Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2019 | May 02, 2019 | |
Document Information [Line Items] | ||
Entity Registrant Name | KKR & Co. Inc. | |
Entity Central Index Key | 0001404912 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Entity Emerging Growth Company | false | |
Entity Small Business | false | |
Class A Common Stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 543,943,670 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (UNAUDITED) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 | |
Assets | |||
Cash and Cash Equivalents | $ 1,808,368 | $ 1,751,287 | |
Cash and Cash Equivalents Held at Consolidated Entities | 911,450 | 693,860 | |
Restricted Cash and Cash Equivalents | 66,950 | 196,365 | |
Investments | 45,795,254 | 44,907,982 | |
Due from Affiliates | 734,195 | 657,189 | |
Other Assets | 2,687,802 | 2,536,692 | |
Total Assets | 52,004,019 | 50,743,375 | |
Liabilities and Equity | |||
Debt Obligations | 22,262,369 | 22,341,192 | |
Due to Affiliates | 254,781 | 275,584 | |
Accounts Payable, Accrued Expenses and Other Liabilities | 3,279,028 | 2,743,990 | |
Total Liabilities | 25,796,178 | 25,360,766 | |
Commitments and Contingencies | |||
Redeemable Noncontrolling Interests | 0 | 1,122,641 | |
Stockholders' Equity | |||
Series A and B Preferred Stock, $0.01 par value. 13,800,000 and 6,200,000 shares, respectively, issued and outstanding as of March 31, 2019 and December 31, 2018. | [1] | 482,554 | 482,554 |
Additional Paid-In Capital | [1] | 8,145,133 | 8,106,408 |
Retained Earnings | [1] | 726,312 | 91,953 |
Accumulated Other Comprehensive Income (Loss) | [1] | (39,954) | (39,645) |
Total KKR & Co. Inc. Stockholders' Equity | [1] | 9,322,371 | 8,649,610 |
Noncontrolling Interests | [1] | 16,885,470 | 15,610,358 |
Total Equity | [1] | 26,207,841 | 24,259,968 |
Total Liabilities and Equity | 52,004,019 | 50,743,375 | |
Consolidated VIEs | |||
Assets | |||
Cash and Cash Equivalents Held at Consolidated Entities | 725,717 | 605,114 | |
Restricted Cash and Cash Equivalents | 35,692 | 174,057 | |
Investments | 30,316,038 | 30,319,052 | |
Due from Affiliates | 11,181 | 11,832 | |
Other Assets | 390,545 | 371,275 | |
Total Assets | 31,479,173 | 31,481,330 | |
Liabilities and Equity | |||
Debt Obligations | 15,496,761 | 15,351,541 | |
Accounts Payable, Accrued Expenses and Other Liabilities | 646,241 | 705,741 | |
Total Liabilities | 16,143,002 | 16,057,282 | |
Consolidated VIEs | Consolidated CFEs | |||
Assets | |||
Cash and Cash Equivalents Held at Consolidated Entities | 641,685 | 428,850 | |
Restricted Cash and Cash Equivalents | 0 | 0 | |
Investments | 15,021,345 | 14,733,423 | |
Due from Affiliates | 0 | 0 | |
Other Assets | 166,373 | 148,221 | |
Total Assets | 15,829,403 | 15,310,494 | |
Liabilities and Equity | |||
Debt Obligations | 14,472,392 | 13,958,554 | |
Accounts Payable, Accrued Expenses and Other Liabilities | 576,009 | 579,408 | |
Total Liabilities | 15,048,401 | 14,537,962 | |
Consolidated VIEs | Consolidated KKR Funds and Other Entities | |||
Assets | |||
Cash and Cash Equivalents Held at Consolidated Entities | 84,032 | 176,264 | |
Restricted Cash and Cash Equivalents | 35,692 | 174,057 | |
Investments | 15,294,693 | 15,585,629 | |
Due from Affiliates | 11,181 | 11,832 | |
Other Assets | 224,172 | 223,054 | |
Total Assets | 15,649,770 | 16,170,836 | |
Liabilities and Equity | |||
Debt Obligations | 1,024,369 | 1,392,987 | |
Accounts Payable, Accrued Expenses and Other Liabilities | 70,232 | 126,333 | |
Total Liabilities | 1,094,601 | 1,519,320 | |
Class A Common Stock | |||
Stockholders' Equity | |||
Common Stock | [1] | 5,339 | 5,349 |
Class B Common Stock | |||
Stockholders' Equity | |||
Common Stock | [1] | 0 | 0 |
Class C Common Stock | |||
Stockholders' Equity | |||
Common Stock | [1] | $ 2,987 | $ 2,991 |
[1] | See Note 1 "Organization." |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (UNAUDITED) (Parenthetical) - $ / shares | Mar. 31, 2019 | Dec. 31, 2018 | |
Series A Preferred Stock | |||
Preferred stock, par value (in dollars per share) | [1] | $ 0.01 | $ 0.01 |
Preferred stock, shares issued (in shares) | [1] | 13,800,000 | 13,800,000 |
Preferred stock, shares outstanding (in shares) | [1] | 13,800,000 | 13,800,000 |
Series B Preferred Stock | |||
Preferred stock, par value (in dollars per share) | [1] | $ 0.01 | $ 0.01 |
Preferred stock, shares issued (in shares) | [1] | 6,200,000 | 6,200,000 |
Preferred stock, shares outstanding (in shares) | [1] | 6,200,000 | 6,200,000 |
Class A Common Stock | |||
Common stock, par value (in dollars per share) | [1] | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | [1] | 3,500,000,000 | 3,500,000,000 |
Common stock, shares issued (in shares) | [1] | 533,922,902 | 534,857,237 |
Common stock, shares outstanding (in shares) | [1] | 533,922,902 | 534,857,237 |
Class B Common Stock | |||
Common stock, par value (in dollars per share) | [1] | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | [1] | 1 | 1 |
Common stock, shares issued (in shares) | [1] | 1 | 1 |
Common stock, shares outstanding (in shares) | [1] | 1 | 1 |
Class C Common Stock | |||
Common stock, par value (in dollars per share) | [1] | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | [1] | 499,999,999 | 499,999,999 |
Common stock, shares issued (in shares) | [1] | 298,645,285 | 299,081,239 |
Common stock, shares outstanding (in shares) | [1] | 298,645,285 | 299,081,239 |
[1] | See Note 1 "Organization." |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Revenues | ||
Fees and Other | $ 372,548 | $ 394,394 |
Capital Allocation-Based Income | 814,932 | 78,212 |
Total Revenues | 1,187,480 | 472,606 |
Expenses | ||
Compensation and Benefits | 544,562 | 298,136 |
Occupancy and Related Charges | 14,690 | 14,215 |
General, Administrative and Other | 169,515 | 124,250 |
Total Expenses | 728,767 | 436,601 |
Investment Income (Loss) | ||
Net Gains (Losses) from Investment Activities | 1,203,878 | 472,800 |
Dividend Income | 22,625 | 33,064 |
Interest Income | 358,511 | 298,256 |
Interest Expense | (249,088) | (219,590) |
Total Investment Income (Loss) | 1,335,926 | 584,530 |
Income (Loss) Before Taxes | 1,794,639 | 620,535 |
Income Tax Expense (Benefit) | 167,593 | 17,641 |
Net Income (Loss) | 1,627,046 | 602,894 |
Net Income (Loss) Attributable to Redeemable Noncontrolling Interests | 0 | 25,674 |
Net Income (Loss) Attributable to Noncontrolling Interests | 917,727 | 398,777 |
Net Income (Loss) Attributable to KKR & Co. Inc. | 709,319 | 178,443 |
Preferred Dividends | 8,341 | 8,341 |
Net Income (Loss) Attributable to KKR & Co. Inc. Class A Common Stockholders | 700,978 | 170,102 |
Series A Preferred Stock Dividends | ||
Investment Income (Loss) | ||
Preferred Dividends | 5,822 | 5,822 |
Series B Preferred Stock Dividends | ||
Investment Income (Loss) | ||
Preferred Dividends | 2,519 | 2,519 |
Class A Common Stock | ||
Investment Income (Loss) | ||
Net Income (Loss) Attributable to KKR & Co. Inc. Class A Common Stockholders | $ 700,978 | $ 170,102 |
Net Income (Loss) Attributable to KKR & Co. Inc. Per Share of Class A Common Stock | ||
Basic (in dollars per share) | $ 1.31 | $ 0.36 |
Diluted (in dollars per share) | $ 1.27 | $ 0.32 |
Weighted Average Shares of Class A Common Stock Outstanding | ||
Basic (in shares) | 533,892,474 | 487,704,838 |
Diluted (in shares) | 550,046,440 | 535,918,274 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (UNAUDITED) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Statement of Comprehensive Income [Abstract] | ||
Net Income (Loss) | $ 1,627,046 | $ 602,894 |
Other Comprehensive Income (Loss), Net of Tax: | ||
Foreign Currency Translation Adjustments | 2,366 | 3,624 |
Comprehensive Income (Loss) | 1,629,412 | 606,518 |
Less: Comprehensive Income (Loss) Attributable to Redeemable Noncontrolling Interests | 0 | 25,674 |
Less: Comprehensive Income (Loss) Attributable to Noncontrolling Interests | 920,359 | 398,050 |
Comprehensive Income (Loss) Attributable to KKR & Co. Inc. | $ 709,053 | $ 182,794 |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (UNAUDITED) - USD ($) $ in Thousands | Total | Preferred Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Class A Common StockCommon Stock | Class B Common StockCommon Stock | Class C Common StockCommon Stock | Series A Preferred StockRetained Earnings | Series B Preferred StockRetained Earnings | Common Stock | Capital - Common Unitholders | Accumulated Other Comprehensive Income (Loss) | Total Capital - Common Units | Series A Preferred Stock Dividends | Series B Preferred Stock Dividends | Noncontrolling Interests | ||
KKR & Co. L.P. Partners' Capital - beginning balance at Dec. 31, 2017 | $ 20,052,260 | $ 6,722,863 | $ (19,481) | $ 6,703,382 | $ 332,988 | $ 149,566 | $ 12,866,324 | ||||||||||||
KKR & Co. L.P. Partners' Capital - beginning balance (in units) at Dec. 31, 2017 | 486,174,736 | ||||||||||||||||||
Increase (Decrease) in Partners' Capital | |||||||||||||||||||
Net Income (Loss) | 577,220 | 170,102 | 170,102 | 5,822 | 2,519 | 398,777 | |||||||||||||
Other Comprehensive Income (Loss)- Foreign Currency Translation (Net of Tax) | 3,624 | 4,351 | 4,351 | (727) | |||||||||||||||
Exchange of KKR Holdings L.P. Units and Other Securities to KKR & Co. L.P. Common Units | 51,221 | (132) | 51,089 | (51,089) | |||||||||||||||
Exchange of KKR Holdings L.P. Units and Other Securities to KKR & Co. L.P. Common Units (in units) | 3,067,306 | ||||||||||||||||||
Tax Effects Resulting from Exchange of KKR Holdings L.P. Units and Other | 4,222 | 4,205 | 17 | 4,222 | |||||||||||||||
Equity-Based and Other Non-Cash Compensation | 100,491 | 67,796 | 67,796 | 32,695 | |||||||||||||||
Capital Contributions | 1,270,723 | 1,270,723 | |||||||||||||||||
Capital Distributions | (930,232) | (82,757) | (82,757) | (5,822) | (2,519) | (839,134) | |||||||||||||
KKR & Co. L.P. Partners' Capital - ending balance at Mar. 31, 2018 | 21,078,308 | $ 6,933,430 | $ (15,245) | $ 6,918,185 | $ 332,988 | $ 149,566 | 13,677,569 | ||||||||||||
KKR & Co. L.P. Partners' Capital - ending balance (in units) at Mar. 31, 2018 | 489,242,042 | ||||||||||||||||||
Balance at Dec. 31, 2017 | 610,540 | ||||||||||||||||||
Increase (Decrease) in Redeemable Noncontrolling Interests | |||||||||||||||||||
Net Income (Loss) | 25,674 | ||||||||||||||||||
Capital Contributions | 56,950 | ||||||||||||||||||
Capital Distributions | (2,534) | ||||||||||||||||||
Balance at Mar. 31, 2018 | 690,630 | ||||||||||||||||||
Increase (Decrease) in Stockholders' Equity | |||||||||||||||||||
Net Income (Loss) Attributable to KKR & Co. Inc. | 178,443 | ||||||||||||||||||
Noncontrolling Interests (See Note 15 Equity) | [1] | 15,610,358 | |||||||||||||||||
Total Equity | [1] | 24,259,968 | |||||||||||||||||
Other Comprehensive Income (Loss)- Foreign Currency Translation (Net of Tax) | 2,366 | $ (266) | |||||||||||||||||
Exchange of KKR Holdings L.P. Units and Other Securities to KKR & Co. L.P. Common Units | $ 7,137 | (43) | $ 4 | ||||||||||||||||
Exchange of KKR Holdings L.P. Units and Other Securities to KKR & Co. L.P. Common Units (in units) | 435,954 | ||||||||||||||||||
Tax Effects Resulting from Exchange of KKR Holdings L.P. Units and Other | 5,255 | 5,255 | |||||||||||||||||
Capital Contributions | 1,194,815 | ||||||||||||||||||
Capital Distributions | $ (856,086) | ||||||||||||||||||
Balance at Dec. 31, 2018 | 1,122,641 | ||||||||||||||||||
Increase (Decrease) in Redeemable Noncontrolling Interests | |||||||||||||||||||
Net Income (Loss) | 0 | ||||||||||||||||||
Balance at Mar. 31, 2019 | 0 | ||||||||||||||||||
Stockholders' equity, beginning balance at Dec. 31, 2018 | 8,649,610 | [1] | $ 482,554 | 8,106,408 | $ 91,953 | (39,645) | $ 5,349 | $ 0 | $ 2,991 | ||||||||||
Shares outstanding, beginning balance (in shares) at Dec. 31, 2018 | 20,000,000 | 534,857,237 | 1 | 299,081,239 | |||||||||||||||
Increase (Decrease) in Stockholders' Equity | |||||||||||||||||||
Repurchases of Class A Common Stock | (28,552) | $ (14) | |||||||||||||||||
Repurchases of Class A Common Stock (in shares) | (1,370,289) | ||||||||||||||||||
Cancellation of Class C Common Stock | $ (4) | ||||||||||||||||||
Cancellation of Class C Common Stock (in shares) | (435,954) | ||||||||||||||||||
Equity-Based Compensation | 54,885 | ||||||||||||||||||
Net Income (Loss) Attributable to KKR & Co. Inc. | 709,319 | 709,319 | |||||||||||||||||
Series A Preferred Stock Dividends ($0.421875 per share) | $ (5,822) | $ (2,519) | |||||||||||||||||
Common Stock Dividends | (66,619) | ||||||||||||||||||
Stockholders' equity, ending balance at Mar. 31, 2019 | 9,322,371 | [1] | $ 482,554 | $ 8,145,133 | $ 726,312 | $ (39,954) | $ 5,339 | $ 0 | $ 2,987 | ||||||||||
Shares outstanding, ending balance (in shares) at Mar. 31, 2019 | 20,000,000 | 533,922,902 | 1 | 298,645,285 | |||||||||||||||
Increase (Decrease) in Stockholders' Equity | |||||||||||||||||||
Noncontrolling Interests (See Note 15 Equity) | [1] | 16,885,470 | |||||||||||||||||
Total Equity | [1] | $ 26,207,841 | |||||||||||||||||
[1] | See Note 1 "Organization." |
CONDENSED CONSOLIDATED STATEM_6
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (UNAUDITED) (Parenthetical) | 3 Months Ended |
Mar. 31, 2019$ / shares | |
Dividend declared (in dollars per share) | $ 0.125 |
Series A Preferred Stock | |
Dividend declared (in dollars per share) | 0.421875 |
Series B Preferred Stock | |
Dividend declared (in dollars per share) | $ 0.406250 |
CONDENSED CONSOLIDATED STATEM_7
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Operating Activities | ||
Net Income (Loss) | $ 1,627,046 | $ 602,894 |
Adjustments to Reconcile Net Income (Loss) to Net Cash Provided (Used) by Operating Activities: | ||
Equity-Based and Other Non-Cash Compensation | 78,268 | 96,227 |
Net Realized (Gains) Losses on Investments | (129,781) | (30,380) |
Change in Unrealized (Gains) Losses on Investments | (1,074,097) | (442,420) |
Capital Allocation-Based Income | (814,932) | (78,212) |
Other Non-Cash Amounts | (12,111) | 74,156 |
Cash Flows Due to Changes in Operating Assets and Liabilities: | ||
Change in Consolidation and Other | (137,498) | 0 |
Change in Due from / to Affiliates | (100,529) | (71,686) |
Change in Other Assets | 68,077 | 420,004 |
Change in Accounts Payable, Accrued Expenses and Other Liabilities | 381,421 | (41,480) |
Investments Purchased | (5,301,227) | (9,515,686) |
Proceeds from Investments | 5,571,641 | 6,829,083 |
Net Cash Provided (Used) by Operating Activities | 156,278 | (2,157,500) |
Investing Activities | ||
Purchases of Fixed Assets | (19,455) | (8,670) |
Development of Oil and Natural Gas Properties | (451) | 0 |
Net Cash Provided (Used) by Investing Activities | (19,906) | (8,670) |
Financing Activities | ||
Preferred Stock Dividends | (8,341) | (8,341) |
Common Stock Dividends | (66,619) | (82,757) |
Distributions to Redeemable Noncontrolling Interests | 0 | (2,534) |
Contributions from Redeemable Noncontrolling Interests | 0 | 56,950 |
Distributions to Noncontrolling Interests | (856,086) | (839,134) |
Contributions from Noncontrolling Interests | 1,194,815 | 1,263,774 |
Proceeds from Debt Obligations | 1,581,043 | 3,588,463 |
Repayment of Debt Obligations | (1,806,203) | (2,750,750) |
Financing Costs Paid | (2,795) | (7,500) |
Net Cash Provided (Used) by Financing Activities | 7,248 | 1,218,171 |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | 1,636 | 20,902 |
Net Increase/(Decrease) in Cash, Cash Equivalents and Restricted Cash | 145,256 | (927,097) |
Cash, Cash Equivalents and Restricted Cash, Beginning of Period | 2,641,512 | 3,735,361 |
Cash, Cash Equivalents and Restricted Cash, End of Period | 2,786,768 | 2,808,264 |
Supplemental Disclosures of Cash Flow Information | ||
Payments for Interest | 240,889 | 207,703 |
Payments for Income Taxes | 8,901 | 19,295 |
Payments for Operating Lease Liabilities | 12,291 | 0 |
Supplemental Disclosures of Non-Cash Investing and Financing Activities | ||
Equity-Based and Other Non-Cash Contributions | 78,003 | 100,491 |
Non-Cash Contributions from Noncontrolling Interests | 0 | 6,949 |
Debt Obligations - Net Gains (Losses), Translation and Other | (148,312) | (11,724) |
Tax Effects Resulting from Exchange of KKR Holdings L.P. Units and delivery of Class A Common Stock | 5,255 | 4,222 |
Change in Consolidation and Other | ||
Investments | (1,014,813) | 0 |
Due From Affiliates | 1,642 | 0 |
Other Assets | (19,703) | 0 |
Accounts Payable, Accrued Expenses and Other Liabilities | (47,731) | 0 |
Redeemable Noncontrolling Interests | (1,122,641) | 0 |
Reconciliation to the Condensed Consolidated Statements of Financial Condition | ||
Cash, Cash Equivalents and Restricted Cash, End of Period | 2,641,512 | 3,735,361 |
Class A Common Stock | ||
Financing Activities | ||
Repurchases of Class A Common Stock | $ (28,566) | $ 0 |
ORGANIZATION
ORGANIZATION | 3 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION | ORGANIZATION KKR & Co. Inc. (NYSE: KKR), together with its subsidiaries ("KKR"), is a leading global investment firm that manages multiple alternative asset classes including private equity, energy, infrastructure, real estate and credit, with strategic partners that manage hedge funds. KKR aims to generate attractive investment returns for its fund investors by following a patient and disciplined investment approach, employing world-class people, and driving growth and value creation with KKR's portfolio companies. KKR invests its own capital alongside the capital it manages for fund investors and provides financing solutions and investment opportunities through its capital markets business. On July 1, 2018, KKR & Co. L.P. converted from a Delaware limited partnership to a Delaware corporation named KKR & Co. Inc. (the "Conversion"). Because the Conversion became effective on July 1, 2018, the prior period amounts in the accompanying condensed consolidated financial statements for the three months ended March 31, 2018, reflect KKR as a limited partnership and not a corporation. In this report, references to KKR & Co. Inc. for periods prior to the Conversion mean KKR & Co. L.P., and references to KKR's Class A common stock, Series A Preferred Stock and Series B Preferred Stock for periods prior to the Conversion mean common units, Series A preferred units and Series B preferred units of KKR & Co. L.P., respectively, in each case, except where the context requires otherwise. As a result of the Conversion, the financial impact to the condensed consolidated financial statements contained herein consisted of (i) reclassifications from partnership equity accounts to equity accounts reflective of a corporation and (ii) a partial step-up in the tax basis of certain assets resulting in the recognition of a net income tax benefit. KKR & Co. Inc. is the parent company of KKR Group Holdings Corp., which is (i) a general partner of KKR Fund Holdings L.P. ("Fund Holdings") and KKR International Holdings L.P. ("International Holdings") and (ii) the sole stockholder of KKR Management Holdings Corp. (the general partner of KKR Management Holdings L.P. ("Management Holdings")) and KKR Fund Holdings GP Limited (the other general partner of Fund Holdings and International Holdings). Fund Holdings, Management Holdings and International Holdings are collectively referred to as the "KKR Group Partnerships." KKR & Co. Inc. both indirectly controls the KKR Group Partnerships and indirectly holds Class A partner units in each KKR Group Partnership (collectively, "KKR Group Partnership Units") representing economic interests in KKR's business. The remaining KKR Group Partnership Units are held by KKR Holdings L.P. ("KKR Holdings"), which is not a subsidiary of KKR & Co. Inc. As of March 31, 2019 , KKR & Co. Inc. held approximately 64.1% of the KKR Group Partnership Units and principals through KKR Holdings held approximately 35.9% of the KKR Group Partnership Units. The percentage ownership in the KKR Group Partnerships will continue to change as KKR Holdings and/or principals exchange units in the KKR Group Partnerships for shares of Class A common stock of KKR & Co. Inc. or when KKR & Co. Inc. otherwise issues or repurchases shares of Class A common stock of KKR & Co. Inc. The KKR Group Partnerships also have outstanding equity interests that provide for the carry pool and preferred units with economic terms that mirror the preferred stock issued by KKR & Co. Inc. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying unaudited financial statements of KKR & Co. Inc. have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") for interim financial information and the instructions to Form 10-Q. The condensed consolidated financial statements (referred to hereafter as the "financial statements"), including these notes, are unaudited and exclude some of the disclosures required in annual financial statements. Management believes it has made all necessary adjustments (consisting of only normal recurring items) such that the financial statements are presented fairly and that estimates made in preparing the financial statements are reasonable and prudent. The operating results presented for interim periods are not necessarily indicative of the results that may be expected for any other interim period or for the entire year. The December 31, 2018 consolidated balance sheet data was derived from audited financial statements included in KKR's Annual Report on Form 10-K for the year ended December 31, 2018, filed with the Securities and Exchange Commission (the "SEC") on February 15, 2019, and the financial statements should be read in conjunction with the audited financial statements included therein. Additionally, in the accompanying financial statements the condensed consolidated statements of financial condition are referred to hereafter as the “consolidated statements of financial condition”; the condensed consolidated statements of operations are referred to hereafter as the “consolidated statements of operations”; the condensed consolidated statements of comprehensive income (loss) are referred to hereafter as the “consolidated statements of comprehensive income (loss)”; the condensed consolidated statements of changes in equity are referred to hereafter as the “consolidated statements of changes in equity”; and the condensed consolidated statements of cash flows are referred to hereafter as the “consolidated statements of cash flows." KKR consolidates the financial results of the KKR Group Partnerships and their consolidated entities, which include the accounts of KKR's investment management and capital markets companies, the general partners of certain unconsolidated investment funds, general partners of consolidated investment funds and their respective consolidated investment funds, and certain other entities including CFEs. References in the accompanying financial statements to "principals" are to KKR's senior employees and non-employee operating consultants who hold interests in KKR's business through KKR Holdings. All intercompany transactions and balances have been eliminated. Use of Estimates The preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues, expenses, and investment income (loss) during the reporting periods. Such estimates include but are not limited to (i) the determination of the income tax provision and (ii) the valuation of investments and financial instruments. Actual results could differ from those estimates, and such differences could be material to the financial statements. Principles of Consolidation The types of entities KKR assesses for consolidation include (i) subsidiaries, including management companies, broker-dealers and general partners of investment funds that KKR manages, (ii) entities that have all the attributes of an investment company, like investment funds, (iii) CFEs and (iv) other entities, including entities that employ non-employee operating consultants. Each of these entities is assessed for consolidation on a case by case basis depending on the specific facts and circumstances surrounding that entity. Pursuant to its consolidation policy, KKR first considers whether an entity is considered a VIE and therefore whether to apply the consolidation guidance under the VIE model. Entities that do not qualify as VIEs are assessed for consolidation as voting interest entities ("VOEs") under the voting interest model. KKR's funds are, for GAAP purposes, investment companies and therefore are not required to consolidate their investments in portfolio companies even if majority-owned and controlled. Rather, the consolidated funds and vehicles reflect their investments at fair value as described below in "Fair Value Measurements." An entity in which KKR holds a variable interest is a VIE if any one of the following conditions exist: (a) the total equity investment at risk is not sufficient to permit the legal entity to finance its activities without additional subordinated financial support, (b) the holders of the equity investment at risk (as a group) lack either the direct or indirect ability through voting rights or similar rights to make decisions about a legal entity's activities that have a significant effect on the success of the legal entity or the obligation to absorb the expected losses or right to receive the expected residual returns, or (c) the voting rights of some investors are disproportionate to their obligation to absorb the expected losses of the legal entity, their rights to receive the expected residual returns of the legal entity, or both and substantially all of the legal entity's activities either involve or are conducted on behalf of an investor with disproportionately few voting rights. Limited partnerships and other similar entities where unaffiliated limited partners have not been granted (i) substantive participatory rights or (ii) substantive rights to either dissolve the partnership or remove the general partner ("kick-out rights") are VIEs under condition (b) above. KKR's investment funds that are not CFEs (i) are generally limited partnerships, (ii) generally provide KKR with operational discretion and control, and (iii) generally have fund investors with no substantive rights to impact ongoing governance and operating activities of the fund, including the ability to remove the general partner, and, as such, the limited partners do not hold kick-out rights. Accordingly, most of KKR's investment funds are categorized as VIEs. KKR consolidates all VIEs in which it is the primary beneficiary. A reporting entity is determined to be the primary beneficiary if it holds a controlling financial interest in a VIE. A controlling financial interest is defined as (a) the power to direct the activities of a VIE that most significantly impact the VIE's economic performance and (b) the obligation to absorb losses of the VIE that could potentially be significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. The consolidation guidance requires an analysis to determine (i) whether an entity in which KKR holds a variable interest is a VIE and (ii) whether KKR's involvement, through holding interests directly or indirectly in the entity or contractually through other variable interests (for example, management and performance related fees), would give it a controlling financial interest. Performance of that analysis requires the exercise of judgment. Fees earned by KKR that are customary and commensurate with the level of effort required to provide those services, and where KKR does not hold other economic interests in the entity that would absorb more than an insignificant amount of the expected losses or returns of the entity, would not be considered variable interests. KKR factors in all economic interests including interests held through related parties, to determine if it holds a variable interest. KKR determines whether it is the primary beneficiary of a VIE at the time it becomes involved with a VIE and reconsiders that conclusion when facts and circumstances change. For entities that are determined not to be VIEs, these entities are generally considered VOEs and are evaluated under the voting interest model. KKR consolidates VOEs it controls through a majority voting interest or through other means. The consolidation assessment, including the determination as to whether an entity qualifies as a VIE or VOE depends on the facts and circumstances surrounding each entity and therefore certain of KKR's investment funds may qualify as VIEs whereas others may qualify as VOEs. With respect to CLOs (which are generally VIEs), in its role as collateral manager, KKR generally has the power to direct the activities of the CLO that most significantly impact the economic performance of the entity. In some, but not all cases, KKR, through its residual interest in the CLO may have variable interests that represent an obligation to absorb losses of, or a right to receive benefits from, the CLO that could potentially be significant to the CLO. In cases where KKR has both the power to direct the activities of the CLO that most significantly impact the CLO's economic performance and the obligation to absorb losses of the CLO or the right to receive benefits from the CLO that could potentially be significant to the CLO, KKR is deemed to be the primary beneficiary and consolidates the CLO. With respect to CMBS vehicles (which are generally VIEs), KKR holds unrated and non-investment grade rated securities issued by the CMBS, which are the most subordinate tranche of the CMBS vehicle. The economic performance of the CMBS is most significantly impacted by the performance of the underlying assets. Thus, the activities that most significantly impact the CMBS economic performance are the activities that most significantly impact the performance of the underlying assets. The special servicer has the ability to manage the CMBS assets that are delinquent or in default to improve the economic performance of the CMBS. KKR generally has the right to unilaterally appoint and remove the special servicer for the CMBS and as such is considered the controlling class of the CMBS vehicle. These rights give KKR the ability to direct the activities that most significantly impact the economic performance of the CMBS. Additionally, as the holder of the most subordinate tranche, KKR is in a first loss position and has the right to receive benefits, including the actual residual returns of the CMBS, if any. In these cases, KKR is deemed to be the primary beneficiary and consolidates the CMBS vehicle. Investments Investments consist primarily of private equity, real assets, credit, investments of consolidated CFEs, equity method, carried interest and other investments. Investments denominated in currencies other than the entity's functional currency are valued based on the spot rate of the respective currency at the end of the reporting period with changes related to exchange rate movements reflected as a component of Net Gains (Losses) from Investment Activities in the consolidated statements of operations. Security and loan transactions are recorded on a trade date basis. Further disclosure on investments is presented in Note 4 "Investments." The following describes the types of securities held within each investment class. Private Equity - Consists primarily of equity investments in operating businesses, including growth equity investments. Credit - Consists primarily of investments in below investment grade corporate debt securities (primarily high yield bonds and syndicated bank loans), originated, distressed and opportunistic debt, real estate mortgage loans, and interests in unconsolidated CLOs. Investments of Consolidated CFEs - Consists primarily of (i) investments in below investment grade corporate debt securities (primarily high yield bonds and syndicated bank loans) held directly by the consolidated CLOs and (ii) investments in originated, fixed-rate real estate mortgage loans held directly by the consolidated CMBS vehicles. Real Assets - Consists primarily of investments in (i) energy related assets, principally oil and natural gas producing properties, (ii) infrastructure assets, and (iii) real estate, principally residential and commercial real estate assets and businesses. Equity Method - Other - Consists primarily of (i) certain direct interests in operating companies in which KKR is deemed to exert significant influence under GAAP and (ii) certain interests in partnerships and joint ventures that hold private equity and real estate investments. Equity Method - Capital Allocation-Based Income - Consists primarily of (i) the capital interest KKR holds as the general partner in certain investment funds, which are not consolidated and (ii) the carried interest component of the general partner interest, which are accounted for as a single unit of account. Other - Consists primarily of investments in common stock, preferred stock, warrants and options of companies that are not private equity, real assets, credit or investments of consolidated CFEs. Investments held by Consolidated Investment Funds The consolidated investment funds are, for GAAP purposes, investment companies and reflect their investments and other financial instruments, including portfolio companies that are majority-owned and controlled by KKR's investment funds, at fair value. KKR has retained this specialized accounting for the consolidated funds in consolidation. Accordingly, the unrealized gains and losses resulting from changes in fair value of the investments and other financial instruments held by the consolidated investment funds are reflected as a component of Net Gains (Losses) from Investment Activities in the consolidated statements of operations. Certain energy investments are made through consolidated investment funds, including investments in working and royalty interests in oil and natural gas producing properties as well as investments in operating companies that operate in the energy industry. Since these investments are held through consolidated investment funds, such investments are reflected at fair value as of the end of the reporting period. Investments in operating companies that are held through KKR's consolidated investment funds are generally classified within private equity investments and investments in working and royalty interests in oil and natural gas producing properties are generally classified as real asset investments. Energy Investments held by KKR Certain energy investments are made by KKR in working and royalty interests in oil and natural gas producing properties and not through investment funds. Oil and natural gas producing activities are accounted for under the successful efforts method of accounting and such working interests are consolidated based on the proportion of the working interests held by KKR. Accordingly, KKR reflects its proportionate share of the underlying consolidated statements of financial condition and consolidated statements of operations of the consolidated working interests on a gross basis and changes in the value of these working interests are not reflected as unrealized gains and losses in the consolidated statements of operations. Under the successful efforts method, exploration costs, other than the costs of drilling exploratory wells, are charged to expense as incurred. Costs that are associated with the drilling of successful exploration wells are capitalized if proved reserves are found. Lease acquisition costs are capitalized when incurred. Costs associated with the drilling of exploratory wells that do not find proved reserves, geological and geophysical costs and costs of certain nonproducing leasehold costs are charged to expense as incurred. Expenditures for repairs and maintenance, including workovers, are charged to expense as incurred. The capitalized costs of producing oil and natural gas properties are depleted on a field-by-field basis using the units-of production method based on the ratio of current production to estimated total net proved oil, natural gas and natural gas liquid reserves. Proved developed reserves are used in computing depletion rates for drilling and development costs and total proved reserves are used for depletion rates of leasehold costs. Estimated dismantlement and abandonment costs for oil and natural gas properties, net of salvage value, are capitalized at their estimated net present value and amortized on a unit-of-production basis over the remaining life of the related proved developed reserves. Whenever events or changes in circumstances indicate that the carrying amounts of oil and natural gas properties may not be recoverable, KKR evaluates oil and natural gas properties and related equipment and facilities for impairment on a field-by-field basis. The determination of recoverability is made based upon estimated undiscounted future net cash flows. The amount of impairment loss, if any, is determined by comparing the fair value, as determined by a discounted cash flow analysis, with the carrying value of the related asset. Any impairment in value is recognized when incurred and is recorded in General, Administrative, and Other expense in the consolidated statements of operations. Fair Value Option For certain investments and other financial instruments, KKR has elected the fair value option. Such election is irrevocable and is applied on a financial instrument by financial instrument basis at initial recognition. KKR has elected the fair value option for certain private equity, real assets, credit, investments of consolidated CFEs, equity method - other and other financial instruments not held through a consolidated investment fund. Accounting for these investments at fair value is consistent with how KKR accounts for its investments held through consolidated investment funds. Changes in the fair value of such instruments are recognized in Net Gains (Losses) from Investment Activities in the consolidated statements of operations. Interest income on interest bearing credit securities on which the fair value option has been elected is based on stated coupon rates adjusted for the accretion of purchase discounts and the amortization of purchase premiums. This interest income is recorded within Interest Income in the consolidated statements of operations. Equity Method For certain investments in entities over which KKR exercises significant influence but which do not meet the requirements for consolidation and for which KKR has not elected the fair value option, KKR uses the equity method of accounting. The carrying value of equity method investments, for which KKR has not elected the fair value option, is determined based on the amounts invested by KKR, adjusted for the equity in earnings or losses of the investee allocated based on KKR's respective ownership percentage, less distributions. For equity method investments for which KKR has not elected the fair value option, KKR records its proportionate share of the investee's earnings or losses based on the most recently available financial information of the investee, which in certain cases may lag the date of KKR's financial statements by no more than three calendar months. As of March 31, 2019 , equity method investees for which KKR reports financial results on a lag include Marshall Wace LLP ("Marshall Wace"). KKR evaluates its equity method investments for which KKR has not elected the fair value option for impairment whenever events or changes in circumstances indicate that the carrying amounts of such investments may not be recoverable. The carrying value of investments classified as Equity Method - Capital Allocation-Based Income approximates fair value, because the underlying investments of the unconsolidated investment funds are reported at fair value. Financial Instruments held by Consolidated CFEs KKR measures both the financial assets and financial liabilities of the consolidated CFEs in its financial statements using the more observable of the fair value of the financial assets and the fair value of the financial liabilities which results in KKR's consolidated net income (loss) reflecting KKR's own economic interests in the consolidated CFEs including (i) changes in the fair value of the beneficial interests retained by KKR and (ii) beneficial interests that represent compensation for services rendered. For the consolidated CLOs, KKR has determined that the fair value of the financial assets of the consolidated CLOs is more observable than the fair value of the financial liabilities of the consolidated CLOs. As a result, the financial assets of the consolidated CLOs are being measured at fair value and the financial liabilities are being measured in consolidation as: (1) the sum of the fair value of the financial assets and the carrying value of any nonfinancial assets that are incidental to the operations of the CLOs less (2) the sum of the fair value of any beneficial interests retained by KKR (other than those that represent compensation for services) and KKR's carrying value of any beneficial interests that represent compensation for services. The resulting amount is allocated to the individual financial liabilities (other than the beneficial interests retained by KKR). For the consolidated CMBS vehicles, KKR has determined that the fair value of the financial liabilities of the consolidated CMBS vehicles is more observable than the fair value of the financial assets of the consolidated CMBS vehicles. As a result, the financial liabilities of the consolidated CMBS vehicles are being measured at fair value and the financial assets are being measured in consolidation as: (1) the sum of the fair value of the financial liabilities (other than the beneficial interests retained by KKR), the fair value of the beneficial interests retained by KKR and the carrying value of any nonfinancial liabilities that are incidental to the operations of the CMBS vehicles less (2) the carrying value of any nonfinancial assets that are incidental to the operations of the CMBS vehicles. The resulting amount is allocated to the individual financial assets. Fair Value Measurements Fair value is 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 under current market conditions. Except for certain of KKR's equity method investments (see "Equity Method" above) and debt obligations (as described in Note 10 "Debt Obligations"), KKR's investments and other financial instruments are recorded at fair value or at amounts whose carrying values approximate fair value. Where available, fair value is based on observable market prices or parameters or derived from such prices or parameters. Where observable prices or inputs are not available, valuation techniques are applied. These valuation techniques involve varying levels of management estimation and judgment, the degree of which is dependent on a variety of factors. GAAP establishes a hierarchical disclosure framework which prioritizes and ranks the level of market price observability used in measuring financial instruments at fair value. Market price observability is affected by a number of factors, including the type of financial instrument, the characteristics specific to the financial instrument and the state of the marketplace, including the existence and transparency of transactions between market participants. Financial instruments with readily available quoted prices in active markets generally will have a higher degree of market price observability and a lesser degree of judgment used in measuring fair value. Investments and financial instruments measured and reported at fair value are classified and disclosed based on the observability of inputs used in the determination of fair values, as follows: Level I - Pricing inputs are unadjusted, quoted prices in active markets for identical assets or liabilities as of the measurement date. The types of financial instruments included in this category are publicly-listed equities and securities sold short. Level II - Pricing inputs are other than quoted prices in active markets, which are either directly or indirectly observable as of the measurement date, and fair value is determined through the use of models or other valuation methodologies. The types of financial instruments included in this category are credit investments, investments and debt obligations of consolidated CLO entities, convertible debt securities indexed to publicly-listed securities, less liquid and restricted equity securities and certain over-the-counter derivatives such as foreign currency option and forward contracts. Level III - Pricing inputs are unobservable for the financial instruments and include situations where there is little, if any, market activity for the financial instrument. The inputs into the determination of fair value require significant management judgment or estimation. The types of financial instruments generally included in this category are private portfolio companies, real assets investments, credit investments, equity method investments for which the fair value option was elected and investments and debt obligations of consolidated CMBS entities. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the level in the fair value hierarchy within which the fair value measurement in its entirety falls has been determined based on the lowest level input that is significant to the fair value measurement in its entirety. KKR's assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and consideration of factors specific to the asset. A significant decrease in the volume and level of activity for the asset or liability is an indication that transactions or quoted prices may not be representative of fair value because in such market conditions there may be increased instances of transactions that are not orderly. In those circumstances, further analysis of transactions or quoted prices is needed, and a significant adjustment to the transactions or quoted prices may be necessary to estimate fair value. The availability of observable inputs can vary depending on the financial asset or liability and is affected by a wide variety of factors, including, for example, the type of instrument, whether the instrument has recently been issued, whether the instrument is traded on an active exchange or in the secondary market, and current market conditions. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by KKR in determining fair value is greatest for instruments categorized in Level III. The variability and availability of the observable inputs affected by the factors described above may cause transfers between Levels I, II, and III, which KKR recognizes at the beginning of the reporting period. Investments and other financial instruments that have readily observable market prices (such as those traded on a securities exchange) are stated at the last quoted sales price as of the reporting date. KKR does not adjust the quoted price for these investments, even in situations where KKR holds a large position and a sale could reasonably affect the quoted price. Management's determination of fair value is based upon the methodologies and processes described below and may incorporate assumptions that are management's best estimates after consideration of a variety of internal and external factors. Level II Valuation Methodologies Credit Investments: These instruments generally have bid and ask prices that can be observed in the marketplace. Bid prices reflect the highest price that KKR and others are willing to pay for an instrument. Ask prices represent the lowest price that KKR and others are willing to accept for an instrument. For financial assets and liabilities whose inputs are based on bid-ask prices obtained from third party pricing services, fair value may not always be a predetermined point in the bid-ask range. KKR's policy is generally to allow for mid-market pricing and adjusting to the point within the bid-ask range that meets KKR's best estimate of fair value. Investments and Debt Obligations of Consolidated CLO Vehicles: Investments of consolidated CLO vehicles are reported within Investments of Consolidated CFEs and are valued using the same valuation methodology as described above for credit investments. Under ASU 2014-13, KKR measures CLO debt obligations on the basis of the fair value of the financial assets of the CLO. Securities indexed to publicly-listed securities: The securities are typically valued using standard convertible security pricing models. The key inputs into these models that require some amount of judgment are the credit spreads utilized and the volatility assumed. To the extent the company being valued has other outstanding debt securities that are publicly-traded, the implied credit spread on the company's other outstanding debt securities would be utilized in the valuation. To the extent the company being valued does not have other outstanding debt securities that are publicly-traded, the credit spread will be estimated based on the implied credit spreads observed in comparable publicly-traded debt securities. In certain cases, an additional spread will be added to reflect an illiquidity discount due to the fact that the security being valued is not publicly-traded. The volatility assumption is based upon the historically observed volatility of the underlying equity security into which the convertible debt security is convertible and/or the volatility implied by the prices of options on the underlying equity security. Restricted Equity Securities: The valuation of certain equity securities is based on an observable price for an identical security adjusted for the effect of a restriction. Derivatives: The valuation incorporates observable inputs comprising yield curves, foreign currency rates and credit spreads. Level III Valuation Methodologies Investments and financial instruments categorized as Level III consist primarily of the following: Private Equity Investments: KKR generally employs two valuation methodologies when determining the fair value of a private equity investment. The first methodology is typically a market comparables analysis that considers key financial inputs and recent public and private transactions and other available measures. The second methodology utilized is typically a discounted cash flow analysis, which incorporates significant assumptions and judgments. Estimates of key inputs used in this methodology include the weighted average cost of capital for the investment and assumed inputs used to calculate terminal values, such as exit EBITDA multiples. In certain cases the results of the discounted cash flow approach can be significantly impacted by these estimates. Other inputs are also used in both methodologies. In addition, when a definitive agreement has been executed to sell an investment, KKR generally considers a significant determinant of fair value to be the consideration to be received by KKR pursuant to the executed definitive agreement. Upon completion of the valuations conducted using these methodologies, a weighting is ascribed to each method, and an illiquidity discount is typically applied where appropriate. The ultimate fair value recorded for a particular investment will generally be within a range suggested by the two methodologies, except that the value may be higher or lower than such range in the case of investments being sold pursuant to an executed definitive agreement. When determining the weighting ascribed to each valuation methodology, KKR considers, among other factors, the availability of direct market comparables, the applicability of a discounted cash flow analysis, the expected hold period and manner of realization for the investment, and in the case of investments being sold pursuant to an executed definitive agreement, an estimated probability of such sale being completed. These factors can result in different weightings among investments in the portfolio and in certain instances may result in up to a 100% weighting to a single methodology. When an illiquidity discount is to be applied, KKR seeks to take a uniform approach across its portfolio and generally applies a minimum 5% discount to all private equity investments. KKR then evaluates such private equity investments to determine if |
NET GAINS (LOSSES) FROM INVESTM
NET GAINS (LOSSES) FROM INVESTMENT ACTIVITIES | 3 Months Ended |
Mar. 31, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |
NET GAINS (LOSSES) FROM INVESTMENT ACTIVITIES | NET GAINS (LOSSES) FROM INVESTMENT ACTIVITIES Net Gains (Losses) from Investment Activities in the consolidated statements of operations consist primarily of the realized and unrealized gains and losses on investments (including foreign exchange gains and losses attributable to foreign denominated investments and related activities) and other financial instruments, including those for which the fair value option has been elected. Unrealized gains or losses result from changes in the fair value of these investments and other financial instruments during a period. Upon disposition of an investment or financial instrument, previously recognized unrealized gains or losses are reversed and an offsetting realized gain or loss is recognized in the current period. The following table summarizes total Net Gains (Losses) from Investment Activities: Three Months Ended Three Months Ended Net Realized Net Unrealized Total Net Realized Net Unrealized Total Private Equity (1) $ 68,568 $ 919,625 $ 988,193 $ 16,253 $ 158,369 $ 174,622 Credit (1) (17,876 ) 8,669 (9,207 ) 1,263 58,150 59,413 Investments of Consolidated CFEs (1) (10,530 ) 233,357 222,827 (26,516 ) (48,403 ) (74,919 ) Real Assets (1) 29,547 89,581 119,128 12,957 59,297 72,254 Equity Method - Other (1) 20,133 156,906 177,039 9,210 135,604 144,814 Other Investments (1) 1,450 (30,361 ) (28,911 ) (244,199 ) 86,365 (157,834 ) Foreign Exchange Forward Contracts and Options (2) 25,454 54,789 80,243 (32,614 ) (63,118 ) (95,732 ) Securities Sold Short (2) 14,426 (80,772 ) (66,346 ) 275,949 (29,874 ) 246,075 Other Derivatives (2) 1,465 (13,405 ) (11,940 ) 3,642 (8,223 ) (4,581 ) Debt Obligations and Other (3) (2,856 ) (264,292 ) (267,148 ) 14,435 94,253 108,688 Net Gains (Losses) From Investment Activities $ 129,781 $ 1,074,097 $ 1,203,878 $ 30,380 $ 442,420 $ 472,800 (1) See Note 4 "Investments." (2) See Note 8 "Other Assets and Accounts Payable, Accrued Expenses and Other Liabilities." (3) See Note 10 "Debt Obligations." |
INVESTMENTS
INVESTMENTS | 3 Months Ended |
Mar. 31, 2019 | |
Investments [Abstract] | |
INVESTMENTS | INVESTMENTS Investments consist of the following: March 31, 2019 December 31, 2018 Private Equity $ 8,522,282 $ 7,349,559 Credit 7,649,787 9,099,135 Investments of Consolidated CFEs 15,021,345 14,733,423 Real Assets 3,213,813 3,157,954 Equity Method - Other 4,472,692 4,212,874 Equity Method - Capital Allocation-Based Income 4,203,980 3,584,415 Other Investments 2,711,355 2,770,622 Total Investments $ 45,795,254 $ 44,907,982 As of March 31, 2019 and December 31, 2018, there were no investments which represented greater than 5% of total investments. The majority of the securities underlying private equity investments represent equity securities. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 3 Months Ended |
Mar. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS The following tables summarize the valuation of assets and liabilities measured and reported at fair value by the fair value hierarchy. Investments classified as Equity Method - Other, for which the fair value option has not been elected, and Equity Method - Capital Allocation-Based Income have been excluded from the tables below. Assets, at fair value: March 31, 2019 Level I Level II Level III Total Private Equity $ 1,603,803 $ 86,933 $ 6,831,546 $ 8,522,282 Credit — 1,119,308 6,530,479 7,649,787 Investments of Consolidated CFEs — 12,937,610 2,083,735 15,021,345 Real Assets — — 3,213,813 3,213,813 Equity Method - Other 219,566 47,938 1,650,179 1,917,683 Other Investments 501,523 145,882 2,063,950 2,711,355 Total Investments 2,324,892 14,337,671 22,373,702 39,036,265 Foreign Exchange Contracts and Options — 205,900 — 205,900 Other Derivatives — 1,786 31,134 (1) 32,920 Total Assets $ 2,324,892 $ 14,545,357 $ 22,404,836 $ 39,275,085 December 31, 2018 Level I Level II Level III Total Private Equity $ 1,156,977 $ 63,999 $ 6,128,583 $ 7,349,559 Credit — 2,334,405 6,764,730 9,099,135 Investments of Consolidated CFEs — 12,650,878 2,082,545 14,733,423 Real Assets — — 3,157,954 3,157,954 Equity Method - Other 245,225 43,943 1,503,022 1,792,190 Other Investments 480,192 173,844 2,116,586 2,770,622 Total Investments 1,882,394 15,267,069 21,753,420 38,902,883 Foreign Exchange Contracts and Options — 177,264 — 177,264 Other Derivatives — 3,879 37,116 (1) 40,995 Total Assets $ 1,882,394 $ 15,448,212 $ 21,790,536 $ 39,121,142 (1) Includes derivative assets that were valued using a third-party valuation firm. The approach used to estimate the fair value of these derivative assets was generally the discounted cash flow method, which includes consideration of the current portfolio, projected portfolio construction, projected portfolio realizations, portfolio volatility (based on the volatility, correlation, and size of each underlying asset class), and the discounting of future cash flows to the reporting date. Liabilities, at fair value: March 31, 2019 Level I Level II Level III Total Securities Sold Short $ 582,608 $ — $ — $ 582,608 Foreign Exchange Contracts and Options — 17,200 — 17,200 Unfunded Revolver Commitments — — 56,792 (1) 56,792 Other Derivatives — 23,769 17,200 (2) 40,969 Debt Obligations of Consolidated CFEs — 12,557,821 1,914,571 14,472,392 Total Liabilities $ 582,608 $ 12,598,790 $ 1,988,563 $ 15,169,961 December 31, 2018 Level I Level II Level III Total Securities Sold Short $ 344,124 $ — $ — $ 344,124 Foreign Exchange Contracts and Options — 60,749 — 60,749 Unfunded Revolver Commitments — — 52,066 (1) 52,066 Other Derivatives — 18,440 17,200 (2) 35,640 Debt Obligations of Consolidated CFEs — 12,081,771 1,876,783 13,958,554 Total Liabilities $ 344,124 $ 12,160,960 $ 1,946,049 $ 14,451,133 (1) These unfunded revolver commitments are classified as Level III within the fair value hierarchy and valued using the same valuation methodologies as KKR's Level III credit investments. (2) Includes options issued in connection with the acquisition of the equity interest in Marshall Wace and its affiliates in November 2015 to increase KKR's ownership interest in periodic increments. The options are valued using a Monte-Carlo simulation valuation methodology. Key inputs used in this methodology that require estimates include Marshall Wace's dividend yield, assets under management volatility and equity volatility. See Note 4 "Investments." The following tables summarize changes in investments and debt obligations measured and reported at fair value for which Level III inputs have been used to determine fair value for the three months ended March 31, 2019 and 2018, respectively: For the Three Months Ended March 31, 2019 Level III Investments Level III Debt Obligations Private Equity Credit Investments of Consolidated CFEs Real Assets Equity Method - Other Other Investments Total Debt Obligations of Consolidated CFEs Balance, Beg. of Period $ 6,128,583 $ 6,764,730 $ 2,082,545 $ 3,157,954 $ 1,503,022 $ 2,116,586 $ 21,753,420 $ 1,876,783 Transfers In / (Out) Due to Changes in Consolidation — (1,598 ) — — — (42,864 ) (44,462 ) — Transfers In — — — — — — — — Transfers Out (56,029 ) — — — — — (56,029 ) — Asset Purchases / Debt Issuances 409,621 811,957 — 67,302 137,909 95,135 1,521,924 — Sales / Paydowns (99,603 ) (1,028,063 ) (38,295 ) (130,571 ) (41,126 ) (27,433 ) (1,365,091 ) — Settlements — 20,815 — — — — 20,815 (2,731 ) Net Realized Gains (Losses) 68,568 (15,198 ) — 29,547 11,626 2,121 96,664 — Net Unrealized Gains (Losses) 380,406 (24,806 ) 39,485 89,581 38,748 (79,595 ) 443,819 40,519 Change in Other Comprehensive Income — 2,642 — — — — 2,642 — Balance, End of Period $ 6,831,546 $ 6,530,479 $ 2,083,735 $ 3,213,813 $ 1,650,179 $ 2,063,950 $ 22,373,702 $ 1,914,571 Changes in Net Unrealized Gains (Losses) Included in Net Gains (Losses) from Investment Activities related to Level III Assets and Liabilities still held as of the Reporting Date $ 442,672 $ (31,282 ) $ 39,485 $ 92,900 $ 49,140 $ (79,347 ) $ 513,568 $ 40,519 For the Three Months Ended March 31, 2018 Level III Investments Level III Private Equity Credit Investments of Consolidated CFEs Real Assets Equity Method - Other Other Investments Total Debt Obligations of Consolidated CFEs Balance, Beg. of Period $ 2,172,290 $ 5,138,937 $ 5,353,090 $ 2,251,267 $ 1,076,709 $ 1,760,011 $ 17,752,304 $ 5,238,236 Transfers In / (Out) Due to Changes in Consolidation — — — — — — — — Transfers In — — — — — — — — Transfers Out — — — — — — — — Asset Purchases / Debt Issuances 727,626 890,113 — 540,898 2,037 64,757 2,225,431 — Sales / Paydowns (35,245 ) (230,144 ) (11,541 ) (34,237 ) (31,939 ) (36,218 ) (379,324 ) — Settlements — (53,825 ) — — — — (53,825 ) (11,541 ) Net Realized Gains (Losses) 15,312 11,581 — 8,354 9,348 8,892 53,487 — Net Unrealized Gains (Losses) 208,428 77,715 (83,150 ) 61,151 29,570 3,762 297,476 (88,528 ) Change in Other Comprehensive Income — (15,522 ) — — — — (15,522 ) — Balance, End of Period $ 3,088,411 $ 5,818,855 $ 5,258,399 $ 2,827,433 $ 1,085,725 $ 1,801,204 $ 19,880,027 $ 5,138,167 Changes in Net Unrealized Gains (Losses) Included in Net Gains (Losses) from Investment Activities related to Level III Assets and Liabilities still held as of the Reporting Date $ 208,428 $ 86,754 $ (83,150 ) $ 61,151 $ 34,928 $ 10,442 $ 318,553 $ (88,528 ) Total realized and unrealized gains and losses recorded for Level III assets and liabilities are reported in Net Gains (Losses) from Investment Activities in the accompanying consolidated statements of operations. The following table presents additional information about valuation methodologies and significant unobservable inputs used for investments and debt obligations that are measured and reported at fair value and categorized within Level III as of March 31, 2019 : Fair Value March 31, 2019 Valuation Methodologies Unobservable Input(s) (1) Weighted Average (2) Range Impact to Valuation from an Increase in Input (3) Private Equity $ 6,831,546 Private Equity $ 4,322,213 Inputs to market comparables and discounted cash flow and transaction price Illiquidity Discount 6.1% 5.0% - 15.0% Decrease Weight Ascribed to Market Comparables 30.5% 0.0% - 50.0% (4) Weight Ascribed to Discounted Cash Flow 69.4% 0.0% - 100.0% (5) Weight Ascribed to Transaction Price 0.1% 0.0% - 100.0% (6) Market comparables Enterprise Value/LTM EBITDA Multiple 14.2x 6.9x - 23.7x Increase Enterprise Value/Forward EBITDA Multiple 12.4x 6.2x - 17.2x Increase Discounted cash flow Weighted Average Cost of Capital 10.7% 5.6% - 14.6% Decrease Enterprise Value/LTM EBITDA Exit Multiple 12.4x 6.0x - 15.0x Increase Growth Equity $ 2,509,333 Inputs to market comparables, discounted cash flow and milestones Illiquidity Discount 11.6% 5.0% - 20.0% Decrease Weight Ascribed to Market Comparables 35.2% 0.0% - 100.0% (4) Weight Ascribed to Discounted Cash Flow 15.3% 0.0% - 75.0% (5) Weight Ascribed to Milestones 49.5% 0.0% - 100.0% (6) Scenario Weighting Base 61.4% 40.0% - 80.0% Increase Downside 16.0% 5.0% - 30.0% Decrease Upside 22.6% 10.0% - 45.0% Increase Credit $ 6,530,479 Yield Analysis Yield 7.6% 3.5% - 23.4% Decrease Net Leverage 2.1x 0.2x - 14.1x Decrease EBITDA Multiple 9.7x 0.2x - 38.2x Increase Investments of Consolidated CFEs $ 2,083,735 (9) Debt Obligations of Consolidated CFEs $ 1,914,571 Discounted cash flow Yield 5.8% 2.6% - 15.5% Decrease Real Assets $ 3,213,813 (10) Energy $ 1,711,998 Discounted cash flow Weighted Average Cost of Capital 10.6% 9.5% - 14.1% Decrease Average Price Per BOE (8) $44.62 $38.98 - $47.75 Increase Real Estate $ 1,294,181 Inputs to direct income capitalization and discounted cash flow Weight Ascribed to Direct Income Capitalization 32.2% 0.0% - 100.0% (7) Weight Ascribed to Discounted Cash Flow 67.8% 0.0% - 100.0% (5) Direct income capitalization Current Capitalization Rate 5.9% 0.4% - 9.5% Decrease Discounted cash flow Unlevered Discount Rate 8.0% 4.8% - 18.0% Decrease Equity Method - Other $ 1,650,179 Inputs to market comparables, discounted cash flow and transaction price Illiquidity Discount 9.5% 5.0% - 15.0% Decrease Weight Ascribed to Market Comparables 42.6% 0.0% - 75.0% (4) Weight Ascribed to Discounted Cash Flow 39.4% 0.0% - 100.0% (5) Weight Ascribed to Transaction Price 18.0% 0.0% - 100.0% (6) Market comparables Enterprise Value/LTM EBITDA Multiple 12.0x 6.9x - 15.2x Increase Enterprise Value/Forward EBITDA Multiple 11.2x 6.2x - 13.2x Increase Discounted cash flow Weighted Average Cost of Capital 9.0% 5.6% - 13.0% Decrease Enterprise Value/LTM EBITDA Exit Multiple 10.4x 6.0x - 12.5x Increase Fair Value March 31, 2019 Valuation Methodologies Unobservable Input(s) (1) Weighted Average (2) Range Impact to Valuation from an Increase in Input (3) Other Investments $ 2,063,950 (11) Inputs to market comparables, discounted cash flow and transaction price Illiquidity Discount 10.2% 5.0% - 20.0% Decrease Weight Ascribed to Market Comparables 38.1% 0.0% - 100.0% (4) Weight Ascribed to Discounted Cash Flow 36.1% 0.0% - 100.0% (5) Weight Ascribed to Transaction Price 25.8% 0.0% - 100.0% (6) Market comparables Enterprise Value/LTM EBITDA Multiple 10.3x 1.3x - 14.6x Increase Enterprise Value/Forward EBITDA Multiple 9.1x 1.2x - 11.7x Increase Discounted cash flow Weighted Average Cost of Capital 17.2% 7.3% - 31.1% Decrease Enterprise Value/LTM EBITDA Exit Multiple 8.9x 6.5x - 9.1x Increase (1) In determining certain of these inputs, management evaluates a variety of factors including economic conditions, industry and market developments, market valuations of comparable companies and company specific developments including exit strategies and realization opportunities. Management has determined that market participants would take these inputs into account when valuing the investments and debt obligations. LTM means last twelve months and EBITDA means earnings before interest, taxes, depreciation and amortization. (2) Inputs were weighted based on the fair value of the investments included in the range. (3) Unless otherwise noted, this column represents the directional change in the fair value of the Level III investments that would result from an increase to the corresponding unobservable input. A decrease to the unobservable input would have the opposite effect. Significant increases and decreases in these inputs in isolation could result in significantly higher or lower fair value measurements. (4) The directional change from an increase in the weight ascribed to the market comparables approach would increase the fair value of the Level III investments if the market comparables approach results in a higher valuation than the discounted cash flow approach and transaction price. The opposite would be true if the market comparables approach results in a lower valuation than the discounted cash flow approach and transaction price. (5) The directional change from an increase in the weight ascribed to the discounted cash flow approach would increase the fair value of the Level III investments if the discounted cash flow approach results in a higher valuation than the market comparables approach, transaction price and direct income capitalization approach. The opposite would be true if the discounted cash flow approach results in a lower valuation than the market comparables approach, transaction price and direct income capitalization approach. (6) The directional change from an increase in the weight ascribed to the transaction price or milestones would increase the fair value of the Level III investments if the transaction price or milestones results in a higher valuation than the market comparables and discounted cash flow approach. The opposite would be true if the transaction price or milestones results in a lower valuation than the market comparables approach and discounted cash flow approach. (7) The directional change from an increase in the weight ascribed to the direct income capitalization approach would increase the fair value of the Level III investments if the direct income capitalization approach results in a higher valuation than the discounted cash flow approach. The opposite would be true if the direct income capitalization approach results in a lower valuation than the discounted cash flow approach. (8) The total energy fair value amount includes multiple investments (in multiple locations throughout North America) that are held in multiple investment funds and produce varying quantities of oil, condensate, natural gas liquids, and natural gas. Commodity price may be measured using a common volumetric equivalent where one barrel of oil equivalent ("BOE"), is determined using the ratio of six thousand cubic feet of natural gas to one barrel of oil, condensate or natural gas liquids. The price per BOE is provided to show the aggregate of all price inputs for the various investments over a common volumetric equivalent although the valuations for specific investments may use price inputs specific to the asset for purposes of our valuations. The discounted cash flows include forecasted production of liquids (oil, condensate, and natural gas liquids) and natural gas with a forecasted revenue ratio of approximately 88% liquids and 12% natural gas. (9) KKR measures CMBS investments on the basis of the fair value of the financial liabilities of the CMBS vehicle. See Note 2 "Summary of Significant Accounting Policies." (10) Includes one Infrastructure investment for $207.6 million that was valued using a discounted cash flow analysis. The significant inputs used included the weighted average cost of capital 6.8% and the enterprise value/LTM EBITDA Exit Multiple 10.0 x. (11) Consists primarily of investments in common stock, preferred stock, warrants and options of companies that are not private equity, real assets, credit, equity method - other or investments of consolidated CFEs. In the table above, certain private equity investments may be valued at cost for a period of time after an acquisition as the best indicator of fair value. In addition, certain valuations of private equity investments may be entirely or partially derived by reference to observable valuation measures for a pending or consummated transaction. The various unobservable inputs used to determine the Level III valuations may have similar or diverging impacts on valuation. Significant increases and decreases in these inputs in isolation and interrelationships between those inputs could result in significantly higher or lower fair value measurements as noted in the table above. |
FAIR VALUE OPTION
FAIR VALUE OPTION | 3 Months Ended |
Mar. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE OPTION | FAIR VALUE OPTION The following table summarizes the financial instruments for which the fair value option has been elected: March 31, 2019 December 31, 2018 Assets Private Equity $ 3,235 $ 2,977 Credit 4,519,000 4,950,819 Investments of Consolidated CFEs 15,021,345 14,733,423 Real Assets 309,105 310,399 Equity Method - Other 1,917,683 1,792,190 Other Investments 225,867 235,012 Total $ 21,996,235 $ 22,024,820 Liabilities Debt Obligations of Consolidated CFEs $ 14,472,392 $ 13,958,554 Total $ 14,472,392 $ 13,958,554 The following table presents the net realized and net unrealized gains (losses) on financial instruments for which the fair value option was elected: Three Months Ended Three Months Ended Net Realized Net Unrealized Gains (Losses) Total Net Realized Net Unrealized Gains (Losses) Total Assets Private Equity $ — $ 194 $ 194 $ 71 $ 316 $ 387 Credit (23,153 ) 20,942 (2,211 ) (28,867 ) 2,656 (26,211 ) Investments of Consolidated CFEs (10,530 ) 233,357 222,827 (26,516 ) (48,403 ) (74,919 ) Real Assets 703 2,436 3,139 428 (3,483 ) (3,055 ) Equity Method - Other 11,626 17,084 28,710 9,348 66,093 75,441 Other Investments 1,794 3,987 5,781 4,607 (7,878 ) (3,271 ) Total $ (19,560 ) $ 278,000 $ 258,440 $ (40,929 ) $ 9,301 $ (31,628 ) Liabilities Debt Obligations of Consolidated CFEs — (252,281 ) (252,281 ) 13,256 93,654 106,910 Total $ — $ (252,281 ) $ (252,281 ) $ 13,256 $ 93,654 $ 106,910 |
NET INCOME (LOSS) ATTRIBUTABLE
NET INCOME (LOSS) ATTRIBUTABLE TO KKR & CO. INC. PER SHARE OF CLASS A COMMON STOCK | 3 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
NET INCOME (LOSS) ATTRIBUTABLE TO KKR & CO. INC. PER SHARE OF CLASS A COMMON STOCK | NET INCOME (LOSS) ATTRIBUTABLE TO KKR & CO. INC. PER SHARE OF CLASS A COMMON STOCK For the three months ended March 31, 2019 and 2018 , basic and diluted Net Income (Loss) attributable to KKR & Co. Inc. per share of Class A common stock were calculated as follows: Three Months Ended March 31, 2019 2018 Net Income (Loss) Attributable to KKR & Co. Inc. Class A Common Stockholders $ 700,978 $ 170,102 Excess of carrying value over consideration transferred on redemption of KFN 7.375% Series A LLC Preferred Shares — 3,102 Net Income (Loss) Available to KKR & Co. Inc. Class A Common Stockholders $ 700,978 $ 173,204 Basic Net Income (Loss) Per Share of Class A Common Stock Weighted Average Shares of Class A Common Stock Outstanding - Basic 533,892,474 487,704,838 Net Income (Loss) Attributable to KKR & Co. Inc. Per Share of Class A Common Stock - Basic $ 1.31 $ 0.36 Diluted Net Income (Loss) Per Share of Class A Common Stock Weighted Average Shares of Class A Common Stock Outstanding - Basic 533,892,474 487,704,838 Weighted Average Unvested Shares of Class A Common Stock and Other Exchangeable Securities 16,153,966 48,213,436 Weighted Average Shares of Class A Common Stock Outstanding - Diluted 550,046,440 535,918,274 Net Income (Loss) Attributable to KKR & Co. Inc. Per Share of Class A Common Stock - Diluted $ 1.27 $ 0.32 Weighted Average Shares of Class A Common Stock Outstanding - Diluted primarily includes unvested equity awards that have been granted under the Amended and Restated KKR & Co. Inc. 2010 Equity Incentive Plan (the "2010 Equity Incentive Plan" and, together with the KKR & Co. Inc. 2019 Equity Incentive Plan (the "2019 Equity Incentive Plan"), the "Equity Incentive Plans"), as well as exchangeable equity securities issued in connection with the acquisition of Avoca. Vesting or exchanges of these equity interests dilute KKR & Co. Inc. and KKR Holdings pro rata in accordance with their respective ownership interests in the KKR Group Partnerships. For the three months ended March 31, 2019 and 2018 , KKR Holdings units have been excluded from the calculation of Net Income (Loss) Attributable to KKR & Co. Inc. Per Share of Class A Common Stock - Diluted since the exchange of these units would not dilute KKR's respective ownership interests in the KKR Group Partnerships. Three Months Ended March 31, 2019 2018 Weighted Average KKR Holdings Units 298,858,418 335,016,218 Additionally, for the three months ended March 31, 2019 , 5.0 million shares of KKR Class A common stock subject to a market price-based vesting condition were excluded from the calculation of Net Income (Loss) Attributable to KKR & Co. Inc. Per Share of Class A Common Stock - Diluted since the vesting conditions have not been satisfied. See Note 12 "Equity Based Compensation." |
OTHER ASSETS AND ACCOUNTS PAYAB
OTHER ASSETS AND ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER LIABILITIES | 3 Months Ended |
Mar. 31, 2019 | |
OTHER ASSETS AND ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER LIABILITIES | |
OTHER ASSETS AND ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER LIABILITIES | OTHER ASSETS AND ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER LIABILITIES Other Assets consist of the following: March 31, 2019 December 31, 2018 Unsettled Investment Sales (1) $ 129,141 $ 101,789 Receivables 64,802 27,258 Due from Broker (2) 485,127 396,512 Oil & Gas Assets, net (3) 210,865 225,256 Deferred Tax Assets, net 408,148 538,161 Interest Receivable 231,445 241,547 Fixed Assets, net (4) 466,264 451,206 Foreign Exchange Contracts and Options (5) 205,900 177,264 Intangible Assets, net (6) 9,125 9,863 Goodwill (7) 83,500 83,500 Derivative Assets 32,920 40,995 Deposits 7,284 7,299 Prepaid Taxes 73,054 69,165 Prepaid Expenses 27,106 23,551 Operating Lease Right of Use Assets (8) 146,165 — Deferred Financing Costs 13,458 13,871 Other 93,498 129,455 Total $ 2,687,802 $ 2,536,692 (1) Represents amounts due from third parties for investments sold for which cash settlement has not occurred. (2) Represents amounts held at clearing brokers resulting from securities transactions. (3) Includes proved and unproved oil and natural gas properties under the successful efforts method of accounting, which is net of impairment write-downs, accumulated depreciation, depletion and amortization. Depreciation, depletion and amortization amounted to $13.8 million and $7.1 million for the three months ended March 31, 2019 and 2018, respectively. (4) Net of accumulated depreciation and amortization of $118.0 million and $113.5 million as of March 31, 2019 and December 31, 2018, respectively. Depreciation and amortization expense of $4.4 million and $3.7 million for the three months ended March 31, 2019 and 2018, respectively, is included in General, Administrative and Other in the accompanying consolidated statements of operations. (5) Represents derivative financial instruments used to manage foreign exchange risk arising from certain foreign currency denominated investments. Such instruments are measured at fair value with changes in fair value recorded in Net Gains (Losses) from Investment Activities in the accompanying consolidated statements of operations. See Note 3 "Net Gains (Losses) from Investment Activities" for the net changes in fair value associated with these instruments. (6) Net of accumulated amortization of $63.5 million as of March 31, 2019 and December 31, 2018. Amortization expense of $0.5 million and $5.0 million for the three months ended March 31, 2019 and 2018, respectively, is included in General, Administrative and Other in the accompanying consolidated statements of operations. (7) As of March 31, 2019 , the carrying value of goodwill is recorded and assessed for impairment at the reporting unit. (8) KKR’s non-cancelable operating leases consist of leases for office space around the world. KKR is the lessee under the terms of the operating leases. For the three months ended March 31, 2019, the operating lease cost was $11.8 million . Accounts Payable, Accrued Expenses and Other Liabilities consist of the following: March 31, 2019 December 31, 2018 Amounts Payable to Carry Pool (1) $ 1,089,045 $ 922,977 Unsettled Investment Purchases (2) 507,731 541,165 Securities Sold Short (3) 582,608 344,124 Derivative Liabilities 40,969 35,640 Accrued Compensation and Benefits 166,294 107,887 Interest Payable 216,348 212,969 Foreign Exchange Contracts and Options (4) 17,200 60,749 Accounts Payable and Accrued Expenses 108,170 130,554 Taxes Payable 55,355 24,453 Uncertain Tax Positions 67,374 66,775 Unfunded Revolver Commitments 56,792 52,066 Operating Lease Liabilities (5) 152,073 — Other Liabilities 219,069 244,631 Total $ 3,279,028 $ 2,743,990 (1) Represents the amount of carried interest payable to principals, professionals and other individuals with respect to KKR's active funds and co-investment vehicles that provide for carried interest. (2) Represents amounts owed to third parties for investment purchases for which cash settlement has not occurred. (3) Represents the obligations of KKR to deliver a specified security at a future point in time. Such securities are measured at fair value with changes in fair value recorded in Net Gains (Losses) from Investment Activities in the accompanying consolidated statements of operations. See Note 3 "Net Gains (Losses) from Investment Activities" for the net changes in fair value associated with these instruments. (4) Represents derivative financial instruments used to manage foreign exchange risk arising from certain foreign currency denominated investments. Such instruments are measured at fair value with changes in fair value recorded in Net Gains (Losses) from Investment Activities in the accompanying consolidated statements of operations. See Note 3 "Net Gains (Losses) from Investment Activities" for the net changes in fair value associated with these instruments. (5) KKR’s operating leases have remaining lease terms that range from one year to 14 years, some of which include options to extend the leases for up to three years. For the three months ended March 31, 2019 , the weighted average remaining lease term and weighted average discount rate were 4.78 years and 2.64% , respectively. |
VARIABLE INTEREST ENTITIES
VARIABLE INTEREST ENTITIES | 3 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
VARIABLE INTEREST ENTITIES | VARIABLE INTEREST ENTITIES Consolidated VIEs KKR consolidates certain VIEs in which it is determined that KKR is the primary beneficiary as described in Note 2 "Summary of Significant Accounting Policies" and which are predominately CFEs and certain investment funds. The primary purpose of these VIEs is to provide strategy specific investment opportunities to earn investment gains, current income or both in exchange for management and performance based fees or carried interest. KKR's investment strategies for these VIEs differ by product; however, the fundamental risks have similar characteristics, including loss of invested capital and loss of management and performance based fees or carried interest. KKR does not provide performance guarantees and has no other financial obligation to provide funding to these consolidated VIEs, beyond amounts previously committed, if any. Unconsolidated VIEs KKR holds variable interests in certain VIEs which are not consolidated as it has been determined that KKR is not the primary beneficiary. VIEs that are not consolidated predominantly include certain investment funds sponsored by KKR. KKR's investment strategies differ by investment fund; however, the fundamental risks have similar characteristics, including loss of invested capital and loss of management and performance based fees or carried interest. KKR's maximum exposure to loss as a result of its investments in the unconsolidated investment funds is the carrying value of such investments, including KKR's capital interest and any unrealized carried interest. Accordingly, disaggregation of KKR's involvement by type of unconsolidated investment fund would not provide more useful information. For these unconsolidated investment funds in which KKR is the sponsor, KKR may have an obligation as general partner to provide commitments to such investment funds. As of March 31, 2019 , KKR's commitments to these unconsolidated investment funds was $2.3 billion . KKR has not provided any financial support other than its obligated amount as of March 31, 2019 . As of March 31, 2019 and December 31, 2018, the maximum exposure to loss, before allocations to the carry pool and noncontrolling interests, if any, for those VIEs in which KKR is determined not to be the primary beneficiary but in which it has a variable interest is as follows: March 31, 2019 December 31, 2018 Investments $ 4,203,980 $ 3,610,502 Due from (to) Affiliates, net 490,990 410,489 Maximum Exposure to Loss $ 4,694,970 $ 4,020,991 |
DEBT OBLIGATIONS
DEBT OBLIGATIONS | 3 Months Ended |
Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
DEBT OBLIGATIONS | DEBT OBLIGATIONS KKR enters into credit agreements and issues debt for its general operating and investment purposes. KKR consolidates and reports debt obligations of KKR Financial Holdings LLC ("KFN"), which are non-recourse to KKR beyond the assets of KFN. Certain of KKR's consolidated investment funds borrow to meet financing needs of their operating and investing activities. Fund financing facilities have been established for the benefit of certain investment funds. When an investment fund borrows from the facility in which it participates, the proceeds from the borrowings are limited for their intended use by the borrowing investment fund. KKR's obligations with respect to these financing arrangements are generally limited to KKR's pro rata equity interest in such investment funds. In certain other cases, KKR has majority-owned investment vehicles that make investments and purchase other assets with borrowings that are collateralized only by the investments and assets they own. In addition, consolidated CFE vehicles issue debt securities to third-party investors which are collateralized by assets held by the CFE vehicle. Debt securities issued by CFEs are supported solely by the assets held at the CFEs and are not collateralized by assets of any other KKR entity. CFEs also may have warehouse facilities with banks to provide liquidity to the CFE. The CFE's debt obligations are non-recourse to KKR beyond the assets of the CFE. KKR's borrowings consisted of the following: March 31, 2019 December 31, 2018 Financing Available Borrowing Outstanding Fair Value Financing Available Borrowing Outstanding Fair Value Revolving Credit Facilities: Corporate Credit Agreement $ 1,000,000 $ — $ — $ 1,000,000 $ — $ — KCM Credit Agreement 434,395 — — 451,338 — — KCM Short-Term Credit Agreement 750,000 — — 750,000 — — Notes Issued: KKR Issued 6.375% Notes Due 2020 (1) — 499,122 523,900 (14) — 498,975 523,500 (14) KKR Issued 5.500% Notes Due 2043 (2) — 491,921 537,235 (14) — 491,836 508,615 (14) KKR Issued 5.125% Notes Due 2044 (3) — 990,831 1,030,140 (14) — 990,740 974,320 (14) KKR Issued 0.509% Notes Due 2023 (4) — 224,386 223,695 (14) — 226,895 227,298 (14) KKR Issued 0.764% Notes Due 2025 (5) — 44,435 45,402 (14) — 44,923 45,161 (14) KKR Issued 1.595% Notes Due 2038 (6) — 91,767 96,510 (14) — 92,817 94,568 (14) KFN Issued 5.500% Notes Due 2032 (7) — 493,689 502,524 — 493,568 496,359 KFN Issued 5.200% Notes Due 2033 (8) — 118,321 117,152 — 118,291 115,582 KFN Issued 5.400% Notes Due 2033 (9) — 68,705 69,689 — 68,683 68,780 KFN Issued Junior Subordinated Notes (10) — 232,471 197,478 — 232,142 203,135 Other Debt Obligations: Financing Facilities of Consolidated Funds and Other (11) 4,216,970 4,534,329 4,534,329 3,840,877 5,123,768 5,123,768 CLO Senior Secured Notes (12) — 12,155,621 12,155,621 — 11,667,970 11,667,970 CLO Subordinated Notes (12) — 402,200 402,200 — 413,801 413,801 CMBS Debt Obligations (13) — 1,914,571 1,914,571 — 1,876,783 1,876,783 $ 6,401,365 $ 22,262,369 $ 22,350,446 $ 6,042,215 $ 22,341,192 $ 22,339,640 (1) $500 million aggregate principal amount of 6.375% senior notes of KKR due 2020. Borrowing outstanding is presented net of (i) unamortized note discount and (ii) unamortized debt issuance costs of $0.6 million and $0.7 million as of March 31, 2019 and December 31, 2018 , respectively. (2) $500 million aggregate principal amount of 5.500% senior notes of KKR due 2043. Borrowing outstanding is presented net of (i) unamortized note discount and (ii) unamortized debt issuance costs of $3.5 million and $3.6 million as of March 31, 2019 and December 31, 2018 , respectively. (3) $1.0 billion aggregate principal amount of 5.125% senior notes of KKR due 2044. Borrowing outstanding is presented net of (i) unamortized note discount (net of premium) and (ii) unamortized debt issuance costs of $7.9 million and $8.0 million as of March 31, 2019 and December 31, 2018 , respectively. (4) ¥25 billion (or $225.6 million ) aggregate principal amount of 0.509% senior notes of KKR due 2023. Borrowing outstanding is presented net of unamortized debt issuance costs of $1.2 million and $1.3 million as of March 31, 2019 and December 31, 2018 , respectively. These senior notes are denominated in Japanese Yen ("JPY"). (5) ¥5.0 billion (or $45.1 million ) aggregate principal amount of 0.764% senior notes of KKR due 2025. Borrowing outstanding is presented net of unamortized debt issuance costs of $0.7 million and $0.7 million as of March 31, 2019 and December 31, 2018 , respectively. These senior notes are denominated in JPY. (6) ¥10.3 billion (or $92.9 million ) aggregate principal amount of 1.595% senior notes of KKR due 2038. Borrowing outstanding is presented net of unamortized debt issuance costs of $1.2 million and $1.2 million as of March 31, 2019 and December 31, 2018 , respectively. These senior notes are denominated in JPY. (7) KKR consolidates KFN and thus reports KFN's outstanding $500.0 million aggregate principal amount of 5.500% senior notes due 2032. Borrowing outstanding is presented net of (i) unamortized note discount and (ii) unamortized debt issuance costs of $4.3 million and $4.4 million as of March 31, 2019 and December 31, 2018 , respectively. These debt obligations are classified as Level III within the fair value hierarchy and valued using the same valuation methodologies as KKR's Level III credit investments. (8) KKR consolidates KFN and thus reports KFN's outstanding $120.0 million aggregate principal amount of 5.200% senior notes due 2033. Borrowing outstanding is presented net of unamortized debt issuance costs of $1.7 million and $1.7 million as of March 31, 2019 and December 31, 2018 , respectively. These debt obligations are classified as Level III within the fair value hierarchy and valued using the same valuation methodologies as KKR's Level III credit investments. (9) KKR consolidates KFN and thus reports KFN's outstanding $70.0 million aggregate principal amount of 5.400% senior notes due 2033. Borrowing outstanding is presented net of unamortized debt issuance costs of $1.3 million and $1.3 million as of March 31, 2019 and December 31, 2018 , respectively. These debt obligations are classified as Level III within the fair value hierarchy and valued using the same valuation methodologies as KKR's Level III credit investments. (10) KKR consolidates KFN and thus reports KFN's outstanding $258.5 million aggregate principal amount of junior subordinated notes. The weighted average interest rate is 5.2% and 5.0% and the weighted average years to maturity is 17.5 years and 17.8 years as of March 31, 2019 and December 31, 2018 , respectively. These debt obligations are classified as Level III within the fair value hierarchy and valued using the same valuation methodologies as KKR's Level III credit investments. (11) Amounts include (i) borrowings at consolidated investment funds relating to financing arrangements with major financial institutions, generally to enable such investment funds to make investments prior to or without receiving capital from fund limited partners and (ii) borrowings by certain majority-owned investment vehicles that are collateralized only by the investments and assets they own. The weighted average interest rate is 4.9% and 4.6% as of March 31, 2019 and December 31, 2018 , respectively. In addition, the weighted average years to maturity is 3.6 years and 3.3 years as of March 31, 2019 and December 31, 2018 , respectively. (12) CLO debt obligations are carried at fair value and are classified as Level II within the fair value hierarchy. See Note 5 "Fair Value Measurements." (13) CMBS debt obligations are carried at fair value and are classified as Level III within the fair value hierarchy. See Note 5 "Fair Value Measurements." (14) The notes are classified as Level II within the fair value hierarchy and fair value is determined by third party broker quotes. Revolving Credit Facilities KCM Credit Agreement KKR Capital Markets maintains a revolving credit agreement with a major financial institution (the "KCM Credit Agreement") for use in KKR's capital markets business, which provides for revolving borrowings of up to $500 million with a $500 million sublimit for letters of credit. As of March 31, 2019 and December 31, 2018, no amounts were outstanding under the KCM Credit Agreement, however various letters of credit were outstanding in the amount of $65.6 million and $48.7 million , respectively, which reduce the overall borrowing capacity of the KCM Credit Agreement. Other Debt Obligations Debt Obligations of Consolidated CFEs As of March 31, 2019 , debt obligations of consolidated CFEs consisted of the following: Borrowing Outstanding Weighted Average Interest Rate Weighted Average Remaining Maturity in Years Senior Secured Notes of Consolidated CLOs $ 12,155,621 3.4 % 11.5 Subordinated Notes of Consolidated CLOs 402,200 (1) 11.7 Debt Obligations of Consolidated CMBS Vehicles 1,914,571 4.0 % 24.5 $ 14,472,392 (1) The subordinated notes do not have contractual interest rates but instead receive a pro rata amount of the net distributions from the excess cash flows of the respective CLO vehicle. Accordingly, weighted average borrowing rates for the subordinated notes are based on cash distributions during the period, if any. Debt obligations of consolidated CFEs are collateralized by assets held by each respective CFE vehicle and assets of one CFE vehicle may not be used to satisfy the liabilities of another. As of March 31, 2019 , the fair value of the consolidated CFE assets was $15.8 billion . This collateral consisted of Cash and Cash Equivalents Held at Consolidated Entities, Investments, and Other Assets. Debt Covenants Borrowings of KKR contain various debt covenants. These covenants do not, in management's opinion, materially restrict KKR's operating business or investment strategies as of March 31, 2019 . KKR is in compliance with its debt covenants in all material respects as of March 31, 2019 . |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES KKR & Co. Inc. is a corporation for U.S. federal income tax purposes and thus is subject to U.S. federal, state and local corporate income taxes at the entity level on KKR’s share of net taxable income. In addition, the KKR Group Partnerships and certain of their subsidiaries operate in the United States as partnerships for U.S. federal income tax purposes and as corporate entities in certain non-U.S. jurisdictions. These entities, in some cases, are subject to U.S. state or local income taxes or non-U.S. income taxes. The Conversion resulted in KKR obtaining a partial step-up in the tax basis of certain assets that will be recovered as those assets are sold or the basis is amortized. KKR's overall tax provision is based on, among other things, the amount of such partial step-up in tax basis that is derived from an analysis of the basis of its former unitholders in their ownership of KKR common units at June 30, 2018. On the date of the Conversion, based on the information available to KKR at that time, KKR recorded an estimated net tax benefit and estimated net deferred tax asset of $257.1 million relating to this partial step-up in tax basis. Upon analysis of the basis of KKR's former unitholders in their ownership of KKR common units at June 30, 2018, based on the additional information made available to KKR after December 31, 2018, the final determination of the amount of partial step-up in tax basis resulted in an additional tax benefit of approximately $45.0 million . The effective tax rates were 9.34% and 2.84% for the three months ended March 31, 2019 and 2018, respectively. The effective tax rate differs from the statutory rate primarily due to the following: (i) a substantial portion of the reported net income (loss) before taxes is not attributable to KKR but rather is attributable to noncontrolling interests held in KKR’s consolidated entities by KKR Holdings or by third parties, and (ii) the tax benefit recognized as a result of the final determination of the amount of the partial step-up in tax basis as a result of the Conversion. For periods prior to the Conversion, the effective rate also differs from the statutory rate as a result of investment income of certain entities and net carried interest of certain general partners of KKR investment funds that were not subject to U.S. federal income taxes prior to the Conversion. During the three months ended March 31, 2019 , there were no material changes to KKR’s uncertain tax positions and KKR believes there will be no significant increase or decrease to the uncertain tax positions within 12 months of the reporting date. |
EQUITY BASED COMPENSATION
EQUITY BASED COMPENSATION | 3 Months Ended |
Mar. 31, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
EQUITY BASED COMPENSATION | EQUITY BASED COMPENSATION The following table summarizes the expense associated with equity-based compensation for the three months ended March 31, 2019 and 2018 , respectively. Three Months Ended March 31, 2019 2018 Equity Incentive Plans $ 54,885 $ 67,796 KKR Holdings Principal Awards 23,666 27,282 Total (1) $ 78,551 $ 95,078 (1) Includes $(0.3) million and $4.3 million of equity based compensation for the three months ended March 31, 2019 and 2018 related to employees of equity method investees. Such amounts are included in Net Gains (Losses) from Investment Activities in the consolidated statements of operations. Equity Incentive Plans On March 29, 2019, the 2019 Equity Incentive Plan became effective. Following the effectiveness of the 2019 Equity Incentive Plan, KKR will not make any further grants under the 2010 Equity Incentive Plan, and the 2019 New Equity Incentive Plan became KKR's only plan for providing new equity-based awards. Outstanding awards under the 2010 Equity Incentive Plan will remain outstanding, unchanged and subject to the terms of the 2010 Equity Incentive Plan and their respective equity award agreements, until the vesting, expiration or lapse of such awards in accordance with their terms. There are no significant differences in the expense recognition between the 2010 Equity Incentive Plan and the 2019 New Equity Incentive Plan. Under the 2019 Equity Incentive Plan, KKR is permitted to grant equity awards representing ownership interests in KKR & Co. Inc. Class A common stock. The total number of shares of Class A common stock that may be issued under the 2019 Equity Incentive Plan is equivalent to 15% of the aggregate number of the shares of Class A common stock and KKR Group Partnership Units (excluding KKR Group Partnership Units held by KKR & Co. Inc. or its wholly-owned subsidiaries), subject to annual adjustment. Vested awards under the Equity Incentive Plans dilute KKR & Co. Inc. common stockholders and KKR Holdings pro rata in accordance with their respective percentage interests in the KKR Group Partnerships. Equity awards have been granted under the Equity Incentive Plans and are generally subject to service-based vesting, typically over a three to five year period from the date of grant. In certain cases, these awards are subject to transfer restrictions and/or minimum retained ownership requirements. The transfer restriction period, if applicable, lasts for (i) one year with respect to one-half of the interests vesting on any vesting date and (ii) two years with respect to the other one-half of the interests vesting on such vesting date. While providing services to KKR, if applicable, certain of these awards are also subject to minimum retained ownership rules requiring the award recipient to continuously hold shares of Class A common stock equivalents equal to at least 15% of their cumulatively vested awards that have the minimum retained ownership requirement. Expense associated with the vesting of these awards is based on the closing price of the KKR & Co. Inc. Class A common stock on the date of grant, discounted for the lack of participation rights in the expected dividends on unvested shares. The discount range for awards granted prior to December 31, 2015 was based on management's estimates of future dividends that the unvested equity awards would not be entitled to receive between the grant date and the vesting date which ranged from 8% to 56% . The following table presents information regarding the discount for the lack of participation rights in the expected dividends for shares granted subsequent to December 31, 2015: Date of Grant Discount per share (1) January 1, 2016 to December 31, 2016 $ 0.64 January 1, 2017 to December 31, 2017 $ 0.68 January 1, 2018 to June 30, 2018 $ 0.68 July 1, 2018 to Present $ 0.50 (1) Represents the annual discount for the lack of participation rights on expected dividends. The total discount on any given tranche of unvested shares is calculated as the discount per share multiplied by the number of years in the applicable vesting period. Expense is recognized on a straight line basis over the life of the award and assumes a forfeiture rate of up to 7% annually based upon expected turnover by class of recipient. Market Condition Awards On November 2, 2017, KKR's Co-Presidents and Co-Chief Operating Officers were each granted equity awards representing 2.5 million shares of KKR Class A common stock subject to a market price-based vesting condition ("Market Condition Awards"). These awards were granted under the 2010 Equity Incentive Plan. All of such awards will vest upon the market price of KKR Class A common stock reaching and maintaining a closing market price of $40 per share for 10 consecutive trading days on or prior to December 31, 2022, subject to the employee's continued service to the time of such vesting. If the $40 price target is not achieved by the close of business on December 31, 2022, the unvested Market Condition Awards will be automatically canceled and forfeited. These Market Condition Awards are subject to additional transfer restrictions and minimum retained ownership requirements after vesting. Due to the existence of the market condition, the vesting period for the Market Condition Awards is not explicit, and as such, compensation expense will be recognized over the period derived from the valuation technique used to estimate the grant-date fair value of the award (the "Derived Vesting Period"). The fair value of the Market Condition Awards at the date of grant was $4.02 per share based on a Monte-Carlo simulation valuation model due to the existence of the market condition described above. Below is a summary of the significant assumptions used to estimate the grant date fair value of the Market Condition Awards: Closing KKR share price as of valuation date $19.90 Risk Free Rate 2.02 % Volatility 25.00 % Dividend Yield 3.42 % Expected Cost of Equity 11.02 % In addition, the grant date fair value assumes that holders of the Market Condition Awards will not participate in dividends until such awards have met their vesting requirements. Compensation expense is recognized over the Derived Vesting Period, which was estimated to be 3 years from the date of grant, on a straight-line basis. As of March 31, 2019 , there was approximately $10.7 million of estimated unrecognized compensation expense related to unvested Market Condition Awards and such awards did not meet their market-price based vesting condition. As of March 31, 2019 , there was approximately $340.4 million of total estimated unrecognized expense related to unvested awards, including Market Condition Awards. That cost is expected to be recognized as follows: Year Unrecognized Expense Remainder of 2019 $ 132.8 2020 131.8 2021 58.5 2022 16.4 2023 0.9 Total $ 340.4 A summary of the status of unvested awards granted under the Equity Incentive Plans, excluding Market Condition Awards as described above, from January 1, 2019 through March 31, 2019 is presented below: Shares Weighted Average Grant Date Fair Value Balance, January 1, 2019 33,400,183 $ 16.23 Granted 50,511 18.96 Vested (15,440 ) 15.83 Forfeitures (604,519 ) 17.43 Balance, March 31, 2019 32,830,735 $ 16.21 The weighted average remaining vesting period over which unvested awards are expected to vest is 1.1 years . A summary of the remaining vesting tranches of awards granted under the Equity Incentive Plans is presented below: Vesting Date Shares April 1, 2019 8,917,856 October 1, 2019 4,733,416 April 1, 2020 7,135,649 October 1, 2020 3,607,073 April 1, 2021 4,093,420 October 1, 2021 2,134,028 April 1, 2022 916,731 October 1, 2022 1,201,390 October 1, 2023 91,172 32,830,735 KKR Holdings Awards KKR Holdings units are exchangeable for KKR Group Partnership Units and allow for their exchange into Class A common stock of KKR & Co. Inc. on a one -for-one basis. As of March 31, 2019 and 2018, KKR Holdings owned approximately 35.9% or 298,645,285 units and 40.5% or 333,648,078 units, respectively, of outstanding KKR Group Partnership Units. Awards for KKR Holdings units that have been granted are generally subject to service based vesting, typically over a three to five year period from the date of grant. They are also generally subject to transfer restrictions which last for (i) one year with respect to one-half of the interests vesting on any vesting date and (ii) two years with respect to the other one-half of the interests vesting on such vesting date. While providing services to KKR, the recipients are also subject to minimum retained ownership rules requiring them to continuously hold 25% of their vested interests. Upon separation from KKR, award recipients are subject to the terms of a confidentiality and restrictive covenants agreement that would require the forfeiture of certain vested and unvested units should the terms of the agreement be violated. Holders of KKR Holdings units are not entitled to participate in distributions made on KKR Group Partnership Units underlying their KKR Holdings units until such units are vested. All of the KKR Holdings units (except for less than 0.6% of the outstanding KKR Holdings units) have been granted as of March 31, 2019 , and certain Holdings units remain subject to vesting. The fair value of awards granted out of KKR Holdings is generally based on the closing price of KKR & Co. Inc. Class A common stock on the date of grant discounted for the lack of participation rights in the expected distributions on unvested units. KKR determined this to be the best evidence of fair value as KKR & Co. Inc. Class A common stock is traded in an active market and has an observable market price. Additionally, a KKR Holdings unit is an instrument with terms and conditions similar to those of KKR & Co. Inc. Class A common stock. Specifically, units in KKR Holdings and shares of KKR & Co. Inc. represent ownership interests in KKR Group Partnership Units and, subject to any vesting, minimum retained ownership requirements and transfer restrictions, each KKR Holdings unit is exchangeable into a KKR Group Partnership Unit and then into a share of KKR & Co. Inc. Class A common stock on a one -for-one basis. In February 2016, approximately 28.9 million KKR Holdings units were granted that were originally subject to market condition and service-based vesting that were subsequently modified in November 2016 to eliminate the market condition vesting and instead require only service-based vesting in equal annual installments over a five year period. At the date of modification, total future compensation expense amounted to $320.9 million , net of estimated forfeitures, to be recognized over the remaining vesting period of the modified awards. The awards described above were granted from outstanding but previously unallocated units of KKR Holdings, and consequently these grants did not increase the number of KKR Holdings units outstanding or outstanding KKR & Co. Inc. Class A common stock on a fully-diluted basis. If and when vested, these awards will not dilute KKR's respective ownership interests in the KKR Group Partnerships. KKR Holdings Awards give rise to equity-based compensation in the consolidated statements of operations based on the grant-date fair value of the award discounted for the lack of participation rights in the expected distributions on unvested units. This discount is consistent with that noted above for shares issued under the Equity Incentive Plans. Expense is recognized on a straight line basis over the life of the award and assumes a forfeiture rate of up to 7% annually based on expected turnover by class of recipient. As of March 31, 2019 , there was approximately $230.3 million of estimated unrecognized expense related to unvested KKR Holdings awards. That cost is expected to be recognized as follows: Year Unrecognized Expense Remainder of 2019 $ 70.7 2020 86.9 2021 47.2 2022 25.5 Total $ 230.3 A summary of the status of unvested awards granted under the KKR Holdings Plan from January 1, 2019 through March 31, 2019 is presented below: Units Weighted Average Grant Date Fair Value Balance, January 1, 2019 24,123,993 $ 14.42 Granted — — Vested — — Forfeitures (270,000 ) 16.28 Balance, March 31, 2019 23,853,993 $ 14.40 The weighted average remaining vesting period over which unvested awards are expected to vest is 1.7 years. A summary of the remaining vesting tranches of awards granted under the KKR Holdings Plan is presented below: Vesting Date Units April 1, 2019 229,514 May 1, 2019 3,590,000 October 1, 2019 2,455,000 April 1, 2020 124,479 May 1, 2020 3,590,000 October 1, 2020 2,940,000 May 1, 2021 3,590,000 October 1, 2021 3,425,000 October 1, 2022 3,910,000 23,853,993 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Mar. 31, 2019 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONS Due from Affiliates consists of: March 31, 2019 December 31, 2018 Amounts due from portfolio companies $ 93,855 $ 82,204 Amounts due from unconsolidated investment funds 637,501 568,211 Amounts due from related entities 2,839 6,774 Due from Affiliates $ 734,195 $ 657,189 Due to Affiliates consists of: March 31, 2019 December 31, 2018 Amounts due to KKR Holdings in connection with the tax receivable agreement $ 108,270 $ 117,862 Amounts due to unconsolidated investment funds 146,511 157,722 Due to Affiliates $ 254,781 $ 275,584 |
SEGMENT REPORTING
SEGMENT REPORTING | 3 Months Ended |
Mar. 31, 2019 | |
Segment Reporting [Abstract] | |
SEGMENT REPORTING | SEGMENT REPORTING KKR operates through one operating and reportable segment. This single reportable segment reflects how the chief operating decision makers allocate resources and assess performance under KKR's "one-firm approach," which includes operating collaboratively across business lines, with predominantly a single expense pool. KKR’s segment reporting is presented prior to giving effect to the allocation of income (loss) between KKR & Co. Inc. and KKR Holdings L.P. and as such represents the business in total. In addition, KKR’s segment reporting is presented without giving effect to the consolidation of the investment funds and CFEs that KKR manages as well as other consolidated entities that are not subsidiaries of KKR & Co. Inc. The segment measures used in KKR’s segment reporting, including segment revenues, segment expenses, after-tax distributable earnings, segment assets, segment liabilities, and segment book value are used by management in making operational and resource deployment decisions as well as assessing the overall performance of KKR’s business. After-tax Distributable Earnings After-tax distributable earnings is a performance measure of KKR’s earnings on a segment basis excluding mark-to-market gains (losses). Starting with the second quarter of 2018, it is defined as the amount of net realized earnings of KKR for a given reporting period, after deducting equity-based compensation. KKR revised the definition of after-tax distributable earnings starting in the second quarter of 2018, because it reflects how the chief operating decision makers allocate resources and assess the performance of KKR’s business. KKR believes that after-tax distributable earnings is useful to stockholders as it aligns KKR’s net realization performance with the manner in which KKR receives its revenues and determines the compensation of its employees. After-tax distributable earnings does not represent and is not used to calculate actual dividends under KKR’s dividend policy. Historically, equity-based compensation expense relating to the Equity Incentive Plans was not reflected in our calculation of after-tax distributable earnings. Under KKR’s segment presentation, equity-based compensation expense is included in after-tax distributable earnings as a component of compensation expense in order to reflect the dilutive nature of these non-cash equity-based awards. For comparability, after-tax distributable earnings for the comparable prior periods have been calculated using this definition. The following table sets forth information regarding KKR's segment results: As of and for the Three Months Ended March 31, 2019 March 31, 2018 Segment Revenues Fees and Other, Net Management Fees $ 292,296 $ 251,585 Transaction Fees 186,727 156,845 Monitoring Fees 25,651 17,530 Fee Credits (107,416 ) (43,774 ) Total Fees and Other, Net 397,258 382,186 Realized Performance Income (Loss) Carried Interest 330,345 202,555 Incentive Fees 19,537 16,407 Total Realized Performance Income (Loss) 349,882 218,962 Realized Investment Income (Loss) Net Realized Gains (Losses) 44,712 7,875 Interest Income and Dividends 58,207 72,577 Total Realized Investment Income (Loss) 102,919 80,452 Total Segment Revenues $ 850,059 $ 681,600 Segment Expenses Compensation and Benefits (1) 340,286 300,480 Occupancy and Related Charges 13,957 13,583 Other Operating Expenses 74,910 57,905 Total Segment Expenses $ 429,153 $ 371,968 Segment Operating Earnings 420,906 309,632 Interest Expense 44,130 50,192 Preferred Dividends 8,341 8,341 Income (Loss) Attributable to Noncontrolling Interests 359 1,203 Income Taxes Paid 53,993 14,168 After-tax Distributable Earnings $ 314,083 $ 235,728 Segment Assets $ 18,770,564 $ 16,243,603 Segment Liabilities $ 4,100,354 $ 3,736,797 Segment Book Value $ 14,148,206 $ 11,983,289 (1) Includes equity-based compensation of $54.9 million and $67.8 million for the three months ended March 31, 2019 and 2018 , respectively. KKR's business lines are differentiated primarily by their business objectives, investment strategies and sources of revenue, and are summarized below. Through KKR's Private Markets business line, KKR manages and sponsors private equity funds and co-investment vehicles, which invest capital for long-term appreciation, either through controlling ownership of a company or strategic minority positions. In addition to its traditional private equity funds, KKR sponsors investment funds that invest in growth equity and core investments. KKR also manages and sponsors investment funds and co-investment vehicles that invest capital in real assets, such as infrastructure, energy, and real estate. Through KKR's Public Markets business line, KKR operates its combined credit and hedge funds platforms. KKR's credit platform invests capital in leveraged credit strategies, including leveraged loans, high-yield bonds, opportunistic credit, and revolving credit strategies, and alternative credit strategies including special situations and private credit opportunities, such as direct lending and private opportunistic credit investment strategies. KKR's hedge funds platform consists of hedge fund partnerships with third-party hedge fund managers in which KKR owns a minority stake. KKR's Capital Markets business line supports the firm, portfolio companies, and third-party clients by developing and implementing both traditional and non-traditional capital solutions for investments or companies seeking financing. These services include arranging debt and equity financing, placing and underwriting securities offerings and providing other types of capital markets services. Through KKR's Principal Activities business line, KKR manages the firm's assets and deploys capital to support and grow its business lines including making capital commitments as general partner to its funds, to seed new business strategies or investments for new funds or to bridge capital selectively for its funds' investments. The Principal Activities business line also provides the required capital to fund the various commitments of KKR's Capital Markets business line or to meet regulatory capital requirements. The following tables provide KKR's segment revenues on a disaggregated basis by business line: Three Months Ended March 31, 2019 Private Markets Public Markets Capital Markets Principal Activities Total Fees and Other, Net Management Fees $ 183,221 $ 109,075 $ — $ — $ 292,296 Transaction Fees 99,017 27,456 60,254 — 186,727 Monitoring Fees 25,651 — — — 25,651 Fee Credits (82,342 ) (25,074 ) — — (107,416 ) Total Fees and Other, Net 225,547 111,457 60,254 — 397,258 Realized Performance Income (Loss) Carried Interest 330,345 — — — 330,345 Incentive Fees 675 18,862 — — 19,537 Total Realized Performance Income (Loss) 331,020 18,862 — — 349,882 Realized Investment Income (Loss) Net Realized Gains (Losses) — — — 44,712 44,712 Interest Income and Dividends — — — 58,207 58,207 Total Realized Investment Income (Loss) — — — 102,919 102,919 Total $ 556,567 $ 130,319 $ 60,254 $ 102,919 $ 850,059 Three Months Ended March 31, 2018 Private Markets Public Markets Capital Markets Principal Activities Total Fees and Other, Net Management Fees $ 158,190 $ 93,395 $ — $ — $ 251,585 Transaction Fees 46,689 2,558 107,598 — 156,845 Monitoring Fees 17,530 — — — 17,530 Fee Credits (41,343 ) (2,431 ) — — (43,774 ) Total Fees and Other, Net 181,066 93,522 107,598 — 382,186 Realized Performance Income (Loss) Carried Interest 202,555 — — — 202,555 Incentive Fees — 16,407 — — 16,407 Total Realized Performance Income (Loss) 202,555 16,407 — — 218,962 Realized Investment Income (Loss) Net Realized Gains (Losses) — — — 7,875 7,875 Interest Income and Dividends — — — 72,577 72,577 Total Realized Investment Income (Loss) — — — 80,452 80,452 Total $ 383,621 $ 109,929 $ 107,598 $ 80,452 $ 681,600 The following tables reconcile the most directly comparable financial measures calculated and presented in accordance with GAAP to KKR's segment information: Revenues Three Months Ended March 31, 2019 March 31, 2018 Total GAAP Revenues $ 1,187,480 $ 472,606 Add: Management Fees - Consolidated Funds and Other 121,949 64,596 Deduct: Fee Credits - Consolidated Funds 3,939 14,721 Deduct: Capital Allocation-Based Income (GAAP) 814,932 78,212 Add: Segment Realized Carried Interest 330,345 202,555 Add: Segment Realized Investment Income (Loss) 102,919 80,452 Deduct: Revenue Earned by Other Consolidated Entities 29,703 25,465 Deduct: Expense Reimbursements 44,060 20,211 Total Segment Revenues $ 850,059 $ 681,600 Expenses Three Months Ended March 31, 2019 March 31, 2018 Total GAAP Expenses $ 728,767 $ 436,601 Deduct: Equity-based and Other Compensation - KKR Holdings L.P. 23,743 32,695 Deduct: Segment Unrealized Performance Income Compensation 159,880 (43,123 ) Deduct: Amortization of Intangibles 535 5,030 Deduct: Reimbursable Expenses 52,032 26,093 Deduct: Operating Expenses relating to Other Consolidated Entities 51,818 44,309 Add: Other (11,606 ) 371 Total Segment Expenses $ 429,153 $ 371,968 Net Income (Loss) Attributable to KKR & Co. Inc. Class A Common Stockholders Three Months Ended March 31, 2019 March 31, 2018 GAAP Net Income (Loss) Attributable to KKR & Co. Inc. Class A Common Stockholders $ 700,978 $ 170,102 Add: Net Income (Loss) Attributable to Noncontrolling Interests held by KKR Holdings L.P. 481,368 121,002 Add: Equity-based and Other Compensation - KKR Holdings L.P. 23,118 32,695 Add: Amortization of Intangibles and Other, net 56,153 47,709 Deduct: Unrealized Carried Interest 401,612 (111,732 ) Deduct: Net Unrealized Gains (Losses) 819,402 207,862 Add: Unrealized Performance Income Compensation 159,880 (43,123 ) Add: Income Tax Provision 167,593 17,641 Deduct: Income Taxes Paid 53,993 14,168 After-tax Distributable Earnings $ 314,083 $ 235,728 The items that reconcile KKR's reportable segment income (loss) attributable to noncontrolling interests to the corresponding consolidated amounts calculated and presented in accordance with GAAP for net income (loss) attributable to redeemable noncontrolling interests and income (loss) attributable to noncontrolling interests are primarily attributable to the impact of KKR Holdings L.P., KKR's consolidated funds, and certain other consolidated entities. Assets As of March 31, 2019 2018 GAAP Assets $ 52,004,019 $ 47,579,153 Impact of Consolidation of Investment Vehicles and Other Entities (31,561,635 ) (29,972,064 ) Carry Pool Reclassification (1,089,045 ) (1,176,070 ) Other Reclassifications (582,775 ) — Impact of KKR Management Holdings Corp. — (187,416 ) Segment Assets (1) $ 18,770,564 $ 16,243,603 Liabilities As of March 31, 2019 2018 GAAP Liabilities $ 25,796,178 $ 25,810,215 Impact of Consolidation of Investment Vehicles and Other Entities (20,024,004 ) (20,775,320 ) Carry Pool Reclassification (1,089,045 ) (1,176,070 ) Other Reclassifications (582,775 ) — Impact of KKR Management Holdings Corp. — (122,028 ) Segment Liabilities (1) $ 4,100,354 $ 3,736,797 Stockholders' Equity As of March 31, 2019 2018 KKR & Co. Inc. Stockholders' Equity - Common Stockholders $ 8,839,817 $ 6,918,185 Impact of Consolidation of Investment Vehicles and Other Entities 246,793 254,777 Other Reclassifications (17,446 ) (17,446 ) Noncontrolling Interests Held by KKR Holdings L.P. 5,079,042 4,893,161 Impact of KKR Management Holdings Corp. — (65,388 ) Segment Book Value (1) $ 14,148,206 $ 11,983,289 (1) As of March 31, 2019 , KKR's segment assets, liabilities, and book value reflect KKR's tax assets and liabilities prepared under GAAP. |
EQUITY
EQUITY | 3 Months Ended |
Mar. 31, 2019 | |
Equity [Abstract] | |
EQUITY | EQUITY Share Repurchase Program KKR increased the available amount under its repurchase program to $500 million , which may be used for the repurchase of its shares of Class A common stock of KKR & Co. Inc. and retirement of equity awards issued pursuant to the Equity Incentive Plans. Under this repurchase program, shares of Class A common stock of KKR & Co. Inc. may be repurchased from time to time in open market transactions, in privately negotiated transactions or otherwise. The timing, manner, price and amount of any repurchases will be determined by KKR in its discretion and will depend on a variety of factors, including legal requirements, price and economic and market conditions. KKR expects that the program, which has no expiration date, will be in effect until the maximum approved dollar amount has been used. The program does not require KKR to repurchase any specific number of shares of Class A common stock of KKR & Co. Inc., and the program may be suspended, extended, modified or discontinued at any time. During the three months ended March 31, 2019 , approximately 1.4 million shares of Class A common stock were repurchased pursuant to this program. There were no shares of Class A common stock repurchased pursuant to this program during the three months ended March 31, 2018 . During the three months ended March 31, 2019 and 2018, no equity awards were retired pursuant to this program. Noncontrolling Interests Noncontrolling interests represent (i) noncontrolling interests in consolidated entities and (ii) noncontrolling interests held by KKR Holdings. Noncontrolling Interests in Consolidated Entities Noncontrolling interests in consolidated entities represent the non-redeemable ownership interests in KKR that are held primarily by: (i) third party fund investors in KKR's consolidated funds and certain other entities; (ii) third parties entitled to up to 1% of the carried interest received by certain general partners of KKR's funds that have made investments on or prior to December 31, 2015; (iii) certain former principals and their designees representing a portion of the carried interest received by the general partners of KKR's private equity funds that was allocated to them with respect to private equity investments made during such former principals' tenure with KKR prior to October 1, 2009; (iv) certain principals and former principals representing all of the capital invested by or on behalf of the general partners of KKR's private equity funds prior to October 1, 2009 and any returns thereon; and (v) third parties in KKR's capital markets business line. Noncontrolling Interests held by KKR Holdings Noncontrolling interests held by KKR Holdings include economic interests held by principals indirectly in the KKR Group Partnership Units. Such principals receive financial benefits from KKR's business in the form of distributions received from KKR Holdings and through their direct and indirect participation in the value of KKR Group Partnership Units held by KKR Holdings. These financial benefits are not paid by KKR & Co. Inc. and are borne by KKR Holdings. The following table presents the calculation of total noncontrolling interests: Three Months Ended March 31, 2019 Noncontrolling Interests in Consolidated Entities Noncontrolling Interests Held by KKR Holdings Total Noncontrolling Interests Balance at the beginning of the period $ 10,984,910 $ 4,625,448 $ 15,610,358 Net income (loss) attributable to noncontrolling interests (1) 436,359 481,368 917,727 Other comprehensive income (loss), net of tax (2) 2,511 121 2,632 Exchange of KKR Holdings Units to Class A Common Stock (3) — (7,094 ) (7,094 ) Equity-based and other non-cash compensation — 23,118 23,118 Capital contributions 1,194,792 23 1,194,815 Capital distributions (812,144 ) (43,942 ) (856,086 ) Balance at the end of the period $ 11,806,428 $ 5,079,042 $ 16,885,470 (1) Refer to the table below for calculation of net income (loss) attributable to noncontrolling interests held by KKR Holdings. (2) With respect to noncontrolling interests held by KKR Holdings, calculated on a pro rata basis based on the weighted average KKR Group Partnership Units held by KKR Holdings during the reporting period. (3) Calculated based on the proportion of KKR Holdings units exchanged for KKR & Co. Inc. Class A common stock during the reporting period. The exchange agreement with KKR Holdings provides for the exchange of KKR Group Partnership Units held by KKR Holdings for KKR & Co. Inc. Class A common stock. Net income (loss) attributable to each of KKR & Co. Inc. Class A common stockholders and KKR Holdings, with the exception of certain tax assets and liabilities that are directly allocable to KKR & Co. Inc., is attributed based on the percentage of the weighted average KKR Group Partnership Units directly or indirectly held by KKR & Co. Inc. and KKR Holdings, each of which directly or indirectly holds equity of the KKR Group Partnerships. However, primarily because of the (i) contribution of certain expenses borne entirely by KKR Holdings, (ii) the periodic exchange of KKR Holdings units for KKR & Co. Inc. Class A common stock pursuant to the exchange agreement and (iii) the contribution of certain expenses borne entirely by KKR associated with the Equity Incentive Plans, equity allocations shown in the consolidated statement of changes in equity differ from their respective pro rata ownership interests in KKR's net assets. The following table presents net income (loss) attributable to noncontrolling interests held by KKR Holdings: Three Months Ended March 31, 2019 2018 Net income (loss) $ 1,627,046 $ 602,894 Less: Net income (loss) attributable to Redeemable Noncontrolling Interests — 25,674 Less: Net income (loss) attributable to Noncontrolling Interests in consolidated entities 436,359 277,775 Less: Preferred Stock Dividends 8,341 8,341 Plus: Income tax expense (benefit) attributable to KKR & Co. Inc. 158,962 6,068 Net income (loss) attributable to KKR & Co. Inc. Class A Common Stockholders and KKR Holdings $ 1,341,308 $ 297,172 Net income (loss) attributable to Noncontrolling Interests held by KKR Holdings $ 481,368 $ 121,002 Redeemable Noncontrolling Interests Redeemable Noncontrolling Interests represent noncontrolling interests of certain investment funds and vehicles that are subject to periodic redemption by fund investors following the expiration of a specified period of time (typically one year), or may be withdrawn subject to a redemption fee during the period when capital may not be otherwise withdrawn. Fund investors interests subject to redemption as described above are presented as Redeemable Noncontrolling Interests in the accompanying consolidated statements of financial condition and presented as Net Income (Loss) Attributable to Redeemable Noncontrolling Interests in the accompanying consolidated statements of operations. There was no impact to Redeemable Noncontrolling Interests upon Conversion. When redeemable amounts become legally payable to fund investors, they are classified as a liability and included in Accounts Payable, Accrued Expenses and Other Liabilities in the accompanying consolidated statements of financial condition. For all consolidated investment vehicles and funds in which redemption rights have not been granted, noncontrolling interests are presented within Stockholders' Equity in the accompanying consolidated statements of financial condition as noncontrolling interests. The following table presents the rollforward of Redeemable Noncontrolling Interests: For the Three Months Ended March 31, 2019 Balance at the beginning of the period $ 1,122,641 Changes in consolidation (1,122,641 ) Balance at the end of the period $ — |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Funding Commitments As of March 31, 2019 , KKR had unfunded commitments consisting of $5,086.9 million to its active investment vehicles. In addition to the uncalled commitments to KKR's investment funds, KKR has entered into contractual commitments with respect to (i) the purchase of investments and other assets in its Principal Activities business line and (ii) underwriting transactions, debt financing, and syndications in KKR's Capital Markets business line. As of March 31, 2019 , these commitments amounted to $153.7 million and $516.2 million , respectively. Whether these amounts are actually funded, in whole or in part, depends on the contractual terms of such commitments, including the satisfaction or waiver of any conditions to closing or funding. The unfunded commitments shown for KKR's Capital Markets business line are shown without reflecting arrangements that may reduce the actual amount of contractual commitments shown occurring after March 31, 2019 . KKR's capital markets business has an arrangement with a third party, which reduces its risk when underwriting certain debt transactions, and thus our unfunded commitments as of March 31, 2019 are reduced to reflect the amount to be funded by such third party. In the case of purchases of investments or assets in KKR's Principal Activities business line, the amount to be funded includes amounts that are intended to be syndicated to third parties, and the actual amounts to be funded may be less than shown. Non-cancelable Operating Leases KKR's non-cancelable operating leases consist of leases of office space around the world. There are no material rent holidays, contingent rent, rent concessions or leasehold improvement incentives associated with any of these property leases. In addition to base rentals, certain lease agreements are subject to escalation provisions and rent expense is recognized on a straight‑line basis over the term of the lease agreement. As of March 31, 2019 , the approximate aggregate minimum future lease payments, net of sublease income, required on the operating leases are as follows: April 2019 - March 2020 $ 50,312 April 2020 - March 2022 66,055 April 2022 - March 2024 26,828 April 2024 and thereafter 18,855 Total minimum payments required 162,050 Less: Imputed Interest (9,977 ) Total operating lease liabilities $ 152,073 As of March 31, 2019 , KKR has an additional operating lease for office space that has not yet commenced with minimum future lease payments of approximately $87.2 million over a lease term of 15 years . As of December 31, 2018, the approximate aggregate minimum future lease payments, net of sublease income, required on the operating leases are as follows: 2019 $ 50,649 2020 - 2021 69,263 2022 - 2023 29,687 2024 and thereafter 76,332 Total minimum payments required (1) $ 225,931 (1) Table depicts aggregate minimum future lease payments under ASC 840. Contingent Repayment Guarantees The partnership documents governing KKR's carry-paying investment funds and vehicles generally include a "clawback" provision that, if triggered, may give rise to a contingent obligation requiring the general partner to return amounts to the fund for distribution to the fund investors at the end of the life of the fund. Under a clawback obligation, upon the liquidation of a fund, the general partner is required to return, typically on an after-tax basis, previously distributed carry to the extent that, due to the diminished performance of later investments, the aggregate amount of carry distributions received by the general partner during the term of the fund exceed the amount to which the general partner was ultimately entitled, including the effects of any performance thresholds. As of March 31, 2019 , no carried interest was subject to this clawback obligation, assuming that all applicable carry-paying funds were liquidated at their March 31, 2019 fair values. Had the investments in such funds been liquidated at zero value, the clawback obligation would have been approximately $2.1 billion . Carried interest is recognized in the consolidated statements of operations based on the contractual conditions set forth in the agreements governing the fund as if the fund were terminated and liquidated at the reporting date and the fund's investments were realized at the then estimated fair values. Amounts earned pursuant to carried interest are earned by the general partner of those funds to the extent that cumulative investment returns are positive and where applicable, preferred return thresholds have been met. If these investment amounts earned decrease or turn negative in subsequent periods, recognized carried interest will be reversed and to the extent that the aggregate amount of carry distributions received by the general partner during the term of the fund exceed the amount to which the general partner was ultimately entitled, a clawback obligation would be recorded. For funds that are consolidated, this clawback obligation, if any, is reflected as an increase in noncontrolling interests in the consolidated statements of financial condition. For funds that are not consolidated, this clawback obligation, if any, is reflected as a reduction of KKR's investment balance as this is where carried interest is initially recorded. Indemnifications and Other Guarantees KKR may incur contingent liabilities for claims that may be made against it in the future. KKR enters into contracts that contain a variety of representations, warranties and covenants, including indemnifications. For example, certain of KKR's investment funds and KFN have provided certain indemnities relating to environmental and other matters and have provided nonrecourse carve-out guarantees for fraud, willful misconduct and other customary wrongful acts, each in connection with the financing of certain real estate investments that KKR has made and for certain investment vehicles that KKR manages. In addition, KKR has also provided credit support to certain of its subsidiaries' obligations in connection with a limited number of investment vehicles that KKR manages. For example, KKR has guaranteed the obligations of a general partner to post collateral on behalf of its investment vehicle in connection with such vehicle's derivative transactions, and KKR has also agreed to be liable for certain investment losses and/or for providing liquidity in the events specified in the governing documents of other investment vehicles. KKR has also provided credit support regarding repayment obligations to third-party lenders to certain of its employees, excluding its executive officers, in connection with their personal investments in KKR investment funds and to a hedge fund partnership regarding the ownership of its business. KKR also may become liable for certain fees payable to sellers of businesses or assets if a transaction does not close, subject to certain conditions, if any, specified in the acquisition agreements for such businesses or assets. KKR's maximum exposure under these arrangements is currently unknown and KKR's liabilities for these matters would require a claim to be made against KKR in the future. Litigation From time to time, KKR is involved in various legal proceedings, lawsuits and claims incidental to the conduct of KKR's business. KKR's business is also subject to extensive regulation, which may result in regulatory proceedings against it. In December 2017, KKR & Co. L.P. and its Co-Chief Executive Officers were named as defendants in a lawsuit pending in Kentucky state court alleging, among other things, the violation of fiduciary and other duties in connection with certain separately managed accounts that Prisma Capital Partners LP, a former subsidiary of KKR, manages for the Kentucky Retirement Systems. Also named as defendants in the lawsuit are certain current and former trustees and officers of the Kentucky Retirement Systems, Prisma Capital Partners LP, and various other service providers to the Kentucky Retirement Systems and their related persons. The defendants’ motion to dismiss was denied by the trial court in November 2018, but in April 2019 the Kentucky Court of Appeals vacated the trial court's opinion and order denying the motion to dismiss the case for lack of standing. The decision of the Court of Appeals has been appealed by plaintiffs to the Supreme Court of Kentucky. KKR currently is and expects to continue to become, from time to time, subject to examinations, inquiries and investigations by various U.S. and non-U.S. governmental and regulatory agencies, including but not limited to the SEC, Department of Justice, state attorney generals, Financial Industry Regulatory Authority, or FINRA, and the U.K. Financial Conduct Authority. Such examinations, inquiries and investigations may result in the commencement of civil, criminal or administrative proceedings or fines against KKR or its personnel. Moreover, in the ordinary course of business, KKR is and can be both the defendant and the plaintiff in numerous lawsuits with respect to acquisitions, bankruptcy, insolvency and other types of proceedings. Such lawsuits may involve claims that adversely affect the value of certain investments owned by KKR's funds. KKR establishes an accrued liability for legal proceedings only when those matters present loss contingencies that are both probable and reasonably estimable. In such cases, there may be an exposure to loss in excess of any amounts accrued. No loss contingency is recorded for matters where such losses are either not probable or reasonably estimable (or both) at the time of determination. Such matters may be subject to many uncertainties, including among others: (i) the proceedings may be in early stages; (ii) damages sought may be unspecified, unsupportable, unexplained or uncertain; (iii) discovery may not have been started or is incomplete; (iv) there may be uncertainty as to the outcome of pending appeals or motions; (v) there may be significant factual issues to be resolved or (vi) there may be novel legal issues or unsettled legal theories to be presented or a large number of parties. Consequently, management is unable to estimate a range of potential loss, if any, related to these matters. In addition, loss contingencies may be, in part or in whole, subject to insurance or other payments such as contributions and/or indemnity, which may reduce any ultimate loss. It is not possible to predict the ultimate outcome of all pending legal proceedings, and some of the matters discussed above seek or may seek potentially large and/or indeterminate amounts. As of such date, based on information known by management, management has not concluded that the final resolutions of the matters above will have a material effect upon the financial statements. However, given the potentially large and/or indeterminate amounts sought or may be sought in certain of these matters and the inherent unpredictability of investigations and litigations, it is possible that an adverse outcome in certain matters could, from time to time, have a material effect on KKR's financial results in any particular period. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Mar. 31, 2019 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTS Common Stock Dividend A dividend of $0.125 per share of Class A common stock of KKR & Co. Inc. was announced on April 30, 2019 , and will be paid on May 28, 2019 to Class A common stockholders of record as of the close of business on May 13, 2019 . KKR Holdings will receive its pro rata share of the distribution from the KKR Group Partnerships. Preferred Stock Dividend A dividend of $0.421875 per share of Series A Preferred Stock has been declared as announced on April 30, 2019 and set aside for payment on June 17, 2019 to holders of record of Series A Preferred Stock as of the close of business on June 1, 2019 . A dividend of $0.406250 per share of Series B Preferred Stock has been declared as announced on April 30, 2019 and set aside for payment on June 17, 2019 to holders of record of Series B Preferred Stock as of the close of business on June 1, 2019 . |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited financial statements of KKR & Co. Inc. have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") for interim financial information and the instructions to Form 10-Q. The condensed consolidated financial statements (referred to hereafter as the "financial statements"), including these notes, are unaudited and exclude some of the disclosures required in annual financial statements. Management believes it has made all necessary adjustments (consisting of only normal recurring items) such that the financial statements are presented fairly and that estimates made in preparing the financial statements are reasonable and prudent. The operating results presented for interim periods are not necessarily indicative of the results that may be expected for any other interim period or for the entire year. The December 31, 2018 consolidated balance sheet data was derived from audited financial statements included in KKR's Annual Report on Form 10-K for the year ended December 31, 2018, filed with the Securities and Exchange Commission (the "SEC") on February 15, 2019, and the financial statements should be read in conjunction with the audited financial statements included therein. Additionally, in the accompanying financial statements the condensed consolidated statements of financial condition are referred to hereafter as the “consolidated statements of financial condition”; the condensed consolidated statements of operations are referred to hereafter as the “consolidated statements of operations”; the condensed consolidated statements of comprehensive income (loss) are referred to hereafter as the “consolidated statements of comprehensive income (loss)”; the condensed consolidated statements of changes in equity are referred to hereafter as the “consolidated statements of changes in equity”; and the condensed consolidated statements of cash flows are referred to hereafter as the “consolidated statements of cash flows." KKR consolidates the financial results of the KKR Group Partnerships and their consolidated entities, which include the accounts of KKR's investment management and capital markets companies, the general partners of certain unconsolidated investment funds, general partners of consolidated investment funds and their respective consolidated investment funds, and certain other entities including CFEs. References in the accompanying financial statements to "principals" are to KKR's senior employees and non-employee operating consultants who hold interests in KKR's business through KKR Holdings. All intercompany transactions and balances have been eliminated. |
Use of Estimates | Use of Estimates The preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues, expenses, and investment income (loss) during the reporting periods. Such estimates include but are not limited to (i) the determination of the income tax provision and (ii) the valuation of investments and financial instruments. Actual results could differ from those estimates, and such differences could be material to the financial statements. |
Principles of Consolidation | Principles of Consolidation The types of entities KKR assesses for consolidation include (i) subsidiaries, including management companies, broker-dealers and general partners of investment funds that KKR manages, (ii) entities that have all the attributes of an investment company, like investment funds, (iii) CFEs and (iv) other entities, including entities that employ non-employee operating consultants. Each of these entities is assessed for consolidation on a case by case basis depending on the specific facts and circumstances surrounding that entity. Pursuant to its consolidation policy, KKR first considers whether an entity is considered a VIE and therefore whether to apply the consolidation guidance under the VIE model. Entities that do not qualify as VIEs are assessed for consolidation as voting interest entities ("VOEs") under the voting interest model. KKR's funds are, for GAAP purposes, investment companies and therefore are not required to consolidate their investments in portfolio companies even if majority-owned and controlled. Rather, the consolidated funds and vehicles reflect their investments at fair value as described below in "Fair Value Measurements." An entity in which KKR holds a variable interest is a VIE if any one of the following conditions exist: (a) the total equity investment at risk is not sufficient to permit the legal entity to finance its activities without additional subordinated financial support, (b) the holders of the equity investment at risk (as a group) lack either the direct or indirect ability through voting rights or similar rights to make decisions about a legal entity's activities that have a significant effect on the success of the legal entity or the obligation to absorb the expected losses or right to receive the expected residual returns, or (c) the voting rights of some investors are disproportionate to their obligation to absorb the expected losses of the legal entity, their rights to receive the expected residual returns of the legal entity, or both and substantially all of the legal entity's activities either involve or are conducted on behalf of an investor with disproportionately few voting rights. Limited partnerships and other similar entities where unaffiliated limited partners have not been granted (i) substantive participatory rights or (ii) substantive rights to either dissolve the partnership or remove the general partner ("kick-out rights") are VIEs under condition (b) above. KKR's investment funds that are not CFEs (i) are generally limited partnerships, (ii) generally provide KKR with operational discretion and control, and (iii) generally have fund investors with no substantive rights to impact ongoing governance and operating activities of the fund, including the ability to remove the general partner, and, as such, the limited partners do not hold kick-out rights. Accordingly, most of KKR's investment funds are categorized as VIEs. KKR consolidates all VIEs in which it is the primary beneficiary. A reporting entity is determined to be the primary beneficiary if it holds a controlling financial interest in a VIE. A controlling financial interest is defined as (a) the power to direct the activities of a VIE that most significantly impact the VIE's economic performance and (b) the obligation to absorb losses of the VIE that could potentially be significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. The consolidation guidance requires an analysis to determine (i) whether an entity in which KKR holds a variable interest is a VIE and (ii) whether KKR's involvement, through holding interests directly or indirectly in the entity or contractually through other variable interests (for example, management and performance related fees), would give it a controlling financial interest. Performance of that analysis requires the exercise of judgment. Fees earned by KKR that are customary and commensurate with the level of effort required to provide those services, and where KKR does not hold other economic interests in the entity that would absorb more than an insignificant amount of the expected losses or returns of the entity, would not be considered variable interests. KKR factors in all economic interests including interests held through related parties, to determine if it holds a variable interest. KKR determines whether it is the primary beneficiary of a VIE at the time it becomes involved with a VIE and reconsiders that conclusion when facts and circumstances change. For entities that are determined not to be VIEs, these entities are generally considered VOEs and are evaluated under the voting interest model. KKR consolidates VOEs it controls through a majority voting interest or through other means. The consolidation assessment, including the determination as to whether an entity qualifies as a VIE or VOE depends on the facts and circumstances surrounding each entity and therefore certain of KKR's investment funds may qualify as VIEs whereas others may qualify as VOEs. With respect to CLOs (which are generally VIEs), in its role as collateral manager, KKR generally has the power to direct the activities of the CLO that most significantly impact the economic performance of the entity. In some, but not all cases, KKR, through its residual interest in the CLO may have variable interests that represent an obligation to absorb losses of, or a right to receive benefits from, the CLO that could potentially be significant to the CLO. In cases where KKR has both the power to direct the activities of the CLO that most significantly impact the CLO's economic performance and the obligation to absorb losses of the CLO or the right to receive benefits from the CLO that could potentially be significant to the CLO, KKR is deemed to be the primary beneficiary and consolidates the CLO. With respect to CMBS vehicles (which are generally VIEs), KKR holds unrated and non-investment grade rated securities issued by the CMBS, which are the most subordinate tranche of the CMBS vehicle. The economic performance of the CMBS is most significantly impacted by the performance of the underlying assets. Thus, the activities that most significantly impact the CMBS economic performance are the activities that most significantly impact the performance of the underlying assets. The special servicer has the ability to manage the CMBS assets that are delinquent or in default to improve the economic performance of the CMBS. KKR generally has the right to unilaterally appoint and remove the special servicer for the CMBS and as such is considered the controlling class of the CMBS vehicle. These rights give KKR the ability to direct the activities that most significantly impact the economic performance of the CMBS. Additionally, as the holder of the most subordinate tranche, KKR is in a first loss position and has the right to receive benefits, including the actual residual returns of the CMBS, if any. In these cases, KKR is deemed to be the primary beneficiary and consolidates the CMBS vehicle. |
Investments | Investments Investments consist primarily of private equity, real assets, credit, investments of consolidated CFEs, equity method, carried interest and other investments. Investments denominated in currencies other than the entity's functional currency are valued based on the spot rate of the respective currency at the end of the reporting period with changes related to exchange rate movements reflected as a component of Net Gains (Losses) from Investment Activities in the consolidated statements of operations. Security and loan transactions are recorded on a trade date basis. Further disclosure on investments is presented in Note 4 "Investments." The following describes the types of securities held within each investment class. Private Equity - Consists primarily of equity investments in operating businesses, including growth equity investments. Credit - Consists primarily of investments in below investment grade corporate debt securities (primarily high yield bonds and syndicated bank loans), originated, distressed and opportunistic debt, real estate mortgage loans, and interests in unconsolidated CLOs. Investments of Consolidated CFEs - Consists primarily of (i) investments in below investment grade corporate debt securities (primarily high yield bonds and syndicated bank loans) held directly by the consolidated CLOs and (ii) investments in originated, fixed-rate real estate mortgage loans held directly by the consolidated CMBS vehicles. Real Assets - Consists primarily of investments in (i) energy related assets, principally oil and natural gas producing properties, (ii) infrastructure assets, and (iii) real estate, principally residential and commercial real estate assets and businesses. Equity Method - Other - Consists primarily of (i) certain direct interests in operating companies in which KKR is deemed to exert significant influence under GAAP and (ii) certain interests in partnerships and joint ventures that hold private equity and real estate investments. Equity Method - Capital Allocation-Based Income - Consists primarily of (i) the capital interest KKR holds as the general partner in certain investment funds, which are not consolidated and (ii) the carried interest component of the general partner interest, which are accounted for as a single unit of account. Other - Consists primarily of investments in common stock, preferred stock, warrants and options of companies that are not private equity, real assets, credit or investments of consolidated CFEs. Investments held by Consolidated Investment Funds The consolidated investment funds are, for GAAP purposes, investment companies and reflect their investments and other financial instruments, including portfolio companies that are majority-owned and controlled by KKR's investment funds, at fair value. KKR has retained this specialized accounting for the consolidated funds in consolidation. Accordingly, the unrealized gains and losses resulting from changes in fair value of the investments and other financial instruments held by the consolidated investment funds are reflected as a component of Net Gains (Losses) from Investment Activities in the consolidated statements of operations. Certain energy investments are made through consolidated investment funds, including investments in working and royalty interests in oil and natural gas producing properties as well as investments in operating companies that operate in the energy industry. Since these investments are held through consolidated investment funds, such investments are reflected at fair value as of the end of the reporting period. Investments in operating companies that are held through KKR's consolidated investment funds are generally classified within private equity investments and investments in working and royalty interests in oil and natural gas producing properties are generally classified as real asset investments. |
Energy Investments held directly by KKR | Energy Investments held by KKR Certain energy investments are made by KKR in working and royalty interests in oil and natural gas producing properties and not through investment funds. Oil and natural gas producing activities are accounted for under the successful efforts method of accounting and such working interests are consolidated based on the proportion of the working interests held by KKR. Accordingly, KKR reflects its proportionate share of the underlying consolidated statements of financial condition and consolidated statements of operations of the consolidated working interests on a gross basis and changes in the value of these working interests are not reflected as unrealized gains and losses in the consolidated statements of operations. Under the successful efforts method, exploration costs, other than the costs of drilling exploratory wells, are charged to expense as incurred. Costs that are associated with the drilling of successful exploration wells are capitalized if proved reserves are found. Lease acquisition costs are capitalized when incurred. Costs associated with the drilling of exploratory wells that do not find proved reserves, geological and geophysical costs and costs of certain nonproducing leasehold costs are charged to expense as incurred. Expenditures for repairs and maintenance, including workovers, are charged to expense as incurred. The capitalized costs of producing oil and natural gas properties are depleted on a field-by-field basis using the units-of production method based on the ratio of current production to estimated total net proved oil, natural gas and natural gas liquid reserves. Proved developed reserves are used in computing depletion rates for drilling and development costs and total proved reserves are used for depletion rates of leasehold costs. Estimated dismantlement and abandonment costs for oil and natural gas properties, net of salvage value, are capitalized at their estimated net present value and amortized on a unit-of-production basis over the remaining life of the related proved developed reserves. Whenever events or changes in circumstances indicate that the carrying amounts of oil and natural gas properties may not be recoverable, KKR evaluates oil and natural gas properties and related equipment and facilities for impairment on a field-by-field basis. The determination of recoverability is made based upon estimated undiscounted future net cash flows. The amount of impairment loss, if any, is determined by comparing the fair value, as determined by a discounted cash flow analysis, with the carrying value of the related asset. Any impairment in value is recognized when incurred and is recorded in General, Administrative, and Other expense in the consolidated statements of operations. |
Fair Value Option | Fair Value Option For certain investments and other financial instruments, KKR has elected the fair value option. Such election is irrevocable and is applied on a financial instrument by financial instrument basis at initial recognition. KKR has elected the fair value option for certain private equity, real assets, credit, investments of consolidated CFEs, equity method - other and other financial instruments not held through a consolidated investment fund. Accounting for these investments at fair value is consistent with how KKR accounts for its investments held through consolidated investment funds. Changes in the fair value of such instruments are recognized in Net Gains (Losses) from Investment Activities in the consolidated statements of operations. Interest income on interest bearing credit securities on which the fair value option has been elected is based on stated coupon rates adjusted for the accretion of purchase discounts and the amortization of purchase premiums. This interest income is recorded within Interest Income in the consolidated statements of operations. |
Equity Method | Equity Method For certain investments in entities over which KKR exercises significant influence but which do not meet the requirements for consolidation and for which KKR has not elected the fair value option, KKR uses the equity method of accounting. The carrying value of equity method investments, for which KKR has not elected the fair value option, is determined based on the amounts invested by KKR, adjusted for the equity in earnings or losses of the investee allocated based on KKR's respective ownership percentage, less distributions. For equity method investments for which KKR has not elected the fair value option, KKR records its proportionate share of the investee's earnings or losses based on the most recently available financial information of the investee, which in certain cases may lag the date of KKR's financial statements by no more than three calendar months. As of March 31, 2019 , equity method investees for which KKR reports financial results on a lag include Marshall Wace LLP ("Marshall Wace"). KKR evaluates its equity method investments for which KKR has not elected the fair value option for impairment whenever events or changes in circumstances indicate that the carrying amounts of such investments may not be recoverable. The carrying value of investments classified as Equity Method - Capital Allocation-Based Income approximates fair value, because the underlying investments of the unconsolidated investment funds are reported at fair value. |
Financial Instruments held by Consolidated CFEs | Financial Instruments held by Consolidated CFEs KKR measures both the financial assets and financial liabilities of the consolidated CFEs in its financial statements using the more observable of the fair value of the financial assets and the fair value of the financial liabilities which results in KKR's consolidated net income (loss) reflecting KKR's own economic interests in the consolidated CFEs including (i) changes in the fair value of the beneficial interests retained by KKR and (ii) beneficial interests that represent compensation for services rendered. For the consolidated CLOs, KKR has determined that the fair value of the financial assets of the consolidated CLOs is more observable than the fair value of the financial liabilities of the consolidated CLOs. As a result, the financial assets of the consolidated CLOs are being measured at fair value and the financial liabilities are being measured in consolidation as: (1) the sum of the fair value of the financial assets and the carrying value of any nonfinancial assets that are incidental to the operations of the CLOs less (2) the sum of the fair value of any beneficial interests retained by KKR (other than those that represent compensation for services) and KKR's carrying value of any beneficial interests that represent compensation for services. The resulting amount is allocated to the individual financial liabilities (other than the beneficial interests retained by KKR). For the consolidated CMBS vehicles, KKR has determined that the fair value of the financial liabilities of the consolidated CMBS vehicles is more observable than the fair value of the financial assets of the consolidated CMBS vehicles. As a result, the financial liabilities of the consolidated CMBS vehicles are being measured at fair value and the financial assets are being measured in consolidation as: (1) the sum of the fair value of the financial liabilities (other than the beneficial interests retained by KKR), the fair value of the beneficial interests retained by KKR and the carrying value of any nonfinancial liabilities that are incidental to the operations of the CMBS vehicles less (2) the carrying value of any nonfinancial assets that are incidental to the operations of the CMBS vehicles. The resulting amount is allocated to the individual financial assets. |
Fair Value Measurements | Fair Value Measurements Fair value is 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 under current market conditions. Except for certain of KKR's equity method investments (see "Equity Method" above) and debt obligations (as described in Note 10 "Debt Obligations"), KKR's investments and other financial instruments are recorded at fair value or at amounts whose carrying values approximate fair value. Where available, fair value is based on observable market prices or parameters or derived from such prices or parameters. Where observable prices or inputs are not available, valuation techniques are applied. These valuation techniques involve varying levels of management estimation and judgment, the degree of which is dependent on a variety of factors. GAAP establishes a hierarchical disclosure framework which prioritizes and ranks the level of market price observability used in measuring financial instruments at fair value. Market price observability is affected by a number of factors, including the type of financial instrument, the characteristics specific to the financial instrument and the state of the marketplace, including the existence and transparency of transactions between market participants. Financial instruments with readily available quoted prices in active markets generally will have a higher degree of market price observability and a lesser degree of judgment used in measuring fair value. Investments and financial instruments measured and reported at fair value are classified and disclosed based on the observability of inputs used in the determination of fair values, as follows: Level I - Pricing inputs are unadjusted, quoted prices in active markets for identical assets or liabilities as of the measurement date. The types of financial instruments included in this category are publicly-listed equities and securities sold short. Level II - Pricing inputs are other than quoted prices in active markets, which are either directly or indirectly observable as of the measurement date, and fair value is determined through the use of models or other valuation methodologies. The types of financial instruments included in this category are credit investments, investments and debt obligations of consolidated CLO entities, convertible debt securities indexed to publicly-listed securities, less liquid and restricted equity securities and certain over-the-counter derivatives such as foreign currency option and forward contracts. Level III - Pricing inputs are unobservable for the financial instruments and include situations where there is little, if any, market activity for the financial instrument. The inputs into the determination of fair value require significant management judgment or estimation. The types of financial instruments generally included in this category are private portfolio companies, real assets investments, credit investments, equity method investments for which the fair value option was elected and investments and debt obligations of consolidated CMBS entities. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the level in the fair value hierarchy within which the fair value measurement in its entirety falls has been determined based on the lowest level input that is significant to the fair value measurement in its entirety. KKR's assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and consideration of factors specific to the asset. A significant decrease in the volume and level of activity for the asset or liability is an indication that transactions or quoted prices may not be representative of fair value because in such market conditions there may be increased instances of transactions that are not orderly. In those circumstances, further analysis of transactions or quoted prices is needed, and a significant adjustment to the transactions or quoted prices may be necessary to estimate fair value. The availability of observable inputs can vary depending on the financial asset or liability and is affected by a wide variety of factors, including, for example, the type of instrument, whether the instrument has recently been issued, whether the instrument is traded on an active exchange or in the secondary market, and current market conditions. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by KKR in determining fair value is greatest for instruments categorized in Level III. The variability and availability of the observable inputs affected by the factors described above may cause transfers between Levels I, II, and III, which KKR recognizes at the beginning of the reporting period. Investments and other financial instruments that have readily observable market prices (such as those traded on a securities exchange) are stated at the last quoted sales price as of the reporting date. KKR does not adjust the quoted price for these investments, even in situations where KKR holds a large position and a sale could reasonably affect the quoted price. Management's determination of fair value is based upon the methodologies and processes described below and may incorporate assumptions that are management's best estimates after consideration of a variety of internal and external factors. Level II Valuation Methodologies Credit Investments: These instruments generally have bid and ask prices that can be observed in the marketplace. Bid prices reflect the highest price that KKR and others are willing to pay for an instrument. Ask prices represent the lowest price that KKR and others are willing to accept for an instrument. For financial assets and liabilities whose inputs are based on bid-ask prices obtained from third party pricing services, fair value may not always be a predetermined point in the bid-ask range. KKR's policy is generally to allow for mid-market pricing and adjusting to the point within the bid-ask range that meets KKR's best estimate of fair value. Investments and Debt Obligations of Consolidated CLO Vehicles: Investments of consolidated CLO vehicles are reported within Investments of Consolidated CFEs and are valued using the same valuation methodology as described above for credit investments. Under ASU 2014-13, KKR measures CLO debt obligations on the basis of the fair value of the financial assets of the CLO. Securities indexed to publicly-listed securities: The securities are typically valued using standard convertible security pricing models. The key inputs into these models that require some amount of judgment are the credit spreads utilized and the volatility assumed. To the extent the company being valued has other outstanding debt securities that are publicly-traded, the implied credit spread on the company's other outstanding debt securities would be utilized in the valuation. To the extent the company being valued does not have other outstanding debt securities that are publicly-traded, the credit spread will be estimated based on the implied credit spreads observed in comparable publicly-traded debt securities. In certain cases, an additional spread will be added to reflect an illiquidity discount due to the fact that the security being valued is not publicly-traded. The volatility assumption is based upon the historically observed volatility of the underlying equity security into which the convertible debt security is convertible and/or the volatility implied by the prices of options on the underlying equity security. Restricted Equity Securities: The valuation of certain equity securities is based on an observable price for an identical security adjusted for the effect of a restriction. Derivatives: The valuation incorporates observable inputs comprising yield curves, foreign currency rates and credit spreads. Level III Valuation Methodologies Investments and financial instruments categorized as Level III consist primarily of the following: Private Equity Investments: KKR generally employs two valuation methodologies when determining the fair value of a private equity investment. The first methodology is typically a market comparables analysis that considers key financial inputs and recent public and private transactions and other available measures. The second methodology utilized is typically a discounted cash flow analysis, which incorporates significant assumptions and judgments. Estimates of key inputs used in this methodology include the weighted average cost of capital for the investment and assumed inputs used to calculate terminal values, such as exit EBITDA multiples. In certain cases the results of the discounted cash flow approach can be significantly impacted by these estimates. Other inputs are also used in both methodologies. In addition, when a definitive agreement has been executed to sell an investment, KKR generally considers a significant determinant of fair value to be the consideration to be received by KKR pursuant to the executed definitive agreement. Upon completion of the valuations conducted using these methodologies, a weighting is ascribed to each method, and an illiquidity discount is typically applied where appropriate. The ultimate fair value recorded for a particular investment will generally be within a range suggested by the two methodologies, except that the value may be higher or lower than such range in the case of investments being sold pursuant to an executed definitive agreement. When determining the weighting ascribed to each valuation methodology, KKR considers, among other factors, the availability of direct market comparables, the applicability of a discounted cash flow analysis, the expected hold period and manner of realization for the investment, and in the case of investments being sold pursuant to an executed definitive agreement, an estimated probability of such sale being completed. These factors can result in different weightings among investments in the portfolio and in certain instances may result in up to a 100% weighting to a single methodology. When an illiquidity discount is to be applied, KKR seeks to take a uniform approach across its portfolio and generally applies a minimum 5% discount to all private equity investments. KKR then evaluates such private equity investments to determine if factors exist that could make it more challenging to monetize the investment and, therefore, justify applying a higher illiquidity discount. These factors generally include (i) whether KKR is unable to freely sell the portfolio company or conduct an initial public offering of the portfolio company due to the consent rights of a third party or similar factors, (ii) whether the portfolio company is undergoing significant restructuring activity or similar factors, and (iii) characteristics about the portfolio company regarding its size and/or whether the portfolio company is experiencing, or expected to experience, a significant decline in earnings. These factors generally make it less likely that a portfolio company would be sold or publicly offered in the near term at a price indicated by using just a market multiples and/or discounted cash flow analysis, and these factors tend to reduce the number of opportunities to sell an investment and/or increase the time horizon over which an investment may be monetized. Depending on the applicability of these factors, KKR determines the amount of any incremental illiquidity discount to be applied above the 5% minimum, and during the time KKR holds the investment, the illiquidity discount may be increased or decreased, from time to time, based on changes to these factors. The amount of illiquidity discount applied at any time requires considerable judgment about what a market participant would consider and is based on the facts and circumstances of each individual investment. Accordingly, the illiquidity discount ultimately considered by a market participant upon the realization of any investment may be higher or lower than that estimated by KKR in its valuations. In the case of growth equity investments, enterprise values may be determined using the market comparables analysis and discounted cash flow analysis described above. A scenario analysis may also be conducted to subject the estimated enterprise values to a downside, base and upside case, which involves significant assumptions and judgments. A milestone analysis may also be conducted to assess the current level of progress towards value drivers that we have determined to be important, which involves significant assumptions and judgments. The enterprise value in each case may then be allocated across the investment's capital structure to reflect the terms of the security and subjected to probability weightings. In certain cases, the values of growth equity investments may be based on recent or expected financings. Real Asset Investments: Real asset investments in infrastructure, energy and real estate are valued using one or more of the discounted cash flow analysis, market comparables analysis and direct income capitalization, which in each case incorporates significant assumptions and judgments. Infrastructure investments are generally valued using the discounted cash flow analysis. Key inputs used in this methodology can include the weighted average cost of capital and assumed inputs used to calculate terminal values, such as exit EBITDA multiples. Energy investments are generally valued using a discounted cash flow approach, and where applicable, a market approach using comparable companies and transactions. Key inputs used in our valuations include (i) the weighted average cost of capital, (ii) future commodity prices, as quoted on indices and long-term commodity price forecasts, and (iii) the asset’s future operating performance. Real estate investments are generally valued using a combination of direct income capitalization and discounted cash flow analysis. Certain real estate investments are valued by KKR based on ranges of valuations determined by an independent valuation firm. Key inputs used in such methodologies that require estimates include an unlevered discount rate and current capitalization rate. The valuations of real assets investments also use other inputs. Credit Investments: Credit investments are valued using values obtained from dealers or market makers, and where these values are not available, credit investments are generally valued by KKR based on ranges of valuations determined by an independent valuation firm. Valuation models are based on discounted cash flow analyses, for which the key inputs are determined based on market comparables, which incorporate similar instruments from similar issuers. Other Investments: With respect to other investments including equity method investments for which the fair value election has been made, KKR generally employs the same valuation methodologies as described above for private equity investments when valuing these other investments. Investments and Debt Obligations of Consolidated CMBS Vehicles: Under ASU 2014-13, KKR measures CMBS investments, which are reported within Investments of Consolidated CFEs on the basis of the fair value of the financial liabilities of the CMBS. Debt obligations of consolidated CMBS vehicles are valued based on discounted cash flow analyses. The key input is the expected yield of each CMBS security using both observable and unobservable factors, which may include recently offered or completed trades and published yields of similar securities, security-specific characteristics (e.g. securities ratings issued by nationally recognized statistical rating organizations, credit support by other subordinate securities issued by the CMBS and coupon type) and other characteristics. Key unobservable inputs that have a significant impact on KKR's Level III investment valuations as described above are included in Note 5 "Fair Value Measurements." KKR utilizes several unobservable pricing inputs and assumptions in determining the fair value of its Level III investments. These unobservable pricing inputs and assumptions may differ by investment and in the application of KKR's valuation methodologies. KKR's reported fair value estimates could vary materially if KKR had chosen to incorporate different unobservable pricing inputs and other assumptions or, for applicable investments, if KKR only used either the discounted cash flow methodology or the market comparables methodology instead of assigning a weighting to both methodologies. |
Fees and Other | Fees and Other Fees and Other, as detailed above, are accounted for as contracts with customers. Under the guidance for contracts with customers, KKR is required to (a) identify the contract(s) with a customer, (b) identify the performance obligations in the contract, (c) determine the transaction price, (d) allocate the transaction price to the performance obligations in the contract, and (e) recognize revenue when (or as) KKR satisfies its performance obligation. In determining the transaction price, KKR has included variable consideration only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized would not occur when the uncertainty associated with the variable consideration is resolved. The following table summarizes KKR's revenues from contracts with customers: Revenue Type Customer Performance Obligation Performance Obligation Satisfied Over Time or Point In Time (1) Variable or Fixed Consideration Payment Terms Subject to Return Once Recognized Classification of Uncollected Amounts (2) Management Fees Investment funds, CLOs and other vehicles Investment management services Over time as services are rendered Variable consideration since varies based on fluctuations in the basis of the management fee over time Typically quarterly or annually in arrears No Due from Affiliates Transaction Fees Portfolio companies and third party companies Advisory services and debt and equity arranging and underwriting Point in time when the transaction (e.g. underwriting) is completed Fixed consideration Typically paid on or shortly after transaction closes No Due from Affiliates (portfolio companies) Other Assets (third parties) Monitoring Fees Recurring Fees Portfolio companies Monitoring services Over time as services are rendered Variable consideration since varies based on fluctuations in the basis of the recurring fee Typically quarterly in arrears No Due from Affiliates Termination Fees Portfolio companies Monitoring services Point in time when the termination is completed Fixed consideration Typically paid on or shortly after termination occurs No Due from Affiliates Incentive Fees Investment funds and other vehicles Investment management services that result in achievement of minimum investment return levels Point in time at the end of the performance measurement period (quarterly or annually) if investment performance is achieved Variable consideration since contingent upon the investment fund and other vehicles achieving more than stipulated investment return hurdles Typically paid shortly after the end of the performance measurement period No Due from Affiliates Expense Reimbursements Investment funds and portfolio companies Investment management and monitoring services Point in time when the related expense is incurred Fixed consideration Typically shortly after expense is incurred No Due from Affiliates Oil and Gas Revenues Oil and gas wholesalers Delivery of oil liquids and gas Point in time when delivery has occurred and title has transferred Fixed consideration Typically shortly after delivery No Other Assets Consulting Fees Portfolio companies and other companies Consulting and other services Over time as services are rendered Fixed consideration Typically quarterly in arrears No Due from Affiliates (1) For performance obligations satisfied at a point in time, there were no significant judgments made in evaluating when a customer obtains control of the promised service. (2) For amounts classified in Other Assets, see Note 8 "Other Assets and Accounts Payable, Accrued Expenses and Other Liabilities." For amounts classified in Due from Affiliates, see Note 13 "Related Party Transactions." Management Fees KKR provides investment management services to investment funds, CLOs, and other vehicles in exchange for a management fee. Management fees are determined quarterly based on an annual rate and are generally based upon a percentage of the capital committed or capital invested during the investment period. Thereafter, management fees are generally based on a percentage of remaining invested capital, net asset value, gross assets or as otherwise defined in the respective contractual agreements. Since some of the factors that cause the fees to fluctuate are outside of KKR's control, management fees are considered to be constrained and are therefore not included in the transaction price. Additionally, after the contract is established there are no significant judgments made when determining the transaction price. Management fees earned from KKR's consolidated investment funds, CLOs, and other vehicles are eliminated in consolidation. However, because these amounts are funded by, and earned from, noncontrolling interests, KKR's allocated share of the net income from the consolidated investment funds, CLOs, and other vehicles is increased by the amount of fees that are eliminated. Accordingly, the elimination of these fees does not impact the net income (loss) attributable to KKR or KKR stockholders' equity. Fee Credits Under the terms of the management agreements with certain of its investment funds, KKR is required to share with such funds an agreed upon percentage of certain fees, including monitoring and transaction fees earned from portfolio companies ("Fee Credits"). Investment funds earn Fee Credits only with respect to monitoring and transaction fees that are allocable to the fund's investment in the portfolio company and not, for example, any fees allocable to capital invested through co-investment vehicles. Fee Credits are calculated after deducting certain costs incurred in connection with pursuing potential investments that do not result in completed transactions ("broken-deal expenses") and generally amount to 80% for older funds, or 100% for newer funds, of allocable monitoring and transaction fees after broken-deal expenses are recovered, although the actual percentage may vary from fund to fund. Fee Credits are recognized and owed to investment funds concurrently with the recognition of monitoring fees, transaction fees and broken-deal expenses. Since Fee Credits are payable to investment funds, amounts owed are generally applied as a reduction of the management fee that is otherwise billed to the investment fund. Fee credits are recorded as a reduction of revenues in the consolidated statement of operations. Fee credits owed to investment funds are recorded in Due to Affiliates on the consolidated statements of financial condition. See Note 13 "Related Party Transactions." Transaction Fees KKR (i) arranges debt and equity financing, places and underwrites securities offerings, and provides other types of capital markets services for companies seeking financing in its Capital Markets business line and (ii) provides advisory services in connection with successful Private Markets and Public Markets portfolio company investment transactions, in each case, in exchange for a transaction fee. Transaction fees are separately negotiated for each transaction and are generally based on (i) in our Capital Markets business line, a percentage of the overall transaction size and (ii) for Private Markets and Public Markets transactions, a percentage of either total enterprise value of an investment or a percentage of the aggregate price paid for an investment. After the contract is established, there are no significant judgments made when determining the transaction price. Monitoring Fees KKR provides services in connection with monitoring portfolio companies in exchange for a fee. Recurring monitoring fees are separately negotiated for each portfolio company. In addition, certain monitoring fee arrangements may provide for a termination payment following an initial public offering or change of control as defined in the contractual terms of the related agreement. These termination payments are recognized in the period when the related transaction closes. After the contract is established, there are no significant judgments made when determining the transaction price. Incentive Fees KKR provides investment management services to certain investment funds, CLOs and other vehicles in exchange for a management fee as discussed above and, in some cases an incentive fee when KKR is not entitled to a carried interest. Incentive fee rates generally range from 5% to 20% of investment gains. Incentive fees are considered a form of variable consideration as these fees are subject to reversal, and therefore the recognition of such fees is deferred until the end of each fund's measurement period (which is generally one year) when the performance-based incentive fees become fixed and determinable. Incentive fees are generally paid within 90 days of the end of the investment vehicles' measurement period. After the contract is established, there are no significant judgments made when determining the transaction price. Expense Reimbursements Providing investment management services to investment funds and monitoring KKR’s portfolio companies require KKR to arrange for services on behalf of them. In those situations where KKR is acting as an agent on behalf of its investment funds or portfolio companies, it presents the cost of services on a net basis as a reduction of Revenues. In all other situations, KKR is primarily responsible for fulfilling the services and is therefore acting as a principal for those arrangements for accounting purposes. As a result, the expense and related reimbursement associated with those services is presented on a gross basis. Costs incurred are classified as Expenses and reimbursements of such costs are classified as Expense Reimbursements within Revenues on the consolidated statements of operations. After the contract is established, there are no significant judgments made when determining the transaction price. Oil and Gas Revenue KKR directly holds certain working and royalty interests in oil and natural gas producing properties that are not held through investment funds. Oil and gas revenue is recognized when the performance obligation is satisfied, which occurs at the point in time when control of the product transfers to the customer. Performance obligations are typically satisfied through the monthly delivery of production. Revenue is recognized based on KKR's proportionate share of production from non-operated properties as marketed by the operator. After the contract is established, there are no significant judgments made when determining the transaction price. Consulting Fees Certain consolidated entities that employ non-employee operating consultants provide consulting and other services to portfolio companies and other companies in exchange for a consulting fee. Consulting fees are separately negotiated with each portfolio company for which services are provided and are not shared with KKR. After the contract is established, there are no significant judgments made when determining the transaction price. Capital Allocation-Based Income Capital allocation-based income is earned from those arrangements where KKR has a general partner capital interest and is entitled to a disproportionate allocation of investment income (referred to hereafter as "carried interest"). KKR accounts for its general partner interests in capital allocation-based arrangements as financial instruments under ASC 323, Investments - Equity Method and Joint Ventures ("ASC 323") since the general partner has significant governance rights in the investment funds in which it invests, which demonstrates significant influence. In accordance with ASC 323, KKR records equity method income based on the proportionate share of the income of the investment fund, including carried interest, assuming the investment fund was liquidated as of each reporting date pursuant to each investment fund's governing agreements. Accordingly, these general partner interests are accounted for outside of the scope of ASC 606. Other arrangements surrounding contractual incentive fees through an advisory contract are separate and distinct and accounted for in accordance with ASC 606. In these incentive fee arrangements, accounted for in accordance with ASC 606, KKR’s economics in the entity do not involve an allocation of capital. See "Incentive Fees" above. Carried interest is allocated to the general partner based on cumulative fund performance to date, and where applicable, subject to a preferred return to the funds' limited partners. At the end of each reporting period, KKR calculates the carried interest that would be due to KKR for each investment fund, pursuant to the fund agreements, as if the fair value of the underlying investments were realized as of such date, irrespective of whether such amounts have been realized. As the fair value of underlying investments varies between reporting periods, it is necessary to make adjustments to amounts recorded as carried interest to reflect either (a) positive performance resulting in an increase in the carried interest allocated to the general partner or (b) negative performance that would cause the amount due to KKR to be less than the amount previously recognized, resulting in a negative adjustment to carried interest allocated to the general partner. In each case, it is necessary to calculate the carried interest on cumulative results compared to the carried interest recorded to date and to make the required positive or negative adjustments. KKR ceases to record negative carried interest allocations once previously recognized carried interest allocations for an investment fund have been fully reversed. KKR is not obligated to make payments for guaranteed returns or hurdles and, therefore, cannot have negative carried interest over the life of an investment fund. Accrued but unpaid carried interest as of the reporting date is reflected in Investments in the consolidated statements of financial condition. |
Income Taxes | Income Taxes KKR & Co. Inc. is a corporation for U.S. federal income tax purposes and thus is subject to U.S. federal, state and local corporate income taxes at the entity level on KKR’s share of net taxable income. In addition, the KKR Group Partnerships and certain of their subsidiaries operate in the United States as partnerships for U.S. federal income tax purposes and as corporate entities in certain non-U.S. jurisdictions. These entities, in some cases, are subject to U.S. state or local income taxes or non-U.S. income taxes. Prior to the Conversion, KKR & Co. L.P.’s investment income and carried interest generally were not subject to U.S. corporate income taxes. Subsequent to the Conversion, all income earned by KKR & Co. Inc. is subject to U.S. corporate income taxes. |
Leases | Leases At contract inception, KKR determines if an arrangement contains a lease by evaluating whether (i) the identified asset has been deployed in the contract explicitly or implicitly and (ii) KKR obtains substantially all of the economic benefits from the use of that underlying asset and directs how and for what purpose the asset is used during the term of the contract. Additionally, at contract inception KKR will evaluate whether the lease is an operating or finance lease. Right-of-use (“ROU”) assets represent KKR’s right to use an underlying asset for the lease term and lease liabilities represent KKR’s obligation to make lease payments arising from the lease. ROU assets and the associated lease liabilities are recognized at the commencement date based on the present value of the future minimum lease payments over the lease term. The discount rate implicit in the lease is generally not readily determinable. Consequently, KKR uses its incremental borrowing rate based on the information available including, but not limited to, collateral assumptions, the term of the lease, and the economic environment in which the lease is denominated at the commencement date in determining the present value of the future lease payments. The ROU assets are recognized as the initial measurement of the lease liabilities plus any initial direct costs and any prepaid lease payments less lease incentives received, if any. The lease terms may include options to extend or terminate the lease which are accounted for when it is reasonably certain that KKR will exercise that option. Operating lease expense is recognized on a straight-line basis over the lease term and is recorded within Occupancy and Related Charges in the accompanying consolidated statements of operations. The ROU assets are included in Other Assets and the lease liabilities are included in Accounts Payable, Accrued Expenses and Other Liabilities in the accompanying consolidated statements of financial condition. See Note 8 "Other Assets and Accounts Payable, Accrued Expenses and Other Liabilities." |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements Adopted in 2019 Leases In February 2016, the FASB issued ASU No. 2016-02, Leases ("ASC 842") which has subsequently been amended. This guidance, among other items: (i) requires recognition of lease assets and lease liabilities for those leases classified as operating leases under previous GAAP, ASC 840; (ii) retains a distinction between finance leases and operating leases; and (iii) includes the classification criteria for distinguishing between finance leases and operating leases that are substantially similar to the classification criteria for distinguishing between capital leases and operating leases under ASC 840. The only material lease activity KKR is engaged in is the leasing of office space where KKR is the lessee under the terms of lease agreements, which have been determined to be operating leases. For operating leases, a lessee is required to: (a) recognize a right-of-use asset and a lease liability, initially measured at the present value of the lease payments, in the consolidated statement of financial condition; (b) recognize a single lease cost, calculated so that the cost of the lease is allocated over the lease term, generally on a straight-line basis, and (c) classify all cash payments within operating activities in the consolidated statement of cash flows. KKR adopted this guidance on the effective date, January 1, 2019, using the modified retrospective approach and electing the "Comparatives Under ASC 840 Approach." The Comparatives Under ASC 840 Approach allows an entity to elect not to recast its comparative periods in the period of adoption when transitioning to ASC 842. In doing so, KKR has provided the disclosures required by ASC 840 for the comparative periods. Additionally, KKR has elected the practical expedient package transition election for all leases. The practical expedient package under the new standard allows an entity not to have to reassess its prior conclusions about lease identification, lease classification and initial direct costs. Upon adoption, KKR recorded ROU assets of $153.3 million and lease liabilities of $162.9 million , resulting in no cumulative-effect adjustment to retained earnings as of January 1, 2019. Premium Amortization on Purchased Callable Debt Securities In March 2017, the FASB issued ASU No. 2017-08, Receivables - Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities ("ASU 2017-08"). This guidance amends the amortization period for certain purchased callable debt securities held at a premium. The guidance requires the premium to be amortized to the earliest call date. The guidance does not require an accounting change for securities held at a discount; the discount continues to be amortized to maturity. ASU 2017-08 is effective for fiscal years and interim periods beginning after December 15, 2018. This guidance has been adopted as of January 1, 2019 and did not have a material impact to KKR. Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income In February 2018, the FASB issued ASU No. 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income ("ASU 2018-02"). Under ASC 740-10-45-15, the effects of changes in tax rates and laws on deferred tax balances are recorded as a component of tax expense for the period in which the law was enacted, even if the assets and liabilities related to items of accumulated other comprehensive income ("OCI"). ASU 2018-02 allows entities to elect to reclassify from accumulated OCI to retained earnings stranded tax effects that relate to the Tax Cuts and Jobs Act, which was enacted in December 2017 (the "2017 Tax Act") from the change in federal tax rate for all items accounted for in OCI. Entities can also elect to reclassify other stranded tax effects that relate to the 2017 Tax Act, but do not directly relate to the change in the federal tax rate. Tax effects that are stranded in OCI for other reasons may not be reclassified. In the period of adoption, entities that elect to reclassify the income tax effects of the 2017 Tax Act from accumulated OCI to retained earnings must disclose that they made such an election. Entities must also disclose a description of other income tax effects related to the 2017 Tax Act that are reclassified from accumulated OCI to retained earnings, if any. The guidance is effective for fiscal periods beginning after December 15, 2018, and interim periods within those fiscal years. This guidance has been adopted as of January 1, 2019 and did not have a material impact to KKR. KKR did not elect to reclassify stranded tax effects that relate to the 2017 Tax Act from accumulated OCI to retained earnings for all items accounted for in OCI. KKR's policy for releasing income tax effects from accumulated OCI is when all related units of account are liquidated, sold or extinguished. Effective on January 1, 2020 Goodwill In January 2017, the FASB issued ASU No. 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. This guidance simplifies the accounting for goodwill impairments by eliminating the second step from the goodwill impairment test. The ASU requires goodwill impairments to be measured on the basis of the fair value of a reporting unit relative to the reporting unit's carrying amount rather than on the basis of the implied amount of goodwill relative to the goodwill balance of the reporting unit. The ASU also (i) clarifies the requirements for excluding and allocating foreign currency translation adjustments to reporting units related to an entity's testing of reporting units for goodwill impairment and (ii) clarifies that an entity should consider income tax effects from any tax deductible goodwill on the carrying amount of the reporting unit when measuring the goodwill impairment loss, if applicable. The guidance is effective for fiscal periods beginning after December 15, 2019. Early adoption is allowed for entities as of January 1, 2017, for annual and any interim impairment tests occurring after January 1, 2017. KKR is currently evaluating the impact of this guidance on the financial statements. Implementation Costs Incurred in a Cloud Computing Arrangement In August 2018, the FASB issued ASU No. 2018-15, which addresses a customer’s accounting for implementation costs incurred in a cloud computing arrangement ("CCA") that is a service contract. The ASU aligns the accounting for costs incurred to implement a CCA that is a service arrangement with the guidance on capitalizing costs associated with developing or obtaining internal-use software. The guidance is effective for fiscal periods beginning after December 15, 2019. Early adoption is permitted and this ASU can be applied on either a retrospective or prospective basis. KKR is currently evaluating the impact of this guidance on the financial statements. |
Noncontrolling Interests | Net income (loss) attributable to each of KKR & Co. Inc. Class A common stockholders and KKR Holdings, with the exception of certain tax assets and liabilities that are directly allocable to KKR & Co. Inc., is attributed based on the percentage of the weighted average KKR Group Partnership Units directly or indirectly held by KKR & Co. Inc. and KKR Holdings, each of which directly or indirectly holds equity of the KKR Group Partnerships. However, primarily because of the (i) contribution of certain expenses borne entirely by KKR Holdings, (ii) the periodic exchange of KKR Holdings units for KKR & Co. Inc. Class A common stock pursuant to the exchange agreement and (iii) the contribution of certain expenses borne entirely by KKR associated with the Equity Incentive Plans, equity allocations shown in the consolidated statement of changes in equity differ from their respective pro rata ownership interests in KKR's net assets. Noncontrolling Interests Noncontrolling interests represent (i) noncontrolling interests in consolidated entities and (ii) noncontrolling interests held by KKR Holdings. Noncontrolling Interests in Consolidated Entities Noncontrolling interests in consolidated entities represent the non-redeemable ownership interests in KKR that are held primarily by: (i) third party fund investors in KKR's consolidated funds and certain other entities; (ii) third parties entitled to up to 1% of the carried interest received by certain general partners of KKR's funds that have made investments on or prior to December 31, 2015; (iii) certain former principals and their designees representing a portion of the carried interest received by the general partners of KKR's private equity funds that was allocated to them with respect to private equity investments made during such former principals' tenure with KKR prior to October 1, 2009; (iv) certain principals and former principals representing all of the capital invested by or on behalf of the general partners of KKR's private equity funds prior to October 1, 2009 and any returns thereon; and (v) third parties in KKR's capital markets business line. Noncontrolling Interests held by KKR Holdings Noncontrolling interests held by KKR Holdings include economic interests held by principals indirectly in the KKR Group Partnership Units. Such principals receive financial benefits from KKR's business in the form of distributions received from KKR Holdings and through their direct and indirect participation in the value of KKR Group Partnership Units held by KKR Holdings. These financial benefits are not paid by KKR & Co. Inc. and are borne by KKR Holdings. |
Redeemable Noncontrolling Interests | Redeemable Noncontrolling Interests Redeemable Noncontrolling Interests represent noncontrolling interests of certain investment funds and vehicles that are subject to periodic redemption by fund investors following the expiration of a specified period of time (typically one year), or may be withdrawn subject to a redemption fee during the period when capital may not be otherwise withdrawn. Fund investors interests subject to redemption as described above are presented as Redeemable Noncontrolling Interests in the accompanying consolidated statements of financial condition and presented as Net Income (Loss) Attributable to Redeemable Noncontrolling Interests in the accompanying consolidated statements of operations. There was no impact to Redeemable Noncontrolling Interests upon Conversion. When redeemable amounts become legally payable to fund investors, they are classified as a liability and included in Accounts Payable, Accrued Expenses and Other Liabilities in the accompanying consolidated statements of financial condition. For all consolidated investment vehicles and funds in which redemption rights have not been granted, noncontrolling interests are presented within Stockholders' Equity in the accompanying consolidated statements of financial condition as noncontrolling interests. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Schedule of fees | For the three months ended March 31, 2019 and 2018 , respectively, revenues consisted of the following: Three Months Ended March 31, 2019 2018 Management Fees $ 188,408 $ 187,727 Fee Credits (103,477 ) (29,053 ) Transaction Fees 188,203 158,653 Monitoring Fees 25,651 17,586 Incentive Fees — 13,805 Expense Reimbursements 44,060 20,211 Oil and Gas Revenue 13,175 14,507 Consulting Fees 16,528 10,958 Total Fees and Other 372,548 394,394 Carried Interest 694,383 62,747 General Partner Capital Interest 120,549 15,465 Total Capital Allocation-Based Income 814,932 78,212 Total Revenues $ 1,187,480 $ 472,606 |
NET GAINS (LOSSES) FROM INVES_2
NET GAINS (LOSSES) FROM INVESTMENT ACTIVITIES (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of total net gains (losses) from investment activities | The following table summarizes total Net Gains (Losses) from Investment Activities: Three Months Ended Three Months Ended Net Realized Net Unrealized Total Net Realized Net Unrealized Total Private Equity (1) $ 68,568 $ 919,625 $ 988,193 $ 16,253 $ 158,369 $ 174,622 Credit (1) (17,876 ) 8,669 (9,207 ) 1,263 58,150 59,413 Investments of Consolidated CFEs (1) (10,530 ) 233,357 222,827 (26,516 ) (48,403 ) (74,919 ) Real Assets (1) 29,547 89,581 119,128 12,957 59,297 72,254 Equity Method - Other (1) 20,133 156,906 177,039 9,210 135,604 144,814 Other Investments (1) 1,450 (30,361 ) (28,911 ) (244,199 ) 86,365 (157,834 ) Foreign Exchange Forward Contracts and Options (2) 25,454 54,789 80,243 (32,614 ) (63,118 ) (95,732 ) Securities Sold Short (2) 14,426 (80,772 ) (66,346 ) 275,949 (29,874 ) 246,075 Other Derivatives (2) 1,465 (13,405 ) (11,940 ) 3,642 (8,223 ) (4,581 ) Debt Obligations and Other (3) (2,856 ) (264,292 ) (267,148 ) 14,435 94,253 108,688 Net Gains (Losses) From Investment Activities $ 129,781 $ 1,074,097 $ 1,203,878 $ 30,380 $ 442,420 $ 472,800 (1) See Note 4 "Investments." (2) See Note 8 "Other Assets and Accounts Payable, Accrued Expenses and Other Liabilities." (3) See Note 10 "Debt Obligations." |
INVESTMENTS (Tables)
INVESTMENTS (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Investments [Abstract] | |
Summary of investments | Investments consist of the following: March 31, 2019 December 31, 2018 Private Equity $ 8,522,282 $ 7,349,559 Credit 7,649,787 9,099,135 Investments of Consolidated CFEs 15,021,345 14,733,423 Real Assets 3,213,813 3,157,954 Equity Method - Other 4,472,692 4,212,874 Equity Method - Capital Allocation-Based Income 4,203,980 3,584,415 Other Investments 2,711,355 2,770,622 Total Investments $ 45,795,254 $ 44,907,982 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Schedule of assets and liabilities at fair value | The following tables summarize the valuation of assets and liabilities measured and reported at fair value by the fair value hierarchy. Investments classified as Equity Method - Other, for which the fair value option has not been elected, and Equity Method - Capital Allocation-Based Income have been excluded from the tables below. Assets, at fair value: March 31, 2019 Level I Level II Level III Total Private Equity $ 1,603,803 $ 86,933 $ 6,831,546 $ 8,522,282 Credit — 1,119,308 6,530,479 7,649,787 Investments of Consolidated CFEs — 12,937,610 2,083,735 15,021,345 Real Assets — — 3,213,813 3,213,813 Equity Method - Other 219,566 47,938 1,650,179 1,917,683 Other Investments 501,523 145,882 2,063,950 2,711,355 Total Investments 2,324,892 14,337,671 22,373,702 39,036,265 Foreign Exchange Contracts and Options — 205,900 — 205,900 Other Derivatives — 1,786 31,134 (1) 32,920 Total Assets $ 2,324,892 $ 14,545,357 $ 22,404,836 $ 39,275,085 December 31, 2018 Level I Level II Level III Total Private Equity $ 1,156,977 $ 63,999 $ 6,128,583 $ 7,349,559 Credit — 2,334,405 6,764,730 9,099,135 Investments of Consolidated CFEs — 12,650,878 2,082,545 14,733,423 Real Assets — — 3,157,954 3,157,954 Equity Method - Other 245,225 43,943 1,503,022 1,792,190 Other Investments 480,192 173,844 2,116,586 2,770,622 Total Investments 1,882,394 15,267,069 21,753,420 38,902,883 Foreign Exchange Contracts and Options — 177,264 — 177,264 Other Derivatives — 3,879 37,116 (1) 40,995 Total Assets $ 1,882,394 $ 15,448,212 $ 21,790,536 $ 39,121,142 (1) Includes derivative assets that were valued using a third-party valuation firm. The approach used to estimate the fair value of these derivative assets was generally the discounted cash flow method, which includes consideration of the current portfolio, projected portfolio construction, projected portfolio realizations, portfolio volatility (based on the volatility, correlation, and size of each underlying asset class), and the discounting of future cash flows to the reporting date. Liabilities, at fair value: March 31, 2019 Level I Level II Level III Total Securities Sold Short $ 582,608 $ — $ — $ 582,608 Foreign Exchange Contracts and Options — 17,200 — 17,200 Unfunded Revolver Commitments — — 56,792 (1) 56,792 Other Derivatives — 23,769 17,200 (2) 40,969 Debt Obligations of Consolidated CFEs — 12,557,821 1,914,571 14,472,392 Total Liabilities $ 582,608 $ 12,598,790 $ 1,988,563 $ 15,169,961 December 31, 2018 Level I Level II Level III Total Securities Sold Short $ 344,124 $ — $ — $ 344,124 Foreign Exchange Contracts and Options — 60,749 — 60,749 Unfunded Revolver Commitments — — 52,066 (1) 52,066 Other Derivatives — 18,440 17,200 (2) 35,640 Debt Obligations of Consolidated CFEs — 12,081,771 1,876,783 13,958,554 Total Liabilities $ 344,124 $ 12,160,960 $ 1,946,049 $ 14,451,133 (1) These unfunded revolver commitments are classified as Level III within the fair value hierarchy and valued using the same valuation methodologies as KKR's Level III credit investments. (2) Includes options issued in connection with the acquisition of the equity interest in Marshall Wace and its affiliates in November 2015 to increase KKR's ownership interest in periodic increments. The options are valued using a Monte-Carlo simulation valuation methodology. Key inputs used in this methodology that require estimates include Marshall Wace's dividend yield, assets under management volatility and equity volatility. See Note 4 "Investments." |
Summary of changes in assets and liabilities reported at fair value for which Level III inputs have been used to determine fair value | The following tables summarize changes in investments and debt obligations measured and reported at fair value for which Level III inputs have been used to determine fair value for the three months ended March 31, 2019 and 2018, respectively: For the Three Months Ended March 31, 2019 Level III Investments Level III Debt Obligations Private Equity Credit Investments of Consolidated CFEs Real Assets Equity Method - Other Other Investments Total Debt Obligations of Consolidated CFEs Balance, Beg. of Period $ 6,128,583 $ 6,764,730 $ 2,082,545 $ 3,157,954 $ 1,503,022 $ 2,116,586 $ 21,753,420 $ 1,876,783 Transfers In / (Out) Due to Changes in Consolidation — (1,598 ) — — — (42,864 ) (44,462 ) — Transfers In — — — — — — — — Transfers Out (56,029 ) — — — — — (56,029 ) — Asset Purchases / Debt Issuances 409,621 811,957 — 67,302 137,909 95,135 1,521,924 — Sales / Paydowns (99,603 ) (1,028,063 ) (38,295 ) (130,571 ) (41,126 ) (27,433 ) (1,365,091 ) — Settlements — 20,815 — — — — 20,815 (2,731 ) Net Realized Gains (Losses) 68,568 (15,198 ) — 29,547 11,626 2,121 96,664 — Net Unrealized Gains (Losses) 380,406 (24,806 ) 39,485 89,581 38,748 (79,595 ) 443,819 40,519 Change in Other Comprehensive Income — 2,642 — — — — 2,642 — Balance, End of Period $ 6,831,546 $ 6,530,479 $ 2,083,735 $ 3,213,813 $ 1,650,179 $ 2,063,950 $ 22,373,702 $ 1,914,571 Changes in Net Unrealized Gains (Losses) Included in Net Gains (Losses) from Investment Activities related to Level III Assets and Liabilities still held as of the Reporting Date $ 442,672 $ (31,282 ) $ 39,485 $ 92,900 $ 49,140 $ (79,347 ) $ 513,568 $ 40,519 For the Three Months Ended March 31, 2018 Level III Investments Level III Private Equity Credit Investments of Consolidated CFEs Real Assets Equity Method - Other Other Investments Total Debt Obligations of Consolidated CFEs Balance, Beg. of Period $ 2,172,290 $ 5,138,937 $ 5,353,090 $ 2,251,267 $ 1,076,709 $ 1,760,011 $ 17,752,304 $ 5,238,236 Transfers In / (Out) Due to Changes in Consolidation — — — — — — — — Transfers In — — — — — — — — Transfers Out — — — — — — — — Asset Purchases / Debt Issuances 727,626 890,113 — 540,898 2,037 64,757 2,225,431 — Sales / Paydowns (35,245 ) (230,144 ) (11,541 ) (34,237 ) (31,939 ) (36,218 ) (379,324 ) — Settlements — (53,825 ) — — — — (53,825 ) (11,541 ) Net Realized Gains (Losses) 15,312 11,581 — 8,354 9,348 8,892 53,487 — Net Unrealized Gains (Losses) 208,428 77,715 (83,150 ) 61,151 29,570 3,762 297,476 (88,528 ) Change in Other Comprehensive Income — (15,522 ) — — — — (15,522 ) — Balance, End of Period $ 3,088,411 $ 5,818,855 $ 5,258,399 $ 2,827,433 $ 1,085,725 $ 1,801,204 $ 19,880,027 $ 5,138,167 Changes in Net Unrealized Gains (Losses) Included in Net Gains (Losses) from Investment Activities related to Level III Assets and Liabilities still held as of the Reporting Date $ 208,428 $ 86,754 $ (83,150 ) $ 61,151 $ 34,928 $ 10,442 $ 318,553 $ (88,528 ) |
Summary of valuation methodologies used for assets, measured at fair value and categorized within Level III | The following table presents additional information about valuation methodologies and significant unobservable inputs used for investments and debt obligations that are measured and reported at fair value and categorized within Level III as of March 31, 2019 : Fair Value March 31, 2019 Valuation Methodologies Unobservable Input(s) (1) Weighted Average (2) Range Impact to Valuation from an Increase in Input (3) Private Equity $ 6,831,546 Private Equity $ 4,322,213 Inputs to market comparables and discounted cash flow and transaction price Illiquidity Discount 6.1% 5.0% - 15.0% Decrease Weight Ascribed to Market Comparables 30.5% 0.0% - 50.0% (4) Weight Ascribed to Discounted Cash Flow 69.4% 0.0% - 100.0% (5) Weight Ascribed to Transaction Price 0.1% 0.0% - 100.0% (6) Market comparables Enterprise Value/LTM EBITDA Multiple 14.2x 6.9x - 23.7x Increase Enterprise Value/Forward EBITDA Multiple 12.4x 6.2x - 17.2x Increase Discounted cash flow Weighted Average Cost of Capital 10.7% 5.6% - 14.6% Decrease Enterprise Value/LTM EBITDA Exit Multiple 12.4x 6.0x - 15.0x Increase Growth Equity $ 2,509,333 Inputs to market comparables, discounted cash flow and milestones Illiquidity Discount 11.6% 5.0% - 20.0% Decrease Weight Ascribed to Market Comparables 35.2% 0.0% - 100.0% (4) Weight Ascribed to Discounted Cash Flow 15.3% 0.0% - 75.0% (5) Weight Ascribed to Milestones 49.5% 0.0% - 100.0% (6) Scenario Weighting Base 61.4% 40.0% - 80.0% Increase Downside 16.0% 5.0% - 30.0% Decrease Upside 22.6% 10.0% - 45.0% Increase Credit $ 6,530,479 Yield Analysis Yield 7.6% 3.5% - 23.4% Decrease Net Leverage 2.1x 0.2x - 14.1x Decrease EBITDA Multiple 9.7x 0.2x - 38.2x Increase Investments of Consolidated CFEs $ 2,083,735 (9) Debt Obligations of Consolidated CFEs $ 1,914,571 Discounted cash flow Yield 5.8% 2.6% - 15.5% Decrease Real Assets $ 3,213,813 (10) Energy $ 1,711,998 Discounted cash flow Weighted Average Cost of Capital 10.6% 9.5% - 14.1% Decrease Average Price Per BOE (8) $44.62 $38.98 - $47.75 Increase Real Estate $ 1,294,181 Inputs to direct income capitalization and discounted cash flow Weight Ascribed to Direct Income Capitalization 32.2% 0.0% - 100.0% (7) Weight Ascribed to Discounted Cash Flow 67.8% 0.0% - 100.0% (5) Direct income capitalization Current Capitalization Rate 5.9% 0.4% - 9.5% Decrease Discounted cash flow Unlevered Discount Rate 8.0% 4.8% - 18.0% Decrease Equity Method - Other $ 1,650,179 Inputs to market comparables, discounted cash flow and transaction price Illiquidity Discount 9.5% 5.0% - 15.0% Decrease Weight Ascribed to Market Comparables 42.6% 0.0% - 75.0% (4) Weight Ascribed to Discounted Cash Flow 39.4% 0.0% - 100.0% (5) Weight Ascribed to Transaction Price 18.0% 0.0% - 100.0% (6) Market comparables Enterprise Value/LTM EBITDA Multiple 12.0x 6.9x - 15.2x Increase Enterprise Value/Forward EBITDA Multiple 11.2x 6.2x - 13.2x Increase Discounted cash flow Weighted Average Cost of Capital 9.0% 5.6% - 13.0% Decrease Enterprise Value/LTM EBITDA Exit Multiple 10.4x 6.0x - 12.5x Increase Fair Value March 31, 2019 Valuation Methodologies Unobservable Input(s) (1) Weighted Average (2) Range Impact to Valuation from an Increase in Input (3) Other Investments $ 2,063,950 (11) Inputs to market comparables, discounted cash flow and transaction price Illiquidity Discount 10.2% 5.0% - 20.0% Decrease Weight Ascribed to Market Comparables 38.1% 0.0% - 100.0% (4) Weight Ascribed to Discounted Cash Flow 36.1% 0.0% - 100.0% (5) Weight Ascribed to Transaction Price 25.8% 0.0% - 100.0% (6) Market comparables Enterprise Value/LTM EBITDA Multiple 10.3x 1.3x - 14.6x Increase Enterprise Value/Forward EBITDA Multiple 9.1x 1.2x - 11.7x Increase Discounted cash flow Weighted Average Cost of Capital 17.2% 7.3% - 31.1% Decrease Enterprise Value/LTM EBITDA Exit Multiple 8.9x 6.5x - 9.1x Increase (1) In determining certain of these inputs, management evaluates a variety of factors including economic conditions, industry and market developments, market valuations of comparable companies and company specific developments including exit strategies and realization opportunities. Management has determined that market participants would take these inputs into account when valuing the investments and debt obligations. LTM means last twelve months and EBITDA means earnings before interest, taxes, depreciation and amortization. (2) Inputs were weighted based on the fair value of the investments included in the range. (3) Unless otherwise noted, this column represents the directional change in the fair value of the Level III investments that would result from an increase to the corresponding unobservable input. A decrease to the unobservable input would have the opposite effect. Significant increases and decreases in these inputs in isolation could result in significantly higher or lower fair value measurements. (4) The directional change from an increase in the weight ascribed to the market comparables approach would increase the fair value of the Level III investments if the market comparables approach results in a higher valuation than the discounted cash flow approach and transaction price. The opposite would be true if the market comparables approach results in a lower valuation than the discounted cash flow approach and transaction price. (5) The directional change from an increase in the weight ascribed to the discounted cash flow approach would increase the fair value of the Level III investments if the discounted cash flow approach results in a higher valuation than the market comparables approach, transaction price and direct income capitalization approach. The opposite would be true if the discounted cash flow approach results in a lower valuation than the market comparables approach, transaction price and direct income capitalization approach. (6) The directional change from an increase in the weight ascribed to the transaction price or milestones would increase the fair value of the Level III investments if the transaction price or milestones results in a higher valuation than the market comparables and discounted cash flow approach. The opposite would be true if the transaction price or milestones results in a lower valuation than the market comparables approach and discounted cash flow approach. (7) The directional change from an increase in the weight ascribed to the direct income capitalization approach would increase the fair value of the Level III investments if the direct income capitalization approach results in a higher valuation than the discounted cash flow approach. The opposite would be true if the direct income capitalization approach results in a lower valuation than the discounted cash flow approach. (8) The total energy fair value amount includes multiple investments (in multiple locations throughout North America) that are held in multiple investment funds and produce varying quantities of oil, condensate, natural gas liquids, and natural gas. Commodity price may be measured using a common volumetric equivalent where one barrel of oil equivalent ("BOE"), is determined using the ratio of six thousand cubic feet of natural gas to one barrel of oil, condensate or natural gas liquids. The price per BOE is provided to show the aggregate of all price inputs for the various investments over a common volumetric equivalent although the valuations for specific investments may use price inputs specific to the asset for purposes of our valuations. The discounted cash flows include forecasted production of liquids (oil, condensate, and natural gas liquids) and natural gas with a forecasted revenue ratio of approximately 88% liquids and 12% natural gas. (9) KKR measures CMBS investments on the basis of the fair value of the financial liabilities of the CMBS vehicle. See Note 2 "Summary of Significant Accounting Policies." (10) Includes one Infrastructure investment for $207.6 million that was valued using a discounted cash flow analysis. The significant inputs used included the weighted average cost of capital 6.8% and the enterprise value/LTM EBITDA Exit Multiple 10.0 x. (11) Consists primarily of investments in common stock, preferred stock, warrants and options of companies that are not private equity, real assets, credit, equity method - other or investments of consolidated CFEs. |
FAIR VALUE OPTION (Tables)
FAIR VALUE OPTION (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Summary of disclosures of financial instruments for which the fair value option was elected | The following table summarizes the financial instruments for which the fair value option has been elected: March 31, 2019 December 31, 2018 Assets Private Equity $ 3,235 $ 2,977 Credit 4,519,000 4,950,819 Investments of Consolidated CFEs 15,021,345 14,733,423 Real Assets 309,105 310,399 Equity Method - Other 1,917,683 1,792,190 Other Investments 225,867 235,012 Total $ 21,996,235 $ 22,024,820 Liabilities Debt Obligations of Consolidated CFEs $ 14,472,392 $ 13,958,554 Total $ 14,472,392 $ 13,958,554 The following table presents the net realized and net unrealized gains (losses) on financial instruments for which the fair value option was elected: Three Months Ended Three Months Ended Net Realized Net Unrealized Gains (Losses) Total Net Realized Net Unrealized Gains (Losses) Total Assets Private Equity $ — $ 194 $ 194 $ 71 $ 316 $ 387 Credit (23,153 ) 20,942 (2,211 ) (28,867 ) 2,656 (26,211 ) Investments of Consolidated CFEs (10,530 ) 233,357 222,827 (26,516 ) (48,403 ) (74,919 ) Real Assets 703 2,436 3,139 428 (3,483 ) (3,055 ) Equity Method - Other 11,626 17,084 28,710 9,348 66,093 75,441 Other Investments 1,794 3,987 5,781 4,607 (7,878 ) (3,271 ) Total $ (19,560 ) $ 278,000 $ 258,440 $ (40,929 ) $ 9,301 $ (31,628 ) Liabilities Debt Obligations of Consolidated CFEs — (252,281 ) (252,281 ) 13,256 93,654 106,910 Total $ — $ (252,281 ) $ (252,281 ) $ 13,256 $ 93,654 $ 106,910 |
NET INCOME (LOSS) ATTRIBUTABL_2
NET INCOME (LOSS) ATTRIBUTABLE TO KKR & CO. INC. PER SHARE OF CLASS A COMMON STOCK (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of basic and diluted Net Income (Loss) attributable to KKR & Co. per share of Class A common stock | For the three months ended March 31, 2019 and 2018 , basic and diluted Net Income (Loss) attributable to KKR & Co. Inc. per share of Class A common stock were calculated as follows: Three Months Ended March 31, 2019 2018 Net Income (Loss) Attributable to KKR & Co. Inc. Class A Common Stockholders $ 700,978 $ 170,102 Excess of carrying value over consideration transferred on redemption of KFN 7.375% Series A LLC Preferred Shares — 3,102 Net Income (Loss) Available to KKR & Co. Inc. Class A Common Stockholders $ 700,978 $ 173,204 Basic Net Income (Loss) Per Share of Class A Common Stock Weighted Average Shares of Class A Common Stock Outstanding - Basic 533,892,474 487,704,838 Net Income (Loss) Attributable to KKR & Co. Inc. Per Share of Class A Common Stock - Basic $ 1.31 $ 0.36 Diluted Net Income (Loss) Per Share of Class A Common Stock Weighted Average Shares of Class A Common Stock Outstanding - Basic 533,892,474 487,704,838 Weighted Average Unvested Shares of Class A Common Stock and Other Exchangeable Securities 16,153,966 48,213,436 Weighted Average Shares of Class A Common Stock Outstanding - Diluted 550,046,440 535,918,274 Net Income (Loss) Attributable to KKR & Co. Inc. Per Share of Class A Common Stock - Diluted $ 1.27 $ 0.32 |
Schedule of KKR Holdings shares excluded from the calculation of diluted Net Income (Loss) attributable to KKR & Co. L.P. per share of Class A Common Stock - Diluted | Three Months Ended March 31, 2019 2018 Weighted Average KKR Holdings Units 298,858,418 335,016,218 |
OTHER ASSETS AND ACCOUNTS PAY_2
OTHER ASSETS AND ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER LIABILITIES (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
OTHER ASSETS AND ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER LIABILITIES | |
Schedule of other assets | Other Assets consist of the following: March 31, 2019 December 31, 2018 Unsettled Investment Sales (1) $ 129,141 $ 101,789 Receivables 64,802 27,258 Due from Broker (2) 485,127 396,512 Oil & Gas Assets, net (3) 210,865 225,256 Deferred Tax Assets, net 408,148 538,161 Interest Receivable 231,445 241,547 Fixed Assets, net (4) 466,264 451,206 Foreign Exchange Contracts and Options (5) 205,900 177,264 Intangible Assets, net (6) 9,125 9,863 Goodwill (7) 83,500 83,500 Derivative Assets 32,920 40,995 Deposits 7,284 7,299 Prepaid Taxes 73,054 69,165 Prepaid Expenses 27,106 23,551 Operating Lease Right of Use Assets (8) 146,165 — Deferred Financing Costs 13,458 13,871 Other 93,498 129,455 Total $ 2,687,802 $ 2,536,692 (1) Represents amounts due from third parties for investments sold for which cash settlement has not occurred. (2) Represents amounts held at clearing brokers resulting from securities transactions. (3) Includes proved and unproved oil and natural gas properties under the successful efforts method of accounting, which is net of impairment write-downs, accumulated depreciation, depletion and amortization. Depreciation, depletion and amortization amounted to $13.8 million and $7.1 million for the three months ended March 31, 2019 and 2018, respectively. (4) Net of accumulated depreciation and amortization of $118.0 million and $113.5 million as of March 31, 2019 and December 31, 2018, respectively. Depreciation and amortization expense of $4.4 million and $3.7 million for the three months ended March 31, 2019 and 2018, respectively, is included in General, Administrative and Other in the accompanying consolidated statements of operations. (5) Represents derivative financial instruments used to manage foreign exchange risk arising from certain foreign currency denominated investments. Such instruments are measured at fair value with changes in fair value recorded in Net Gains (Losses) from Investment Activities in the accompanying consolidated statements of operations. See Note 3 "Net Gains (Losses) from Investment Activities" for the net changes in fair value associated with these instruments. (6) Net of accumulated amortization of $63.5 million as of March 31, 2019 and December 31, 2018. Amortization expense of $0.5 million and $5.0 million for the three months ended March 31, 2019 and 2018, respectively, is included in General, Administrative and Other in the accompanying consolidated statements of operations. (7) As of March 31, 2019 , the carrying value of goodwill is recorded and assessed for impairment at the reporting unit. (8) KKR’s non-cancelable operating leases consist of leases for office space around the world. KKR is the lessee under the terms of the operating leases. For the three months ended March 31, 2019, the operating lease cost was $11.8 million . |
Schedule of accounts payable, accrued expenses and other liabilities | Accounts Payable, Accrued Expenses and Other Liabilities consist of the following: March 31, 2019 December 31, 2018 Amounts Payable to Carry Pool (1) $ 1,089,045 $ 922,977 Unsettled Investment Purchases (2) 507,731 541,165 Securities Sold Short (3) 582,608 344,124 Derivative Liabilities 40,969 35,640 Accrued Compensation and Benefits 166,294 107,887 Interest Payable 216,348 212,969 Foreign Exchange Contracts and Options (4) 17,200 60,749 Accounts Payable and Accrued Expenses 108,170 130,554 Taxes Payable 55,355 24,453 Uncertain Tax Positions 67,374 66,775 Unfunded Revolver Commitments 56,792 52,066 Operating Lease Liabilities (5) 152,073 — Other Liabilities 219,069 244,631 Total $ 3,279,028 $ 2,743,990 (1) Represents the amount of carried interest payable to principals, professionals and other individuals with respect to KKR's active funds and co-investment vehicles that provide for carried interest. (2) Represents amounts owed to third parties for investment purchases for which cash settlement has not occurred. (3) Represents the obligations of KKR to deliver a specified security at a future point in time. Such securities are measured at fair value with changes in fair value recorded in Net Gains (Losses) from Investment Activities in the accompanying consolidated statements of operations. See Note 3 "Net Gains (Losses) from Investment Activities" for the net changes in fair value associated with these instruments. (4) Represents derivative financial instruments used to manage foreign exchange risk arising from certain foreign currency denominated investments. Such instruments are measured at fair value with changes in fair value recorded in Net Gains (Losses) from Investment Activities in the accompanying consolidated statements of operations. See Note 3 "Net Gains (Losses) from Investment Activities" for the net changes in fair value associated with these instruments. (5) KKR’s operating leases have remaining lease terms that range from one year to 14 years, some of which include options to extend the leases for up to three years. For the three months ended March 31, 2019 , the weighted average remaining lease term and weighted average discount rate were 4.78 years and 2.64% , respectively. |
VARIABLE INTEREST ENTITIES (Tab
VARIABLE INTEREST ENTITIES (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of maximum exposure to loss, before allocations to the carry pool, if any, for those VIEs in which entity is determined not to be the primary beneficiary but in which it has a variable interest | As of March 31, 2019 and December 31, 2018, the maximum exposure to loss, before allocations to the carry pool and noncontrolling interests, if any, for those VIEs in which KKR is determined not to be the primary beneficiary but in which it has a variable interest is as follows: March 31, 2019 December 31, 2018 Investments $ 4,203,980 $ 3,610,502 Due from (to) Affiliates, net 490,990 410,489 Maximum Exposure to Loss $ 4,694,970 $ 4,020,991 |
DEBT OBLIGATIONS (Tables)
DEBT OBLIGATIONS (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of borrowings | KKR's borrowings consisted of the following: March 31, 2019 December 31, 2018 Financing Available Borrowing Outstanding Fair Value Financing Available Borrowing Outstanding Fair Value Revolving Credit Facilities: Corporate Credit Agreement $ 1,000,000 $ — $ — $ 1,000,000 $ — $ — KCM Credit Agreement 434,395 — — 451,338 — — KCM Short-Term Credit Agreement 750,000 — — 750,000 — — Notes Issued: KKR Issued 6.375% Notes Due 2020 (1) — 499,122 523,900 (14) — 498,975 523,500 (14) KKR Issued 5.500% Notes Due 2043 (2) — 491,921 537,235 (14) — 491,836 508,615 (14) KKR Issued 5.125% Notes Due 2044 (3) — 990,831 1,030,140 (14) — 990,740 974,320 (14) KKR Issued 0.509% Notes Due 2023 (4) — 224,386 223,695 (14) — 226,895 227,298 (14) KKR Issued 0.764% Notes Due 2025 (5) — 44,435 45,402 (14) — 44,923 45,161 (14) KKR Issued 1.595% Notes Due 2038 (6) — 91,767 96,510 (14) — 92,817 94,568 (14) KFN Issued 5.500% Notes Due 2032 (7) — 493,689 502,524 — 493,568 496,359 KFN Issued 5.200% Notes Due 2033 (8) — 118,321 117,152 — 118,291 115,582 KFN Issued 5.400% Notes Due 2033 (9) — 68,705 69,689 — 68,683 68,780 KFN Issued Junior Subordinated Notes (10) — 232,471 197,478 — 232,142 203,135 Other Debt Obligations: Financing Facilities of Consolidated Funds and Other (11) 4,216,970 4,534,329 4,534,329 3,840,877 5,123,768 5,123,768 CLO Senior Secured Notes (12) — 12,155,621 12,155,621 — 11,667,970 11,667,970 CLO Subordinated Notes (12) — 402,200 402,200 — 413,801 413,801 CMBS Debt Obligations (13) — 1,914,571 1,914,571 — 1,876,783 1,876,783 $ 6,401,365 $ 22,262,369 $ 22,350,446 $ 6,042,215 $ 22,341,192 $ 22,339,640 (1) $500 million aggregate principal amount of 6.375% senior notes of KKR due 2020. Borrowing outstanding is presented net of (i) unamortized note discount and (ii) unamortized debt issuance costs of $0.6 million and $0.7 million as of March 31, 2019 and December 31, 2018 , respectively. (2) $500 million aggregate principal amount of 5.500% senior notes of KKR due 2043. Borrowing outstanding is presented net of (i) unamortized note discount and (ii) unamortized debt issuance costs of $3.5 million and $3.6 million as of March 31, 2019 and December 31, 2018 , respectively. (3) $1.0 billion aggregate principal amount of 5.125% senior notes of KKR due 2044. Borrowing outstanding is presented net of (i) unamortized note discount (net of premium) and (ii) unamortized debt issuance costs of $7.9 million and $8.0 million as of March 31, 2019 and December 31, 2018 , respectively. (4) ¥25 billion (or $225.6 million ) aggregate principal amount of 0.509% senior notes of KKR due 2023. Borrowing outstanding is presented net of unamortized debt issuance costs of $1.2 million and $1.3 million as of March 31, 2019 and December 31, 2018 , respectively. These senior notes are denominated in Japanese Yen ("JPY"). (5) ¥5.0 billion (or $45.1 million ) aggregate principal amount of 0.764% senior notes of KKR due 2025. Borrowing outstanding is presented net of unamortized debt issuance costs of $0.7 million and $0.7 million as of March 31, 2019 and December 31, 2018 , respectively. These senior notes are denominated in JPY. (6) ¥10.3 billion (or $92.9 million ) aggregate principal amount of 1.595% senior notes of KKR due 2038. Borrowing outstanding is presented net of unamortized debt issuance costs of $1.2 million and $1.2 million as of March 31, 2019 and December 31, 2018 , respectively. These senior notes are denominated in JPY. (7) KKR consolidates KFN and thus reports KFN's outstanding $500.0 million aggregate principal amount of 5.500% senior notes due 2032. Borrowing outstanding is presented net of (i) unamortized note discount and (ii) unamortized debt issuance costs of $4.3 million and $4.4 million as of March 31, 2019 and December 31, 2018 , respectively. These debt obligations are classified as Level III within the fair value hierarchy and valued using the same valuation methodologies as KKR's Level III credit investments. (8) KKR consolidates KFN and thus reports KFN's outstanding $120.0 million aggregate principal amount of 5.200% senior notes due 2033. Borrowing outstanding is presented net of unamortized debt issuance costs of $1.7 million and $1.7 million as of March 31, 2019 and December 31, 2018 , respectively. These debt obligations are classified as Level III within the fair value hierarchy and valued using the same valuation methodologies as KKR's Level III credit investments. (9) KKR consolidates KFN and thus reports KFN's outstanding $70.0 million aggregate principal amount of 5.400% senior notes due 2033. Borrowing outstanding is presented net of unamortized debt issuance costs of $1.3 million and $1.3 million as of March 31, 2019 and December 31, 2018 , respectively. These debt obligations are classified as Level III within the fair value hierarchy and valued using the same valuation methodologies as KKR's Level III credit investments. (10) KKR consolidates KFN and thus reports KFN's outstanding $258.5 million aggregate principal amount of junior subordinated notes. The weighted average interest rate is 5.2% and 5.0% and the weighted average years to maturity is 17.5 years and 17.8 years as of March 31, 2019 and December 31, 2018 , respectively. These debt obligations are classified as Level III within the fair value hierarchy and valued using the same valuation methodologies as KKR's Level III credit investments. (11) Amounts include (i) borrowings at consolidated investment funds relating to financing arrangements with major financial institutions, generally to enable such investment funds to make investments prior to or without receiving capital from fund limited partners and (ii) borrowings by certain majority-owned investment vehicles that are collateralized only by the investments and assets they own. The weighted average interest rate is 4.9% and 4.6% as of March 31, 2019 and December 31, 2018 , respectively. In addition, the weighted average years to maturity is 3.6 years and 3.3 years as of March 31, 2019 and December 31, 2018 , respectively. (12) CLO debt obligations are carried at fair value and are classified as Level II within the fair value hierarchy. See Note 5 "Fair Value Measurements." (13) CMBS debt obligations are carried at fair value and are classified as Level III within the fair value hierarchy. See Note 5 "Fair Value Measurements." (14) The notes are classified as Level II within the fair value hierarchy and fair value is determined by third party broker quotes. |
Schedule of debt obligations of consolidated CLOs | As of March 31, 2019 , debt obligations of consolidated CFEs consisted of the following: Borrowing Outstanding Weighted Average Interest Rate Weighted Average Remaining Maturity in Years Senior Secured Notes of Consolidated CLOs $ 12,155,621 3.4 % 11.5 Subordinated Notes of Consolidated CLOs 402,200 (1) 11.7 Debt Obligations of Consolidated CMBS Vehicles 1,914,571 4.0 % 24.5 $ 14,472,392 (1) The subordinated notes do not have contractual interest rates but instead receive a pro rata amount of the net distributions from the excess cash flows of the respective CLO vehicle. Accordingly, weighted average borrowing rates for the subordinated notes are based on cash distributions during the period, if any. |
EQUITY BASED COMPENSATION (Tabl
EQUITY BASED COMPENSATION (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of expense associated with equity based compensation | The following table summarizes the expense associated with equity-based compensation for the three months ended March 31, 2019 and 2018 , respectively. Three Months Ended March 31, 2019 2018 Equity Incentive Plans $ 54,885 $ 67,796 KKR Holdings Principal Awards 23,666 27,282 Total (1) $ 78,551 $ 95,078 (1) Includes $(0.3) million and $4.3 million of equity based compensation for the three months ended March 31, 2019 and 2018 related to employees of equity method investees. Such amounts are included in Net Gains (Losses) from Investment Activities in the consolidated statements of operations. |
Summary of information regarding the discount for the lack of participation rights in the expected dividends for shares granted | The following table presents information regarding the discount for the lack of participation rights in the expected dividends for shares granted subsequent to December 31, 2015: Date of Grant Discount per share (1) January 1, 2016 to December 31, 2016 $ 0.64 January 1, 2017 to December 31, 2017 $ 0.68 January 1, 2018 to June 30, 2018 $ 0.68 July 1, 2018 to Present $ 0.50 (1) Represents the annual discount for the lack of participation rights on expected dividends. The total discount on any given tranche of unvested shares is calculated as the discount per share multiplied by the number of years in the applicable vesting period. |
Summary of significant assumptions used to estimate grant date fair value of Market Condition Awards | Below is a summary of the significant assumptions used to estimate the grant date fair value of the Market Condition Awards: Closing KKR share price as of valuation date $19.90 Risk Free Rate 2.02 % Volatility 25.00 % Dividend Yield 3.42 % Expected Cost of Equity 11.02 % |
Schedule of unrecognized expense of equity incentive plan awards expected to be recognized | As of March 31, 2019 , there was approximately $340.4 million of total estimated unrecognized expense related to unvested awards, including Market Condition Awards. That cost is expected to be recognized as follows: Year Unrecognized Expense Remainder of 2019 $ 132.8 2020 131.8 2021 58.5 2022 16.4 2023 0.9 Total $ 340.4 |
Schedule of unvested awards granted under equity incentive plan | A summary of the status of unvested awards granted under the Equity Incentive Plans, excluding Market Condition Awards as described above, from January 1, 2019 through March 31, 2019 is presented below: Shares Weighted Average Grant Date Fair Value Balance, January 1, 2019 33,400,183 $ 16.23 Granted 50,511 18.96 Vested (15,440 ) 15.83 Forfeitures (604,519 ) 17.43 Balance, March 31, 2019 32,830,735 $ 16.21 |
Schedule of remaining vesting tranches of awards granted under the equity incentive plan | A summary of the remaining vesting tranches of awards granted under the Equity Incentive Plans is presented below: Vesting Date Shares April 1, 2019 8,917,856 October 1, 2019 4,733,416 April 1, 2020 7,135,649 October 1, 2020 3,607,073 April 1, 2021 4,093,420 October 1, 2021 2,134,028 April 1, 2022 916,731 October 1, 2022 1,201,390 October 1, 2023 91,172 32,830,735 |
Schedule of unrecognized expense of unvested KKR Holdings awards expected to be recognized | As of March 31, 2019 , there was approximately $230.3 million of estimated unrecognized expense related to unvested KKR Holdings awards. That cost is expected to be recognized as follows: Year Unrecognized Expense Remainder of 2019 $ 70.7 2020 86.9 2021 47.2 2022 25.5 Total $ 230.3 |
Schedule of unvested holding awards granted | A summary of the status of unvested awards granted under the KKR Holdings Plan from January 1, 2019 through March 31, 2019 is presented below: Units Weighted Average Grant Date Fair Value Balance, January 1, 2019 24,123,993 $ 14.42 Granted — — Vested — — Forfeitures (270,000 ) 16.28 Balance, March 31, 2019 23,853,993 $ 14.40 |
Schedule of remaining vesting tranches of holding awards granted | A summary of the remaining vesting tranches of awards granted under the KKR Holdings Plan is presented below: Vesting Date Units April 1, 2019 229,514 May 1, 2019 3,590,000 October 1, 2019 2,455,000 April 1, 2020 124,479 May 1, 2020 3,590,000 October 1, 2020 2,940,000 May 1, 2021 3,590,000 October 1, 2021 3,425,000 October 1, 2022 3,910,000 23,853,993 |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Related Party Transactions [Abstract] | |
Schedule of due from and to affiliates | Due from Affiliates consists of: March 31, 2019 December 31, 2018 Amounts due from portfolio companies $ 93,855 $ 82,204 Amounts due from unconsolidated investment funds 637,501 568,211 Amounts due from related entities 2,839 6,774 Due from Affiliates $ 734,195 $ 657,189 Due to Affiliates consists of: March 31, 2019 December 31, 2018 Amounts due to KKR Holdings in connection with the tax receivable agreement $ 108,270 $ 117,862 Amounts due to unconsolidated investment funds 146,511 157,722 Due to Affiliates $ 254,781 $ 275,584 |
SEGMENT REPORTING (Tables)
SEGMENT REPORTING (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Segment Reporting [Abstract] | |
Schedule of financial data of the entity's reportable segments | The following table sets forth information regarding KKR's segment results: As of and for the Three Months Ended March 31, 2019 March 31, 2018 Segment Revenues Fees and Other, Net Management Fees $ 292,296 $ 251,585 Transaction Fees 186,727 156,845 Monitoring Fees 25,651 17,530 Fee Credits (107,416 ) (43,774 ) Total Fees and Other, Net 397,258 382,186 Realized Performance Income (Loss) Carried Interest 330,345 202,555 Incentive Fees 19,537 16,407 Total Realized Performance Income (Loss) 349,882 218,962 Realized Investment Income (Loss) Net Realized Gains (Losses) 44,712 7,875 Interest Income and Dividends 58,207 72,577 Total Realized Investment Income (Loss) 102,919 80,452 Total Segment Revenues $ 850,059 $ 681,600 Segment Expenses Compensation and Benefits (1) 340,286 300,480 Occupancy and Related Charges 13,957 13,583 Other Operating Expenses 74,910 57,905 Total Segment Expenses $ 429,153 $ 371,968 Segment Operating Earnings 420,906 309,632 Interest Expense 44,130 50,192 Preferred Dividends 8,341 8,341 Income (Loss) Attributable to Noncontrolling Interests 359 1,203 Income Taxes Paid 53,993 14,168 After-tax Distributable Earnings $ 314,083 $ 235,728 Segment Assets $ 18,770,564 $ 16,243,603 Segment Liabilities $ 4,100,354 $ 3,736,797 Segment Book Value $ 14,148,206 $ 11,983,289 (1) Includes equity-based compensation of $54.9 million and $67.8 million for the three months ended March 31, 2019 and 2018 , respectively. |
Segment revenues disaggregated by business line | The following tables provide KKR's segment revenues on a disaggregated basis by business line: Three Months Ended March 31, 2019 Private Markets Public Markets Capital Markets Principal Activities Total Fees and Other, Net Management Fees $ 183,221 $ 109,075 $ — $ — $ 292,296 Transaction Fees 99,017 27,456 60,254 — 186,727 Monitoring Fees 25,651 — — — 25,651 Fee Credits (82,342 ) (25,074 ) — — (107,416 ) Total Fees and Other, Net 225,547 111,457 60,254 — 397,258 Realized Performance Income (Loss) Carried Interest 330,345 — — — 330,345 Incentive Fees 675 18,862 — — 19,537 Total Realized Performance Income (Loss) 331,020 18,862 — — 349,882 Realized Investment Income (Loss) Net Realized Gains (Losses) — — — 44,712 44,712 Interest Income and Dividends — — — 58,207 58,207 Total Realized Investment Income (Loss) — — — 102,919 102,919 Total $ 556,567 $ 130,319 $ 60,254 $ 102,919 $ 850,059 Three Months Ended March 31, 2018 Private Markets Public Markets Capital Markets Principal Activities Total Fees and Other, Net Management Fees $ 158,190 $ 93,395 $ — $ — $ 251,585 Transaction Fees 46,689 2,558 107,598 — 156,845 Monitoring Fees 17,530 — — — 17,530 Fee Credits (41,343 ) (2,431 ) — — (43,774 ) Total Fees and Other, Net 181,066 93,522 107,598 — 382,186 Realized Performance Income (Loss) Carried Interest 202,555 — — — 202,555 Incentive Fees — 16,407 — — 16,407 Total Realized Performance Income (Loss) 202,555 16,407 — — 218,962 Realized Investment Income (Loss) Net Realized Gains (Losses) — — — 7,875 7,875 Interest Income and Dividends — — — 72,577 72,577 Total Realized Investment Income (Loss) — — — 80,452 80,452 Total $ 383,621 $ 109,929 $ 107,598 $ 80,452 $ 681,600 |
Schedule of reconciliation of financial information from total reportable segments to the most directly comparable financial measures calculated and presented in accordance with GAAP | The following tables reconcile the most directly comparable financial measures calculated and presented in accordance with GAAP to KKR's segment information: Revenues Three Months Ended March 31, 2019 March 31, 2018 Total GAAP Revenues $ 1,187,480 $ 472,606 Add: Management Fees - Consolidated Funds and Other 121,949 64,596 Deduct: Fee Credits - Consolidated Funds 3,939 14,721 Deduct: Capital Allocation-Based Income (GAAP) 814,932 78,212 Add: Segment Realized Carried Interest 330,345 202,555 Add: Segment Realized Investment Income (Loss) 102,919 80,452 Deduct: Revenue Earned by Other Consolidated Entities 29,703 25,465 Deduct: Expense Reimbursements 44,060 20,211 Total Segment Revenues $ 850,059 $ 681,600 Expenses Three Months Ended March 31, 2019 March 31, 2018 Total GAAP Expenses $ 728,767 $ 436,601 Deduct: Equity-based and Other Compensation - KKR Holdings L.P. 23,743 32,695 Deduct: Segment Unrealized Performance Income Compensation 159,880 (43,123 ) Deduct: Amortization of Intangibles 535 5,030 Deduct: Reimbursable Expenses 52,032 26,093 Deduct: Operating Expenses relating to Other Consolidated Entities 51,818 44,309 Add: Other (11,606 ) 371 Total Segment Expenses $ 429,153 $ 371,968 Net Income (Loss) Attributable to KKR & Co. Inc. Class A Common Stockholders Three Months Ended March 31, 2019 March 31, 2018 GAAP Net Income (Loss) Attributable to KKR & Co. Inc. Class A Common Stockholders $ 700,978 $ 170,102 Add: Net Income (Loss) Attributable to Noncontrolling Interests held by KKR Holdings L.P. 481,368 121,002 Add: Equity-based and Other Compensation - KKR Holdings L.P. 23,118 32,695 Add: Amortization of Intangibles and Other, net 56,153 47,709 Deduct: Unrealized Carried Interest 401,612 (111,732 ) Deduct: Net Unrealized Gains (Losses) 819,402 207,862 Add: Unrealized Performance Income Compensation 159,880 (43,123 ) Add: Income Tax Provision 167,593 17,641 Deduct: Income Taxes Paid 53,993 14,168 After-tax Distributable Earnings $ 314,083 $ 235,728 |
Reconciliation of assets from segment to consolidated | Assets As of March 31, 2019 2018 GAAP Assets $ 52,004,019 $ 47,579,153 Impact of Consolidation of Investment Vehicles and Other Entities (31,561,635 ) (29,972,064 ) Carry Pool Reclassification (1,089,045 ) (1,176,070 ) Other Reclassifications (582,775 ) — Impact of KKR Management Holdings Corp. — (187,416 ) Segment Assets (1) $ 18,770,564 $ 16,243,603 |
Reconciliation of liabilities and stockholders' equity from segment to consolidated | Liabilities As of March 31, 2019 2018 GAAP Liabilities $ 25,796,178 $ 25,810,215 Impact of Consolidation of Investment Vehicles and Other Entities (20,024,004 ) (20,775,320 ) Carry Pool Reclassification (1,089,045 ) (1,176,070 ) Other Reclassifications (582,775 ) — Impact of KKR Management Holdings Corp. — (122,028 ) Segment Liabilities (1) $ 4,100,354 $ 3,736,797 Stockholders' Equity As of March 31, 2019 2018 KKR & Co. Inc. Stockholders' Equity - Common Stockholders $ 8,839,817 $ 6,918,185 Impact of Consolidation of Investment Vehicles and Other Entities 246,793 254,777 Other Reclassifications (17,446 ) (17,446 ) Noncontrolling Interests Held by KKR Holdings L.P. 5,079,042 4,893,161 Impact of KKR Management Holdings Corp. — (65,388 ) Segment Book Value (1) $ 14,148,206 $ 11,983,289 (1) As of March 31, 2019 , KKR's segment assets, liabilities, and book value reflect KKR's tax assets and liabilities prepared under GAAP. |
EQUITY (Tables)
EQUITY (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Equity [Abstract] | |
Schedule of calculation of noncontrolling interests | The following table presents the calculation of total noncontrolling interests: Three Months Ended March 31, 2019 Noncontrolling Interests in Consolidated Entities Noncontrolling Interests Held by KKR Holdings Total Noncontrolling Interests Balance at the beginning of the period $ 10,984,910 $ 4,625,448 $ 15,610,358 Net income (loss) attributable to noncontrolling interests (1) 436,359 481,368 917,727 Other comprehensive income (loss), net of tax (2) 2,511 121 2,632 Exchange of KKR Holdings Units to Class A Common Stock (3) — (7,094 ) (7,094 ) Equity-based and other non-cash compensation — 23,118 23,118 Capital contributions 1,194,792 23 1,194,815 Capital distributions (812,144 ) (43,942 ) (856,086 ) Balance at the end of the period $ 11,806,428 $ 5,079,042 $ 16,885,470 (1) Refer to the table below for calculation of net income (loss) attributable to noncontrolling interests held by KKR Holdings. (2) With respect to noncontrolling interests held by KKR Holdings, calculated on a pro rata basis based on the weighted average KKR Group Partnership Units held by KKR Holdings during the reporting period. (3) Calculated based on the proportion of KKR Holdings units exchanged for KKR & Co. Inc. Class A common stock during the reporting period. The exchange agreement with KKR Holdings provides for the exchange of KKR Group Partnership Units held by KKR Holdings for KKR & Co. Inc. Class A common stock. |
Schedule of net income (loss) attributable to noncontrolling interests held by KKR Holdings | The following table presents net income (loss) attributable to noncontrolling interests held by KKR Holdings: Three Months Ended March 31, 2019 2018 Net income (loss) $ 1,627,046 $ 602,894 Less: Net income (loss) attributable to Redeemable Noncontrolling Interests — 25,674 Less: Net income (loss) attributable to Noncontrolling Interests in consolidated entities 436,359 277,775 Less: Preferred Stock Dividends 8,341 8,341 Plus: Income tax expense (benefit) attributable to KKR & Co. Inc. 158,962 6,068 Net income (loss) attributable to KKR & Co. Inc. Class A Common Stockholders and KKR Holdings $ 1,341,308 $ 297,172 Net income (loss) attributable to Noncontrolling Interests held by KKR Holdings $ 481,368 $ 121,002 |
Redeemable noncontrolling interests | The following table presents the rollforward of Redeemable Noncontrolling Interests: For the Three Months Ended March 31, 2019 Balance at the beginning of the period $ 1,122,641 Changes in consolidation (1,122,641 ) Balance at the end of the period $ — |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of minimum future lease payments | As of March 31, 2019 , the approximate aggregate minimum future lease payments, net of sublease income, required on the operating leases are as follows: April 2019 - March 2020 $ 50,312 April 2020 - March 2022 66,055 April 2022 - March 2024 26,828 April 2024 and thereafter 18,855 Total minimum payments required 162,050 Less: Imputed Interest (9,977 ) Total operating lease liabilities $ 152,073 |
Schedule of minimum future lease payments | As of December 31, 2018, the approximate aggregate minimum future lease payments, net of sublease income, required on the operating leases are as follows: 2019 $ 50,649 2020 - 2021 69,263 2022 - 2023 29,687 2024 and thereafter 76,332 Total minimum payments required (1) $ 225,931 (1) Table depicts aggregate minimum future lease payments under ASC 840. |
ORGANIZATION - Narrative (Detai
ORGANIZATION - Narrative (Details) - KKR Group Partnerships | 3 Months Ended |
Mar. 31, 2019 | |
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |
Percentage of economic interest held by parent entity | 64.10% |
KKR Holdings | |
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |
Percentage owned by KKR Holdings L.P. | 35.90% |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Fair Value Measurement (Details) | 3 Months Ended |
Mar. 31, 2019methodology | |
Accounting Policies [Abstract] | |
Number of valuation methodologies used to determine fair value of investments | 2 |
Maximum | |
Fair Value Measurements | |
Weighting percentage of methodology used to determine fair value of investments (up to 100%) | 100.00% |
Illiquidity Discount | Minimum | |
Fair Value Measurements | |
Private equity, measurement input | 0.05 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Revenues (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Fees and Commissions [Line Items] | ||
Fees and Other | $ 372,548 | $ 394,394 |
Carried Interest | 694,383 | 62,747 |
General Partner Capital Interest | 120,549 | 15,465 |
Total Capital Allocation-Based Income | 814,932 | 78,212 |
Total Revenues | $ 1,187,480 | 472,606 |
Incentive fee, low end of range (as a percent) | 5.00% | |
Incentive fee, high end of range (as a percent) | 20.00% | |
Measurement period (in years) | 1 year | |
Reportable segments | ||
Fees and Commissions [Line Items] | ||
Fees and Other | $ 397,258 | 382,186 |
Carried Interest | 330,345 | 202,555 |
Total Revenues | $ 850,059 | 681,600 |
Minimum | Reportable segments | ||
Fees and Commissions [Line Items] | ||
Fee Credits as a percentage of monitoring and transaction fees net of fund-related expenses | 80.00% | |
Maximum | Reportable segments | ||
Fees and Commissions [Line Items] | ||
Fee Credits as a percentage of monitoring and transaction fees net of fund-related expenses | 100.00% | |
Management Fees | ||
Fees and Commissions [Line Items] | ||
Fees and Other | $ 188,408 | 187,727 |
Management Fees | Reportable segments | ||
Fees and Commissions [Line Items] | ||
Fees and Other | 292,296 | 251,585 |
Fee Credits | ||
Fees and Commissions [Line Items] | ||
Fees and Other | (103,477) | (29,053) |
Fee Credits | Reportable segments | ||
Fees and Commissions [Line Items] | ||
Fees and Other | (107,416) | (43,774) |
Transaction Fees | ||
Fees and Commissions [Line Items] | ||
Fees and Other | 188,203 | 158,653 |
Transaction Fees | Reportable segments | ||
Fees and Commissions [Line Items] | ||
Fees and Other | 186,727 | 156,845 |
Monitoring Fees | ||
Fees and Commissions [Line Items] | ||
Fees and Other | 25,651 | 17,586 |
Monitoring Fees | Reportable segments | ||
Fees and Commissions [Line Items] | ||
Fees and Other | 25,651 | 17,530 |
Incentive Fees | ||
Fees and Commissions [Line Items] | ||
Fees and Other | 0 | 13,805 |
Expense Reimbursements | ||
Fees and Commissions [Line Items] | ||
Fees and Other | 44,060 | 20,211 |
Oil and Gas Revenue | ||
Fees and Commissions [Line Items] | ||
Fees and Other | 13,175 | 14,507 |
Consulting Fees | ||
Fees and Commissions [Line Items] | ||
Fees and Other | $ 16,528 | $ 10,958 |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Recently Issued Accounting Pronouncements (Details) - USD ($) | Mar. 31, 2019 | Jan. 01, 2019 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
ROU assets | $ 146,165,000 | |
Total operating lease liabilities | $ 152,073,000 | |
Accounting Standards Update 2016-02 | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
ROU assets | $ 153,300,000 | |
Total operating lease liabilities | 162,900,000 | |
Accounting Standards Update 2016-02 | Retained Earnings | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Cumulative-effect adjustment | $ 0 |
NET GAINS (LOSSES) FROM INVES_3
NET GAINS (LOSSES) FROM INVESTMENT ACTIVITIES (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Gain (Loss) on Securities [Line Items] | ||
Net Realized Gains (Losses) | $ 129,781 | $ 30,380 |
Net Unrealized Gains (Losses) | 1,074,097 | 442,420 |
Total | 1,203,878 | 472,800 |
Private Equity | ||
Gain (Loss) on Securities [Line Items] | ||
Net Realized Gains (Losses) | 68,568 | 16,253 |
Net Unrealized Gains (Losses) | 919,625 | 158,369 |
Total | 988,193 | 174,622 |
Credit | ||
Gain (Loss) on Securities [Line Items] | ||
Net Realized Gains (Losses) | (17,876) | 1,263 |
Net Unrealized Gains (Losses) | 8,669 | 58,150 |
Total | (9,207) | 59,413 |
Investments of Consolidated CFEs | ||
Gain (Loss) on Securities [Line Items] | ||
Net Realized Gains (Losses) | (10,530) | (26,516) |
Net Unrealized Gains (Losses) | 233,357 | (48,403) |
Total | 222,827 | (74,919) |
Real Assets | ||
Gain (Loss) on Securities [Line Items] | ||
Net Realized Gains (Losses) | 29,547 | 12,957 |
Net Unrealized Gains (Losses) | 89,581 | 59,297 |
Total | 119,128 | 72,254 |
Equity Method - Other | ||
Gain (Loss) on Securities [Line Items] | ||
Net Realized Gains (Losses) | 20,133 | 9,210 |
Net Unrealized Gains (Losses) | 156,906 | 135,604 |
Total | 177,039 | 144,814 |
Other Investments | ||
Gain (Loss) on Securities [Line Items] | ||
Net Realized Gains (Losses) | 1,450 | (244,199) |
Net Unrealized Gains (Losses) | (30,361) | 86,365 |
Total | (28,911) | (157,834) |
Foreign Exchange Forward Contracts and Options | ||
Gain (Loss) on Securities [Line Items] | ||
Net Realized Gains (Losses) | 25,454 | (32,614) |
Net Unrealized Gains (Losses) | 54,789 | (63,118) |
Total | 80,243 | (95,732) |
Securities Sold Short | ||
Gain (Loss) on Securities [Line Items] | ||
Net Realized Gains (Losses) | 14,426 | 275,949 |
Net Unrealized Gains (Losses) | (80,772) | (29,874) |
Total | (66,346) | 246,075 |
Other Derivatives | ||
Gain (Loss) on Securities [Line Items] | ||
Net Realized Gains (Losses) | 1,465 | 3,642 |
Net Unrealized Gains (Losses) | (13,405) | (8,223) |
Total | (11,940) | (4,581) |
Debt Obligations and Other | ||
Gain (Loss) on Securities [Line Items] | ||
Net Realized Gains (Losses) | (2,856) | 14,435 |
Net Unrealized Gains (Losses) | (264,292) | 94,253 |
Total | $ (267,148) | $ 108,688 |
INVESTMENTS - Summary of Invest
INVESTMENTS - Summary of Investments (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Investments | ||
Investments owned, at fair value | $ 45,795,254 | $ 44,907,982 |
Private Equity | ||
Investments | ||
Investments owned, at fair value | 8,522,282 | 7,349,559 |
Credit | ||
Investments | ||
Investments owned, at fair value | 7,649,787 | 9,099,135 |
Investments of Consolidated CFEs | ||
Investments | ||
Investments owned, at fair value | 15,021,345 | 14,733,423 |
Real Assets | ||
Investments | ||
Investments owned, at fair value | 3,213,813 | 3,157,954 |
Equity Method - Other | ||
Investments | ||
Investments owned, at fair value | 4,472,692 | 4,212,874 |
Equity Method - Capital Allocation-Based Income | ||
Investments | ||
Investments owned, at fair value | 4,203,980 | 3,584,415 |
Other Investments | ||
Investments | ||
Investments owned, at fair value | $ 2,711,355 | $ 2,770,622 |
INVESTMENTS - Narrative (Detail
INVESTMENTS - Narrative (Details) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2019 | Dec. 31, 2018 | |
Investments | Investment Concentration Risk | ||
Investments | ||
Threshold percentage of total investments (greater than) | 5.00% | 5.00% |
FAIR VALUE MEASUREMENTS - Asset
FAIR VALUE MEASUREMENTS - Assets and Liabilities at Fair Value (Details) - Fair value measured on recurring basis - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Assets, at fair value: | ||
Total Investments | $ 39,036,265 | $ 38,902,883 |
Total Assets | 39,275,085 | 39,121,142 |
Liabilities, at fair value: | ||
Securities Sold Short | 582,608 | 344,124 |
Unfunded Revolver Commitments | 56,792 | 52,066 |
Total Liabilities | 15,169,961 | 14,451,133 |
Debt Obligations of Consolidated CFEs | ||
Liabilities, at fair value: | ||
Total Liabilities | 14,472,392 | 13,958,554 |
Foreign Exchange Forward Contracts | ||
Assets, at fair value: | ||
Total Assets | 205,900 | 177,264 |
Liabilities, at fair value: | ||
Total Liabilities | 17,200 | 60,749 |
Other Derivatives | ||
Assets, at fair value: | ||
Total Assets | 32,920 | 40,995 |
Liabilities, at fair value: | ||
Total Liabilities | 40,969 | 35,640 |
Private Equity | ||
Assets, at fair value: | ||
Total Investments | 8,522,282 | 7,349,559 |
Credit | ||
Assets, at fair value: | ||
Total Investments | 7,649,787 | 9,099,135 |
Investments of Consolidated CFEs | ||
Assets, at fair value: | ||
Total Investments | 15,021,345 | 14,733,423 |
Real Assets | ||
Assets, at fair value: | ||
Total Investments | 3,213,813 | 3,157,954 |
Equity Method - Other | ||
Assets, at fair value: | ||
Total Investments | 1,917,683 | 1,792,190 |
Other Investments | ||
Assets, at fair value: | ||
Total Investments | 2,711,355 | 2,770,622 |
Level I | ||
Assets, at fair value: | ||
Total Investments | 2,324,892 | 1,882,394 |
Total Assets | 2,324,892 | 1,882,394 |
Liabilities, at fair value: | ||
Securities Sold Short | 582,608 | 344,124 |
Unfunded Revolver Commitments | 0 | 0 |
Total Liabilities | 582,608 | 344,124 |
Level I | Debt Obligations of Consolidated CFEs | ||
Liabilities, at fair value: | ||
Total Liabilities | 0 | 0 |
Level I | Foreign Exchange Forward Contracts | ||
Assets, at fair value: | ||
Total Assets | 0 | 0 |
Liabilities, at fair value: | ||
Total Liabilities | 0 | 0 |
Level I | Other Derivatives | ||
Assets, at fair value: | ||
Total Assets | 0 | 0 |
Liabilities, at fair value: | ||
Total Liabilities | 0 | 0 |
Level I | Private Equity | ||
Assets, at fair value: | ||
Total Investments | 1,603,803 | 1,156,977 |
Level I | Credit | ||
Assets, at fair value: | ||
Total Investments | 0 | 0 |
Level I | Investments of Consolidated CFEs | ||
Assets, at fair value: | ||
Total Investments | 0 | 0 |
Level I | Real Assets | ||
Assets, at fair value: | ||
Total Investments | 0 | 0 |
Level I | Equity Method - Other | ||
Assets, at fair value: | ||
Total Investments | 219,566 | 245,225 |
Level I | Other Investments | ||
Assets, at fair value: | ||
Total Investments | 501,523 | 480,192 |
Level II | ||
Assets, at fair value: | ||
Total Investments | 14,337,671 | 15,267,069 |
Total Assets | 14,545,357 | 15,448,212 |
Liabilities, at fair value: | ||
Securities Sold Short | 0 | 0 |
Unfunded Revolver Commitments | 0 | 0 |
Total Liabilities | 12,598,790 | 12,160,960 |
Level II | Debt Obligations of Consolidated CFEs | ||
Liabilities, at fair value: | ||
Total Liabilities | 12,557,821 | 12,081,771 |
Level II | Foreign Exchange Forward Contracts | ||
Assets, at fair value: | ||
Total Assets | 205,900 | 177,264 |
Liabilities, at fair value: | ||
Total Liabilities | 17,200 | 60,749 |
Level II | Other Derivatives | ||
Assets, at fair value: | ||
Total Assets | 1,786 | 3,879 |
Liabilities, at fair value: | ||
Total Liabilities | 23,769 | 18,440 |
Level II | Private Equity | ||
Assets, at fair value: | ||
Total Investments | 86,933 | 63,999 |
Level II | Credit | ||
Assets, at fair value: | ||
Total Investments | 1,119,308 | 2,334,405 |
Level II | Investments of Consolidated CFEs | ||
Assets, at fair value: | ||
Total Investments | 12,937,610 | 12,650,878 |
Level II | Real Assets | ||
Assets, at fair value: | ||
Total Investments | 0 | 0 |
Level II | Equity Method - Other | ||
Assets, at fair value: | ||
Total Investments | 47,938 | 43,943 |
Level II | Other Investments | ||
Assets, at fair value: | ||
Total Investments | 145,882 | 173,844 |
Level III | ||
Assets, at fair value: | ||
Total Investments | 22,373,702 | 21,753,420 |
Total Assets | 22,404,836 | 21,790,536 |
Liabilities, at fair value: | ||
Securities Sold Short | 0 | 0 |
Unfunded Revolver Commitments | 56,792 | 52,066 |
Total Liabilities | 1,988,563 | 1,946,049 |
Level III | Debt Obligations of Consolidated CFEs | ||
Liabilities, at fair value: | ||
Total Liabilities | 1,914,571 | 1,876,783 |
Level III | Foreign Exchange Forward Contracts | ||
Assets, at fair value: | ||
Total Assets | 0 | 0 |
Liabilities, at fair value: | ||
Total Liabilities | 0 | 0 |
Level III | Other Derivatives | ||
Assets, at fair value: | ||
Total Assets | 31,134 | 37,116 |
Liabilities, at fair value: | ||
Total Liabilities | 17,200 | 17,200 |
Level III | Private Equity | ||
Assets, at fair value: | ||
Total Investments | 6,831,546 | 6,128,583 |
Level III | Credit | ||
Assets, at fair value: | ||
Total Investments | 6,530,479 | 6,764,730 |
Level III | Investments of Consolidated CFEs | ||
Assets, at fair value: | ||
Total Investments | 2,083,735 | 2,082,545 |
Level III | Real Assets | ||
Assets, at fair value: | ||
Total Investments | 3,213,813 | 3,157,954 |
Level III | Equity Method - Other | ||
Assets, at fair value: | ||
Total Investments | 1,650,179 | 1,503,022 |
Level III | Other Investments | ||
Assets, at fair value: | ||
Total Investments | $ 2,063,950 | $ 2,116,586 |
FAIR VALUE MEASUREMENTS - Chang
FAIR VALUE MEASUREMENTS - Changes in Level III Investments (Details) - Level III - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Total Level III Investments | ||
Fair value, assets measured on recurring basis, level 3 fair-value category reconciliation | ||
Balance, Beg. of Period | $ 21,753,420 | $ 17,752,304 |
Transfers In / (Out) Due to Changes in Consolidation | (44,462) | 0 |
Transfers In | 0 | 0 |
Transfers Out | (56,029) | 0 |
Asset Purchases / Debt Issuances | 1,521,924 | 2,225,431 |
Sales / Paydowns | (1,365,091) | (379,324) |
Settlements | 20,815 | (53,825) |
Net Realized Gains (Losses) | 96,664 | 53,487 |
Net Unrealized Gains (Losses) | 443,819 | 297,476 |
Change in Other Comprehensive Income | 2,642 | (15,522) |
Balance, End of Period | 22,373,702 | 19,880,027 |
Changes in Net Unrealized Gains (Losses) Included in Net Gains (Losses) from Investment Activities related to Level III Assets and Liabilities still held as of the Reporting Date | 513,568 | 318,553 |
Private Equity | ||
Fair value, assets measured on recurring basis, level 3 fair-value category reconciliation | ||
Balance, Beg. of Period | 6,128,583 | 2,172,290 |
Transfers In / (Out) Due to Changes in Consolidation | 0 | 0 |
Transfers In | 0 | 0 |
Transfers Out | (56,029) | 0 |
Asset Purchases / Debt Issuances | 409,621 | 727,626 |
Sales / Paydowns | (99,603) | (35,245) |
Settlements | 0 | 0 |
Net Realized Gains (Losses) | 68,568 | 15,312 |
Net Unrealized Gains (Losses) | 380,406 | 208,428 |
Change in Other Comprehensive Income | 0 | 0 |
Balance, End of Period | 6,831,546 | 3,088,411 |
Changes in Net Unrealized Gains (Losses) Included in Net Gains (Losses) from Investment Activities related to Level III Assets and Liabilities still held as of the Reporting Date | 442,672 | 208,428 |
Credit | ||
Fair value, assets measured on recurring basis, level 3 fair-value category reconciliation | ||
Balance, Beg. of Period | 6,764,730 | 5,138,937 |
Transfers In / (Out) Due to Changes in Consolidation | (1,598) | 0 |
Transfers In | 0 | 0 |
Transfers Out | 0 | 0 |
Asset Purchases / Debt Issuances | 811,957 | 890,113 |
Sales / Paydowns | (1,028,063) | (230,144) |
Settlements | 20,815 | (53,825) |
Net Realized Gains (Losses) | (15,198) | 11,581 |
Net Unrealized Gains (Losses) | (24,806) | 77,715 |
Change in Other Comprehensive Income | 2,642 | (15,522) |
Balance, End of Period | 6,530,479 | 5,818,855 |
Changes in Net Unrealized Gains (Losses) Included in Net Gains (Losses) from Investment Activities related to Level III Assets and Liabilities still held as of the Reporting Date | (31,282) | 86,754 |
Investments of Consolidated CFEs | ||
Fair value, assets measured on recurring basis, level 3 fair-value category reconciliation | ||
Balance, Beg. of Period | 2,082,545 | 5,353,090 |
Transfers In / (Out) Due to Changes in Consolidation | 0 | 0 |
Transfers In | 0 | 0 |
Transfers Out | 0 | 0 |
Asset Purchases / Debt Issuances | 0 | 0 |
Sales / Paydowns | (38,295) | (11,541) |
Settlements | 0 | 0 |
Net Realized Gains (Losses) | 0 | 0 |
Net Unrealized Gains (Losses) | 39,485 | (83,150) |
Change in Other Comprehensive Income | 0 | 0 |
Balance, End of Period | 2,083,735 | 5,258,399 |
Changes in Net Unrealized Gains (Losses) Included in Net Gains (Losses) from Investment Activities related to Level III Assets and Liabilities still held as of the Reporting Date | 39,485 | (83,150) |
Real Assets | ||
Fair value, assets measured on recurring basis, level 3 fair-value category reconciliation | ||
Balance, Beg. of Period | 3,157,954 | 2,251,267 |
Transfers In / (Out) Due to Changes in Consolidation | 0 | 0 |
Transfers In | 0 | 0 |
Transfers Out | 0 | 0 |
Asset Purchases / Debt Issuances | 67,302 | 540,898 |
Sales / Paydowns | (130,571) | (34,237) |
Settlements | 0 | 0 |
Net Realized Gains (Losses) | 29,547 | 8,354 |
Net Unrealized Gains (Losses) | 89,581 | 61,151 |
Change in Other Comprehensive Income | 0 | 0 |
Balance, End of Period | 3,213,813 | 2,827,433 |
Changes in Net Unrealized Gains (Losses) Included in Net Gains (Losses) from Investment Activities related to Level III Assets and Liabilities still held as of the Reporting Date | 92,900 | 61,151 |
Equity Method - Other | ||
Fair value, assets measured on recurring basis, level 3 fair-value category reconciliation | ||
Balance, Beg. of Period | 1,503,022 | 1,076,709 |
Transfers In / (Out) Due to Changes in Consolidation | 0 | 0 |
Transfers In | 0 | 0 |
Transfers Out | 0 | 0 |
Asset Purchases / Debt Issuances | 137,909 | 2,037 |
Sales / Paydowns | (41,126) | (31,939) |
Settlements | 0 | 0 |
Net Realized Gains (Losses) | 11,626 | 9,348 |
Net Unrealized Gains (Losses) | 38,748 | 29,570 |
Change in Other Comprehensive Income | 0 | 0 |
Balance, End of Period | 1,650,179 | 1,085,725 |
Changes in Net Unrealized Gains (Losses) Included in Net Gains (Losses) from Investment Activities related to Level III Assets and Liabilities still held as of the Reporting Date | 49,140 | 34,928 |
Other Investments | ||
Fair value, assets measured on recurring basis, level 3 fair-value category reconciliation | ||
Balance, Beg. of Period | 2,116,586 | 1,760,011 |
Transfers In / (Out) Due to Changes in Consolidation | (42,864) | 0 |
Transfers In | 0 | 0 |
Transfers Out | 0 | 0 |
Asset Purchases / Debt Issuances | 95,135 | 64,757 |
Sales / Paydowns | (27,433) | (36,218) |
Settlements | 0 | 0 |
Net Realized Gains (Losses) | 2,121 | 8,892 |
Net Unrealized Gains (Losses) | (79,595) | 3,762 |
Change in Other Comprehensive Income | 0 | 0 |
Balance, End of Period | 2,063,950 | 1,801,204 |
Changes in Net Unrealized Gains (Losses) Included in Net Gains (Losses) from Investment Activities related to Level III Assets and Liabilities still held as of the Reporting Date | $ (79,347) | $ 10,442 |
FAIR VALUE MEASUREMENTS - Cha_2
FAIR VALUE MEASUREMENTS - Changes in Level III Debt Obligations (Details) - Level III - Debt Obligations of Consolidated CFEs - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Fair value, liabilities measured on recurring basis, level 3 fair-value category reconciliation | ||
Balance, Beg. of Period | $ 1,876,783 | $ 5,238,236 |
Transfers Out Due to Deconsolidation of Funds | 0 | 0 |
Transfers In | 0 | 0 |
Transfers Out | 0 | 0 |
Asset Purchases / Debt Issuances | 0 | 0 |
Sales | 0 | 0 |
Settlements | (2,731) | (11,541) |
Net Realized Gains (Losses) | 0 | 0 |
Net Unrealized Gains (Losses) | 40,519 | (88,528) |
Change in Other Comprehensive Income | 0 | 0 |
Balance, End of Period | 1,914,571 | 5,138,167 |
Changes in Net Unrealized Gains (Losses) Included in Net Gains (Losses) from Investment Activities related to Level III Assets and Liabilities still held as of the Reporting Date | $ 40,519 | $ (88,528) |
FAIR VALUE MEASUREMENTS - Valua
FAIR VALUE MEASUREMENTS - Valuation Methodologies and Significant Unobservable Inputs (Details) | 3 Months Ended |
Mar. 31, 2019USD ($)$ / barrel | |
Level III | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, fair value | $ 6,831,546,000 |
Credit, fair value | 6,530,479,000 |
Investments of consolidated CFEs, fair value | 2,083,735,000 |
Debt obligations of consolidated CFEs, fair value | 1,914,571,000 |
Real assets, fair value | 3,213,813,000 |
Equity method - other, fair value | 1,650,179,000 |
Other investments, fair value | 2,063,950,000 |
Private Equity | Level III | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, fair value | 4,322,213,000 |
Growth Equity | Level III | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, fair value | 2,509,333,000 |
Energy | Level III | |
Level III investments and other financial instruments by valuation methodologies | |
Real assets, fair value | 1,711,998,000 |
Real Estate | Level III | |
Level III investments and other financial instruments by valuation methodologies | |
Real assets, fair value | $ 1,294,181,000 |
Illiquidity Discount | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0.05 |
Illiquidity Discount | Level III | Inputs to market comparables, discounted cash flow and transaction price | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Equity method - other, measurement input | 0.095 |
Other investments, measurement input | 0.102 |
Illiquidity Discount | Level III | Inputs to market comparables, discounted cash flow and transaction price | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Equity method - other, measurement input | 0.050 |
Other investments, measurement input | 0.050 |
Illiquidity Discount | Level III | Inputs to market comparables, discounted cash flow and transaction price | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Equity method - other, measurement input | 0.150 |
Other investments, measurement input | 0.200 |
Illiquidity Discount | Private Equity | Level III | Inputs to market comparables, discounted cash flow and transaction price | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0.061 |
Illiquidity Discount | Private Equity | Level III | Inputs to market comparables, discounted cash flow and transaction price | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0.050 |
Illiquidity Discount | Private Equity | Level III | Inputs to market comparables, discounted cash flow and transaction price | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0.150 |
Illiquidity Discount | Growth Equity | Level III | Inputs to market comparables, discounted cash flow and transaction price | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0.116 |
Illiquidity Discount | Growth Equity | Level III | Inputs to market comparables, discounted cash flow and transaction price | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0.050 |
Illiquidity Discount | Growth Equity | Level III | Inputs to market comparables, discounted cash flow and transaction price | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0.200 |
Weight Ascribed to Market Comparables | Level III | Inputs to market comparables, discounted cash flow and transaction price | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Equity method - other, measurement input | 0.426 |
Other investments, measurement input | 0.381 |
Weight Ascribed to Market Comparables | Level III | Inputs to market comparables, discounted cash flow and transaction price | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Equity method - other, measurement input | 0 |
Other investments, measurement input | 0 |
Weight Ascribed to Market Comparables | Level III | Inputs to market comparables, discounted cash flow and transaction price | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Equity method - other, measurement input | 0.750 |
Other investments, measurement input | 1 |
Weight Ascribed to Market Comparables | Private Equity | Level III | Inputs to market comparables, discounted cash flow and transaction price | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0.305 |
Weight Ascribed to Market Comparables | Private Equity | Level III | Inputs to market comparables, discounted cash flow and transaction price | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0 |
Weight Ascribed to Market Comparables | Private Equity | Level III | Inputs to market comparables, discounted cash flow and transaction price | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0.500 |
Weight Ascribed to Market Comparables | Growth Equity | Level III | Inputs to market comparables, discounted cash flow and transaction price | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0.352 |
Weight Ascribed to Market Comparables | Growth Equity | Level III | Inputs to market comparables, discounted cash flow and transaction price | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0 |
Weight Ascribed to Market Comparables | Growth Equity | Level III | Inputs to market comparables, discounted cash flow and transaction price | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 1 |
Weight Ascribed to Discounted Cash Flow | Level III | Inputs to market comparables, discounted cash flow and transaction price | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Equity method - other, measurement input | 0.394 |
Other investments, measurement input | 0.361 |
Weight Ascribed to Discounted Cash Flow | Level III | Inputs to market comparables, discounted cash flow and transaction price | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Equity method - other, measurement input | 0 |
Other investments, measurement input | 0 |
Weight Ascribed to Discounted Cash Flow | Level III | Inputs to market comparables, discounted cash flow and transaction price | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Equity method - other, measurement input | 1 |
Other investments, measurement input | 1 |
Weight Ascribed to Discounted Cash Flow | Private Equity | Level III | Inputs to market comparables, discounted cash flow and transaction price | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0.694 |
Weight Ascribed to Discounted Cash Flow | Private Equity | Level III | Inputs to market comparables, discounted cash flow and transaction price | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0 |
Weight Ascribed to Discounted Cash Flow | Private Equity | Level III | Inputs to market comparables, discounted cash flow and transaction price | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 1 |
Weight Ascribed to Discounted Cash Flow | Growth Equity | Level III | Inputs to market comparables, discounted cash flow and transaction price | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0.153 |
Weight Ascribed to Discounted Cash Flow | Growth Equity | Level III | Inputs to market comparables, discounted cash flow and transaction price | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0 |
Weight Ascribed to Discounted Cash Flow | Growth Equity | Level III | Inputs to market comparables, discounted cash flow and transaction price | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0.750 |
Weight Ascribed to Discounted Cash Flow | Real Estate | Level III | Inputs to direct income capitalization and discounted cash flow | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Real assets, measurement input | 0.678 |
Weight Ascribed to Discounted Cash Flow | Real Estate | Level III | Inputs to direct income capitalization and discounted cash flow | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Real assets, measurement input | 0 |
Weight Ascribed to Discounted Cash Flow | Real Estate | Level III | Inputs to direct income capitalization and discounted cash flow | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Real assets, measurement input | 1 |
Weight Ascribed to Transaction Price | Level III | Inputs to market comparables, discounted cash flow and transaction price | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Equity method - other, measurement input | 0.180 |
Other investments, measurement input | 0.258 |
Weight Ascribed to Transaction Price | Level III | Inputs to market comparables, discounted cash flow and transaction price | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Equity method - other, measurement input | 0 |
Other investments, measurement input | 0 |
Weight Ascribed to Transaction Price | Level III | Inputs to market comparables, discounted cash flow and transaction price | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Equity method - other, measurement input | 1 |
Other investments, measurement input | 1 |
Weight Ascribed to Transaction Price | Private Equity | Level III | Inputs to market comparables, discounted cash flow and transaction price | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0.001 |
Weight Ascribed to Transaction Price | Private Equity | Level III | Inputs to market comparables, discounted cash flow and transaction price | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0 |
Weight Ascribed to Transaction Price | Private Equity | Level III | Inputs to market comparables, discounted cash flow and transaction price | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 1 |
Enterprise Value/LTM EBITDA Multiple | Level III | Market comparables | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Equity method - other, measurement input | 12 |
Other investments, measurement input | 10.3 |
Enterprise Value/LTM EBITDA Multiple | Level III | Market comparables | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Equity method - other, measurement input | 6.9 |
Other investments, measurement input | 1.3 |
Enterprise Value/LTM EBITDA Multiple | Level III | Market comparables | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Equity method - other, measurement input | 15.2 |
Other investments, measurement input | 14.6 |
Enterprise Value/LTM EBITDA Multiple | Private Equity | Level III | Market comparables | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 14.2 |
Enterprise Value/LTM EBITDA Multiple | Private Equity | Level III | Market comparables | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 6.9 |
Enterprise Value/LTM EBITDA Multiple | Private Equity | Level III | Market comparables | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 23.7 |
Enterprise Value/Forward EBITDA Multiple | Level III | Market comparables | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Equity method - other, measurement input | 11.2 |
Other investments, measurement input | 9.1 |
Enterprise Value/Forward EBITDA Multiple | Level III | Market comparables | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Equity method - other, measurement input | 6.2 |
Other investments, measurement input | 1.2 |
Enterprise Value/Forward EBITDA Multiple | Level III | Market comparables | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Equity method - other, measurement input | 13.2 |
Other investments, measurement input | 11.7 |
Enterprise Value/Forward EBITDA Multiple | Private Equity | Level III | Market comparables | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 12.4 |
Enterprise Value/Forward EBITDA Multiple | Private Equity | Level III | Market comparables | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 6.2 |
Enterprise Value/Forward EBITDA Multiple | Private Equity | Level III | Market comparables | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 17.2 |
Weighted Average Cost of Capital | Level III | Discounted cash flow | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Equity method - other, measurement input | 0.090 |
Other investments, measurement input | 0.172 |
Weighted Average Cost of Capital | Level III | Discounted cash flow | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Equity method - other, measurement input | 0.056 |
Other investments, measurement input | 0.073 |
Weighted Average Cost of Capital | Level III | Discounted cash flow | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Equity method - other, measurement input | 0.130 |
Other investments, measurement input | 0.311 |
Weighted Average Cost of Capital | Private Equity | Level III | Discounted cash flow | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0.107 |
Weighted Average Cost of Capital | Private Equity | Level III | Discounted cash flow | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0.056 |
Weighted Average Cost of Capital | Private Equity | Level III | Discounted cash flow | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0.146 |
Weighted Average Cost of Capital | Energy | Level III | Discounted cash flow | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Real assets, measurement input | 0.106 |
Weighted Average Cost of Capital | Energy | Level III | Discounted cash flow | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Real assets, measurement input | 0.095 |
Weighted Average Cost of Capital | Energy | Level III | Discounted cash flow | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Real assets, measurement input | 0.141 |
Enterprise Value/LTM EBITDA Exit Multiple | Level III | Discounted cash flow | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Equity method - other, measurement input | 10.4 |
Other investments, measurement input | 8.9 |
Enterprise Value/LTM EBITDA Exit Multiple | Level III | Discounted cash flow | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Equity method - other, measurement input | 6 |
Other investments, measurement input | 6.5 |
Enterprise Value/LTM EBITDA Exit Multiple | Level III | Discounted cash flow | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Equity method - other, measurement input | 12.5 |
Other investments, measurement input | 9.1 |
Enterprise Value/LTM EBITDA Exit Multiple | Private Equity | Level III | Discounted cash flow | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 12.4 |
Enterprise Value/LTM EBITDA Exit Multiple | Private Equity | Level III | Discounted cash flow | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 6 |
Enterprise Value/LTM EBITDA Exit Multiple | Private Equity | Level III | Discounted cash flow | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 15 |
Weight Ascribed to Milestones | Growth Equity | Level III | Inputs to market comparables, discounted cash flow and transaction price | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0.495 |
Weight Ascribed to Milestones | Growth Equity | Level III | Inputs to market comparables, discounted cash flow and transaction price | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0 |
Weight Ascribed to Milestones | Growth Equity | Level III | Inputs to market comparables, discounted cash flow and transaction price | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 1 |
Base | Growth Equity | Level III | Scenario Weighting | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0.614 |
Base | Growth Equity | Level III | Scenario Weighting | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0.400 |
Base | Growth Equity | Level III | Scenario Weighting | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0.800 |
Downside | Growth Equity | Level III | Scenario Weighting | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0.160 |
Downside | Growth Equity | Level III | Scenario Weighting | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0.050 |
Downside | Growth Equity | Level III | Scenario Weighting | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0.300 |
Upside | Growth Equity | Level III | Scenario Weighting | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0.226 |
Upside | Growth Equity | Level III | Scenario Weighting | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0.100 |
Upside | Growth Equity | Level III | Scenario Weighting | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Private equity, measurement input | 0.450 |
Yield | Level III | Discounted cash flow | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Debt obligations of consolidated CFEs, measurement input | 0.058 |
Yield | Level III | Discounted cash flow | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Debt obligations of consolidated CFEs, measurement input | 0.026 |
Yield | Level III | Discounted cash flow | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Debt obligations of consolidated CFEs, measurement input | 0.155 |
Yield | Level III | Yield Analysis | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Credit, measurement input | 0.076 |
Yield | Level III | Yield Analysis | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Credit, measurement input | 0.035 |
Yield | Level III | Yield Analysis | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Credit, measurement input | 0.234 |
Net Leverage | Level III | Yield Analysis | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Credit, measurement input | 2.1 |
Net Leverage | Level III | Yield Analysis | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Credit, measurement input | 0.2 |
Net Leverage | Level III | Yield Analysis | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Credit, measurement input | 14.1 |
EBITDA Multiple | Level III | Yield Analysis | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Credit, measurement input | 9.7 |
EBITDA Multiple | Level III | Yield Analysis | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Credit, measurement input | 0.2 |
EBITDA Multiple | Level III | Yield Analysis | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Credit, measurement input | 38.2 |
Average Price Per BOE | Energy | Level III | Discounted cash flow | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Real assets, measurement input, value | $ 44.62 |
Average Price Per BOE | Energy | Level III | Discounted cash flow | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Real assets, measurement input | $ / barrel | 38.98 |
Average Price Per BOE | Energy | Level III | Discounted cash flow | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Real assets, measurement input | $ / barrel | 47.75 |
Weight Ascribed to Direct Income Capitalization | Real Estate | Level III | Inputs to direct income capitalization and discounted cash flow | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Real assets, measurement input | 0.322 |
Weight Ascribed to Direct Income Capitalization | Real Estate | Level III | Inputs to direct income capitalization and discounted cash flow | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Real assets, measurement input | 0 |
Weight Ascribed to Direct Income Capitalization | Real Estate | Level III | Inputs to direct income capitalization and discounted cash flow | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Real assets, measurement input | 1 |
Current Capitalization Rate | Real Estate | Level III | Direct income capitalization | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Real assets, measurement input | 0.059 |
Current Capitalization Rate | Real Estate | Level III | Direct income capitalization | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Real assets, measurement input | 0.004 |
Current Capitalization Rate | Real Estate | Level III | Direct income capitalization | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Real assets, measurement input | 0.095 |
Unlevered Discount Rate | Real Estate | Level III | Discounted cash flow | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Real assets, measurement input | 0.080 |
Unlevered Discount Rate | Real Estate | Level III | Discounted cash flow | Minimum | |
Level III investments and other financial instruments by valuation methodologies | |
Real assets, measurement input | 0.048 |
Unlevered Discount Rate | Real Estate | Level III | Discounted cash flow | Maximum | |
Level III investments and other financial instruments by valuation methodologies | |
Real assets, measurement input | 0.180 |
Infrastructure | Level III | |
Level III investments and other financial instruments by valuation methodologies | |
Real assets, fair value | $ 207,600,000 |
Infrastructure | Weighted Average Cost of Capital | Level III | Discounted cash flow | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Real assets, measurement input | 0.068 |
Infrastructure | Enterprise Value/LTM EBITDA Exit Multiple | Level III | Discounted cash flow | Weighted Average | |
Level III investments and other financial instruments by valuation methodologies | |
Real assets, measurement input | 10 |
Energy | Real Assets | Level III | Discounted cash flow | |
Level III investments and other financial instruments by valuation methodologies | |
Revenue ratio of liquids | 88.00% |
Revenue ratio of natural gas | 12.00% |
FAIR VALUE OPTION - Financial I
FAIR VALUE OPTION - Financial Instruments (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Assets | $ 21,996,235 | $ 22,024,820 |
Liabilities | 14,472,392 | 13,958,554 |
Private Equity | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Assets | 3,235 | 2,977 |
Credit | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Assets | 4,519,000 | 4,950,819 |
Investments of Consolidated CFEs | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Assets | 15,021,345 | 14,733,423 |
Real Assets | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Assets | 309,105 | 310,399 |
Equity Method - Other | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Assets | 1,917,683 | 1,792,190 |
Other Investments | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Assets | 225,867 | 235,012 |
Debt Obligations of Consolidated CFEs | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Liabilities | $ 14,472,392 | $ 13,958,554 |
FAIR VALUE OPTION - Change in F
FAIR VALUE OPTION - Change in Fair Value (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Fair value, option, assets, net realized gains (losses) | $ (19,560) | $ (40,929) |
Fair value, option, liabilities, net realized gains (losses) | 0 | 13,256 |
Fair value, option, assets, net unrealized gains (losses) | 278,000 | 9,301 |
Fair value, option, liabilities, net unrealized gains (losses) | (252,281) | 93,654 |
Fair value, option, assets, total gains (losses) | 258,440 | (31,628) |
Fair value, option, liabilities, total gains (losses) | (252,281) | 106,910 |
Private Equity | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Fair value, option, assets, net realized gains (losses) | 0 | 71 |
Fair value, option, assets, net unrealized gains (losses) | 194 | 316 |
Fair value, option, assets, total gains (losses) | 194 | 387 |
Credit | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Fair value, option, assets, net realized gains (losses) | (23,153) | (28,867) |
Fair value, option, assets, net unrealized gains (losses) | 20,942 | 2,656 |
Fair value, option, assets, total gains (losses) | (2,211) | (26,211) |
Investments of Consolidated CFEs | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Fair value, option, assets, net realized gains (losses) | (10,530) | (26,516) |
Fair value, option, assets, net unrealized gains (losses) | 233,357 | (48,403) |
Fair value, option, assets, total gains (losses) | 222,827 | (74,919) |
Real Assets | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Fair value, option, assets, net realized gains (losses) | 703 | 428 |
Fair value, option, assets, net unrealized gains (losses) | 2,436 | (3,483) |
Fair value, option, assets, total gains (losses) | 3,139 | (3,055) |
Equity Method - Other | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Fair value, option, assets, net realized gains (losses) | 11,626 | 9,348 |
Fair value, option, assets, net unrealized gains (losses) | 17,084 | 66,093 |
Fair value, option, assets, total gains (losses) | 28,710 | 75,441 |
Other Investments | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Fair value, option, assets, net realized gains (losses) | 1,794 | 4,607 |
Fair value, option, assets, net unrealized gains (losses) | 3,987 | (7,878) |
Fair value, option, assets, total gains (losses) | 5,781 | (3,271) |
Debt Obligations of Consolidated CFEs | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Fair value, option, liabilities, net realized gains (losses) | 0 | 13,256 |
Fair value, option, liabilities, net unrealized gains (losses) | (252,281) | 93,654 |
Fair value, option, liabilities, total gains (losses) | $ (252,281) | $ 106,910 |
NET INCOME (LOSS) ATTRIBUTABL_3
NET INCOME (LOSS) ATTRIBUTABLE TO KKR & CO. INC. PER SHARE OF CLASS A COMMON STOCK (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
NET INCOME (LOSS) ATTRIBUTABLE TO KKR & CO. INC. PER SHARE OF CLASS A COMMON STOCK | ||
Net Income (Loss) Attributable to KKR & Co. Inc. Class A Common Stockholders | $ 700,978 | $ 170,102 |
Preferred stock dividend rate (as a percent) | 7.375% | |
Weighted Average KKR Holdings Units | ||
Weighted Average KKR Holdings Units (in shares) | 298,858,418 | 335,016,218 |
Class A Common Stock | ||
NET INCOME (LOSS) ATTRIBUTABLE TO KKR & CO. INC. PER SHARE OF CLASS A COMMON STOCK | ||
Net Income (Loss) Attributable to KKR & Co. Inc. Class A Common Stockholders | $ 700,978 | $ 170,102 |
Excess of carrying value over consideration transferred on redemption of KFN 7.375% Series A LLC Preferred Shares | 0 | 3,102 |
Net Income (Loss) Available to KKR & Co. Inc. Class A Common Stockholders | $ 700,978 | $ 173,204 |
Basic Net Income (Loss) Per Share of Class A Common Stock | ||
Weighted Average Shares of Class A Common Stock Outstanding - Basic (in shares) | 533,892,474 | 487,704,838 |
Net Income (Loss) Attributable to KKR & Co. Inc. Per Share of Class A Common Stock - Basic (in dollars per share) | $ 1.31 | $ 0.36 |
Diluted Net Income (Loss) Per Share of Class A Common Stock | ||
Weighted Average Shares of Class A Common Stock Outstanding - Basic (in shares) | 533,892,474 | 487,704,838 |
Weighted Average Unvested Shares of Class A Common Stock and Other Exchangeable Securities (in shares) | 16,153,966 | 48,213,436 |
Weighted Average Shares of Class A Common Stock Outstanding - Diluted (in shares) | 550,046,440 | 535,918,274 |
Net Income (Loss) Attributable to KKR & Co. Inc. Per Share of Class A Common Stock - Diluted (in dollars per share) | $ 1.27 | $ 0.32 |
Class A Common Stock | Market Condition Awards | ||
Weighted Average KKR Holdings Units | ||
Weighted Average KKR Holdings Units (in shares) | 5,000,000 |
OTHER ASSETS AND ACCOUNTS PAY_3
OTHER ASSETS AND ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER LIABILITIES - Other Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
OTHER ASSETS AND ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER LIABILITIES | |||
Unsettled Investment Sales | $ 129,141 | $ 101,789 | |
Receivables | 64,802 | 27,258 | |
Due from Broker | 485,127 | 396,512 | |
Oil & Gas Assets, net | 210,865 | 225,256 | |
Deferred Tax Assets, net | 408,148 | 538,161 | |
Interest Receivable | 231,445 | 241,547 | |
Fixed Assets, net | 466,264 | 451,206 | |
Foreign Exchange Contracts and Options | 205,900 | 177,264 | |
Intangible Assets, net | 9,125 | 9,863 | |
Goodwill | 83,500 | 83,500 | |
Derivative Assets | 32,920 | 40,995 | |
Deposits | 7,284 | 7,299 | |
Prepaid Taxes | 73,054 | 69,165 | |
Prepaid Expenses | 27,106 | 23,551 | |
Operating Lease Right of Use Assets | 146,165 | ||
Deferred Financing Costs | 13,458 | 13,871 | |
Other | 93,498 | 129,455 | |
Total | 2,687,802 | 2,536,692 | |
Depreciation, depletion, and amortization of oil and natural gas properties | 13,800 | $ 7,100 | |
Accumulated depreciation and amortization of fixed assets | 118,010 | 113,453 | |
Depreciation and amortization expense of fixed assets | 4,371 | 3,710 | |
Intangible assets, accumulated amortization | 63,538 | $ 63,500 | |
Amortization of intangibles | 500 | $ 5,000 | |
Operating lease cost | $ 11,800 |
OTHER ASSETS AND ACCOUNTS PAY_4
OTHER ASSETS AND ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER LIABILITIES - Accounts Payable, Accrued Expenses and Other Liabilities (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Dec. 31, 2018 | |
OTHER ASSETS AND ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER LIABILITIES | ||
Amounts Payable to Carry Pool | $ 1,089,045 | $ 922,977 |
Unsettled Investment Purchases | 507,731 | 541,165 |
Securities Sold Short | 582,608 | 344,124 |
Derivative Liabilities | 40,969 | 35,640 |
Accrued Compensation and Benefits | 166,294 | 107,887 |
Interest Payable | 216,348 | 212,969 |
Foreign Exchange Contracts and Options | 17,200 | 60,749 |
Accounts Payable and Accrued Expenses | 108,170 | 130,554 |
Taxes Payable | 55,355 | 24,453 |
Uncertain Tax Positions | 67,374 | 66,775 |
Unfunded Revolver Commitments | 56,792 | 52,066 |
Operating Lease Liabilities | 152,073 | |
Other Liabilities | 219,069 | 244,631 |
Total | $ 3,279,028 | $ 2,743,990 |
Lessee, Lease, Description [Line Items] | ||
Operating lease, maximum extension term | 3 years | |
Operating lease, weighted average remaining lease term | 4 years 9 months 11 days | |
Operating lease, weighted average discount rate | 2.64% | |
Minimum | ||
Lessee, Lease, Description [Line Items] | ||
Operating lease, remaining lease term | 1 year | |
Maximum | ||
Lessee, Lease, Description [Line Items] | ||
Operating lease, remaining lease term | 14 years |
VARIABLE INTEREST ENTITIES - Na
VARIABLE INTEREST ENTITIES - Narrative (Details) $ in Billions | Mar. 31, 2019USD ($) |
Investments in Unconsolidated Investment Funds | |
Variable Interest Entity [Line Items] | |
Commitment to unconsolidated investment funds | $ 2.3 |
VARIABLE INTEREST ENTITIES - Ma
VARIABLE INTEREST ENTITIES - Maximum Exposure to Loss (Details) - Investments in Unconsolidated CLO Vehicles - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Variable Interest Entity [Line Items] | ||
Equity Method - Capital Allocation-Based Income | $ 4,203,980 | $ 3,610,502 |
Due from (to) Affiliates, net | 490,990 | 410,489 |
Maximum Exposure to Loss | $ 4,694,970 | $ 4,020,991 |
DEBT OBLIGATIONS - KKR's Borrow
DEBT OBLIGATIONS - KKR's Borrowings (Details) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Mar. 31, 2019JPY (¥) | |
Debt Instrument [Line Items] | |||
Financing Available | $ 6,401,365,000 | $ 6,042,215,000 | |
Borrowing Outstanding | 22,262,369,000 | 22,341,192,000 | |
Fair Value | 22,350,446,000 | 22,339,640,000 | |
Financing Facilities of Consolidated Funds and Other | |||
Debt Instrument [Line Items] | |||
Financing Available | 4,216,970,000 | 3,840,877,000 | |
Borrowing Outstanding | 4,534,329,000 | 5,123,768,000 | |
Fair Value | $ 4,534,329,000 | $ 5,123,768,000 | |
Weighted average interest rate (percentage) | 4.90% | 4.60% | 4.90% |
Weighted average remaining maturity (in years) | 3 years 7 months 6 days | 3 years 3 months 6 days | |
Debt Obligations of Consolidated CFEs | |||
Debt Instrument [Line Items] | |||
Borrowing Outstanding | $ 14,472,392,000 | ||
Senior Notes | KKR Issued 6.375% Notes Due 2020 | |||
Debt Instrument [Line Items] | |||
Borrowing Outstanding | 499,122,000 | $ 498,975,000 | |
Fair Value | 523,900,000 | 523,500,000 | |
Aggregate principal amount | $ 500,000,000 | ||
Interest rate, stated percentage | 6.375% | 6.375% | |
Unamortized debt issuance costs | $ 600,000 | 700,000 | |
Senior Notes | KKR Issued 5.500% Notes Due 2043 | |||
Debt Instrument [Line Items] | |||
Borrowing Outstanding | 491,921,000 | 491,836,000 | |
Fair Value | 537,235,000 | 508,615,000 | |
Aggregate principal amount | $ 500,000,000 | ||
Interest rate, stated percentage | 5.50% | 5.50% | |
Unamortized debt issuance costs | $ 3,500,000 | 3,600,000 | |
Senior Notes | KKR Issued 5.125% Notes Due 2044 | |||
Debt Instrument [Line Items] | |||
Borrowing Outstanding | 990,831,000 | 990,740,000 | |
Fair Value | 1,030,140,000 | 974,320,000 | |
Aggregate principal amount | $ 1,000,000,000 | ||
Interest rate, stated percentage | 5.125% | 5.125% | |
Unamortized debt issuance costs | $ 7,900,000 | 8,000,000 | |
Senior Notes | KKR Issued 0.509% Notes Due 2023 | |||
Debt Instrument [Line Items] | |||
Borrowing Outstanding | 224,386,000 | 226,895,000 | |
Fair Value | 223,695,000 | 227,298,000 | |
Aggregate principal amount | $ 225,600,000 | ¥ 25,000,000,000 | |
Interest rate, stated percentage | 0.509% | 0.509% | |
Unamortized debt issuance costs | $ 1,200,000 | 1,300,000 | |
Senior Notes | KKR Issued 0.764% Notes Due 2025 | |||
Debt Instrument [Line Items] | |||
Borrowing Outstanding | 44,435,000 | 44,923,000 | |
Fair Value | 45,402,000 | 45,161,000 | |
Aggregate principal amount | $ 45,100,000 | ¥ 5,000,000,000 | |
Interest rate, stated percentage | 0.764% | 0.764% | |
Unamortized debt issuance costs | $ 700,000 | 700,000 | |
Senior Notes | KKR Issued 1.595% Notes Due 2038 | |||
Debt Instrument [Line Items] | |||
Borrowing Outstanding | 91,767,000 | 92,817,000 | |
Fair Value | 96,510,000 | 94,568,000 | |
Aggregate principal amount | $ 92,900,000 | ¥ 10,300,000,000 | |
Interest rate, stated percentage | 1.595% | 1.595% | |
Unamortized debt issuance costs | $ 1,200,000 | 1,200,000 | |
Senior Notes | KFN Issued 5.500% Notes Due 2032 | KFN | |||
Debt Instrument [Line Items] | |||
Borrowing Outstanding | 493,689,000 | 493,568,000 | |
Fair Value | 502,524,000 | 496,359,000 | |
Aggregate principal amount | $ 500,000,000 | ||
Interest rate, stated percentage | 5.50% | 5.50% | |
Unamortized debt issuance costs | $ 4,300,000 | 4,400,000 | |
Senior Notes | KFN Issued 5.200% Notes Due 2033 | KFN | |||
Debt Instrument [Line Items] | |||
Borrowing Outstanding | 118,321,000 | 118,291,000 | |
Fair Value | 117,152,000 | 115,582,000 | |
Aggregate principal amount | $ 120,000,000 | ||
Interest rate, stated percentage | 5.20% | 5.20% | |
Unamortized debt issuance costs | $ 1,700,000 | 1,700,000 | |
Senior Notes | KFN Issued 5.400% Notes Due 2033 | KFN | |||
Debt Instrument [Line Items] | |||
Borrowing Outstanding | 68,705,000 | 68,683,000 | |
Fair Value | 69,689,000 | 68,780,000 | |
Aggregate principal amount | $ 70,000,000 | ||
Interest rate, stated percentage | 5.40% | 5.40% | |
Unamortized debt issuance costs | $ 1,300,000 | 1,300,000 | |
Senior Notes | KFN Issued Junior Subordinated Notes | KFN | |||
Debt Instrument [Line Items] | |||
Borrowing Outstanding | 232,471,000 | 232,142,000 | |
Fair Value | 197,478,000 | $ 203,135,000 | |
Aggregate principal amount | $ 258,500,000 | ||
Weighted average interest rate (percentage) | 5.20% | 5.00% | 5.20% |
Weighted average remaining maturity (in years) | 17 years 6 months | 17 years 9 months 18 days | |
Senior Secured Notes | Debt Obligations of Consolidated CFEs | |||
Debt Instrument [Line Items] | |||
Borrowing Outstanding | $ 12,155,621,000 | $ 11,667,970,000 | |
Fair Value | $ 12,155,621,000 | 11,667,970,000 | |
Weighted average interest rate (percentage) | 3.40% | 3.40% | |
Weighted average remaining maturity (in years) | 11 years 6 months | ||
Subordinated Notes | Debt Obligations of Consolidated CFEs | |||
Debt Instrument [Line Items] | |||
Borrowing Outstanding | $ 402,200,000 | 413,801,000 | |
Fair Value | $ 402,200,000 | 413,801,000 | |
Weighted average remaining maturity (in years) | 11 years 8 months 12 days | ||
Collateralized Mortgage Backed Securities | |||
Debt Instrument [Line Items] | |||
Borrowing Outstanding | $ 1,914,571,000 | 1,876,783,000 | |
Fair Value | $ 1,914,571,000 | 1,876,783,000 | |
Collateralized Mortgage Backed Securities | Debt Obligations of Consolidated CFEs | |||
Debt Instrument [Line Items] | |||
Weighted average interest rate (percentage) | 4.00% | 4.00% | |
Weighted average remaining maturity (in years) | 24 years 6 months | ||
Revolving Credit Facility | Corporate Credit Agreement | |||
Debt Instrument [Line Items] | |||
Financing Available | $ 1,000,000,000 | 1,000,000,000 | |
Borrowing Outstanding | 0 | 0 | |
Fair Value | 0 | 0 | |
Revolving Credit Facility | KCM Credit Agreement | |||
Debt Instrument [Line Items] | |||
Financing Available | 434,395,000 | 451,338,000 | |
Borrowing Outstanding | 0 | 0 | |
Fair Value | 0 | 0 | |
Revolving Credit Facility | KCM Short-Term Credit Agreement | |||
Debt Instrument [Line Items] | |||
Financing Available | 750,000,000 | 750,000,000 | |
Borrowing Outstanding | 0 | 0 | |
Fair Value | $ 0 | $ 0 |
DEBT OBLIGATIONS - Narrative (D
DEBT OBLIGATIONS - Narrative (Details) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 | Mar. 31, 2018 |
Debt Instrument [Line Items] | |||
Borrowing Outstanding | $ 22,262,369,000 | $ 22,341,192,000 | |
Assets | 52,004,019,000 | 50,743,375,000 | $ 47,579,153,000 |
KCM Credit Agreement | |||
Debt Instrument [Line Items] | |||
Line of credit facility, maximum borrowing capacity | 500,000,000 | ||
KCM Credit Agreement | Letter of Credit | |||
Debt Instrument [Line Items] | |||
Line of credit facility, maximum borrowing capacity | 500,000,000 | ||
Letters of credit outstanding | 65,600,000 | 48,700,000 | |
Revolving Credit Facility | KCM Credit Agreement | |||
Debt Instrument [Line Items] | |||
Borrowing Outstanding | 0 | 0 | |
Consolidated VIEs | |||
Debt Instrument [Line Items] | |||
Borrowing Outstanding | 15,496,761,000 | 15,351,541,000 | |
Assets | 31,479,173,000 | 31,481,330,000 | |
Consolidated VIEs | Consolidated CFEs | |||
Debt Instrument [Line Items] | |||
Borrowing Outstanding | 14,472,392,000 | 13,958,554,000 | |
Assets | $ 15,829,403,000 | $ 15,310,494,000 |
INCOME TAXES - Narrative (Detai
INCOME TAXES - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Jul. 01, 2018 | |
Income Tax Disclosure [Abstract] | |||
Deferred tax asset related to partial step-up in disposal of assets | $ 257,100 | ||
Deferred tax asset related to partial step-up in disposal of assets, additional amount | $ 45,000 | ||
Effective income tax rate | 9.34% | 2.84% | |
Increase in uncertain tax positions within 12 months | $ 0 | ||
Decrease in uncertain tax positions within 12 months | $ 0 |
EQUITY BASED COMPENSATION - Exp
EQUITY BASED COMPENSATION - Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Compensation and Benefits | ||
Expense associated with equity based compensation | ||
Equity based expenses | $ 78,551 | $ 95,078 |
Compensation and Benefits | KKR Holdings Principal Awards | ||
Expense associated with equity based compensation | ||
Equity based expenses | 23,666 | 27,282 |
Compensation and Benefits | Equity Incentive Plan Awards | ||
Expense associated with equity based compensation | ||
Equity based expenses | 54,885 | 67,796 |
Equity method investments | Net Gains (Losses) From Investment Activities | ||
Expense associated with equity based compensation | ||
Equity based expenses | $ (300) | $ 4,300 |
EQUITY BASED COMPENSATION - Nar
EQUITY BASED COMPENSATION - Narrative (Details) $ / shares in Units, $ in Millions | Nov. 02, 2017$ / sharesshares | Nov. 30, 2016USD ($) | Feb. 29, 2016shares | Mar. 31, 2019USD ($)shares | Mar. 31, 2018shares |
KKR Group Partnerships | |||||
Equity Based Payments | |||||
Percentage owned by KKR Holdings L.P. | 40.50% | ||||
KKR Holdings Principal Awards | |||||
Equity Based Payments | |||||
Vesting period (in years) | 5 years | ||||
Minimum transfer restriction period with respect to one-half awards vested (in years) | 1 year | ||||
Portion of awards vested having one-year transfer restriction period (as a percent) | 50.00% | ||||
Minimum transfer restriction period with respect to remaining one-half awards vested (in years) | 2 years | ||||
Portion of awards vested having two-year transfer restriction period (as a percent) | 50.00% | ||||
Minimum retained ownership required to continuously hold common share equivalents to as percentage of cumulatively vested interests | 25.00% | ||||
Forfeiture rate assumed (as a percent) | 7.00% | ||||
Estimated unrecognized equity-based payment expense | $ | $ 320.9 | $ 230.3 | |||
Weighted average remaining vesting period over which unvested units are expected to vest (in years) | 1 year 7 months 31 days | ||||
Common units conversion basis | 1 | ||||
Number of common units owned in KKR Group Partnership Units (in units) | shares | 298,645,285 | 333,648,078 | |||
Percentage of outstanding units not granted (less than) | 0.60% | ||||
Modified awards granted (in units) | shares | 28,900,000 | ||||
KKR Holdings Principal Awards | Minimum | |||||
Equity Based Payments | |||||
Vesting period (in years) | 3 years | ||||
KKR Holdings Principal Awards | Maximum | |||||
Equity Based Payments | |||||
Vesting period (in years) | 5 years | ||||
Equity Incentive Plan Shares | |||||
Equity Based Payments | |||||
Total awards issuable as a percentage of diluted common stock outstanding | 15.00% | ||||
Minimum retained ownership required to continuously hold common share equivalents to as percentage of cumulatively vested interests | 15.00% | ||||
Forfeiture rate assumed (as a percent) | 7.00% | ||||
Estimated unrecognized equity-based payment expense | $ | $ 340.4 | ||||
Weighted average remaining vesting period over which unvested units are expected to vest (in years) | 1 year 1 month 4 days | ||||
Equity Incentive Plan Shares | Minimum | |||||
Equity Based Payments | |||||
Vesting period (in years) | 3 years | ||||
Discount rate (as a percent) | 8.00% | ||||
Equity Incentive Plan Shares | Maximum | |||||
Equity Based Payments | |||||
Vesting period (in years) | 5 years | ||||
Discount rate (as a percent) | 56.00% | ||||
Equity Incentive Plan Shares | Market Condition Awards | |||||
Equity Based Payments | |||||
Awards granted per individual (in shares) | shares | 2,500,000 | ||||
Performance condition, closing market price (in dollars per share) | $ / shares | $ 40 | ||||
Required term of performance condition | 10 days | ||||
Fair value of award at grant date (in dollars per share) | $ / shares | $ 4.02 | ||||
Compensation expense recognition period | 3 years | ||||
Estimated unrecognized equity-based payment expense | $ | $ 10.7 | ||||
Equity Incentive Plan Shares | KKR Holdings | |||||
Equity Based Payments | |||||
Minimum transfer restriction period with respect to one-half awards vested (in years) | 1 year | ||||
Portion of awards vested having one-year transfer restriction period (as a percent) | 50.00% | ||||
Minimum transfer restriction period with respect to remaining one-half awards vested (in years) | 2 years | ||||
Portion of awards vested having two-year transfer restriction period (as a percent) | 50.00% | ||||
KKR Group Partnerships | KKR Holdings | |||||
Equity Based Payments | |||||
Percentage owned by KKR Holdings L.P. | 35.90% |
EQUITY BASED COMPENSATION - Dis
EQUITY BASED COMPENSATION - Discount Per Share for Lack of Participation Rights in Expected Dividends (Details) - $ / shares | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | |
Mar. 31, 2019 | Jun. 30, 2018 | Mar. 31, 2019 | Dec. 31, 2017 | Dec. 31, 2016 | |
Dividends Payable [Line Items] | |||||
Annual discount per share (in dollars per share) | $ 0.125 | ||||
Class A Common Stock | |||||
Dividends Payable [Line Items] | |||||
Annual discount per share (in dollars per share) | $ 0.68 | $ 0.50 | $ 0.68 | $ 0.64 |
EQUITY BASED COMPENSATION - Mar
EQUITY BASED COMPENSATION - Market Condition Awards (Details) - Equity Incentive Plan Shares - Market Condition Awards | 3 Months Ended |
Mar. 31, 2019$ / shares | |
Equity Based Payments | |
Closing KKR share price as of valuation date (in dollars per share) | $ 19.90 |
Risk Free Rate | 2.02% |
Volatility | 25.00% |
Dividend Yield | 3.42% |
Expected Cost of Equity | 11.02% |
EQUITY BASED COMPENSATION - Est
EQUITY BASED COMPENSATION - Estimated Unrecognized Expense (Details) - USD ($) $ in Millions | Mar. 31, 2019 | Nov. 30, 2016 |
Equity Incentive Plan Shares | ||
Equity Based Payments | ||
Estimated unrecognized equity-based payment expense | $ 340.4 | |
Equity Incentive Plan Shares | Remainder of 2019 | ||
Equity Based Payments | ||
Estimated unrecognized equity-based payment expense | 132.8 | |
Equity Incentive Plan Shares | 2020 | ||
Equity Based Payments | ||
Estimated unrecognized equity-based payment expense | 131.8 | |
Equity Incentive Plan Shares | 2021 | ||
Equity Based Payments | ||
Estimated unrecognized equity-based payment expense | 58.5 | |
Equity Incentive Plan Shares | 2022 | ||
Equity Based Payments | ||
Estimated unrecognized equity-based payment expense | 16.4 | |
Equity Incentive Plan Shares | 2023 | ||
Equity Based Payments | ||
Estimated unrecognized equity-based payment expense | 0.9 | |
KKR Holdings Principal Awards | ||
Equity Based Payments | ||
Estimated unrecognized equity-based payment expense | 230.3 | $ 320.9 |
KKR Holdings Principal Awards | Remainder of 2019 | ||
Equity Based Payments | ||
Estimated unrecognized equity-based payment expense | 70.7 | |
KKR Holdings Principal Awards | 2020 | ||
Equity Based Payments | ||
Estimated unrecognized equity-based payment expense | 86.9 | |
KKR Holdings Principal Awards | 2021 | ||
Equity Based Payments | ||
Estimated unrecognized equity-based payment expense | 47.2 | |
KKR Holdings Principal Awards | 2022 | ||
Equity Based Payments | ||
Estimated unrecognized equity-based payment expense | $ 25.5 |
EQUITY BASED COMPENSATION - Awa
EQUITY BASED COMPENSATION - Awards Rollforward (Details) | 3 Months Ended |
Mar. 31, 2019$ / sharesshares | |
KKR Holdings Principal Awards | |
Shares | |
Balance at the beginning of the period (in units) | shares | 24,123,993 |
Granted (in units) | shares | 0 |
Vested (in units) | shares | 0 |
Forfeitures (in units) | shares | (270,000) |
Balance at the end of the period (in units) | shares | 23,853,993 |
Weighted Average Grant Date Fair Value | |
Balance at the beginning of the period (in dollars per unit) | $ / shares | $ 14.42 |
Granted (in dollars per unit) | $ / shares | 0 |
Vested (in dollars per unit) | $ / shares | 0 |
Forfeitures (in dollars per unit) | $ / shares | 16.28 |
Balance at the end of the period (in dollars per unit) | $ / shares | $ 14.40 |
Equity Incentive Plan Shares | |
Shares | |
Balance at the beginning of the period (in units) | shares | 33,400,183 |
Granted (in units) | shares | 50,511 |
Vested (in units) | shares | (15,440) |
Forfeitures (in units) | shares | (604,519) |
Balance at the end of the period (in units) | shares | 32,830,735 |
Weighted Average Grant Date Fair Value | |
Balance at the beginning of the period (in dollars per unit) | $ / shares | $ 16.23 |
Granted (in dollars per unit) | $ / shares | 18.96 |
Vested (in dollars per unit) | $ / shares | 15.83 |
Forfeitures (in dollars per unit) | $ / shares | 17.43 |
Balance at the end of the period (in dollars per unit) | $ / shares | $ 16.21 |
EQUITY BASED COMPENSATION - Rem
EQUITY BASED COMPENSATION - Remaining Vesting Tranches (Details) - shares | Mar. 31, 2019 | Dec. 31, 2018 |
Equity Incentive Plan Shares | ||
Equity Based Payments | ||
Principal units (in units) | 32,830,735 | 33,400,183 |
Equity Incentive Plan Shares | April 1, 2019 | ||
Equity Based Payments | ||
Principal units (in units) | 8,917,856 | |
Equity Incentive Plan Shares | October 1, 2019 | ||
Equity Based Payments | ||
Principal units (in units) | 4,733,416 | |
Equity Incentive Plan Shares | April 1, 2020 | ||
Equity Based Payments | ||
Principal units (in units) | 7,135,649 | |
Equity Incentive Plan Shares | October 1, 2020 | ||
Equity Based Payments | ||
Principal units (in units) | 3,607,073 | |
Equity Incentive Plan Shares | April 1, 2021 | ||
Equity Based Payments | ||
Principal units (in units) | 4,093,420 | |
Equity Incentive Plan Shares | October 1, 2021 | ||
Equity Based Payments | ||
Principal units (in units) | 2,134,028 | |
Equity Incentive Plan Shares | April 1, 2022 | ||
Equity Based Payments | ||
Principal units (in units) | 916,731 | |
Equity Incentive Plan Shares | October 1, 2022 | ||
Equity Based Payments | ||
Principal units (in units) | 1,201,390 | |
Equity Incentive Plan Shares | October 1, 2023 | ||
Equity Based Payments | ||
Principal units (in units) | 91,172 | |
KKR Holdings Principal Awards | ||
Equity Based Payments | ||
Principal units (in units) | 23,853,993 | 24,123,993 |
KKR Holdings Principal Awards | April 1, 2019 | ||
Equity Based Payments | ||
Principal units (in units) | 229,514 | |
KKR Holdings Principal Awards | May 1, 2019 | ||
Equity Based Payments | ||
Principal units (in units) | 3,590,000 | |
KKR Holdings Principal Awards | October 1, 2019 | ||
Equity Based Payments | ||
Principal units (in units) | 2,455,000 | |
KKR Holdings Principal Awards | April 1, 2020 | ||
Equity Based Payments | ||
Principal units (in units) | 124,479 | |
KKR Holdings Principal Awards | May 1, 2020 | ||
Equity Based Payments | ||
Principal units (in units) | 3,590,000 | |
KKR Holdings Principal Awards | October 1, 2020 | ||
Equity Based Payments | ||
Principal units (in units) | 2,940,000 | |
KKR Holdings Principal Awards | May 1, 2021 | ||
Equity Based Payments | ||
Principal units (in units) | 3,590,000 | |
KKR Holdings Principal Awards | October 1, 2021 | ||
Equity Based Payments | ||
Principal units (in units) | 3,425,000 | |
KKR Holdings Principal Awards | October 1, 2022 | ||
Equity Based Payments | ||
Principal units (in units) | 3,910,000 |
RELATED PARTY TRANSACTIONS - Su
RELATED PARTY TRANSACTIONS - Summary of Due From and Due To Affiliates (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Related Party Transaction [Line Items] | ||
Due from Affiliates | $ 734,195 | $ 657,189 |
Due to Affiliates | 254,781 | 275,584 |
Portfolio Companies | ||
Related Party Transaction [Line Items] | ||
Due from Affiliates | 93,855 | 82,204 |
Unconsolidated Investment Funds | ||
Related Party Transaction [Line Items] | ||
Due from Affiliates | 637,501 | 568,211 |
Due to Affiliates | 146,511 | 157,722 |
Related Entities | ||
Related Party Transaction [Line Items] | ||
Due from Affiliates | 2,839 | 6,774 |
Due to KKR Holdings in connection with the tax receivable agreement | ||
Related Party Transaction [Line Items] | ||
Due to Affiliates | $ 108,270 | $ 117,862 |
SEGMENT REPORTING - Financial D
SEGMENT REPORTING - Financial Data for KKR's Reportable Segments (Details) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2019USD ($)segment | Mar. 31, 2018USD ($) | Dec. 31, 2018USD ($) | ||
Segment Reporting [Abstract] | ||||
Number of operating segments | segment | 1 | |||
Management, Monitoring and Transaction Fees, Net | ||||
Fees and Other | $ 372,548 | $ 394,394 | ||
Realized Performance Income (Loss) | ||||
Carried Interest | 694,383 | 62,747 | ||
Investment Income (Loss) | ||||
Total Investment Income (Loss) | 1,335,926 | 584,530 | ||
Total Revenues | 1,187,480 | 472,606 | ||
Segment Expenses | ||||
Compensation and Benefits | 544,562 | 298,136 | ||
Occupancy and Related Charges | 14,690 | 14,215 | ||
Total Expenses | 728,767 | 436,601 | ||
Preferred Dividends | 8,341 | 8,341 | ||
Less: Net Income (Loss) Attributable to Noncontrolling Interests | 917,727 | 398,777 | ||
Income Taxes Paid | 8,901 | 19,295 | ||
After-tax Distributable Earnings | 700,978 | 170,102 | ||
Assets | 52,004,019 | 47,579,153 | $ 50,743,375 | |
Segment Liabilities | 25,796,178 | 25,810,215 | 25,360,766 | |
Segment Book Value | [1] | 9,322,371 | $ 8,649,610 | |
Reportable segments | ||||
Management, Monitoring and Transaction Fees, Net | ||||
Fees and Other | 397,258 | 382,186 | ||
Realized Performance Income (Loss) | ||||
Carried Interest | 330,345 | 202,555 | ||
Incentive Fees | 19,537 | 16,407 | ||
Total Realized Performance Income (Loss) | 349,882 | 218,962 | ||
Investment Income (Loss) | ||||
Net Realized Gains (Losses) | 44,712 | 7,875 | ||
Interest Income and Dividends | 58,207 | 72,577 | ||
Total Investment Income (Loss) | 102,919 | 80,452 | ||
Total Revenues | 850,059 | 681,600 | ||
Segment Expenses | ||||
Compensation and Benefits | 340,286 | 300,480 | ||
Occupancy and Related Charges | 13,957 | 13,583 | ||
Other Operating Expenses | 74,910 | 57,905 | ||
Total Expenses | 429,153 | 371,968 | ||
Segment Operating Earnings | 420,906 | 309,632 | ||
Interest Expense | 44,130 | 50,192 | ||
Preferred Dividends | 8,341 | 8,341 | ||
Less: Net Income (Loss) Attributable to Noncontrolling Interests | 359 | 1,203 | ||
Income Taxes Paid | 53,993 | 14,168 | ||
After-tax Distributable Earnings | 314,083 | 235,728 | ||
Assets | 18,770,564 | 16,243,603 | ||
Segment Liabilities | 4,100,354 | 3,736,797 | ||
Segment Book Value | 14,148,206 | 11,983,289 | ||
Management Fees | ||||
Management, Monitoring and Transaction Fees, Net | ||||
Fees and Other | 188,408 | 187,727 | ||
Management Fees | Reportable segments | ||||
Management, Monitoring and Transaction Fees, Net | ||||
Fees and Other | 292,296 | 251,585 | ||
Transaction Fees | ||||
Management, Monitoring and Transaction Fees, Net | ||||
Fees and Other | 188,203 | 158,653 | ||
Transaction Fees | Reportable segments | ||||
Management, Monitoring and Transaction Fees, Net | ||||
Fees and Other | 186,727 | 156,845 | ||
Monitoring Fees | ||||
Management, Monitoring and Transaction Fees, Net | ||||
Fees and Other | 25,651 | 17,586 | ||
Monitoring Fees | Reportable segments | ||||
Management, Monitoring and Transaction Fees, Net | ||||
Fees and Other | 25,651 | 17,530 | ||
Fee Credits | ||||
Management, Monitoring and Transaction Fees, Net | ||||
Fees and Other | (103,477) | (29,053) | ||
Fee Credits | Reportable segments | ||||
Management, Monitoring and Transaction Fees, Net | ||||
Fees and Other | (107,416) | (43,774) | ||
Compensation and Benefits | ||||
Segment Expenses | ||||
Equity based expenses | 78,551 | 95,078 | ||
Equity Incentive Plan Awards | Compensation and Benefits | ||||
Segment Expenses | ||||
Equity based expenses | $ 54,885 | $ 67,796 | ||
[1] | See Note 1 "Organization." |
SEGMENT REPORTING - Revenues Di
SEGMENT REPORTING - Revenues Disaggregated By Business Line (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Fees and Other | $ 372,548 | $ 394,394 |
Carried Interest | 694,383 | 62,747 |
Total Investment Income (Loss) | 1,335,926 | 584,530 |
Total Revenues | 1,187,480 | 472,606 |
Reportable segments | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Fees and Other | 397,258 | 382,186 |
Carried Interest | 330,345 | 202,555 |
Incentive Fees | 19,537 | 16,407 |
Total Realized Performance Income (Loss) | 349,882 | 218,962 |
Net Realized Gains (Losses) | 44,712 | 7,875 |
Interest Income and Dividends | 58,207 | 72,577 |
Total Investment Income (Loss) | 102,919 | 80,452 |
Total Revenues | 850,059 | 681,600 |
Private Markets Business Line | Reportable segments | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Fees and Other | 225,547 | 181,066 |
Carried Interest | 330,345 | 202,555 |
Incentive Fees | 675 | 0 |
Total Realized Performance Income (Loss) | 331,020 | 202,555 |
Net Realized Gains (Losses) | 0 | 0 |
Interest Income and Dividends | 0 | 0 |
Total Investment Income (Loss) | 0 | 0 |
Total Revenues | 556,567 | 383,621 |
Public Markets Business Line | Reportable segments | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Fees and Other | 111,457 | 93,522 |
Carried Interest | 0 | 0 |
Incentive Fees | 18,862 | 16,407 |
Total Realized Performance Income (Loss) | 18,862 | 16,407 |
Net Realized Gains (Losses) | 0 | 0 |
Interest Income and Dividends | 0 | 0 |
Total Investment Income (Loss) | 0 | 0 |
Total Revenues | 130,319 | 109,929 |
Capital Markets Business Line | Reportable segments | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Fees and Other | 60,254 | 107,598 |
Carried Interest | 0 | 0 |
Incentive Fees | 0 | 0 |
Total Realized Performance Income (Loss) | 0 | 0 |
Net Realized Gains (Losses) | 0 | 0 |
Interest Income and Dividends | 0 | 0 |
Total Investment Income (Loss) | 0 | 0 |
Total Revenues | 60,254 | 107,598 |
Principal Activities Business Line | Reportable segments | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Fees and Other | 0 | 0 |
Carried Interest | 0 | 0 |
Incentive Fees | 0 | 0 |
Total Realized Performance Income (Loss) | 0 | 0 |
Net Realized Gains (Losses) | 44,712 | 7,875 |
Interest Income and Dividends | 58,207 | 72,577 |
Total Investment Income (Loss) | 102,919 | 80,452 |
Total Revenues | 102,919 | 80,452 |
Management Fees | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Fees and Other | 188,408 | 187,727 |
Management Fees | Reportable segments | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Fees and Other | 292,296 | 251,585 |
Management Fees | Private Markets Business Line | Reportable segments | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Fees and Other | 183,221 | 158,190 |
Management Fees | Public Markets Business Line | Reportable segments | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Fees and Other | 109,075 | 93,395 |
Management Fees | Capital Markets Business Line | Reportable segments | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Fees and Other | 0 | 0 |
Management Fees | Principal Activities Business Line | Reportable segments | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Fees and Other | 0 | 0 |
Transaction Fees | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Fees and Other | 188,203 | 158,653 |
Transaction Fees | Reportable segments | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Fees and Other | 186,727 | 156,845 |
Transaction Fees | Private Markets Business Line | Reportable segments | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Fees and Other | 99,017 | 46,689 |
Transaction Fees | Public Markets Business Line | Reportable segments | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Fees and Other | 27,456 | 2,558 |
Transaction Fees | Capital Markets Business Line | Reportable segments | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Fees and Other | 60,254 | 107,598 |
Transaction Fees | Principal Activities Business Line | Reportable segments | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Fees and Other | 0 | 0 |
Monitoring Fees | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Fees and Other | 25,651 | 17,586 |
Monitoring Fees | Reportable segments | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Fees and Other | 25,651 | 17,530 |
Monitoring Fees | Private Markets Business Line | Reportable segments | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Fees and Other | 25,651 | 17,530 |
Monitoring Fees | Public Markets Business Line | Reportable segments | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Fees and Other | 0 | 0 |
Monitoring Fees | Capital Markets Business Line | Reportable segments | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Fees and Other | 0 | 0 |
Monitoring Fees | Principal Activities Business Line | Reportable segments | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Fees and Other | 0 | 0 |
Fee Credits | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Fees and Other | (103,477) | (29,053) |
Fee Credits | Reportable segments | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Fees and Other | (107,416) | (43,774) |
Fee Credits | Private Markets Business Line | Reportable segments | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Fees and Other | (82,342) | (41,343) |
Fee Credits | Public Markets Business Line | Reportable segments | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Fees and Other | (25,074) | (2,431) |
Fee Credits | Capital Markets Business Line | Reportable segments | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Fees and Other | 0 | 0 |
Fee Credits | Principal Activities Business Line | Reportable segments | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Fees and Other | $ 0 | $ 0 |
SEGMENT REPORTING - Revenues (D
SEGMENT REPORTING - Revenues (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Segment Reporting Information [Line Items] | ||
Revenues | $ 1,187,480 | $ 472,606 |
Deduct: Capital Allocation-Based Income (GAAP) | 814,932 | 78,212 |
Add: Segment Realized Carried Interest | 694,383 | 62,747 |
Add: Segment Realized Investment Income (Loss) | 1,335,926 | 584,530 |
Segment Reconciling Items | ||
Segment Reporting Information [Line Items] | ||
Add: Management Fees - Consolidated Funds and Other | 121,949 | 64,596 |
Deduct: Fee Credits - Consolidated Funds | 3,939 | 14,721 |
Deduct: Capital Allocation-Based Income (GAAP) | 814,932 | 78,212 |
Add: Segment Realized Carried Interest | 330,345 | 202,555 |
Add: Segment Realized Investment Income (Loss) | 102,919 | 80,452 |
Deduct: Revenue Earned by Other Consolidated Entities | 29,703 | 25,465 |
Deduct: Expense Reimbursements | 44,060 | 20,211 |
Reportable segments | ||
Segment Reporting Information [Line Items] | ||
Revenues | 850,059 | 681,600 |
Add: Segment Realized Carried Interest | 330,345 | 202,555 |
Add: Segment Realized Investment Income (Loss) | $ 102,919 | $ 80,452 |
SEGMENT REPORTING - Expenses (D
SEGMENT REPORTING - Expenses (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Segment Reporting Information [Line Items] | ||
Total Segment Expenses | $ 728,767 | $ 436,601 |
Deduct: Amortization of Intangibles | 500 | 5,000 |
Segment Reconciling Items | ||
Segment Reporting Information [Line Items] | ||
Deduct: Equity-based and Other Compensation - KKR Holdings L.P. | 23,743 | 32,695 |
Deduct: Segment Unrealized Performance Income Compensation | 159,880 | (43,123) |
Deduct: Amortization of Intangibles | 535 | 5,030 |
Deduct: Reimbursable Expenses | 52,032 | 26,093 |
Deduct: Operating Expenses relating to Other Consolidated Entities | 51,818 | 44,309 |
Add: Other | (11,606) | 371 |
Reportable segments | ||
Segment Reporting Information [Line Items] | ||
Total Segment Expenses | $ 429,153 | $ 371,968 |
SEGMENT REPORTING - Income (Los
SEGMENT REPORTING - Income (Loss) Before Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Segment Reporting Information [Line Items] | ||
Net Income (Loss) Attributable to KKR & Co. Inc. Class A Common Stockholders | $ 700,978 | $ 170,102 |
Add: Equity-based and Other Compensation - KKR Holdings L.P. | 78,268 | 96,227 |
Deduct: Net Unrealized Gains (Losses) | 1,074,097 | 442,420 |
Add: Income Tax Provision | 167,593 | 17,641 |
Income Taxes Paid | 8,901 | 19,295 |
Segment Reconciling Items | ||
Segment Reporting Information [Line Items] | ||
Add: Net Income (Loss) Attributable to Noncontrolling Interests held by KKR Holdings L.P. | 481,368 | 121,002 |
Add: Equity-based and Other Compensation - KKR Holdings L.P. | 23,118 | 32,695 |
Add: Amortization of Intangibles and Other, net | 56,153 | 47,709 |
Deduct: Unrealized Carried Interest | 401,612 | (111,732) |
Deduct: Net Unrealized Gains (Losses) | 819,402 | 207,862 |
Add: Unrealized Performance Income Compensation | 159,880 | (43,123) |
Add: Income Tax Provision | 167,593 | 17,641 |
Income Taxes Paid | 53,993 | 14,168 |
Reportable segments | ||
Segment Reporting Information [Line Items] | ||
Net Income (Loss) Attributable to KKR & Co. Inc. Class A Common Stockholders | 314,083 | 235,728 |
Income Taxes Paid | $ 53,993 | $ 14,168 |
SEGMENT REPORTING - Reconciliat
SEGMENT REPORTING - Reconciliation of Assets from Segment to Consolidated (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 | Mar. 31, 2018 |
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total Assets | $ 52,004,019 | $ 50,743,375 | $ 47,579,153 |
Carry Pool Reclassification | 1,089,045 | 922,977 | |
Impact of KKR Management Holdings Corp. | 2,687,802 | $ 2,536,692 | |
Segment Reconciling Items | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Impact of Consolidation of Investment Vehicles and Other Entities | (31,561,635) | (29,972,064) | |
Carry Pool Reclassification | (1,089,045) | (1,176,070) | |
Other Reclassifications | (582,775) | 0 | |
Impact of KKR Management Holdings Corp. | 0 | (187,416) | |
Reportable segments | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total Assets | $ 18,770,564 | $ 16,243,603 |
SEGMENT REPORTING - Reconcili_2
SEGMENT REPORTING - Reconciliation of Liabilities from Segment to Consolidated (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 | Mar. 31, 2018 |
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||
Segment Liabilities | $ 25,796,178 | $ 25,360,766 | $ 25,810,215 |
Carry Pool Reclassification | 1,089,045 | $ 922,977 | |
Segment Reconciling Items | |||
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||
Impact of Consolidation of Investment Vehicles and Other Entities | (20,024,004) | (20,775,320) | |
Carry Pool Reclassification | (1,089,045) | (1,176,070) | |
Other Reclassifications | (582,775) | 0 | |
Impact of KKR Management Holdings Corp. | 0 | (122,028) | |
Reportable segments | |||
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||
Segment Liabilities | $ 4,100,354 | $ 3,736,797 |
SEGMENT REPORTING - Reconcili_3
SEGMENT REPORTING - Reconciliation of Stockholders' Equity from Segment to Consolidated (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Mar. 31, 2018 |
Segment Reporting, Other Significant Reconciling Item [Line Items] | ||
KKR & Co. Inc. Stockholders' Equity - Common Stockholders | $ 8,839,817 | $ 6,918,185 |
Segment Reconciling Items | ||
Segment Reporting, Other Significant Reconciling Item [Line Items] | ||
Impact of Consolidation of Investment Vehicles and Other Entities | 246,793 | 254,777 |
Other Reclassifications | (17,446) | (17,446) |
Noncontrolling Interests Held by KKR Holdings L.P. | 5,079,042 | 4,893,161 |
Impact of KKR Management Holdings Corp. | 0 | (65,388) |
Reportable segments | ||
Segment Reporting, Other Significant Reconciling Item [Line Items] | ||
KKR & Co. Inc. Stockholders' Equity - Common Stockholders | $ 14,148,206 | $ 11,983,289 |
EQUITY - Narrative (Details)
EQUITY - Narrative (Details) | 12 Months Ended |
Dec. 31, 2015 | |
Equity [Abstract] | |
Percentage of carried interest received by general partners (up to) | 1.00% |
EQUITY - Repurchase Program (De
EQUITY - Repurchase Program (Details) - 2015 Unit Repurchase Program - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Class of Stock [Line Items] | ||
Unit repurchase program, authorized amount | $ 500,000,000 | |
Class A Common Stock | ||
Class of Stock [Line Items] | ||
Stock repurchased (in shares) | 1,400,000 | |
Stock retired (in shares) | 0 | 0 |
EQUITY - Noncontrolling Interes
EQUITY - Noncontrolling Interests Held by KKR Holdings (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||
Capital contributions | $ 1,270,723 | |
Capital distributions | (930,232) | |
KKR Holdings | ||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||
Net income (loss) attributable to noncontrolling interests | $ 481,368 | 121,002 |
Noncontrolling Interests | ||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||
Balance at the beginning of the period | 15,610,358 | |
Net income (loss) attributable to noncontrolling interests | 917,727 | |
Other comprehensive income (loss), net of tax | 2,632 | |
Exchange of KKR Holdings Units to Class A Common Stock and Other | (7,094) | |
Equity-based and other non-cash compensation | 23,118 | |
Capital contributions | 1,194,815 | 1,270,723 |
Capital distributions | (856,086) | $ (839,134) |
Balance at the end of the period | 16,885,470 | |
Noncontrolling Interests | Noncontrolling Interests in Consolidated Entities | ||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||
Balance at the beginning of the period | 10,984,910 | |
Net income (loss) attributable to noncontrolling interests | 436,359 | |
Other comprehensive income (loss), net of tax | 2,511 | |
Exchange of KKR Holdings Units to Class A Common Stock and Other | 0 | |
Equity-based and other non-cash compensation | 0 | |
Capital contributions | 1,194,792 | |
Capital distributions | (812,144) | |
Balance at the end of the period | 11,806,428 | |
Noncontrolling Interests | KKR Holdings | ||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||
Balance at the beginning of the period | 4,625,448 | |
Net income (loss) attributable to noncontrolling interests | 481,368 | |
Other comprehensive income (loss), net of tax | 121 | |
Exchange of KKR Holdings Units to Class A Common Stock and Other | (7,094) | |
Equity-based and other non-cash compensation | 23,118 | |
Capital contributions | 23 | |
Capital distributions | (43,942) | |
Balance at the end of the period | $ 5,079,042 |
EQUITY - Net Income (Loss) Attr
EQUITY - Net Income (Loss) Attributable To Noncontrolling Interests Held by KKR Holdings (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||
Net Income (Loss) | $ 1,627,046 | $ 602,894 |
Less: Net Income (Loss) Attributable to Redeemable Noncontrolling Interests | 0 | 25,674 |
Less: Net income (loss) attributable to Noncontrolling Interests in consolidated entities | 436,359 | 277,775 |
Less: Preferred Stock Dividends | 8,341 | 8,341 |
Plus: Income tax expense (benefit) attributable to KKR & Co. Inc. | 158,962 | 6,068 |
Net income (loss) attributable to KKR & Co. L.P. Common Unitholders and KKR Holdings | 1,341,308 | 297,172 |
KKR Holdings | ||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||
Net income (loss) attributable to noncontrolling interests | $ 481,368 | $ 121,002 |
EQUITY - Redeemable Noncontroll
EQUITY - Redeemable Noncontrolling Interests (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Increase (Decrease) in Redeemable Noncontrolling Interests | |
Balance | $ 1,122,641 |
Changes in consolidation | (1,122,641) |
Balance | $ 0 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Contingent Repayment Guarantees (Details) | Mar. 31, 2019USD ($) |
Contingent Repayment Guarantees | |
Private equity fund carried interest amount subject to clawback provision assuming liquidation at fair value | $ 0 |
Liquidation value for clawback obligation | 0 |
Clawback obligation amount if private equity vehicles liquidated at fair value | 2,100,000,000 |
KKR | |
Investment Commitments | |
Unfunded commitments | 5,086,900,000 |
Principal Activities | |
Investment Commitments | |
Unfunded commitments | 153,700,000 |
Capital Markets | |
Investment Commitments | |
Unfunded commitments | $ 516,200,000 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES - Minimum Future Lease Payments (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Operating Lease Liabilities, Payments Due [Abstract] | ||
April 2019 - March 2020 | $ 50,312 | |
April 2020 - March 2022 | 66,055 | |
April 2022 - March 2024 | 26,828 | |
April 2024 and thereafter | 18,855 | |
Total minimum payments required | 162,050 | |
Less: Imputed Interest | (9,977) | |
Total operating lease liabilities | 152,073 | |
Lessee, Operating Lease, Not yet Commenced, Description [Abstract] | ||
Future lease payments for lease not yet commenced | $ 87,200 | |
Term of lease not yet commenced | 15 years | |
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | ||
2019 | $ 50,649 | |
2020-2021 | 69,263 | |
2022-2023 | 29,687 | |
2024 and thereafter | 76,332 | |
Total minimum payments required | $ 225,931 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - $ / shares | Apr. 30, 2019 | Mar. 31, 2019 |
Subsequent Events | ||
Dividend declared (in dollars per share) | $ 0.125 | |
Subsequent Event | Common Stock | ||
Subsequent Events | ||
Dividend declared (in dollars per share) | $ 0.125 | |
Subsequent Event | Series A Preferred Stock | ||
Subsequent Events | ||
Dividend declared (in dollars per share) | 0.421875 | |
Subsequent Event | Series B Preferred Stock | ||
Subsequent Events | ||
Dividend declared (in dollars per share) | $ 0.406250 |