UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 ________________________________________
FORM 10-Q

 
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended SeptemberJune 30, 20222023
or
TRANSITION REPORT PURSUANT TO SECTION 13 OF 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from_________to ________
Commission File Number: 0-10200
________________________________________ 
SEILogo.jpg
________________________________________
SEI INVESTMENTS COMPANY
(Exact Name of Registrant as Specified in its Charter)
________________________________________ 
Pennsylvania 23-1707341
(State or Other Jurisdiction of
Incorporation or Organization)
 (I.R.S. Employer Identification No.)
1 Freedom Valley Drive, Oaks, Pennsylvania 19456-1100
(Address of Principal Executive Offices) (Zip Code)
(610) 676-1000
(Registrant’s Telephone Number, Including Area Code)
N/A
(Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report) 
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading SymbolName of each exchange on which registered
Common Stock, par value $0.01 per shareSEICThe NASDAQ Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.      Yes  x    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  x    No  ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filerxAccelerated filer
Non-accelerated filerSmaller 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 Act).  Yes  ☐    No  x
The number of shares outstanding of the registrant’s common stock, as of the close of business on October 20, 2022:July 13, 2023:
Common Stock, $0.01 par value134,828,481132,358,055 





SEI INVESTMENTS COMPANY

TABLE OF CONTENTS
PART I - FINANCIAL INFORMATION
Page
Item 1.Financial Statements.
Consolidated Balance Sheets (Unaudited) -- SeptemberJune 30, 20222023 and December 31, 20212022
Consolidated Statements of Operations (Unaudited) -- For the Three and NineSix Months Ended SeptemberJune 30, 20222023 and 20212022
Consolidated Statements of Comprehensive Income (Unaudited) -- For the Three and NineSIx Months Ended SeptemberJune 30, 20222023 and 20212022
Consolidated Statements of Changes in Equity (Unaudited) -- For the Three and NineSix Months Ended SeptemberJune 30, 20222023 and 20212022
Consolidated Condensed Statements of Cash Flows (Unaudited) -- For the NineSix Months Ended SeptemberJune 30, 20222023 and 20212022
Notes to Consolidated Financial Statements
Item 2.Management's Discussion and Analysis of Financial Condition and Results of Operations.
Item 3.Quantitative and Qualitative Disclosures About Market Risk.
Item 4.Controls and Procedures.
PART II - OTHER INFORMATION
Item 1.Legal Proceedings.
Item 1A.Risk Factors.
Item 2.Unregistered Sales of Equity Securities and Use of Proceeds.
Item 6.Exhibits.
Signatures






1


PART I.        FINANCIAL INFORMATION

Item 1.    Consolidated Financial Statements.

SEI Investments Company
Consolidated Balance Sheets
(unaudited)
(In thousands, except par value)
September 30, 2022December 31, 2021June 30, 2023December 31, 2022
AssetsAssetsAssets
Current Assets:Current Assets:Current Assets:
Cash and cash equivalentsCash and cash equivalents$791,437 $831,407 Cash and cash equivalents$777,051 $853,008 
Restricted cashRestricted cash351 351 Restricted cash300 351 
Receivables from investment productsReceivables from investment products91,223 59,036 Receivables from investment products56,304 62,014 
Receivables, net of allowance for doubtful accounts of $2,336 and $1,602482,692 441,609 
Receivables, net of allowance for doubtful accounts of $936 and $901Receivables, net of allowance for doubtful accounts of $936 and $901521,600 457,084 
Securities ownedSecurities owned31,586 28,267 Securities owned31,040 32,148 
Other current assetsOther current assets54,931 43,559 Other current assets55,610 48,703 
Total Current AssetsTotal Current Assets1,452,220 1,404,229 Total Current Assets1,441,905 1,453,308 
Property and Equipment, net of accumulated depreciation of $431,473 and $409,248182,522 178,869 
Property and Equipment, net of accumulated depreciation of $458,119 and $440,861Property and Equipment, net of accumulated depreciation of $458,119 and $440,861180,503 181,029 
Operating Lease Right-of-Use AssetsOperating Lease Right-of-Use Assets24,187 33,614 Operating Lease Right-of-Use Assets22,293 24,992 
Capitalized Software, net of accumulated amortization of $579,352 and $545,307234,228 243,446 
Capitalized Software, net of accumulated amortization of $599,557 and $586,744Capitalized Software, net of accumulated amortization of $599,557 and $586,744242,525 237,302 
Available for Sale and Equity SecuritiesAvailable for Sale and Equity Securities109,375 129,541 Available for Sale and Equity Securities116,791 128,201 
Investments in Affiliated Funds, at fair valueInvestments in Affiliated Funds, at fair value5,620 6,916 Investments in Affiliated Funds, at fair value6,772 6,366 
Investment in Unconsolidated AffiliateInvestment in Unconsolidated Affiliate39,012 107,918 Investment in Unconsolidated Affiliate54,318 104,673 
GoodwillGoodwill117,509 117,232 Goodwill115,602 115,599 
Intangible Assets, net of accumulated amortization of $27,133 and $17,71658,201 68,782 
Intangible Assets, net of accumulated amortization of $36,450 and $30,261Intangible Assets, net of accumulated amortization of $36,450 and $30,26149,621 55,532 
Deferred Contract CostsDeferred Contract Costs37,790 36,236 Deferred Contract Costs38,561 37,928 
Deferred Income TaxesDeferred Income Taxes2,253 2,983 Deferred Income Taxes17,464 4,936 
Other Assets, netOther Assets, net32,514 24,936 Other Assets, net38,609 33,687 
Total AssetsTotal Assets$2,295,431 $2,354,702 Total Assets$2,324,964 $2,383,553 
The accompanying notes are an integral part of these consolidated financial statements.





2


SEI Investments Company
Consolidated Balance Sheets
(unaudited)
(In thousands, except par value)
September 30, 2022December 31, 2021June 30, 2023December 31, 2022
Liabilities and EquityLiabilities and EquityLiabilities and Equity
Current Liabilities:Current Liabilities:Current Liabilities:
Accounts payableAccounts payable$8,209 $10,312 Accounts payable$7,220 $13,283 
Accrued liabilitiesAccrued liabilities294,987 324,382 Accrued liabilities237,164 359,363 
Current portion of long-term operating lease liabilitiesCurrent portion of long-term operating lease liabilities11,202 11,328 Current portion of long-term operating lease liabilities11,076 10,344 
Deferred revenueDeferred revenue13,025 9,721 Deferred revenue14,913 14,893 
Total Current LiabilitiesTotal Current Liabilities327,423 355,743 Total Current Liabilities270,373 397,883 
Borrowings Under Revolving Credit Facility— 40,000 
Long-term Income Taxes PayableLong-term Income Taxes Payable803 803 Long-term Income Taxes Payable803 803 
Deferred Income Taxes3,545 48,876 
Long-term Operating Lease LiabilitiesLong-term Operating Lease Liabilities18,361 27,639 Long-term Operating Lease Liabilities16,032 18,786 
Other Long-term LiabilitiesOther Long-term Liabilities14,986 20,878 Other Long-term Liabilities14,203 12,257 
Total LiabilitiesTotal Liabilities365,118 493,939 Total Liabilities301,411 429,729 
Commitments and ContingenciesCommitments and ContingenciesCommitments and Contingencies
Shareholders' Equity:Shareholders' Equity:Shareholders' Equity:
Common stock, $0.01 par value, 750,000 shares authorized; 134,816 and 138,449 shares issued and outstanding1,348 1,384 
Common stock, $0.01 par value, 750,000 shares authorized; 132,230 and 134,162 shares issued and outstandingCommon stock, $0.01 par value, 750,000 shares authorized; 132,230 and 134,162 shares issued and outstanding1,322 1,342 
Capital in excess of par valueCapital in excess of par value1,285,224 1,246,608 Capital in excess of par value1,337,538 1,307,162 
Retained earningsRetained earnings711,330 632,614 Retained earnings724,672 694,287 
Accumulated other comprehensive loss, netAccumulated other comprehensive loss, net(67,589)(19,843)Accumulated other comprehensive loss, net(39,979)(48,967)
Total Shareholders' EquityTotal Shareholders' Equity1,930,313 1,860,763 Total Shareholders' Equity2,023,553 1,953,824 
Total Liabilities and Shareholders' EquityTotal Liabilities and Shareholders' Equity$2,295,431 $2,354,702 Total Liabilities and Shareholders' Equity$2,324,964 $2,383,553 
The accompanying notes are an integral part of these consolidated financial statements.




3


SEI Investments Company
Consolidated Statements of Operations
(unaudited)
(In thousands, except per share data)
 
Three Months Ended September 30,Nine Months Ended September 30, Three Months Ended June 30,Six Months Ended June 30,
2022202120222021 2023202220232022
Revenues:Revenues:Revenues:
Asset management, administration and distribution feesAsset management, administration and distribution fees$372,133 $393,296 $1,148,824 $1,143,451 Asset management, administration and distribution fees$378,821 $382,594 $750,650 $776,691 
Information processing and software servicing feesInformation processing and software servicing fees99,201 92,026 385,623 273,208 Information processing and software servicing fees110,236 99,076 207,526 286,422 
Total revenuesTotal revenues471,334 485,322 1,534,447 1,416,659 Total revenues489,057 481,670 958,176 1,063,113 
Expenses:Expenses:Expenses:
Subadvisory, distribution and other asset management costsSubadvisory, distribution and other asset management costs47,334 55,619 150,485 161,610 Subadvisory, distribution and other asset management costs47,247 50,023 94,626 103,151 
Software royalties and other information processing costsSoftware royalties and other information processing costs6,909 7,348 21,863 20,561 Software royalties and other information processing costs8,396 7,407 15,689 14,954 
Compensation, benefits and other personnelCompensation, benefits and other personnel227,127 150,188 545,532 429,188 Compensation, benefits and other personnel175,706 157,921 349,121 318,405 
Stock-based compensationStock-based compensation10,766 11,318 31,339 31,173 Stock-based compensation7,405 10,007 15,479 20,573 
Consulting, outsourcing and professional feesConsulting, outsourcing and professional fees58,558 55,868 184,320 165,657 Consulting, outsourcing and professional fees61,312 63,271 122,416 125,762 
Data processing and computer relatedData processing and computer related30,950 26,650 93,020 79,746 Data processing and computer related34,945 32,254 68,285 62,070 
Facilities, supplies and other costsFacilities, supplies and other costs19,704 14,124 57,464 49,851 Facilities, supplies and other costs23,034 20,133 41,826 37,760 
AmortizationAmortization10,382 14,674 43,777 43,749 Amortization9,630 16,508 19,054 33,395 
DepreciationDepreciation8,558 8,408 24,942 25,141 Depreciation8,781 8,286 17,312 16,384 
Total expensesTotal expenses420,288 344,197 1,152,742 1,006,676 Total expenses376,456 365,810 743,808 732,454 
Income from operationsIncome from operations51,046 141,125 381,705 409,983 Income from operations112,601 115,860 214,368 330,659 
Net (loss) gain from investments(1,406)(575)(4,515)134 
Net gain (loss) from investmentsNet gain (loss) from investments515 (2,620)1,259 (3,109)
Interest and dividend incomeInterest and dividend income3,962 892 6,663 2,715 Interest and dividend income9,550 1,853 18,328 2,701 
Interest expenseInterest expense(143)(101)(604)(354)Interest expense(139)(211)(280)(461)
Equity in earnings of unconsolidated affiliateEquity in earnings of unconsolidated affiliate26,654 35,005 88,926 103,420 Equity in earnings of unconsolidated affiliate32,711 29,813 61,590 62,272 
Income before income taxesIncome before income taxes80,113 176,346 472,175 515,898 Income before income taxes155,238 144,695 295,265 392,062 
Income taxesIncome taxes18,454 38,301 108,932 114,605 Income taxes36,387 33,419 69,399 90,478 
Net incomeNet income$61,659 $138,045 $363,243 $401,293 Net income$118,851 $111,276 $225,866 $301,584 
Basic earnings per common shareBasic earnings per common share$0.46 $0.98 $2.66 $2.83 Basic earnings per common share$0.89 $0.82 $1.69 $2.20 
Shares used to compute basic earnings per shareShares used to compute basic earnings per share135,203 140,507 136,524 141,928 Shares used to compute basic earnings per share132,854 136,435 133,437 137,185 
Diluted earnings per common shareDiluted earnings per common share$0.45 $0.97 $2.63 $2.79 Diluted earnings per common share$0.89 $0.81 $1.68 $2.17 
Shares used to compute diluted earnings per shareShares used to compute diluted earnings per share136,345 142,426 137,958 143,981 Shares used to compute diluted earnings per share133,936 137,817 134,623 138,764 
Dividends declared per common shareDividends declared per common share$— $— $0.40 $0.37 Dividends declared per common share$0.43 $0.40 $0.43 $0.40 
The accompanying notes are an integral part of these consolidated financial statements.




4


SEI Investments Company
Consolidated Statements of Comprehensive Income
(unaudited)
(In thousands)
 
 Three Months Ended September 30,Nine Months Ended September 30,
 2022202120222021
Net income$61,659 $138,045 $363,243 $401,293 
Other comprehensive loss, net of tax:
Foreign currency translation adjustments(17,909)(5,546)(37,090)(2,867)
Unrealized loss on investments:
Unrealized losses during the period, net of income taxes of $1,194, $208, $3,303 and $453(4,000)(713)(11,057)(1,548)
Reclassification adjustment for losses realized in net income, net of income taxes of $(24), $(67), $(120) and $(190)83 238 401 670 
Total other comprehensive loss, net of tax(21,826)(6,021)(47,746)(3,745)
Comprehensive income$39,833 $132,024 $315,497 $397,548 
 Three Months Ended June 30,Six Months Ended June 30,
 2023202220232022
Net income$118,851 $111,276 $225,866 $301,584 
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments5,684 (14,623)8,751 (19,181)
Unrealized gain (loss) on investments:
Unrealized (losses) gains during the period, net of income taxes of $342, $923, $(43) and $2,109(1,143)(3,088)144 (7,057)
Reclassification adjustment for losses realized in net income, net of income taxes of $(18), $(39), $(29) and $(96)58 129 93 318 
Total other comprehensive income (loss), net of tax4,599 (17,582)8,988 (25,920)
Comprehensive income$123,450 $93,694 $234,854 $275,664 
The accompanying notes are an integral part of these consolidated financial statements.




5


SEI Investments Company
Consolidated Statements of Changes in Equity
(unaudited)
(In thousands)
Shares of Common StockCommon StockCapital In Excess of Par ValueRetained EarningsAccumulated Other Comprehensive LossTotal EquityShares of Common StockCommon StockCapital In Excess of Par ValueRetained EarningsAccumulated Other Comprehensive LossTotal Equity
For the Three Months Ended September 30, 2022For the Three Months Ended June 30, 2023
Balance, July 1, 2022135,480 $1,355 $1,272,971 $693,525 $(45,763)$1,922,088 
Balance, April 1, 2023Balance, April 1, 2023133,268 $1,333 $1,327,591 $729,988 $(44,578)$2,014,334 
Net incomeNet income— — — 61,659 — 61,659 Net income— — — 118,851 — 118,851 
Other comprehensive loss— — — — (21,826)(21,826)
Other comprehensive incomeOther comprehensive income— — — — 4,599 4,599 
Purchase and retirement of common stockPurchase and retirement of common stock(890)(9)(5,571)(43,854)— (49,434)Purchase and retirement of common stock(1,290)(13)(8,534)(66,990)— (75,537)
Issuance of common stock under employee stock purchase planIssuance of common stock under employee stock purchase plan24 — 1,123 — — 1,123 Issuance of common stock under employee stock purchase plan21 — 1,041 — — 1,041 
Issuance of common stock upon exercise of stock options202 5,935 — — 5,937 
Issuance of common stock under share-based award plansIssuance of common stock under share-based award plans231 10,035 — — 10,037 
Stock-based compensationStock-based compensation— — 10,766 — — 10,766 Stock-based compensation— — 7,405 — — 7,405 
Balance, September 30, 2022134,816 $1,348 $1,285,224 $711,330 $(67,589)$1,930,313 
Dividends declared ($0.43 per share)Dividends declared ($0.43 per share)— — — (57,177)— (57,177)
Balance, June 30, 2023Balance, June 30, 2023132,230 $1,322 $1,337,538 $724,672 $(39,979)$2,023,553 
Shares of Common StockCommon StockCapital In Excess of Par ValueRetained EarningsAccumulated Other Comprehensive LossTotal Equity
For the Three Months Ended September 30, 2021
Balance, July 1, 2021141,027 $1,410 $1,219,487 $599,231 $(14,522)$1,805,606 
Net income— — — 138,045 — 138,045 
Other comprehensive loss— — — — (6,021)(6,021)
Purchase and retirement of common stock(1,980)(21)(11,751)(108,123)— (119,895)
Issuance of common stock under employee stock purchase plan22 1,119 — — 1,120 
Issuance of common stock upon exercise of stock options236 7,912 — — 7,915 
Stock-based compensation— — 11,318 — — 11,318 
Balance, September 30, 2021139,305 $1,393 $1,228,085 $629,153 $(20,543)$1,838,088 

Shares of Common StockCommon StockCapital In Excess of Par ValueRetained EarningsAccumulated Other Comprehensive LossTotal Equity
For the Three Months Ended June 30, 2022
Balance, April 1, 2022137,219 $1,372 $1,266,320 $733,572 $(28,181)$1,973,083 
Net income— — — 111,276 — 111,276 
Other comprehensive loss— — — — (17,582)(17,582)
Purchase and retirement of common stock(1,970)(20)(12,328)(96,945)— (109,293)
Issuance of common stock under employee stock purchase plan22 1,089 — — 1,090 
Issuance of common stock under share-based award plans209 7,883 — — 7,885 
Stock-based compensation— — 10,007 — — 10,007 
Dividends declared ($0.40 per share)— — — (54,378)— (54,378)
Balance, June 30, 2022135,480 $1,355 $1,272,971 $693,525 $(45,763)$1,922,088 
The accompanying notes are an integral part of these consolidated financial statements.




6


SEI Investments Company
Consolidated Statements of Changes in Equity
(unaudited)
(In thousands)
Shares of Common StockCommon StockCapital In Excess of Par ValueRetained EarningsAccumulated Other Comprehensive LossTotal Equity
For the Six Months Ended June 30, 2023
Balance, January 1, 2023134,162 $1,342 $1,307,162 $694,287 $(48,967)$1,953,824 
Net income— — — 225,866 — 225,866 
Other comprehensive loss— — — — 8,988 8,988 
Purchase and retirement of common stock(2,651)(27)(17,538)(138,304)— (155,869)
Issuance of common stock under employee stock purchase plan45 — 2,244 — — 2,244 
Issuance of common stock under share-based award plans674 30,191 — — 30,198 
Stock-based compensation— — 15,479 — — 15,479 
Dividends declared ($0.43 per share)— — — (57,177)— (57,177)
Balance, June 30, 2023132,230 $1,322 $1,337,538 $724,672 $(39,979)$2,023,553 
Shares of Common StockCommon StockCapital In Excess of Par ValueRetained EarningsAccumulated Other Comprehensive LossTotal Equity
For the Nine Months Ended September 30, 2022
Balance, January 1, 2022138,449 $1,384 $1,246,608 $632,614 $(19,843)$1,860,763 
Net income— — — 363,243 — 363,243 
Other comprehensive loss— — — — (47,746)(47,746)
Purchase and retirement of common stock(4,573)(46)(28,622)(230,149)— (258,817)
Issuance of common stock under employee stock purchase plan69 3,380 — — 3,381 
Issuance of common stock upon exercise of stock options871 32,519 — — 32,528 
Stock-based compensation— — 31,339 — — 31,339 
Dividends declared ($0.40 per share)— — — (54,378)— (54,378)
Balance, September 30, 2022134,816 $1,348 $1,285,224 $711,330 $(67,589)$1,930,313 

Shares of Common StockCommon StockCapital In Excess of Par ValueRetained EarningsAccumulated Other Comprehensive LossTotal EquityShares of Common StockCommon StockCapital In Excess of Par ValueRetained EarningsAccumulated Other Comprehensive LossTotal Equity
For the Nine Months Ended September 30, 2021For the Six Months Ended June 30, 2022
Balance, January 1, 2021143,396 $1,434 $1,190,001 $565,270 $(16,798)$1,739,907 
Balance, January 1, 2022Balance, January 1, 2022138,449 $1,384 $1,246,608 $632,614 $(19,843)$1,860,763 
Net incomeNet income— — — 401,293 — 401,293 Net income— — — 301,584 — 301,584 
Other comprehensive lossOther comprehensive loss— — — — (3,745)(3,745)Other comprehensive loss— — — — (25,920)(25,920)
Purchase and retirement of common stockPurchase and retirement of common stock(5,218)(53)(30,979)(285,021)— (316,053)Purchase and retirement of common stock(3,683)(37)(23,051)(186,295)— (209,383)
Issuance of common stock under employee stock purchase planIssuance of common stock under employee stock purchase plan64 3,224 — — 3,225 Issuance of common stock under employee stock purchase plan45 2,257 — — 2,258 
Issuance of common stock upon exercise of stock options1,063 11 34,666 — — 34,677 
Issuance of common stock under share-based award plansIssuance of common stock under share-based award plans669 26,584 — — 26,591 
Stock-based compensationStock-based compensation— — 31,173 — — 31,173 Stock-based compensation— — 20,573 — — 20,573 
Dividends declared ($0.37 per share)— — — (52,389)— (52,389)
Balance, September 30, 2021139,305 $1,393 $1,228,085 $629,153 $(20,543)$1,838,088 
Dividends declared ($0.40 per share)Dividends declared ($0.40 per share)— — — (54,378)— (54,378)
Balance, June 30, 2022Balance, June 30, 2022135,480 $1,355 $1,272,971 $693,525 $(45,763)$1,922,088 
The accompanying notes are an integral part of these consolidated financial statements.





7


SEI Investments Company
Consolidated Condensed Statements of Cash Flows
(unaudited)
(In thousands)
Nine Months Ended September 30, Six Months Ended
June 30,
20222021 20232022
Cash flows from operating activities:Cash flows from operating activities:Cash flows from operating activities:
Net incomeNet income$363,243 $401,293 Net income$225,866 $301,584 
Adjustments to reconcile net income to net cash provided by operating activities (See Note 1)Adjustments to reconcile net income to net cash provided by operating activities (See Note 1)65,276 82,588 Adjustments to reconcile net income to net cash provided by operating activities (See Note 1)(43,412)29,031 
Net cash provided by operating activitiesNet cash provided by operating activities428,519 483,881 Net cash provided by operating activities182,454 330,615 
Cash flows from investing activities:Cash flows from investing activities:Cash flows from investing activities:
Additions to property and equipmentAdditions to property and equipment(32,319)(22,520)Additions to property and equipment(16,470)(19,821)
Additions to capitalized softwareAdditions to capitalized software(24,827)(19,486)Additions to capitalized software(18,036)(13,809)
Purchases of marketable securitiesPurchases of marketable securities(124,454)(168,333)Purchases of marketable securities(48,046)(96,642)
Prepayments and maturities of marketable securitiesPrepayments and maturities of marketable securities124,040 133,895 Prepayments and maturities of marketable securities60,829 90,553 
Sales of marketable securitiesSales of marketable securities179 327 Sales of marketable securities893 106 
Other investing activitiesOther investing activities(2,961)(11,425)Other investing activities(4,979)(2,903)
Net cash used in investing activitiesNet cash used in investing activities(60,342)(87,542)Net cash used in investing activities(25,809)(42,516)
Cash flows from financing activities:Cash flows from financing activities:Cash flows from financing activities:
Repayments under revolving credit facilityRepayments under revolving credit facility(40,000)— Repayments under revolving credit facility— (40,000)
Payment of contingent considerationPayment of contingent consideration(868)(3,965)Payment of contingent consideration(904)(868)
Purchase and retirement of common stockPurchase and retirement of common stock(266,549)(315,811)Purchase and retirement of common stock(156,174)(210,324)
Proceeds from issuance of common stockProceeds from issuance of common stock35,909 37,902 Proceeds from issuance of common stock32,442 28,849 
Payment of dividendsPayment of dividends(109,830)(105,516)Payment of dividends(114,829)(109,830)
Net cash used in financing activitiesNet cash used in financing activities(381,338)(387,390)Net cash used in financing activities(239,465)(332,173)
Effect of exchange rate changes on cash, cash equivalents and restricted cashEffect of exchange rate changes on cash, cash equivalents and restricted cash(26,809)(2,442)Effect of exchange rate changes on cash, cash equivalents and restricted cash6,812 (15,660)
Net (decrease) increase in cash, cash equivalents and restricted cash(39,970)6,507 
Net decrease in cash, cash equivalents and restricted cashNet decrease in cash, cash equivalents and restricted cash(76,008)(59,734)
Cash, cash equivalents and restricted cash, beginning of periodCash, cash equivalents and restricted cash, beginning of period831,758 787,727 Cash, cash equivalents and restricted cash, beginning of period853,359 831,758 
Cash, cash equivalents and restricted cash, end of periodCash, cash equivalents and restricted cash, end of period$791,788 $794,234 Cash, cash equivalents and restricted cash, end of period$777,351 $772,024 
The accompanying notes are an integral part of these consolidated financial statements.




8


Notes to Consolidated Financial Statements
(all figures are in thousands except share and per share data)
 
Note 1.    Summary of Significant Accounting Policies
Nature of Operations
SEI Investments Company (the Company), a Pennsylvania corporation, provides comprehensive platforms, services and infrastructure–encompassing technology, operational, and investment management services–to help wealth managers, financial advisors, investment managers, family offices, institutional and private investors create and manage wealth.
Investment processing platforms provide technologies and business process outsourcing services for wealth managers and investment advisors.managers. These solutions include investment advisory, client relationship, and other technology-enabled capabilities for the front office; administrative and investment services for the middle office; and accounting and processing services for the back office. Revenues from investment processing platforms are recognized in Information processing and software servicing fees on the accompanying Consolidated Statements of Operations.
Investment operations platforms provide business process outsourcing services for investment managers and asset owners. These platforms support a broad range of traditional and alternative investments and provide technology-enabled information analytics and investor capabilities for the front office; administrative and investment services for the middle office; and fund administration and accounting services for the back office. Revenues from investment operations platforms are recognized in Asset management, administration and distribution fees on the accompanying Consolidated Statements of Operations.
Investment management platforms provide comprehensive solutions for managing personal and institutional wealth. These platforms include goals-based investment strategies; SEI-sponsored investment products, including mutual funds, collective investment products, alternative investment portfolios and separately managed accounts (SMA); and other market-specific advice, technology and operational components. These platforms are offered to wealth managers as part of a complete goals-based investment program for their end-investors. For institutional investors, the Company provides Outsourced Chief Investment Officer (OCIO) solutions and Enhanced Chief Investment Officer (ECIO) solutions that include investment management programs, as well as advisory and administrative services. Revenues from investment management platforms are recognized in Asset management, administration and distribution fees on the accompanying Consolidated Statements of Operations.
Basis of Presentation
The accompanying Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America. Certain financial information and accompanying note disclosure normally included in the Company’s Annual Report on Form 10-K have been condensed or omitted. The interim financial information is unaudited but reflects all adjustments (consisting of only normal recurring adjustments) which are, in the opinion of management, necessary for a fair statement of financial position of the Company as of SeptemberJune 30, 2022,2023, the results of operations for the three and ninesix months ended SeptemberJune 30, 20222023 and 2021,2022, and cash flows for the nine-monthssix months ended SeptemberJune 30, 20222023 and 2021.2022. These interim Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and the Notes to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021.2022.
There have been no significant changes in significant accounting policies during the ninesix months ended SeptemberJune 30, 20222023 as compared to the significant accounting policies described in the Company's Annual Report on Form 10-K for the year ended December 31, 2021.2022.
Variable Interest Entities
The Company or its affiliates have created numerous investment products for its clients in various types of legal entity structures. The Company serves as the Manager, Administrator and Distributor for these investment products and may also serve as the Trustee for some of the investment products. The Company receives asset management, distribution, administration and custodial fees for these services. Clients are the equity investors and participate in proportion to their ownership percentage in the net income or loss and net capital gains or losses of the products, and, on liquidation, will participate in proportion to their ownership percentage in the remaining net assets of the products after satisfaction of outstanding liabilities. The Company has concluded that it is not the primary beneficiary of the entities and, therefore, is not required to consolidate any of the pooled investment vehicles for which it receives asset management, distribution, administration and custodial fees under the VIE model.
The Company is a party to expense limitation agreements with certain SEI-sponsored money market funds subject to Rule 2a-7 of the Investment Company Act of 1940 which establish a maximum level of ordinary operating expenses incurred by




9


the fund in any fiscal year including, but not limited to, fees of the administrator or its affiliates. Under the terms of these




9


agreements, the Company waived $7,896$5,320 and $11,629$9,039 in fees during the three months ended SeptemberJune 30, 20222023 and 2021,2022, respectively. During the ninesix months ended SeptemberJune 30, 20222023 and 2021,2022, the Company waived $28,120$10,881 and $33,118,$20,224, respectively, in fees.
Revenue Recognition
Revenue is recognized when the transfer of control of promised goods or services under the terms of a contract with customers are satisfied in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those promised goods or services. Certain portions of the Company’s revenues involve a third party in providing goods or services to its customers. In such circumstances, the Company must determine whether the nature of its promise to the customer is to provide the underlying goods or services (the Company is the principal in the transaction and reports the transaction gross) or to arrange for a third party to provide the underlying goods or services (the entity is the agent in the transaction and reports the transaction net). See Note 13 for related disclosures regarding revenue recognition.
Cash and Cash Equivalents
Cash and cash equivalents includes $305,877$304,611 and $290,256$305,434 at SeptemberJune 30, 20222023 and December 31, 2021,2022, respectively, primarily invested in SEI-sponsored open-ended money market mutual funds.
Restricted Cash
Restricted cash includes $250 at SeptemberJune 30, 20222023 and December 31, 20212022 segregated for regulatory purposes related to trade-execution services conducted by SEI Investments (Europe) Limited. Restricted cash also includes $50 and $101 at SeptemberJune 30, 20222023 and December 31, 20212022, respectively, segregated in special reserve accounts for the benefit of customers of the Company’s broker-dealer subsidiary, SEI Investments Distribution Co. (SIDCO), in accordance with certain rules established by the Securities and Exchange Commission (SEC) for broker-dealers.
Capitalized Software
The Company capitalized $24,827$18,036 and $19,486$13,809 of software development costs during the ninesix months ended SeptemberJune 30, 20222023 and 2021,2022, respectively. The Company's software development costs primarily relate to significant enhancements to the SEI Wealth PlatformSM (SWP). As of SeptemberJune 30, 2022,2023, the net book value of SWP was $225,725$222,853. The net book value includes $8,660$3,127 of capitalized software development costs in-progress associated with future releases of SWP. Capitalized software development costs in-progress associated with future releases of SWP were $29,253$14,217 as of December 31, 2021.2022. SWP has a weighted average remaining life of 10.09.4 years. Amortization expense for SWP was $29,696$12,516 and $35,834$23,859 during the ninesix months ended SeptemberJune 30, 2023 and 2022, and 2021, respectively.
The Company also capitalized $5,284$8,642 of software development costs during the ninesix months ended SeptemberJune 30, 20222023 related to a new platform for the Investment Managers segment. Capitalized software development costs in-progress associated with this platform were $18,196 and $9,558 as of June 30, 2023 and December 31, 2022, respectively. The platform is not yet ready for use.
Earnings per Share
The calculations of basic and diluted earnings per share for the three and ninesix months ended SeptemberJune 30, 20222023 and 20212022 are:
Three Months Ended September 30,Nine Months Ended September 30, Three Months Ended June 30,Six Months Ended June 30,
2022202120222021 2023202220232022
Net incomeNet income$61,659 $138,045 $363,243 $401,293 Net income$118,851 $111,276 $225,866 $301,584 
Shares used to compute basic earnings per common shareShares used to compute basic earnings per common share135,203,000 140,507,000 136,524,000 141,928,000 Shares used to compute basic earnings per common share132,854,000 136,435,000 133,437,000 137,185,000 
Dilutive effect of stock optionsDilutive effect of stock options1,142,000 1,919,000 1,434,000 2,053,000 Dilutive effect of stock options1,082,000 1,382,000 1,186,000 1,579,000 
Shares used to compute diluted earnings per common shareShares used to compute diluted earnings per common share136,345,000 142,426,000 137,958,000 143,981,000 Shares used to compute diluted earnings per common share133,936,000 137,817,000 134,623,000 138,764,000 
Basic earnings per common shareBasic earnings per common share$0.46 $0.98 $2.66 $2.83 Basic earnings per common share$0.89 $0.82 $1.69 $2.20 
Diluted earnings per common shareDiluted earnings per common share$0.45 $0.97 $2.63 $2.79 Diluted earnings per common share$0.89 $0.81 $1.68 $2.17 
During the three months ended SeptemberJune 30, 20222023 and 2021,2022, employee stock options to purchase 11,862,00011,006,000 and 11,347,00012,064,000 shares of common stock with an average exercise price of $60.26$61.29 and $57.80,$60.27, respectively, were outstanding but not included in the computation of diluted earnings per common share. During the ninesix months ended SeptemberJune 30, 20222023 and 2021,2022, employee stock options to purchase 12,048,00011,140,000 and 11,531,00012,141,000 shares of common stock with an average exercise price of $60.27$61.29 and $57.78,$60.28, respectively, were outstanding but not included in the computation of diluted earnings per common share. Theseshare.These options for the three and ninesix month periods were not included in the computation of diluted earnings per




10


common share because either the performance conditions have not been satisfied or would not have been satisfied if the reporting date was the end of the contingency period or the options' exercise price was greater than




10


the average market price of the Company’s common stock and the effect on diluted earnings per common share would have been anti-dilutive.
Recently Adopted Accounting Pronouncements
In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805) Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (ASU 2021-08). This update amends Topic 805 to add contract assets and contract liabilities to the list of exceptions to the recognition and measurement principles that apply to business combinations and to require that an entity (acquirer) recognize and measure contract assets and contract liabilities in accordance with ASC 606. The Company adopted ASU 2021-08 on January 1, 2023. There was no material impact to the Company's consolidated financial statements from the implementation of ASU 2021-08.
Statements of Cash Flows
For purposes of the Consolidated Statements of Cash Flows, the Company considers investment instruments purchased with an original maturity of three months or less to be cash equivalents.
The following table provides the details of the adjustments to reconcile net income to net cash provided by operating activities for the ninesix months ended SeptemberJune 30:
2022202120232022
Net incomeNet income$363,243 $401,293 Net income$225,866 $301,584 
Adjustments to reconcile net income to net cash provided by operating activities:Adjustments to reconcile net income to net cash provided by operating activities:Adjustments to reconcile net income to net cash provided by operating activities:
DepreciationDepreciation24,942 25,141 Depreciation17,312 16,384 
AmortizationAmortization43,777 43,749 Amortization19,054 33,395 
Equity in earnings of unconsolidated affiliateEquity in earnings of unconsolidated affiliate(88,926)(103,420)Equity in earnings of unconsolidated affiliate(61,590)(62,272)
Distributions received from unconsolidated affiliateDistributions received from unconsolidated affiliate103,504 110,559 Distributions received from unconsolidated affiliate61,452 69,824 
Stock-based compensationStock-based compensation31,339 31,173 Stock-based compensation15,479 20,573 
Provision for losses on receivablesProvision for losses on receivables734 1,569 Provision for losses on receivables35 350 
Deferred income tax expenseDeferred income tax expense(41,419)(6,639)Deferred income tax expense(12,600)(23,506)
Net loss (gain) from investments4,515 (134)
Net (gain) loss from investmentsNet (gain) loss from investments(1,259)3,109 
Change in other long-term liabilitiesChange in other long-term liabilities3,014 2,103 Change in other long-term liabilities1,946 1,998 
Change in other assetsChange in other assets(4,820)314 Change in other assets(71)(3,111)
Contract costs capitalized, net of amortizationContract costs capitalized, net of amortization(1,554)(482)Contract costs capitalized, net of amortization(633)883 
OtherOther(6,934)921 Other2,443 (1,521)
Change in current assets and liabilitiesChange in current assets and liabilitiesChange in current assets and liabilities
(Increase) decrease in(Increase) decrease in(Increase) decrease in
Receivables from investment productsReceivables from investment products(32,187)(4,537)Receivables from investment products5,710 4,125 
ReceivablesReceivables(41,697)(58,537)Receivables(64,551)(25,523)
Other current assetsOther current assets(11,422)(3,919)Other current assets(6,907)(7,014)
Advances due from unconsolidated affiliateAdvances due from unconsolidated affiliate54,328 51,422 Advances due from unconsolidated affiliate50,493 53,500 
(Decrease) increase in(Decrease) increase in(Decrease) increase in
Accounts payableAccounts payable(2,103)3,006 Accounts payable(6,063)(7)
Accrued liabilitiesAccrued liabilities27,092 (9,851)Accrued liabilities(63,682)(55,734)
Deferred revenueDeferred revenue3,093 150 Deferred revenue20 3,578 
Total adjustmentsTotal adjustments65,276 82,588 Total adjustments(43,412)29,031 
Net cash provided by operating activitiesNet cash provided by operating activities$428,519 $483,881 Net cash provided by operating activities$182,454 $330,615 





11


Note 2.    Investment in Unconsolidated Affiliate
LSV Asset Management
The Company has an investment in LSV Asset Management (LSV), a registered investment advisor that provides investment advisory services primarily to institutions, including pension plans and investment companies. LSV is currently an investment sub-advisor for a limited number of SEI-sponsored investment products. The Company's partnership interest in LSV as of SeptemberJune 30, 20222023 was 38.6%. The Company accounts for its interest in LSV using the equity method because of its less than 50% ownership. The Company’s interest in the net assets of LSV is reflected in Investment in unconsolidated affiliate on the accompanying Consolidated Balance Sheets and its interest in the earnings of LSV is reflected in Equity in earnings of unconsolidated affiliate on the accompanying Consolidated Statements of Operations.
At SeptemberJune 30, 2022,2023, the Company’s total investment in LSV was $39,012.$54,318. The Company receives partnership distributions from LSV on a quarterly basis. The Company received partnership distributions from LSV of $103,504$61,452 and $110,559$69,824 in the ninesix months ended SeptemberJune 30, 20222023 and 2021,2022, respectively. As such, the Company considers these




11


distribution payments as returns on investment rather than returns of the Company's original investment in LSV and has therefore classified the associated cash inflows as an operating activity on the Consolidated Statements of Cash Flows.
The Company’s proportionate share in the earnings of LSV was $26,654$32,711 and $35,005$29,813 during the three months ended SeptemberJune 30, 20222023 and 2021,2022, respectively. During the ninesix months ended SeptemberJune 30, 20222023 and 2021,2022, the Company's proportionate share in the earnings of LSV was $88,926$61,590 and $103,420,$62,272, respectively.
These tables contain condensed financial information of LSV:
Condensed Statement of OperationsCondensed Statement of OperationsThree Months Ended September 30,Nine Months Ended September 30,Condensed Statement of OperationsThree Months Ended June 30,Six Months Ended June 30,
2022202120222021 2023202220232022
RevenuesRevenues$91,588 $115,728 $299,852 $342,957 Revenues$108,836 $99,814 $207,028 $208,264 
Net incomeNet income69,013 90,365 229,997 266,805 Net income84,779 77,193 159,553 160,984 
Condensed Balance SheetsSeptember 30, 2022December 31, 2021
Current assets$110,421 $171,058 
Non-current assets5,113 4,792 
Total assets$115,534 $175,850 
Current liabilities$64,263 $82,858 
Non-current liabilities3,260 3,863 
Partners’ capital48,011 89,129 
Total liabilities and partners’ capital$115,534 $175,850 
On April 1, 2022, LSV provided an interest in the partnership to select key employees which reduced the ownership percentage of each existing partner on a pro-rata basis. As a result, the Company's total partnership interest in LSV was reduced slightly to approximately 38.6% from approximately 38.7%.
Condensed Balance SheetsJune 30, 2023December 31, 2022
Current assets$130,951 $158,326 
Non-current assets6,972 6,019 
Total assets$137,923 $164,345 
Current liabilities$50,950 $77,306 
Non-current liabilities2,625 3,050 
Partners’ capital84,348 83,989 
Total liabilities and partners’ capital$137,923 $164,345 

Note 3.    Composition of Certain Financial Statement Captions
Receivables
Receivables on the accompanying Consolidated Balance Sheets consist of: 
September 30, 2022December 31, 2021June 30, 2023December 31, 2022
Trade receivablesTrade receivables$121,181 $111,209 Trade receivables$136,677 $110,722 
Fees earned, not billedFees earned, not billed332,457 315,255 Fees earned, not billed360,812 320,700 
Other receivablesOther receivables31,390 16,747 Other receivables25,047 26,563 
485,028 443,211 522,536 457,985 
Less: Allowance for doubtful accountsLess: Allowance for doubtful accounts(2,336)(1,602)Less: Allowance for doubtful accounts(936)(901)
$482,692 $441,609 $521,600 $457,084 
Fees earned, not billed represents receivables from contracts with customers earned but unbilled and results from timing differences between services provided and contractual billing schedules. These billing schedules generally provide for fees to be billed on a quarterly basis. In addition, certain fees earned from investment operations services are calculated based on assets under administration that have an extended valuation process. Billings to these clients occur once the asset valuation processes are completed.




12


Receivables from investment products on the accompanying Consolidated Balance Sheets primarily represent fees receivable for distribution, investment advisory, and administration services to various regulated investment companies and other investment products sponsored by SEI.





12


Property and Equipment
Property and Equipment on the accompanying Consolidated Balance Sheets consists of:
September 30, 2022December 31, 2021June 30, 2023December 31, 2022
BuildingsBuildings$210,108 $209,766 Buildings$216,338 $210,626 
EquipmentEquipment175,059 153,158 Equipment188,063 179,318 
LandLand26,439 24,651 Land26,439 26,439 
Purchased softwarePurchased software160,437 156,387 Purchased software162,987 160,714 
Furniture and fixturesFurniture and fixtures21,402 21,254 Furniture and fixtures22,599 21,956 
Leasehold improvementsLeasehold improvements19,590 21,946 Leasehold improvements21,562 20,879 
Construction in progressConstruction in progress960 955 Construction in progress634 1,958 
613,995 588,117 638,622 621,890 
Less: Accumulated depreciationLess: Accumulated depreciation(431,473)(409,248)Less: Accumulated depreciation(458,119)(440,861)
Property and Equipment, netProperty and Equipment, net$182,522 $178,869 Property and Equipment, net$180,503 $181,029 
The Company recognized $24,942$17,312 and $25,141$16,384 in depreciation expense related to property and equipment for the ninesix months ended SeptemberJune 30, 20222023 and 2021,2022, respectively.
Deferred Contract Costs
Deferred contract costs, which primarily consist of deferred sales commissions, were $37,790$38,561 and $36,236$37,928 as of SeptemberJune 30, 20222023 and December 31, 2021,2022, respectively. The Company deferred expenses related to contract costs of $4,648$3,225 and $2,932$1,543 during the three months ended SeptemberJune 30, 20222023 and 2021,2022, respectively. During the ninesix months ended SeptemberJune 30, 20222023 and 2021,2022, the Company deferred expenses related to contract costs of $9,710$4,969 and $6,978,$5,062, respectively. Amortization expense related to deferred contract costs were $8,156$4,336 and $6,496$5,945 during the ninesix months ended SeptemberJune 30, 20222023 and 2021,2022, respectively. Amortization expense during the ninesix months ended SeptemberJune 30, 2022 includes $1,784 in expense accelerated as a result of the termination of a contractual agreement with a significant client (See Note 13). Amortization expense related to deferred contract costs is included in Compensation, benefits and other personnel on the accompanying Consolidated Statements of Operations. There were no material impairment losses in relation to deferred contract costs during the ninesix months ended SeptemberJune 30, 2022.2023.
Accrued Liabilities
Accrued liabilities on the accompanying Consolidated Balance Sheets consist of: 
September 30, 2022December 31, 2021June 30, 2023December 31, 2022
Accrued employee compensationAccrued employee compensation$82,946 $107,933 Accrued employee compensation$58,627 $100,566 
Accrued employee benefits and other personnelAccrued employee benefits and other personnel7,142 13,951 Accrued employee benefits and other personnel4,353 9,852 
Accrued voluntary separation programAccrued voluntary separation program58,424 — Accrued voluntary separation program33,892 53,821 
Accrued consulting, outsourcing and professional feesAccrued consulting, outsourcing and professional fees41,919 36,411 Accrued consulting, outsourcing and professional fees38,106 37,009 
Accrued sub-advisory, distribution and other asset management feesAccrued sub-advisory, distribution and other asset management fees57,988 58,661 Accrued sub-advisory, distribution and other asset management fees50,259 52,916 
Accrued dividend payableAccrued dividend payable— 55,452 Accrued dividend payable291 58,051 
Other accrued liabilitiesOther accrued liabilities46,568 51,974 Other accrued liabilities51,636 47,148 
Total accrued liabilitiesTotal accrued liabilities$294,987 $324,382 Total accrued liabilities$237,164 $359,363 

Note 4.    Fair Value Measurements
The fair value of the Company’s financial assets and liabilities, except for the Company's investment funds sponsored by LSV, is determined in accordance with the fair value hierarchy. The fair value of the Company’s Level 1 financial assets consist mainly of investments in open-ended mutual funds that are quoted daily. Level 2 financial assets consist of GNMA mortgage-backed securities held by the Company's wholly-owned limited purpose federal thrift subsidiary, SEI Private Trust Company (SPTC), and Federal Home Loan Bank (FHLB) and other U.S. government agency short-term notes held




13


by SIDCO. The financial assets held by SIDCO were purchased as part of a cash management program requiring only short term, top-tier investment grade government and corporate securities. The financial assets held by SPTC are debt securities issued by GNMA and are backed by the full faith and credit of the U.S. government. These securities were




13


purchased for the sole purpose of satisfying applicable regulatory requirements and have maturity dates which range from 2023 to 2041.
The fair value of the Company's investment funds sponsored by LSV is measured using the net asset value per share (NAV) as a practical expedient. The NAVs of the funds are calculated by the funds' independent custodian and are derived from the fair values of the underlying investments as of the reporting date. The funds allow for investor redemptions at the end of each calendar month. This investment has not been classified in the fair value hierarchy but is presented in the tables below to permit reconciliation to the amounts presented on the accompanying Consolidated Balance Sheets.
The valuation of the Company's Level 2 financial assets held by SIDCO and SPTC are based upon securities pricing policies and procedures utilized by third-party pricing vendors.
The pricing policies and procedures applied for our Level 1 and Level 2 financial assets during the ninesix months ended SeptemberJune 30, 20222023 were consistent with those as described in the Company's Annual Report on Form 10-K at December 31, 2021.2022. The Company had no Level 3 financial assets at SeptemberJune 30, 20222023 or December 31, 20212022 that were required to be measured at fair value on a recurring basis. Level 3 financial liabilities at September 30, 2022 and December 31, 2021 consist entirely of the estimated contingent consideration resulting from an acquisition (See Note 12). The fair value of the contingent consideration was determined using a Monte-Carlo simulation model. Key assumptions for the Monte-Carlo simulation model include expected revenues, expected volatility, risk-free rate and other factors. There were no transfers of financial assets between levels within the fair value hierarchy during the ninesix months ended SeptemberJune 30, 2022.2023.
The fair value of certain financial assets of the Company was determined using the following inputs:
Fair Value Measurements at the End of the Reporting Period Using Fair Value Measurements at the End of the Reporting Period Using
AssetsAssetsSeptember 30, 2022Quoted Prices in
Active  Markets
for Identical
Assets
(Level 1)
Significant
Other
Observable
Inputs
(Level 2)
AssetsJune 30, 2023Quoted Prices in
Active  Markets
for Identical
Assets
(Level 1)
Significant
Other
Observable
Inputs
(Level 2)
Equity securitiesEquity securities$10,139 $10,139 $— Equity securities$10,826 $10,826 $— 
Available-for-sale debt securitiesAvailable-for-sale debt securities99,236 — 99,236 Available-for-sale debt securities105,965 — 105,965 
Fixed-income securities ownedFixed-income securities owned31,586 — 31,586 Fixed-income securities owned31,040 — 31,040 
Investment funds sponsored by LSV (1)Investment funds sponsored by LSV (1)5,620 Investment funds sponsored by LSV (1)6,772 
$146,581 $10,139 $130,822 $154,603 $10,826 $137,005 
Fair Value Measurements at the End of the Reporting Period Using Fair Value Measurements at the End of the Reporting Period Using
AssetsAssetsDecember 31, 2021Quoted Prices in
Active  Markets
for Identical
Assets
(Level 1)
Significant
Other
Observable
Inputs
(Level 2)
AssetsDecember 31, 2022Quoted Prices in
Active  Markets
for Identical
Assets
(Level 1)
Significant
Other
Observable
Inputs
(Level 2)
Equity securitiesEquity securities$12,406 $12,406 $— Equity securities$10,900 $10,900 $— 
Available-for-sale debt securitiesAvailable-for-sale debt securities117,135 — 117,135 Available-for-sale debt securities117,301 — 117,301 
Fixed-income securities ownedFixed-income securities owned28,267 — 28,267 Fixed-income securities owned32,148 — 32,148 
Investment funds sponsored by LSV (1)Investment funds sponsored by LSV (1)6,916 Investment funds sponsored by LSV (1)6,366 
$164,724 $12,406 $145,402 $166,715 $10,900 $149,449 
(1) The fair value amounts presented in the tables above are intended to permit reconciliation of the fair value hierarchy to the amounts presented on the accompanying Consolidated Balance Sheets (See Note 5).

Note 5.    Marketable Securities
Marketable securities include investments in money market funds and commercial paper classified as cash equivalents, available-for-sale debt securities, investments in SEI-sponsored and non-SEI-sponsored mutual funds, equities, investments in funds sponsored by LSV and securities owned by SIDCO.




14


Cash Equivalents
Investments in money market funds and commercial paper classified as cash equivalents had a fair value of $474,736$470,591 and $422,838$450,240 at SeptemberJune 30, 20222023 and December 31, 2021,2022, respectively. There were no material unrealized or realized gains or losses from these investments during the ninesix months ended SeptemberJune 30, 20222023 and 2021.2022. Investments in money market funds and commercial paper are Level 1 assets.




14


Available for Sale and Equity Securities
Available For Sale and Equity Securities on the accompanying Consolidated Balance Sheets consist of: 
At September 30, 2022 At June 30, 2023
Cost
Amount
Gross
Unrealized
Gains
Gross
Unrealized
(Losses)
Fair
Value
Cost
Amount
Gross
Unrealized
Gains
Gross
Unrealized
(Losses)
Fair
Value
Available-for-sale debt securitiesAvailable-for-sale debt securities$113,155 $— $(13,919)$99,236 Available-for-sale debt securities$117,727 $— $(11,762)$105,965 
SEI-sponsored mutual fundsSEI-sponsored mutual funds6,197 — (745)5,452 SEI-sponsored mutual funds5,315 206 (29)5,492 
Equities and other mutual fundsEquities and other mutual funds5,030 — (343)4,687 Equities and other mutual funds5,044 290 — 5,334 
$124,382 $— $(15,007)$109,375 $128,086 $496 $(11,791)$116,791 
At December 31, 2021 At December 31, 2022
Cost
Amount
Gross
Unrealized
Gains
Gross
Unrealized
(Losses)
Fair
Value
Cost
Amount
Gross
Unrealized
Gains
Gross
Unrealized
(Losses)
Fair
Value
Available-for-sale debt securitiesAvailable-for-sale debt securities$117,215 $— $(80)$117,135 Available-for-sale debt securities$129,372 $— $(12,071)$117,301 
SEI-sponsored mutual fundsSEI-sponsored mutual funds6,748 463 — 7,211 SEI-sponsored mutual funds6,207 — (176)6,031 
Equities and other mutual fundsEquities and other mutual funds4,935 260 — 5,195 Equities and other mutual funds5,026 — (157)4,869 
$128,898 $723 $(80)$129,541 $140,605 $— $(12,404)$128,201 
Net unrealized losses at SeptemberJune 30, 20222023 of available-for-sale debt securities were $10,718$9,057 (net of income tax benefit of $3,201)$2,705). Net unrealized losses at December 31, 20212022 of available-for-sale debt securities were $62$9,294 (net of income tax benefit of $18)$2,777). These unrealized losses are associated with the Company’s investments in mortgage-backed securities issued by GNMA and were caused by interest rate increases (See Note 4). The contractual cash flows of these securities are guaranteed by an agency of the U.S. government. Accordingly, it is expected that the securities would not be settled at a price less than the amortized cost bases of the Company's investments. The Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost bases. These net unrealized losses are reported as a separate component of Accumulated other comprehensive loss on the accompanying Consolidated Balance Sheets.
There were gross realized losses of $521$122 and $861$414 from available-for-sale debt securities during the ninesix months ended SeptemberJune 30, 20222023 and 2021,2022, respectively. There were no gross realized gains from available-for-sale debt securities during the ninesix months ended SeptemberJune 30, 20222023 and 2021.2022. Realized losses from available-for-sale debt securities, including amounts reclassified from accumulated comprehensive loss, are reflected in Net gain (loss) gain from investments on the accompanying Consolidated Statements of Operations.
There were gross realized gains of $226$44 and gross realized losses of $714$49 from mutual funds and equities during the ninesix months ended SeptemberJune 30, 2022.2023. There were gross realized gains of $714$7 and gross realized losses of $65$658 from mutual funds and equities during the ninesix months ended SeptemberJune 30, 2021.2022. Gains and losses from mutual funds and equities are reflected in Net gain (loss) gain from investments on the accompanying Consolidated Statements of Operations.
Investments in Affiliated Funds
The Company has an investment in funds sponsored by LSV. The Company records this investment on the accompanying Consolidated Balance Sheets at fair value. Unrealized gains and losses from the change in fair value of these funds are recognized in Net gain (loss) gain from investments on the accompanying Consolidated Statements of Operations.
The funds had a fair value of $5,620$6,772 and $6,916$6,366 at SeptemberJune 30, 20222023 and December 31, 2021,2022, respectively. The Company recognized unrealized gains of $235 and unrealized losses of $380 and $39$1,270 during the three months ended SeptemberJune 30, 20222023 and 2021,2022, respectively, from the change in fair value of the funds. The Company recognized unrealized gains of $406 and unrealized losses of $1,296 and unrealized gains of $727$916 during the ninesix months ended SeptemberJune 30, 20222023 and 2021,2022, respectively, from the change in fair value of the funds.




15


Securities Owned
The Company’s broker-dealer subsidiary, SIDCO, has investments in U.S. government agency securities with maturity dates less than one year. These investments are reflected as Securities owned on the accompanying Consolidated Balance Sheets. Due to specialized accounting practices applicable to investments by broker-dealers, the securities are reported at fair value and changes in fair value are recorded in current period earnings. The securities had a fair value of $31,586$31,040 and $28,267$32,148 at SeptemberJune 30, 20222023 and December 31, 2021,2022, respectively. There were no material net gains or losses related to the securities during the three and ninesix months ended SeptemberJune 30, 20222023 and 2021.2022.




15



Note 6.    Line of Credit
The Company has a five-year $325,000 Credit Agreement (the Credit Facility) with Wells Fargo Bank, N.A., and a syndicate of other lenders. The Credit Facility is scheduled to expire in April 2026, at which time any aggregate principal amount of loans outstanding becomes payable in full. Any borrowings made under the Credit Facility will accrue interest at rates that, at the Company's option, are based on a base rate (the Base Rate) plus a premium that can range from 0.25% to 1.00% or the London InterBank OfferedAdjusted Term Secured Overnight Financing Rate (LIBOR)(SOFR) plus a premium that can range from 1.25% to 2.00% depending on the Company’s Leverage Ratio (a ratio of consolidated indebtedness to consolidated EBITDA for the four preceding fiscal quarters, all as defined in the related agreement). The Base Rate is defined as the highest of a) the Prime Rate, b) the Federal Funds Rate as published by the Federal Reserve Bank of New York, plus 0.50%, b) the prime commercial lending rate of Wells Fargo, and c) the applicable LIBORAdjusted Term SOFR for a one-month tenor in effect on such day plus 1.00%, or d) 0%. The Credit Facility includes fallback language clearly defining an alternative reference rate which provides for specified replacement rates upon a LIBOR cessation event. At the time of a LIBOR cessation event, the replacement rate, the Secured Overnight Financing Rate (SOFR), self-executes without the need for negotiations or a formal amendment process.
The Company also pays quarterly commitment fees based on the unused portion of the Credit Facility. The quarterly fees for the Credit Facility can range from 0.15% of the amount of the unused portion to 0.30%, depending on the Company’s Leverage Ratio. Certain wholly-owned subsidiaries of the Company have guaranteed the obligations of the Company under the agreement. The aggregate amount of the Credit Facility may be increased by an additional $100,000 under certain conditions set forth in the agreement. The Company may issue up to $15,000 in letters of credit under the terms of the Credit Facility. The Company pays a periodic commission fee of 1.25% plus an issuance fee of 0.20% of the aggregate face amount of the outstanding letters of credit issued under the Credit Facility.
The Credit Facility contains covenants with restrictions on the ability of the Company to do transactions with affiliates other than wholly-owned subsidiaries or to incur liens or certain types of indebtedness as defined in the agreement. In the event of a default under the Credit Facility, the Company would also be restricted from paying dividends on, or repurchasing, its common stock without the approval of the lenders. Upon the occurrence of certain financial or economic events, significant corporate events, or certain other events of default constituting an event of default under the Credit Facility, all loans outstanding may be declared immediately due and payable and all commitments under the agreement may be terminated.
In November 2021,On April 17, 2023, the Company borrowed $40,000 underand the lenders amended the Credit Facility to add SOFR as an alternative reference rate for borrowings in place of LIBOR. All other terms and conditions of the funding of an acquisition (See Note 12). During the nine months ended September 30, 2022, theoriginal agreement remain in effect.
The Company made principal payments of $40,000 to fully repay the outstanding balancewas in compliance with all covenants of the Credit Facility.Facility during the six months ended June 30, 2023.
As of October 20, 2022,July 13, 2023, the Company had outstanding letters of credit of $6,003$4,866 under the Credit Facility. These letters of credit were issued primarily for the expansion of the Company's headquarters and are scheduled to expire during 2022.2023. The amount of the Credit Facility that is available for general corporate purposes as of October 20, 2022July 13, 2023 was $318,997.
The Company was in compliance with all covenants of the Credit Facility during the nine months ended September 30, 2022.$320,134.

Note 7.    Shareholders’ Equity
Stock-Based Compensation
The Company has only non-qualified stock options and restricted stock units outstanding under its equity compensation plans. The Company recognized stock-based compensation expense in its Consolidated Financial Statements in the three and six months ended June 30, 2023 and 2022, respectively, as follows:
Three Months Ended June 30,Six Months Ended June 30,
 2023202220232022
Stock-based compensation expense$7,405 $10,007 $15,479 $20,573 
Less: Deferred tax benefit(1,347)(1,839)(2,839)(3,934)
Stock-based compensation expense, net of tax$6,058 $8,168 $12,640 $16,639 
All outstanding stock options have performance-based vesting provisions specific to each option grant that tie the vesting of the applicable stock options to the Company’s financial performance. The Company’s stock options vest at a rate of 50% when a specified financial vesting target is achieved, and the remaining 50% when a second, higher specified financial vesting target is achieved. Options vest as a result of achievement of the financial vesting targets. Options granted in December 2017 and thereafter include a service condition which requires a minimum two or four year waiting period from the grant date along with the attainment of the applicable financial vesting target. The targets are measured




16


annually on December 31. The amount of stock-based compensation expense recognized in the period is based upon management’s estimate of when the financial vesting targets may be achieved. Any change in management’s estimate could result in the remaining amount of stock-based compensation expense to be accelerated, spread out over a longer




16


period, or reversed. This may cause volatility in the recognition of stock-based compensation expense in future periods and could materially affect the Company’s earnings. The Company's restricted stock units outstanding vest ratably over four years from the date the award is granted.
The Company recognized stock-based compensation expense in its Consolidated Financial Statements in the three and nine months ended September 30, 2022 and 2021, respectively, as follows:
Three Months Ended September 30,Nine Months Ended September 30,
 2022202120222021
Stock-based compensation expense$10,766 $11,318 $31,339 $31,173 
Less: Deferred tax benefit(1,917)(1,857)(5,851)(5,615)
Stock-based compensation expense, net of tax$8,849 $9,461 $25,488 $25,558 
The Company revised its estimate of when some vesting targets are expected to be achieved. This change in management's estimate resulted in a decrease of $2,779$2,776 in stock-based compensation expense during the ninesix months ended SeptemberJune 30, 2022.2023.
As of SeptemberJune 30, 2022,2023, there was approximately $72,913$99,899 of unrecognized compensation cost remaining related to unvested employee stock options and restricted stock units that management expects will vest and is being amortized.
The Company issues new common shares associated with the exercise of stock options. The total intrinsic value of options exercised during the ninesix months ended SeptemberJune 30, 20222023 was $18,147.$10,019. The total options exercisable as of SeptemberJune 30, 20222023 had an intrinsic value of $33,688.$67,512. The total intrinsic value for options exercisable is calculated as the difference between the market value of the Company’s common stock as of SeptemberJune 30, 20222023 and the weighted average exercise price of the options. The market value of the Company’s common stock as of SeptemberJune 30, 20222023 was $49.05$59.62 as reported by the Nasdaq Stock Market, LLC. The weighted average exercise price of the options exercisable as of SeptemberJune 30, 20222023 was $49.90.$53.17. Total options that were outstanding as of SeptemberJune 30, 20222023 were 17,645,00017,509,000. Total options that were exercisable as of SeptemberJune 30, 20222023 were 7,705,0008,325,000.
The Company initiated a voluntary separation program to long-tenured employees which was finalized in July 2022. Certain allowances provided to the participating employees in the program resulted in modifications to the Company's equity compensation plans related to the vesting of stock options during the remainder of 2022 and the period in which the employee may exercise vested stock options after the termination of employment (See Note 14). The Company incurred additional stock-based compensation expense of $2,307 as a result of these modifications. The Company accounts for stock option forfeitures as they occur. During the three months ended September 30, 2022, the Company reversed previously recognized stock-option expense of $784 as a result of the cancellation of certain stock option awards to employees participating in the voluntary separation program.
Common Stock Buyback
The Company’s Board of Directors, under multiple authorizations, has authorized the repurchase of common stock on the open market or through private transactions. The Company purchased 4,573,0002,651,000 shares at a total cost of $258,817$155,869 during the ninesix months ended SeptemberJune 30, 2022,2023, which reduced the total shares outstanding of common stock. The cost of stock purchases during the period includes the cost of excise taxes applicable to stock repurchases and certain transactions that settled in the following quarter. On June 1, 2022,April 18, 2023, the Company's Board of Directors approved an increase in the stock repurchase program by an additional $200,000.$250,000. As of SeptemberJune 30, 2022,2023, the Company had approximately $172,477$186,983,274 of authorization remaining for the purchase of common stock under the program.
The Company immediately retires its common stock when purchased. Upon retirement, the Company reduces Capital in excess of par value for the average capital per share outstanding and the remainder is charged against Retained earnings. If the Company reduces its Retained earnings to zero, any subsequent purchases of common stock will be charged entirely to Capital in excess of par value.
Cash Dividend
On June 1, 2022,May 31, 2023, the Board of Directors declared a cash dividend of $0.40$0.43 per share on the Company's common stock, which was paid on June 22, 2022,21, 2023, to shareholders of record on June 13, 2022.12, 2023. Cash dividends declared during the ninesix months ended SeptemberJune 30, 2023 and 2022 were $57,177 and 2021 were $54,378, and $52,389, respectively.





17


Note 8.    Accumulated Other Comprehensive Loss
The components of Accumulated other comprehensive loss, net of tax, are as follows: 
Foreign
Currency
Translation
Adjustments
Unrealized
Gains (Losses)
on Investments
Accumulated Other Comprehensive Loss
Balance, January 1, 2022$(19,781)$(62)$(19,843)
Other comprehensive loss before reclassifications(37,090)(11,057)(48,147)
Amounts reclassified from accumulated other comprehensive loss— 401 401 
Net current-period other comprehensive loss(37,090)(10,656)(47,746)
Balance, September 30, 2022$(56,871)$(10,718)$(67,589)
Foreign
Currency
Translation
Adjustments
Unrealized
Gains (Losses)
on Investments
Accumulated Other Comprehensive Loss
Balance, January 1, 2023$(39,673)$(9,294)$(48,967)
Other comprehensive income before reclassifications8,751 144 8,895 
Amounts reclassified from accumulated other comprehensive loss— 93 93 
Net current-period other comprehensive income8,751 237 8,988 
Balance, June 30, 2023$(30,922)$(9,057)$(39,979)

Note 9.    Business Segment Information
The Company’s reportable business segments are:
Private Banks – Provides outsourced investment processing and investment management platforms to banks and trust institutions, independent wealth advisers and financial advisors worldwide;




17


Investment Advisors – Provides investment management and investment processing platforms to affluent investors through a network of independent registered investment advisors, financial planners and other investment professionals in the United States;
Institutional Investors – Provides OCIOOutsourced Chief Investment Officer and Enhanced Chief Investment Officer solutions, including investment management and administrative outsourcing platforms to retirement plan sponsors, healthcare systems, higher education and other not-for-profit organizations worldwide;
Investment Managers – Provides investment operations outsourcing platforms to fund companies, banking institutions, traditional and non-traditional investment managers worldwide and family offices in the United States; and
Investments in New Businesses – Focuses on providing investment management solutions to ultra-high-net-worth families residing in the United States; developing network and data protection services; modularizing larger technology platforms into stand-alone components;platforms; entering new markets; and conducting other research and development activities.
The information in the following tables is derived from internal financial reporting used for corporate management purposes. There are no inter-segment revenues for the three and ninesix months ended SeptemberJune 30, 20222023 and 2021.2022. Assets are not allocated to segments for internal reporting purposes. The accounting policies of the reportable business segments are the same as those described in Note 1 to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021.




18


2022.
The following tables highlight certain financial information about each of the business segments for the three months ended SeptemberJune 30, 20222023 and 2021:2022:
Private
Banks
Investment
Advisors
Institutional
Investors
Investment
Managers
Investments
In New
Businesses
Total
Private
Banks
Investment
Advisors
Institutional
Investors
Investment
Managers
Investments
In New
Businesses
Total
For the Three Months Ended September 30, 2022 For the Three Months Ended June 30, 2023
RevenuesRevenues$122,660 $109,565 $78,260 $156,015 $4,834 $471,334 Revenues$134,099 $109,580 $75,145 $165,339 $4,894 $489,057 
ExpensesExpenses116,661 61,150 42,149 100,876 9,915 330,751 Expenses116,061 64,178 45,516 107,761 10,571 344,087 
Operating profit (loss)Operating profit (loss)$5,999 $48,415 $36,111 $55,139 $(5,081)$140,583 Operating profit (loss)$18,038 $45,402 $29,629 $57,578 $(5,677)$144,970 
Private
Banks
Investment
Advisors
Institutional
Investors
Investment
Managers
Investments
In New
Businesses
TotalPrivate
Banks
Investment
Advisors
Institutional
Investors
Investment
Managers
Investments
In New
Businesses
Total
For the Three Months Ended September 30, 2021 For the Three Months Ended June 30, 2022
RevenuesRevenues$123,018 $124,768 $85,759 $147,412 $4,365 $485,322 Revenues$124,184 $113,194 $83,483 $155,926 $4,883 $481,670 
ExpensesExpenses116,679 62,107 41,643 89,594 12,820 322,843 Expenses121,060 63,375 43,925 100,807 12,844 342,011 
Operating profit (loss)Operating profit (loss)$6,339 $62,661 $44,116 $57,818 $(8,455)$162,479 Operating profit (loss)$3,124 $49,819 $39,558 $55,119 $(7,961)$139,659 




18


A reconciliation of the total operating profit reported for the business segments to income from operations in the Consolidated Statements of Operations for the three months ended SeptemberJune 30, 20222023 and 20212022 is as follows:
20222021
Total operating profit from segments$140,583 $162,479 
Corporate overhead expenses (1)(89,537)(21,354)
Income from operations$51,046 $141,125 
(1) Corporate overhead expenses include the total costs for the Voluntary Separation Program (See Note 14).
20232022
Total operating profit from segments$144,970 $139,659 
Corporate overhead expenses(32,369)(23,799)
Income from operations$112,601 $115,860 
The following tables provide additional information for the three months ended SeptemberJune 30, 20222023 and 20212022 pertaining to the business segments:
Capital Expenditures (2)Depreciation Capital Expenditures (1)Depreciation
2022202120222021 2023202220232022
Private BanksPrivate Banks$8,404 $6,173 $5,050 $4,980 Private Banks$8,001 $8,541 $5,450 $5,554 
Investment AdvisorsInvestment Advisors3,476 2,896 513 499 Investment Advisors3,615 3,423 549 469 
Institutional InvestorsInstitutional Investors1,080 720 283 271 Institutional Investors457 1,028 303 285 
Investment ManagersInvestment Managers9,843 3,722 2,498 2,428 Investment Managers2,592 4,113 2,210 1,755 
Investments in New BusinessesInvestments in New Businesses227 336 36 60 Investments in New Businesses202 208 63 44 
Total from business segmentsTotal from business segments$23,030 $13,847 $8,380 $8,238 Total from business segments$14,867 $17,313 $8,575 $8,107 
Corporate overheadCorporate overhead486 419 178 170 Corporate overhead362 445 206 179 
$23,516 $14,266 $8,558 $8,408 $15,229 $17,758 $8,781 $8,286 
(2)(1) Capital expenditures include additions to property and equipment and capitalized software.
Amortization Amortization
20222021 20232022
Private BanksPrivate Banks$4,515 $8,526 Private Banks$4,718 $8,261 
Investment AdvisorsInvestment Advisors1,736 3,014 Investment Advisors1,945 3,158 
Institutional InvestorsInstitutional Investors1,808 427 Institutional Investors1,829 2,257 
Investment ManagersInvestment Managers2,121 2,451 Investment Managers929 2,577 
Investments in New BusinessesInvestments in New Businesses145 185 Investments in New Businesses144 185 
Total from business segmentsTotal from business segments$10,325 $14,603 Total from business segments$9,565 $16,438 
Corporate overheadCorporate overhead57 71 Corporate overhead65 70 
$10,382 $14,674 $9,630 $16,508 




19


The following tables highlight certain financial information about each of business segment for the ninesix months ended SeptemberJune 30, 20222023 and 2021:2022:
Private
Banks
Investment
Advisors
Institutional
Investors
Investment
Managers
Investments
In New
Businesses
TotalPrivate
Banks
Investment
Advisors
Institutional
Investors
Investment
Managers
Investments
In New
Businesses
Total
For the Nine Months Ended September 30, 2022 For the Six Months Ended June 30, 2023
RevenuesRevenues$460,392 $341,989 $248,582 $468,842 $14,642 $1,534,447 Revenues$256,702 $216,118 $149,435 $326,025 $9,896 $958,176 
ExpensesExpenses359,676 189,045 131,432 300,520 34,709 1,015,382 Expenses230,337 127,724 86,384 213,627 22,215 680,287 
Operating profit (loss)Operating profit (loss)$100,716 $152,944 $117,150 $168,322 $(20,067)$519,065 Operating profit (loss)$26,365 $88,394 $63,051 $112,398 $(12,319)$277,889 
Private
Banks
Investment
Advisors
Institutional
Investors
Investment
Managers
Investments
In New
Businesses
TotalPrivate
Banks
Investment
Advisors
Institutional
Investors
Investment
Managers
Investments
In New
Businesses
Total
For the Nine Months Ended September 30, 2021 For the Six Months Ended June 30, 2022
RevenuesRevenues$364,302 $357,458 $255,957 $426,639 $12,303 $1,416,659 Revenues$337,732 $232,424 $170,322 $312,827 $9,808 $1,063,113 
ExpensesExpenses345,057 176,267 122,696 257,609 39,855 941,484 Expenses243,015 127,895 89,283 199,644 24,794 684,631 
Operating profit (loss)Operating profit (loss)$19,245 $181,191 $133,261 $169,030 $(27,552)$475,175 Operating profit (loss)$94,717 $104,529 $81,039 $113,183 $(14,986)$378,482 
A reconciliation of the total operating profit reported for the business segments to income from operations in the Consolidated Statements of Operations for the ninesix months ended SeptemberJune 30, 20222023 and 2021:2022:
20222021
Total operating profit from segments$519,065 $475,175 
Corporate overhead expenses (1)(137,360)(65,192)
Income from operations$381,705 $409,983 
(1) Corporate overhead expenses include the total costs for the Voluntary Separation Program (See Note 14).
20232022
Total operating profit from segments$277,889 $378,482 
Corporate overhead expenses(63,521)(47,823)
Income from operations$214,368 $330,659 
The following tables provide additional information for the ninesix months ended SeptemberJune 30, 20222023 and 2021:2022:
Capital Expenditures (2)Depreciation Capital Expenditures (2)Depreciation
2022202120222021 2023202220232022
Private BanksPrivate Banks$24,167 $20,596 $15,710 $13,290 Private Banks$17,072 $15,763 $10,804 $10,660 
Investment AdvisorsInvestment Advisors9,926 8,784 1,438 3,205 Investment Advisors7,954 6,450 1,017 925 
Institutional InvestorsInstitutional Investors3,057 2,115 857 982 Institutional Investors1,105 1,977 585 574 
Investment ManagersInvestment Managers17,980 8,726 6,273 6,508 Investment Managers7,198 8,137 4,365 3,775 
Investments in New BusinessesInvestments in New Businesses640 788 124 306 Investments in New Businesses544 413 131 88 
Total from business segmentsTotal from business segments$55,770 $41,009 $24,402 $24,291 Total from business segments$33,873 $32,740 $16,902 $16,022 
Corporate OverheadCorporate Overhead1,376 997 540 850 Corporate Overhead977 890 410 362 
$57,146 $42,006 $24,942 $25,141 $34,850 $33,630 $17,312 $16,384 
(2) Capital expenditures include additions to property and equipment and capitalized software.
Amortization Amortization
20222021 20232022
Private BanksPrivate Banks$21,315 $25,735 Private Banks$9,364 $16,800 
Investment AdvisorsInvestment Advisors8,127 8,550 Investment Advisors3,763 6,391 
Institutional InvestorsInstitutional Investors6,348 1,280 Institutional Investors3,653 4,540 
Investment ManagersInvestment Managers7,274 7,375 Investment Managers1,856 5,153 
Investments in New BusinessesInvestments in New Businesses515 555 Investments in New Businesses289 370 
Total from business segmentsTotal from business segments$43,579 $43,495 Total from business segments$18,925 $33,254 
Corporate OverheadCorporate Overhead198 254 Corporate Overhead129 141 
$43,777 $43,749 $19,054 $33,395 





20


Note 10.    Income Taxes
The gross liability for unrecognized tax benefits at SeptemberJune 30, 20222023 and December 31, 20212022 was $17,718$16,741 and $14,887,$15,204, respectively, exclusive of interest and penalties, of which $16,973$16,197 and $14,382$14,431 would affect the effective tax rate if the Company were to recognize the tax benefit.
The Company classifies interest and penalties on unrecognized tax benefits as income tax expense. As of SeptemberJune 30, 20222023 and December 31, 2021,2022, the combined amount of accrued interest and penalties related to tax positions taken on tax returns was $1,458$1,630 and $1,338,$1,118, respectively.
September 30, 2022December 31, 2021June 30, 2023December 31, 2022
Gross liability for unrecognized tax benefits, exclusive of interest and penaltiesGross liability for unrecognized tax benefits, exclusive of interest and penalties$17,718 $14,887 Gross liability for unrecognized tax benefits, exclusive of interest and penalties$16,741 $15,204 
Interest and penalties on unrecognized benefitsInterest and penalties on unrecognized benefits1,458 1,338 Interest and penalties on unrecognized benefits1,630 1,118 
Total gross uncertain tax positionsTotal gross uncertain tax positions$19,176 $16,225 Total gross uncertain tax positions$18,371 $16,322 
Amount included in Current liabilitiesAmount included in Current liabilities$4,190 $4,253 Amount included in Current liabilities$4,168 $4,065 
Amount included in Other long-term liabilitiesAmount included in Other long-term liabilities14,986 11,972 Amount included in Other long-term liabilities14,203 12,257 
$19,176 $16,225 $18,371 $16,322 
The effective income tax rate for the three and ninesix months ended SeptemberJune 30, 20222023 and 20212022 differs from the federal income tax statutory rate due to the following:
Three Months Ended September 30,Nine Months Ended September 30,Three Months Ended June 30,Six Months Ended June 30,
20222021202220212023202220232022
Statutory rateStatutory rate21.0 %21.0 %21.0 %21.0 %Statutory rate21.0 %21.0 %21.0 %21.0 %
State taxes, net of federal tax benefitState taxes, net of federal tax benefit3.4 2.5 2.9 3.0 State taxes, net of federal tax benefit2.8 2.8 2.8 2.8 
Foreign tax expense and tax rate differentialForeign tax expense and tax rate differential(0.2)(0.1)(0.1)(0.1)Foreign tax expense and tax rate differential(0.2)(0.1)(0.2)(0.1)
Tax benefit from stock option exercisesTax benefit from stock option exercises(1.1)(0.6)(0.5)(1.0)Tax benefit from stock option exercises(0.1)(0.3)(0.2)(0.3)
State settlements— (0.3)— (0.2)
Provision-to-return adjustment— (0.5)— (0.2)
Other, netOther, net(0.1)(0.3)(0.2)(0.3)Other, net(0.1)(0.3)0.1 (0.3)
23.0 %21.7 %23.1 %22.2 %23.4 %23.1 %23.5 %23.1 %
The increase in the Company's effective tax rate for the three and six months ended SeptemberJune 30, 2022 was primarily due to an increase in the state effective tax rate and one-time state settlements which reduced the effective rate in 2021. Provision-to-return adjustments and statutory limitations which lowered the 2021 effective rate are expected to be realized in the fourth quarter of 2022. The increase was partially offset by increased tax benefits related to the stock option exercises as a percentage of net income in the third quarter of 2022 compared to the third quarter of 2021.
The increase in the Company's effective tax rate for the nine months ended September 30, 20222023 was primarily due to decreased tax benefits related to the lower volume of stock option exercises and a decrease in 2022credits associated with research and development as compared to the prior year period as well as the timing of one-time state settlements which reduced the effective rate in 2021. Provision-to-return adjustments and statutory limitations which lowered the 2021 effective rate for the nine month period are expected to be realized in the fourth quarter of 2022.period.
The Company files income tax returns in the United States on a consolidated basis and in many U.S. state and foreign jurisdictions. The Company is subject to examination of income tax returns by the Internal Revenue Service (IRS) and other domestic and foreign tax authorities. The Company is no longer subject to U.S. federal income tax examination for years before 20182019 and is no longer subject to state, local or foreign income tax examinations by authorities for years before 2015.
The Company estimates it will recognize $4,190$4,168 of gross unrecognized tax benefits. This amount is expected to be paid within one year or to be removed at the expiration of the statute of limitations and resolution of income tax audits and is netted against the current payable account. These unrecognized tax benefits are related to tax positions taken on certain federal, state, and foreign tax returns. However, the timing of the resolution of income tax examinations is highly uncertain, and the amounts ultimately paid, if any, upon resolution of the issues raised by the taxing authorities may differ materially from the amounts accrued for each year. While it is reasonably possible that some issues under examination could be resolved in the next twelve months, based upon the current facts and circumstances, the Company cannot reasonably




21


estimate the timing of such resolution or the total range of potential changes as it relates to the current unrecognized tax benefits that are recorded as part of the Company’s financial statements.
On July 8, 2022, House Bill 1342 was signed into law in the Commonwealth of Pennsylvania, making significant changes to the corporate income tax rate. The bill reduces the corporate income tax rate from 9.99% to 4.99% with reductions occurring in phases beginning each tax year from January 1, 2023 through January 1, 2031. U.S. GAAP requires companies to recognize the effect of tax law changes in the period of enactment. The Company is currently evaluating the enactment of this law but does not expect the impact on its consolidated financial statements and related disclosures to be material.
On August 16, 2022, President Biden signed into law H.R. 5376, commonly referred to as the Inflation Reduction Act of 2022 (IRA). IRA introduces a new 15% corporate alternative minimum tax as well as a 1% excise tax on repurchases of stock by certain publicly traded corporations. Both of these provisions begin for tax years beginning after December 31, 2022. The Company is currently evaluating the enactment of IRA but does not expect the impact on its consolidated financial statements and related disclosures to be material.

Note 11.    Commitments and Contingencies
In the ordinary course of business, the Company from time to time enters into contracts containing indemnification obligations of the Company. These obligations may require the Company to make payments to another party upon the occurrence of certain events including the failure by the Company to meet its performance obligations under the contract. These contractual indemnification provisions are often standard contractual terms of the nature customarily found in the type of contracts entered into by the Company. In many cases, there are no stated or notional amounts included in the indemnification provisions. The amounts recognized as of June 30, 2023 on the Consolidated Balance Sheet related to




21


these indemnifications are not material. There are no amounts reflectedrecognized on the Consolidated Balance SheetsSheet as of September 30, 2022 and December 31, 20212022 related to these indemnifications.
Stanford Trust Company Litigation
There has been no material change to the status of the litigations related to the Stanford Trust Company matters or the Company’s expectations with respect to such matters as previously reported in the Company’s quarterly report on Form 10-Q as filed with the Commission on April 25, 2022.
SS&C Advent Matter
On February 28, 2020, SEI Global Services, Inc. (SGSI), a wholly-owned subsidiary of the Company, filed a complaint under seal in the United States District Court for the Eastern District of Pennsylvania against SS&C Advent (Advent) and SS&C Technologies Holdings, Inc. (SS&C) alleging that SS&C and Advent breached the terms of the contract between the parties and asking the Court to hold SS&C and Advent to their bargained-for obligations (the Advent Matter). In addition to Breach of Contract, the complaint also included counts for Declaratory Judgment, Tortious Interference with Existing and Prospective Contractual Relations, Violation of the New York General Business Law Section 349, Violations of Section 2 of the Sherman Antitrust Act, Promissory Estoppel and Breach of the Covenant of Good Faith and Fair Dealing. SGSI sought various forms of relief, including declaratory judgment, specific performance under the contract, and monetary damages, including punitive damages, treble damages and attorney’s fees.
On October 23, 2020, the federal court dismissed SEI’s federal antitrust claims but declined to rule on the state law claims. SGSI appealed the dismissal of the federal anti-trust claims to the Third Circuit Court of Appeals. On June 30, 2022, the Third Circuit Court of Appeals issued an order denying SGSI’s appeal of the District Court’s ruling.
Beginning in October 23, 2020, Advent and SGSI litigated the remaining breach of contract, breach of the implied duty of good faith and fair dealing, and tortious interference with contract claims in New York State Court. New York State Court rulings during the litigation of the Advent Matter affirmed the validity and enforceability of SGSI’s perpetual license to Advent’s Geneva software.
On September 26, 2022, the parties entered into a confidential settlement agreement of the outstanding issues being litigated in the Advent Matter.
On October 3, 2022, Judge Borrok of the New York State Court issued an Order dismissing the Advent Matter in connection with the settlement agreement.
Other MattersLegal Proceedings
The Company and certain of its subsidiaries areis a party to various other examinations, investigations,disputes, actions and claims arising in the normal course of business that the Company does not believe are material. The Company believes that the ultimate resolution of these matters will not have a material adverse effect on the Company's financial position or the manner in which the Company conducts its business. Currently, the Company does not believe the amount of losses, if any, associated with these matters can be estimated. While the Company does not believe that the amount of such losses will,




22


when liquidated or estimable, be material to its financial position, the assumptions upon which these beliefs are based may be incorrect and, if so, any such loss could have a material adverse effect on the Company's results of operations or the manner in which the Company conducts its business in the period(s) during which the underlying matters are resolved.

Note 12.    Goodwill and Intangible Assets
The changes in the carrying amount of the Company's goodwill by segment are as follows:
Institutional InvestorsInvestment ManagersInvestments in New BusinessesTotal
Balance, December 31, 2021$48,911 $56,822 $11,499 $117,232 
Measurement period adjustments103 216 — 319 
Foreign currency translation adjustments— (42)— (42)
Balance, September 30, 2022$49,014 $56,996 $11,499 $117,509 
In October 2021, the Company acquired all ownership interests of Finomial Corporation (Finomial). The excess purchase price over the estimated value of the net tangible and identifiable intangible assets was allocated to goodwill. The total amount of goodwill from this transaction amounted to $4,036 and is included in the accompanying Consolidated Balance Sheets.
In November 2021, the Company acquired all ownership interests of Novus Partners (Novus). The excess purchase price over the estimated value of the net tangible and identifiable intangible assets was allocated to goodwill. The total amount of goodwill from this transaction amounted to $48,911 and is included in the accompanying Consolidated Balance Sheets.
In addition to the intangible assets acquired through the acquisitions of Finomial and Novus, during 2021, the Company also acquired intangible assets through the purchase of a technology platform providing digital collaboration tools for financial advisors and the purchase of the Atlas Master Trust, a defined contribution master trust in the United Kingdom.
Institutional InvestorsInvestment ManagersInvestments in New BusinessesTotal
Balance, December 31, 2022$47,108 $56,992 $11,499 $115,599 
Foreign currency translation adjustments— — 
Balance, June 30, 2023$47,108 $56,995 $11,499 $115,602 
In April 2018, the Company acquired all ownership interests of Huntington Steele, LLC (Huntington Steele). The total purchase price was allocated to Huntington Steele’s net tangible and intangible assets based upon their estimated fair values at the date of purchase. The excess purchase price over the value of the identifiable intangible assets was recorded as goodwill. The total amount of goodwill from this transaction amounted to $11,499 and is included on the accompanying Consolidated Balance Sheets. The total purchase price for Huntington Steele included a contingent purchase price payable to the sellers upon the attainment of specified financial measureswhich is determined at various intervals occurring between 2019 and 2023. The Company made payments of $868$904 and $3,965$868 during the ninesix months ended SeptemberJune 30, 20222023 and 2021,2022, respectively, to the sellers. As of SeptemberJune 30, 2022,2023, the remaining amount of the contingent consideration of $9,271$8,177 is included in Accrued liabilities on the accompanying Balance Sheet. During July 2023, the Company exercised its option to settle the contingent consideration and made payments totaling $7,985 to the sellers.
The Company recognized $9,534$6,113 and $3,312$6,496 of amortization expense related to theacquired intangible assets acquired during the ninesix months ended SeptemberJune 30, 20222023 and 2021,2022, respectively.

Note 13.    Revenues from Contracts with Customers
The Company’s principal sources of revenues are: (1) asset management, administration and distribution fees primarily earned based upon a contractual percentage of net assets under management or administration; and (2) information processing and software servicing fees that are either recurring and primarily earned based upon the number of trust accounts being serviced or a percentage of the market value of the clients' assets processed on the Company's platforms, or non-recurring and based upon project-oriented contractual agreements related to client implementations.




2322


Disaggregation of Revenue
The following tables provide additional information pertaining to our revenues disaggregated by major product line and primary geographic market based on the location of the use of the products or services for each of the business segments for the three months ended SeptemberJune 30, 20222023 and 2021:2022:
Private
Banks
Investment
Advisors
Institutional
Investors
Investment
Managers
Investments
In New
Businesses
Total
Private
Banks
Investment
Advisors
Institutional
Investors
Investment
Managers
Investments
In New
Businesses
Total
Major Product Lines:Major Product Lines:For the Three Months Ended September 30, 2022Major Product Lines:For the Three Months Ended June 30, 2023
Investment management fees from pooled investment productsInvestment management fees from pooled investment products$30,002 $63,688 $12,928 $81 $367 $107,066 Investment management fees from pooled investment products$32,092 $61,103 $13,154 $104 $352 $106,805 
Investment management fees from investment management agreementsInvestment management fees from investment management agreements633 39,915 60,887 — 3,992 105,427 Investment management fees from investment management agreements824 43,159 56,627 — 4,025 104,635 
Investment operations feesInvestment operations fees336 — — 144,181 — 144,517 Investment operations fees337 — — 152,713 — 153,050 
Investment processing fees - PaaSInvestment processing fees - PaaS57,818 — — — — 57,818 Investment processing fees - PaaS56,713 2,296 280 75 20 59,384 
Investment processing fees - SaaSInvestment processing fees - SaaS29,855 — 2,650 3,963 — 36,468 Investment processing fees - SaaS28,581 — 2,790 4,296 — 35,667 
Professional services fees(1)Professional services fees(1)3,195 — — 798 — 3,993 Professional services fees(1)14,589 — — 730 — 15,319 
Account fees and otherAccount fees and other821 5,962 1,795 6,992 475 16,045 Account fees and other963 3,022 2,294 7,421 497 14,197 
Total revenuesTotal revenues$122,660 $109,565 $78,260 $156,015 $4,834 $471,334 Total revenues$134,099 $109,580 $75,145 $165,339 $4,894 $489,057 
Primary Geographic Markets:Primary Geographic Markets:Primary Geographic Markets:
United StatesUnited States$81,628 $109,565 $65,571 $141,928 $4,834 $403,526 United States$91,282 $109,580 $63,123 $150,533 $4,894 $419,412 
United KingdomUnited Kingdom27,186 — 9,729 — — 36,915 United Kingdom27,984 — 8,684 — — 36,668 
CanadaCanada10,495 — 1,357 — — 11,852 Canada10,148 — 1,447 — — 11,595 
IrelandIreland3,351 — 1,570 9,580 — 14,501 Ireland4,685 — 1,891 8,978 — 15,554 
LuxembourgLuxembourg— — — 4,507 — 4,507 Luxembourg— — — 5,828 — 5,828 
Other— — 33 — — 33 
Total revenuesTotal revenues$122,660 $109,565 $78,260 $156,015 $4,834 $471,334 Total revenues$134,099 $109,580 $75,145 $165,339 $4,894 $489,057 

(1) Professional services fees of the Private Banks segment includes a one-time early contractual buyout fee of $10,457 recorded during the three months ended June 30, 2023 from an investment processing client acquired by an existing client.




2423


Private
Banks
Investment
Advisors
Institutional
Investors
Investment
Managers
Investments
In New
Businesses
TotalPrivate
Banks
Investment
Advisors
Institutional
Investors
Investment
Managers
Investments
In New
Businesses
Total
Major Product Lines:Major Product Lines:For the Three Months Ended September 30, 2021Major Product Lines:For the Three Months Ended June 30, 2022
Investment management fees from pooled investment productsInvestment management fees from pooled investment products$34,212 $77,123 $13,639 $32 $338 $125,344 Investment management fees from pooled investment products$31,993 $67,490 $15,700 $123 $402 $115,708 
Investment management fees from investment management agreementsInvestment management fees from investment management agreements605 41,688 71,964 — 3,864 118,121 Investment management fees from investment management agreements616 40,398 63,212 — 4,073 108,299 
Investment operations feesInvestment operations fees363 — — 136,978 — 137,341 Investment operations fees344 — — 144,742 — 145,086 
Investment processing fees - PaaSInvestment processing fees - PaaS54,191 — — — — 54,191 Investment processing fees - PaaS56,378 — — — — 56,378 
Investment processing fees - SaaSInvestment processing fees - SaaS28,579 — — 3,848 — 32,427 Investment processing fees - SaaS29,845 — 3,021 3,911 — 36,777 
Professional services feesProfessional services fees4,174 — — 871 — 5,045 Professional services fees4,096 — — 635 — 4,731 
Account fees and otherAccount fees and other894 5,957 156 5,683 163 12,853 Account fees and other912 5,306 1,550 6,515 408 14,691 
Total revenuesTotal revenues$123,018 $124,768 $85,759 $147,412 $4,365 $485,322 Total revenues$124,184 $113,194 $83,483 $155,926 $4,883 $481,670 
Primary Geographic Markets:Primary Geographic Markets:Primary Geographic Markets:
United StatesUnited States$77,260 $124,768 $68,810 $136,934 $4,365 $412,137 United States$96,115 $113,194 $68,702 $142,350 $4,883 $425,244 
United KingdomUnited Kingdom28,767 — 13,327 — — 42,094 United Kingdom13,036 — 11,283 — — 24,319 
CanadaCanada12,343 — 926 — — 13,269 Canada11,023 — 1,424 — — 12,447 
IrelandIreland4,648 — 2,570 10,478 — 17,696 Ireland4,010 — 1,963 9,416 — 15,389 
LuxembourgLuxembourg— — 4,160 4,160 
OtherOther— — 126 — — 126 Other— — 111 — — 111 
Total revenuesTotal revenues$123,018 $124,768 $85,759 $147,412 $4,365 $485,322 Total revenues$124,184 $113,194 $83,483 $155,926 $4,883 $481,670 
The following tables provide additional information pertaining to our revenues disaggregated by major product line and primary geographic market based on the location of the use of the products or services for each of the Company’s business segments for the ninesix months ended SeptemberJune 30, 20222023 and 2021:2022:
Private
Banks
Investment
Advisors
Institutional
Investors
Investment
Managers
Investments
In New
Businesses
TotalPrivate
Banks
Investment
Advisors
Institutional
Investors
Investment
Managers
Investments
In New
Businesses
Total
Major Product Lines:Major Product Lines:For the Nine Months Ended September 30, 2022Major Product Lines:For the Six Months Ended June 30, 2023
Investment management fees from pooled investment productsInvestment management fees from pooled investment products$95,113 $203,171 $42,494 $288 $1,136 $342,202 Investment management fees from pooled investment products$64,313 $121,708 $24,437 $230 $690 $211,378 
Investment management fees from investment management agreementsInvestment management fees from investment management agreements1,504 122,321 192,559 — 12,191 328,575 Investment management fees from investment management agreements1,310 83,825 115,562 — 8,242 208,939 
Investment operations feesInvestment operations fees1,040 — — 434,302 — 435,342 Investment operations fees683 — — 299,907 — 300,590 
Investment processing fees - PaaSInvestment processing fees - PaaS170,651 — — — — 170,651 Investment processing fees - PaaS114,298 2,296 280 75 20 116,969 
Investment processing fees - SaaSInvestment processing fees - SaaS89,259 — 8,781 11,532 — 109,572 Investment processing fees - SaaS55,398 — 5,441 8,417 — 69,256 
Professional services fees (1)(2)Professional services fees (1)(2)100,020 — — 1,822 — 101,842 Professional services fees (1)(2)18,675 — — 2,244 — 20,919 
Account fees and otherAccount fees and other2,805 16,497 4,748 20,898 1,315 46,263 Account fees and other2,025 8,289 3,715 15,152 944 30,125 
Total revenuesTotal revenues$460,392 $341,989 $248,582 $468,842 $14,642 $1,534,447 Total revenues$256,702 $216,118 $149,435 $326,025 $9,896 $958,176 
Primary Geographic Markets:Primary Geographic Markets:Primary Geographic Markets:
United StatesUnited States$244,472 $341,989 $204,836 $428,303 $14,642 $1,234,242 United States$171,452 $216,118 $125,341 $296,805 $9,896 $819,612 
United KingdomUnited Kingdom171,042 — 33,761 — — 204,803 United Kingdom55,830 — 17,779 — — 73,609 
CanadaCanada33,318 — 4,023 — — 37,341 Canada20,238 — 2,816 — — 23,054 
IrelandIreland11,560 — 5,700 28,818 — 46,078 Ireland9,182 — 3,499 18,003 — 30,684 
LuxembourgLuxembourg— — — 11,721 — 11,721 Luxembourg— — — 11,217 — 11,217 
Other— — 262 — — 262 
Total revenuesTotal revenues$460,392 $341,989 $248,582 $468,842 $14,642 $1,534,447 Total revenues$256,702 $216,118 $149,435 $326,025 $9,896 $958,176 




2524


(1)(2) Professional services fees of the Private Banks segment includes a one-time early contractual buyout fee of $10,457 recorded during during the three months ended June 30, 2023 from an investment processing client acquired by an existing client.
Private
Banks
Investment
Advisors
Institutional
Investors
Investment
Managers
Investments
In New
Businesses
Total
Major Product Lines:For the Six Months Ended June 30, 2022
Investment management fees from pooled investment products$65,111 $139,483 $29,566 $207 $769 $235,136 
Investment management fees from investment management agreements871 82,406 131,672 — 8,199 223,148 
Investment operations fees704 — — 290,121 — 290,825 
Investment processing fees - PaaS112,833 — — — — 112,833 
Investment processing fees - SaaS59,404 — 6,131 7,569 — 73,104 
Professional services fees (3)96,825 — — 1,024 — 97,849 
Account fees and other1,984 10,535 2,953 13,906 840 30,218 
Total revenues$337,732 $232,424 $170,322 $312,827 $9,808 $1,063,113 
Primary Geographic Markets:
United States$177,001 $232,424 $139,265 $286,375 $9,808 $844,873 
United Kingdom129,699 — 24,032 — — 153,731 
Canada22,823 — 2,666 — — 25,489 
Ireland8,209 — 4,130 19,238 — 31,577 
Luxembourg— — 7,214 7,214 
Other— — 229 — — 229 
Total revenues$337,732 $232,424 $170,322 $312,827 $9,808 $1,063,113 
(3) Professional services fees of the Private Banks segment includes one-time early termination fees of $88,000 related to a contractual agreement with a significant client of the Company. In accordance with Accounting Standards Codification 606, the entire amount of the fees received were recorded during the three months ended March 31, 2022 as there were no future performance obligations of the Company related to the agreement upon termination.
Private
Banks
Investment
Advisors
Institutional
Investors
Investment
Managers
Investments
In New
Businesses
Total
Major Product Lines:For the Nine Months Ended September 30, 2021
Investment management fees from pooled investment products$100,484 $224,816 $41,365 $105 $993 $367,763 
Investment management fees from investment management agreements1,681 114,747 213,249 — 10,811 340,488 
Investment operations fees1,134 — — 394,401 — 395,535 
Investment processing fees - PaaS160,813 — — — — 160,813 
Investment processing fees - SaaS84,831 — — 11,409 — 96,240 
Professional services fees12,509 — — 2,885 — 15,394 
Account fees and other2,850 17,895 1,343 17,839 499 40,426 
Total revenues$364,302 $357,458 $255,957 $426,639 $12,303 $1,416,659 
Primary Geographic Markets:
United States$231,203 $357,458 $203,322 $396,598 $12,303 $1,200,884 
United Kingdom83,514 — 41,091 — — 124,605 
Canada35,977 — 3,426 — — 39,403 
Ireland13,608 — 7,735 30,041 — 51,384 
Other— — 383 — — 383 
Total revenues$364,302 $357,458 $255,957 $426,639 $12,303 $1,416,659 
Investment management fees from pooled investment products - Revenues associated with clients' assets invested in Company-sponsored pooled investment products. Contractual fees are stated as a percentage of the market value of assets under management and collected on a monthly basis. Revenues are recognized in Asset management, administration and distribution fees on the accompanying Consolidated Statements of Operations.
Investment management fees from investment management agreements - Revenues based on assets of clients of the Institutional Investors segment primarily invested in Company-sponsored products. Each client is charged an investment management fee that is stated as a percentage of the market value of all assets under management. The client is billed directly on a quarterly basis. Revenues are recognized in Asset management, administration and distribution fees on the accompanying Consolidated Statements of Operations.
Revenues associated with the separately managed account program offered through registered investment advisors located throughout the United States. The contractual fee is stated as a percentage of the market value of all assets invested in the separately managed account and collected on a quarterly basis. Revenues are recognized in Asset management, administration and distribution fees on the accompanying Consolidated Statements of Operations.
Investment operations fees - Revenues earned from accounting and administrative services, distribution support services and regulatory and compliance services to investment management firms and family offices. The Company contracts directly with the investment management firm or family office. The contractual fees are stated as a percentage of net assets under administration and billed when asset valuations are finalized. Revenues are recognized in Asset management, administration and distribution fees on the accompanying Consolidated Statements of Operations.
Investment processing fees - Platform as a Service - Revenues associated with clients that outsource their entire investment operation and back-office processing functions. Through the use of the Company's proprietary platforms, the Company assumes all back-office investment processing services including investment processing, custody and safekeeping of assets, income collections, securities settlement and other related trust activities. The contractual fee is




25


based on a monthly fee plus additional fees determined on a per-account or per-transaction basis. Contractual fees can also be stated as a percentage of the value of assets processed on the Company's platforms each month as long as the




26


fee is in excess of a monthly contractual minimum. The client is billed directly on a monthly basis. Revenues are recognized in Information processing and software servicing fees on the accompanying Consolidated Statements of Operations.
Investment processing fees - Software as a Service - Revenues associated with clients of the Private Banks segment that outsource investment processing technologyfor application software and computer processing by accessing the Company's proprietary software and data center remotely butservices. Clients retain responsibility for all investment operations, client administration and other back-office trust operations. The contractual fee is based on a monthly fee plus additional fees determined on a per-account or per-transaction basis. The client is billed directly on a monthly basis.
Revenues associated with portfolio intelligenceclients of the Investment Managers segment processed on the Archway PlatformSM are fees for hosted technology services to family offices and workflow solutions offeredfinancial institutions. The Archway Platform is an integrated technology platform used for investment, operations, accounting and client reporting by these institutions. The contractual fee is based on a monthly subscription fee to access the Archway Platform along with additional fees on a per transaction basis.
Revenues associated with clients of the Institutional Investors segment processed on the SEI NovusSM portfolio intelligence tool are fees for data management, performance measurement, reporting, and revenues associated with technology and outsourced services that support the accounting, investment management, and reporting functions for family offices and their service providers offered to clients of the Investment Managers segment.risk analytics. The contractual fee is primarily based on an annuala fixed fee to access SEI Novus and includes fees for software licensesintegration of historical fund data and data management services. The client is billed in advance with various billing terms. Revenue recorded in advance of the performance of services is deferred and recognized when earned. Revenuescustom reporting.
All revenues from investment processing fees are recognized in Information processing and software servicing fees on the accompanying Consolidated Statements of Operations.
Professional services fees - Revenues associated with the business services migration for investment processing clients of the Private Banks segment and investment operations clients of the Investment Managers segment. In addition, Professional services include other services such as business transformation consulting. Typically fees are stated as a contractual fixed fee. The client is billed directly and fees are collected according to the terms of the agreement.
Account fees and other - Revenues associated with custody account servicing, account terminations, reimbursements received for out-of-pocket expenses, and other fees for the provision of ancillary services.

Note 14.    Voluntary Separation ProgramSubsequent Events
TheOn July 13, 2023, the Company initiated a Voluntary Separation Program (VSP) to long-tenured employees which was finalized in July 2022. The VSP was offered to long-tenured employees as part ofannounced that SEI Investments (Europe) Limited (SIEL), its commitment to professional development and expanded responsibilities for current and new employees by increasing advancement opportunities.
The VSP was made available to employeeswholly-owned operating subsidiary in the United States who metKingdom, has entered into an option agreement to acquire the long-term tenure requirementsoutstanding equity of XPS Pensions (Nexus) Limited, principal employer and includesscheme funder of the National Pensions Trust (NPT), from its parent company, XPS Pensions Group PLC (XPS).
The total cash consideration payable to XPS for Nexus is up to £42,500, comprised of a severance package£35,000 initial consideration paid at closing and deferred consideration of up to £7,500 that may be earned over two years after the continuationclosing, subject to the achievement of certain benefits based upon years of service.post-closing performance measurements. The severance package also includes allowances relatedtransaction is expected to the vesting of certain stock option awards during the remainder of 2022close before year end, subject to applicable regulatory approval and the period in which the employee may exercise vested stock options after the termination of employment. These allowances are considered modifications to the Company's equity compensation plans.other customary closing conditions.
The majority of the accepted employees are scheduled to finish their employment during the first quarter 2023. All employees accepted into the program are scheduled to finish their employment before the end of 2023. The expected departure dates for participating employees may be adjusted based on management’s determination of how best to ensure a smooth and successful transition of responsibilities. In accordance with accounting guidance, the Company is required to recognize all costs related to termination salary and benefits under the VSP in the period in which the participating employees are irrevocably accepted into the program and the amount is reasonably estimated. As a result, the Company recognized $56,996 in net personnel costs associated with the VSP during the three months ended September 30, 2022. These personnel costs include stock-based compensation expense from modifications to the Company's equity compensation plans related to the vesting of stock options awarded to employees participating in the VSP net of options forfeited (See Note 7).






2726


Item 2.    Management’s Discussion and Analysis of Financial Condition and Results of Operations.
(In thousands, except asset balances and per share data)
This discussion reviews and analyzes the consolidated financial condition, the consolidated results of operations and other key factors that may affect future performance. This discussion should be read in conjunction with the Consolidated Financial Statements, the Notes to the Consolidated Financial Statements and the Annual Report on Form 10-K for the year ended December 31, 2021.2022.

Overview
Consolidated Summary
SEI is a leading global provider of technology-driven wealthdelivers technology and investment solutions that connect the financial services industry. With capabilities across investment processing, operations, and asset management, solutions. We deliver comprehensive platforms, servicesSEI works with corporations, financial institutions and infrastructure–encompassing technology, operational,professionals, and investment management services–ultra-high-net-worth families to help wealth managers, financial advisors, investment managers, family offices, institutionaldrive growth, make confident decisions, and private investors create and manage wealth.protect futures. Investment processing fees are earned as either monthly fees for contracted services or as a percentage of the market value of our clients' assets processed on our platforms. Investment operations and investment management fees are earned as a percentage of assets under management, administration or advised assets. As of SeptemberJune 30, 2022,2023, through our subsidiaries and partnerships in which we have a significant interest, we manage, advise or administer $1.2$1.3 trillion in hedge, private equity, mutual fund and pooled or separately managed assets, including $378.2 billion in assets under management and $785.4 billion in client assets under administration. Our affiliate, LSV Asset Management (LSV), manages $75.4 billion of assets which are included as assets under management.assets.
Condensed Consolidated Statements of Operations for the three and ninesix months ended SeptemberJune 30, 20222023 and 20212022 were:
Three Months Ended September 30,Percent Change*Nine Months Ended September 30,Percent Change* Three Months Ended June 30,Percent Change*Six Months Ended June 30,Percent Change*
2022202120222021 2023202220232022
RevenuesRevenues$471,334 $485,322 (3)%$1,534,447 $1,416,659 8%Revenues$489,057 $481,670 2%$958,176 $1,063,113 (10)%
ExpensesExpenses420,288 344,197 22%1,152,742 1,006,676 15%Expenses376,456 365,810 3%743,808 732,454 2%
Income from operationsIncome from operations51,046 141,125 (64)%381,705 409,983 (7)%Income from operations112,601 115,860 (3)%214,368 330,659 (35)%
Net (loss) gain from investments(1,406)(575)NM(4,515)134 NM
Net gain (loss) from investmentsNet gain (loss) from investments515 (2,620)NM1,259 (3,109)NM
Interest income, net of interest expenseInterest income, net of interest expense3,819 791 383%6,059 2,361 157%Interest income, net of interest expense9,411 1,642 473%18,048 2,240 706%
Equity in earnings from unconsolidated affiliateEquity in earnings from unconsolidated affiliate26,654 35,005 (24)%88,926 103,420 (14)%Equity in earnings from unconsolidated affiliate32,711 29,813 10%61,590 62,272 (1)%
Income before income taxesIncome before income taxes80,113 176,346 (55)%472,175 515,898 (8)%Income before income taxes155,238 144,695 7%295,265 392,062 (25)%
Income taxesIncome taxes18,454 38,301 (52)%108,932 114,605 (5)%Income taxes36,387 33,419 9%69,399 90,478 (23)%
Net incomeNet income61,659 138,045 (55)%363,243 401,293 (9)%Net income118,851 111,276 7%225,866 301,584 (25)%
Diluted earnings per common shareDiluted earnings per common share$0.45 $0.97 (54)%$2.63 $2.79 (6)%Diluted earnings per common share$0.89 $0.81 10%$1.68 $2.17 (23)%
* Variances noted "NM" indicate the percent change is not meaningful.
The following items had a significant impact on our financial results for the three and ninesix months ended SeptemberJune 30, 20222023 and 2021:2022:
Revenue growth in the first nine months of 2022 was primarily driven by higherfrom Information processing and software servicing fees decreased in the first six months of 2023 primarily from one-time early termination fees of $88.0 million from a significant client of the Private Banks segment recorded during the first quarter 2022. A one-time early contractual buyout fee of $10.5 million recorded during second-quarter 2023 from an investment processing client of the Private Banks segment acquired by an existing client partially offset the decline in revenues.
Revenue from Asset management, administration and distribution fees decreased in the first six months of 2023 primarily from lower assets under management in equity and fixed income programs from market depreciation during 2022 and newnegative cash flows from SEI fund programs due to client conversions.losses in the Investment Advisors and Institutional Investors segments. The improvement in market conditions and positive cash flows into separately managed account programs and Strategist programs of the Investment Advisors segment during 2023 partially offset the decline in revenues. Average assets under management in equity and fixed income programs, excluding LSV, decreased $17.4 billion, or 9%, to $168.4 billion in the first six months of 2023 as compared to $185.8 billion during the first six months of 2022.
Revenue from Asset management, administration and distribution fees increased slightlyfrom existing alternative investment clients of the Investment Managers segment due to new products and additional services. The decrease in the first nine months of 2022 from higher average assets under administration from market appreciation during 2021 and positive cash flows from new and existing clients despite the significant decline in market conditions in 2022, most notably in the third quarter. Average assets under administration decreased $69.1 billion, or 8%, to $786.6 billion in the third quarter of 2022 as compared to $855.7 billion during the third quarter of 2021. Average assets under administration increased $14.0 billion, or 2%, to $859.2 billion in the first nine months of 2022 as compared to $845.2 billion during the first nine months of 2021.
Revenue from Asset management, administration and distribution fees was negatively impacted from thereflect a loss of a significant client in 2022 which was not charged asset-based fees.
Earnings from LSV decreased to $61.6 million in the first six months of 2023 as compared to $62.3 million in the Investment Advisors segment. Averagefirst six months of 2022 due to a lower level of assets under management excludingby LSV increased $21.1 billion, or 7%, to $312.4 billion in the first nine months of 2022 as compared to $291.3 billion during the first nine months of 2021.from negative cash flows from




2827


Revenues from our acquisitions of SEI Novus and Atlas Master Trust were $8.7 million and $3.7 million, respectively, during the first nine months of 2022. SEI Novus and Atlas Master Trust were acquired during the fourth quarter of 2021 and are reported in the Institutional Investors segment (See Note 12 to the Consolidated Financial Statements).
Earnings from LSV decreased to $88.9 million in the first nine months of 2022 as compared to $103.4 million in the first nine months of 2021 due to negative cash flows from existing clients, client losses and market depreciation during 2022. Higher performance fees and client losses.market appreciation during second quarter 2023 partially offset the decline in earnings from LSV.
Operating expenses also increased from higher personnel and consulting costs due to business growth primarily in our Investment Managers segment and competitive labor markets. Operational expenses also increased due to personnel costs and investments in compliance infrastructure to meet new regulatory requirements.Therequirements. The increase was partially offset by lower direct costs related to asset management revenues and lower amortization expense.
We initiated a Voluntary Separation Program (VSP) to long-tenured employees as part of our commitment to professionalCapitalized software development and expanded responsibilities for current and new employees by increasing advancement opportunities. We recognized one-time costs of $57.0 million during the third quarter 2022 from the program. These costs are primarily included in Compensation, benefits and other personnel costs on the accompanying Consolidated Statements of Operations (See Note 14 to the Consolidated Financial Statements).
The Institutional Investors segment includes personnel, professional fees, amortization and other costs related to SEI Novus and Atlas Master Trust. These expenses are primarily included in Compensation, benefits and other personnel costs, Consulting, outsourcing and professional fees, and Amortization on the accompanying Consolidated Statements of Operations.
We capitalized $19.5were $18.0 million in the first ninesix months of 20222023, of which $9.4 million was for the SEI Wealth Platform as comparedcontinued enhancements to $19.4SWP. We also capitalized $8.6 million of software development costs in the first ninesix months of 2021. 2023 for a new platform for the Investment Managers segment.
Amortization expense related to SWP was $29.7$12.5 million duringin the first ninesix months of 20222023 as compared to $35.8$23.9 million duringin the first ninesix months of 2021.2022. The decline in amortization expense was due to the amortization period of the initial development costs related to SWP which ended duringin second-quarter 2022.
Interest and dividend income was $18.3 million in the second quarter 2022 (Seefirst six months of 2023 as compared to $2.7 million in the caption "Capitalized software development costs" laterfirst six months of 2022. The increase in this discussion for more information).interest and dividend income was due to an overall increase in interest rates.
We continued the stock repurchase program during 20222023 and purchased 4.62.7 million shares for $258.8$155.9 million in the ninesix month period.
On July 13, 2023, our wholly-owned operating subsidiary in the United Kingdom entered into an option agreement to acquire XPS Pensions (Nexus) Limited, principal employer and scheme funder of the National Pensions Trust (NPT). The total cash consideration payable for Nexus is up to £42.5 million, comprised of a £35.0 million initial consideration paid at closing and deferred consideration of up to £7.5 million that may be earned over two years after the closing, subject to the achievement of certain post-closing performance measurements. The transaction is expected to close before year end, subject to applicable regulatory approval (See Note 14 to the Notes to Consolidated Financial Statements).





2928


Ending Asset Balances
(In millions)
As of September 30,Percent Change As of June 30,Percent Change
20222021 20232022
Private Banks:Private Banks:Private Banks:
Equity and fixed-income programsEquity and fixed-income programs$20,131 $25,618 (21)%Equity and fixed-income programs$24,091 $22,277 8%
Collective trust fund programsCollective trust fund programs17%Collective trust fund programs—%
Liquidity fundsLiquidity funds3,778 3,988 (5)%Liquidity funds3,433 3,666 (6)%
Total assets under managementTotal assets under management$23,916 $29,612 (19)%Total assets under management$27,531 $25,950 6%
Client assets under administrationClient assets under administration4,161 4,675 (11)%Client assets under administration4,154 3,923 6%
Total assetsTotal assets$28,077 $34,287 (18)%Total assets$31,685 $29,873 6%
Investment Advisors:Investment Advisors:Investment Advisors:
Equity and fixed-income programsEquity and fixed-income programs$62,579 $78,560 (20)%Equity and fixed-income programs$69,439 $65,783 6%
Liquidity fundsLiquidity funds5,200 3,477 50%Liquidity funds4,968 8,292 (40)%
Total Platform assets under managementTotal Platform assets under management$67,779 $82,037 (17)%Total Platform assets under management$74,407 $74,075 —%
Platform-only assetsPlatform-only assets12,609 13,728 (8)%Platform-only assets16,103 12,642 27%
Total Platform assetsTotal Platform assets$80,388 $95,765 (16)%Total Platform assets$90,510 $86,717 4%
Institutional Investors:Institutional Investors:Institutional Investors:
Equity and fixed-income programsEquity and fixed-income programs$69,621 $89,441 (22)%Equity and fixed-income programs$75,854 $75,506 —%
Collective trust fund programsCollective trust fund programs20%Collective trust fund programs(20)%
Liquidity fundsLiquidity funds1,640 2,599 (37)%Liquidity funds1,353 1,654 (18)%
Total assets under managementTotal assets under management$71,267 $92,045 (23)%Total assets under management$77,211 $77,165 —%
Client assets under advisementClient assets under advisement4,204 4,698 (11)%Client assets under advisement4,368 4,218 4%
Total assetsTotal assets$75,471 $96,743 (22)%Total assets$81,579 $81,383 —%
Investment Managers:Investment Managers:Investment Managers:
Collective trust fund programs (A)Collective trust fund programs (A)$137,538 $87,488 57%Collective trust fund programs (A)$149,779 $142,035 5%
Liquidity fundsLiquidity funds248 568 (56)%Liquidity funds249 271 (8)%
Total assets under managementTotal assets under management$137,786 $88,056 56%Total assets under management$150,028 $142,306 5%
Client assets under administrationClient assets under administration781,246 861,605 (9)%Client assets under administration873,570 885,096 (1)%
Total assetsTotal assets$919,032 $949,661 (3)%Total assets$1,023,598 $1,027,402 —%
Investments in New Businesses:Investments in New Businesses:Investments in New Businesses:
Equity and fixed-income programsEquity and fixed-income programs$1,813 $1,964 (8)%Equity and fixed-income programs$2,104 $1,903 11%
Liquidity fundsLiquidity funds221 202 9%Liquidity funds217 242 (10)%
Total assets under managementTotal assets under management$2,034 $2,166 (6)%Total assets under management$2,321 $2,145 8%
Client assets under advisementClient assets under advisement1,026 1,378 (26)%Client assets under advisement1,098 1,076 2%
Total assetsTotal assets$3,060 $3,544 (14)%Total assets$3,419 $3,221 6%
LSV:LSV:LSV:
Equity and fixed-income programs (B)Equity and fixed-income programs (B)$75,380 $97,604 (23)%Equity and fixed-income programs (B)$86,469 $81,940 6%




3029


Total:Total:Total:
Equity and fixed-income programs (C)Equity and fixed-income programs (C)$229,524 $293,187 (22)%Equity and fixed-income programs (C)$257,957 $247,409 4%
Collective trust fund programsCollective trust fund programs137,551 87,499 57%Collective trust fund programs149,790 142,047 5%
Liquidity fundsLiquidity funds11,087 10,834 2%Liquidity funds10,220 14,125 (28)%
Total assets under managementTotal assets under management$378,162 $391,520 (3)%Total assets under management$417,967 $403,581 4%
Client assets under advisementClient assets under advisement5,230 6,076 (14)%Client assets under advisement5,466 5,294 3%
Client assets under administration (D)Client assets under administration (D)785,407 866,280 (9)%Client assets under administration (D)877,724 889,019 (1)%
Platform-only assetsPlatform-only assets12,609 13,728 (8)%Platform-only assets16,103 12,642 27%
Total assetsTotal assets$1,181,408 $1,277,604 (8)%Total assets$1,317,260 $1,310,536 1%
(A)Collective trust fund program assets are included in assets under management since SEI is the trustee. Fees earned on this product are less than fees earned on customized asset management programs.
(B)    Equity and fixed-income programs include $1.7$2.0 billion of assets managed by LSV in which fees are based solely on performance and are not calculated as an asset-based fee (as of SeptemberJune 30, 2022)2023).
(C)    Equity and fixed-income programs include $6.2 billion of assets invested in various asset allocation funds (as of Septemberat June 30, 2022).2023.
(D)    In addition to the assets presented, SEI also administers an additional $12.5$11.7 billion in Funds of Funds assets on which SEI does not earn an administration fee (as of SeptemberJune 30, 2022)2023).





30


Average Asset Balances
(In millions)
 Three Months Ended June 30,Percent ChangeSix Months Ended June 30,Percent Change
 2023202220232022
Private Banks:
Equity and fixed-income programs$23,748 $23,713 —%$23,662 $24,675 (4)%
Collective trust fund programs—%—%
Liquidity funds3,500 3,795 (8)%3,377 4,099 (18)%
Total assets under management$27,255 $27,515 (1)%$27,046 $28,781 (6)%
Client assets under administration4,282 4,163 3%4,299 4,332 (1)%
Total assets$31,537 $31,678 —%$31,345 $33,113 (5)%
Investment Advisors:
Equity and fixed-income programs$68,371 $70,436 (3)%$67,975 $74,006 (8)%
Liquidity funds4,808 7,070 (32)%4,902 6,111 (20)%
Total Platform assets under management$73,179 $77,506 (6)%$72,877 $80,117 (9)%
Platform-only assets15,548 13,142 18%15,180 13,560 12%
Total Platform assets$88,727 $90,648 (2)%$88,057 $93,677 (6)%
Institutional Investors:
Equity and fixed-income programs$74,865 $80,971 (8)%$74,759 $85,111 (12)%
Collective trust fund programs(20)%—%
Liquidity funds1,537 2,097 (27)%1,626 2,160 (25)%
Total assets under management$76,406 $83,073 (8)%$76,390 $87,276 (12)%
Client assets under advisement4,583 3,987 15%4,507 4,438 2%
Total assets$80,989 $87,060 (7)%$80,897 $91,714 (12)%
Investment Managers:
Collective trust fund programs (A)$147,543 $131,435 12%$146,229 $109,034 34%
Liquidity funds286 285 —%302 359 (16)%
Total assets under management$147,829 $131,720 12%$146,531 $109,393 34%
Client assets under administration859,296 893,361 (4)%847,853 891,108 (5)%
Total assets$1,007,125 $1,025,081 (2)%$994,384 $1,000,501 (1)%
Investments in New Businesses:
Equity and fixed-income programs$2,057 $2,016 2%$2,024 $2,021 —%
Liquidity funds199 262 (24)%206 274 (25)%
Total assets under management$2,256 $2,278 (1)%$2,230 $2,295 (3)%
Client assets under advisement1,075 1,165 (8)%1,087 1,281 (15)%
Total assets$3,331 $3,443 (3)%$3,317 $3,576 (7)%
LSV:
Equity and fixed-income programs (B)$84,492 $87,818 (4)%$85,740 $92,134 (7)%





31


Average Asset Balances
(In millions)
 Three Months Ended September 30,Percent ChangeNine Months Ended September 30,Percent Change
 2022202120222021
Private Banks:
Equity and fixed-income programs$22,115 $26,232 (16)%$23,822 $25,809 (8)%
Collective trust fund programs17%17%
Liquidity funds3,742 3,916 (4)%3,980 3,875 3%
Total assets under management$25,864 $30,154 (14)%$27,809 $29,690 (6)%
Client assets under administration4,026 4,476 (10)%4,230 4,399 (4)%
Total assets$29,890 $34,630 (14)%$32,039 $34,089 (6)%
Investment Advisors:
Equity and fixed-income programs$67,464 $79,602 (15)%$71,825 $76,560 (6)%
Liquidity funds5,380 3,403 58%5,867 3,464 69%
Total Platform assets under management$72,844 $83,005 (12)%$77,692 $80,024 (3)%
Platform-only assets13,271 13,863 (4)%13,464 13,120 3%
Total Platform assets$86,115 $96,868 (11)%$91,156 $93,144 (2)%
Institutional Investors:
Equity and fixed-income programs$74,859 $91,965 (19)%$81,693 $92,257 (11)%
Collective trust fund programs20%56 (91)%
Liquidity funds1,717 2,742 (37)%2,012 2,681 (25)%
Total assets under management$76,582 $94,712 (19)%$83,710 $94,994 (12)%
Client assets under advisement4,194 4,658 (10)%4,357 4,440 (2)%
Total assets$80,776 $99,370 (19)%$88,067 $99,434 (11)%
Investment Managers:
Collective trust fund programs (A)$143,817 $89,441 61%$120,628 $84,010 44%
Liquidity funds250 532 (53)%322 497 (35)%
Total assets under management$144,067 $89,973 60%$120,950 $84,507 43%
Client assets under administration782,559 851,183 (8)%854,925 840,774 2%
Total assets$926,626 $941,156 (2)%$975,875 $925,281 5%
Investments in New Businesses:
Equity and fixed-income programs$1,939 $1,958 (1)%$1,993 $1,857 7%
Liquidity funds231 205 13%260 203 28%
Total assets under management$2,170 $2,163 —%$2,253 $2,060 9%
Client assets under advisement1,126 1,423 (21)%1,229 1,385 (11)%
Total assets$3,296 $3,586 (8)%$3,482 $3,445 1%
LSV:
Equity and fixed-income programs (B)$81,241 $99,924 (19)%$88,503 $100,328 (12)%





32


Total:Total:Total:
Equity and fixed-income programs (C)Equity and fixed-income programs (C)$247,618 $299,681 (17)%$267,836 $296,811 (10)%Equity and fixed-income programs (C)$253,533 $264,954 (4)%$254,160 $277,947 (9)%
Collective trust fund programsCollective trust fund programs143,830 89,452 61%120,640 84,073 43%Collective trust fund programs147,554 131,447 12%146,241 109,046 34%
Liquidity fundsLiquidity funds11,320 10,798 5%12,441 10,720 16%Liquidity funds10,330 13,509 (24)%10,413 13,003 (20)%
Total assets under managementTotal assets under management$402,768 $399,931 1%$400,917 $391,604 2%Total assets under management$411,417 $409,910 —%$410,814 $399,996 3%
Client assets under advisementClient assets under advisement5,320 6,081 (13)%5,586 5,825 (4)%Client assets under advisement5,658 5,152 10%5,594 5,719 (2)%
Client assets under administration (D)Client assets under administration (D)786,585 855,659 (8)%859,155 845,173 2%Client assets under administration (D)863,578 897,524 (4)%852,152 895,440 (5)%
Platform-only assetsPlatform-only assets13,271 13,863 (4)%13,464 13,120 3%Platform-only assets15,548 13,142 18%15,180 13,560 12%
Total assetsTotal assets$1,207,944 $1,275,534 (5)%$1,279,122 $1,255,722 2%Total assets$1,296,201 $1,325,728 (2)%$1,283,740 $1,314,715 (2)%
(A)    Collective trust fund program average assets are included in assets under management since SEI is the trustee. Fees earned on this product are less than fees earned on customized asset management programs.
(B)    Equity and fixed-income programs include assets managed by LSV in which fees are based solely on performance and are not calculated as an asset-based fee. The average value of these assets for the three months ended SeptemberJune 30, 20222023 was $1.8$2.0 billion.
(C)    Equity and fixed-income programs include $6.3 billion of average assets invested in various asset allocation funds for the three months ended SeptemberJune 30, 2022.2023.
(D)    In addition to the assets presented, SEI also administers an additional $12.7$11.9 billion of average assets in Funds of Funds assets for the three months ended SeptemberJune 30, 20222023 on which SEI does not earn an administration fee.

In the preceding tables, assets under management are total assets of our clients or their customers invested in equity and fixed-income investment programs, collective trust fund programs, and liquidity funds for which we provide asset management services through our subsidiaries and partnerships in which we have a significant interest. Assets under advisement include assets for which we provide advisory services through a subsidiary to the accounts but do not manage the underlying assets. Assets under administration include total assets of our clients or their customers for which we provide administrative services, including client fund balances for which we provide administration and/or distribution services through our subsidiaries and partnerships in which we have a significant interest. Platform-only assets include total assets of our clients or their customers which are not invested in any SEI-sponsored investment products. The assets presented in the preceding tables do not include assets processed on SWP and are not included in the accompanying Consolidated Balance Sheets because we do not own them.





3332


Business Segments
Revenues, Expenses and Operating Profit (Loss) for our business segments for the three and ninesix months ended SeptemberJune 30, 20222023 compared to the three and ninesix months ended SeptemberJune 30, 20212022 were as follows:
Three Months Ended September 30,Percent
Change
Nine Months Ended September 30,Percent
Change
Three Months Ended June 30,Percent
Change
Six Months Ended June 30,Percent
Change
2022202120222021 2023202220232022
Private Banks:Private Banks:Private Banks:
RevenuesRevenues$122,660 $123,018 —%$460,392 $364,302 26%Revenues$134,099 $124,184 8%$256,702 $337,732 (24)%
ExpensesExpenses116,661 116,679 —%359,676 345,057 4%Expenses116,061 121,060 (4)%230,337 243,015 (5)%
Operating ProfitOperating Profit$5,999 $6,339 (5)%$100,716 $19,245 NMOperating Profit$18,038 $3,124 NM$26,365 $94,717 (72)%
Operating MarginOperating Margin%%22 %%Operating Margin13 %%10 %28 %
Investment Advisors:Investment Advisors:Investment Advisors:
RevenuesRevenues$109,565 $124,768 (12)%$341,989 $357,458 (4)%Revenues$109,580 $113,194 (3)%$216,118 $232,424 (7)%
ExpensesExpenses61,150 62,107 (2)%189,045 176,267 7%Expenses64,178 63,375 1%127,724 127,895 —%
Operating ProfitOperating Profit$48,415 $62,661 (23)%$152,944 $181,191 (16)%Operating Profit$45,402 $49,819 (9)%$88,394 $104,529 (15)%
Operating MarginOperating Margin44 %50 %45 %51 %Operating Margin41 %44 %41 %45 %
Institutional Investors:Institutional Investors:Institutional Investors:
RevenuesRevenues$78,260 $85,759 (9)%$248,582 $255,957 (3)%Revenues$75,145 $83,483 (10)%$149,435 $170,322 (12)%
ExpensesExpenses42,149 41,643 1%131,432 122,696 7%Expenses45,516 43,925 4%86,384 89,283 (3)%
Operating ProfitOperating Profit$36,111 $44,116 (18)%$117,150 $133,261 (12)%Operating Profit$29,629 $39,558 (25)%$63,051 $81,039 (22)%
Operating MarginOperating Margin46 %51 %47 %52 %Operating Margin39 %47 %42 %48 %
Investment Managers:Investment Managers:Investment Managers:
RevenuesRevenues$156,015 $147,412 6%$468,842 $426,639 10%Revenues$165,339 $155,926 6%$326,025 $312,827 4%
ExpensesExpenses100,876 89,594 13%300,520 257,609 17%Expenses107,761 100,807 7%213,627 199,644 7%
Operating ProfitOperating Profit$55,139 $57,818 (5)%$168,322 $169,030 —%Operating Profit$57,578 $55,119 4%$112,398 $113,183 (1)%
Operating MarginOperating Margin35 %39 %36 %40 %Operating Margin35 %35 %34 %36 %
Investments in New Businesses:Investments in New Businesses:Investments in New Businesses:
RevenuesRevenues$4,834 $4,365 11%$14,642 $12,303 19%Revenues$4,894 $4,883 —%$9,896 $9,808 1%
ExpensesExpenses9,915 12,820 (23)%34,709 39,855 (13)%Expenses10,571 12,844 (18)%22,215 24,794 (10)%
Operating LossOperating Loss$(5,081)$(8,455)NM$(20,067)$(27,552)NMOperating Loss$(5,677)$(7,961)NM$(12,319)$(14,986)NM
For additional information pertaining to our business segments, see Note 9 to the Consolidated Financial Statements.





3433


Private Banks
Three Months Ended September 30,Percent
Change
Nine Months Ended September 30,Percent
Change
Three Months Ended June 30,Percent
Change
Six Months Ended June 30,Percent
Change
2022202120222021 2023202220232022
Revenues:Revenues:Revenues:
Information processing and software servicing feesInformation processing and software servicing fees$93,580 $88,340 6%$367,820 $261,907 40%Information processing and software servicing fees$100,602 $93,203 8%$190,580 $274,240 (31)%
Asset management, administration & distribution feesAsset management, administration & distribution fees29,080 34,678 (16)%92,572 102,395 (10)%Asset management, administration & distribution fees33,497 30,981 8%66,122 63,492 4%
Total revenuesTotal revenues$122,660 $123,018 —%$460,392 $364,302 26%Total revenues$134,099 $124,184 8%$256,702 $337,732 (24)%
Revenues decreased slightlyincreased $9.9 million, or 8%, in the three month period and increased $96.1 million, or 26%, in the nine month period ended SeptemberJune 30, 20222023 and were primarily affected by:
EarlyOne-time early termination fees of $88.0$10.5 million recorded during the first quarter 2022 from a significantan investment processing client; and
Increased investment processing fees from new client conversions; and
Increased revenues from U.K. clients impacted by increased interest rates; partially offset by
The negative impact from foreign currency exchange rate fluctuations between the U.S. dollar and the British pound on our foreign operations;
Decreased investment managementA negative adjustment to fees from existing international clients due to market depreciation during 2022;an investment processing client which reduced their business processed through divestment; and
DecreasedLower investment processing fees from lost clientsthe recontacting of existing clients.
Revenues decreased $81.0 million, or 24%, in the six month period ended June 30, 2023 and market depreciation during 2022; andwere primarily affected by:
One-time early termination fees of $88.0 million from a TRUST 3000®significant investment processing client recorded induring the secondfirst quarter 2021.
Operating margins were 5% in the three month periods and increased to 22% compared to 5% in the nine month period. Operating income decreased slightly in the three month period and increased $81.5 million in the nine month period and was primarily affected by:
An increase in revenues; and
Decreased direct expenses associated with lower investment management fees from existing international clients; partially offset by
Increased personnel costs due to competitive labor markets;
Increased costs, mainly personnel and consulting costs, primarily related to maintenance, support and client migrations to SWP;2022;
The negative impact from foreign currency exchange rate fluctuations between the U.S. dollar and the British pound on our foreign operations;
A negative adjustment to fees from an investment processing client which reduced their business processed through divestment; and
Lower investment processing fees from the recontacting of existing clients; partially offset by
Increased investment processing fees from new client conversions;
Increased revenues from U.K. clients impacted by increased interest rates; and
One-time early termination fees of $10.5 million from an investment processing client recorded in second quarter 2023.
Operating margins increased to 13% compared to 3% in the three month period. Operating income increased by $14.9 million in the three month period and was primarily affected by:
An increase in revenues; and
Decreased amortization expense related to SWP; partially offset by
Increased personnel costs due to competitive labor markets; and
Increased costs, mainly personnel costs, primarily related to maintenance, support and client migrations to SWP.
Operating margins decreased to 10% compared to 28% in the six month period. Operating income decreased by $68.4 million, or 72%, in the six month period and was primarily affected by:
A decrease in revenues;
Increased personnel costs due to competitive labor markets; and
Increased costs, mainly personnel costs, primarily related to maintenance, support and client migrations to SWP; partially offset by
Decreased amortization expense related to SWP; and
Decreased amortization expense related to deferred sales commissions.




34



Investment Advisors
Three Months Ended September 30,Percent
Change
Nine Months Ended September 30,Percent
Change
Three Months Ended June 30,Percent
Change
Six Months Ended June 30,Percent
Change
2022202120222021 2023202220232022
Revenues:Revenues:Revenues:
Investment management fees-SEI fund programsInvestment management fees-SEI fund programs$63,688 $77,123 (17)%$203,171 $224,816 (10)%Investment management fees-SEI fund programs$61,103 $67,490 (9)%$121,708 $139,483 (13)%
Separately managed account feesSeparately managed account fees39,915 41,688 (4)%122,321 114,747 7%Separately managed account fees43,159 40,398 7%83,825 82,406 2%
Other feesOther fees5,962 5,957 —%16,497 17,895 (8)%Other fees5,318 5,306 —%10,585 10,535 —%
Total revenuesTotal revenues$109,565 $124,768 (12)%$341,989 $357,458 (4)%Total revenues$109,580 $113,194 (3)%$216,118 $232,424 (7)%
Revenues decreased $15.2$3.6 million, or 12%3%, in the three month period and decreased $15.5$16.3 million, or 4%7%, in the ninesix month period ended SeptemberJune 30, 20222023 and were primarily affected by:
Decreased investment management fees from SEI fund programs resulting from negative cash flows frommarket depreciation and client losses during 2022 along with a significant client loss during the third-quarter 2022 and the significant decline in market conditions during 2022;continued shift out of SEI fund programs into separately managed accounts; partially offset by
Increased fees from separately managed account program feesprograms and Strategist programs from positive cash flows.
Operating margin decreased to 41% compared to 44% in the three month period and decreased to 41% compared to 45% in the six month period. Operating income decreased $4.4 million, or 9%, in the three month period and decreased $16.1 million, or 15%, in the six month period and was primarily affected by:
A decrease in revenues;
Increased personnel costs; and
Increased direct expenses associated with investment management fees; partially offset by
Decreased direct expenses related to a significant client loss during the third quarter 2022;
Decreased amortization expense related to SWP; and
Decreased non-capitalized consulting costs.
Institutional Investors
Revenues decreased $8.3 million, or 10%, in the three month period and decreased $20.9 million, or 12%, in the six month period ended June 30, 2023 and were primarily affected by:
Decreased investment management fees from defined benefit client losses and market depreciation during 2022.
Operating margin decreased to 39% compared to 47% in the three month period and decreased to 42% compared to 48% in the six month period. Operating income decreased $9.9 million, or 25%, in the three month period and decreased $18.0 million, or 22%, in the six month period and was primarily affected by:
A decrease in revenues;
A one-time operational charge of $4.5 million related to a client reimbursement; partially offset by
Decreased direct expenses associated with investment management fees; and
Decreased professional fees.
Investment Managers
Revenues increased $9.4 million, or 6%, in the three month period and increased $13.2 million, or 4%, in the six month period ended June 30, 2023 and were primarily affected by:
Increased revenues from new products launched and additional services provided to our largest alternative fund clients; and
Positive cash flows into our Strategist programsalternative and traditional funds from new and existing clients; partially offset by
Client losses, fund closures and the impact of market appreciation occurringdepreciation during 2021.2022 to revenue from traditional fund clients.




35


Operating margin decreased to 44% compared to 50%remained at 35% in the three month period and decreased to 45%34% compared to 51%36% in the ninesix month period. Operating income decreased $14.2increased $2.5 million, or 23%4%, in the three month period and decreased $28.2 million,$800 thousand, or 16%1%, in the nine month period and was primarily affected by:
A decrease in revenues;
Increased direct expenses associated with increased assets into our separately managed account program; and
Increased personnel and technology costs as well as increased promotion costs; partially offset by
Decreased direct expenses related to a significant client loss during third-quarter 2022.
Institutional Investors
Revenues decreased $7.5 million, or 9%, in the three month period and decreased $7.4 million, or 3%, in the nine month period ended September 30, 2022 and were primarily affected by:
Decreased investment management fees from defined benefit client losses and the significant decline in market conditions during 2022; and
The negative impact from foreign currency exchange rate fluctuations between the U.S. dollar and the British pound on our foreign operations; partially offset by
Added revenues from the acquisitions of SEI Novus and Atlas Master Trust during the fourth quarter 2021.
Operating margin decreased to 46% compared to 51% in the three month period and decreased to 47% compared to 52% in the nine month period. Operating income decreased $8.0 million, or 18%, in the three month period and decreased $16.1 million, or 12%, in the nine month period and was primarily affected by:
A decrease in revenues;
Increased personnel, professional fees, amortization and other costs related to the acquisitions of SEI Novus and Atlas Master Trust; partially offset by
Decreased direct expenses associated with investment management fees.
Investment Managers
Revenues increased $8.6 million, or 6%, in the three month period and increased $42.2 million, or 10%, in the nine month period ended September 30, 2022 and were primarily affected by:
Higher valuations of existing client assets from market appreciation in 2021 which impacted revenues in early 2022; and
Positive cash flows into alternative, traditional and separately managed account offerings from new and existing clients; partially offset by
Client losses and fund closures.
Operating margin decreased to 35% compared to 39% in the three month period and decreased to 36% compared to 40% in the nine month period. Operating income decreased $2.7 million, or 5%, in the three month period and decreased slightly in the ninesix month period and was primarily affected by:
Increased personnel costs due to competitive labor markets; and
Increased costs associated with new business, primarily personnel expenses and third-party vendor costs; and
Increased non-capitalized investment spending, mainly consulting costs; partially offset by
An increase in revenues; and
Decreased non-capitalized investment spending, mainly consulting costs.

Other
Corporate overhead expenses
Corporate overhead expenses primarily consist of general and administrative expenses and other costs not directly attributable to a reportable business segment. Corporate overhead expenses were $89.5$32.4 million and $21.4$23.8 million in the three months ended SeptemberJune 30, 20222023 and 2021,2022, respectively, and $137.4$63.5 million and $65.2$47.8 million in the ninesix months ended SeptemberJune 30, 20222023 and 2021,2022, respectively. The increase in corporate overhead expenses in the three and ninesix month periods is primarily due to non-recurring consulting costs related to corporate strategic planning, target market review and other corporate analysis projects as well investments in upgrading and enhancing various technologies utilized by corporate overhead units. Additionally, personnel costs associated withincreased primarily to enhance and further build our compliance infrastructure, strategic development initiatives and the VSPimpact of $57.0 million (See Note 14 to the Consolidated Financial Statements). Corporate overhead expenses in the three and nine month periods also increased due to higher personnel costs, consulting and professional fees and severance costs unrelated to the VSP of $5.2 million.




36


inflation on wages.
Other income and expense
Other income and expense items on the accompanying Consolidated Statements of Operations consistsconsist of: 
Three Months Ended September 30,Nine Months Ended September 30, Three Months Ended June 30,Six Months Ended June 30,
2022202120222021 2023202220232022
Net (loss) gain from investments$(1,406)$(575)$(4,515)$134 
Net gain (loss) from investmentsNet gain (loss) from investments$515 $(2,620)$1,259 $(3,109)
Interest and dividend incomeInterest and dividend income3,962 892 6,663 2,715 Interest and dividend income9,550 1,853 18,328 2,701 
Interest expenseInterest expense(143)(101)(604)(354)Interest expense(139)(211)(280)(461)
Equity in earnings of unconsolidated affiliateEquity in earnings of unconsolidated affiliate26,654 35,005 88,926 103,420 Equity in earnings of unconsolidated affiliate32,711 29,813 61,590 62,272 
Total other income and expense items, netTotal other income and expense items, net$29,067 $35,221 $90,470 $105,915 Total other income and expense items, net$42,637 $28,835 $80,897 $61,403 
Net gain (loss) gain from investments
Net lossesgains from investments in the three and ninesix months ended SeptemberJune 30, 20222023 were primarily due to unrealized mark-to-market lossesgains recorded in current earnings associated with Company-sponsored mutual funds and LSV-sponsored investment funds from the significant decline in market conditions in 2022appreciation (See Note 5).
Interest and dividend income
Interest and dividend income is earned based upon the amount of cash that is invested daily. The increase in interest and dividend income in the three and ninesix months ended SeptemberJune 30, 20222023 was due to an overall increase in interest rates.
Equity in earnings of unconsolidated affiliate
Equity in earnings of unconsolidated affiliate reflects our ownership interest in LSV. As of SeptemberJune 30, 2022,2023, our total partnership interest in LSV was 38.6%. The table below presents the revenues and net income of LSV and the proportionate share in LSV's earnings.
Three Months Ended September 30,Percent ChangeNine Months Ended September 30,Percent ChangeThree Months Ended June 30,Percent ChangeSix Months Ended June 30,Percent Change
2022202120222021 2023202220232022
Revenues of LSVRevenues of LSV$91,588 $115,728 (21)%$299,852 $342,957 (13)%Revenues of LSV$108,836 $99,814 9%$207,028 $208,264 (1)%
Net income of LSVNet income of LSV69,013 90,365 (24)%229,997 266,805 (14)%Net income of LSV84,779 77,193 10%159,553 160,984 (1)%
SEI's proportionate share in earnings of LSVSEI's proportionate share in earnings of LSV$26,654 $35,005 (24)%$88,926 $103,420 (14)%SEI's proportionate share in earnings of LSV$32,711 $29,813 10%$61,590 $62,272 (1)%
The increase in earnings from LSV in the three months ended June 30, 2023 was primarily due to higher performance fees and market appreciation. Net negative cash flows from existing clients and client losses partially offset the increase in earnings from LSV. The decrease in earnings from LSV in the three and ninesix months ended SeptemberJune 30, 20222023 was primarily due to




36


negative cash flows from existing clients, client losses and market depreciation during 2022 and client losses.early 2023. Average assets under management by LSV decreased $11.8$6.4 billion to $88.5$85.7 billion during the ninesix months ended SeptemberJune 30, 20222023 as compared to $100.3$92.1 billion during the ninesix months ended SeptemberJune 30, 2021,2022, a decrease of 12%7%.
Amortization
Amortization expense on the accompanying Consolidated Statements of Operations consists of: 
Three Months Ended September 30,Percent ChangeNine Months Ended September 30,Percent ChangeThree Months Ended June 30,Percent ChangeSix Months Ended June 30,Percent Change
2022202120222021 2023202220232022
Capitalized software development costsCapitalized software development costs$7,287 $13,408 (46)%$34,045 $40,183 (15)%Capitalized software development costs$6,507 $13,204 (51)%$12,812 $26,758 (52)%
Intangible assets acquired through acquisitions and asset purchasesIntangible assets acquired through acquisitions and asset purchases3,038 1,196 154%9,534 3,312 188%Intangible assets acquired through acquisitions and asset purchases3,055 3,253 (6)%6,113 6,496 (6)%
OtherOther1187069%198254(22)%Other685133%129141(9)%
Total amortization expenseTotal amortization expense$10,443 $14,674 (29)%$43,777 $43,749 —%Total amortization expense$9,630 $16,508 (42)%$19,054 $33,395 (43)%
Capitalized software development costs
Capitalized software development costs are amortized on a project basis using the straight-line method over the estimated economic life of the product or enhancement. The capitalization of the initial development work related to SWP begandecrease in mid-2007 when the platform was determined to be ready for its intended use. The amortization expense related to the initial software development costs ended in the second quarter of 2022. As a result, amortization expense related to capitalized software development costs declined induring the three and ninesix months ended SeptemberJune 30, 2023 was primarily due to the amortization of the initial development costs for the SEI Wealth PlatformSM (SWP). The amortization period for these costs ended during the second quarter of 2022, resulting in a lower level of amortization expense for SWP beginning in the third quarter 2022 (See Note 1 to the Consolidated Financial Statements).




37


Intangible assets acquired through acquisitions and asset purchases
The increase in amortization expense in the three and nine month periods was due to the acquisitions of Finomial, SEI Novus and Atlas Master Trust during the fourth quarter 2021. Through these transactions, we acquired intangible assets related to technology, trade names and client relationships which are amortized over the estimated useful life of the assets (See Note 12 to the Consolidated Financial Statements).
Income Taxes
The effective income tax rates for the three and ninesix months ended SeptemberJune 30, 20222023 and 20212022 differ from the federal income tax statutory rate due to the following:
Three Months Ended September 30,Nine Months Ended September 30,Three Months Ended June 30,Six Months Ended June 30,
20222021202220212023202220232022
Statutory rateStatutory rate21.0 %21.0 %21.0 %21.0 %Statutory rate21.0 %21.0 %21.0 %21.0 %
State taxes, net of federal tax benefitState taxes, net of federal tax benefit3.4 2.5 2.9 3.0 State taxes, net of federal tax benefit2.8 2.8 2.8 2.8 
Foreign tax expense and tax rate differentialForeign tax expense and tax rate differential(0.2)(0.1)(0.1)(0.1)Foreign tax expense and tax rate differential(0.2)(0.1)(0.2)(0.1)
Tax benefit from stock option exercisesTax benefit from stock option exercises(1.1)(0.6)(0.5)(1.0)Tax benefit from stock option exercises(0.1)(0.3)(0.2)(0.3)
State settlements— (0.3)— (0.2)
Provision-to-return adjustment— (0.5)— (0.2)
Other, netOther, net(0.1)(0.3)(0.2)(0.3)Other, net(0.1)(0.3)0.1 (0.3)
23.0 %21.7 %23.1 %22.2 %23.4 %23.1 %23.5 %23.1 %
The increase in the effective tax rate for the three and six months ended SeptemberJune 30, 2022 was primarily due to an increase in the state effective tax rate and one-time state settlements which reduced the effective rate in 2021. Provision-to-return adjustments and statutory limitations which lowered the 2021 effective rate are expected to be realized in the fourth quarter of 2022. The increase was partially offset by increased tax benefits related to the stock option exercises as a percentage of net income in the third quarter of 2022 compared to the third quarter of 2021.
The increase in the effective tax rate for the nine months ended September 30, 20222023 was primarily due to decreased tax benefits related to the lower volume of stock option exercises and a decrease in 2022credits associated with research and development as compared to the prior year period as well as the timing of one-time state settlements which reduced the effective rate in 2021. Provision-to-return adjustments and statutory limitations which lowered the 2021 effective rate for the nine month period are expected to be realized in the fourth quarter of 2022.period.
Stock-Based Compensation
We recognized $31.3$15.5 million and $31.2$20.6 million in stock-based compensation expense during the ninesix months ended SeptemberJune 30, 2023 and 2022, respectively. Stock-based compensation was impacted by a higher level of cancellations of stock options due to the departure of employees through the Voluntary Separation Program (VSP) and 2021, respectively. the departure of certain senior executives unrelated to the VSP. The higher level of cancellations resulted in a decrease in the amount of expense recognized during 2023 as compared to the prior year period.
The amount of stock-based compensation expense we recognizerecognized is primarily based upon management's estimate of when the financial vesting targets of outstanding stock options may be achieved. Any change in the estimate could result in the amount of stock-based compensation expense to be accelerated, spread out over a longer period, or reversed. This may cause volatility in the recognition of stock-based compensation expense in future periods and could materially affect earnings.
We revised our estimate of when some vesting targets are expected to be achieved. This change in estimate resulted in a decrease of $2.8 million in stock-based compensation expense during the ninesix months ended SeptemberJune 30, 2022.2023. We expect to recognize approximately $9.3$13.7 million in stock-based compensation expense during the remainder of 2022.2023.
Fair Value Measurements
The fair value of financial assets and liabilities, except for the investment funds sponsored by LSV, is determined in accordance with the fair value hierarchy. The fair value of the investment funds sponsored by LSV is measured using the net asset value per share (NAV) as a practical expedient. The fair value of all other financial assets are determined using




37


Level 1 or Level 2 inputs and consist mainly of investments in equity or fixed-income mutual funds that are quoted daily and Government National Mortgage Association (GNMA) and other U.S. government agency securities that are single issuer pools that are valued based on current market data of similar assets. Level 3 financial liabilities at SeptemberJune 30, 20222023 and December 31, 20212022 consist entirely of the estimated contingent consideration resulting from an acquisition (See Note 12 to the Consolidated Financial Statements).
Regulatory Matters
Like many firms operating within the financial services industry, we are experiencing a complex and changing regulatory environment across our markets. Our current scale and reach as a provider to the financial services industry, the introduction and implementation of new solutions for our financial services industry clients, the increased regulatory




38


oversight of the financial services industry generally, new laws and regulations affecting the financial services industry and ever-changing regulatory interpretations of existing laws and regulations, and a greater propensity of regulators to pursue enforcement actions and other sanctions against regulated entities, have made this an increasingly challenging and costly regulatory environment in which to operate.
SEI and some of our regulated subsidiaries have undergone or been scheduled to undergo a range of periodic or thematic reviews, examinations or investigations by numerous regulatory authorities around the world, including the Office of the Comptroller of the Currency, the Securities and Exchange Commission, the Financial Industry Regulatory Authority, the Financial Conduct Authority of the United Kingdom (FCA), the Central Bank of Ireland and others. These regulatory activities typically result in the identification of matters or practices to be addressed by us or our subsidiaries and, in certain circumstances, the regulatory authorities require remediation activities or pursue enforcement proceedings against us or our subsidiaries. From time to time, the regulators in different jurisdictions will elevate their level of scrutiny of our operations as our business expands or is deemed critical to the operations of the relevant financial markets. As described under the caption “Regulatory Considerations” in our Annual Report on Form 10-K, the range of possible sanctions that are available to regulatory authorities include limitations on our ability to engage in business for specified periods of time, the revocation of registration, censures and fines. The direct and indirect costs of responding to these regulatory activities and of complying with new or modified regulations, as well as the potential financial costs and potential reputational impact against us of any enforcement proceedings that might result, is uncertain but could have a material adverse impact on our operating results or financial position.
Liquidity and Capital Resources 
Nine Months Ended September 30, Six Months Ended June 30,
20222021 20232022
Net cash provided by operating activitiesNet cash provided by operating activities$428,519 $483,881 Net cash provided by operating activities$182,454 $330,615 
Net cash used in investing activitiesNet cash used in investing activities(60,342)(87,542)Net cash used in investing activities(25,809)(42,516)
Net cash used in financing activitiesNet cash used in financing activities(381,338)(387,390)Net cash used in financing activities(239,465)(332,173)
Effect of exchange rate changes on cash, cash equivalents and restricted cashEffect of exchange rate changes on cash, cash equivalents and restricted cash(26,809)(2,442)Effect of exchange rate changes on cash, cash equivalents and restricted cash6,812 (15,660)
Net (decrease) increase in cash, cash equivalents and restricted cash(39,970)6,507 
Net decrease in cash, cash equivalents and restricted cashNet decrease in cash, cash equivalents and restricted cash(76,008)(59,734)
Cash, cash equivalents and restricted cash, beginning of periodCash, cash equivalents and restricted cash, beginning of period831,758 787,727 Cash, cash equivalents and restricted cash, beginning of period853,359 831,758 
Cash, cash equivalents and restricted cash, end of periodCash, cash equivalents and restricted cash, end of period$791,788 $794,234 Cash, cash equivalents and restricted cash, end of period$777,351 $772,024 
OurThe credit facility provides for borrowings up to $325.0 million and is scheduled to expire in April 2026 (See Note 6 to the Consolidated Financial Statements). In November 2021, we borrowed $40.0 million under the credit facility for the funding of an acquisition (See Note 12 to the Consolidated Financial Statements). We made principal payments of $40.0 million during the nine month period ended September 30, 2022 to fully repay the outstanding balance of the credit facility.
As of October 20, 2022,July 13, 2023, we had outstanding letters of credit of $6.0$4.9 million which reduced the amount available under the credit facility. These letters of credit were primarily issued for the expansion of the corporate headquarters and are due to expire in late 2022.2023. As of October 20, 2022,July 13, 2023, the amount of the credit facility available for corporate purposes was $319.0$320.1 million.
The availability of the credit facility is subject to compliance with certain covenants set forth in the agreement. The credit facility contains covenants which restrict our ability to engage in transactions with affiliates other than wholly-owned subsidiaries or to incur liens or certain types of indebtedness as defined in the agreement. In the event of a default under the credit facility, we would also be restricted from paying dividends on, or repurchasing our common stock. Currently, our ability to borrow from the credit facility is not limited by any covenant of the agreement (See Note 6 to the Consolidated Financial Statements).
TheOn April 17, 2023, we amended the credit facility contains terms that utilizeagreement with the London InterBank Offered Rate (LIBOR) as a potential component of the interest ratelenders to be applied to any borrowings; however, an alternative reference rate is included under the agreement which provides for a specified replacement rate upon a LIBOR cessation event. At the time of a LIBOR cessation event, the replacement rate,add the Secured Overnight Financing Rate (SOFR), self-executes without as an alternative reference rate for borrowings in place of LIBOR. All other terms and conditions of the need for negotiations or a formal amendment process.original agreement remain in effect.




38


The majority of excess cash reserves are primarily placed in accounts located in the United States that invest entirely in SEI-sponsored money market mutual funds denominated in the U.S. dollar. We also utilize demand deposit accounts or money market accounts at several large, well-established financial institutions located in the United States. The institutions we utilize have not indicated any stability issues regarding the ability to honor current or future deposit obligations to their customers. Accounts used to manage these excess cash reserves do not impose any restrictions or limitations that would prevent us from being able to




39


access such cash amounts immediately. As of October 20, 2022,July 13, 2023, the amount of cash and cash equivalents considered free and immediately accessible for other general corporate purposes was $389.7$399.4 million.
Cash and cash equivalents include accounts managed by subsidiaries that are used in their operations or to cover specific business and regulatory requirements. The availability of this cash for other purposes beyond the operations of these subsidiaries may be limited. We therefore do not include accounts of foreign subsidiaries in the calculation of free and immediately accessible cash for other general corporate purposes. A portion of the undistributed earnings of foreign subsidiaries are deemed repatriated. Any subsequent transfer of available cash related to the repatriated earnings of foreign subsidiaries could significantly increase free and immediately accessible cash.
Cash flows from operations decreased $55.4$148.2 million in the first ninesix months of 20222023 compared to the first ninesix months of 20212022 primarily from the decline in net income. The positiveincome and the negative impact from the change in the Company's working capital accounts partially offset the decrease in cash flows from operations.accounts.
Net cash used in investing activities includes:
Purchases, sales and maturities of marketable securities. Purchases, sales and maturities of marketable securities in the first ninesix months of 20222023 and 20212022 were as follows:
Nine Months Ended September 30,Six Months Ended June 30,
2022202120232022
PurchasesPurchases$(124,454)$(168,333)Purchases$(48,046)$(96,642)
Sales and maturitiesSales and maturities124,219 134,222 Sales and maturities61,722 90,659 
Net investing activities from marketable securitiesNet investing activities from marketable securities$(235)$(34,111)Net investing activities from marketable securities$13,676 $(5,983)
See Note 5 to the Consolidated Financial Statements for more information related to marketable securities.
The capitalization of costs incurred in developing computer software. We capitalized $24.8$18.0 million of software development costs in the first ninesix months of 20222023 as compared to $19.5$13.8 million in the first ninesix months of 2021. The majority of our software2022. Software development costs are principally related to significant enhancements for the expanded functionality of the SEI Wealth Platform. We capitalized $5.3 million of software development costs in the first nine months of 2022 forPlatform and a new platform for the Investment Managers segment.
Capital expenditures. Capital expenditures in the first ninesix months of 20222023 were $32.3$16.5 million as compared to $22.5$19.8 million in the first ninesix months of 2021.2022. Expenditures in 20222023 and 20212022 include capital outlays for purchased software and equipment for data center operations. We continue to evaluate improvements to our information technology infrastructure which, if implemented, will result in additional expenditures for purchased software and equipment for data center operations.
Net cash used in financing activities includes:
Principal repayments on revolving credit facility. In November 2021, we borrowed $40.0 million for the funding of an acquisition. We made principal payments of $40.0 million during the first six months of 2022 to fully repay the outstanding balance of the credit facility. We have no borrowings through the credit facility as of June 30, 2023.
The repurchase of common stock. Our Board of Directors has authorized the repurchase of common stock through multiple authorizations. Currently, there is no expiration date for the common stock repurchase program. We had total capital outlays of $266.5$156.2 million during the first ninesix months of 20222023 and $315.8$210.3 million during the first ninesix months of 20212022 for the repurchase of common stock.
Proceeds from the issuance of common stock. We received $35.9$32.4 million and $28.8 million in proceeds from the issuance of common stock during the first ninesix months of 2023 and 2022, and 2021.respectively. These proceeds were primarily from stock option exercise activity.
Dividend payments. Cash dividends paid were $114.8 million in the first six months of 2023 as compared to $109.8 million in the first ninesix months of 2022 as compared to $105.5 million in the first nine months of 2021.2022.
Cash Requirements
Cash requirements and liquidity needs are primarily funded through cash flow from operations and our capacity for additional borrowing. At SeptemberJune 30, 2022,2023, unused sources of liquidity consisted of cash and cash equivalents and the amount available under our credit facility.




39


We are obligated to make payments in connection with the credit facility, operating leases, maintenance contracts and other commitments. We believe our operating cash flow, available borrowing capacity, and existing cash and cash equivalents will provide adequate funds for these obligations and ongoing operations. We currently anticipate that our




40


available funds and cash flow from operations will be sufficient to meet our operational cash needs and fund our stock repurchase program for at least the next 12 months and for the foreseeable future.
Forward-Looking Information and Risk Factors
The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for forward-looking statements. Certain information contained in this discussion is or may be considered forward-looking. Forward-looking statements relate to future operations, strategies, financial results or other developments. Forward-looking statements are based upon estimates and assumptions that involve certain risks and uncertainties, many of which are beyond our control or are subject to change. Although we believe our assumptions are reasonable, they could be inaccurate. Our actual future revenues and income could differ materially from our expected results. We have no obligation to publicly update or revise any forward-looking statements.
Among the risks and uncertainties which may affect our future operations, strategies, financial results or other developments are those risks described in our latest Annual Report on Form 10-K in Part I, Item 1A. These risks include the following:
changes in capital markets and significant changes in the value of financial instruments that may affect our revenues and earnings;
product development risk;
risk of failure by a third-party service provider;
pricing pressure from increased competition, disruptive technology and poor investment performance;
the affect on our earnings and cashflows from the performance of LSV Asset Management;
consolidation within our target markets;
external factors affecting the fiduciary management market;
software defects, development delays or installation difficulties, which would harm our business and reputation and expose us to potential liability;
data and cyber security risks;
risk of the disclosure and misuse of personal data;
risk of outages, data losses, and disruptions of services;
intellectual property risks;
third-party service providers in our operations;
poor investment performance of our investment products or a client preference for products other than those which we offer or for products that generate lower fees;
investment advisory contracts which may be terminated or may not be renewed on favorable terms;
operational risks associated with the processing of investment transactions;
systems and technology risks;
the affecteffect of extensive governmental regulation;
the results of commercial disputes, litigation and regulatory examinations and investigations;
our ability to capture the expected value from acquisitions, divestitures, joint ventures, minority stakesinvestments or strategic alliances;
increased costs and regulatory risks from the growth of our business;
our ability to meet competing and/or conflicting regulatory requirements of the different jurisdictions;
fiduciary or other legal liability for client losses from our investment management operations;
our ability to receive dividends or other payments in needed amounts from our subsidiaries;
the exit by the United Kingdom from the European Union;
the effectiveness of our business, risk management and business continuity strategies, models and processes;
financial and non-financial covenants which may restrict our ability to manage liquidity needs;
changes in, or interpretation of, accounting principles or tax rules and regulations;
fluctuations in foreign currency exchange rates;




40


fluctuations in interest rates affecting the value of our fixed-income investment securities;
disruptions of operations of other participants in the global financial system;
our ability to hire and retain qualified employees;
the competence and integrity of our employees and third-parties;
stockholder activism efforts;




41


retention of executive officers and senior management personnel;
unforeseen or catastrophic events, including the emergence of pandemic, extreme weather events or other natural disasters; and
geopolitical unrest and other events.
We conduct operations through many regulated wholly-owned subsidiaries. These subsidiaries include:
SEI Investments Distribution Co., or SIDCO, a broker-dealer registered with the SEC under the Securities Exchange Act of 1934 and a member of the Financial Industry Regulatory Authority, Inc., or FINRA;
SEI Investments Management Corporation, or SIMC, an investment advisor registered with the SEC under the Investment Advisers Act of 1940 and with the Commodity Futures Trading Commission, or CFTC, under the Commodity Exchange Act;
SEI Private Trust Company, or SPTC, a limited purpose federal thrift chartered and regulated by the Office of the Comptroller of the Currency;
SEI Trust Company, or STC, a Pennsylvania trust company, regulated by the Pennsylvania Department of Banking and Securities;
SEI Institutional Transfer Agent, Inc., or SITA, a transfer agent registered with the SEC under the Securities Exchange Act of 1934;
SEI Investments (Europe) Limited, or SIEL, an investment manager and financial institution subject to regulation by the Financial Conduct Authority of the United Kingdom;
SEI Investments Canada Company, or SEI Canada, an investment fund manager that has various other capacities that is regulated by the Ontario Securities Commission and various provincial authorities;
SEI Investments Global, Limited, or SIGL, a management company for Undertakings for Collective Investment in Transferable Securities, or UCITS, and for Alternative Investment Funds, or AIFs, that is regulated primarily by the Central Bank of Ireland, or CBI;
SEI Investments - Global Fund Services, Ltd., or GFSL, an authorized provider of administration services for Irish and non-Irish collective investment schemes that is regulated by the CBI;
SEI Investments - Depositary and Custodial Services (Ireland) Limited, or D&C, an authorized provider of depositary and custodial services that is regulated by the CBI;
SEI Investments - Luxembourg S.A., or SEI Lux, a professional of the specialized financial sector subject to regulation by the Commission de Surveillance du Secteur Financier of the Grand Duchy of Luxembourg;
SEI Investments Global (Cayman), Ltd., a full mutual fund administrator that is regulated by the Cayman Island Monetary Authority; and
SEI Investments (South Africa) (PTY) Limited, a Private Company that is a licensed Financial Service Provider regulated by the Financial Sector Conduct Authority.
In addition to the regulatory authorities listed above, our subsidiaries are subject to the jurisdiction of regulatory authorities in other foreign countries. In addition to our wholly-owned subsidiaries, we also own a minority interest of approximately 38.6% in LSV, which is also an investment advisor registered with the SEC.
The Company, its regulated subsidiaries, their regulated services and solutions and their customers are all subject to extensive legislation, regulation, and supervision that recently has been subject to, and continues to experience, significant change and increased regulatory activity. These changes and regulatory activities could have a material adverse effect on us and our clients.
The various governmental agencies and self-regulatory authorities that regulate or supervise the Company and its subsidiaries have broad administrative powers. In the event of a failure to comply with laws, regulations, and requirements of these agencies and authorities, the possible business process changes required or sanctions that may be imposed include the suspension of individual employees, limitations on our ability to engage in business for specified periods of time, the revocation of applicable registration as a broker-dealer, investment advisor or other regulated entity, and, as the case may be, censures and fines. Additionally, certain securities and banking laws applicable to us and our subsidiaries




41


provide for certain private rights of action that could give rise to civil litigation. Any litigation could have significant financial and non-financial consequences including monetary judgments and the requirement to take action or limit activities that could ultimately affect our business.
Governmental scrutiny from regulators, legislative bodies, and law enforcement agencies with respect to matters relating to our regulated subsidiaries and their activities, services and solutions, our business practices, our past actions and other matters has increased dramatically in the past several years. Responding to these examinations, investigations, actions,




42


and lawsuits, regardless of the ultimate outcome of the proceeding, is time consuming and expensive and can divert the time and effort of our senior management from our business. Penalties, fines and changes to business processes sought by regulatory authorities have increased substantially over the last several years, and certain regulators have been more likely in recent years to commence enforcement actions or to advance or support legislation targeted at the financial services industry. We continue to be subject to inquiries from examinations and investigations by supervisory and enforcement divisions of regulatory authorities and expect this to continue in the future. We believe this is also the case with many of our regulated clients. Governmental scrutiny and legal and enforcement proceedings can also have a negative impact on our reputation, our relationship with clients and prospective clients, and on the morale and performance of our employees, which could adversely affect our businesses and results of operations.
We are subject to U.S. and foreign anti-money laundering and financial transparency laws that require implementation of regulations applicable to financial services companies, including standards for verifying client identification and monitoring client transactions and detecting and reporting suspicious activities. We offer investment and banking solutions that also are subject to regulation by the federal and state securities and banking authorities, as well as foreign regulatory authorities, where applicable. Existing or future regulations that affect these solutions could lead to a reduction in sales of these solutions or require modifications of these solutions.
We must comply with economic sanctions and embargo programs administered by the Office of Foreign Assets Control (OFAC) and similar national and multinational bodies and governmental agencies outside the United States, as well as anti-corruption and anti-money laundering laws and regulations throughout the world. We can incur higher costs and face greater compliance risks in structuring and operating our businesses to comply with these requirements. Furthermore, a violation of a sanction or embargo program or anti-corruption or anti-money laundering laws and regulations could subject us and our subsidiaries, and individual employees, to regulatory enforcement actions as well as significant civil and criminal penalties.
Our businesses are also subject to privacy and data protection information security legal requirements concerning the use and protection of certain personal information. These include those adopted pursuant to the Gramm-Leach-Bliley Act and the Fair and Accurate Credit Transactions Act of 2003 in the United States, the General Data Protection Regulation (GDPR) in the EU, Canada’s Personal Information Protection and Electronic Documents Act, the Cayman Islands' Data Protection Law, and various other laws. Privacy and data security legislation is a priority issue in many states and localities in the United States, as well as foreign jurisdictions outside of the EU. For example, California enacted the California Consumer Privacy Act (CCPA) which broadly regulates the sale of the consumer information of California residents and grants California residents certain rights to, among other things, access and delete data about them in certain circumstances. Other states are considering similar proposals. Such attempts by the states to regulate have the potential to create a patchwork of differing and/or conflicting state regulations. Ensuring compliance under ever-evolving privacy legislation, such as GDPR and CCPA, is an ongoing commitment, which involves substantial costs.
Compliance with existing and future regulations and responding to and complying with recent increased regulatory activity affecting broker-dealers, investment advisors, investment companies, financial institutions, and their service providers could have a significant impact on us. We periodically undergo regulatory examinations and respond to regulatory inquiries and document requests. In addition, recent and continuing legislative activity in the United States and in other jurisdictions (including the European Union and the United Kingdom) have made and continue to make extensive changes to the laws regulating financial services firms. As a result of these examinations, inquiries, and requests, as a result of increased civil litigation activity, and as a result of these new laws and regulations, we engage legal counsel and other subject matter experts, review our compliance procedures, solution and service offerings, and business operations, and make changes as we deem necessary or as may be required by the applicable authority. These additional activities and required changes may result in increased expense or may reduce revenues.
Our bank clients are subject to supervision by federal, state, and foreign banking and financial services authorities concerning the manner in which such clients purchase and receive our products and services. Our plan sponsor clients and our subsidiaries providing services to those clients are subject to supervision by the Department of Labor and compliance with employee benefit regulations. Investment advisor and broker-dealer clients are regulated by the SEC, state securities authorities, or FINRA. Existing or future regulations applicable to our clients may affect our clients’ purchase of our products and services.




42


In addition, see the discussion of governmental regulations in Item 1A “Risk Factors” in our latest Annual Report on Form 10-K for a description of the risks that the current regulatory regimes and proposed regulatory changes may present for our business.





43


Item 3.    Quantitative and Qualitative Disclosures About Market Risk.
Information required by this item is set forth under the captions "Our revenues and earnings are affected by changes in capital markets and significant changes in the value of financial instruments" and "Changes in interest rates may affect the value of our fixed-income investment securities" in Item 1A Risk Factors and under the caption "Impact"Sensitivity of COVID-19"our revenues and earnings to capital market fluctuations" in Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations of our Annual Report on Form 10-K for the year ended December 31, 2021.2022. There have been no material changes to this information as it is disclosed in our Annual Report on Form 10-K for 2021.2022.

Item 4.    Controls and Procedures.
(a) Evaluation of Disclosure Controls and Procedures
Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures as of the end of the period covered by this report are effective in ensuring that information required to be disclosed by us in reports filed under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Act is accumulated and communicated to the issuer’s management including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. A controls system, no matter how well designed and operated, cannot provide absolute assurance that the objectives of the controls systems are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected.
(b) Change in Internal Control over Financial Reporting
No change in our internal control over financial reporting occurred during the quarter ended SeptemberJune 30, 20222023 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.




4443


PART II.    OTHER INFORMATION
Item 1.    Legal Proceedings.
We and certain of our subsidiaries are a party to or have property subject to litigation and other proceedings, examinations and investigations that arise in the ordinary course of our business that we do not believe are material. These types of matters could result in fines, penalties, cost reimbursements or contributions, compensatory or treble damages or non-monetary sanctions or relief. We believe the probabilityThe information required by this Item is remote that the outcome of any of these matters will have a material adverse effect on SEI as a whole, notwithstanding that the unfavorable resolution of any matter may have a material effect on our net earnings in any particular interim reporting period. We cannot predict the outcome of legal or other proceedings with certainty. These matters include the proceedings summarized in “Note 11. Commitments and Contingencies”incorporated by reference from Note 11 – “Legal Proceedings” included in our Notes to Consolidated Financial Statements.Part I, Item 1 of this Quarterly Report on Form 10-Q.

Item 1A.     Risk Factors.
Information regarding risk factors appears in Part I – Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2021.2022. There have been no material changes in the risk factors from those disclosed in the Annual Report on Form 10-K for 2021.2022.

Item 2.    Unregistered Sales of Equity Securities and Use of Proceeds.
(e)    Our Board of Directors has authorized the repurchase of up to $5.328$5.578 billion worth of our common stock through multiple authorizations.authorizations through June 30, 2023. Currently, there is no expiration date for the common stock repurchase program. On April 18, 2023, our Board of Directors approved an increase in the stock repurchase program by an additional $250.0 million.
Information regarding the repurchase of common stock during the three months ended SeptemberJune 30, 20222023 is as follows:
PeriodTotal Number
of Shares
Purchased
Average
Price Paid
per Share
Total Number of
Shares Purchased as
Part of Publicly
Announced Program
Approximate Dollar
Value of Shares that
May Yet Be
Purchased
Under the Program
July 2022100,000 $54.03 100,000 $216,507,000 
August 2022615,000 55.97 615,000 182,091,000 
September 2022175,000 54.94 175,000 172,477,000 
Total890,000 $55.55 890,000 
PeriodTotal Number
of Shares
Purchased
Average
Price Paid
per Share (1)
Total Number of
Shares Purchased as
Part of Publicly
Announced Program
Approximate Dollar
Value of Shares that
May Yet Be
Purchased
Under the Program
April 2023100,000 $58.30 100,000 $256,685,750 
May 2023722,000 57.91 722,000 214,866,619 
June 2023468,000 58.31 468,000 186,983,273 
Total1,290,000 $58.08 1,290,000 
(1) Average price paid per share does not include excise tax on stock repurchases.

Item 6.    Exhibits.
The following is a list of exhibits filed as part of the Form 10-Q.
101.INSXBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCHXBRL Taxonomy Extension Schema Document
101.CALXBRL Taxonomy Extension Calculation Linkbase Document
101.DEFXBRL Taxonomy Extension Definition Linkbase Document
101.LABXBRL Taxonomy Extension Label Linkbase Document
101.PREXBRL Taxonomy Extension Presentation Linkbase Document




4544


SIGNATURES
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.
 SEI INVESTMENTS COMPANY
Date:OctoberJuly 28, 20222023 By:/s/ Dennis J. McGonigle
 Dennis J. McGonigle
 Chief Financial Officer





4645