Fair Value Measurements

6 Months Ended

Jun. 30, 2024

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair Value Measurements

The Company’s assets and liabilities measured at fair value on a recurring basis, excluding the assets and liabilities of CIP discussed in Note 16, as of June 30, 2024 and December 31, 2023 by fair value hierarchy level were as follows:

June 30, 2024  

(in thousands)	Level 1		Level 2		Level 3		Total
Assets
Cash equivalents	$	147,135	$	—	$	—	$	147,135
Investment securities - fair value
Sponsored funds	64,420		—		—		64,420
Equity securities	21,828		—		—		21,828
Nonqualified retirement plan assets	14,013		—		—		14,013
Total assets measured at fair value	$	247,396	$	—	$	—	$	247,396
Liabilities
Contingent consideration	$	—	$	—	$	38,408	$	38,408
Total liabilities measured at fair value	$	—	$	—	$	38,408	$	38,408

December 31, 2023  

(in thousands)	Level 1		Level 2		Level 3		Total
Assets
Cash equivalents	$	197,240	$	—	$	—	$	197,240
Investment securities - fair value
Sponsored funds	77,433		—		—		77,433
Equity securities	19,871		—		—		19,871
Nonqualified retirement plan assets	12,682		—		—		12,682
Total assets measured at fair value	$	307,226	$	—	$	—	$	307,226
Liabilities
Contingent consideration	$	—	$	—	$	56,200	$	56,200
Total liabilities measured at fair value	$	—	$	—	$	56,200	$	56,200

The following is a discussion of the valuation methodologies used for the Company’s assets measured at fair value:

Cash equivalents represent investments in money market funds. Cash investments in money market funds are valued using published net asset values and are classified as Level 1.

Sponsored funds represent investments in open-end funds and closed-end funds for which the Company acts as the investment manager. The fair values of U.S. retail funds and global funds are determined based on their published net asset values and are categorized as Level 1. The fair value of closed-end funds and ETFs is determined based on the official closing price on the exchange on which they are traded and are categorized as Level 1.

Equity securities represent securities traded on active markets, are valued at the official closing price (typically the last sale or bid) on the exchange on which the securities are primarily traded and are categorized as Level 1.

Nonqualified retirement plan assets represent mutual funds within the Company's nonqualified retirement plan whose fair value is determined based on their published net asset value and are categorized as Level 1.

Contingent consideration represents liabilities associated with contingent payment arrangements made in connection with the Company’s business combinations. In these contingent payment arrangements, the Company agrees to pay additional transaction consideration to the seller based on future performance. Contingent consideration is remeasured at fair value each reporting date using a simulation model with the assistance of an independent valuation firm and approved by management and are categorized as Level 3.

The following table presents a reconciliation of beginning and ending balances of the Company's contingent consideration liabilities:

	Three Months Ended June 30,				Six Months Ended June 30,
(in thousands)	2024		2023		2024		2023
Contingent consideration, beginning of period	$	41,708	$	61,710	$	56,200	$	78,100
Reduction for payments made	—		—		(14,492)		(16,390)
Increase (reduction) of liability related to re-measurement of fair value	(3,300)		(6,800)		(3,300)		(6,800)
Contingent consideration, end of period	$	38,408	$	54,910	$	38,408	$	54,910

The contingent consideration related to the Westchester Capital Management transaction as of June 30, 2024, was $7.8 million measured using an options pricing model valuation technique. The most significant unobservable inputs used relate to revenue growth rates, discount rates (range of 6%-7%) and the market price of risk adjustment (9%). The NFJ Investment Group contingent consideration liability as of June 30, 2024, was $30.6 million measured using an options pricing model valuation technique. The most significant unobservable inputs used relate to the revenue growth rates, discount rates (range of 6% - 7%) and the market price of risk adjustment (7%).

Cash, accounts receivable, accounts payable and accrued liabilities equal or approximate fair value based on the short-term nature of these instruments.