Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2013 |
Accounting Policies [Abstract] | ' |
Basis of Presentation | ' |
Basis of Presentation |
The consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”), which require the use of estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and the disclosure of contingent assets and liabilities. Management believes the accounting estimates are appropriate and reasonably stated; however, due to the inherent uncertainties in making estimates, actual amounts could differ from these estimates. |
Principles of Consolidation | ' |
Principles of Consolidation |
The Company consolidates investments in which the Company’s ownership exceeds 50% or in which the Company operates and controls the business and affairs of the entity or is deemed to be the primary beneficiary. In order to make this determination, an analysis is performed to determine if the investment in an affiliate or partnership is a variable interest entity ("VIE"). The Company has evaluated its investments in affiliates and partnerships and has concluded that they are not VIEs. With respect to partnership investments, the limited partners have no control of the business and affairs of the partnership, no substantive ability to dissolve (liquidate) the partnership, or otherwise remove the general partner (CAL and Calamos Investments) without cause or have other substantive rights. |
The consolidated financial statements include the financial statements of CAM, Calamos Investments, Calamos Investments’ wholly- and majority-owned subsidiaries, and the Company’s partnerships in which it owns a majority interest or in which it has operating control. The equity method of accounting is used for investments in which the Company has significant influence, but less than 50% ownership. All significant intercompany balances and transactions have been eliminated. |
The Calamos Interests’ combined 77.8% and 77.9% interest in Calamos Investments at December 31, 2013 and 2012, respectively, is represented as a non-controlling interest in Calamos Investments LLC in the Company’s consolidated financial statements. Non-controlling interest in Calamos Investments is derived by multiplying the historical equity of Calamos Investments by the Calamos Interests’ aggregate ownership percentage for the periods presented. Issuances and repurchases of CAM’s common stock may result in changes to CAM’s ownership percentage and to the non-controlling interests’ ownership percentage of Calamos Investments with resulting changes reflected in the consolidated statements of changes in equity. Income is allocated based on the average ownership interest during the period in which the income is earned. |
CAM owns certain assets to which common stockholders have exclusive economic rights. As of December 31, 2013, 2012 and 2011, these assets include cash, cash equivalents and investment securities of $78.3 million, $67.0 million and $56.3 million, net current and non-current deferred tax assets of $46.7 million, $55.3 million and $65.5 million, and net current income taxes receivable of $2.3 million, $606,000 and $665,000, respectively, that are reported together with Calamos Investments’ consolidated assets in the consolidated statements of financial condition. Additionally, net income before income taxes, of $107.6 million, $141.0 million and $156.4 million for the years ended December 31, 2013, 2012 and 2011, respectively, each included $257,000, $230,000 and $166,000, respectively, of interest income on cash and cash equivalents held solely by CAM. For the year ended December 31, 2011, net income also included $775,000 of professional fees held solely by CAM. These portions of CAM’s income and expense are not affected by non-controlling interests. |
CAL is the general partner and controls the operations of Calamos International Growth Fund LP and Calamos Investments, through a wholly owned subsidiary, is indirectly the general partner and controls the operations of Calamos Arista Strategic Fund LP (formerly Black Strategic Fund, LP) a U.S. feeder fund to Calamos Arista Strategic Master Fund LTD (formerly Black Strategic Master Fund Ltd.) a hedge fund in the Cayman Islands. As CAL and Calamos Investments are the general partners and control the operations of Calamos International Growth Fund LP and Calamos Arista Strategic Fund LP, respectively, and as Calamos Investments has a majority interest in Calamos Arista Strategic Fund LP, the results of these partnerships and the master fund are included into the Company’s consolidated financial results. In December 2013, the limited partners of Calamos International Growth Fund LP redeemed all of their interests in the fund. As a result, the Company deconsolidated Calamos International Growth Fund LP and accounted for this partnership investment using the equity method as of December 31, 2013. Calamos International Growth Fund LP will be dissolved in early 2014. See Note 7, Partnership Investments, for more discussion regarding these funds. |
Calamos Partners LLC, a former subsidiary of Calamos Investments, was the general partner of Calamos Market Neutral Opportunities Fund LP, a private investment partnership that was primarily comprised of highly liquid marketable securities. During the first quarter of 2011, the Calamos Market Neutral Opportunities Fund LP partnership was liquidated. Up to the time the partnership was liquidated, the Company and its affiliates owned a majority interest in this partnership and consolidated the financial results of this partnership into its consolidated financial statements. |
For the periods the partnerships are consolidated, the assets and liabilities of the partnerships are presented on a net basis within partnership investments, net in the consolidated statements of financial condition. The net income for these partnerships are included in investment and other income in the consolidated statements of operations, and the change in partnership investments is included in the net changes in partnership investments in the consolidated statements of cash flows. The partnerships are presented on a net basis in order to provide more clarity to the financial position and results of the core operations of the Company. The underlying assets and liabilities that are being consolidated are described in Note 7, Partnership Investments. The combined interests of all of the consolidated partnerships, not owned by the Company and that are redeemable at the option of the holder, are presented as redeemable non-controlling interest in partnership investments in the Company’s consolidated financial statements for the periods those partnerships were consolidated. |
The Company holds non-controlling interests in certain other partnership investments that are included in partnership investments, net in the consolidated statements of financial condition. These other partnership investments are accounted for under the equity method. |
These portions of CAM’s income and expense are not affected by non-controlling interests. |
CAL is the general partner and controls the operations of Calamos International Growth Fund LP and Calamos Investments, through a wholly owned subsidiary, is indirectly the general partner and controls the operations of Calamos Arista Strategic Fund LP (formerly Black Strategic Fund, LP) a U.S. feeder fund to Calamos Arista Strategic Master Fund LTD (formerly Black Strategic Master Fund Ltd.) a hedge fund in the Cayman Islands. As CAL and Calamos Investments are the general partners and control the operations of Calamos International Growth Fund LP and Calamos Arista Strategic Fund LP, respectively, and as Calamos Investments has a majority interest in Calamos Arista Strategic Fund LP, the results of these partnerships and the master fund are included into the Company’s consolidated financial results. In December 2013, the limited partners of Calamos International Growth Fund LP redeemed all of their interests in the fund. As a result, the Company deconsolidated Calamos International Growth Fund LP and accounted for this partnership investment using the equity method as of December 31, 2013. Calamos International Growth Fund LP will be dissolved in early 2014. See Note 7, Partnership Investments, for more discussion regarding these funds. |
Calamos Partners LLC, a former subsidiary of Calamos Investments, was the general partner of Calamos Market Neutral Opportunities Fund LP, a private investment partnership that was primarily comprised of highly liquid marketable securities. During the first quarter of 2011, the Calamos Market Neutral Opportunities Fund LP partnership was liquidated. Up to the time the partnership was liquidated, the Company and its affiliates owned a majority interest in this partnership and consolidated the financial results of this partnership into its consolidated financial statements. |
For the periods the partnerships are consolidated, the assets and liabilities of the partnerships are presented on a net basis within partnership investments, net in the consolidated statements of financial condition. The net income for these partnerships are included in investment and other income in the consolidated statements of operations, and the change in partnership investments is included in the net changes in partnership investments in the consolidated statements of cash flows. The partnerships are presented on a net basis in order to provide more clarity to the financial position and results of the core operations of the Company. The underlying assets and liabilities that are being consolidated are described in Note 7, Partnership Investments. The combined interests of all of the consolidated partnerships, not owned by the Company and that are redeemable at the option of the holder, are presented as redeemable non-controlling interest in partnership investments in the Company’s consolidated financial statements for the periods those partnerships were consolidated. |
The Company holds non-controlling interests in certain other partnership investments that are included in partnership investments, net in the consolidated statements of financial condition. These other partnership investments are accounted for under the equity method. |
Reclassifications | ' |
Reclassifications |
Certain items previously reported have been reclassified to conform to the current period's consolidated financial statements presentation. |
The Company changed the classification of redeemable non-controlling interest in partnership investments from permanent equity to temporary equity on its consolidated statements of financial condition to conform to accounting guidance that requires non-controlling interests that are redeemable or convertible for cash or other assets at the option of the holder to be classified as temporary equity. |
Amortization of deferred sales commissions, previously presented as a separate line, is now included with distribution expenses; and the classification of deferred sales commissions asset, previously presented on a separate line, is now included with other non-current assets. Deferred sales commissions asset and amortization became immaterial, with the discontinuation of the sale of Class B shares, making the separate line presentations less meaningful to the financial statement users. |
Investment securities previously presented as CFS securities are being presented as Trading securities. Certain investments previously presented as Other are being presented as Alternative in Note 5, Investment Securities, and Note 8, Fair Value Measurements. |
These reclassifications have been made for all periods presented. |
Cash and Cash Equivalents | ' |
Cash and Cash Equivalents |
All highly liquid financial instruments with maturities of three months or less from date of purchase, consisting primarily of investments in insured money market accounts and money market funds, are considered cash equivalents |
Receivables from Customers | ' |
Receivables from Customers |
Receivables from customers represent balances arising from contractual investment advisory services provided to separate account customers and are recorded on an accrual basis. Provisions for bad debt expense during the years ended December 31, 2013, 2012, and 2011 and allowance for doubtful accounts as of December 31, 2013 and 2012, were not material |
Investment Securities | ' |
Investment Securities |
The Company carries its investment securities at fair value. For a majority of the Company’s investments, fair values are determined based upon quoted prices in active markets. If quoted market prices are not available, the Company uses matrix, model or other similar pricing methods to determine fair value. Investment securities transactions are recorded on a trade-date basis. |
Investment securities are classified as available-for-sale as the Company does not intend to trade these securities in the near term. Unrealized gains and losses on available-for-sale securities are excluded from earnings and are reported, net of income tax, as a separate component of equity until realized. Realized gains and losses from the sale of available-for-sale securities are determined on a specific identification basis and are included in investment and other income in the consolidated statements of operations. |
Investment securities classified as trading securities are carried at fair value with all changes in the value of the securities going through current earnings. Therefore, both realized and unrealized gains and losses on these securities are included in investment and other income in the consolidated statements of operations. |
On a quarterly basis, the Company conducts reviews to assess whether an other-than-temporary impairment exists on its available-for-sale investment securities. Other-than-temporary declines in value may exist when the fair value of an investment security has been below the carrying value for an extended period of time. If an other-than-temporary decline in value is determined to exist, the unrealized investment loss, net of tax is recognized in the consolidated statements of operations in the period in which the other-than-temporary decline in value occurs, as well as an accompanying permanent adjustment to accumulated other comprehensive income. |
Derivative Assets and Liabilities | ' |
Derivative Assets and Liabilities |
From time to time, the Company enters into derivative contracts to mitigate the negative impact that changes in security prices may have on the investment portfolio. The Company does not measure effectiveness or meet the criteria for hedge accounting and, therefore, records the changes in the fair value of these instruments in investment and other income in the consolidated statements of operations. The Company classifies derivatives as derivative assets and derivative liabilities in the consolidated statements of financial condition. |
Goodwill | ' |
Goodwill |
The Company’s goodwill represents the future economic benefits arising from Calamos Investments’ acquisition of Black Capital, LLC (“Black Capital”) that are not individually identified and separately recognized. Goodwill is assessed for impairment at the reporting unit level, Calamos Investments, at least annually, or whenever events or circumstances occur indicating that an impairment may have occurred. The goodwill impairment test is a two-step process. The first step requires the Company to estimate the fair value of its reporting unit and compare the fair value to the reporting unit’s carrying amount. If the fair value exceeds the carrying amount, the goodwill is not considered impaired. To the extent the reporting unit’s carrying amount exceeds its fair value, the reporting unit’s goodwill may be impaired and the second step of the impairment test must be performed. The second step involves assigning the reporting unit’s fair value to all of its recognized and unrecognized assets and liabilities as if the reporting unit had been acquired in a business combination in order to determine the implied fair value of the reporting unit’s goodwill. The implied fair value of the reporting unit’s goodwill is then compared to the carrying amount of goodwill to quantify an impairment loss, if any, which would equal the excess of the carrying amount of goodwill over the goodwill’s implied fair value. No impairment has been recorded for the years ended December 31, 2013 and December 31, 2012. See Note 3, Acquisition for more discussion related to the acquisition of Black Capital. |
Property and Equipment | ' |
Property and Equipment |
Property and equipment are recorded at cost less accumulated depreciation and amortization. Depreciation and amortization is provided on a straight-line basis over the estimated useful lives of the assets, ranging from three to twenty years. Leasehold improvements are amortized over the shorter of their estimated useful lives or the remaining term of the lease, ranging from five to twenty years. |
Internally Developed Software | ' |
Internally Developed Software |
Certain internal and external development costs incurred in connection with developing or obtaining software for internal use are capitalized. These capitalized costs are included in property and equipment, net in the consolidated statements of financial condition and are amortized using the straight-line method over their estimated useful lives, ranging from three to ten years. On an annual basis, the Company conducts reviews to assess the functionality and remaining useful lives of the capitalized software. Impairments of these assets, if any, are recognized in the consolidated statements of operations in the period in which the impairment occurs. |
Restricted Cash | ' |
Restricted Cash |
The Company has a $430,000 security deposit that is restricted from the Company’s general corporate use and is being reported in other non-current assets in the consolidated statements of financial condition. |
Compensation Plans | ' |
Compensation Plans |
The Company has an incentive stock plan that provides for certain employees of the Company to receive stock based compensation in the form of restricted stock units (“RSUs”) and stock options. RSUs are convertible on a one-for-one basis into shares of the Company’s common stock. Stock option awards are based on shares of the Company’s common stock. The Company estimates the fair value of the options as of the grant date using the Black-Scholes option-pricing model. Stock based compensation expense is recognized based on the grant-date fair value of the award. The Company records compensation expense on a straight-line basis over the service period. |
Revenue Recognition | ' |
Revenue Recognition |
The Company earns investment management fees by providing services pursuant to the terms of the underlying advisory contract. Fees are based on a contractual investment advisory fee applied to the assets in each portfolio. Any fees collected in advance are deferred and recognized over the period earned. Performance-based advisory fees from certain separate accounts are recognized annually upon completion of the contract year and based upon either (1) the difference between the investment returns on a client’s portfolio compared to a benchmark index or (2) the absolute percentage of gain in the client’s account. Performance-based advisory fees from the open-end funds are recognized monthly when earned and are based upon the differences between the investment returns of the respective fund compared to a benchmark index. |
Distribution and underwriting fees consist primarily of Rule 12b-1 distribution and/or service fees from the open-end funds, contingent deferred sales charges on the redemption of open-end fund shares and sales charges earned on open-end funds. Distribution service fees are accrued monthly as services are performed and are based on the average daily assets of the open-end funds. Contingent deferred sales charges are recorded on a trade-date basis when earned, and sales charges are recorded on the settlement date. |
Net Interest Expense | ' |
Net Interest Expense |
Net interest expense represents interest expense incurred on debt net of interest income generated from cash and cash equivalents. Interest income is recognized when earned, and interest expense is recorded when incurred. |
Investment and Other Income | ' |
Investment and Other Income |
Investment and other income is primarily comprised of: realized gains (losses) from all investment securities and partnership investments; unrealized gains (losses) on trading securities and partnership investments; realized and unrealized gains (losses) on derivatives; gains (losses) on foreign currency translation; and dividend income. Dividend income is recognized on the ex-dividend date. |
Foreign Currency | ' |
Foreign Currency |
Foreign currency balances are revalued into U.S. dollars, which is the functional currency of the Company, at prevailing exchange rates on the reporting date. Revenues earned and expenses incurred in foreign currency are revalued at average exchange rates during the reporting period. Gains and losses arising from the revaluation of account balances denominated in foreign currencies are recognized in investment and other income in the consolidated statements of operations. |
Income Taxes | ' |
Income Taxes |
Deferred tax assets and liabilities are recognized for the future tax consequences attributable to the temporary differences between the financial statement carrying amount of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. During 2013, 2012 and 2011, the Company recorded valuation allowance adjustments to reduce or increase its deferred income tax assets to an amount that is more likely than not to be realized based on available evidence at the time estimates are made. Determining a valuation allowance requires management to make significant judgments and assumptions. In determining a valuation allowance the Company uses historical and forecasted future realized and unrealized gains and losses on its investment, ongoing tax planning strategies, and forecasts of future taxable income. Each quarter the Company re-evaluates its estimates related to its valuation allowance, including its assumptions about future taxable income. The Company’s capital loss carryforward is used against realized gains on its investment, derivative assets, derivative liabilities and partnership investments, using its tax harvesting strategies. See Note 16, Income Taxes for more discussion related to the deferred tax valuation allowance. |
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Future interest or penalties related to uncertain income tax positions are recognized in income tax provision when determined. The Company did not record any accrued interest or penalties related to uncertain tax positions through December 31, 2013. |
Advertising Costs | ' |
Advertising Costs |
Advertising costs are expensed as incurred and are included in marketing and sales promotion expenses in the consolidated statements of operations. |
Earnings Per Share | ' |
Earnings Per Share |
Basic earnings per share is computed by dividing net income attributable to CAM by the weighted average number of shares of Class A and Class B common stock outstanding during each year. Shares issued or repurchased during the year are weighted for the portion of the year that they were outstanding. Diluted earnings per share reflects the potential dilution that would occur if RSUs and stock options granted to participants of the Company incentive compensation plan were exercised and if the Calamos Interests exchanged all of their ownership interest in Calamos Investments and their Class B common stock for shares of Class A common stock. Diluted shares which result in anti-dilution are excluded from the diluted earnings per share calculation and are detailed in Note 17, Earnings Per Share. |