Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | ||
Mar. 31, 2014 | 16-May-14 | 16-May-14 | |
Class A common stock | Class B common stock | ||
Entity Registrant Name | 'Moelis & Co | ' | ' |
Entity Central Index Key | '0001596967 | ' | ' |
Document Type | '10-Q | ' | ' |
Document Period End Date | 31-Mar-14 | ' | ' |
Amendment Flag | 'false | ' | ' |
Current Fiscal Year End Date | '--12-31 | ' | ' |
Entity Filer Category | 'Non-accelerated Filer | ' | ' |
Entity Common Stock, Shares Outstanding | ' | 15,159,961 | 36,158,698 |
Document Fiscal Year Focus | '2014 | ' | ' |
Document Fiscal Period Focus | 'Q1 | ' | ' |
Condensed_Combined_Statements_
Condensed Combined Statements of Financial Condition (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Assets | ' | ' |
Cash and cash equivalents | $263,366 | $303,024 |
Restricted cash | 799 | 792 |
Receivables: | ' | ' |
Accounts receivable, net of allowance for doubtful accounts of $1,728 and $773 as of 2014 and 2013, respectively | 29,341 | 28,784 |
Other receivables, net of allowance for doubtful accounts of $723 and $1,080 as of 2014 and 2013, respectively | 5,559 | 6,559 |
Total receivables | 34,900 | 35,343 |
Deferred compensation | 9,344 | 3,495 |
Investments at fair value (cost basis $69,066 as of 2013) | ' | 68,141 |
Investment in joint venture | 15,657 | 12,481 |
Equipment and leasehold improvements, net | 5,347 | 5,156 |
Deferred tax asset | 1,315 | 1,315 |
Prepaid expenses and other assets | 19,707 | 13,716 |
Total assets | 350,435 | 443,463 |
Liabilities and Parent Company Equity | ' | ' |
Compensation payable | 35,092 | 104,527 |
Accounts payable and accrued expenses | 14,649 | 14,262 |
Deferred revenue | 8,135 | 6,838 |
Other liabilities | 8,736 | 8,466 |
Total liabilities | 66,612 | 134,093 |
Commitments and Contingencies (See Note 10) | ' | ' |
Parent company investment | 282,896 | 308,444 |
Accumulated other comprehensive income | 927 | 926 |
Total parent company equity | 283,823 | 309,370 |
Total liabilities and parent company equity | 350,435 | 443,463 |
Pro Forma | ' | ' |
Assets | ' | ' |
Cash and cash equivalents | 48,866 | ' |
Restricted cash | 799 | ' |
Receivables: | ' | ' |
Accounts receivable, net of allowance for doubtful accounts of $1,728 and $773 as of 2014 and 2013, respectively | 29,341 | ' |
Other receivables, net of allowance for doubtful accounts of $723 and $1,080 as of 2014 and 2013, respectively | 5,559 | ' |
Total receivables | 34,900 | ' |
Deferred compensation | 9,344 | ' |
Investment in joint venture | 15,657 | ' |
Equipment and leasehold improvements, net | 5,347 | ' |
Deferred tax asset | 5,071 | ' |
Prepaid expenses and other assets | 19,707 | ' |
Total assets | 139,691 | ' |
Liabilities and Parent Company Equity | ' | ' |
Compensation payable | 35,092 | ' |
Accounts payable and accrued expenses | 14,649 | ' |
Deferred revenue | 8,135 | ' |
Other liabilities | 8,736 | ' |
Total liabilities | 66,612 | ' |
Commitments and Contingencies (See Note 10) | ' | ' |
Accumulated other comprehensive income | 927 | ' |
Additional paid-in-capital | 15,006 | ' |
Noncontrolling interests | 56,707 | ' |
Total parent company equity | 73,079 | ' |
Total liabilities and parent company equity | 139,691 | ' |
Pro Forma | Class A common stock | ' | ' |
Liabilities and Parent Company Equity | ' | ' |
Common stock, par value $0.01 per share | 77 | ' |
Pro Forma | Class B common stock | ' | ' |
Liabilities and Parent Company Equity | ' | ' |
Common stock, par value $0.01 per share | $362 | ' |
Condensed_Combined_Statements_1
Condensed Combined Statements of Financial Condition (Parenthetical) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, except Per Share data, unless otherwise specified | ||
Accounts receivable, allowance for doubtful accounts | $1,728 | $773 |
Other receivables, allowance for doubtful accounts | 723 | 1,080 |
Investments at fair value, cost basis | ' | $69,066 |
Class A common stock | ' | ' |
Common stock, par value (in dollars per share) | $0.01 | ' |
Class B common stock | ' | ' |
Common stock, par value (in dollars per share) | $0.01 | ' |
Condensed_Combined_Statements_2
Condensed Combined Statements of Operations (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Condensed Combined Statements of Operations | ' | ' |
Revenues | $114,517 | $59,845 |
Expenses | ' | ' |
Compensation and benefits | 70,441 | 43,582 |
Occupancy | 3,304 | 3,584 |
Professional fees | 3,335 | 3,007 |
Communication, technology and information services | 3,774 | 3,166 |
Travel and related expenses | 5,085 | 4,763 |
Depreciation and amortization | 575 | 584 |
Other expenses | 4,068 | 1,936 |
Total expenses | 90,582 | 60,622 |
Operating income (loss) | 23,935 | -777 |
Other income and expenses | 19 | 105 |
Income (loss) from equity method investment | -1,220 | 1,418 |
Income before income taxes | 22,734 | 746 |
Provision for income taxes | 642 | 35 |
Net income | $22,092 | $711 |
Pro_Forma_Combined_Statement_o
Pro Forma Combined Statement of Operations Information (USD $) | 3 Months Ended |
In Thousands, except Share data, unless otherwise specified | Mar. 31, 2014 |
Income before income taxes | $22,734 |
Pro forma provision for income taxes | -642 |
Pro forma net income attributable to common shareholders | 22,092 |
Pro forma | Class A common stock | ' |
Income before income taxes | 22,734 |
Pro forma provision for income taxes | -2,035 |
Pro forma net income | 20,699 |
Pro forma net income attributable to noncontrolling interests | 18,451 |
Pro forma net income attributable to common shareholders | $2,248 |
Net income per share of Class A common stock - basic and diluted (in dollars per share) | $0.29 |
Weighted average shares of Class A common stock outstanding - basic and diluted (in shares) | 7,699,851 |
Condensed_Combined_Statements_3
Condensed Combined Statements of Comprehensive Income (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Condensed Combined Statements of Comprehensive Income | ' | ' |
Net income | $22,092 | $711 |
Foreign currency translation adjustment, net of tax | 1 | -1,933 |
Other comprehensive income (loss) | 1 | -1,933 |
Comprehensive income (loss) | $22,093 | ($1,222) |
Condensed_Combined_Statements_4
Condensed Combined Statements of Cash Flows (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Cash flows from operating activities | ' | ' |
Net income | $22,092 | $711 |
Adjustments to reconcile combined net income to net cash provided by (used in) operating activities: | ' | ' |
Bad debt expense | 1,022 | 458 |
Depreciation and amortization | 575 | 584 |
Amortization of compensation associated with acquisition | ' | 205 |
(Income) loss from equity method investment | 1,220 | -1,418 |
Equity-based compensation | 11,010 | 12,526 |
Other | -540 | 361 |
Changes in assets and liabilities: | ' | ' |
Accounts receivable | -1,432 | 15,614 |
Other receivables | 241 | -6,699 |
Prepaid expenses and other assets | -6,009 | -757 |
Deferred compensation | -5,823 | -1,840 |
Compensation payable | -69,507 | -108,374 |
Accounts payable and accrued expenses | 364 | -743 |
Deferred revenue | 1,277 | 2,148 |
Dividends received | ' | 2,375 |
Other liabilities | 271 | 1,497 |
Net cash provided by (used in) operating activities | -45,239 | -83,352 |
Cash flows from investing activities | ' | ' |
Purchase of investments | -16,999 | -16,996 |
Proceeds from sales of investments | 83,237 | 118,143 |
Investment in joint venture | -4,180 | ' |
Note payments received from employees | 686 | 383 |
Purchase of equipment and leasehold improvements | -717 | -385 |
Change in restricted cash | -1 | -1 |
Net cash provided by (used in) investing activities | 62,026 | 101,144 |
Cash flows from financing activities | ' | ' |
Tax distributions to Parent for partners | -39,188 | -28,873 |
Other cash contributions from (distributions to) Parent | -17,240 | 1,143 |
Net cash provided by (used in) financing activities | -56,428 | -27,730 |
Effect of exchange rate fluctuations on cash and cash equivalents | -17 | -1,625 |
Net increase (decrease) in cash and cash equivalents | -39,658 | -11,563 |
Cash and cash equivalents, beginning of year | 303,024 | 185,623 |
Cash and cash equivalents, end of year | 263,366 | 174,060 |
Cash paid during the period for: | ' | ' |
Income taxes | 1,712 | 900 |
Investing activities | ' | ' |
Non-cash distribution to Parent | $2,904 | ' |
Condensed_Combined_Statements_5
Condensed Combined Statements of Changes in Parent Company Equity (USD $) | Total | Parent Company Investment | Accumulated Other Comprehensive Income (Loss) |
In Thousands, unless otherwise specified | |||
Balance at beginning of the period at Dec. 31, 2012 | $260,108 | $259,945 | $163 |
Changes in Parent Company Equity (Deficit) | ' | ' | ' |
Net income | 711 | 711 | ' |
Other comprehensive income (loss) | -1,933 | ' | -1,933 |
Net cash distributions to Parent | -27,730 | -27,730 | ' |
Equity-based compensation | 12,526 | 12,526 | ' |
Equity-based contributions to joint venture and Parent's advisory board | 523 | 523 | ' |
Balance at end of the period at Mar. 31, 2013 | 244,205 | 245,975 | -1,770 |
Balance at beginning of the period at Dec. 31, 2013 | 309,370 | 308,444 | 926 |
Changes in Parent Company Equity (Deficit) | ' | ' | ' |
Net income | 22,092 | 22,092 | ' |
Other comprehensive income (loss) | 1 | ' | 1 |
Net cash distributions to Parent | -56,428 | -56,428 | ' |
Equity-based compensation | 11,010 | 11,010 | ' |
Equity-based contributions to joint venture and Parent's advisory board | 682 | 682 | ' |
Other non-cash distributions | -2,904 | -2,904 | ' |
Balance at end of the period at Mar. 31, 2014 | $283,823 | $282,896 | $927 |
ORGANIZATION_AND_BASIS_OF_PRES
ORGANIZATION AND BASIS OF PRESENTATION | 3 Months Ended |
Mar. 31, 2014 | |
ORGANIZATION AND BASIS OF PRESENTATION | ' |
ORGANIZATION AND BASIS OF PRESENTATION | ' |
1. ORGANIZATION AND BASIS OF PRESENTATION | |
The accompanying condensed combined financial statements include the historical carved out accounts and operations of the Advisory business (the "Company," "we," "our," or "us") of Moelis & Company Holdings LP (the "Parent" or "Old Holdings"). The Parent is a Delaware limited partnership that commenced operations originally as a limited liability company on May 1, 2007 and was converted to a limited partnership on July 1, 2011. The general partner of the Parent is Moelis & Company Holdings GP LLC. The sole member of Moelis & Company Holdings GP LLC is Moelis & Company Manager LLC ("Manager"), which is wholly-owned by certain co-founding partners. The Company's activities as an investment banking advisory firm constitute a single business segment offering clients, including corporations, governments and financial sponsors, a range of advisory services with expertise across all major industries in mergers and acquisitions, recapitalizations and restructurings and other corporate finance matters. | |
In April of 2014, Old Holdings reorganized its business in connection with an initial public offering ("IPO") of 7,475,000 shares of Moelis & Company Class A common stock. The details of the reorganization and IPO are described further in Note 4 and in the combined financial statements of the Advisory Operations of Moelis & Company Holdings LP in Moelis & Company's Registration Statement filed with the U.S. Securities and Exchange Commission ("SEC") effective April 15, 2014 ("the Registration Statement"). The interim financial information provided in the accompanying condensed combined financial statements represents the results of operations and financial condition of the Company prior to the reorganization. | |
Basis of Presentation—The condensed combined financial statements of the Company include only those accounts attributable to the Advisory business which include certain accounts and allocations from the Parent and the following subsidiaries: | |
• | |
Moelis & Company LLC ("Moelis"), a Delaware limited liability company, a registered broker-dealer with the SEC and a member of the Financial Industry Regulatory Authority ("FINRA"). | |
• | |
Moelis & Company International Holdings LLC ("Moelis International"), a Delaware limited liability company, owns the following entities: | |
• | |
Moelis & Company UK LLP ("Moelis UK"), a limited liability partnership registered under the laws of England and Wales. In addition to the United Kingdom, Moelis UK maintains operations through the following subsidiaries and branches: | |
• | |
Moelis & Company France SAS (French subsidiary) | |
• | |
Moelis & Company Europe Limited, Frankfurt am Main (German branch) | |
• | |
Moelis & Company UK LLP, DIFC (Dubai branch) | |
• | |
50% of Moelis Australia Holdings PTY Limited ("Moelis Australia Holdings", or the "Australian JV"), a joint venture with Magic Trust Trustee PTY Limited (the "Trust"). | |
• | |
Moelis & Company Asia Limited ("Moelis Asia"), a limited company incorporated in Hong Kong licensed under the Hong Kong Securities and Futures Ordinance to provide financial advisory services. In addition to Hong Kong, Moelis Asia maintains operations in Beijing China through Moelis & Company Consulting (Beijing) Company Limited. | |
• | |
Moelis & Company India Private Limited, a private limited company incorporated in Mumbai, India. | |
SUMMARY_OF_SIGNIFICANT_ACCOUNT
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Mar. 31, 2014 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' |
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Basis of Accounting—The Company prepared the accompanying condensed combined financial statements in conformity with accounting principles generally accepted in the United States of America ("U.S. GAAP"). As permitted by the interim reporting rules and regulations set forth by the SEC, the condensed combined financial statements presented exclude certain financial information and footnote disclosures normally included in audited financial statements prepared in accordance with U.S. GAAP. In the opinion of the Company's management, the accompanying unaudited condensed combined financial statements contain all adjustments, including normal recurring accruals, necessary to fairly present the accompanying unaudited condensed combined financial statements. These unaudited condensed combined financial statements should be read in conjunction with the combined audited financial statements for the year ended December 31, 2013 included in the Company's Registration Statement. | |
Use of Estimates—The preparation of condensed combined financial statements and related disclosures in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Estimates and assumptions are reviewed periodically, and the effects of revisions are reflected in the period in which they are determined to be necessary. | |
In preparing the condensed combined financial statements, management makes estimates and assumptions regarding: | |
• | |
the adequacy of the allowance for doubtful accounts; | |
• | |
the realization of deferred taxes; | |
• | |
the measurement of equity-based compensation; and | |
• | |
other matters that affect the reported amounts and disclosures of contingencies in the financial statements. | |
Expense Allocations—In addition to the revenues, expenses, assets and liabilities that are specifically identifiable to the Company, certain expenses have been allocated from the Parent based on the most relevant measure, including relative usage or proportion of the Company's headcount to that of the Parent. For the three months ended March 31, 2014 and 2013, $2,316 and $2,461, respectively, of occupancy expenses have been allocated to the Company based on the proportion of the Company's headcount to that of the Parent. For the three months ended March 31, 2014 and 2013, $2,745 and $2,303 respectively, of communication, technology and information services expenses have been allocated to the Company based on a combination of relative usage and the proportion of the Company's headcount to that of the Parent. All other expenses were specifically identifiable to the Company. Management believes the assumptions and allocations underlying the condensed combined financial statements are reasonable, and the allocated amounts are representative of the amounts that would have been recorded in the condensed combined financial statements had the Company operated independent of the Parent for the historical periods presented. | |
All intercompany balances and transactions within the Company have been eliminated. | |
Cash and Cash Equivalents—Cash and cash equivalents include all short-term highly liquid investments that are readily convertible to known amounts of cash and have original maturities of three months or less from the date of purchase. | |
As of March 31, 2014, the Company had cash equivalents of $236,970 (December 31, 2013: $260,825) invested primarily in U.S. Treasury Bills and government securities money market funds. Additionally, as of March 31, 2014, the Company had cash of $26,396 (December 31, 2013: $42,199) maintained in U.S. and non-U.S. bank accounts, of which some account balances exceeded the FDIC coverage limit of $250. | |
Restricted Cash—The Company held cash of $799 and $792 as of March 31, 2014 and December 31, 2013, respectively, in restricted collateral accounts deposited in connection with corporate credit card programs. | |
Receivables—The accompanying condensed combined statements of financial condition presents accounts receivable balances net of allowance for doubtful accounts based on the Company's assessment of the collectability of customer accounts. | |
The Company maintains an allowance for doubtful accounts that, in management's opinion, provides for an adequate reserve to cover losses that may be incurred. The Company regularly reviews the allowance by considering factors such as historical experience, credit quality, age of the accounts receivable and recoverable expense balances, and the current economic conditions that may affect a customer's ability to pay such amounts owed to the Company. | |
After concluding that a reserved accounts receivable is no longer collectible, the Company will charge-off the receivable. This is determined based on several factors including the age of the accounts receivable and the credit worthiness of the customer. This has the effect of reducing both the gross receivable and the allowance for doubtful accounts. | |
Deferred Compensation—Deferred compensation costs represent arrangements with certain employees whereby cash payments are subject to a required period of service subsequent to payment by the Company. These amounts are charged to expenses over the period that the employee is required to provide services in order to vest in the payment. | |
Financial Instruments at Fair Value—Fair value is generally based on quoted prices, however if quoted market prices are not available, fair value is determined based on other relevant factors, including dealer price quotations, price activity for equivalent instruments and valuation pricing models. The Company established a fair value hierarchy 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 instrument, the characteristics specific to the instrument and the state of the marketplace (including the existence and transparency of transactions between market participants). Financial instruments with readily-available actively quoted prices or for which fair value can be measured from actively-quoted prices in an orderly market will generally have a higher degree of market price observability and a lesser degree of judgment used in measuring fair value. | |
Financial instruments measured and reported at fair value are classified and disclosed in one of the following categories (from highest to lowest) based on inputs: | |
Level 1—Quoted prices (unadjusted) are available in active markets for identical instruments that the Company has the ability to access as of the reporting date. The Company, to the extent that it holds such instruments, does not adjust the quoted price for these instruments, even in situations in which the Company holds a large position and a sale could reasonably affect the quoted price. | |
Level 2—Pricing inputs are observable for the instruments, either directly or indirectly, as of the reporting date, but are not the same as those used in Level 1. Fair value is determined through the use of models or other valuation methodologies. | |
Level 3—Pricing inputs are unobservable for the instruments and include situations where there is little, if any, market activity for the investments. The inputs into the determination of fair value require significant judgment or estimation by the Company's management. | |
In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the determination of which category within the fair value hierarchy is appropriate for any given investment is based on the lowest level of input that is significant to the fair value measurement. The Company's assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the instrument. | |
For level 3 investments in which pricing inputs are unobservable and limited market activity exists, management's determination of fair value is based on the best information available, may incorporate management's own assumptions and involves a significant degree of judgment. | |
Investment in Joint Venture—The Company accounts for its investment in Moelis Australia Holdings under the equity method of accounting as the Company does not control the entity but jointly controls Moelis Australia Holdings with the Trust. The Company reflects its investment in investment in joint venture on the accompanying condensed combined statements of financial condition. In connection with this investment, the Company acquired a call option to purchase the remaining 50% interest in Moelis Australia Holdings. Also, in connection with the investment, the Company granted a put option enabling the key senior Australian executive to sell his remaining shares in Moelis Australia Holdings back to the Company upon certain defined exit events. The call and the put options are embedded in the equity method investment and have not been separated as embedded derivatives because they do not meet the definition of a derivative given that the investee's shares are not publicly traded. The investment reflects the Company's share of contributions made to, distributions received from, and the equity earnings and losses of, the joint venture. The Company reflects its share of gains and losses of the joint venture in income (loss) from equity method investment in the condensed combined statements of operations. | |
Equipment and Leasehold Improvements—Equipment consists primarily of office equipment, computer equipment and furniture and fixtures and is stated at cost less accumulated depreciation, which is determined using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are stated at cost less accumulated amortization, which is determined using the straight-line method over the lesser of the term of the lease or the estimated useful lives of the assets. | |
Major renewals and improvements are capitalized and minor replacements, maintenance and repairs are charged to expenses as incurred. Upon retirement or disposal of assets, the cost and related accumulated depreciation or amortization are removed from the condensed combined statements of financial condition and any gain or loss is reflected in the condensed combined statements of operations. | |
Revenue and Expense Recognition—The Company recognizes revenues from providing advisory services when earned. Upfront fees are recognized over the estimated period that the related services are performed. Transaction-related fees are recognized when all services for a transaction have been provided, specified conditions have been met and the transaction closes. Underwriting revenues are recognized when the offering is deemed complete and is presented net of related expenses. Deferred revenues are recorded for fees received that have not yet been earned. Expenses are recorded on the condensed combined statements of operations, net of client reimbursements. Reimbursable expenses billed to clients totaled $2,510 and $1,591 for the three months ended March 31, 2014 and 2013 respectively. | |
Equity-based Compensation—The Company recognizes the cost of partner and non-partner employee services received in exchange for an equity instrument award. The cost is based on its grant-date fair value amortized over the service period required by the award's vesting terms. The measurement of the grant-date fair value requires the Company's Parent to make estimates about its future operating results and the appropriate risk-adjusted discount rates. The methods used to estimate the fair value of equity-based compensation generally include the market approach and the income approach, each of which involve a significant degree of judgment. Under the market approach, fair value is determined with reference to observable valuation measures for comparable companies (e.g., multiplying a key performance metric of the comparable company by a relevant valuation multiple—adjusted for differences between the Company's Parent and the referenced comparable). Under the income approach, fair value is determined by converting future amounts (e.g., cash flows or earnings) to a single present amount (discounted) using current expectations about those future amounts. These estimates could change in the future and have a material impact on the estimate of the fair value. The Company recognizes such amounts in compensation and benefits expenses on the accompanying condensed combined statements of operations and as an increase to parent company equity on the accompanying condensed combined statements of financial condition and in the accompanying condensed combined statements of changes in parent company equity. See Note 7 for further discussion. | |
Income Taxes—The Company's operating results were included in the Parent's U.S. federal and state income tax returns, as well as the tax filings for non-U.S. jurisdictions. For purposes of the Company's condensed combined financial statements, provision for income taxes and deferred tax balances have been calculated as if the Company completed its tax returns on a stand-alone basis separate from the Parent ("Separate Return Method"). The Separate Return Method applies the accounting guidance for income taxes to the condensed combined financial statements as if the Company were a separate taxpayer and a stand-alone enterprise from its Parent for the periods presented. | |
The Company is comprised of entities that are organized as limited liability companies and limited partnerships. For federal income tax purposes, the Company is a pass-through entity. Accordingly, no federal income taxes are assessed at the Company level. Federal income tax law and regulations require the partners to report their allocable share of the Company's taxable income or loss in their respective tax returns. Certain foreign, state and local tax authorities levy taxes on the Company based on its income. | |
The Company will continue to review the conclusions reached regarding uncertain tax positions, which may be subject to review and adjustment at a later date based on ongoing analyses of tax laws, regulations and interpretations thereof. To the extent that the Company's assessment of the conclusions reached regarding uncertain tax positions changes, such change in estimate will be recorded in the period in which such determination is made. The Company reports income tax-related interest and penalties, if applicable, as a component of income tax expense. For the three months ended March 31, 2014 and 2013, no such amounts were recognized. | |
Foreign Currency Translation—Assets and liabilities held in non-U.S. dollar denominated (functional) currencies are translated into U.S. dollars at exchange rates in effect at the end of the reporting period. Revenues and expenses are translated at average exchange rates during the reporting period. A charge or credit is recorded to other comprehensive income to reflect the translation of these amounts to the extent the non-U.S. currency is designated the functional currency of the subsidiary. Non-functional currency related transaction gains and losses are immediately recorded in the condensed combined statements of operations. | |
RECENT_ACCOUNTING_PRONOUNCEMEN
RECENT ACCOUNTING PRONOUNCEMENTS | 3 Months Ended |
Mar. 31, 2014 | |
RECENT ACCOUNTING PRONOUNCEMENTS | ' |
RECENT ACCOUNTING PRONOUNCEMENTS | ' |
3. RECENT ACCOUNTING PRONOUNCEMENTS | |
In January 2013, the FASB issued ASU No. 2013-01 "Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities" ("ASU 2013-01"). ASU 2013-01 provides amendments to ASU 2011-11 by clarifying the scope of transactions that are subject to the disclosures of offsetting. The amendments in this update are effective retrospectively for periods beginning after January 1, 2013. The adoption of this update did not have an impact on the Company's condensed combined financial statements. | |
In July 2013, the FASB issued ASU No. 2013-11, "Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists" ("ASU 2013-11"). ASU 2013- 11 provides amendments to ASC No. 740, "Income Taxes", which clarify the guidance for the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss or a tax credit carryforward exists. The amendments require that an unrecognized tax benefit, or a portion of an unrecognized tax benefit, be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss or a tax credit carryforward. If a net operating loss carryforward, a similar tax loss or a tax credit carryforward is not available at the reporting date under the tax law of the applicable jurisdiction to settle any additional income taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. The amendments in this update are effective prospectively during interim and annual periods beginning after December 15, 2013, with early adoption permitted. The adoption of this update did not have a material impact on the Company's condensed combined financial statements. | |
BUSINESS_CHANGES_AND_DEVELOPME
BUSINESS CHANGES AND DEVELOPMENTS | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
BUSINESS CHANGES AND DEVELOPMENTS | ' | |||||||
BUSINESS CHANGES AND DEVELOPMENTS | ' | |||||||
4. BUSINESS CHANGES AND DEVELOPMENTS | ||||||||
Reorganization and Initial Public Offering | ||||||||
Subsequent to March 31, 2014, Old Holdings reorganized its business in connection with the IPO of Class A common stock by Moelis & Company, a newly-formed Delaware corporation. Following the reorganization, the Advisory operations are owned by Moelis & Company Group LP, a Delaware limited partnership ("Group LP"). Group LP is controlled by Moelis & Company. The new public shareholders are entitled to receive a portion of the economics of the Advisory operations through their direct ownership interests in shares of Class A common stock of Moelis & Company. The existing owners of the Parent will continue to receive the majority of the economics of the Advisory operations, as non-controlling interest holders, primarily through direct and indirect ownership interests in Group LP partnership units. As a corporation, Moelis & Company will be subject to United States federal and state corporate income taxes, which will result in a material increase in the applicable tax rates and current tax expense incurred post reorganization. | ||||||||
Group LP has one principal class of units, Class A partnership units. Group LP issued Class A partnership units to Moelis & Company and to certain existing holders of Old Holdings units who are Class A partnership unitholders. Following the reorganization, a Group LP Class A partnership unit (not held by Moelis & Company or its subsidiaries) is exchangeable into one share of Moelis & Company Class A common stock. In addition, Group LP issued Class B partnership units to Moelis & Company. The Class B partnership units correspond with the economic rights of shares of Moelis & Company Class B common stock. The economic rights of Class B common stock are based on the ratio of the Class B subscription price to the initial public offering price of shares of Class A common stock (.00055 to 1), and the aggregate number of shares of Class B common stock may be converted to Class A common stock (up to a maximum of 20,000 shares). Holders of shares of Class B common stock are entitled to receive dividends of the same type as any dividends payable on outstanding shares of Class A common stock at a ratio of .00055 to 1. | ||||||||
Group LP Class A partnership unitholders have no voting rights by virtue of their ownership of Group LP Class A partnership units, except for the limited rights described in Group LP's Amended and Restated Agreement of Limited Partnership. Moelis & Company Partner Holdings LP holds all shares of Class B common stock, enabling it initially to exercise majority voting control over Moelis & Company and, indirectly, over Group LP. Among other items, the Class B Condition calls for Mr. Moelis to maintain a defined minimum equity stake and that he devote his primary business time to Moelis & Company. So long as the Class B Condition is satisfied, each share of Class B common stock entitles its holder to ten votes for each share held of record on all matters submitted to a vote of stockholders. Shares of Class B common stock are generally not transferrable and, if transferred other than in the limited circumstances set forth in Moelis & Company's Amended and Restated Certificate of Incorporation, such shares shall automatically convert into a number of shares of Class A common stock set forth in Moelis & Company's Amended and Restated Certificate of Incorporation. Upon failure of the Class B Condition, each share of Class B common stock will have one vote for each share held. Each share of Class B common stock may, at the option of the holder, be converted into a number of shares of Class A common stock set forth in Moelis & Company's Amended and Restated Certificate of Incorporation. | ||||||||
Unaudited Pro Forma Combined Statement of Financial Condition | ||||||||
In connection with the Company's reorganization, 1,101,541 pre-reorganization partnership units of Old Holdings became 46,722,753 post-reorganization Class A Group LP partnership units. 39,022,902 of these partnership units are held by the partners of Old Holdings and represent a noncontrolling interest in Group LP, and the remaining 7,699,851 units were converted into Class A common stock of the Company, representing a controlling interest. In addition, the Company distributed approximately $215,000 to its existing owners and to a separate business of the Parent. The unaudited pro forma combined statement of financial condition as of March 31, 2014 gives pro forma effect to this distribution payable in cash as if the distribution had been effected as of March 31, 2014. The unaudited pro forma combined statement of financial condition is presented for illustrative purposes only and does not purport to project the Company's combined financial condition for any future date. | ||||||||
Unaudited Pro Forma Combined Statement of Operations Information | ||||||||
The following calculation reflects net income attributable to common shareholders divided by weighted average shares of Class A common stock outstanding. | ||||||||
Pro forma net income attributable to Class A common shareholders | $ | 2,248 | ||||||
| | | | | ||||
| | | | | ||||
Weighted average shares of Class A common stock outstanding—basic and diluted | 7,699,851 | |||||||
| | | | | ||||
| | | | | ||||
Net income available to holders of Class A common stock per share | $ | 0.29 | ||||||
| | | | | ||||
| | | | | ||||
Pro forma net income attributable to Class A common shareholders | ||||||||
Income before income taxes | $ | 22,734 | ||||||
Pro forma provision for income taxes | -2,035 | (a) | ||||||
| | | | | ||||
Pro forma net income | 20,699 | |||||||
Pro forma net income attributable to noncontrolling interests | 18,451 | (b) | ||||||
| | | | | ||||
Pro forma net income attributable to Class A common shareholders | $ | 2,248 | ||||||
| | | | | ||||
| | | | | ||||
(a) | ||||||||
In connection with the reorganization, 16.48% of the outstanding partnership interests was converted directly into 7,699,851 shares of Class A common stock of Moelis & Company. An adjustment has been made to increase the effective tax rate, applied to these earnings, to 40%, which assumes the Company is taxed as a corporation. | ||||||||
(b) | ||||||||
Reflects an adjustment to record the 83.52% noncontrolling interests, net of tax, that partners of Old Holdings (other than the Company) own in Group LP relating to their partnership units. As part of the reorganization, 7,699,851 shares of Class A common stock are outstanding in Moelis & Company and 39,022,902 partnership units are held by partners of Old Holdings. | ||||||||
Basic and diluted weighted average Class A common stock outstanding | ||||||||
Basic and | ||||||||
Diluted | ||||||||
Class A common stock outstanding upon completion of the reorganization | 7,699,851 | |||||||
Class A partnership units(1) | — | |||||||
| | | | | ||||
Weighted average shares of Class A common stock outstanding upon completion of the reorganization | 7,699,851 | |||||||
| | | | | ||||
| | | | | ||||
-1 | ||||||||
Class A partnership units may be exchanged for our Class A common stock on a one-for-one basis, subject to customary conversion rate adjustments for splits, unit distributions and reclassifications and compliance with applicable lock-up, vesting and transfer restrictions. If all Class A partnership units were to be exchanged for Class A common stock immediately following the reorganization, fully diluted Class A common stock outstanding would be 46,722,753. In computing the dilutive effect, if any, that the aforementioned exchange would have on earnings per share, we consider that net income available to holders of Class A common stock would increase due to elimination of the noncontrolling interest in consolidated entities associated with the Group LP Class A partnership units (including any tax impact). For the quarter ended March 31, 2014, such exchange is not reflected in diluted earnings per share as the assumed exchange is not dilutive. | ||||||||
We have not included the impact of shares of Class B common stock because these shares are entitled to an insignificant amount of economic participation. | ||||||||
Investment in Joint Venture | ||||||||
On April 1, 2010, the Company entered into a 50-50 joint venture in Moelis Australia Holdings, investing a combination of cash and certain net assets of its wholly-owned subsidiary, Moelis Australia, in exchange for its interests. The remaining 50% is owned by an Australian trust established by and for the benefit of Moelis Australia senior executives. | ||||||||
On April 1, 2011, the Parent contributed its equity to Moelis Australia Holdings, which in turn granted equity awards to its employees in return for providing future employment related services. These units generally vest over an eight year service period and are recorded as compensation expenses on Moelis Australia Holdings' financial statements. As the recipients are not employees of the Company, but rather employees of the Australian JV, the Company recognizes the entire expense associated with these awards based on the fair value re-measured at each reporting period and amortized over the vesting period. For the three months ended March 31, 2014, the Company recognized $432 in additional parent company equity, $216 in investment in joint venture and $216 in other expenses relating to the contribution of these equity awards in the condensed combined financial statements. For the three months ended March 31, 2013, the Company recognized $470 in additional parent company equity, $235 in investment in joint venture and $235 in other expenses relating to the contribution of these equity awards in the condensed combined financial statements. | ||||||||
During the three months ended March 31, 2013, Moelis Australia Holdings paid dividends to the Company in the amount of $2,375. This dividend was treated as a return on investment in joint venture in the condensed combined financial statements. | ||||||||
During the three months ended March 31, 2014, the Company made a cash contribution to Moelis Australia Holdings in the amount of $4,180. The Company treated this contribution as an increase in investment in joint venture in the condensed combined financial statements. | ||||||||
Summary financial information related to Moelis Australia Holdings is as follows: | ||||||||
March 31, | December 31, | |||||||
2014 | 2013 | |||||||
Total assets | $ | 29,732 | $ | 38,465 | ||||
Total liabilities | (4,225 | ) | (15,760 | ) | ||||
| | | | | | | | |
Net equity | $ | 25,507 | $ | 22,705 | ||||
| | | | | | | | |
| | | | | | | | |
For the Three Months | ||||||||
Ended March 31, | ||||||||
2014 | 2013 | |||||||
Total revenues | $ | 3,133 | $ | 13,118 | ||||
Total expenses | (5,573 | ) | (10,282 | ) | ||||
| | | | | | | | |
Net income (loss) | $ | (2,440 | ) | $ | 2,836 | |||
| | | | | | | | |
| | | | | | | | |
Ownership percentage | 50 | % | 50 | % | ||||
Income (loss) from investment in joint venture | $ | (1,220 | ) | $ | 1,418 |
EQUIPMENT_AND_LEASEHOLD_IMPROV
EQUIPMENT AND LEASEHOLD IMPROVEMENTS | 3 Months Ended | |||||||||
Mar. 31, 2014 | ||||||||||
EQUIPMENT AND LEASEHOLD IMPROVEMENTS | ' | |||||||||
EQUIPMENT AND LEASEHOLD IMPROVEMENTS | ' | |||||||||
5. EQUIPMENT AND LEASEHOLD IMPROVEMENTS | ||||||||||
Equipment and leasehold improvements, net consist of the following: | ||||||||||
Useful lives | March 31, | December 31, | ||||||||
2014 | 2013 | |||||||||
Office equipment | 3 Years | $ | 7,791 | $ | 7,498 | |||||
Furniture and fixtures | 7 Years | 2,156 | 1,730 | |||||||
Leasehold improvements | 5 - 60 Months | 4,400 | 4,395 | |||||||
| | | | | | | | | | |
Total | 14,347 | 13,623 | ||||||||
Less accumulated depreciation and amortization | (9,000 | ) | (8,467 | ) | ||||||
| | | | | | | | | | |
Equipment and leasehold improvements, net | $ | 5,347 | $ | 5,156 | ||||||
| | | | | | | | | | |
| | | | | | | | | | |
Depreciation and amortization expenses for fixed assets totaled $533 and $542 for the three months ended March 31, 2014 and 2013, respectively. | ||||||||||
FAIR_VALUE_MEASUREMENTS
FAIR VALUE MEASUREMENTS | 3 Months Ended | |||||||||||||
Mar. 31, 2014 | ||||||||||||||
FAIR VALUE MEASUREMENTS | ' | |||||||||||||
FAIR VALUE MEASUREMENTS | ' | |||||||||||||
6. FAIR VALUE MEASUREMENTS | ||||||||||||||
The Company established a fair value hierarchy which prioritizes and ranks the level of market price observability used in measuring investments at fair value. Financial instruments measured and reported at fair value are classified and disclosed in one of the following categories (from highest to lowest) based on inputs: | ||||||||||||||
Level 1—Quoted prices (unadjusted) are available in active markets for identical instruments that the Company has the ability to access as of the reporting date. The Company, to the extent that it holds such instruments, does not adjust the quoted price for these instruments, even in situations in which the Company holds a large position and a sale could reasonably affect the quoted price. | ||||||||||||||
Level 2—Pricing inputs are observable for the instruments, either directly or indirectly, as of the reporting date, but are not the same as those used in Level 1. Fair value is determined through the use of models or other valuation methodologies. The estimated fair values of government securities money markets, U.S. Treasury Bills and bank time deposits classified in Level 2 as of March 31, 2014 and 2013 are based on quoted prices for recent trading activity in identical or similar instruments. The Company generally invests in U.S. Treasury Bills with maturities of less than six months. | ||||||||||||||
Level 3—Pricing inputs are unobservable for the instruments and include situations in which there is little, if any, market activity for the investments. The inputs into the determination of fair value require significant judgment or estimation by the Company's management. The valuation methodology used for the Company's investment classified as Level 3 as of December 31, 2013 was based upon a recent market transaction executed by the issuer. | ||||||||||||||
See Note 2 for further information on the Company's fair value hierarchy. | ||||||||||||||
The following tables summarize the levels of the fair value hierarchy into which the Company's financial assets and liabilities fall as of March 31, 2014: | ||||||||||||||
Financial assets: | Total | Level 1 | Level 2 | Level 3 | ||||||||||
Included in cash and cash equivalents | ||||||||||||||
Government securities money market | $ | 77,006 | $ | — | $ | 77,006 | $ | — | ||||||
U.S. treasury bills | 119,480 | — | 119,480 | $ | — | |||||||||
Bank time deposits | 40,484 | — | 40,484 | — | ||||||||||
| | | | | | | | | | | | | | |
Total financial assets | $ | 236,970 | $ | — | $ | 236,970 | $ | — | ||||||
| | | | | | | | | | | | | | |
| | | | | | | | | | | | | | |
The following table summarizes the levels of the fair value hierarchy into which the Company's financial assets fall as of December 31, 2013: | ||||||||||||||
Financial assets: | Total | Level 1 | Level 2 | Level 3 | ||||||||||
Included in cash and cash equivalents | ||||||||||||||
Government securities money market | $ | 73,366 | $ | — | $ | 73,366 | $ | — | ||||||
U.S. treasury bills | 146,991 | — | 146,991 | — | ||||||||||
Bank time deposits | 40,468 | — | 40,468 | — | ||||||||||
Investments: | ||||||||||||||
U.S. Treasury Bills | 66,237 | — | 66,237 | — | ||||||||||
Common stock | 1,904 | — | — | 1,904 | ||||||||||
| | | | | | | | | | | | | | |
Total investments in securities | 68,141 | — | 66,237 | 1,904 | ||||||||||
| | | | | | | | | | | | | | |
Total financial assets | $ | 328,966 | $ | — | $ | 327,062 | $ | 1,904 | ||||||
| | | | | | | | | | | | | | |
| | | | | | | | | | | | | | |
The Company's methodology for reclassifications impacting the fair value hierarchy is that transfers in/out of the respective category are reported at fair value as of the beginning of the period in which the reclassification occurred. The changes to the Company's investment classified as Level 3 are as follows for the three months ended March 31, 2014. | ||||||||||||||
Common Stock | ||||||||||||||
January 1, 2014 | $ | 1,904 | ||||||||||||
Non-cash settlement of customer receivable | 1,000 | |||||||||||||
Distribution to Parent | (2,904 | ) | ||||||||||||
| | | | | ||||||||||
March 31, 2014 | $ | — | ||||||||||||
| | | | | ||||||||||
| | | | | ||||||||||
Unrealized gains (losses) related to investment still held as of March 31, 2014 | $ | — | ||||||||||||
| | | | | ||||||||||
| | | | | ||||||||||
There were no transfers between Level 1, Level 2 or Level 3 during the three months ended March 31, 2014 and 2013. | ||||||||||||||
Investment Risk Factors and Concentration of Investments | ||||||||||||||
The Company's financial instruments are subject to the following risk factors: | ||||||||||||||
Market Risk | ||||||||||||||
Market risk represents the loss that can be caused by a change in the fair value of a financial instrument. | ||||||||||||||
Currency Risk | ||||||||||||||
The Company is exposed to the risk that the exchange rate of the U.S. dollar relative to other currencies may have an adverse effect on the reported value of the Company's non-U.S. dollar denominated or based assets and liabilities. | ||||||||||||||
EquityBased_Compensation
Equity-Based Compensation | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Equity-Based Compensation | ' | |||||||
Equity-Based Compensation | ' | |||||||
7. Equity-Based Compensation | ||||||||
The Parent's ownership structure is comprised of common partners holding units ("Common Units") and employees holding units ("Management Units"), which collectively represent the partnership interests in the Parent and evidence the right to receive distributions and allocations of net profit and losses (and items thereof) as defined in the Parent Limited Partnership Agreement, as amended and restated from time to time. Substantially all of these units participate equally in distributions and allocations of profit and losses. There is no expressed limit to the number of units which may be issued by the Parent. Each new unit issued has the effect of diluting each incumbent equity holder's interest. As of March 31, 2014, the total number of Parent units outstanding was 1,099,502, of which 880,794 related to Management Units provided to partner and non-partner employees of the Company, as described further below. | ||||||||
The common partners contributed capital to the Parent and are not subject to vesting. Upon joining the Parent, certain partners were granted Management Units. Management Units provided upon joining the Company generally vest based on service over eight years beginning on the grant date as follows: | ||||||||
Years 1 through 4 | 0 | % | ||||||
End of year 5 | 50 | % | ||||||
End of year 6 | 662/3 | % | ||||||
End of year 7 | 831/3 | % | ||||||
End of year 8 | 100 | % | ||||||
In addition, Management Units are granted as part of certain partner's incentive arrangements. Management Units granted as part of a partner's incentive arrangements generally vest based on service over five years as follows: | ||||||||
Years 1 and 2 | 0 | % | ||||||
End of year 3 | 331/3 | % | ||||||
End of year 4 | 662/3 | % | ||||||
End of year 5 | 100 | % | ||||||
Certain non-partner employees are granted Management Units as part of their incentive arrangements. These units generally vest based on service ratably over four years. | ||||||||
Management Units granted to partners and non-partner employees identified as working for the Company are treated as a form of equity-based compensation and reported on the condensed combined statements of operations in compensation and benefits and on the condensed combined statements of financial condition in parent company equity. Compensation expenses on unvested units are calculated based on the grant date fair value of a Management Unit amortized over the vesting period. | ||||||||
The measurement of the grant-date fair value requires the Company's Parent to make estimates about its future operating results and the appropriate risk-adjusted discount rates. The methods used to estimate the fair value of equity-based compensation include the market approach and the income approach, each of which involve a significant degree of judgment. Under the market approach, fair value is determined by multiplying net income and revenues of comparable public companies by the relevant valuation multiple—adjusted for differences between the Company's Parent and the referenced comparable. Under the income approach, fair value is determined by converting future cash flows to a single present amount (discounted) using current expectations about those future amounts. The significant assumptions used to develop the fair value estimates include the discount rate used under the income approach and the net income and revenue multiples used under the market approach. | ||||||||
Additionally, the calculation of compensation expenses on unvested Management Units assumes a forfeiture rate of 3% annually for partners and 5% annually for non-partner employees based upon expected turnover. For the three months ended March 31, 2014 and 2013, the Company recognized compensation expenses of $11,010 and $12,526, respectively in relation to equity-based awards. As of March 31, 2014, there was $98,305 of unrecognized compensation expense related to unvested awards, approximately $87,600 of this unrecognized compensation expense has been accelerated following the Company's IPO in April. The Company expects to recognize the remaining $10,705 of unrecognized compensation expense over a weighted-average period of 3.5 years, using the graded vesting method, which treats each vesting portion as a separate award. | ||||||||
The activity related to the Management Units provided to partner and non-partner employees for the three months ended March 31, 2014 and 2013 is set forth below: | ||||||||
Units | Weighted average | |||||||
fair value | ||||||||
at grant date | ||||||||
Outstanding at January 1, 2014 | 882,080 | $ | 270.05 | |||||
Granted | 1,609 | 1,224.00 | ||||||
Forfeited | (2,895 | ) | 836.19 | |||||
| | | | | | | | |
Outstanding at March 31, 2014 | 880,794 | $ | 269.94 | |||||
| | | | | | | | |
| | | | | | | | |
Outstanding at January 1, 2013 | 855,003 | 242.55 | ||||||
Granted | 2,495 | 791.16 | ||||||
Forfeited | (1,272 | ) | 101.75 | |||||
| | | | | | | | |
Outstanding at March 31, 2013 | 856,226 | $ | 244.72 | |||||
| | | | | | | | |
| | | | | | | | |
The activity related to the unvested Management Units provided to partner and non-partner employees for the three months ended March 31, 2014 is set forth below: | ||||||||
Shares | Weighted Average | |||||||
Grant Date | ||||||||
Fair Value | ||||||||
Unvested Balance at January 1, 2014 | 452,957 | $ | 485.44 | |||||
Granted | 1,609 | 1,224.00 | ||||||
Forfeited | (2,894 | ) | 836.19 | |||||
Vested | (6,352 | ) | 501.22 | |||||
| | | | | | | | |
Unvested Balance at March 31, 2014 | 445,320 | $ | 485.61 | |||||
| | | | | | | | |
| | | | | | | | |
The Company has provided employees with the opportunity to participate in the increased value of the Parent's equity, contingent upon a sale of the Parent or other defined liquidity event ("Rights"). Rights have been provided to enhance the Company's ability to attract and retain certain employees. Employees forfeit their Rights upon termination of employment for any reason. Rights outstanding totaled 11,832 and 11,634 as of March 31, 2014 and December 31, 2013, respectively. As of March 31, 2014, the Company determined that it was not probable that the contingency would occur. Subsequent to March 31, 2014, the Company completed its IPO and the Rights were settled by issuing 88,802 fully vested shares of Class A common stock. This resulted in an expense of $2,220 which will be recorded in the second quarter of 2014. | ||||||||
RELATEDPARTY_TRANSACTIONS
RELATED-PARTY TRANSACTIONS | 3 Months Ended |
Mar. 31, 2014 | |
RELATED-PARTY TRANSACTIONS | ' |
RELATED-PARTY TRANSACTIONS | ' |
8. RELATED-PARTY TRANSACTIONS | |
Aircraft—On April 21, 2010, Manager acquired an aircraft with funds received solely from its managing member. Manager is obligated to bear all depreciation and other costs of operating the aircraft related to uses other than for the Company's business. As the aircraft is typically used for Company business purposes, the Company in the ordinary course advances Manager amounts related to the aircraft's operating costs. As of March 31, 2014, $158 was due from Manager to the Company (December 31, 2013: $58). Such amounts are included in other receivables on the condensed combined statements of financial condition. To the extent the Company utilizes the aircraft for business, the Company is obligated to incur such expenses. | |
Promissory Notes—As of March 31, 2014, the Company held an unsecured promissory note from an employee aggregating $145 (December 31, 2013: $831) which is reflected in other receivables on the condensed combined statements of financial condition. The note bears interest at a variable rate (4.75% as of March 31, 2014). During the three months ended March 31, 2014 and 2013, the Company received $686 and $383, respectively of principal repayments and recognized interest income of $4 and $11, respectively, on notes, which is included in other income and expenses on the condensed combined statements of operations. | |
Allocated Expenses—In most cases, corporate overhead expenses specific to the Advisory business were both identifiable and quantifiable, and allocated directly to the Company. The remaining corporate overhead expenses were allocated to the Company based on usage or the relative proportion of the Company's headcount to that of the Parent. | |
Management believes the assumptions and allocations underlying the condensed combined financial statements are reasonable and the allocated amounts are representative of the amounts that would have been recorded in the condensed combined financial statements had the Company been operated independent of the Parent for historical periods presented. | |
Joint Venture—As of March 31, 2014, the Company had a net balance due to the Australian JV (see Note 4) of $1,467 (December 31, 2013: $1,145), which is reflected in other assets on the condensed combined statements of financial condition. This balance consists of amounts due to the Australian JV for advisory services performed and billable expenses incurred on behalf of the Company during the period, offset by expenses paid by the Company on behalf of the Australian JV. This relationship between the Company and the Australian JV is governed by a service agreement between the Australian JV and the Parent. | |
Due from Parent—As of March 31, 2014, the Company had a net balance due from Parent of $219, which is reflected in the other assets on the condensed combined statements of financial condition. This balance consists of amounts due to the Company for expenses paid by the Company on behalf of the Parent. | |
REGULATORY_REQUIREMENTS
REGULATORY REQUIREMENTS | 3 Months Ended |
Mar. 31, 2014 | |
REGULATORY REQUIREMENTS | ' |
REGULATORY REQUIREMENTS | ' |
9. REGULATORY REQUIREMENTS | |
Under the SEC Uniform Net Capital Rule (SEC Rule 15c3-1) Alternative Standard under Section (a)(1)(ii), the minimum net capital requirement is $250. At March 31, 2014, Moelis had net capital of $121,320, which was $121,070 in excess of its required net capital. At December 31, 2013, Moelis had net capital of $101,690, which was $101,440 in excess of its required net capital. | |
Moelis does not carry customer accounts and does not otherwise hold funds or securities for, or owe money or securities to, customers and accordingly is exempt under Section (k)(2)(ii) of SEC Rule 15c3-3. | |
At March 31, 2014, the aggregate regulatory net capital of Moelis UK was $29,707 which exceeded the minimum requirement by $29,639. At December 31, 2013, the aggregate regulatory net capital of Moelis UK was $42,344, which exceeded the minimum requirement by $42,275. | |
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended | ||||
Mar. 31, 2014 | |||||
COMMITMENTS AND CONTINGENCIES | ' | ||||
COMMITMENTS AND CONTINGENCIES | ' | ||||
10. COMMITMENTS AND CONTINGENCIES | |||||
Bank Line of Credit—The Company maintains an unsecured revolving credit facility and as of March 31, 2014, the commitment amount was $25,000 and matures on June 30, 2015. | |||||
Borrowings on the facility bear interest at the greater of a fixed rate of 3.50% per annum or at the borrower's option of (i) LIBOR plus 1% or (ii) Prime minus 1.50%. As of March 31, 2014 and 2013, the Company had no borrowings under the credit facility. | |||||
As of March 31, 2014, the Company's available credit under this facility was $16,638 as a result of the issuance of an aggregate amount of $8,362 of various standby letters of credit, which were required in connection with certain office lease and other agreements. The Company incurs a 1% per annum fee on the outstanding balances of issued letters of credit. | |||||
Leases—The Company leases office space under operating leases with expiration dates that extend through 2021. During the three months ended March 31, 2014 and 2013, the Company incurred rent expense relating to its operating leases of $2,618 and $2,893, respectively. | |||||
The future minimum rental payments required under the operating leases in place at March 31, 2014 are as follows: | |||||
Fiscal year ended | Amount | ||||
Remainder of 2014 | $ | 8,306 | |||
2015 | 9,318 | ||||
2016 | 8,813 | ||||
2017 | 8,946 | ||||
2018 | 9,633 | ||||
Thereafter | 19,824 | ||||
| | | | | |
Total | $ | 64,840 | |||
| | | | | |
| | | | | |
Contractual Arrangements—In the normal course of business, the Company enters into contracts that contain a variety of representations and warranties and which provide indemnification for specified losses, including certain indemnification of certain officers, directors and employees. | |||||
Joint Venture Put and Call Options—In connection with the Company's Australian JV, the Company granted a put option in April 2010 enabling the key senior Australian executive to sell his shares held in the Australian JV back to the Company at fair value. The put option can be exercised if the key senior Australian executive ceases to be employed by the Australian JV (including due to death, disability or resignation but excluding termination for cause) and following such cessation of employment, the key senior Australian executive, the remaining Australian executives and the Company are unable to agree upon a restructuring of the Australian JV. The put option cannot be exercised prior to March 2015, except in the event of death or disability of the key senior Australian executive. If the put option is exercised, the Company will be required to pay 50% of the purchase price upon exercise and the remaining balance within 18 months (in cash or listed stock). In addition, since April 2010, the Company has held a call option to purchase the shares from the Trust at fair value with payment terms equal to those called for under the put option. | |||||
Legal—There are no legal actions pending or, to management's knowledge, threatened against the Company or any of its combined entities, other than ordinary course of business actions that we believe will not have a material adverse effect on our business or financial statements. | |||||
EMPLOYEE_BENEFIT_PLANS
EMPLOYEE BENEFIT PLANS | 3 Months Ended |
Mar. 31, 2014 | |
EMPLOYEE BENEFIT PLANS | ' |
EMPLOYEE BENEFIT PLANS | ' |
11. EMPLOYEE BENEFIT PLANS | |
The Parent covers substantially all salaried employees of the Company with a defined contribution 401(k) plan (or "Plan"). Each salaried employee of the Company who has attained the age of 21 is eligible to participate in the Plan on their first day of employment. Any employer contributions to the Plan are entirely at the discretion of the Company. During the three months ended March 31, 2014 and 2013, the Company accrued expenses of $313 and $344, respectively, relating to employer matching contributions to the Plan. | |
BUSINESS_INFORMATION
BUSINESS INFORMATION | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
BUSINESS INFORMATION | ' | |||||||
BUSINESS INFORMATION | ' | |||||||
12. BUSINESS INFORMATION | ||||||||
The Company's activities as an investment banking advisory firm constitute a single business segment offering clients, including corporations, governments and financial sponsors, a range of advisory services with expertise across all major industries in mergers and acquisitions, recapitalizations and restructurings and other corporate finance matters. | ||||||||
We do not allocate our revenue by the type of advice we provide because of the complexity of the transactions on which we may earn revenue and our comprehensive approach to client service. For example, a restructuring engagement may evolve to require a sale of all or a portion of the client, M&A assignments can develop from relationships established on prior restructuring engagements and capital markets expertise can be instrumental on both M&A and restructuring assignments. | ||||||||
For the three months ended March 31, 2014, there was one client that accounted for approximately 19% of revenues. There were no other clients that accounted for more than 10% of revenues for the three months ended March 31, 2014 or 2013. Since the financial markets are global in nature, the Company generally manages its business based on the operating results of the enterprise taken as whole, not by geographic region. The following table sets forth the geographical distribution of revenues and assets based on the location of the office that generates the revenues or holds the assets, and therefore may not be reflective of the geography in which our clients are located. | ||||||||
For the Three Months | ||||||||
Ended March 31, | ||||||||
2014 | 2013 | |||||||
Revenues: | ||||||||
United States | $ | 97,905 | $ | 51,387 | ||||
Rest of World | 16,612 | 8,458 | ||||||
| | | | | | | | |
Total | $ | 114,517 | $ | 59,845 | ||||
| | | | | | | | |
| | | | | | | | |
March 31, | December 31, | |||||||
2014 | 2013 | |||||||
Assets: | ||||||||
United States | $ | 278,088 | $ | 359,072 | ||||
Rest of World | 72,347 | 84,391 | ||||||
| | | | | | | | |
Total | $ | 350,435 | $ | 443,463 | ||||
| | | | | | | | |
| | | | | | | | |
SUBSEQUENT_EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Mar. 31, 2014 | |
SUBSEQUENT EVENTS | ' |
SUBSEQUENT EVENTS | ' |
13. SUBSEQUENT EVENTS | |
Initial Public Offering—In April 2014, Old Holdings reorganized its business in connection with an IPO of shares of Class A common stock by Moelis & Company on the New York Stock Exchange under the ticker symbol "MC". Refer to the Registration Statement filed with the SEC effective April 15, 2014 for further details related to the reorganization and IPO. | |
SUMMARY_OF_SIGNIFICANT_ACCOUNT1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Mar. 31, 2014 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' |
Basis of Accounting | ' |
Basis of Accounting—The Company prepared the accompanying condensed combined financial statements in conformity with accounting principles generally accepted in the United States of America ("U.S. GAAP"). As permitted by the interim reporting rules and regulations set forth by the SEC, the condensed combined financial statements presented exclude certain financial information and footnote disclosures normally included in audited financial statements prepared in accordance with U.S. GAAP. In the opinion of the Company's management, the accompanying unaudited condensed combined financial statements contain all adjustments, including normal recurring accruals, necessary to fairly present the accompanying unaudited condensed combined financial statements. These unaudited condensed combined financial statements should be read in conjunction with the combined audited financial statements for the year ended December 31, 2013 included in the Company's Registration Statement. | |
Use of Estimates | ' |
Use of Estimates—The preparation of condensed combined financial statements and related disclosures in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Estimates and assumptions are reviewed periodically, and the effects of revisions are reflected in the period in which they are determined to be necessary. | |
In preparing the condensed combined financial statements, management makes estimates and assumptions regarding: | |
• | |
the adequacy of the allowance for doubtful accounts; | |
• | |
the realization of deferred taxes; | |
• | |
the measurement of equity-based compensation; and | |
• | |
other matters that affect the reported amounts and disclosures of contingencies in the financial statements. | |
Expense Allocations | ' |
Expense Allocations—In addition to the revenues, expenses, assets and liabilities that are specifically identifiable to the Company, certain expenses have been allocated from the Parent based on the most relevant measure, including relative usage or proportion of the Company's headcount to that of the Parent. For the three months ended March 31, 2014 and 2013, $2,316 and $2,461, respectively, of occupancy expenses have been allocated to the Company based on the proportion of the Company's headcount to that of the Parent. For the three months ended March 31, 2014 and 2013, $2,745 and $2,303 respectively, of communication, technology and information services expenses have been allocated to the Company based on a combination of relative usage and the proportion of the Company's headcount to that of the Parent. All other expenses were specifically identifiable to the Company. Management believes the assumptions and allocations underlying the condensed combined financial statements are reasonable, and the allocated amounts are representative of the amounts that would have been recorded in the condensed combined financial statements had the Company operated independent of the Parent for the historical periods presented. | |
All intercompany balances and transactions within the Company have been eliminated. | |
Cash and Cash Equivalents | ' |
Cash and Cash Equivalents—Cash and cash equivalents include all short-term highly liquid investments that are readily convertible to known amounts of cash and have original maturities of three months or less from the date of purchase. | |
As of March 31, 2014, the Company had cash equivalents of $236,970 (December 31, 2013: $260,825) invested primarily in U.S. Treasury Bills and government securities money market funds. Additionally, as of March 31, 2014, the Company had cash of $26,396 (December 31, 2013: $42,199) maintained in U.S. and non-U.S. bank accounts, of which some account balances exceeded the FDIC coverage limit of $250. | |
Restricted Cash | ' |
Restricted Cash—The Company held cash of $799 and $792 as of March 31, 2014 and December 31, 2013, respectively, in restricted collateral accounts deposited in connection with corporate credit card programs. | |
Receivables | ' |
Receivables—The accompanying condensed combined statements of financial condition presents accounts receivable balances net of allowance for doubtful accounts based on the Company's assessment of the collectability of customer accounts. | |
The Company maintains an allowance for doubtful accounts that, in management's opinion, provides for an adequate reserve to cover losses that may be incurred. The Company regularly reviews the allowance by considering factors such as historical experience, credit quality, age of the accounts receivable and recoverable expense balances, and the current economic conditions that may affect a customer's ability to pay such amounts owed to the Company. | |
After concluding that a reserved accounts receivable is no longer collectible, the Company will charge-off the receivable. This is determined based on several factors including the age of the accounts receivable and the credit worthiness of the customer. This has the effect of reducing both the gross receivable and the allowance for doubtful accounts. | |
Deferred Compensation | ' |
Deferred Compensation—Deferred compensation costs represent arrangements with certain employees whereby cash payments are subject to a required period of service subsequent to payment by the Company. These amounts are charged to expenses over the period that the employee is required to provide services in order to vest in the payment. | |
Financial Instruments at Fair Value | ' |
Financial Instruments at Fair Value—Fair value is generally based on quoted prices, however if quoted market prices are not available, fair value is determined based on other relevant factors, including dealer price quotations, price activity for equivalent instruments and valuation pricing models. The Company established a fair value hierarchy 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 instrument, the characteristics specific to the instrument and the state of the marketplace (including the existence and transparency of transactions between market participants). Financial instruments with readily-available actively quoted prices or for which fair value can be measured from actively-quoted prices in an orderly market will generally have a higher degree of market price observability and a lesser degree of judgment used in measuring fair value. | |
Financial instruments measured and reported at fair value are classified and disclosed in one of the following categories (from highest to lowest) based on inputs: | |
Level 1—Quoted prices (unadjusted) are available in active markets for identical instruments that the Company has the ability to access as of the reporting date. The Company, to the extent that it holds such instruments, does not adjust the quoted price for these instruments, even in situations in which the Company holds a large position and a sale could reasonably affect the quoted price. | |
Level 2—Pricing inputs are observable for the instruments, either directly or indirectly, as of the reporting date, but are not the same as those used in Level 1. Fair value is determined through the use of models or other valuation methodologies. | |
Level 3—Pricing inputs are unobservable for the instruments and include situations where there is little, if any, market activity for the investments. The inputs into the determination of fair value require significant judgment or estimation by the Company's management. | |
In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the determination of which category within the fair value hierarchy is appropriate for any given investment is based on the lowest level of input that is significant to the fair value measurement. The Company's assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the instrument. | |
For level 3 investments in which pricing inputs are unobservable and limited market activity exists, management's determination of fair value is based on the best information available, may incorporate management's own assumptions and involves a significant degree of judgment. | |
Investment in Joint Venture | ' |
Investment in Joint Venture—The Company accounts for its investment in Moelis Australia Holdings under the equity method of accounting as the Company does not control the entity but jointly controls Moelis Australia Holdings with the Trust. The Company reflects its investment in investment in joint venture on the accompanying condensed combined statements of financial condition. In connection with this investment, the Company acquired a call option to purchase the remaining 50% interest in Moelis Australia Holdings. Also, in connection with the investment, the Company granted a put option enabling the key senior Australian executive to sell his remaining shares in Moelis Australia Holdings back to the Company upon certain defined exit events. The call and the put options are embedded in the equity method investment and have not been separated as embedded derivatives because they do not meet the definition of a derivative given that the investee's shares are not publicly traded. The investment reflects the Company's share of contributions made to, distributions received from, and the equity earnings and losses of, the joint venture. The Company reflects its share of gains and losses of the joint venture in income (loss) from equity method investment in the condensed combined statements of operations. | |
Equipment and Leasehold Improvements | ' |
Equipment and Leasehold Improvements—Equipment consists primarily of office equipment, computer equipment and furniture and fixtures and is stated at cost less accumulated depreciation, which is determined using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are stated at cost less accumulated amortization, which is determined using the straight-line method over the lesser of the term of the lease or the estimated useful lives of the assets. | |
Major renewals and improvements are capitalized and minor replacements, maintenance and repairs are charged to expenses as incurred. Upon retirement or disposal of assets, the cost and related accumulated depreciation or amortization are removed from the condensed combined statements of financial condition and any gain or loss is reflected in the condensed combined statements of operations. | |
Revenue and Expense Recognition | ' |
Revenue and Expense Recognition—The Company recognizes revenues from providing advisory services when earned. Upfront fees are recognized over the estimated period that the related services are performed. Transaction-related fees are recognized when all services for a transaction have been provided, specified conditions have been met and the transaction closes. Underwriting revenues are recognized when the offering is deemed complete and is presented net of related expenses. Deferred revenues are recorded for fees received that have not yet been earned. Expenses are recorded on the condensed combined statements of operations, net of client reimbursements. Reimbursable expenses billed to clients totaled $2,510 and $1,591 for the three months ended March 31, 2014 and 2013 respectively. | |
Equity-based Compensation | ' |
Equity-based Compensation—The Company recognizes the cost of partner and non-partner employee services received in exchange for an equity instrument award. The cost is based on its grant-date fair value amortized over the service period required by the award's vesting terms. The measurement of the grant-date fair value requires the Company's Parent to make estimates about its future operating results and the appropriate risk-adjusted discount rates. The methods used to estimate the fair value of equity-based compensation generally include the market approach and the income approach, each of which involve a significant degree of judgment. Under the market approach, fair value is determined with reference to observable valuation measures for comparable companies (e.g., multiplying a key performance metric of the comparable company by a relevant valuation multiple—adjusted for differences between the Company's Parent and the referenced comparable). Under the income approach, fair value is determined by converting future amounts (e.g., cash flows or earnings) to a single present amount (discounted) using current expectations about those future amounts. These estimates could change in the future and have a material impact on the estimate of the fair value. The Company recognizes such amounts in compensation and benefits expenses on the accompanying condensed combined statements of operations and as an increase to parent company equity on the accompanying condensed combined statements of financial condition and in the accompanying condensed combined statements of changes in parent company equity. See Note 7 for further discussion. | |
Income Taxes | ' |
Income Taxes—The Company's operating results were included in the Parent's U.S. federal and state income tax returns, as well as the tax filings for non-U.S. jurisdictions. For purposes of the Company's condensed combined financial statements, provision for income taxes and deferred tax balances have been calculated as if the Company completed its tax returns on a stand-alone basis separate from the Parent ("Separate Return Method"). The Separate Return Method applies the accounting guidance for income taxes to the condensed combined financial statements as if the Company were a separate taxpayer and a stand-alone enterprise from its Parent for the periods presented. | |
The Company is comprised of entities that are organized as limited liability companies and limited partnerships. For federal income tax purposes, the Company is a pass-through entity. Accordingly, no federal income taxes are assessed at the Company level. Federal income tax law and regulations require the partners to report their allocable share of the Company's taxable income or loss in their respective tax returns. Certain foreign, state and local tax authorities levy taxes on the Company based on its income. | |
The Company will continue to review the conclusions reached regarding uncertain tax positions, which may be subject to review and adjustment at a later date based on ongoing analyses of tax laws, regulations and interpretations thereof. To the extent that the Company's assessment of the conclusions reached regarding uncertain tax positions changes, such change in estimate will be recorded in the period in which such determination is made. The Company reports income tax-related interest and penalties, if applicable, as a component of income tax expense. For the three months ended March 31, 2014 and 2013, no such amounts were recognized. | |
Foreign Currency Translation | ' |
Foreign Currency Translation—Assets and liabilities held in non-U.S. dollar denominated (functional) currencies are translated into U.S. dollars at exchange rates in effect at the end of the reporting period. Revenues and expenses are translated at average exchange rates during the reporting period. A charge or credit is recorded to other comprehensive income to reflect the translation of these amounts to the extent the non-U.S. currency is designated the functional currency of the subsidiary. Non-functional currency related transaction gains and losses are immediately recorded in the condensed combined statements of operations. |
BUSINESS_CHANGES_AND_DEVELOPME1
BUSINESS CHANGES AND DEVELOPMENTS (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Reorganization and initial public offering | ' | |||||||
Summary financial information related to Moelis Australia Holdings | ' | |||||||
March 31, | December 31, | |||||||
2014 | 2013 | |||||||
Total assets | $ | 29,732 | $ | 38,465 | ||||
Total liabilities | (4,225 | ) | (15,760 | ) | ||||
| | | | | | | | |
Net equity | $ | 25,507 | $ | 22,705 | ||||
| | | | | | | | |
| | | | | | | | |
For the Three Months | ||||||||
Ended March 31, | ||||||||
2014 | 2013 | |||||||
Total revenues | $ | 3,133 | $ | 13,118 | ||||
Total expenses | (5,573 | ) | (10,282 | ) | ||||
| | | | | | | | |
Net income (loss) | $ | (2,440 | ) | $ | 2,836 | |||
| | | | | | | | |
| | | | | | | | |
Ownership percentage | 50 | % | 50 | % | ||||
Income (loss) from investment in joint venture | $ | (1,220 | ) | $ | 1,418 | |||
Pro Forma | ' | |||||||
Reorganization and initial public offering | ' | |||||||
Schedule of calculation of net income attributable to common shareholders divided by weighted average shares of Class A common stock outstanding | ' | |||||||
Pro forma net income attributable to Class A common shareholders | $ | 2,248 | ||||||
| | | | | ||||
| | | | | ||||
Weighted average shares of Class A common stock outstanding—basic and diluted | 7,699,851 | |||||||
| | | | | ||||
| | | | | ||||
Net income available to holders of Class A common stock per share | $ | 0.29 | ||||||
| | | | | ||||
| | | | | ||||
Pro forma net income attributable to Class A common shareholders | ||||||||
Income before income taxes | $ | 22,734 | ||||||
Pro forma provision for income taxes | -2,035 | (a) | ||||||
| | | | | ||||
Pro forma net income | 20,699 | |||||||
Pro forma net income attributable to noncontrolling interests | 18,451 | (b) | ||||||
| | | | | ||||
Pro forma net income attributable to Class A common shareholders | $ | 2,248 | ||||||
| | | | | ||||
| | | | | ||||
(a) | ||||||||
In connection with the reorganization, 16.48% of the outstanding partnership interests was converted directly into 7,699,851 shares of Class A common stock of Moelis & Company. An adjustment has been made to increase the effective tax rate, applied to these earnings, to 40%, which assumes the Company is taxed as a corporation. | ||||||||
(b) | ||||||||
Reflects an adjustment to record the 83.52% noncontrolling interests, net of tax, that partners of Old Holdings (other than the Company) own in Group LP relating to their partnership units. As part of the reorganization, 7,699,851 shares of Class A common stock are outstanding in Moelis & Company and 39,022,902 partnership units are held by partners of Old Holdings. | ||||||||
Basic and diluted weighted average Class A common stock outstanding | ||||||||
Basic and | ||||||||
Diluted | ||||||||
Class A common stock outstanding upon completion of the reorganization | 7,699,851 | |||||||
Class A partnership units(1) | — | |||||||
| | | | | ||||
Weighted average shares of Class A common stock outstanding upon completion of the reorganization | 7,699,851 | |||||||
| | | | | ||||
| | | | | ||||
-1 | ||||||||
Class A partnership units may be exchanged for our Class A common stock on a one-for-one basis, subject to customary conversion rate adjustments for splits, unit distributions and reclassifications and compliance with applicable lock-up, vesting and transfer restrictions. If all Class A partnership units were to be exchanged for Class A common stock immediately following the reorganization, fully diluted Class A common stock outstanding would be 46,722,753. In computing the dilutive effect, if any, that the aforementioned exchange would have on earnings per share, we consider that net income available to holders of Class A common stock would increase due to elimination of the noncontrolling interest in consolidated entities associated with the Group LP Class A partnership units (including any tax impact). For the quarter ended March 31, 2014, such exchange is not reflected in diluted earnings per share as the assumed exchange is not dilutive. | ||||||||
We have not included the impact of shares of Class B common stock because these shares are entitled to an insignificant amount of economic participation. | ||||||||
EQUIPMENT_AND_LEASEHOLD_IMPROV1
EQUIPMENT AND LEASEHOLD IMPROVEMENTS (Tables) | 3 Months Ended | |||||||||
Mar. 31, 2014 | ||||||||||
EQUIPMENT AND LEASEHOLD IMPROVEMENTS | ' | |||||||||
Schedule of equipment and leasehold improvements, net | ' | |||||||||
Useful lives | March 31, | December 31, | ||||||||
2014 | 2013 | |||||||||
Office equipment | 3 Years | $ | 7,791 | $ | 7,498 | |||||
Furniture and fixtures | 7 Years | 2,156 | 1,730 | |||||||
Leasehold improvements | 5 - 60 Months | 4,400 | 4,395 | |||||||
| | | | | | | | | | |
Total | 14,347 | 13,623 | ||||||||
Less accumulated depreciation and amortization | (9,000 | ) | (8,467 | ) | ||||||
| | | | | | | | | | |
Equipment and leasehold improvements, net | $ | 5,347 | $ | 5,156 | ||||||
| | | | | | | | | | |
| | | | | | | | | | |
FAIR_VALUE_MEASUREMENTS_Tables
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended | |||||||||||||
Mar. 31, 2014 | ||||||||||||||
FAIR VALUE MEASUREMENTS | ' | |||||||||||||
Summary of the levels of the fair value hierarchy into which the Company's financial assets and liabilities falls | ' | |||||||||||||
The following tables summarize the levels of the fair value hierarchy into which the Company's financial assets and liabilities fall as of March 31, 2014: | ||||||||||||||
Financial assets: | Total | Level 1 | Level 2 | Level 3 | ||||||||||
Included in cash and cash equivalents | ||||||||||||||
Government securities money market | $ | 77,006 | $ | — | $ | 77,006 | $ | — | ||||||
U.S. treasury bills | 119,480 | — | 119,480 | $ | — | |||||||||
Bank time deposits | 40,484 | — | 40,484 | — | ||||||||||
| | | | | | | | | | | | | | |
Total financial assets | $ | 236,970 | $ | — | $ | 236,970 | $ | — | ||||||
| | | | | | | | | | | | | | |
| | | | | | | | | | | | | | |
The following table summarizes the levels of the fair value hierarchy into which the Company's financial assets fall as of December 31, 2013: | ||||||||||||||
Financial assets: | Total | Level 1 | Level 2 | Level 3 | ||||||||||
Included in cash and cash equivalents | ||||||||||||||
Government securities money market | $ | 73,366 | $ | — | $ | 73,366 | $ | — | ||||||
U.S. treasury bills | 146,991 | — | 146,991 | — | ||||||||||
Bank time deposits | 40,468 | — | 40,468 | — | ||||||||||
Investments: | ||||||||||||||
U.S. Treasury Bills | 66,237 | — | 66,237 | — | ||||||||||
Common stock | 1,904 | — | — | 1,904 | ||||||||||
| | | | | | | | | | | | | | |
Total investments in securities | 68,141 | — | 66,237 | 1,904 | ||||||||||
| | | | | | | | | | | | | | |
Total financial assets | $ | 328,966 | $ | — | $ | 327,062 | $ | 1,904 | ||||||
| | | | | | | | | | | | | | |
| | | | | | | | | | | | | | |
Schedule of changes to the Company's investment classified as Level 3 | ' | |||||||||||||
Common Stock | ||||||||||||||
January 1, 2014 | $ | 1,904 | ||||||||||||
Non-cash settlement of customer receivable | 1,000 | |||||||||||||
Distribution to Parent | (2,904 | ) | ||||||||||||
| | | | | ||||||||||
March 31, 2014 | $ | — | ||||||||||||
| | | | | ||||||||||
| | | | | ||||||||||
Unrealized gains (losses) related to investment still held as of March 31, 2014 | $ | — | ||||||||||||
| | | | | ||||||||||
| | | | | ||||||||||
EquityBased_Compensation_Table
Equity-Based Compensation (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Management Units | ' | |||||||
Equity-based compensation | ' | |||||||
Schedule of activity related to the Management Units provided to partner and non-partner employees | ' | |||||||
Units | Weighted average | |||||||
fair value | ||||||||
at grant date | ||||||||
Outstanding at January 1, 2014 | 882,080 | $ | 270.05 | |||||
Granted | 1,609 | 1,224.00 | ||||||
Forfeited | (2,895 | ) | 836.19 | |||||
| | | | | | | | |
Outstanding at March 31, 2014 | 880,794 | $ | 269.94 | |||||
| | | | | | | | |
| | | | | | | | |
Outstanding at January 1, 2013 | 855,003 | 242.55 | ||||||
Granted | 2,495 | 791.16 | ||||||
Forfeited | (1,272 | ) | 101.75 | |||||
| | | | | | | | |
Outstanding at March 31, 2013 | 856,226 | $ | 244.72 | |||||
| | | | | | | | |
| | | | | | | | |
Schedule of activity related to the unvested Management Units provided to partner and non-partner employees | ' | |||||||
Shares | Weighted Average | |||||||
Grant Date | ||||||||
Fair Value | ||||||||
Unvested Balance at January 1, 2014 | 452,957 | $ | 485.44 | |||||
Granted | 1,609 | 1,224.00 | ||||||
Forfeited | (2,894 | ) | 836.19 | |||||
Vested | (6,352 | ) | 501.22 | |||||
| | | | | | | | |
Unvested Balance at March 31, 2014 | 445,320 | $ | 485.61 | |||||
| | | | | | | | |
| | | | | | | | |
Parent Company Investment | Management Units provided upon joining | ' | |||||||
Equity-based compensation | ' | |||||||
Summary of vesting schedule | ' | |||||||
Years 1 through 4 | 0 | % | ||||||
End of year 5 | 50 | % | ||||||
End of year 6 | 662/3 | % | ||||||
End of year 7 | 831/3 | % | ||||||
End of year 8 | 100 | % | ||||||
Parent Company Investment | Management Units are granted as part of certain partner's incentive arrangements upon joining | Partners | ' | |||||||
Equity-based compensation | ' | |||||||
Summary of vesting schedule | ' | |||||||
Years 1 and 2 | 0 | % | ||||||
End of year 3 | 331/3 | % | ||||||
End of year 4 | 662/3 | % | ||||||
End of year 5 | 100 | % |
COMMITMENTS_AND_CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES (Tables) | 3 Months Ended | ||||
Mar. 31, 2014 | |||||
COMMITMENTS AND CONTINGENCIES | ' | ||||
Schedule of future minimum rental payments required under the operating leases in place | ' | ||||
The future minimum rental payments required under the operating leases in place at March 31, 2014 are as follows: | |||||
Fiscal year ended | Amount | ||||
Remainder of 2014 | $ | 8,306 | |||
2015 | 9,318 | ||||
2016 | 8,813 | ||||
2017 | 8,946 | ||||
2018 | 9,633 | ||||
Thereafter | 19,824 | ||||
| | | | | |
Total | $ | 64,840 | |||
| | | | | |
| | | | | |
BUSINESS_INFORMATION_Tables
BUSINESS INFORMATION (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
BUSINESS INFORMATION | ' | |||||||
Schedule of geographical distribution of revenues and assets | ' | |||||||
For the Three Months | ||||||||
Ended March 31, | ||||||||
2014 | 2013 | |||||||
Revenues: | ||||||||
United States | $ | 97,905 | $ | 51,387 | ||||
Rest of World | 16,612 | 8,458 | ||||||
| | | | | | | | |
Total | $ | 114,517 | $ | 59,845 | ||||
| | | | | | | | |
| | | | | | | | |
March 31, | December 31, | |||||||
2014 | 2013 | |||||||
Assets: | ||||||||
United States | $ | 278,088 | $ | 359,072 | ||||
Rest of World | 72,347 | 84,391 | ||||||
| | | | | | | | |
Total | $ | 350,435 | $ | 443,463 | ||||
| | | | | | | | |
| | | | | | | | |
ORGANIZATION_AND_BASIS_OF_PRES1
ORGANIZATION AND BASIS OF PRESENTATION (Details) (Class A common stock) | 1 Months Ended |
Apr. 30, 2014 | |
Class A common stock | ' |
Organization and basis of presentation | ' |
Shares issued in initial public offering | 7,475,000 |
ORGANIZATION_AND_BASIS_OF_PRES2
ORGANIZATION AND BASIS OF PRESENTATION (Details 2) (Moelis Australia Holdings) | Mar. 31, 2014 | Mar. 31, 2013 |
Moelis Australia Holdings | ' | ' |
Investment in Joint Venture | ' | ' |
Ownership percentage (as a percent) | 50.00% | 50.00% |
SUMMARY_OF_SIGNIFICANT_ACCOUNT2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 |
Expense Allocations | ' | ' | ' |
Allocated occupancy expenses | $2,316 | $2,461 | ' |
Allocated communication, technology and information services expenses | 2,745 | 2,303 | ' |
Cash and Cash Equivalents | ' | ' | ' |
Cash equivalents | 236,970 | ' | 260,825 |
Cash | 26,396 | ' | 42,199 |
Restricted Cash | ' | ' | ' |
Cash in restricted collateral accounts | $799 | ' | $792 |
Moelis Australia Holdings | ' | ' | ' |
Investment in Joint Venture | ' | ' | ' |
Remaining ownership interest that may be acquired through call option (as a percent) | 50.00% | ' | ' |
SUMMARY_OF_SIGNIFICANT_ACCOUNT3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 2) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Revenue and Expense Recognition | ' | ' |
Reimbursable expenses billed to clients | $2,510 | $1,591 |
Income Taxes | ' | ' |
Revenue and Expense Recognition | $0 | $0 |
BUSINESS_CHANGES_AND_DEVELOPME2
BUSINESS CHANGES AND DEVELOPMENTS (Details) (USD $) | 1 Months Ended | 3 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Apr. 30, 2014 | Mar. 31, 2014 | Mar. 31, 2013 |
Reorganization and initial public offering | ' | ' | ' |
Distributions | $215,000 | ' | ' |
Pro forma net income attributable to Class A common shareholders | ' | 22,092 | 711 |
Pro forma net income attributable to Class A common shareholders | ' | ' | ' |
Income before income taxes | ' | 22,734 | 746 |
Provision for income taxes | ' | -642 | -35 |
Pro forma net income attributable to Class A common shareholders | ' | 22,092 | 711 |
Class A common stock | ' | ' | ' |
Reorganization and initial public offering | ' | ' | ' |
Number of shares of common stock to be issued upon exchange of a partnership unit | 1 | ' | ' |
Class A common stock | Pro Forma | ' | ' | ' |
Reorganization and initial public offering | ' | ' | ' |
Pro forma net income attributable to Class A common shareholders | ' | 2,248 | ' |
Weighted average shares of Class A common stock outstanding - basic and diluted (in shares) | ' | 7,699,851 | ' |
Net income available to holders of Class A common stock per share (in dollars per share) | ' | $0.29 | ' |
Pro forma net income attributable to Class A common shareholders | ' | ' | ' |
Income before income taxes | ' | 22,734 | ' |
Provision for income taxes | ' | -2,035 | ' |
Pro forma net income | ' | 20,699 | ' |
Pro forma net income attributable to noncontrolling interests | ' | 18,451 | ' |
Pro forma net income attributable to Class A common shareholders | ' | $2,248 | ' |
Effective tax rate (as a percent) | ' | 40.00% | ' |
Basic and diluted weighted average Class A common stock outstanding | ' | ' | ' |
Class A common stock outstanding upon completion of the reorganization | ' | 7,699,851 | ' |
Weighted average shares of Class A common stock outstanding upon completion of the reorganization | ' | 7,699,851 | ' |
Fully diluted shares of common stock outstanding if all Class A partnership units were to be exchanged for common stock immediately following the reorganization | ' | 46,722,753 | ' |
Class B common stock | ' | ' | ' |
Reorganization and initial public offering | ' | ' | ' |
Ratio of subscription price to the initial public offering price of shares of common stock | ' | 0.00055 | ' |
Dividends payable ratio to outstanding shares of publicly traded common stock | ' | 0.00055 | ' |
Number of votes entitled to holder for each share of common stock held upon satisfaction of Class B Condition | 10 | ' | ' |
Number of votes entitled to holder for each share of common stock held upon failure of Class B Condition | 1 | ' | ' |
Class B common stock | Maximum | ' | ' | ' |
Reorganization and initial public offering | ' | ' | ' |
Aggregate number of shares of Class B common stock that may be converted into Class A common stock | 20,000 | ' | ' |
Group LP | ' | ' | ' |
Reorganization and initial public offering | ' | ' | ' |
Number of principal classes of units | 1 | ' | ' |
Post reorganization partnership units | 46,722,753 | ' | ' |
Number of units held by noncontrolling interest holders | 39,022,902 | ' | ' |
Number of units converted into Class A Common stock of reporting entity | 7,699,851 | ' | ' |
Pro forma net income attributable to Class A common shareholders | ' | ' | ' |
Percentage of outstanding partnership ownership interest converted | 16.48% | ' | ' |
Noncontrolling interests (as a percent) | 83.52% | ' | ' |
Old Holdings | ' | ' | ' |
Reorganization and initial public offering | ' | ' | ' |
Partnership units converted in reorganization | 1,101,541 | ' | ' |
BUSINESS_CHANGES_AND_DEVELOPME3
BUSINESS CHANGES AND DEVELOPMENTS (Details 2) (USD $) | 3 Months Ended | 0 Months Ended | 3 Months Ended | ||||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | Apr. 01, 2011 | Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 | Apr. 01, 2010 |
Australian JV | Australian JV | Australian JV | Australian JV | Australian JV | |||
Australian trust | |||||||
Investment in Joint Venture | ' | ' | ' | ' | ' | ' | ' |
Ownership interest (as a percent) | ' | ' | ' | 50.00% | 50.00% | ' | 50.00% |
Vesting period | ' | ' | '8 years | ' | ' | ' | ' |
Additional parent company equity recognized from Australian JV equity-based contributions | ' | ' | ' | $432 | $470 | ' | ' |
Additional investment in joint venture recognized from Australian JV equity-based contributions | ' | ' | ' | 216 | 235 | ' | ' |
Contribution of equity awards recognized in other expenses | ' | ' | ' | 216 | 235 | ' | ' |
Dividends received | ' | 2,375 | ' | ' | 2,375 | ' | ' |
Cash contribution made | 4,180 | ' | ' | 4,180 | ' | ' | ' |
Summary financial information related to Moelis Australia Holdings | ' | ' | ' | ' | ' | ' | ' |
Total assets | ' | ' | ' | 29,732 | ' | 38,465 | ' |
Total liabilities | ' | ' | ' | -4,225 | ' | -15,760 | ' |
Net equity | ' | ' | ' | 25,507 | ' | 22,705 | ' |
Total revenues | ' | ' | ' | 3,133 | 13,118 | ' | ' |
Total expenses | ' | ' | ' | -5,573 | -10,282 | ' | ' |
Net income (loss) | ' | ' | ' | -2,440 | 2,836 | ' | ' |
Ownership percentage (as a percent) | ' | ' | ' | 50.00% | 50.00% | ' | 50.00% |
Income (loss) from equity method investment | ($1,220) | $1,418 | ' | ($1,220) | $1,418 | ' | ' |
EQUIPMENT_AND_LEASEHOLD_IMPROV2
EQUIPMENT AND LEASEHOLD IMPROVEMENTS (Details) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 |
Equipment and leasehold improvements | ' | ' | ' |
Total | $14,347 | ' | $13,623 |
Less accumulated depreciation and amortization | -9,000 | ' | -8,467 |
Equipment and leasehold improvements, net | 5,347 | ' | 5,156 |
Depreciation and amortization expenses | 533 | 542 | ' |
Office equipment | ' | ' | ' |
Equipment and leasehold improvements | ' | ' | ' |
Total | 7,791 | ' | 7,498 |
Useful lives | '3 years | ' | ' |
Furniture and fixtures | ' | ' | ' |
Equipment and leasehold improvements | ' | ' | ' |
Total | 2,156 | ' | 1,730 |
Useful lives | '7 years | ' | ' |
Leasehold improvements | ' | ' | ' |
Equipment and leasehold improvements | ' | ' | ' |
Total | $4,400 | ' | $4,395 |
Leasehold improvements | Minimum | ' | ' | ' |
Equipment and leasehold improvements | ' | ' | ' |
Useful lives | '5 months | ' | ' |
Leasehold improvements | Maximum | ' | ' | ' |
Equipment and leasehold improvements | ' | ' | ' |
Useful lives | '60 months | ' | ' |
FAIR_VALUE_MEASUREMENTS_Detail
FAIR VALUE MEASUREMENTS (Details) (USD $) | Dec. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | U.S. treasury bills | Total | Total | Total | Total | Total | Total | Total | Total | Total | Level 2 | Level 2 | Level 2 | Level 2 | Level 2 | Level 2 | Level 2 | Level 2 | Level 3 | Level 3 | |
Government securities money market | Government securities money market | U.S. treasury bills | U.S. treasury bills | Bank time deposits | Bank time deposits | Common Stock | Government securities money market | Government securities money market | U.S. treasury bills | U.S. treasury bills | Bank time deposits | Bank time deposits | Common Stock | ||||||||
Fair value measurements | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum investment term | ' | '6 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash and cash equivalents | ' | ' | ' | ' | $77,006 | $73,366 | $119,480 | $146,991 | $40,484 | $40,468 | ' | ' | ' | $77,006 | $73,366 | $119,480 | $146,991 | $40,484 | $40,468 | ' | ' |
Total investments in securities | 68,141 | ' | ' | 68,141 | ' | ' | ' | 66,237 | ' | ' | 1,904 | ' | 66,237 | ' | ' | ' | 66,237 | ' | ' | 1,904 | 1,904 |
Total financial assets | ' | ' | $236,970 | $328,966 | ' | ' | ' | ' | ' | ' | ' | $236,970 | $327,062 | ' | ' | ' | ' | ' | ' | $1,904 | ' |
FAIR_VALUE_MEASUREMENTS_Detail1
FAIR VALUE MEASUREMENTS (Details 2) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Changes to the Company's investment classified as Level 3 | ' | ' |
Distribution to Parent | ($2,904) | ' |
Transfers between Level 1, Level 2 or Level 3 | 0 | 0 |
Common Stock | ' | ' |
Changes to the Company's investment classified as Level 3 | ' | ' |
Balance at beginning of the period | 1,904 | ' |
Non-cash settlement of customer receivable | 1,000 | ' |
Distribution to Parent | ($2,904) | ' |
EquityBased_Compensation_Detai
Equity-Based Compensation (Details) (Parent) | 3 Months Ended |
Mar. 31, 2014 | |
Equity-based compensation | ' |
Number of units outstanding | 1,099,502 |
Management Units | ' |
Equity-based compensation | ' |
Number of units outstanding | 880,794 |
Management Units provided upon joining | ' |
Equity-based compensation | ' |
Vesting period | '8 years |
Management Units provided upon joining | Years 1 through 4 | ' |
Equity-based compensation | ' |
Vesting rights (as a percent) | 0.00% |
Management Units provided upon joining | End of year 5 | ' |
Equity-based compensation | ' |
Vesting rights (as a percent) | 50.00% |
Management Units provided upon joining | End of year 6 | ' |
Equity-based compensation | ' |
Vesting rights (as a percent) | 66.67% |
Management Units provided upon joining | End of year 7 | ' |
Equity-based compensation | ' |
Vesting rights (as a percent) | 83.33% |
Management Units provided upon joining | End of year 8 | ' |
Equity-based compensation | ' |
Vesting rights (as a percent) | 100.00% |
Management Units are granted as part of certain partner's incentive arrangements upon joining | Partners | ' |
Equity-based compensation | ' |
Vesting period | '5 years |
Management Units are granted as part of certain partner's incentive arrangements upon joining | Non-partner employees | ' |
Equity-based compensation | ' |
Vesting period | '4 years |
Management Units are granted as part of certain partner's incentive arrangements upon joining | Years 1 and 2 | Partners | ' |
Equity-based compensation | ' |
Vesting rights (as a percent) | 0.00% |
Management Units are granted as part of certain partner's incentive arrangements upon joining | End of year 3 | Partners | ' |
Equity-based compensation | ' |
Vesting rights (as a percent) | 33.33% |
Management Units are granted as part of certain partner's incentive arrangements upon joining | End of year 4 | Partners | ' |
Equity-based compensation | ' |
Vesting rights (as a percent) | 66.67% |
Management Units are granted as part of certain partner's incentive arrangements upon joining | End of year 5 | Partners | ' |
Equity-based compensation | ' |
Vesting rights (as a percent) | 100.00% |
EquityBased_Compensation_Detai1
Equity-Based Compensation (Details 2) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Significant assumptions used to develop the fair value estimates of equity-based awards | ' | ' |
Compensation expenses | $11,010 | $12,526 |
Unrecognized compensation expenses | 98,305 | ' |
Unrecognized compensation expenses to be accelerated on the initial public offering date | 87,600 | ' |
Unrecognized compensation expenses to be amortized over relevant vesting period after IPO | $10,705 | ' |
Weighted average remaining period for recognition of unrecognized compensation cost | '3 years 6 months | ' |
Partners | ' | ' |
Significant assumptions used to develop the fair value estimates of equity-based awards | ' | ' |
Forfeiture rate (as a percent) | 3.00% | ' |
Non-partner employees | ' | ' |
Significant assumptions used to develop the fair value estimates of equity-based awards | ' | ' |
Forfeiture rate (as a percent) | 5.00% | ' |
EquityBased_Compensation_Detai2
Equity-Based Compensation (Details 3) (USD $) | 3 Months Ended | 1 Months Ended | 3 Months Ended | 1 Months Ended | 3 Months Ended | ||||
In Thousands, except Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | Apr. 30, 2014 | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Apr. 30, 2014 | Mar. 31, 2014 |
Class A common stock | Management Units | Management Units | Rights | Rights | Rights | Rights | |||
Class A common stock | Class A common stock | ||||||||
Forecast | Forecast | ||||||||
Management Units provided to partner and non-partner employees, Units | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Outstanding at the beginning of the period (in shares) | ' | ' | ' | 882,080 | 855,003 | 11,832 | 11,634 | ' | ' |
Granted (in shares) | ' | ' | ' | 1,609 | 2,495 | ' | ' | ' | ' |
Forfeited (in shares) | ' | ' | ' | -2,895 | -1,272 | ' | ' | ' | ' |
Outstanding at the end of the period (in shares) | ' | ' | ' | 880,794 | 856,226 | 11,832 | 11,634 | ' | ' |
Management Units provided to partner and non-partner employees, Weighted average fair value at grant | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Outstanding at the beginning of the period (in dollars per share) | ' | ' | ' | $270.05 | $242.55 | ' | ' | ' | ' |
Granted (in dollars per share) | ' | ' | ' | $1,224 | $791.16 | ' | ' | ' | ' |
Forfeited (in dollars per share) | ' | ' | ' | $836.19 | $101.75 | ' | ' | ' | ' |
Outstanding at the end of the period (in dollars per share) | ' | ' | ' | $269.94 | $244.72 | ' | ' | ' | ' |
Unvested Management Units provided to partner and non-partner employees, Shares | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unvested Balance at the beginning of the period (in shares) | ' | ' | ' | 452,957 | ' | ' | ' | ' | ' |
Granted (in shares) | ' | ' | ' | 1,609 | ' | ' | ' | ' | ' |
Forfeited (in shares) | ' | ' | ' | -2,894 | ' | ' | ' | ' | ' |
Vested (in shares) | ' | ' | ' | -6,352 | ' | ' | ' | ' | ' |
Unvested Balance at the end of the period (in shares) | ' | ' | ' | 445,320 | ' | ' | ' | ' | ' |
Unvested Management Units provided to partner and non-partner employees, Weighted Average Grant Date Fair Value | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unvested Balance at the beginning of the period (in dollars per share) | ' | ' | ' | $485.44 | ' | ' | ' | ' | ' |
Granted (in dollars per share) | ' | ' | ' | $1,224 | ' | ' | ' | ' | ' |
Forfeited (in dollars per share) | ' | ' | ' | $836.19 | ' | ' | ' | ' | ' |
Vested (in dollars per share) | ' | ' | ' | $501.22 | ' | ' | ' | ' | ' |
Unvested Balance at the end of the period (in dollars per share) | ' | ' | ' | $485.61 | ' | ' | ' | ' | ' |
Stock issued in connection with IPO and settlement of Right | ' | ' | 7,475,000 | ' | ' | ' | ' | 88,802 | ' |
Stock issuance expense to be recorded in the second quarter of 2014 | $11,010 | $12,526 | ' | ' | ' | ' | ' | ' | $2,220 |
RELATEDPARTY_TRANSACTIONS_Deta
RELATED-PARTY TRANSACTIONS (Details) (USD $) | 3 Months Ended | 3 Months Ended | 12 Months Ended | 3 Months Ended | ||||||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 |
Parent | Manager | Manager | Employees | Employees | Employees | Australian JV | Australian JV | |||
Unsecured promissory notes | Unsecured promissory notes | Unsecured promissory notes | ||||||||
Related-party transactions | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Expenses for use of the aircraft | ' | ' | ' | $158 | $58 | ' | ' | ' | ' | ' |
Unsecured promissory notes from employees | ' | ' | ' | ' | ' | 145 | ' | 831 | ' | ' |
Fixed and variable interest rates (as a percent) | ' | ' | ' | ' | ' | 4.75% | ' | ' | ' | ' |
Principal repayments | 686 | 383 | ' | ' | ' | 686 | 383 | ' | ' | ' |
Interest income recognized | ' | ' | ' | ' | ' | 4 | 11 | ' | ' | ' |
Due to related party | ' | ' | ' | ' | ' | ' | ' | ' | 1,467 | 1,145 |
Due from related party | ' | ' | $219 | ' | ' | ' | ' | ' | ' | ' |
REGULATORY_REQUIREMENTS_Detail
REGULATORY REQUIREMENTS (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Regulatory requirements | ' | ' |
Minimum net capital requirement | $250 | ' |
Moelis | ' | ' |
Regulatory requirements | ' | ' |
Net capital | 121,320 | 101,690 |
Net capital in excess of required net capital | 121,070 | 101,440 |
Moelis UK | ' | ' |
Regulatory requirements | ' | ' |
Net capital | 29,707 | 42,344 |
Net capital in excess of required net capital | $29,639 | $42,275 |
COMMITMENTS_AND_CONTINGENCIES_1
COMMITMENTS AND CONTINGENCIES (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Leases | ' | ' |
Rent expense incurred relating to operating leases | $2,618 | $2,893 |
Future minimum rental payments | ' | ' |
Remainder of 2014 | 8,306 | ' |
2015 | 9,318 | ' |
2016 | 8,813 | ' |
2017 | 8,946 | ' |
2018 | 9,633 | ' |
Thereafter | 19,824 | ' |
Total | 64,840 | ' |
Unsecured revolving credit facility | ' | ' |
Bank line of credit | ' | ' |
Commitment amount | 25,000 | ' |
Fixed rate of interest (as a percent) | 3.50% | ' |
Borrowings under the credit facility | 0 | 0 |
Available credit under the facility | 16,638 | ' |
Unsecured revolving credit facility | LIBOR | ' | ' |
Bank line of credit | ' | ' |
Reference rate (as a percent) | 'LIBOR | ' |
Interest rate margin (as a percent) | 1.00% | ' |
Unsecured revolving credit facility | Prime | ' | ' |
Bank line of credit | ' | ' |
Reference rate (as a percent) | 'Prime | ' |
Interest rate margin (as a percent) | -1.50% | ' |
Standby letters of credit | ' | ' |
Bank line of credit | ' | ' |
Letters of credit outstanding | $8,362 | ' |
Fee on the outstanding balances (as a percent) | 1.00% | ' |
COMMITMENTS_AND_CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES (Details 2) (Australian JV) | 3 Months Ended |
Mar. 31, 2014 | |
Australian JV | ' |
Joint venture put and call options | ' |
Percentage of purchase price to be paid immediately if the Parent is public and the put option is exercised | 50.00% |
Period within which the remaining balance is to be paid if the parent is public and the put option is exercised | '18 months |
EMPLOYEE_BENEFIT_PLANS_Details
EMPLOYEE BENEFIT PLANS (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
EMPLOYEE BENEFIT PLANS | ' | ' |
Minimum age required to be eligible to participate in the plan | '21 years | ' |
Expenses accrued relating to employer matching contributions | $313 | $344 |
BUSINESS_INFORMATION_Details
BUSINESS INFORMATION (Details) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 |
Business information | ' | ' | ' |
Total revenues | $114,517 | $59,845 | ' |
Total assets | 350,435 | ' | 443,463 |
Client | ' | ' | ' |
Business information | ' | ' | ' |
Number of clients | 1 | ' | ' |
Revenue | Client | ' | ' | ' |
Business information | ' | ' | ' |
Concentration risk (as a percent) | 19.00% | ' | ' |
United States | ' | ' | ' |
Business information | ' | ' | ' |
Total revenues | 97,905 | 51,387 | ' |
Total assets | 278,088 | ' | 359,072 |
Rest of world | ' | ' | ' |
Business information | ' | ' | ' |
Total revenues | 16,612 | 8,458 | ' |
Total assets | $72,347 | ' | $84,391 |