Hennessy Advisors (HNNA) 10-Q 11 Feb 19 2019 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Dec. 31, 2018	Feb. 06, 2019
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Dec. 31, 2018
Document Fiscal Year Focus	2,019
Document Fiscal Period Focus	Q1
Trading Symbol	HNNA
Entity Registrant Name	HENNESSY ADVISORS INC
Entity Central Index Key	1,145,255
Current Fiscal Year End Date	--09-30
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		7,917,966
Entity Emerging Growth Company	false
Entity Small Business	true

Balance Sheets

Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2018	Sep. 30, 2018
Current assets:
Cash and cash equivalents	$ 23,446	$ 25,395
Investments in marketable securities, at fair value	9	9
Investment fee income receivable	3,615	4,259
Prepaid expenses	429	668
Other accounts receivable	446	413
Total current assets	27,945	30,744
Property and equipment, net of accumulated depreciation of $1,209 and $1,154, respectively	384	382
Management contracts	79,903	78,163
Other assets	192	191
Total assets	108,424	109,480
Current liabilities:
Accrued liabilities and accounts payable	3,066	7,083
Income taxes payable	1,420	558
Deferred rent	154	166
Current portion of long-term debt, net of debt issuance costs	4,228	4,228
Total current liabilities	8,868	12,035
Long-term debt, net of debt issuance costs and current portion	16,442	17,500
Deferred income tax liability, net	9,389	8,965
Total liabilities	34,699	38,500
Commitments and Contingencies (Note 8)
Stockholders' equity:
Common stock, no par value, 22,500,000 shares authorized: 7,917,526 shares issued and outstanding at December 31, 2018, and 7,897,145 at September 30, 2018	17,337	16,783
Retained earnings	56,388	54,197
Total stockholders' equity	73,725	70,980
Total liabilities and stockholders' equity	$ 108,424	$ 109,480

Balance Sheets (Parenthetical)

Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Dec. 31, 2018	Sep. 30, 2018
Statement of Financial Position [Abstract]
Property and equipment, accumulated depreciation	$ 1,209	$ 1,154
Common stock, no par value	$ 0	$ 0
Common stock, shares authorized	22,500,000	22,500,000
Common stock, shares issued	7,917,526	7,897,145
Common stock, shares outstanding	7,917,526	7,897,145

Statements of Income (Unaudited

Statements of Income (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Revenue:
Total revenue	$ 11,644	$ 13,813
Operating expenses:
Compensation and benefits	2,900	3,166
General and administrative	1,517	1,515
Mutual fund distribution	123	120
Sub-advisory fees	2,444	2,532
Depreciation	55	46
Total operating expenses	7,039	7,379
Net operating income	4,605	6,434
Interest expense	310	300
Other income	(78)	(13)
Income before income tax expense (benefit)	4,373	6,147
Income tax expense (benefit)	1,306	(2,040)
Net income	$ 3,067	$ 8,187
Earnings per share:
Basic	$ 0.39	$ 1.05
Diluted	$ 0.39	$ 1.04
Weighted average shares outstanding:
Basic	7,913,894	7,800,409
Diluted	7,916,870	7,842,707
Cash dividends declared per share:	$ 0.11	$ 0.08
Investment Advice [Member]
Revenue:
Total revenue	$ 10,738	$ 12,672
Shareholder Service [Member]
Revenue:
Total revenue	$ 906	$ 1,141

Statement of Changes in Stockho

Statement of Changes in Stockholders' Equity (Unaudited) - USD ($) $ in Thousands	Total	Common Stock [Member]	Retained Earnings [Member]
Beginning balance at Sep. 30, 2017	$ 51,530	$ 14,943	$ 36,587
Beginning balance, Shares at Sep. 30, 2017		7,776,563
Net income	8,187		8,187
Dividends declared	(585)		(585)
Employee and director restricted stock vested	0	$ 0	0
Employee and director restricted stock vested, Shares		33,750
Repurchase of vested employee restricted stock for tax withholding	(117)	$ (65)	(52)
Repurchase of vested employee restricted stock for tax withholding, Shares		(7,329)
Shares issued for auto-investments pursuant to the 2015 and 2018 Dividend Reinvestment and Stock Purchase Plan, Shares		16
Shares issued for dividend reinvestment pursuant to the 2015 and 2018 Dividend Reinvestment and Stock Purchase Plan	9	$ 9
Shares issued for dividend reinvestment pursuant to the 2015 and 2018 Dividend Reinvestment and Stock Purchase Plan, Shares		530
Stock-based compensation	598	$ 598
Ending balance at Dec. 31, 2017	59,622	$ 15,485	44,137
Ending balance, shares at Dec. 31, 2017		7,803,530
Beginning balance at Sep. 30, 2018	70,980	$ 16,783	54,197
Beginning balance, Shares at Sep. 30, 2018		7,897,145
Net income	3,067		3,067
Dividends declared	(871)		(871)
Employee and director restricted stock vested	0	$ 0	0
Employee and director restricted stock vested, Shares		21,563
Repurchase of vested employee restricted stock for tax withholding	(36)	$ (31)	(5)
Repurchase of vested employee restricted stock for tax withholding, Shares		(2,685)
Shares issued for auto-investments pursuant to the 2015 and 2018 Dividend Reinvestment and Stock Purchase Plan	4	$ 4
Shares issued for auto-investments pursuant to the 2015 and 2018 Dividend Reinvestment and Stock Purchase Plan, Shares		296
Shares issued for dividend reinvestment pursuant to the 2015 and 2018 Dividend Reinvestment and Stock Purchase Plan	13	$ 13
Shares issued for dividend reinvestment pursuant to the 2015 and 2018 Dividend Reinvestment and Stock Purchase Plan, Shares		1,207
Stock-based compensation	568	$ 568
Ending balance at Dec. 31, 2018	$ 73,725	$ 17,337	$ 56,388
Ending balance, shares at Dec. 31, 2018		7,917,526

Statements of Cash Flows (Unaud

Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Cash flows from operating activities:
Net income	$ 3,067	$ 8,187
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation	55	46
Deferred income taxes	424	(3,810)
Stock-based compensation	568	598
Unrealized gains on marketable securities		(1)
Interest expense associated with debt issuance costs	36	37
Change in operating assets and liabilities:
Investment fee income receivable	644	(442)
Prepaid expenses	239	1,252
Other accounts receivable	(33)	84
Other assets	(1)	(7)
Accrued liabilities and accounts payable	(4,017)	(4,221)
Income taxes payable	862	684
Deferred rent	(12)	(7)
Net cash provided by operating activities	1,832	2,400
Cash flows from investing activities:
Purchases of property and equipment	(57)	(57)
Payments related to management contracts	(1,740)	(1,058)
Net cash used in investing activities	(1,797)	(1,115)
Cash flows from financing activities:
Principal payments on bank loan	(1,094)	(1,094)
Restricted stock units repurchased for employee tax withholding	(36)	(117)
Proceeds from shares issued pursuant to the 2015 and 2018 Dividend Reinvestment and Stock Repurchase Plans	17	9
Dividend payments	(871)	(585)
Net cash used in financing activities	(1,984)	(1,787)
Net decrease in cash and cash equivalents	(1,949)	(502)
Cash and cash equivalents at the beginning of the period	25,395	15,700
Cash and cash equivalents at the end of the period	23,446	15,198
Cash paid for:
Income taxes	22	19
Interest	$ 267	$ 270

Basis of Financial Statement Pr

Basis of Financial Statement Presentation	3 Months Ended
	Dec. 31, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of Financial Statement Presentation	(1) Basis of Financial Statement Presentation The accompanying condensed balance sheet as of September 30, 2018, which has been derived from audited financial statements, and the unaudited interim condensed financial statements as of and for the three months ended December 31, 2018, have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission and include the accounts of Hennessy Advisors, Inc. (the “Company,” “we,” “us,” or “our”). Certain information and footnote disclosures in these unaudited interim condensed financial statements, normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States, have been condensed or omitted pursuant to rules and regulations of the Securities and Exchange Commission for Quarterly Reports on Form 10-Q. Form 10-K The preparation of financial statements requires management to make estimates and assumptions. Making estimates requires management to exercise significant judgment. Accordingly, the actual results could differ substantially from those estimates. The Company’s operating activities consist primarily of providing investment advisory services to 16 open-end The Company’s operating revenues consist of contractual investment advisory and shareholder service fees paid to it by the Hennessy Funds. The Company earns investment advisory fees from each Hennessy Fund by, among other things: • acting as portfolio manager for the fund or overseeing the sub-advisor • performing a daily reconciliation of portfolio positions and cash for the fund; • monitoring the fund’s compliance with its investment objectives and restrictions and federal securities laws; • performing activities such as maintaining a compliance program, conducting ongoing reviews of the compliance programs of the fund’s service providers (including its sub-advisor, on-site sub-advisor, • if applicable, overseeing the selection and continued employment of the fund’s sub-advisor, sub-advisor’s • overseeing service providers that provide accounting, administration, distribution, transfer agency, custodial, sales, marketing, public relations, audit, information technology, and legal services to the fund; • maintaining in-house • preparing or directing the preparation of all regulatory filings for the fund, including writing and annually updating the fund’s prospectus and related documents; • preparing or reviewing a written summary of the fund’s performance for the most recent 12-month • monitoring and overseeing the accessibility of the fund on third -party • paying the incentive compensation of the fund’s compliance officers and employing other staff such as legal, marketing, national accounts, distribution, sales, administrative, and trading oversight personnel, as well as management executives; • providing a quarterly compliance certification to Hennessy Funds Trust; and • preparing or reviewing materials for the Funds’ Board of Trustees, presenting or leading discussions to or with the Funds’ Board of Trustees, preparing or reviewing meeting minutes, and arranging for training and education of the Funds’ Board of Trustees. The Company earns shareholder service fees from Investor Class shares of the Hennessy Funds by, among other things, maintaining an “800” number that the current investors in the Hennessy Funds may call to ask questions about the Hennessy Funds or their accounts, or to get help with processing exchange and redemption requests or changing account options. These fee revenues are earned and calculated daily by the Hennessy Funds’ accountants at U.S. Bank Global Fund Services and are subsequently reviewed by management. The fees are computed and billed monthly, at which time they are recognized in accordance with Accounting Standards Codification 606 — Revenue Recognition. The Company waives fees with respect to the Hennessy BP Midstream Fund and the Hennessy Technology Fund to comply with contractual expense ratio limitations. The fee waivers are calculated daily by the Hennessy Funds’ accountants at U.S. Bank Global Fund Services, reviewed by management, and then charged to expense monthly by the Company as offsets to revenue. The waived fees are deducted from investment advisory fee income and reduce the aggregate amount of advisory fees received by the Company in the subsequent month. To date, the Company has only waived fees based on contractual obligations, but the Company has the ability to waive fees at its discretion. Any decision to waive fees voluntarily would apply only on a going-forward The Company’s contractual agreements for investment advisory and shareholder services provide persuasive evidence that an arrangement exists with fixed and determinable fees, and the services are rendered daily. The collectability is deemed probable because the fees are received from the Hennessy Funds in the month subsequent to the month in which the services are provided.

Management Contracts Purchased

Management Contracts Purchased	3 Months Ended
	Dec. 31, 2018
Text Block [Abstract]
Management Contracts Purchased	(2) Management Contracts Purchased Throughout its history, the Company has completed 10 purchases of assets related to the management of 30 different mutual funds, some of which were reorganized into already existing Hennessy Funds. In accordance with Financial Accounting Standards Board (“FASB”) guidance, the Company periodically reviews the carrying value of its purchased management contracts to determine if any impairment has occurred. The fair value of management contracts is based on management estimates and assumptions, including third-party Under Accounting Standards Codification 350 — Intangibles—Goodwill and Other, intangible assets that have indefinite useful lives are not amortized but are tested at least annually for impairment. The Company reviews the life of the management contracts each reporting period to determine if they continue to have an indefinite useful life. The Company completed its most recent asset purchase on October 26, 2018, when it purchased the assets related to the management of the BP Capital TwinLine Energy Fund and the BP Capital TwinLine MLP Fund (together, the “BP Funds”). This asset purchase added nearly $200 million to the Company’s assets under management. The purchase was consummated in accordance with the terms and conditions of the Transaction Agreement, dated as of July 10, 2018, between the Company and BP Capital Fund Advisors, LLC (“BP Capital”). Upon completion of the transaction, the assets related to the management of the BP Funds were reorganized into two new series of Hennessy Funds Trust called the Hennessy BP Energy Fund and the Hennessy BP Midstream Fund, respectively. In connection with the transaction, BP Capital became the sub-advisor The initial portion of the purchase price of $1.6 million was funded with available cash and was based on the aggregate net asset value of the BP Funds measured as of the close of business on October 25, 2018, the trading day immediately preceding the closing date of the transaction, plus $100,000. In accordance with the Transaction Agreement, the Company will make a subsequent payment on October 28, 2019, the business day immediately following the one-year one-year

Investment Advisory Agreements

Investment Advisory Agreements	3 Months Ended
	Dec. 31, 2018
Text Block [Abstract]
Investment Advisory Agreements	(3) Investment Advisory Agreements The Company has investment advisory agreements with Hennessy Funds Trust under which it provides investment advisory services to all classes of the 16 Hennessy Funds. The investment advisory agreements must be renewed annually (except in limited circumstances) by (a) the Funds’ Board of Trustees or the vote of a majority of the outstanding shares of the applicable Hennessy Fund and (b) the vote of a majority of the trustees of Hennessy Funds Trust who are not interested persons of the Hennessy Funds. If the investment advisory agreements are not renewed annually as described above, they terminate automatically. There are two additional circumstances in which the investment advisory agreements terminate. First, the investment advisory agreements automatically terminate if the Company assigns them to another advisor (assignment includes “indirect assignment,” which is the transfer of the Company’s common stock in sufficient quantities deemed to constitute a controlling block). Second, each investment advisory agreement may be terminated prior to its expiration upon 60 days’ notice by either the Company or the applicable Hennessy Fund. As provided in the investment advisory agreements with the 16 Hennessy Funds, the Company receives investment advisory fees monthly based on a percentage of each fund’s average daily net assets. The Company has entered into sub-advisory sub-advisory sub-advisor sub-advisors sub-advisory In exchange for the sub-advisory sub-advisory sub-advisors Sub-advisory sub-advised

Bank Loan

Bank Loan	3 Months Ended
	Dec. 31, 2018
Debt Disclosure [Abstract]
Bank Loan	(4) Bank Loan The Company has an outstanding bank loan with U.S. Bank National Association (“U.S. Bank”), as administrative agent and as a lender, and California Bank & Trust, as syndication agent and as a lender. On September 17, 2015, in connection with its self-tender The term loan agreement requires 60 monthly payments in the amount of $364,583 plus interest calculated based on one of the following, at the Company’s option: (1) the sum of non-cash plus (2) the sum of plus one-month The Company currently uses a one-month one-month All borrowings under the term loan agreement are secured by substantially all of the Company’s assets. The final installment of the then-outstanding The term loan agreement includes certain reporting requirements and loan covenants requiring the maintenance of certain financial ratios. The Company was in compliance for the periods ended December 31, 2018 and 2017. In connection with securing the financings discussed above, the Company incurred loan costs in the amount of $0.41 million. These costs were reclassified to offset debt liability per Accounting Standards Update (“ASU”) 2015-03 In accordance with ASU 2015-03,

Income Taxes

Income Taxes	3 Months Ended
	Dec. 31, 2018
Income Tax Disclosure [Abstract]
Income Taxes	(5) Income Taxes On December 22, 2017, during the Company’s first fiscal quarter of 2018, the Tax Cuts and Jobs Act of 2017 (the “2017 Tax Act”) was enacted into law. Among other changes to various corporate income tax provisions within the existing Internal Revenue Code, the 2017 Tax Act reduced the federal corporate income tax rate from 35% to 21%, effective January 1, 2018. Also on December 22, 2017, the Securities and Exchange Commission issued Staff Accounting Bulletin (“SAB”) No. 118 to provide guidance to companies whose accounting for the income tax effects of the 2017 Tax Act would be incomplete by the time financial statements were issued for the reporting period in which the 2017 Tax Act was enacted. In such a circumstance, SAB No. 118 directed companies to include a reasonable estimate of any required adjustment in “net earnings from continuing operations” as an adjustment to income tax expense in the reporting period during which the reasonable estimate was determined. In the Company’s first fiscal quarter of 2018, based on available information, it reasonably estimated the impact of the reduced corporate tax rate and remeasured its deferred tax liability. As a result, the Company recorded a one-time, non-cash The Company’s effective income tax rates for the three months ended December 31, 2018 and 2017, were 29.9% and -33.2%, one-time one-time The Company is subject to income tax in the U.S. federal jurisdiction and multiple state jurisdictions. Following is a list of jurisdictions that the Company has identified as its major tax jurisdictions with the tax years that remain open and subject to examination by the appropriate governmental agencies marked: Tax Jurisdiction 2014 2015 2016 2017 2018 United States X X X X California X X X X X Connecticut X X District of Columbia X X X Florida X X Georgia X X Illinois X X X X Louisiana X Maryland X X X Massachusetts X X X X Michigan X X X Minnesota X X X New Hampshire X X X X New York X X X North Carolina X X X X Oregon X Texas X X X Wisconsin X X For state tax jurisdictions with unfiled tax returns, the statute of limitations will remain open indefinitely.

Earnings per Share and Dividend

Earnings per Share and Dividends per Share	3 Months Ended
	Dec. 31, 2018
Text Block [Abstract]
Earnings per Share and Dividends per Share	(6) Earnings per Share and Dividends per Share Basic earnings per share is determined by dividing net earnings by the weighted average number of shares of common stock outstanding, while diluted earnings per share is determined by dividing net earnings by the weighted average number of shares of common stock outstanding adjusted for the dilutive effect of common stock equivalents, which consist of restricted stock units (“RSUs”). For the three months ended December 31, 2018, the Company excluded 335,350 common stock equivalents, consisting of non-vested The Company paid a quarterly cash dividend of $0.11 per share on December 5, 2018, to shareholders of record as of November 13, 2018.

Equity

Equity	3 Months Ended
	Dec. 31, 2018
Federal Home Loan Banks [Abstract]
Equity	(7) Equity Amended and Restated 2013 Omnibus Incentive Plan The Company has adopted, and the Company’s shareholders have approved, the Amended and Restated 2013 Omnibus Incentive Plan (the “Omnibus Plan”). Under the Omnibus Plan, participants may be granted RSUs, each of which represents an unfunded, unsecured right to receive a share of the Company’s common stock on the date specified in the recipient’s award. The Company issues new shares of its common stock when it is required to deliver shares to an RSU recipient. The RSUs granted under the Omnibus Plan vest over four years at a rate of 25% per year. The Company recognizes stock-based straight-line RSU activity for the three months ended December 31, 2018, was as follows: RSU Activity Three Months Ended December 31, 2018 Number Weighted Avg. per Share at Each Date Non-vested Balance at September 30, 2018 324,771 $ 15.43 Granted — — Vested (1) (35,221 ) 16.12 Forfeited — — Non-vested Balance at December 31, 2018 289,550 $ 15.34 (1) The number of vested RSUs includes partially vested shares. Shares of common stock have not been issued for the partially vested shares, but the related compensation expense has been recognized. There were 18,878 net shares of common stock issued for vested and issued RSUs during the three months ended December 31, 2018. RSU Compensation Three Months Ended December 31, 2018 (In thousands) Total expected compensation expense related to RSUs $ 13,955 Recognized compensation expense related to RSUs at reporting date (9,512 ) Unrecognized compensation expense related to RSUs at reporting date $ 4,443 As of December 31, 2018, there was $4.4 million of total RSU compensation expense related to non-vested Dividend Reinvestment and Stock Purchase Plan In January 2018, the Company adopted an updated Dividend Reinvestment and Stock Purchase Plan (the “DRSPP”), replacing the previous Dividend Reinvestment and Stock Purchase Plan established in March 2015, to provide shareholders and new investors with a convenient and economical means of purchasing shares of the Company’s common stock and reinvesting cash dividends paid on the Company’s common stock. Under the DRSPP and its predecessor, the Company issued 1,503 and 546 shares of common stock during the three months ended December 31, 2018 and 2017, respectively. The maximum number of shares that may be issued under the current DRSPP is 1,550,000, of which 1,545,460 shares remain available for issuance. Stock Buyback Program In August 2010, the Company adopted a stock buyback program. The program provides that the Company may repurchase up to 1,500,000 shares of its common stock and has no expiration date. Share repurchases may be made in the open market, in privately negotiated transactions, or otherwise. The Company did not repurchase any shares pursuant to the stock buyback program during the three months ended December 31, 2018 and 2017. 1,363,211 shares remain available for repurchase under the stock buyback program.

Commitments and Contingencies

Commitments and Contingencies	3 Months Ended
	Dec. 31, 2018
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	(8) Commitments and Contingencies The Company leases office space under non-cancelable Total rent expense for the three months ended December 31, 2018, was $0.1 million. As of December 31, 2018, there were no material changes in the leasing arrangements that would have a significant effect on the future minimum lease payments reported in the Company’s Annual Report on Form 10-K

Fair Value Measurements

Fair Value Measurements	3 Months Ended
	Dec. 31, 2018
Fair Value Disclosures [Abstract]
Fair Value Measurements	(9) Fair Value Measurements The Company applies Accounting Standards Codification 820 — Fair Value Measurement for all financial assets and liabilities, which establishes a framework for measuring fair value and expands disclosures about fair value measurements. The standard defines fair value as “the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.” It also establishes a fair value hierarchy consisting of the following three levels that prioritize the inputs to the valuation techniques used to measure fair value: • Level 1 – Unadjusted, quoted prices in active markets for identical assets or liabilities that an entity has the ability to access at the measurement date; • Level 2 – Other significant observable inputs (including, but not limited to, quoted prices in active markets for similar assets or liabilities, quoted prices in markets that are not active for identical or similar assets or liabilities, and model-derived • Level 3 – Significant unobservable inputs (including the entity’s own assumptions about what market participants would use to price the asset or liability based on the best available information) when observable inputs are not available. Based on the definitions, the following table represents the Company’s assets categorized in the Level 1 to 3 hierarchies as of December 31, 2018, and September 30, 2018: Fair Value Measurements at December 31, 2018 Level 1 Level 2 Level 3 Total (In thousands) Money market fund deposits $ 19,557 $ — $ — $ 19,557 Mutual fund investments 9 — — 9 Total $ 19,566 $ — $ — $ 19,566 Amounts included in: Cash and cash equivalents $ 19,557 $ — $ — $ 19,557 Investments in marketable securities 9 — — 9 Total $ 19,566 $ — $ — $ 19,566 Fair Value Measurements at September 30, 2018 Level 1 Level 2 Level 3 Total (In thousands) Money market fund deposits $22,978 $— $— $22,978 Mutual fund investments 9 — — 9 Total $22,987 $— $— $22,987 Amounts included in: Cash and cash equivalents $22,978 $— $— $22,978 Investments in marketable securities 9 — — 9 Total $22,987 $— $— $22,987 There were no transfers between levels during the three months ended December 31, 2018, or the year ended September 30, 2018.

New Accounting Standards

New Accounting Standards	3 Months Ended
	Dec. 31, 2018
Accounting Changes and Error Corrections [Abstract]
New Accounting Standards	(10) New Accounting Standards The Company has reviewed the new accounting standards issued between November 28, 2018, the filing date of its most recent Form 10-K, Form 10-Q,

Subsequent Events

Subsequent Events	3 Months Ended
	Dec. 31, 2018
Subsequent Events [Abstract]
Subsequent Events	(11) Subsequent Events The Company has evaluated subsequent events through the date these financial statements were issued and has concluded that no material subsequent events occurred during this period that would require recognition or disclosure.

Basis of Financial Statement _2

Basis of Financial Statement Presentation (Policies)	3 Months Ended
	Dec. 31, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Revenue Recognition	The accompanying condensed balance sheet as of September 30, 2018, which has been derived from audited financial statements, and the unaudited interim condensed financial statements as of and for the three months ended December 31, 2018, have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission and include the accounts of Hennessy Advisors, Inc. (the “Company,” “we,” “us,” or “our”). Certain information and footnote disclosures in these unaudited interim condensed financial statements, normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States, have been condensed or omitted pursuant to rules and regulations of the Securities and Exchange Commission for Quarterly Reports on Form 10-Q. Form 10-K The preparation of financial statements requires management to make estimates and assumptions. Making estimates requires management to exercise significant judgment. Accordingly, the actual results could differ substantially from those estimates. The Company’s operating activities consist primarily of providing investment advisory services to 16 open-end The Company’s operating revenues consist of contractual investment advisory and shareholder service fees paid to it by the Hennessy Funds. The Company earns investment advisory fees from each Hennessy Fund by, among other things: • acting as portfolio manager for the fund or overseeing the sub-advisor • performing a daily reconciliation of portfolio positions and cash for the fund; • monitoring the fund’s compliance with its investment objectives and restrictions and federal securities laws; • performing activities such as maintaining a compliance program, conducting ongoing reviews of the compliance programs of the fund’s service providers (including its sub-advisor, on-site sub-advisor, • if applicable, overseeing the selection and continued employment of the fund’s sub-advisor, sub-advisor’s • overseeing service providers that provide accounting, administration, distribution, transfer agency, custodial, sales, marketing, public relations, audit, information technology, and legal services to the fund; • maintaining in-house • preparing or directing the preparation of all regulatory filings for the fund, including writing and annually updating the fund’s prospectus and related documents; • preparing or reviewing a written summary of the fund’s performance for the most recent 12-month • monitoring and overseeing the accessibility of the fund on third -party • paying the incentive compensation of the fund’s compliance officers and employing other staff such as legal, marketing, national accounts, distribution, sales, administrative, and trading oversight personnel, as well as management executives; • providing a quarterly compliance certification to Hennessy Funds Trust; and • preparing or reviewing materials for the Funds’ Board of Trustees, presenting or leading discussions to or with the Funds’ Board of Trustees, preparing or reviewing meeting minutes, and arranging for training and education of the Funds’ Board of Trustees. The Company earns shareholder service fees from Investor Class shares of the Hennessy Funds by, among other things, maintaining an “800” number that the current investors in the Hennessy Funds may call to ask questions about the Hennessy Funds or their accounts, or to get help with processing exchange and redemption requests or changing account options. These fee revenues are earned and calculated daily by the Hennessy Funds’ accountants at U.S. Bank Global Fund Services and are subsequently reviewed by management. The fees are computed and billed monthly, at which time they are recognized in accordance with Accounting Standards Codification 606 — Revenue Recognition. The Company waives fees with respect to the Hennessy BP Midstream Fund and the Hennessy Technology Fund to comply with contractual expense ratio limitations. The fee waivers are calculated daily by the Hennessy Funds’ accountants at U.S. Bank Global Fund Services, reviewed by management, and then charged to expense monthly by the Company as offsets to revenue. The waived fees are deducted from investment advisory fee income and reduce the aggregate amount of advisory fees received by the Company in the subsequent month. To date, the Company has only waived fees based on contractual obligations, but the Company has the ability to waive fees at its discretion. Any decision to waive fees voluntarily would apply only on a going-forward The Company’s contractual agreements for investment advisory and shareholder services provide persuasive evidence that an arrangement exists with fixed and determinable fees, and the services are rendered daily. The collectability is deemed probable because the fees are received from the Hennessy Funds in the month subsequent to the month in which the services are provided.

Income Taxes (Tables)

Income Taxes (Tables)	3 Months Ended
	Dec. 31, 2018
Income Tax Disclosure [Abstract]
Summary of Federal and State Jurisdiction Tax	The Company is subject to income tax in the U.S. federal jurisdiction and multiple state jurisdictions. Following is a list of jurisdictions that the Company has identified as its major tax jurisdictions with the tax years that remain open and subject to examination by the appropriate governmental agencies marked: Tax Jurisdiction 2014 2015 2016 2017 2018 United States X X X X California X X X X X Connecticut X X District of Columbia X X X Florida X X Georgia X X Illinois X X X X Louisiana X Maryland X X X Massachusetts X X X X Michigan X X X Minnesota X X X New Hampshire X X X X New York X X X North Carolina X X X X Oregon X Texas X X X Wisconsin X X

Equity (Tables)

Equity (Tables)	3 Months Ended
	Dec. 31, 2018
Federal Home Loan Banks [Abstract]
Schedule of Non-Vested Restricted Stock Units Activity	RSU activity for the three months ended December 31, 2018, was as follows: RSU Activity Three Months Ended December 31, 2018 Number Weighted Avg. per Share at Each Date Non-vested Balance at September 30, 2018 324,771 $ 15.43 Granted — — Vested (1) (35,221 ) 16.12 Forfeited — — Non-vested Balance at December 31, 2018 289,550 $ 15.34 (1) The number of vested RSUs includes partially vested shares. Shares of common stock have not been issued for the partially vested shares, but the related compensation expense has been recognized. There were 18,878 net shares of common stock issued for vested and issued RSUs during the three months ended December 31, 2018.
Schedule of Non-Vested Restricted Stock Units Compensation	RSU Compensation Three Months Ended December 31, 2018 (In thousands) Total expected compensation expense related to RSUs $ 13,955 Recognized compensation expense related to RSUs at reporting date (9,512 ) Unrecognized compensation expense related to RSUs at reporting date $ 4,443

Fair Value Measurements (Tables

Fair Value Measurements (Tables)	3 Months Ended
	Dec. 31, 2018
Fair Value Disclosures [Abstract]
Assets Categorized on Basis of Various Levels	Based on the definitions, the following table represents the Company’s assets categorized in the Level 1 to 3 hierarchies as of December 31, 2018, and September 30, 2018: Fair Value Measurements at December 31, 2018 Level 1 Level 2 Level 3 Total (In thousands) Money market fund deposits $ 19,557 $ — $ — $ 19,557 Mutual fund investments 9 — — 9 Total $ 19,566 $ — $ — $ 19,566 Amounts included in: Cash and cash equivalents $ 19,557 $ — $ — $ 19,557 Investments in marketable securities 9 — — 9 Total $ 19,566 $ — $ — $ 19,566 Fair Value Measurements at September 30, 2018 Level 1 Level 2 Level 3 Total (In thousands) Money market fund deposits $22,978 $— $— $22,978 Mutual fund investments 9 — — 9 Total $22,987 $— $— $22,987 Amounts included in: Cash and cash equivalents $22,978 $— $— $22,978 Investments in marketable securities 9 — — 9 Total $22,987 $— $— $22,987

Basis of Financial Statement _3

Basis of Financial Statement Presentation - Additional Information (Detail)	3 Months Ended
	Dec. 31, 2018Funds
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Number of Hennessy funds to which company provides investment advisory services	16

Management Contracts Purchased

Management Contracts Purchased - Additional Information (Detail)	Oct. 26, 2018USD ($)	Dec. 31, 2018USD ($)Funds	Sep. 30, 2018USD ($)
Contracts In Progress Costs And Earnings [Line Items]
Number of mutual funds | Funds		30
Management contracts impairment amount		$ 0	$ 0
Bp Capital Fund Advisors Llc [Member]
Contracts In Progress Costs And Earnings [Line Items]
Business combination, assets acquired and liabilities assumed, assets	$ 200,000,000
Business combination, agreement date	Jul. 10, 2018
Business combination, cash paid	$ 1,600,000
Business combination, consideration transferred, other	$ 100,000
Business acquisition, effective date of acquisition	Oct. 25, 2018

Investment Advisory Agreements

Investment Advisory Agreements - Additional Information (Detail)	3 Months Ended
	Dec. 31, 2018Funds
Investments Schedule [Abstract]
Number of Hennessy funds to which company provides investment advisory services	16
Notice period for termination of agreement	60 days

Bank Loan - Additional Informat

Bank Loan - Additional Information (Detail)	Dec. 31, 2018USD ($)	Dec. 03, 2018	Sep. 20, 2018	Dec. 31, 2018USD ($)Installment	Dec. 31, 2017USD ($)	Sep. 17, 2015USD ($)
Debt Instrument [Line Items]
Long-term debt, gross	$ 20,800,000			$ 20,800,000
Long-term debt	20,700,000			$ 20,700,000
US Bank National Association Loan [Member]
Debt Instrument [Line Items]
Outstanding bank loan						$ 35,000,000
Number of monthly installments payable | Installment				60
Required monthly loan principal repayment				$ 364,583
Final installment date				Sep. 17, 2020
Amortized loan costs				$ 410,000
Amortized cost on straight-line basis in months				60 months
Amortization expenses				$ 40,000	$ 40,000
Unamortized loan cost	$ 100,000			$ 100,000
US Bank National Association Loan [Member] | Promissory Note [Member]
Debt Instrument [Line Items]
Outstanding bank loan						20,000,000
Extend maturity date loan			1 year
Amended agreement description				(a) on September 19, 2016, to allow the Company to purchase the assets related to the management of the Westport Fund and the Westport Select Cap Fund (which subsequently were merged into existing Hennessy Funds), (b) on November 16, 2017, to revise the excess cash flow prepayment requirements, (c) on November 30, 2017, to purchase the assets related to the management of the Rainier Large Cap Equity Fund, the Rainier Mid Cap Equity Fund, and the Rainier Small/Mid Cap Equity Fund (collectively, the “Rainier Funds”) (which subsequently were merged into existing Hennessy Funds), and (d) on September 20, 2018, to (i) extend the maturity date of the loan by one year and (ii) allow the Company to purchase the assets related to the management of the BP Funds (which subsequently were merged into newly created Hennessy Funds).
California Bank and Trust Loan [Member] | Promissory Note [Member]
Debt Instrument [Line Items]
Outstanding bank loan						$ 15,000,000
Prime Rate [Member] | US Bank National Association Loan [Member]
Debt Instrument [Line Items]
Debt instrument, interest rate				0.50%
One Month Libor [Member] | US Bank National Association Loan [Member]
Debt Instrument [Line Items]
Debt instrument, interest rate	2.75%			1.00%
Debt instrument converted rate		2.349%
Effective interest rate on debt	5.099%			5.099%
Debt conversion description				The Company intends to renew the LIBOR rate contract on a monthly basis as long as it remains the most favorable option.
Minimum [Member] | London Interbank Offered Rate (LIBOR) [Member] | US Bank National Association Loan [Member]
Debt Instrument [Line Items]
Debt instrument, interest rate				2.75%
Minimum [Member] | One Month Libor [Member] | US Bank National Association Loan [Member]
Debt Instrument [Line Items]
Debt instrument additional basis spread				0.25%
Maximum [Member] | London Interbank Offered Rate (LIBOR) [Member] | US Bank National Association Loan [Member]
Debt Instrument [Line Items]
Debt instrument, interest rate				3.25%
Maximum [Member] | One Month Libor [Member] | US Bank National Association Loan [Member]
Debt Instrument [Line Items]
Debt instrument additional basis spread				0.75%

Income Taxes - Additional Infor

Income Taxes - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended		12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2017
Income Tax Disclosure [Abstract]
Federal corporate income tax rate	21.00%		35.00%
Reduction to income tax expense due to Tax Cuts and Jobs Act of 2017		$ 4.2
Income tax expense non cash benefit,diluted earnings per share		$ 0.54
Effective tax rates	29.90%	33.20%

Income Taxes - Summary of Feder

Income Taxes - Summary of Federal and State Jurisdiction Tax (Detail) - USD ($)	3 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
United States [Member]
Investments, Owned, Federal Income Tax Note [Line Items]
Tax Jurisdiction	$ 0	$ 0	$ 0	$ 0	$ 0
California
Investments, Owned, Federal Income Tax Note [Line Items]
Tax Jurisdiction	0	0	0	0	0
Connecticut [Member]
Investments, Owned, Federal Income Tax Note [Line Items]
Tax Jurisdiction	0	0	0	0	0
District Of Columbia [Member]
Investments, Owned, Federal Income Tax Note [Line Items]
Tax Jurisdiction	0	0	0	0	0
Florida [Member]
Investments, Owned, Federal Income Tax Note [Line Items]
Tax Jurisdiction	0	0	0	0	0
Georgia [Member]
Investments, Owned, Federal Income Tax Note [Line Items]
Tax Jurisdiction	0	0	0	0	0
Illinois [Member]
Investments, Owned, Federal Income Tax Note [Line Items]
Tax Jurisdiction	0	0	0	0	0
Louisiana [Member]
Investments, Owned, Federal Income Tax Note [Line Items]
Tax Jurisdiction	0	0	0	0	0
Maryland [Member]
Investments, Owned, Federal Income Tax Note [Line Items]
Tax Jurisdiction	0	0	0	0	0
Massachusetts [Member]
Investments, Owned, Federal Income Tax Note [Line Items]
Tax Jurisdiction	0	0	0	0	0
Michigan [Member]
Investments, Owned, Federal Income Tax Note [Line Items]
Tax Jurisdiction	0	0	0	0	0
Minnesota [Member]
Investments, Owned, Federal Income Tax Note [Line Items]
Tax Jurisdiction	0	0	0	0	0
New Hampshire [Member]
Investments, Owned, Federal Income Tax Note [Line Items]
Tax Jurisdiction	0	0	0	0	0
New York [Member]
Investments, Owned, Federal Income Tax Note [Line Items]
Tax Jurisdiction	0	0	0	0	0
North Carolina [Member]
Investments, Owned, Federal Income Tax Note [Line Items]
Tax Jurisdiction	0	0	0	0	0
Oregon [Member]
Investments, Owned, Federal Income Tax Note [Line Items]
Tax Jurisdiction	0	0	0	0	0
Texas [Member]
Investments, Owned, Federal Income Tax Note [Line Items]
Tax Jurisdiction	0	0	0	0	0
Wisconsin [Member]
Investments, Owned, Federal Income Tax Note [Line Items]
Tax Jurisdiction	$ 0	$ 0	$ 0	$ 0	$ 0

Earnings per Share and Divide_2

Earnings per Share and Dividends per Share - Additional Information (Detail) - $ / shares	Dec. 05, 2018	Dec. 31, 2018
Weighted Average Amounts Used In Calculating Earnings Per Share [Line Items]
Dividends paid	$ 0.11
Date of record	Nov. 13, 2018
Restricted Stock Units (RSUs) [Member]
Weighted Average Amounts Used In Calculating Earnings Per Share [Line Items]
Stock options excluded from diluted earnings per share		335,350

Equity - Additional Information

Equity - Additional Information (Detail) - USD ($) $ in Thousands	1 Months Ended	3 Months Ended
	Aug. 31, 2010	Dec. 31, 2018	Dec. 31, 2017	Sep. 30, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Maximum common stock issuable under plan		22,500,000		22,500,000
Stock buyback program [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares available for issuance under plan		1,363,211
Repurchase of common stock shares	1,500,000	0	0
Dividend Reinvestment and Stock Purchase Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock issued during period shares		1,503	546
Maximum common stock issuable under plan		1,550,000
Shares available for issuance under plan		1,545,460
Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Maximum Vesting Period		4 years
Rate of restricted stock units vest under plan		25.00%
Compensation expense related to non-vested awards not yet recognized		$ 4,443
Weighted-average vesting period for compensation expenses not yet recognized		2 years 8 months 12 days

Equity - Schedule of Non-Vested

Equity - Schedule of Non-Vested Restricted Stock Units Activity (Detail) - Restricted Stock Units (RSUs) [Member]	3 Months Ended
	Dec. 31, 2018$ / sharesshares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Non-vested Beginning Balance, Number of RSUs | shares	324,771
Granted, Number of RSUs | shares	0
Vested, Number of RSUs | shares	(35,221)
Forfeited, Number of RSUs | shares	0
Non-vested Ending Balance, Number of RSUs | shares	289,550
Non-vested Beginning Balance, Weighted Avg. Fair Value per Share at Each Date | $ / shares	$ 15.43
Granted, Weighted Avg. Fair Value per Share at Each Date | $ / shares	0
Vested, Weighted Avg. Fair Value per Share at Each Date | $ / shares	16.12
Forfeited, Weighted Avg. Fair Value per Share at Each Date | $ / shares	0
Non-vested Ending Balance, Weighted Avg. Fair Value per Share at Each Date | $ / shares	$ 15.34

Equity - Schedule of Non-Vest_2

Equity - Schedule of Non-Vested Restricted Stock Units Activity (Parenthetical) (Detail)	3 Months Ended
	Dec. 31, 2018shares
Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted Stock Awards issued during the period	18,878

Equity - Schedule of Non-Vest_3

Equity - Schedule of Non-Vested Restricted Stock Units Compensation (Detail) - USD ($) $ in Thousands	3 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total expected compensation expense related to RSUs	$ 568	$ 598
Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total expected compensation expense related to RSUs	13,955
Recognized compensation expense related to RSUs at reporting date	(9,512)
Unrecognized compensation expense related to RSUs at reporting date	$ 4,443

Commitments and Contingencies -

Commitments and Contingencies - Additional Information (Detail) $ in Millions	3 Months Ended
	Dec. 31, 2018USD ($)
Commitments and Contingencies Disclosure [Abstract]
Rent expense	$ 0.1

Fair Value Measurements - Asset

Fair Value Measurements - Assets Categorized on Basis of Various Levels (Detail) - USD ($) $ in Thousands	Dec. 31, 2018	Sep. 30, 2018
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Money market fund deposits	$ 19,557	$ 22,978
Mutual fund investments	9	9
Total	19,566	22,987
Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Money market fund deposits	19,557	22,978
Mutual fund investments	9	9
Total	$ 19,566	$ 22,987

Fair Value Measurements - Addit

Fair Value Measurements - Additional Information (Detail) - USD ($)	3 Months Ended	12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018
Fair Value Disclosures [Abstract]
Transfer from fair value level 1 to level 2	$ 0	$ 0
Transfer from fair value level 2 to level 1	0	0
Transfer into (out of) level 3	$ 0	$ 0