United States securities and exchange commission logo
October 17, 2022
Jordan Licht
Chief Financial Officer
Burford Capital Limited
Oak House
Hirzel Street
St. Peter Port GY1 2NP
Guernsey
Re: Burford Capital
Limited
Form 20-F for the
Fiscal Year Ended December 31, 2021
Filed March 29,
2022
File No. 001-39511
Dear Jordan Licht:
We have reviewed your July 25, 2022 response to our comment
letter and have the
following comments. In some of our comments, we may ask you to provide
us with information
so we may better understand your disclosure.
Please respond to these comments within ten business days by
providing the requested
information or advise us as soon as possible when you will respond. If
you do not believe our
comments apply to your facts and circumstances, please tell us why in
your response.
After reviewing your response to these comments, we may have
additional
comments. Unless we note otherwise, our references to prior comments are
to comments in our
June 27, 2022 letter.
Form 20-F for the Fiscal Year Ended December 31, 2021
Consolidated statements of cash flows, page 80
1. We acknowledge your
response to prior comment 1 and our discussion on October 4,
2022. Once you fund a
capital provision asset, please describe for us any role you play in
managing capital
provision assets until settlement. As part of your response, describe the
circumstances under
which you have decision making ability over the litigation activities
and costs incurred to
support the matter.
2. We note in your cash
flows from operating activities you include a subtotal for net cash
provided by/(used in)
operating activities before funding of capital provision assets and
Jordan Licht
FirstName LastNameJordan Licht
Burford Capital Limited
Comapany
October 17,NameBurford
2022 Capital Limited
October
Page 2 17, 2022 Page 2
FirstName LastName
net (funding of)/proceeds from marketable securities. Please tell us
why you believe
presenting a total other than net cash provided by (used in) operating
activities is
consistent with the Form and Content guidance provided in ASC Subtopic
230-10-45.
Tell us how you concluded this was not a non-GAAP financial measure,
which would be
prohibited from inclusion in the financial statements under Item
10(e)(1)(ii)(C) of
Regulation S-K.
Note 2: Summary of significant accounting policies
Fair value hieracrchy
Valuation processes
Valuation methodology for Level 3 investments, page 85
3. ASC Topic 820 defines market participant as a buyer that is
knowledgeable, having a
reasonable understanding about the asset and the transaction using all
available
information that might be obtained through due diligence efforts that
are usual and
customary. As it relates to the valuation of your capital provision
assets, please tell us:
the information you obtain and consider as part of your due
diligence process to
determine the amount you will agree to pay to acquire contractual
rights to litigation
settlements or amounts receivable under court judgments;
the information you obtain and consider as part of your due
diligence process to
determine whether you should increase the amount you pay to
acquire additional
contractual rights to litigation settlements or amounts receivable
under court
judgments for cases (or pools of cases) in which you already have
investments;
whether you believe gathering and considering the information you
consider would
not be usual and customary for a knowledgeable party to obtain to
have a reasonable
understanding of the price that party would pay to acquire the
right under the
contracts you enter into, and if not why not; and
whether you view yourself as a market participant, and if not why
not.
4. ASC 820-10-35 requires that the fair value measurement as of the
reporting date use the
assumptions that a market participant would use in pricing the assets,
acting in their
economic best interest. In your period end fair value measurements of
your capital
provision assets, please describe all of the significant observable
and unobservable inputs
that you assume a market participant would use to estimate the price
they would pay as of
that date for your capital provision assets. If you do not base your
assumed market
participant assumptions on relevant data available to you, tell us why
you believe not
incorporating this data is consistent with the guidance in ASC
820-10-35-54A that states
that, A reporting entity shall develop unobservable inputs using
the best information
available in the circumstances, which might include the reporting
entity's own data.
5. ASC 820-10-35-24A describes three valuation approaches, the market
approach, cost
approach, and income approach. Please tells us whether the valuation
technique you use
to fair value your capital provision assets is consistent with one or
more of these
Jordan Licht
Burford Capital Limited
October 17, 2022
Page 3
approaches, and if so the basis for your determination. If you used an
income approach,
please clarify how you specifically considered the expected timing of
payments in
applying the guidance in ASC 820-10 55-3F which states: The income
approach converts
future amounts (for example, cash flows or income and expenses) to a
single current (that
is, discounted) amount.
6. Please tell us whether you consider the price you pay to acquire a
capital provision asset
to be fair value, and if so how you calibrate your valuation
technique, consistent with the
guidance in ASC 820-10-35-24C, such that the initial recognition of
your valuation
technique equals your transaction price.
You may contact Mark Brunhofer at 1-202-551-3638 or Sharon Blume at
1-202-551-
3474 if you have any questions.
FirstName LastNameJordan Licht Sincerely,
Comapany NameBurford Capital Limited
Division of
Corporation Finance
October 17, 2022 Page 3 Office of
Finance
FirstName LastName