10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended March 31, 2021

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: 001-36418

Moelis & Company

(Exact name of registrant as specified in its charter)

Delaware	46-4500216
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
399 Park Avenue, 5th Floor, New York NY	10022
(Address of principal executive offices)	(Zip Code)

(212) 883-3800

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title	Trading Symbol	Name of Exchange on which registered
Class A Common Stock	MC	New York Stock Exchange (NYSE)

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 and 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  ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 such files). ☒ Yes ☐ No

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

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act  ☐

Indicate by check mark whether the registrant is a shell company (as defined in rule 12b-2 of the Exchange Act). ☐ Yes ☒ No

As of April 15, 2021, there were 61,325,544 shares of Class A common stock, par value $0.01 per share, and 4,899,457 shares of Class B common stock, par value $0.01 per share, outstanding.

TABLE OF CONTENTS

		Page
Part I. Financial Information
Item 1.	Financial Statements	3
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	24
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	32
Item 4.	Controls and Procedures	32
Part II. Other Information
Item 1.	Legal Proceedings	33
Item 1A.	Risk Factors	33
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	33
Item 3.	Defaults Upon Senior Securities	33
Item 4.	Mine Safety Disclosures	33
Item 5.	Other Information	33
Item 6.	Exhibits	34
Signatures		35

2

PART I. FINANCIAL INFORMATION

Item 1.  Financial Statements

Condensed Consolidated Financial Statements (Unaudited)

	Page
Condensed Consolidated Statements of Financial Condition as of March 31, 2021 and December 31, 2020	4
Condensed Consolidated Statements of Operations for the three months ended March 31, 2021 and 2020	5
Condensed Consolidated Statements of Comprehensive Income for the three months ended March 31, 2021 and 2020	6
Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2021 and 2020	7
Condensed Consolidated Statements of Changes in Equity for the three months ended March 31, 2021 and 2020	8
Notes to Condensed Consolidated Financial Statements	9

3

Moelis & Company

Condensed Consolidated Statements of Financial Condition

(Unaudited)

(dollars in thousands, except per share amounts)

	March 31,			December 31,
	2021			2020
Assets
Cash and cash equivalents	$	155,402		$	202,477
Restricted cash		1,081			807
Receivables:
Accounts receivable, net of allowance for credit losses of $6,183 and $3,775 as of March 31, 2021 and December 31, 2020, respectively		71,824			89,297
Accrued and other receivables		45,427			11,916
Total receivables		117,251			101,213
Deferred compensation		15,676			12,004
Investments		118,427			211,826
Right-of-use assets		171,857			177,069
Equipment and leasehold improvements, net		52,067			49,977
Deferred tax assets		423,281			424,345
Prepaid expenses and other assets		16,055			16,726
Total assets	$	1,071,097		$	1,196,444
Liabilities and Equity
Compensation payable	$	59,889		$	220,058
Accounts payable, accrued expenses and other liabilities		24,583			25,026
Amount due pursuant to tax receivable agreement		324,064			307,581
Deferred revenue		8,105			2,692
Lease liabilities		193,876			196,614
Total liabilities		610,517			751,971
Commitments and Contingencies (See Note 11)
Class A common stock, par value $0.01 per share (1,000,000,000 shares authorized, 66,648,561 issued and 61,325,544 outstanding at March 31, 2021; 1,000,000,000 authorized, 61,986,927 issued and 58,027,844 outstanding at December 31, 2020)		666			620
Class B common stock, par value $0.01 per share (1,000,000,000 shares authorized, 4,899,457 issued and outstanding at March 31, 2021; 1,000,000,000 authorized, 5,948,750 issued and outstanding at December 31, 2020)		49			59
Treasury stock, at cost; 5,323,017 and 3,959,083 shares as of March 31, 2021 and December 31, 2020, respectively		(226,381	)		(152,170	)
Additional paid-in-capital		1,101,205			1,052,322
Retained earnings (accumulated deficit)		(393,166	)		(420,682	)
Accumulated other comprehensive income (loss)		(856	)		(201	)
Total Moelis & Company equity		481,517			479,948
Noncontrolling interests		(20,937	)		(35,475	)
Total equity		460,580			444,473
Total liabilities and equity	$	1,071,097		$	1,196,444

See notes to the condensed consolidated financial statements (unaudited).

4

Moelis & Company

Condensed Consolidated Statements of Operations

(Unaudited)

(dollars in thousands, except per share amounts)

	Three Months Ended March 31,
	2021			2020
Revenues	$	263,866		$	153,706
Expenses
Compensation and benefits		156,499			95,120
Occupancy		7,695			7,231
Professional fees		5,999			4,236
Communication, technology and information services		8,659			8,392
Travel and related expenses		1,610			7,944
Depreciation and amortization		1,449			1,199
Other expenses		9,512			5,142
Total expenses		191,423			129,264
Operating income (loss)		72,443			24,442
Other income and (expenses)		3,179			(1,660	)
Income (loss) before income taxes		75,622			22,782
Provision (benefit) for income taxes		(176	)		(7,344	)
Net income (loss)		75,798			30,126
Net income (loss) attributable to noncontrolling interests		9,269			4,996
Net income (loss) attributable to Moelis & Company	$	66,529		$	25,130
Weighted-average shares of Class A common stock outstanding
Basic		60,932,966			52,666,457
Diluted		66,360,217			57,092,982
Net income (loss) per share attributable to holders of shares of Class A common stock
Basic	$	1.09		$	0.48
Diluted	$	1.00		$	0.44

See notes to the condensed consolidated financial statements (unaudited).

5

Moelis & Company

Condensed Consolidated Statements of Comprehensive Income

(Unaudited)

(dollars in thousands)

	Three Months Ended March 31,
	2021			2020
Net income (loss)	$	75,798		$	30,126
Foreign currency translation adjustment, net of tax		(744	)		(1,630	)
Other comprehensive income (loss)		(744	)		(1,630	)
Comprehensive income (loss)		75,054			28,496
Less: Comprehensive income (loss) attributable to noncontrolling interests		9,180			4,670
Comprehensive income (loss) attributable to Moelis & Company	$	65,874		$	23,826

See notes to the condensed consolidated financial statements (unaudited).

6

Moelis & Company

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(dollars in thousands)

	Three Months Ended March 31,
	2021			2020
Cash flows from operating activities
Net income (loss)	$	75,798		$	30,126
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Bad debt expense		3,149			518
Depreciation and amortization		1,449			1,199
Equity-based compensation		50,963			38,255
Deferred tax provision		21,245			(6,723	)
Other		(2,615	)		2,099
Changes in assets and liabilities:
Accounts receivable		14,401			5,565
Accrued and other receivables		(32,589	)		(1,899	)
Prepaid expenses and other assets		(587	)		117
Deferred compensation		(3,660	)		(4,925	)
Compensation payable		(160,178	)		(150,260	)
Accounts payable, accrued expenses and other liabilities		1,969			9,454
Deferred revenue		5,409			1,439
Dividends received		2,279			1,942
Net cash provided by (used in) operating activities		(22,967	)		(73,093	)
Cash flows from investing activities
Purchase of investments		(78,723	)		(28,152	)
Proceeds from sales of investments		173,046			181,249
Note payments received from employees		70			—
Purchase of equipment and leasehold improvements		(3,539	)		(13,139	)
Net cash provided by (used in) investing activities		90,854			139,958
Cash flows from financing activities
Dividends and distributions		(39,685	)		(88,689	)
Proceeds from exercise of stock options		—			11,819
Treasury stock purchases		(74,211	)		(31,636	)
Net cash provided by (used in) financing activities		(113,896	)		(108,506	)
Effect of exchange rate fluctuations on cash, cash equivalents, and restricted cash		(792	)		(2,176	)
Net increase (decrease) in cash, cash equivalents, and restricted cash		(46,801	)		(43,817	)
Cash, cash equivalents, and restricted cash, beginning of period		203,284			168,572
Cash, cash equivalents, and restricted cash, end of period	$	156,483		$	124,755
Supplemental cash flow disclosure:
Cash paid during the period for:
Income taxes	$	1,913		$	1,560
Other non-cash activity
Cumulative effect adjustment upon adoption of ASU 2016-13	$	—		$	364
Dividend equivalents issued	$	5,131		$	12,125
Class A Partnership Units or other equity converted into Class A Common Stock	$	3,903		$	786
Forfeiture of fully-vested Group LP units or other equity units	$	25		$	96

See notes to the condensed consolidated financial statements (unaudited).

7

Moelis & Company

Condensed Consolidated Statements of Changes in Equity

(Unaudited)

(dollars in thousands, except share amounts)

	Shares																			Retained			Accumulated
	Class A		Class B						Class A		Class B						Additional			Earnings			Other
	Common		Common			Treasury			Common		Common			Treasury			Paid-In			(Accumulated			Comprehensive			Noncontrolling			Total
	Stock		Stock			Stock			Stock		Stock			Stock			Capital			Deficit)			Income (Loss)			Interests			Equity
Balance as of January 1, 2021		61,986,927		5,948,750			(3,959,083	)	$	620	$	59		$	(152,170	)	$	1,052,322		$	(420,682	)	$	(201	)	$	(35,475	)	$	444,473
Net income (loss)		—		—			—			—		—			—			—			66,529			—			9,269			75,798
Equity-based compensation		3,612,341		—			—			36		—			—			41,508			—			—			9,419			50,963
Other comprehensive income (loss)		—		—			—			—		—			—			—			—			(655	)		(89	)		(744	)
Dividends declared ($0.55 per share of Class A common stock) and tax distributions		—		—			—			—		—			—			5,131			(39,013	)		—			(5,803	)		(39,685	)
Treasury Stock Purchases		—		—			(1,363,934	)		—		—			(74,211	)		—			—			—			—			(74,211	)
Equity-based payments to non-employees		—		—			—			—		—			—			108			—			—			—			108
Issuance of Class A common stock and cancellation of Class B common stock in connection with offerings and other exchanges		1,049,293		(1,049,293	)		—			10		(10	)		—			2,161			—			—			1,742			3,903
Other		—		—			—			—		—			—			(25	)		—			—			—			(25	)
Balance as of March 31, 2021		66,648,561		4,899,457			(5,323,017	)	$	666	$	49		$	(226,381	)	$	1,101,205		$	(393,166	)	$	(856	)	$	(20,937	)	$	460,580

	Shares																	Retained			Accumulated
	Class A		Class B					Class A		Class B					Additional			Earnings			Other
	Common		Common		Treasury			Common		Common		Treasury			Paid-In			(Accumulated			Comprehensive			Noncontrolling			Total
	Stock		Stock		Stock			Stock		Stock		Stock			Capital			Deficit)			Income (Loss)			Interests			Equity
Balance as of January 1, 2020		52,773,617		10,397,915		(2,757,558	)	$	528	$	104	$	(107,836	)	$	872,791		$	(324,192	)	$	1,432		$	(49,000	)	$	393,827
Cumulative effect adjustment upon adoption of ASU 2016-13		—		—		—			—		—		—			—			(364	)		—			—			(364	)
Balance as of January 1, 2020, as adjusted		52,773,617		10,397,915		(2,757,558	)		528		104		(107,836	)		872,791			(324,556	)		1,432			(49,000	)		393,463
Net income (loss)		—		—		—			—		—		—			—			25,130			—			4,996			30,126
Equity-based compensation		3,581,294		—		—			36		—		—			38,189			—			—			30			38,255
Other comprehensive income (loss)		—		—		—			—		—		—			—			—			(1,304	)		(326	)		(1,630	)
Dividends declared ($1.26 per share of Class A common stock) and tax distributions		—		—		—			—		—		—			12,125			(79,391	)		—			(21,423	)		(88,689	)
Treasury Stock Purchases		—		—		(869,779	)		—		—		(31,636	)		—			—			—			—			(31,636	)
Exercise of Stock options		721,484		—		—			7		—		—			11,812			—			—			—			11,819
Equity-based payments to non-employees		—		—		—			—		—		—			158			—			—			—			158
Other		—		—		—			—		—		—			(1,981	)		—			—			2,671			690
Balance as of March 31, 2020		57,076,395		10,397,915		(3,627,337	)	$	571	$	104	$	(139,472	)	$	933,094		$	(378,817	)	$	128		$	(63,052	)	$	352,556

See notes to the condensed consolidated financial statements (unaudited).

8

1. ORGANIZATION AND BASIS OF PRESENTATION

Moelis & Company and its consolidated subsidiaries (the “Company,” “we,” “our,” or “us”) is a leading global investment bank, incorporated in Delaware. Prior to the Company’s Initial Public Offering (“IPO”), the business operated as a Delaware limited partnership that commenced operations during 2007. Following the IPO, the operations are owned by Moelis & Company Group LP (“Group LP”), a U.S. Delaware limited partnership, and Group LP is controlled by Moelis & Company. Moelis & Company’s shareholders are entitled to receive a portion of Group LP’s economics through their direct ownership interests in shares of Class A common stock of Moelis & Company. The noncontrolling interest owners of Group LP (not Moelis & Company) receive economics of the operations primarily through their ownership interests in Group LP partnership units.

The Company’s activities as an investment banking advisory firm constitute a single business segment offering clients, including corporations, governments and financial sponsors, a range of advisory services with expertise across all major industries in mergers and acquisitions, recapitalizations and restructurings and other corporate finance matters.

Basis of Presentation —The condensed consolidated financial statements of Moelis & Company include its partnership interests in Group LP, its equity interest in the sole general partner of Group LP, Moelis & Company Group GP LLC (“Group GP”), and its interests in its subsidiaries. Moelis & Company will operate and control all of the business and affairs of Group LP and its operating entity subsidiaries indirectly through its equity interest in Group GP. The Company operates through the following subsidiaries:

• Moelis & Company LLC (“Moelis U.S.”), a Delaware limited liability company, a registered broker-dealer with the U.S. Securities and Exchange Commission (“SEC”) and a member of the Financial Industry Regulatory Authority, Inc. (“FINRA”).

• Moelis & Company Israel Ltd., a limited company incorporated in Israel.

• Moelis & Company International Holdings LLC (“Moelis International”), a Delaware limited liability company, owns the following entities and investments, directly or indirectly:

• Moelis & Company UK LLP (“Moelis UK”), a limited liability partnership registered under the laws of England and Wales. In addition to the United Kingdom, Moelis UK maintains operations through the following branches:

• Moelis & Company Europe Limited, Frankfurt am Main Branch (German branch)

• Moelis & Company UK LLP, DIFC Branch (Dubai branch)

• Moelis & Company Asia Limited (“Moelis Asia”), a limited company incorporated in Hong Kong licensed under the Hong Kong Securities and Futures Ordinance to provide financial advisory services. In addition to Hong Kong, Moelis Asia maintains operations in Beijing, China through a wholly-owned Chinese subsidiary, Moelis & Company Consulting (Beijing) Company Limited.

• Moelis & Company Netherlands BV, a private limited company incorporated in Amsterdam, Netherlands. In addition to Amsterdam, Moelis Netherlands maintains operations in Paris, France through a wholly owned subsidiary, Moelis & Company Netherlands B.V. French Branch

• Moelis & Company India Private Limited, a private limited company incorporated in Mumbai, India.

• Moelis & Company Assessoria Financeira Ltda. (“Moelis Brazil”), a limited liability company incorporated in São Paulo, Brazil.

• An equity method investment in Moelis Australia Limited (“Moelis Australia”), a public company listed on the Australian Securities Exchange

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Accounting —The Company prepared the accompanying condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). As permitted by the interim reporting rules and regulations set forth by the SEC, the condensed consolidated financial statements presented exclude certain financial information and footnote disclosures normally included in audited financial statements prepared in accordance with U.S. GAAP. In the opinion of the Company’s management, the accompanying unaudited condensed consolidated financial statements contain all adjustments, consisting of normal recurring adjustments, necessary to fairly present the accompanying unaudited condensed consolidated financial statements. These unaudited condensed

9

consolidated financial statements should be read in conjunction with the consolidated audited financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2020.

Consolidation —The Company’s policy is to consolidate (i) entities in which it has a controlling financial interest, (ii) variable interest entities where the Company has a variable interest and is deemed to be the primary beneficiary and (iii) limited partnerships where the Company has ownership of the majority of voting interests. When the Company does not have a controlling interest in an entity, but exerts significant influence over the entity’s operating and financial decisions, the Company applies the equity method of accounting in which it records in earnings its share of income or losses of the entity. All intercompany balances and transactions with the Company’s subsidiaries have been eliminated in consolidation.

Use of Estimates —The preparation of condensed consolidated financial statements and related disclosures in conformity with U.S. GAAP requires management to make estimates and assumptions 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. Actual results could differ from those estimates. Estimates and assumptions are reviewed periodically, and the effects of revisions are reflected in the period in which they are determined to be necessary.

In preparing the condensed consolidated financial statements, management makes estimates and assumptions regarding:

• the adequacy of the allowance for credit losses;

• the assessment of whether revenues from variable consideration should be constrained due to the probability of a significant revenue reversal;

• the assessment of probable lease terms and the measurement of the present value of such obligations;

• the measurement and realization of deferred taxes;

• the measurement of amount due pursuant to tax receivable agreement; and

• other matters that affect the reported amounts and disclosures of contingencies in the financial statements.

Cash, Cash Equivalents and Restricted Cash —Cash and cash equivalents include all short-term highly liquid investments that are readily convertible to known amounts of cash and have original maturities of three months or less from the date of purchase.

The Company’s cash is maintained in U.S. and non-U.S. bank accounts, of which most bank account balances had little or no insurance coverage (most balances are held in U.S. and U.K. accounts which exceeded the U.S. Federal Deposit Insurance Corporation and U.K. Financial Services Compensation Scheme coverage limits). The Company’s cash equivalents are invested primarily in U.S. Treasury instruments and money market securities.

The Company’s restricted cash is comprised of collateral deposits primarily held by certain non-U.S. subsidiaries. These deposits are required for certain direct debit accounts and are also used to satisfy future medical claims. A reconciliation of the Company’s cash, cash equivalents and restricted cash as of March 31, 2021 and 2020, is presented below.

	March 31,
	2021		2020
Cash	$	97,899	$	38,975
Cash equivalents		57,503		85,183
Restricted cash		1,081		597
Total cash, cash equivalents, and restricted cash shown in the statement of cash flows	$	156,483	$	124,755

Additionally, as of December 31, 2020, the Company held cash of $83,472 and cash equivalents of $119,005.

Receivables —The accompanying condensed consolidated statements of financial condition present accounts receivable balances net of allowance for credit losses based on the Company’s assessment of the collectability of customer accounts.

Included in the accounts receivable balances at March 31, 2021 and December 31, 2020 were $21,774 and $19,603 of long term receivables related to private funds advisory capital raising engagements, which are generally paid in installments over a period of three to four years. These long term receivables generated interest income of $204 and $188 for the three months ended March 31, 2021 and 2020, respectively.

10

The Company maintains an allowance for credit losses that, in management’s opinion, provides for an adequate reserve to cover losses that may be incurred. For purposes of determining appropriate allowances, the Company stratifies its population of accounts receivable into two categories, one for short-term receivables and a second for private funds advisory receivables. Each population is separately evaluated using an aging method that results in a percentage reserve based on the age of the receivable, in addition to considerations of historical charge-offs and current economic conditions.

After concluding that a reserved accounts receivable is no longer collectible, the Company will charge-off the receivable. This has the effect of reducing both the gross receivable and the allowance for credit losses. If a reserved accounts receivable is subsequently collected, such recoveries reduce the gross receivable and the allowance for credit losses and is a reduction of bad debt expense, which is recorded within other expenses on the condensed consolidated statement of operations. The combination of recoveries and the provision for credit losses of a reported period comprise the Company’s bad debt expense.

On January 1, 2020, the Company adopted Accounting Standards Update No. 2016-13— “Measurement of Credit Losses on Financial Instruments" ("ASU 2016-13") using the modified retrospective method. Upon adoption, a cumulative adjustment was recorded which decreased retained earnings by $459. The tax effect of this adjustment increased retained earnings by $95, resulting in a net decrease of $364 as of January 1, 2020. ASU 2016-13 replaces the incurred loss impairment methodology for financial instruments with the current expected credit loss (CECL) model which requires estimates of future credit losses based on reasonable supporting information. The Company will recognize its expected credit losses for each reporting period going forward.

The following tables summarize credit loss allowance activity for the three months ended March 31, 2021 and March 31, 2020:

	Three Months Ended March 31, 2021
	Accounts Receivable
		Short-term Receivables				Private Funds Advisory Receivables			Total
Allowance for Credit Losses, beginning balance	$		3,577		$		198	$		3,775
Charge-offs			(741	)			—			(741	)
Recoveries			(1,126	)			—			(1,126	)
Reduction to allowance			(1,867	)			—			(1,867	)
Provision for credit losses			4,253				22			4,275
Allowance for credit losses, ending balance	$		5,963		$		220	$		6,183

	Three Months Ended March 31, 2020
	Accounts Receivable
		Short-term Receivables				Private Funds Advisory Receivables				Total
Allowance for Credit Losses, beginning balance	$		4,088		$		—		$		4,088
Adjustment for adoption of ASU 2016-13			260				199				459
Allowance for Credit Losses, adjusted beginning balance			4,348				199				4,547
Charge-offs			(1,289	)			—				(1,289	)
Recoveries			(724	)			(26	)			(750	)
Reduction to allowance			(2,013	)			(26	)			(2,039	)
Provision for credit losses			1,216				52				1,268
Allowance for credit losses, ending balance	$		3,551		$		225		$		3,776

Deferred Compensation —Deferred compensation costs represent arrangements with certain employees whereby cash payments are subject to a required period of service subsequent to payment by the Company. These amounts are charged to expenses over the period that the employee is required to provide services in order to vest in the payment.

Financial Instruments at Fair Value —Fair value is generally based on quoted prices, however if quoted market prices are not available, fair value is determined based on other relevant factors, including dealer price quotations, price activity for equivalent instruments and valuation pricing models. The Company established a fair value hierarchy which prioritizes and ranks the level of market price observability used in measuring financial instruments at fair value. Market price observability is affected by a number of factors, including the type of instrument, the characteristics specific to the instrument and the state of the marketplace (including the existence and transparency of transactions between market participants). Financial instruments with readily-available actively quoted prices or for which fair value can be measured from actively-quoted prices in an orderly market will generally have a higher degree of market price observability and a lesser degree of judgment used in measuring fair value.

11

Financial instruments measured and reported at fair value are classified and disclosed in one of the following categories (from highest to lowest level of observability) based on inputs:

Level 1 —Quoted prices (unadjusted) are available in active markets for identical instruments that the Company has the ability to access as of the reporting date. The Company, to the extent that it holds such instruments, does not adjust the quoted price for these instruments, even in situations in which the Company holds a large position and a sale could reasonably affect the quoted price.

Level 2 —Pricing inputs are observable for the instruments, either directly or indirectly, as of the reporting date, but are not the same as those used in Level 1. Fair value is determined through the use of models or other valuation methodologies.

Level 3 —Pricing inputs are unobservable for the instruments and include situations where there is little, if any, market activity for the investments. The inputs into the determination of fair value require significant judgment or estimation by the Company’s management.

For level 3 investments in which pricing inputs are unobservable and limited market activity exists, management’s determination of fair value is based on the best information available, may incorporate management’s own assumptions and involves a significant degree of judgment. 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 investment is based on the lowest level of input that is significant to the fair value measurement. The Company’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 instrument.

Equity Method Investments —The Company accounts for its equity method investments under the equity method of accounting as the Company does not control these entities but has the ability to exercise significant influence. The amounts recorded in investments on the condensed consolidated statements of financial condition reflect the Company’s share of contributions made to, distributions received from, and the equity earnings and losses of, the investments. The Company reflects its share of gains and losses of the investment in other income and expenses in the condensed consolidated statements of operations using the most recently available earnings data at the end of the period.

Leases — The Company maintains operating leases for corporate offices and an aircraft. The Company determines if a contract contains a lease at inception. Operating leases are recorded as right-of-use (“ROU”) assets and lease liabilities on the condensed consolidated statements of financial condition. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease liabilities are recognized at the lease commencement date and are measured at the present value of anticipated lease payments over the lease term. The operating lease ROU assets are equal to the lease liabilities, adjusted for certain lease incentives, accrued rents, and prepaid rents. Typically, our borrowing rate is used to determine the present value of lease payments because the implicit rate is not readily determinable. Our lease terms may include options to extend or terminate the lease. These options are factored into our present value calculations when it is reasonably certain that such options will be exercised. Operating lease expense is recognized on a straight-line basis over the lease term.

Software— Costs related to implementation of cloud computing arrangements that qualify for capitalization are stated at cost less accumulated amortization within prepaid and other assets on the Company’s condensed consolidated statement of financial condition. Such capitalized costs are amortized using the straight-line method over the term of the cloud computing service contract or another rational basis, beginning when the cloud computing arrangement is substantially complete and ready for its intended use. All costs not directly related to the implementation of cloud computing arrangements, including overhead costs and costs of service agreements, will be expensed in the period they are incurred. The amortization expense of such capitalized costs will be presented under communication, technology and information services on the condensed consolidated statement of operations.

Effective January 1, 2020, the Company adopted ASU 2018-15, “Goodwill and Other —Internal Use Software” using a prospective approach (“ASU 2018-15”). ASU 2018-15 aligns the requirements for capitalizing implementation costs incurred in cloud computing arrangements with the requirements for capitalizing costs to develop or obtain internal-use software. See Note 4—Fixed and Intangible Assets below for further details on the Company’s capitalized cloud computing arrangements.

Equipment and Leasehold Improvements —Office equipment and furniture and fixtures are stated at cost less accumulated depreciation, which is determined using the straight-line method over the estimated useful lives of the assets, ranging from three to seven years, respectively. Leasehold improvements are stated at cost less accumulated amortization, which is determined using the straight-line method over the lesser of the term of the lease or the estimated useful life of the asset.

Major renewals and improvements are capitalized and minor replacements, maintenance and repairs are charged to expenses as incurred. Assets that are in development and have not yet been placed in service are generally classified as “Construction in Progress” and are reclassified to the appropriate category when the associated assets are placed in service. Upon retirement or disposal of assets, the cost and related accumulated depreciation or amortization are removed from the condensed consolidated statements of financial condition and any gain or loss is reflected in the condensed consolidated statements of operations.

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Deferred Tax Asset and Amount Due Pursuant to Tax Receivable Agreement —In conjunction with the IPO, the Company was  treated for U.S. federal income tax purposes as having directly purchased Class A partnership units in Group LP from the existing unitholders. Additional Group LP Class A partnership units may be exchanged for shares of Class A common stock in the Company. The initial purchase and future exchanges are expected to result in an increase in the tax basis of Group LP’s assets attributable to the Company’s interest in Group LP. These increases in the tax basis of Group LP’s assets attributable to the Company’s interest in Group LP would not have been available but for the initial purchase and future exchanges. Such increases in tax basis are likely to increase (for tax purposes) depreciation and amortization deductions and therefore reduce the amount of income tax the Company would otherwise be required to pay in the future. As a result, the Company records a deferred tax asset for such increase in tax basis.

The Company has entered into a tax receivable agreement with its eligible Managing Directors that will provide for the payment by the Company to its eligible Managing Directors of 85% of the amount of cash savings, if any, in U.S. federal, state, and local income tax or franchise tax that the Company actually realizes as a result of (a) the increases in tax basis attributable to exchanges by its eligible Managing Directors and (b) tax benefits related to imputed interest deemed to be paid by the Company as a result of this tax receivable agreement. The Company expects to benefit from the remaining 15% of cash savings, if any, in income tax that it realizes and record any such estimated tax benefits as an increase to additional paid-in-capital. For purposes of the tax receivable agreement, cash savings in income tax will be computed by comparing the Company’s actual income tax liability to the amount of such taxes that it would have been required to pay had there been no increase to the tax basis of the tangible and intangible assets of Group LP as a result of the exchanges and had it not entered into the tax receivable agreement. The term of the tax receivable agreement commenced upon consummation of the IPO and will continue until all such tax benefits have been utilized or expired, unless the Company exercises its right to terminate the tax receivable agreement for an amount based on an agreed value of payments remaining to be made under the agreement. The Company has recorded the estimated tax benefits related to the increase in tax basis and imputed interest as a result of the initial purchase and subsequent exchanges described above as a deferred tax asset in the condensed consolidated statements of financial condition. The amount due to its eligible Managing Directors related to the tax receivable agreement as a result of the initial purchase and subsequent exchanges described above is recorded as amount due pursuant to tax receivable agreement in the condensed consolidated statements of financial condition. The amounts recorded for the deferred tax asset and the liability for our obligations under the tax receivable agreement are estimates. Any adjustments to our estimates subsequent to their initial establishment will be included in net income (loss). Future exchanges of Class A partnership units in Group LP for Class A common shares in the Company will be accounted for in a similar manner.

Revenue and Expense Recognition—We earn substantially all of our revenues from advisory engagements and, in many cases, we are not paid until the completion of an underlying transaction. The Company recognizes revenues from providing advisory services when or as our obligations are fulfilled and collection is reasonably assured. The vast majority of our advisory revenues, which include reimbursements for certain out-of-pocket expenses, are recognized over time; however, a small number of transactions may be recognized at a point in time. We provide our advisory service on an ongoing basis which, for example, may include evaluating and selecting one of multiple strategies. During such engagements, our clients are continuously benefitting from our counsel and the over time recognition matches the transfer of such benefits. However, the recognition of transaction fees is constrained until substantially all services have been provided, specified conditions have been met and it is probable that a significant reversal of revenue will not occur in a future period. Upfront fees and retainers specified in our engagement letters that meet the over time criteria will be recognized on a systematic basis over the estimated period where the related services are performed. Revenues may be recognized at a point in time if the engagement represents a singular objective that does not transfer any notable value until formally completed, such as when issuing a fairness opinion. In these instances, the point in time recognition appropriately matches the transfer and consumption of our services.

Incremental costs of obtaining a contract are expensed as incurred since such costs are generally not recoverable and the typical duration of our advisory contracts is less than one year. Costs to fulfill contracts consist of out-of-pocket expenses that are part of performing our advisory services and are typically expensed as incurred, except where the transfer and consumption of our services occurs at a point in time. For engagements recognized at a point in time, out-of-pocket expenses are capitalized and subsequently expensed in the condensed consolidated statement of operations upon completion of the engagement. The Company records deferred revenues when it receives fees from clients that have not yet been earned (e.g. an upfront fee) or when the Company has an unconditional right to consideration before all performance obligations are complete (e.g. upon satisfying conditions to earn an announcement fee, but before the transaction is consummated).

Complications that may terminate or delay a transaction include failure to agree upon final terms with the counterparty, failure to obtain required regulatory consents, failure to obtain board or stockholder approvals, failure to secure financing, adverse market conditions or unexpected operating or financial problems related to either party to the transaction. In these circumstances, we often do not receive advisory fees that would have been received if the transaction had been completed, despite the fact that we may have devoted considerable time and resources to the transaction. Barriers to the completion of a restructuring transaction may include a lack of anticipated bidders for the assets of our client, the inability of our client to restructure its operations, or indebtedness due to a failure to reach agreement with its creditors. In these circumstances, our fees are generally limited to monthly retainer fees and reimbursement of certain out-of-pocket expenses.

We do not allocate our revenue by the type of advice we provide because of the complexity of the transactions on which we may earn revenue and our holistic approach to client service. For example, a restructuring engagement may evolve to require a sale of all or a portion of the client, M&A assignments can develop from relationships established on prior restructuring engagements, and capital markets expertise can be instrumental on both M&A and restructuring assignments.

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Equity-based Compensation — The Company recognizes the cost of services received in exchange for equity instrument awards. The cost is based on its grant-date fair value based on quoted market prices at the time of grant amortized over the service period required by the award’s vesting terms. The Company also recognizes the cost of services received from a nonemployee in exchange for an equity instrument based on the award’s grant-date fair value. The Company records as treasury stock shares repurchased from its employees for the purpose of settling tax liabilities incurred upon the vesting of restricted stock units (“RSUs”). The Company records dividends in kind, net of forfeitures, on outstanding RSUs as a reduction of retained earnings with a corresponding increase in additional paid-in capital, resulting in no net change to equity. Dividends in kind on RSUs are subject to the same vesting conditions as the underlying RSUs on which they were accrued. Dividends in kind will be forfeited if the underlying award does not vest.

The Company has a retirement plan whereby a retiring employee generally will not forfeit certain qualifying incentive RSUs granted during employment if at retirement the employee meets certain requirements. For qualifying awards, (i) the employee must be at least 56 years old, (ii) the employee must have provided at least 5 consecutive years of service to the Company and (iii) the total of (i) and (ii) must be equal to at least 65 years. Any such RSUs will continue to vest on their applicable vesting schedule, subject to noncompetition and other terms. Over time a greater number of employees may become retirement eligible and the related requisite service period over which we will expense these awards will be shorter than the stated vesting period. Any unvested RSUs are eligible to receive dividends in kind; however, the right to dividends in kind will be forfeited if the underlying award does not vest.

Income Taxes — The Company accounts for income taxes in accordance with ASC 740, “Accounting for Income Taxes” (“ASC 740”), which requires the recognition of tax benefits or expenses on temporary differences between the financial reporting and tax bases of its assets and liabilities by applying the enacted tax rates in effect for the year in which the differences are expected to reverse. Such net tax effects on temporary differences are reflected on the Company’s condensed consolidated statements of financial condition as deferred tax assets and liabilities. Deferred tax assets are reduced by a valuation allowance when the Company believes that it is more-likely-than-not that some portion or all of the deferred tax assets will not be realized.

ASC 740-10 prescribes a two-step approach for the recognition and measurement of tax benefits associated with the positions taken or expected to be taken in a tax return that affect amounts reported in the financial statements. The Company has reviewed and will continue to review the conclusions reached regarding uncertain tax positions, which may be subject to review and adjustment at a later date based on ongoing analyses of tax laws, regulations and interpretations thereof. For the three months ended March 31, 2021 and 2020, no unrecognized tax benefit was recorded. To the extent that the Company’s assessment of the conclusions reached regarding uncertain tax positions changes as a result of the evaluation of new information, such change in estimate will be recorded in the period in which such determination is made. The Company reports income tax-related interest and penalties relating to uncertain tax positions, if applicable, as a component of income tax expense. For the three months ended March 31, 2021 and 2020, no such amounts were recorded.

The Company recognizes excess tax benefits and deficiencies as income tax benefits or expenses in the condensed consolidated statement of operations. These are reflected in accounts payable, accrued expenses and other liabilities within the condensed consolidated statement of cash flows.

Effective January 1, 2021, the Company adopted Accounting Standards Update No. 2019-12, “Income Taxes” (“ASU 2019-12”). ASU 2019-12 removes certain rule exceptions to simplify accounting for income taxes. ASU 2019-12 has been incorporated into our provision for income taxes calculation and does not have a material impact to our overall income taxes.

Foreign Currency Translation — Assets and liabilities held in non-U.S. dollar denominated currencies are translated into U.S. dollars at exchange rates in effect at the end of the reporting period. Revenues and expenses are translated at average exchange rates during the reporting period. A charge or credit is recorded to other comprehensive income to reflect the translation of these amounts to the extent the non-U.S. currency is designated the functional currency of the subsidiary. Non-functional currency related transaction gains and losses are immediately recorded in the condensed consolidated statements of operations.

3. RECENT ACCOUNTING PRONOUNCEMENTS

In March 2020, the FASB issued Accounting Standards Update No. 2020-04, “Reference Rate Reform” (“ASU 2020-04”). ASU 2020-04 provides optional guidance for entities that are impacted by interest rate reform. Specifically, ASU 2020-04 allows for contracts under the scope of Topic 310—Receivables to be accounted for prospectively with the updated interest rate, among other specifications for debt, derivative instruments, and other contracts. ASU 2020-04 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2022. Early application is permitted. Upon initial evaluation, we do not anticipate any material changes to our condensed consolidated financial statements.

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4. FIXED AND INTANGIBLE ASSETS

Equipment and leasehold improvements, net consists of the following:

	March 31,			December 31,
	2021			2020
Office equipment	$	13,286		$	13,267
Furniture and fixtures		10,529			10,409
Leasehold improvements		36,548			36,286
Construction in progress		18,078			14,943
Total		78,441			74,905
Less accumulated depreciation and amortization		(26,374	)		(24,928	)
Equipment and leasehold improvements, net	$	52,067		$	49,977

Depreciation and amortization expenses for fixed assets totaled $1,449 and $1,199 for the three months ended March 31, 2021 and 2020, respectively.

As of March 31, 2021, there were $2,493 of costs capitalized within prepaid expenses and other assets on our condensed consolidated statement of financial position related to the implementation of cloud computing arrangements. The amortization expense of the capitalized costs was $122 and $0 for the three months ended March 31, 2021 and 2020, respectively, and was recorded within communication, technology and information services on the condensed consolidated statement of operations.

5. INVESTMENTS

Fair value investments are contained within the balance of investments on the Company’s condensed consolidated statements of financial condition. The Company established a fair value hierarchy which prioritizes and ranks the level of market price observability used in measuring investments at fair value. Financial instruments measured and reported at fair value are classified and disclosed in one of the following categories (from highest to lowest level of observability) based on inputs:

Level 1—Quoted prices (unadjusted) are available in active markets for identical instruments that the Company has the ability to access as of the reporting date. The Company, to the extent that it holds such instruments, does not adjust the quoted price for these instruments, even in situations in which the Company holds a large position and a sale could reasonably affect the quoted price.

Level 2—Pricing inputs are observable for the instruments, either directly or indirectly, as of the reporting date, but are not the same as those used in level 1. Fair value is determined through the use of models or other valuation methodologies.

Level 3—Pricing inputs are unobservable for the instruments and include situations in which there is little, if any, market activity for the investments. The inputs into the determination of fair value require significant judgment or estimation by the Company’s management.

The estimated fair values of money market securities and U.S. Treasury instruments are based on quoted prices for recent trading activity in identical or similar instruments. The Company generally invests in U.S. Treasury instruments with maturities of less than twelve months. The Company considers these securities to be risk free and does not reserve for expected credit losses on these treasury investments. See Note 2 for further information on the Company’s fair value hierarchy.

The Company’s methodology for reclassifications impacting the fair value hierarchy is that transfers in/out of the respective category are reported at fair value as of the beginning of the period in which the reclassification occurred.

The following table summarizes the levels of the fair value hierarchy into which the Company’s financial assets fall as of March 31, 2021:

	Total		Level 1			Level 2		Level 3
Financial assets:
Included in cash and cash equivalents
U.S. treasury instruments	$	17,000	$	—		$	17,000	$	—
Money market securities		40,503		—			40,503		—
Investments
U.S. treasury instruments		72,262			—		72,262		—
Total financial assets	$	129,765	$		—	$	129,765	$		—

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The cost basis of the financial assets recorded at fair value included in investments on the condensed consolidated statement of financial condition was $72,258 as of March 31, 2021.

The Company holds investments in the sponsors (collectively referred to herein as “Atlas Crest Sponsors”) of Atlas Crest Investment Corp. (“Atlas Crest I”), Atlas Crest Investment Corp. II (“Atlas Crest II”), Atlas Crest Investment Corp. III (“Atlas Crest III”), Atlas Crest Investment Corp. IV (“Atlas Crest IV”) and Atlas Crest Investment Corp. V (“Atlas Crest V”), each a special purpose acquisition company (“SPAC”) (each an “Atlas Crest Entity” and collectively, the “Atlas Crest Entities”). The Company’s Chief Executive Officer, Kenneth Moelis, is a founding member and the managing member of the Atlas Crest Sponsors and serves as Non-Executive Chairman of the Atlas Crest Entities. During 2020, the Company invested $887 into the sponsor of Atlas Crest I. During 2021, the Company invested $660, $2,788, $1,960, and $1,132 in the sponsors of Atlas Crest II, Atlas Crest III, Atlas Crest IV, and Atlas Crest V, respectively. These investments in the Atlas Crest Sponsors are recorded at cost and included in investments on the consolidated statement of financial condition. As of March 31, 2021, and December 31, 2020, the aggregate investment balance of the Atlas Crest Sponsors was $7,427 and $887, respectively.

The following table summarizes the levels of the fair value hierarchy into which the Company’s financial assets fall as of December 31, 2020:

	Total		Level 1			Level 2		Level 3
Financial assets:
Included in cash and cash equivalents
U.S. treasury instruments	$	15,599	$		—	$	15,599	$	—
Money market securities		103,406		—			103,406		—
Investments
U.S. treasury instruments		172,671		—			172,671		—
Total financial assets	$	291,676	$		—	$	291,676	$		—

For the three months ended March 31, 2020, unrealized losses of $25 were recognized in other income and expenses on the condensed consolidated statement of operations related to common stock held at the reporting date. The cost basis of the financial assets recorded at fair value included in investments on the condensed consolidated statement of financial condition was $172,640 as of December 31, 2020.

Equity-method investments are contained within the balance of investments on the Company’s condensed consolidated statements of financial condition. On April 1, 2010, the Company entered into a 50-50 joint venture in Moelis Australia Holdings PTY Limited, investing a combination of cash and certain net assets in exchange for its interests. On April 10, 2017, Moelis Australia Holdings PTY Limited consummated their initial public offering and became listed on the Australian Securities Exchange as Moelis Australia Limited (ASX: MOE). As a result of the offering, the Company’s ownership interest in Moelis Australia was diluted and continues to be accounted for under the equity method of accounting.

On February 17, 2021 and February 19, 2020, Moelis Australia declared dividends, of which the Company received $2,279 and $1,942 on March 4, 2021 and March 4, 2020, respectively. The Company accounted for the dividends as a return on investment and reduced the carrying value of the investment in Moelis Australia by $2,279 and $1,942, respectively.

The balances of the Company’s equity method investment as of March 31, 2021 and December 31, 2020 were $38,754 and $38,143, respectively, and are included within investments on the condensed consolidated statements of financial condition. The Company’s share of earnings on this investment is recorded in other income and expenses on the condensed consolidated statements of operations.

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6. NET INCOME (LOSS) PER SHARE ATTRIBUTABLE TO CLASS A COMMON SHAREHOLDERS

The calculations of basic and diluted net income (loss) per share attributable to holders of shares of Class A common stock for the three months ended March 31, 2021 and 2020 are presented below.

	Three Months Ended March 31,
(dollars in thousands, except per share amounts)	2021			2020
Numerator:
Net income (loss) attributable to holders of shares of Class A common stock—basic	$	66,529		$	25,130
Add (deduct) dilutive effect of:
Noncontrolling interests related to Class A partnership units			(a)			(a)
Net income (loss) attributable to holders of shares of Class A common stock—diluted	$	66,529		$	25,130
Denominator:
Weighted average shares of Class A common stock outstanding—basic		60,932,966			52,666,457
Add (deduct) dilutive effect of:
Noncontrolling interests related to Class A partnership units			(a)			(a)
Weighted average number of incremental shares issuable from unvested RSUs and stock options, as calculated using the treasury stock method		5,427,251	(b)		4,426,525	(b)
Weighted average shares of Class A common stock outstanding—diluted		66,360,217			57,092,982
Net income (loss) per share attributable to holders of shares of Class A common stock
Basic	$	1.09		$	0.48
Diluted	$	1.00		$	0.44

We have not included the impact of Class B common stock because these shares are entitled to an insignificant amount of economic participation.

(a) Class A partnership units may be exchanged for Moelis & Company Class A common stock on a one-for-one basis, subject to applicable exchange restrictions. If all Class A partnership units were to be exchanged for Class A common stock, fully diluted Class A common stock outstanding would be 74,625,284 and 70,051,004 for the three months ended March 31, 2021 and 2020, respectively. In computing the dilutive effect, if any, that the aforementioned exchange would have on net income (loss) per share, net income (loss) available to holders of Class A common stock would be adjusted due to the elimination of the noncontrolling interests in consolidated entities associated with the Group LP Class A partnership units (including any tax impact). For the three months ended March 31, 2021 and 2020, such exchange is not reflected in diluted net income (loss) per share as the assumed exchange is not dilutive.

(b) Certain shares of Moelis & Company’s Class A common stock assumed to be issued pursuant to certain RSUs as calculated using the treasury stock method were antidilutive and therefore have been excluded from the calculation of diluted net income (loss) per share attributable to Moelis & Company for certain periods. The additional weighted average amount of RSUs that would have been included in the treasury stock method calculation if the effect were dilutive would have been 1,539 and 1,613,603 units for the three months ended March 31, 2021 and 2020, respectively.

7. EQUITY-BASED COMPENSATION

Pre-IPO Partnership Units

Prior to the Company’s IPO, the business operated as a partnership and its ownership structure was comprised of common partners (principally outside investors) holding units and Managing Directors and employees holding units. In connection with the IPO, Group LP issued Class A partnership units to Moelis & Company and to certain existing unit holders. Following the reorganization, a Group LP Class A partnership unit (not held by Moelis & Company or its subsidiaries) is exchangeable into one share of Moelis & Company Class A common stock and represents the Company’s noncontrolling interests.

The Company recognized compensation expenses of $0 and $30 for the three months ended March 31, 2021 and 2020, respectively, in relation to these pre-IPO partnership units.

2014 Omnibus Incentive Plan

In connection with the IPO, the Company adopted the Moelis & Company 2014 Omnibus Incentive Plan (the “Plan”) to provide additional incentives to selected officers, employees, Managing Directors, non-employee directors, independent contractors, partners, senior

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advisors and consultants. The Plan provides for the issuance of incentive stock options (“ISOs”), nonqualified stock options, stock appreciation rights (“SARs”), restricted stock, RSUs, stock bonuses, other stock-based awards (including partnership interests that are exchangeable into stock upon satisfaction of certain conditions) and cash awards.

Restricted Stock Units (RSUs) and Other Stock-based Awards

Pursuant to the Plan and in connection with the Company’s annual compensation process and ongoing hiring process, the Company issues RSUs and other stock-based awards which generally vest over a service life of four to five years. For the three months ended March 31, 2021 and 2020, the Company recognized expense of $50,963 and $38,225, respectively, in relation to these awards. 

The following table summarizes activity related to RSUs and other stock-based awards for the three months ended March 31, 2021 and 2020.

	RSUs and Other Stock-based Awards
	2021					2020
				Weighted					Weighted
				Average					Average
	Number of			Grant Date		Number of			Grant Date
	Shares			Fair Value		Shares			Fair Value
Unvested Balance at January 1,		8,742,695		$	41.45		8,414,130		$	42.19
Granted		3,100,355			54.74		3,585,725			37.93
Forfeited		(34,974	)		48.44		(48,512	)		37.00
Vested		(3,689,539	)		42.86		(2,894,992	)		38.67
Unvested Balance at March 31,		8,118,537		$	46.43		9,056,351		$	41.53

As of March 31, 2021, the total compensation expense related to unvested RSUs and other stock-based awards not yet recognized was $221,171. The weighted-average period over which this compensation expense is expected to be recognized at March 31, 2021 is 2.2 years.

Stock Options

Pursuant to the Plan, the Company issued 3,501,881 stock options in 2014 which vest over a five-year period. The Company estimated the fair value of stock option awards at grant using the Black-Scholes valuation model with the following assumptions:

	Assumptions
Expected life (in years)		6
Weighted-average risk free interest rate		1.91	%
Expected volatility		35	%
Dividend yield		2.72	%
Weighted-average fair value at grant date	$	6.70

During the six year life of the options, the Company paid special dividends of $9.05, in aggregate. As required under Section 5 of the Company’s 2014 Omnibus Incentive Plan, the Compensation Committee of the Company’s Board of Directors equitably reduced the exercise price of the Company’s outstanding options to purchase common stock by $9.05 from $25.00 per share to $15.95 per share.

The following table summarizes activity related to stock options for the three months ended March 31, 2020:

	Stock Options Outstanding
	2020
				Weighted
				Average
	Number			Exercise Price
	Outstanding			Per Share
Outstanding at January 1,		728,534		$	15.95
Exercises		(722,034	)		15.95
Forfeitures or expirations		—			—
Outstanding at March 31,		6,500		$	15.95

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For the three months ended March 31, 2021 and 2020, the Company recognized no expenses in relation to these stock options. As of April 2020, no stock options remain outstanding.

Share Repurchase Plan

In February 2019, the Board of Directors authorized the repurchase of up to $100,000 of shares of Class A common stock and/or Class A partnership units of Group LP with no expiration date. Under this share repurchase program, shares may be repurchased from time to time in open market transactions, in privately negotiated transactions or otherwise. The timing and the actual number of shares repurchased will be opportunistic and measured in nature and will depend on a variety of factors, including price and market conditions. The remaining balance of shares authorized for repurchase under the program was $73,601 as of March 31, 2021.

8. STOCKHOLDERS EQUITY

Class A Common Stock

In April 2014, the Company issued 15,263,653 shares of Class A common stock in connection with the IPO and reorganization. Since its IPO, the Company has conducted several offerings of Class A common stock in order to facilitate organized liquidity and increase the public float of its Class A common stock. The aggregate increase to Class A common stock as a result of such offerings was 24,923,349 shares. The Company did not retain any proceeds from the sale of its Class A common stock.

As of March 31, 2021, there were 66,648,561 shares of Class A common stock issued, 5,323,017 shares of treasury stock, and 61,325,544 shares outstanding, and as of December 31, 2020, there were 61,986,927 shares of Class A common stock issued, 3,959,083 shares of treasury stock, and 58,027,844 shares outstanding. The changes in Class A common stock are due primarily to the IPO, offering transactions described above, exchanges of Class A partnership units, the exercise of stock options and vesting of restricted stock units in connection with the Company’s annual compensation process and ongoing hiring process.

Class B Common Stock

In conjunction with Moelis & Company’s IPO of its Class A common stock, the Company issued 36,158,698 shares of Class B common stock. Moelis & Company Partner Holdings LP (“Partner Holdings”) holds all shares of Class B common stock, enabling it initially to exercise majority voting control over the Company. In connection with the Company’s offerings of Class A common stock described above, 24,919,744 shares of Class B common stock were purchased from Partner Holdings at a cost of $550. The economic rights of Class B common stock are based on the ratio of the Class B subscription price to the initial public offering price of shares of Class A common stock (.00055 to 1). Shares of Class B common stock are generally not transferrable and, if transferred other than in the limited circumstances set forth in Moelis & Company’s Amended and Restated Certificate of Incorporation, such shares shall automatically convert into a number of shares of Class A common stock, or dollar equivalent. Each share of Class B common stock may also be converted to a number of Class A shares at the option of the holder. Holders of shares of Class B common stock are entitled to receive dividends of the same type as any dividends payable on outstanding shares of Class A common stock at a ratio of .00055 to 1.

As of March 31, 2021, and December 31, 2020, 4,899,457 and 5,948,750 shares of Class B common stock were issued and outstanding, respectively, due primarily to the IPO, offering transactions, and Class B conversions described above.

Treasury Stock

During the three months ended March 31, 2021 and 2020, the Company repurchased 1,363,934 and 869,779 shares, respectively, pursuant to the Company’s share repurchase program and shares repurchased from its employees for the purpose of settling tax liabilities incurred upon the delivery of equity-based compensation awards. The result of the repurchases was an increase of $74,211 and $31,636, respectively, in the treasury stock balance on the Company’s condensed consolidated statements of changes in equity as of March 31, 2021 and 2020.

Noncontrolling Interests

A Group LP Class A partnership unit (not held by Moelis & Company or its subsidiaries) is exchangeable into one share of Moelis & Company Class A common stock and represents the Company’s noncontrolling interests (non-redeemable). As of March 31, 2021 and December 31, 2020, partners held 7,855,398 and 8,508,857 Group LP partnership units, respectively, representing an 11% and 13% noncontrolling interest in Moelis & Company, respectively.

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Controlling Interests

Moelis & Company operates and controls all of the business and affairs of Group LP and its operating entity subsidiaries indirectly through its equity interest in Group GP, and thus the 61,325,544 shares of Class A common stock outstanding at March 31, 2021 (58,027,844 as of December 31, 2020), represents the controlling interest.

9. RELATED-PARTY TRANSACTIONS

Aircraft Lease— On August 30, 2014, a related party, Moelis & Company Manager LLC ("Manager"), acquired an aircraft with funds received solely from its managing member (Mr. Moelis). The aircraft was used and operated by the Company pursuant to a dry lease with Manager. The terms of the dry lease were comparable to the market rates of leasing from an independent third party. Pursuant to this dry lease arrangement, the lessee is obligated to bear its share of the costs of operating the aircraft. In addition, Mr. Moelis was the other lessee of the aircraft and shared the operating and related costs of the plane in proportion to his respective use pursuant to a cost sharing and operating agreement. On July 12, 2019, the Company terminated its aircraft dry lease with Manager, the lessor, and Mr. Moelis, the other lessee (the “Old Lease”) and the related cost sharing agreement with Mr. Moelis, which were set to expire by their terms on December 31, 2019, and entered into a new dry lease with Manager, the lessor, and Mr. Moelis, the other lessee (the “New Lease”) and cost sharing agreement with Mr. Moelis, which terminate on December 31, 2022. The terms of the New Lease and new cost sharing agreement are substantially similar to the Old Lease and related cost sharing agreement.

For the three months ended March 31, 2021 and 2020, the Company incurred $324 and $324 in aircraft lease costs to be paid to Manager, respectively.

Promissory Notes —As of March 31, 2021, there were $319 of unsecured promissory notes from employees held by the Company (December 31, 2020: $389). Any outstanding balances are reflected in accrued and other receivables on the condensed consolidated statements of financial condition. The notes bear fixed interest rates ranging from 3.00% to 4.00%. During the three months ended March 31, 2021 and 2020, the Company received $70 and $0 of principal repayments and recognized interest income of $5 and $2, on such notes, respectively, which is included in other income and expenses on the condensed consolidated statements of operations.

Services Agreement —In connection with the Company’s IPO, the Company entered into a services agreement with a related party, Moelis Asset Management LP, whereby the Company provides certain administrative services to Moelis Asset Management LP for a fee. This fee totaled $57 and $110 for the three months ended March 31, 2021 and 2020, respectively. The amount of the fee is based upon the estimated usage and related expense of all shared services between the Company and Moelis Asset Management LP during the relevant period, and will be assessed periodically by management as per the terms of the agreement. As of March 31, 2021 and December 31, 2020, the Company had no balances due from Moelis Asset Management LP.

Affiliated SPACs—During 2020, the Company began providing office space, secretarial, administrative and other corporate services for a fee of $10 a month to Atlas Crest I. In February 2021, the Company began providing these services to Atlas Crest II and is expected to begin providing these services to the other Atlas Crest Entities upon consummation of their initial public offerings, in each case for a fee of $10 per month. For the three months ended March 31, 2021, these fees totaled $50. This arrangement shall continue with each Atlas Crest Entity until such Atlas Crest Entity consummates a business combination or is liquidated. As of March 31, 2021 and December 31, 2020, the Company had no balance due from the Atlas Crest Entities or their sponsors.

In addition to the Company’s investments in the Atlas Crest Sponsors (described further in Note 5), the Company’s Executive Officers have a material, non-majority investment in the Atlas Crest Sponsors.

Moelis Australia —As of March 31, 2021 and December 31, 2020, the Company had a balance of $5 due to Moelis Australia which is reflected in accrued and other receivables on the condensed consolidated statements of financial condition. These balances consist of amounts due to or from Moelis Australia for advisory services performed as well as billable expenses incurred by the Company on behalf of Moelis Australia during the period. The relationship between the Company and Moelis Australia is governed by a services agreement.

Revenues —From time to time, the Company enters into advisory transactions with Moelis Asset Management LP and its affiliates. The Company earned revenues associated with such transactions of $0 for each of the three months ended March 31, 2021 and 2020, respectively.  

10. REGULATORY REQUIREMENTS

Under the SEC Uniform Net Capital Rule (SEC Rule 15c3-1) Alternative Standard under Section (a)(1)(ii), the minimum net capital requirement is $250. At March 31, 2021, Moelis U.S. had net capital of $101,232, which was $100,982 in excess of its required net capital. At December 31, 2020, Moelis U.S. had net capital of $96,800 which was $96,550 in excess of its required net capital.

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Certain other non-U.S. subsidiaries are subject to various securities and banking regulations and capital adequacy requirements promulgated by the regulatory and exchange authorities of the countries in which they operate. These subsidiaries have exceeded their local capital adequacy requirements at March 31, 2021.

11. COMMITMENTS AND CONTINGENCIES

Bank Line of Credit — In April 2020, the Company renewed its $65,000 revolving credit facility which extended the maturity date to June 30, 2021. Unless the lender issues a notice of termination at least 60 days prior to such maturity date, this facility will automatically extend to June 30, 2022.

Borrowings on the facility bear interest at the greater of a fixed rate of 3.50% per annum or at the borrower’s option of (i) LIBOR plus 1% or (ii) Prime minus 1.50%. As of March 31, 2021 and December 31, 2020, the Company had no borrowings under the credit facility.

As of March 31, 2021, the Company’s available credit under this facility was $60,507 as a result of the issuance of an aggregate amount of $4,493 of various standby letters of credit, which were required in connection with certain office lease and other agreements. The Company incurs a 1% per annum fee on the outstanding balance of issued letters of credit.

Leases —The Company maintains operating leases for corporate offices and an aircraft with various expiration dates, some of which extend through 2036. Some leases include options to terminate or to extend the lease terms. The Company records lease liabilities measured at the present value of anticipated lease payments over the lease term, including options to extend or terminate the lease when it is reasonably certain such options will be exercised. The implicit discount rates used to determine the present value of the Company’s leases are not readily determinable, thus the Company uses its secured borrowing rate, which was determined with reference to our available credit line. See below for additional information about the Company’s leases.

	Three Months Ended
	March 31,
($ in thousands)	2021			2020
Supplemental Income Statement Information:
Operating lease cost	$	7,154		$	6,365
Supplemental Cash Flow Information:
Cash paid for amounts included in the measurement of lease liabilities:
Net operating cash outflows for operating leases	$	5,980		$	5,299
Right-of-use assets obtained in exchange for lease obligations (e.g. new leases and amendments commenced during the period):	$	321		$	2,414
Other Information
Weighted-average remaining lease term - operating leases		13.69	years		13.82	years
Weighted-average discount rate - operating leases		3.52	%		3.53	%

The future sublease income and maturities of our operating lease liabilities as of March 31, 2021, are as follows:

Fiscal year ended	Sublease Income			Operating Leases
Remainder of 2021	$	(689	)	$	14,323
2022		(919	)		24,214
2023		(919	)		20,971
2024		(919	)		19,085
2025		(459	)		16,326
Thereafter		-			177,587
Total Payments	$	(3,905	)	$	272,506
Less: Tenant improvement allowances					(18,440	)
Less: Present value adjustment					(60,190	)
Total				$	193,876

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Contractual Arrangements —In the normal course of business, the Company enters into contracts that contain a variety of representations and warranties and which provide indemnification for specified losses, including certain indemnification of certain officers, directors and employees.

Legal —In the ordinary course of business, from time to time the Company and its affiliates are involved in judicial or regulatory proceedings, arbitration or mediation concerning matters arising in connection with the conduct of its businesses, including contractual and employment matters. In addition, government agencies and self-regulatory organizations conduct periodic examinations and initiate administrative proceedings regarding the Company’s business, including, among other matters, compliance, accounting and operational matters, that can result in censure, fine, the issuance of cease-and-desist orders or the suspension or expulsion of a broker-dealer, investment advisor, or its directors, officers or employees. In view of the inherent difficulty of determining whether any loss in connection with such matters is probable and whether the amount of such loss can be reasonably estimated, particularly in cases where claimants seek substantial or indeterminate damages or where investigations and proceedings are in the early stages, the Company cannot estimate the amount of such loss or range of loss, if any, related to such matters, how or if such matters will be resolved, when they will ultimately be resolved, or what the eventual settlement, fine, penalty or other relief, if any, might be. Subject to the foregoing, the Company believes, based on current knowledge and after consultation with counsel, that it is not currently party to any material pending proceedings, individually or in the aggregate, the resolution of which would have a material effect on the Company.

12. EMPLOYEE BENEFIT PLANS

The Company covers substantially all U.S. salaried employees with a defined contribution 401(k) plan. Each salaried employee of the Company who has attained the age of 21 is eligible to participate in the 401(k) plan on their first day of employment. Any employer contributions to the 401(k) plan are entirely at the discretion of the Company. The Company accrued expenses relating to employer matching contributions to the 401(k) plan for the three months ended March 31, 2021 and 2020, in the amounts of $715 and $696, respectively.

13. INCOME TAXES

The Company’s operations are comprised of entities that are organized as limited liability companies and limited partnerships. For U.S. federal income tax purposes, taxes related to income earned by these entities represent obligations of their interest holders, except for certain other foreign, state, and local taxes (for example, the New York City unincorporated business tax (“UBT”)). In addition, the Company is subject to U.S. corporate federal, state, and local income tax on its allocable share of results of operations from Group LP.

The Company’s provisions for income taxes and effective tax rates were a benefit of $176 and (0.2%) and a benefit of $7,344 and (32.2%), for the three months ended March 31, 2021 and 2020, respectively. The income tax provision for the aforementioned periods primarily reflects the Company’s allocable share of earnings from Group LP at the prevailing U.S. federal, state, and local corporate income tax rates offset by the effect of the excess tax benefit recognized in connection with the delivery of equity-based compensation at an appreciated price above the grant date price for such equity. The excess tax benefits for the three months ended March 31, 2021 and 2020 were $17,542 and $7,337, respectively.

There was an exchange of Class A partnership units for Class A common stock in February 2021 that resulted in an increase to our deferred tax asset related to a step-up in the tax basis in Group LP assets. Approximately $19,392 of the increase to this deferred tax asset is attributable to exchanges by certain partners of Group LP who are party to the tax receivable agreement. Pursuant to this agreement, 85% (or $16,483) of the tax benefits associated with this portion of the deferred tax asset are payable to such exchanging partners over the next 15 years and recorded as amount due pursuant to tax receivable agreement in the condensed consolidated statements of financial condition. The remaining tax benefit is allocable to the Company and is recorded in additional paid-in-capital.

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14. REVENUES AND BUSINESS INFORMATION

The Company’s activities as an investment banking advisory firm constitute a single business segment offering clients, including corporations, governments, sovereign wealth funds, and financial sponsors, a range of advisory services with expertise across all major industries in mergers and acquisitions, recapitalizations and restructurings, capital markets and other corporate finance matters.

Since the financial markets are global in nature, the Company generally manages its business based on the operating results of the enterprise taken as whole, not by geographic region. The following table disaggregates the revenues and assets based on the location of the office that generates the revenues or holds the assets, and therefore may not be reflective of the geography in which our clients are located.

	Three Months Ended March 31,
	2021		2020
Revenues:
United States	$	206,252	$	129,185
Europe		43,716		16,256
Rest of World		13,898		8,265
Total	$	263,866	$	153,706

	March 31,		December 31,
	2021		2020
Assets:
United States	$	899,075	$	1,012,831
Europe		87,404		78,470
Rest of World		84,618		105,143
Total	$	1,071,097	$	1,196,444

As of March 31, 2021, and December 31, 2020, the Company had deferred revenues of $8,105 and $2,692, respectively. These amounts primarily consist of upfront fees and retainers for our services. During the three months ended March 31, 2021, $1,682 of revenues were recognized from the opening balance of deferred revenues.

Due to the factors that may delay or terminate a transaction (see Note 2), the Company does not estimate constrained transaction fees for revenue recognition. Quantitative disclosures of constrained variable consideration are not provided for remaining, wholly unsatisfied, performance obligations. The remaining performance obligations related to retainers, upfront fees and announcement fees are typically associated with contracts that have durations of one year or less.

15. SUBSEQUENT EVENTS

The Board of Directors of Moelis & Company declared a special dividend of $2.00 per share in addition to a regular quarterly dividend of $0.55 per share. The $2.55 per share will be paid on June 18, 2021 to shareholders of record as of May 10, 2021.

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

This Management’s Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with our unaudited condensed consolidated financial statements and related notes included elsewhere in this Form 10-Q and our audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2020.

Forward-Looking Statements and Certain Factors that May Affect Our Business

The following discussion should be read in conjunction with our condensed consolidated financial statements and the related notes that appear elsewhere in this Form 10-Q. We have made statements in this discussion that are forward-looking statements You can identify these forward looking statements by the use of words such as “may,” “might,” “will,” “should,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “intend,” “predict,” “potential” or “continue,” the negative of these terms and other comparable terminology. These forward looking statements, which are subject to risks, uncertainties, and assumptions about us, may include projections of our future financial performance, based on our growth strategies and anticipated trends in our business. These statements are only predictions based on our current expectations and projections about future events You should consider the numerous risks outlined under “Risk Factors” in our Annual Report on Form 10-K and in this Form 10-Q.

Although we believe the expectations reflected in the forward looking statements are reasonable, we cannot guarantee future results, level of activity, performance or achievements. Moreover, neither we nor any other person assumes responsibility for the accuracy or completeness of any of these forward looking statements. You should not rely upon forward looking statements as a prediction of future events. We are under no duty to and we do not undertake any obligation to update or review any of these forward looking statements after the date of this filing to conform our prior statements to actual results or revised expectations whether as a result of new information, future developments or otherwise.

Executive Overview

Moelis & Company is a leading global independent investment bank that provides innovative strategic advice and solutions to a diverse client base, including corporations, governments and financial sponsors. We assist our clients in achieving their strategic goals by offering comprehensive integrated financial advisory services across all major industry sectors. With 22 geographical locations in the Americas, Europe, the Middle East, Asia and Australia, we advise clients around the world on their most critical decisions, including mergers and acquisitions, recapitalizations and restructurings, capital markets and other corporate finance matters. Our ability to provide confidential, independent advisory services to our clients across sectors and regions and through all phases of the business cycle has led to long-term client relationships and a diversified revenue base.

As of March 31, 2021, we served our clients globally with 613 advisory bankers. We generate revenues primarily from providing advisory services on transactions that are subject to individually negotiated engagement letters which set forth our fees. We generally generate fees at key transaction milestones, such as closing, the timing of which is outside of our control. As a result, revenues and net income in any period may not be indicative of full year results or the results of any other period and may vary significantly from year to year and quarter to quarter. The performance of our business depends on the ability of our professionals to build relationships with clients over many years by providing trusted advice and exceptional transaction execution.

Business Environment and Outlook

Economic and global financial conditions can materially affect our operational and financial performance. See “Risk Factors” in Part II. Other Information of this Form 10-Q and in our Form 10-K for a discussion of some of the factors that can affect our performance. The M&A market data for announced and completed transactions during the three months ended March 31, 2021 and 2020, referenced throughout this Form 10-Q was obtained from Refinitiv, formerly known as Thomson Financial as of April 5, 2021, and April 4, 2020.

For the first three months of 2021, we earned revenues of $263.9 million compared with $153.7 million earned during the same period in 2020. This represents an increase of 72% year over year and compares favorably with an 18% increase in the number of global completed M&A transactions greater than $100 million in the same period.

Our team of investment banking professionals continues to be very active, providing high quality advice to a growing number of clients around the globe. In the fourth quarter of 2020 the global M&A market experienced the strongest quarter of announced transactions in history. The same elevated pace of announcements continued into 2021, starting the year with a very robust environment for deal announcements. This strong activity should allow for a positive M&A environment in the near to intermediate term. As a result, our M&A activity for both strategics and financial sponsors remains elevated versus the prior year. While the health of the global economy has improved dramatically since last year, our restructuring activity continues to be steady as companies in certain parts of the economy are continuing to experience ongoing financial issues as a result of the business disruption caused by COVID-19. In addition, the record levels of corporate debt issued in the past year should also provide a solid level of restructuring activity over the longer-term. Combined with our growing capital markets business, which benefits from our SPAC expertise, we believe we are well positioned to provide advice to companies across all sectors on their capital and liquidity needs.

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Our talented employees have adapted to the work from home environment caused by COVID-19. We believe that while COVID-19 may continue to add uncertainty to the business environment, our Firm remains well positioned due to our business continuity planning, experienced management team, and focused client coverage.

Results of Operations

The following is a discussion of our results of operations for the three months ended March 31, 2021 and 2020.

	Three Months Ended March 31,
($ in thousands)	2021			2020			Variance
Revenues	$	263,866		$	153,706		72%
Expenses:
Compensation and benefits		156,499			95,120		65%
Non-compensation expenses		34,924			34,144		2%
Total operating expenses		191,423			129,264		48%
Operating income (loss)		72,443			24,442		196%
Other income and (expenses)		3,179			(1,660	)	N/M
Income (loss) before income taxes		75,622			22,782		232%
Provision (benefit) for income taxes		(176	)		(7,344	)	-98%
Net income (loss)	$	75,798		$	30,126		152%

N/M = Not meaningful

Revenues

We operate in a highly competitive environment. Each revenue-generating engagement is separately solicited, awarded and negotiated, and there are usually no long-term contracted sources of revenue. As a consequence, our fee-paying client engagements are not predictable, and high levels of revenues in one period are not necessarily predictive of continued high levels of revenues in future periods. To develop new business, our professionals maintain an active dialogue with a large number of existing and potential clients. We add new clients each year as our bankers continue to expand their relationships, as we hire senior bankers who bring their client relationships and as we receive introductions from our relationship network of senior executives, board members, attorneys and other third parties. We also lose clients each year as a result of the sale or merger of clients, changes in clients’ senior management, competition from other financial services firms and other causes.

We earn substantially all of our revenues from advisory engagements, and, in many cases, we are not paid until the completion of an underlying transaction. The vast majority of our advisory revenues are recognized over time, although the recognition of our transaction fees are constrained until the engagement is substantially complete.

Complications that may terminate or delay a transaction include failure to agree upon final terms with the counterparty, failure to obtain required regulatory consents, failure to obtain board or stockholder approvals, failure to secure financing, adverse market conditions or unexpected operating or financial problems related to either party to the transaction. In these circumstances, we often do not receive advisory fees that would have been received if the transaction had been completed, despite the fact that we may have devoted considerable time and resources to the transaction. Barriers to the completion of a restructuring transaction may include a lack of anticipated bidders for the assets of our client, or the inability of our client to restructure its operations, or indebtedness due to a failure to reach agreement with its creditors. In these circumstances, our fees are generally limited to monthly retainer fees and reimbursement of certain out-of-pocket expenses.

We do not allocate our revenue by the type of advice we provide because of the complexity of the transactions on which we may earn revenue and our holistic approach to client service. For example, a restructuring engagement may evolve to require a sale of all or a portion of the client, M&A assignments can develop from relationships established on prior restructuring engagements, and capital markets expertise can be instrumental on both M&A and restructuring assignments.

Three Months Ended March 31, 2021 versus 2020

Revenues were $263.9 million for the three months ended March 31, 2021 as compared with $153.7 million for the same period in 2020, representing an increase of 72%. The increase in revenues was primarily driven by greater transaction completions as compared to the prior year period.

For the three months ended March 31, 2021 and 2020, the number of fee-paying clients increased to 178 clients from 117 clients, respectively, and the number of clients that paid fees equal to or greater than $1 million increased to 68 clients from 39 clients for the same period of 2020.

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Operating Expenses

The following table sets forth information relating to our operating expenses:

	Three Months Ended March 31,
($ in thousands)	2021			2020			Variance
Expenses:
Compensation and benefits	$	156,499		$	95,120			65	%
% of revenues		59	%		62	%
Non-compensation expenses	$	34,924		$	34,144			2	%
% of revenues		13	%		22	%
Total operating expenses	$	191,423		$	129,264			48	%
% of revenues		73	%		84	%

Our operating expenses are classified as compensation and benefits expenses and non-compensation expenses, and headcount is the primary driver of the level of our expenses. Compensation and benefits expenses account for the majority of our operating expenses. Non-compensation expenses, which include the costs of professional fees, travel and related expenses, communication, technology and information services, occupancy, depreciation and other expenses, generally have been less significant in comparison with compensation and benefits expenses.

Three Months Ended March 31, 2021 versus 2020

Operating expenses were $191.4 million for the three months ended March 31, 2021 and represented 73% of revenues, compared with $129.3 million for the same period in 2020 which represented 84% of revenues. The increase in operating expenses was primarily driven by higher compensation and benefits expenses associated with greater revenues.

Compensation and Benefits Expenses

Our compensation and benefits expenses are determined by management based on revenues earned, the competitiveness of the prevailing labor market and anticipated compensation requirements for our employees, the level of recruitment of new Managing Directors, the amount of compensation expenses amortized for equity awards and other relevant factors. As a result, our compensation expenses may fluctuate materially in any particular period. Accordingly, the amount of compensation expenses recognized in any particular period may not be consistent with prior periods or indicative of future periods.

Our compensation expenses consist of base salary and benefits, annual incentive compensation payable as cash bonus awards, including certain amounts subject to clawback and contingent upon a required period of service (“contingent cash awards”) and amortization of equity‑based compensation awards. Base salary and benefits are paid ratably throughout the year. Equity awards are amortized into compensation expenses on a graded basis (based upon the fair value of the award at the time of grant) during the service period over which the award vests, which is typically four or five years. The awards are recorded within equity as they are expensed. Contingent cash awards are amortized into compensation expenses over the required service period. Cash bonuses, which are accrued throughout the year, are discretionary and dependent upon a number of factors including the performance of the Company and are generally paid during the first two months of the year with respect to prior year performance. The equity component of the annual incentive award is determined with reference to the Company’s estimate of grant date fair value, which in turn determines the number of equity awards granted subject to a vesting schedule.

Three Months Ended March 31, 2021 versus 2020

For the three months ended March 31, 2021, compensation related expenses of $156.5 million represented 59% of revenues, compared with $95.1 million which represented 62% of revenues in the prior year period. The increase in compensation expenses was primarily related to higher discretionary bonus expense associated with greater revenues as compared to the prior year period.

Non-Compensation Expenses

Our non-compensation expenses include the costs of occupancy, professional fees, communication, technology and information services, travel and related expenses, depreciation and other expenses.

Historically (prior to COVID-19), our non-compensation expenses have increased as we have increased headcount which results from growing our business. This trend may continue as we expand into new sectors, geographies and products to serve our clients’ growing needs.

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Three Months Ended March 31, 2021 versus 2020

For the three months ended March 31, 2021, non‑compensation expenses of $34.9 million represented 13% of revenues, compared with $34.1 million which represented 22% of revenues in the prior year period. The marginal increase is primarily related to increased transaction related costs associated with certain revenues, partially offset by decreased travel and other business development expenses related to COVID-19 social distancing restrictions.

Other Income and Expenses

Other income and expenses consists of earnings from equity method investments, gains and losses on investments, interest income and expense, and other infrequent gains or losses.

Three Months Ended March 31, 2021 versus 2020

Other income and expenses were income of $3.2 million and expense of $1.7 million for the three months ended March 31, 2021 and 2020, respectively. The increase in other income and expenses is primarily related to the Company’s share of earnings from its investment in Moelis Australia.

Provision for Income Taxes

The Company’s operations are comprised of entities that are organized as limited liability companies and limited partnerships. For U.S. federal income tax purposes, taxes related to income earned by these entities represent obligations of their interest holders, except for certain foreign, state and local income taxes (for example, the New York City unincorporated business tax (“UBT”)). The Company is subject to U.S. corporate, federal, state, and local income tax on its allocable share of results of operations from Group LP.

Three Months Ended March 31, 2021 versus 2020

The Company’s provision for income taxes and effective tax rates were a benefit of $0.2 million and (0.2%) and a benefit of $7.3 million and (32.2%), for the three months ended March 31, 2021 and 2020, respectively. The income tax provision and effective tax rate for the aforementioned periods primarily reflect the Company’s allocable share of operating results from Group LP at the prevailing U.S. federal, state, and local corporate income tax rate, offset by the impact of the excess tax benefit recognized in connection with equity-based compensation delivered at a price above the grant date price.

Liquidity and Capital Resources

Our current assets have historically been comprised of cash, short term liquid investments and receivables related to fees earned from providing advisory services. Our current liabilities are primarily comprised of accrued expenses, including accrued employee compensation. We pay a significant portion of incentive compensation during the first two months of each calendar year with respect to the prior year’s results. We also distribute estimated partner tax payments primarily in the first quarter of each year with respect to the prior year’s operating results. Therefore, levels of cash generally decline during the first quarter of each year after incentive compensation has been paid to our employees and estimated tax payments have been distributed to partners. Cash before dividends and share buybacks then typically builds over the remainder of the year.

We evaluate our cash needs on a regular basis in light of current market conditions. Cash and cash equivalents include all short‑term highly liquid investments that are readily convertible to known amounts of cash and have original maturities of three months or less from the date of purchase. As of March 31, 2021 and December 31, 2020, the Company had cash equivalents of $57.5 million and $119.0 million, respectively, invested in U.S. Treasury instruments and money market securities. Additionally, as of March 31, 2021 and December 31, 2020, the Company had cash of $97.9 million and $83.5 million, respectively, maintained in U.S. and non‑U.S. bank accounts, of which most bank account balances exceeded the U.S. Federal Deposit Insurance Corporation (“FDIC”) and U.K. Financial Services Compensation Scheme (“FSCS”) coverage limits.

In addition to cash and cash equivalents, we hold various types of government debt securities that are classified as investments on our condensed consolidated statements of financial condition as they have original maturities of three months or more from the date of purchase. As of March 31, 2021 and December 31, 2020, the Company held $72.3 million and $172.7 million of U.S. treasury instruments classified as investments, respectively.

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Our liquidity is highly dependent upon cash receipts from clients which generally requires the successful completion of transactions. The timing of receivable collections typically occurs within 60 days of billing. As of March 31, 2021 and December 31, 2020 accounts receivable were $71.8 million and $89.3 million, respectively, net of allowances of $6.2 million and $3.8 million, respectively.

To provide for additional working capital and other general corporate purposes, we maintain a $65.0 million revolving credit facility. Unless the lender issues a notice of termination at least 60 days prior to the maturity date of June 30, 2021, this facility will automatically extend to June 30, 2022. Advances on the facility bear interest at the greater of a fixed rate of 3.50% per annum or at the Company’s option of (i) LIBOR plus 1% or (ii) Prime minus 1.50%. As of March 31, 2021, the Company had no borrowings under the credit facility.

As of March 31, 2021, the Company’s available credit under this facility was $60.5 million as a result of the issuance of an aggregate amount of $4.5 million of various standby letters of credit, which were required in connection with certain office leases and other agreements. The Company incurs a 1% per annum fee on the outstanding balances of issued letters of credit.

The Board of Directors of Moelis & Company declared a special dividend of $2.00 per share in addition to a regular quarterly dividend of $0.55 per share. The $2.55 per share will be paid on June 18, 2021 to Class A common shareholders of record on May 10, 2021. During the three months ended March 31, 2021 the Company paid aggregate dividends of $0.55 per share.

In February 2019, the Board of Directors authorized the repurchase of up to $100 million of shares of Class A common stock and/or Class A partnership units of Group LP with no expiration date. This new authorization replaced the former repurchase program and the remaining authorization under the program was eliminated. During the three months ended March 31, 2021 and 2020, the Company repurchased 1,363,934 and 869,779 shares, respectively, pursuant to the Company’s share repurchase program and shares repurchased from its employees for the purpose of settling tax liabilities incurred upon delivery of equity-based compensation awards. The remaining balance of shares authorized for repurchase under the program was $73.6 million as of March 31, 2021.

Regulatory Capital

We actively monitor our regulatory capital base. Our principal subsidiaries are subject to regulatory requirements in their respective jurisdictions to ensure general financial soundness and liquidity. This requires, among other things, that we comply with certain minimum capital requirements, record‑keeping, reporting procedures, experience and training requirements for employees and certain other requirements and procedures. These regulatory requirements may restrict the flow of funds to and from affiliates. See Note 10 of the condensed consolidated financial statements as of March 31, 2021 for further information. These regulations differ in the United States, United Kingdom, Hong Kong and other countries in which we operate a registered broker‑dealer. The license under which we operate in each such country is meant to be appropriate to conduct an advisory business. We believe that we provide each of our subsidiaries with sufficient capital and liquidity, consistent with their business and regulatory requirements.

Tax Receivable Agreement

In connection with the IPO in April 2014, we entered into a tax receivable agreement with our eligible Managing Directors that provides for the payment to eligible Managing Directors of 85% of the amount of cash savings, if any, in U.S. federal, state, and local income tax or franchise tax that we realize as a result of (a) the increases in tax basis attributable to exchanges by our eligible Managing Directors and (b) tax benefits related to imputed interest deemed to be paid by us as a result of this tax receivable agreement. The Company expects to benefit from the remaining 15% of income tax cash savings, if any, that we realize.

For purposes of the tax receivable agreement, income tax cash savings will be computed by comparing our actual income tax liability to the amount of such taxes that we would have been required to pay had there been no increase to the tax basis of the tangible and intangible assets of Group LP as a result of the exchanges and had we not entered into the tax receivable agreement. The term of the tax receivable agreement commenced upon consummation of the IPO and will continue until all such tax benefits have been utilized or expired, unless we exercise our right to terminate the tax receivable agreement for an amount based on an agreed value of payments remaining to be made under the agreement.

Payments made under the tax receivable agreement are required to be made within 225 days of the filing of our tax returns. Because we generally expect to receive the tax savings prior to making the cash payments to the eligible selling holders of Group LP partnership units, we do not expect the cash payments to have a material impact on our liquidity.

In addition, the tax receivable agreement provides that, upon a merger, asset sale, or other form of business combination or certain other changes of control or if, at any time, we elect an early termination of the tax receivable agreement, our (or our successor’s) obligations with respect to exchanged or acquired units (whether exchanged or acquired before or after such change of control or early termination) will be based on certain assumptions, including that we would 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

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election, that any units that have not been exchanged are deemed exchanged for the market value of the Class A common stock at the time of termination. Consequently, it is possible, in these circumstances, that the actual cash tax savings realized by us may be significantly less than the corresponding tax receivable agreement payments.

Cash Flows

Our operating cash flows are primarily influenced by the amount and timing of receipt of advisory fees, which are generally collected within 60 days of billing, and the payment of operating expenses, including payments of incentive compensation to our employees. We pay a significant portion of incentive compensation during the first two months of each calendar year with respect to the prior year’s results. Our investing and financing cash flows are primarily influenced by activities to fund investments and payments of dividends and estimated partner taxes. A summary of our operating, investing and financing cash flows is as follows:

	Three Months Ended
($ in thousands)	2021			2020
Cash Provided By (Used In)
Operating Activities:
Net income (loss)	$	75,798		$	30,126
Non-cash charges		74,191			35,348
Other operating activities		(172,956	)		(138,567	)
Total operating activities		(22,967	)		(73,093	)
Investing Activities		90,854			139,958
Financing Activities		(113,896	)		(108,506	)
Effect of exchange rate changes		(792	)		(2,176	)
Net increase (decrease) in cash		(46,801	)		(43,817	)
Cash, cash equivalents, and restricted cash, beginning of period		203,284			168,572
Cash, cash equivalents, and restricted cash, end of period	$	156,483		$	124,755

Three months ended March 31, 2021

Cash, cash equivalents and restricted cash were $156.5 million at March 31, 2021, a decrease of $46.8 million from $203.3 million at December 31, 2020. Operating activities resulted in a net outflow of $23.0 million primarily attributable to cash collected from clients, net of cash operating outflows, including discretionary bonuses paid during the period. Investing activities resulted in a net inflow of $90.9 million primarily attributable to cash inflows for net sales of investments. Financing activities resulted in a net outflow of $113.9 million primarily related to treasury stock purchases and the payment of dividends and tax distributions.

Three months ended March 31, 2020

Cash, cash equivalents and restricted cash were $124.8 million at March 31, 2020, a decrease of $43.8 million from $168.6 million at December 31, 2019. Operating activities resulted in a net outflow of $73.1 million primarily attributable to net operating expenses, including discretionary bonuses paid during the period, offset by cash collected from clients. Investing activities resulted in a net inflow of $140.0 million primarily attributable to net sales of investments. Financing activities resulted in a net outflow of $108.5 million primarily related to the payment of dividends and tax distributions and treasury stock purchases.

Contractual Obligations

As of March 31, 2021, the Company has a total payable of $324.1 million due pursuant to the tax receivable agreement in the consolidated financial statements and of this amount an estimated $2.8 million will be due in less than one year. These amounts represent management’s best estimate of the amounts currently expected to be owed under the tax receivable agreement. Payments made under the tax receivable agreement are required to be made within 225 days of the filing of our tax returns. We generally expect to receive the tax savings prior to making the cash payments to the eligible selling holders of Group LP partnership units, we do not expect the cash payments to have a material impact on our liquidity. There were no payments made pursuant to the tax receivable agreement during the first three months of 2021.

Additionally, the Company has contractual obligations related to its leases for corporate office space and an aircraft. Please see Note 11 to the condensed consolidated financial statements for details regarding when these obligations are due.

Market Risk and Credit Risk

Our business is not capital-intensive and we do not invest in derivative instruments or, generally, borrow through issuing debt. As a result, we are not subject to significant market risk (including interest rate risk, foreign currency exchange rate risk and commodity price risk) or credit risk.

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Risks Related to Cash and Short-Term Investments

Our cash and cash equivalents include all short-term highly liquid investments that are readily convertible to known amounts of cash and have original maturities of three months or less from the date of purchase. We invest most of our cash in highly-rated municipal bonds, U.S. government agency debt securities and U.S. treasury instruments. Cash is maintained in U.S. and non-U.S. bank accounts. Most U.S. and U.K. account balances exceed the FDIC and FSCS coverage limits. In addition to cash and cash equivalents, we hold various types of U.S. treasury instruments that are classified as investments on our condensed consolidated statement of financial condition as they have original maturities of three months or more (but less than twelve months) from the date of purchase. We believe our cash and short-term investments are not subject to any material interest rate risk, equity price risk, credit risk or other market risk.

Credit Risk

We regularly review our accounts receivable and allowance for credit losses by considering factors such as historical experience, credit quality, age of the accounts receivable, and the current economic conditions that may affect a customer’s ability to pay such amounts owed to the Company. We maintain an allowance for credit losses that, in our opinion, provides for an adequate reserve to cover losses that may be incurred. See “—Critical Accounting Policies—Accounts Receivable and Allowance for Credit Losses.”

Exchange Rate Risk

The Company is exposed to the risk that the exchange rate of the U.S. dollar relative to other currencies may have an adverse effect on the reported value of the Company’s non‑U.S. dollar denominated assets and liabilities. Non‑functional currency‑related transaction gains and losses are recorded in the condensed consolidated statements of operations. In addition, the reported amounts of our revenues and other income from investments may be affected by movements in the rate of exchange between the pound sterling, euro, Brazilian real, Hong Kong dollar, rupee, Australian dollar, and the U.S. dollar, in which our financial statements are denominated. For the three months ended March 31, 2021 and 2020, the net impact of the fluctuation of foreign currencies in other comprehensive income (loss) in the condensed statements of comprehensive income were losses of $0.7 million and $1.6 million, respectively. We have not entered into any transactions to hedge our exposure to these foreign currency fluctuations through the use of derivative instruments or other methods.

Critical Accounting Policies

We believe that the critical accounting policies included below represent those that are most important to the presentation of our financial condition and results of operations and require management’s most difficult, subjective and complex judgment.

The preparation of financial statements and related disclosures in conformity with U.S. GAAP requires management to make estimates and assumptions 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. Actual results could differ from those estimates. Estimates and assumptions are reviewed periodically, and the effects of revisions are reflected in the period for which they are determined to be necessary.

All intercompany balances and transactions within the Company have been eliminated.

Revenue and Expense Recognition

We earn substantially all of our revenues from advisory engagements, and, in many cases, we are not paid until the completion of an underlying transaction. The Company recognizes revenues from providing advisory services when or as our obligations are fulfilled and collection is reasonably assured. The vast majority of our advisory revenues, which include reimbursements for certain out-of-pocket expenses, are recognized over time; however, a small number of transactions may be recognized at a point in time. We provide our advisory service on an ongoing basis which, for example, may include evaluating and selecting one of multiple strategies. During such engagements, our clients are continuously benefitting from our counsel and the over time recognition matches the transfer of such benefits. However, the recognition of transaction fees is constrained until substantially all services have been provided, specified conditions have been met and it is probable that a significant reversal of revenue will not occur in a future period. Upfront fees and retainers specified in our engagement letters that meet the over time criteria will be recognized on a systematic basis over the estimated period where the related services are performed. Revenues may be recognized at a point in time if the engagement represents a singular objective that does not transfer any notable value until formally completed, such as when issuing a fairness opinion. In these instances, the point in time recognition appropriately matches the transfer and consumption of our services.

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Incremental costs of obtaining a contract are expensed as incurred since such costs are generally not recoverable and the typical duration of our advisory contracts is less than one year. Costs to fulfill contracts consist of out-of-pocket expenses that are part of performing our advisory services and are typically expensed as incurred, except where the transfer and consumption of our services occurs at a point in time. For engagements recognized at a point in time, out-of-pocket expenses are capitalized and subsequently expensed in the condensed consolidated statement of operations upon completion of the engagement. The Company records deferred revenues when it receives fees from clients that have not yet been earned (e.g. an upfront fee) or when the Company has an unconditional right to consideration before all performance obligations are complete (e.g. upon satisfying conditions to earn an announcement fee, but before the transaction is consummated).

Accounts Receivable and Allowance for Credit Losses

The accompanying condensed consolidated statements of financial condition present accounts receivable balances net of allowance for credit losses based on the Company’s assessment of the collectability of customer accounts.

The Company maintains an allowance for credit losses that, in management’s opinion, provides for an adequate reserve to cover losses that may be incurred. For purposes of determining appropriate allowances, the Company stratifies its population of accounts receivable into two categories, one for short-term receivables and a second for private funds advisory receivables. Each population is separately evaluated using an aging method that results in a percentage reserve based on the age of the receivable, in addition to considerations of historical charge-offs and current economic conditions.

After concluding that a reserved accounts receivable is no longer collectible, the Company will charge-off the receivable. This has the effect of reducing both the gross receivable and the allowance for credit losses. If a reserved accounts receivable is subsequently collected, such recoveries reduce the gross receivable and the allowance for credit losses and is a reduction of bad debt expense, which is recorded within other expenses on the condensed consolidated statement of operations. The combination of recoveries and the provision for credit losses of a reported period comprise the Company’s bad debt expense.

Income Taxes

The Company accounts for income taxes in accordance with ASC 740, “ Accounting for Income Taxes ” (“ASC 740”), which requires the recognition of tax benefits or expenses on temporary differences between the financial reporting and tax bases of its assets and liabilities by applying the enacted tax rates in effect for the year in which the differences are expected to reverse. Such net tax effects on temporary differences are reflected on the Company’s condensed consolidated statements of financial condition as deferred tax assets. Deferred tax assets are reduced by a valuation allowance when the Company believes that it is more-likely-than-not that some portion or all of the deferred tax assets will not be realized.

ASC 740 prescribes a two-step approach for the recognition and measurement of tax benefits associated with the positions taken or expected to be taken in a tax return that affect amounts reported in the financial statements. The Company has reviewed and will continue to review the conclusions reached regarding uncertain tax positions, which may be subject to review and adjustment at a later date based on ongoing analyses of tax laws, regulations and interpretations thereof. For the three months ended March 31, 2021 and 2020, no unrecognized tax benefit was recorded. To the extent that the Company’s assessment of the conclusions reached regarding uncertain tax positions changes as a result of the evaluation of new information, such change in estimate will be recorded in the period in which such determination is made. The Company reports income tax related interest and penalties relating to uncertain tax positions, if applicable, as a component of income tax expense. For the three months ended March 31, 2021 and 2020, no such amounts were recorded.

Leases

The Company maintains operating leases for corporate offices and an aircraft. The Company determines if a contract contains a lease at inception. Operating leases are recorded as right-of-use (“ROU”) assets and lease liabilities on the condensed consolidated statements of financial condition. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease liabilities are recognized at the lease commencement date and are measured at the present value of anticipated lease payments over the lease term. The operating lease ROU assets are equal to the lease liabilities, adjusted for certain lease incentives, accrued rents, and prepaid rents. Typically, our borrowing rate is used to determine the present value of lease payments because the implicit rate is not readily determinable. Our lease terms may include options to extend or terminate the lease. These options are factored into our present value calculations when it is reasonably certain that such options will be exercised. Operating lease expense is recognized on a straight-line basis over the lease term.

Recent Accounting Developments

For a discussion of recently issued accounting developments and their impact or potential impact on our financial statements, see Note 3—Recent Accounting Pronouncements, of the condensed consolidated financial statements included in this Form 10-Q.

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Item 3.  Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative disclosures about market risk are set forth above in “Item 2—Management’s Discussion and Analysis of Financial Condition and Results of Operations—Market Risk and Credit Risk.”

Item 4.  Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of the Company’s disclosure controls and procedures (as defined in rule 13a-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)). Based upon this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of the end of the period covered by this report.

Changes in Internal Controls

No change in our internal control over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) of the Exchange Act) occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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PART II. OTHER INFORMATION

Item 1.  Legal Proceedings

In the ordinary course of business, from time to time the Company and its affiliates are involved in judicial or regulatory proceedings, arbitration or mediation concerning matters arising in connection with the conduct of its businesses, including contractual and employment matters. In addition, government agencies and self-regulatory organizations conduct periodic examinations and initiate administrative proceedings regarding the Company’s business, including, among other matters, compliance, accounting and operational matters, that can result in censure, fine, the issuance of cease-and-desist orders or the suspension or expulsion of a broker-dealer, investment advisor, or its directors, officers or employees. In view of the inherent difficulty of determining whether any loss in connection with such matters is probable and whether the amount of such loss can be reasonably estimated, particularly in cases where claimants seek substantial or indeterminate damages or where investigations and proceedings are in the early stages, the Company cannot estimate the amount of such loss or range of loss, if any, related to such matters, how or if such matters will be resolved, when they will ultimately be resolved, or what the eventual settlement, fine, penalty or other relief, if any, might be. Subject to the foregoing, the Company believes, based on current knowledge and after consultation with counsel, that it is not currently party to any material pending proceedings, individually or in the aggregate, the resolution of which would have a material effect on the Company.

Item 1A.  Risk Factors

There have been no material changes to the Risk Factors described in Part I "Item 1A. Risk Factors" in the Company's Annual Report on Form 10-K for the year ended December 31, 2020 as filed with the Securities and Exchange Commission ("SEC").

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Unregistered Sales

None.

Issuer Purchases of Equity Securities

							Approximate Dollar
							Value of Shares
					Shares Purchased		that May Yet be
	Total Number				as Part of Publicly		Purchased Under
	of Shares		Average Price		Announced Plans		the Plan
Period	Purchased(1)		Paid per Share		or Programs(2)		Or Programs(2)
January 1 - January 31		—	$	—		—	$	75.2 million
February 1 - February 28		1,279,818		54.42		29,938		73.6 million
March 1 - March 31		84,116		54.22		—		73.6 million
Total		1,363,934	$	54.41		29,938	$	73.6 million

(1) Includes treasury transactions arising from net settlement of equity awards to satisfy minimum tax obligations.

(2) In February 2019, the Board of Directors authorized the repurchase of up to $100 million of shares of Class A common stock and/or Class A partnership units of Group LP with no expiration date. Under this share repurchase program, shares may be repurchased from time to time in open market transactions, in privately negotiated transactions or otherwise. The timing and the actual number of shares repurchased will be opportunistic and measured in nature and will depend on a variety of factors, including price and market conditions.

Item 3.  Defaults Upon Senior Securities

None.

Item 4.  Mine Safety Disclosures

Not applicable.

Item 5.  Other Information

None.

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Item 6.  Exhibits

Exhibit Number	Description
3.1	Amended and Restated Certificate of Incorporation of the Registrant (incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on April 22, 2014)
3.2	Amended and Restated Bylaws of the Registrant (incorporated by reference to Exhibit 3.2 to the Registrant’s Current Report on Form 8-K filed with the SEC on April 22, 2014)
10.1	Master Services Agreement, dated April 28, 2021 by and between Moelis & Company Group LP, Moelis Asset Management LP and certain subsidiaries of Moelis Asset Management LP
31.1	Rule 13a-14(a) Certification of Chief Executive Officer of the Registrant in accordance with Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Rule 13a-14(a) Certification of Chief Financial Officer of the Registrant in accordance with Section 302 of the Sarbanes-Oxley Act of 2002
32.1*	Section 1350 Certification of Chief Executive Officer of the Registrant in accordance with Section 906 of the Sarbanes-Oxley Act of 2002
32.2*	Section 1350 Certification of Chief Financial Officer of the Registrant in accordance with Section 906 of the Sarbanes-Oxley Act of 2002
101.INS	Inline XBRL Instance Document
101.SCH	Inline XBRL Taxonomy Extension Schema
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase
104	Cover Page Interactive Data File (formatted as inline XBRL and contained Exhibit 101)

* Document has been furnished, is not deemed filed and is not to be incorporated by reference into any of the Registrant’s filings under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934 irrespective of any general incorporation language contained in any such filing.

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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 this 29^th day of April, 2021.

MOELIS & COMPANY

/s/ Kenneth Moelis

Kenneth Moelis

Chief Executive Officer

/s/ Joseph Simon

Joseph Simon

Chief Financial Officer

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EX-10.1

Exhibit 10.1

MASTER SERVICES AGREEMENT

This SERVICES AGREEMENT, dated as of April 28, 2021 is made by and between MOELIS & COMPANY GROUP LP, a Delaware limited partnership (“Advisory”), and MOELIS ASSET MANAGEMENT LP, a Delaware limited partnership (“Asset Management”) and each of the following subsidiaries of Asset Management: P&S CREDIT MANAGEMENT, L.P., a Delaware limited partnership (“Gracie”), FREEPORT FINANCIAL PARTNERS LLC, a Delaware limited liability company (“Freeport”) and STEELE CREEK INVESTMENT MANAGEMENT LLC, a Delaware limited liability company (“Steele Creek”).

RECITALS

A. Each of the Advisory and Asset Management were operated as businesses under Moelis Asset Management LP (formerly named Moelis & Company Holdings LP), prior to the initial public offering of Advisory.

B. Advisory currently maintains certain staff and services which each of Asset Management, Gracie, Freeport and Steele Creek utilizes in the course of their respective business.

C. Asset Management and Advisory each desire that Advisory shall henceforth provide the Asset Management Services (as defined below) to each of Asset Management, Gracie, Freeport and Steele Creek on the terms of and in accordance with this agreement.

D. The parties additionally desire that this agreement govern any provision of services from Asset Management to Advisory.

AGREEMENT

The parties to this agreement, in exchange for the mutual promises made herein and intending to be legally bound hereby, agree as follows:

ARTICLE 1.

SERVICES TO BE PROVIDED

1.1Description of Services.  During the term of this agreement, Advisory will provide to Asset Management the services (the “Asset Management Services”) described on Schedule A-1 attached hereto (as the same may be amended from time to time, “Schedule A-1”).  During the term of this agreement, Asset Management will provide to Advisory the services (the “Advisory Services”, and together with the Asset Management Services, the “Services”) described on Schedule A-2 attached hereto (as the same may be amended from time to time, “Schedule A-2”).  Any entity receiving Services hereunder shall be referred to as a “Recipient” and any entity providing Services hereunder shall be referred to as a “Provider” as applicable. Additionally, Advisory will sublet certain office space to Asset Management as set forth on Schedule A-3 attached hereto. Each of Schedule A-1, Schedule A-2 and Schedule A-3 may be amended as set forth in Section 6.5 below.  

1.2Personnel.

(a)The Services to be provided by a Provider to a Recipient shall be provided by employees of such Provider or by service providers to such Provider, as applicable. In the event that any employees of a Provider as of the date of this agreementcease to be employed by such Provider, the Provider will have no obligation to hire a new employee for the purpose of providing the Services to the applicable Recipient and will not be liable for any losses, costs or damages caused by, attributable to or arising in connection with (A) such Recipient’s failure to receive such Services, or (B) such Recipient’s transition from the Services to any replacement services.

(b)Each entity acting as a Provider shall be responsible for the payment of all wages and federal, state and local taxes and withholdings payable with respect to the wages of such persons, shall maintain workers’ compensation insurance required by applicable statutes with respect to such persons and shall maintain and provide all applicable employee benefits for such persons.  No person providing Services to a Recipient shall be considered an employee of the Recipient because of the provision of such Services.

1.3Compensation.  Each Recipient shall pay each Provider a fee as set forth in Schedule B attached hereto as the total consideration for the Services to be provided to such Recipient during the term of this agreement and such Recipient shall not pay any additional fee or other compensation for such Services, unless the scope of those Services is expanded by mutual agreement of the parties and the parties agree that additional compensation should be paid in connection therewith. In the event Services are discontinued, fees for such Service will be prorated through date of termination. Asset Management may pay to Advisory the fees due on behalf of its subsidiaries.

1.4Warranty Disclaimer.  NO PROVIDER MAKES ANY EXPRESS OR IMPLIED REPRESENTATIONS OR WARRANTIES, INCLUDING, WITHOUT LIMITATION, THE WARRANTIES IMPLIED BY LAW OR MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, REGARDING THIS AGREEMENT, OR THE PERFORMANCE OF THE SERVICES CONTEMPLATED BY THIS AGREEMENT.

1.5Limitation of Liability.  No Provider will be liable to any Recipient or to any other person or entity for any losses, costs or damages caused by, attributable to or arising in connection with the performance, nonperformance or delayed performance of the Services to be provided to such Recipient contemplated by this agreement, except for such losses, costs or damages attributable to such Provider’s bad faith, gross negligence or willful misconduct for which damages the Provider will be liable.  Notwithstanding the foregoing, no Provider shall be liable for any special, indirect, consequential or punitive damages in connection with the Services to any Recipient even if the Provider has been advised of the possibility of such damages.  No Provider will be liable for any failure to perform or any delay in the performance of its obligations hereunder due to Force Majeure (as hereinafter defined).

1.6Consents.  Notwithstanding any provision of this agreement to the contrary, if the provision of any Service as contemplated by this agreement requires the consent, approval or authorization of any third party, the Provider providing such Service shall use its commercially reasonable efforts to obtain as promptly as possible after the date of this agreement such consent, approval or authorization (including obtaining from third party vendors all consents necessary to grant any sublicenses in connection with the performance of such Service) and shall be excused from performing such Service while it continues to use such commercially reasonable efforts.  Any fee, cost or expense incurred in connection with obtaining such consent, approval or authorization shall be paid by the Provider.  If any such consent, approval or authorization is not obtained promptly after the date of this agreement, the Provider shall notify the

2

applicable Recipient and the parties shall cooperate in good faith to devise an alternative arrangement to the provision of such Service, which alternative arrangement shall be reasonably satisfactory to each party.  

ARTICLE 2.

TERM AND TERMINATION

2.1Term.  The effective date of this agreement is April 1, 2021 and will continue until the one year anniversary thereof, subject to earlier termination as provided in Section 2.2 hereof or extension by mutual agreement.

2.2Termination.  This agreement may be terminated in accordance with the following provisions:

(a)Any party may terminate this agreement solely as it applies to services provided or received between itself and another party by giving notice in writing to such other party should an event of Force Majeure (as defined in Section 3.1) continue for more than ninety (90) consecutive calendar days;

(b)Any party may terminate this agreement solely as it applies to services provided or received between itself and another party by giving notice in writing to the other party in the event such other party is in material breach of this agreement and shall have failed to cure such breach within thirty (30) calendar days of receipt of written notice thereof from the non-breaching party;

(c)Any party may terminate this agreement solely as it applies to services provided or received between itself and another party by giving ninety (90) calendar days written notice to such other party; or

(d)Any two parties hereto may terminate this agreement solely as it applies to services provided or received between such parties with the mutual written consent of such parties.

2.3Rights and Obligations on Termination.  In the event of the termination of this agreement pursuant to Section 2.2, solely as it applies to services provided or received between such parties, a Provider will have the right to terminate any or all Services provided to a Recipient.  Such Recipient shall bear sole responsibility for obtaining replacement services, and such Provider shall bear no liability for such Recipient’s failure to obtain such service or for any difficulties in transitioning from the Services to such replacement service.

ARTICLE 3.

FORCE MAJEURE

3.1Definition.  “Force Majeure” means any event or condition, not existing as of the date of this agreement and not reasonably within the control of either party, which prevents in whole or in material part the performance by a Provider of its obligations hereunder or which renders the performance of such obligations so difficult or costly as to make such performance commercially unreasonable.  Without limiting the foregoing, the following, without limitation, will constitute events or conditions of Force Majeure: acts of state or governmental action, riots, disturbance, war, acts of terrorism, strikes, labor slowdowns,

3

prolonged shortage of energy supplies, epidemics, fire, flood, hurricane, typhoon, earthquake and explosion.

3.2Notice.  Upon giving written notice to a Recipient, the Provider being affected by an event of Force Majeure will be released without any liability on its part from the performance of its obligations under this agreement, but, subject to Section 2.2, only to the extent and only for the period that its performance of such obligations is prevented by the event of Force Majeure.  Such notice must include a description of the nature of the event of Force Majeure, its cause and to the extent known its likely consequences.  Such Provider will promptly notify the applicable Recipient of the termination of such event.

ARTICLE 4.

INDEMNIFICATION

Each Recipient severally and not jointly agrees to protect, defend, hold harmless and indemnify each Provider severally and not jointly and its successors, assigns, directors, officers, members, employees and agents (collectively, the “Provider Representatives”), from and against any and all claims, demands, actions, liabilities, damages, losses, fines, penalties, costs and expenses, including reasonable attorneys’ fees (collectively referred to as “Claims”), actually or allegedly, directly or indirectly, arising out of or related to any actions taken or omitted to be taken by such Provider or any of such Provider Representatives in connection with the performance of any of the Services to be provided by such Provider to such Recipient hereunder, other than Claims that are the direct result of bad faith, gross negligence or willful misconduct of such Provider or such Provider’s Representative.  Notwithstanding the foregoing, no Recipient shall be liable for any special, indirect, consequential or punitive damages in connection with any Claim even if such Recipient has been advised of the possibility of such damages.  

ARTICLE 5.

CONFIDENTIALITY

5.1Definition. In connection with the Services to be performed hereunder, a Recipient may provide to a Provider information about it, the funds, accounts or clients to which such Recipient provides investment management or advisory services, as applicable, their investors or other third parties that is confidential or proprietary in nature (the “Confidential Information”), which may include, but is not limited to, information of a technical, administrative and/or financial nature relating to the business operations of such Recipient.  The Recipient shall, except to the extent necessary for the Services, not disclose to the Provider Confidential Information about any issuer of securities to the public in the United States. Notwithstanding the foregoing, with respect to any Provider, Confidential Information shall not include information that: (a) has come into the public domain through no breach of this Article 5 by such Provider or any related Provider Representative; (b) is or becomes available to such Provider from any third party not known to be breaching an obligation of confidentiality to the Recipient; or (c) is independently developed by such Provider without reference to or use of the Confidential Information of the Recipient.

5.2Use and Protection of Confidential Information. Each Provider severally and not jointly, on behalf of itself and its Provider Representatives, agrees that the Confidential Information shall be kept confidential and, except with the prior written consent of the applicable Recipient, shall not disclose to any third party, including to any other Recipient, any of the Confidential Information disclosed to such Provider or any Provider Representative hereunder in any manner whatsoever, except as needed to Provider

4

Representatives who are subject to confidentiality obligations substantially similar to those set forth herein and who have a reasonable need to know such Confidential Information in order to provide the Services under this agreement.  This Article 5 shall terminate as between any two parties two years following termination of this agreement between such two parties.  

5.3Legally Compelled or Requested Disclosure.  If a Provider or a Provider Representative is requested or required (in either case by oral questions, interrogatories, requests for information or documents, subpoena, civil investigative demand or similar process) to disclose any Confidential Information, such Provider agrees to the extent permissible to provide the applicable Recipient with prompt notice of each such request, to the extent practicable, so that the Recipient may seek an appropriate protective order or waive such Provider’s compliance with the provisions of this agreement.  If, absent the entry of a protective order or the receipt of a waiver under this agreement, any Provider or its Provider Representative, as the case may be, on the advice of its counsel, is legally compelled to disclose such information, such Provider or Provider Representative, as the case may be, may disclose such information to the persons and to the extent required without liability under this agreement, and the Provider agrees to cooperate with the Recipient’s efforts to obtain reliable assurances that confidential treatment will be accorded any Confidential Information so furnished.  For the avoidance of doubt, the immediately preceding sentence shall not require any Provider to take any action that would cause it to incur more than de minimis cost or expense unless the applicable Recipient agrees to advance or reimburse the Provider for such cost and expense.  In addition, a Provider may also disclose its business records (including documents including Confidential Information) to its financial regulatory authorities without notice to the Recipient in connection with customary examinations and inquiries with respect to its business.

5.4Return or Destruction of Confidential Information. Upon demand by a Recipient at any time, or upon expiration or termination of this agreement with respect to the Services, the applicable Provider agrees promptly to, and to cause each of its Provider Representatives to, return or destroy, at the Recipient’s option, all Confidential Information, provided that the Provider may maintain such Confidential Information in accordance with its internal document retention policies.

ARTICLE 6.

MISCELLANEOUS

6.1Notices.  All notices, requests, claims, demands and other communications hereunder shall be in writing and shall be given or made (and shall be deemed to have been duly given or made when delivered in person or when transmitted by facsimile, or one business day after having been dispatched by a nationally recognized overnight courier service to the respective parties at the following addresses (or at such other address for a party as shall be specified in a notice given in accordance with this Section 6.1):

If to Advisory, addressed to:

Moelis & Company Group LP

399 Park Avenue, 5^th Floor

New York, NY  10022-8604

Attention:  Osamu Watanabe

Email: osamu.watanabe@moelis.com

If to Gracie, addressed to:

5

P&S Credit Management, L.P.

757 Third Avenue, 7^th Floor

New York, NY 10017

Attention:  Sam Konz

Email: konz@graciecap.com

If to Freeport, addressed to:

Freeport Financial Partners LLC

200 South Wacker Drive, Suite 750

Chicago, IL  60606

Attention:  Joseph Walker

Email: jvwalker@freeportfinancial.com

If to Steele Creek, addressed to:

Steele Creek Investment Management LLC

201 S. College Street, Suite 1690

Charlotte, North Carolina 28244

Attention:  Glenn Duffy

Email: glenn.duffy@steelecreek.com

If to Asset Management, addressed to:

Moelis Asset Management LP

112W 34th Street, 17th Floor

New York, NY 10001

Attention:  Marie Bober

Email: Marie.Bober@moelisam.com

6.2Independent Contracting Parties.  The parties hereto expressly acknowledge that no employment, partnership or joint venture relationship is created by this agreement, and hereby agree as follows:

(a)Each party at all times during the term of this agreement shall be an independent contracting party;

(b)For purposes of the Services to be performed under this agreement, except in the case of dual employees of Advisory and Asset Management, no Provider nor anyone employed by or acting for or on behalf of any Provider shall be construed as an employee of any Recipient, and no Recipient shall be liable for employment or withholding taxes respecting any Provider or any employee of any Provider, or any employee benefits therefor.

6.3Cooperation.  The parties will each use good faith efforts to reasonably cooperate with each other in all matters relating to the provision and receipt of the Services.  Such cooperation shall include the applicable Recipient obtaining all Recipient-required consents, licenses or approvals necessary to permit a Provider to perform its obligations hereunder; Recipient agrees to reasonably cooperate with assisting the Provider obtaining all Provider-required consents, licenses or approvals.  The parties will, for a period of

6

five (5) years after the termination of this agreement, maintain information relating to the Services and cooperate with each other in making such information available as needed, subject to appropriate confidentiality requirements, in the event of any audit, investigation or litigation.

6.4Assignment.  No party has the right to, directly or indirectly, in whole or in part, assign, delegate, convey or otherwise transfer, whether voluntarily, involuntarily or by operation of law, its rights and obligations under this agreement, except with the prior written approval of the other party or parties as applicable. Notwithstanding the foregoing, any party may assign, delegate, convey or otherwise transfer its own rights and obligations under this agreement without obtaining the prior written approval of any other party to a successor by merger, consolidation or similar business combination or to a purchaser in connection with the sale of all or substantially all of such party’s assets.  Any action prohibited by this Section 6.4 will be null and void.

6.5Amendment; Waiver.  Neither this agreement nor any provision hereof may be modified, amended, rescinded, canceled or waived, in whole or in part, except by a written instrument duly executed by the applicable parties hereto.  No failure or delay by a party to take any action or assert any right or remedy hereunder or to enforce strict compliance with any provision hereof will be deemed to be a waiver of, or estoppel with respect to, such right, remedy or noncompliance in the event of the continuation or repetition of the circumstances giving rise to such right, remedy or noncompliance.  No waiver shall be effective unless given in a duly executed written instrument.

6.6Survival of Provisions.  The rights, remedies, agreements, obligations and covenants of each of the parties contained in or made pursuant to this agreement which by their terms extend beyond the termination of this agreement, including, without limitation, Article 4 (relating to indemnification) and Article 5 (relating to confidentiality), will survive the termination of this agreement and will remain in full force and effect.

6.7Severability.  Any term or provision of this agreement that is held by a court of competent jurisdiction to be invalid, void or unenforceable in any situation in any jurisdiction shall not affect the validity or enforceability of the remaining terms and provisions hereof or the validity or enforceability of the offending term or provision in any other situation or in any other jurisdiction.  If the final judgment of a court of competent jurisdiction declares that any term or provision hereof is invalid, void or unenforceable, the parties hereto agree that the court making such determination, to the greatest extent legally permissible, shall have the power to reduce or alter the term or provision, to delete specific words or phrases, or to replace any invalid, void or unenforceable term or provision with a term or provision that is valid and enforceable and that comes closest to expressing the intent of the invalid, void or unenforceable term or provision.

6.8Entire Agreement.  This agreement and the Schedules hereto constitute the entire agreement of the parties hereto with respect to the subject matter hereof and supersede all prior agreements and undertakings, both written and oral, by and among the parties with respect to the subject matter hereof.  

6.9Governing Law; Non-Binding Mediation; Jurisdiction.  This agreement shall be governed by, and construed in accordance with, the laws of the State of New York (without regard to the laws of conflict of any jurisdiction).  Any dispute, controversy or claim arising out of or in connection with this Agreement, or the interpretation, breach, termination or validity thereof (“Dispute”) shall be finally resolved by arbitration in accordance with the Commercial Arbitration Rules of the American Arbitration Association (“AAA”) then in effect (the “Rules”), except as modified herein and such arbitration shall be

7

administered by the AAA.  The place of arbitration shall be New York, New York.  There shall be one arbitrator who shall be agreed upon by the parties within twenty (20) days of receipt by respondent of a copy of the demand for arbitration.  If any arbitrator is not appointed within the time limit provided herein, such arbitrator shall be appointed by the AAA in accordance with the listing, striking and ranking procedure in the Rules, with each party being given a limited number of strikes, except for cause.  Any arbitrator appointed by the AAA shall be a retired judge or a practicing attorney with no less than fifteen years of experience with corporate and financial matters and an experienced arbitrator.  In rendering an award, the arbitrator shall be required to follow the laws of the state of New York.  The award shall be in writing and shall briefly state the findings of fact and conclusions of law on which it is based.  The arbitrator shall not be permitted to award punitive, multiple or other non-compensatory damages.  The award shall be final and binding upon the parties and shall be the sole and exclusive remedy between the parties regarding any claims, counterclaims, issues or accounting presented to the arbitrator.  Judgment upon the award may be entered in any court having jurisdiction over any party or any of its assets.  Any costs or fees (including attorneys’ fees and expenses) incident to enforcing the award shall be charged against the party resisting such enforcement.  All Disputes shall be resolved in a confidential manner.  The arbitrator shall agree to hold any information received during the arbitration in the strictest of confidence and shall not disclose to any non-party the existence, contents or results of the arbitration or any other information about such arbitration.  The parties to the arbitration shall not disclose any information about the evidence adduced or the documents produced by the other party in the arbitration proceedings or about the existence, contents or results of the proceeding except as may be required by law, regulatory or governmental authority or as may be necessary in an action in aid of arbitration or for enforcement of an arbitral award.  Before making any disclosure permitted by the preceding sentence (other than private disclosure to financial regulatory authorities), the party intending to make such disclosure shall use reasonable efforts to give the other party reasonable written notice of the intended disclosure and afford the other party a reasonable opportunity to protect its interests.  Barring extraordinary circumstances (as determined in the sole discretion of the arbitrator), discovery shall be limited to pre-hearing disclosure of documents that each side will present in support of its case, and non-privileged documents essential to a matter of import in the proceeding for which a party has demonstrated a substantial need. The parties agree that they will produce to each other all such requested non-privileged documents, except documents objected to and with respect to which a ruling has been or shall be sought from the arbitrator. There will be no depositions.

6.10Counterparts; Headings.  This agreement may be executed and delivered (including by facsimile or PDF transmission) in one or more counterparts, and by the different parties in separate counterparts, each of which when executed shall be deemed to be an original, but all of which taken together shall constitute one and the same agreement.  The headings of the sections and articles of this agreement are inserted for convenience only and do not constitute a substantive part hereof.

[The remainder of this page is intentionally left blank.]

8

IN WITNESS WHEREOF, the parties have caused this agreement to be duly executed by their authorized representatives as of the date first above written.

MOELIS & COMPANY GROUP LP

a Delaware limited partnership

By:Moelis & Company Group GP LLC, its General Partner

By: /s/ Osamu WatanabeBy:

Name:Osamu Watanabe

Title: General Counsel

P&S CREDIT MANAGEMENT L.P., a Delaware limited partnership By:P&S Credit Partners, LLC, its General Partner	FREEPORT FINANCIAL PARTNERS LLC a Delaware limited liability company
By: /s/ James PalmiscianoBy: Name:  James Palmisciano Title:  Chief Investment Officer	By: /s/ Joseph WalkerBy: Name: Joseph Walker Title: Managing Director

STEELE CREEK INVESTMENT MANAGEMENT LLC, a Delaware limited liability company	MOELIS ASSET MANAGEMENT LP, a Delaware limited partnership
By: /s/ Glenn DuffyBy: Name:Glenn Duffy Title: Chief Investment Officer	By: /s/ Chris RyanBy: Name:  Chris Ryan Title: Managing Director

9

SCHEDULE A-1 – ADVISORY SERVICES PROVIDED

This Schedule A outlines the services to be provided by Advisory to the following Recipients during the term of the agreement.

1) Gracie Asset Management

• Management Infrastructure Support

o Human Capital Management

2) Freeport Financial

• Management Infrastructure Support

o Tax Compliance Support

o Human Capital Management

3) Steele Creek

• Management Infrastructure Support

o Tax Compliance Support

o Human Capital Management

4) Asset Management

• Management Infrastructure Support

o Tax Compliance Support

o Legal Support

o Human Capital Management

10

SCHEDULE A-2 –SERVICES PROVIDED BY ASSET MANAGEMENT TO ADVISORY

• General Management Support Services

SCHEDULE B – FEE METHODOLOGY

This Schedule B outlines the methodology used to determine the fees to be paid for Services provided during the term of the agreement.  

All fees are billed and payable quarterly in arrears. The fees for any calendar quarter during which the Provider is engaged in providing the Services for less than a full quarter shall be determined on a pro rata basis.  Recipient shall pay to Provider such fee in cash within ten days after the last business day of the calendar quarter.

		Gracie	Freeport	MAM	Steele Creek	Total Asset Management
Tax Compliance Support	Fixed quarterly fee based on estimated compensation of services for each business.
Legal Support	Fixed quarterly fee based on estimated compensation cost of services.
Human Capital Management	Fixed quarterly fee based on estimated compensation cost of services.  Allocated to each business based on headcount.

EX-31.1

Exhibit 31.1

CERTIFICATION PURSUANT TO

SECTION 302 OF THE SARBANES‑OXLEY ACT OF 2002

I, Kenneth Moelis, certify that:

1. I have reviewed this Quarterly Report on Form 10‑Q for the period ending March 31, 2021, of Moelis & Company as filed with the Securities and Exchange Commission on the date hereof;

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 and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a‑15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a‑15(f) and 15d‑15(f)) for the above 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 changes in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter 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 and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and to the audit committee of the registrant’s board of directors:

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.

April 29, 2021	/s/ Kenneth Moelis
	Kenneth Moelis
	Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION PURSUANT TO

SECTION 302 OF THE SARBANES‑OXLEY ACT OF 2002

I, Joseph Simon, certify that:

1. I have reviewed this Quarterly Report on Form 10‑Q for the period ending March 31, 2021, of Moelis & Company as filed with the Securities and Exchange Commission on the date hereof;

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 and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a‑15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a‑15(f) and 15d‑15(f)) for the above 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 changes in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter 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 and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and to the audit committee of the registrant’s board of directors:

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.

April 29, 2021	/s/ Joseph Simon
	Joseph Simon
	Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES‑OXLEY ACT OF 2002

Pursuant to 18 U.S.C. § 1350, adopted pursuant to Section 906 of the Sarbanes‑Oxley Act of 2002, Kenneth Moelis, Chief Executive Officer of Moelis & Company (the “Company”), certifies with respect to the Quarterly Report of the Company on Form 10‑Q for the quarterly period ended March 31, 2021 (the “Report”) that, to the best of his knowledge:

(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.

April 29, 2021	/s/ Kenneth Moelis
	Kenneth Moelis
	Chief Executive Officer

EX-32.2

Exhibit 32.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES‑OXLEY ACT OF 2002

Pursuant to 18 U.S.C. § 1350, adopted pursuant to Section 906 of the Sarbanes‑Oxley Act of 2002, Joseph Simon, Chief Financial Officer of Moelis & Company (the “Company”), certifies with respect to the Quarterly Report of the Company on Form 10‑Q for the quarterly period ended March 31, 2021 (the “Report”) that, to the best of his knowledge:

(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.

April 29, 2021	/s/ Joseph Simon
	Joseph Simon
	Chief Financial Officer

XML

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2021	Apr. 15, 2021
Entity Registrant Name	Moelis & Co
Entity Central Index Key	0001596967
Document Type	10-Q
Document Period End Date	Mar. 31, 2021
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Interactive Data Current	Yes
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	Q1
Trading Symbol	MC
Entity File Number	001-36418
Entity Tax Identification Number	46-4500216
Entity Address, Address Line One	399 Park Avenue
Entity Address, Address Line Two	5th Floor
Entity Address, City or Town	New York
Entity Address, State or Province	NY
Entity Address, Postal Zip Code	10022
City Area Code	212
Local Phone Number	883-3800
Title of 12(b) Security	Class A Common Stock
Security Exchange Name	NYSE
Entity Incorporation, State or Country Code	DE
Document Quarterly Report	true
Document Transition Report	false
Class A Common Stock
Entity Common Stock, Shares Outstanding		61,325,544
Class B Common Stock
Entity Common Stock, Shares Outstanding		4,899,457

XML

Condensed Consolidated Statements of Financial Condition - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Assets
Cash and cash equivalents	$ 155,402	$ 202,477
Restricted cash	1,081	807
Receivables:
Accounts receivable, net of allowance for credit losses of $6,183 and $3,775 as of March 31, 2021 and December 31, 2020, respectively	71,824	89,297
Accrued and other receivables	45,427	11,916
Total receivables	117,251	101,213
Deferred compensation	15,676	12,004
Investments	118,427	211,826
Right-of-use assets	171,857	177,069
Equipment and leasehold improvements, net	52,067	49,977
Deferred tax assets	423,281	424,345
Prepaid expenses and other assets	16,055	16,726
Total assets	1,071,097	1,196,444
Liabilities and Equity
Compensation payable	59,889	220,058
Accounts payable, accrued expenses and other liabilities	24,583	25,026
Amount due pursuant to tax receivable agreement	324,064	307,581
Deferred revenue	8,105	2,692
Lease liabilities	193,876	196,614
Total liabilities	610,517	751,971
Commitments and Contingencies (See Note 11)
Treasury stock, at cost; 5,323,017 and 3,959,083 shares as of March 31, 2021 and December 31, 2020, respectively	(226,381)	(152,170)
Additional paid-in-capital	1,101,205	1,052,322
Retained earnings (accumulated deficit)	(393,166)	(420,682)
Accumulated other comprehensive income (loss)	(856)	(201)
Total Moelis & Company equity	481,517	479,948
Noncontrolling interests	(20,937)	(35,475)
Total equity	460,580	444,473
Total liabilities and equity	1,071,097	1,196,444
Class A Common Stock
Liabilities and Equity
Common stock, par value $0.01 per share	666	620
Total equity	666	620
Class B Common Stock
Liabilities and Equity
Common stock, par value $0.01 per share	49	59
Total equity	$ 49	$ 59

XML

Condensed Consolidated Statements of Financial Condition (Parenthetical) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Accounts receivable, allowance for credit losses	$ 6,183	$ 3,775
Treasury stock, shares	5,323,017	3,959,083
Class A Common Stock
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	1,000,000,000	1,000,000,000
Common stock, shares issued	66,648,561	61,986,927
Common stock, shares outstanding	61,325,544	58,027,844
Treasury stock, shares	5,323,017	3,959,083
Class B Common Stock
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	1,000,000,000	1,000,000,000
Common stock, shares issued	4,899,457	5,948,750
Common stock, shares outstanding	4,899,457	5,948,750

XML

Condensed Consolidated Statements of Operations - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Revenues	$ 263,866	$ 153,706
Expenses
Compensation and benefits	156,499	95,120
Occupancy	7,695	7,231
Professional fees	5,999	4,236
Communication, technology and information services	8,659	8,392
Travel and related expenses	1,610	7,944
Depreciation and amortization	1,449	1,199
Other expenses	9,512	5,142
Total expenses	191,423	129,264
Operating income (loss)	72,443	24,442
Other income and (expenses)	3,179	(1,660)
Income (loss) before income taxes	75,622	22,782
Provision (benefit) for income taxes	(176)	(7,344)
Net income (loss)	75,798	30,126
Net income (loss) attributable to noncontrolling interests	9,269	4,996
Net income (loss) attributable to Moelis & Company	66,529	25,130
Class A Common Stock
Expenses
Net income (loss) attributable to Moelis & Company	$ 66,529	$ 25,130
Weighted-average shares of Class A common stock outstanding
Basic (in shares)	60,932,966	52,666,457
Diluted (in shares)	66,360,217	57,092,982
Net income (loss) per share attributable to holders of shares of Class A common stock
Basic (in dollars per share)	$ 1.09	$ 0.48
Diluted (in dollars per share)	$ 1.00	$ 0.44

XML

Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Statement Of Income And Comprehensive Income [Abstract]
Net income (loss)	$ 75,798	$ 30,126
Foreign currency translation adjustment, net of tax	(744)	(1,630)
Other comprehensive income (loss)	(744)	(1,630)
Comprehensive income (loss)	75,054	28,496
Less: Comprehensive income (loss) attributable to noncontrolling interests	9,180	4,670
Comprehensive income (loss) attributable to Moelis & Company	$ 65,874	$ 23,826

XML

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Cash flows from operating activities
Net income (loss)	$ 75,798	$ 30,126
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Bad debt expense	3,149	518
Depreciation and amortization	1,449	1,199
Equity-based compensation	50,963	38,255
Deferred tax provision	21,245	(6,723)
Other	(2,615)	2,099
Changes in assets and liabilities:
Accounts receivable	14,401	5,565
Accrued and other receivables	(32,589)	(1,899)
Prepaid expenses and other assets	(587)	117
Deferred compensation	(3,660)	(4,925)
Compensation payable	(160,178)	(150,260)
Accounts payable, accrued expenses and other liabilities	1,969	9,454
Deferred revenue	5,409	1,439
Dividends received	2,279	1,942
Net cash provided by (used in) operating activities	(22,967)	(73,093)
Cash flows from investing activities
Purchase of investments	(78,723)	(28,152)
Proceeds from sales of investments	173,046	181,249
Note payments received from employees	70
Purchase of equipment and leasehold improvements	(3,539)	(13,139)
Net cash provided by (used in) investing activities	90,854	139,958
Cash flows from financing activities
Dividends and distributions	(39,685)	(88,689)
Proceeds from exercise of stock options		11,819
Treasury stock purchases	(74,211)	(31,636)
Net cash provided by (used in) financing activities	(113,896)	(108,506)
Effect of exchange rate fluctuations on cash, cash equivalents, and restricted cash	(792)	(2,176)
Net increase (decrease) in cash, cash equivalents, and restricted cash	(46,801)	(43,817)
Cash, cash equivalents, and restricted cash, beginning of period	203,284	168,572
Cash, cash equivalents, and restricted cash, end of period	156,483	124,755
Cash paid during the period for:
Income taxes	1,913	1,560
Other non-cash activity
Cumulative effect adjustment upon adoption of ASU 2016-13		364
Dividend equivalents issued	5,131	12,125
Class A Partnership Units or other equity converted into Class A Common Stock	3,903	786
Forfeiture of fully-vested Group LP units or other equity units	$ 25	$ 96

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Condensed Consolidated Statements of Changes in Equity - USD ($) $ in Thousands	Total	Cumulative Effect Adjustment Upon Adoption	As Adjusted	Class A Common Stock	Class A Common Stock As Adjusted	Class B Common Stock	Class B Common Stock As Adjusted	Treasury Stock	Treasury Stock As Adjusted	Additional Paid-In Capital	Additional Paid-In Capital As Adjusted	Retained Earnings (Accumulated Deficit)	Retained Earnings (Accumulated Deficit) Cumulative Effect Adjustment Upon Adoption	Retained Earnings (Accumulated Deficit) As Adjusted	Accumulated Other Comprehensive Income (Loss)	Accumulated Other Comprehensive Income (Loss) As Adjusted	Noncontrolling Interests	Noncontrolling Interests As Adjusted
Balance at beginning of the period at Dec. 31, 2019	$ 393,827	$ (364)	$ 393,463	$ 528	$ 528	$ 104	$ 104	$ (107,836)	$ (107,836)	$ 872,791	$ 872,791	$ (324,192)	$ (364)	$ (324,556)	$ 1,432	$ 1,432	$ (49,000)	$ (49,000)
Balance at beginning of the period (in shares) at Dec. 31, 2019				52,773,617	52,773,617	10,397,915	10,397,915	(2,757,558)	(2,757,558)
Changes in Equity
Accounting Standards Update [Extensible List]		ASU 2016-13											ASU 2016-13
Net income (loss)	30,126											25,130					4,996
Equity-based compensation	38,255			$ 36						38,189							30
Equity-based compensation (in shares)				3,581,294
Other comprehensive income (loss)	(1,630)														(1,304)		(326)
Dividends declared tax distributions	(88,689)									12,125		(79,391)					(21,423)
Treasury Stock Purchases	$ (31,636)							$ (31,636)
Treasury stock purchases (in shares)	(869,779)							(869,779)
Exercise of Stock options	$ 11,819			$ 7						11,812
Exercise of stock options (in shares)				721,484
Equity-based payments to non-employees	158									158
Other	690									(1,981)							2,671
Balance at end of the period at Mar. 31, 2020	352,556			$ 571		$ 104		$ (139,472)		933,094		(378,817)			128		(63,052)
Balance at end of the period (in shares) at Mar. 31, 2020				57,076,395		10,397,915		(3,627,337)
Balance at beginning of the period at Dec. 31, 2020	444,473			$ 620		$ 59		$ (152,170)		1,052,322		(420,682)			(201)		(35,475)
Balance at beginning of the period (in shares) at Dec. 31, 2020				61,986,927		5,948,750		(3,959,083)
Changes in Equity
Net income (loss)	75,798											66,529					9,269
Equity-based compensation	50,963			$ 36						41,508							9,419
Equity-based compensation (in shares)				3,612,341
Other comprehensive income (loss)	(744)														(655)		(89)
Dividends declared tax distributions	(39,685)									5,131		(39,013)					(5,803)
Treasury Stock Purchases	$ (74,211)							$ (74,211)
Treasury stock purchases (in shares)	(1,363,934)							(1,363,934)
Equity-based payments to non-employees	$ 108									108
Issuance of Class A common stock and cancellation of Class B common stock in connection with offerings and other exchanges	3,903			$ 10		$ (10)				2,161							1,742
Issuance of Class A common stock and cancellation of Class B common stock in connection with offerings and other exchanges (in shares)				1,049,293		(1,049,293)
Other	(25)									(25)
Balance at end of the period at Mar. 31, 2021	$ 460,580			$ 666		$ 49		$ (226,381)		$ 1,101,205		$ (393,166)			$ (856)		$ (20,937)
Balance at end of the period (in shares) at Mar. 31, 2021				66,648,561		4,899,457		(5,323,017)

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Condensed Consolidated Statements of Changes in Equity (Parenthetical) - $ / shares	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Class A Common Stock
Dividends declared per share of Class A common stock	$ 0.55	$ 1.26

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Organization and Basis of Presentation

3 Months Ended

Mar. 31, 2021

Organization Consolidation And Presentation Of Financial Statements [Abstract]

Organization and Basis of Presentation

1. ORGANIZATION AND BASIS OF PRESENTATION

Moelis & Company and its consolidated subsidiaries (the “Company,” “we,” “our,” or “us”) is a leading global investment bank, incorporated in Delaware. Prior to the Company’s Initial Public Offering (“IPO”), the business operated as a Delaware limited partnership that commenced operations during 2007. Following the IPO, the operations are owned by Moelis & Company Group LP (“Group LP”), a U.S. Delaware limited partnership, and Group LP is controlled by Moelis & Company. Moelis & Company’s shareholders are entitled to receive a portion of Group LP’s economics through their direct ownership interests in shares of Class A common stock of Moelis & Company. The noncontrolling interest owners of Group LP (not Moelis & Company) receive economics of the operations primarily through their ownership interests in Group LP partnership units.

The Company’s activities as an investment banking advisory firm constitute a single business segment offering clients, including corporations, governments and financial sponsors, a range of advisory services with expertise across all major industries in mergers and acquisitions, recapitalizations and restructurings and other corporate finance matters.

Basis of Presentation —The condensed consolidated financial statements of Moelis & Company include its partnership interests in Group LP, its equity interest in the sole general partner of Group LP, Moelis & Company Group GP LLC (“Group GP”), and its interests in its subsidiaries. Moelis & Company will operate and control all of the business and affairs of Group LP and its operating entity subsidiaries indirectly through its equity interest in Group GP. The Company operates through the following subsidiaries:

• Moelis & Company LLC (“Moelis U.S.”), a Delaware limited liability company, a registered broker-dealer with the U.S. Securities and Exchange Commission (“SEC”) and a member of the Financial Industry Regulatory Authority, Inc. (“FINRA”).

• Moelis & Company Israel Ltd., a limited company incorporated in Israel.

• Moelis & Company International Holdings LLC (“Moelis International”), a Delaware limited liability company, owns the following entities and investments, directly or indirectly:

• Moelis & Company UK LLP (“Moelis UK”), a limited liability partnership registered under the laws of England and Wales. In addition to the United Kingdom, Moelis UK maintains operations through the following branches:

• Moelis & Company Europe Limited, Frankfurt am Main Branch (German branch)

• Moelis & Company UK LLP, DIFC Branch (Dubai branch)

• Moelis & Company Asia Limited (“Moelis Asia”), a limited company incorporated in Hong Kong licensed under the Hong Kong Securities and Futures Ordinance to provide financial advisory services. In addition to Hong Kong, Moelis Asia maintains operations in Beijing, China through a wholly-owned Chinese subsidiary, Moelis & Company Consulting (Beijing) Company Limited.

• Moelis & Company Netherlands BV, a private limited company incorporated in Amsterdam, Netherlands. In addition to Amsterdam, Moelis Netherlands maintains operations in Paris, France through a wholly owned subsidiary, Moelis & Company Netherlands B.V. French Branch

• Moelis & Company India Private Limited, a private limited company incorporated in Mumbai, India.

• Moelis & Company Assessoria Financeira Ltda. (“Moelis Brazil”), a limited liability company incorporated in São Paulo, Brazil.

• An equity method investment in Moelis Australia Limited (“Moelis Australia”), a public company listed on the Australian Securities Exchange

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Summary of Significant Accounting Policies

3 Months Ended

Mar. 31, 2021

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Accounting —The Company prepared the accompanying condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). As permitted by the interim reporting rules and regulations set forth by the SEC, the condensed consolidated financial statements presented exclude certain financial information and footnote disclosures normally included in audited financial statements prepared in accordance with U.S. GAAP. In the opinion of the Company’s management, the accompanying unaudited condensed consolidated financial statements contain all adjustments, consisting of normal recurring adjustments, necessary to fairly present the accompanying unaudited condensed consolidated financial statements. These unaudited condensed

consolidated financial statements should be read in conjunction with the consolidated audited financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2020.

Consolidation —The Company’s policy is to consolidate (i) entities in which it has a controlling financial interest, (ii) variable interest entities where the Company has a variable interest and is deemed to be the primary beneficiary and (iii) limited partnerships where the Company has ownership of the majority of voting interests. When the Company does not have a controlling interest in an entity, but exerts significant influence over the entity’s operating and financial decisions, the Company applies the equity method of accounting in which it records in earnings its share of income or losses of the entity. All intercompany balances and transactions with the Company’s subsidiaries have been eliminated in consolidation.

Use of Estimates —The preparation of condensed consolidated financial statements and related disclosures in conformity with U.S. GAAP requires management to make estimates and assumptions 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. Actual results could differ from those estimates. Estimates and assumptions are reviewed periodically, and the effects of revisions are reflected in the period in which they are determined to be necessary.

In preparing the condensed consolidated financial statements, management makes estimates and assumptions regarding:

• the adequacy of the allowance for credit losses;

• the assessment of whether revenues from variable consideration should be constrained due to the probability of a significant revenue reversal;

• the assessment of probable lease terms and the measurement of the present value of such obligations;

• the measurement and realization of deferred taxes;

• the measurement of amount due pursuant to tax receivable agreement; and

• other matters that affect the reported amounts and disclosures of contingencies in the financial statements.

Cash, Cash Equivalents and Restricted Cash —Cash and cash equivalents include all short-term highly liquid investments that are readily convertible to known amounts of cash and have original maturities of three months or less from the date of purchase.

The Company’s cash is maintained in U.S. and non-U.S. bank accounts, of which most bank account balances had little or no insurance coverage (most balances are held in U.S. and U.K. accounts which exceeded the U.S. Federal Deposit Insurance Corporation and U.K. Financial Services Compensation Scheme coverage limits). The Company’s cash equivalents are invested primarily in U.S. Treasury instruments and money market securities.

The Company’s restricted cash is comprised of collateral deposits primarily held by certain non-U.S. subsidiaries. These deposits are required for certain direct debit accounts and are also used to satisfy future medical claims. A reconciliation of the Company’s cash, cash equivalents and restricted cash as of March 31, 2021 and 2020, is presented below.

	March 31,
	2021		2020
Cash	$	97,899	$	38,975
Cash equivalents		57,503		85,183
Restricted cash		1,081		597
Total cash, cash equivalents, and restricted cash shown in the statement of cash flows	$	156,483	$	124,755

Additionally, as of December 31, 2020, the Company held cash of $83,472 and cash equivalents of $119,005.

Receivables —The accompanying condensed consolidated statements of financial condition present accounts receivable balances net of allowance for credit losses based on the Company’s assessment of the collectability of customer accounts.

Included in the accounts receivable balances at March 31, 2021 and December 31, 2020 were $21,774 and $19,603 of long term receivables related to private funds advisory capital raising engagements, which are generally paid in installments over a period of three to four years. These long term receivables generated interest income of $204 and $188 for the three months ended March 31, 2021 and 2020, respectively.

The Company maintains an allowance for credit losses that, in management’s opinion, provides for an adequate reserve to cover losses that may be incurred. For purposes of determining appropriate allowances, the Company stratifies its population of accounts receivable into two categories, one for short-term receivables and a second for private funds advisory receivables. Each population is separately evaluated using an aging method that results in a percentage reserve based on the age of the receivable, in addition to considerations of historical charge-offs and current economic conditions.

After concluding that a reserved accounts receivable is no longer collectible, the Company will charge-off the receivable. This has the effect of reducing both the gross receivable and the allowance for credit losses. If a reserved accounts receivable is subsequently collected, such recoveries reduce the gross receivable and the allowance for credit losses and is a reduction of bad debt expense, which is recorded within other expenses on the condensed consolidated statement of operations. The combination of recoveries and the provision for credit losses of a reported period comprise the Company’s bad debt expense.

On January 1, 2020, the Company adopted Accounting Standards Update No. 2016-13— “Measurement of Credit Losses on Financial Instruments" ("ASU 2016-13") using the modified retrospective method. Upon adoption, a cumulative adjustment was recorded which decreased retained earnings by $459. The tax effect of this adjustment increased retained earnings by $95, resulting in a net decrease of $364 as of January 1, 2020. ASU 2016-13 replaces the incurred loss impairment methodology for financial instruments with the current expected credit loss (CECL) model which requires estimates of future credit losses based on reasonable supporting information. The Company will recognize its expected credit losses for each reporting period going forward.

The following tables summarize credit loss allowance activity for the three months ended March 31, 2021 and March 31, 2020:

	Three Months Ended March 31, 2021
	Accounts Receivable
		Short-term Receivables				Private Funds Advisory Receivables			Total
Allowance for Credit Losses, beginning balance	$		3,577		$		198	$		3,775
Charge-offs			(741	)			—			(741	)
Recoveries			(1,126	)			—			(1,126	)
Reduction to allowance			(1,867	)			—			(1,867	)
Provision for credit losses			4,253				22			4,275
Allowance for credit losses, ending balance	$		5,963		$		220	$		6,183

	Three Months Ended March 31, 2020
	Accounts Receivable
		Short-term Receivables				Private Funds Advisory Receivables				Total
Allowance for Credit Losses, beginning balance	$		4,088		$		—		$		4,088
Adjustment for adoption of ASU 2016-13			260				199				459
Allowance for Credit Losses, adjusted beginning balance			4,348				199				4,547
Charge-offs			(1,289	)			—				(1,289	)
Recoveries			(724	)			(26	)			(750	)
Reduction to allowance			(2,013	)			(26	)			(2,039	)
Provision for credit losses			1,216				52				1,268
Allowance for credit losses, ending balance	$		3,551		$		225		$		3,776

Deferred Compensation —Deferred compensation costs represent arrangements with certain employees whereby cash payments are subject to a required period of service subsequent to payment by the Company. These amounts are charged to expenses over the period that the employee is required to provide services in order to vest in the payment.

Financial Instruments at Fair Value —Fair value is generally based on quoted prices, however if quoted market prices are not available, fair value is determined based on other relevant factors, including dealer price quotations, price activity for equivalent instruments and valuation pricing models. The Company established a fair value hierarchy which prioritizes and ranks the level of market price observability used in measuring financial instruments at fair value. Market price observability is affected by a number of factors, including the type of instrument, the characteristics specific to the instrument and the state of the marketplace (including the existence and transparency of transactions between market participants). Financial instruments with readily-available actively quoted prices or for which fair value can be measured from actively-quoted prices in an orderly market will generally have a higher degree of market price observability and a lesser degree of judgment used in measuring fair value.

Financial instruments measured and reported at fair value are classified and disclosed in one of the following categories (from highest to lowest level of observability) based on inputs:

Level 1 —Quoted prices (unadjusted) are available in active markets for identical instruments that the Company has the ability to access as of the reporting date. The Company, to the extent that it holds such instruments, does not adjust the quoted price for these instruments, even in situations in which the Company holds a large position and a sale could reasonably affect the quoted price.

Level 2 —Pricing inputs are observable for the instruments, either directly or indirectly, as of the reporting date, but are not the same as those used in Level 1. Fair value is determined through the use of models or other valuation methodologies.

Level 3 —Pricing inputs are unobservable for the instruments and include situations where there is little, if any, market activity for the investments. The inputs into the determination of fair value require significant judgment or estimation by the Company’s management.

For level 3 investments in which pricing inputs are unobservable and limited market activity exists, management’s determination of fair value is based on the best information available, may incorporate management’s own assumptions and involves a significant degree of judgment. 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 investment is based on the lowest level of input that is significant to the fair value measurement. The Company’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 instrument.

Equity Method Investments —The Company accounts for its equity method investments under the equity method of accounting as the Company does not control these entities but has the ability to exercise significant influence. The amounts recorded in investments on the condensed consolidated statements of financial condition reflect the Company’s share of contributions made to, distributions received from, and the equity earnings and losses of, the investments. The Company reflects its share of gains and losses of the investment in other income and expenses in the condensed consolidated statements of operations using the most recently available earnings data at the end of the period.

Leases — The Company maintains operating leases for corporate offices and an aircraft. The Company determines if a contract contains a lease at inception. Operating leases are recorded as right-of-use (“ROU”) assets and lease liabilities on the condensed consolidated statements of financial condition. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease liabilities are recognized at the lease commencement date and are measured at the present value of anticipated lease payments over the lease term. The operating lease ROU assets are equal to the lease liabilities, adjusted for certain lease incentives, accrued rents, and prepaid rents. Typically, our borrowing rate is used to determine the present value of lease payments because the implicit rate is not readily determinable. Our lease terms may include options to extend or terminate the lease. These options are factored into our present value calculations when it is reasonably certain that such options will be exercised. Operating lease expense is recognized on a straight-line basis over the lease term.

Software— Costs related to implementation of cloud computing arrangements that qualify for capitalization are stated at cost less accumulated amortization within prepaid and other assets on the Company’s condensed consolidated statement of financial condition. Such capitalized costs are amortized using the straight-line method over the term of the cloud computing service contract or another rational basis, beginning when the cloud computing arrangement is substantially complete and ready for its intended use. All costs not directly related to the implementation of cloud computing arrangements, including overhead costs and costs of service agreements, will be expensed in the period they are incurred. The amortization expense of such capitalized costs will be presented under communication, technology and information services on the condensed consolidated statement of operations.

Effective January 1, 2020, the Company adopted ASU 2018-15, “Goodwill and Other —Internal Use Software” using a prospective approach (“ASU 2018-15”). ASU 2018-15 aligns the requirements for capitalizing implementation costs incurred in cloud computing arrangements with the requirements for capitalizing costs to develop or obtain internal-use software. See Note 4—Fixed and Intangible Assets below for further details on the Company’s capitalized cloud computing arrangements.

Equipment and Leasehold Improvements —Office equipment and furniture and fixtures are stated at cost less accumulated depreciation, which is determined using the straight-line method over the estimated useful lives of the assets, ranging from three to seven years, respectively. Leasehold improvements are stated at cost less accumulated amortization, which is determined using the straight-line method over the lesser of the term of the lease or the estimated useful life of the asset.

Major renewals and improvements are capitalized and minor replacements, maintenance and repairs are charged to expenses as incurred. Assets that are in development and have not yet been placed in service are generally classified as “Construction in Progress” and are reclassified to the appropriate category when the associated assets are placed in service. Upon retirement or disposal of assets, the cost and related accumulated depreciation or amortization are removed from the condensed consolidated statements of financial condition and any gain or loss is reflected in the condensed consolidated statements of operations.

Deferred Tax Asset and Amount Due Pursuant to Tax Receivable Agreement —In conjunction with the IPO, the Company was  treated for U.S. federal income tax purposes as having directly purchased Class A partnership units in Group LP from the existing unitholders. Additional Group LP Class A partnership units may be exchanged for shares of Class A common stock in the Company. The initial purchase and future exchanges are expected to result in an increase in the tax basis of Group LP’s assets attributable to the Company’s interest in Group LP. These increases in the tax basis of Group LP’s assets attributable to the Company’s interest in Group LP would not have been available but for the initial purchase and future exchanges. Such increases in tax basis are likely to increase (for tax purposes) depreciation and amortization deductions and therefore reduce the amount of income tax the Company would otherwise be required to pay in the future. As a result, the Company records a deferred tax asset for such increase in tax basis.

The Company has entered into a tax receivable agreement with its eligible Managing Directors that will provide for the payment by the Company to its eligible Managing Directors of 85% of the amount of cash savings, if any, in U.S. federal, state, and local income tax or franchise tax that the Company actually realizes as a result of (a) the increases in tax basis attributable to exchanges by its eligible Managing Directors and (b) tax benefits related to imputed interest deemed to be paid by the Company as a result of this tax receivable agreement. The Company expects to benefit from the remaining 15% of cash savings, if any, in income tax that it realizes and record any such estimated tax benefits as an increase to additional paid-in-capital. For purposes of the tax receivable agreement, cash savings in income tax will be computed by comparing the Company’s actual income tax liability to the amount of such taxes that it would have been required to pay had there been no increase to the tax basis of the tangible and intangible assets of Group LP as a result of the exchanges and had it not entered into the tax receivable agreement. The term of the tax receivable agreement commenced upon consummation of the IPO and will continue until all such tax benefits have been utilized or expired, unless the Company exercises its right to terminate the tax receivable agreement for an amount based on an agreed value of payments remaining to be made under the agreement. The Company has recorded the estimated tax benefits related to the increase in tax basis and imputed interest as a result of the initial purchase and subsequent exchanges described above as a deferred tax asset in the condensed consolidated statements of financial condition. The amount due to its eligible Managing Directors related to the tax receivable agreement as a result of the initial purchase and subsequent exchanges described above is recorded as amount due pursuant to tax receivable agreement in the condensed consolidated statements of financial condition. The amounts recorded for the deferred tax asset and the liability for our obligations under the tax receivable agreement are estimates. Any adjustments to our estimates subsequent to their initial establishment will be included in net income (loss). Future exchanges of Class A partnership units in Group LP for Class A common shares in the Company will be accounted for in a similar manner.

Revenue and Expense Recognition—We earn substantially all of our revenues from advisory engagements and, in many cases, we are not paid until the completion of an underlying transaction. The Company recognizes revenues from providing advisory services when or as our obligations are fulfilled and collection is reasonably assured. The vast majority of our advisory revenues, which include reimbursements for certain out-of-pocket expenses, are recognized over time; however, a small number of transactions may be recognized at a point in time. We provide our advisory service on an ongoing basis which, for example, may include evaluating and selecting one of multiple strategies. During such engagements, our clients are continuously benefitting from our counsel and the over time recognition matches the transfer of such benefits. However, the recognition of transaction fees is constrained until substantially all services have been provided, specified conditions have been met and it is probable that a significant reversal of revenue will not occur in a future period. Upfront fees and retainers specified in our engagement letters that meet the over time criteria will be recognized on a systematic basis over the estimated period where the related services are performed. Revenues may be recognized at a point in time if the engagement represents a singular objective that does not transfer any notable value until formally completed, such as when issuing a fairness opinion. In these instances, the point in time recognition appropriately matches the transfer and consumption of our services.

Incremental costs of obtaining a contract are expensed as incurred since such costs are generally not recoverable and the typical duration of our advisory contracts is less than one year. Costs to fulfill contracts consist of out-of-pocket expenses that are part of performing our advisory services and are typically expensed as incurred, except where the transfer and consumption of our services occurs at a point in time. For engagements recognized at a point in time, out-of-pocket expenses are capitalized and subsequently expensed in the condensed consolidated statement of operations upon completion of the engagement. The Company records deferred revenues when it receives fees from clients that have not yet been earned (e.g. an upfront fee) or when the Company has an unconditional right to consideration before all performance obligations are complete (e.g. upon satisfying conditions to earn an announcement fee, but before the transaction is consummated).

Complications that may terminate or delay a transaction include failure to agree upon final terms with the counterparty, failure to obtain required regulatory consents, failure to obtain board or stockholder approvals, failure to secure financing, adverse market conditions or unexpected operating or financial problems related to either party to the transaction. In these circumstances, we often do not receive advisory fees that would have been received if the transaction had been completed, despite the fact that we may have devoted considerable time and resources to the transaction. Barriers to the completion of a restructuring transaction may include a lack of anticipated bidders for the assets of our client, the inability of our client to restructure its operations, or indebtedness due to a failure to reach agreement with its creditors. In these circumstances, our fees are generally limited to monthly retainer fees and reimbursement of certain out-of-pocket expenses.

We do not allocate our revenue by the type of advice we provide because of the complexity of the transactions on which we may earn revenue and our holistic approach to client service. For example, a restructuring engagement may evolve to require a sale of all or a portion of the client, M&A assignments can develop from relationships established on prior restructuring engagements, and capital markets expertise can be instrumental on both M&A and restructuring assignments.

Equity-based Compensation — The Company recognizes the cost of services received in exchange for equity instrument awards. The cost is based on its grant-date fair value based on quoted market prices at the time of grant amortized over the service period required by the award’s vesting terms. The Company also recognizes the cost of services received from a nonemployee in exchange for an equity instrument based on the award’s grant-date fair value. The Company records as treasury stock shares repurchased from its employees for the purpose of settling tax liabilities incurred upon the vesting of restricted stock units (“RSUs”). The Company records dividends in kind, net of forfeitures, on outstanding RSUs as a reduction of retained earnings with a corresponding increase in additional paid-in capital, resulting in no net change to equity. Dividends in kind on RSUs are subject to the same vesting conditions as the underlying RSUs on which they were accrued. Dividends in kind will be forfeited if the underlying award does not vest.

The Company has a retirement plan whereby a retiring employee generally will not forfeit certain qualifying incentive RSUs granted during employment if at retirement the employee meets certain requirements. For qualifying awards, (i) the employee must be at least 56 years old, (ii) the employee must have provided at least 5 consecutive years of service to the Company and (iii) the total of (i) and (ii) must be equal to at least 65 years. Any such RSUs will continue to vest on their applicable vesting schedule, subject to noncompetition and other terms. Over time a greater number of employees may become retirement eligible and the related requisite service period over which we will expense these awards will be shorter than the stated vesting period. Any unvested RSUs are eligible to receive dividends in kind; however, the right to dividends in kind will be forfeited if the underlying award does not vest.

Income Taxes — The Company accounts for income taxes in accordance with ASC 740, “Accounting for Income Taxes” (“ASC 740”), which requires the recognition of tax benefits or expenses on temporary differences between the financial reporting and tax bases of its assets and liabilities by applying the enacted tax rates in effect for the year in which the differences are expected to reverse. Such net tax effects on temporary differences are reflected on the Company’s condensed consolidated statements of financial condition as deferred tax assets and liabilities. Deferred tax assets are reduced by a valuation allowance when the Company believes that it is more-likely-than-not that some portion or all of the deferred tax assets will not be realized.

ASC 740-10 prescribes a two-step approach for the recognition and measurement of tax benefits associated with the positions taken or expected to be taken in a tax return that affect amounts reported in the financial statements. The Company has reviewed and will continue to review the conclusions reached regarding uncertain tax positions, which may be subject to review and adjustment at a later date based on ongoing analyses of tax laws, regulations and interpretations thereof. For the three months ended March 31, 2021 and 2020, no unrecognized tax benefit was recorded. To the extent that the Company’s assessment of the conclusions reached regarding uncertain tax positions changes as a result of the evaluation of new information, such change in estimate will be recorded in the period in which such determination is made. The Company reports income tax-related interest and penalties relating to uncertain tax positions, if applicable, as a component of income tax expense. For the three months ended March 31, 2021 and 2020, no such amounts were recorded.

The Company recognizes excess tax benefits and deficiencies as income tax benefits or expenses in the condensed consolidated statement of operations. These are reflected in accounts payable, accrued expenses and other liabilities within the condensed consolidated statement of cash flows.

Effective January 1, 2021, the Company adopted Accounting Standards Update No. 2019-12, “Income Taxes” (“ASU 2019-12”). ASU 2019-12 removes certain rule exceptions to simplify accounting for income taxes. ASU 2019-12 has been incorporated into our provision for income taxes calculation and does not have a material impact to our overall income taxes.

Foreign Currency Translation — Assets and liabilities held in non-U.S. dollar denominated currencies are translated into U.S. dollars at exchange rates in effect at the end of the reporting period. Revenues and expenses are translated at average exchange rates during the reporting period. A charge or credit is recorded to other comprehensive income to reflect the translation of these amounts to the extent the non-U.S. currency is designated the functional currency of the subsidiary. Non-functional currency related transaction gains and losses are immediately recorded in the condensed consolidated statements of operations.

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Recent Accounting Pronouncements

3 Months Ended

Mar. 31, 2021

New Accounting Pronouncements And Changes In Accounting Principles [Abstract]

Recent Accounting Pronouncements

3. RECENT ACCOUNTING PRONOUNCEMENTS

In March 2020, the FASB issued Accounting Standards Update No. 2020-04, “Reference Rate Reform” (“ASU 2020-04”). ASU 2020-04 provides optional guidance for entities that are impacted by interest rate reform. Specifically, ASU 2020-04 allows for contracts under the scope of Topic 310—Receivables to be accounted for prospectively with the updated interest rate, among other specifications for debt, derivative instruments, and other contracts. ASU 2020-04 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2022. Early application is permitted. Upon initial evaluation, we do not anticipate any material changes to our condensed consolidated financial statements.

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Fixed and Intangible Assets

3 Months Ended

Mar. 31, 2021

Property Plant And Equipment [Abstract]

Fixed and Intangible Assets

4. FIXED AND INTANGIBLE ASSETS

Equipment and leasehold improvements, net consists of the following:

	March 31,			December 31,
	2021			2020
Office equipment	$	13,286		$	13,267
Furniture and fixtures		10,529			10,409
Leasehold improvements		36,548			36,286
Construction in progress		18,078			14,943
Total		78,441			74,905
Less accumulated depreciation and amortization		(26,374	)		(24,928	)
Equipment and leasehold improvements, net	$	52,067		$	49,977

Depreciation and amortization expenses for fixed assets totaled $1,449 and $1,199 for the three months ended March 31, 2021 and 2020, respectively.

As of March 31, 2021, there were $2,493 of costs capitalized within prepaid expenses and other assets on our condensed consolidated statement of financial position related to the implementation of cloud computing arrangements. The amortization expense of the capitalized costs was $122 and $0 for the three months ended March 31, 2021 and 2020, respectively, and was recorded within communication, technology and information services on the condensed consolidated statement of operations.

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Investments

3 Months Ended

Mar. 31, 2021

Investments All Other Investments [Abstract]

Investments

5. INVESTMENTS

Fair value investments are contained within the balance of investments on the Company’s condensed consolidated statements of financial condition. The Company established a fair value hierarchy which prioritizes and ranks the level of market price observability used in measuring investments at fair value. Financial instruments measured and reported at fair value are classified and disclosed in one of the following categories (from highest to lowest level of observability) based on inputs:

Level 1—Quoted prices (unadjusted) are available in active markets for identical instruments that the Company has the ability to access as of the reporting date. The Company, to the extent that it holds such instruments, does not adjust the quoted price for these instruments, even in situations in which the Company holds a large position and a sale could reasonably affect the quoted price.

Level 2—Pricing inputs are observable for the instruments, either directly or indirectly, as of the reporting date, but are not the same as those used in level 1. Fair value is determined through the use of models or other valuation methodologies.

Level 3—Pricing inputs are unobservable for the instruments and include situations in which there is little, if any, market activity for the investments. The inputs into the determination of fair value require significant judgment or estimation by the Company’s management.

The estimated fair values of money market securities and U.S. Treasury instruments are based on quoted prices for recent trading activity in identical or similar instruments. The Company generally invests in U.S. Treasury instruments with maturities of less than twelve months. The Company considers these securities to be risk free and does not reserve for expected credit losses on these treasury investments. See Note 2 for further information on the Company’s fair value hierarchy.

The Company’s methodology for reclassifications impacting the fair value hierarchy is that transfers in/out of the respective category are reported at fair value as of the beginning of the period in which the reclassification occurred.

The following table summarizes the levels of the fair value hierarchy into which the Company’s financial assets fall as of March 31, 2021:

	Total		Level 1			Level 2		Level 3
Financial assets:
Included in cash and cash equivalents
U.S. treasury instruments	$	17,000	$	—		$	17,000	$	—
Money market securities		40,503		—			40,503		—
Investments
U.S. treasury instruments		72,262			—		72,262		—
Total financial assets	$	129,765	$		—	$	129,765	$		—

The cost basis of the financial assets recorded at fair value included in investments on the condensed consolidated statement of financial condition was $72,258 as of March 31, 2021.

The Company holds investments in the sponsors (collectively referred to herein as “Atlas Crest Sponsors”) of Atlas Crest Investment Corp. (“Atlas Crest I”), Atlas Crest Investment Corp. II (“Atlas Crest II”), Atlas Crest Investment Corp. III (“Atlas Crest III”), Atlas Crest Investment Corp. IV (“Atlas Crest IV”) and Atlas Crest Investment Corp. V (“Atlas Crest V”), each a special purpose acquisition company (“SPAC”) (each an “Atlas Crest Entity” and collectively, the “Atlas Crest Entities”). The Company’s Chief Executive Officer, Kenneth Moelis, is a founding member and the managing member of the Atlas Crest Sponsors and serves as Non-Executive Chairman of the Atlas Crest Entities. During 2020, the Company invested $887 into the sponsor of Atlas Crest I. During 2021, the Company invested $660, $2,788, $1,960, and $1,132 in the sponsors of Atlas Crest II, Atlas Crest III, Atlas Crest IV, and Atlas Crest V, respectively. These investments in the Atlas Crest Sponsors are recorded at cost and included in investments on the consolidated statement of financial condition. As of March 31, 2021, and December 31, 2020, the aggregate investment balance of the Atlas Crest Sponsors was $7,427 and $887, respectively.

The following table summarizes the levels of the fair value hierarchy into which the Company’s financial assets fall as of December 31, 2020:

	Total		Level 1			Level 2		Level 3
Financial assets:
Included in cash and cash equivalents
U.S. treasury instruments	$	15,599	$		—	$	15,599	$	—
Money market securities		103,406		—			103,406		—
Investments
U.S. treasury instruments		172,671		—			172,671		—
Total financial assets	$	291,676	$		—	$	291,676	$		—

For the three months ended March 31, 2020, unrealized losses of $25 were recognized in other income and expenses on the condensed consolidated statement of operations related to common stock held at the reporting date. The cost basis of the financial assets recorded at fair value included in investments on the condensed consolidated statement of financial condition was $172,640 as of December 31, 2020.

Equity-method investments are contained within the balance of investments on the Company’s condensed consolidated statements of financial condition. On April 1, 2010, the Company entered into a 50-50 joint venture in Moelis Australia Holdings PTY Limited, investing a combination of cash and certain net assets in exchange for its interests. On April 10, 2017, Moelis Australia Holdings PTY Limited consummated their initial public offering and became listed on the Australian Securities Exchange as Moelis Australia Limited (ASX: MOE). As a result of the offering, the Company’s ownership interest in Moelis Australia was diluted and continues to be accounted for under the equity method of accounting.

On February 17, 2021 and February 19, 2020, Moelis Australia declared dividends, of which the Company received $2,279 and $1,942 on March 4, 2021 and March 4, 2020, respectively. The Company accounted for the dividends as a return on investment and reduced the carrying value of the investment in Moelis Australia by $2,279 and $1,942, respectively.

The balances of the Company’s equity method investment as of March 31, 2021 and December 31, 2020 were $38,754 and $38,143, respectively, and are included within investments on the condensed consolidated statements of financial condition. The Company’s share of earnings on this investment is recorded in other income and expenses on the condensed consolidated statements of operations.

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Net Income (Loss) Per Share Attributable to Class A Common Shareholders

3 Months Ended

Mar. 31, 2021

Earnings Per Share [Abstract]

Net Income (Loss) Per Share Attributable to Class A Common Shareholders

6. NET INCOME (LOSS) PER SHARE ATTRIBUTABLE TO CLASS A COMMON SHAREHOLDERS

The calculations of basic and diluted net income (loss) per share attributable to holders of shares of Class A common stock for the three months ended March 31, 2021 and 2020 are presented below.

	Three Months Ended March 31,
(dollars in thousands, except per share amounts)	2021			2020
Numerator:
Net income (loss) attributable to holders of shares of Class A common stock—basic	$	66,529		$	25,130
Add (deduct) dilutive effect of:
Noncontrolling interests related to Class A partnership units			(a)			(a)
Net income (loss) attributable to holders of shares of Class A common stock—diluted	$	66,529		$	25,130
Denominator:
Weighted average shares of Class A common stock outstanding—basic		60,932,966			52,666,457
Add (deduct) dilutive effect of:
Noncontrolling interests related to Class A partnership units			(a)			(a)
Weighted average number of incremental shares issuable from unvested RSUs and stock options, as calculated using the treasury stock method		5,427,251	(b)		4,426,525	(b)
Weighted average shares of Class A common stock outstanding—diluted		66,360,217			57,092,982
Net income (loss) per share attributable to holders of shares of Class A common stock
Basic	$	1.09		$	0.48
Diluted	$	1.00		$	0.44

We have not included the impact of Class B common stock because these shares are entitled to an insignificant amount of economic participation.

(a) Class A partnership units may be exchanged for Moelis & Company Class A common stock on a one-for-one basis, subject to applicable exchange restrictions. If all Class A partnership units were to be exchanged for Class A common stock, fully diluted Class A common stock outstanding would be 74,625,284 and 70,051,004 for the three months ended March 31, 2021 and 2020, respectively. In computing the dilutive effect, if any, that the aforementioned exchange would have on net income (loss) per share, net income (loss) available to holders of Class A common stock would be adjusted due to the elimination of the noncontrolling interests in consolidated entities associated with the Group LP Class A partnership units (including any tax impact). For the three months ended March 31, 2021 and 2020, such exchange is not reflected in diluted net income (loss) per share as the assumed exchange is not dilutive.

(b) Certain shares of Moelis & Company’s Class A common stock assumed to be issued pursuant to certain RSUs as calculated using the treasury stock method were antidilutive and therefore have been excluded from the calculation of diluted net income (loss) per share attributable to Moelis & Company for certain periods. The additional weighted average amount of RSUs that would have been included in the treasury stock method calculation if the effect were dilutive would have been 1,539 and 1,613,603 units for the three months ended March 31, 2021 and 2020, respectively.

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Equity-Based Compensation

3 Months Ended

Mar. 31, 2021

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Equity-Based Compensation

7. EQUITY-BASED COMPENSATION

Pre-IPO Partnership Units

Prior to the Company’s IPO, the business operated as a partnership and its ownership structure was comprised of common partners (principally outside investors) holding units and Managing Directors and employees holding units. In connection with the IPO, Group LP issued Class A partnership units to Moelis & Company and to certain existing unit holders. Following the reorganization, a Group LP Class A partnership unit (not held by Moelis & Company or its subsidiaries) is exchangeable into one share of Moelis & Company Class A common stock and represents the Company’s noncontrolling interests.

The Company recognized compensation expenses of $0 and $30 for the three months ended March 31, 2021 and 2020, respectively, in relation to these pre-IPO partnership units.

2014 Omnibus Incentive Plan

In connection with the IPO, the Company adopted the Moelis & Company 2014 Omnibus Incentive Plan (the “Plan”) to provide additional incentives to selected officers, employees, Managing Directors, non-employee directors, independent contractors, partners, senior

advisors and consultants. The Plan provides for the issuance of incentive stock options (“ISOs”), nonqualified stock options, stock appreciation rights (“SARs”), restricted stock, RSUs, stock bonuses, other stock-based awards (including partnership interests that are exchangeable into stock upon satisfaction of certain conditions) and cash awards.

Restricted Stock Units (RSUs) and Other Stock-based Awards

Pursuant to the Plan and in connection with the Company’s annual compensation process and ongoing hiring process, the Company issues RSUs and other stock-based awards which generally vest over a service life of four to five years. For the three months ended March 31, 2021 and 2020, the Company recognized expense of $50,963 and $38,225, respectively, in relation to these awards. 

The following table summarizes activity related to RSUs and other stock-based awards for the three months ended March 31, 2021 and 2020.

	RSUs and Other Stock-based Awards
	2021					2020
				Weighted					Weighted
				Average					Average
	Number of			Grant Date		Number of			Grant Date
	Shares			Fair Value		Shares			Fair Value
Unvested Balance at January 1,		8,742,695		$	41.45		8,414,130		$	42.19
Granted		3,100,355			54.74		3,585,725			37.93
Forfeited		(34,974	)		48.44		(48,512	)		37.00
Vested		(3,689,539	)		42.86		(2,894,992	)		38.67
Unvested Balance at March 31,		8,118,537		$	46.43		9,056,351		$	41.53

As of March 31, 2021, the total compensation expense related to unvested RSUs and other stock-based awards not yet recognized was $221,171. The weighted-average period over which this compensation expense is expected to be recognized at March 31, 2021 is 2.2 years.

Stock Options

Pursuant to the Plan, the Company issued 3,501,881 stock options in 2014 which vest over a five-year period. The Company estimated the fair value of stock option awards at grant using the Black-Scholes valuation model with the following assumptions:

	Assumptions
Expected life (in years)		6
Weighted-average risk free interest rate		1.91	%
Expected volatility		35	%
Dividend yield		2.72	%
Weighted-average fair value at grant date	$	6.70

During the six year life of the options, the Company paid special dividends of $9.05, in aggregate. As required under Section 5 of the Company’s 2014 Omnibus Incentive Plan, the Compensation Committee of the Company’s Board of Directors equitably reduced the exercise price of the Company’s outstanding options to purchase common stock by $9.05 from $25.00 per share to $15.95 per share.

The following table summarizes activity related to stock options for the three months ended March 31, 2020:

	Stock Options Outstanding
	2020
				Weighted
				Average
	Number			Exercise Price
	Outstanding			Per Share
Outstanding at January 1,		728,534		$	15.95
Exercises		(722,034	)		15.95
Forfeitures or expirations		—			—
Outstanding at March 31,		6,500		$	15.95

For the three months ended March 31, 2021 and 2020, the Company recognized no expenses in relation to these stock options. As of April 2020, no stock options remain outstanding.

Share Repurchase Plan

In February 2019, the Board of Directors authorized the repurchase of up to $100,000 of shares of Class A common stock and/or Class A partnership units of Group LP with no expiration date. Under this share repurchase program, shares may be repurchased from time to time in open market transactions, in privately negotiated transactions or otherwise. The timing and the actual number of shares repurchased will be opportunistic and measured in nature and will depend on a variety of factors, including price and market conditions. The remaining balance of shares authorized for repurchase under the program was $73,601 as of March 31, 2021.

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Stockholders Equity

3 Months Ended

Mar. 31, 2021

Stockholders Equity Note [Abstract]

Stockholders Equity

8. STOCKHOLDERS EQUITY

Class A Common Stock

In April 2014, the Company issued 15,263,653 shares of Class A common stock in connection with the IPO and reorganization. Since its IPO, the Company has conducted several offerings of Class A common stock in order to facilitate organized liquidity and increase the public float of its Class A common stock. The aggregate increase to Class A common stock as a result of such offerings was 24,923,349 shares. The Company did not retain any proceeds from the sale of its Class A common stock.

As of March 31, 2021, there were 66,648,561 shares of Class A common stock issued, 5,323,017 shares of treasury stock, and 61,325,544 shares outstanding, and as of December 31, 2020, there were 61,986,927 shares of Class A common stock issued, 3,959,083 shares of treasury stock, and 58,027,844 shares outstanding. The changes in Class A common stock are due primarily to the IPO, offering transactions described above, exchanges of Class A partnership units, the exercise of stock options and vesting of restricted stock units in connection with the Company’s annual compensation process and ongoing hiring process.

Class B Common Stock

In conjunction with Moelis & Company’s IPO of its Class A common stock, the Company issued 36,158,698 shares of Class B common stock. Moelis & Company Partner Holdings LP (“Partner Holdings”) holds all shares of Class B common stock, enabling it initially to exercise majority voting control over the Company. In connection with the Company’s offerings of Class A common stock described above, 24,919,744 shares of Class B common stock were purchased from Partner Holdings at a cost of $550. The economic rights of Class B common stock are based on the ratio of the Class B subscription price to the initial public offering price of shares of Class A common stock (.00055 to 1). Shares of Class B common stock are generally not transferrable and, if transferred other than in the limited circumstances set forth in Moelis & Company’s Amended and Restated Certificate of Incorporation, such shares shall automatically convert into a number of shares of Class A common stock, or dollar equivalent. Each share of Class B common stock may also be converted to a number of Class A shares at the option of the holder. Holders of shares of Class B common stock are entitled to receive dividends of the same type as any dividends payable on outstanding shares of Class A common stock at a ratio of .00055 to 1.

As of March 31, 2021, and December 31, 2020, 4,899,457 and 5,948,750 shares of Class B common stock were issued and outstanding, respectively, due primarily to the IPO, offering transactions, and Class B conversions described above.

Treasury Stock

During the three months ended March 31, 2021 and 2020, the Company repurchased 1,363,934 and 869,779 shares, respectively, pursuant to the Company’s share repurchase program and shares repurchased from its employees for the purpose of settling tax liabilities incurred upon the delivery of equity-based compensation awards. The result of the repurchases was an increase of $74,211 and $31,636, respectively, in the treasury stock balance on the Company’s condensed consolidated statements of changes in equity as of March 31, 2021 and 2020.

Noncontrolling Interests

A Group LP Class A partnership unit (not held by Moelis & Company or its subsidiaries) is exchangeable into one share of Moelis & Company Class A common stock and represents the Company’s noncontrolling interests (non-redeemable). As of March 31, 2021 and December 31, 2020, partners held 7,855,398 and 8,508,857 Group LP partnership units, respectively, representing an 11% and 13% noncontrolling interest in Moelis & Company, respectively.

Controlling Interests

Moelis & Company operates and controls all of the business and affairs of Group LP and its operating entity subsidiaries indirectly through its equity interest in Group GP, and thus the 61,325,544 shares of Class A common stock outstanding at March 31, 2021 (58,027,844 as of December 31, 2020), represents the controlling interest.

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Related-Party Transactions

3 Months Ended

Mar. 31, 2021

Related Party Transactions [Abstract]

Related-Party Transactions

9. RELATED-PARTY TRANSACTIONS

Aircraft Lease— On August 30, 2014, a related party, Moelis & Company Manager LLC ("Manager"), acquired an aircraft with funds received solely from its managing member (Mr. Moelis). The aircraft was used and operated by the Company pursuant to a dry lease with Manager. The terms of the dry lease were comparable to the market rates of leasing from an independent third party. Pursuant to this dry lease arrangement, the lessee is obligated to bear its share of the costs of operating the aircraft. In addition, Mr. Moelis was the other lessee of the aircraft and shared the operating and related costs of the plane in proportion to his respective use pursuant to a cost sharing and operating agreement. On July 12, 2019, the Company terminated its aircraft dry lease with Manager, the lessor, and Mr. Moelis, the other lessee (the “Old Lease”) and the related cost sharing agreement with Mr. Moelis, which were set to expire by their terms on December 31, 2019, and entered into a new dry lease with Manager, the lessor, and Mr. Moelis, the other lessee (the “New Lease”) and cost sharing agreement with Mr. Moelis, which terminate on December 31, 2022. The terms of the New Lease and new cost sharing agreement are substantially similar to the Old Lease and related cost sharing agreement.

For the three months ended March 31, 2021 and 2020, the Company incurred $324 and $324 in aircraft lease costs to be paid to Manager, respectively.

Promissory Notes —As of March 31, 2021, there were $319 of unsecured promissory notes from employees held by the Company (December 31, 2020: $389). Any outstanding balances are reflected in accrued and other receivables on the condensed consolidated statements of financial condition. The notes bear fixed interest rates ranging from 3.00% to 4.00%. During the three months ended March 31, 2021 and 2020, the Company received $70 and $0 of principal repayments and recognized interest income of $5 and $2, on such notes, respectively, which is included in other income and expenses on the condensed consolidated statements of operations.

Services Agreement —In connection with the Company’s IPO, the Company entered into a services agreement with a related party, Moelis Asset Management LP, whereby the Company provides certain administrative services to Moelis Asset Management LP for a fee. This fee totaled $57 and $110 for the three months ended March 31, 2021 and 2020, respectively. The amount of the fee is based upon the estimated usage and related expense of all shared services between the Company and Moelis Asset Management LP during the relevant period, and will be assessed periodically by management as per the terms of the agreement. As of March 31, 2021 and December 31, 2020, the Company had no balances due from Moelis Asset Management LP.

Affiliated SPACs—During 2020, the Company began providing office space, secretarial, administrative and other corporate services for a fee of $10 a month to Atlas Crest I. In February 2021, the Company began providing these services to Atlas Crest II and is expected to begin providing these services to the other Atlas Crest Entities upon consummation of their initial public offerings, in each case for a fee of $10 per month. For the three months ended March 31, 2021, these fees totaled $50. This arrangement shall continue with each Atlas Crest Entity until such Atlas Crest Entity consummates a business combination or is liquidated. As of March 31, 2021 and December 31, 2020, the Company had no balance due from the Atlas Crest Entities or their sponsors.

In addition to the Company’s investments in the Atlas Crest Sponsors (described further in Note 5), the Company’s Executive Officers have a material, non-majority investment in the Atlas Crest Sponsors.

Moelis Australia —As of March 31, 2021 and December 31, 2020, the Company had a balance of $5 due to Moelis Australia which is reflected in accrued and other receivables on the condensed consolidated statements of financial condition. These balances consist of amounts due to or from Moelis Australia for advisory services performed as well as billable expenses incurred by the Company on behalf of Moelis Australia during the period. The relationship between the Company and Moelis Australia is governed by a services agreement.

Revenues —From time to time, the Company enters into advisory transactions with Moelis Asset Management LP and its affiliates. The Company earned revenues associated with such transactions of $0 for each of the three months ended March 31, 2021 and 2020, respectively.  

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Regulatory Requirements

3 Months Ended

Mar. 31, 2021

Regulatory Capital Requirements [Abstract]

Regulatory Requirements

10. REGULATORY REQUIREMENTS

Under the SEC Uniform Net Capital Rule (SEC Rule 15c3-1) Alternative Standard under Section (a)(1)(ii), the minimum net capital requirement is $250. At March 31, 2021, Moelis U.S. had net capital of $101,232, which was $100,982 in excess of its required net capital. At December 31, 2020, Moelis U.S. had net capital of $96,800 which was $96,550 in excess of its required net capital.

Certain other non-U.S. subsidiaries are subject to various securities and banking regulations and capital adequacy requirements promulgated by the regulatory and exchange authorities of the countries in which they operate. These subsidiaries have exceeded their local capital adequacy requirements at March 31, 2021.

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Commitments and Contingencies

3 Months Ended

Mar. 31, 2021

Commitments And Contingencies Disclosure [Abstract]

Commitments and Contingencies

11. COMMITMENTS AND CONTINGENCIES

Bank Line of Credit — In April 2020, the Company renewed its $65,000 revolving credit facility which extended the maturity date to June 30, 2021. Unless the lender issues a notice of termination at least 60 days prior to such maturity date, this facility will automatically extend to June 30, 2022.

Borrowings on the facility bear interest at the greater of a fixed rate of 3.50% per annum or at the borrower’s option of (i) LIBOR plus 1% or (ii) Prime minus 1.50%. As of March 31, 2021 and December 31, 2020, the Company had no borrowings under the credit facility.

As of March 31, 2021, the Company’s available credit under this facility was $60,507 as a result of the issuance of an aggregate amount of $4,493 of various standby letters of credit, which were required in connection with certain office lease and other agreements. The Company incurs a 1% per annum fee on the outstanding balance of issued letters of credit.

Leases —The Company maintains operating leases for corporate offices and an aircraft with various expiration dates, some of which extend through 2036. Some leases include options to terminate or to extend the lease terms. The Company records lease liabilities measured at the present value of anticipated lease payments over the lease term, including options to extend or terminate the lease when it is reasonably certain such options will be exercised. The implicit discount rates used to determine the present value of the Company’s leases are not readily determinable, thus the Company uses its secured borrowing rate, which was determined with reference to our available credit line. See below for additional information about the Company’s leases.

	Three Months Ended
	March 31,
($ in thousands)	2021			2020
Supplemental Income Statement Information:
Operating lease cost	$	7,154		$	6,365
Supplemental Cash Flow Information:
Cash paid for amounts included in the measurement of lease liabilities:
Net operating cash outflows for operating leases	$	5,980		$	5,299
Right-of-use assets obtained in exchange for lease obligations (e.g. new leases and amendments commenced during the period):	$	321		$	2,414
Other Information
Weighted-average remaining lease term - operating leases		13.69	years		13.82	years
Weighted-average discount rate - operating leases		3.52	%		3.53	%

The future sublease income and maturities of our operating lease liabilities as of March 31, 2021, are as follows:

Fiscal year ended	Sublease Income			Operating Leases
Remainder of 2021	$	(689	)	$	14,323
2022		(919	)		24,214
2023		(919	)		20,971
2024		(919	)		19,085
2025		(459	)		16,326
Thereafter		-			177,587
Total Payments	$	(3,905	)	$	272,506
Less: Tenant improvement allowances					(18,440	)
Less: Present value adjustment					(60,190	)
Total				$	193,876

Contractual Arrangements —In the normal course of business, the Company enters into contracts that contain a variety of representations and warranties and which provide indemnification for specified losses, including certain indemnification of certain officers, directors and employees.

Legal —In the ordinary course of business, from time to time the Company and its affiliates are involved in judicial or regulatory proceedings, arbitration or mediation concerning matters arising in connection with the conduct of its businesses, including contractual and employment matters. In addition, government agencies and self-regulatory organizations conduct periodic examinations and initiate administrative proceedings regarding the Company’s business, including, among other matters, compliance, accounting and operational matters, that can result in censure, fine, the issuance of cease-and-desist orders or the suspension or expulsion of a broker-dealer, investment advisor, or its directors, officers or employees. In view of the inherent difficulty of determining whether any loss in connection with such matters is probable and whether the amount of such loss can be reasonably estimated, particularly in cases where claimants seek substantial or indeterminate damages or where investigations and proceedings are in the early stages, the Company cannot estimate the amount of such loss or range of loss, if any, related to such matters, how or if such matters will be resolved, when they will ultimately be resolved, or what the eventual settlement, fine, penalty or other relief, if any, might be. Subject to the foregoing, the Company believes, based on current knowledge and after consultation with counsel, that it is not currently party to any material pending proceedings, individually or in the aggregate, the resolution of which would have a material effect on the Company.

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Employee Benefit Plans

3 Months Ended

Mar. 31, 2021

Compensation And Retirement Disclosure [Abstract]

Employee Benefit Plans

12. EMPLOYEE BENEFIT PLANS

The Company covers substantially all U.S. salaried employees with a defined contribution 401(k) plan. Each salaried employee of the Company who has attained the age of 21 is eligible to participate in the 401(k) plan on their first day of employment. Any employer contributions to the 401(k) plan are entirely at the discretion of the Company. The Company accrued expenses relating to employer matching contributions to the 401(k) plan for the three months ended March 31, 2021 and 2020, in the amounts of $715 and $696, respectively.

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Income Taxes

3 Months Ended

Mar. 31, 2021

Income Tax Disclosure [Abstract]

Income Taxes

13. INCOME TAXES

The Company’s operations are comprised of entities that are organized as limited liability companies and limited partnerships. For U.S. federal income tax purposes, taxes related to income earned by these entities represent obligations of their interest holders, except for certain other foreign, state, and local taxes (for example, the New York City unincorporated business tax (“UBT”)). In addition, the Company is subject to U.S. corporate federal, state, and local income tax on its allocable share of results of operations from Group LP.

The Company’s provisions for income taxes and effective tax rates were a benefit of $176 and (0.2%) and a benefit of $7,344 and (32.2%), for the three months ended March 31, 2021 and 2020, respectively. The income tax provision for the aforementioned periods primarily reflects the Company’s allocable share of earnings from Group LP at the prevailing U.S. federal, state, and local corporate income tax rates offset by the effect of the excess tax benefit recognized in connection with the delivery of equity-based compensation at an appreciated price above the grant date price for such equity. The excess tax benefits for the three months ended March 31, 2021 and 2020 were $17,542 and $7,337, respectively.

There was an exchange of Class A partnership units for Class A common stock in February 2021 that resulted in an increase to our deferred tax asset related to a step-up in the tax basis in Group LP assets. Approximately $19,392 of the increase to this deferred tax asset is attributable to exchanges by certain partners of Group LP who are party to the tax receivable agreement. Pursuant to this agreement, 85% (or $16,483) of the tax benefits associated with this portion of the deferred tax asset are payable to such exchanging partners over the next 15 years and recorded as amount due pursuant to tax receivable agreement in the condensed consolidated statements of financial condition. The remaining tax benefit is allocable to the Company and is recorded in additional paid-in-capital.

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Revenues and Business Information

3 Months Ended

Mar. 31, 2021

Segment Reporting [Abstract]

Revenues and Business Information

14. REVENUES AND BUSINESS INFORMATION

The Company’s activities as an investment banking advisory firm constitute a single business segment offering clients, including corporations, governments, sovereign wealth funds, and financial sponsors, a range of advisory services with expertise across all major industries in mergers and acquisitions, recapitalizations and restructurings, capital markets and other corporate finance matters.

Since the financial markets are global in nature, the Company generally manages its business based on the operating results of the enterprise taken as whole, not by geographic region. The following table disaggregates the revenues and assets based on the location of the office that generates the revenues or holds the assets, and therefore may not be reflective of the geography in which our clients are located.

	Three Months Ended March 31,
	2021		2020
Revenues:
United States	$	206,252	$	129,185
Europe		43,716		16,256
Rest of World		13,898		8,265
Total	$	263,866	$	153,706

	March 31,		December 31,
	2021		2020
Assets:
United States	$	899,075	$	1,012,831
Europe		87,404		78,470
Rest of World		84,618		105,143
Total	$	1,071,097	$	1,196,444

As of March 31, 2021, and December 31, 2020, the Company had deferred revenues of $8,105 and $2,692, respectively. These amounts primarily consist of upfront fees and retainers for our services. During the three months ended March 31, 2021, $1,682 of revenues were recognized from the opening balance of deferred revenues.

Due to the factors that may delay or terminate a transaction (see Note 2), the Company does not estimate constrained transaction fees for revenue recognition. Quantitative disclosures of constrained variable consideration are not provided for remaining, wholly unsatisfied, performance obligations. The remaining performance obligations related to retainers, upfront fees and announcement fees are typically associated with contracts that have durations of one year or less.

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Subsequent Events

3 Months Ended

Mar. 31, 2021

Subsequent Events [Abstract]

Subsequent Events

15. SUBSEQUENT EVENTS

The Board of Directors of Moelis & Company declared a special dividend of $2.00 per share in addition to a regular quarterly dividend of $0.55 per share. The $2.55 per share will be paid on June 18, 2021 to shareholders of record as of May 10, 2021.

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Summary of Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2021

Accounting Policies [Abstract]

Basis of Accounting

Basis of Accounting —The Company prepared the accompanying condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). As permitted by the interim reporting rules and regulations set forth by the SEC, the condensed consolidated financial statements presented exclude certain financial information and footnote disclosures normally included in audited financial statements prepared in accordance with U.S. GAAP. In the opinion of the Company’s management, the accompanying unaudited condensed consolidated financial statements contain all adjustments, consisting of normal recurring adjustments, necessary to fairly present the accompanying unaudited condensed consolidated financial statements. These unaudited condensed

consolidated financial statements should be read in conjunction with the consolidated audited financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2020.

Consolidation

Consolidation —The Company’s policy is to consolidate (i) entities in which it has a controlling financial interest, (ii) variable interest entities where the Company has a variable interest and is deemed to be the primary beneficiary and (iii) limited partnerships where the Company has ownership of the majority of voting interests. When the Company does not have a controlling interest in an entity, but exerts significant influence over the entity’s operating and financial decisions, the Company applies the equity method of accounting in which it records in earnings its share of income or losses of the entity. All intercompany balances and transactions with the Company’s subsidiaries have been eliminated in consolidation.

Use of Estimates

Use of Estimates —The preparation of condensed consolidated financial statements and related disclosures in conformity with U.S. GAAP requires management to make estimates and assumptions 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. Actual results could differ from those estimates. Estimates and assumptions are reviewed periodically, and the effects of revisions are reflected in the period in which they are determined to be necessary.

In preparing the condensed consolidated financial statements, management makes estimates and assumptions regarding:

• the adequacy of the allowance for credit losses;

• the assessment of whether revenues from variable consideration should be constrained due to the probability of a significant revenue reversal;

• the assessment of probable lease terms and the measurement of the present value of such obligations;

• the measurement and realization of deferred taxes;

• the measurement of amount due pursuant to tax receivable agreement; and

• other matters that affect the reported amounts and disclosures of contingencies in the financial statements.

Cash, Cash Equivalents and Restricted Cash

Cash, Cash Equivalents and Restricted Cash —Cash and cash equivalents include all short-term highly liquid investments that are readily convertible to known amounts of cash and have original maturities of three months or less from the date of purchase.

The Company’s cash is maintained in U.S. and non-U.S. bank accounts, of which most bank account balances had little or no insurance coverage (most balances are held in U.S. and U.K. accounts which exceeded the U.S. Federal Deposit Insurance Corporation and U.K. Financial Services Compensation Scheme coverage limits). The Company’s cash equivalents are invested primarily in U.S. Treasury instruments and money market securities.

The Company’s restricted cash is comprised of collateral deposits primarily held by certain non-U.S. subsidiaries. These deposits are required for certain direct debit accounts and are also used to satisfy future medical claims. A reconciliation of the Company’s cash, cash equivalents and restricted cash as of March 31, 2021 and 2020, is presented below.

	March 31,
	2021		2020
Cash	$	97,899	$	38,975
Cash equivalents		57,503		85,183
Restricted cash		1,081		597
Total cash, cash equivalents, and restricted cash shown in the statement of cash flows	$	156,483	$	124,755

Additionally, as of December 31, 2020, the Company held cash of $83,472 and cash equivalents of $119,005.

Receivables

Receivables —The accompanying condensed consolidated statements of financial condition present accounts receivable balances net of allowance for credit losses based on the Company’s assessment of the collectability of customer accounts.

Included in the accounts receivable balances at March 31, 2021 and December 31, 2020 were $21,774 and $19,603 of long term receivables related to private funds advisory capital raising engagements, which are generally paid in installments over a period of three to four years. These long term receivables generated interest income of $204 and $188 for the three months ended March 31, 2021 and 2020, respectively.

The Company maintains an allowance for credit losses that, in management’s opinion, provides for an adequate reserve to cover losses that may be incurred. For purposes of determining appropriate allowances, the Company stratifies its population of accounts receivable into two categories, one for short-term receivables and a second for private funds advisory receivables. Each population is separately evaluated using an aging method that results in a percentage reserve based on the age of the receivable, in addition to considerations of historical charge-offs and current economic conditions.

After concluding that a reserved accounts receivable is no longer collectible, the Company will charge-off the receivable. This has the effect of reducing both the gross receivable and the allowance for credit losses. If a reserved accounts receivable is subsequently collected, such recoveries reduce the gross receivable and the allowance for credit losses and is a reduction of bad debt expense, which is recorded within other expenses on the condensed consolidated statement of operations. The combination of recoveries and the provision for credit losses of a reported period comprise the Company’s bad debt expense.

On January 1, 2020, the Company adopted Accounting Standards Update No. 2016-13— “Measurement of Credit Losses on Financial Instruments" ("ASU 2016-13") using the modified retrospective method. Upon adoption, a cumulative adjustment was recorded which decreased retained earnings by $459. The tax effect of this adjustment increased retained earnings by $95, resulting in a net decrease of $364 as of January 1, 2020. ASU 2016-13 replaces the incurred loss impairment methodology for financial instruments with the current expected credit loss (CECL) model which requires estimates of future credit losses based on reasonable supporting information. The Company will recognize its expected credit losses for each reporting period going forward.

The following tables summarize credit loss allowance activity for the three months ended March 31, 2021 and March 31, 2020:

	Three Months Ended March 31, 2021
	Accounts Receivable
		Short-term Receivables				Private Funds Advisory Receivables			Total
Allowance for Credit Losses, beginning balance	$		3,577		$		198	$		3,775
Charge-offs			(741	)			—			(741	)
Recoveries			(1,126	)			—			(1,126	)
Reduction to allowance			(1,867	)			—			(1,867	)
Provision for credit losses			4,253				22			4,275
Allowance for credit losses, ending balance	$		5,963		$		220	$		6,183

	Three Months Ended March 31, 2020
	Accounts Receivable
		Short-term Receivables				Private Funds Advisory Receivables				Total
Allowance for Credit Losses, beginning balance	$		4,088		$		—		$		4,088
Adjustment for adoption of ASU 2016-13			260				199				459
Allowance for Credit Losses, adjusted beginning balance			4,348				199				4,547
Charge-offs			(1,289	)			—				(1,289	)
Recoveries			(724	)			(26	)			(750	)
Reduction to allowance			(2,013	)			(26	)			(2,039	)
Provision for credit losses			1,216				52				1,268
Allowance for credit losses, ending balance	$		3,551		$		225		$		3,776

Deferred Compensation

Deferred Compensation —Deferred compensation costs represent arrangements with certain employees whereby cash payments are subject to a required period of service subsequent to payment by the Company. These amounts are charged to expenses over the period that the employee is required to provide services in order to vest in the payment.

Financial Instruments at Fair Value

Financial Instruments at Fair Value —Fair value is generally based on quoted prices, however if quoted market prices are not available, fair value is determined based on other relevant factors, including dealer price quotations, price activity for equivalent instruments and valuation pricing models. The Company established a fair value hierarchy which prioritizes and ranks the level of market price observability used in measuring financial instruments at fair value. Market price observability is affected by a number of factors, including the type of instrument, the characteristics specific to the instrument and the state of the marketplace (including the existence and transparency of transactions between market participants). Financial instruments with readily-available actively quoted prices or for which fair value can be measured from actively-quoted prices in an orderly market will generally have a higher degree of market price observability and a lesser degree of judgment used in measuring fair value.

Financial instruments measured and reported at fair value are classified and disclosed in one of the following categories (from highest to lowest level of observability) based on inputs:

Level 1 —Quoted prices (unadjusted) are available in active markets for identical instruments that the Company has the ability to access as of the reporting date. The Company, to the extent that it holds such instruments, does not adjust the quoted price for these instruments, even in situations in which the Company holds a large position and a sale could reasonably affect the quoted price.

Level 2 —Pricing inputs are observable for the instruments, either directly or indirectly, as of the reporting date, but are not the same as those used in Level 1. Fair value is determined through the use of models or other valuation methodologies.

Level 3 —Pricing inputs are unobservable for the instruments and include situations where there is little, if any, market activity for the investments. The inputs into the determination of fair value require significant judgment or estimation by the Company’s management.

For level 3 investments in which pricing inputs are unobservable and limited market activity exists, management’s determination of fair value is based on the best information available, may incorporate management’s own assumptions and involves a significant degree of judgment. 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 investment is based on the lowest level of input that is significant to the fair value measurement. The Company’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 instrument.

Equity Method Investments

Equity Method Investments —The Company accounts for its equity method investments under the equity method of accounting as the Company does not control these entities but has the ability to exercise significant influence. The amounts recorded in investments on the condensed consolidated statements of financial condition reflect the Company’s share of contributions made to, distributions received from, and the equity earnings and losses of, the investments. The Company reflects its share of gains and losses of the investment in other income and expenses in the condensed consolidated statements of operations using the most recently available earnings data at the end of the period.

Leases

Leases — The Company maintains operating leases for corporate offices and an aircraft. The Company determines if a contract contains a lease at inception. Operating leases are recorded as right-of-use (“ROU”) assets and lease liabilities on the condensed consolidated statements of financial condition. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease liabilities are recognized at the lease commencement date and are measured at the present value of anticipated lease payments over the lease term. The operating lease ROU assets are equal to the lease liabilities, adjusted for certain lease incentives, accrued rents, and prepaid rents. Typically, our borrowing rate is used to determine the present value of lease payments because the implicit rate is not readily determinable. Our lease terms may include options to extend or terminate the lease. These options are factored into our present value calculations when it is reasonably certain that such options will be exercised. Operating lease expense is recognized on a straight-line basis over the lease term.

Software

Software— Costs related to implementation of cloud computing arrangements that qualify for capitalization are stated at cost less accumulated amortization within prepaid and other assets on the Company’s condensed consolidated statement of financial condition. Such capitalized costs are amortized using the straight-line method over the term of the cloud computing service contract or another rational basis, beginning when the cloud computing arrangement is substantially complete and ready for its intended use. All costs not directly related to the implementation of cloud computing arrangements, including overhead costs and costs of service agreements, will be expensed in the period they are incurred. The amortization expense of such capitalized costs will be presented under communication, technology and information services on the condensed consolidated statement of operations.

Effective January 1, 2020, the Company adopted ASU 2018-15, “Goodwill and Other —Internal Use Software” using a prospective approach (“ASU 2018-15”). ASU 2018-15 aligns the requirements for capitalizing implementation costs incurred in cloud computing arrangements with the requirements for capitalizing costs to develop or obtain internal-use software. See Note 4—Fixed and Intangible Assets below for further details on the Company’s capitalized cloud computing arrangements.

Equipment and Leasehold Improvements

Equipment and Leasehold Improvements —Office equipment and furniture and fixtures are stated at cost less accumulated depreciation, which is determined using the straight-line method over the estimated useful lives of the assets, ranging from three to seven years, respectively. Leasehold improvements are stated at cost less accumulated amortization, which is determined using the straight-line method over the lesser of the term of the lease or the estimated useful life of the asset.

Major renewals and improvements are capitalized and minor replacements, maintenance and repairs are charged to expenses as incurred. Assets that are in development and have not yet been placed in service are generally classified as “Construction in Progress” and are reclassified to the appropriate category when the associated assets are placed in service. Upon retirement or disposal of assets, the cost and related accumulated depreciation or amortization are removed from the condensed consolidated statements of financial condition and any gain or loss is reflected in the condensed consolidated statements of operations.

Deferred Tax Asset and Amount Due Pursuant to Tax Receivable Agreement

Deferred Tax Asset and Amount Due Pursuant to Tax Receivable Agreement —In conjunction with the IPO, the Company was  treated for U.S. federal income tax purposes as having directly purchased Class A partnership units in Group LP from the existing unitholders. Additional Group LP Class A partnership units may be exchanged for shares of Class A common stock in the Company. The initial purchase and future exchanges are expected to result in an increase in the tax basis of Group LP’s assets attributable to the Company’s interest in Group LP. These increases in the tax basis of Group LP’s assets attributable to the Company’s interest in Group LP would not have been available but for the initial purchase and future exchanges. Such increases in tax basis are likely to increase (for tax purposes) depreciation and amortization deductions and therefore reduce the amount of income tax the Company would otherwise be required to pay in the future. As a result, the Company records a deferred tax asset for such increase in tax basis.

The Company has entered into a tax receivable agreement with its eligible Managing Directors that will provide for the payment by the Company to its eligible Managing Directors of 85% of the amount of cash savings, if any, in U.S. federal, state, and local income tax or franchise tax that the Company actually realizes as a result of (a) the increases in tax basis attributable to exchanges by its eligible Managing Directors and (b) tax benefits related to imputed interest deemed to be paid by the Company as a result of this tax receivable agreement. The Company expects to benefit from the remaining 15% of cash savings, if any, in income tax that it realizes and record any such estimated tax benefits as an increase to additional paid-in-capital. For purposes of the tax receivable agreement, cash savings in income tax will be computed by comparing the Company’s actual income tax liability to the amount of such taxes that it would have been required to pay had there been no increase to the tax basis of the tangible and intangible assets of Group LP as a result of the exchanges and had it not entered into the tax receivable agreement. The term of the tax receivable agreement commenced upon consummation of the IPO and will continue until all such tax benefits have been utilized or expired, unless the Company exercises its right to terminate the tax receivable agreement for an amount based on an agreed value of payments remaining to be made under the agreement. The Company has recorded the estimated tax benefits related to the increase in tax basis and imputed interest as a result of the initial purchase and subsequent exchanges described above as a deferred tax asset in the condensed consolidated statements of financial condition. The amount due to its eligible Managing Directors related to the tax receivable agreement as a result of the initial purchase and subsequent exchanges described above is recorded as amount due pursuant to tax receivable agreement in the condensed consolidated statements of financial condition. The amounts recorded for the deferred tax asset and the liability for our obligations under the tax receivable agreement are estimates. Any adjustments to our estimates subsequent to their initial establishment will be included in net income (loss). Future exchanges of Class A partnership units in Group LP for Class A common shares in the Company will be accounted for in a similar manner.

Revenue and Expense Recognition

Revenue and Expense Recognition—We earn substantially all of our revenues from advisory engagements and, in many cases, we are not paid until the completion of an underlying transaction. The Company recognizes revenues from providing advisory services when or as our obligations are fulfilled and collection is reasonably assured. The vast majority of our advisory revenues, which include reimbursements for certain out-of-pocket expenses, are recognized over time; however, a small number of transactions may be recognized at a point in time. We provide our advisory service on an ongoing basis which, for example, may include evaluating and selecting one of multiple strategies. During such engagements, our clients are continuously benefitting from our counsel and the over time recognition matches the transfer of such benefits. However, the recognition of transaction fees is constrained until substantially all services have been provided, specified conditions have been met and it is probable that a significant reversal of revenue will not occur in a future period. Upfront fees and retainers specified in our engagement letters that meet the over time criteria will be recognized on a systematic basis over the estimated period where the related services are performed. Revenues may be recognized at a point in time if the engagement represents a singular objective that does not transfer any notable value until formally completed, such as when issuing a fairness opinion. In these instances, the point in time recognition appropriately matches the transfer and consumption of our services.

Incremental costs of obtaining a contract are expensed as incurred since such costs are generally not recoverable and the typical duration of our advisory contracts is less than one year. Costs to fulfill contracts consist of out-of-pocket expenses that are part of performing our advisory services and are typically expensed as incurred, except where the transfer and consumption of our services occurs at a point in time. For engagements recognized at a point in time, out-of-pocket expenses are capitalized and subsequently expensed in the condensed consolidated statement of operations upon completion of the engagement. The Company records deferred revenues when it receives fees from clients that have not yet been earned (e.g. an upfront fee) or when the Company has an unconditional right to consideration before all performance obligations are complete (e.g. upon satisfying conditions to earn an announcement fee, but before the transaction is consummated).

Complications that may terminate or delay a transaction include failure to agree upon final terms with the counterparty, failure to obtain required regulatory consents, failure to obtain board or stockholder approvals, failure to secure financing, adverse market conditions or unexpected operating or financial problems related to either party to the transaction. In these circumstances, we often do not receive advisory fees that would have been received if the transaction had been completed, despite the fact that we may have devoted considerable time and resources to the transaction. Barriers to the completion of a restructuring transaction may include a lack of anticipated bidders for the assets of our client, the inability of our client to restructure its operations, or indebtedness due to a failure to reach agreement with its creditors. In these circumstances, our fees are generally limited to monthly retainer fees and reimbursement of certain out-of-pocket expenses.

We do not allocate our revenue by the type of advice we provide because of the complexity of the transactions on which we may earn revenue and our holistic approach to client service. For example, a restructuring engagement may evolve to require a sale of all or a portion of the client, M&A assignments can develop from relationships established on prior restructuring engagements, and capital markets expertise can be instrumental on both M&A and restructuring assignments.

Equity-based Compensation

Equity-based Compensation — The Company recognizes the cost of services received in exchange for equity instrument awards. The cost is based on its grant-date fair value based on quoted market prices at the time of grant amortized over the service period required by the award’s vesting terms. The Company also recognizes the cost of services received from a nonemployee in exchange for an equity instrument based on the award’s grant-date fair value. The Company records as treasury stock shares repurchased from its employees for the purpose of settling tax liabilities incurred upon the vesting of restricted stock units (“RSUs”). The Company records dividends in kind, net of forfeitures, on outstanding RSUs as a reduction of retained earnings with a corresponding increase in additional paid-in capital, resulting in no net change to equity. Dividends in kind on RSUs are subject to the same vesting conditions as the underlying RSUs on which they were accrued. Dividends in kind will be forfeited if the underlying award does not vest.

The Company has a retirement plan whereby a retiring employee generally will not forfeit certain qualifying incentive RSUs granted during employment if at retirement the employee meets certain requirements. For qualifying awards, (i) the employee must be at least 56 years old, (ii) the employee must have provided at least 5 consecutive years of service to the Company and (iii) the total of (i) and (ii) must be equal to at least 65 years. Any such RSUs will continue to vest on their applicable vesting schedule, subject to noncompetition and other terms. Over time a greater number of employees may become retirement eligible and the related requisite service period over which we will expense these awards will be shorter than the stated vesting period. Any unvested RSUs are eligible to receive dividends in kind; however, the right to dividends in kind will be forfeited if the underlying award does not vest.

Income Taxes

Income Taxes — The Company accounts for income taxes in accordance with ASC 740, “Accounting for Income Taxes” (“ASC 740”), which requires the recognition of tax benefits or expenses on temporary differences between the financial reporting and tax bases of its assets and liabilities by applying the enacted tax rates in effect for the year in which the differences are expected to reverse. Such net tax effects on temporary differences are reflected on the Company’s condensed consolidated statements of financial condition as deferred tax assets and liabilities. Deferred tax assets are reduced by a valuation allowance when the Company believes that it is more-likely-than-not that some portion or all of the deferred tax assets will not be realized.

ASC 740-10 prescribes a two-step approach for the recognition and measurement of tax benefits associated with the positions taken or expected to be taken in a tax return that affect amounts reported in the financial statements. The Company has reviewed and will continue to review the conclusions reached regarding uncertain tax positions, which may be subject to review and adjustment at a later date based on ongoing analyses of tax laws, regulations and interpretations thereof. For the three months ended March 31, 2021 and 2020, no unrecognized tax benefit was recorded. To the extent that the Company’s assessment of the conclusions reached regarding uncertain tax positions changes as a result of the evaluation of new information, such change in estimate will be recorded in the period in which such determination is made. The Company reports income tax-related interest and penalties relating to uncertain tax positions, if applicable, as a component of income tax expense. For the three months ended March 31, 2021 and 2020, no such amounts were recorded.

The Company recognizes excess tax benefits and deficiencies as income tax benefits or expenses in the condensed consolidated statement of operations. These are reflected in accounts payable, accrued expenses and other liabilities within the condensed consolidated statement of cash flows.

Effective January 1, 2021, the Company adopted Accounting Standards Update No. 2019-12, “Income Taxes” (“ASU 2019-12”). ASU 2019-12 removes certain rule exceptions to simplify accounting for income taxes. ASU 2019-12 has been incorporated into our provision for income taxes calculation and does not have a material impact to our overall income taxes.

Foreign Currency Translation

Foreign Currency Translation — Assets and liabilities held in non-U.S. dollar denominated currencies are translated into U.S. dollars at exchange rates in effect at the end of the reporting period. Revenues and expenses are translated at average exchange rates during the reporting period. A charge or credit is recorded to other comprehensive income to reflect the translation of these amounts to the extent the non-U.S. currency is designated the functional currency of the subsidiary. Non-functional currency related transaction gains and losses are immediately recorded in the condensed consolidated statements of operations.

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Summary of Significant Accounting Policies (Tables)

3 Months Ended

Mar. 31, 2021

Accounting Policies [Abstract]

Summary of Cash, Cash Equivalents and Restricted Cash

A reconciliation of the Company’s cash, cash equivalents and restricted cash as of March 31, 2021 and 2020, is presented below.

	March 31,
	2021		2020
Cash	$	97,899	$	38,975
Cash equivalents		57,503		85,183
Restricted cash		1,081		597
Total cash, cash equivalents, and restricted cash shown in the statement of cash flows	$	156,483	$	124,755

Summary of Credit Loss Allowance Activity

The following tables summarize credit loss allowance activity for the three months ended March 31, 2021 and March 31, 2020:

	Three Months Ended March 31, 2021
	Accounts Receivable
		Short-term Receivables				Private Funds Advisory Receivables			Total
Allowance for Credit Losses, beginning balance	$		3,577		$		198	$		3,775
Charge-offs			(741	)			—			(741	)
Recoveries			(1,126	)			—			(1,126	)
Reduction to allowance			(1,867	)			—			(1,867	)
Provision for credit losses			4,253				22			4,275
Allowance for credit losses, ending balance	$		5,963		$		220	$		6,183

	Three Months Ended March 31, 2020
	Accounts Receivable
		Short-term Receivables				Private Funds Advisory Receivables				Total
Allowance for Credit Losses, beginning balance	$		4,088		$		—		$		4,088
Adjustment for adoption of ASU 2016-13			260				199				459
Allowance for Credit Losses, adjusted beginning balance			4,348				199				4,547
Charge-offs			(1,289	)			—				(1,289	)
Recoveries			(724	)			(26	)			(750	)
Reduction to allowance			(2,013	)			(26	)			(2,039	)
Provision for credit losses			1,216				52				1,268
Allowance for credit losses, ending balance	$		3,551		$		225		$		3,776

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Fixed and Intangible Assets (Tables)

3 Months Ended

Mar. 31, 2021

Property Plant And Equipment [Abstract]

Schedule of Equipment and Leasehold Improvements, Net

Equipment and leasehold improvements, net consists of the following:

	March 31,			December 31,
	2021			2020
Office equipment	$	13,286		$	13,267
Furniture and fixtures		10,529			10,409
Leasehold improvements		36,548			36,286
Construction in progress		18,078			14,943
Total		78,441			74,905
Less accumulated depreciation and amortization		(26,374	)		(24,928	)
Equipment and leasehold improvements, net	$	52,067		$	49,977

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Investments (Tables)

3 Months Ended

Mar. 31, 2021

Investments All Other Investments [Abstract]

Summary of the Levels of the Fair Value Hierarchy into Which the Company's Financial Assets Fall

The following table summarizes the levels of the fair value hierarchy into which the Company’s financial assets fall as of March 31, 2021:

	Total		Level 1			Level 2		Level 3
Financial assets:
Included in cash and cash equivalents
U.S. treasury instruments	$	17,000	$	—		$	17,000	$	—
Money market securities		40,503		—			40,503		—
Investments
U.S. treasury instruments		72,262			—		72,262		—
Total financial assets	$	129,765	$		—	$	129,765	$		—

The following table summarizes the levels of the fair value hierarchy into which the Company’s financial assets fall as of December 31, 2020:

	Total		Level 1			Level 2		Level 3
Financial assets:
Included in cash and cash equivalents
U.S. treasury instruments	$	15,599	$		—	$	15,599	$	—
Money market securities		103,406		—			103,406		—
Investments
U.S. treasury instruments		172,671		—			172,671		—
Total financial assets	$	291,676	$		—	$	291,676	$		—

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Net Income (Loss) Per Share Attributable to Class A Common Shareholders (Tables)

3 Months Ended

Mar. 31, 2021

Earnings Per Share [Abstract]

Schedule of Calculations of Basic and Diluted Net Income (Loss) Per Share

The calculations of basic and diluted net income (loss) per share attributable to holders of shares of Class A common stock for the three months ended March 31, 2021 and 2020 are presented below.

	Three Months Ended March 31,
(dollars in thousands, except per share amounts)	2021			2020
Numerator:
Net income (loss) attributable to holders of shares of Class A common stock—basic	$	66,529		$	25,130
Add (deduct) dilutive effect of:
Noncontrolling interests related to Class A partnership units			(a)			(a)
Net income (loss) attributable to holders of shares of Class A common stock—diluted	$	66,529		$	25,130
Denominator:
Weighted average shares of Class A common stock outstanding—basic		60,932,966			52,666,457
Add (deduct) dilutive effect of:
Noncontrolling interests related to Class A partnership units			(a)			(a)
Weighted average number of incremental shares issuable from unvested RSUs and stock options, as calculated using the treasury stock method		5,427,251	(b)		4,426,525	(b)
Weighted average shares of Class A common stock outstanding—diluted		66,360,217			57,092,982
Net income (loss) per share attributable to holders of shares of Class A common stock
Basic	$	1.09		$	0.48
Diluted	$	1.00		$	0.44

We have not included the impact of Class B common stock because these shares are entitled to an insignificant amount of economic participation.

(a) Class A partnership units may be exchanged for Moelis & Company Class A common stock on a one-for-one basis, subject to applicable exchange restrictions. If all Class A partnership units were to be exchanged for Class A common stock, fully diluted Class A common stock outstanding would be 74,625,284 and 70,051,004 for the three months ended March 31, 2021 and 2020, respectively. In computing the dilutive effect, if any, that the aforementioned exchange would have on net income (loss) per share, net income (loss) available to holders of Class A common stock would be adjusted due to the elimination of the noncontrolling interests in consolidated entities associated with the Group LP Class A partnership units (including any tax impact). For the three months ended March 31, 2021 and 2020, such exchange is not reflected in diluted net income (loss) per share as the assumed exchange is not dilutive.

(b) Certain shares of Moelis & Company’s Class A common stock assumed to be issued pursuant to certain RSUs as calculated using the treasury stock method were antidilutive and therefore have been excluded from the calculation of diluted net income (loss) per share attributable to Moelis & Company for certain periods. The additional weighted average amount of RSUs that would have been included in the treasury stock method calculation if the effect were dilutive would have been 1,539 and 1,613,603 units for the three months ended March 31, 2021 and 2020, respectively.

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Equity-Based Compensation (Tables)

3 Months Ended

Mar. 31, 2021

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Summary of Activity Related to RSUs and Other Stock-based Awards

The following table summarizes activity related to RSUs and other stock-based awards for the three months ended March 31, 2021 and 2020.

	RSUs and Other Stock-based Awards
	2021					2020
				Weighted					Weighted
				Average					Average
	Number of			Grant Date		Number of			Grant Date
	Shares			Fair Value		Shares			Fair Value
Unvested Balance at January 1,		8,742,695		$	41.45		8,414,130		$	42.19
Granted		3,100,355			54.74		3,585,725			37.93
Forfeited		(34,974	)		48.44		(48,512	)		37.00
Vested		(3,689,539	)		42.86		(2,894,992	)		38.67
Unvested Balance at March 31,		8,118,537		$	46.43		9,056,351		$	41.53

Schedule of Assumptions Used to Estimate the Fair Value of Stock Option Using the Black-Scholes Valuation model

The Company estimated the fair value of stock option awards at grant using the Black-Scholes valuation model with the following assumptions:

	Assumptions
Expected life (in years)		6
Weighted-average risk free interest rate		1.91	%
Expected volatility		35	%
Dividend yield		2.72	%
Weighted-average fair value at grant date	$	6.70

Summary of Activity Related to Stock Options

The following table summarizes activity related to stock options for the three months ended March 31, 2020:

	Stock Options Outstanding
	2020
				Weighted
				Average
	Number			Exercise Price
	Outstanding			Per Share
Outstanding at January 1,		728,534		$	15.95
Exercises		(722,034	)		15.95
Forfeitures or expirations		—			—
Outstanding at March 31,		6,500		$	15.95

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Commitments and Contingencies (Tables)

3 Months Ended

Mar. 31, 2021

Commitments And Contingencies Disclosure [Abstract]

Schedule of Additional Leases Information

See below for additional information about the Company’s leases.

	Three Months Ended
	March 31,
($ in thousands)	2021			2020
Supplemental Income Statement Information:
Operating lease cost	$	7,154		$	6,365
Supplemental Cash Flow Information:
Cash paid for amounts included in the measurement of lease liabilities:
Net operating cash outflows for operating leases	$	5,980		$	5,299
Right-of-use assets obtained in exchange for lease obligations (e.g. new leases and amendments commenced during the period):	$	321		$	2,414
Other Information
Weighted-average remaining lease term - operating leases		13.69	years		13.82	years
Weighted-average discount rate - operating leases		3.52	%		3.53	%

Schedule of Future Sublease Income and Maturities of Our Operating Lease Liabilities

The future sublease income and maturities of our operating lease liabilities as of March 31, 2021, are as follows:

Fiscal year ended	Sublease Income			Operating Leases
Remainder of 2021	$	(689	)	$	14,323
2022		(919	)		24,214
2023		(919	)		20,971
2024		(919	)		19,085
2025		(459	)		16,326
Thereafter		-			177,587
Total Payments	$	(3,905	)	$	272,506
Less: Tenant improvement allowances					(18,440	)
Less: Present value adjustment					(60,190	)
Total				$	193,876

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Revenues and Business Information (Tables)

3 Months Ended

Mar. 31, 2021

Segment Reporting [Abstract]

Schedule of Geographical Distribution of Revenues and Assets

	Three Months Ended March 31,
	2021		2020
Revenues:
United States	$	206,252	$	129,185
Europe		43,716		16,256
Rest of World		13,898		8,265
Total	$	263,866	$	153,706

	March 31,		December 31,
	2021		2020
Assets:
United States	$	899,075	$	1,012,831
Europe		87,404		78,470
Rest of World		84,618		105,143
Total	$	1,071,097	$	1,196,444

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Summary of Significant Accounting Policies - Summary of Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020	Mar. 31, 2020	Dec. 31, 2019
Cash and Cash Equivalents
Cash	$ 97,899	$ 83,472	$ 38,975
Cash equivalents	57,503	119,005	85,183
Restricted cash	1,081	807	597
Total cash, cash equivalents, and restricted cash shown in the statement of cash flows	$ 156,483	$ 203,284	$ 124,755	$ 168,572

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Summary of Significant Accounting Policies - Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020	Dec. 31, 2020	Jan. 01, 2020	Dec. 31, 2019
Accounting Policies [Line Items]
Cash	$ 97,899	$ 38,975	$ 83,472
Cash equivalents	57,503	85,183	119,005
Long-term receivables	21,774		19,603
Interest income from long-term receivables	204	188
Cumulative effect on retained earnings	$ 460,580	352,556	444,473		$ 393,827
Assets and Liabilities, Lessee
Percentage of tax benefits payable to partners under tax receivable agreement	85.00%
Remaining percentage of cash savings realized by the Company (as a percent)	15.00%
Revenue and Expense Recognition and Equity-Based Compensation
Minimum age of retiring employees required so that certain qualifying awards granted during employment will not be forfeited	56 years
Consecutive years of service of retiring employees required so that certain qualifying awards granted during employment will not be forfeited	5 years
Minimum total age and consecutive years of service of retiring employees required so that certain qualifying awards granted during employment will not be forfeited	65 years
Income Taxes
Unrecognized tax benefits	$ 0	0
Retained Earnings
Accounting Policies [Line Items]
Cumulative effect on retained earnings	$ (393,166)	$ (378,817)	$ (420,682)		(324,192)
Cumulative Effect Adjustment Upon Adoption
Accounting Policies [Line Items]
Cumulative effect on retained earnings					(364)
Cumulative Effect Adjustment Upon Adoption | Retained Earnings
Accounting Policies [Line Items]
Cumulative effect on retained earnings					$ (364)
ASU 2016-13 | Cumulative Effect Adjustment Upon Adoption, Before Tax | Retained Earnings
Accounting Policies [Line Items]
Cumulative effect on retained earnings				$ (459)
ASU 2016-13 | Cumulative Effect Adjustment Upon Adoption, Tax | Retained Earnings
Accounting Policies [Line Items]
Cumulative effect on retained earnings				95
ASU 2016-13 | Cumulative Effect Adjustment Upon Adoption | Retained Earnings
Accounting Policies [Line Items]
Cumulative effect on retained earnings				$ (364)
Minimum
Accounting Policies [Line Items]
Installment Period	3 years
Minimum | Office Equipment and Furniture and Fixtures
Assets and Liabilities, Lessee
Useful lives	3 years
Maximum
Accounting Policies [Line Items]
Installment Period	4 years
Maximum | Office Equipment and Furniture and Fixtures
Assets and Liabilities, Lessee
Useful lives	7 years

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Summary of Significant Accounting Policies - Summary of Credit Loss Allowance Activity (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Financing Receivable Allowance For Credit Losses [Line Items]
Allowance for Credit Losses, beginning balance	$ 3,775
Allowance for Credit Losses, adjusted beginning balance		$ 4,547
Charge-offs	(741)	(1,289)
Recoveries	(1,126)	(750)
Reduction to allowance	(1,867)	(2,039)
Provision for credit losses	4,275	1,268
Allowance for credit losses, ending balance	6,183	3,776
Previously Reported
Financing Receivable Allowance For Credit Losses [Line Items]
Allowance for Credit Losses, beginning balance		4,088
ASU 2016-13
Financing Receivable Allowance For Credit Losses [Line Items]
Allowance for Credit Losses, beginning balance		459
Short-term Receivables
Financing Receivable Allowance For Credit Losses [Line Items]
Allowance for Credit Losses, beginning balance	3,577
Allowance for Credit Losses, adjusted beginning balance		4,348
Charge-offs	(741)	(1,289)
Recoveries	(1,126)	(724)
Reduction to allowance	(1,867)	(2,013)
Provision for credit losses	4,253	1,216
Allowance for credit losses, ending balance	5,963	3,551
Short-term Receivables | Previously Reported
Financing Receivable Allowance For Credit Losses [Line Items]
Allowance for Credit Losses, beginning balance		4,088
Short-term Receivables | ASU 2016-13
Financing Receivable Allowance For Credit Losses [Line Items]
Allowance for Credit Losses, beginning balance		260
Private Funds Advisory Receivables
Financing Receivable Allowance For Credit Losses [Line Items]
Allowance for Credit Losses, beginning balance	198
Allowance for Credit Losses, adjusted beginning balance		199
Recoveries		(26)
Reduction to allowance		(26)
Provision for credit losses	22	52
Allowance for credit losses, ending balance	$ 220	225
Private Funds Advisory Receivables | ASU 2016-13
Financing Receivable Allowance For Credit Losses [Line Items]
Allowance for Credit Losses, beginning balance		$ 199

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Fixed and Intangible Assets - Schedule of Equipment and Leasehold Improvements, Net (Details) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Equipment and Leasehold Improvements, Net
Total	$ 78,441	$ 74,905
Less accumulated depreciation and amortization	(26,374)	(24,928)
Equipment and leasehold improvements, net	52,067	49,977
Office Equipment
Equipment and Leasehold Improvements, Net
Total	13,286	13,267
Furniture and Fixtures
Equipment and Leasehold Improvements, Net
Total	10,529	10,409
Leasehold Improvements
Equipment and Leasehold Improvements, Net
Total	36,548	36,286
Construction in progress
Equipment and Leasehold Improvements, Net
Total	$ 18,078	$ 14,943

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Fixed and Intangible Assets - Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Equipment and Leasehold Improvements, Net
Depreciation and amortization expenses	$ 1,449	$ 1,199
Prepaid Expenses and Other Assets
Equipment and Leasehold Improvements, Net
Costs capitalized	2,493
Communication, Technology and Information Services
Equipment and Leasehold Improvements, Net
Amortization expense of capitalized costs	$ 122	$ 0

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Investments - Summary of the Levels of the Fair Value Hierarchy into Which the Company's Financial Assets Fall (Details) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Fair value measurements
Total financial assets	$ 129,765	$ 291,676
U.S. Treasury Instruments
Fair value measurements
Cash and cash equivalents	17,000	15,599
Investments in securities	72,262	172,671
Money Market Securities
Fair value measurements
Cash and cash equivalents	40,503	103,406
Level 2
Fair value measurements
Total financial assets	129,765	291,676
Level 2 | U.S. Treasury Instruments
Fair value measurements
Cash and cash equivalents	17,000	15,599
Investments in securities	72,262	172,671
Level 2 | Money Market Securities
Fair value measurements
Cash and cash equivalents	$ 40,503	$ 103,406

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Investments - Additional Information (Details) - USD ($) $ in Thousands					3 Months Ended
	Mar. 04, 2021	Feb. 17, 2021	Mar. 04, 2020	Feb. 19, 2020	Mar. 31, 2021	Mar. 31, 2020	Dec. 31, 2021	Dec. 31, 2020	Apr. 01, 2010
Schedule of Investments
Investments at fair value, cost basis					$ 72,258			$ 172,640
Dividends received					2,279	$ 1,942
Equity method investments					38,754			38,143
Corporate Joint Venture
Schedule of Investments
Ownership percentage									50.00%
Dividends received	$ 2,279	$ 2,279	$ 1,942	$ 1,942
Common Stock
Schedule of Investments
Unrealized gain (loss) on equity securities						$ (25)
Atlas Crest I
Schedule of Investments
Investments at fair value, cost basis					$ 7,427			$ 887
Atlas Crest II | Subsequent Event
Schedule of Investments
Investments at fair value, cost basis							$ 660
Atlas Crest III | Subsequent Event
Schedule of Investments
Investments at fair value, cost basis							2,788
Atlas Crest IV | Subsequent Event
Schedule of Investments
Investments at fair value, cost basis							1,960
Atlas Crest V | Subsequent Event
Schedule of Investments
Investments at fair value, cost basis							$ 1,132

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Net Income (Loss) Per Share Attributable to Class A Common Shareholders - Schedule of Calculations of Basic and Diluted Net Income (Loss) Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Numerator:
Net income (loss) attributable to holders of shares of Class A common stock—basic	$ 66,529	$ 25,130
Class A Common Stock
Numerator:
Net income (loss) attributable to holders of shares of Class A common stock—basic	66,529	25,130
Add (deduct) dilutive effect of:
Net income (loss) attributable to holders of shares of Class A common stock—diluted	$ 66,529	$ 25,130
Denominator:
Weighted average shares of Class A common stock outstanding—basic	60,932,966	52,666,457
Add (deduct) dilutive effect of:
Weighted average number of incremental shares issuable from unvested RSUs and stock options, as calculated using the treasury stock method	5,427,251	4,426,525
Weighted average shares of Class A common stock outstanding—diluted	66,360,217	57,092,982
Net income (loss) per share attributable to holders of shares of Class A common stock
Basic (in dollars per share)	$ 1.09	$ 0.48
Diluted (in dollars per share)	$ 1.00	$ 0.44

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Net Income (Loss) Per Share Attributable to Class A Common Shareholders - Schedule of Calculations of Basic and Diluted Net Income (Loss) Per Share (Parenthetical) (Details) - Class A Common Stock - shares	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Earnings Per Share Basic [Line Items]
Number of shares of common stock to be issued upon exchange of a partnership unit	1
Fully diluted shares of common stock outstanding if all Class A partnership units were to be exchanged for common stock immediately following the reorganization	74,625,284	70,051,004
Restricted Stock and RSUs
Earnings Per Share Basic [Line Items]
Number of antidilutive securities excluded from calculation of diluted income (loss) per share	1,539	1,613,603

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Equity-Based Compensation - Additional Information (Details) - USD ($)	1 Months Ended	3 Months Ended		9 Months Ended	12 Months Ended	84 Months Ended
	Apr. 30, 2014	Mar. 31, 2021	Mar. 31, 2020	Sep. 30, 2020	Dec. 31, 2014	Mar. 31, 2021	Dec. 31, 2020	Apr. 30, 2020	Feb. 28, 2019	Nov. 09, 2014
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Compensation expenses		$ 50,963,000	$ 38,225,000
Pre IPO Partnership Units
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Compensation expenses		0	30,000
RSUs and Other Stock-based Awards
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Total compensation expense not yet recognized		$ 221,171,000				$ 221,171,000
Weighted average period to recognize compensation expense		2 years 2 months 12 days
RSUs and Other Stock-based Awards | Minimum
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Vesting period				4 years
RSUs and Other Stock-based Awards | Maximum
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Vesting period				5 years
Stock Options
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Compensation expenses		$ 0	$ 0
Vesting period					5 years
Grants (in shares)	3,501,881
Special dividends paid (in dollars per share)						$ 9.05
Reduction to exercise price of options outstanding due to special dividend paid (in dollars per share)						9.05
Exercise price (in dollars per share)		$ 15.95				$ 15.95	$ 15.95			$ 25.00
Stock options outstanding		6,500				6,500	728,534	0
Class A Common Stock
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Number of shares of common stock to be issued upon exchange of a partnership unit		1				1
Class A Common Stock | Share Repurchase Plan
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Share value authorized for repurchase									$ 100,000,000
Value of remaining shares authorized for repurchase		$ 73,601,000,000				$ 73,601,000,000

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Equity-Based Compensation - Summary of Activity Related to RSUs and Other Stock-based Awards (Details) - RSUs and Other Stock-based Awards - $ / shares	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Number of Shares
Unvested Balance at the beginning of the period	8,742,695	8,414,130
Granted	3,100,355	3,585,725
Forfeited	(34,974)	(48,512)
Vested	(3,689,539)	(2,894,992)
Unvested Balance at the end of the period	8,118,537	9,056,351
Weighted Average Grant Date Fair Value
Unvested Balance at the beginning of the period	$ 41.45	$ 42.19
Granted	54.74	37.93
Forfeited	48.44	37.00
Vested	42.86	38.67
Unvested Balance at the end of the period	$ 46.43	$ 41.53

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Equity-Based Compensation - Schedule of Assumptions Used to Estimate the Fair Value of Stock Option Using Black-Scholes Valuation Model (Details)	3 Months Ended
	Mar. 31, 2021 $ / shares
Assumptions Used to Estimate Fair Value
Expected life (in years)	6 years
Weighted-average risk free interest rate	1.91%
Expected volatility	35.00%
Dividend yield	2.72%
Weighted-average fair value at grant date	$ 6.70

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Equity-Based Compensation - Summary of Activity Related to Stock Options (Details) - Stock Options	3 Months Ended
	Mar. 31, 2021 $ / shares shares
Number Outstanding
Outstanding at January 1, | shares	728,534
Exercises | shares	(722,034)
Outstanding at March 31, | shares	6,500
Weighted-Average Exercise Price Per Share
Outstanding at January 1, | $ / shares	$ 15.95
Exercises | $ / shares	15.95
Outstanding at March 31, | $ / shares	$ 15.95

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Stockholders Equity - Additional Information (Details) $ in Thousands	1 Months Ended		3 Months Ended
	Nov. 30, 2014	Apr. 30, 2014 shares	Mar. 31, 2021 USD ($) shares	Mar. 31, 2020 USD ($) shares	Dec. 31, 2020 shares
Class Of Stock [Line Items]
Treasury stock, shares			5,323,017		3,959,083
Treasury stock shares acquired (in shares)			1,363,934	869,779
Treasury stock shares acquired | $			$ 74,211	$ 31,636
Number of units held by noncontrolling interest holders			7,855,398		8,508,857
Group LP
Class Of Stock [Line Items]
Noncontrolling interests (as a percent)			11.00%		13.00%
Class A Common Stock
Class Of Stock [Line Items]
Aggregate stock issuance (in shares)		15,263,653
Increase in shares outstanding		24,923,349
Common stock, shares issued			66,648,561		61,986,927
Treasury stock, shares			5,323,017		3,959,083
Common stock, shares outstanding			61,325,544		58,027,844
Number of shares of common stock to be issued upon exchange of a partnership unit			1
Class A Common Stock | Group LP
Class Of Stock [Line Items]
Common stock, shares outstanding			61,325,544		58,027,844
Class B Common Stock
Class Of Stock [Line Items]
Increase in shares outstanding		36,158,698
Common stock, shares issued			4,899,457		5,948,750
Common stock, shares outstanding			4,899,457		5,948,750
Ratio of subscription price to the initial public offering price of shares of common stock	0.00055
Dividends payable ratio to outstanding shares of publicly traded common stock	0.00055
Stock purchased			24,919,744
Purchase cost | $			$ 550

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Related-Party Transactions - Additional Information (Details) - USD ($)	1 Months Ended	3 Months Ended		12 Months Ended
	Feb. 28, 2021	Mar. 31, 2021	Mar. 31, 2020	Dec. 31, 2020
Related-party transactions
Principal repayments		$ 70,000
Manager | Aircraft Lease Entered into During August 2014
Related-party transactions
Expenses		324,000	$ 324,000
Employees
Related-party transactions
Unsecured promissory notes from employees		319,000	389,000
Employees | Unsecured Promissory Notes
Related-party transactions
Principal repayments		70,000	0
Interest income recognized		$ 5,000	2,000
Employees | Minimum | Unsecured Promissory Notes
Related-party transactions
Interest rates (as a percent)		3.00%
Employees | Maximum | Unsecured Promissory Notes
Related-party transactions
Interest rates (as a percent)		4.00%
Moelis Asset Management LP
Related-party transactions
Fee for services		$ 57,000	110,000
Due from related party		0	0
Revenue from related parties		0	$ 0
Atlas Crest I
Related-party transactions
Fee for services		50,000
Due from related party		0		$ 0
Atlas Crest I
Related-party transactions
Fee for services				10,000
Atlas Crest II
Related-party transactions
Fee for services	$ 10,000
Corporate Joint Venture
Related-party transactions
Due to related party		$ 5,000		$ 5,000

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Regulatory Requirements - Additional Information (Details) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Regulatory Requirements
Minimum net capital requirement	$ 250
Moelis US
Regulatory Requirements
Net capital	101,232	$ 96,800
Net capital in excess of required net capital	$ 100,982	$ 96,550

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Commitments and Contingencies - Additional Information (Details) - USD ($)		3 Months Ended
	Apr. 20, 2020	Mar. 31, 2021	Dec. 31, 2020
Bank line of credit
Available credit under the facility		$ 60,507,000
Revolving Credit Facility
Bank line of credit
Fixed rate of interest (as a percent)		3.50%
Borrowings under the credit facility		$ 0	$ 0
Standby Letters of Credit
Bank line of credit
Letters of credit outstanding		$ 4,493,000
Fee on the outstanding balances (as a percent)		1.00%
LIBOR | Revolving Credit Facility
Bank line of credit
Interest rate margin (as a percent)		1.00%
Reference rate (as a percent)		LIBOR
Prime | Revolving Credit Facility
Bank line of credit
Interest rate margin (as a percent)		(1.50%)
Reference rate (as a percent)		Prime
Secured Bank Line of Credit
Bank line of credit
Commitment amount	$ 65,000,000
Minimum Days To Issues Termination Notice	60 days

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Commitments and Contingencies - Schedule of Additional Leases Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Supplemental Income Statement Information:
Operating lease cost	$ 7,154	$ 6,365
Cash paid for amounts included in the measurement of lease liabilities:
Net operating cash outflows for operating leases	5,980	5,299
Right-of-use assets obtained in exchange for lease obligations (e.g. new leases and amendments commenced during the period):	$ 321	$ 2,414
Other Information
Weighted-average remaining lease term - operating leases	13 years 8 months 8 days	13 years 9 months 25 days
Weighted-average discount rate - operating leases	3.52%	3.53%

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Commitments and Contingencies - Schedule of Future Minimum Rental Payments Required Under Operating Leases in Place (Details) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Sublease Income
Remainder of 2021	$ (689)
2022	(919)
2023	(919)
2024	(919)
2025	(459)
Total Payments	(3,905)
Operating Leases
Remainder of 2021	14,323
2022	24,214
2023	20,971
2024	19,085
2025	16,326
Thereafter	177,587
Total Payments	272,506
Less: Tenant improvement allowances	(18,440)
Less: Present value adjustment	(60,190)
Operating Lease, Liability	$ 193,876	$ 196,614

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Employee Benefit Plans - Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Compensation And Retirement Disclosure [Abstract]
Minimum age required to be eligible to participate in the 401(k) plan	21 years
Expenses accrued relating to employer matching contributions	$ 715	$ 696

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Income Taxes - Additional Information (Details) - USD ($) $ in Thousands	1 Months Ended	3 Months Ended
	Feb. 28, 2021	Mar. 31, 2021	Mar. 31, 2020
Income Tax Disclosure [Abstract]
Provision (benefit) for income taxes		$ (176)	$ (7,344)
Effective tax rate (as a percent)		(0.20%)	(32.20%)
Excess tax benefits		$ 17,542	$ 7,337
Increase in the net deferred tax asset	$ 19,392
Percentage of portion of deferred tax asset payable to exchanging partners	85.00%
Portion of deferred tax asset payable to exchanging partners	$ 16,483
Portion of deferred tax asset payable to exchanging partners, period	15 years

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Revenues and Business Information - Schedule of Geographical Distribution of Revenues and Assets (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020	Dec. 31, 2020
Revenues From External Customers And Long Lived Assets [Line Items]
Revenues	$ 263,866	$ 153,706
Total assets	1,071,097		$ 1,196,444
United States
Revenues From External Customers And Long Lived Assets [Line Items]
Revenues	206,252	129,185
Total assets	899,075		1,012,831
Europe
Revenues From External Customers And Long Lived Assets [Line Items]
Revenues	43,716	16,256
Total assets	87,404		78,470
Rest of World
Revenues From External Customers And Long Lived Assets [Line Items]
Revenues	13,898	$ 8,265
Total assets	$ 84,618		$ 105,143

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Revenues and Business Information - Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Dec. 31, 2020
Segment Reporting [Abstract]
Deferred revenue	$ 8,105	$ 2,692
Revenues recognized from opening balance of deferred revenues	$ 1,682

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Subsequent Events - Additional Information (Details) - Subsequent Event	Apr. 27, 2021 $ / shares
Subsequent Event [Line Items]
Special dividends paid (in dollars per share)	$ 2.00
Regular quarterly dividend declared	0.55
Dividends declared per share	$ 2.55
Dividend payable date	Jun. 18, 2021
Dividend payable record date	May 10, 2021