UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

________________

FORM 10-Q

________________

(Mark One)



x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED ~~SEPTEMBER~~JUNE 30, ~~2014~~2015



o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO

Commission File Number: 001-32236

________________

COHEN & STEERS, INC.

(Exact name of Registrant as specified in its charter)

________________



Delaware		14-1904657
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification No.)

280 Park Avenue New York, NY		10017
(Address of Principal Executive Offices)		(Zip Code)

(212) 832-3232

(Registrant’s telephone number, including area code)

________________

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 o

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

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

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

The number of shares of the registrant’s common stock, par value $0.01 per share, outstanding as of ~~November 3, 2014~~August 4, 2015 was ~~44,789,474.~~45,426,087.

COHEN & STEERS, INC. AND SUBSIDIARIES

Form 10-Q

Index



		Page
Part I.	Financial Information

Item 1.	Financial Statements	1

	Condensed Consolidated Statements of Financial Condition (Unaudited) as of ~~September~~June 30, ~~2014~~2015 and December 31, ~~2013~~2014	1

	Condensed Consolidated Statements of Operations (Unaudited) for the Three and ~~Nine~~Six Months Ended ~~September~~June 30, ~~2014~~2015 and ~~2013~~2014	2

	Condensed Consolidated Statements of Comprehensive Income (Unaudited) for the Three and ~~Nine~~Six Months Ended ~~September~~June 30, ~~2014~~2015 and ~~2013~~2014	3

	Condensed Consolidated Statements of Changes in Stockholders’ Equity and Redeemable Noncontrolling Interest (Unaudited) for the ~~Nine~~Six Months Ended ~~September~~June 30, ~~2014~~2015 and ~~2013~~2014	4

	Condensed Consolidated Statements of Cash Flows (Unaudited) for the ~~Nine~~Six Months Ended ~~September~~June 30, ~~2014~~2015 and ~~2013~~2014	5

	Notes to Condensed Consolidated Financial Statements (Unaudited)	7

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	24

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	3231

Item 4.	Controls and Procedures	3231

Part II.	Other Information *

Item 1.	Legal Proceedings	3332

Item 1A.	Risk Factors	3332

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	3332

Item 6.	Exhibits	3433

Signatures		3534

* Items other than those listed above have been omitted because they are not applicable.

Forward-Looking Statements

This report and other documents filed by us contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which reflect management's current views with respect to, among other things, our operations and financial performance. You ~~can~~may identify these forward-looking statements by the use of words such as “outlook,” “believes,” “expects,” “potential,” “may,” “should,” “seeks,” “predicts,” “intends,” “plans,” “estimates,” “anticipates” or the negative versions of these words or other comparable words. Such forward-looking statements are subject to various risks and uncertainties. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these forward-looking statements. We believe that these factors include, but are not limited to, the risks described in the Risk Factors section of our Annual Report on Form 10-K for the year ended December 31, ~~2013~~2014 (the ~~"Form 10-K")~~Form 10-K), which is accessible on the Securities and Exchange Commission’s website at www.sec.gov and on our website at www.cohenandsteers.com. These factors are not exhaustive and should be read in conjunction with the other cautionary statements that are included in this report, the Form 10-K and our other filings with the Securities and Exchange Commission. We undertake no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.

PART I—Financial Information

Item 1. Financial Statements

COHEN & STEERS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (Unaudited)

(in thousands, except share data)


	September 30, 2014			December 31, 2013			June 30, 2015			December 31, 2014
ASSETS
Cash and cash equivalents	$	137,807		$	128,277		$	125,807		$	124,938
Securities owned ($9,454 and $7,300) ⁽¹⁾	59,376			15,668
Trading investments ⁽¹⁾							8,863			9,509
Equity method investments	107			24,724			7,447			28,550
Investments, available-for-sale	21,814			10,449
Available-for-sale investments							38,420			21,269
Accounts receivable	50,950			40,888			44,455			43,392
Due from broker	5,063			2,906			1,784			1,805
Income tax receivable							10,839			56
Property and equipment—net	11,319			9,824			9,996			11,189
Goodwill	19,611			20,672
Intangible assets—net	1,635			1,701
Goodwill and intangible assets—net							19,801			20,732
Deferred income tax asset—net	13,421			14,144			4,295			15,108
Other assets	6,231			5,673			5,304			4,173
Total assets	$	327,334		$	274,926		$	277,011		$	280,721

LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities:
Accrued compensation	$	21,136		$	25,214		$	15,261		$	28,300
Deferred rent	5,778			4,344			5,885			5,728
Income tax payable	3,342			7,575			1,397			4,141
Other liabilities and accrued expenses	15,309			14,029			11,711			13,964
Total liabilities	45,565			51,162			34,254			52,133
Commitments and contingencies (See Note 11)
Redeemable noncontrolling interest	19,766			207			852			607
Stockholders’ equity:
Common stock, $0.01 par value; 500,000,000 shares authorized; 48,586,576 and 47,735,793 shares issued at September 30, 2014 and December 31, 2013, respectively	486			477
Common stock, $0.01 par value; 500,000,000 shares authorized; 49,670,244 and 48,593,812 shares issued at June 30, 2015 and December 31, 2014, respectively							497			486
Additional paid-in capital	479,835			457,138			507,180			489,266
Accumulated deficit	(101,783		)	(131,366		)	(124,380		)	(142,786		)
Accumulated other comprehensive income, net of tax	831			2,989
Less: Treasury stock, at cost, 3,800,014 and 3,481,942 shares at September 30, 2014 and December 31, 2013, respectively	(117,366		)	(105,681		)
Accumulated other comprehensive loss, net of tax							(4,809		)	(1,582		)
Less: Treasury stock, at cost, 4,248,788 and 3,800,920 shares at June 30, 2015 and December 31, 2014, respectively							(136,583		)	(117,403		)
Total stockholders’ equity	262,003			223,557			241,905			227,981
Total liabilities and stockholders’ equity	$	327,334		$	274,926		$	277,011		$	280,721

_________________________

(1) ~~Held~~Includes $653 and $650 held as collateral attributable to the consolidated balances of Cohen & Steers Active Commodities Strategy Fund, Inc. ~~("CDF") and Cohen & Steers Active Commodities Fund, LP ("ACOM")~~(CDF) as of ~~September~~June 30, ~~2014~~2015 and ~~ACOM as of~~ December 31, ~~2013.~~

2014, respectively.

See notes to condensed consolidated financial statements

COHEN & STEERS, INC. AND SUBSIDIARIES

CONDENSED 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,
	2014			2013			2014			2013			2015			2014			2015			2014
Revenue:
Investment advisory and administration fees	$	75,210		$	67,704		$	215,681		$	203,451		$	77,221		$	72,907		$	154,973		$	140,471
Distribution and service fees	3,738			3,627			10,952			10,802			4,014			3,744			7,920			7,214
Portfolio consulting and other	1,897			2,695			5,459			10,028			2,267			1,761			4,424			3,562
Total revenue	80,845			74,026			232,092			224,281			83,502			78,412			167,317			151,247
Expenses:
Employee compensation and benefits	26,679			24,058			76,590			72,330			28,395			25,876			54,378			49,911
Distribution and service fees	9,048			8,362			26,608			33,120			9,525			9,256			18,776			17,560
General and administrative	11,313			11,688			34,471			35,384			12,825			12,065			25,288			23,158
Depreciation and amortization	1,090			1,423			3,455			4,110			1,586			1,547			3,155			3,354
Amortization, deferred commissions	388			776			1,377			2,351
Total expenses	48,518			46,307			142,501			147,295			52,331			48,744			101,597			93,983
Operating income	32,327			27,719			89,591			76,986			31,171			29,668			65,720			57,264
Non-operating income:
Interest and dividend income—net	610			218			1,441			1,507			450			592			749			831
(Loss) gain from trading securities—net	(2,690		)	2,383			1,055			(6,956		)
Gain from available-for-sale securities—net	760			180			1,888			1,508
Equity in (losses) earnings of affiliates	(1,571		)	313			793			422
Gain (loss) from trading investments—net													205			2,762			(246		)	3,745
Gain from available-for-sale investments—net													320			52			420			1,128
Equity in earnings of affiliates													1,085			1,429			4			2,364
Other (losses) income	(666		)	209			(563		)	(430		)	(263		)	155			(682		)	103
Total non-operating (loss) income	(3,557		)	3,303			4,614			(3,949		)
Total non-operating income													1,797			4,990			245			8,171
Income before provision for income taxes	28,770			31,022			94,205			73,037			32,968			34,658			65,965			65,435
Provision for income taxes	10,733			11,205			33,644			29,210			12,194			11,734			24,420			22,911
Net income	18,037			19,817			60,561			43,827			20,774			22,924			41,545			42,524
Less: Net loss (income) attributable to redeemable noncontrolling interest	147			(1,534		)	(749		)	4,879
Less: Net (income) loss attributable to redeemable noncontrolling interest													(11		)	(741		)	34			(896		)
Net income attributable to common stockholders	$	18,184		$	18,283		$	59,812		$	48,706		$	20,763		$	22,183		$	41,579		$	41,628

Earnings per share attributable to common stockholders:
Basic	$	0.41		$	0.41		$	1.34		$	1.10		$	0.46		$	0.49		$	0.92		$	0.93
Diluted	$	0.40		$	0.41		$	1.31		$	1.08		$	0.45		$	0.49		$	0.91		$	0.91
Dividends declared per share	$	0.22		$	0.20		$	0.66		$	0.60		$	0.25		$	0.22		$	0.50		$	0.44
Weighted average shares outstanding:
Basic	44,839			44,317			44,766			44,254			45,462			44,825			45,352			44,730
Diluted	45,689			45,106			45,568			44,997			45,805			45,530			45,893			45,507

See notes to condensed consolidated financial statements

COHEN & STEERS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited)

(in thousands)

Three Months Ended
September 30, Nine Months Ended
September 30,
2014 2013 2014 2013
Net income $ 18,037
$ 19,817
$ 60,561
$ 43,827
Less: Net loss (income) attributable to redeemable noncontrolling interest 147
(1,534 ) (749 ) 4,879
Net income attributable to common stockholders 18,184
18,283
59,812
48,706
Foreign currency translation (loss) gain (net of tax of $0) (2,256 ) 1,233
(2,105 ) 890
Net unrealized gain from available-for-sale securities (net of tax of $0) 254
463
1,835
1,396
Reclassification to statements of operations of gain from available-for-sale securities (net of tax of $0) (760 ) (180 ) (1,888 ) (1,508 )
Total comprehensive income attributable to common stockholders $ 15,422
$ 19,799
$ 57,654
$ 49,484



	Three Months Ended June 30,						Six Months Ended June 30,
	2015			2014			2015			2014
Net income	$	20,774		$	22,924		$	41,545		$	42,524
Less: Net (income) loss attributable to redeemable noncontrolling interest	(11		)	(741		)	34			(896		)
Net income attributable to common stockholders	20,763			22,183			41,579			41,628
Foreign currency translation gain (loss) (net of tax of $0)	1,534			74			(544		)	151
Net unrealized (loss) gain from available-for-sale investments (net of tax of $0)	(2,248		)	491			(2,263		)	1,581
Reclassification to statements of operations of gain from available-for-sale investments (net of tax of $0)	(320		)	(52		)	(420		)	(1,128		)
Other comprehensive (loss) income	(1,034		)	513			(3,227		)	604
Total comprehensive income attributable to common stockholders	$	19,729		$	22,696		$	38,352		$	42,232

See notes to condensed consolidated financial statements

COHEN & STEERS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY AND

REDEEMABLE NONCONTROLLING INTEREST (Unaudited)

~~Nine~~Six Months Ended ~~September~~June 30, ~~2014~~2015 and ~~2013~~2014

(in thousands)


	Common Stock		Additional Paid-In Capital			Accumulated Deficit			Accumulated Other Comprehensive Income (Loss), Net of Tax			Treasury Stock			Total Stockholders’ Equity			Redeemable Noncontrolling Interest			Shares of Common Stock, Net
Beginning balance, January 1, 2013	$	470	$	429,377		$	(117,889	)	$	2,341		$	(97,719	)	$	216,580		$	53,188		43,763
Dividends	—		—			(27,300		)	—			—			(27,300		)	—			—
Issuance of common stock	7		388			—			—			—			395			—			728
Repurchase of common stock	—		—			—			—			(7,954		)	(7,954		)	—			(243	)
Tax benefits associated with restricted stock units—net	—		2,231			—			—			—			2,231			—			—
Issuance of restricted stock units	—		1,456			—			—			—			1,456			—			—
Amortization of restricted stock units—net	—		16,126			—			—			—			16,126			—			—
Forfeitures of vested restricted stock units	—		(10		)	—			—			—			(10		)	—			—
Net income (loss)	—		—			48,706			—			—			48,706			(4,879		)	—
Other comprehensive income, net of tax	—		—			—			778			—			778			—			—
Contributions from redeemable noncontrolling interest	—		—			—			—			—			—			37,711			—
Distributions to redeemable noncontrolling interest	—		—			—			—			—			—			(14,242		)	—
Transfer of redeemable noncontrolling interest in consolidated entity	—		—			—			—			—			—			(71,586		)	—
Ending balance, September 30, 2013	$	477	$	449,568		$	(96,483	)	$	3,119		$	(105,673	)	$	251,008		$	192		44,248
																							Common Stock		Additional Paid-In Capital		Accumulated Deficit			Accumulated Other Comprehensive Income (Loss), Net of Tax			Treasury Stock			Total Stockholders’ Equity			Redeemable Noncontrolling Interest			Shares of Common Stock, Net
Beginning balance, January 1, 2014	$	477	$	457,138		$	(131,366	)	$	2,989		$	(105,681	)	$	223,557		$	207		44,254		$	477	$	457,138	$	(131,366	)	$	2,989		$	(105,681	)	$	223,557		$	207		44,254
Dividends	—		—			(30,229		)	—			—			(30,229		)	—			—		—		—		(20,115		)	—			—			(20,115		)	—			—
Issuance of common stock	9		467			—			—			—			476			—			851		9		338		—			—			—			347			—			837
Repurchase of common stock	—		—			—			—			(11,685		)	(11,685		)	—			(318	)	—		—		—			—			(11,587		)	(11,587		)	—			(316	)
Tax benefits associated with restricted stock units—net	—		2,849			—			—			—			2,849			—			—		—		2,706		—			—			—			2,706			—			—
Issuance of restricted stock units	—		920			—			—			—			920			—			—		—		588		—			—			—			588			—			—
Amortization of restricted stock units—net	—		18,461			—			—			—			18,461			—			—		—		12,144		—			—			—			12,144			—			—
Net income	—		—			59,812			—			—			59,812			749			—		—		—		41,628			—			—			41,628			896			—
Other comprehensive income, net of tax	—		—			—			(2,158		)	—			(2,158		)	—			—		—		—		—			604			—			604			—			—
Contributions from redeemable noncontrolling interest	—		—			—			—			—			—			23,977			—		—		—		—			—			—			—			7,257			—
Distributions to redeemable noncontrolling interest	—		—			—			—			—			—			(4,958		)	—		—		—		—			—			—			—			(745		)	—
Transfer of redeemable noncontrolling interest in consolidated entity	—		—			—			—			—			—			(209		)	—		—		—		—			—			—			—			(209		)	—
Ending balance, September 30, 2014	$	486	$	479,835		$	(101,783	)	$	831		$	(117,366	)	$	262,003		$	19,766		44,787
Ending balance, June 30, 2014																							$	486	$	472,914	$	(109,853	)	$	3,593		$	(117,268	)	$	249,872		$	7,406		44,775

Beginning balance, January 1, 2015																							$	486	$	489,266	$	(142,786	)	$	(1,582	)	$	(117,403	)	$	227,981		$	607		44,793
Dividends																							—		—		(23,173		)	—			—			(23,173		)	—			—
Issuance of common stock																							11		391		—			—			—			402			—			1,076
Repurchase of common stock																							—		—		—			—			(19,180		)	(19,180		)	—			(448	)
Tax benefits associated with restricted stock units—net																							—		4,966		—			—			—			4,966			—			—
Issuance of restricted stock units																							—		684		—			—			—			684			—			—
Amortization of restricted stock units—net																							—		11,873		—			—			—			11,873			—			—
Net income (loss)																							—		—		41,579			—			—			41,579			(34		)	—
Other comprehensive loss, net of tax																							—		—		—			(3,227		)	—			(3,227		)	—			—
Contributions from redeemable noncontrolling interest																							—		—		—			—			—			—			279			—
Ending balance, June 30, 2015																							$	497	$	507,180	$	(124,380	)	$	(4,809	)	$	(136,583	)	$	241,905		$	852		45,421

See notes to condensed consolidated financial statements

COHEN & STEERS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

(in thousands)


	Nine Months Ended September 30,						Six Months Ended June 30,
	2014			2013			2015			2014
Cash flows from operating activities:
Net income	$	60,561		$	43,827		$	41,545		$	42,524
Adjustments to reconcile net income to net cash provided by operating activities:
Stock compensation expense	18,535			16,186			11,927			12,195
Amortization, deferred commissions	1,377			2,351
Depreciation and amortization	3,455			4,110			3,155			3,354
Deferred rent	1,434			1,465			157			1,486
(Gain) loss from trading securities—net	(1,055		)	6,956
Loss (gain) from trading investments—net							246			(3,745		)
Equity in earnings of affiliates	(793		)	(422		)	(4		)	(2,364		)
Gain from available-for-sale securities—net	(1,888		)	(1,508		)
Gain from available-for-sale investments—net							(420		)	(1,128		)
Deferred income taxes	647			(1,110		)	8,461			2,939
Foreign currency loss	1,798			313
Foreign currency gain							(413		)	(298		)
Changes in operating assets and liabilities:
Accounts receivable	(11,860		)	(8,642		)	(650		)	(1,166		)
Due from broker	(2,157		)	(7,758		)	21			(1,165		)
Deferred commissions	(1,426		)	(2,096		)	(1,328		)	(921		)
Securities owned	(42,653		)	(7,756		)
Trading investments							400			(30,409		)
Income tax receivable							(10,783		)	(1,058		)
Other assets	(467		)	2,294			(907		)	(954		)
Accrued compensation	(4,049		)	(5,865		)	(13,014		)	(11,399		)
Securities sold but not yet purchased	—			(14,685		)
Income tax payable	(3,850		)	245			(164		)	(5,744		)
Other liabilities and accrued expenses	1,312			13,177			(2,048		)	691
Net cash provided by operating activities	18,921			41,082			36,181			2,838
Cash flows from investing activities:
Proceeds from redemptions of equity method investments—net	10,894			7,746			4			454
Purchases of investments, available-for-sale	(6,051		)	(8,179		)
Proceeds from sales of investments, available-for-sale	10,969			20,244
Purchases of available-for-sale investments							(2,932		)	(3,603		)
Proceeds from sales of available-for-sale investments							4,616			8,289
Purchases of property and equipment	(4,889		)	(4,327		)	(813		)	(2,161		)
Net cash provided by investing activities	10,923			15,484			875			2,979
Cash flows from financing activities:
Excess tax benefits associated with restricted stock units	2,537			1,994			4,738			2,498
Issuance of common stock	405			336			341			295
Repurchase of common stock	(11,685		)	(7,954		)	(19,180		)	(11,587		)
Dividends to stockholders	(29,562		)	(26,558		)	(22,714		)	(19,704		)
Distributions to redeemable noncontrolling interest	(4,958		)	(14,242		)	—			(745		)
Contributions from redeemable noncontrolling interest	23,977			37,711			279			7,257
Net cash used in financing activities	(19,286		)	(8,713		)	(36,536		)	(21,986		)
Net increase in cash and cash equivalents	10,558			47,853
Net increase (decrease) in cash and cash equivalents							520			(16,169		)
Effect of foreign exchange rate changes on cash and cash equivalents	(1,028		)	580			349			220
Cash and cash equivalents, beginning of the period	128,277			95,412			124,938			128,277
Cash and cash equivalents, end of the period	$	137,807		$	143,845		$	125,807		$	112,328

See notes to condensed consolidated financial statements

COHEN & STEERS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS—(Continued)

(UNAUDITED)

Supplemental disclosures of cash flow information:

For the ~~nine~~six months ended ~~September~~June 30, ~~2014~~2015 and ~~2013~~2014, the Company paid taxes, net of tax refunds, of approximately ~~$34,209,000~~$22,197,000 and $~~28,288,000~~24,328,000, respectively.

Supplemental disclosures of non-cash investing and financing activities:

In connection with its stock incentive plan, for the ~~nine~~six months ended ~~September~~June 30, ~~2014~~2015 and ~~2013~~2014, the Company issued fully vested restricted stock units in the amount of $~~252,000~~225,000 and $~~714,000~~177,000, respectively. For the ~~nine~~six months ended ~~September~~June 30, ~~2014~~2015 and ~~2013~~2014, the Company recorded dividend equivalent restricted stock ~~unit dividend equivalents,~~units, net of forfeitures, in the amount of $~~667,000~~459,000 and $~~742,000~~411,000, respectively.

As further described in Note 4, during the ~~nine~~six months ended ~~September~~June 30, ~~2014,~~2015, the ~~Company redeemed a portion of its shares from~~Company's proportionate ownership interest in Cohen & Steers ~~Real Assets~~MLP & Energy Opportunity Fund, Inc. ~~("RAP")~~(MLO) decreased and the Company recorded a non-cash reclassification of ~~$14,909,000,~~$21,103,000, which ~~represents~~represented the Company's proportionate share of ~~RAP,~~MLO, from equity method investments into ~~investments, available-for-sale.~~

During the nine months ended September 30, 2013, the Company’s proportionate ownership interest in RAP decreased and the Company deconsolidated the assets and liabilities of RAP resulting in a non-cash reduction of $71,586,000 from redeemable noncontrolling interest and a non-cash increase of $23,519,000 to equity methodavailable-for-sale investments.

COHEN & STEERS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

1. Organization and Description of Business

Cohen & Steers, Inc. ~~(“CNS”)~~(CNS) was organized as a Delaware corporation on March 17, 2004. CNS is the holding company for its direct and indirect subsidiaries, including Cohen & Steers Capital Management, Inc. ~~(“CSCM”)~~(CSCM), Cohen & Steers Securities, LLC ~~(“CSS”)~~(CSS), Cohen & Steers Asia Limited (CSAL), Cohen & Steers UK Limited (CSUK) and Cohen & Steers Japan, LLC (collectively, the ~~“Company”)~~Company).

The Company is a global investment manager specializing in liquid real assets, including real estate securities, listed infrastructure, commodities and natural resource equities, as well as preferred securities and other income solutions. Founded in 1986, the Company is ~~a leading global investment manager~~headquartered in New York City, with ~~a long history~~offices in London, Hong Kong, Tokyo and Seattle.

2. Basis of ~~innovation~~Presentation and a focus on real assets, including real estate, infrastructure and commodities. The Company serves institutional and individual investors around the world. Its clients include Company-sponsored open-end and closed-end mutual funds, U.S. and non-U.S. pension plans, endowment funds, foundations and subadvised funds for other financial institutions. Significant Accounting Policies

The condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ~~(“GAAP”)~~(GAAP). The condensed consolidated financial statements set forth herein include the accounts of CNS and its direct and indirect subsidiaries. Intercompany balances and transactions have been eliminated in consolidation.

~~2. Basis of Presentation and Significant Accounting Policies~~

The condensed consolidated financial statements of the Company included herein are unaudited and have been prepared in accordance with the instructions to Form 10-Q pursuant to the rules and regulations of the Securities and Exchange Commission ~~(“SEC”)~~(SEC). In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of the interim results have been made. The Company’s condensed consolidated financial statements and the related notes should be read together with the consolidated financial statements and the related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2013.~~2014.

Accounting Estimates—The preparation of the condensed consolidated financial statements in conformity with GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosures of contingent assets and liabilities at the dates of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting periods. Management believes the estimates used in preparing the condensed consolidated financial statements are reasonable and prudent. Actual results could differ from those estimates.

Reclassifications—Certain prior year amounts have been reclassified to conform to the current year presentation.

Consolidation—The Company consolidates operating entities deemed to be voting interest entities if the Company owns a majority of the voting interest. The Company also consolidates any variable interest entities (VIEs) in which the Company is the primary beneficiary. The Company records noncontrolling interests in consolidated subsidiaries for which the Company’s ownership is less than 100 percent. The equity method of accounting is used for investments in ~~non-controlled~~ affiliates in which the Company’s ownership ranges from 20 to 50 percent, or in instances in which the Company is able to exercise significant influence but not control. The Company also consolidates any variable interest entities (“VIEs”) in which the Company is the primary beneficiary. The Company records noncontrolling interests in consolidated subsidiaries for which the Company’s ownership is less than 100 percent.

A VIE is an entity in which either (a) the equity investment at risk is not sufficient to permit the entity to finance its own activities without additional financial support or (b) the group of holders of the equity investment at risk lack certain characteristics of a controlling financial interest. The primary beneficiary is the entity that has the obligation to absorb a majority of the expected losses or the right to receive the majority of the residual returns. Investments and redemptions or amendments to the governing documents of the respective entities could affect an entity's status as a VIE or the determination of the primary beneficiary. The Company assesses whether entities in which it has an interest are VIEs upon initial involvement and at each reporting date. The Company assesses whether it is the primary beneficiary of any VIEs identified by evaluating its economic interests in the entity held either directly by the Company and its affiliates or indirectly through employees. See Note 4 for further discussion about the Company’s investments.

Cash and Cash Equivalents—Cash equivalents consist of short-term, highly liquid investments, which are readily convertible into cash and have original maturities of three months or less.

COHEN & STEERS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(UNAUDITED)

Due from Broker—The Company conducts business, primarily with respect to its consolidated seed investments, with brokers for certain of its investment activities. The clearing and custody operations for these investment activities are performed pursuant to ~~agreements with prime brokers.~~contractual agreements. The due from broker balance represents cash and cash equivalents balances at ~~brokers~~brokers/custodians and net receivables and payables for unsettled security ~~transactions related to the Company's consolidated seed investments.~~transactions.

Investments—Management of the Company determines the appropriate classification of its investments at the time of purchase and re-evaluates such determination at each statement of financial condition date.

~~Securities owned are~~Investments classified as trading ~~securities and~~ represent securities held within the affiliated funds that the Company ~~consolidates. These securities~~consolidates and are measured at fair value based on quoted market prices, market prices obtained from independent pricing services engaged by management or as determined by the Company’s valuation ~~committee in accordance with its valuation guidance and procedures.~~committee. Unrealized gains and losses are recorded as gain (loss) from trading ~~securities—~~investments—net in the Company’s condensed consolidated statements of operations.

Investments classified as equity method investments represent seed investments that are accounted for using the equity method, under which the Company recognizes its respective share of the investee’s net income or loss for the period. As of ~~September~~June 30, ~~2014~~2015, the Company's equity method investments consisted of ~~an interest~~interests in an affiliated ~~fund~~funds which ~~measures its~~measure their underlying investments at fair value and ~~reports~~report a net asset value on a recurring basis. The carrying ~~amount~~amounts of ~~this investment approximates its~~these investments approximate their fair value.

Investments classified as available-for-sale are comprised of equity securities, investment-grade preferred instruments and investments in Company-sponsored open-end ~~and closed-end~~ mutual funds. These investments are carried at fair value based on quoted market prices or market prices obtained from independent pricing services engaged by management, with unrealized gains and losses, net of tax, reported in accumulated other comprehensive income. The Company periodically reviews each individual security position that has an unrealized loss, or impairment, to determine if that impairment is other than temporary. If the Company believes an impairment of a security position is other than temporary, based on available quantitative and qualitative information as of the report date, the loss will be recognized in the Company’s condensed consolidated statements of operations. ~~An other than temporary impairment is presumed to have occurred if the available-for-sale investment has an unrealized loss continuously for 12 or more months.~~

From time to time, the affiliated funds consolidated by the Company enter into derivative contracts to gain exposure to the underlying commodities markets or to hedge market and credit risks of the underlying portfolios utilizing options, total return swaps, credit default swaps and futures contracts. These instruments are measured at fair value with gains and losses recorded as gain (loss) from trading ~~securities—~~investments—net in the Company's condensed consolidated statements of operations. The fair values of these instruments are recorded in other assets or other liabilities and accrued expenses in the Company's condensed consolidated statements of financial condition. As of ~~September~~June 30, ~~2014,~~2015, none of the outstanding derivative contracts were subject to ~~any~~a master netting ~~arrangement~~agreement or other similar ~~agreement.~~arrangement.

Additionally, from time to time, the Company enters into foreign exchange contracts to hedge its currency exposure related to client receivables. These instruments are measured at fair value with gains and losses recorded in other non-operating income in the Company's condensed consolidated statements of operations. The fair values of these contracts are recorded in other assets or other liabilities and accrued expenses in the Company's condensed consolidated statements of financial condition.

Goodwill and Intangible Assets—Goodwill represents the excess of the cost of the Company’s investment in the net assets of an acquired company over the fair value of the underlying identifiable net assets at the date of acquisition. Goodwill and indefinite lived intangible assets are not amortized but are tested at least annually for impairment by comparing the fair value to their carrying amounts. Finite lived intangible assets are amortized over their useful lives and are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. See Note 3 for further discussion about the Company’s goodwill and intangible assets.

Redeemable Noncontrolling Interest—Redeemable noncontrolling interest represents third-party interests in the Company's consolidated entities. This interest is redeemable at the option of the investors and therefore is not treated as permanent equity. Redeemable noncontrolling interest is remeasured at redemption value which approximates the fair value at each reporting period.

COHEN & STEERS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(UNAUDITED)

Investment Advisory and Administration Fees—The Company earns revenue by providing asset management services to institutional accounts and to Company-sponsored open-end mutual funds and closed-end ~~mutual~~ funds. Investment advisory fees are earned pursuant to the terms of ~~underlying advisory contracts,~~investment management agreements, and are based on a contractual fee rate applied to the assets in the ~~portfolio, net of applicable waivers, if any.~~portfolio. The Company also earns administration fees from certain Company-sponsored open-end mutual funds and closed-end funds pursuant to the terms of underlying administration contracts. Administration fees are based on the average assets under management of such funds. Investment advisory and administration ~~fees~~fee revenue is recognized as such fees are earned.

Distribution and Service Fee Revenue—CSS acts as the principal distributor of the Company’s sponsored open-end mutual funds which may offer the following classes: Class A (initial sales load), Class C (back end sales load), Class R (load retirement) and Class Z (no load retirement). Effective May 2007, the Company suspended sales of Class B shares and all remaining Class B shares ~~are expected to convert~~converted to Class A shares in 2015. Distribution and service fee revenue is based on the average daily net assets of the funds as detailed below. Distribution and service fee revenue is earned daily and is recorded gross of any third-party distribution and service fee expense for applicable share classes.

Pursuant to distribution plans with the Company's sponsored open-end mutual funds, CSS receives distribution fees of up to 25bps for Class A shares, 75bps for Class C shares and 50bps for Class R shares. CSS also receives shareholder servicing fees of up to 10bps on Class A shares, 25bps on Class C shares and ~~15 bps~~15bps on Class Z shares, pursuant to shareholder servicing plans with the funds. Effective October 1, 2014, the Company no longer receives shareholder servicing ~~fee revenue will no longer accrue~~fees on Class Z shares.

Distribution and Service Fee Expense—Distribution and service fee expense includes distribution fees, service fees and intermediary assistance payments. Distribution and service fee expense is recorded as incurred.

Distribution fee expense represents payments made to qualified dealers/institutions for (i) assistance in connection with the distribution of the Company's sponsored open-end mutual funds' shares and (ii) for other expenses such as advertising costs and printing and distribution of prospectuses to investors. Such amounts may also be used to pay financial intermediaries for services as specified in the terms of written agreements complying with Rule 12b-1 of the Investment Company Act of 1940 ~~(“Rule 12b-1”)~~(Rule 12b-1). CSS pays distribution fee expense based on the average daily net assets under management of ~~25 bps~~up to 25bps on Class A shares, 75bps on Class C shares and 50bps on Class R shares.

Shareholder servicing fee expense represents payments made to qualified dealers/institutions for shareholder account service and maintenance. These services are provided pursuant to written agreements with such qualified ~~financial~~ institutions. CSS pays service fee expenses based on the average daily net assets under management of up to 10bps on Class A shares, 25bps on Class C shares and ~~15 bps~~15bps on Class Z shares. Effective October 1, 2014, the Company no longer pays shareholder service fees on Class Z ~~shares will no longer pay shareholder service fees.~~shares.

Intermediary assistance payments represent payments to qualified dealers/institutions for activities related to distribution, shareholder servicing and marketing and support of Company-sponsored open-end mutual funds and are incremental to those described above. Intermediary assistance payments ~~may be~~are generally based on the average assets under management or the number of accounts being ~~serviced, or a combination thereof.~~

During the first quarter of 2013, the Company made payments of approximately $7.2 million associated with an additional compensation agreement entered into in connection with the offering of Cohen & Steers MLP Income and Energy Opportunity Fund, Inc. ("MIE") These payments are included in distribution and service fee expense on the accompanying condensed consolidated statements of operations for the nine months ended September 30, 2013.serviced.

Portfolio Consulting and Other—The Company earns portfolio consulting and other fees by: i)(i) providing portfolio consulting services in connection with model-based ~~strategies~~strategy accounts; ~~ii)~~(ii) earning a licensing fee for the use of the Company's proprietary ~~indices;~~indexes; and ~~iii)~~(iii) providing portfolio monitoring services related to a number of unit investment trusts. This revenue is earned pursuant to the terms of the underlying contract, and the fee schedules for these relationships vary based on the type of services the Company provides for each relationship. This revenue is recognized as such fees are earned.

Stock-based Compensation—The Company recognizes compensation expense for the grant-date fair value of awards of equity instruments to employees. This expense is recognized over the period during which employees are required to provide service. The Company also estimates forfeitures.

COHEN & STEERS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(UNAUDITED)

~~Stock-based Compensation~~—The Company recognizes compensation expense for the grant-date fair value of awards of equity instruments granted to employees. This expense is recognized over the period during which employees are required to provide service. The Company also estimates forfeitures.

Income Taxes—The Company records the current and deferred tax consequences of all transactions that have been recognized in the condensed consolidated financial statements in accordance with the provisions of the enacted tax laws. Deferred tax assets are recognized for temporary differences that will result in deductible amounts in future years at tax rates that are expected to apply in those years. Deferred tax liabilities are recognized for temporary differences that will result in taxable income in future years at tax rates that are expected to apply in those years. The Company records a valuation allowance, when necessary, to reduce deferred tax assets to an amount that more likely than not will be realized. The effective tax rate for interim periods represents the Company’s best estimate of the effective tax rate expected to be applied to the full fiscal year.

Currency Translation and Transactions—Assets and liabilities of subsidiaries having non-U.S. dollar functional currencies are translated at exchange rates at the applicable condensed consolidated statement of financial condition date. Revenue and expenses of such subsidiaries are translated at average exchange rates during the period. The gains or losses resulting from translating non-U.S. dollar functional currency into U.S. dollars are included in the Company's condensed consolidated statements of comprehensive income. The cumulative translation adjustment was $(1,990,000) and $(1,446,000) as of June 30, 2015 and December 31, 2014, respectively. Gains or losses resulting from non-U.S. dollar currency transactions are included in other non-operating income in the condensed consolidated statements of operations. ~~The cumulative translation adjustment was $159,000 and $2,264,000 as of~~ ~~September 30, 2014~~ ~~and December 31, 2013, respectively.~~

Comprehensive Income—The Company reports all changes in comprehensive income in the condensed consolidated statements of comprehensive income. Comprehensive income includes net income or loss attributable to common stockholders, foreign currency translation gain and loss (net of tax), unrealized gain and loss from available-for-sale ~~securities~~investments (net of tax) and reclassification to statements of operations of gain and loss from available-for-sale ~~securities~~investments (net of tax).

Recently Issued Accounting Pronouncements—In ~~August 2014,~~May 2015, the Financial Accounting Standards Board ~~(“FASB”)~~(FASB) issued new guidance amending the current disclosure requirement for investments in certain entities that calculate net asset value per share. The guidance requires investments for which fair value is measured using the net asset value per share practical expedient be removed from the fair value hierarchy. Instead, those investment amounts shall be provided as a separate item to permit reconciliation of the fair value of investments included in the fair value hierarchy to the line items presented in the statement of financial position. This new guidance will be effective for the Company’s first quarter of 2016. The Company does not anticipate that the adoption of this new guidance will have a material impact on its condensed consolidated financial statements.

In February 2015, the FASB issued new guidance amending the current accounting for consolidation of certain legal entities. These amendments modify the evaluation of whether limited partnerships and similar legal entities are VIEs or voting interest entities, eliminate the presumption that a general partner should consolidate a limited partnership, affect the consolidation analysis of reporting entities that are involved with VIEs, particularly those that have fee arrangements and related party relationships, and provide a scope exception from consolidation guidance for reporting entities with interests in certain investment funds. This new guidance will be effective for the Company’s first quarter of 2016. The Company is currently evaluating the potential impact on its condensed consolidated financial statements and related disclosures.

In August 2014, the FASB issued new guidance regarding disclosure of going concern uncertainties in the financial statements. The guidance requires management to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the entity's ability to continue as a going concern within one year after the date that the financial statements are issued at each annual and interim reporting period. This new guidance will be effective for the Company’s first quarter of 2017. The Company does not anticipate that the adoption of this new guidance will have a material impact on ~~the Company's~~its condensed consolidated financial statements.

In May 2014, the FASB issued new guidance which outlined a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers. The core principle of the revenue model is that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This new guidance will be effective for the Company's first quarter of ~~2017~~2018 and requires either a retrospective or a modified retrospective approach to adoption. The Company is currently evaluating the potential impact on its condensed consolidated financial statements and related disclosures, as well as the available transition methods. Early application is prohibited.

In April 2014, the FASB issued new guidance which changed the requirements for reporting discontinued operations. A disposal of a component of an entity or a group of components of an entity is required to be reported in discontinued operations if the disposal represents a strategic shift that has (or will have) a major effect on an entity's operations and financial results. This new guidance will be effective for the Company's first quarter of 2015. The Company does not anticipate that the adoption of this new guidance will have a material impact on the Company's condensed consolidated financial statements.

In July 2013, the FASB issued new guidance on the presentation of unrecognized tax benefits when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. An entity is required to present an unrecognized tax benefit, or a portion of an unrecognized tax benefit, in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward unless a net operating loss carryforward, a similar

COHEN & STEERS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(UNAUDITED)

~~tax loss or a tax credit carryforward~~adoption. The Company is ~~not available as of~~currently evaluating the reporting date or the entity does not intend to use the deferred tax asset for this purpose (provided that the tax law permits a choice). This new guidance was effective for the Company's first quarter of 2014. The adoption of this new guidance did not have a materialpotential impact on ~~the Company's~~its condensed consolidated financial ~~statements.~~

~~In June 2013,~~statements and related disclosures, as well as the FASB issued new guidance which clarifies the characteristics of an investment company and provides guidance for assessing whether an entity is an investment company. From time to time the Company consolidates certain of its affiliated funds which are considered investment companies. The Company retains the specialized investment company accounting for such funds in consolidation. This new guidance was effective for the Company’s first quarter of 2014. The adoption of this new guidance did not have a material impact on the Company’s condensed consolidated financial statements.available transition methods.

3. Goodwill and Intangible Assets

Goodwill

Goodwill represents the excess of purchase price over the net tangible assets and identifiable intangible assets of an acquired business. At ~~September~~June 30, ~~2014~~2015 and December 31, ~~2013,~~2014, goodwill was approximately $~~19,611,000~~18,233,000 and $~~20,672,000~~19,120,000, respectively. The Company’s goodwill decreased by $~~1,061,000~~887,000 for the ~~nine~~six months ended ~~September~~June 30, ~~2014~~2015 as a result of foreign currency revaluation.

Intangible Assets

The following table details the gross carrying amounts and accumulated amortization for the intangible assets at ~~September~~June 30, ~~2014~~2015 and December 31, ~~2013~~2014 (in thousands):


	Remaining Amortization Period (in months)	Gross Carrying Amount		Accumulated Amortization			Intangible Assets, Net		Remaining Amortization Period (in months)	Gross Carrying Amount		Accumulated Amortization			Intangible Assets, Net
September 30, 2014:
June 30, 2015:
Amortized intangible assets:
Client relationships	51	$	1,543	$	(1,158	)	$	385	42	$	1,543	$	(1,225	)	$	318
Non-amortized intangible assets:
Mutual fund management contracts	—	1,250		—			1,250		—	1,250		—			1,250
Total		$	2,793	$	(1,158	)	$	1,635		$	2,793	$	(1,225	)	$	1,568
December 31, 2013:
December 31, 2014:
Amortized intangible assets:
Client relationships	60	$	1,543	$	(1,092	)	$	451	48	$	1,543	$	(1,181	)	$	362
Non-amortized intangible assets:
Mutual fund management contracts	—	1,250		—			1,250		—	1,250		—			1,250
Total		$	2,793	$	(1,092	)	$	1,701		$	2,793	$	(1,181	)	$	1,612

Amortization expense related to the intangible assets was approximately $22,000 for both the three months ended June 30, 2015 and 2014, respectively, and approximately $44,000 for both the six months ended June 30, 2015 and 2014, respectively. Estimated future amortization expense is as follows (in thousands):



Periods Ending December 31,	Estimated Amortization Expense
2015	$	45
2016	89
2017	89
2018	95
2019	—
Total	$	318

COHEN & STEERS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(UNAUDITED)

~~Amortization expense related to the intangible assets was approximately~~ ~~$22,000~~ ~~for both the three months ended~~ ~~September 30, 2014~~ ~~and~~ ~~2013, respectively, and approximately $66,000 for both the nine months ended~~ ~~September 30, 2014~~ ~~and~~ ~~2013, respectively. Estimated future amortization expense is as follows (in thousands):~~

Periods Ending December 31,
Estimated
Amortization
Expense
2014 $ 23
2015 89
2016 89
2017 89
2018 95
Thereafter —
Total $ 385

4. Investments

~~The following is a summary of the Company's investments as of~~ ~~September 30, 2014~~ ~~and December 31, 2013 (in thousands):~~

September 30,
2014 December 31, 2013
Securities owned $ 59,376
$ 15,668
Equity method investments 107
24,724
Investments, available-for-sale 21,814
10,449

~~Trading and equity method investments~~

The Cohen & Steers Active Commodities Strategy Fund, Inc. ~~(“CDF”)~~(CDF), which was launched by the Company in May 2014, is an open-end mutual fund for which the Company is the investment adviser. As of ~~September~~June 30, ~~2014~~2015, the Company owned the majority of the outstanding voting interest in CDF. Accordingly, the underlying assets and liabilities and results of operations of CDF have been included in the Company's condensed consolidated financial statements with the third-party interests classified as redeemable noncontrolling interest.

The Cohen & Steers ~~MLP & Energy Opportunity Fund, Inc. (“MLO”), which was launched by the Company in December 2013, is an open-end mutual fund for which the Company is the investment adviser. As of~~ ~~September 30, 2014~~, the Company owned the majority of the outstanding voting interest in MLO. Accordingly, the underlying assets and liabilities and results of operations of MLO have been included in the Company's condensed consolidated financial statements with the third-party interests classified as redeemable noncontrolling interest.

~~The Cohen & Steers~~ Active Commodities Fund, LP ~~(“ACOM”)~~(ACOM), launched by the Company in April 2013, is structured as a partnership. The Company is the investment adviser of ACOM for which it is entitled to receive a management fee. ~~As of~~ ~~September 30, 2014, the~~The Company owned all of the voting interest in ~~ACOM.~~ACOM through September 30, 2014. Accordingly, the underlying assets and liabilities and results of operations of ACOM ~~have~~had been included in the Company's condensed consolidated financial statements. As a result of third-party investments into the fund, effective October 1, 2014, the Company no longer held a controlling financial interest in ACOM. The Company determined that ACOM was not a VIE as the limited partners, unaffiliated with the Company, have the ability to liquidate the fund with a majority vote. As a result, the Company does not have financial control and ACOM is not consolidated into the Company's condensed consolidated financial statements. As the general partner, the Company has significant influence over the financial decisions of ACOM and therefore records its investment in ACOM using the equity method of accounting. The Company's equity interest in ACOM represents a seed investment to launch the fund, adjusted for the Company's proportionate share of the fund's earnings. As of June 30, 2015, the Company's ownership in ACOM was approximately 11%.

Cohen & Steers Global Realty Partners III-TE, L.P. ~~("GRP-TE")~~(GRP-TE), which had its closing in October 2011, is structured as a partnership. The Company is the general partner and investment adviser of GRP-TE, for which it receives a management fee and is entitled to receive an incentive distribution, if earned. GRP-TE is a VIE and the Company is not the primary beneficiary. As the general partner, the Company has significant influence over the financial decisions of GRP-TE and therefore records its investment using the equity method of accounting. The Company's equity interest in GRP-TE represents

~~COHEN & STEERS, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)~~

~~(UNAUDITED)~~

a seed investment to launch the fund, ~~which was made during the first quarter of 2012,~~ adjusted for the Company’s proportionate share of the fund’s earnings. As of ~~September~~June 30, ~~2014, the fair value of~~2015, the Company's ~~equity interest~~ownership in GRP-TE was approximately ~~$107,000~~0.2%. The Company's risk with respect to its investment in GRP-TE is limited to its equity ownership and any uncollected management fees. In conjunction with the launch of GRP-TE, the Company established Cohen & Steers Co-Investment Partnership, L.P. ~~(“GRP-CIP”)~~(GRP-CIP), which is used by the Company to fulfill its contractual commitment to co-invest with GRP-TE. See Note 11 for further discussion regarding the Company's co-investment commitment. As of ~~September~~June 30, ~~2014~~2015, the Company owned all of the voting interest in GRP-CIP. Accordingly, the underlying assets and liabilities and results of operations of GRP-CIP have been included in the Company's condensed consolidated financial statements.

~~Prior to~~The Cohen & Steers MLP & Energy Opportunity Fund, Inc. (MLO), which was launched by the Company in December 2013, is an open-end mutual fund for which the Company is the investment adviser. The Company owned the majority of the outstanding voting interest in MLO through October 31, 2014. Accordingly, the underlying assets and liabilities and results of operations of MLO had been included in the Company's condensed consolidated financial statements with the third-party interests classified as redeemable noncontrolling interest. During the period of November 1, 2014 through April 30, 2015, as a result of additional third-party subscriptions into the fund, the Company no longer owned the majority of the outstanding voting interest in MLO, however it was determined that the Company had significant influence over MLO and recorded its ~~liquidation~~investment in ~~April~~MLO using the equity method of accounting. Effective May 1, 2015, the Company's ownership interest in MLO fell below 20% and the Company no longer has significant influence over MLO. Accordingly, the Company began recording its investment in MLO as an available-for-sale investment.

Cohen & Steers Real Assets Fund, Inc. (RAP), which was launched by the Company on January 31, 2012, is an open-end mutual fund for which the Company is the investment adviser. During the period of August 1, 2013 through September 30, 2014, the Company did not hold a controlling financial interest in RAP, however it was determined that the Company had significant influence over RAP. Accordingly, the Company recorded its investment in RAP using the equity method of accounting. Effective September 30, 2014, the Company's ownership interest in RAP fell below 20% and the Company no

COHEN & STEERS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(UNAUDITED)

longer has significant influence over RAP. Accordingly, the Company began recording its investment in RAP as an available-for-sale investment.

The Company owned the majority of the voting interests in ~~the~~ Cohen & Steers Global Real Estate Long-Short Fund, L.P. (the ~~“Onshore Fund”).~~Onshore Fund) prior to its liquidation in April 2014. Accordingly, the underlying assets and liabilities and results of operations of the Onshore Fund had been included in the Company's condensed consolidated financial statements. The Onshore Fund was structured as a partnership and the Company was the general partner and investment adviser of the fund.

The Cohen & Steers Global Real Estate Long-Short Offshore Fund, L.P. (the ~~“Offshore Fund”)~~Offshore Fund), which was liquidated in April 2014, was structured as a partnership. The Company was the general partner and investment adviser of the Offshore Fund for which it received a management fee and was entitled to receive a performance fee, if earned. The Company determined that the Offshore Fund was not a ~~VIE. The~~VIE as the limited partners, unaffiliated with the Company, had the ability to dissolve the fund with a majority vote. As a result, the Company did not have financial control and the Offshore Fund was not consolidated into the Company's condensed consolidated financial statements. As the general partner, the Company had significant influence over the financial decisions of the Offshore Fund and therefore recorded its investment in this fund using the equity method of accounting. The Company’s equity interest in the Offshore Fund represented a seed investment to launch the fund, adjusted for the Company’s proportionate share of the fund’s earnings.

~~Cohen & Steers Real Assets Fund, Inc. ("RAP"),~~The following is a summary of the fair value of trading investments and equity method investments as of June 30, 2015 and December 31, 2014 (in thousands):



	June 30, 2015				December 31, 2014
	Trading Investments		Equity Method Investments		Trading Investments		Equity Method Investments
ACOM	$	—	$	7,337	$	—	$	7,612
CDF	6,400		—		7,000		—
GRP-CIP	2,463		—		2,509		—
GRP-TE	—		110		—		111
MLO	—		—		—		20,827
Total	$	8,863	$	7,447	$	9,509	$	28,550

Gain (loss) from trading investments—net for the three and six months ended June 30, 2015 and 2014, which ~~was launched~~represent realized and unrealized gains and losses recorded by the ~~Company in January 2012, is an open-end mutual fund for which~~funds the Company is the investment adviser. The Company had a controlling financial interest in RAP through July 31, 2013 and therefore, the underlying assets and liabilities and results of operations of RAP had been included in the Company's condensed consolidated financial statements with the third-party interests classified as redeemable noncontrolling interest. During the period of August 1, 2013 through September 30, 2014, as a result of additional third-party subscriptions into the fund, ~~the~~ Company no longer held a controlling financial interest in RAP, however it was determined that the Company had significant influence over RAP. Accordingly, the Company recorded its investment in RAP using the equity method of accounting. Effective September 30, 2014, the Company's ownership interest in RAP fellconsolidates, are summarized below ~~20% and the Company no longer has significant influence over RAP. Accordingly, the Company records its investment in RAP as investments, available-for-sale.~~(in thousands):



	Three Months Ended June 30,				Six Months Ended June 30,
	2015		2014		2015			2014
ACOM	$	—	$	279	$	—		$	816
CDF	163		46		(300		)	46
GRP-CIP	42		153		54			163
MLO	—		2,284		—			2,696
Onshore Fund	—		—		—			24
Total gain (loss) from trading investments—net	$	205	$	2,762	$	(246	)	$	3,745

COHEN & STEERS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(UNAUDITED)

~~The following is a summary of the fair value of securities owned and equity method investments as of~~ ~~September 30, 2014~~ ~~and December 31, 2013 (in thousands):~~

September 30, 2014 December 31, 2013
Securities Owned Equity Method Investments Securities Owned Equity Method Investments
ACOM $ 8,600
$ —
$ 7,300
$ —
CDF 9,600
—
—
—
GRP-CIP 2,416
—
2,740
—
GRP-TE —
107
—
116
MLO 38,760
—
5,125
—
Offshore Fund —
—
—
412
Onshore Fund —
—
503
—
RAP ⁽¹⁾
—
—
—
24,196
Total $ 59,376
$ 107
$ 15,668
$ 24,724

~~_________________________~~

(1) Effective September 30, 2014, the Company's ownership interest in RAP fell below 20% and the Company no longer has significant influence, therefore, the investment in RAP was reclassified to investments, available-for-sale.

~~Gain (loss) from trading securities—net for the~~ ~~three and nine~~ ~~months ended~~ ~~September 30, 2014~~ ~~and 2013, which represent realized and unrealized gains and losses recorded by the funds the Company consolidates, are summarized below (in thousands):~~

Three Months Ended
September 30, Nine Months Ended
September 30,
2014 2013 2014 2013
ACOM $ (1,321 ) $ 123
$ (505 ) $ (503 )
CDF (1,450 ) —
(1,404 ) —
GRP-CIP 5
287
168
264
MLO 76
—
2,772
—
Onshore Fund —
(104 ) 24
417
RAP —
2,077
—
(7,134 )
Total (loss) gain from trading securities—net $ (2,690 ) $ 2,383
$ 1,055
$ (6,956 )

Equity in earnings (losses) of affiliates for the three and ~~nine~~six months ended ~~September~~June 30, ~~2014~~2015 and ~~2013~~2014 are summarized below (in thousands):

Three Months Ended
September 30, Nine Months Ended
September 30,
2014
2013 2014 2013
GRP-TE $ —
$ 7
$ 20
$ 7
Offshore Fund 9
5
20
114
RAP ⁽¹⁾
(1,580 ) 301
753
301
Total equity in (losses) earnings of affiliates $ (1,571 ) $ 313
$ 793
$ 422

~~_________________________~~

~~COHEN & STEERS, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)~~

~~(UNAUDITED)~~

~~Available-for-sale~~



	Three Months Ended June 30,				Six Months Ended June 30,
	2015		2014		2015			2014
ACOM	$	163	$	—	$	(275	)	$	—
GRP-TE	1		—		3			20
MLO	921		—		276			—
Offshore Fund	—		—		—			11
RAP	—		1,429		—			2,333
Total equity in earnings of affiliates	$	1,085	$	1,429	$	4		$	2,364

The following is a summary of the cost, gross unrealized gains, gross unrealized losses and fair value of available-for-sale investments ~~available-for-sale~~ as of ~~September~~June 30, ~~2014~~2015 and December 31, ~~2013~~2014 (in thousands):


	September 30, 2014									June 30, 2015
	Cost		Gross Unrealized Gains		Gross Unrealized Losses ⁽¹⁾			Fair Value		Cost		Gross Unrealized Gains		Gross Unrealized Losses ⁽¹⁾			Fair Value
Preferred securities	$	1,017	$	45	$	(4	)	$	1,058	$	1,084	$	39	$	(5	)	$	1,118
Common stocks	5,230		779		(163		)	5,846		4,057		225		(270		)	4,012
Company-sponsored mutual funds	14,910		—		—			14,910		36,115		—		(2,825		)	33,290
Total investments, available-for-sale	$	21,157	$	824	$	(167	)	$	21,814
Total available-for-sale investments										$	41,256	$	264	$	(3,100	)	$	38,420

_________________________

(1) At ~~September~~June 30, ~~2014,~~2015, there were no securities with unrealized losses continuously for a period of more than 12 months.


	December 31, 2013									December 31, 2014
	Cost		Gross Unrealized Gains		Gross Unrealized Losses ⁽¹⁾			Fair Value		Cost		Gross Unrealized Gains		Gross Unrealized Losses ⁽¹⁾			Fair Value
Preferred securities	$	4,142	$	183	$	(40	)	$	4,285	$	1,043	$	54	$	(2	)	$	1,095
Common stocks	5,400		698		(132		)	5,966		5,366		627		(155		)	5,838
Company-sponsored mutual funds	197		1		—			198		15,010		4		(678		)	14,336
Total investments, available-for-sale	$	9,739	$	882	$	(172	)	$	10,449
Total available-for-sale investments										$	21,419	$	685	$	(835	)	$	21,269

_________________________

(1) At December 31, ~~2013,~~2014, there were no securities with unrealized losses continuously for a period of more than 12 months.

~~The aggregate~~Included in the total fair value of available-for-sale ~~securities~~investments was approximately $35,998,000 and $15,875,000 in an unrealized loss position ~~was approximately $2,481,000 and $1,785,000~~ at ~~September~~June 30, ~~2014~~2015 and December 31, ~~2013,~~2014, respectively.

Unrealized losses on available-for-sale investments ~~available-for-sale~~ as of ~~September~~June 30, ~~2014~~2015 were generally caused by market conditions. When evaluating whether an unrealized loss on an available-for-sale investment ~~available-for-sale~~ is other than temporary, the Company reviews such factors as the extent and duration of the loss, deterioration in the issuer’s credit quality, reduction or cessation of dividend payments and overall financial strength of the issuer. As of ~~September~~June 30, ~~2014~~2015, the Company determined that it had the ability and intent to hold the remaining investments for which no other-than-temporary impairment has occurred until a recovery of fair value. Accordingly, impairment of these investments is considered temporary.

~~Sales proceeds, gross realized gains and losses from investments, available-for-sale for the~~ ~~three and nine~~ ~~months ended~~ ~~September 30, 2014~~ ~~and 2013 are summarized below (in thousands):~~

Three Months Ended
September 30, Nine Months Ended
September 30,
2014 2013 2014 2013
Proceeds from sales $ 2,713
$ 3,570
$ 11,011
$ 21,326
Gross realized gains 775
283
2,024
1,846
Gross realized losses (15 ) (103 ) (136 ) (338 )

1514

COHEN & STEERS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(UNAUDITED)

Sales proceeds, gross realized gains and losses from available-for-sale investments for the three and six months ended June 30, 2015 and 2014 are summarized below (in thousands):



	Three Months Ended June 30,						Six Months Ended June 30,
	2015			2014			2015			2014
Proceeds from sales	$	3,226		$	1,548		$	4,616		$	8,298
Gross realized gains	495			143			664			1,249
Gross realized losses	(175		)	(91		)	(244		)	(121		)

5. Fair Value

Accounting Standards Codification Topic 820, Fair Value Measurement ~~(“ASC 820”)~~(ASC 820) specifies a hierarchy of valuation classifications based on whether the inputs to the valuation techniques used in each valuation classification are observable or unobservable. These classifications are summarized in the three broad levels listed below:

Level 1—Unadjusted quoted prices for identical instruments in active markets.

Level 2—Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable.

Level 3—Valuations derived from valuation techniques in which significant inputs or significant value drivers are unobservable.

Inputs used to measure fair value might fall in different levels of the fair value hierarchy, in which case the Company defaults to the lowest level input that is significant to the fair value measurement in its entirety. These levels are not necessarily an indication of the risk or liquidity associated with the investments. In determining the appropriate levels, the Company performed a detailed analysis of the assets and liabilities that are subject to ASC 820. Transfers among levels, if any, are recorded at the beginning of the reporting period. There were no transfers between level 1 and level 2 during the ~~nine~~six months ended ~~September~~June 30, ~~2014.~~2015.

COHEN & STEERS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(UNAUDITED)

The following table presents fair value measurements as of ~~September~~June 30, ~~2014~~2015 (in thousands):


	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Cash equivalents ⁽¹⁾	$	60,427	$	—	$	—	$	60,427	$	60,146	$	—	$	—	$	60,146
Securities owned
Common stocks	$	38,760	$	—	$	—	$	38,760
Trading investments
Fixed income securities	—		18,200		—		18,200		$	—	$	6,400	$	—	$	6,400
Limited partnership interests	—		—		2,416		2,416		—		—		2,463		2,463
Total securities owned	$	38,760	$	18,200	$	2,416	$	59,376
Total trading investments									$	—	$	6,400	$	2,463	$	8,863
Equity method investments	$	—	$	—	$	107	$	107	$	—	$	7,337	$	110	$	7,447
Investments, available-for-sale
Available-for-sale investments
Preferred securities	$	1,058	$	—	$	—	$	1,058	$	1,118	$	—	$	—	$	1,118
Common stocks	5,846		—		—		5,846		4,012		—		—		4,012
Company-sponsored mutual funds	14,910		—		—		14,910		33,290		—		—		33,290
Total investments, available-for-sale	$	21,814	$	—	$	—	$	21,814
Total available-for-sale investments									$	38,420	$	—	$	—	$	38,420
Derivatives - assets
Foreign exchange contracts	$	—	$	1,165	$	—	$	1,165	$	—	$	119	$	—	$	119
Commodity contracts	436		—		—		436		415		—		—		415
Total derivatives - assets	$	436	$	1,165	$	—	$	1,601	$	415	$	119	$	—	$	534
Derivatives - liabilities
Commodity contracts	$	1,816	$	—	$	—	$	1,816	$	403	$	—	$	—	$	403
Total derivatives - liabilities	$	1,816	$	—	$	—	$	1,816	$	403	$	—	$	—	$	403

_________________________

(1) Comprised of investments in actively traded money market ~~funds.~~funds measured at net asset value.

~~Securities owned~~Trading investments classified as level 2 in the above table were primarily comprised of investments in United States Treasury Bills carried at amortized cost, which approximates fair value.

~~COHEN & STEERS, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)~~

~~(UNAUDITED)~~

~~Securities owned~~Trading investments classified as level 3 in the above table were comprised of limited partnership interests which represent the Company's co-investments through GRP-CIP, which along with the Company's interest in GRP-TE, represent the Company's collective ownership interests in limited partnership vehicles that invest in non-registered real estate funds, which are valued based on the net asset values of the underlying funds, and private equity vehicles that invest directly in real estate which are generally valued using a discounted cash flow model.

Equity method investments classified as level 2 in the above table represent the carrying amount of the Company's partnership interest in ACOM, which approximates its fair value based on the fund's net asset value. ACOM invests in exchange-traded commodity futures contracts and other commodity related derivatives. The Company has the ability to redeem its investment in the fund monthly at net asset value per share with prior written notice of 5 days and there are no significant restrictions to redemption.

Equity method investments classified as level 3 in the above table represent the carrying amount of the Company's partnership interest in GRP-TE, which approximates its fair value based on the fund's net asset value. GRP-TE invests in non-registered real estate funds and in private equity vehicles that invest directly in real estate. As of ~~September~~June 30, ~~2014,~~2015, the Company did not have the ability to redeem its investment in GRP-TE.

COHEN & STEERS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(UNAUDITED)

The following table presents fair value measurements as of December 31, ~~2013~~2014 (in thousands):


	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Cash equivalents ⁽¹⁾	$	61,551	$	—	$	—	$	61,551	$	59,281	$	—	$	—	$	59,281
Securities owned
Common stocks	$	5,125	$	—	$	503	$	5,628
Trading investments
Fixed income securities	—		7,300		—		7,300		$	—	$	7,000	$	—	$	7,000
Limited partnership interests	—		—		2,740		2,740		—		—		2,509		2,509
Total securities owned	$	5,125	$	7,300	$	3,243	$	15,668
Total trading investment									$	—	$	7,000	$	2,509	$	9,509
Equity method investments	$	24,196	$	—	$	528	$	24,724	$	20,827	$	7,612	$	111	$	28,550
Investments, available-for-sale
Available-for-sale investments
Preferred securities	$	960	$	—	$	3,325	$	4,285	$	1,095	$	—	$	—	$	1,095
Common stocks	5,966		—		—		5,966		5,838		—		—		5,838
Company-sponsored mutual funds	198		—		—		198		14,336		—		—		14,336
Total investments, available-for-sale	$	7,124	$	—	$	3,325	$	10,449
Total available-for-sale investments									$	21,269	$	—	$	—	$	21,269
Derivatives - assets
Foreign exchange contracts	$	—	$	398	$	—	$	398	$	—	$	505	$	—	$	505
Commodity contracts	305		—		—		305		234		—		—		234
Total derivatives - assets	$	305	$	398	$	—	$	703	$	234	$	505	$	—	$	739
Derivatives - liabilities
Foreign exchange contracts									$	—	$	12	$	—	$	12
Commodity contracts	$	275	$	—	$	—	$	275	754		—		—		754
Total derivatives - liabilities	$	275	$	—	$	—	$	275	$	754	$	12	$	—	$	766

_________________________

(1) Comprised of investments in actively traded money market ~~funds.~~funds measured at net asset value.

~~Securities owned~~Trading investments classified as level 3 in the above table were comprised of investments in the common stock of a privately held bank holding company and limited partnership interests. The investments in the common stock of a privately held bank holding company were valued by the Company's valuation committee using a market approach which utilized market multiples derived from a set of comparable public companies. The limited partnership interests which represent the Company's co-investments through GRP-CIP, which along with the Company's interest in GRP-TE, represent the Company's collective ownership interests in limited partnership vehicles that invest in non-registered real estate funds, which are valued based on the net asset values of the underlying funds, and private equity vehicles that invest directly in real estate which are generally valued using a discounted cash flow model.

Equity method investments classified as level 2 in the above table represent the carrying amount of the Company's partnership interest in ACOM, which approximates its fair value based on the fund's net asset value. ACOM invests in exchange-traded commodity futures contracts and other commodity related derivatives. The ~~methodology used~~Company has the ability to redeem its investment in the fund monthly at net asset value ~~the investments held by GRP-CIP was changed during the year ended December 31, 2013 as the transaction cost was~~per share with prior written notice of 5 days and there are no ~~longer a reasonable approximation of value due~~significant restrictions to ~~the passage of time.~~redemption.

~~COHEN & STEERS, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)~~

~~(UNAUDITED)~~

Equity method investments classified as level 3 in the above table represent the carrying amount of the Company's partnership interests in ~~the Offshore Fund and~~ GRP-TE, which approximate ~~their~~its fair value based on ~~each~~the fund's net asset value. ~~The Offshore Fund made long and short investments in listed real estate equity securities to maximize absolute and risk-adjusted returns with modest volatility.~~ GRP-TE invests in non-registered real estate funds and in private equity vehicles that invest directly in real estate. As of December 31, ~~2013,~~2014, the Company did not have the ability to redeem its investment in ~~either fund.~~

Investments, available-for-sale classified as level 3 in the above table were comprised of an auction rate preferred security of a closed-end fund which was measured at fair value using a a third-party pricing service which utilized a combination of a market approach based on the quoted prices for identical or similar instruments in markets that are not active and an income approach in which the expected cash flows of the securities were discounted back to the measurement date. The Company reviewed the fair value provided by the pricing service and confirmed its understanding of the methodology utilized.

~~The following table summarizes the changes in level 3 investments measured at fair value on a recurring basis for the~~ ~~three and nine~~ ~~months ended~~ ~~September 30, 2014~~ ~~(in thousands):~~

Three Months Ended
September 30, 2014 Nine Months Ended
September 30, 2014

Securities
Owned
Equity Method Investments Investments, available-for-sale
Securities
Owned
Equity Method Investments Investments, available-for-sale
Common Stocks Limited Partnership Interests GRP-TE Preferred Securities Common Stocks Limited Partnership Interests GRP-TE/Offshore Fund Preferred Securities
Balance at beginning of period $ —
$ 2,378
$ 105
$ —
$ 503
$ 2,740
$ 528
$ 3,325
Purchases / contributions —
151
2
—
—
456
11
—
Sales / distributions —
—
—
—
(527 ) (721 ) (463 ) (4,000 )
Realized gains (losses) —
—
—
—
24
64
—
675
Unrealized gains (losses) ⁽¹⁾
—
(113 ) —
—
—
(123 ) 31
—
Transfers into (out of) level 3 —
—
—
—
—
—
—
—
Balance at end of period $ —
$ 2,416
$ 107
$ —
$ —
$ 2,416
$ 107
$ —

~~_________________________~~

~~(1) Pertains to unrealized gains (losses) from securities held at~~ ~~September 30, 2014~~.GRP-TE.

1817

COHEN & STEERS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(UNAUDITED)

The following table summarizes the changes in level 3 investments measured at fair value on a recurring basis for the three and ~~nine~~six months ended ~~September~~June 30, ~~2013~~2015 (in thousands):


	Three Months Ended September 30, 2013										Nine Months Ended September 30, 2013											Three Months Ended June 30, 2015					Six Months Ended June 30, 2015
	Securities Owned					Equity Method Investments			Investments, available-for-sale		Securities Owned						Equity Method Investments			Investments, available-for-sale		Trading Investments			Equity Method Investments		Trading Investments			Equity Method Investments
	Common Stocks		Limited Partnership Interests			GRP-TE/Offshore Fund			Preferred Securities		Common Stocks			Limited Partnership Interests			GRP-TE/Offshore Fund			Preferred Securities		Limited Partnership Interests			GRP-TE		Limited Partnership Interests			GRP-TE
Balance at beginning of period	$	413	$	2,210		$	96		$	3,092	$	1,168		$	2,142		$	89		$	3,080	$	2,445		$	109	$	2,509		$	111
Purchases / contributions	—		115			3			—		—			318			10			—		7			—		44			2
Sales / distributions	—		(28		)	(7,066		)	—		(419		)	(141		)	(7,066		)	—		(34		)	—		(147		)	(6		)
Realized gains (losses)	—		11			—			—		(211		)	11			—			—
Realized gains																						16			—		96			2
Unrealized gains (losses) ⁽¹⁾	11		275			12			262		(114		)	253			12			274		29			1		(39		)	1
Transfers into (out of) level 3	—		—			7,436			—		—			—			7,436			—		—			—		—			—
Balance at end of period	$	424	$	2,583		$	481		$	3,354	$	424		$	2,583		$	481		$	3,354	$	2,463		$	110	$	2,463		$	110

_________________________

(1) Pertains to unrealized gains (losses) from securities held at ~~September~~June 30, ~~2013~~2015.

The following table summarizes the changes in level 3 investments measured at fair value on a recurring basis for the three and six months ended June 30, 2014 (in thousands):



	Three Months Ended June 30, 2014										Six Months Ended June 30, 2014
	Trading Investments					Equity Method Investments			Available-for-sale investments		Trading Investments						Equity Method Investments			Available-for-sale investments
	Common Stocks		Limited Partnership Interests			GRP-TE/Offshore Fund			Preferred Securities		Common Stocks			Limited Partnership Interests			GRP-TE/Offshore Fund			Preferred Securities
Balance at beginning of period	$	—	$	2,251		$	537		$	—	$	503		$	2,740		$	528		$	3,325
Purchases / contributions	—		24			2			—		—			305			9			—
Sales / distributions	—		—			(434		)	—		(527		)	(721		)	(463		)	(4,000		)
Realized (losses) gains	—		(145		)	—			—		24			64			—			675
Unrealized gains (losses) ⁽¹⁾	—		248			—			—		—			(10		)	31			—
Transfers into (out of) level 3	—		—			—			—		—			—			—			—
Balance at end of period	$	—	$	2,378		$	105		$	—	$	—		$	2,378		$	105		$	—

_________________________

(1) Pertains to unrealized gains (losses) from securities held at June 30, 2014.

Realized gains (losses) from investments classified as ~~securities owned,~~trading investments, equity method investments and available-for-sale investments ~~available-for-sale~~ in the above tables were recorded as gain (loss) from trading ~~securities,~~investments, equity in earnings (losses) of affiliates and gain (loss) from available-for-sale ~~securities,~~investments, respectively, in the Company's condensed consolidated statements of operations. Unrealized gains (losses) from investments classified as ~~securities owned~~trading investments and equity method investments in the above tables were recorded as gain (loss) from trading ~~securities~~investments and equity in earnings (losses) of affiliates, respectively, in the Company's condensed consolidated statements of operations. Unrealized gains (losses) from available-for-sale investments ~~available-for-sale~~ in the above tables were recorded as unrealized gain (loss) from available-for-sale ~~securities~~investments in the Company's condensed consolidated statements of comprehensive income.

COHEN & STEERS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(UNAUDITED)

Valuation Techniques

In certain instances, debt and equity securities are valued on the basis of prices from an orderly transaction between market participants provided by reputable brokers/dealers or pricing services. In determining the value of a particular investment, pricing services may use information with respect to transactions in such investments, broker quotes, pricing matrices, market transactions in comparable investments and various relationships between investments. As part of its independent price verification process, the Company selectively performs detailed reviews of valuations provided by broker/dealers or pricing services. Investments in Company-sponsored mutual funds are valued at their closing net asset value.

Foreign exchange contracts are valued by interpolating a value using the spot foreign exchange rate and forward points (based on the spot rate and currency interest rate differentials), which are all inputs that are observable in active markets (level 2).

In the absence of observable market prices, the Company values its investments using valuation methodologies applied on a consistent basis. For some investments, little market activity may exist; management's determination of fair value is then based on the best information available in the circumstances, and may incorporate management's own assumptions and involves a significant degree of judgment, taking into consideration a combination of internal and external factors. Such investments are valued on a quarterly basis, taking into consideration any changes in key inputs and changes in economic and other relevant conditions, and valuation models are updated accordingly. The valuation process also includes a review by the Company's valuation committee which is ~~primarily~~ comprised of senior members from various departments within the Company, including investment management. The valuation committee provides independent oversight of the valuation policies and procedures.

~~COHEN & STEERS, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)~~

~~(UNAUDITED)~~

The valuation techniques and significant unobservable inputs used in the fair value measurement of the following level 3 investments as of ~~September~~June 30, ~~2014~~2015 were:

Fair Value Fair Value Significant
(in thousands) Methodology Unobservable Inputs Range
Limited partnership interests - direct investments in real estate $ 1,514
Discounted cash flows
Discount rate
Exit capitalization rates
Market rental rates
9% - 15%
8% - 8.5%
$15.00 - 18.50 psf



	Fair Value		Fair Value	Significant	Input /
	(in thousands)		Methodology	Unobservable Inputs	Range
Limited partnership interests - direct investments in real estate	$	1,419	Discounted cash flows	Discount rate Exit capitalization rates Market rental rates	9.5% - 15% 8% - 8.5% $15.00 - 17.00 psf

The valuation techniques and significant unobservable inputs used in the fair value measurement of the following level 3 investments as of December 31, ~~2013~~2014 were:

Fair Value Fair Value Significant Input /
(in thousands) Methodology Unobservable Inputs Range
Common shares of privately-held company $ 503
Market comparable companies
Price / tangible book ratio
Liquidity discount

1.48x
33%
Limited partnership interests - direct investments in real estate $ 2,101
Discounted cash flows
Discount rate
Exit capitalization rates
Market rental rates

9% - 15%
8.5% - 9%
$15.00 - 16.25 psf



	Fair Value		Fair Value	Significant	Input /
	(in thousands)		Methodology	Unobservable Inputs	Range
Limited partnership interests - direct investments in real estate	$	1,465	Discounted cash flows	Discount rate Exit capitalization rates Market rental rates	9% - 15% 8% - 8.5% $15.00 - 17.00 psf

Changes in the significant unobservable inputs in the tables above may result in a materially higher or lower fair value measurement. The disclosure in the above tables excludes the Company's ownership interests in limited partnership vehicles which are valued based on the net asset values of the underlying funds. The disclosure in the above table as of December 31, 2013 also excludes auction rate preferred securities for which fair value is based on unobservable but non-quantitative inputs. Such items include financial instruments for which the determination of fair value is based on unadjusted quotations provided by a third-party pricing service.

COHEN & STEERS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(UNAUDITED)

6. Derivatives

The following is a summary of the notional and fair value of the derivative financial instruments. The notional amount represents the absolute value amount of all outstanding derivative contracts at ~~September~~June 30, ~~2014~~2015 (in thousands):


	September 30, 2014								June 30, 2015
	Assets				Liabilities				Assets				Liabilities
	Notional		Fair Value		Notional		Fair Value		Notional		Fair Value		Notional		Fair Value
Total foreign exchange contracts	$	17,090	$	1,165	$	—	$	—	$	11,676	$	119	$	—	$	—
Total commodity contracts	9,500		436		23,838		1,816		5,108		415		8,475		403
Total derivatives	$	26,590	$	1,601	$	23,838	$	1,816	$	16,784	$	534	$	8,475	$	403


	December 31, 2013								December 31, 2014
	Assets				Liabilities				Assets				Liabilities
	Notional		Fair Value		Notional		Fair Value		Notional		Fair Value		Notional		Fair Value
Total foreign exchange contracts	$	10,853	$	398	$	—	$	—	$	11,349	$	505	$	222	$	12
Total commodity contracts	8,115		305		5,738		275		6,095		234		8,977		754
Total derivatives	$	18,968	$	703	$	5,738	$	275	$	17,444	$	739	$	9,199	$	766

~~COHEN & STEERS, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)~~

~~(UNAUDITED)~~

Cash included in due from broker in the condensed consolidated statement of financial condition of approximately $~~1,389,000~~85,000 and $~~2,110,000~~422,000 as of ~~September~~June 30, ~~2014~~2015 and December 31, ~~2013,~~2014, respectively, was held as collateral for futures contracts. Securities included in ~~securities owned~~trading investments in the condensed consolidated statement of financial condition of approximately $~~9,454,000~~653,000 and $~~7,300,000~~650,000 as of ~~September~~June 30, ~~2014~~2015 and December 31, ~~2013,~~2014, respectively, were held as collateral for futures contracts.

Gains and losses from derivative financial instruments for the three and ~~nine~~six months ended ~~September~~June 30, ~~2014~~2015 and ~~2013~~2014 are summarized below (in thousands):


	Three Months Ended September 30,						Nine Months Ended September 30,						Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013			2015			2014			2015			2014
Equity contracts	$	—		$	—		$	—		$	(584	)
Foreign exchange contracts	1,275			(105		)	767			1,224			$	(445	)	$	(340	)	$	(374	)	$	(508	)
Commodity contracts	(2,221		)	1,087			(1,871		)	(2,753		)	164			(198		)	(301		)	350
Credit contracts	—			—			—			(21		)
Total derivatives	$	(946	)	$	982		$	(1,104	)	$	(2,134	)	$	(281	)	$	(538	)	$	(675	)	$	(158	)

7. Earnings Per Share

Basic earnings per share ~~are~~is calculated by dividing net income attributable to common stockholders by the weighted average shares outstanding. Diluted earnings per share ~~are~~is calculated by dividing net income attributable to common stockholders by the total weighted average shares of common stock outstanding and common stock equivalents. Common stock equivalents are comprised of dilutive potential shares from restricted stock unit awards. Common stock equivalents are excluded from the computation if their effect is anti-dilutive. Diluted earnings per share are computed using the treasury stock method.

COHEN & STEERS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(UNAUDITED)

Anti-dilutive common stock equivalents of approximately 17,000 and 8,000 shares, respectively, were excluded from the computation for the three and six months ended June 30, 2015. No anti-dilutive common stock equivalents were excluded from the computation for the three and ~~nine~~six months ended ~~September~~June 30, ~~2014~~ ~~and 2013.~~2014.

The following is a reconciliation of the income and share data used in the basic and diluted earnings per share computations for the three and ~~nine~~six months ended ~~September~~June 30, ~~2014~~2015 and ~~2013~~2014 (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,
	2014		2013			2014			2013		2015			2014			2015		2014
Net income	$	18,037	$	19,817		$	60,561		$	43,827	$	20,774		$	22,924		$	41,545	$	42,524
Less: Net loss (income) attributable to redeemable noncontrolling interest	147		(1,534		)	(749		)	4,879
Less: Net (income) loss attributable to redeemable noncontrolling interest											(11		)	(741		)	34		(896		)
Net income attributable to common stockholders	$	18,184	$	18,283		$	59,812		$	48,706	$	20,763		$	22,183		$	41,579	$	41,628
Basic weighted average shares outstanding	44,839		44,317			44,766			44,254		45,462			44,825			45,352		44,730
Dilutive potential shares from restricted stock units	850		789			802			743		343			705			541		777
Diluted weighted average shares outstanding	45,689		45,106			45,568			44,997		45,805			45,530			45,893		45,507
Basic earnings per share attributable to common stockholders	$	0.41	$	0.41		$	1.34		$	1.10	$	0.46		$	0.49		$	0.92	$	0.93
Diluted earnings per share attributable to common stockholders	$	0.40	$	0.41		$	1.31		$	1.08	$	0.45		$	0.49		$	0.91	$	0.91

~~COHEN & STEERS, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)~~

~~(UNAUDITED)~~

8. Income Taxes

The provision for income taxes ~~for the~~ ~~nine~~ ~~months ended~~ ~~September 30, 2014~~includes U.S. federal, state, local and foreign ~~taxes at an approximate~~taxes. For the three months ended June 30, 2015 and June 30, 2014, the effective tax rate of ~~36%~~.was approximately 37.0% and 34.6%, respectively. The effective tax rate for the three months ended ~~September~~June 30, 2014 ~~was approximately 37.1%, which reflects~~included the cumulative effect to adjust the estimated tax rate to ~~36%~~35.5% for the full year 2014. The effective tax rate for the ~~nine~~six months ended ~~September~~June 30, ~~2013~~2015 and June 30, 2014 was approximately ~~37.5%~~37.0% and 35.5%, which included discrete items, the most significant of which was attributable to the launch costs of MIE during the first quarter of 2013. Excluding the discrete items, the effective tax rate for the nine months ended ~~September 30, 2013~~ ~~was approximately 38%. The effective tax rate for the three months ended~~ ~~September 30, 2013~~ ~~was approximately 38%.~~respectively. The Company expects the tax rate for the full year ~~2014~~2015 to approximate ~~36%~~37.0%, excluding discrete items.

Deferred income taxes represent the tax effects of the temporary differences between book and tax bases and are measured using enacted tax rates that will be in effect when such items are expected to reverse. The Company's net deferred tax asset is primarily comprised of future income tax deductions attributable to the delivery of unvested restricted stock units. The Company records a valuation allowance, when necessary, to reduce deferred tax assets to an amount that more likely than not will be realized.

9. Regulatory Requirements

CSS, a registered broker/dealer in the U.S., is subject to the SEC’s Uniform Net Capital Rule 15c3-1 (the ~~“Rule”)~~Rule), which requires that broker/dealers maintain a minimum level of net capital, as prescribed under the Rule. As of ~~September~~June 30, ~~2014~~2015, CSS had net capital of approximately ~~$1,846,000,~~$1,078,000, which exceeded its requirements by approximately ~~$1,666,000.~~$897,000. The Rule also provides that equity capital may not be withdrawn or cash dividends paid if the resulting net capital of a broker/dealer is less than the amount required under the Rule and requires prior notice to the SEC for certain withdrawals of capital.

CSS does not carry customer accounts and is exempt from ~~the SEC’s~~SEC Rule 15c3-3 pursuant to provisions (k)(1) and (k)(2)(i) of such rule.

~~Certain of the non-U.S. subsidiaries of the Company (collectively, the “Foreign Regulated Entities”)~~

COHEN & STEERS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(UNAUDITED)

CSAL and CSUK are regulated outside the U.S. by the Hong Kong Securities and Futures Commission and the United Kingdom Financial Conduct ~~Authority.~~Authority, respectively. As of ~~September~~June 30, ~~2014, the Foreign Regulated Entities~~2015, CSAL and CSUK had aggregate regulatory capital of approximately ~~$52,296,000,~~$66,705,000, which exceeded aggregate regulatory capital requirements by approximately ~~$50,588,000.~~$63,990,000.

10. Related Party Transactions

The Company is an investment adviser to, and has administrative agreements with, affiliated funds for which certain employees are officers and/or directors. The following table sets forth the amount of revenue the Company earned from these affiliated funds for the three and ~~nine~~six months ended ~~September~~June 30, ~~2014~~2015 and ~~2013~~2014 (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,				Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013		2015		2014		2015		2014
Investment advisory and administration fees	$	54,789	$	48,264	$	155,201	$	141,792	$	55,839	$	52,275	$	111,948	$	100,412
Distribution and service fees	3,738		3,627		10,952		10,802		4,014		3,744		7,920		7,214
	$	58,527	$	51,891	$	166,153	$	152,594	$	59,853	$	56,019	$	119,868	$	107,626

~~COHEN & STEERS, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)~~

~~(UNAUDITED)~~

Sales proceeds, gross realized gains, gross realized losses and dividend income from available-for-sale investments ~~available-for-sale~~ in Company-sponsored mutual funds for the three and ~~nine~~six months ended ~~September~~June 30, ~~2014~~2015 and ~~2013~~2014 are summarized below (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,					Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014			2013		2015		2014		2015		2014
Proceeds from sales	$	—	$	102	$	192		$	10,715	$	—	$	—	$	—	$	192
Gross realized gains	—		2		—			615		—		—		—		—
Gross realized losses	—		—		(3		)	—		—		—		—		(3		)
Dividend income	—		—		—			—		300		—		300		—

The Company has agreements with certain affiliated open-end mutual funds and closed-end ~~mutual~~ funds to reimburse certain fund expenses. For the three months ended ~~September~~June 30, ~~2014~~2015 and ~~2013~~2014, expenses of approximately $~~2,042,000~~2,084,000 and $~~2,629,000~~2,423,000, respectively, were incurred by the Company pursuant to these agreements and are included in general and administrative expenses. For the ~~nine~~six months ended ~~September~~June 30, ~~2014~~2015 and ~~2013~~2014, expenses of approximately $~~6,581,000~~4,478,000 and $~~7,353,000~~4,539,000, respectively, were incurred.

Included in accounts receivable at ~~September~~June 30, ~~2014~~2015 and December 31, ~~2013~~2014 are receivables due from Company-sponsored mutual funds of approximately $~~19,232,000~~19,514,000 and $~~18,026,000~~19,750,000, respectively.

11. Commitments and Contingencies

From time to time, the Company is involved in legal matters relating to claims arising in the ordinary course of business. There are currently no such matters pending that the Company believes could have a material adverse effect on its condensed consolidated results of operations, cash flows or financial position.

The Company periodically commits to fund a portion of the equity in certain of its sponsored investment products. The Company has committed to co-invest up to $5.1 million alongside GRP-TE, a portion of which is made through GRP-TE and the remainder of which is made through GRP-CIP for up to 12 years through the life of GRP-TE. As of ~~September~~June 30, ~~2014~~2015, the Company has funded approximately ~~$3.0~~$3.2 million with respect to this commitment. The actual timing offor funding the ~~funding~~unfunded portion of this commitment is currently unknown, as the drawdown of the Company's unfunded commitment is contingent on the timing of drawdowns by the underlying funds and co-investments in which GRP-TE invests. ~~This~~The unfunded

COHEN & STEERS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(UNAUDITED)

commitment was not recorded on the Company's condensed consolidated statements of financial condition as of ~~September~~June 30, ~~2014~~2015.

12. Concentration of Credit Risk

The Company's cash and cash equivalents are principally on deposit with three major financial institutions. The Company is subject to credit risk should these financial institutions be unable to fulfill their obligations.

13. Subsequent Events

The Company has evaluated the need for disclosures and/or adjustments resulting from subsequent events through the date the condensed consolidated financial statements were issued. Other than the items described below, the Company determined that there were no additional subsequent events that require disclosure and/or adjustment.

On ~~November 4, 2014,~~August 6, 2015, CNS declared a quarterly ~~and special cash dividends~~dividend on its common stock in the amount of ~~$0.22 and $1.00~~$0.25 per ~~share, respectively. These dividends~~share. The dividend will be payable on ~~December 19, 2014~~September 24, 2015 to stockholders of record at the close of business on ~~November 28, 2014.~~

September 3, 2015.

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

Set forth on the following pages is management’s discussion and analysis of our financial condition and results of operations for the three and ~~nine~~six months ended ~~September~~June 30, ~~2014~~2015 and ~~September~~June 30, ~~2013~~2014. Such information should be read in conjunction with our condensed consolidated financial statements ~~along with~~and the notes to the condensed consolidated financial statements included herein. The condensed consolidated financial statements of the Company included herein are unaudited. When we use the terms “Cohen & Steers,” the “Company,” “we,” “us,” and “our,” we mean Cohen & Steers, Inc., a Delaware corporation, and its consolidated subsidiaries.

Executive Overview

General

We are a global investment manager specializing in liquid real assets, including real estate securities, listed infrastructure, commodities and natural resource equities, as well as preferred securities and other income solutions. Founded in 1986, we are ~~a leading~~headquartered in New York City, with offices in London, Hong Kong, Tokyo and Seattle.

Our primary investment strategies include U.S. and global/international real estate securities, global ~~investment manager with a long history of innovation~~listed infrastructure, Master Limited Partnerships (MLPs) and ~~a focus on~~midstream energy, commodities, natural resource equities, multi-strategy real assets, preferred securities and large cap value. Our strategies encompass a diversity of investment objectives and risk profiles and are actively managed by specialist teams of investment professionals who employ fundamental-driven research and portfolio management processes. We offer our strategies through a variety of investment vehicles, including ~~real estate, infrastructure~~U.S. registered mutual funds and ~~commodities. We serve institutional~~other commingled vehicles and ~~individual investors~~separate accounts, including sub-advised portfolios for financial institutions around the world.

Our products and services are marketed and offered through multiple distribution channels. We distribute our U.S. registered mutual funds principally through financial intermediaries, including broker/dealers, registered investment advisers, banks and fund supermarkets. Our institutional clients include corporate and public pension plans, endowment funds and foundations and insurance companies that access our investment management services directly or through consultants.

Our revenue is derived from investment advisory fees received from our clients, including fees for managing or sub-advising separate accounts, and investment advisory, administration, distribution and service fees received from our sponsored open-end mutual funds and closed-end funds. Our fees are based on contractually specified percentages of the value of the assets we manage. Our revenue fluctuates with changes in the total value of our assets under management, which may occur as a result of our investment decisions, market conditions, foreign currency fluctuations, or investor subscriptions or redemptions, and is recognized over the period that the assets are managed.

Quarterly Highlights

Revenue decreased 0.4% from the first quarter of 2015 to $83.5 million for the second quarter of 2015. The decrease in revenue was primarily attributable to lower average assets under management in all three account types. Operating income decreased 9.8% from the first quarter of 2015 to $31.2 million for the second quarter of 2015. Operating margin decreased to 37.3% for the second quarter of 2015 compared with 41.2% for the first quarter of 2015. Our effective tax rate was 37% for the second quarter of 2015.

Assets under management decreased by $4.5 billion, or 8.3%, in the second quarter of 2015 to $50.1 billion as of June 30, 2015, driven by market depreciation combined with net outflows. Average assets under management decreased by 3.1% during the second quarter of 2015 to $53.3 billion. Our annualized organic decay rate for open-end mutual funds was 10% which, combined with our annualized organic decay rate of 4% for institutional accounts, resulted in an overall annualized organic decay rate of 5% for the second quarter of 2015. Organic growth/decay rates represent the ratio of annualized net flows for the quarter to the beginning assets under management.

Business Developments

During the second quarter of 2015, we were awarded our largest global listed infrastructure mandate to date of $450 million; this mandate will be funded in stages beginning in the second half of 2015. In addition, Argo Global Listed Infrastructure Limited, an Australian listed investment company that we sub-advise (AGLI), was successfully launched on July 1, 2015 and funded with $214 million, net of underwriter commissions, and has the potential to grow further through March 31, 2017, subject to market conditions affecting AGLI's shareholders' outstanding options.

Assets Under Management

We manage three types of accounts: institutional accounts, open-end mutual funds and closed-end ~~mutual~~ funds.

The following table sets forth information regarding the net flows and appreciation/(depreciation) of assets under management for the periods presented (in millions):


	Three Months Ended September 30,						Nine Months Ended September 30,						Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013			2015			2014			2015			2014
Institutional Accounts
Assets under management, beginning of period	$	25,728		$	24,538		$	22,926		$	24,850		$	26,704		$	24,479		$	26,201		$	22,926
Inflows	893			91			1,700			614			481			375			1,098			807
Outflows	(1,962		)	(1,395		)	(3,510		)	(3,351		)	(749		)	(896		)	(1,984		)	(1,548		)
Net outflows	(1,069		)	(1,304		)	(1,810		)	(2,737		)	(268		)	(521		)	(886		)	(741		)
Market (depreciation) appreciation	(831		)	57			2,712			1,178			(1,891		)	1,770			(770		)	3,543
Transfers *	113			—			113			—
Total (decrease) increase	(1,787		)	(1,247		)	1,015			(1,559		)	(2,159		)	1,249			(1,656		)	2,802
Assets under management, end of period	$	23,941		$	23,291		$	23,941		$	23,291		$	24,545		$	25,728		$	24,545		$	25,728
Average assets under management for period	$	24,944		$	23,729		$	24,608		$	25,061		$	25,942		$	25,010		$	26,508		$	24,437

Open-end Mutual Funds
Assets under management, beginning of period	$	16,629		$	14,442		$	14,016		$	12,962		$	18,062		$	15,148		$	17,131		$	14,016
Inflows	1,542			1,121			4,529			4,418			1,307			1,464			2,949			2,987
Outflows	(1,439		)	(1,167		)	(3,807		)	(3,446		)	(1,761		)	(949		)	(3,236		)	(2,368		)
Net inflows (outflows)	103			(46		)	722			972
Net (outflows) inflows													(454		)	515			(287		)	619
Market (depreciation) appreciation	(503		)	(134		)	1,491			328			(1,372		)	966			(608		)	1,994
Transfers *	(113		)	—			(113		)	—
Total (decrease) increase	(513		)	(180		)	2,100			1,300			(1,826		)	1,481			(895		)	2,613
Assets under management, end of period	$	16,116		$	14,262		$	16,116		$	14,262		$	16,236		$	16,629		$	16,236		$	16,629
Average assets under management for period	$	16,768		$	14,385		$	15,797		$	14,397		$	17,514		$	15,992		$	17,737		$	15,303

Closed-end Mutual Funds
Closed-end Funds
Assets under management, beginning of period	$	9,928		$	8,843		$	8,965		$	7,985		$	9,900		$	9,404		$	9,805		$	8,965
Inflows	—			—			—			739			—			—			—			—
Outflows	—			—			—			—			(19		)	—			(19		)	—
Net inflows	—			—			—			739
Net outflows													(19		)	—			(19		)	—
Market (depreciation) appreciation	(290		)	(60		)	673			59			(514		)	524			(419		)	963
Total (decrease) increase	(290		)	(60		)	673			798			(533		)	524			(438		)	963
Assets under management, end of period	$	9,638		$	8,783		$	9,638		$	8,783		$	9,367		$	9,928		$	9,367		$	9,928
Average assets under management for period	$	9,922		$	8,864		$	9,630		$	8,723		$	9,832		$	9,719		$	9,905		$	9,482

Total
Assets under management, beginning of period	$	52,285		$	47,823		$	45,907		$	45,797		$	54,666		$	49,031		$	53,137		$	45,907
Inflows	2,435			1,212			6,229			5,771			1,788			1,839			4,047			3,794
Outflows	(3,401		)	(2,562		)	(7,317		)	(6,797		)	(2,529		)	(1,845		)	(5,239		)	(3,916		)
Net outflows	(966		)	(1,350		)	(1,088		)	(1,026		)	(741		)	(6		)	(1,192		)	(122		)
Market (depreciation) appreciation	(1,624		)	(137		)	4,876			1,565			(3,777		)	3,260			(1,797		)	6,500
Total (decrease) increase	(2,590		)	(1,487		)	3,788			539			(4,518		)	3,254			(2,989		)	6,378
Assets under management, end of period	$	49,695		$	46,336		$	49,695		$	46,336		$	50,148		$	52,285		$	50,148		$	52,285
Average assets under management for period	$	51,634		$	46,978		$	50,035		$	48,181		$	53,288		$	50,721		$	54,150		$	49,222

~~_________________________~~

* Represents transfer of assetsAssets under management ~~not related~~were $50.1 billion at June 30, 2015, a decrease of 4% from $52.3 billion at June 30, 2014. The decrease was due to ~~subscriptions, redemptions or~~net outflows of $3.0 billion, partially offset by market appreciation ~~(depreciation).~~of $815 million for the twelve

~~Assets under management were~~ ~~$49.7 billion~~ at ~~September~~months ended June 30, ~~2014, an increase of 7% from~~ ~~$46.3 billion~~ at ~~September 30, 2013. The increase was due to market appreciation of $5.4 billion, including $3.1~~2015. Net outflows included $3.0 billion from U.S. real estate, ~~$706~~$975 million ~~from global/international real estate and $684 million from global listed infrastructure, partially offset by net outflows of $2.0 billion, including net outflows of $2.5 billion~~ from large cap value and ~~$659~~$738 million from global/international real estate, partially offset by net inflows of ~~$556 million~~$1.0 billion into preferred securities and ~~$458~~$286 million into global listed ~~infrastructure for the twelve months ended September 30, 2014.~~infrastructure. Market appreciation included $1.2 billion from U.S. real estate and $231 million from global/international real estate, partially offset by market depreciation of $480 million from global listed infrastructure.

Average assets under management ~~was~~were $~~51.6~~53.3 billion for the three months ended ~~September~~June 30, 2015, an increase of 5% from $50.7 billion for the three months ended June 30, 2014. Average assets under management were $54.2 billion for the six months ended June 30, 2015, an increase of 10% from $~~47.0~~49.2 billion for the ~~three~~six months ended ~~September~~June 30, ~~2013. Average assets under management was $50.0 billion for the nine months ended~~ ~~September 30,~~ 2014~~, an increase of~~ 4% ~~from~~ ~~$48.2 billion~~ ~~for the nine months ended~~ ~~September 30, 2013~~.

Institutional accounts

~~Institutional accounts assets~~Assets under management in institutional accounts were $~~23.9~~24.5 billion at ~~September~~June 30, ~~2014~~2015, ~~an increase~~a decrease of 3%5% from $~~23.3~~25.7 billion at ~~September~~June 30, ~~2013~~2014. The ~~increase~~decrease in assets under management for the twelve months ended June 30, 2015 was due to net outflows of $2.2 billion, partially offset by market appreciation of ~~$3.0 billion, including $1.7~~$927 million. Net outflows included $1.5 billion from U.S. real estate, ~~$603 million from global/international real estate and $448~~$978 million from large cap value ~~partially offset by net outflows of $2.5 billion, including $2.5 billion from large cap value~~ and ~~$522~~$412 million from global/international real estate, partially offset by net inflows of ~~$317~~$334 million into commodities, ~~and $294~~$134 million into global listed infrastructure and $131 million into preferred securities. Market appreciation included $786 million from U.S. real estate and $220 million from global/international real estate.

Average assets under management for institutional accounts were $25.9 billion for the three months ended June 30, 2015, an increase of 4% from $25.0 billion for the three months ended June 30, 2014. Average assets under management were $26.5 billion for the six months ended June 30, 2015, an increase of 8% from $24.4 billion for the six months ended June 30, 2014.

Assets under management in institutional accounts from subadvisory relationships were $17.5 billion at June 30, 2015, a decrease of 6% from $18.6 billion at June 30, 2014. The decrease in assets under management for the twelve months ended ~~September~~June 30, 2015 was due to net outflows of $1.7 billion, partially offset by market appreciation of $649 million. Net outflows included $1.3 billion from U.S. real estate, $854 million from large cap value and $286 million from global/international real estate, partially offset by net inflows of $296 million into preferred securities, $272 million into commodities and $189 million into global listed infrastructure. Market appreciation included $592 million from U.S. real estate and $151 million from global/international real estate, partially offset by market depreciation of $121 million from commodities.

Average assets under management for institutional accounts from subadvisory relationships were $18.6 billion for the three months ended June 30, 2015, an increase of 3% from $18.1 billion for the three months ended June 30, 2014. Average assets under management were $19.1 billion for the six months ended June 30, 2015, an increase of 7% from $17.8 billion for the six months ended June 30, 2014.

Assets under management in institutional accounts from advisory relationships were $7.0 billion at June 30, 2015, a decrease of 2% from $7.2 billion at June 30, 2014. The decrease in assets under management for the twelve months ended June 30, 2015 was due to net outflows of $539 million, partially offset by market appreciation of $278 million. Net outflows included $220 million from U.S. real estate, $165 million from preferred securities, $127 million from global/international real estate and $124 million from large cap value, partially offset by net inflows of $84 million into natural resource equities. Market appreciation included $193 million from U.S. real estate and $69 million from global/international real estate.

Average assets under management for institutional accounts ~~was~~from advisory relationships were $7.4 billion for the three months ended June 30, 2015, an increase of 7% from $6.9 billion for the three months ended June 30, 2014. Average assets under management were $7.5 billion for the six months ended June 30, 2015, an increase of 12% from $6.6 billion for the six months ended June 30, 2014.

Open-end mutual funds

Assets under management in open-end mutual funds were $~~24.9~~16.2 billion at June 30, 2015, a decrease of 2% from $16.6 billion at June 30, 2014. The decrease in assets under management for the twelve months ended June 30, 2015 was due to net outflows of $710 million, partially offset by market appreciation of $430 million. Net outflows included $1.5 billion from U.S. real estate and $325 million from global/international real estate, partially offset by net inflows of $903 million into preferred securities and $162 million into global listed infrastructure. Market appreciation included $428 million from U.S. real estate.

Average assets under management for open-end mutual funds were $17.5 billion for the three months ended ~~September~~June 30, ~~2014~~2015, an increase of 5%10% from $~~23.7~~16.0 billion for the three months ended ~~September~~June 30, ~~2013~~2014. Average assets under management ~~was $24.6~~were $17.7 billion for the ~~nine~~six months ended ~~September~~June 30, 2015, an increase of 16% from $15.3 billion for the six months ended June 30, 2014.

Closed-end funds

Assets under management in closed-end funds were $9.4 billion at June 30, 2015, a decrease of 2%6% from $~~25.1~~9.9 billion at June 30, 2014. The decrease in assets under management for the ~~nine~~twelve months ended ~~September~~June 30, ~~2013~~.2015 was primarily due to market depreciation of $542 million.

~~Net outflows from institutional accounts~~Average assets under management for closed-end funds were $~~1.1~~9.8 billion for the three months ended ~~September~~June 30, ~~2014~~2015, ~~compared with~~an increase of 1% from $~~1.3~~9.7 billion for the three months ended ~~September 30, 2013. Gross inflows were~~ ~~$893 million~~ ~~for the~~ ~~three~~ ~~months ended~~ ~~September~~June 30, 2014~~, compared with~~ ~~$91 million~~ ~~for the~~ ~~three~~ ~~months ended~~ ~~September 30, 2013~~. ~~Gross outflows totaled~~ ~~$2.0 billion~~ ~~for the~~ ~~three~~ ~~months ended~~ ~~September 30, 2014, compared with~~ ~~$1.4 billion~~ ~~for the~~ ~~three~~ ~~months ended~~ ~~September 30, 2013. Market depreciation was~~ ~~$831 million~~ ~~for the~~ ~~three~~ ~~months ended~~ ~~September 30, 2014, compared with market appreciation of~~ ~~$57 million~~ ~~for the~~ ~~three~~ ~~months ended~~ ~~September 30, 2013~~.

~~Net outflows from institutional accounts were $1.8 billion for the nine months ended~~ ~~September 30, 2014, compared with $2.7 billion for the nine months ended~~ ~~September 30, 2013. Gross inflows were $1.7 billion for the nine months ended~~ ~~September 30, 2014, compared with $614 million for the nine months ended~~ ~~September 30, 2013. Gross outflows totaled $3.5 billion for the nine months ended~~ ~~September 30, 2014, compared with $3.4 billion for the nine months ended~~ ~~September 30, 2013. Market appreciation was $2.7 billion for the nine months ended~~ ~~September 30, 2014, compared with $1.2 billion for the nine months ended~~ ~~September 30, 2013~~.

~~Open-end mutual funds~~

~~Open-end mutual funds~~Average assets under management were $9.9 billion for the six months ended ~~$16.1 billion~~ at ~~September~~June 30, ~~2014~~2015, an increase of ~~13%~~4% from $~~14.3 billion~~ at ~~September 30, 2013~~. The increase in assets under management was due to market appreciation of $1.5 billion, including $1.1 billion from U.S. real estate and $198 million from preferred securities, and net inflows of $452 million, including $452 million into preferred securities, $123 million into multi-strategy real assets and $122 million into global listed infrastructure, partially offset by net outflows of $137 million from global/international real estate for the twelve months ended ~~September 30, 2014~~.

~~Average assets under management for open-end mutual funds was~~ ~~$16.8~~9.5 billion for the ~~three~~six months ended ~~September~~June 30, 2014~~, an increase of~~ ~~17%~~ ~~from~~ ~~$14.4 billion~~ ~~for the~~ ~~three~~ ~~months ended~~ ~~September 30, 2013. Average assets under management was $15.8 billion for the nine months ended~~ ~~September 30, 2014, an increase of~~ ~~10%~~ ~~from~~ ~~$14.4 billion~~ ~~for the nine months ended~~ ~~September 30, 2013~~.

~~Net inflows for open-end mutual funds were~~ ~~$103 million~~ ~~for the~~ ~~three~~ ~~months ended~~ ~~September 30, 2014, compared with net outflows of~~ ~~$46 million~~ ~~for the~~ ~~three~~ ~~months ended~~ ~~September 30, 2013. Gross inflows were~~ ~~$1.5 billion~~ ~~for the~~ ~~three~~ ~~months ended~~ ~~September 30, 2014, compared with $1.1 billion for the~~ ~~three~~ ~~months ended~~ ~~September 30, 2013. Gross outflows totaled~~ ~~$1.4 billion~~ ~~for the~~ ~~three~~ ~~months ended~~ ~~September 30, 2014, compared with~~ ~~$1.2 billion~~ ~~for the~~ ~~three~~ ~~months~~

~~ended~~ ~~September 30, 2013. Market depreciation was~~ ~~$503 million~~ ~~for the~~ ~~three~~ ~~months ended~~ ~~September 30, 2014, compared with~~ ~~$134 million~~ ~~for the~~ ~~three~~ ~~months ended~~ ~~September 30, 2013~~.

~~Net inflows for open-end mutual funds were $722 million for the nine months ended~~ ~~September 30, 2014, compared with $972 million for the nine months ended~~ ~~September 30, 2013. Gross inflows were $4.5 billion for the nine months ended~~ ~~September 30, 2014, compared with $4.4 billion for the nine months ended~~ ~~September 30, 2013. Gross outflows totaled $3.8 billion for the nine months ended~~ ~~September 30, 2014, compared with $3.4 billion for the nine months ended~~ ~~September 30, 2013. Market appreciation was $1.5 billion for the nine months ended~~ ~~September 30, 2014, compared with $328 million for the nine months ended~~ ~~September 30, 2013~~.

~~Closed-end mutual funds~~

~~Closed-end mutual funds assets under management were~~ ~~$9.6 billion~~ at ~~September 30, 2014, an increase of~~ ~~10%~~ ~~from~~ ~~$8.8 billion~~ at ~~September 30, 2013. The increase in assets under management was primarily due to market appreciation of $829 million for the twelve months ended~~ ~~September 30, 2014~~.

~~Average assets under management for closed-end mutual funds was~~ ~~$9.9 billion~~ ~~for the~~ ~~three~~ ~~months ended~~ ~~September 30, 2014, an increase of~~ ~~12%~~ ~~from~~ ~~$8.9 billion~~ ~~for the~~ ~~three~~ ~~months ended~~ ~~September 30, 2013. Average assets under management was $9.6 billion for the nine months ended~~ ~~September 30, 2014, an increase of~~ ~~10%~~ ~~from~~ ~~$8.7 billion~~ ~~for the nine months ended~~ ~~September 30, 2013~~, primarily due to market appreciation.

~~Market depreciation was~~ ~~$290 million~~ ~~for the~~ ~~three~~ ~~months ended~~ ~~September 30, 2014, compared with~~ ~~$60 million~~ ~~for the~~ ~~three~~ ~~months ended~~ ~~September 30, 2013~~.

~~Market appreciation was $673 million for the nine months ended~~ ~~September 30, 2014, compared with $59 million for the nine months ended~~ ~~September 30, 2013~~.

Results of Operations



	Three Months Ended June 30,								Six Months Ended June 30,
(in thousands)	2015				2014				2015				2014
Results of operations
Total revenue	$	83,502			$	78,412			$	167,317			$	151,247
Total expenses	(52,331		)		(48,744		)		(101,597		)		(93,983		)
Total non-operating income	1,797			⁽¹⁾	4,990			⁽¹⁾	245			⁽²⁾	8,171			⁽²⁾
Income before provision for income taxes	$	32,968		⁽¹⁾	$	34,658		⁽¹⁾	$	65,965		⁽²⁾	$	65,435		⁽²⁾

(1) Includes net income of $11 and $741 attributable to redeemable noncontrolling interest for the three months ended June 30, 2015 and 2014, respectively.
(2) Includes net loss of $34 and net income of $896 attributable to redeemable noncontrolling interest for the six months ended June 30, 2015 and 2014, respectively.

Three Months Ended ~~September~~June 30, ~~2014~~2015 Compared with Three Months Ended ~~September~~June 30, ~~2013~~

Three Months Ended
September 30,
(in thousands) 2014 2013
Results of operations
Total revenue $ 80,845
$ 74,026
Total expenses (48,518 ) (46,307 )
Total non-operating (loss) income ⁽¹⁾
(3,557 ) 3,303
Income before provision for income taxes ⁽¹⁾
$ 28,770
$ 31,022

(1) Includes net loss of $147 and net income of $1,534 attributable to redeemable noncontrolling interest for the three months ended September 30, 2014 and 2013, respectively.
2014

Revenue

Total revenue increased 9%6% to $~~80.8~~83.5 million for the three months ended ~~September~~June 30, ~~2014~~2015 from $~~74.0~~78.4 million for the three months ended ~~September~~June 30, ~~2013~~2014. This increase was primarily attributable to higher investment advisory and administration fees of ~~approximately $7.5~~$4.3 million, resulting from higher average assets under management ~~partially offset by lower~~in all three account types, and higher portfolio consulting and other revenue of approximately ~~$798,000,~~$506,000, primarily attributable to ~~lower~~higher average assets under advisement from model-based strategies.

For the three months ended ~~September~~June 30, ~~2014~~2015, total investment advisory ~~and administration~~ revenue from institutional accounts increased 4% to ~~$20.5~~$21.5 million from ~~$19.7~~$20.7 million for the three months ended ~~September~~June 30, ~~2013~~2014~~, primarily due to higher average assets under management.~~.

For the three months ended ~~September~~June 30, ~~2014~~2015, total investment advisory and administration revenue from open-end mutual funds increased ~~15%~~10% to ~~$33.4~~$34.8 million from ~~$28.9~~$31.5 million for the three months ended ~~September~~June 30, ~~2013~~2014~~, primarily attributable to higher average assets under management.~~.

For the three months ended ~~September~~June 30, ~~2014~~2015, total investment advisory and administration revenue from closed-end ~~mutual~~ funds increased ~~12%~~1% to ~~$21.3~~$20.9 million from ~~$19.1~~$20.6 million for the three months ended ~~September~~June 30, ~~2013~~2014~~, primarily due to higher average assets under management.~~.

For the three months ended ~~September~~June 30, ~~2014~~2015, total portfolio consulting and other revenue ~~decreased~~increased ~~30%~~29% to $~~1.9~~2.3 million from $~~2.7~~1.8 million for the three months ended ~~September~~June 30, ~~2013~~2014~~, primarily attributable to lower average assets under advisement from model-based strategies.~~.

Expenses

Total operating expenses increased 5%7% to $~~48.5~~52.3 million for the three months ended ~~September~~June 30, ~~2014~~2015 from $~~46.3~~48.7 million for the three months ended ~~September~~June 30, ~~2013~~2014, primarily due to increases of ~~$2.6~~$2.5 million in employee compensation and benefits, $760,000 in general and ~~$686,000~~administrative expenses and $269,000 in distribution and service ~~fees, partially offset by decreases of $388,000 in amortization, deferred commissions, $375,000 in general and administrative and $333,000 in depreciation and amortization~~fee expenses.

Employee compensation and benefits increased ~~11%~~10% to $~~26.7~~28.4 million for the three months ended ~~September~~June 30, ~~2014~~2015 from $~~24.1~~25.9 million for the three months ended ~~September~~June 30, ~~2013~~2014, primarily due to increases in incentive compensation of approximately ~~$1.2~~$1.5 million, salaries of approximately $449,000 and commission-based compensation of approximately $315,000, partially offset by lower amortization of restricted stock units of approximately ~~$1.1~~$562,000.

General and administrative expenses increased 6% to $12.8 million ~~and salaries~~for the three months ended June 30, 2015 from $12.1 million for the three months ended June 30, 2014. The increase was primarily due to higher international travel expenses of approximately ~~$650,000.~~$436,000 and increased rent and occupancy costs of approximately $266,000 attributable to the expansion of office space at our corporate headquarters.

Distribution and service fee expenses increased 8%3% to $~~9.0~~9.5 million for the three months ended ~~September~~June 30, ~~2014~~2015 from $~~8.4~~9.3 million for the three months ended ~~September~~June 30, ~~2013~~2014. The increase was primarily due to ~~an increase in~~higher average assets under management in open-end mutual ~~funds.~~funds, partially offset by a shift to lower cost share classes and the expiration of a compensation agreement entered into in connection with the common stock offering of one of our closed-end funds for which fees were incurred through January 2015.

Non-operating Income

~~General and administrative expenses decreased 3% to $11.3~~Non-operating income for the three months ended June 30, 2015 was $1.8 million, compared with non-operating income of $5.0 million for the three months ended ~~September~~June 30, 2014 ~~from $11.7 million for the three months ended~~ ~~September 30, 2013~~. The decrease was primarily due to lower ~~professional fees of approximately $768,000, partially offset by higher travel~~realized and ~~entertainment expenses of approximately $253,000.~~

~~Non-operating Income~~

~~Non-operating loss, excluding net loss attributable to redeemable noncontrolling interest of $147,000, was $3.4 million~~unrealized earnings from seed investments. The non-operating income for the three months ended ~~September~~June 30, ~~2014~~2015~~, compared with non-operating income, excluding~~ included net income attributable to redeemable noncontrolling interest of ~~$1.5 million, of $1.8 million~~$11,000. The non-operating income for the three months ended ~~September~~June 30, ~~2013~~2014~~. The decrease in non-operating~~ included net income ~~net of amounts~~ attributable to redeemable noncontrolling interest ~~was primarily due to lower earnings from seed investments.~~of $741,000.

Income Taxes

Income tax expense was $~~10.7~~12.2 million for the three months ended ~~September~~June 30, ~~2014~~2015, compared with $~~11.2~~11.7 million for the three months ended ~~September~~June 30, ~~2013~~2014. The provision for income taxes for the three months ended ~~September~~June 30, ~~2014~~2015 included U.S. federal, state, local and foreign taxes at an approximate effective tax rate of ~~37.1%~~37.0%. The effective tax rate for the three months ended June 30, 2014 was approximately 34.6%, which included the cumulative effect to adjust our estimated tax rate to ~~36%~~35.5% for the full year 2014. ~~The effective tax rate for the three months ended~~ ~~September 30, 2013~~ ~~was approximately 38%.~~ We expect our tax rate for the full year ~~2014~~2015 to approximate ~~36%~~37.0%, excluding discrete items.

~~Nine~~Six Months Ended ~~September~~June 30, ~~2014~~2015 Compared with ~~Nine~~Six Months Ended ~~September~~June 30, ~~2013~~

2014

Nine Months Ended
September 30,
(in thousands) 2014 2013
Results of operations
Total revenue $ 232,092
$ 224,281
Total expenses (142,501 ) (147,295 )
Total non-operating income (loss) ⁽¹⁾
4,614
(3,949 )
Income before provision for income taxes ⁽¹⁾
$ 94,205
$ 73,037

(1) Includes net income of $749 and net loss of $4,879 attributable to redeemable noncontrolling interest for the nine months ended September 30, 2014 and 2013, respectively.

Revenue

Total revenue increased 3%11% to ~~$232.1~~$167.3 million for the ~~nine~~six months ended ~~September~~June 30, ~~2014~~2015 from ~~$224.3~~$151.2 million for the ~~nine~~six months ended ~~September~~June 30, ~~2013~~2014. This increase was primarily attributable to higher investment advisory and administration fees of ~~approximately $12.2~~$14.5 million, resulting from higher average assets under management ~~partially offset by lower~~in all three account types, higher portfolio consulting and other revenue of approximately ~~$4.6 million,~~$862,000, attributable to ~~lower~~higher average assets under advisement from model-based ~~strategies.~~strategies, and higher distribution and service fees of approximately $706,000, attributable to higher average assets under management in our open-end mutual funds in 2015.

For the ~~nine~~six months ended ~~September~~June 30, ~~2014~~2015, total investment advisory ~~and administration~~ revenue from institutional accounts ~~decreased 3%~~increased 8% to ~~$60.7~~$43.3 million from ~~$62.3~~$40.3 million for the ~~nine~~six months ended ~~September~~June 30, ~~2013~~2014~~, primarily due to lower average assets under management.~~.

For the ~~nine~~six months ended ~~September~~June 30, ~~2014~~2015, total investment advisory and administration revenue from open-end mutual funds increased 9%16% to ~~$93.6~~$69.9 million from ~~$85.8~~$60.2 million for the ~~nine~~six months ended ~~September~~June 30, ~~2013~~2014~~, primarily due to higher average assets under management.~~.

For the ~~nine~~six months ended ~~September~~June 30, ~~2014~~2015, total investment advisory and administration revenue from closed-end mutual funds increased ~~11%~~4% to ~~$61.4~~$41.8 million from ~~$55.3~~$40.1 million for the ~~nine~~six months ended ~~September~~June 30, ~~2013~~2014~~, primarily due to higher average assets under management.~~.

For the ~~nine~~six months ended ~~September~~June 30, ~~2014~~2015, total portfolio consulting and other revenue ~~decreased 46%~~increased 24% to ~~$5.5~~$4.4 million from ~~$10.0~~$3.6 million for the ~~nine~~six months ended ~~September~~June 30, ~~2013~~2014~~, primarily attributable~~.

For the six months ended June 30, 2015, total distribution and service fees revenue increased 10% to ~~lower average assets under advisement~~$7.9 million from ~~model-based strategies.~~$7.2 million for the six months ended June 30, 2014.

Expenses

Total operating expenses ~~decreased 3%~~increased 8% to ~~$142.5~~$101.6 million for the ~~nine~~six months ended ~~September~~June 30, ~~2014~~2015 from ~~$147.3~~$94.0 million for the ~~nine~~six months ended ~~September~~June 30, ~~2013~~2014, primarily due to ~~decreases~~increases of ~~$6.5~~$4.5 million in employee compensation and benefits, $2.1 million in general and administrative expenses and $1.2 million in distribution and service ~~fees, $974,000~~fee expenses.

Employee compensation and benefits increased 9% to $54.4 million for the six months ended June 30, 2015 from $49.9 million for the six months ended June 30, 2014, primarily due to increases in salaries of approximately $1.4 million, incentive compensation of approximately $1.2 million and commission-based compensation of approximately $773,000, partially offset by lower amortization ~~deferred commissions and $913,000 in general~~of restricted stock units of approximately $536,000.

General and administrative expenses ~~partially offset by an~~increased 9% to $25.3 million for the six months ended June 30, 2015 from $23.2 million for the six months ended June 30, 2014. The increase was primarily due to higher international travel expenses of ~~$4.3 million in employee compensation~~approximately $861,000, increased rent and ~~benefits.~~occupancy costs of approximately $473,000 attributable to the expansion of office space at our corporate headquarters and higher information technology costs of approximately $292,000.

Distribution and service fee expenses ~~decreased 20%~~increased 7% to ~~$26.6~~$18.8 million for the ~~nine~~six months ended ~~September~~June 30, ~~2014~~2015 from ~~$33.1~~$17.6 million for the ~~nine~~six months ended ~~September~~June 30, ~~2013.~~2014. The ~~change, after excluding additional expenses of $7.2 million associated with the launch of Cohen & Steers MLP Income and Energy Opportunity Fund, Inc. ("MIE"),~~increase was primarily due to ~~an increase in~~higher average assets under management in open-end mutual ~~funds.~~funds, partially offset by a shift to lower cost share classes and the expiration of a compensation agreement entered into in connection with the common stock offering of one of our closed-end funds for which fees were incurred through January 2015.

~~General and administrative expenses decreased 3% to $34.5~~Non-operating Income

Non-operating income for the six month ended June 30, 2015 was $245,000, compared with $8.2 million for the ~~nine~~six months ended ~~September~~June 30, 2014 ~~from $35.4 million for the nine months ended September 30, 2013.~~. The decrease was primarily due to lower ~~professional fees of approximately $1.2 million.~~

~~Employee compensation~~realized and ~~benefits increased 6% to $76.6 million~~unrealized earnings from seed investments. The non-operating income for the ~~nine~~six months ended ~~September~~June 30, ~~2014 from $72.3 million~~2015 included net loss attributable to redeemable noncontrolling interest of $34,000. The non-operating income for the ~~nine~~six months ended ~~September~~June 30, 2013, primarily due to higher amortization of restricted stock units of approximately $3.0 million, higher incentive compensation of approximately $2.1 million and higher salaries of approximately $1.4 million, partially offset by lower severance of approximately $2.3 million and a decrease in commission-based compensation of approximately $520,000.

~~Non-operating Income~~

2014~~Non-operating income, excluding~~ included net income attributable to redeemable noncontrolling interest of ~~$749,000, was $3.9 million for the nine months ended~~ ~~September 30, 2014, compared with non-operating income of $930,000, excluding net loss attributable to redeemable noncontrolling interest of $4.9 million, for the nine months ended~~ ~~September 30, 2013. The increase in non-operating income net of amounts attributable to redeemable noncontrolling interest was primarily due to higher earnings from seed investments.~~$896,000.

Income Taxes

Income tax expense was ~~$33.6~~$24.4 million for the ~~nine~~six months ended ~~September~~June 30, ~~2014~~2015, compared with ~~$29.2~~$22.9 million for the ~~nine~~six months ended ~~September~~June 30, ~~2013~~2014. The provision for income taxes for the ~~nine~~six months ended ~~September~~June 30, ~~2014~~2015 included U.S. federal, state, local and foreign taxes at an approximate effective tax rate of ~~36%~~37.0%. The effective tax rate for the

~~nine~~ six months ended ~~September~~June 30, ~~2013~~2014 was approximately ~~37.5%, which included discrete items, the most significant of which was attributable to the launch costs of MIE. Excluding the discrete items, the effective tax rate for the nine months ended~~ ~~September 30, 2013~~ ~~was approximately 38%~~35.5%. We expect our tax rate for the full year ~~2014~~2015 to approximate ~~36%~~37.0%, excluding discrete items.

Changes in Financial Condition, Liquidity and Capital Resources

Our investment advisory business does not require us to maintain significant capital balances. Our current financial condition is highly liquid, with a significant amount of our assets comprised of cash and cash equivalents, ~~securities owned,~~trading investments, equity method investments, available-for-sale investments ~~available-for-sale~~ and accounts receivable. Our cash flows generally result from the operating activities of our business, with investment advisory and administrative fees being the most significant contributor. Cash and cash equivalents, equity method investments, available-for-sale investments ~~available-for-sale~~ and accounts receivable, excluding investments classified as level 3 in accordance with Accounting Standards Codification ~~(the “Codification”)~~ Topic 820, Fair Value Measurement ~~(“ASC 820”)~~, were ~~64% and 73%~~78% of total assets ~~as of~~at both ~~September~~June 30, ~~2014~~2015 and December 31, ~~2013,~~2014, respectively.

Cash and cash equivalents increased by ~~$10.6 million,~~$520,000, excluding the effect of foreign exchange rate changes, for the ~~nine~~six months ended ~~September~~June 30, ~~2014.~~2015. Net cash provided by operating activities was ~~$18.9~~$36.2 million for the ~~nine~~six months ended ~~September~~June 30, ~~2014.~~2015. Net cash provided by investing activities was ~~$10.9 million,~~$875,000, which included proceeds from sales of available-for-sale investments ~~available-for-sale~~ in the amount of ~~$11.0 million and proceeds from redemption of equity method investments of $10.9~~$4.6 million, partially offset by purchases of available-for-sale investments ~~available-for-sale~~ in the amount of ~~$6.1~~$2.9 million and purchases of property and equipment in the amount of ~~$4.9 million.~~$813,000. Net cash of ~~$19.3~~$36.5 million was used in financing activities, primarily for dividends to stockholders of ~~$29.6~~$22.7 million and repurchases of common stock to satisfy employee withholding tax obligations on the vesting and delivery of restricted stock units of ~~$11.7 million and distributions to redeemable noncontrolling interest of $5.0~~$19.2 million, partially offset by

excess tax benefits associated with the vesting and delivery of restricted stock units of $4.7 million, issuance of common stock of $341,000 and contributions from redeemable noncontrolling interest of ~~$24.0 million and excess tax benefits associated with the delivery of restricted stock units of $2.5 million.~~$279,000.

Cash and cash equivalents ~~increased~~decreased by $~~47.9~~16.2 million, excluding the effect of foreign exchange rate changes, for the ~~nine~~six months ended ~~September~~June 30, ~~2013~~2014. Net cash provided by operating activities was $~~41.1~~2.8 million for the ~~nine~~six months ended ~~September~~June 30, ~~2013~~2014. Net cash provided by investing activities was $~~15.5~~3.0 million, which included proceeds from sales of available-for-sale investments ~~available-for-sale~~ in the amount of $~~20.2~~8.3 million ~~and proceeds from redemption of equity method investments of $7.7 million,~~, partially offset by purchases of available-for-sale investments ~~available-for-sale~~ in the amount of $~~8.2~~3.6 million and purchases of property and equipment in the amount of $~~4.3~~2.2 million. Net cash of $~~8.7~~22.0 million was used in financing activities, primarily for dividends to stockholders of ~~$26.6~~$19.7 million ~~distributions to redeemable noncontrolling interest of~~ ~~$14.2 million~~ and repurchases of common stock to satisfy employee withholding tax obligations on the vesting and delivery of restricted stock units of ~~$8.0~~$11.6 million, partially offset by contributions from redeemable noncontrolling interest of $~~37.7~~7.3 million and excess tax benefits associated with the vesting and delivery of restricted stock units of $~~2.0~~2.5 million.

It is our policy to continuously monitor and evaluate the adequacy of our capital. We have consistently maintained net capital in excess of the regulatory requirements for our broker/dealer, as prescribed by the Securities and Exchange Commission ~~(“SEC”)~~(SEC). At ~~September~~June 30, ~~2014~~2015, we exceeded our minimum regulatory capital requirements by approximately ~~$1.7 million.~~$897,000. The SEC’s Uniform Net Capital Rule 15c3-1 imposes certain requirements that may have the effect of prohibiting a broker/dealer from distributing or withdrawing capital and requiring prior notice to the SEC for certain withdrawals of capital. ~~Certain of our non-U.S. subsidiaries~~

Cohen & Steers Asia Limited (CSAL) and Cohen & Steers UK Limited (CSUK) are regulated outside the U.S. by the Hong Kong Securities and Futures Commission and the United Kingdom Financial Conduct ~~Authority.~~Authority, respectively. At ~~September~~June 30, ~~2014, our regulated non-U.S. subsidiaries~~2015, CSAL and CSUK exceeded their aggregate minimum regulatory requirements by approximately ~~$50.6~~$64.0 million. We believe that our cash and cash equivalents and cash flows from operations will be more than adequate to meet our anticipated capital requirements and other obligations as they become due.

Included in cash and cash equivalents was approximately ~~$78.2~~$85.2 million held by our foreign subsidiaries as of ~~September~~June 30, ~~2014~~2015. It is our current intention to permanently reinvest funds held by our ~~foreign subsidiaries outside of the U.S.~~non-U.S. subsidiaries. We believe that our cash and cash equivalents and short term investments held in the U.S. are more than sufficient to cover our working capital needs in the U.S.

We periodically commit to fund a portion of the equity in certain of our sponsored investment products. We have committed to co-invest up to $5.1 million alongside Cohen & Steers Global Realty Partners III-TE, L.P. ~~("GRP-TE")~~(GRP-TE). As of ~~September~~June 30, ~~2014~~2015, we ~~have~~ funded approximately ~~$3.0~~$3.2 million with respect to this commitment. Our co-investment

alongside GRP-TE is illiquid and ~~will~~is anticipated to be invested for ~~up to 12 years through~~ the life of the fund. The ~~actual~~ timing of the funding of ~~this~~the unfunded portion of our commitment is currently unknown, as the drawdown of our commitment is contingent on the timing of drawdowns by the underlying funds and co-investments in which GRP-TE invests. The unfunded portion of this commitment was not recorded on our condensed consolidated statements of financial condition as of ~~September~~June 30, ~~2014~~2015.

Contractual Obligations and Contingencies

We have contractual obligations to make future payments in connection with our ~~non-cancelable~~noncancelable operating ~~lease agreements~~leases for office ~~space.~~space and certain computer and office equipment. There were no material capital lease obligations as of ~~September~~June 30, ~~2014~~2015. The following summarizes our contractual obligations as of ~~September~~June 30, ~~2014~~2015 (in thousands):

2014 2015 2016 2017 2018
2019
and after
Total
Operating leases $ 2,387
$ 9,516
$ 9,269
$ 8,732
$ 8,447
$ 47,321
$ 85,672



	2015		2016		2017		2018		2019		2020 and after		Total
Operating leases	$	5,645	$	11,472	$	10,474	$	9,997	$	10,733	$	42,976	$	91,297

Off-Balance Sheet Arrangements

We do not invest in any off-balance sheet vehicles that provide liquidity, capital resources, market or credit risk support, or engage in any leasing activities that expose us to any liability that is not reflected in our condensed consolidated financial statements.

Critical Accounting Policies and Estimates

A complete discussion of critical accounting policies is included in Management's Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the year ended December 31, ~~2013.~~2014. There were no significant changes in our critical accounting policies during the three months ended ~~September~~June 30, ~~2014.~~2015.

Recently Issued Accounting Pronouncements

See discussion of Recently Issued Accounting Pronouncements in Note 2 of the Notes to Condensed Consolidated Financial Statements contained in Part I, Item 1 of this ~~filing.~~report.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

There have been no material changes into our Quantitative and Qualitative Disclosures About Market Risk from those previously reported in our Annual Report on Form 10-K for the year ended December 31, ~~2013.~~2014.

Item 4. Controls and Procedures

We maintain disclosure controls and procedures (as that term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the ~~“Exchange Act”~~Exchange Act))), that are designed to ensure that information required to be disclosed in our reports under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and our Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures. Any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.

Our management, including our Chief Executive Officer and our Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) as of ~~September~~June 30, ~~2014~~2015. Based on that evaluation and subject to the foregoing, our Chief Executive Officer and our Chief Financial Officer have concluded that our disclosure controls and procedures as of ~~September~~June 30, ~~2014~~2015 were effective to accomplish their objectives at a reasonable assurance level.

There has been no change in our internal control over financial reporting that occurred during the three months ended ~~September~~June 30, ~~2014~~2015 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

3231

PART II—Other Information

Item 1. Legal Proceedings

From time to time, we may become involved in legal matters relating to claims arising in the ordinary course of our business. There are currently no such matters pending that we believe could have a material effect on our condensed consolidated results of operations, cash flows or financial condition. From time to time, we receive subpoenas or other requests for information from various U.S. federal and state governmental authorities, domestic and international regulatory authorities and third parties in connection with certain industry-wide inquiries or other investigations or legal proceedings. It is our policy to cooperate fully with such ~~inquiries.~~requests.

Item 1A. Risk Factors

For a discussion of the potential risks and uncertainties associated with our business, please see Part 1,I, Item 1A of our ~~2013~~ Annual Report on Form 10-K ~~filed with~~for the ~~SEC on March 14, 2014.~~year ended December 31, 2014 (the Form 10-K). There have been no material changes to the risk factors disclosed in Part 1, Item 1A of ~~our 2013 Annual Report on~~the Form 10-K.

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

During the three months ended ~~September~~June 30, ~~2014~~2015, we made the following purchases of our equity securities that are registered pursuant to Section 12(b) of the Securities Exchange Act of 1934.

Period
Total Number of
Shares Purchased

Average Price
Paid Per Share

Total Number of
Shares Purchased
as Part of Publicly
Announced Plans
or Programs

Maximum Number
of Shares that May
Yet be Purchased
Under the Plans or
Programs
July 1 through July 31, 2014 55
⁽¹⁾
$ 42.33
—
—
August 1 through August 31, 2014 2,073
⁽¹⁾
$ 43.15
—
—
September 1 through September 30, 2014 145
⁽¹⁾
$ 41.26
—
—
Total 2,273
$ 43.01
—
—



Period	Total Number of Shares Purchased ⁽¹⁾	Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs
April 1 through April 30, 2015	11,006	$	40.11	—	—
May 1 through May 31, 2015	—	$	—	—	—
June 1 through June 30, 2015	848	$	34.38	—	—
Total	11,854	$	39.70	—	—

_________________________


(1)	Purchases made to satisfy the income tax withholding obligations of certain employees upon the vesting and delivery of restricted stock units issued under the ~~stock incentive plan.~~Company's Amended and Restated Stock Incentive Plan.

3332

Item 6. Exhibits

Any agreements or other documents filed as exhibits to this report are not intended to provide factual information or other disclosure other than with respect to the terms of the agreements or other documents themselves, and should not be relied upon for that purpose. In particular, any representations and warranties made by the Company in these agreements or other documents were made solely within the specific context of the relevant agreement or document and may not describe the actual state of affairs as of the date they were made or at any other time.



Exhibit No.		Description

3.1	—	Form of Amended and Restated Certificate of Incorporation of the Registrant(1)

3.2	—	Form of Amended and Restated Bylaws of the Registrant(2)

4.1	—	Specimen Common Stock ~~Certificate(1)~~Certificate (filed herewith)

4.2	—	Form of Registration Rights Agreement among the Registrant, Martin Cohen, Robert H. Steers, The Martin Cohen 1998 Family Trust and Robert H. Steers Family Trust(1)

31.1	—	Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith)

31.2	—	Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith)

32.1	—	Certification of the Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith)

32.2	—	Certification of the Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith)

101	—	The following financial statements from the Registrant's Quarterly Report on Form 10-Q for the quarter ended ~~September~~June 30, ~~2014,~~2015 formatted in XBRL (eXtensible Business Reporting Language): (i) the Condensed Consolidated Statements of Financial Condition (unaudited) as of ~~September~~June 30, ~~2014~~2015 and December 31, ~~2013,~~2014, (ii) the Condensed Consolidated Statements of Operations (unaudited) for the three and ~~nine~~six months ended ~~September~~June 30, ~~2014~~2015 and ~~2013,~~2014, (iii) the Condensed Consolidated Statements of Comprehensive Income (unaudited) for the three and ~~nine~~six months ended ~~September~~June 30, ~~2014~~2015 and ~~2013,~~2014, (iv) the Condensed Consolidated Statements of Changes in Stockholders' Equity and Redeemable Noncontrolling Interest (unaudited) for the ~~nine~~six months ended ~~September~~June 30, ~~2014~~2015 and ~~2013,~~2014, (v) the Condensed Consolidated Statements of Cash Flows (unaudited) for the ~~nine~~six months ended ~~September~~June 30, ~~2014~~2015 and ~~2013,~~2014, and (vi) the Notes to the Condensed Consolidated Financial Statements.

_________________________


(1)	Incorporated by reference to the Registrant’s Registration Statement on Form S-1 (Registration No. 333-114027), as amended, originally filed with the Securities and Exchange Commission on March 30, 2004.


(2)	Incorporated by reference to the Registrant’s Quarterly Report on Form 10-Q (Commission File No. 001-32236) for the quarter ended June 30, 2008.

3433

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.



Date:	~~November 6, 2014~~August 7, 2015	Cohen & Steers, Inc.

		/s/ Matthew S. Stadler
		Name: Matthew S. Stadler
		Title: Executive Vice President & Chief Financial Officer



Date:	~~November 6, 2014~~August 7, 2015	Cohen & Steers, Inc.

		/s/ Elena Dulik
		Name: Elena Dulik
		Title: Senior Vice President & Chief Accounting Officer

3534



	Three Months Ended September 30, 2014									Nine Months Ended September 30, 2014
	Securities Owned					Equity Method Investments		Investments, available-for-sale		Securities Owned						Equity Method Investments			Investments, available-for-sale
	Common Stocks		Limited Partnership Interests			GRP-TE		Preferred Securities		Common Stocks			Limited Partnership Interests			GRP-TE/Offshore Fund			Preferred Securities
Balance at beginning of period	$	—	$	2,378		$	105	$	—	$	503		$	2,740		$	528		$	3,325
Purchases / contributions	—		151			2		—		—			456			11			—
Sales / distributions	—		—			—		—		(527		)	(721		)	(463		)	(4,000		)
Realized gains (losses)	—		—			—		—		24			64			—			675
Unrealized gains (losses) ⁽¹⁾	—		(113		)	—		—		—			(123		)	31			—
Transfers into (out of) level 3	—		—			—		—		—			—			—			—
Balance at end of period	$	—	$	2,416		$	107	$	—	$	—		$	2,416		$	107		$	—



Period	Total Number of Shares Purchased		Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Maximum Number of Shares that May Yet be Purchased Under the Plans or Programs
July 1 through July 31, 2014	55	⁽¹⁾	$	42.33	—	—
August 1 through August 31, 2014	2,073	⁽¹⁾	$	43.15	—	—
September 1 through September 30, 2014	145	⁽¹⁾	$	41.26	—	—
Total	2,273		$	43.01	—	—

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