disagrees with the outcome and is appealing. CEREP I has approximately €31 million in assets as of March 31, 2015. The remaining €74 million of the tax obligations will be paid by the Partnership. Additionally, the French Ministry of Justice is expected to continue its investigation of the actions of the Luxembourg property company and its former directors, managers and representatives in claiming the tax treaty exemptions.

The Partnership was required to provide a financial guarantee to the French government in July 2012 for the amount of French tax assessed against CEREP I. Since that time, the Partnership has consolidated CEREP I into its consolidated financial statements. Beginning with the quarter ended December 31, 2013, CEREP I had accrued a €75 million liability with respect to the French tax matter. As of March 31, 2015, CEREP I has increased the liability to €105 million ($112 million) to reflect the French tax court judgment, and the total liability is included in other liabilities of Consolidated Funds in the Partnership's condensed consolidated financial statements. For the three months ended March 31, 2015, CEREP I has recognized a loss of approximately $34 million which has been included in net investment gains/losses of Consolidated Funds, and this amount reduced net income attributable to Carlyle Holdings in the Partnership’s condensed consolidated financial statements. In 2013 and 2014, the Partnership had previously recognized losses of approximately €42 million for the French tax matter, which were reflected in net investment gains/losses of Consolidated Funds and reduced net income attributable to Carlyle Holdings.

Indemnifications

In the normal course of business, the Partnership and its subsidiaries enter into contracts that contain a variety of representations and warranties and provide general indemnifications. The Partnership’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Partnership that have not yet occurred. However, based on experience, the Partnership believes the risk of material loss to be remote.

Risks and Uncertainties

Carlyle’s funds seek investment opportunities that offer the possibility of attaining substantial capital appreciation. Certain events particular to each industry in which the underlying investees conduct their operations, as well as general economic conditions, may have a significant negative impact on the Partnership’s investments and profitability. Such events are beyond the Partnership’s control, and the likelihood that they may occur and the effect on the Partnership cannot be predicted.

Furthermore, certain of the funds’ investments are made in private companies and there are generally no public markets for the underlying securities at the current time. The funds’ ability to liquidate their publicly-traded investments are often subject to limitations, including discounts that may be required to be taken on quoted prices due to the number of shares being sold. The funds’ ability to liquidate their investments and realize value is subject to significant limitations and uncertainties, including among others currency fluctuations and natural disasters.

The funds make investments outside of the United States. Investments outside the U.S. may be subject to less developed bankruptcy, corporate, partnership and other laws (which may have the effect of disregarding or otherwise circumventing the limited liability structures potentially causing the actions or liabilities of one fund or a portfolio company to adversely impact the Partnership or an unrelated fund or portfolio company). Non-U.S. investments are subject to the same risks associated with the Partnership’s U.S. investments as well as additional risks, such as fluctuations in foreign currency exchange rates, unexpected changes in regulatory requirements, heightened risk of political and economic instability, difficulties in managing non-U.S. investments, potentially adverse tax consequences and the burden of complying with a wide variety of foreign laws.

Furthermore, Carlyle is exposed to economic risk concentrations related to certain large investments as well as concentrations of investments in certain industries and geographies.

Additionally, the Partnership encounters credit risk. Credit risk is the risk of default by a counterparty in the Partnership’s investments in debt securities, loans, leases and derivatives that result from a borrower’s, lessee’s or derivative counterparty’s inability or unwillingness to make required or expected payments.

The Partnership considers cash, cash equivalents, securities, receivables, equity-method investments, accounts payable, accrued expenses, other liabilities, loans payable, senior notes, assets and liabilities of Consolidated Funds and contingent and other consideration for acquisitions to be its financial instruments. Except for the senior notes, the carrying amounts reported in the condensed consolidated balance sheets for these financial instruments equal or closely approximate their fair values. The fair value of the senior notes is disclosed in Note 8.

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Contingent Consideration - Maximum Amounts of Cash Obligations with Business Acquisitions and Strategic Investment (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2015
Business Acquisition, Contingent Consideration [Line Items]
Contingent cash obligations	$ 714.8
Liability recognized on financial statements	395.4
Contingent cash consideration | Performance-based
Business Acquisition, Contingent Consideration [Line Items]
Contingent cash obligations	414.8
Liability recognized on financial statements	253.6
Contingent cash consideration | Employment-based
Business Acquisition, Contingent Consideration [Line Items]
Contingent cash obligations	300.0
Liability recognized on financial statements	141.8
Business Acquisitions
Business Acquisition, Contingent Consideration [Line Items]
Contingent cash obligations	486.8
Business Acquisitions | Contingent cash consideration | Performance-based
Business Acquisition, Contingent Consideration [Line Items]
Contingent cash obligations	231.8
Business Acquisitions | Contingent cash consideration | Employment-based
Business Acquisition, Contingent Consideration [Line Items]
Contingent cash obligations	255.0
NGP Investment
Business Acquisition, Contingent Consideration [Line Items]
Contingent cash obligations	228.0
NGP Investment | Contingent cash consideration | Performance-based
Business Acquisition, Contingent Consideration [Line Items]
Contingent cash obligations	183.0
NGP Investment | Contingent cash consideration | Employment-based
Business Acquisition, Contingent Consideration [Line Items]
Contingent cash obligations	$ 45.0

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Non-controlling Interests in Consolidated Entities - Partnership's Non-Controlling Interests in Income (Loss) of Consolidated Entities (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Noncontrolling Interest [Line Items]
Net income attributable to other non-controlling interests in consolidated entities	$ 411.2	$ 339.6
Net loss attributable to partners’ capital appropriated for CLOs	(48.6)	(82.1)
Net income attributable to redeemable non-controlling interests in consolidated entities	76.5	67.0
Non-controlling interests in income of consolidated entities	439.1	324.5
Non-Carlyle interests in Consolidated Funds
Noncontrolling Interest [Line Items]
Net income attributable to other non-controlling interests in consolidated entities	449.9	352.9
Non-Carlyle interests in majority-owned subsidiaries
Noncontrolling Interest [Line Items]
Net income attributable to other non-controlling interests in consolidated entities	(0.8)	(21.3)
Non-controlling interest in carried interest and cash held for carried interest distributions
Noncontrolling Interest [Line Items]
Net income attributable to other non-controlling interests in consolidated entities	$ (37.9)	$ 8.0

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Condensed Consolidated Statements of Operations (Unaudited) (USD $) In Millions, except Share data, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Revenues
Fund management fees	$ 269.5	$ 260.3
Performance fees
Realized	326.8	251.4
Unrealized	246.2	369.1
Total performance fees	573.0	620.5
Investment income (loss)
Realized	8.9	0
Unrealized	(2.1)	6.1
Total investment income	6.8	6.1
Interest and other income	6.0	3.8
Interest and other income of Consolidated Funds	226.3	250.7
Revenue of a consolidated real estate VIE	55.2	6.0
Total revenues	1,136.8	1,147.4
Compensation and benefits
Base compensation	180.1	204.6
Equity-based compensation	89.9	74.2
Performance fee related
Realized	143.0	108.7
Unrealized	173.7	221.6
Total compensation and benefits	586.7	609.1
General, administrative and other expenses	116.8	134.3
Interest	14.6	12.2
Interest and other expenses of Consolidated Funds	237.8	264.0
Interest and other expenses of a consolidated real estate VIE	70.0	49.2
Other non-operating expense	1.1	30.2
Total expenses	1,027.0	1,099.0
Other income
Net investment gains of Consolidated Funds	505.5	424.0
Income before provision for income taxes	615.3	472.4
Provision for income taxes	10.5	16.0
Net income	604.8	456.4
Net income attributable to non-controlling interests in consolidated entities	439.1	324.5
Net income attributable to Carlyle Holdings	165.7	131.9
Net income attributable to non-controlling interests in Carlyle Holdings	126.2	107.3
Net income attributable to The Carlyle Group L.P.	$ 39.5	$ 24.6
Net income attributable to The Carlyle Group L.P. per common unit (see Note 15)
Basic (usd per share)	$ 0.58	$ 0.46
Diluted (usd per share)	$ 0.54	$ 0.41
Weighted-average common units
Basic (in shares)	67,684,674	52,501,412
Diluted (in shares)	72,347,771	59,453,670
Distributions declared per common unit (usd per share)	$ 1.61	$ 1.40

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Accrued Performance Fees

3 Months Ended

Mar. 31, 2015

Deferred Costs [Abstract]

Accrued Performance Fees

Accrued Performance Fees

The components of accrued performance fees are as follows:

	As of
	March 31, 2015		December 31, 2014
	(Dollars in millions)
Corporate Private Equity	$	2,857.3	$	2,932.6
Global Market Strategies	147.1		129.9
Real Assets	321.7		272.9
Investment Solutions	441.1		460.2
Total	$	3,767.2	$	3,795.6

Approximately 51% and 55% of accrued performance fees at March 31, 2015 and December 31, 2014, respectively, are related to Carlyle Partners V, L.P. and Carlyle Europe Partners III, L.P., two of the Partnership’s Corporate Private Equity funds.

Accrued performance fees are shown gross of the Partnership’s accrued performance fee-related compensation, and accrued giveback obligations (see Note 10), which are separately presented in the condensed consolidated balance sheets. The components of the accrued giveback obligations are as follows:

	As of
	March 31, 2015			December 31, 2014
	(Dollars in millions)
Corporate Private Equity	$	(52.4	)	$	(52.4	)
Real Assets	(124.2		)	(52.0		)
Total	$	(176.6	)	$	(104.4	)

Performance Fees

The performance fees included in revenues are derived from the following segments:

	Three Months Ended March 31,
	2015			2014
	(Dollars in millions)
Corporate Private Equity	$	513.3		$	453.2
Global Market Strategies	18.7			66.1
Real Assets	(8.5		)	16.8
Investment Solutions	49.5			84.4
Total	$	573.0		$	620.5

Approximately 58% ($333.7 million) of performance fees for the three months ended March 31, 2015 are related to Carlyle Partners IV, L.P., Carlyle Partners V, L.P. and Carlyle Europe Partners III, L.P., three of the Partnership’s Corporate Private Equity funds, and Carlyle/Riverstone Global Energy and Power Fund III, L.P., one of the Partnership's Real Assets funds. Total revenues recognized from Carlyle Partners IV, L.P., Carlyle Partners V, L.P. and Carlyle Europe Partners III, L.P. were $83.8 million, $175.6 million and $173.7 million, respectively, for the three months ended March 31, 2015. For the three months ended March 31, 2015, total revenue from Carlyle/Riverstone Global Energy and Power Fund III, L.P. was $(64.8) million.

Approximately 67% ($413.1 million) of performance fees for the three months ended March 31, 2014, respectively, were related to Carlyle Partners V, L.P., and Carlyle Europe Partners III, L.P. Total revenues recognized from Carlyle Partners V, L.P., and Carlyle Europe Partners III, L.P. were $270.6 million and $184.6 million, respectively, for the three months ended March 31, 2014.

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Fair Value Measurement

3 Months Ended

Mar. 31, 2015

Fair Value Disclosures [Abstract]

Fair Value Measurement

Fair Value Measurement

The fair value measurement accounting guidance establishes a hierarchal disclosure framework which ranks the observability of market price inputs used in measuring financial instruments at fair value. The observability of inputs is impacted by a number of factors, including the type of financial instrument, the characteristics specific to the financial instrument and the state of the marketplace, including the existence and transparency of transactions between market participants. Financial instruments with readily available quoted prices, or for which fair value can be measured from quoted prices in active markets, will generally have a higher degree of market price observability and a lesser degree of judgment applied in determining fair value.

Financial instruments measured and reported at fair value are classified and disclosed based on the observability of inputs used in the determination of fair values, as follows:

Level I – inputs to the valuation methodology are quoted prices available in active markets for identical instruments as of the reporting date. The type of financial instruments included in Level I include unrestricted securities, including equities and derivatives, listed in active markets. The Partnership does not adjust the quoted price for these instruments, even in situations where the Partnership holds a large position and a sale could reasonably impact the quoted price.

Level II – inputs to the valuation methodology are other than quoted prices in active markets, which are either directly or indirectly observable as of the reporting date. The type of financial instruments in this category includes less liquid and restricted securities listed in active markets, securities traded in other than active markets, government and agency securities, and certain over-the-counter derivatives where the fair value is based on observable inputs. Investments in hedge funds are classified in this category when their net asset value is redeemable without significant restriction.

Level III – inputs to the valuation methodology are unobservable and significant to overall fair value measurement. The inputs into the determination of fair value require significant management judgment or estimation. Financial instruments that are included in this category include investments in privately-held entities, non-investment grade residual interests in securitizations, collateralized loan obligations, and certain over-the-counter derivatives where the fair value is based on unobservable inputs. Investments in fund of funds are generally included in this category.

In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the determination of which category within the fair value hierarchy is appropriate for any given financial instrument is based on the lowest level of input that is significant to the fair value measurement. The Partnership’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the financial instrument.

In certain cases, debt and equity securities are valued on the basis of prices from an orderly transaction between market participants provided by reputable dealers or pricing services. In determining the value of a particular investment, pricing services may use certain information with respect to transactions in such investments, quotations from dealers, pricing matrices, market transactions in comparable investments and various relationships between investments.

The following table summarizes the Partnership’s assets and liabilities measured at fair value on a recurring basis by the above fair value hierarchy levels as of March 31, 2015:

(Dollars in millions)	Level I		Level II		Level III		Total
Assets
Investments of Consolidated Funds:
Equity securities	$	601.1	$	105.6	$	1,393.3	$	2,100.0
Bonds	—		—		1,149.3		1,149.3
Loans	—		—		15,439.4		15,439.4
Partnership and LLC interests(1)	—		—		3,324.8		3,324.8
Hedge funds	—		3,932.3		—		3,932.3
Other	—		—		3.3		3.3
	601.1		4,037.9		21,310.1		25,949.1
Trading securities	—		—		2.2		2.2
Foreign currency forward contracts	—		14.1		—		14.1
Restricted securities of Consolidated Funds	4.1		—		12.6		16.7
Total	$	605.2	$	4,052.0	$	21,324.9	$	25,982.1
Liabilities
Loans payable of Consolidated Funds	$	—	$	—	$	16,554.6	$	16,554.6
Derivative instruments of the CLOs	—		—		27.4		27.4
Contingent consideration(2)	—		—		51.3		51.3
Loans payable of a consolidated real estate VIE	—		—		139.6		139.6
Interest rate swaps	—		2.6		—		2.6
Foreign currency forward contracts	—		8.8		—		8.8
Total	$	—	$	11.4	$	16,772.9	$	16,784.3

(1) Balance represents Fund Investments that the Partnership consolidates one fiscal quarter in arrears.

(2) Related to contingent cash and equity consideration associated with the acquisitions of Claren Road, AlpInvest, ESG, Vermillion and Metropolitan, excluding employment-based contingent consideration (see Note 9).

The following table summarizes the Partnership’s assets and liabilities measured at fair value on a recurring basis by the above fair value hierarchy levels as of December 31, 2014:

(Dollars in millions)	Level I		Level II		Level III		Total
Assets
Investments of Consolidated Funds:
Equity securities	$	346.8	$	156.8	$	1,968.5	$	2,472.1
Bonds	—		—		1,235.8		1,235.8
Loans	—		—		15,084.9		15,084.9
Partnership and LLC interests(1)	—		—		3,481.0		3,481.0
Hedge funds	—		3,753.5		—		3,753.5
Other	—		—		1.5		1.5
	346.8		3,910.3		21,771.7		26,028.8
Trading securities	—		—		3.3		3.3
Restricted securities of Consolidated Funds	4.0		—		8.6		12.6
Total	$	350.8	$	3,910.3	$	21,783.6	$	26,044.7
Liabilities
Loans payable of Consolidated Funds	$	—	$	—	$	16,052.2	$	16,052.2
Derivative instruments of the CLOs	—		—		17.2		17.2
Contingent consideration(2)	—		—		51.1		51.1
Loans payable of a consolidated real estate VIE	—		—		146.2		146.2
Interest rate swaps	—		3.2		—		3.2
Total	$	—	$	3.2	$	16,266.7	$	16,269.9

(1) Balance represents Fund Investments that the Partnership consolidates one fiscal quarter in arrears.

(2) Related to contingent cash and equity consideration associated with the acquisitions of Claren Road, AlpInvest, ESG, Vermillion and Metropolitan, excluding employment-based contingent consideration (see Note 9).

Transfers from Level II to Level I during the three months ended March 31, 2015 were due to the expiration of transferability restrictions on certain equity securities of Consolidated Funds that were previously classified as Level II. There were no transfers from Level II to Level I during the three months ended March 31, 2014.

Investment professionals with responsibility for the underlying investments are responsible for preparing the investment valuations pursuant to the policies, methodologies and templates prepared by the Partnership’s valuation group, which is a team made up of dedicated valuation professionals reporting to the Partnership’s chief accounting officer. The valuation group is responsible for maintaining the Partnership’s valuation policy and related guidance, templates and systems that are designed to be consistent with the guidance found in ASC 820, Fair Value Measurement. These valuations, inputs and preliminary conclusions are reviewed by the fund accounting teams. The valuations are then reviewed and approved by the respective fund valuation subcommittees, which are comprised of the respective fund head(s), segment head, chief financial officer and chief accounting officer, as well as members of the valuation group. The valuation group compiles the aggregate results and significant matters and presents them for review and approval by the global valuation committee, which is comprised of the Partnership’s co-chief executive officers, co-presidents and co-chief operating officers, chief risk officer, chief financial officer, chief accounting officer, deputy chief investment officers for Corporate Private Equity, the business segment heads, and observed by the chief compliance officer, the director of internal audit and the Partnership's audit committee. Additionally, each quarter a sample of valuations are reviewed by external valuation firms.

In the absence of observable market prices, the Partnership values its investments using valuation methodologies applied on a consistent basis. For some investments little market activity may exist. Management’s determination of fair value is then based on the best information available in the circumstances and may incorporate management’s own assumptions and involves a significant degree of judgment, taking into consideration a combination of internal and external factors, including the appropriate risk adjustments for non-performance and liquidity risks. Investments for which market prices are not observable include private investments in the equity of operating companies and real estate properties, and certain debt positions. The valuation technique for each of these investments is described below:

Private Equity and Real Estate Investments – The fair values of private equity investments are determined by reference to projected net earnings, earnings before interest, taxes, depreciation and amortization (“EBITDA”), the discounted cash flow method, public market or private transactions, valuations for comparable companies or sales of comparable assets, and other measures which, in many cases, are unaudited at the time received. The methods used to estimate the fair value of real estate investments include the discounted cash flow method and/or capitalization rate (“cap rate”) analysis. Valuations may be derived by reference to observable valuation measures for comparable companies or transactions (e.g., applying a key performance metric of the investment such as EBITDA or net operating income to a relevant valuation multiple or cap rate observed in the range of comparable companies or transactions), adjusted by management for differences between the investment and the referenced comparables, and in some instances by reference to option pricing models or other similar models. Adjustments to observable valuation measures are frequently made upon the initial investment to calibrate the initial investment valuation to industry observable inputs. Such adjustments are made to align the investment to observable industry inputs for differences in size, profitability, projected growth rates, geography and capital structure if applicable. The adjustments are reviewed with each subsequent valuation to assess how the investment has evolved relative to the observable inputs. Additionally, the investment may be subject to certain specific risks and/or development milestones which are also taken into account in the valuation assessment. Option pricing models and similar tools do not currently drive a significant portion of private equity or real estate valuations and are used primarily to value warrants, derivatives, certain restrictions and other atypical investment instruments.

Credit-Oriented Investments – The fair values of credit-oriented investments are generally determined on the basis of prices between market participants provided by reputable dealers or pricing services. In determining the value of a particular investment, pricing services may use certain information with respect to transactions in such investments, quotations from dealers, pricing matrices, market transactions in comparable investments and various relationships between investments. Specifically, for investments in distressed debt and corporate loans and bonds, the fair values are generally determined by valuations of comparable investments. In some instances, the Partnership may utilize other valuation techniques, including the discounted cash flow method.

CLO Investments and CLO Loans Payable – The Partnership has elected the fair value option to measure the loans payable of the CLOs at fair value, as the Partnership has determined that measurement of the loans payable issued by the CLOs at fair value better correlates with the value of the assets held by the CLOs, which are held to provide the cash flows for the note obligations. The investments of the CLOs are also carried at fair value.

The fair values of the CLO loan and bond assets are primarily based on quotations from reputable dealers or relevant pricing services. In situations where valuation quotations are unavailable, the assets are valued based on similar securities, market index changes, and other factors. The Partnership corroborates quotations from pricing services either with other available pricing data or with its own models. Generally, the loan and bond assets of the CLOs are not actively traded and are classified as Level III.

The fair values of the CLO loans payable and the CLO structured asset positions are determined based on both discounted cash flow analyses and third-party quotes. Those analyses consider the position size, liquidity, current financial condition of the CLOs, the third-party financing environment, reinvestment rates, recovery lags, discount rates and default forecasts and are compared to broker quotations from market makers and third party dealers.

Loans Payable of a Consolidated Real Estate VIE – The Partnership has elected the fair value option to measure the loans payable of a consolidated real estate VIE at fair value. The fair values of the loans are primarily based on discounted cash flows analyses, which consider the liquidity and current financial condition of the consolidated real estate VIE. These loans are classified as Level III.

Fund Investments – The Partnership’s investments in external funds are valued based on its proportionate share of the net assets provided by the third party general partners of the underlying fund partnerships based on the most recent available information which typically has a lag of up to 90 days. The terms of the investments generally preclude the ability to redeem the investment. Distributions from these investments will be received as the underlying assets in the funds are liquidated, the timing of which cannot be readily determined.

The changes in financial instruments measured at fair value for which the Partnership has used Level III inputs to determine fair value are as follows (Dollars in millions):

	Financial Assets Three Months Ended March 31, 2015
	Investments of Consolidated Funds
	Equity securities			Bonds			Loans			Partnership and LLC interests			Other			Trading securities and other			Restricted securities of Consolidated Funds		Total
Balance, beginning of period	$	1,968.5		$	1,235.8		$	15,084.9		$	3,481.0		$	1.5		$	3.3		$	8.6	$	21,783.6
Purchases	12.7			93.4			1,628.2			70.3			—			—			3.9		1,808.5
Sales	(599.6		)	(68.5		)	(343.2		)	(271.9		)	—			—			—		(1,283.2		)
Settlements	—			—			(440.9		)	—			—			—					(440.9		)
Realized and unrealized gains (losses), net
Included in earnings	188.3			11.9			32.8			191.1			2.0			(1.1		)	0.1		425.1
Included in other comprehensive income	(176.6		)	(123.3		)	(522.4		)	(145.7		)	(0.2		)	—			—		(968.2		)
Balance, end of period	$	1,393.3		$	1,149.3		$	15,439.4		$	3,324.8		$	3.3		$	2.2		$	12.6	$	21,324.9
Changes in unrealized gains (losses) included in earnings related to financial assets still held at the reporting date	$	(90.2	)	$	11.1		$	39.8		$	62.2		$	(11.8	)	$	(1.1	)	$	0.1	$	10.1

	Financial Assets Three Months Ended March 31, 2014
	Investments of Consolidated Funds
	Equity securities			Bonds			Loans			Partnership and LLC  interests			Other			Trading securities and other			Restricted securities of Consolidated Funds			Total
Balance, beginning of period	$	2,714.1		$	1,249.5		$	14,067.8		$	3,815.2		$	2.0		$	6.9		$	8.6		$	21,864.1
Transfers in (1)	4.5			—			—			—			—			—			—			4.5
Transfers out (1)	(87.5		)	—			—			—			—			—			—			(87.5		)
Purchases	14.4			99.0			1,787.0			133.8			—			—			—			2,034.2
Sales	(240.3		)	(138.8		)	(372.5		)	(450.9		)	—			(3.6		)	—			(1,206.1		)
Settlements	—			—			(1,177.8		)	—			—			—			—			(1,177.8		)
Realized and unrealized gains (losses), net
Included in earnings	62.9			14.9			23.0			153.8			(0.6		)	1.9			(0.3		)	255.6
Included in other comprehensive income	16.9			(0.7		)	(2.9		)	71.7			—			—			—			85.0
Balance, end of period	$	2,485.0		$	1,223.9		$	14,324.6		$	3,723.6		$	1.4		$	5.2		$	8.3		$	21,772.0
Changes in unrealized gains (losses) included in earnings related to financial assets still held at the reporting date	$	(88.7	)	$	13.7		$	10.0		$	(105.0	)	$	(0.6	)	$	1.9		$	(0.3	)	$	(169.0	)

(1) Transfers into and out of Level III financial assets were due to changes in the observability of market inputs used in the valuation of such assets. Transfers are measured as of the beginning of the period in which the transfer occurs.

	Financial Liabilities Three Months Ended March 31, 2015
	Loans Payable of Consolidated Funds			Derivative Instruments of Consolidated Funds			Contingent Consideration			Loans Payable of a consolidated real estate VIE			Total
Balance, beginning of period	$	16,052.2		$	17.2		$	51.1		$	146.2		$	16,266.7
Initial consolidation of funds	664.4			—			—			—			664.4
Borrowings	939.3			—			—			7.8			947.1
Paydowns	(538.5		)	—			(0.5		)	(18.9		)	(557.9		)
Sales	—			(0.8		)	—			—			(0.8		)
Realized and unrealized (gains) losses, net
Included in earnings	55.8			9.0			0.7			13.0			78.5
Included in other comprehensive income	(618.6		)	2.0			—			(8.5		)	(625.1		)
Balance, end of period	$	16,554.6		$	27.4		$	51.3		$	139.6		$	16,772.9
Changes in unrealized (gains) losses included in earnings related to financial liabilities still held at the reporting date	$	46.4		$	(13.9	)	$	0.7		$	13.0		$	46.2

	Financial Liabilities Three Months Ended March 31, 2014
	Loans Payable of Consolidated Funds			Derivative Instruments of Consolidated Funds			Contingent Consideration			Loans Payable of a consolidated real estate VIE			Total
Balance, beginning of period	$	15,220.7		$	13.1		$	178.8		$	122.1		$	15,534.7
Initial consolidation of funds	720.4			—			—			—			720.4
Borrowings	624.6			—			—			9.6			634.2
Paydowns	(949.2		)	—			(72.7		)	(19.1		)	(1,041.0		)
Sales	—			(0.9		)	—			—			(0.9		)
Realized and unrealized losses, net
Included in earnings	69.9			2.5			19.7			10.1			102.2
Included in other comprehensive income	(7.7		)	—			—			2.6			(5.1		)
Balance, end of period	$	15,678.7		$	14.7		$	125.8		$	125.3		$	15,944.5
Changes in unrealized (gains) losses included in earnings related to financial liabilities still held at the reporting date	$	(23.3	)	$	(1.6	)	$	19.1		$	10.1		$	4.3

Realized and unrealized gains and losses included in earnings for Level III investments for trading securities are included in investment income (loss), and such gains and losses for investments of Consolidated Funds and loans payable and derivative instruments of the CLOs are included in net investment gains (losses) of Consolidated Funds in the condensed consolidated statements of operations.

Realized and unrealized gains and losses included in earnings for Level III contingent consideration liabilities are included in other non-operating (income) expenses, and such gains and losses for loans payable of a consolidated real estate VIE are included in interest and other expenses of a consolidated real estate VIE in the condensed consolidated statement of operations.

Gains and losses included in other comprehensive income for all Level III financial asset and liabilities are included in accumulated other comprehensive loss, partner's capital appropriated for Consolidated Funds, non-controlling interests in consolidated entities and non-controlling interests in Carlyle Holdings in the condensed consolidated balance sheets.

The following table summarizes quantitative information about the Partnership’s Level III inputs as of March 31, 2015:

	Fair Value at		Valuation Technique(s)	Unobservable Input(s)	Range (Weighted Average)
(Dollars in millions)	March 31, 2015
Assets
Investments of Consolidated Funds:
Equity securities	$	1,374.8	Comparable Multiple	LTM EBITDA Multiple	4.8x - 16.6x (11.7x)
	18.5		Consensus Pricing	Indicative Quotes ($ per share)	$0 - $218 ($0)
Bonds	1,149.3		Consensus Pricing	Indicative Quotes (% of Par)	1 - 147 (100)
Loans	15,221.2		Consensus Pricing	Indicative Quotes (% of Par)	0 - 139 (98)
	218.2		Market Yield Analysis	Market Yield	5% - 17% (11%)
Partnership and LLC interests	3,324.8		NAV of Underlying Fund(1)	N/A	N/A
Other	3.3		Counterparty Pricing	Indicative Quotes (% of Notional Amount)	0 - 15 (4)
	21,310.1
Trading securities and other	2.2		Comparable Multiple	LTM EBITDA Multiple	5.7x - 5.7x (5.7x)
Restricted securities of Consolidated Funds	12.6		Consensus Pricing	Indicative Quotes (% of Par)	78 - 88 (84)
Total	$	21,324.9
Liabilities
Loans payable of Consolidated Funds:
Senior secured notes	$	15,264.8	Discounted Cash Flow with Consensus Pricing	Discount Rates	1% - 11% (3%)
				Default Rates	1% - 4% (3%)
				Recovery Rates	60% - 75% (66%)
				Indicative Quotes (% of Par)	35 - 101 (98)
Subordinated notes and preferred shares	1,268.6		Discounted Cash Flow with Consensus Pricing	Discount Rates	8% - 15% (10%)
				Default Rates	1% - 4% (3%)
				Recovery Rates	60% - 75% (67%)
				Indicative Quotes (% of Par)	1 - 123 (63)
Combination notes	21.2		Consensus Pricing	Indicative Quotes (% of Par)	99 - 103 (100)
Loans payable of a consolidated real estate VIE	139.6		Discounted Cash Flow	Discount to Expected Payment	0% - 100% (32%)
				Discount Rate	23% - 33% (26%)
Derivative instruments of Consolidated Funds	27.4		Counterparty Pricing	Indicative Quotes (% of Notional Amount)	7 - 37 (21)
Contingent cash consideration(2)	51.3		Discounted Cash Flow	Assumed % of Total Potential Contingent Payments	0% - 100% (19%)
				Discount Rate	5% - 17% (13%)
Total	$	16,772.9

(1) Represents the Partnership’s investments in funds that are valued using the NAV of the underlying fund.

(2) Related to contingent cash consideration associated with the acquisitions of Claren Road, AlpInvest, ESG, Vermillion, and Metropolitan (see Note 9).

The following table summarizes quantitative information about the Partnership’s Level III inputs as of December 31, 2014:

	Fair Value at		Valuation Technique(s)	Unobservable Input(s)	Range (Weighted Average)
(Dollars in millions)	December 31, 2014
Assets
Investments of Consolidated Funds:
Equity securities	$	1,783.7	Comparable Multiple	LTM EBITDA Multiple	4.8x- 16.2x (12.1x)
	168.7		Comparable Multiple	Forward EBITDA Multiple	8.4x-8.4x (8.4x)
	16.1		Consensus Pricing	Indicative Quotes ($ per share)	$0 - $246 ($0)
Bonds	1,235.8		Consensus Pricing	Indicative Quotes (% of Par)	1 - 133 (99)
Loans	14,873.4		Consensus Pricing	Indicative Quotes (% of Par)	0 - 126 (98)
	211.5		Market Yield Analysis	Market Yield	5% - 17% (11%)
Partnership and LLC interests	3,481.0		NAV of Underlying Fund(1)	N/A	N/A
Other	1.5		Counterparty Pricing	Indicative Quotes (% of Notional Amount)	0 - 6 (3)
	21,771.7
Trading securities and other	3.0		Comparable Multiple	LTM EBITDA Multiple	5.8x - 5.8x (5.8x)
	0.3		Discounted Cash Flow	Discount Rate	10% - 10% (10%)
Restricted securities of Consolidated Funds	8.6		Consensus Pricing	Indicative Quotes (% of Par)	87 - 87 (87)
Total	$	21,783.6
Liabilities
Loans payable of Consolidated Funds:
Senior secured notes	$	14,757.5	Discounted Cash Flow with Consensus Pricing	Discount Rates	1% - 11% (3%)
				Default Rates	1% - 3% (2%)
				Recovery Rates	63% - 75% (68%)
				Indicative Quotes (% of Par)	35 - 100 (98)
Subordinated notes and preferred shares	1,278.8		Discounted Cash Flow with Consensus Pricing	Discount Rates	8% - 15% (10%)
				Default Rates	1% - 3% (2%)
				Recovery Rates	63% - 75% (68%)
				Indicative Quotes (% of Par)	1 - 132 (63)
Combination notes	15.9		Consensus Pricing	Indicative Quotes (% of Par)	97 - 98 (98)
Loans payable of a consolidated real estate VIE	146.2		Discounted Cash Flow	Discount to Expected Payment	0% - 100% (36%)
				Discount Rate	23% - 33% (26%)
Derivative instruments of Consolidated Funds	17.2		Counterparty Pricing	Indicative Quotes (% of Notional Amount)	2 - 22 (11)
Contingent cash consideration(2)	51.1		Discounted Cash Flow	Assumed % of Total Potential Contingent Payments	0% - 100% (20%)
				Discount Rate	5% - 18% (13%)
Total	$	16,266.7

(1) Represents the Partnership’s investments in funds that are valued using the NAV of the underlying fund.

(2) Related to contingent cash consideration associated with the acquisitions of Claren Road, AlpInvest, ESG, Vermillion and Metropolitan (see Note 9).

The significant unobservable inputs used in the fair value measurement of the Partnership’s investments in equity securities include EBITDA, indicative quotes and discount rates. Significant decreases in EBITDA multiples or indicative quotes in isolation would result in a significantly lower fair value measurement. Significant increases in discount rates in isolation would result in a significantly lower fair value measurement.

The significant unobservable inputs used in the fair value measurement of the Partnership’s investments in bonds and loans are market yields and indicative quotes. Significant increases in market yields in isolation would result in a significantly lower fair value measurement. Significant decreases in indicative quotes in isolation would result in a significantly lower fair value measurement.

The significant unobservable inputs used in the fair value measurement of the Partnership’s trading securities and other investments include EBITDA multiples and discount rates. Significant decreases in EBITDA multiples in isolation would result in a significantly lower fair value measurement. Significant increases in discount rates in isolation would result in a significantly lower fair value measurement.

The significant unobservable inputs used in the fair value measurement of the Partnership’s restricted securities of Consolidated Funds include indicative quotes. Significant decreases in indicative quotes in isolation would result in a significantly lower fair value measurement.

The significant unobservable inputs used in the fair value measurement of the Partnership’s loans payable of Consolidated Funds are discount rates, default rates, recovery rates and indicative quotes. Significant increases in discount rates or default rates in isolation would result in a significantly lower fair value measurement, while a significant increase in recovery rates and indicative quotes in isolation would result in a significantly higher fair value.

The significant unobservable inputs used in the fair value measurement of the Partnership’s loans payable of a consolidated real estate VIE are discount to expected payment and discount rate. A significant increase in either of these inputs in isolation would result in a significantly lower fair value measurement.

The significant unobservable inputs used in the fair value measurement of the Partnership’s derivative instruments of Consolidated Funds include indicative quotes. Significant decreases in indicative quotes in isolation would result in a significantly lower fair value measurement.

The significant unobservable inputs used in the fair value measurement of the Partnership’s contingent consideration are an assumed percentage of total potential contingent payments and discount rate. A significant decrease in the assumed percentage of total potential contingent payments or increase in discount rate in isolation would result in a significantly lower fair value measurement.

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Equity-Based Compensation

3 Months Ended

Mar. 31, 2015

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Equity-Based Compensation

Equity-Based Compensation

In May 2012, Carlyle Group Management L.L.C., the general partner of the Partnership, adopted The Carlyle Group L.P. 2012 Equity Incentive Plan (the “Equity Incentive Plan”). The Equity Incentive Plan is a source of equity-based awards permitting the Partnership to grant to Carlyle employees, directors of the Partnership’s general partner and consultants non-qualified options, unit appreciation rights, common units, restricted common units, deferred restricted common units, phantom restricted common units and other awards based on the Partnership’s common units and Carlyle Holdings partnership units. The total number of the Partnership’s common units and Carlyle Holdings partnership units which were initially available for grant under the Equity Incentive Plan was 30,450,000. The Equity Incentive Plan contains a provision which automatically increases the number of the Partnership’s common units and Carlyle Holdings partnership units available for grant based on a pre-determined formula; this increase occurs annually on January 1. As of January 1, 2015, pursuant to the formula, the total number of the Partnership’s common units and Carlyle Holdings partnership units available for grant under the Equity Incentive Plan was 31,895,630.

Unvested Partnership Common Units

On August 1, 2013, the Partnership acquired the remaining 40% equity interest in AlpInvest. As part of the transaction, the Partnership issued 914,087 common units to AlpInvest sellers who are employees of the Partnership that are subject to vesting conditions.

These newly issued common units were unvested at grant and vest over a period of up to five years. The unvested common units are accounted for as equity-based compensation in accordance with ASC Topic 718, Compensation – Stock Compensation (“ASC 718”). The grant-date fair value of the unvested common units is charged to equity-based compensation on a straight-line basis over the required service period. Additionally, the calculation of the expense assumes a forfeiture rate of up to 5%. For the three months ended March 31, 2015 and 2014, the Partnership recorded $2.9 million and $2.1 million in equity-based compensation expense associated with these awards, respectively. As of March 31, 2015, the total unrecognized equity-based compensation expense related to unvested common units, considering estimated forfeitures, is $8.1 million, which is expected to be recognized over a weighted-average term of 1.0 year.

Unvested Carlyle Holdings Partnership Units

Unvested Carlyle Holdings partnership units are held by senior Carlyle professionals and other individuals engaged in Carlyle’s business and generally vest ratably over a six-year period. The unvested Carlyle Holdings partnership units are accounted for as equity-based compensation in accordance with ASC 718. The grant-date fair value of the unvested Carlyle Holdings partnership units are charged to equity-based compensation expense on a straight-line basis over the required service period. Additionally, the calculation of the expense assumes a forfeiture rate of up to 2.5%. The Partnership recorded equity-based compensation expense associated with these awards of $42.0 million and $44.8 million for the three months ended March 31, 2015 and 2014, respectively. No tax benefits have been recorded related to the unvested Carlyle Holdings partnership units, as the vesting of these units does not result in a tax deduction to the corporate taxpayers.

In connection with the Partnership’s investment in NGP Management in December 2012, the Partnership issued 996,572 Carlyle Holdings partnership units to ECM Capital, L.P. which vest ratably over a period of five years. The Partnership also issued 597,944 Carlyle Holdings partnership units to ECM Capital, L.P. that were issued at closing but vest upon the achievement of performance conditions. The fair value of these units will be recognized as a reduction to the Partnership’s investment income in NGP Management over the relevant service or performance period, based on the fair value of the units on each reporting date and adjusted for the actual fair value of the units at each vesting date. For the Carlyle Holdings partnership units that vest based on the achievement of performance conditions, the Partnership uses the minimum number of partnership units within the range of potential values for measurement and recognition purposes.

As of March 31, 2015, the total unrecognized equity-based compensation expense related to unvested Carlyle Holdings partnership units, considering estimated forfeitures, is $587.4 million, which is expected to be recognized over a weighted-average term of 3.1 years.

Deferred Restricted Common Units

The deferred restricted common units are unvested when granted and vest ratably over a service period, which ranges up to six years. The grant-date fair value of the deferred restricted common units granted to Carlyle’s employees is charged to equity-based compensation expense on a straight-line basis over the required service period. Additionally, the calculation of the expense assumes a forfeiture rate that generally ranges from 2% to 10% and a per unit discount that generally ranges up to 25%, as these unvested awards do not participate in any Partnership distributions. During the three months ended March 31, 2015, the Partnership revised its estimated forfeiture rates to 2% to 10% from a previous range of 5% to 15%. As a result, the Partnership recognized $7.5 million of equity-based compensation expense during the three months ended March 31, 2015 for the cumulative effect of the change in this estimate. The Partnership recorded compensation expense of $44.3 million and $26.9 million for the three months ended March 31, 2015 and 2014, respectively, with $4.1 million and $3.3 million of corresponding deferred tax benefits, respectively. As of March 31, 2015, the total unrecognized equity-based compensation expense related to unvested deferred restricted common units, considering estimated forfeitures, is $443.2 million, which is expected to be recognized over a weighted-average term of 3.0 years.

Equity-based awards issued to non-employees are recognized as general, administrative and other expenses. The expense associated with the deferred restricted common units granted to NGP personnel by the Partnership are recognized as a reduction of the Partnership’s investment income in NGP Management. The grant-date fair value of deferred restricted common units granted to Carlyle’s non-employee directors is charged to expense on a straight-line basis over the vesting period. The cost of services received in exchange for an equity-based award issued to consultants is measured at each vesting date. Equity-based awards that require the satisfaction of future service criteria are recognized over the relevant service period, adjusted for estimated forfeitures of awards not expected to vest, based on the fair value of the award on each reporting date and adjusted for the actual fair value of the award at each vesting date. The expense for equity-based awards issued to non-employees was not significant for the three months ended March 31, 2015 and 2014.

Phantom Deferred Restricted Common Units

The phantom deferred restricted common units are unvested when granted and vest ratably over a service period of three years. Upon vesting, the units will be settled in cash. As the phantom deferred restricted common units will be settled in cash, they are accounted for as liability awards. The fair value of the units is re-measured at each reporting period until settlement and charged to equity-based compensation expense over the vesting period. Additionally, the calculation of the expense assumes a forfeiture rate of 10%. During the three months ended March 31, 2015, the Partnership revised its estimated forfeiture rate to 10% from 15%. The cumulative effect of the change in this estimate was not material. The Partnership recorded $0.7 million and $0.4 million in equity-based compensation expense associated with these awards for the three months ended March 31, 2015 and 2014, respectively. The tax benefits recognized from these awards was not material during these periods. As of March 31, 2015, the total unrecognized equity-based compensation expense related to unvested phantom deferred restricted common units, considering estimated forfeitures, is $0.8 million, which is expected to be recognized over a weighted-average term of 0.4 years.

A summary of the status of the Partnership’s non-vested equity-based awards as of March 31, 2015 and a summary of changes for the three months ended March 31, 2015, are presented below:

	Carlyle Holdings			The Carlyle Group, L.P.
				Equity Settled Awards						Cash Settled Awards
Unvested Units	Partnership Units	Weighted- Average Grant Date Fair Value		Deferred Restricted Common Units	Weighted- Average Grant Date Fair Value		Unvested Common Units	Weighted- Average Grant Date Fair Value		Phantom Units	Weighted- Average Grant Date Fair Value
Balance, December 31, 2014	35,997,415	$	22.16	18,929,270	$	26.12	809,797	$	27.19	104,070	$	23.40
Granted	—	$	—	4,981,436	$	23.83	—	$	—	—	$	—
Vested	—	$	—	931,965	$	28.90	31,132	$	21.53	3,408	$	34.81
Forfeited	91,174	$	22.00	512,748	$	24.01	—	$	—	2,950	$	23.41
Balance, March 31, 2015	35,906,241	$	22.16	22,465,993	$	25.51	778,665	$	27.42	97,712	$	23.00

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Related Party Transactions

3 Months Ended

Mar. 31, 2015

Related Party Transactions [Abstract]

Related Party Transactions

Related Party Transactions

Due from Affiliates and Other Receivables, Net

The Partnership had the following due from affiliates and other receivables at March 31, 2015 and December 31, 2014:

	As of
	March 31, 2015		December 31, 2014
	(Dollars in millions)
Unbilled receivable for giveback obligations from current and former employees	$	28.4	$	27.7
Notes receivable and accrued interest from affiliates	11.7		11.1
Other receivables from unconsolidated funds and affiliates, net	162.7		160.6
Total	$	202.8	$	199.4

Notes receivable represent loans that the Partnership has provided to certain unconsolidated funds to meet short-term obligations to purchase investments. Other receivables from certain of the unconsolidated funds and portfolio companies relate to management fees receivable from limited partners, advisory fees receivable and expenses paid on behalf of these entities. These costs represent costs related to the pursuit of actual or proposed investments, professional fees and expenses associated with the acquisition, holding and disposition of the investments. The affiliates are obligated at the discretion of the Partnership to reimburse the expenses. Based on management’s determination, the Partnership accrues and charges interest on amounts due from affiliate accounts at interest rates ranging up to 7.17% as of March 31, 2015. The accrued and charged interest to the affiliates was not significant for any period presented.

These receivables are assessed regularly for collectability and amounts determined to be uncollectible are charged directly to general, administrative and other expenses in the condensed consolidated statements of operations. A corresponding allowance for doubtful accounts is recorded and such amounts were not significant for any period presented.

Due to Affiliates

The Partnership had the following due to affiliates balances at March 31, 2015 and December 31, 2014:

	As of
	March 31, 2015		December 31, 2014
	(Dollars in millions)
Due to affiliates of Consolidated Funds	$	0.2	$	0.6
Due to non-consolidated affiliates	41.6		37.1
Performance-based contingent cash and equity consideration related to acquisitions	46.8		43.6
Amounts owed under the tax receivable agreement	88.1		89.0
Other	14.8		13.9
Total	$	191.5	$	184.2

The Partnership has recorded obligations for amounts due to certain of its affiliates. The Partnership periodically offsets expenses it has paid on behalf of its affiliates against these obligations. The amount owed under the tax receivable agreement is related primarily to the acquisition by the Partnership of 9,300,000 Carlyle Holdings partnership units in March 2014 (see Note 1), as well as the exchange in May 2012 by CalPERS of its Carlyle Holdings partnership units for Partnership common units.

Other Related Party Transactions

In the normal course of business, the Partnership has made use of aircraft owned by entities controlled by senior Carlyle professionals. The senior Carlyle professionals paid for their purchases of the aircraft and bear all operating, personnel and maintenance costs associated with their operation for personal use. Payment by the Partnership for the business use of these aircraft by senior Carlyle professionals and other employees is made at market rates, which totaled $1.1 million and $1.5 million for the three months ended March 31, 2015 and 2014, respectively. These fees are included in general, administrative, and other expenses in the condensed consolidated statements of operations.

Senior Carlyle professionals and employees are permitted to participate in co-investment entities that invest in Carlyle funds or alongside Carlyle funds. In many cases, participation is limited by law to individuals who qualify under applicable legal requirements. These co-investment entities generally do not require senior Carlyle professionals and employees to pay management or performance fees, however, Carlyle professionals and employees are required to pay their portion of partnership expenses.

Carried interest income from the funds can be distributed to senior Carlyle professionals and employees on a current basis, but is subject to repayment by the subsidiary of the Partnership that acts as general partner of the fund in the event that certain specified return thresholds are not ultimately achieved. The senior Carlyle professionals and certain other investment professionals have personally guaranteed, subject to certain limitations, the obligation of these subsidiaries in respect of this general partner obligation. Such guarantees are several and not joint and are limited to a particular individual’s distributions received.

The Partnership does business with some of its portfolio companies; all such arrangements are on a negotiated basis.

Substantially all revenue is earned from affiliates of Carlyle.

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Commitments and Contingencies - Future Minimum Commitments for Leases (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2015
Commitments and Contingencies Disclosure [Abstract]
2015	$ 39.3
2016	51.5
2017	47.7
2018	43.7
2019	38.4
Thereafter	229.6
Future minimum commitments for leases, total	$ 450.2

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Borrowings

3 Months Ended

Mar. 31, 2015

Debt Disclosure [Abstract]

Borrowings

Borrowings

The Partnership borrows and enters into credit agreements for its general operating and investment purposes. The Partnership’s borrowings consist of the following (Dollars in millions):

	As of March 31, 2015				As of December 31, 2014
	Borrowing Outstanding		Carrying Value		Borrowing Outstanding		Carrying Value
Term Loan Due 8/09/2018	$	25.0	$	25.0	$	25.0	$	25.0
Term Loan (1)	13.4		13.4		15.2		15.2
3.875% Senior Notes Due 2/01/2023	500.0		499.9		500.0		499.9
5.625% Senior Notes Due 3/30/2043	600.0		606.8		600.0		606.8
	$	1,138.4	$	1,145.1	$	1,140.2	$	1,146.9

(1) Due the earlier of September 28, 2018 or the date that the CLO is dissolved.

Senior Credit Facility

As of March 31, 2015, the senior credit facility included $500.0 million in a term loan and $750.0 million in a revolving credit facility. As of March 31, 2015, the term loan and revolving credit facility were scheduled to mature on August 9, 2018; however, they were amended as described below on May 5, 2015. Principal amounts outstanding under the term loan and revolving credit facility accrue interest, at the option of the borrowers, either (a) at an alternate base rate plus an applicable margin not to exceed 0.75%, or (b) at LIBOR plus an applicable margin not to exceed 1.75% (at March 31, 2015, the interest rate was 1.43%). Interest expense under the senior credit facility was not significant for the three months ended March 31, 2015 and 2014. The fair value of the outstanding balances of the term loan and revolving credit facility at March 31, 2015 and December 31, 2014 approximated par value based on current market rates for similar debt instruments and are classified as Level III within the fair value hierarchy.

On May 5, 2015, the Partnership entered into Amendment No. 2 to the senior credit facility, which: (i) extends the maturity date of the term loan and revolving credit facility from August 9, 2018 to May 5, 2020, (ii) revises the management fee earning assets covenant to remove the step up requirement to add a percentage of future acquired AUM and to set the minimum management fee earning assets amount, (iii) changes the definition of Indebtedness to provide for a deduction of unrestricted cash, and (iv) reduces the corporate ratings-based pricing grid.

Other Borrowings

On October 3, 2013, the Partnership borrowed €12.6 million ($13.4 million at March 31, 2015) under a new term loan and security agreement with a financial institution. Proceeds from the borrowing were used to fund the Partnership’s investment in a CLO. Interest on the term loan accrues at EURIBOR plus 1.75% (1.77% at March 31, 2015). The Partnership may prepay the facility in whole or in part at any time without penalty. The facility is scheduled to mature on the earlier of 5 years after closing or the date that the CLO is dissolved. The facility is secured by the Partnership’s investment in the CLO. Interest expense on the term loan was not significant for the three months ended March 31, 2015 and 2014. The fair value of the outstanding balance of the term loan at March 31, 2015 and December 31, 2014 approximated par value based on current market rates for similar debt instruments and is classified as Level III within the fair value hierarchy.

3.875% Senior Notes

In January 2013, an indirect finance subsidiary of the Partnership issued $500.0 million in aggregate principal amount of 3.875% senior notes due February 1, 2023 at 99.966% of par. Interest is payable semi-annually on February 1 and August 1, beginning August 1, 2013. This subsidiary may redeem the senior notes in whole at any time or in part from time to time at a price equal to the greater of 100% of the principal amount of the notes being redeemed and the sum of the present values of the remaining scheduled payments of principal and interest on any notes being redeemed discounted to the redemption date on a semi-annual basis at the Treasury rate plus 30 basis points plus accrued and unpaid interest on the principal amounts being redeemed to the redemption date.

Interest expense on the notes was $5.0 million for the three months ended March 31, 2015 and 2014. At March 31, 2015 and December 31, 2014, the fair value of the notes was approximately $521.7 million and $513.1 million, respectively, based on indicative quotes. The notes are classified as Level II within the fair value hierarchy.

5.625% Senior Notes

In March 2013, an indirect finance subsidiary of the Partnership issued $400.0 million in aggregate principal amount of 5.625% senior notes due March 30, 2043 at 99.583% of par. Interest is payable semi-annually on March 30 and September 30, beginning September 30, 2013. This subsidiary may redeem the senior notes in whole at any time or in part from time to time at a price equal to the greater of 100% of the principal amount of the notes being redeemed and the sum of the present values of the remaining scheduled payments of principal and interest on any notes being redeemed discounted to the redemption date on a semi-annual basis at the Treasury rate plus 40 basis points plus accrued and unpaid interest on the principal amounts being redeemed to the redemption date.

In March 2014, an indirect finance subsidiary of the Partnership issued $200.0 million of 5.625% Senior Notes due March 30, 2043 at 104.315% of par. The net proceeds from the issuance of these notes are being used for general corporate purposes, including investments in Carlyle’s funds as well as investment capital for acquisitions of new fund platforms and strategies or other growth initiatives, to drive innovation across the broader Carlyle platform. These notes were issued as additional 5.625% Senior Notes and will be treated as a single class with the already outstanding $400.0 million aggregate principal amount of these senior notes.

Interest expense on the notes was $8.4 million and $6.3 million for the three months ended March 31, 2015 and 2014, respectively. At March 31, 2015 and December 31, 2014, the fair value of the notes was approximately $682.6 million and $699.2 million, respectively, based on indicative quotes. The notes are classified as Level II within the fair value hierarchy.

Interest Rate Swaps

The Partnership is subject to interest rate risk associated with its variable rate debt financing. To manage this risk, the Partnership has an outstanding interest rate swap to fix the base LIBOR interest rate on its term loan borrowings with a notional amount of $381.3 million at March 31, 2015 that amortizes through September 30, 2016.

In the first quarter of 2013, $475.0 million of term loan principal was prepaid. As a result of these term loan prepayments, the interest rate swap is no longer accounted for as a cash flow hedge; the interest rate swap is accounted for as a freestanding derivative instrument recorded at fair value each period with changes in fair value recorded through earnings. The pre-existing hedge loss included in accumulated other comprehensive loss for this interest rate swap of $8.8 million is being reclassified into earnings as the original forecasted transactions affect earnings.

In March 2013, the Partnership entered into a second interest rate swap with a notional amount of $356.3 million at March 31, 2015 that amortizes through September 30, 2016. This interest rate swap is accounted for as a freestanding derivative instrument recorded at fair value each period with changes in fair value recorded through earnings.

Debt Covenants

The Partnership is subject to various financial covenants under its loan agreements including, among other items, maintenance of a minimum amount of management fee-earning assets. The Partnership is also subject to various non-financial covenants under its loan agreements and the indentures governing its senior notes. The Partnership was in compliance with all financial and non-financial covenants under its various loan agreements as of March 31, 2015.

The consolidated real estate VIE was not in compliance with the debt covenants related to substantially all of its loans payable as of March 31, 2015 (see Note 17); such violations do not cause a default or event of default under the Partnership’s senior credit facility, 2013 term loan, senior notes, or the loans payable of Consolidated Funds.

Loans Payable of Consolidated Funds

Loans payable of Consolidated Funds represent amounts due to holders of debt securities issued by the CLOs. Several of the CLOs issued preferred shares representing the most subordinated interest, however these tranches are mandatorily redeemable upon the maturity dates of the senior secured loans payable, and as a result have been classified as liabilities and are included in loans payable of Consolidated Funds in the condensed consolidated balance sheets.

As of March 31, 2015 and December 31, 2014, the following borrowings were outstanding, which includes preferred shares classified as liabilities (Dollars in millions):

	As of March 31, 2015
	Borrowing Outstanding		Fair Value		Weighted Average Interest Rate			Weighted Average Remaining Maturity in Years
Senior secured notes	$	15,528.1	$	15,264.8	1.70	%	%	9.17
Subordinated notes and preferred shares	1,238.2		1,268.6		N/A		(a)	8.21
Combination notes	20.0		21.2		N/A		(b)	8.19
Total	$	16,786.3	$	16,554.6

	As of December 31, 2014
	Borrowing Outstanding		Fair Value		Weighted Average Interest Rate			Weighted Average Remaining Maturity in Years
Senior secured notes	$	15,104.2	$	14,757.5	1.68	%	%	9.21
Subordinated notes and preferred shares	1,242.3		1,278.8		N/A		(a)	8.28
Combination notes	15.0		15.9		N/A		(b)	7.14
Total	$	16,361.5	$	16,052.2

(a) The subordinated notes and preferred shares do not have contractual interest rates, but instead receive distributions from the excess cash flows of the CLOs.

(b) The combination notes do not have contractual interest rates and have recourse only to the securities specifically held to collateralize such combination notes.

Loans payable of the CLOs are collateralized by the assets held by the CLOs and the assets of one CLO may not be used to satisfy the liabilities of another. This collateral consisted of cash and cash equivalents, corporate loans, corporate bonds and other securities. As of March 31, 2015 and December 31, 2014, the fair value of the CLO assets was $18.2 billion and $17.6 billion, respectively.

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Accrued Performance Fees - Components of Accrued Giveback Obligations (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Segment Reporting Information [Line Items]
Accrued giveback obligations	$ (176.6)	$ (104.4)
Corporate Private Equity
Segment Reporting Information [Line Items]
Accrued giveback obligations	(52.4)	(52.4)
Real Assets
Segment Reporting Information [Line Items]
Accrued giveback obligations	$ (124.2)	$ (52.0)

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Supplemental Financial Information - Supplemental Results of Operations (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Revenues
Fund management fees	$ 269.5	$ 260.3
Performance fees
Realized	326.8	251.4
Unrealized	246.2	369.1
Total performance fees	573.0	620.5
Investment income (loss)
Realized	8.9	0
Unrealized	(2.1)	6.1
Investment income (loss)	6.8	6.1
Interest and other income	6.0	3.8
Interest and other income of Consolidated Funds	226.3	250.7
Revenue of a consolidated real estate VIE	55.2	6.0
Total revenues	1,136.8	1,147.4
Compensation and benefits
Base compensation	180.1	204.6
Equity-based compensation	89.9	74.2
Performance fee related
Realized	143.0	108.7
Unrealized	173.7	221.6
Total compensation and benefits	586.7	609.1
General, administrative and other expenses	116.8	134.3
Interest	14.6	12.2
Interest and other expenses of Consolidated Funds	237.8	264.0
Interest and other expenses of a consolidated real estate VIE	70.0	49.2
Other non-operating expense	1.1	30.2
Total expenses	1,027.0	1,099.0
Other income
Net investment gains of Consolidated Funds	505.5	424.0
Income before provision for income taxes	615.3	472.4
Provision for income taxes	10.5	16.0
Net income	604.8	456.4
Net income (loss) attributable to non-controlling interests in consolidated entities	439.1	324.5
Net income attributable to Carlyle Holdings	165.7	131.9
Net income attributable to non-controlling interests in Carlyle Holdings	126.2	107.3
Net income attributable to The Carlyle Group L.P.	39.5	24.6
Consolidated Operating Entities
Revenues
Fund management fees	309.7	305.7
Performance fees
Realized	326.0	257.4
Unrealized	254.5	386.6
Total performance fees	580.5	644.0
Investment income (loss)
Realized	(69.8)	2.1
Unrealized	45.6	7.8
Investment income (loss)	(24.2)	9.9
Interest and other income	6.5	4.5
Interest and other income of Consolidated Funds	0	0
Revenue of a consolidated real estate VIE	55.2	6.0
Total revenues	927.7	970.1
Compensation and benefits
Base compensation	180.1	204.6
Equity-based compensation	89.9	74.2
Performance fee related
Realized	143.0	108.7
Unrealized	173.7	221.6
Total compensation and benefits	586.7	609.1
General, administrative and other expenses	116.8	134.4
Interest	14.6	12.2
Interest and other expenses of Consolidated Funds	0	0
Interest and other expenses of a consolidated real estate VIE	70.0	49.2
Other non-operating expense	1.1	30.2
Total expenses	789.2	835.1
Other income
Net investment gains of Consolidated Funds	0	0
Income before provision for income taxes	138.5	135.0
Provision for income taxes	10.5	16.0
Net income	128.0	119.0
Net income (loss) attributable to non-controlling interests in consolidated entities	(37.7)	(12.9)
Net income attributable to Carlyle Holdings	165.7	131.9
Net income attributable to non-controlling interests in Carlyle Holdings	126.2	107.3
Net income attributable to The Carlyle Group L.P.	39.5	24.6
Consolidated Funds
Revenues
Fund management fees	0	0
Performance fees
Realized	0	0
Unrealized	0	0
Total performance fees	0	0
Investment income (loss)
Realized	0	0
Unrealized	0	0
Investment income (loss)	0	0
Interest and other income	0	0
Interest and other income of Consolidated Funds	226.3	250.7
Revenue of a consolidated real estate VIE	0	0
Total revenues	226.3	250.7
Compensation and benefits
Base compensation	0	0
Equity-based compensation	0	0
Performance fee related
Realized	0	0
Unrealized	0	0
Total compensation and benefits	0	0
General, administrative and other expenses	0	0
Interest	0	0
Interest and other expenses of Consolidated Funds	292.8	339.8
Interest and other expenses of a consolidated real estate VIE	0	0
Other non-operating expense	0	0
Total expenses	292.8	339.8
Other income
Net investment gains of Consolidated Funds	507.8	426.9
Income before provision for income taxes	441.3	337.8
Provision for income taxes	0	0
Net income	441.3	337.8
Net income (loss) attributable to non-controlling interests in consolidated entities	0	0
Net income attributable to Carlyle Holdings	441.3	337.8
Net income attributable to non-controlling interests in Carlyle Holdings	0	0
Net income attributable to The Carlyle Group L.P.	441.3	337.8
Eliminations
Revenues
Fund management fees	(40.2)	(45.4)
Performance fees
Realized	0.8	(6.0)
Unrealized	(8.3)	(17.5)
Total performance fees	(7.5)	(23.5)
Investment income (loss)
Realized	78.7	(2.1)
Unrealized	(47.7)	(1.7)
Investment income (loss)	31.0	(3.8)
Interest and other income	(0.5)	(0.7)
Interest and other income of Consolidated Funds	0	0
Revenue of a consolidated real estate VIE	0	0
Total revenues	(17.2)	(73.4)
Compensation and benefits
Base compensation	0	0
Equity-based compensation	0	0
Performance fee related
Realized	0	0
Unrealized	0	0
Total compensation and benefits	0	0
General, administrative and other expenses	0	(0.1)
Interest	0	0
Interest and other expenses of Consolidated Funds	(55.0)	(75.8)
Interest and other expenses of a consolidated real estate VIE	0	0
Other non-operating expense	0	0
Total expenses	55.0	75.9
Other income
Net investment gains of Consolidated Funds	(2.3)	(2.9)
Income before provision for income taxes	35.5	(0.4)
Provision for income taxes	0	0
Net income	35.5	(0.4)
Net income (loss) attributable to non-controlling interests in consolidated entities	476.8	337.4
Net income attributable to Carlyle Holdings	(441.3)	(337.8)
Net income attributable to non-controlling interests in Carlyle Holdings	0	0
Net income attributable to The Carlyle Group L.P.	$ (441.3)	$ (337.8)

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Investments

3 Months Ended

Mar. 31, 2015

Equity Method Investments and Joint Ventures [Abstract]

Investments

Investments

Investments consist of the following:

	As of
	March 31, 2015		December 31, 2014
	(Dollars in millions)
Equity method investments, excluding accrued performance fees	$	917.2	$	918.7
Trading securities and other investments	27.0		12.9
Total investments	$	944.2	$	931.6

Strategic Investment in NGP

On December 20, 2012, the Partnership entered into separate purchase agreements with ECM Capital, L.P. and Barclays Natural Resource Investments, a division of Barclays Bank PLC (“BNRI”), pursuant to which the Partnership agreed to invest in NGP Management Company, L.L.C. (“NGP Management” and, together with its affiliates, “NGP”). NGP is an Irving, Texas-based energy investor.

The Partnership’s equity interests in NGP Management entitle the Partnership to an allocation of income equal to 55.0% of the management fee-related revenues of the NGP entities that serve as the advisors to certain private equity funds, and future interests in the general partners of certain future carry funds advised by NGP that entitle the Partnership to an allocation of income equal to 47.5% of the carried interest received by such fund general partners. For periods prior to 2015, the Partnership's allocation of income related to management fee-related revenues of NGP was 47.5%. This increase in the allocation of income did not result in a change in accounting for the investment as an equity method investment. The Partnership has an option, exercisable by the Partnership in approximately 10 years, to purchase from ECM Capital, L.P. and its affiliates, for a formulaic purchase price in cash based upon a measure of the earnings of NGP, the remaining equity interests in NGP Management.

In July 2014, the Partnership exercised another option granted in 2012 to acquire from BNRI its interests in the general partner of NGP X, which entitles the Partnership to an allocation of income equal to 40% of the carried interest received by the fund’s general partner. The Partnership additionally acquired certain general partner investments in the NGP X fund. As of March 31, 2015 and December 31, 2014, the carrying value of the Partnership's investment in the NGP X general partner attributable to the carried interest allocation was approximately $3.9 million and $18.5 million, respectively, and the carrying value of the Partnership's general partner investments in the NGP X fund were $21.3 million and $20.4 million, respectively.

In consideration for these interests and option, the Partnership paid an aggregate of $504.6 million in cash to ECM Capital, L.P. and BNRI, and issued 996,572 Carlyle Holdings partnership units to ECM Capital, L.P. that vest ratably over a period of five years. The transaction also includes contingent consideration payable to ECM Capital, L.P. of up to $45.0 million in cash, 597,944 Carlyle Holdings partnership units that were issued at closing but vest upon the achievement of performance conditions, and contingently issuable Carlyle Holdings partnership units up to $15.0 million that will be issued if the performance conditions are met. The contingent consideration is payable from 2015 through 2018, depending on NGP’s achievement of certain business performance goals. Additionally, the transaction includes contingent consideration payable to BNRI of up to $183.0 million, which will be payable in 2016 approximately one-third in cash and approximately two-thirds by a six year promissory note issued by the Partnership, if the performance conditions are met. The promissory note will accrue interest at the three month LIBOR plus 2.5%.

As of March 31, 2015, the NGP Natural Resources XI, L.P. fund (“NGP XI”) had closed on aggregate commitments of approximately $5.3 billion. The management fees for this fund will turn on over the next year or sooner as the fund deploys capital. Based on the amount of NGP XI commitments raised through March 31, 2015, it is probable that BNRI will be entitled to receive the contingent consideration when such payment becomes due. Accordingly, as of March 31, 2015, the Partnership has accrued $183.0 million related to this future payment obligation. The timing of the cash payment and issuance of the promissory note to BNRI is based on the contractual agreement between the Partnership and BNRI, which is estimated to be in early 2016.

The Partnership also has a senior advisor consulting agreement with the chief executive officer of NGP and granted in 2012 deferred restricted common units to a group of NGP personnel who are providing the Partnership with consulting services.

The Partnership accounts for its investment in NGP Management under the equity method of accounting. The Partnership recorded its investment in NGP Management initially at cost, excluding any elements in the transaction that were deemed to be compensatory arrangements to NGP personnel. The Carlyle Holdings partnership units issued in the transaction, the contingently issuable Carlyle Holdings partnership units, and the deferred restricted common units were deemed to be compensatory arrangements; these elements are recognized as an expense under applicable U.S. GAAP.

The Partnership records investment income (loss) for its equity income allocation from NGP management fees and performance fees, and also records its share of any allocated expenses from NGP Management, expenses associated with the compensatory elements of the transaction, and the amortization of the basis differences related to the definitive-lived identifiable intangible assets of NGP Management. The net investment earnings (loss) recognized in the Partnership’s condensed consolidated statements of operations for the three months ended March 31, 2015 and 2014 were as follows:

	Three Months Ended March 31,
	2015			2014
	(Dollars in millions)
Management fees	$	14.3		$	14.4
Performance fees	(14.5		)	—
Investment income (loss)	(0.2		)	—
Expenses and amortization of basis differences	(18.1		)	(18.7		)
Net investment income (loss)	$	(18.5	)	$	(4.3	)

The difference between the Partnership’s carrying value of its investment and its share of the underlying net assets of the investee was $127.4 million and $141.6 million as of March 31, 2015 and December 31, 2014, respectively; these differences are amortized over a period of 10 years from the initial investment date.

Equity-Method Investments

The Partnership’s equity method investments include its fund investments in Corporate Private Equity, Global Market Strategies and Real Assets, typically as general partner interests, and its investment in NGP Management (included within Real Assets), which are not consolidated. Investments are related to the following segments:

	As of
	March 31, 2015		December 31, 2014
	(Dollars in millions)
Corporate Private Equity	$	251.3	$	246.3
Global Market Strategies	25.3		25.3
Real Assets	640.6		647.1
Total	$	917.2	$	918.7

The Partnership evaluates each of its equity method investments to determine if disclosure of summarized income statement information is required under Article 10 of Regulation S-X. As of March 31, 2015 and for the three months then ended, no individual equity method investment held by the Partnership met the threshold for disclosure of summarized income statement information.

Investment Income (Loss)

The components of investment income (loss) are as follows:

	Three Months Ended March 31,
	2015			2014
	(Dollars in millions)
Income from equity investments	$	8.8		$	4.0
Income (loss) from trading securities	(2.6		)	1.9
Other investment income	0.6			0.2
Total	$	6.8		$	6.1

Carlyle’s income (loss) from its equity-method investments is included in investment income (loss) in the condensed consolidated statements of operations and consists of:

	Three Months Ended March 31,
	2015			2014
	(Dollars in millions)
Corporate Private Equity	$	23.8		$	17.0
Global Market Strategies	0.7			—
Real Assets	(15.7		)	(13.0		)
Total	$	8.8		$	4.0

Trading Securities and Other Investments

Trading securities and other investments as of March 31, 2015 and December 31, 2014 primarily consisted of $27.0 million and $12.9 million, respectively, of investments in derivative instruments and corporate mezzanine securities and bonds, as well as other cost method investments.

Investments of Consolidated Funds

During the three months ended March 31, 2015, the Partnership formed two new CLOs. The Partnership has concluded that these CLOs are VIEs and the Partnership is the primary beneficiary. As a result, the Partnership consolidated the financial positions and results of operations of these CLOs into its condensed consolidated financial statements beginning on their respective closing dates. As of March 31, 2015, the total assets of these CLOs included in the Partnership’s condensed consolidated financial statements were approximately $1.8 billion.

There were no individual investments with a fair value greater than five percent of the Partnership’s total assets for any period presented.

Interest and Other Income of Consolidated Funds

The components of interest and other income of Consolidated Funds are as follows:

	Three Months Ended March 31,
	2015		2014
	(Dollars in millions)
Interest income from investments	$	208.4	$	221.2
Other income	17.9		29.5
Total	$	226.3	$	250.7

Net Investment Gains (Losses) of Consolidated Funds

Net investment gains (losses) of Consolidated Funds include net realized gains (losses) from sales of investments and unrealized gains (losses) resulting from changes in fair value of the Consolidated Funds’ investments. The components of net investment gains (losses) of Consolidated Funds are as follows:

	Three Months Ended March 31,
	2015			2014
	(Dollars in millions)
Gains from investments of Consolidated Funds	$	560.5		$	488.9
Losses from liabilities of CLOs	(55.5		)	(65.1		)
Gains on other assets of CLOs	0.5			0.2
Total	$	505.5		$	424.0

The following table presents realized and unrealized gains (losses) earned from investments of the Consolidated Funds:

	Three Months Ended March 31,
	2015		2014
	(Dollars in millions)
Realized gains	$	224.6	$	732.3
Net change in unrealized gains (losses)	335.9		(243.4		)
Total	$	560.5	$	488.9

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Intangible Assets and Goodwill

3 Months Ended

Mar. 31, 2015

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible Assets and Goodwill

Intangible Assets and Goodwill

The following table summarizes the carrying amount of intangible assets as of March 31, 2015 and December 31, 2014:

	As of
	March 31, 2015			December 31, 2014
	(Dollars in millions)
Acquired contractual rights	$	832.1		$	843.0
Acquired trademarks	6.6			6.7
Accumulated amortization	(485.2		)	(455.1		)
Finite-lived intangible assets, net	353.5			394.6
Goodwill	45.8			47.5
Intangible assets, net	$	399.3		$	442.1

The following table summarizes the changes in the carrying amount of goodwill by segment as of March 31, 2015. There was no goodwill associated with the Partnership’s Corporate Private Equity and Real Assets segments.

	Global Market Strategies		Investment Solutions			Total
	(Dollars in millions)
Balance as of December 31, 2014	$	28.0	$	19.5		$	47.5
Foreign currency translation	—		(1.7		)	(1.7		)
Balance as of March 31, 2015	$	28.0	$	17.8		$	45.8

During the three months ended March 31, 2015 and 2014, the Partnership evaluated for impairment certain intangible assets associated with acquired contractual rights for fee income based on revisions to the related expected future cash flow. The intangible assets are included in the Global Market Strategies segment. The Partnership recorded an impairment loss of $11.8 million and $24.6 million during the three months ended March 31, 2015 and 2014, respectively, to reduce the carrying value of the intangible assets to their estimated fair value. Fair value was based on a probability-weighted discounted cash flow model. This fair value measurement was based on significant inputs not observable in the market and thus represented a Level III measurement as defined in the accounting guidance for fair value measurements. The impairment loss was included in general, administrative and other expenses in the accompanying condensed consolidated financial statements.

Intangible asset amortization expense, excluding impairment losses, was $22.4 million and $27.5 million for the three months ended March 31, 2015 and 2014, respectively, and is included in general, administrative, and other expenses in the condensed consolidated statements of operations.

The following table summarizes the expected amortization expense for April 1, 2015 through 2019 and thereafter (Dollars in millions):

2015	$	61.0
2016	68.7
2017	65.6
2018	58.5
2019	48.4
Thereafter	51.3
	$	353.5

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Contingent Consideration

3 Months Ended

Mar. 31, 2015

Business Combinations [Abstract]

Contingent Consideration

Contingent Consideration

The Partnership has contingent consideration obligations related to its business acquisitions and strategic investments. The changes in the contingent consideration liabilities are as follows:

	Rollforward For The Three Months Ended March 31, 2015
	Amounts payable to the sellers who are Carlyle professionals
	Performance-based contingent cash consideration			Performance-based contingent equity consideration		Employment-based contingent consideration			Contingent cash and other consideration payable to non- Carlyle personnel				Total
	(Dollars in millions)
Balance at December 31, 2014	$	26.8		$	—	$	156.8		$	201.0			$	384.6
Change in carrying value	0.7			—		(9.5		)	25.6			(a)	16.8
Payments	—			—		(3.3		)	(0.5		)		(3.8		)
Issuances of equity	—			—		(2.2		)	—				(2.2		)
Balance at March 31, 2015	$	27.5		$	—	$	141.8		$	226.1			$	395.4
	Rollforward For The Three Months Ended March 31, 2014
	Amounts payable to the sellers who are senior Carlyle professionals												Total
	Performance-based contingent cash consideration			Performance-based contingent equity consideration		Employment-based contingent consideration			Contingent cash and other consideration payable to non- Carlyle personnel
	(Dollars in millions)
Balance at December 31, 2013	$	145.1		$	15.7	$	148.7		$	40.8			$	350.3
Change in carrying value	17.0			10.6		13.1			5.2				45.9
Payments	(70.5		)	—		—			(2.2		)		(72.7		)
Balance at March 31, 2014	$	91.6		$	26.3	$	161.8		$	43.8			$	323.5

(a) - Refer to Note 6 for information on the contingent consideration payable to BNRI from the strategic investment in NGP.

The fair value of the performance-based contingent cash and equity consideration payable to the sellers who are Carlyle professionals has been recorded in due to affiliates in the accompanying condensed consolidated balance sheets. These payments are not contingent upon the Carlyle professional being employed by Carlyle at the time that the performance conditions are met. Changes in the fair value of these amounts are recorded in other non-operating (income) expenses in the condensed consolidated statements of operations. The portion of the contingent consideration payment attributable to the initial amount recorded as part of the consideration transferred is classified as cash flows from financing activities. The portion of the contingent consideration payment that is attributable to the subsequent changes in the fair value of the contingent consideration is classified as cash flows from operating activities in the condensed consolidated statements of cash flows.

The amount of employment-based contingent cash consideration payable to the sellers who are Carlyle professionals has been recorded as accrued compensation and benefits in the accompanying condensed consolidated balance sheets. Changes in the value of these amounts are recorded as compensation expense in the condensed consolidated statements of operations.

The fair value of contingent consideration payable to non-Carlyle personnel is included in accounts payable, accrued expenses and other liabilities, or due to affiliates for amounts payable to NGP, in the accompanying condensed consolidated balance sheets. Changes in the fair value of this contingent consideration are recorded in other non-operating (income) expenses, or investment income in the case of amounts payable to NGP, in the condensed consolidated statements of operations. Included in the change in carrying value for the three months ended March 31, 2015 is $23.2 million related to the accrual of additional contingent consideration payable to BNRI (See Note 6). This amount was capitalized into the carrying value of the Partnership's equity method investment in NGP.

The fair values of the performance-based contingent cash consideration for business acquisitions were based on probability-weighted discounted cash flow models. These fair value measurements are based on significant inputs not observable in the market and thus represent Level III measurements as defined in the accounting guidance for fair value measurement. Refer to Note 4 for additional disclosures related to the fair value of these instruments as of March 31, 2015 and December 31, 2014.

The following table represents the maximum amounts that could be paid from contingent cash obligations associated with the business acquisitions and the strategic investment in NGP Management: 

	As of March 31, 2015
	Business Acquisitions		NGP Investment		Total		Liability Recognized on Financial Statements (1)
			(Dollars in millions)
Performance-based contingent cash consideration	$	231.8	$	183.0	$	414.8	$	253.6
Employment-based contingent cash consideration	255.0		45.0		300.0		141.8
Total maximum cash obligations	$	486.8	$	228.0	$	714.8	$	395.4

(1) On the condensed consolidated balance sheet, the liability for performance-based contingent cash consideration is included in due to affiliates (for amounts owed to Carlyle professionals and NGP) and accounts payable, accrued expenses, and other liabilities (for amounts owed to other sellers), and the liability for employment-based contingent cash consideration is included in accrued compensation and benefits.

Some of the employment-based contingent cash consideration agreements do not contain provisions limiting the amount that could be paid by the Partnership. For purposes of the table above, the Partnership has used its current estimate of the amount to be paid upon the determination dates for such payments. In the consolidated financial statements, the Partnership records the performance-based contingent cash consideration from business acquisitions at fair value at each reporting period. For the employment-based contingent cash consideration, the Partnership accrues the compensation liability over the implied service period.