Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2018 | Jul. 20, 2018 | |
Entity Registrant Name | FEDERATED INVESTORS INC /PA/ | |
Entity Central Index Key | 1,056,288 | |
Trading Symbol | FII | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2018 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2,018 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Amendment Flag | false | |
Subsequent Event [Member] | Class A [Member] | ||
Entity Common Stock, Shares Outstanding | 9,000 | |
Subsequent Event [Member] | Class B [Member] | ||
Entity Common Stock, Shares Outstanding | 100,763,162 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Current Assets | ||
Cash and Cash Equivalents | $ 375,172 | $ 316,264 |
Investments—Consolidated Investment Companies | 33,603 | 45,411 |
Investments—Affiliates and Other | 8,786 | 7,863 |
Receivables, net of reserve of $11 and $60, respectively | 44,706 | 53,482 |
Prepaid Expenses | 19,906 | 11,747 |
Other Current Assets | 2,007 | 2,507 |
Total Current Assets | 484,180 | 437,274 |
Long-Term Assets | ||
Goodwill | 660,040 | 660,040 |
Renewable Investment Advisory Contracts | 73,878 | 73,878 |
Other Intangible Assets, net of accumulated amortization of $5,489 and $5,202, respectively | 2,711 | 2,997 |
Property and Equipment, net of accumulated depreciation of $75,803 and $70,561, respectively | 39,338 | 37,670 |
Other Long-Term Assets | 16,168 | 19,551 |
Total Long-Term Assets | 792,135 | 794,136 |
Total Assets | 1,276,315 | 1,231,410 |
Current Liabilities | ||
Accounts Payable and Accrued Expenses | 51,358 | 47,595 |
Accrued Compensation and Benefits | 43,396 | 74,572 |
Other Current Liabilities | 40,306 | 6,682 |
Total Current Liabilities | 135,060 | 128,849 |
Long-Term Liabilities | ||
Long-Term Debt | 178,000 | 170,000 |
Long-Term Deferred Tax Liability, net | 122,806 | 117,620 |
Other Long-Term Liabilities | 20,340 | 23,563 |
Total Long-Term Liabilities | 321,146 | 311,183 |
Total Liabilities | 456,206 | 440,032 |
Commitments and Contingencies (Note (15)) | ||
TEMPORARY EQUITY | ||
Redeemable Noncontrolling Interest in Subsidiaries | 20,984 | 30,163 |
PERMANENT EQUITY | ||
Retained Earnings | 732,753 | 697,359 |
Treasury Stock, at Cost, 8,742,294 and 8,405,003 Shares Class B Common Stock, respectively | (288,277) | (278,732) |
Accumulated Other Comprehensive Loss, net of tax | (1,489) | (790) |
Total Permanent Equity | 799,125 | 761,215 |
Total Liabilities, Temporary Equity and Permanent Equity | 1,276,315 | 1,231,410 |
Class A [Member] | ||
PERMANENT EQUITY | ||
Common Stock | 189 | 189 |
Class B [Member] | ||
PERMANENT EQUITY | ||
Common Stock | $ 355,949 | $ 343,189 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Receivables, reserve | $ 11 | $ 60 |
Other Intangible Assets, accumulated amortization | 5,489 | 5,202 |
Property and Equipment, accumulated depreciation | $ 75,803 | $ 70,561 |
Treasury Stock, Shares | 8,742,294 | 8,405,003 |
Class A [Member] | ||
Common Stock, No Par Value | $ 0 | $ 0 |
Common Stock, Shares Authorized | 20,000 | 20,000 |
Common Stock, Shares Issued | 9,000 | 9,000 |
Common Stock, Shares Outstanding | 9,000 | 9,000 |
Class B [Member] | ||
Common Stock, No Par Value | $ 0 | $ 0 |
Common Stock, Shares Authorized | 900,000,000 | 900,000,000 |
Common Stock, Shares Issued | 109,505,456 | 109,505,456 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | ||
Revenue | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 255,993 | $ 272,796 | $ 519,845 | $ 546,297 | |
Operating Expenses | |||||
Compensation and Related | 74,147 | 71,370 | 152,521 | 144,772 | |
Distribution | 69,446 | 87,174 | 141,945 | 177,533 | |
Professional Service Fees | 9,278 | 6,116 | 18,908 | 13,194 | |
Systems and Communications | 7,751 | 8,041 | 16,184 | 16,266 | |
Office and Occupancy | 7,365 | 7,161 | 14,906 | 14,513 | |
Travel and Related | 3,523 | 2,958 | 6,344 | 5,893 | |
Advertising and Promotional | 3,237 | 3,095 | 6,465 | 6,051 | |
Other | 489 | 2,670 | 2,144 | 6,091 | |
Total Operating Expenses | 175,236 | 188,585 | 359,417 | 384,313 | |
Operating Income | 80,757 | 84,211 | 160,428 | 161,984 | |
Nonoperating (Expenses) Income | |||||
Investment Income, net | 2,192 | 1,703 | 4,092 | 3,355 | |
(Loss) Gain on Securities, net | (815) | 2,234 | (1,997) | 4,796 | |
Debt Expense | (1,431) | (1,182) | (2,761) | (2,283) | |
Other, net | (28,974) | (33) | (29,117) | (34) | |
Total Nonoperating (Expenses) Income, net | (29,028) | 2,722 | (29,783) | 5,834 | |
Income Before Income Taxes | 51,729 | 86,933 | 130,645 | 167,818 | |
Income Tax Provision | 13,062 | 32,274 | 31,972 | 62,132 | |
Net Income Including the Noncontrolling Interests in Subsidiaries | 38,667 | 54,659 | 98,673 | 105,686 | |
Less: Net (Loss) Income Attributable to the Noncontrolling Interests in Subsidiaries | (155) | 1,208 | (480) | 2,594 | |
Net Income | $ 38,822 | $ 53,451 | $ 99,153 | $ 103,092 | |
Amounts Attributable to Federated Investors, Inc. | |||||
Earnings Per Common Share—Basic and Diluted | [1] | $ 0.38 | $ 0.53 | $ 0.98 | $ 1.01 |
Cash Dividends Per Share | $ 0.27 | $ 0.25 | $ 0.52 | $ 0.50 | |
Investment Advice-Affiliates [Member] | |||||
Revenue | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 130,531 | $ 145,205 | $ 265,762 | $ 293,124 | |
Investment Advice-Other [Member] | |||||
Revenue | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | 37,596 | 34,117 | 76,631 | 67,515 | |
Administrative Service [Member] | |||||
Revenue | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | 48,370 | 45,601 | 97,393 | 92,302 | |
Distribution and Shareholder Service [Member] | |||||
Revenue | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | 39,496 | 46,414 | 80,059 | 90,373 | |
Financial Service, Other [Member] | |||||
Revenue | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 0 | $ 1,459 | $ 0 | $ 2,983 | |
[1] | Federated Common Stock excludes unvested restricted shares which are deemed participating securities in accordance with the two-class method of computing earnings per share. |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Net Income Including the Noncontrolling Interests in Subsidiaries | $ 38,667 | $ 54,659 | $ 98,673 | $ 105,686 |
Permanent Equity | ||||
Foreign Currency Items | (722) | 223 | (479) | 363 |
Reclassification Adjustment Related to Foreign Currency Items | 0 | 0 | (191) | 0 |
Unrealized Gain on Equity Securities | 0 | 276 | 0 | 1,393 |
Reclassification Adjustment Related to Equity Securities | 0 | (510) | (29) | (1,157) |
Other Comprehensive (Loss) Income, net of tax | (722) | (11) | (699) | 599 |
Comprehensive Income Including the Noncontrolling Interests in Subsidiaries | 37,945 | 54,648 | 97,974 | 106,285 |
Less: Comprehensive (Loss) Income Attributable to Redeemable Noncontrolling Interest in Subsidiaries | (155) | 1,208 | (480) | 2,118 |
Less: Comprehensive Income Attributable to Nonredeemable Noncontrolling Interest in Subsidiary | 0 | 0 | 0 | 476 |
Comprehensive Income Attributable to Federated Investors, Inc. | $ 38,100 | $ 53,440 | $ 98,454 | $ 103,691 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Equity - USD ($) $ in Thousands | Total | Common Stock [Member] | Retained Earnings [Member] | Treasury Stock [Member] | Accumulated Other Comprehensive (Loss) Income, net of tax [Member] | Total Shareholders' Equity [Member] | Nonredeemable Noncontrolling Interest in Subsidiary [Member] | Redeemable Noncontrolling Interest in Subsidiaries/Temporary Equity [Member] |
Balance at Dec. 31, 2016 | $ 595,784 | $ 320,982 | $ 529,749 | $ (255,382) | $ (523) | $ 594,826 | $ 958 | |
Balance - Temporary Equity at Dec. 31, 2016 | $ 31,362 | |||||||
Net Income (Loss) | 103,568 | 103,092 | 103,092 | 476 | 2,118 | |||
Other Comprehensive Income (Loss), net of tax | 599 | 599 | 599 | 0 | ||||
Subscriptions—Redeemable Noncontrolling Interest Holders | 3,499 | |||||||
Deconsolidation | (1,891) | |||||||
Stock Award Activity | 12,294 | 12,204 | (14,131) | 14,221 | 12,294 | |||
Dividends Declared | (50,930) | (50,930) | (50,930) | |||||
Distributions to Noncontrolling Interest in Subsidiaries | (1,434) | (1,434) | (4,426) | |||||
Purchases of Treasury Stock | (28,252) | (28,252) | (28,252) | |||||
Balance at Jun. 30, 2017 | 631,629 | 333,186 | 567,780 | (269,413) | 76 | 631,629 | 0 | |
Balance - Temporary Equity at Jun. 30, 2017 | 30,662 | |||||||
Balance at Dec. 31, 2017 | 761,215 | 343,378 | 697,359 | (278,732) | (790) | 761,215 | 0 | |
Balance - Temporary Equity at Dec. 31, 2017 | 30,163 | |||||||
Net Income (Loss) | 99,153 | 99,153 | 99,153 | 0 | (480) | |||
Other Comprehensive Income (Loss), net of tax | (445) | (445) | (445) | 0 | ||||
Subscriptions—Redeemable Noncontrolling Interest Holders | 1,163 | |||||||
Deconsolidation | (1,751) | |||||||
Stock Award Activity | 12,967 | 12,760 | (11,288) | 11,495 | 12,967 | |||
Dividends Declared | (52,596) | (52,596) | (52,596) | |||||
Distributions to Noncontrolling Interest in Subsidiaries | 0 | (8,111) | ||||||
Purchases of Treasury Stock | (21,040) | (21,040) | (21,040) | |||||
Balance at Jun. 30, 2018 | 799,125 | $ 356,138 | 732,753 | $ (288,277) | (1,489) | 799,125 | $ 0 | |
Balance - Temporary Equity at Jun. 30, 2018 | $ 20,984 | |||||||
Adoption of New Accounting Pronouncements | Adjustments for New Accounting Pronouncement [Member] | $ (129) | $ 125 | $ (254) | $ (129) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Operating Activities | ||
Net Income Including the Noncontrolling Interests in Subsidiaries | $ 98,673 | $ 105,686 |
Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities | ||
Amortization of Deferred Sales Commissions | 1,614 | 4,879 |
Depreciation and Other Amortization | 5,343 | 5,179 |
Share-Based Compensation Expense | 12,768 | 12,234 |
Gain on Disposal of Assets | (509) | (3,350) |
Provision for Deferred Income Taxes | 5,610 | 7,121 |
Loss on Derivative | 28,978 | 0 |
Fair-Value Adjustments for Contingent Liabilities | 124 | 0 |
Net Unrealized Loss (Gain) on Investments | 2,549 | (1,367) |
Net Sales of Investments—Consolidated Investment Companies | 7,743 | 11,008 |
Deferred Sales Commissions Paid | (43) | (2,846) |
Contingent Deferred Sales Charges Received | 0 | 1,157 |
Other Changes in Assets and Liabilities: | ||
Decrease in Receivables, net | 8,771 | 2,129 |
Increase in Prepaid Expenses and Other Assets | (6,765) | (3,589) |
Decrease in Accounts Payable and Accrued Expenses | (30,446) | (43,260) |
Increase in Other Liabilities | 1,976 | 1,390 |
Net Cash Provided by Operating Activities | 136,386 | 96,371 |
Investing Activities | ||
Purchases of Investments—Affiliates and Other | (2,515) | (3,977) |
Cash Paid for Business Acquisitions | 0 | (4,352) |
Proceeds from Redemptions of Investments—Affiliates and Other | 2,419 | 22,496 |
Cash Paid for Property and Equipment | (5,397) | (3,461) |
Net Cash (Used) Provided by Investing Activities | (5,493) | 10,706 |
Financing Activities | ||
Dividends Paid | (52,604) | (50,937) |
Purchases of Treasury Stock | (20,374) | (30,083) |
Distributions to Noncontrolling Interest in Subsidiaries | (8,111) | (5,860) |
Contributions from Noncontrolling Interest in Subsidiaries | 1,163 | 3,499 |
Cash Paid for Amended and Restated Credit Agreement | 0 | (483) |
Proceeds from Shareholders for Share-Based Compensation | 207 | 90 |
Proceeds from New Borrowings | 18,000 | 0 |
Payments on Contingent Consideration Liabilities | (228) | (210) |
Payments on Debt | (10,000) | (12,750) |
Net Cash Used by Financing Activities | (71,947) | (96,734) |
Net Increase in Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents | 58,946 | 10,343 |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Beginning of Period | 316,809 | 105,355 |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, End of Period | 375,755 | 115,698 |
Less: Restricted Cash and Restricted Cash Equivalents Recorded in Other Long-Term Assets | 583 | 530 |
Cash and Cash Equivalents | $ 375,172 | $ 115,168 |
Basis of Presentation
Basis of Presentation | 6 Months Ended |
Jun. 30, 2018 | |
Basis of Accounting [Abstract] | |
Basis of Accounting | Basis of Presentation Federated provides investment advisory, administrative, distribution and other services to various investment products, including sponsored investment companies and other funds ( Federated Funds ) and Separate Accounts (which include separately managed accounts, institutional accounts, sub-advised funds and other managed products) in both domestic and international markets. The interim Consolidated Financial Statements of Federated Investors, Inc. and its consolidated subsidiaries (collectively, Federated ) included herein have been prepared in accordance with United States ( U.S. ) generally accepted accounting principles ( GAAP ). In the opinion of management, the financial statements reflect all adjustments that are of a normal recurring nature and necessary for a fair presentation of the results for the interim periods presented. In preparing the financial statements, management is required to make estimates and assumptions that affect the amounts reported in the Consolidated Financial Statements and accompanying notes. Actual results may differ from those estimates, and such differences may be material to the Consolidated Financial Statements. These financial statements should be read in conjunction with Federated's Annual Report on Form 10-K for the year ended December 31, 2017 . Certain items previously reported have been reclassified to conform to the current period's presentation. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements Recent Accounting Pronouncements | 6 Months Ended |
Jun. 30, 2018 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
New Accounting Pronouncements and Changes in Accounting Principles [Text Block] | Recently Adopted Accounting Guidance Revenue Recognition On May 28, 2014, the Financial Accounting Standards Board ( FASB ) issued Accounting Standards Update ( ASU ) 2014-09, Revenue from Contracts with Customers ( Topic 606 ), which supersedes virtually all existing revenue recognition guidance under GAAP. The update's core principle is that an entity should recognize 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. During 2016, the FASB issued ASU 2016-08, which clarified principal versus agent considerations, ASU 2016-10, which clarified identifying performance obligations and the licensing implementation guidance, ASU 2016-12, which addressed implementation issues and provided additional practical expedients and ASU 2016-20, which provided technical corrections to narrow aspects of the guidance (collectively, with ASU 2014-09, Topic 606). Effective January 1, 2018, Federated adopted Topic 606 using the modified retrospective method, which did not require the restatement of prior years. In connection with the adoption of Topic 606, Federated has applied the guidance to all contracts that were not completed on the effective date of adoption. Management reevaluated the capitalization and amortization policies of deferred sales commission assets, which resulted in a shorter amortization period. Upon adoption, Federated recorded a cumulative-effect adjustment of $8.1 million as a reduction to Other Long-Term Assets and Retained Earnings . Contingent deferred sales charges ( CDSC s) received, which were previously recorded as a reduction of deferred sales commission assets, are now being recorded as revenue. Upon adoption, Federated recorded a cumulative-effect adjustment of $8.0 million as an increase to Other Long-Term Assets and Retained Earnings . For the three and six months ended June 30, 2018 , $0.5 million and $0.8 million , respectively, of CDSCs received were recorded as revenue in Other Service Fees, net—Affiliates on the Consolidated Statements of Income . Consideration Payable to Customers (which includes reimbursements or assumptions of fund-related expenses) of $8.2 million and $16.8 million , respectively, for the three and six months ended June 30, 2018 , was recorded as a reduction of revenue in Investment Advisory Fees, net—Affiliates ( previously recorded primarily as Distribution expense ) on the Consolidated Statements of Income . Additionally, certain revenue is now being recorded as a single asset management fee, as it is part of a unitary fee arrangement with a single performance obligation. As such, $1.6 million and $3.3 million , respectively, for the three and six months ended June 30, 2018 was recorded in Investment Advisory Fees, net—Other (previously recorded in Other Service Fees, net—Other ) on the Consolidated Statements of Income . Financial Instruments Effective January 1, 2018, Federated adopted ASU 2016-01 , Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. The ASU significantly revises an entity's accounting related to (1) the classification and measurement of investments in equity securities, including investments in mutual funds and (2) the presentation of certain fair value changes for financial liabilities. The ASU also amends certain disclosure requirements associated with the fair value of financial instruments. Management elected the modified retrospective transition method which was applied by means of a cumulative-effect adjustment to the Consolidated Balance Sheets. While the modified retrospective transition method did not require the restatement of prior years, management elected to reclassify certain prior year presentations and disclosures, primarily the investment and fair value measurement footnotes and the Consolidated Statements of Cash Flows, to ensure comparability with current year investment classifications. The adoption did not have a material impact to Federated's Consolidated Financial Statements. Statement of Cash Flows On January 1, 2018, Federated adopted ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. The standard addresses eight specific cash flow issues to reduce diversity in practice in how certain cash receipts and cash payments are presented on the Statement of Cash Flows. One relevant issue pertained to contingent consideration payments made after a business combination. However, Federated was already classifying these payments appropriately. While the ASU required the retrospective adoption approach, the adoption did not have an impact to Federated's Consolidated Financial Statements. On January 1, 2018, Federated adopted ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash, a consensus of the FASB Emerging Issues Task Force. Under this ASU, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statements of cash flows. The ASU required the retrospective adoption approach, which required the restatement of prior periods presented. The adoption did not have a material impact to Federated's Consolidated Financial Statements. Clarifying the Definition of a Business On January 1, 2018, Federated adopted ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business. The amendments in this update require that when substantially all of the fair value of the gross assets acquired (or disposed of) is concentrated in a single identifiable asset (or a group of similar identifiable assets), the assets are not considered to be a business. To be considered a business, an acquisition or disposal must include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create outputs. The amendments also narrow the definition of the term "outputs" to be consistent with Topic 606. The ASU was required to be applied prospectively. The adoption did not have a material impact to Federated's Consolidated Financial Statements. Reporting on Comprehensive Income Effective January 1, 2018, Federated adopted ASU 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. Due to the revaluation of deferred taxes resulting from the Tax Cuts and Jobs Act of 2017 ( Tax Act ) being required to be included in income, regardless of the source of income or loss to which the deferred item related, the tax effects of items within Accumulated Other Comprehensive Loss, net of tax did not reflect the appropriate tax rate. The amendments in this update allow a reclassification from Accumulated other comprehensive loss, net of tax to Retained earnings for these stranded tax effects resulting from the Tax Act . Management elected to apply the guidance in the period of adoption, which did not require the restatement of prior years, and was applied by means of a cumulative-effect adjustment to the Consolidated Balance Sheets. The adoption did not have a material impact to Federated's Consolidated Financial Statements. |
Description of New Accounting Pronouncements Not yet Adopted [Text Block] | Recently Issued Accounting Guidance Not Yet Adopted Leases On February 25, 2016, the FASB issued ASU 2016-02, Leases ( Topic 842 ). The core principle is that a lessee should recognize the assets and liabilities that arise from leases on the balance sheet, while retaining a distinction between finance and operating leases. The update is effective for Federated on January 1, 2019. While early adoption is permitted, Federated does not plan to early adopt. The update requires the modified retrospective adoption method. Management continues to identify the population of contracts for testing to determine if a lease exists, and is currently evaluating the potential impact of adoption to Federated's Consolidated Financial Statements. Goodwill Impairment On January 26, 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. Under this ASU, an entity should perform its annual or interim goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount, and recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit's fair value. However, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. Additionally, the ASU retains the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. The update is effective for Federated on January 1, 2020, with early adoption permitted, and requires the prospective adoption method. Management is currently evaluating the potential impact of adoption to Federated's Consolidated Financial Statements. |
Significant Accounting Policies
Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies [Text Block] | Significant Accounting Policies As a result of the adoptions of Topic 606 and ASU 2016-01 , as well as current period derivative activity, the following accounting policies have been updated. For a complete listing of Federated's significant accounting policies, please refer to Federated's Annual Report on Form 10-K for the year ended December 31, 2017 . Deferred Sales Commissions Federated pays upfront commissions to broker/dealers ( Deferred Sales Commissions ) to promote the sale of certain fund shares. For share classes that pay both a distribution fee and a CDSC, Federated generally capitalizes the Deferred Sales Commissions. The deferred sales commission asset (included in Other Long-Term Assets on the Consolidated Balance Sheets ) is amortized over the estimated period of benefit of six years . Deferred sales commission amortization expense was $1.6 million and $4.9 million for the six months ended June 30, 2018 and 2017 , respectively, and was included in Distribution expense on the Consolidated Statements of Income . Federated reviews the carrying value of deferred sales commission assets on a periodic basis to determine whether a significant long-term decline in the equity or bond markets or other events or circumstances indicate that an impairment in value may have occurred. Should there be an indication of an impairment in value, Federated compares the carrying value of the asset to the probability-weighted undiscounted future cash flows of the underlying asset to determine whether an impairment has occurred. If the carrying value of the asset exceeds the undiscounted future cash flows, the deferred sales commission asset is written down to its estimated fair value determined using discounted future cash flows. There were no impairments to the deferred sales commission asset during the six months ended June 30, 2018 and 2017 . For share classes that do not pay both a distribution fee and CDSC, Federated may be entitled to receive an upfront commission, which is collected from subscribing shareholders and recognized as revenue in Other Service Fees, net—Affiliates on the Consolidated Statements of Income upon investor subscription. For Deferred Sales Commissions that are not capitalized, the Deferred Sales Commissions paid are expensed as incurred and totaled $2.6 million and $0.8 million as of June 30, 2018 and 2017 , respectively, and were included in Distribution expense on the Consolidated Statements of Income . Revenue Recognition All of Federated's revenue is earned from contracts with customers, which are generally terminable upon no more than 60 days' notice. Revenue is measured in an amount that reflects the consideration to which Federated expects to be entitled in exchange for providing those services. This amount may be reduced by Fee Waivers . See Note (7) for information about current period Fee Waivers . Revenue from providing investment advisory, administrative and the majority of other service fees is recognized when a performance obligation is satisfied, which occurs when control of the services is transferred to customers. For these revenue streams, control is transferred over time as the customer simultaneously consumes the benefit of the service as it is provided. Federated utilizes a time-based measure of progress for which each day is a distinct service period over the life of the contract. Investment advisory, administrative and the majority of other service fees are generally calculated as a percentage of average net assets of the investment portfolios managed by Federated . Based on the nature of the calculation, the revenue for these services is accounted for as variable consideration, and is subject to factors outside of Federated's control including investor activity and market volatility and is recognized as these uncertainties are resolved. For the distribution performance obligation, control is transferred to the customer at a point in time upon investor subscription and/or redemption. Based on the nature of the calculation, the revenue for these services is accounted for as variable consideration, and is subject to factors outside of Federated's control including investor activity and market volatility and is recognized as these uncertainties are resolved. For certain revenue, primarily related to distribution fees, Federated may recognize revenue in the current period that pertains to performance obligations satisfied in prior periods, as it represents variable consideration and is recognized as uncertainties are resolved. The fair value of these investment portfolios managed by Federated is primarily determined using quoted market prices, independent third-party pricing services and broker/dealer price quotes or the NAV Practical Expedient. In limited circumstances, a quotation or price evaluation is not readily available from a pricing source. In these cases, pricing is determined by management based on a prescribed valuation process that has been approved by the directors/trustees of the Federated Funds . For each period presented, a de minimis amount of assets under management ( AUM ) was priced in this manner by Federated management. For Separate Accounts that are not registered investment companies under the Investment Company Act of 1940 ( 1940 Act ), the fair value of portfolio investments is primarily determined as specified in applicable customer agreements, including in agreements between the customer and the customer's third-party custodian. For Separate Accounts that are registered investment companies under the 1940 Act (e.g., sub-advised mutual funds), the fair value of portfolio investments is determined based on a prescribed valuation process approved by the board of directors/trustees of the sub-advised fund. Federated has contractual arrangements with third parties to provide certain fund-related services. Management considers whether Federated is acting as the principal service provider or as an agent to determine whether its revenue should be recorded based on the gross amount payable by the funds or net of payments to third-party service providers, respectively. Federated would be considered a principal service provider if it controls the service that is transferred to the customer. Alternatively, Federated would be considered an agent when it does not control the service, but rather arranges for the service to be provided by another party. Generally, the less the customer is directly involved with or participates in making decisions regarding the ultimate third-party service provider, the more supportive the facts are that Federated is acting as the principal in these transactions and should therefore report gross revenues. All of Federated's revenue is recorded gross of payments made to third parties. Significant judgments are used when reviewing newly-created contracts and/or materially-modified contracts to determine whether: (1) Federated is the principal or agent; (2) a contract has multiple performance obligations when Federated is paid a single fee; and (3) two or more contracts should be combined. A change in the conclusion of whether Federated is the principal or agent would result in a change in the revenue being recorded gross or net of payments made to third parties. Different conclusions for the remaining two judgments may change the line items to which revenue is being recorded. There are no significant judgments that would impact the timing of revenue recognition. Federated is not required to disclose estimates of revenue expected to be recorded in future periods as a result of applying the following exemptions: (1) contract terms are short-term in nature (i.e., expected duration of one year or less due to termination provisions) and (2) the expected variable consideration would be allocated entirely to future service periods. Investments Federated's investments are categorized as Investments—Consolidated Investment Companies or Investments—Affiliates and Other on the Consolidated Balance Sheets. Investments—Consolidated Investment Companies represent securities held by Federated as a result of consolidating certain Federated Funds . Investments—Affiliates and Other represent Federated's investments in fluctuating-value Federated Funds and investments held in Separate Accounts for which Federated owns the underlying debt and equity securities. All investments are carried at fair value with unrealized gains or losses on these securities recognized in (Loss) Gain on Securities, net on the Consolidated Statements of Income. Realized gains and losses on these securities are computed on a specific-identification basis and recognized in (Loss) Gain on Securities, net on the Consolidated Statements of Income. The fair value of Federated's investments is generally based on quoted market prices in active markets for identical instruments. If quoted market prices are not available, fair value is generally based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, or model-derived valuations in which all significant inputs and significant value drivers are observable in active markets. In the absence of observable market data inputs and/or value drivers, internally generated valuation techniques may be utilized in which one or more significant inputs or significant value drivers are unobservable in the market place. See Note (9) for additional information regarding the fair value of investments held as of June 30, 2018 and December 31, 2017 . Derivatives and Hedging Instruments From time to time, Federated may consolidate an investment product that holds freestanding derivative financial instruments for trading purposes. Federated reports such derivative instruments at fair value and records the changes in fair value in (Loss) Gain on Securities, net on the Consolidated Statements of Income. From time to time, Federated may also enter into derivative financial instruments to hedge against the risk of movement in foreign exchange rates. Federated records all derivative financial instruments as either assets or liabilities on its Consolidated Balance Sheets and measures these instruments at fair value. Federated has not designated any derivative financial instrument as a hedging instrument for accounting purposes. The gain or loss on derivative instruments not designated for hedge accounting is recognized in Other, net on the Consolidated Statements of Income. See Note (10) for additional information on current quarter derivative instruments. |
Business Combinations (Notes)
Business Combinations (Notes) | 6 Months Ended |
Jun. 30, 2018 | |
Business Combinations [Abstract] | |
Business Combination Disclosure [Text Block] | Business Combinations On April 12, 2018 , Federated entered into an agreement to acquire a majority interest in Hermes Fund Managers Limited ( Hermes ) from BT Pension Scheme ( BTPS ). The addition of London-based Hermes, which has had multi-year significant asset growth, will further accelerate Federated's growth in markets outside of the U.S. On July 2, 2018, Federated completed, effective as of July 1, 2018 , the acquisition of a 60 percent majority interest in Hermes ( Hermes Acquisition ). BTPS retained a 29.5 percent interest in Hermes and contributed the remaining 10.5 percent interest into an employee benefit trust for the benefit of certain members of Hermes' management and other key employees under a new long-term incentive plan. Federated paid a total of £259.9 million ( $343.3 million ) which included £246 million for the previously announced cost of the acquisition and an additional £13.9 million primarily for Federated's 60 percent share of Hermes' estimated excess regulatory capital. Federated funded the transaction through a combination of cash and an $18.0 million drawdown from its existing revolving credit facility (see Note (11) for additional information). Federated has incurred $4.6 million in transaction costs directly attributable to the Hermes Acquisition . Of this amount, $2.8 million has been expensed to date in 2018 , primarily recorded in Professional Service Fees on the Consolidated Statements of Income . The transaction costs exclude a derivative loss (see Note (10) for additional information) and a $1.7 million foreign exchange gain recognized in the second quarter of 2018 as a result of holding British pound sterling at quarter end. Federated anticipates future transaction costs of approximately $16 million , of which approximately $11 million may be recorded in the third quarter of 2018. Actual results may differ from these estimates, and such differences may be material to the Consolidated Financial Statements. Due to the timing of the Hermes Acquisition , the information necessary to complete the preliminary purchase price allocation and pro forma financial results are not yet available. This information will be available in connection with third quarter 2018 reporting. |
Revenue from Contracts with Cus
Revenue from Contracts with Customers (Notes) | 6 Months Ended |
Jun. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue [Table Text Block] | Revenue from Contracts with Customers The following table presents Federated's revenue disaggregated by asset class: Three Months Ended Six Months Ended (in thousands) June 30, 2018 June 30, 2018 Equity $ 112,558 $ 226,913 Money Market 98,923 203,406 Fixed-Income 44,512 89,526 Total Revenue $ 255,993 $ 519,845 The following table presents Federated's revenue disaggregated by performance obligation: Three Months Ended Six Months Ended (in thousands) June 30, 2018 June 30, 2018 Asset Management 1 $ 168,127 $ 342,393 Administrative Services 48,370 97,393 Distribution 2 36,923 74,980 Other 3 2,573 5,079 Total Revenue $ 255,993 $ 519,845 1 The performance obligation may include administrative, distribution and other services recorded as a single asset management fee under Topic 606 , as it is part of a unitary fee arrangement with a single performance obligation. 2 The performance obligation is satisfied at a point in time and may include CDSC's and upfront commissions. A portion of this revenue relates to a performance obligation that has been satisfied in a prior period. 3 Includes shareholder service fees recorded in Other Service Fees, net—Affiliates on the Consolidated Statements of Income. The following table presents Federated's revenue disaggregated by geographical market: Three Months Ended Six Months Ended (in thousands) June 30, 2018 June 30, 2018 Domestic $ 248,872 $ 504,964 Foreign 1 7,121 14,881 Total Revenue $ 255,993 $ 519,845 1 This represents revenue earned by non-U.S. domiciled subsidiaries. The following table presents Federated's revenue disaggregated by product type: Three Months Ended Six Months Ended (in thousands) June 30, 2018 June 30, 2018 Federated Funds $ 218,396 $ 443,213 Separate Accounts 37,597 76,632 Total Revenue $ 255,993 $ 519,845 |
Concentration Risk
Concentration Risk | 6 Months Ended |
Jun. 30, 2018 | |
Risks and Uncertainties [Abstract] | |
Concentration Risk | Concentration Risk (a) Revenue Concentration by Asset Class The following table summarizes the percentage of total revenue earned from Federated's asset classes for the periods presented: Six Months Ended June 30, 2018 2017 Equity Assets 44 % 42 % Money Market Assets 39 % 41 % Fixed-Income Assets 17 % 17 % The change in the relative proportion of Federated's revenue attributable to equity assets for the first six months of 2018 as compared to the same period in 2017 was primarily the result of higher average equity assets. The change in the relative proportion of Federated's revenue attributable to money market assets for the first six months of 2018 as compared to the same period in 2017 was primarily the result of a change in the mix of average money market assets and a decrease related to a January 2017 change in a customer relationship. Current Regulatory Environment Federated and its investment management business are subject to extensive regulation in the U.S. and abroad. Federated and its products, such as the Federated Funds , and strategies are subject to: federal securities laws, principally the Securities Act of 1933 ( 1933 Act ), the Securities Exchange Act of 1934 ( 1934 Act ), the 1940 Act , the Investment Advisers Act of 1940; state laws regarding securities fraud and registration; regulations or other rules, promulgated by various regulatory authorities, self-regulatory organizations or exchanges; and foreign laws, regulations or other rules promulgated by foreign regulatory or other authorities. See the Business Developments - Current Regulatory Environment section of Management's Discussion and Analysis for additional information about the current regulatory environment. (b) Revenue Concentration by Investment Strategy/Fund The following table presents Federated's revenue concentration by investment strategy/fund: Three Months Ended Six Months Ended June 30, June 30, 2018 2017 2018 2017 Federated Strategic Value Dividend strategy 1 16 % 18 % 17 % 18 % Federated Kaufmann Mid-Cap Growth strategy 2 11 % 9 % 11 % 8 % Federated Government Obligations Fund 10 % 10 % 10 % 10 % 1 Strategy includes Federated Funds and Separate Accounts . 2 Strategy includes Federated Funds . A significant and prolonged decline in the AUM in any of these strategies/funds could have a material adverse effect on Federated's future revenues and, to a lesser extent, net income, due to a related reduction in distribution expenses associated with the Federated Funds managed in accordance with these strategies/funds. (c) Revenue Concentration by Intermediary Approximately 14% of Federated's total revenue for both the three - and six-month period s ended June 30, 2018 and 17% and 16% for the three - and six-month period s ended June 30, 2017 , respectively, was derived from services provided to one intermediary, The Bank of New York Mellon Corporation, including its Pershing subsidiary. Significant negative changes in Federated's relationship with this intermediary could have a material adverse effect on Federated's future revenues and, to a lesser extent, net income due to a related reduction in distribution expenses associated with this intermediary. |
Consolidation
Consolidation | 6 Months Ended |
Jun. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Consolidation | Consolidation The Consolidated Financial Statements include the accounts of Federated, which include Federated Funds and other entities in which Federated holds a controlling financial interest. Federated is involved with various entities in the normal course of business that may be deemed to be voting rights entities ( VRE s) or variable interest entities ( VIE s). From time to time, Federated invests in Federated Funds for general corporate investment purposes or, in the case of newly launched products, in order to provide investable cash to establish a performance history. Federated's investment in these Federated Funds represents its maximum exposure to loss. The assets of each consolidated Federated Fund are restricted for use by the respective Federated Fund . Generally, neither creditors of, nor equity investors in, the Federated Funds have any recourse to Federated's general credit. Given that the entities follow investment company accounting, which prescribes fair-value accounting, a deconsolidation generally does not result in gains or losses for Federated. Receivables from all Federated Funds for advisory and other services totaled $23.0 million and $27.4 million at June 30, 2018 and December 31, 2017 , respectively. In the ordinary course of business, Federated may implement Fee Waivers for various Federated Funds for competitive, regulatory or contractual reasons. For the three and six months ended June 30, 2018 , Fee Waivers totaled $88.1 million and $175.5 million , respectively, of which $59.6 million and $117.5 million , respectively, related to money market funds which meet the scope exception of the consolidation guidance. For the three and six months ended June 30, 2017 , Fee Waivers totaled $84.8 million and $175.3 million , respectively, of which $53.8 million and $113.6 million , respectively, related to money market funds which meet the scope exception of the consolidation guidance. Like other sponsors of investment companies, Federated in the ordinary course of business may make capital contributions to certain money market Federated Funds in connection with the reorganization of such funds into certain affiliated money market Federated Funds or in connection with the liquidation of a money market Federated Fund . In these instances, such capital contributions typically are intended to either offset realized losses or other permanent impairments to a fund's net asset value ( NAV ) or increase the market-based NAV per share of the fund's portfolio that is being reorganized to equal the market-based NAV per share of the acquiring fund or to bear a portion of expenses relating to a fund liquidation. Under current money fund regulations and Securities and Exchange Commission ( SEC ) guidance, Federated is required to report these types of capital contributions to the SEC as financial support to the investment company that is being reorganized or liquidated. There were no contributions for the three and six months ended June 30, 2018 or June 30, 2017 . In accordance with Federated's consolidation accounting policy, Federated first determines whether the entity being evaluated is a VRE or a VIE. Once this determination is made, Federated proceeds with its evaluation of whether to consolidate the entity. The disclosures below represent the results of such evaluations as of June 30, 2018 and December 31, 2017 . (a) Consolidated Voting Rights Entities Most of the Federated Funds meet the definition of a VRE. Federated consolidates certain VREs when it is deemed to have control. As of June 30, 2018 and December 31, 2017 , consolidated VREs reported on Federated's Consolidated Balance Sheets included $1.9 million and $5.7 million , respectively, in Investments—Consolidated Investment Companies and $0.7 million and $2.5 million , respectively, in Redeemable Noncontrolling Interest in Subsidiaries . The decrease in these line items primarily relates to the deconsolidation of one Federated Fund VRE. (b) Consolidated Variable Interest Entities As of June 30, 2018 and December 31, 2017 , Federated was deemed to be the primary beneficiary of, and therefore consolidated, certain Federated Funds as a result of its controlling financial interest. The following table presents the balances related to the consolidated Federated Fund VIEs that were included on the Consolidated Balance Sheets as well as Federated's net interest in the consolidated Federated Fund VIEs for each period presented: (in millions) June 30, 2018 December 31, 2017 Cash and Cash Equivalents $ 0.0 $ 0.1 Investments—Consolidated Investment Companies 31.7 39.7 Receivables 0.5 1.0 Less: Liabilities 0.6 0.4 Less: Redeemable Noncontrolling Interest in Subsidiaries 20.3 27.7 Federated's Net Interest in Federated Fund VIEs $ 11.3 $ 12.7 Federated's net interest in the consolidated Federated Fund VIEs represents the value of Federated's economic ownership interest in these Federated Funds . The liabilities of the consolidated Federated Fund VIEs primarily represent operating liabilities of the entities. Federated did not newly consolidate or deconsolidate any VIEs during the six months ended June 30, 2018 . (c) Non-Consolidated Variable Interest Entities Federated's involvement with certain Federated Funds that are deemed to be VIEs includes serving as the investment manager, or at times, holding a minority interest or both. Federated's variable interest is not deemed to absorb losses or receive benefits that could potentially be significant to the VIE. Therefore, Federated is not the primary beneficiary of these VIEs and has not consolidated these entities. At June 30, 2018 and December 31, 2017 , Federated's investment and maximum risk of loss related to non-consolidated VIEs was $1.0 million and $0.9 million , respectively, (recorded in Investments—Affiliates and Other on the Consolidated Balance Sheets ) and was entirely related to one Federated Fund at the end of each period. AUM for these non-consolidated Federated Funds totaled $66.5 million and $55.8 million at June 30, 2018 and December 31, 2017 , respectively. |
Investments
Investments | 6 Months Ended |
Jun. 30, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments | Investments At June 30, 2018 and December 31, 2017 , Federated held investments in Separate Accounts of $6.2 million and $6.3 million , respectively, and investments in fluctuating-value Federated Funds of $2.6 million and $1.6 million , respectively, that were included in Investments—Affiliates and Other on the Consolidated Balance Sheets . Federated's investments held in Separate Accounts as of June 30, 2018 and December 31, 2017 , were primarily composed of domestic debt securities ( $2.9 million and $3.0 million , respectively) and stocks of large U.S. and international companies ( $2.5 million and $2.6 million , respectively). Federated consolidates certain Federated Funds into its Consolidated Financial Statements as a result of Federated's controlling financial interest in these Federated Funds (see Note (7) ). All investments held by these Federated Funds were included in Investments—Consolidated Investment Companies on Federated's Consolidated Balance Sheets . Federated's investments held by consolidated Federated Funds as of June 30, 2018 and December 31, 2017 , were primarily composed of domestic and foreign debt securities ( $31.3 million and $39.2 million , respectively) and stocks of small and medium-sized companies ( $3.8 million as of December 31, 2017 ). The following table presents gains and losses recognized in (Loss) Gain on Securities, net on the Consolidated Statements of Income in connection with Federated's investments: Three Months Ended Six Months Ended June 30, June 30, (in thousands) 2018 2017 2018 2017 Investments—Consolidated Investment Companies Unrealized (Losses) Gains $ (653 ) $ 389 $ (2,343 ) $ 1,096 Realized Gains 1 501 1,075 1,325 2,074 Realized Losses 1 (723 ) (131 ) (898 ) (699 ) Net (Losses) Gains on Investments—Consolidated Investment Companies (875 ) 1,333 (1,916 ) 2,471 Investments—Affiliates and Other Unrealized Gains (Losses) Recognized on Securities Still Held 9 11 (206 ) 271 Net Realized Gains Recognized on Securities Sold 1 51 890 125 2,054 Net Gains (Losses) on Investments—Affiliates and Other 60 901 (81 ) 2,325 (Loss) Gain on Securities, net $ (815 ) $ 2,234 $ (1,997 ) $ 4,796 1 Realized gains and losses are computed on a specific-identification basis. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Fair value is the price that would be received to sell an asset or the price that would be paid to transfer a liability as of the measurement date. A fair-value reporting hierarchy exists for disclosure of fair value measurements based on the observability of the inputs to the valuation of financial assets and liabilities. The levels are: Level 1 – Quoted prices for identical instruments in active markets. Level 1 assets may include equity and debt securities that are traded in an active exchange market, including shares of mutual funds. 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 in active markets. Level 2 assets and liabilities may include debt and equity securities, purchased loans and over-the-counter derivative contracts whose fair value is determined using a pricing model without significant unobservable market data inputs. Level 3 – Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable in active markets. NAV Practical Expedient – Investments that calculate NAV per share (or its equivalent) as a practical expedient. These investments have been excluded from the fair value hierarchy. (a) Fair Value Measurements on a Recurring Basis The following table presents fair value measurements for classes of Federated's financial assets and liabilities measured at fair value on a recurring basis: (in thousands) Level 1 Level 2 Level 3 NAV Practical Expedient Total June 30, 2018 Financial Assets Cash and Cash Equivalents $ 375,172 $ 0 $ 0 $ 0 $ 375,172 Investments—Consolidated Investment Companies Equity Securities 1,586 751 0 0 2,337 Debt Securities 0 31,266 0 0 31,266 Investments—Affiliates and Other Equity Securities 5,563 0 0 285 5,848 Debt Securities 0 2,938 0 0 2,938 Other 1 583 0 452 0 1,035 Total Financial Assets $ 382,904 $ 34,955 $ 452 $ 285 $ 418,596 Financial Liabilities Derivative Liabilities $ 0 $ 28,978 $ 0 $ 0 $ 28,978 Other 2 12 273 928 0 1,213 Total Financial Liabilities $ 12 $ 29,251 $ 928 $ 0 $ 30,191 December 31, 2017 Financial Assets Cash and Cash Equivalents $ 205,364 $ 0 $ 0 $ 110,900 $ 316,264 Investments—Consolidated Investment Companies Equity Securities 5,424 746 0 0 6,170 Debt Securities 0 39,241 0 0 39,241 Investments—Affiliates and Other Equity Securities 4,564 0 0 302 4,866 Debt Securities 0 2,997 0 0 2,997 Other 1 123 357 760 0 1,240 Total Financial Assets $ 215,475 $ 43,341 $ 760 $ 111,202 $ 370,778 Total Financial Liabilities 2 $ 0 $ 0 $ 1,203 $ 0 $ 1,203 1 Amounts include restricted cash, structured trade finance loans held by Federated as well as futures contracts and/or foreign currency forward contracts held within certain consolidated Federated Funds . 2 Amounts include acquisition-related future contingent consideration liabilities as well as certain liabilities attributable to structured trade finance loans held by Federated and may include foreign currency forward contracts and/or futures contracts held within certain consolidated Federated Funds . The following is a description of the valuation methodologies used for financial assets and liabilities measured at fair value on a recurring basis. Federated did not hold any nonfinancial assets or liabilities measured at fair value on a recurring basis at June 30, 2018 or December 31, 2017 . Cash and Cash Equivalents Cash and Cash Equivalents include deposits with banks and investments in money market funds. Investments in money market Federated Funds totaled $23.6 million and $309.1 million at June 30, 2018 and December 31, 2017 , respectively. Cash investments in publicly available money market funds are valued under the market approach through the use of quoted market prices in an active market, which is the NAV of the funds, and are classified within Level 1 of the valuation hierarchy. For an investment in a money market Federated Fund that is not publicly available but for which the NAV is calculated daily and for which there are no redemption restrictions, the security is valued using NAV as a practical expedient and is excluded from the fair value hierarchy. This investment is included in the NAV Practical Expedient column in the December 31, 2017 table above. Investments—Consolidated Investment Companies—Equity Securities Investments—Consolidated Investment Companies—Equity Securities represent equity securities held by consolidated Federated Funds . For publicly traded equity securities available in an active market, the fair value of these securities is classified as Level 1 when the fair value is based on quoted market prices. The fair value of certain equity securities traded principally in foreign markets and held by consolidated Federated Funds are determined by a third-party pricing service (Level 2). Investments—Consolidated Investment Companies—Debt Securities Investments—Consolidated Investment Companies—Debt Securities primarily represent domestic and foreign bonds held by consolidated Federated Funds . The fair value of these securities may include observable market data such as valuations provided by independent pricing services after considering factors such as the yields or prices of investments of comparable quality, coupon, maturity, call rights and other potential prepayments, terms and type, reported transactions, indications as to values from dealers and general market conditions (Level 2). Investments—Affiliates and Other—Equity Securities Investments—Affiliates and Other—Equity Securities primarily represent equity investments held in Separate Accounts as well as investments in fluctuating-value Federated Funds . For publicly traded equity securities available in an active market, the fair value of these securities is classified as Level 1 when the fair value is based on quoted market prices. For investments in Federated Funds that are publicly available, the securities are valued under the market approach through the use of quoted market prices available in an active market, which is the NAV of the funds, and are classified within Level 1 of the valuation hierarchy. For certain investments in Federated Funds and/or Separate Accounts that are not publicly available but for which the NAV is calculated daily and for which there are no redemption restrictions, the securities are valued using NAV as a practical expedient and are excluded from the fair value hierarchy. These investments are included in the NAV Practical Expedient column in the table above. Investments—Affiliates and Other—Debt Securities Investments—Affiliates and Other—Debt Securities primarily represent domestic bonds held by Separate Accounts . The fair value of these securities may include observable market data such as valuations provided by independent pricing services after considering factors such as the yields or prices of investments of comparable quality, coupon, maturity, call rights and other potential prepayments, terms and type, reported transactions, indications as to values from dealers and general market conditions (Level 2). Derivative Liabilities During the second quarter of 2018, Federated entered into foreign currency forward derivative financial instrument transactions (see Note (10) for additional information). These derivatives are valued using contract terms and observable British Pound Sterling currency exchange rates in active markets (Level 2). The derivatives are short-term in nature. (b) Fair Value Measurements on a Nonrecurring Basis Federated did not hold any assets or liabilities measured at fair value on a nonrecurring basis at June 30, 2018 . (c) Fair Value Measurements of Other Financial Instruments The fair value of Federated's debt is estimated by management using observable market data (Level 2). Based on this fair value estimate, the carrying value of debt appearing on the Consolidated Balance Sheets approximates fair value. |
Derivatives (Notes)
Derivatives (Notes) | 6 Months Ended |
Jun. 30, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments and Hedging Activities Disclosure [Text Block] | Derivatives On April 13, 2018 , Federated entered into a foreign currency forward derivative financial instrument with Citi Bank, N.A. ( Citi ) under an existing International Swaps and Derivatives Association, Inc. Master Agreement dated June 9, 2010 (ISDA) in order to hedge against foreign exchange rate fluctuations associated with the payment for the Hermes Acquisition . This forward was not designated as a hedging instrument for accounting purposes. Under this forward transaction, Federated committed to purchase £250 million at an all-in forward rate of 1.43192 (which is comprised of a spot rate of 1.42522 plus forward points of 0.00670 ) for settlement on August 1, 2018 . On June 27, 2018 , Federated entered into a second foreign currency forward transaction with Citi in which Federated committed to sell £250 million at an all-in forward rate of 1.31601 (which is comprised of a spot rate of 1.31400 plus forward points of 0.00201 ) for settlement on August 1, 2018 . This second forward allowed Federated to effectively close the initial forward to lock in the foreign exchange rate and amount due on August 1, 2018. The change in the spot rate and a reduction in the forward points will result in a payment of $29.0 million to Citi on August 1, 2018 when both derivatives are settled. While these derivatives are subject to an enforceable master netting arrangement as allowed by the ISDA, both are currently in a liability position and are recorded gross and at fair value in Other Current Liabilities as of June 30, 2018 on the Consolidated Balance Sheets, totaling $29.0 million . The $29.0 million change in fair value of these derivatives was recorded as a nonoperating expense in Other, net on the Consolidated Statements of Income during the three-month period ended June 30, 2018 . |
Debt
Debt | 6 Months Ended |
Jun. 30, 2018 | |
Debt Disclosure [Abstract] | |
Debt Disclosure | Debt On June 5, 2017 , Federated entered into an unsecured Third Amended and Restated Credit Agreement by and among Federated, certain of its subsidiaries as guarantors party thereto, a syndicate of ten banks as Lenders party thereto, PNC Bank, National Association as administrative agent, PNC Capital Markets LLC, as sole bookrunner and joint lead arranger, Citigroup Global Markets, Inc., as joint lead arranger, Citibank, N.A. as syndication agent, and TD Bank, N.A. as documentation agent ( Credit Agreement ). The Credit Agreement amended and restated Federated's prior unsecured Second Amended and Restated Credit Agreement, which was dated June 24, 2014 and scheduled to mature on June 24, 2019 ( Prior Credit Agreement ). The Credit Agreement refinanced $200 million available on the revolving credit facility and $178.5 million outstanding on the term loan facility under the Prior Credit Agreement , replacing both with a $375 million revolving credit facility which has an additional $200 million available via an optional increase (or accordion) feature. The interest on the revolving credit facility is calculated at the monthly London Interbank Offering Rate ( LIBOR ) plus a spread. The borrowings under the revolving credit facility may include up to $25 million for which interest is calculated at the daily LIBOR plus a spread ( Swing Line ). Federated had no borrowings under the previous revolving credit facility. The Credit Agreement does not include a term loan facility. On July 1, 2018, Federated entered into an amendment to the Credit Agreement to add certain definitions and to amend certain negative covenants relating to indebtedness, guaranties, and restrictions on dividends, related to the Hermes Acquisition . This amendment contains other customary conditions, representations, warranties and covenants. The Credit Agreement , which expires on June 5, 2022, has no principal payment schedule, but instead requires that any outstanding principal be repaid by the expiration date. Federated, however, may elect to make discretionary principal payments prior to the expiration date. During the quarter ended June 30, 2018 , and in conjunction with the Hermes Acquisition , Federated borrowed $18.0 million on the Swing Line which was fully repaid by July 16, 2018. Debt consisted of the following: Interest Rates (dollars in thousands) June 30, 2018 December 31, 2017 June 30, 2018 December 31, 2017 Revolving Credit Facility 3.107 % 2.486 % $ 160,000 $ 170,000 Swing Line 1 3.216 % N/A 18,000 0 Long-Term Debt $ 178,000 $ 170,000 1 Represents the weighted-average interest rate for the period in which a balance is outstanding. The commitment fee under the Credit Agreement currently is 0.125% per annum on the daily unused portion of each Lender's commitment. As of June 30, 2018 , Federated has $197 million available for borrowings. The Credit Agreement , similar to the Prior Credit Agreement , includes representations and warranties, affirmative and negative financial covenants, including an interest coverage ratio covenant and a leverage ratio covenant, reporting requirements and other non-financial covenants. Federated was in compliance with all covenants at and during the six months ended June 30, 2018 (see the Liquidity and Capital Resources section of Management's Discussion and Analysis for additional information). The Credit Agreement also has certain stated events of default and cross default provisions which would permit the lenders/counterparties to accelerate the repayment of debt outstanding if not cured within the applicable grace periods. The events of default generally include breaches of contract, failure to make required loan payments, insolvency, cessation of business, notice of lien or assessment, and other proceedings, whether voluntary or involuntary, that would require the repayment of amounts borrowed. The Credit Agreement also requires certain subsidiaries to enter into a Second Amended and Restated Continuing Agreement of Guaranty and Suretyship to guarantee payment of all obligations incurred through the Credit Agreement . |
Share-Based Compensation Plans
Share-Based Compensation Plans | 6 Months Ended |
Jun. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-Based Compensation Plans | Share-Based Compensation Plans During the first six months of 2018 , Federated awarded 486,769 shares of restricted Federated Class B common stock, nearly all of which was granted in connection with a bonus program in which certain key employees received a portion of their bonus in the form of restricted stock under Federated's Stock Incentive Plan. This restricted stock, which was granted on the bonus payment date and issued out of treasury, will generally vest over a three -year period. The remaining shares were awarded to certain key employees and generally vest over a ten -year period. During 2017 , Federated awarded 946,570 shares of restricted Federated Class B common stock under its Stock Incentive Plan. Of this amount, 513,570 shares were awarded in connection with the aforementioned bonus program in 2017 . The remaining shares were awarded to certain key employees and generally vest over a ten -year period. |
Equity
Equity | 6 Months Ended |
Jun. 30, 2018 | |
Equity [Abstract] | |
Equity | Equity In October 2016 , the board of directors authorized a share repurchase program with no stated expiration date that allows Federated to buy back up to 4 million shares of Federated Class B common stock. No other programs existed as of June 30, 2018. The program authorizes executive management to determine the timing and the amount of shares for each purchase. The repurchased stock is to be held in treasury for employee share-based compensation plans, potential acquisitions and other corporate activities, unless Federated's board of directors subsequently determines to retire the repurchased stock and restore the shares to authorized but unissued status (rather than holding the shares in treasury). During the first six months of 2018 , Federated repurchased 0.8 million shares of its Class B common stock for $21.0 million , nearly all of which were repurchased in the open market. At June 30, 2018 , 1.4 million shares remain available to be purchased under Federated's buyback program. |
Earnings Per Share Attributable
Earnings Per Share Attributable to Federated Investors, Inc. Shareholders | 6 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share [Abstract] | |
Earnings Per Share Attributable to Federated Investors, Inc. Shareholders | Earnings Per Share Attributable to Federated Investors, Inc. Shareholders The following table sets forth the computation of basic and diluted earnings per share using the two-class method for amounts attributable to Federated: Three Months Ended Six Months Ended June 30, June 30, (in thousands, except per share data) 2018 2017 2018 2017 Numerator – Basic and Diluted Net Income Attributable to Federated Investors, Inc. $ 38,822 $ 53,451 $ 99,153 $ 103,092 Less: Total Income Available to Participating Unvested Restricted Shareholders 1 (1,529 ) (2,159 ) (3,907 ) (4,122 ) Total Net Income Attributable to Federated Common Stock 2 $ 37,293 $ 51,292 $ 95,246 $ 98,970 Denominator Basic Weighted-Average Federated Common Stock 2 97,193 97,581 97,191 97,722 Dilutive Potential Shares from Stock Options 1 1 1 1 Diluted Weighted-Average Federated Common Stock 2 97,194 97,582 97,192 97,723 Earnings Per Share Net Income Attributable to Federated Common Stock – Basic and Diluted 2 $ 0.38 $ 0.53 $ 0.98 $ 1.01 1 Income available to participating unvested restricted shareholders includes dividends paid on unvested restricted shares and their proportionate share of undistributed earnings. 2 Federated Common Stock excludes unvested restricted shares which are deemed participating securities in accordance with the two-class method of computing earnings per share. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies (a) Contractual Federated may be required to make certain compensation-related payments through 2023 in connection with various significant employment and incentive arrangements. Federated is obligated to make future minimum compensation payments of approximately $9 million . Based on asset levels as of June 30, 2018 and performance goals, incentive payments could total up to an additional $31 million over the remaining terms of these arrangements. (b) Guarantees and Indemnifications On an intercompany basis, various wholly owned subsidiaries of Federated guarantee certain financial obligations of Federated Investors, Inc., and Federated Investors, Inc. guarantees certain financial and performance-related obligations of various wholly owned subsidiaries. In addition, in the normal course of business, Federated has entered into contracts that provide a variety of indemnifications. Typically, obligations to indemnify third parties arise in the context of contracts entered into by Federated, under which Federated agrees to hold the other party harmless against losses arising out of the contract, provided the other party's actions are not deemed to have breached an agreed-upon standard of care. In each of these circumstances, payment by Federated is contingent on the other party making a claim for indemnity, subject to Federated's right to challenge the other party's claim. Further, Federated's obligations under these agreements may be limited in terms of time and/or amount. It is not possible to predict the maximum potential amount of future payments under these or similar agreements due to the conditional nature of Federated's obligations and the unique facts and circumstances involved in each particular agreement. As of June 30, 2018 , management does not believe that a material loss related to any of these matters is reasonably possible. (c) Legal Proceedings Like other companies, Federated has claims asserted and threatened against it in the ordinary course of business. As of June 30, 2018 , Federated does not believe that a material loss related to these claims is reasonably possible. See Item 1A - Risk Factors included in Federated's Annual Report on Form 10-K for the year ended December 31, 2017 for additional information regarding risks related to claims asserted or threatened against Federated. |
Income Taxes (Notes)
Income Taxes (Notes) | 6 Months Ended |
Jun. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Tax Disclosure [Text Block] | Income Taxes On December 22, 2017, the Tax Act was signed into law. The Tax Act significantly modified the federal tax code and, among other changes, reduced the federal corporate income tax rate from a maximum of 35% to a flat 21% . In addition, as a result of this rate change, Federated's 2017 results included a $70.4 million reduction to the income tax provision resulting from the revaluation of its net deferred tax liability. This represents a provisional estimate based on management's initial analysis and interpretation of the legislation. Given the complexity of the legislation, anticipated guidance from the U.S. Department of Treasury ( Treasury Department ) and the potential for additional guidance from the SEC and/or the FASB, this estimate may be adjusted during 2018. As of June 30, 2018 , management does not anticipate a material change to the estimate. The Tax Act's international provisions regarding Global Intangible Low-Taxed Income ( GILTI ) and the Base Erosion Anti-Avoidance Tax ( BEAT ) are not expected to have a material impact on Federated's financial statements. However, this assessment is based on preliminary review and analysis of these provisions and may change as Federated continues its evaluation of these highly complex rules, for which interpretive guidance is needed and expected. In addition, the Hermes Acquisition increases the potential impact of these U.S. international tax provisions. In January 2018, the FASB released guidance on the accounting for the GILTI provisions, indicating that a company can elect an accounting policy either to account for the GILTI tax as an expense in the period incurred or to factor the GILTI tax into the measurement of deferred taxes. As Federated requires additional time to evaluate the GILTI provisions and their accounting implications, it has not yet elected its accounting policy with regard to this item. |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events On July 2, 2018 , Federated completed the Hermes Acquisition . See Note (4) for additional information. On July 26, 2018 , the board of directors declared a $0.27 per share dividend to shareholders of record as of August 8, 2018 to be paid on August 15, 2018 . |
Significant Accounting Polici25
Significant Accounting Policies Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Commissions, Policy [Policy Text Block] | Deferred Sales Commissions Federated pays upfront commissions to broker/dealers ( Deferred Sales Commissions ) to promote the sale of certain fund shares. For share classes that pay both a distribution fee and a CDSC, Federated generally capitalizes the Deferred Sales Commissions. The deferred sales commission asset (included in Other Long-Term Assets on the Consolidated Balance Sheets ) is amortized over the estimated period of benefit of six years . Deferred sales commission amortization expense was $1.6 million and $4.9 million for the six months ended June 30, 2018 and 2017 , respectively, and was included in Distribution expense on the Consolidated Statements of Income . Federated reviews the carrying value of deferred sales commission assets on a periodic basis to determine whether a significant long-term decline in the equity or bond markets or other events or circumstances indicate that an impairment in value may have occurred. Should there be an indication of an impairment in value, Federated compares the carrying value of the asset to the probability-weighted undiscounted future cash flows of the underlying asset to determine whether an impairment has occurred. If the carrying value of the asset exceeds the undiscounted future cash flows, the deferred sales commission asset is written down to its estimated fair value determined using discounted future cash flows. There were no impairments to the deferred sales commission asset during the six months ended June 30, 2018 and 2017 . For share classes that do not pay both a distribution fee and CDSC, Federated may be entitled to receive an upfront commission, which is collected from subscribing shareholders and recognized as revenue in Other Service Fees, net—Affiliates on the Consolidated Statements of Income upon investor subscription. For Deferred Sales Commissions that are not capitalized, the Deferred Sales Commissions paid are expensed as incurred and totaled $2.6 million and $0.8 million as of June 30, 2018 and 2017 , respectively, and were included in Distribution expense on the Consolidated Statements of Income . |
Revenue Recognition, Policy [Policy Text Block] | Revenue Recognition All of Federated's revenue is earned from contracts with customers, which are generally terminable upon no more than 60 days' notice. Revenue is measured in an amount that reflects the consideration to which Federated expects to be entitled in exchange for providing those services. This amount may be reduced by Fee Waivers . See Note (7) for information about current period Fee Waivers . Revenue from providing investment advisory, administrative and the majority of other service fees is recognized when a performance obligation is satisfied, which occurs when control of the services is transferred to customers. For these revenue streams, control is transferred over time as the customer simultaneously consumes the benefit of the service as it is provided. Federated utilizes a time-based measure of progress for which each day is a distinct service period over the life of the contract. Investment advisory, administrative and the majority of other service fees are generally calculated as a percentage of average net assets of the investment portfolios managed by Federated . Based on the nature of the calculation, the revenue for these services is accounted for as variable consideration, and is subject to factors outside of Federated's control including investor activity and market volatility and is recognized as these uncertainties are resolved. For the distribution performance obligation, control is transferred to the customer at a point in time upon investor subscription and/or redemption. Based on the nature of the calculation, the revenue for these services is accounted for as variable consideration, and is subject to factors outside of Federated's control including investor activity and market volatility and is recognized as these uncertainties are resolved. For certain revenue, primarily related to distribution fees, Federated may recognize revenue in the current period that pertains to performance obligations satisfied in prior periods, as it represents variable consideration and is recognized as uncertainties are resolved. The fair value of these investment portfolios managed by Federated is primarily determined using quoted market prices, independent third-party pricing services and broker/dealer price quotes or the NAV Practical Expedient. In limited circumstances, a quotation or price evaluation is not readily available from a pricing source. In these cases, pricing is determined by management based on a prescribed valuation process that has been approved by the directors/trustees of the Federated Funds . For each period presented, a de minimis amount of assets under management ( AUM ) was priced in this manner by Federated management. For Separate Accounts that are not registered investment companies under the Investment Company Act of 1940 ( 1940 Act ), the fair value of portfolio investments is primarily determined as specified in applicable customer agreements, including in agreements between the customer and the customer's third-party custodian. For Separate Accounts that are registered investment companies under the 1940 Act (e.g., sub-advised mutual funds), the fair value of portfolio investments is determined based on a prescribed valuation process approved by the board of directors/trustees of the sub-advised fund. Federated has contractual arrangements with third parties to provide certain fund-related services. Management considers whether Federated is acting as the principal service provider or as an agent to determine whether its revenue should be recorded based on the gross amount payable by the funds or net of payments to third-party service providers, respectively. Federated would be considered a principal service provider if it controls the service that is transferred to the customer. Alternatively, Federated would be considered an agent when it does not control the service, but rather arranges for the service to be provided by another party. Generally, the less the customer is directly involved with or participates in making decisions regarding the ultimate third-party service provider, the more supportive the facts are that Federated is acting as the principal in these transactions and should therefore report gross revenues. All of Federated's revenue is recorded gross of payments made to third parties. Significant judgments are used when reviewing newly-created contracts and/or materially-modified contracts to determine whether: (1) Federated is the principal or agent; (2) a contract has multiple performance obligations when Federated is paid a single fee; and (3) two or more contracts should be combined. A change in the conclusion of whether Federated is the principal or agent would result in a change in the revenue being recorded gross or net of payments made to third parties. Different conclusions for the remaining two judgments may change the line items to which revenue is being recorded. There are no significant judgments that would impact the timing of revenue recognition. Federated is not required to disclose estimates of revenue expected to be recorded in future periods as a result of applying the following exemptions: (1) contract terms are short-term in nature (i.e., expected duration of one year or less due to termination provisions) and (2) the expected variable consideration would be allocated entirely to future service periods. |
Investment, Policy [Policy Text Block] | Investments Federated's investments are categorized as Investments—Consolidated Investment Companies or Investments—Affiliates and Other on the Consolidated Balance Sheets. Investments—Consolidated Investment Companies represent securities held by Federated as a result of consolidating certain Federated Funds . Investments—Affiliates and Other represent Federated's investments in fluctuating-value Federated Funds and investments held in Separate Accounts for which Federated owns the underlying debt and equity securities. All investments are carried at fair value with unrealized gains or losses on these securities recognized in (Loss) Gain on Securities, net on the Consolidated Statements of Income. Realized gains and losses on these securities are computed on a specific-identification basis and recognized in (Loss) Gain on Securities, net on the Consolidated Statements of Income. The fair value of Federated's investments is generally based on quoted market prices in active markets for identical instruments. If quoted market prices are not available, fair value is generally based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, or model-derived valuations in which all significant inputs and significant value drivers are observable in active markets. In the absence of observable market data inputs and/or value drivers, internally generated valuation techniques may be utilized in which one or more significant inputs or significant value drivers are unobservable in the market place. See Note (9) for additional information regarding the fair value of investments held as of June 30, 2018 and December 31, 2017 . |
Derivatives, Policy [Policy Text Block] | Derivatives and Hedging Instruments From time to time, Federated may consolidate an investment product that holds freestanding derivative financial instruments for trading purposes. Federated reports such derivative instruments at fair value and records the changes in fair value in (Loss) Gain on Securities, net on the Consolidated Statements of Income. From time to time, Federated may also enter into derivative financial instruments to hedge against the risk of movement in foreign exchange rates. Federated records all derivative financial instruments as either assets or liabilities on its Consolidated Balance Sheets and measures these instruments at fair value. Federated has not designated any derivative financial instrument as a hedging instrument for accounting purposes. The gain or loss on derivative instruments not designated for hedge accounting is recognized in Other, net on the Consolidated Statements of Income. See Note (10) for additional information on current quarter derivative instruments. |
Revenue from Contracts with C26
Revenue from Contracts with Customers Revenue from Contracts with Customers - By Asset Class (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from External Customers by Asset Class [Table Text Block] | The following table presents Federated's revenue disaggregated by asset class: Three Months Ended Six Months Ended (in thousands) June 30, 2018 June 30, 2018 Equity $ 112,558 $ 226,913 Money Market 98,923 203,406 Fixed-Income 44,512 89,526 Total Revenue $ 255,993 $ 519,845 |
Revenue from Contracts with C27
Revenue from Contracts with Customers Revenue from Contracts with Customers - By performance obligation (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from External Customers by Products and Services [Table Text Block] | The following table presents Federated's revenue disaggregated by performance obligation: Three Months Ended Six Months Ended (in thousands) June 30, 2018 June 30, 2018 Asset Management 1 $ 168,127 $ 342,393 Administrative Services 48,370 97,393 Distribution 2 36,923 74,980 Other 3 2,573 5,079 Total Revenue $ 255,993 $ 519,845 1 The performance obligation may include administrative, distribution and other services recorded as a single asset management fee under Topic 606 , as it is part of a unitary fee arrangement with a single performance obligation. 2 The performance obligation is satisfied at a point in time and may include CDSC's and upfront commissions. A portion of this revenue relates to a performance obligation that has been satisfied in a prior period. 3 Includes shareholder service fees recorded in Other Service Fees, net—Affiliates on the Consolidated Statements of Income. |
Revenue from Contracts with C28
Revenue from Contracts with Customers Revenue from Contracts with Customers - By Geographic Location (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Revenue from external customers by geographic areas [Line Items] | |
Revenue from External Customers by Geographic Areas [Table Text Block] | The following table presents Federated's revenue disaggregated by geographical market: Three Months Ended Six Months Ended (in thousands) June 30, 2018 June 30, 2018 Domestic $ 248,872 $ 504,964 Foreign 1 7,121 14,881 Total Revenue $ 255,993 $ 519,845 1 This represents revenue earned by non-U.S. domiciled subsidiaries. |
Revenue from Contracts with C29
Revenue from Contracts with Customers Revenue from Contracts with Customers - By Product Type (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Revenue from Contracts with Customers - By Product Type [Line Items] | |
Revenue from External Customers By Product Type [Table Text Block] | The following table presents Federated's revenue disaggregated by product type: Three Months Ended Six Months Ended (in thousands) June 30, 2018 June 30, 2018 Federated Funds $ 218,396 $ 443,213 Separate Accounts 37,597 76,632 Total Revenue $ 255,993 $ 519,845 |
Concentration Risk (Tables)
Concentration Risk (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Risks and Uncertainties [Abstract] | |
Schedule of Revenue Concentration | The following table summarizes the percentage of total revenue earned from Federated's asset classes for the periods presented: Six Months Ended June 30, 2018 2017 Equity Assets 44 % 42 % Money Market Assets 39 % 41 % Fixed-Income Assets 17 % 17 % The following table presents Federated's revenue concentration by investment strategy/fund: Three Months Ended Six Months Ended June 30, June 30, 2018 2017 2018 2017 Federated Strategic Value Dividend strategy 1 16 % 18 % 17 % 18 % Federated Kaufmann Mid-Cap Growth strategy 2 11 % 9 % 11 % 8 % Federated Government Obligations Fund 10 % 10 % 10 % 10 % 1 Strategy includes Federated Funds and Separate Accounts . 2 Strategy includes Federated Funds . |
Variable Interest Entities (Tab
Variable Interest Entities (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Variable Interest Entities [Abstract] | |
Consolidated Federated Funds VIEs | The following table presents the balances related to the consolidated Federated Fund VIEs that were included on the Consolidated Balance Sheets as well as Federated's net interest in the consolidated Federated Fund VIEs for each period presented: (in millions) June 30, 2018 December 31, 2017 Cash and Cash Equivalents $ 0.0 $ 0.1 Investments—Consolidated Investment Companies 31.7 39.7 Receivables 0.5 1.0 Less: Liabilities 0.6 0.4 Less: Redeemable Noncontrolling Interest in Subsidiaries 20.3 27.7 Federated's Net Interest in Federated Fund VIEs $ 11.3 $ 12.7 |
Investments (Tables)
Investments (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |
Gains and losses on investments | The following table presents gains and losses recognized in (Loss) Gain on Securities, net on the Consolidated Statements of Income in connection with Federated's investments: Three Months Ended Six Months Ended June 30, June 30, (in thousands) 2018 2017 2018 2017 Investments—Consolidated Investment Companies Unrealized (Losses) Gains $ (653 ) $ 389 $ (2,343 ) $ 1,096 Realized Gains 1 501 1,075 1,325 2,074 Realized Losses 1 (723 ) (131 ) (898 ) (699 ) Net (Losses) Gains on Investments—Consolidated Investment Companies (875 ) 1,333 (1,916 ) 2,471 Investments—Affiliates and Other Unrealized Gains (Losses) Recognized on Securities Still Held 9 11 (206 ) 271 Net Realized Gains Recognized on Securities Sold 1 51 890 125 2,054 Net Gains (Losses) on Investments—Affiliates and Other 60 901 (81 ) 2,325 (Loss) Gain on Securities, net $ (815 ) $ 2,234 $ (1,997 ) $ 4,796 1 Realized gains and losses are computed on a specific-identification basis. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Classes of Financial Assets and Liabilities Measured at Fair Value on Recurring Basis | The following table presents fair value measurements for classes of Federated's financial assets and liabilities measured at fair value on a recurring basis: (in thousands) Level 1 Level 2 Level 3 NAV Practical Expedient Total June 30, 2018 Financial Assets Cash and Cash Equivalents $ 375,172 $ 0 $ 0 $ 0 $ 375,172 Investments—Consolidated Investment Companies Equity Securities 1,586 751 0 0 2,337 Debt Securities 0 31,266 0 0 31,266 Investments—Affiliates and Other Equity Securities 5,563 0 0 285 5,848 Debt Securities 0 2,938 0 0 2,938 Other 1 583 0 452 0 1,035 Total Financial Assets $ 382,904 $ 34,955 $ 452 $ 285 $ 418,596 Financial Liabilities Derivative Liabilities $ 0 $ 28,978 $ 0 $ 0 $ 28,978 Other 2 12 273 928 0 1,213 Total Financial Liabilities $ 12 $ 29,251 $ 928 $ 0 $ 30,191 December 31, 2017 Financial Assets Cash and Cash Equivalents $ 205,364 $ 0 $ 0 $ 110,900 $ 316,264 Investments—Consolidated Investment Companies Equity Securities 5,424 746 0 0 6,170 Debt Securities 0 39,241 0 0 39,241 Investments—Affiliates and Other Equity Securities 4,564 0 0 302 4,866 Debt Securities 0 2,997 0 0 2,997 Other 1 123 357 760 0 1,240 Total Financial Assets $ 215,475 $ 43,341 $ 760 $ 111,202 $ 370,778 Total Financial Liabilities 2 $ 0 $ 0 $ 1,203 $ 0 $ 1,203 1 Amounts include restricted cash, structured trade finance loans held by Federated as well as futures contracts and/or foreign currency forward contracts held within certain consolidated Federated Funds . 2 Amounts include acquisition-related future contingent consideration liabilities as well as certain liabilities attributable to structured trade finance loans held by Federated and may include foreign currency forward contracts and/or futures contracts held within certain consolidated Federated Funds . |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Debt [Table Text Block] | Debt consisted of the following: Interest Rates (dollars in thousands) June 30, 2018 December 31, 2017 June 30, 2018 December 31, 2017 Revolving Credit Facility 3.107 % 2.486 % $ 160,000 $ 170,000 Swing Line 1 3.216 % N/A 18,000 0 Long-Term Debt $ 178,000 $ 170,000 1 Represents the weighted-average interest rate for the period in which a balance is outstanding. |
Earnings Per Share Attributab35
Earnings Per Share Attributable to Federated Investors, Inc. Shareholders (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic, by Common Class, Including Two Class Method [Table Text Block] | The following table sets forth the computation of basic and diluted earnings per share using the two-class method for amounts attributable to Federated: Three Months Ended Six Months Ended June 30, June 30, (in thousands, except per share data) 2018 2017 2018 2017 Numerator – Basic and Diluted Net Income Attributable to Federated Investors, Inc. $ 38,822 $ 53,451 $ 99,153 $ 103,092 Less: Total Income Available to Participating Unvested Restricted Shareholders 1 (1,529 ) (2,159 ) (3,907 ) (4,122 ) Total Net Income Attributable to Federated Common Stock 2 $ 37,293 $ 51,292 $ 95,246 $ 98,970 Denominator Basic Weighted-Average Federated Common Stock 2 97,193 97,581 97,191 97,722 Dilutive Potential Shares from Stock Options 1 1 1 1 Diluted Weighted-Average Federated Common Stock 2 97,194 97,582 97,192 97,723 Earnings Per Share Net Income Attributable to Federated Common Stock – Basic and Diluted 2 $ 0.38 $ 0.53 $ 0.98 $ 1.01 1 Income available to participating unvested restricted shareholders includes dividends paid on unvested restricted shares and their proportionate share of undistributed earnings. 2 Federated Common Stock excludes unvested restricted shares which are deemed participating securities in accordance with the two-class method of computing earnings per share. |
Schedule of Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Table Text Block] | The following table sets forth the computation of basic and diluted earnings per share using the two-class method for amounts attributable to Federated: Three Months Ended Six Months Ended June 30, June 30, (in thousands, except per share data) 2018 2017 2018 2017 Numerator – Basic and Diluted Net Income Attributable to Federated Investors, Inc. $ 38,822 $ 53,451 $ 99,153 $ 103,092 Less: Total Income Available to Participating Unvested Restricted Shareholders 1 (1,529 ) (2,159 ) (3,907 ) (4,122 ) Total Net Income Attributable to Federated Common Stock 2 $ 37,293 $ 51,292 $ 95,246 $ 98,970 Denominator Basic Weighted-Average Federated Common Stock 2 97,193 97,581 97,191 97,722 Dilutive Potential Shares from Stock Options 1 1 1 1 Diluted Weighted-Average Federated Common Stock 2 97,194 97,582 97,192 97,723 Earnings Per Share Net Income Attributable to Federated Common Stock – Basic and Diluted 2 $ 0.38 $ 0.53 $ 0.98 $ 1.01 1 Income available to participating unvested restricted shareholders includes dividends paid on unvested restricted shares and their proportionate share of undistributed earnings. 2 Federated Common Stock excludes unvested restricted shares which are deemed participating securities in accordance with the two-class method of computing earnings per share. |
Recent Accounting Pronounceme36
Recent Accounting Pronouncements Recent Accounting Pronouncements Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Jan. 01, 2018 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 255,993 | $ 272,796 | $ 519,845 | $ 546,297 | |
Retained Earnings [Member] | Accounting Standards Update 2014-09 [Member] | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Cumulative Effect of New Accounting Principle in Period of Adoption - Change in Amortization Period | $ (8,100) | ||||
Cumulative Effect of New Accounting Principle in Period of Adoption - CDSC Revenue | 8,000 | ||||
Other Noncurrent Assets [Member] | Accounting Standards Update 2014-09 [Member] | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Cumulative Effect of New Accounting Principle in Period of Adoption - Change in Amortization Period | 8,100 | ||||
Cumulative Effect of New Accounting Principle in Period of Adoption - CDSC Revenue | $ (8,000) | ||||
Distribution and Shareholder Service [Member] | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | 39,496 | 46,414 | 80,059 | 90,373 | |
Distribution and Shareholder Service [Member] | Accounting Standards Update 2014-09 [Member] | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | 500 | 800 | |||
Investment Advice-Affiliates [Member] | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | 130,531 | 145,205 | 265,762 | 293,124 | |
Investment Advice-Affiliates [Member] | Accounting Standards Update 2014-09 [Member] | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | (8,200) | (16,800) | |||
Investment Advice-Other [Member] | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | 37,596 | $ 34,117 | 76,631 | $ 67,515 | |
Investment Advice-Other [Member] | Accounting Standards Update 2014-09 [Member] | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 1,600 | $ 3,300 |
Significant Accounting Polici37
Significant Accounting Policies summary of significant accounting policies narrative (Details) - USD ($) | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Deferred Sales Commission Asset Estimated Period Of Benefit | 6 years | |
Amortization of Deferred Sales Commissions | $ 1,614,000 | $ 4,879,000 |
Other Asset Impairment Charges | 0 | 0 |
Deferred Sales Commission Expensed When Incurred | $ 2,600,000 | $ 800,000 |
Business Combinations (Details)
Business Combinations (Details) £ in Thousands, $ in Thousands | Jul. 01, 2018GBP (£) | Jul. 01, 2018USD ($) | Apr. 12, 2018 | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Dec. 31, 2018USD ($) | Jun. 30, 2018USD ($) | Jun. 30, 2017USD ($) |
Business Acquisition [Line Items] | ||||||||
Business Acquisition, Date of Acquisition Agreement | Apr. 12, 2018 | |||||||
Business Acquisition, Effective Date of Acquisition | Jul. 1, 2018 | Jul. 1, 2018 | ||||||
Business Acquisition, Percentage of Voting Interests Acquired | 60.00% | 60.00% | ||||||
Payments to Acquire Businesses, Gross | £ 259,900 | $ 343,300 | ||||||
Proceeds from New Borrowings | $ 18,000 | $ 18,000 | $ 0 | |||||
Business Acquisition, Transaction Costs | 4,600 | 4,600 | ||||||
Business Combination, Acquisition Related Costs | $ 2,800 | |||||||
Foreign Currency Transaction Gain (Loss), Realized | $ 1,700 | |||||||
BT Pension Scheme [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 29.50% | 29.50% | ||||||
Hermes Management [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 10.50% | 10.50% | ||||||
Acquisition Cost [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Payments to Acquire Businesses, Gross | £ | £ 246,000 | |||||||
Excess Regulatory Capital [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Payments to Acquire Businesses, Gross | £ | £ 13,900 | |||||||
Scenario, Forecast [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Business Combination, Acquisition Related Costs | $ 11,000 | $ 16,000 |
Revenue from Contracts with C39
Revenue from Contracts with Customers (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Revenue From External Customers by Asset Class [Line Items] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 255,993 | $ 272,796 | $ 519,845 | $ 546,297 |
Equity [Member] | ||||
Revenue From External Customers by Asset Class [Line Items] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 112,558 | 226,913 | ||
Money Market [Member] | ||||
Revenue From External Customers by Asset Class [Line Items] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 98,923 | 203,406 | ||
Fixed-Income [Member] | ||||
Revenue From External Customers by Asset Class [Line Items] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 44,512 | $ 89,526 |
Revenue from Contracts with C40
Revenue from Contracts with Customers Revenue from Contracts with Customers - By Performance Obligation (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | ||
Revenue from External Customer [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 255,993 | $ 272,796 | $ 519,845 | $ 546,297 | |
Asset Management [Member] | |||||
Revenue from External Customer [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | [1] | 168,127 | 342,393 | ||
Administrative Service [Member] | |||||
Revenue from External Customer [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | 48,370 | $ 45,601 | 97,393 | $ 92,302 | |
Distribution [Member] | |||||
Revenue from External Customer [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | [2] | 36,923 | 74,980 | ||
Other [Member] | |||||
Revenue from External Customer [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | [3] | $ 2,573 | $ 5,079 | ||
[1] | The performance obligation may include administrative, distribution and other services recorded as a single asset management fee under Topic 606, as it is part of a unitary fee arrangement with a single performance obligation. | ||||
[2] | The performance obligation is satisfied at a point in time and may include CDSC's and upfront commissions. A portion of this revenue relates to a performance obligation that has been satisfied in a prior period. | ||||
[3] | Includes shareholder service fees recorded in Other Service Fees, net—Affiliates on the Consolidated Statements of Income. |
Revenue from Contracts with C41
Revenue from Contracts with Customers Revenue from Contracts with Customers - By Geographic Location (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | ||
Revenue from external customers by geographic areas [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 255,993 | $ 272,796 | $ 519,845 | $ 546,297 | |
Domestic | |||||
Revenue from external customers by geographic areas [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | 248,872 | 504,964 | |||
Foreign [Member] | |||||
Revenue from external customers by geographic areas [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | [1] | $ 7,121 | $ 14,881 | ||
[1] | This represents revenue earned by non-U.S. domiciled subsidiaries. |
Revenue from Contracts with C42
Revenue from Contracts with Customers Revenue from Contracts with Customers - By Product Type (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Revenue from Contracts with Customers - By Product Type [Line Items] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 255,993 | $ 272,796 | $ 519,845 | $ 546,297 |
Federated Funds [Member] | ||||
Revenue from Contracts with Customers - By Product Type [Line Items] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 218,396 | 443,213 | ||
Separate accounts [Member] | ||||
Revenue from Contracts with Customers - By Product Type [Line Items] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 37,597 | $ 76,632 |
Concentration Risk Schedule of
Concentration Risk Schedule of Revenue Concentration (Details) - Product Concentration Risk [Member] | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Equity Assets [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 44.00% | 42.00% |
Money Market Assets [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 39.00% | 41.00% |
Fixed-Income Assets [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 17.00% | 17.00% |
Concentration Risk Revenue Conc
Concentration Risk Revenue Concentration Table (Details) - Product Concentration Risk [Member] | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | ||
FederatedStrategicValueDividendStrategy [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration Risk, Percentage | [1] | 16.00% | 18.00% | 17.00% | 18.00% |
FederatedKaufmannMid-CapGrowthStrategy [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration Risk, Percentage | [2] | 11.00% | 9.00% | 11.00% | 8.00% |
FederatedGovernmentObligationsFund [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration Risk, Percentage | 10.00% | 10.00% | 10.00% | 10.00% | |
[1] | Strategy includes Federated Funds and Separate Accounts. | ||||
[2] | Strategy includes Federated Funds. |
Concentration Risk Narrative (D
Concentration Risk Narrative (Details) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Customer Concentration Risk [Member] | BNYMellonCorporation [Member] | ||||
Concentration Risk, Percentage | 14.00% | 17.00% | 14.00% | 16.00% |
Consolidation Narrative (Detail
Consolidation Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Variable Interest Entities [Line Items] | |||||
Accounts receivable from Federated Funds | $ 23,000 | $ 23,000 | $ 27,400 | ||
Fee Waivers | 88,100 | $ 84,800 | 175,500 | $ 175,300 | |
Investments—Consolidated Investment Companies | 33,603 | 33,603 | 45,411 | ||
Financial Support, Fee Waivers [Member] | |||||
Variable Interest Entities [Line Items] | |||||
Nonconsolidated Legal Entity, Financial Support Amount | 59,600 | 53,800 | 117,500 | 113,600 | |
Financial Support, Capital Contributions [Member] | |||||
Variable Interest Entities [Line Items] | |||||
Nonconsolidated Legal Entity, Financial Support Amount | 0 | $ 0 | 0 | $ 0 | |
Variable Interest Entity, Primary Beneficiary, Aggregated Disclosure [Member] | |||||
Variable Interest Entities [Line Items] | |||||
Investments—Consolidated Investment Companies | 31,700 | 31,700 | 39,700 | ||
Redeemable noncontrolling interest in subsidiaries | 20,300 | 20,300 | 27,700 | ||
Non-Consolidated Variable Interest Entity, Not Primary Beneficiary [Member] | |||||
Variable Interest Entities [Line Items] | |||||
Carrying Value of investment of nonconsolidated VIEs | 1,000 | 1,000 | 900 | ||
Federated's maximum risk of loss in non-consolidated investment companies | 1,000 | 1,000 | 900 | ||
AUM for nonconsolidated Federated Funds | 66,500 | 66,500 | 55,800 | ||
Consolidated Entity Excluding Variable Interest Entities (VIE) [Member] | |||||
Variable Interest Entities [Line Items] | |||||
Investments—Consolidated Investment Companies | 1,900 | 1,900 | 5,700 | ||
Redeemable noncontrolling interest in subsidiaries | $ 700 | $ 700 | $ 2,500 |
Consolidation Consolidated Fede
Consolidation Consolidated Federated Fund VIEs (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Variable Interest Entities [Line Items] | ||
Investments—Consolidated Investment Companies | $ 33,603 | $ 45,411 |
Variable Interest Entity, Consolidated, Carrying Amount, Assets and Liabilities | 11,300 | 12,700 |
Variable Interest Entity, Primary Beneficiary, Aggregated Disclosure [Member] | ||
Variable Interest Entities [Line Items] | ||
Investments—Consolidated Investment Companies | 31,700 | 39,700 |
Less: Liabilities | 600 | 400 |
Less: Redeemable noncontrolling interest in subsidiaries | 20,300 | 27,700 |
Variable Interest Entity, Primary Beneficiary, Aggregated Disclosure [Member] | Cash and Cash Equivalents [Member] | ||
Variable Interest Entities [Line Items] | ||
Consolidated VIE assets | 0 | 100 |
Variable Interest Entity, Primary Beneficiary, Aggregated Disclosure [Member] | Trade Accounts Receivable [Member] | ||
Variable Interest Entities [Line Items] | ||
Consolidated VIE assets | $ 500 | $ 1,000 |
Investments Narrative (Details)
Investments Narrative (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Schedule of Investments [Line Items] | ||
Investments—Affiliates and Other | $ 8,786 | $ 7,863 |
Investments—Consolidated Investment Companies | 33,603 | 45,411 |
Domestic Debt Securities [Member] | ||
Schedule of Investments [Line Items] | ||
Investments—Affiliates and Other | 2,900 | 3,000 |
Investments—Consolidated Investment Companies | 31,300 | 39,200 |
Equity Securities [Member] | ||
Schedule of Investments [Line Items] | ||
Investments—Affiliates and Other | 2,500 | 2,600 |
Equity Securities - Small and Mid-Cap [Member] | ||
Schedule of Investments [Line Items] | ||
Investments—Consolidated Investment Companies | 3,800 | |
Separate accounts [Member] | ||
Schedule of Investments [Line Items] | ||
Investments—Affiliates and Other | 6,200 | 6,300 |
Federated Funds [Member] | ||
Schedule of Investments [Line Items] | ||
Investments—Affiliates and Other | $ 2,600 | $ 1,600 |
Investments (Loss) Gain on Secu
Investments (Loss) Gain on Securities, Net of Investment Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | ||
(Loss) Gain on Securities [Line Items] | |||||
(Loss) Gain on Securities, Net | $ (815) | $ 2,234 | $ (1,997) | $ 4,796 | |
Investments - Consolidated Investment Companies [Member] | |||||
(Loss) Gain on Securities [Line Items] | |||||
Unrealized (Losses) Gains | (653) | 389 | (2,343) | 1,096 | |
Realized Gains | [1] | 501 | 1,075 | 1,325 | 2,074 |
Realized Losses | [1] | (723) | (131) | (898) | (699) |
(Loss) Gain on Securities, Net | (875) | 1,333 | (1,916) | 2,471 | |
Investments - affiliates and other [Member] | |||||
(Loss) Gain on Securities [Line Items] | |||||
Unrealized (Losses) Gains | 9 | 11 | (206) | 271 | |
Net Realized Gains Recognized on Securities Sold | [1] | 51 | 890 | 125 | 2,054 |
(Loss) Gain on Securities, Net | $ 60 | $ 901 | $ (81) | $ 2,325 | |
[1] | Realized gains and losses are computed on a specific-identification basis. |
Fair Value Measurements Narrati
Fair Value Measurements Narrative (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Cash and Cash Equivalents | $ 375,172 | $ 316,264 |
Money Market Funds [Member] | ||
Cash and Cash Equivalents | $ 23,600 | $ 309,100 |
Fair Value Measurements Classes
Fair Value Measurements Classes of Financial Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 | ||
Cash and Cash Equivalents | $ 375,172 | $ 316,264 | ||
Investments - Consolidated Investment Companies - Equity Securities | 2,337 | 6,170 | ||
Investments - Consolidated Investment Companies - Debt Securities | 31,266 | 39,241 | ||
Investments - Affiliates and Other- Equity Securities | 5,848 | 4,866 | ||
Investments - Affiliates and other - Debt Securities | 2,938 | 2,997 | ||
Other assets | [1] | 1,035 | 1,240 | |
Derivative Liability | 28,978 | |||
Other Liabilities | [2] | 1,213 | ||
Level 1 [Member] | ||||
Cash and Cash Equivalents | 375,172 | 205,364 | ||
Investments - Consolidated Investment Companies - Equity Securities | 1,586 | 5,424 | ||
Investments - Consolidated Investment Companies - Debt Securities | 0 | 0 | ||
Investments - Affiliates and Other- Equity Securities | 5,563 | 4,564 | ||
Investments - Affiliates and other - Debt Securities | 0 | 0 | ||
Other assets | [1] | 583 | 123 | |
Other Liabilities | [2] | 12 | ||
Level 2 [Member] | ||||
Cash and Cash Equivalents | 0 | 0 | ||
Investments - Consolidated Investment Companies - Equity Securities | 751 | 746 | ||
Investments - Consolidated Investment Companies - Debt Securities | 31,266 | 39,241 | ||
Investments - Affiliates and Other- Equity Securities | 0 | 0 | ||
Investments - Affiliates and other - Debt Securities | 2,938 | 2,997 | ||
Other assets | [1] | 0 | 357 | |
Other Liabilities | [2] | 273 | ||
Level 3 [Member] | ||||
Cash and Cash Equivalents | 0 | 0 | ||
Investments - Consolidated Investment Companies - Equity Securities | 0 | 0 | ||
Investments - Consolidated Investment Companies - Debt Securities | 0 | 0 | ||
Investments - Affiliates and Other- Equity Securities | 0 | 0 | ||
Investments - Affiliates and other - Debt Securities | 0 | 0 | ||
Other assets | [1] | 452 | 760 | |
Other Liabilities | [2] | 928 | ||
Fair Value Measured at Net Asset Value Per Share [Member] | ||||
NAV Practical Expedient | 285 | 111,202 | ||
Cash and Cash Equivalents [Member] | Fair Value Measured at Net Asset Value Per Share [Member] | ||||
NAV Practical Expedient | 0 | 110,900 | ||
Equity Securities [Member] | Fair Value Measured at Net Asset Value Per Share [Member] | ||||
NAV Practical Expedient | 285 | 302 | ||
Fair Value, Measurements, Recurring [Member] | ||||
Total Financial Assets | 418,596 | 370,778 | ||
Total Financial Liabilities | 30,191 | 1,203 | [2] | |
Fair Value, Measurements, Recurring [Member] | Level 1 [Member] | ||||
Total Financial Assets | 382,904 | 215,475 | ||
Total Financial Liabilities | 12 | 0 | [2] | |
Fair Value, Measurements, Recurring [Member] | Level 2 [Member] | ||||
Total Financial Assets | 34,955 | 43,341 | ||
Total Financial Liabilities | 29,251 | 0 | [2] | |
Fair Value, Measurements, Recurring [Member] | Level 3 [Member] | ||||
Total Financial Assets | 452 | 760 | ||
Total Financial Liabilities | $ 928 | $ 1,203 | [2] | |
[1] | Amounts include restricted cash, structured trade finance loans held by Federated as well as futures contracts and/or foreign currency forward contracts held within certain consolidated Federated Funds. | |||
[2] | Amounts include acquisition-related future contingent consideration liabilities as well as certain liabilities attributable to structured trade finance loans held by Federated and may include foreign currency forward contracts and/or futures contracts held within certain consolidated Federated Funds. |
Derivatives Narrative (Details)
Derivatives Narrative (Details) $ in Thousands, £ in Millions | Aug. 01, 2018 | Jun. 27, 2018GBP (£) | Apr. 13, 2018GBP (£) | Jun. 30, 2018USD ($) |
Derivative [Line Items] | ||||
Derivative, Inception Date | Jun. 27, 2018 | Apr. 13, 2018 | ||
Derivative, Notional Amount | £ | £ 250 | £ 250 | ||
Derivative, Forward Exchange Rate | 1.31601 | 1.43192 | ||
Derivative, Underlying | 1.314 | 1.42522 | ||
Derivative, Basis Spread on Variable Rate | 0.201% | 0.67% | ||
Derivative Liability | $ 29,000 | |||
Derivative, Loss on Derivative | $ 29,000 | |||
Scenario, Forecast [Member] | ||||
Derivative [Line Items] | ||||
Derivative, Maturity Date | Aug. 1, 2018 |
Debt Narrative (Details)
Debt Narrative (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Jun. 30, 2018 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 05, 2017 | Jun. 24, 2014 |
Line of credit facility, maximum borrowing capacity | $ 375,000 | $ 200,000 | ||||
Borrowings under Term Loan | 178,500 | |||||
Line of Credit Facility Accordion Feature | 200,000 | |||||
Line of credit facility, outstanding borrowings | 0 | |||||
Proceeds from New Borrowings | $ 18,000 | $ 18,000 | $ 0 | |||
Line of Credit Facility, Commitment Fee Percentage | 0.125% | |||||
Line of credit facility, current borrowing capacity | $ 197,000 | $ 197,000 | $ 197,000 | |||
SwingLine [Member] | ||||||
Line of credit facility, maximum borrowing capacity | $ 25,000 |
Debt Debt Table (Details)
Debt Debt Table (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 | |
Line of Credit Facility [Line Items] | |||
Long-term Line of Credit, Noncurrent | $ 178,000 | $ 170,000 | |
Revolving Credit Facility [Member] | |||
Line of Credit Facility [Line Items] | |||
Line of Credit Facility, Interest Rate at Period End | 3.107% | 2.486% | |
Long-term Line of Credit, Noncurrent | $ 160,000 | $ 170,000 | |
SwingLine [Member] | |||
Line of Credit Facility [Line Items] | |||
Long-term Line of Credit, Noncurrent | $ 18,000 | $ 0 | |
Debt, Weighted Average Interest Rate | [1] | 3.216% | |
[1] | Represents the weighted-average interest rate for the period in which a balance is outstanding. |
Share-Based Compensation Plans
Share-Based Compensation Plans (Details) - shares | 6 Months Ended | 12 Months Ended |
Jun. 30, 2018 | Dec. 31, 2017 | |
Restricted Stock Granted in Period | 486,769 | 946,570 |
Class B Common Stock Bonus [Member] | ||
Restricted Stock Granted in Period | 513,570 | |
Restricted stock requisite service period | 3 years | |
Class B Common Stock Key Employees [Member] | ||
Restricted stock requisite service period | 10 years | 10 years |
Equity (Details)
Equity (Details) - USD ($) $ in Thousands, shares in Millions | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Oct. 27, 2016 | |
Purchase of treasury stock | $ 21,040 | $ 28,252 | |
Treasury Stock [Member] | |||
Purchase of treasury stock | $ 21,040 | $ 28,252 | |
Class B [Member] | |||
Number of shares authorized under share repurchase program | 4 | ||
Repurchased shares | 0.8 | ||
Remaining number of shares authorized to be repurchased | 1.4 |
Earnings Per Share Attributab57
Earnings Per Share Attributable to Federated Investors, Inc. Shareholders Earnings Per Share Attributable to Federated Investors, Inc. Shareholders Computation of Basic and Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | ||
Earnings Per Share [Abstract] | |||||
Net Income Attributable to Federated Investors, Inc. | $ 38,822 | $ 53,451 | $ 99,153 | $ 103,092 | |
Less: Total Income Available to Participating Unvested Restricted Shareholders, Basic | [1] | (1,529) | (2,159) | (3,907) | (4,122) |
Less: Total Income Available to Participating Unvested Restricted Shareholders, Diluted | [1] | (1,529) | (2,159) | (3,907) | (4,122) |
Total Net Income Attributable to Federated Common Stock, Basic | [2] | 37,293 | 51,292 | 95,246 | 98,970 |
Total Net Income Attributable to Federated Common Stock, Diluted | [2] | $ 37,293 | $ 51,292 | $ 95,246 | $ 98,970 |
Weighted Average Number of Shares Outstanding, Diluted [Abstract] | |||||
Basic Weighted-Average Federated Common Stock | [2] | 97,193 | 97,581 | 97,191 | 97,722 |
Dilutive Potential Shares from Stock Options | 1 | 1 | 1 | 1 | |
Diluted Weighted-Average Federated Common Stock | [2] | 97,194 | 97,582 | 97,192 | 97,723 |
Net Income Attributable to Federated Common Stock - Basic and Diluted | [2] | $ 0.38 | $ 0.53 | $ 0.98 | $ 1.01 |
[1] | Income available to participating unvested restricted shareholders includes dividends paid on unvested restricted shares and their proportionate share of undistributed earnings. | ||||
[2] | Federated Common Stock excludes unvested restricted shares which are deemed participating securities in accordance with the two-class method of computing earnings per share. |
Commitments and Contingencies (
Commitments and Contingencies (Details) $ in Millions | Jun. 30, 2018USD ($) |
Employee Incentive Compensation Maximum Bonus Payable Over Remaining Terms | $ 31 |
Employment-related Commitments [Member] | |
Unrecorded Unconditional Purchase Obligation | $ 9 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended |
Jun. 30, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | ||
Federal Statutory Income Tax Rate, Percent | 21.00% | 35.00% |
Income Tax Expense (Benefit), Continuing Operations, Adjustment of Deferred Tax (Asset) Liability | $ 70.4 |
Subsequent Events (Details)
Subsequent Events (Details) | Jul. 26, 2018$ / shares |
Subsequent Event [Member] | |
Dividend declared | $ 0.27 |