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Consolidated Investment Products (Tables)

6 Months Ended

Jun. 30, 2016

Consolidated Investment Products [Abstract]



	As of
$ in millions	June 30, 2016		December 31, 2015
Cash and cash equivalents of CIP	257.9		363.3
Accounts receivable and other assets of CIP	182.2		173.5
Investments of CIP	4,036.9		6,016.1
Less: Debt of CIP	(3,529.6	)	(5,437.0	)
Less: Other liabilities of CIP	(314.0	)	(273.7	)
Less: Retained earnings	22.4		20.1
Less: Accumulated other comprehensive income, net of tax	(18.9	)	(20.1	)
Less: Equity attributable to redeemable noncontrolling interests	(312.6	)	—
Less: Equity attributable to nonredeemable noncontrolling interests	(73.3	)	(768.8	)
Invesco's net interests in CIP	251.0		73.4

Condensed Consolidating Statement Of Income Line Items Reflecting Impact Of Consolidation Of Investment Products Into The Condensed Consolidated Statements Of Income

The following tables reflect the impact of consolidation of investment products into the Condensed Consolidated Statements of Income for the three and six months ended June 30, 2016 and 2015:



	Three months ended June 30,
$ in millions	2016		2015
Total operating revenues	(5.1	)	(10.4	)
Total operating expenses	7.9		1.5
Operating income	(13.0	)	(11.9	)
Equity in earnings of unconsolidated affiliates	(5.1	)	0.5
Interest and dividend income	—		(0.8	)
Other gains and losses, net	(0.8	)	(1.2	)
Interest and dividend income of CIP	46.2		65.1
Interest expense of CIP	(33.3	)	(47.3	)
Other gains/(losses) of CIP, net	25.0		(19.7	)
Income before income taxes	19.0		(15.3	)
Income tax provision	—		—
Net income	19.0		(15.3	)
Net (income)/loss attributable to noncontrolling interests in consolidated entities	(11.0	)	15.7
Net income attributable to Invesco Ltd.	8.0		0.4



	Six months ended June 30,
$ in millions	2016		2015
Total operating revenues	(10.6	)	(19.7	)
Total operating expenses	9.7		13.7
Operating income	(20.3	)	(33.4	)
Equity in earnings of unconsolidated affiliates	(1.6	)	(1.2	)
Interest and dividend income	(0.2	)	(2.2	)
Other gains and losses, net	(0.9	)	(3.9	)
Interest and dividend income of CIP	90.6		125.3
Interest expense of CIP	(60.6	)	(92.4	)
Other gains/(losses) of CIP, net	0.4		4.7
Income before income taxes	7.4		(3.1	)
Income tax provision	—		—
Net income	7.4		(3.1	)
Net (income)/loss attributable to noncontrolling interests in consolidated entities	(7.8	)	(4.7	)
Net income attributable to Invesco Ltd.	(0.4	)	(7.8	)

Transition date impact of adoption of ASU 2015-02



	Transition date impact
$ in millions	Consolidated	Deconsolidated
Cash and cash equivalents of CIP	33.8	163.8
Accounts receivable and other assets of CIP	105.4	68.8
Investments of CIP	319.3	2,938.0
Total assets	458.5	3,170.6

Debt of CIP	—	2,259.2
Other liabilities of CIP	102.4	110.4
Total liabilities	102.4	2,369.6
Total equity	356.1	801.0
Total liabilities and equity	458.5	3,170.6

Company's Maximum Risk Of Loss In Significant VIE's

At June 30, 2016, the company's carrying value and maximum risk of loss with respect to VIEs in which the company is not the primary beneficiary was $277.9 million.

VIE Balance Sheets Consolidated In Period



	For the six months ended June 30, 2016	For the six months ended June 30, 2015
$ in millions	VIEs	VIEs	VOEs
Cash and cash equivalents of CIP	151.0	209.2	10.0
Accounts receivable and other assets of CIP	3.6	1.5	—
Investments of CIP	311.0	567.0	—
Total assets	465.6	777.7	10.0

Debt of CIP	414.4	601.4	—
Other liabilities of CIP	17.4	176.3	—
Total liabilities	431.8	777.7	—
Total equity	33.8	—	10.0
Total liabilities and equity	465.6	777.7	10.0

During the six months ended June 30, 2016, the company determined that it was no longer the primary beneficiary of four VIEs. The amounts deconsolidated from the Condensed Consolidated Balance Sheet are illustrated in the table below. There was no net impact to the Condensed Consolidated Statement of Income for the six months ended June 30, 2016 from the deconsolidation of the investment product.



	For the six months ended June 30, 2016
$ in millions	VIEs
Cash and cash equivalents of CIP	23.6
Accounts receivable and other assets of CIP	12.2
Investments of CIP	196.1
Total assets	231.9

Debt of CIP	—
Other liabilities of CIP	13.1
Total liabilities	13.1
Total equity	218.8
Total liabilities and equity	231.9

Fair Value Hierarchy Levels Of Investments Held And Notes Issued By Consolidated Investment Products

The following tables present the fair value hierarchy levels of certain CIP balances which are measured at fair value as of June 30, 2016 and December 31, 2015:



	As of June 30, 2016
$ in millions	Fair Value Measurements	Quoted Prices in Active Markets for Identical Assets (Level 1)	Significant Other Observable Inputs (Level 2)	Significant Unobservable Inputs (Level 3)	Investments Measured at NAV as a practical expedient
Assets:
Bank loans	3,485.3	—	3,485.3	—	—
Bonds	354.7	—	354.7	—	—
Equity securities	67.9	66.2	1.7	—	—
Equity and fixed income mutual funds	49.2	49.2	—	—	—
Investments in other private equity funds	55.9	—	—	—	55.9
Real estate investments	23.9	—	—	23.9	—
Total assets at fair value	4,036.9	115.4	3,841.7	23.9	55.9



	As of December 31, 2015
$ in millions	Fair Value Measurements	Quoted Prices in Active Markets for Identical Assets (Level 1)	Significant Other Observable Inputs (Level 2)	Significant Unobservable Inputs (Level 3)	Investments Measured at NAV as a practical expedient
Assets:
CLO collateral assets:
Bank loans	5,179.6	—	5,179.6	—	—
Bonds	71.1	—	71.1	—	—
Equity securities	0.9	—	0.9	—	—
Private equity fund assets:
Equity securities	364.6	7.7	—	356.9	—
Debt Securities	31.7	—	—	31.7	—
Investments in other private equity funds	368.2	—	—	—	368.2
Total assets at fair value	6,016.1	7.7	5,251.6	388.6	368.2

Beginning And Ending Fair Value Measurements For Level 3 Assets And Liabilities

The following tables show a reconciliation of the beginning and ending fair value measurements for level 3 assets and liabilities using significant unobservable inputs:



	Three months ended June 30, 2016		Six months ended June 30, 2016
$ in millions	Level 3 Assets	Level 3 Liabilities	Level 3 Assets		Level 3 Liabilities
Beginning balance	—	—	388.6		—
Adjustment for adoption of ASU 2014-13	—	—	—		—
Adjustment for adoption of ASU 2015-02	—	—	(388.6	)	—
Purchases	23.9	—	23.9		—
Sales	—	—	—		—
Gains and losses included in the Condensed Consolidated Statements of Income*	—	—	—		—
Transfers to Levels 1 and 2	—	—	—		—
Ending balance	23.9	—	23.9		—



	Three months ended June 30, 2015			Six months ended June 30, 2015
$ in millions	Level 3 Assets		Level 3 Liabilities	Level 3 Assets		Level 3 Liabilities
Beginning balance	343.1		—	363.9		(5,149.6	)
Adjustment for adoption of ASU 2014-13	—		—	—		—
Adjustment for adoption of ASU 2015-02	—		—	—		5,149.6
Purchases	2.1		—	19.2		—
Sales	(14.2	)	—	(41.2	)	—
Gains and losses included in the Condensed Consolidated Statements of Income*	(22.9	)	—	(25.4	)	—
Transfers to Levels 1 and 2**	—		—	(8.4	)	—
Ending balance	308.1		—	308.1		—

____________


*	Included in gains/(losses) of CIP, net in the Condensed Consolidated Statements of Income for the three and six months ended June 30, 2015 are $22.9 million and $25.4 million respectively, in net unrealized losses attributable to investments still held at June 30, 2015 by CIP.

Fair Value Inputs, Assets and Liabilities, Quantitative Information, Consolidated Investment Products



Assets and Liabilities *	Fair Value at December 31, 2015 ($ in millions)	Valuation Technique	Unobservable Inputs	Range	Weighted Average (by fair value)
Private Equity Funds --Equity Securities	320.0	Market Comparable	Revenue Multiple	NA	3.2x
			Discount	25% - 50%	25.0%
			Published valuation and/or broker quotes for similar types of assets	$25-101 million	$44.4 million

____________


*	Excluded from the table above are certain equity and debt securities held by consolidated private equity funds valued using recent private market transactions (December 31, 2015: $61.2 million) and third party appraisals (December 31, 2015: $7.3 million).

The table below summarizes as of June 30, 2016 and December 31, 2015, the nature of investments that are valued using the NAV as a practical expedient and any related liquidation restrictions or other factors which may impact the ultimate value realized.

June 30, 2016

December 31, 2015

in millions, except term data

Fair Value

Total Unfunded Commitments

Weighted Average Remaining Term ⁽²⁾

Fair Value

Total Unfunded Commitments

Weighted Average Remaining Term ⁽²⁾

Private equity funds ⁽¹⁾

$55.9

$52.5

6.7 years

$368.2

$218.1

2.8 years

____________


(1)	These investments are not subject to redemption; however, for certain funds, the investors may sell or transfer their interest, which may require approval by the general partner of the underlying funds.


(2)	These investments are expected to be returned through distributions as a result of liquidations of the funds' underlying assets over the weighted average periods indicated.

- Definition

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

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