UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

________________________________________

FORM 10-Q

(Mark One)*



ý☒			~~Quarterly report pursuant to Section~~QUARTERLY REPORT PURSUANT TO SECTION 13 orOR 15(d) ~~of the Securities Exchange Act of~~OF THE SECURITIES EXCHANGE ACT OF 1934

~~for~~For the quarterly period ended ~~September~~June 30, ~~2017~~2022



¨☐			~~Transition report pursuant to Section~~TRANSITION REPORT PURSUANT TO SECTION 13 orOF 15(d) ~~of the Securities Exchange Act of~~OF THE SECURITIES EXCHANGE ACT OF 1934

~~for~~For the transition period from_________to ________

~~0-10200~~

(Commission File ~~Number)~~Number: 0-10200

________________________________________

SEI INVESTMENTS COMPANY

(Exact ~~name~~Name of ~~registrant~~Registrant as ~~specified~~Specified in its ~~charter)~~Charter)

________________________________________



Pennsylvania						23-1707341
(State or ~~other jurisdiction~~Other Jurisdiction of ~~incorporation~~Incorporation or ~~organization)~~Organization)						(~~IRS~~I.R.S. Employer Identification ~~Number)~~ No.)

1 Freedom Valley Drive, Oaks, Pennsylvania 19456-1100

(Address of ~~principal executive offices)~~

~~(Zip~~Principal Executive Offices) (Zip Code)

(610) 676-1000

(Registrant’s ~~telephone number, including area code)~~Telephone Number, Including Area Code)

N/A

(Former ~~name, former address~~Name, Former Address and ~~former fiscal year,~~Former Fiscal Year, if ~~changed since last report)~~Changed Since Last Report)

~~________________________________________~~Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol

Name of each exchange on which registered

Common Stock, par value $0.01 per share

SEIC

The NASDAQ Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ýx No ¨☐

Indicate by check mark whether the registrant has submitted electronically ~~and posted on its corporate Web site, if any,~~ every Interactive Data File required to be submitted ~~and posted~~ pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit ~~and post~~ such files). Yes ýx No ¨☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, ~~or a~~ smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated ~~filer”~~filer,” “smaller reporting company,” and ~~“smaller reporting~~“emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

Accelerated filer

☐

~~Large accelerated filer~~

~~Accelerated filer~~

Non-accelerated filer

☐

¨ ~~(Do not check if a smaller reporting company)~~

Smaller reporting company

¨☐

Emerging growth company

¨☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the ~~Exchange~~ Act). Yes ¨☐ No ýx

The number of shares outstanding of the registrant’s common stock, as of ~~October 19, 2017 was 157,473,146.~~

the close of business on July 15, 2022:

~~SEI Investments Company~~
Common Stock, $0.01 par value						135,489,033

SEI INVESTMENTS COMPANY

TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION

Page

Item 1.

Financial Statements.

Consolidated Balance Sheets (Unaudited) -- ~~September~~June 30, ~~2017~~2022 and December 31, ~~2016~~2021

Consolidated Statements of Operations (Unaudited) -- For the Three and ~~Nine~~Six Months Ended ~~September~~June 30, ~~2017~~2022 and ~~2016~~2021

Consolidated Statements of Comprehensive Income (Unaudited) -- For the Three and ~~Nine~~Six Months Ended ~~September~~June 30, ~~2017~~2022 and ~~2016~~2021

Consolidated Statements of Changes in Equity (Unaudited) -- For the Three and Six Months Ended June 30, 2022 and 2021

Consolidated Condensed Statements of Cash Flows (Unaudited) -- For the ~~Nine~~Six Months Ended ~~September~~June 30, ~~2017~~2022 and ~~2016~~2021

Notes to Consolidated Financial Statements

Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations.

2429

Item 3.

Quantitative and Qualitative Disclosures About Market Risk.

3944

Item 4.

Controls and Procedures.

3944

PART II - OTHER INFORMATION

Item 1.

Legal Proceedings.

4046

Item 1A.

Risk Factors.

4146

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds.

4146

Item 6.

Exhibits.

4146

Signatures

4247

1 ~~of 42~~

PART I. FINANCIAL INFORMATION

Item 1. Consolidated Financial Statements.

SEI Investments Company

Consolidated Balance Sheets

(unaudited)

(In thousands, except par value)


	September 30, 2017		December 31, 2016			June 30, 2022		December 31, 2021
Assets					Assets
Current Assets:					Current Assets:
Cash and cash equivalents	$	684,971	$	695,701	Cash and cash equivalents	$	771,673	$	831,407
Restricted cash	3,503		3,500		Restricted cash	351		351
Receivables from investment products	50,961		61,761		Receivables from investment products	54,911		59,036
Receivables, net of allowance for doubtful accounts of $699 and $523	273,535		227,957
Receivables, net of allowance for doubtful accounts of $1,952 and $1,602					Receivables, net of allowance for doubtful accounts of $1,952 and $1,602	466,902		441,609
Securities owned	21,469		21,339		Securities owned	31,171		28,267
Other current assets	30,537		27,575		Other current assets	50,523		43,559
Total Current Assets	1,064,976		1,037,833		Total Current Assets	1,375,531		1,404,229
Property and Equipment, net of accumulated depreciation of $302,901 and $285,322	148,106		146,190
Capitalized Software, net of accumulated amortization of $340,864 and $303,540	307,116		295,867
Investments Available for Sale	82,252		84,033
Property and Equipment, net of accumulated depreciation of $424,048 and $409,248					Property and Equipment, net of accumulated depreciation of $424,048 and $409,248	178,946		178,869
Operating Lease Right-of-Use Assets					Operating Lease Right-of-Use Assets	27,629		33,614
Capitalized Software, net of accumulated amortization of $572,065 and $545,307					Capitalized Software, net of accumulated amortization of $572,065 and $545,307	230,497		243,446
Available for Sale and Equity Securities					Available for Sale and Equity Securities	121,682		129,541
Investments in Affiliated Funds, at fair value	5,738		4,858		Investments in Affiliated Funds, at fair value	6,000		6,916
Investment in Unconsolidated Affiliate	42,225		50,459		Investment in Unconsolidated Affiliate	46,865		107,918
Intangible Assets, net	82,263		—
Goodwill					Goodwill	117,405		117,232
Intangible Assets, net of accumulated amortization of $24,163 and $17,716					Intangible Assets, net of accumulated amortization of $24,163 and $17,716	61,669		68,782
Deferred Contract Costs					Deferred Contract Costs	35,353		36,236
Deferred Income Taxes	1,676		2,127		Deferred Income Taxes	2,459		2,983
Other Assets, net	17,045		15,456		Other Assets, net	30,893		24,936
Total Assets	$	1,751,397	$	1,636,823	Total Assets	$	2,234,929	$	2,354,702

The accompanying notes are an integral part of these consolidated financial statements.

2 ~~of 42~~

SEI Investments Company

Consolidated Balance Sheets

(unaudited)

(In thousands, except par value)


								June 30, 2022		December 31, 2021
Liabilities and Equity							Liabilities and Equity
Current Liabilities:							Current Liabilities:
Accounts payable	$	4,429		$	5,966		Accounts payable	$	10,305	$	10,312
Accrued liabilities	185,368			240,525			Accrued liabilities	218,752		324,382
Current portion of long-term operating lease liabilities							Current portion of long-term operating lease liabilities	10,993		11,328
Deferred revenue	3,134			2,880			Deferred revenue	13,510		9,721
Total Current Liabilities	192,931			249,371			Total Current Liabilities	253,560		355,743
Borrowings Under Revolving Credit Facility	40,000			—			Borrowings Under Revolving Credit Facility	—		40,000
Long-term Income Taxes Payable							Long-term Income Taxes Payable	803		803
Deferred Income Taxes	69,704			69,693			Deferred Income Taxes	22,833		48,876
Long-term Operating Lease Liabilities							Long-term Operating Lease Liabilities	21,675		27,639
Other Long-term Liabilities	16,221			14,645			Other Long-term Liabilities	13,970		20,878
Total Liabilities	318,856			333,709			Total Liabilities	312,841		493,939
Commitments and Contingencies							Commitments and Contingencies	0		0
Shareholders' Equity:							Shareholders' Equity:
Common stock, $.01 par value, 750,000 shares authorized; 157,405 and 159,031 shares issued and outstanding	1,574			1,590
Common stock, $0.01 par value, 750,000 shares authorized; 135,480 and 138,449 shares issued and outstanding							Common stock, $0.01 par value, 750,000 shares authorized; 135,480 and 138,449 shares issued and outstanding	1,355		1,384
Capital in excess of par value	1,002,909			955,461			Capital in excess of par value	1,272,971		1,246,608
Retained earnings	448,356			384,018			Retained earnings	693,525		632,614
Accumulated other comprehensive loss, net	(20,298		)	(37,955		)	Accumulated other comprehensive loss, net	(45,763)		(19,843)
Total Shareholders' Equity	1,432,541			1,303,114			Total Shareholders' Equity	1,922,088		1,860,763
Total Liabilities and Shareholders' Equity	$	1,751,397		$	1,636,823		Total Liabilities and Shareholders' Equity	$	2,234,929	$	2,354,702

The accompanying notes are an integral part of these consolidated financial statements.

3 ~~of 42~~

SEI Investments Company

Consolidated Statements of Operations

(unaudited)

(In thousands, except per share data)


	Three Months Ended September 30,						Nine Months Ended September 30,							Three Months Ended June 30,				Six Months Ended June 30,
	2017			2016			2017			2016				2022		2021		2022		2021
Revenues:													Revenues:
Asset management, administration and distribution fees	$	299,890		$	271,930		$	866,945		$	785,642		Asset management, administration and distribution fees	$	382,594	$	382,509	$	776,691	$	750,155
Information processing and software servicing fees	80,922			76,443			233,501			224,834			Information processing and software servicing fees	99,076		93,142		286,422		181,182
Transaction-based and trade execution fees	5,206			6,268			17,887			22,259
Total revenues	386,018			354,641			1,118,333			1,032,735			Total revenues	481,670		475,651		1,063,113		931,337
Expenses:													Expenses:
Subadvisory, distribution and other asset management costs	45,578			42,586			131,368			122,651			Subadvisory, distribution and other asset management costs	50,023		55,827		103,151		105,991
Software royalties and other information processing costs	7,463			7,519			22,837			22,944			Software royalties and other information processing costs	7,407		7,471		14,954		13,213
Brokerage commissions	3,978			4,864			13,163			17,065
Compensation, benefits and other personnel	118,421			103,137			336,919			307,350			Compensation, benefits and other personnel	157,921		141,779		318,405		279,000
Stock-based compensation	7,088			4,066			19,527			12,044			Stock-based compensation	10,007		10,103		20,573		19,855
Consulting, outsourcing and professional fees	46,507			43,631			137,991			121,712			Consulting, outsourcing and professional fees	63,271		55,449		125,762		109,789
Data processing and computer related	18,449			16,581			53,104			48,081			Data processing and computer related	32,254		27,375		62,070		53,096
Facilities, supplies and other costs	18,604			17,075			54,764			50,194			Facilities, supplies and other costs	20,133		18,479		37,760		35,727
Amortization	13,745			11,388			38,332			33,684			Amortization	16,508		14,723		33,395		29,075
Depreciation	6,948			6,576			20,347			19,457			Depreciation	8,286		8,424		16,384		16,733
Total expenses	286,781			257,423			828,352			755,182			Total expenses	365,810		339,630		732,454		662,479
Income from operations	99,237			97,218			289,981			277,553			Income from operations	115,860		136,021		330,659		268,858
Net gain from investments	645			196			1,036			320
Net (loss) gain from investments													Net (loss) gain from investments	(2,620)		377		(3,109)		709
Interest and dividend income	1,899			1,026			4,928			3,142			Interest and dividend income	1,853		878		2,701		1,823
Interest expense	(345		)	(115		)	(571		)	(416		)	Interest expense	(211)		(130)		(461)		(253)
Equity in earnings of unconsolidated affiliate	39,333			32,565			109,213			92,042			Equity in earnings of unconsolidated affiliate	29,813		35,065		62,272		68,415
Gain on sale of subsidiary	—			—			—			2,791
Income before income taxes	140,769			130,890			404,587			375,432			Income before income taxes	144,695		172,211		392,062		339,552
Income taxes	39,030			44,186			122,342			130,226			Income taxes	33,419		38,433		90,478		76,304
Net income	$	101,739		$	86,704		$	282,245		$	245,206		Net income	$	111,276	$	133,778	$	301,584	$	263,248
Basic earnings per common share	$	0.64		$	0.54		$	1.78		$	1.51		Basic earnings per common share	$	0.82	$	0.94	$	2.20	$	1.85
Shares used to compute basic earnings per share	157,902			160,916			158,439			161,908			Shares used to compute basic earnings per share	136,435		142,074		137,185		142,638
Diluted earnings per common share	$	0.63		$	0.53		$	1.74		$	1.49		Diluted earnings per common share	$	0.81	$	0.93	$	2.17	$	1.82
Shares used to compute diluted earnings per share	161,148			163,925			161,866			165,053			Shares used to compute diluted earnings per share	137,817		144,212		138,764		144,759
Dividends declared per common share	$	—		$	—		$	0.28		$	0.26		Dividends declared per common share	$	0.40	$	0.37	$	0.40	$	0.37

The accompanying notes are an integral part of these consolidated financial statements.

4 ~~of 42~~

SEI Investments Company

Consolidated Statements of Comprehensive Income

(unaudited)

(In thousands)

Three Months Ended September 30, Nine Months Ended September 30,
2017 2016 2017 2016
Net income $ 101,739
$ 86,704
$ 282,245
$ 245,206
Other comprehensive gain (loss), net of tax:
Foreign currency translation adjustments 7,318
(3,053 ) 17,028
(5,704 )
Unrealized gain (loss) on investments:
Unrealized gains (losses) during the period, net of income taxes of $(116), $94, $(148) and $(146) 294
(160 ) 435
190

Less: reclassification adjustment for losses realized in net income, net of income taxes of $(41), $(52), $(84) and $(143) 105
399
102
(58 ) 194
629
266
456
Total other comprehensive gain (loss), net of tax 7,717
(3,111 ) 17,657
(5,248 )
Comprehensive income $ 109,456
$ 83,593
$ 299,902
$ 239,958


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Net income	$	111,276	$	133,778	$	301,584	$	263,248
Other comprehensive (loss) income, net of tax:
Foreign currency translation adjustments	(14,623)		994		(19,181)		2,679
Unrealized loss on investments:
Unrealized losses during the period, net of income taxes of $923, $85, $2,109 and $245	(3,088)		(292)		(7,057)		(835)
Reclassification adjustment for losses realized in net income, net of income taxes of $(39), $(49), $(96) and $(123)	129		179		318		432
Total other comprehensive (loss) income, net of tax	(17,582)		881		(25,920)		2,276
Comprehensive income	$	93,694	$	134,659	$	275,664	$	265,524

The accompanying notes are an integral part of these consolidated financial statements.

SEI Investments Company

Consolidated Statements of Changes in Equity

(unaudited)

(In thousands)


	Shares of Common Stock	Common Stock		Capital In Excess of Par Value		Retained Earnings		Accumulated Other Comprehensive Loss		Total Equity
	For the Three Months Ended June 30, 2022
Balance, April 1, 2022	137,219	$	1,372	$	1,266,320	$	733,572	$	(28,181)	$	1,973,083
Net income	—	—		—		111,276		—		111,276
Other comprehensive loss	—	—		—		—		(17,582)		(17,582)
Purchase and retirement of common stock	(1,970)	(20)		(12,328)		(96,945)		—		(109,293)
Issuance of common stock under employee stock purchase plan	22	1		1,089		—		—		1,090
Issuance of common stock upon exercise of stock options	209	2		7,883		—		—		7,885
Stock-based compensation	—	—		10,007		—		—		10,007
Dividends declared ($0.40 per share)	—	—		—		(54,378)		—		(54,378)
Balance, June 30, 2022	135,480	$	1,355	$	1,272,971	$	693,525	$	(45,763)	$	1,922,088


	Shares of Common Stock	Common Stock		Capital In Excess of Par Value		Retained Earnings		Accumulated Other Comprehensive Loss		Total Equity
	For the Three Months Ended June 30, 2021
Balance, April 1, 2021	142,701	$	1,427	$	1,208,433	$	634,651	$	(15,403)	$	1,829,108
Net income	—	—		—		133,778		—		133,778
Other comprehensive income	—	—		—		—		881		881
Purchase and retirement of common stock	(2,086)	(21)		(12,389)		(116,809)		—		(129,219)
Issuance of common stock under employee stock purchase plan	18	—		966		—		—		966
Issuance of common stock upon exercise of stock options	394	4		12,374		—		—		12,378
Stock-based compensation	—	—		10,103		—		—		10,103
Dividends declared ($0.37 per share)	—	—		—		(52,389)		—		(52,389)
Balance, June 30, 2021	141,027	$	1,410	$	1,219,487	$	599,231	$	(14,522)	$	1,805,606

The accompanying notes are an integral part of these consolidated financial statements.

~~5 of 42~~

SEI Investments Company

Consolidated Statements of Changes in Equity

(unaudited)

(In thousands)



	Shares of Common Stock	Common Stock		Capital In Excess of Par Value		Retained Earnings		Accumulated Other Comprehensive Loss		Total Equity
	For the Six Months Ended June 30, 2022
Balance, January 1, 2022	138,449	$	1,384	$	1,246,608	$	632,614	$	(19,843)	$	1,860,763
Net income	—	—		—		301,584		—		301,584
Other comprehensive loss	—	—		—		—		(25,920)		(25,920)
Purchase and retirement of common stock	(3,683)	(37)		(23,051)		(186,295)		—		(209,383)
Issuance of common stock under employee stock purchase plan	45	1		2,257		—		—		2,258
Issuance of common stock upon exercise of stock options	669	7		26,584		—		—		26,591
Stock-based compensation	—	—		20,573		—		—		20,573
Dividends declared ($0.40 per share)	—	—		—		(54,378)		—		(54,378)
Balance, June 30, 2022	135,480	$	1,355	$	1,272,971	$	693,525	$	(45,763)	$	1,922,088



	Shares of Common Stock	Common Stock		Capital In Excess of Par Value		Retained Earnings		Accumulated Other Comprehensive Loss		Total Equity
	For the Six Months Ended June 30, 2021
Balance, January 1, 2021	143,396	$	1,434	$	1,190,001	$	565,270	$	(16,798)	$	1,739,907
Net income	—	—		—		263,248		—		263,248
Other comprehensive income	—	—		—		—		2,276		2,276
Purchase and retirement of common stock	(3,238)	(32)		(19,228)		(176,898)		—		(196,158)
Issuance of common stock under employee stock purchase plan	42	—		2,105		—		—		2,105
Issuance of common stock upon exercise of stock options	827	8		26,754		—		—		26,762
Stock-based compensation	—	—		19,855		—		—		19,855
Dividends declared ($0.37 per share)	—	—		—		(52,389)		—		(52,389)
Balance, June 30, 2021	141,027	$	1,410	$	1,219,487	$	599,231	$	(14,522)	$	1,805,606

The accompanying notes are an integral part of these consolidated financial statements.

SEI Investments Company

Consolidated Condensed Statements of Cash Flows

(unaudited)

(In thousands)


	Nine Months Ended September 30,							Six Months Ended June 30,
	2017			2016				2022		2021
Cash flows from operating activities:							Cash flows from operating activities:
Net income	$	282,245		$	245,206		Net income	$	301,584	$	263,248
Adjustments to reconcile net income to net cash provided by operating activities (See Note 1)	34,139			44,228			Adjustments to reconcile net income to net cash provided by operating activities (See Note 1)	29,031		61,749
Net cash provided by operating activities	316,384			289,434			Net cash provided by operating activities	330,615		324,997
Cash flows from investing activities:							Cash flows from investing activities:
Additions to property and equipment	(20,318		)	(26,656		)	Additions to property and equipment	(19,821)		(15,469)
Additions to capitalized software	(48,573		)	(33,196		)	Additions to capitalized software	(13,809)		(12,271)
Purchases of marketable securities	(50,235		)	(55,162		)	Purchases of marketable securities	(96,642)		(81,541)
Prepayments and maturities of marketable securities	52,644			42,625			Prepayments and maturities of marketable securities	90,553		64,194
Sales of marketable securities	—			1,225			Sales of marketable securities	106		—
Cash paid for acquisition, net of cash acquired	(80,131		)	—
Receipt of contingent payment from sale of SEI AK	—			2,791
Other investing activities	(1,450		)	1,313			Other investing activities	(2,903)		(11,000)
Net cash used in investing activities	(148,063		)	(67,060		)	Net cash used in investing activities	(42,516)		(56,087)
Cash flows from financing activities:							Cash flows from financing activities:
Borrowings under revolving credit facility	40,000			—
Repayments under revolving credit facility							Repayments under revolving credit facility	(40,000)		—
Payment of contingent consideration							Payment of contingent consideration	(868)		(3,965)
Purchase and retirement of common stock	(186,494		)	(224,815		)	Purchase and retirement of common stock	(210,324)		(197,322)
Proceeds from issuance of common stock	41,626			35,159			Proceeds from issuance of common stock	28,849		28,867
Payment of dividends	(88,862		)	(84,686		)	Payment of dividends	(109,830)		(105,516)
Net cash used in financing activities	(193,730		)	(274,342		)	Net cash used in financing activities	(332,173)		(277,936)
Effect of exchange rate changes on cash and cash equivalents	14,679			(4,531		)
Net decrease in cash and cash equivalents	(10,730		)	(56,499		)
Cash and cash equivalents, beginning of period	695,701			679,661
Cash and cash equivalents, end of period	$	684,971		$	623,162
Effect of exchange rate changes on cash, cash equivalents and restricted cash							Effect of exchange rate changes on cash, cash equivalents and restricted cash	(15,660)		2,578
Net decrease in cash, cash equivalents and restricted cash							Net decrease in cash, cash equivalents and restricted cash	(59,734)		(6,448)
Cash, cash equivalents and restricted cash, beginning of period							Cash, cash equivalents and restricted cash, beginning of period	831,758		787,727
Cash, cash equivalents and restricted cash, end of period							Cash, cash equivalents and restricted cash, end of period	$	772,024	$	781,279

The accompanying notes are an integral part of these consolidated financial statements.

~~6 of 42~~

Notes to Consolidated Financial Statements

(all figures are in thousands except share and per share data)

Note 1. Summary of Significant Accounting Policies

Nature of Operations

SEI Investments Company (the Company), a Pennsylvania corporation, provides ~~investment processing,~~comprehensive platforms, services and infrastructure–encompassing technology, operational, and investment management ~~and investment operations solutions~~ services–to ~~financial institutions,~~help wealth managers, financial advisors, ~~institutional investors,~~ investment managers, family offices, institutional and ~~ultra-high-net-worth families in the United States, Canada, the United Kingdom, continental Europe~~private investors create and ~~various other locations throughout the world.~~ manage wealth.

Investment processing ~~solutions consist of application~~platforms provide technologies and business process outsourcing services ~~professional~~for wealth managers and investment advisors. These solutions include investment advisory, client relationship, and other technology-enabled capabilities for the front office; administrative and investment services for the middle office; and ~~transaction-based services.~~accounting and processing services for the back office. Revenues from investment processing ~~solutions~~platforms are recognized in Information processing and software servicing fees on the accompanying Consolidated Statements of ~~Operations, except for fees earned associated with trade execution services which are recognized in Transaction-based and trade execution fees.~~Operations.

Investment ~~management programs consist~~operations platforms provide business process outsourcing services for investment managers and asset owners. These platforms support a broad range of ~~mutual funds,~~traditional and alternative investments and ~~separate accounts. These include a series of money market, equity, fixed-income~~provide technology-enabled information analytics and ~~alternative investment portfolios, primarily in~~investor capabilities for the ~~form of registered investment companies. The Company serves as the administrator~~front office; administrative and investment ~~advisor~~services for ~~many of these products.~~the middle office; and fund administration and accounting services for the back office. Revenues from investment ~~management programs~~operations platforms are recognized in Asset management, administration and distribution fees on the accompanying Consolidated Statements of Operations.

Investment ~~operations~~management platforms provide comprehensive solutions ~~offer~~for managing personal and institutional wealth. These platforms include goals-based investment ~~managers support for traditional~~strategies; SEI-sponsored investment products, ~~such as~~including mutual funds, collective investment ~~trusts, exchange-traded funds,~~products, alternative investment portfolios and separately managed accounts (SMA); and other market-specific advice, technology and operational components. These platforms are offered to wealth managers as part of a complete goals-based investment program for their end-investors. For institutional investors, the Company provides Outsourced Chief Investment Officer (OCIO) solutions that include investment management programs, as well as advisory and separate accounts, by providing outsourcing services including fund and investment accounting, administration, reconciliation, investor servicing and client reporting. These solutions also provide support to managers focused on alternative investments who manage hedge funds, funds of hedge funds, private equity funds and real estate funds, across registered, partnership and separate account structures domiciled in the United States and overseas.administrative services. Revenues from investment ~~operations solutions~~management platforms are recognized in Asset management, administration and distribution fees on the accompanying Consolidated Statements of Operations.

Basis of Presentation

The accompanying Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America. Certain financial information and accompanying note disclosure normally included in the Company’s Annual Report on Form 10-K have been condensed or omitted. The interim financial information is unaudited but reflects all adjustments (consisting of only normal recurring adjustments) which are, in the opinion of management, necessary for a fair statement of financial position of the Company as of ~~September~~June 30, ~~2017~~,2022, the results of operations for the three and ~~nine~~six months ended ~~September~~June 30, ~~2017~~2022 and ~~2016~~,2021, and cash flows for the ~~nine-month periods~~six-months ended ~~September~~June 30, ~~2017~~2022 and ~~2016~~.2021. These interim Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and the Notes to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2016~~.2021.

There have been no significant changes in significant accounting policies during the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2022 as compared to the significant accounting policies described in the ~~Company’s~~Company's Annual Report on Form 10-K for the year ended December 31, ~~2016 with~~2021.

Variable Interest Entities

The Company or its affiliates have created numerous investment products for its clients in various types of legal entity structures. The Company serves as the ~~exception~~Manager, Administrator and Distributor for these investment products and may also serve as the Trustee for some of the ~~adoption of Accounting Standards Update (ASU) 2016-09, Improvements~~investment products. The Company receives asset management, distribution, administration and custodial fees for these services. Clients are the equity investors and participate in proportion to ~~Employee Share-Based Payment Accounting (ASU 2016-09)~~their ownership percentage in the net income or loss and ~~the addition~~net capital gains or losses of the ~~accounting policies related~~products, and, on liquidation, will participate in proportion to ~~business combinations and intangible assets. As required by ASU 2016-09, excess tax benefits recognized on stock-based compensation expense are reflected~~their ownership percentage in the ~~accompanying Consolidated Statements of Operations as a component~~remaining net assets of the provision for income taxes on a prospective basis (See Note 11). Additionally, excess tax benefits or deficiencies recognized on stock-based compensation expense are classified as an operating activity in the accompanying Consolidated Statementsproducts after satisfaction of ~~Cash Flows.~~outstanding liabilities. The Company has ~~applied this provision retrospectively~~concluded that it is not the primary beneficiary of the entities and, therefore, is not required to consolidate any of the pooled investment vehicles for which it receives asset management, distribution, administration and custodial fees under the ~~periods prior~~VIE model.

agreements, the Company waived $9,039 and $11,256 in fees during the three months ended June 30, 2022 and 2021, respectively. During the six months ended June 30, 2022 and 2021, the Company waived $20,224 and $21,489, respectively, in fees.

Revenue Recognition

Revenue is recognized when the transfer of control of promised goods or services under the terms of a contract with customers are satisfied in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those promised goods or services. Certain portions of the Company’s revenues involve a third party in providing goods or services to its customers. In such circumstances, the Company must determine whether the nature of its promise to the ~~date of adoption. As a result, for~~customer is to provide the ~~nine months ended September 30, 2016, net cash provided by operating activities increased by $5,941 with a corresponding offset to net cash used for financing activities.~~

~~ASU 2016-09 also allows for~~underlying goods or services (the Company is the option to account for forfeitures as they occur when determining the amount of compensation cost to be recognized, rather than estimating expected forfeitures over the course of a vesting period. The Company elected to account for forfeitures as they occur. In addition, ASU 2016-09 eliminates anticipated windfalls and shortfalls that were includedprincipal in the ~~calculation of assumed proceeds~~transaction and reports the transaction gross) or to arrange for ~~computing~~a third party to provide the ~~dilutive effect of share-based payment awards~~underlying goods or services (the entity is the agent in the ~~calculation of diluted earnings per share. No adjustments to~~transaction and reports the ~~Company's prior period reported diluted earnings per share amounts were permitted by ASU 2016-09.~~

The net cumulative effect to the Company from the adoption of ASU 2016-09 was an increase to paid-in capital of $2,582, a reduction to retained earnings of $1,669 and an increase to deferred tax assets of $913 as of January 1, 2017.

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transaction net). See Note 13 for related disclosures regarding revenue recognition.

Cash and Cash Equivalents

Cash and cash equivalents includes ~~$298,869~~$320,825 and ~~$374,760~~$290,256 at ~~September~~June 30, ~~2017~~2022 and December 31, ~~2016~~,2021, respectively, primarily invested in SEI-sponsored open-ended money market mutual funds. ~~The SEI-sponsored mutual funds are Level 1 assets.~~

Restricted Cash

Restricted cash includes ~~$3,000~~$250 at ~~September~~June 30, ~~2017~~2022 and December 31, ~~2016~~2021 segregated for regulatory purposes related to trade-execution services conducted by SEI Investments (Europe) Limited. Restricted cash also includes ~~$503~~$101 at June 30, 2022 and ~~$500 at~~ ~~September 30, 2017~~ ~~and~~ December 31, ~~2016, respectively,~~2021 segregated in special reserve accounts for the benefit of customers of the Company’s broker-dealer subsidiary, SEI Investments Distribution Co. (SIDCO), in accordance with certain rules established by the Securities and Exchange Commission (SEC) for broker-dealers.

Capitalized Software

The Company capitalized ~~$48,573~~$13,809 and ~~$33,196~~$12,271 of software development costs during the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2022 and ~~2016,~~2021, respectively. The Company's software development costs primarily relate to ~~the continued development of~~significant enhancements to the SEI Wealth Platform^SM~~(the Platform)~~(SWP). ~~The Company capitalized $40,604 and $27,387 of software development costs for significant enhancements to the Platform during the nine months ended September 30, 2017 and 2016, respectively.~~ As of ~~September~~June 30, ~~2017,~~2022, the net book value of ~~the Platform~~SWP was ~~$283,639~~$224,736. The net book value includes ~~$27,344~~$28,744 of capitalized software development costs in-progress associated with future ~~releases. The Platform~~releases of SWP. Capitalized software development costs in-progress associated with future releases of SWP were $29,253 as of December 31, 2021. SWP has ~~an estimated useful life of 15 years and~~ a weighted average remaining life of ~~4.7~~10.3 years. Amortization expense for ~~the Platform~~SWP was ~~$37,324~~$23,859 and ~~$33,387~~$23,876 during the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2022 and ~~2016,~~2021, respectively.

The amount of amortization expense recognized related to the SEI Wealth Platform is based upon management’s estimate of its useful life. Management continually reassesses the estimated useful life of the Platform and any change in management's estimate could result in the remaining amortization expense to be accelerated or spread out over a longer period (See the caption "SEI Wealth Platform - Estimated Useful Life" of Management’s Discussion and Analysis of Financial Condition and Results of Operations in Item 2 for more information).

The Company also capitalized $7,969 and $5,809 of software development costs during the nine months ended September 30, 2017 and 2016, respectively, related to an application for the Investment Managers segment. Capitalized software development costs in-progress at September 30, 2017 associated with the application were $23,477. The application is not yet ready for use.

~~Business Combinations~~

The Company accounts for business combinations in accordance with Accounting Standards Codification Topic 805, Business Combinations (ASC 805). ASC 805 establishes principles and requirements for recognizing the total consideration transferred, assets acquired and liabilities assumed in a business combination. ASC 805 also provides guidance for recognizing and measuring goodwill acquired in a business combination and requires the acquirer to disclose information needed to evaluate and understand the financial impact of the business combination. The Company recognizes assets and liabilities acquired at their estimated fair values. Management uses judgment to identify the acquired assets and liabilities assumed; estimate the fair value of these assets and liabilities; estimate the useful life of the assets; and assess the appropriate method for recognizing depreciation or amortization expense over the estimated useful life of the assets.

~~Intangible Assets~~

The Company reviews long-lived assets and identifiable definite-lived intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of these assets may not be recoverable. For purposes of recognizing and measuring an impairment loss, a long-lived asset is grouped with other assets and liabilities at the lowest level for which identifiable cash flows are largely independent.

Identifiable definite-lived intangible assets on the Company’s Consolidated Balance Sheet are amortized on a straight-line basis according to their estimated useful lives (See Note 14). Goodwill recorded is not amortized but is reviewed for impairment annually or more frequently if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. The provisions of accounting guidance require that a two-step, fair value based test be performed to assess goodwill for impairment. In the first step, the fair value of each reporting unit is compared with its carrying value, including goodwill. If the fair value exceeds the carrying value, goodwill is not impaired and no further testing is performed. The second step is performed if the carrying value exceeds the fair value. The second step requires an allocation of fair value to the individual assets and liabilities using a purchase price allocation in order to determine the implied fair value of goodwill. If the implied fair value of goodwill is less than the carrying amount, an impairment loss is recognized.

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Earnings per Share

The calculations of basic and diluted earnings per share for the three and ~~nine~~six months ended ~~September~~June 30, ~~2017~~2022 and ~~2016~~2021 are:


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Net income	$	111,276	$	133,778	$	301,584	$	263,248
Shares used to compute basic earnings per common share	136,435,000		142,074,000		137,185,000		142,638,000
Dilutive effect of stock options	1,382,000		2,138,000		1,579,000		2,121,000
Shares used to compute diluted earnings per common share	137,817,000		144,212,000		138,764,000		144,759,000
Basic earnings per common share	$	0.82	$	0.94	$	2.20	$	1.85
Diluted earnings per common share	$	0.81	$	0.93	$	2.17	$	1.82

Three Months Ended September 30, Nine Months Ended September 30,
2017 2016 2017 2016
Net income $ 101,739
$ 86,704
$ 282,245
$ 245,206
Shares used to compute basic earnings per common share 157,902,000
160,916,000
158,439,000
161,908,000
Dilutive effect of stock options 3,246,000
3,009,000
3,427,000
3,145,000
Shares used to compute diluted earnings per common share 161,148,000
163,925,000
161,866,000
165,053,000
Basic earnings per common share $ 0.64
$ 0.54
$ 1.78
$ 1.51
Diluted earnings per common share $ 0.63
$ 0.53
$ 1.74
$ 1.49

During the three months ended ~~September~~June 30,, ~~2017~~ 2022 and ~~2016~~,2021, employee stock options to purchase ~~11,324,000~~12,064,000 and ~~10,258,000~~11,530,000 shares of common stock with an average exercise price of ~~$37.81~~$60.27 and ~~$34.11~~,$57.77, respectively, were outstanding but not included in the computation of diluted earnings per common share. During the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2022 and ~~2016,~~2021, employee stock options to purchase ~~11,286,000~~12,141,000 and ~~10,384,000~~11,623,000 shares of common stock with an average exercise price of ~~$37.73~~$60.28 and ~~$34.07,~~$57.77, respectively, were outstanding but not included in the computation of diluted earnings per common share. These options for the three and ~~nine~~six month periods were not included in the computation of diluted earnings per common share because either the performance conditions have not been satisfied or would not have been satisfied if the reporting date was the end of the contingency period or the ~~option’s~~options' exercise price was greater than the average market price of the Company’s common stock and the effect on diluted earnings per common share would have been anti-dilutive.

~~Reclassifications~~

~~Certain prior year amounts have been reclassified to conform to current year presentation.~~

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Statements of Cash Flows

For purposes of the Consolidated Statements of Cash Flows, the Company considers investment instruments purchased with an original maturity of three months or less to be cash equivalents.

The following table provides the details of the adjustments to reconcile net income to net cash provided by operating activities for the ~~nine~~six months ended ~~September~~June 30:


	2022		2021
Net income	$	301,584	$	263,248
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation	16,384		16,733
Amortization	33,395		29,075
Equity in earnings of unconsolidated affiliate	(62,272)		(68,415)
Distributions received from unconsolidated affiliate	69,824		68,064
Stock-based compensation	20,573		19,855
Provision for losses on receivables	350		2,088
Deferred income tax expense	(23,506)		(6,869)
Net loss (gain) from investments	3,109		(709)

Change in other long-term liabilities	1,998		987
Change in other assets	(3,111)		(976)
Contract costs capitalized, net of amortization	883		429
Other	(1,521)		929
Change in current assets and liabilities
(Increase) decrease in
Receivables from investment products	4,125		(906)
Receivables	(25,523)		(26,437)
Other current assets	(7,014)		538
Advances due from unconsolidated affiliate	53,500		51,364
(Decrease) increase in
Accounts payable	(7)		1,525
Accrued liabilities	(55,734)		(25,721)
Deferred revenue	3,578		195
Total adjustments	29,031		61,749
Net cash provided by operating activities	$	330,615	$	324,997

2017 2016
Net income $ 282,245
$ 245,206
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation 20,347
19,457
Amortization 38,332
33,684
Equity in earnings of unconsolidated affiliate (109,213 ) (92,042 )
Distributions received from unconsolidated affiliate 117,447
102,246
Stock-based compensation 19,527
12,044
Provision for losses on receivables 176
338
Deferred income tax expense 1,143
(1,521 )
Gain from sale of SEI AK —
(2,791 )
Net gain from investments (1,036 ) (320 )
Tax benefit on stock options exercised (1) —
5,941
Change in other long-term liabilities 106
2,706
Change in other assets 79
(2,463 )
Other 1,067
602
Change in current assets and liabilities
Decrease (increase) in
Receivables from investment products 10,800
(685 )
Receivables (43,661 ) (25,037 )
Other current assets (2,962 ) (4,072 )
Increase (decrease) in
Accounts payable (1,748 ) 2,497
Accrued liabilities (15,856 ) (6,945 )
Deferred revenue (409 ) 589
Total adjustments 34,139
44,228
Net cash provided by operating activities $ 316,384
$ 289,434

~~(1) The tax benefit on stock options exercised for the nine months ended September 30, 2016 was reclassified to operating activities from financing activities upon the adoption of ASU 2016-09.~~

~~New Accounting Pronouncements~~

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) (ASU 2014-09), requiring an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. ASU 2014-09 also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. The updated standard permits the use of either the retrospective or cumulative effect transition method. The FASB has issued several amendments to the standard, including principal versus agent guidance and identifying performance obligations. ASU 2014-09 will become effective for the Company during the first quarter 2018.

The Company continues to assess the impact of ASU 2014-09 on its revenue arrangements. The Company expects the adoption of ASU 2014-09 to have an impact to its business processes, financial reporting disclosures and internal controls over financial reporting.

As part of its project plan’s preliminary assessment and design implementation phases for the adoption of ASU 2014-09, the Company has adopted implementation controls that allows it to properly and timely adopt ASU 2014-09 on the effective date. The Company will make continuous updates to the quarterly and year-end disclosures, with a focus on both status and

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internal controls over financial reporting. The new standard will have a significant impact to the Company's financial statement disclosures, including identifying information that the Company will have to develop under the new standard.

~~The Company’s implementation plan includes the following:~~

~~Developed a phased implementation project plan with a specific timeline and milestones;~~

~~Developed an understanding of the new standard and its requirements;~~

~~Analyzed the Company’s revenue streams;~~

~~Gathering and evaluating the required and relevant information for ASU 2014-09; and~~

~~Continue to monitor the impact of ASU 2014-09 and the various interpretations and supplemental guidance that become available.~~

~~Upon its initial assessment, the Company has made the following observations:~~

~~Revenue:~~

The Company offers many services which are bundled together, and provided and completed for the client on a monthly basis. In assessing these contracts, the Company expects to continue to recognize revenue for these types of services on a monthly basis as the client consumes the benefits continuously over time. Similarly, the Company expects that transaction-based and trade execution fees based on current period activity will not be affected by the adoption of ASU 2014-09.

The Company continues to assess the effect of the adoption of the new standard on the timing of the recognition of implementation fees, which are recognized in Information processing and software servicing fees as well as fund conversion fees and other ancillary fees recognized in Asset management, administration and distribution fees. While the Company has not made a final determination, the timing of the recognition for these revenues may change.

~~The new standard also modified some of the principal and agent considerations which may result in changes to gross or net treatment of revenue and expenses but would not affect final net income.~~

~~Contract costs:~~

The Company expects to capitalize the costs of obtaining the contracts related to the information processing and software servicing fees revenue stream affected by the standard. Sales commissions and contract costs related to fund conversions are also expected to be capitalized. Under current guidance, contract costs are expensed at inception of an agreement but under the new standard, the costs will generally be capitalized and amortized over the period of customer life as defined in the new standard, unless a practical expedient is applied to fully expense contract costs for contracts with an amortization period of one year or less.

~~Transition method:~~

The new standard provides companies with alternative methods of adoption. The Company is in the process of determining the method of adoption, which depends in part upon the completion of the evaluation of the remaining revenue arrangements. The Company anticipates it will elect the cumulative effect transition method.

Upon completion of the Company’s implementation plan and evaluation of the remaining revenue contracts, the Company plans to adopt additional controls around internal controls over financial reporting and its business processes for any new revenue arrangements that the Company enters. The Company is on target to complete its assessment of ASU 2014-09 and the impact on the Company’s consolidated financial statements and related disclosures as of January 1, 2018.

In February 2016, the FASB issued ASU No. 2016-02, Leases (ASU 2016-02) requiring lessees to recognize a right-of-use asset and a lease liability on the balance sheet for all leases with the exception of short-term leases. For lessees, leases will continue to be classified as either operating or finance leases in the income statement. Lessor accounting is similar to the current model but updated to align with certain changes to the lessee model. Lessors will continue to classify leases as operating, direct financing or sales-type leases. The new standard must be adopted using a modified retrospective transition and requires application of the new guidance at the beginning of the earliest comparative period presented. The updated standard is effective for the Company beginning in the first quarter of 2019. Early adoption is permitted. The Company is currently evaluating the transition method that will be elected and the effect that the updated standard will have on its consolidated financial statements and related disclosures.

In January 2017, the FASB issued ASU 2017-04, Simplifying the Test for Goodwill Impairment (ASU 2017-04). The objective of ASU 2017-04 is to simplify the subsequent measurement of goodwill by entities performing their annual goodwill impairment tests by comparing the fair value of a reporting unit, including income tax effects from any tax-deductible goodwill, with its carrying amount and recognizing an impairment charge for the amount by which the carrying amount exceeds fair value. ASU 2017-04 is effective for the Company beginning in the first quarter of 2020. Early adoption is permitted. The

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~~Company is currently evaluating the impact of adopting ASU 2017-04 on its consolidated financial statements and related disclosures.~~


~~Note 2.~~	~~Investment in Unconsolidated Affiliate~~

Note 2. Investment in Unconsolidated Affiliate

LSV Asset Management

The Company has an investment in LSV Asset Management (LSV), a registered investment advisor that provides investment advisory services primarily to institutions, including pension plans and investment companies. LSV is currently an investment sub-advisor for a limited number of SEI-sponsored ~~mutual funds.~~investment products. The Company's partnership interest in LSV as of June 30, 2022 was 38.6%. The Company accounts for its interest in LSV using the equity method because of its less than 50 ~~percent~~50% ownership. The Company’s interest in the net assets of LSV is reflected in Investment in unconsolidated affiliate on the accompanying Consolidated Balance Sheets and its interest in the earnings of LSV is reflected in Equity in earnings of unconsolidated affiliate on the accompanying Consolidated Statements of Operations.

At ~~September~~June 30, ~~2017~~,2022, the Company’s total investment in LSV was ~~$42,225~~.$46,865. The Company receives partnership distributions from LSV on a quarterly basis. The Company received partnership distributions from LSV of ~~$117,447~~$69,824 and ~~$102,246~~$68,064 in the ~~nine~~six months ended ~~September~~June 30,, ~~2017~~ 2022 and ~~2016~~,2021, respectively. As such, the Company considers these distribution payments as returns on investment rather than returns of the Company's original investment in LSV and has therefore classified the associated cash inflows as an operating activity on the Consolidated Statements of Cash Flows.

The Company’s proportionate share in the earnings of LSV was ~~$39,333~~$29,813 and ~~$32,565~~$35,065 during the three months ended ~~September~~June 30,, ~~2017~~ 2022 and ~~2016~~,2021, respectively. During the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2022 and ~~2016,~~2021, the Company's proportionate share in the earnings of LSV was ~~$109,213~~$62,272 and ~~$92,042,~~$68,415, respectively.

These tables contain condensed financial information of LSV:

Condensed Statement of Operations Three Months Ended September 30, Nine Months Ended September 30,
2017 2016 2017 2016
Revenues $ 126,723
$ 103,341
$ 355,996
$ 291,819
Net income 101,130
83,646
280,717
235,893


Condensed Statement of Operations	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Revenues	$	99,814	$	116,392	$	208,264	$	227,229
Net income	77,193		90,520		160,984		176,440


Condensed Balance Sheets	June 30, 2022		December 31, 2021
Current assets	$	118,021	$	171,058
Non-current assets	5,329		4,792
Total assets	$	123,350	$	175,850

Current liabilities	$	53,683	$	82,858
Non-current liabilities	3,465		3,863
Partners’ capital	66,202		89,129
Total liabilities and partners’ capital	$	123,350	$	175,850

Condensed Balance Sheets

September 30, 2017 December 31, 2016
Current assets $ 136,299
$ 125,872
Non-current assets 1,553
1,927
Total assets $ 137,852
$ 127,799

Current liabilities $ 71,555
$ 39,303
Partners’ capital 66,297
88,496
Total liabilities and partners’ capital $ 137,852
$ 127,799

InOn April ~~2016,~~1, 2022, LSV provided an interest in the partnership to select key employees which reduced the ownership percentage of each existing partner on a pro-rata basis. As a result, the Company's total partnership interest in LSV was reduced slightly to approximately 38.6% from approximately ~~39.2 percent to approximately 38.9 percent.~~

~~Guaranty Agreement with LSV Employee Group III~~38.7%.

~~In October 2012, LSV Employee Group III purchased a portion of the partnership interest of three existing LSV employees for~~ ~~$77,700, of which~~ ~~$69,930~~ ~~was financed through two syndicated term loan facilities contained in a credit agreement with The PrivateBank and Trust Company. The Company provided an unsecured guaranty for~~ ~~$45,000~~ of the obligations of LSV Employee Group III to the lenders through a guaranty agreement. The lenders had the right to seek payment from the Company in the event of a default by LSV Employee Group III. LSV provided an unsecured guaranty for ~~$24,930~~ ~~of the obligations of LSV Employee Group III to the lenders through a separate guaranty agreement.~~

The Company’s direct interest in LSV was unchanged as a result of this transaction. The Company determined that LSV Employee Group III was a variable interest entity (VIE); however, the Company was not considered the primary beneficiary because it did not have the power to direct the activities that most significantly impact the economic performance of LSV Employee Group III either directly or through any financial responsibility from the guaranty.

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In September 2014 and June 2017, LSV Employee Group III made the final principal payments related to the term loans guaranteed by LSV and the Company, respectively, and has no further obligation regarding the agreement. The Company has no other interests in LSV Employee Group III and, therefore, no longer considers LSV Employee Group III to be a VIE.

~~Note 3. Variable Interest Entities – Investment Products~~

The Company or its affiliates have created numerous investment products for its clients in various types of legal entity structures. The Company serves as the Manager, Administrator and Distributor for these investment products and may also serve as the Trustee for some of the investment products. The Company receives asset management, distribution, administration and custodial fees for these services. Clients are the equity investors and participate in proportion to their ownership percentage in the net income or loss and net capital gains or losses of the products, and, on liquidation, will participate in proportion to their ownership percentage in the remaining net assets of the products after satisfaction of outstanding liabilities.

The Company has concluded that it is not the primary beneficiary of the entities and; therefore, is not required to consolidate any of the pooled investment vehicles for which it receives asset management, distribution, administration and custodial fees under the VIE model. The entities either do not meet the definition of a VIE or the Company does not hold a variable interest in the entities. The entities either qualify for the money market scope exception, or are entities in which the Company’s asset management, distribution, administration and custodial fees are commensurate with the services provided and include fair terms and conditions, or are entities that are limited partnerships which have substantive kick-out rights. The Company acts as a fiduciary and does not hold any other interests other than insignificant seed money investments in the pooled investment vehicles. For this reason, the Company also concluded that it is not required to consolidate the pooled investment vehicles under the voting interest entity (VOE) model.

The Company is a party to expense limitation agreements with certain SEI-sponsored money market funds subject to Rule 2a-7 of the Investment Company Act of 1940 which establish a maximum level of ordinary operating expenses incurred by the fund in any fiscal year including, but not limited to, fees of the administrator or its affiliates. Under the terms of these agreements, the Company waived $6,942 and $9,145 in fees during the three months ended September 30, 2017 and 2016, respectively. During the nine months ended September 30, 2017 and 2016, the Company waived $20,620 and $31,513, respectively, in fees.


~~Note 4.~~	~~Composition of Certain Financial Statement Captions~~

Note 3. Composition of Certain Financial Statement Captions

Receivables

Receivables on the accompanying Consolidated Balance Sheets consist of:

September 30, 2017 December 31, 2016
Trade receivables $ 68,968
$ 48,683
Fees earned, not billed 192,214
168,971
Other receivables 13,052
10,826
274,234
228,480
Less: Allowance for doubtful accounts (699 ) (523 )
$ 273,535
$ 227,957


	June 30, 2022		December 31, 2021
Trade receivables	$	107,853	$	111,209
Fees earned, not billed	337,445		315,255
Other receivables	23,556		16,747
	468,854		443,211
Less: Allowance for doubtful accounts	(1,952)		(1,602)
	$	466,902	$	441,609

Fees earned, not billed represents receivables from contracts with customers earned but unbilled and results from timing differences between services provided and contractual billing schedules. These billing schedules generally provide for fees to be billed on a quarterly basis. In addition, certain fees earned from investment operations services are calculated based on assets under administration that have ~~a prolonged~~an extended valuation ~~process which delays billings~~process. Billings to ~~clients.~~these clients occur once the asset valuation processes are completed.

Receivables from investment products on the accompanying Consolidated Balance Sheets primarily represent fees receivable for distribution, investment advisory, and administration services to various regulated investment companies and other investment products sponsored by SEI.

~~13 of 42~~

Property and Equipment

Property and Equipment on the accompanying Consolidated Balance Sheets consists of:

September 30, 2017 December 31, 2016
Buildings $ 153,952
$ 152,171
Equipment 114,122
106,759
Land 10,030
10,030
Purchased software 133,320
128,008
Furniture and fixtures 17,950
17,292
Leasehold improvements 17,121
15,175
Construction in progress 4,512
2,077
451,007
431,512
Less: Accumulated depreciation (302,901 ) (285,322 )
Property and Equipment, net $ 148,106
$ 146,190


	June 30, 2022		December 31, 2021
Buildings	$	209,907	$	209,766
Equipment	167,591		153,158
Land	26,411		24,651
Purchased software	156,569		156,387
Furniture and fixtures	21,323		21,254
Leasehold improvements	20,617		21,946
Construction in progress	576		955
	602,994		588,117
Less: Accumulated depreciation	(424,048)		(409,248)
Property and Equipment, net	$	178,946	$	178,869

The Company recognized ~~$20,347~~$16,384 and ~~$19,457~~$16,733 in depreciation expense related to property and equipment for the ~~nine~~six months ended ~~September~~June 30,, ~~2017~~ 2022 and ~~2016~~,2021, respectively.

Deferred Contract Costs

Deferred contract costs, which primarily consist of deferred sales commissions, were $35,353 and $36,236 as of June 30, 2022 and December 31, 2021, respectively. The Company deferred expenses related to contract costs of $1,543 and $1,674 during the three months ended June 30, 2022 and 2021, respectively. During the six months ended June 30, 2022 and 2021, the Company deferred expenses related to contract costs of $5,062 and $4,046, respectively. Amortization expense related to deferred contract costs were $5,945 and $4,475 during the six months ended June 30, 2022 and 2021, respectively. Amortization expense during the six months ended June 30, 2022 includes $1,784 in expense accelerated as a result of the termination of a contractual agreement with a significant client (See Note 13). Amortization expense related to deferred contract costs is included in Compensation, benefits and other personnel on the accompanying Consolidated Statements of Operations. There was no impairment loss in relation to deferred contract costs during the six months ended June 30, 2022.

Accrued Liabilities

Accrued liabilities on the accompanying Consolidated Balance Sheets consist of:


	June 30, 2022		December 31, 2021
Accrued employee compensation	$	52,418	$	107,933
Accrued employee benefits and other personnel	9,749		13,951
Accrued consulting, outsourcing and professional fees	47,067		36,411
Accrued sub-advisory, distribution and other asset management fees	58,400		58,661

Accrued dividend payable	—		55,452

Other accrued liabilities	51,118		51,974
Total accrued liabilities	$	218,752	$	324,382

September 30, 2017 December 31, 2016
Accrued employee compensation $ 63,313
$ 79,735
Accrued consulting, outsourcing and professional fees 29,487
24,428
Accrued sub-advisory, distribution and other asset management fees 38,631
41,666
Accrued dividend payable —
44,596
Other accrued liabilities 53,937
50,100
Total accrued liabilities $ 185,368
$ 240,525

Note 5.4. Fair Value Measurements

The fair value of the Company’s financial assets and liabilities, except for the Company's investment funds sponsored by LSV, is determined in accordance with the fair value hierarchy. The fair value of the Company’s Level 1 financial assets consist mainly of investments in open-ended mutual funds that are quoted daily. Level 2 financial assets consist of ~~Government National Mortgage Association (GNMA)~~GNMA mortgage-backed securities held by the Company's wholly-owned limited purpose federal thrift subsidiary, SEI Private Trust Company (SPTC), Federal Home Loan Bank (FHLB) and other U.S. government agency short-term notes held by SIDCO. The financial assets held by SIDCO were purchased as part of a cash management program requiring only short term, top-tier investment grade government and corporate securities. The financial assets held by SPTC are debt securities issued by GNMA and are backed by the full faith and credit of the U.S. government. These securities were purchased for the sole purpose of satisfying applicable regulatory requirements and have maturity dates which range from ~~2020~~2023 to 2041.

The fair value of the Company's investment funds sponsored by LSV is measured using the net asset value per share (NAV) as a practical expedient. The NAVs of the funds are calculated by the funds' independent custodian and are derived from the fair values of the underlying investments as of the reporting date. The funds allow for investor redemptions at the end of each calendar month. This investment has not been classified in the fair value hierarchy but is presented in the tables below to permit reconciliation to the amounts presented on the accompanying Consolidated Balance Sheets.

The valuation of the Company's Level 2 financial assets held by SIDCO and SPTC are based upon securities pricing policies and procedures utilized by third-party pricing vendors.

The pricing policies and procedures applied for our Level 1 and Level 2 financial assets during the ~~nine~~six months ended ~~September~~June 30,, ~~2017~~ 2022 were consistent with those as described in ~~our~~the Company's Annual Report on Form 10-K at December 31, ~~2016~~.2021. The Company had no Level 3 financial assets at ~~September~~June 30, ~~2017~~2022 or December 31, ~~2016~~2021 that were required to be measured at fair value on a recurring basis. ~~The Company's~~ Level 3 financial liabilities at ~~September~~June 30, ~~2017~~2022 and December 31, 2021 consist entirely of the estimated contingent consideration ~~of $4,800~~ resulting from an acquisition (See Note ~~14)~~12). ~~The current portion of the contingent consideration is included in Accrued liabilities on the accompanying Consolidated Balance Sheet. The long-term portion of the~~

~~14 of 42~~

~~contingent consideration is included in Other Long-Term Liabilities on the accompanying Consolidated Balance Sheet.~~ The fair value of the contingent consideration was determined using a Monte-Carlo simulation model. Key assumptions for the Monte-Carlo simulation model include expected revenues, expected volatility, risk-free rate and correlation coefficient. There was no material change in the fair value of the contingent consideration from the acquisition date through September 30, 2017. The Company had no Level 3 financial liabilities as of December 31, 2016 that were required to be measured at fair value on a recurring basis.other factors. There were no transfers of financial assets between levels within the fair value hierarchy during the ~~nine~~six months ended ~~September~~June 30,, ~~2017~~. 2022.

The fair value of certain financial assets of the Company was determined using the following inputs:


			Fair Value Measurements at the End of the Reporting Period Using
Assets	June 30, 2022		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)
Equity securities	$	10,812	$	10,812	$	—
Available-for-sale debt securities	110,870		—		110,870
Fixed-income securities owned	31,171		—		31,171
Investment funds sponsored by LSV (1)	6,000
	$	158,853	$	10,812	$	142,041

Fair Value Measurements at the End of the Reporting Period Using
Assets September 30, 2017
Quoted Prices
in
Active Markets
for Identical
Assets
(Level 1)

Significant
Other
Observable
Inputs
(Level 2)
Equity available-for-sale securities $ 10,863
$ 10,863
$ —
Fixed-income available-for-sale securities 71,389
—
71,389
Fixed-income securities owned 21,469
—
21,469
Investment funds sponsored by LSV (1) 5,738

$ 109,459
$ 10,863
$ 92,858

Fair Value Measurements at the End of the Reporting Period Using
Assets December 31, 2016
Quoted Prices
in
Active Markets
for Identical
Assets
(Level 1)

Significant
Other
Observable
Inputs
(Level 2)
Equity available-for-sale securities $ 9,581
$ 9,581
$ —
Fixed-income available-for-sale securities 74,452
—
74,452
Fixed-income securities owned 21,339
—
21,339
Investment funds sponsored by LSV (1) 4,858

$ 110,230
$ 9,581
$ 95,791


			Fair Value Measurements at the End of the Reporting Period Using
Assets	December 31, 2021		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)
Equity securities	$	12,406	$	12,406	$	—
Available-for-sale debt securities	117,135		—		117,135
Fixed-income securities owned	28,267		—		28,267
Investment funds sponsored by LSV (1)	6,916
	$	164,724	$	12,406	$	145,402

(1) The fair value amounts presented in the tables above are intended to permit reconciliation of the fair value hierarchy to the amounts presented on the accompanying Consolidated Balance Sheets (See Note 6)5).

Note 6.5. Marketable Securities

Marketable securities include investments in money market funds and commercial paper classified as cash equivalents, available-for-sale debt securities, investments in SEI-sponsored and non-SEI-sponsored mutual funds, equities, investments in funds sponsored by LSV and securities owned by SIDCO.

Cash Equivalents

Investments in money market funds and commercial paper classified as cash equivalents had a fair value of $458,521 and $422,838 at June 30, 2022 and December 31, 2021, respectively. There were no material unrealized or realized gains or losses from these investments during the six months ended June 30, 2022 and 2021. Investments in money market funds and commercial paper are Level 1 assets.

Available for Sale and Equity Securities

~~Investments available for sale classified as non-current assets~~Available For Sale and Equity Securities on the accompanying Consolidated Balance Sheets consist of:


	At June 30, 2022
	Cost Amount		Gross Unrealized Gains		Gross Unrealized (Losses)		Fair Value
Available-for-sale debt securities	$	119,702	$	—	$	(8,832)	$	110,870
SEI-sponsored mutual funds	6,271		—		(249)		6,022
Equities and other mutual funds	4,870		—		(80)		4,790
	$	130,843	$	—	$	(9,161)	$	121,682


											At December 31, 2021
	At September 30, 2017										Cost Amount		Gross Unrealized Gains		Gross Unrealized (Losses)		Fair Value
	Cost Amount		Gross Unrealized Gains		Gross Unrealized (Losses)			Fair Value
Available-for-sale debt securities										Available-for-sale debt securities	$	117,215	$	—	$	(80)	$	117,135
SEI-sponsored mutual funds	$	7,317	$	106	$	(290	)	$	7,133	SEI-sponsored mutual funds	6,748		463		—		7,211
Equities and other mutual funds	3,373		357		—			3,730		Equities and other mutual funds	4,935		260		—		5,195
Debt securities	71,837		—		(448		)	71,389
	$	82,527	$	463	$	(738	)	$	82,252		$	128,898	$	723	$	(80)	$	129,541

~~15 of 42~~

At December 31, 2016

Cost
Amount

Gross
Unrealized
Gains

Gross
Unrealized
(Losses)

Fair
Value
SEI-sponsored mutual funds $ 7,357
$ 24
$ (996 ) $ 6,385
Equities and other mutual funds 2,968
228
—
3,196
Debt securities 74,843
—
(391 ) 74,452
$ 85,168
$ 252
$ (1,387 ) $ 84,033

Net unrealized losses at ~~September~~June 30, ~~2017 and~~ ~~December 31, 2016~~2022 of available-for-sale debt securities were ~~$207~~$6,801 (net of income tax benefit of ~~$68) and~~ ~~$836~~$2,031). Net unrealized losses at December 31, 2021 of available-for-sale debt securities were $62 (net of income tax benefit of ~~$299), respectively.~~$18). These unrealized losses are associated with the Company’s investments in mortgage-backed securities issued by GNMA and were caused by interest rate increases (See Note 4). The contractual cash flows of these securities are guaranteed by an agency of the U.S. government. Accordingly, it is expected that the securities would not be settled at a price less than the amortized cost bases of the Company's investments. The Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost bases. These net unrealized losses are reported as a separate component of Accumulated other comprehensive loss on the accompanying Consolidated Balance Sheets.

There were gross realized ~~gains of~~ ~~$428~~ ~~and gross realized~~ losses of ~~$706~~$414 and $556 from available-for-sale debt securities during the ~~nine~~six months ended ~~September~~June 30,, ~~2017~~. 2022 and 2021, respectively. There were no gross realized gains of ~~$270~~ ~~and gross realized losses of $679~~ from available-for-sale debt securities during the ~~nine~~six months ended ~~September~~June 30,, ~~2016. Gains~~ 2022 and 2021. Realized losses from available-for-sale debt securities, including amounts reclassified from accumulated comprehensive loss, are reflected in Net (loss) gain from investments on the accompanying Consolidated Statements of Operations.

There were gross realized gains of $7 and gross realized losses of $658 from mutual funds and equities during the six months ended June 30, 2022. There were gross realized gains of $613 and gross realized losses of $59 from mutual funds and equities during the six months ended June 30, 2021. Gains and losses from mutual funds and equities are reflected in Net (loss) gain from investments on the accompanying Consolidated Statements of Operations.

Investments in Affiliated Funds

The Company has an investment in funds sponsored by LSV. The Company records this investment on the accompanying Consolidated Balance Sheets at fair value. Unrealized gains and losses from the change in fair value of these funds are recognized in Net (loss) gain from investments on the accompanying Consolidated Statements of Operations.

The investment primarily consists of U.S. dollar denominated funds that invest primarily in securities of Canadian, Australian and Japanese companies as well as various other global securities. The underlying securities held by the funds are translated into U.S. dollars within the funds. The funds had a fair value of ~~$5,738~~$6,000 and ~~$4,858~~$6,916 at ~~September~~June 30, ~~2017~~2022 and December 31, ~~2016~~,2021, respectively. The Company recognized unrealized losses of $1,270 and unrealized gains of ~~$388 and $880~~$309 during the three ~~and nine~~ months ended ~~September~~June 30, ~~2017,~~2022 and 2021, respectively, from the change in fair value of the funds. The Company recognized unrealized losses of $916 and unrealized gains of ~~$468 and $849~~$766 during the ~~three and nine~~six months ended ~~September~~June 30, ~~2016,~~2022 and 2021, respectively, from the change in fair value of the funds.

Securities Owned

The Company’s broker-dealer subsidiary, SIDCO, has investments in U.S. government agency securities with maturity dates less than one year. These investments are reflected as Securities owned on the accompanying Consolidated Balance Sheets. Due to specialized accounting practices applicable to investments by broker-dealers, the securities are reported at fair value and changes in fair value are recorded in current period earnings. The securities had a fair value of ~~$21,469~~$31,171 and ~~$21,339~~$28,267 at ~~September~~June 30, ~~2017~~2022 and December 31, ~~2016~~,2021, respectively. There were no material net gains or losses ~~from the change in fair value of~~related to the securities during the three and ~~nine~~six months ended ~~September~~June 30, ~~2017~~2022 and 2021.

~~2016~~.

Note 7.6. Line of Credit

The Company has a five-year ~~$300,000~~$325,000 Credit Agreement (the Credit Facility) with Wells Fargo Bank, ~~National Association,~~N.A., and a syndicate of other lenders. The Credit Facility is scheduled to expire in ~~June 2021,~~April 2026, at which time any aggregate principal amount of loans outstanding becomes payable in full. Any borrowings made under the Credit Facility will accrue interest at rates that, at the Company's option, are based on a base rate (the Base Rate) plus a premium that can range from ~~0.25 percent~~0.25% to ~~1.00 percent~~1.00% or the London InterBank Offered Rate (LIBOR) plus a premium that can range from ~~1.25 percent~~1.25% to ~~2.00 percent~~2.00% depending on the Company’s Leverage Ratio (a ratio of consolidated indebtedness to consolidated EBITDA for the ~~four~~4 preceding fiscal quarters, all as defined in the related agreement). The Base Rate is defined as the highest of a) the Federal Funds Rate, as published by the Federal Reserve Bank of New York, plus ~~0.50 percent,~~0.50%, b) the prime commercial lending rate of Wells Fargo, c) the applicable LIBOR plus ~~1.00 percent,~~1.00%, or d) ~~0 percent.~~ 0%. The Credit Facility includes fallback language clearly defining an alternative reference rate which provides for specified replacement rates upon a LIBOR cessation event. At the time of a LIBOR cessation event, the replacement rate, the Secured Overnight Financing Rate (SOFR), self-executes without the need for negotiations or a formal amendment process.

The Company also pays quarterly commitment fees based on the unused portion of the Credit Facility. The quarterly fees for the Credit Facility can range from ~~0.15 percent~~0.15% of the amount of the unused portion to ~~0.30 percent,~~0.30%, depending on the Company’s Leverage Ratio. Certain wholly-owned subsidiaries of the Company have guaranteed the obligations of the Company under the agreement. The aggregate amount of the Credit Facility may be increased by an additional $100,000 under certain conditions set forth in the agreement. The Company may issue up to $15,000 in letters of credit under the terms of the Credit Facility. The Company pays a periodic commission fee of 1.25% plus an issuance fee of 0.200% of the aggregate face amount of the outstanding letters of credit issued under the Credit Facility.

The Credit Facility contains covenants ~~that restrict~~with restrictions on the ability of the Company to ~~engage in mergers, consolidations, asset sales, investments,~~do transactions with affiliates other than wholly-owned subsidiaries or to incur liens or certain types of indebtedness as defined in the agreement. In the event of a default under the Credit Facility, the Company would also be restricted from paying dividends on, or repurchasing, its common stock without the approval of the lenders. ~~None of the covenants of the Credit Facility negatively affect the Company’s liquidity or capital~~

~~16 of 42~~

~~resources.~~ Upon the occurrence of certain financial or economic events, significant corporate events, or certain other events of default constituting an event of default under the Credit Facility, all loans outstanding may be declared immediately due and payable and all commitments under the agreement may be terminated.

In ~~July 2017,~~November 2021, the Company borrowed $40,000 under the Credit Facility for the funding of an acquisition (See Note ~~14)~~12). AsDuring the six months ended June 30, 2022, the Company made principal payments of ~~September 30, 2017,~~$40,000 to fully repay the outstanding balance of the Credit ~~Facility was $40,000~~Facility.

As of July 15, 2022, the Company had outstanding letters of credit of $6,003 under the Credit Facility. These letters of credit were issued primarily for the expansion of the Company's headquarters and ~~is included in Borrowings Under Revolving~~are scheduled to expire during 2022. The amount of the Credit Facility ~~on the accompanying Consolidated Balance Sheet.~~ that is available for general corporate purposes as of July 15, 2022 was $318,997.

The Company was in compliance with all covenants of the Credit Facility during the ~~nine~~six months ended ~~September~~June 30, ~~2017.~~2022.

~~In October 2017, the Company made a principal payment of $10,000. As of October 19, 2017, the amount of the Credit Facility that is available for general corporate purposes was $270,000.~~

~~The Company considers the book value of long-term debt related to the borrowings through the Credit Facility to be representative of its fair value.~~

Note 8.7. Shareholders’ Equity

Stock-Based Compensation

The Company has only non-qualified stock options and restricted stock units outstanding under its equity compensation plans. All outstanding stock options have performance-based vesting provisions specific to each option grant that tie the vesting of the applicable stock options to the Company’s financial performance. The Company’s stock options vest at a rate of 50 ~~percent~~50% when a specified ~~diluted earnings per share~~financial vesting target is achieved, and the remaining 50 ~~percent~~50% when a second, higher specified ~~diluted earnings per share~~financial vesting target is achieved. Options ~~do not~~ vest ~~due to the passage of time but solely~~ as a result of achievement of the financial vesting targets. Options granted in December 2017 and thereafter include a service condition which requires a minimum two or four year waiting period from the grant date along with the attainment of the applicable financial vesting target. The targets are measured annually on December 31. The amount of stock-based compensation expense recognized in the period is based upon management’s estimate of when the ~~earnings per share~~financial vesting targets may be achieved. Any change in ~~management's~~management’s estimate could result in the remaining amount of stock-based compensation expense to be accelerated, spread out over a longer period, or reversed. This may cause volatility in the recognition of stock-based compensation expense in future periods and could materially affect the Company’s ~~net income and net income per share.~~ earnings. The Company's restricted stock units outstanding vest ratably over four years commencing March 31, 2022.

The Company recognized stock-based compensation expense in its Consolidated Financial Statements in the three and ~~nine~~six months ended ~~September~~June 30, ~~2017~~2022 and ~~2016~~,2021, respectively, as follows:


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Stock-based compensation expense	$	10,007	$	10,103	$	20,573	$	19,855
Less: Deferred tax benefit	(1,839)		(1,904)		(3,934)		(3,758)
Stock-based compensation expense, net of tax	$	8,168	$	8,199	$	16,639	$	16,097

Three Months Ended September 30, Nine Months Ended September 30,
2017 2016 2017 2016
Stock-based compensation expense $ 7,088
$ 4,066
$ 19,527
$ 12,044
Less: Deferred tax benefit (2,517 ) (1,466 ) (6,859 ) (4,235 )
Stock-based compensation expense, net of tax $ 4,571
$ 2,600
$ 12,668
$ 7,809
The Company revised its estimate of when some vesting targets are expected to be achieved. This change in management's estimate resulted in a decrease of $663 in stock-based compensation expense during the six months ended June 30, 2022.

As of ~~September~~June 30, ~~2017,~~2022, there was approximately ~~$57,525~~$82,733 of unrecognized compensation cost remaining related to unvested employee stock options and restricted stock units that management expects will vest and is being amortized.

The Company issues new common shares associated with the exercise of stock options. The total intrinsic value of options exercised during the ~~nine~~six months ended ~~September~~June 30,, ~~2017~~ 2022 was ~~$59,991~~.$12,806. The total options exercisable as of ~~September~~June 30, ~~2017~~2022 had an intrinsic value of ~~$192,056~~.$61,515. The total intrinsic value for options exercisable is calculated as the difference between the market value of the Company’s common stock as of ~~September~~June 30, ~~2017~~2022 and the weighted average exercise price of the ~~shares.~~options. The market value of the Company’s common stock as of ~~September~~June 30, ~~2017~~2022 was ~~$61.06~~$54.02 as reported by the Nasdaq Stock Market, LLC. The weighted average exercise price of the options exercisable as of ~~September~~June 30, ~~2017~~2022 was ~~$21.34~~.$49.40. Total options that were outstanding as of ~~September~~June 30, ~~2017~~2022 were ~~16,158,000~~18,072,000. Total options that were exercisable as of ~~September~~June 30, ~~2017~~2022 were ~~4,835,000.~~7,911,000.

The Company initiated a voluntary separation program to long-tenured employees in June 2022. Certain allowances provided to the participating employees in the program are expected to result in modifications to the Company's equity compensation plans related to the vesting of stock options during the remainder of 2022 and the period in which the employee may exercise vested stock options after the termination of employment (See Note 14).

Common Stock Buyback

The Company’s Board of Directors, under multiple authorizations, has authorized the repurchase of ~~the Company’s~~ common stock on the open market or through private transactions. The Company purchased ~~3,538,000~~3,683,000 shares at a total cost of ~~$188,276~~$209,383 during the ~~nine~~six months ended ~~September~~June 30,, ~~2017~~, 2022, which reduced the total shares outstanding of common stock. The cost of stock purchases during the period includes the cost of certain transactions that settled in the following quarter. ~~As of September 30, 2017,~~On June 1, 2022, the ~~Company had approximately $30,476 of authorization remaining for the purchase of common stock under the program. On October 24, 2017, the Company’s~~Company's Board of Directors approved an increase in the stock repurchase program by an additional ~~$200,000, increasing~~$200,000. As of June 30, 2022, the ~~available~~Company had approximately $221,910 of authorization ~~to approximately $230,476.~~remaining for the purchase of common stock under the program.

The Company immediately retires its common stock when purchased. Upon retirement, the Company reduces Capital in excess of par value for the average capital per share outstanding and the remainder is charged against Retained earnings. If th

~~17 of 42~~

ethe Company reduces its Retained earnings to zero, any subsequent purchases of common stock will be charged entirely to Capital in excess of par value.

Cash Dividend

On ~~May 24, 2017~~,June 1, 2022, the Board of Directors declared a cash dividend of ~~$0.28~~$0.40 per share on the Company's common stock, which was paid on June ~~16, 2017~~,22, 2022, to shareholders of record on June ~~7, 2017~~.13, 2022. Cash dividends declared during the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2022 and ~~2016~~2021 were ~~$44,264~~$54,378 and $52,389, respectively.

~~$42,001, respectively.~~

Note 9.8. Accumulated Other Comprehensive Loss

The components of Accumulated other comprehensive loss, net of tax, are as follows:


	Foreign Currency Translation Adjustments		Unrealized Gains (Losses) on Investments		Accumulated Other Comprehensive Loss
Balance, January 1, 2022	$	(19,781)	$	(62)	$	(19,843)

Other comprehensive loss before reclassifications	(19,181)		(7,057)		(26,238)
Amounts reclassified from accumulated other comprehensive loss	—		318		318
Net current-period other comprehensive loss	(19,181)		(6,739)		(25,920)

Balance, June 30, 2022	$	(38,962)	$	(6,801)	$	(45,763)

Foreign
Currency
Translation
Adjustments

Unrealized
Gains (Losses)
on Investments
Accumulated Other Comprehensive Loss
Balance, January 1, 2017 $ (37,119 ) $ (836 ) $ (37,955 )

Other comprehensive gain before reclassifications 17,028
435
17,463
Amounts reclassified from accumulated other comprehensive loss —
194
194
Net current-period other comprehensive gain 17,028
629
17,657

Balance, September 30, 2017 $ (20,091 ) $ (207 ) $ (20,298 )

Note ~~10.~~9. Business Segment Information

The Company’s reportable business segments are:

Private Banks – ~~provides~~Provides outsourced investment processing and investment management ~~programs~~platforms to banks and trust institutions, independent wealth advisers and financial advisors worldwide;

Investment Advisors – ~~provides~~Provides investment management ~~programs~~and investment processing platforms to affluent investors through a network of independent registered investment advisors, financial planners and other investment professionals in the United States;

Institutional Investors – ~~provides~~Provides OCIO solutions, including investment management ~~programs~~and administrative outsourcing platforms to retirement plan sponsors, healthcare systems, higher education and other not-for-profit organizations worldwide;

Investment Managers – ~~provides~~Provides investment operations outsourcing ~~solutions~~platforms to fund companies, banking institutions, ~~and both~~ traditional and non-traditional investment managers ~~worldwide;~~worldwide and family offices in the United States; and

Investments in New Businesses – ~~focuses~~Focuses on providing investment management ~~programs~~solutions to ultra-high-net-worth families residing in the United States; developing ~~internet-based investment services~~network and ~~advice solutions;~~data protection services; modularizing larger technology platforms into stand-alone components; entering new markets; and conducting other research and development activities.

The information in the following tables is derived from ~~the Company’s~~ internal financial reporting used for corporate management purposes. There are no inter-segment revenues for the three and ~~nine~~six months ended ~~September~~June 30, ~~2017~~2022 and ~~2016. Management evaluates Company assets on a consolidated basis during interim periods.~~2021. Assets are not allocated to segments for internal reporting purposes. The accounting policies of the reportable business segments are the same as those described in Note 1 to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2016~~.

~~The following tables highlight certain financial information about each of the Company’s business segments for the three months ended~~ ~~September 30, 2017~~ ~~and~~ ~~2016~~.2021.

Private
Banks

Investment
Advisors

Institutional
Investors

Investment
Managers

Investments
In New
Businesses
Total
For the Three Months Ended September 30, 2017
Revenues $ 118,499
$ 94,318
$ 80,411
$ 91,020
$ 1,770
$ 386,018
Expenses 115,806
50,585
40,003
59,831
5,063
271,288
Operating profit (loss) $ 2,693
$ 43,733
$ 40,408
$ 31,189
$ (3,293 ) $ 114,730

~~18 of 42~~

Private
Banks

Investment
Advisors

Institutional
Investors

Investment
Managers

Investments
In New
Businesses
Total
For the Three Months Ended September 30, 2016
Revenues $ 115,952
$ 85,258
$ 76,222
$ 75,672
$ 1,537
$ 354,641
Expenses 105,523
45,080
36,943
48,588
5,348
241,482
Operating profit (loss) $ 10,429
$ 40,178
$ 39,279
$ 27,084
$ (3,811 ) $ 113,159

~~A reconciliation of the total operating profit reported for the business segments to income from operations in the Consolidated Statements of Operations for the~~ ~~three months ended September 30~~, ~~2017~~ ~~and~~ ~~2016~~ ~~is as follows:~~

2017 2016
Total operating profit from segments $ 114,730
$ 113,159
Corporate overhead expenses (15,493 ) (15,941 )
Income from operations $ 99,237
$ 97,218

~~The following tables provide additional information for the~~ ~~three months ended September 30~~, ~~2017~~ ~~and~~ ~~2016~~ ~~pertaining to our business segments:~~

Capital Expenditures (1) Depreciation
2017 2016 2017 2016
Private Banks $ 14,671
$ 15,018
$ 4,374
$ 3,289
Investment Advisors 5,421
6,744
759
940
Institutional Investors 1,260
1,744
248
344
Investment Managers 3,450
6,210
1,197
1,228
Investments in New Businesses 173
379
162
549
Total from business segments $ 24,975
$ 30,095
$ 6,740
$ 6,350
Corporate overhead 377
1,111
208
226
$ 25,352
$ 31,206
$ 6,948
$ 6,576

~~(1) Capital expenditures include additions to property and equipment and capitalized software.~~

Amortization
2017 2016
Private Banks $ 9,125
$ 7,972
Investment Advisors 2,973
2,626
Institutional Investors 425
425
Investment Managers 1,132
275
Investments in New Businesses 40
40
Total from business segments $ 13,695
$ 11,338
Corporate overhead 50
50
$ 13,745
$ 11,388

The following tables highlight certain financial information about each of the ~~Company’s~~ business segments for the ~~nine~~three months ended ~~September~~June 30, ~~2017~~2022 and ~~2016.~~2021:


	Private Banks		Investment Advisors		Institutional Investors		Investment Managers		Investments In New Businesses		Total
	For the Three Months Ended June 30, 2022
Revenues	$	124,184	$	113,194	$	83,483	$	155,926	$	4,883	$	481,670
Expenses	121,060		63,375		43,925		100,807		12,844		342,011
Operating profit (loss)	$	3,124	$	49,819	$	39,558	$	55,119	$	(7,961)	$	139,659

Private
Banks

Investment
Advisors

Institutional
Investors

Investment
Managers

Investments
In New
Businesses
Total
For the Nine Months Ended September 30, 2017
Revenues $ 347,317
$ 275,302
$ 235,483
$ 255,123
$ 5,108
$ 1,118,333
Expenses 336,709
147,504
117,499
165,743
15,067
782,522
Operating profit (loss) $ 10,608
$ 127,798
$ 117,984
$ 89,380
$ (9,959 ) $ 335,811

~~19 of 42~~

Private
Banks

Investment
Advisors

Institutional
Investors

Investment
Managers

Investments
In New
Businesses
Total
For the Nine Months Ended September 30, 2016
Revenues $ 344,149
$ 243,820
$ 223,793
$ 216,528
$ 4,445
$ 1,032,735
Expenses 312,126
134,575
108,875
140,831
15,935
712,342
Operating profit (loss) $ 32,023
$ 109,245
$ 114,918
$ 75,697
$ (11,490 ) $ 320,393
Gain on sale of subsidiary 2,791
—
—
—
—
2,791
Segment profit (loss) $ 34,814
$ 109,245
$ 114,918
$ 75,697
$ (11,490 ) $ 323,184


	Private Banks		Investment Advisors		Institutional Investors		Investment Managers		Investments In New Businesses		Total
	For the Three Months Ended June 30, 2021
Revenues	$	123,676	$	119,396	$	85,699	$	142,808	$	4,072	$	475,651
Expenses	117,654		59,133		41,895		84,995		13,631		317,308
Operating profit (loss)	$	6,022	$	60,263	$	43,804	$	57,813	$	(9,559)	$	158,343

A reconciliation of the total operating profit reported for the business segments to income from operations in the Consolidated Statements of Operations for the ~~nine~~three months ended ~~September~~June 30, ~~2017~~2022 and ~~2016~~2021 is as follows:

2017 2016
Total operating profit from segments $ 335,811
$ 320,393
Corporate overhead expenses (45,830 ) (42,840 )
Income from operations $ 289,981
$ 277,553


	2022		2021
Total operating profit from segments	$	139,659	$	158,343
Corporate overhead expenses	(23,799)		(22,322)
Income from operations	$	115,860	$	136,021

The following tables provide additional information for the ~~nine~~three months ended ~~September~~June 30, ~~2017~~2022 and ~~2016~~2021 pertaining to ~~our~~the business segments:


	Capital Expenditures (1)				Depreciation					Capital Expenditures (1)				Depreciation
	2017		2016		2017		2016			2022		2021		2022		2021
Private Banks	$	37,000	$	32,184	$	12,956	$	9,669	Private Banks	$	8,541	$	8,594	$	5,554	$	4,178
Investment Advisors	13,651		12,863		2,294		2,880		Investment Advisors	3,423		3,580		469		1,417
Institutional Investors	3,157		3,236		719		1,017		Institutional Investors	1,028		884		285		353
Investment Managers	13,730		9,275		3,141		3,590		Investment Managers	4,113		3,373		1,755		2,027
Investments in New Businesses	432		594		701		1,644		Investments in New Businesses	208		313		44		100
Total from business segments	$	67,970	$	58,152	$	19,811	$	18,800	Total from business segments	$	17,313	$	16,744	$	8,107	$	8,075
Corporate Overhead	921		1,700		536		657
Corporate overhead									Corporate overhead	445		418		179		349
	$	68,891	$	59,852	$	20,347	$	19,457		$	17,758	$	17,162	$	8,286	$	8,424

(1) Capital expenditures include additions to property and equipment and capitalized software.


	Amortization
	2022		2021
Private Banks	$	8,261	$	8,633
Investment Advisors	3,158		2,909
Institutional Investors	2,257		427
Investment Managers	2,577		2,444
Investments in New Businesses	185		185
Total from business segments	$	16,438	$	14,598
Corporate overhead	70		125
	$	16,508	$	14,723

Amortization
2017 2016
Private Banks $ 26,464
$ 23,452
Investment Advisors 8,720
7,764
Institutional Investors 1,174
1,249
Investment Managers 1,623
816
Investments in New Businesses 200
106
Total from business segments $ 38,181
$ 33,387
Corporate Overhead 151
297
$ 38,332
$ 33,684

The following tables highlight certain financial information about each of business segment for the six months ended June 30, 2022 and 2021:


	Private Banks		Investment Advisors		Institutional Investors		Investment Managers		Investments In New Businesses		Total
	For the Six Months Ended June 30, 2022
Revenues	$	337,732	$	232,424	$	170,322	$	312,827	$	9,808	$	1,063,113
Expenses	243,015		127,895		89,283		199,644		24,794		684,631
Operating profit (loss)	$	94,717	$	104,529	$	81,039	$	113,183	$	(14,986)	$	378,482



	Private Banks		Investment Advisors		Institutional Investors		Investment Managers		Investments In New Businesses		Total
	For the Six Months Ended June 30, 2021
Revenues	$	241,284	$	232,690	$	170,198	$	279,227	$	7,938	$	931,337
Expenses	228,378		114,160		81,053		168,015		27,035		618,641
Operating profit (loss)	$	12,906	$	118,530	$	89,145	$	111,212	$	(19,097)	$	312,696

A reconciliation of the total operating profit reported for the business segments to income from operations in the Consolidated Statements of Operations for the six months ended June 30, 2022 and 2021:


	2022		2021
Total operating profit from segments	$	378,482	$	312,696
Corporate overhead expenses	(47,823)		(43,838)
Income from operations	$	330,659	$	268,858

The following tables provide additional information for the six months ended June 30, 2022 and 2021:


	Capital Expenditures (1)				Depreciation
	2022		2021		2022		2021
Private Banks	$	15,763	$	14,423	$	10,660	$	8,310
Investment Advisors	6,450		5,888		925		2,706
Institutional Investors	1,977		1,395		574		711
Investment Managers	8,137		5,004		3,775		4,080
Investments in New Businesses	413		452		88		246
Total from business segments	$	32,740	$	27,162	$	16,022	$	16,053
Corporate Overhead	890		578		362		680
	$	33,630	$	27,740	$	16,384	$	16,733

(1) Capital expenditures include additions to property and equipment and capitalized software.


	Amortization
	2022		2021
Private Banks	$	16,800	$	17,209
Investment Advisors	6,391		5,536
Institutional Investors	4,540		853
Investment Managers	5,153		4,924
Investments in New Businesses	370		370
Total from business segments	$	33,254	$	28,892
Corporate Overhead	141		183
	$	33,395	$	29,075

Note ~~11.~~10. Income Taxes

The gross liability for unrecognized tax benefits at ~~September~~June 30, ~~2017~~2022 and December 31, ~~2016~~2021 was ~~$16,038~~$16,861 and ~~$17,287~~,$14,887, respectively, exclusive of interest and penalties, of which ~~$13,386~~$16,358 and ~~$14,868~~$14,382 would affect the effective tax rate if the Company were to recognize the tax benefit.

The Company classifies interest and penalties on unrecognized tax benefits as income tax expense. As of ~~September~~June 30, ~~2017~~2022 and December 31, ~~2016~~,2021, the combined amount of accrued interest and penalties related to tax positions taken on tax returns was ~~$1,361~~$1,642 and ~~$1,224~~,$1,338, respectively.


	June 30, 2022		December 31, 2021
Gross liability for unrecognized tax benefits, exclusive of interest and penalties	$	16,861	$	14,887
Interest and penalties on unrecognized benefits	1,642		1,338
Total gross uncertain tax positions	$	18,503	$	16,225
Amount included in Current liabilities	$	4,533	$	4,253
Amount included in Other long-term liabilities	13,970		11,972
	$	18,503	$	16,225

~~20 of 42~~

September 30, 2017 December 31, 2016
Gross liability for unrecognized tax benefits, exclusive of interest and penalties $ 16,038
$ 17,287
Interest and penalties on unrecognized benefits 1,361
1,224
Total gross uncertain tax positions $ 17,399
$ 18,511
Amount included in Current liabilities $ 2,648
$ 3,866
Amount included in Other long-term liabilities 14,751
14,645
$ 17,399
$ 18,511

The ~~Company's~~ effective income tax rate for the three and ~~nine~~six months ended ~~September~~June 30, ~~2017~~2022 and ~~2016~~2021 differs from the federal income tax statutory rate due to the following:

Three Months Ended September 30, Nine Months Ended September 30,
2017 2016 2017 2016
Statutory rate 35.0 % 35.0 % 35.0 % 35.0 %
State taxes, net of federal tax benefit 1.7
1.2
1.7
1.5
Foreign tax expense and tax rate differential (1.0 ) (0.8 ) (1.0 ) (0.8 )
Tax benefit from stock option exercises (4.5 ) —
(3.9 ) —
Expiration of the statute of limitations (2.6 ) (0.8 ) (0.9 ) (0.3 )
Other, net (0.9 ) (0.8 ) (0.7 ) (0.7 )
27.7 % 33.8 % 30.2 % 34.7 %


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Statutory rate	21.0	%	21.0	%	21.0	%	21.0	%
State taxes, net of federal tax benefit	2.8		3.2		2.8		3.2
Foreign tax expense and tax rate differential	(0.1)		(0.1)		(0.1)		(0.1)
Tax benefit from stock option exercises	(0.3)		(1.2)		(0.3)		(1.2)



Other, net	(0.3)		(0.6)		(0.3)		(0.4)
	23.1	%	22.3	%	23.1	%	22.5	%

The ~~decrease~~increase in the Company's effective tax ~~rates~~rate for the three and ~~nine~~six months ended ~~September~~June 30, ~~2017~~2022 was primarily due to decreased tax benefits related to the ~~adoption of ASU 2016-09. Under this standard, the tax effects~~lower volume of stock option exercises ~~are treated as discrete items~~ in the reporting period in which they occur. Therefore, the tax effect of stock option exercises is not spread over the entire year through the use of the annual effective tax rate, but instead is recorded entirely in the period in which the tax deduction arose. Accordingly, the Company recorded the income tax benefit as a discrete item in income for the three and nine months ended September 30, 2017. The Company's effective tax rate could fluctuate significantly on a quarterly basis due2022 compared to the ~~tax effects of stock-based compensation.~~prior year period. The increase was offset by a decrease in ~~the~~state tax ~~rates for the three and nine months ended September 30, 2017 was also due to the expiring statute of limitations pertaining to various federal tax items.~~expense.

The Company files income tax returns in the United States on a consolidated basis and in many U.S. state and foreign jurisdictions. The Company is subject to examination of income tax returns by the Internal Revenue Service (IRS) and other domestic and foreign tax authorities. The Company is no longer subject to U.S. federal income tax examination for years before ~~2014~~2018 and is no longer subject to state, local or foreign income tax examinations by authorities for years before ~~2010.~~2015.

The Company estimates it will recognize ~~$2,648~~$4,533 of gross unrecognized tax benefits. This amount is expected to be paid within one year or to be removed at the expiration of the statute of limitations and resolution of income tax audits and is netted against the current payable account. These unrecognized tax benefits are related to tax positions taken on certain federal, state, and foreign tax returns. However, the timing of the resolution of income tax examinations is highly uncertain, and the amounts ultimately paid, if any, upon resolution of the issues raised by the taxing authorities may differ materially from the amounts accrued for each year. While it is reasonably possible that some issues under examination could be resolved in the next twelve months, based upon the current facts and circumstances, the Company cannot reasonably estimate the timing of such resolution or the total range of potential changes as it relates to the current unrecognized tax benefits that are recorded as part of the Company’s financial statements.

On July 8, 2022, House Bill 1342 was signed into law in the Commonwealth of Pennsylvania, making significant changes to the corporate income tax rate. The bill reduces the corporate income tax rate from 9.99% to 4.99% with reductions occurring in phases beginning each tax year from January 1, 2023 through January 1, 2031. U.S. GAAP requires companies to recognize the effect of tax law changes in the period of enactment. Management is still evaluating the impact of this rate change but does not expect it to be material.

Note ~~12.~~11. Commitments and Contingencies

In the ~~normal~~ordinary course of business, the Company isfrom time to time enters into contracts containing indemnification obligations of the Company. These obligations may require the Company to make payments to another party upon the occurrence of certain events including the failure by the Company to ~~various claims~~meet its performance obligations under the contract. These contractual indemnification provisions are often standard contractual terms of the nature customarily found in the type of contracts entered into by the Company. In many cases, there are no stated or notional amounts included in the indemnification provisions. There are no amounts reflected on the Consolidated Balance Sheets as of June 30, 2022 and ~~legal proceedings.~~December 31, 2021 related to these indemnifications.

~~SEI~~Stanford Trust Company Litigation

There has been ~~named in seven lawsuits filed in Louisiana courts; four of the cases also name SPTC as a defendant. The underlying allegations in all actions relate~~no material change to the purported role of SPTC in providing back-office services to Stanford Trust Company. The complaints allege that SEI and SPTC participated in some manner in the sale of “certificates of deposit” issued by Stanford International Bank so as to be a “seller” of the certificates of deposit for purposes of primary liability under the Louisiana Securities Law or so as to be secondarily liable under that statute for sales of certificates of deposit made by Stanford Trust Company. Two of the actions also include claims for violations of the Louisiana Racketeering Act and possibly conspiracy, and a third also asserts claims of negligence, breach of contract, breach of fiduciary duty, violations of the uniform fiduciaries law, negligent misrepresentation, detrimental reliance, violations of the Louisiana Racketeering Act, and conspiracy.

~~21 of 42~~

~~The procedural~~ status of the ~~seven cases varies. The~~ ~~Lillie~~ ~~case, filed originally~~litigations related to the Stanford Trust Company matters or the Company’s expectations with respect to such matters as previously reported in the ~~19th Judicial District Court for~~Company’s quarterly report on Form 10-Q as filed with the ~~Parish of East Baton Rouge, was brought as~~Commission on April 25, 2022.

SS&C Advent Litigation

On February 28, 2020, SEI Global Services, Inc. (SGSI), a ~~class action and is procedurally the most advanced~~wholly-owned subsidiary of the ~~cases. SEI and SPTC~~Company, filed ~~exceptions, which the Court granted~~a complaint under seal in part, dismissing claims under the Louisiana Unfair Trade Practices Act and permitting the claims under the Louisiana Securities Law to go forward. On March 11, 2013, newly-added insurance carrier defendants removed the case to the United States District Court for the ~~Middle~~Eastern District of ~~Louisiana. On August 7, 2013,~~Pennsylvania against SS&C Advent (Advent) and SS&C Technologies Holdings, Inc. (SS&C) alleging that SS&C and Advent breached the ~~Judicial Panel on Multidistrict Litigation transferred the matter to the Northern District of Texas where MDL 2099,~~ ~~In re: Stanford Entities Securities Litigation~~ ~~(“the Stanford MDL”), is pending. On September 22, 2015, the District Court on the motion of SEI and SPTC dismissed plaintiffs’ claims for primary liability under Section 714(A)~~terms of the ~~Louisiana Securities Law, but declined~~contract between the parties and asking the Court to ~~dismiss plaintiffs’ claims~~hold SS&C and Advent to their bargained-for obligations (the Advent Matter). In addition to Breach of Contract, the complaint also includes counts for ~~secondary liability under Section 714(B)~~Declaratory Judgment, Tortious Interference with Existing and Prospective Contractual Relations, Violation of the ~~Louisiana Securities~~New York General Business Law ~~based on~~Section 349, Violations of Section 2 of the ~~allegations pled by plaintiffs. On November 4, 2015,~~Sherman Antitrust Act, Promissory Estoppel and Breach of the ~~District Court granted SEI~~Covenant of Good Faith and ~~SPTC's~~Fair Dealing. SGSI seeks various forms of relief, including declaratory judgment, specific performance under the contract, and monetary damages, including punitive damages, treble damages and attorney’s fees.

Following various procedural actions, including an amendment of SGSI’s complaint to include additional breach of contract claims, Advent filed a motion to dismiss ~~plaintiffs' claims under Section 712(D) of the Louisiana Securities Law. Consequently, the only claims of plaintiffs still pending before the District Court in~~ ~~Lillie~~ ~~are plaintiffs' claims for secondary liability against SEI and SPTC under Section 714(B) of the Louisiana Securities Law.~~ SGSI’s complaint.

On May 2, 2016, the District Court certified the class as being "all persons for whom Stanford Trust Company purchased or renewed Stanford Investment Bank Limited certificates of deposit in Louisiana between January 1, 2007 and February 13, 2009". Notice of the pendency of the class action was mailed to potential class members on October ~~4, 2016.~~

~~On December 1, 2016, a group of plaintiffs who opted out of the~~ ~~Lillie~~ ~~class filed a complaint against SEI and SPTC in the United States District Court in the Middle District of Louisiana, alleging claims essentially the same as those in~~ ~~Lillie~~. In January 2017, the Judicial Panel on Multidistrict Litigation transferred the proceeding to the Northern District of Texas and the Stanford MDL. During February 2017, SEI filed its response to the Complaint and in March 2017 the District Court for the Northern District of Texas approved the stipulated dismissal of all claims in this complaint predicated on Section 712(D) or Section 714(A) of the Louisiana Securities Law.

Another one of the cases, filed in the 23rd Judicial District Court for the Parish of Ascension, also was removed to federal court and transferred by the Judicial Panel on Multidistrict Litigation to the Northern District of Texas and the Stanford MDL. The schedule for responding to that Complaint has not yet been established.

~~The plaintiffs in two of the cases remaining in the Parish of East Baton Rouge have granted SEI and SPTC indefinite extensions to respond to the petitions.~~

~~In the two additional cases, filed in East Baton Rouge and brought by the same counsel who filed the~~ ~~Lillie~~ action, virtually all of the litigation to date has involved motions practice and appellate litigation regarding the existence of federal subjection matter jurisdiction under the federal Securities Litigation Uniform Standards Act (SLUSA). After the matter was removed to23, 2020, the United States District Court for the ~~Northern~~Eastern District of ~~Texas,~~Pennsylvania dismissed SEI’s federal antitrust claims and declined to rule on the state law claims on the basis that in the absence of the anti-trust claim, the court ~~dismissed~~had no jurisdiction over the ~~action under SLUSA. The~~state law claims. SGSI has appealed the dismissal of the federal anti-trust claims to the Third Circuit Court of Appeals. On June 30, 2022, the Third Circuit Court of Appeals issued an order denying SGSI’s appeal of the District Court’s ruling.

Since October 23, 2020, Advent and SGSI have been litigating the remaining breach of contract, breach of the implied duty of good faith and fair dealing, and tortious interference with contract claims in New York State Court. Additionally, SGSI made motions for injunctive relief to insure that Advent provided SGSI with access to the ~~Fifth Circuit reversed that order,~~Geneva, Moxy and APX software modules as SGSI believes is required pursuant to the terms of a valid contract. On January 13, 2021, Judge Borrok of the Supreme Court of the ~~United States~~State of New York, granted SGSI’s motion for injunctive relief and issued an Order in which he characterized the basis for Advent’s claim for breach of contract as appearing to be “pre-textual” and found that SGSI’s claims for breach of contract would likely succeed on the merits. Judge Borrok granted SGSI’s motion for injunctive relief, on a preliminary basis, and precluded SS&C Advent from:

•Dishonoring their contractual obligations and commitments under the SLSA, including, denying SEI’s licenses, rights, and privileges under the SLSA;

• Failing to provide new license keys for the license keys due to Geneva, Moxy, and APX, and other software products licensed by SEI pursuant to the SLSA (such new license keys to be provided no later than January 15, 2021 at 10 A.M.);

• Denying to SEI any and all access to the Geneva, Moxy, and APX software and related modules as are reasonably necessary to provide access to such software to SEI’s clients; and

• Denying to SEI any and all support, maintenance and technical support services for Geneva, Moxy, and APX.

Pursuant to the Court's injunction order, SS&C Advent provided SEI with the necessary access to the Geneva, Moxy and APX software modules on January 14, 2021. These were tested, verified and are now running in the SEI production environment.

On January 15, 2021, SS&C Advent appealed Judge Borrok’s order granting SEI’s motion for preliminary injunctive relief to the Appellate Division of the Supreme Court of the State of New York, First Department. The Appellate Division unanimously affirmed the ~~Court~~injunction order on June 15, 2021.

On March 1, 2021, SS&C Advent moved to dismiss SGSI’s breach of ~~Appeals judgment on February 26, 2014. The matter was remanded to state court~~contract and ~~no material activity has taken place since that date.~~tortious interference with contract counter claims. These counter-claims were:

~~While~~

1.breach of contract;

2.declaratory judgment;

3.tortious interference with existing and prospective contractual relations;

4.deceptive trade practices in violation of New York Statutes;

5.breach of the ~~outcome~~covenant of ~~this~~good faith and fair dealing; and

6.promissory estoppel.

The parties agreed to toll the litigation ~~remains uncertain, SEI~~while endeavoring to resolve their dispute through a settlement mediation process moderated by Judge Borrok. The parties were unable to reach an agreement as to a settlement of the litigation and ~~SPTC believe that they have valid defenses to plaintiffs' claims and intend to defend the lawsuits vigorously. Because of uncertainty~~reengaged in the ~~make-up~~litigation process.

On October 5, 2021, Judge Borrok issued an order partially denying and partially granting SS&C Advent’s motion to dismiss SGSI’s breach of contract and tortious interference with contract counter claims.

Judge Borrok dismissed the third claim with respect to prospective contractual relationships only, as well as the fourth claim and the sixth claim. The remaining claims directed to proceed were:

1.breach of contract;

2.declaratory judgment;

3.tortious interference with existing a contractual relations; and

4.breach of the ~~Lillie~~ ~~class, the specific theories~~covenant of ~~liability that may survive~~good faith and fair dealing.

On December 1, 2021, SGSI filed a motion for partial summary judgment in the New York state court action. This motion applies to Count I of SS&C Advent’s complaint (SS&C Advent’s request for a declaratory judgment that its termination of the SGSI license agreements was proper); and Counts I and II of SGSI’s counterclaims (SGSI’s request for a declaratory judgment that SS&C Advent’s termination of the contract was improper because the licenses are perpetual unless SGSI chooses to not renew them or breaches the terms). SS&C Advent filed a cross-motion for summary judgment for a declaration that it was entitled to not renew SGSI's contracts. It also argued that if SGSI prevailed on its breach of contract claims, then its breach of implied duty of good faith and fair dealing claim must be dismissed in turn.

On December 31, 2021, SGSI received the license key for another year of access to the product. This ensures SGSI access to Advent and Moxy through January 31, 2023.

On April 15, 2022, Judge Borrok held a hearing on SGSI’s motion for partial summary judgement and issued an order on the same day granting SGSI's motion in its entirety and denying SS&C Advent's cross motion. Specifically, the Court:

1.Rejected SS&C Advent's argument that the license is not perpetual;

2.Determined that SS&C Advent's purported termination was "pretextual" and breached the parties' contract;

3.Determined that SS&C Advent's attempt to not renew breached the parties' contracts because "Advent did not have the right not to renew," after dismissing SS&C Advent's argument that it shared the same nonrenewal rights as SGSI as a "false narrative;" and

4.Rejected SS&C Advent's second attempt to dismiss SGSI's breach of implied duty of good faith and fair dealing claim.

SEI continues to believe that it will not have to change providers under the current terms of its contract with SS&C Advent and that the process of litigating its rights under this contract may be a multi-year process.

SEI believes SGSI has a strong basis for proving the actions it alleges in the Advent Matter and looks forward to the opportunity to pursue its remaining tort and breach of implied covenant and good faith and fair dealing claims continue to assert all of its rights in tort and under the contract and prove the damages that it has suffered as a consequence of the behavior by SS&C Advent that SGSI alleges. SEI expects the financial impact of litigating the Advent Matter to be immaterial.

Other Matters

The Company and certain of its subsidiaries are party to various other ~~dispositive motion,~~examinations, investigations, actions and claims arising in the ~~relative lack~~normal course of ~~discovery regarding damages, causation, mitigation and other aspects~~business that ~~may ultimately bear upon loss,~~ the Company isdoes not ~~reasonably able~~believe are material. The Company believes that the ultimate resolution of these matters will not have a material adverse effect on the Company's financial position or the manner in which the Company conducts its business. Currently, the Company does not believe the amount of losses associated with these matters can be estimated. While the Company does not believe that the amount of such losses will, when liquidated or estimable, be material to ~~provide an estimate~~its financial position, the assumptions may be incorrect and any such loss could have a material adverse effect on the Company's results of ~~loss, if any, with respect to~~operations or the ~~foregoing lawsuits.~~

On November 26, 2014, a Writ of Summons was issued to two of our subsidiaries, SEI Investments - Global Fund Services Limited (GFSL) and SEI Investments - Depositary & Custodial Services (Ireland) Limited (D&C), to appear beforemanner in which the Court of First Instance Antwerp, Belgium. The plaintiffs in this case allege that through their initial investments in collective investment funds domiciled in Netherlands and subsequent transfer of claim rights to a Belgium domiciled partnership, they are beneficial owners of a portfolio of life settlement policies (the Portfolio) which lapsed due to a failure to make premium payments. The plaintiffs seek to recover jointly and severally from nine defendants including GFSL and D&C, damages of approximately $84 million. GFSL and D&C’s involvementCompany conducts its business in the ~~litigation appears to arise out of their historical provision of administration~~period(s) during which the underlying matters are resolved.

Note 12. Goodwill and ~~custody services, respectively, to~~Intangible Assets

The changes in the Strategic Life Settlement Fund PLC, who, together with its managers, appear to be the principal defendants in this claim. On December 4, 2015, the Belgium court dismissed plaintiff's claims for a lack of jurisdiction. On December 22, 2015, the plaintiffs appealed the dismissal. During October 2017, the Belgium appellate court dismissed plaintiff's appeal.

While the outcome of this action is uncertain given its early phase and the lack of specific theories of liability asserted against GFSL and D&C, each of GFSL and D&C believe that they have valid defenses to plaintiffs’ claims and intend to defend the lawsuit vigorously, and GFSL and D&C are not reasonably able to provide an estimatecarrying amount of the ~~ultimate loss, if any, with respect to this lawsuit.~~Company's goodwill by segment are as follows:


	Institutional Investors		Investment Managers		Investments in New Businesses		Total

Balance, December 31, 2021	$	48,911	$	56,822	$	11,499	$	117,232
Measurement period adjustments	(11)		211		—		200
Foreign currency translation adjustments	—		(27)		—		(27)
Balance, June 30, 2022	$	48,900	$	57,006	$	11,499	$	117,405

~~22 of 42~~

~~Note 13. Sale of SEI Asset Korea~~

On July 31, 2012, the Company, MetLife International Holdings, Inc. (MetLife) and International Finance Corporation (IFC) entered into a definitive agreement with Baring Asset Management Limited (Barings) to sell all ownership interest in SEI Asset Korea (SEI AK). SEI AK was located in South Korea and provided domestic equity and fixed-income investment management services to financial institutions and pension funds.

On ~~March 28, 2013~~, all conditions subject to closing the transaction were satisfied and all ownership interests in SEI AK were transferred to Barings. Under the terms of the agreement, a portion of the purchase price was paid upon closing with up to an additional ~~$11,220~~ payable to the Company as a contingent purchase price with respect to three one-year periods ending on December 31, 2013, 2014, and 2015 depending upon whether SEI AK achieves specified revenue measures during such periods. The Company recognized a pre-tax gain of $2,791, or $0.01 diluted earnings per share, during the nine months ended September 30, 2016 representing the final annual payment under the terms of the agreement. The Company's gain from the sale of SEI AK are included in Gain on sale of subsidiary on the accompanying Consolidated Statement of Operations.

~~Note 14. Business Acquisition~~

~~On July 3, 2017,~~In October 2021, the Company acquired all ownership interests of ~~Archway Technology~~Finomial Corporation (Finomial). The excess purchase price over the estimated value of the net tangible and identifiable intangible assets was allocated to goodwill. The total amount of goodwill from this transaction amounted to $4,036 and is included in the accompanying Consolidated Balance Sheets.

In November 2021, the Company acquired all ownership interests of Novus Partners ~~LLC, Archway Finance & Operations, Inc.~~(Novus). The excess purchase price over the estimated value of the net tangible and ~~Keystone Capital Holdings, LLC (collectively, Archway), a provider~~identifiable intangible assets was allocated to goodwill. The total amount of ~~operating technologies~~goodwill from this transaction amounted to $48,911 and ~~services~~is included in the accompanying Consolidated Balance Sheets.

In addition to the ~~family office industry, from Keystone International Holdings, Inc. With this acquisition,~~intangible assets acquired through the acquisitions of Finomial and Novus, during 2021, the Company ~~expands its position~~also acquired intangible assets through the purchase of a technology platform providing digital collaboration tools for financial advisors and the purchase of the Atlas Master Trust, a defined contribution master trust in the ~~single and multi-family office services market by diversifying its technology and operating solutions.~~United Kingdom.

~~Under~~In April 2018, the ~~acquisition method~~Company acquired all ownership interests of ~~accounting, the~~Huntington Steele, LLC (Huntington Steele). The total purchase price was ~~preliminarily~~ allocated to ~~Archway's~~Huntington Steele’s net tangible and intangible assets based upon their estimated fair values at the date of purchase. The excess purchase price over the value of the identifiable intangible assets was recorded as goodwill. The total amount of ~~July 3, 2017.~~goodwill from this transaction amounted to $11,499 and is included on the accompanying Consolidated Balance Sheets. The total purchase price for ~~Archway was $81,532 in cash consideration with up to an additional $8,000 payable to the seller as~~Huntington Steele included a contingent purchase price ~~with respect~~payable to ~~two one-year periods ending December 31, 2017 and 2018 depending~~the sellers upon ~~whether Archway achieves~~the attainment of specified financial measures determined at various intervals occurring between 2019 and 2023. The Company made payments of $868 and $3,965 during ~~such periods. The total purchase price was preliminarily allocated~~the six months ended June 30, 2022 and 2021, respectively, to ~~intangible assets for $83,120, net assets acquired for $3,212 and~~the sellers. As of June 30, 2022, the remaining amount of the contingent consideration ~~for $4,800. The fair values assigned to assets acquired and~~of $9,166 is included in Accrued liabilities ~~assumed are based~~ on ~~management’s best estimates and assumptions as of~~ the ~~reporting date and are considered preliminary pending finalization of valuation analyses pertaining to the intangible assets acquired and the contingent consideration.~~accompanying Balance Sheet.

The Company ~~acquired $1,401 in cash during the acquisition, resulting in $80,131 net cash paid for Archway. According to the terms~~recognized $6,496 and $2,117 of the purchase agreement, a portion of the purchase price was placed into escrow to indemnify the Company of any pre-acquisition damages. As of September 30, 2017, the balance available in escrow was $8,000.

The results of operations of Archway are included in the Investment Managers business segment and are reflected in the Company's Consolidated Statements of Operations since the completion of the acquisition on July 3, 2017.

~~All tangible and intangible assets resulting from the Archway transaction have been allocated to the Investment Managers business segment. Amortization~~amortization expense related to the intangible assets acquired ~~was $857~~through acquisitions during the ~~period~~six months ended ~~September~~June 30, ~~2017. Any goodwill generated~~2022 and 2021, respectively.

Note 13. Revenues from Contracts with Customers

The Company’s principal sources of revenues are: (1) asset management, administration and distribution fees primarily earned based upon a contractual percentage of net assets under management or administration; and (2) information processing and software servicing fees that are either recurring and primarily earned based upon the ~~acquisition is fully deductible for income tax purposes.~~

~~Pro forma information has not been presented because the effect~~number of trust accounts being serviced or a percentage of the ~~Archway acquisition~~market value of the clients' assets processed on the Company's platforms, or non-recurring and based upon project-oriented contractual agreements related to client implementations.

Disaggregation of Revenue

The following tables provide additional information pertaining to our revenues disaggregated by major product line and primary geographic market based on the location of the use of the products or services for each of the business segments for the three months ended June 30, 2022 and 2021:


	Private Banks		Investment Advisors		Institutional Investors		Investment Managers		Investments In New Businesses		Total
Major Product Lines:	For the Three Months Ended June 30, 2022
Investment management fees from pooled investment products	$	31,993	$	67,490	$	15,700	$	123	$	402	$	115,708
Investment management fees from investment management agreements	616		40,398		63,212		—		4,073		108,299
Investment operations fees	344		—		—		144,742		—		145,086
Investment processing fees - PaaS	56,378		—		—		—		—		56,378
Investment processing fees - SaaS	29,845		—		3,021		3,911		—		36,777
Professional services fees	4,096		—		—		635		—		4,731
Account fees and other	912		5,306		1,550		6,515		408		14,691
Total revenues	$	124,184	$	113,194	$	83,483	$	155,926	$	4,883	$	481,670

Primary Geographic Markets:
United States	$	96,115	$	113,194	$	68,702	$	142,350	$	4,883	$	425,244
United Kingdom	13,036		—		11,283		—		—		24,319
Canada	11,023		—		1,424		—		—		12,447
Ireland	4,010		—		1,963		9,416		—		15,389
Luxembourg	—		—		—		4,160		—		4,160
Other	—		—		111		—		—		111
Total revenues	$	124,184	$	113,194	$	83,483	$	155,926	$	4,883	$	481,670


	Private Banks		Investment Advisors		Institutional Investors		Investment Managers		Investments In New Businesses		Total
Major Product Lines:	For the Three Months Ended June 30, 2021
Investment management fees from pooled investment products	$	33,708	$	75,039	$	13,638	$	14	$	326	$	122,725
Investment management fees from investment management agreements	603		38,345		71,342		—		3,561		113,851
Investment operations fees	402		—		—		132,262		—		132,664
Investment processing fees - PaaS	55,746		—		—		—		—		55,746
Investment processing fees - SaaS	28,442		—		—		3,855		—		32,297
Professional services fees	3,928		—		—		867		—		4,795
Account fees and other	847		6,012		719		5,810		185		13,573
Total revenues	$	123,676	$	119,396	$	85,699	$	142,808	$	4,072	$	475,651

Primary Geographic Markets:
United States	$	78,848	$	119,396	$	67,792	$	132,648	$	4,072	$	402,756
United Kingdom	28,082		—		14,035		—		—		42,117
Canada	12,152		—		1,198		—		—		13,350
Ireland	4,594		—		2,546		10,160		—		17,300
Other	—		—		128		—		—		128
Total revenues	$	123,676	$	119,396	$	85,699	$	142,808	$	4,072	$	475,651

The following tables provide additional information pertaining to our revenues disaggregated by major product line and primary geographic market based on the location of the use of the products or services for each of the Company’s business segments for the six months ended June 30, 2022 and 2021:


	Private Banks		Investment Advisors		Institutional Investors		Investment Managers		Investments In New Businesses		Total
Major Product Lines:	For the Six Months Ended June 30, 2022
Investment management fees from pooled investment products	$	65,111	$	139,483	$	29,566	$	207	$	769	$	235,136
Investment management fees from investment management agreements	871		82,406		131,672		—		8,199		223,148
Investment operations fees	704		—		—		290,121		—		290,825
Investment processing fees - PaaS	112,833		—		—		—		—		112,833
Investment processing fees - SaaS	59,404		—		6,131		7,569		—		73,104
Professional services fees (1)	96,825		—		—		1,024		—		97,849
Account fees and other	1,984		10,535		2,953		13,906		840		30,218
Total revenues	$	337,732	$	232,424	$	170,322	$	312,827	$	9,808	$	1,063,113

Primary Geographic Markets:
United States	$	177,001	$	232,424	$	139,265	$	286,375	$	9,808	$	844,873
United Kingdom	129,699		—		24,032		—		—		153,731
Canada	22,823		—		2,666		—		—		25,489
Ireland	8,209		—		4,130		19,238		—		31,577
Luxembourg	—		—		—		7,214		—		7,214
Other	—		—		229		—		—		229
Total revenues	$	337,732	$	232,424	$	170,322	$	312,827	$	9,808	$	1,063,113

(1) Professional services fees of the Private Banks segment includes one-time early termination fees of $88,000 related to a contractual agreement with a significant client of the Company. In accordance with Accounting Standards Codification 606, the entire amount of the fees received were recorded during the three months ended March 31, 2022 as there were no future performance obligations of the Company related to the agreement upon termination.


	Private Banks		Investment Advisors		Institutional Investors		Investment Managers		Investments In New Businesses		Total
Major Product Lines:	For the Six Months Ended June 30, 2021
Investment management fees from pooled investment products	$	66,272	$	147,693	$	27,726	$	73	$	655	$	242,419
Investment management fees from investment management agreements	1,076		73,059		141,285		—		6,947		222,367
Investment operations fees	771		—		—		257,423		—		258,194
Investment processing fees - PaaS	106,622		—		—		—		—		106,622
Investment processing fees - SaaS	56,252		—		—		7,561		—		63,813
Professional services fees	8,335		—		—		2,014		—		10,349
Account fees and other	1,956		11,938		1,187		12,156		336		27,573
Total revenues	$	241,284	$	232,690	$	170,198	$	279,227	$	7,938	$	931,337

Primary Geographic Markets:
United States	$	153,943	$	232,690	$	134,512	$	259,664	$	7,938	$	788,747
United Kingdom	54,747		—		27,764		—		—		82,511
Canada	23,634		—		2,500		—		—		26,134
Ireland	8,960		—		5,165		19,563		—		33,688
Other	—		—		257		—		—		257
Total revenues	$	241,284	$	232,690	$	170,198	$	279,227	$	7,938	$	931,337

Investment management fees from pooled investment products - Revenues associated with clients' assets invested in Company-sponsored pooled investment products. Contractual fees are stated as a percentage of the market value of assets under management and collected on a monthly basis. Revenues are recognized in Asset management, administration and distribution fees on the accompanying Consolidated Statements of Operations.

Investment management fees from investment management agreements - Revenues based on assets of clients of the Institutional Investors segment primarily invested in Company-sponsored products. Each client is ~~not material~~charged an investment management fee that is stated as a percentage of the market value of all assets under management. The client is billed directly on a quarterly basis. Revenues are recognized in Asset management, administration and distribution fees on the accompanying Consolidated Statements of Operations.

Revenues associated with the separately managed account program offered through registered investment advisors located throughout the United States. The contractual fee is stated as a percentage of the market value of all assets invested in the separately managed account and collected on a quarterly basis. Revenues are recognized in Asset management, administration and distribution fees on the accompanying Consolidated Statements of Operations.

Investment operations fees - Revenues earned from accounting and administrative services, distribution support services and regulatory and compliance services to investment management firms and family offices. The Company contracts directly with the investment management firm or family office. The contractual fees are stated as a percentage of net assets under administration and billed when asset valuations are finalized. Revenues are recognized in Asset management, administration and distribution fees on the accompanying Consolidated Statements of Operations.

Investment processing fees - Platform as a Service - Revenues associated with clients that outsource their entire investment operation and back-office processing functions. Through the use of the Company's proprietary platforms, the Company assumes all back-office investment processing services including investment processing, custody and safekeeping of assets, income collections, securities settlement and other related trust activities. The contractual fee is based on a monthly fee plus additional fees determined on a per-account or per-transaction basis. Contractual fees can also be stated as a percentage of the value of assets processed on the Company's platforms each month as long as the fee is in excess of a monthly contractual minimum. The client is billed directly on a monthly basis. Revenues are recognized in Information processing and software servicing fees on the accompanying Consolidated Statements of Operations.

Investment processing fees - Software as a Service - Revenues associated with clients that outsource investment processing technology software and computer processing by accessing the Company's proprietary software and data center remotely but retain responsibility for all investment operations, client administration and other back-office trust operations. The contractual fee is based on a monthly fee plus additional fees determined on a per-account or per-transaction basis. The client is billed directly on a monthly basis.

Revenues associated with portfolio intelligence and workflow solutions offered to clients of the Institutional Investors segment and revenues associated with technology and outsourced services that support the accounting, investment management, and reporting functions for family offices and their service providers offered to clients of the Investment Managers segment. The contractual fee is primarily based on an annual fixed fee for software licenses and data management services. The client is billed in advance with various billing terms. Revenue recorded in advance of the performance of services is deferred and recognized when earned. Revenues are recognized in Information processing and software servicing fees on the accompanying Consolidated Statements of Operations.

Professional servicesfees - Revenues associated with the business services migration for investment processing clients of the Private Banks segment and investment operations clients of the Investment Managers segment. In addition, Professional services include other services such as business transformation consulting. Typically, fees are stated as a contractual fixed fee. The client is billed directly and fees are collected according to the terms of the agreement.

Account fees and other - Revenues associated with custody account servicing, account terminations, reimbursements received for out-of-pocket expenses, and other fees for the provision of ancillary services.

Note 14. Voluntary Separation Program

The Company initiated a Voluntary Separation Program (VSP) in June 2022. The VSP is a program designed to enhance talent attraction and development to drive future growth. The VSP was offered to long-tenured employees as part of its commitment to professional development and expanded responsibilities for current and new employees by increasing advancement opportunities.

The VSP was made available to employees in the United States who met the long-term tenure requirements and includes a severance package and the continuation of certain benefits based upon years of service. The severance package also includes allowances related to the vesting of certain stock option awards during the remainder of 2022 and the period in which the employee may exercise vested stock options after the termination of employment. These allowances will be considered modifications to the Company's ~~consolidated financial results.~~equity compensation plans.

Separation agreements with employees who are accepted to participate in the VSP are expected to be completed in July 2022. The vast majority of the accepted employees are anticipated to finish their employment before the end of 2022. The expected departure dates for participating employees may be adjusted based on management’s determination of how best to ensure a smooth and successful transition of responsibilities. The Company expects a one-time increase between $54,000 and $58,000 in personnel costs associated with the VSP during the third quarter 2022.

~~23 of 42~~

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

(In thousands, except asset balances and per share data)

This discussion reviews and analyzes the consolidated financial condition, the consolidated results of operations and other key factors that may affect future performance. This discussion should be read in conjunction with the Consolidated Financial Statements, the Notes to the Consolidated Financial Statements and the Annual Report on Form 10-K for the year ended December 31, ~~2016~~2021.

Overview

Consolidated Summary

~~We are~~SEI is a leading global provider of ~~investment processing,~~technology-driven wealth and investment management solutions. We deliver comprehensive platforms, services and infrastructure–encompassing technology, operational, and investment ~~operations solutions. We~~management services–to help ~~corporations, financial institutions,~~wealth managers, financial advisors, investment managers, family offices, institutional and ~~ultra-high-net-worth families~~private investors create and manage ~~wealth by providing comprehensive, innovative, investment and investment-business solutions.~~wealth. Investment processing fees are earned as either monthly fees for contracted services ~~including computer processing services, software licenses and investment operations services,~~or as ~~well as transaction-based fees for providing securities valuation and trade-execution.~~a percentage of the market value of our clients' assets processed on our platforms. Investment operations and investment management fees are earned as a percentage of ~~average~~ assets under management, administration or advised assets. As of ~~September~~June 30, ~~2017~~,2022, through our subsidiaries and partnerships in which we have a significant interest, we manage, advise or administer ~~$845.2 billion~~$1.3 trillion in hedge, private equity, mutual fund and pooled or separately managed assets, including ~~$325.0~~$403.6 billion in assets under management and ~~$515.6~~$889.0 billion in client assets under administration. Our affiliate, LSV Asset Management (LSV), manages ~~$101.9~~$81.9 billion of assets which are included as assets under management.

~~Our~~ Condensed Consolidated Statements of Operations for the three and ~~nine~~six months ended ~~September~~June 30, ~~2017~~2022 and ~~2016~~2021 were:


	Three Months Ended September 30,				Percent Change*		Nine Months Ended September 30,							Percent Change*			Three Months Ended June 30,									Percent Change*				Six Months Ended June 30,								Percent Change*
	2017		2016			2017				2016					2022						2021								2022				2021
Revenues	$	386,018	$	354,641		9%		$	1,118,333			$	1,032,735			8%	Revenues		$	481,670				$	475,651			1%				$	1,063,113			$	931,337			14%
Expenses	286,781		257,423		11%		828,352				755,182			10%	Expenses		365,810					339,630					8%				732,454				662,479				11%
Income from operations	99,237		97,218		2%		289,981				277,553			4%	Income from operations		115,860					136,021				(15)%				330,659				268,858				23%
Net gain from investments	645		196		NM		1,036				320			NM
Net (loss) gain from investments															Net (loss) gain from investments		(2,620)					377				NM				(3,109)				709				NM
Interest income, net of interest expense	1,554		911		71%		4,357				2,726			60%	Interest income, net of interest expense		1,642					748				120%				2,240				1,570				43%
Equity in earnings from unconsolidated affiliate	39,333		32,565		21%		109,213				92,042			19%	Equity in earnings from unconsolidated affiliate		29,813					35,065				(15)%				62,272				68,415				(9)%
Gain on sale of subsidiary	—		—		NM		—				2,791			NM
Income before income taxes	140,769		130,890		8%		404,587				375,432			8%	Income before income taxes		144,695					172,211				(16)%				392,062				339,552				15%
Income taxes	39,030		44,186		(12)%		122,342				130,226			(6)%	Income taxes		33,419					38,433				(13)%				90,478				76,304				19%
Net income	101,739		86,704		17%		282,245				245,206			15%	Net income		111,276					133,778				(17)%				301,584				263,248				15%
Diluted earnings per common share	$	0.63	$	0.53	19%		$	1.74			$	1.49		17%	Diluted earnings per common share		$	0.81				$	0.93			(13)%				$	2.17			$	1.82			19%

* Variances noted "NM" indicate the percent change is not meaningful.

The following items had a significant impact on our financial results for the three and ~~nine~~six months ended June 30, 2022 and 2021:

•~~September 30, 2017~~Revenue from Asset management, administration and ~~2016~~:

•

Revenue growth was primarily driven by higher Asset management, administration and distribution fees from market appreciation and positive cash flows from new and existing clients. Our average assets under management, excluding LSV, increased $21.5distribution fees increased from higher average assets under administration from market appreciation during 2021 and positive cash flows from new and existing clients despite the significant decline in market conditions in 2022. Average assets under administration increased $55.5 billion, or 7%, to $895.4 billion ~~or 11 percent, to $209.8 billion in the first nine months of~~ ~~2017~~ ~~as compared to $188.3 billion during the first nine months of~~ ~~2016. Our average assets under administration increased $59.9 billion, or 14 percent, to $491.2 billion in the first nine months of~~ ~~2017~~ ~~as compared to $431.3 billion during the first nine months of~~ ~~2016~~.

~~Our proportionate share in the earnings of LSV increased to $109.2 million~~ in the first ~~nine~~six months of ~~2017~~2022 as compared to ~~$92.0 million~~$839.9 billion during the first six months of 2021.

•Revenue from Asset management, administration and distribution fees were negatively impacted by a shift of our average assets under management into lower fee products. Average assets under management, excluding LSV, increased $21.0 billion, or 7%, to $307.9 billion in the first ~~nine~~six months of ~~2016 primarily due~~2022 as compared to ~~increased assets under management from LSV's existing clients due to market appreciation and increased performance fees.~~$286.9 billion during the first six months of 2021.

~~The direct costs associated with our~~•A significant investment ~~management programs increased in our~~processing client of the Private Banks ~~Investment Advisors and Institutional Investors segments. These costs primarily relate to~~segment terminated an agreement for convenience during the first quarter 2022. As a result, we recorded one-time early termination fees ~~charged by investment advisory firms for day-to-day portfolio management~~ of ~~SEI-sponsored investment products. These costs are~~$88.0 million. The early termination fee is included in ~~Sub-advisory, distribution~~Information processing and ~~other asset management costs~~software servicing fees on the accompanying Consolidated Statements of Operations.

•Revenues from our acquisitions of SEI Novus and Atlas Master Trust were $6.1 million and $2.5 million, respectively, during the first six months of 2022. SEI Novus and Atlas Master Trust were acquired during the fourth quarter of 2021 and are reported in the Institutional Investors segment (See Note 12 to the Consolidated Financial Statements).

~~24 of 42~~

~~We capitalized $40.6~~•Earnings from LSV decreased to $62.3 million in the first ~~nine~~six months of ~~2017~~2022 as compared to $68.4 million in the first six months of 2021 due to negative cash flows from existing clients, market depreciation and client losses.

•Operating expenses increased primarily from higher personnel and consulting costs due to business growth and competitive labor markets. The increase was partially offset by lower direct costs related to asset management revenues.

•The Institutional Investors segment includes personnel, professional fees, amortization and other costs related to SEI Novus and Atlas Master Trust. These expenses are primarily included in Compensation, benefits and other personnel costs, Consulting, outsourcing and professional fees, and Amortization on the accompanying Consolidated Statements of Operations.

•We capitalized $12.7 million in the first six months of 2022 for the SEI Wealth Platform as compared to ~~$27.4~~$12.2 million in the first ~~nine~~six months of ~~2016.~~2021. Amortization expense related to ~~the Platform increased to $37.3~~SWP was $23.9 million during the first ~~nine~~six months of ~~2017 as compared to $33.4~~2022 and 2021.

•We continued the stock repurchase program during 2022 and purchased 3.7 million during the first nine months of 2016 due to continued enhancements to the Platform. We are currently reassessing the remaining useful life of certain components and functionality of the Platform (See the caption "SEI Wealth Platform - Estimated Useful Life" later in this discussionshares for ~~more information).~~

~~We also capitalized $8.0~~$209.4 million in the ~~first nine months~~six month period.

Introduction of ~~2017~~Voluntary Separation Program

In June 2022, we initiated an enhanced voluntary separation program to long-tenured employees as ~~compared~~part of our commitment to ~~$5.8~~professional development and expanded responsibilities for current and new employees by increasing advancement opportunities. The program was offered to employees in the United States who met the long-term tenure requirements and includes a severance package and the continuation of certain benefits. We expect a one-time increase between $54.0 million and $58.0 million in personnel costs associated with the first nine months of 2016 for an application being developed for the Investment Managers segment. This new offering includes components that leverage upon the current infrastructure and add significant enhancements designed to aggregate, transact and process data. The application is expected to be placed into serviceprogram during the ~~first~~third quarter ~~of 2018 with an estimated useful life of five years.~~

As we continue the development of new elements of the Platform, our expenses related to maintenance and support have increased. These costs are primarily recognized in personnel and consulting costs and are not eligible for capitalization. These increased costs primarily impacted the Private Banks and Investment Advisors business segments.

Our operating expenses, primarily personnel costs, in our Investment Advisors and Investment Managers segments increased. These expenses primarily consist of operational, technology and marketing costs and are mainly related to servicing existing clients and acquiring new clients. These operating expenses are included in Compensation, benefits and other personnel costs on the accompanying Consolidated Statements of Operations.


•	~~Stock-based compensation costs increased to~~ ~~$19.5 million~~ ~~in the first nine months of 2017 as compared to $12.0 million in the first nine months 2016. The increase was primarily due to stock option awards granted in late 2016.~~

•

~~Our effective tax rate during the third quarter of 2017 was 27.7 percent as compared to 33.8 percent during the third quarter of 2016. During the first nine months of~~ ~~2017, our effective tax rate was 30.2 percent as compared to 34.7 percent during the first nine months of~~ ~~2016~~. The decline in our effective tax rates during the third quarter and the nine month period was primarily due to the adoption of a new accounting standard which requires all excess tax benefits or deficiencies recognized on stock-based compensation expense to be recorded as an income tax benefit or expense in the income statement. The decline was also due to the expiration of the statute of limitations pertaining to various federal tax items. Our quarterly effective tax rate could fluctuate significantly due to the tax effects of stock-based compensation (See Note 11 to the Consolidated Financial Statements for more information).

On July 3, 2017, we acquired Archway Technology Partners, LLC (Archway), a provider of operating technologies and services to the family office industry, for $81.5 million in cash consideration with up to an additional $8.0 million payable to the seller as a contingent purchase price with respect to two one-year periods ending December 31, 2017 and 2018 depending upon whether Archway achieves specified financial measures. The results of operations of Archway are included in our Investment Managers business segment2022 (See Note 14 to the ~~Notes to~~ Consolidated Financial Statements).

We recorded our final pre-tax gain of $2.8 million, or $.01 diluted earnings per share, from the sale of SEI Asset Korea (SEI AK) in the first nine months of 2016. The gain from the sale is included in Gain on sale of subsidiary on the accompanying Consolidated Statement of Operations (See Note 13 to the Consolidated Financial Statements for more information).


•	~~We continued our stock repurchase program during~~ ~~2017~~ ~~and purchased~~ ~~3.5 million~~ ~~shares for $188.3 million in the~~ ~~nine~~ ~~month period.~~


•	~~In July 2017, we borrowed~~ ~~$40.0 million~~ ~~under our credit facility for the acquisition of Archway (See Note 7).~~

~~25 of 42~~

Ending Asset Balances

(In millions)

As of September 30, Percent Change
2017 2016
Private Banks:
Equity and fixed-income programs $ 21,196
$ 18,668
14%
Collective trust fund programs 4
3
33%
Liquidity funds 3,345
4,034
(17)%
Total assets under management $ 24,545
$ 22,705
8%
Client assets under administration 22,107
19,269
15%
Total assets $ 46,652
$ 41,974
11%
Investment Advisors:
Equity and fixed-income programs 59,455
52,594
13%
Collective trust fund programs 5
5
—%
Liquidity funds 2,327
2,539
(8)%
Total assets under management $ 61,787
$ 55,138
12%
Institutional Investors:
Equity and fixed-income programs 84,939
78,701
8%
Collective trust fund programs 82
90
(9)%
Liquidity funds 3,699
2,612
42%
Total assets under management $ 88,720
$ 81,403
9%
Advised assets 4,450
—
NM
Total assets 93,170
81,403
14%
Investment Managers:
Equity and fixed-income programs 93
79
18%
Collective trust fund programs 46,087
35,962
28%
Liquidity funds 799
812
(2)%
Total assets under management $ 46,979
$ 36,853
27%
Client assets under administration (A) 493,538
451,204
9%
Total assets $ 540,517
$ 488,057
11%
Investments in New Businesses:
Equity and fixed-income programs 1,052
850
24%
Liquidity funds 71
53
34%
Total assets under management $ 1,123
$ 903
24%
Advised assets 54
—
NM
Total assets 1,177
903
30%
LSV:
Equity and fixed-income programs $ 101,893
$ 83,863
21%
Total:
Equity and fixed-income programs (B) 268,628
234,755
14%
Collective trust fund programs 46,178
36,060
28%
Liquidity funds 10,241
10,050
2%
Total assets under management $ 325,047
$ 280,865
16%
Advised assets (C) 4,504
—
NM
Client assets under administration (D) 515,645
470,473
10%
Total assets under management, advisement and administration $ 845,196
$ 751,338
12%


	As of June 30,				Percent Change
	2022		2021
Private Banks:
Equity and fixed-income programs	$	22,277	$	26,264	(15)%
Collective trust fund programs	7		7		—%
Liquidity funds	3,666		3,654		—%
Total assets under management	$	25,950	$	29,925	(13)%
Client assets under administration	3,923		4,412		(11)%
Total assets	$	29,873	$	34,337	(13)%
Investment Advisors:
Equity and fixed-income programs	$	65,783	$	78,053	(16)%
Liquidity funds	8,292		3,550		134%
Total Platform assets under management	$	74,075	$	81,603	(9)%
Platform-only assets (E)	12,642		13,566		(7)%
Total Platform assets (E)	$	86,717	$	95,169	(9)%
Institutional Investors:
Equity and fixed-income programs	$	75,506	$	93,010	(19)%
Collective trust fund programs	5		5		—%
Liquidity funds	1,654		2,516		(34)%
Total assets under management	$	77,165	$	95,531	(19)%
Client assets under advisement	4,218		4,566		(8)%
Total assets	$	81,383	$	100,097	(19)%
Investment Managers:
Collective trust fund programs	$	142,035	$	87,012	63%
Liquidity funds	271		473		(43)%
Total assets under management	$	142,306	$	87,485	63%
Client assets under administration (A)	885,096		875,942		1%
Total assets	$	1,027,402	$	963,427	7%
Investments in New Businesses:
Equity and fixed-income programs	$	1,903	$	1,924	(1)%
Liquidity funds	242		191		27%
Total assets under management	$	2,145	$	2,115	1%
Client assets under advisement	1,076		1,422		(24)%
Total assets	$	3,221	$	3,537	(9)%
LSV:
Equity and fixed-income programs (B)	$	81,940	$	102,404	(20)%

~~26 of 42~~


Total:
Equity and fixed-income programs (C)	$	247,409	$	301,655	(18)%
Collective trust fund programs	142,047		87,024		63%
Liquidity funds	14,125		10,384		36%
Total assets under management	$	403,581	$	399,063	1%
Client assets under advisement	5,294		5,988		(12)%
Client assets under administration (D)	889,019		880,354		1%
Platform-only assets	12,642		13,566		(7)%
Total assets	$	1,310,536	$	1,298,971	1%


~~(A)~~	Client assets under administration in the Investment Managers segment include $48.1 billion of assets that require limited services and therefore are at fee levels below our normal full service assets (as of September 30, 2017).


~~(B)~~	~~Equity and fixed-income programs include $5.5 billion of assets invested in asset allocation funds at September 30, 2017.~~


~~(C)~~	~~Assets for which SEI acts as an advisor to the accounts. These assets were excluded in previous periods.~~


~~(D)~~	~~In addition to the numbers presented, SEI also administers an additional $11.1 billion in Funds of Funds assets (as of~~

~~September~~(A)Client assets under administration in the Investment Managers segment include $80.7 billion of assets that are at fee levels below our normal full service assets (as of June 30, ~~2017)~~2022).

(B) Equity and fixed-income programs include assets managed by LSV in which fees are based on performance only. The ending value of these assets as of June 30, 2022 was $1.9 billion.

(C) Equity and fixed-income programs include $6.4 billion of assets invested in various asset allocation funds at June 30, 2022.

(D) In addition to the numbers presented, SEI also administers an additional $12.9 billion in Funds of Funds assets (as of June 30, 2022) on which SEI does not earn an administration fee.

(E) Platform assets under management and Platform-only assets combined are total Platform assets in the Investment Advisors segment.

~~27 of 42~~

Average Asset Balances

(In millions)


	Three Months Ended June 30,				Percent Change	Six Months Ended June 30,				Percent Change
	2022		2021			2022		2021
Private Banks:
Equity and fixed-income programs	$	23,713	$	26,056	(9)%	$	24,675	$	25,598	(4)%
Collective trust fund programs	7		7		—%	7		7		—%
Liquidity funds	3,795		3,833		(1)%	4,099		3,855		6%
Total assets under management	$	27,515	$	29,896	(8)%	$	28,781	$	29,460	(2)%
Client assets under administration	4,163		4,405		(5)%	4,332		4,361		(1)%
Total assets	$	31,678	$	34,301	(8)%	$	33,113	$	33,821	(2)%
Investment Advisors:
Equity and fixed-income programs	$	70,436	$	76,840	(8)%	$	74,006	$	75,040	(1)%
Liquidity funds	7,070		3,370		110%	6,111		3,495		75%
Total Platform assets under management	$	77,506	$	80,210	(3)%	$	80,117	$	78,535	2%
Platform-only assets (E)	13,142		13,292		(1)%	13,560		12,749		6%
Total Platform assets (E)	$	90,648	$	93,502	(3)%	$	93,677	$	91,284	3%
Institutional Investors:
Equity and fixed-income programs	$	80,971	$	93,458	(13)%	$	85,111	$	92,404	(8)%
Collective trust fund programs	5		68		(93)%	5		82		(94)%
Liquidity funds	2,097		2,681		(22)%	2,160		2,651		(19)%
Total assets under management	$	83,073	$	96,207	(14)%	$	87,276	$	95,137	(8)%
Client assets under advisement	3,987		4,516		(12)%	4,438		4,331		2%
Total assets	$	87,060	$	100,723	(14)%	$	91,714	$	99,468	(8)%
Investment Managers:
Collective trust fund programs	$	131,435	$	84,553	55%	$	109,034	$	81,294	34%
Liquidity funds	285		469		(39)%	359		480		(25)%
Total assets under management	$	131,720	$	85,022	55%	$	109,393	$	81,774	34%
Client assets under administration (A)	893,361		853,810		5%	891,108		835,570		7%
Total assets	$	1,025,081	$	938,832	9%	$	1,000,501	$	917,344	9%
Investments in New Businesses:
Equity and fixed-income programs	$	2,016	$	1,870	8%	$	2,021	$	1,807	12%
Liquidity funds	262		236		11%	274		203		35%
Total assets under management	$	2,278	$	2,106	8%	$	2,295	$	2,010	14%
Client assets under advisement	1,165		1,406		(17)%	1,281		1,367		(6)%
Total assets	$	3,443	$	3,512	(2)%	$	3,576	$	3,377	6%
LSV:
Equity and fixed-income programs (B)	$	87,818	$	103,583	(15)%	$	92,134	$	100,530	(8)%

Three Months Ended September 30, Percent Change Nine Months Ended September 30, Percent Change
2017 2016 2017 2016
Private Banks:
Equity and fixed-income programs $ 20,699
$ 18,650
11% $ 19,602
$ 18,266
7%
Collective trust fund programs 4
3
33% 4
3
33%
Liquidity funds 3,555
4,386
(19)% 3,761
5,055
(26)%
Total assets under management $ 24,258
$ 23,039
5% $ 23,367
$ 23,324
—%
Client assets under administration 21,441
19,039
13% 20,943
18,241
15%
Total assets $ 45,699
$ 42,078
9% $ 44,310
$ 41,565
7%
Investment Advisors:
Equity and fixed-income programs 58,406
51,924
12% 56,390
48,627
16%
Collective trust fund programs 5
5
—% 5
6
(17)%
Liquidity funds 2,335
2,694
(13)% 2,428
3,921
(38)%
Total assets under management $ 60,746
$ 54,623
11% $ 58,823
$ 52,554
12%
Institutional Investors:
Equity and fixed-income programs 83,696
77,583
8% 80,703
74,782
8%
Collective trust fund programs 80
90
(11)% 85
95
(11)%
Liquidity funds 3,177
2,751
15% 2,976
2,818
6%
Total assets under management $ 86,953
$ 80,424
8% $ 83,764
$ 77,695
8%
Advised assets 4,376
—
NM 3,729
—
NM
Total assets 91,329
80,424
14% 87,493
77,695
13%
Investment Managers:
Equity and fixed-income programs 92
73
26% 84
70
20%
Collective trust fund programs 44,824
35,257
27% 41,840
33,021
27%
Liquidity funds 952
874
9% 916
802
14%
Total assets under management $ 45,868
$ 36,204
27% $ 42,840
$ 33,893
26%
Client assets under administration 486,158
436,459
11% 470,208
413,039
14%
Total assets $ 532,026
$ 472,663
13% $ 513,048
$ 446,932
15%
Investments in New Businesses:
Equity and fixed-income programs 1,016
845
20% 960
804
19%
Liquidity funds 55
44
25% 61
44
39%
Total assets under management $ 1,071
$ 889
20% $ 1,021
$ 848
20%
Advised assets 73
—
NM 76
—
NM
Total assets 1,144
889
29% 1,097
848
29%
LSV:
Equity and fixed-income programs $ 99,279
$ 83,373
19% $ 94,216
$ 79,268
19%
Total:
Equity and fixed-income programs 263,188
232,448
13% 251,955
221,817
14%
Collective trust fund programs 44,913
35,355
27% 41,934
33,125
27%
Liquidity funds 10,074
10,749
(6)% 10,142
12,640
(20)%
Total assets under management $ 318,175
$ 278,552
14% $ 304,031
$ 267,582
14%
Advised assets 4,449
—
NM 3,805
—
NM
Client assets under administration 507,599
455,498
11% 491,151
431,280
14%
Total assets under management, advisement and administration $ 830,223
$ 734,050
13% $ 798,987
$ 698,862
14%

~~28 of 42~~


Total:
Equity and fixed-income programs (C)	$	264,954	$	301,807	(12)%	$	277,947	$	295,379	(6)%
Collective trust fund programs	131,447		84,628		55%	109,046		81,383		34%
Liquidity funds	13,509		10,589		28%	13,003		10,684		22%
Total assets under management	$	409,910	$	397,024	3%	$	399,996	$	387,446	3%
Client assets under advisement	5,152		5,922		(13)%	5,719		5,698		—%
Client assets under administration (D)	897,524		858,215		5%	895,440		839,931		7%
Platform-only assets	13,142		13,292		(1)%	13,560		12,749		6%
Total assets	$	1,325,728	$	1,274,453	4%	$	1,314,715	$	1,245,824	6%

(A) Average client assets under administration in the Investment Managers segment for the three months ended June 30, 2022 include $80.7 billion that are at fee levels below our normal full service assets.

(B) Equity and fixed-income programs include assets managed by LSV in which fees are based on performance only. The average value of these assets for the three months ended June 30, 2022 was $2.1 billion.

(C) Equity and fixed-income programs include $6.9 billion of average assets invested in various asset allocation funds for the three months ended June 30, 2022.

(D) In addition to the numbers presented, SEI also administers an additional $13.1 billion of average assets in Funds of Funds assets for the three months ended June 30, 2022 on which SEI does not earn an administration fee.

(E) Platform assets under management and Platform-only assets combined are total Platform assets in the Investment Advisors segment.

In the preceding tables, assets under management are total assets of our clients or their customers invested in ~~our~~ equity and fixed-income investment programs, collective trust fund programs, and liquidity funds for which we provide asset management services through our subsidiaries and partnerships in which we have a significant interest. ~~Advised assets~~Assets under advisement include assets for which we provide advisory services through a subsidiary to the accounts but do not manage the underlying assets. Assets under administration include total assets of our clients or their customers for which we provide administrative services, including client fund balances for which we provide administration and/or distribution services through our subsidiaries and partnerships in which we have a significant interest. Platform-only assets include total assets of our clients or their customers which are not invested in any SEI-sponsored investment products. The assets presented in the preceding tables do not include assets processed on ~~the SEI Wealth Platform~~SWP and are not included in the accompanying Consolidated Balance Sheets because we do not own them.

Business Segments

Revenues, Expenses and Operating Profit (Loss) for our business segments for the three and ~~nine~~six months ended ~~September~~June 30, ~~2017~~2022 compared to the three and ~~nine~~six months ended ~~September~~June 30, ~~2016~~2021 were as follows:

Three Months Ended September 30,
Percent
Change
Nine Months Ended September 30,
Percent
Change
2017 2016 2017 2016
Private Banks:
Revenues $ 118,499
$ 115,952
2% $ 347,317
$ 344,149
1%
Expenses 115,806
105,523
10% 336,709
312,126
8%
Operating Profit $ 2,693
$ 10,429
(74)% $ 10,608
$ 32,023
(67)%
Gain on sale of subsidiary —
—
—% —
2,791
NM
Segment Profit $ 2,693
$ 10,429
(74)% $ 10,608
$ 34,814
NM
Operating Margin (A) 2 % 9 % 3 % 9 %
Investment Advisors:
Revenues $ 94,318
$ 85,258
11% $ 275,302
$ 243,820
13%
Expenses 50,585
45,080
12% 147,504
134,575
10%
Operating Profit $ 43,733
$ 40,178
9% $ 127,798
$ 109,245
17%
Operating Margin 46 % 47 % 46 % 45 %
Institutional Investors:
Revenues $ 80,411
$ 76,222
5% $ 235,483
$ 223,793
5%
Expenses 40,003
36,943
8% 117,499
108,875
8%
Operating Profit $ 40,408
$ 39,279
3% $ 117,984
$ 114,918
3%
Operating Margin 50 % 52 % 50 % 51 %
Investment Managers:
Revenues $ 91,020
$ 75,672
20% $ 255,123
$ 216,528
18%
Expenses 59,831
48,588
23% 165,743
140,831
18%
Operating Profit $ 31,189
$ 27,084
15% $ 89,380
$ 75,697
18%
Operating Margin 34 % 36 % 35 % 35 %
Investments in New Businesses:
Revenues $ 1,770
$ 1,537
15% $ 5,108
$ 4,445
15%
Expenses 5,063
5,348
(5)% 15,067
15,935
(5)%
Operating Loss $ (3,293 ) $ (3,811 ) NM $ (9,959 ) $ (11,490 ) NM

~~(A) Percentages determined exclusive of gain from sale of subsidiary.~~


	Three Months Ended June 30,						Percent Change	Six Months Ended June 30,						Percent Change
	2022			2021				2022			2021
Private Banks:
Revenues	$	124,184		$	123,676		—%	$	337,732		$	241,284		40%
Expenses	121,060			117,654			3%	243,015			228,378			6%
Operating Profit	$	3,124		$	6,022		(48)%	$	94,717		$	12,906		NM
Operating Margin	3		%	5		%		28		%	5		%
Investment Advisors:
Revenues	$	113,194		$	119,396		(5)%	$	232,424		$	232,690		—%
Expenses	63,375			59,133			7%	127,895			114,160			12%
Operating Profit	$	49,819		$	60,263		(17)%	$	104,529		$	118,530		(12)%
Operating Margin	44		%	50		%		45		%	51		%
Institutional Investors:
Revenues	$	83,483		$	85,699		(3)%	$	170,322		$	170,198		—%
Expenses	43,925			41,895			5%	89,283			81,053			10%
Operating Profit	$	39,558		$	43,804		(10)%	$	81,039		$	89,145		(9)%
Operating Margin	47		%	51		%		48		%	52		%
Investment Managers:
Revenues	$	155,926		$	142,808		9%	$	312,827		$	279,227		12%
Expenses	100,807			84,995			19%	199,644			168,015			19%
Operating Profit	$	55,119		$	57,813		(5)%	$	113,183		$	111,212		2%
Operating Margin	35		%	40		%		36		%	40		%
Investments in New Businesses:
Revenues	$	4,883		$	4,072		20%	$	9,808		$	7,938		24%
Expenses	12,844			13,631			(6)%	24,794			27,035			(8)%
Operating Loss	$	(7,961)		$	(9,559)		NM	$	(14,986)		$	(19,097)		NM

For additional information pertaining to our business segments, see Note 109 to the Consolidated Financial Statements.

~~29 of 42~~

Private Banks


	Three Months Ended June 30,				Percent Change	Six Months Ended June 30,				Percent Change
	2022		2021			2022		2021
Revenues:
Information processing and software servicing fees	$	93,203	$	89,264	4%	$	274,240	$	173,567	58%
Asset management, administration & distribution fees	30,981		34,412		(10)%	63,492		67,717		(6)%
Total revenues	$	124,184	$	123,676	—%	$	337,732	$	241,284	40%

Three Months Ended September 30,
Percent
Change
Nine Months Ended September 30,
Percent
Change
2017 2016 2017 2016
Revenues:
Information processing and software servicing fees $ 78,089
$ 75,945
3% $ 229,676
$ 223,374
3%
Asset management, administration & distribution fees 35,726
34,356
4% 102,352
101,001
1%
Transaction-based and trade execution fees 4,684
5,651
(17)% 15,289
19,774
(23)%
Total revenues $ 118,499
$ 115,952
2% $ 347,317
$ 344,149
1%

Revenues increased ~~$2.5 million, or two percent,~~ slightly in the three month period and increased ~~$3.2~~$96.4 million, or ~~one percent,~~40%, in the ~~nine~~six month period ended ~~September~~June 30, ~~2017~~2022 and were primarily affected by:

•Early termination fees of $88.0 million recorded during the first quarter 2022 from a significant investment processing client; and

•Increased ~~recurring~~ investment processing fees from ~~the~~new client conversions and growth ~~in new and existing client assets processed on the SEI Wealth Platform;~~

~~Increased non-recurring professional services fees~~ from existing SWP clients, ~~as well as clients scheduled for implementation on the SEI Wealth Platform;~~

~~Increased investment management fees from existing international clients due to increased net cash flows and higher average assets under management~~in part due to market ~~appreciation; and~~

~~The positive impact from foreign currency exchange rate fluctuations between the U.S. dollar and the British pound on our foreign operations~~appreciation during ~~the third quarter 2017;~~2021; partially offset by

~~Decreased trade execution~~•One-time early termination fees ~~due to lower trading volumes;~~from a TRUST 3000® client recorded in the second quarter 2021;

•The ~~net~~ negative impact from foreign currency exchange rate fluctuations between the U.S. dollar and the British pound on our foreign ~~operations during the nine month period ended September 30, 2017;~~operations; and

•Decreased investment management fees from ~~liquidity products~~existing international clients due to ~~changes in product mix; and~~market depreciation during 2022.

~~Decreased investment processing fees from the loss of TRUST 3000® clients.~~

Operating margins decreased to ~~two percent~~3% compared to ~~nine percent~~5% in the three month period and ~~decreased~~increased to ~~three percent~~28% compared to ~~nine percent~~5% in the ~~nine~~six month period. Operating income decreased by ~~$7.7~~$2.9 million,, or ~~74 percent,~~48%, in the three month period and ~~decreased $21.4~~increased $81.8 million ~~or 67 percent~~ in the ~~nine~~six month period and was primarily affected by:

•An increase in revenues; and

•Decreased direct expenses associated with lower investment management fees from existing international clients; partially offset by

•Increased ~~non-capitalized~~personnel costs due to competitive labor markets;

•Increased costs, mainly personnel and consulting costs, primarily related to maintenance, support and ~~support of the SEI Wealth Platform;~~client migrations to SWP;

~~Increased amortization expense related to the SEI Wealth Platform;~~

•The ~~net~~ negative impact from foreign currency exchange rate fluctuations between the U.S. dollar and the British pound on our foreign ~~operations during~~operations; and

•Increased amortization expense related to deferred sales commissions.

Investment Advisors


	Three Months Ended June 30,				Percent Change	Six Months Ended June 30,				Percent Change
	2022		2021			2022		2021
Revenues:
Investment management fees-SEI fund programs	$	67,490	$	75,039	(10)%	$	139,483	$	147,693	(6)%
Separately managed account fees	40,398		38,345		5%	82,406		73,059		13%
Other fees	5,306		6,012		(12)%	10,535		11,938		(12)%
Total revenues	$	113,194	$	119,396	(5)%	$	232,424	$	232,690	—%

Revenues decreased $6.2 million, or 5%, in the ~~nine~~three month period and decreased slightly in the six month period ended ~~September~~June 30, ~~2017;~~2022 and were primarily affected by:

•Decreased investment management fees from SEI fund programs resulting from negative cash flows during 2021 and the decline in market conditions during 2022; partially offset by

•Increased ~~salary, incentive compensation~~separately managed account program fees from positive cash flows into our Strategist programs and ~~stock-based compensation costs;~~market appreciation occurring during 2021.

Operating margin decreased to 44% compared to 50% in the three month period and decreased to 45% compared to 51% in the six month period. Operating income decreased $10.4 million, or 17%, in the three month period and decreased $14.0 million, or 12%, in the six month period and was primarily affected by:

•Increased direct expenses associated with increased ~~investment management fees from existing international clients; partially offset by~~

~~Decreased direct expenses associated with the decreased trade execution fees;~~assets into our separately managed account program; and

~~The positive impact from foreign currency exchange rate fluctuations between the U.S. dollar and the British pound on our foreign operations during the third quarter 2017.~~

~~30 of 42~~

~~Investment Advisors~~

Three Months Ended September 30,
Percent
Change
Nine Months Ended September 30,
Percent
Change
2017 2016 2017 2016
Revenues:
Investment management fees-SEI fund programs $ 70,640
$ 63,914
11% $ 205,609
$ 185,272
11%
Separately managed account fees 19,789
17,078
16% 57,697
47,153
22%
Other fees 3,889
4,266
(9)% 11,996
11,395
5%
Total revenues (a) $ 94,318
$ 85,258
11% $ 275,302
$ 243,820
13%

(a) All amounts are reflected in Asset management, administration and distribution fees except for $91 and $186 in the three months ended September 30, 2017 and 2016, respectively, and $818 and $727 in the nine months ended September 30, 2017 and 2016, respectively, which are reflected in Transaction-based and trade execution fees.

•Increased personnel costs as well as increased promotion costs.

Institutional Investors

Revenues ~~increased$9.1~~decreased $2.2 million,, or ~~11 percent~~3%, in the three month period and increased ~~$31.5 million, or 13 percent,~~slightly in the ~~nine~~six month period ended ~~September~~June 30, ~~2017~~2022 and were primarily affected by:

•Added revenues from the acquisitions of SEI Novus and Atlas Master Trust during the fourth quarter 2021; and

~~Increased investment management fees and separately managed account program fees due~~•The positive impact to ~~higher assets under management caused by market appreciation and positive cash flows from new and existing advisors.~~

~~Operating margin decreased to~~ ~~46 percent~~ ~~compared to~~ ~~47 percent~~ in the three month period and increased to 46 percent compared to 45 percent in the nine month period. Operating income increased $3.6 million, or nine percent, in the three month period and increased $18.6 million, or 17 percent, in the nine month period and was primarily affected by:

~~An increase in revenues; and~~

~~Decreased sales compensation expense; partially offset by~~

~~Increased direct expenses associated with increased assets in our investment management programs;~~

~~Increased personnel costs for marketing to and servicing new advisors;~~

~~Increased non-capitalized costs, mainly personnel and consulting costs, related to maintenance, support and client migrations to the SEI Wealth Platform;~~

~~Increased stock-based compensation costs; and~~

~~Increased amortization expense related to the SEI Wealth Platform.~~

~~Institutional Investors~~

~~Revenues~~ ~~increased~~ ~~$4.2 million, or five percent, in the three month period and increased $11.7 million, or five percent, in the nine month period ended~~ ~~September 30, 2017~~ ~~and were primarily affected by:~~

~~Increased~~ investment management fees from ~~existing clients due to higher assets under management caused~~market appreciation in 2021; partially offset by ~~market appreciation;~~

~~Asset funding from new sales of our~~•Decreased investment management ~~solutions;~~fees from defined benefit client losses; and

•The ~~positive impact from foreign currency exchange rate fluctuations between the U.S. dollar and the British pound on our foreign operations during the third quarter 2017; partially offset by~~

~~Client losses;~~

~~The net~~ negative impact from foreign currency exchange rate fluctuations between the U.S. dollar and the British pound on our foreign ~~operations during the nine month period ended September 30, 2017; and~~

~~A decrease in the average basis points earned on client assets.~~

~~31 of 42~~

operations.

Operating ~~margins~~margin decreased to ~~50 percent~~47% compared to ~~52 percent~~51% in the three month period and decreased to ~~50 percent~~48% compared to ~~51 percent~~52% in the ~~nine~~six month period. Operating income ~~increased $1.1~~decreased $4.2 million, or ~~three percent,~~10%, in the three month period and ~~increased $3.1~~decreased $8.1 million, or ~~three percent,~~9%, in the ~~nine~~six month period and was primarily affected by:

~~An increase in revenues;~~•Increased personnel, professional fees, amortization and

~~The positive impact from foreign currency exchange rate fluctuations between~~ other costs related to the ~~U.S. dollar~~acquisitions of SEI Novus and ~~the British pound on our foreign operations during the third quarter 2017;~~Atlas Master Trust; partially offset by

~~Increased~~•Decreased direct expenses associated with investment management ~~fees;~~

~~Increased personnel compensation costs, including stock-based compensation costs; and~~

~~The net negative impact from foreign currency exchange rate fluctuations between the U.S. dollar and the British pound on our foreign operations during the nine month period ended September 30, 2017.~~

fees.

Investment Managers

Revenues increased~~$15.3~~ $13.1 million,, or ~~20 percent~~9%, in the three month period and increased ~~$38.6~~$33.6 million, or ~~18 percent,~~12%, in the ~~nine~~six month period ended ~~September~~June 30, ~~2017~~2022 and were primarily affected by:

•Higher valuations of existing client assets from ~~improved capital markets:~~market appreciation in 2021; and

•Positive cash flows into alternative, traditional and separately managed account offerings from new and existing clients; ~~and~~

~~Added revenues of $5.0 million from the acquisition of Archway during the third quarter 2017;~~ partially offset by

•Client losses and fund closures.

Operating margin decreased to ~~34 percent~~35% compared to ~~36 percent~~40% in the three month period and ~~remained at 35 percent~~decreased to 36% compared to 40% in the ~~nine~~six month period. Operating income ~~increased $4.1~~decreased $2.7 million, or ~~15 percent,~~5%, in the three month period and increased ~~$13.7~~$2.0 million, or ~~18 percent,~~2%, in the ~~nine~~six month period and was primarily affected by:

•An increase in revenues; partially offset by

•Increased personnel costs due to competitive labor markets;

•Increased costs associated with new business, primarily personnel expenses ~~technology~~ and ~~other operational costs to service new~~third-party vendor costs; and ~~existing clients;~~

~~Increased incentive compensation and stock-based compensation costs;~~

~~Increased personnel and amortization expense related to the Archway acquisition; and~~

•Increased non-capitalized investment spending, mainly consulting costs.

Other

Corporate overhead expenses

Corporate overhead expenses primarily consist of general and administrative expenses and other costs not directly attributable to a reportable business segment. Corporate overhead expenses were ~~$15.5~~$23.8 million and ~~$15.9~~$22.3 million in the three months ended ~~September~~June 30, ~~2017~~2022 and ~~2016~~,2021, respectively, and ~~$45.8~~$47.8 million and ~~$42.8~~$43.8 million in the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2022 and ~~2016,~~2021, respectively. The increase in corporate overhead expenses in the ~~nine~~three and six month ~~period~~periods is primarily due to ~~increased~~an increase in personnel ~~compensation expense, mainly salary, incentive compensation~~costs, consulting and ~~stock-based compensation costs.~~professional fees.

Other income and expense

Other income and expense items on the accompanying Consolidated Statements of Operations consists of:


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Net (loss) gain from investments	$	(2,620)	$	377	$	(3,109)	$	709
Interest and dividend income	1,853		878		2,701		1,823
Interest expense	(211)		(130)		(461)		(253)
Equity in earnings of unconsolidated affiliate	29,813		35,065		62,272		68,415
Total other income and expense items, net	$	28,835	$	36,190	$	61,403	$	70,694

Three Months Ended September 30, Nine Months Ended September 30,
2017 2016 2017 2016
Net gain from investments $ 645
$ 196
$ 1,036
$ 320
Interest and dividend income 1,899
1,026
4,928
3,142
Interest expense (345 ) (115 ) (571 ) (416 )
Equity in earnings of unconsolidated affiliate 39,333
32,565
109,213
92,042
Gain on sale of subsidiary —
—
—
2,791
Total other income and expense items, net $ 41,532
$ 33,672
$ 114,606
$ 97,879
Net (loss) gain from investments

Net losses from investments in the three and six months ended June 30, 2022 were primarily due to unrealized mark-to-market losses recorded in current earnings associated with the LSV-sponsored investment funds and Company-sponsored mutual funds from the significant decline in market conditions in 2022 (See Note 5).

Interest and dividend income

Interest and dividend income is earned based upon the amount of cash that is invested daily. The increase in interest and dividend income in the three and six months ended June 30, 2022 was due to an overall increase in interest rates.

Equity in earnings of unconsolidated affiliate

Equity in earnings of unconsolidated affiliate reflects our ~~less than 50 percent~~ ownership interest in LSV. As of June 30, 2022, our total partnership interest in LSV was 38.6%. The table below presents the revenues and net income of LSV and ~~our~~the proportionate share in LSV's earnings.

~~32 of 42~~


	Three Months Ended September 30,				Percent Change		Nine Months Ended September 30,							Percent Change			Three Months Ended June 30,									Percent Change				Six Months Ended June 30,								Percent Change
	2017		2016			2017				2016					2022						2021								2022				2021
Revenues of LSV	$	126,723	$	103,341		23%		$	355,996			$	291,819			22%	Revenues of LSV		$	99,814				$	116,392			(14)%				$	208,264			$	227,229			(8)%
Net income of LSV	101,130		83,646		21%		280,717				235,893			19%	Net income of LSV		77,193					90,520					(15)%				160,984				176,440				(9)%

SEI's proportionate share in earnings of LSV	$	39,333	$	32,565	21%		$	109,213			$	92,042		19%	SEI's proportionate share in earnings of LSV		$	29,813				$	35,065			(15)%				$	62,272			$	68,415			(9)%

The ~~increase~~decrease in ~~our~~ earnings from LSV in the three and six months ended June 30, 2022 was primarily due to ~~increased assets under management~~negative cash flows from ~~LSV's~~ existing clients, ~~due to~~ market ~~appreciation~~depreciation and ~~increased performance fees; however, our earnings were negatively impacted by increased personnel expenses of LSV.~~client losses. Average assets under management by LSV ~~increased $14.9~~decreased $8.4 billion to ~~$94.2~~$92.1 billion during the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2022 as compared to ~~$79.3~~$100.5 billion during the ~~nine~~six months ended ~~September~~June 30, ~~2016, an increase~~2021, a decrease of ~~19 percent.~~8%.

In April 2016, LSV provided an interest in the partnership to select key employees which reduced the ownership percentage of each existing partner on a pro-rata basis. As a result, our total partnership interest in LSV was reduced from approximately 39.2 percent to approximately 38.9 percent.Amortization

~~Gain on sale of subsidiary~~

~~We recorded a gain of $2.8 million during the nine months ended September 30, 2016 from the sale of our ownership interests in SEI AK. This gain is included in Gain on sale of subsidiary~~Amortization expense on the accompanying Consolidated ~~Statement~~Statements of Operations consists of:


	Three Months Ended June 30,				Percent Change	Six Months Ended June 30,				Percent Change
	2022		2021			2022		2021
Capitalized software development costs	$	13,204	$	13,402	(1)%	$	26,758	$	26,775	—%
Intangible assets acquired through acquisitions and asset purchases	3,243		921		252%	6,496		2,117		207%
Other	80		58		38%	80		58		38%
Total amortization expense	$	16,527	$	14,381	15%	$	33,334	$	28,950	15%

Capitalized software development costs

Capitalized software development costs are amortized on a project basis using the straight-line method over the estimated economic life of the product or enhancement. The capitalization of the initial development work related to SWP began in mid-2007 when the platform was determined to be ready for its intended use. The amortization expense related to the initial software development costs capitalized in 2007 ended in the second quarter of 2022. As a result, we expect amortization expense related to capitalized software in service as of June 30, 2022 to decline to approximately $6.7 million in the third quarter 2022 (See Note 131 to the Consolidated Financial ~~Statements for more information)~~Statements).

Intangible assets acquired through acquisitions and asset purchases

The increase in amortization expense in the three and six month periods was due to the acquisitions of Finomial, SEI Novus and Atlas Master Trust during the fourth quarter 2021. Through these transactions, we acquired intangible assets related to technology, trade names and client relationships which are amortized over the estimated useful life of the assets (See Note 12 to the Consolidated Financial Statements).

Income Taxes

~~Our~~The effective income tax rates for the three and ~~nine~~six months ended ~~September~~June 30, ~~2017~~2022 and ~~2016 differs~~2021 differ from the federal income tax statutory rate due to the following:


	Three Months Ended September 30,				Nine Months Ended September 30,					Three Months Ended June 30,				Six Months Ended June 30,
	2017		2016		2017		2016			2022		2021		2022		2021
Statutory rate	35.0	%	35.0	%	35.0	%	35.0	%	Statutory rate	21.0	%	21.0	%	21.0	%	21.0	%
State taxes, net of federal tax benefit	1.7		1.2		1.7		1.5		State taxes, net of federal tax benefit	2.8		3.2		2.8		3.2
Foreign tax expense and tax rate differential	(1.0	)	(0.8	)	(1.0	)	(0.8	)	Foreign tax expense and tax rate differential	(0.1)		(0.1)		(0.1)		(0.1)
Tax benefit from stock option exercises	(4.5	)	—		(3.9	)	—		Tax benefit from stock option exercises	(0.3)		(1.2)		(0.3)		(1.2)
Expiration of the statute of limitations	(2.6	)	(0.8	)	(0.9	)	(0.3	)

Other, net	(0.9	)	(0.8	)	(0.7	)	(0.7	)	Other, net	(0.3)		(0.6)		(0.3)		(0.4)
	27.7	%	33.8	%	30.2	%	34.7	%		23.1	%	22.3	%	23.1	%	22.5	%

The ~~decrease~~increase in ~~our~~the effective tax ~~rates for~~rate in the three and ~~nine months ended September 30, 2017~~six month periods was primarily due to ~~the adoption of ASU 2016-09. Under this standard, we no longer record excess~~decreased tax benefits ~~from~~related to the lower volume of stock option exercises ~~as an increase~~in 2022 compared to ~~additional paid~~the prior year period.

Stock-Based Compensation

We recognized $20.6 million and $19.9 million in ~~capital, but record such excess tax benefits as~~stock-based compensation expense during the six months ended June 30, 2022 and 2021, respectively. The amount of stock-based compensation expense we recognize is primarily based upon management's estimate of when the financial vesting targets of outstanding stock options may be achieved. Any change in the estimate could result in the amount of stock-based compensation expense to be accelerated, spread out over a ~~reduction~~longer period, or reversed. This may cause volatility in the recognition of ~~income tax~~stock-based compensation expense in future periods and could materially affect earnings.

We revised our estimate of when some vesting targets are expected to be achieved. This change in estimate resulted in a decrease of $663 thousand in stock-based compensation expense during the reporting period in which the exercises occur. At each interim reporting period, the cumulative stock option exercise activity is remeasured against year to date net income, resulting in an adjustment to the effect from excess tax benefits on our quarterly tax rate. Consequently, our effective tax rate could fluctuate significantly on a quarterly basis due to the tax effects of stock-based compensation. The decrease in our tax rates for the three and ninesix months ended ~~September~~June 30, ~~2017 was also due~~2022. We expect to recognize $18.6 million in stock-based compensation expense during the ~~expiring statute~~remainder of ~~limitations pertaining to various federal tax items.~~2022.

Fair Value Measurements

The fair value of ~~our~~ financial assets and liabilities, except for the investment funds sponsored by LSV, is determined in accordance with the fair value hierarchy. The fair value of the investment funds sponsored by LSV is measured using the net asset value per share (NAV) as a practical expedient. The fair value of all other financial assets are determined using Level 1 or Level 2 inputs and consist mainly of investments in equity or fixed-income mutual funds that are quoted daily and Government National Mortgage Association (GNMA) and other U.S. government agency securities that are single issuer pools that are valued based on current market data of similar assets. ~~Our~~ Level 3 financial liabilities at ~~September~~June 30, ~~2017~~2022 and December 31, 2021 consist entirely of the estimated contingent consideration ~~of $4.8 million~~ resulting from ~~the~~an acquisition ~~of Archway~~ (See Note 1412 to the Notes to Consolidated Financial Statements ). We did not have any financial liabilities at December 31, 2016 that were required to be measured at fair value on a recurring basis (See Note 5 to the Notes to Consolidated Financial Statements).

~~33 of 42~~

Regulatory Matters

Like many firms operating within the financial services industry, we are experiencing a ~~difficult~~complex and changing regulatory environment across our markets. Our current scale and reach as a provider to the financial services industry, the introduction and implementation of new solutions for our financial services industry clients, the increased regulatory oversight of the financial services industry generally, new laws and regulations affecting the financial services industry and ever-changing regulatory interpretations of existing laws and regulations, and a greater propensity of regulators to pursue enforcement actions and other sanctions against regulated entities, have made this an increasingly challenging and costly regulatory environment in which to operate.

SEI and some of our regulated subsidiaries have undergone or been scheduled to undergo a range of periodic or thematic reviews, examinations or investigations by numerous regulatory authorities around the world, including the Office of the Comptroller of the Currency, the Securities and Exchange Commission, the Financial Industry Regulatory Authority, ~~Inc.,~~ the Financial Conduct Authority of the United Kingdom (FCA), the Central Bank of Ireland and others. These regulatory activities typically result in the identification of matters or practices to be addressed by us or our subsidiaries and, in certain circumstances, the regulatory authorities require remediation activities or pursue enforcement proceedings against

us or our subsidiaries. From time to time, the regulators in different jurisdictions will elevate their level of scrutiny of our operations as our business expands or is deemed critical to the operations of the relevant financial markets. As described under the caption “Regulatory Considerations” in our Annual Report on Form 10-K, the range of possible sanctions that are available to regulatory authorities include limitations on our ability to engage in business for specified periods of time, the revocation of registration, censures and fines. The direct and indirect costs of responding to these regulatory activities and of complying with new or modified regulations, as well as the potential financial costs and potential reputational impact against us of any enforcement proceedings that might result, is uncertain but could have a material adverse impact on our operating results or financial position.

~~Foreign Currency Exchange Rates~~

We transact business in the local currencies of various foreign countries, principally the United Kingdom, Canada and Ireland. The total of all of our foreign operations in these countries accounted for approximately nine percent of our total consolidated revenues for the nine months ended September 30, 2017. Also, most of our foreign operations match local currency revenues with local currency costs. We translate sales and other results denominated in foreign currency into U.S. dollars for our consolidated financial statements. During periods of a strengthening dollar, our reported international sales and earnings could be reduced because foreign currencies may translate into fewer U.S. dollars. A fluctuation of currency exchange rates may expose us to gains and losses on non-U.S. currency transactions and a potential devaluation of the local currencies relative to the U.S. dollar which may impair our revenue growth and operating profits and also prolong sales cycles with potential customers. We currently do not engage in any foreign currency hedging strategies. The percentages of our total consolidated revenues and expenses during the nine months ended September 30, 2017 transacted in British pound, Canadian dollar and Euro currencies were as follows:



	~~Nine Months Ended~~
	~~September 30, 2017~~
~~British pound~~
~~Total revenues~~	5%
~~Total expenses~~	6%

~~Canadian dollar~~
~~Total revenues~~	3%
~~Total expenses~~	5%

~~Euro~~
~~Total revenues~~	1%
~~Total expenses~~	2%

~~Acquisition of Archway Technology Partners, LLC~~

On July 3, 2017, we acquired Archway Technology Partners, LLC (Archway), a provider of operating technologies and services to the family office industry, for $81.5 million in cash consideration with up to an additional $8.0 million payable to the seller as a contingent purchase price with respect to two one-year periods ending December 31, 2017 and 2018 depending upon whether Archway achieves specified financial measures during such periods. The results of operations of Archway are included in the Investment Managers business segment (See Note 14 to the Notes to Consolidated Financial Statements).

~~34 of 42~~

~~SEI Wealth Platform - Estimated Useful Life~~

The SEI Wealth Platform, our next-generation wealth management processing solution, combines business service processing with asset management distribution services and serves as an operating platform for the Private Banks and Investment Advisors business segments. The initial version of the Platform was placed into service in July 2007 with an estimated useful life of 15 years. All significant enhancements to the Platform are currently amortized over the remaining useful life and would be fully expensed by June 2022 under this original estimate.

The majority of our recent development efforts to the Platform stem from our strategic decision to expand the SEI Wealth Platform offering utilizing two business models to serve different types of clients in the wealth management marketplace. The Full-Service Outsourcing solution will include client acquisition, portfolio management, enrollment and a unified product catalog that contains a single location for all of the client’s investment products used to construct model portfolios as well as enabling the Investment Advisors business segment to enter into the flexible turn-key asset management platform (TAMP) market, enabling clients to include third-party funds, ETFs, stocks, bonds and alternative investments into portfolios that are not currently available. For larger firms that are not interested in the Full-Service Outsourcing Solution, the Platform will be offered as a Software-as-a-Service (SaaS) solution. This solution will target the large bank marketplace and is expected to create significant revenue and cash flow opportunity. We believe both offerings have received market acceptance as evidenced by the signing of Wells Fargo Bank (Wells Fargo) for the SaaS solution and the signing and installation of Regions Bank (Regions) for the Full-Service Outsourcing solution.

Significant testing of enhancements to both solutions involved the combined effort between us and the clients. This included, but was not limited to, numerous Model Office Trials directed at testing the specific capabilities and enhancements of the Platform. The testing of the Full-Service Outsourcing solution capabilities of the Platform prior to the “go-live” date for the Regions conversion was successfully completed. In addition, the technical and business validation of the configuration and data migration for the conversion of the entire Wells Fargo wealth management business is currently in progress and meeting expectations. In early October 2017, Regions began operating on the Platform in a live environment and we completed our largest conversion of Investment Advisors segment clients to date.

The Platform provides an enabling technology platform for our businesses and clients for the future and was built using mainstream technologies using market-leading vendors. It is our expectation that the operating system, the database operating platform and the software programming language which comprise the underlying architecture will allow it to adapt to both market changes and technology changes over time. We believe the breadth of the services offered through the Platform provide us an advantage over our competitors. These services are core functions to the global financial services industry regardless of current market conditions. The global financial services industry is highly regulated and demand for the capabilities of the Platform is only expected to increase.

As a result of these circumstances, we are currently reassessing the remaining useful life of certain components and functionality of the Platform and expect to extend the remaining estimated useful life. Based upon our initial assessment, we estimate amortization expense related to components and functionality of the Platform currently in use as of September 30, 2017 of $256.3 million will decrease by approximately $3.0 million to $5.0 million per quarter beginning in the fourth quarter 2017. This estimate does not include our software development costs in-progress associated with future releases of the Platform of $27.3 million as of September 30, 2017. The release date for these capitalized software development costs in-progress has not yet been determined.

Liquidity and Capital Resources

Nine Months Ended September 30,
2017 2016
Net cash provided by operating activities $ 316,384
$ 289,434
Net cash used in investing activities (148,063 ) (67,060 )
Net cash used in financing activities (193,730 ) (274,342 )
Effect of exchange rate changes on cash and cash equivalents 14,679
(4,531 )
Net decrease in cash and cash equivalents (10,730 ) (56,499 )
Cash and cash equivalents, beginning of period 695,701
679,661
Cash and cash equivalents, end of period $ 684,971
$ 623,162

~~Cash requirements and liquidity needs are primarily funded through our cash flow from operations and our capacity for additional borrowing. At~~ ~~September 30, 2017, our unused sources of liquidity consisted of cash and cash equivalents and the amount available under our credit facility.~~

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	Six Months Ended June 30,
	2022		2021
Net cash provided by operating activities	$	330,615	$	324,997
Net cash used in investing activities	(42,516)		(56,087)
Net cash used in financing activities	(332,173)		(277,936)
Effect of exchange rate changes on cash, cash equivalents and restricted cash	(15,660)		2,578
Net decrease in cash, cash equivalents and restricted cash	(59,734)		(6,448)
Cash, cash equivalents and restricted cash, beginning of period	831,758		787,727
Cash, cash equivalents and restricted cash, end of period	$	772,024	$	781,279

Our credit facility provides for borrowings of up to ~~$300.0~~$325.0 million and is scheduled to expire in ~~June 2021~~April 2026 (See Note 76 to the Consolidated Financial Statements). In November 2021, we borrowed $40.0 million under the credit facility for the funding of an acquisition (See Note 12 to the Consolidated Financial Statements). We made principal payments of $40.0 million during the six month period ended June 30, 2022 to fully repay the outstanding balance of the credit facility.

As of July 15, 2022, we had outstanding letters of credit of $6.0 million which reduced the amount available under the credit facility. These letters of credit were primarily issued for the expansion of the corporate headquarters and are due to expire in late 2022. As of July 15, 2022, the amount of the credit facility available for corporate purposes was $319.0 million.

The availability of the credit facility is subject to compliance with certain covenants set forth in the agreement. The credit facility contains covenants which restrict our ability to engage in ~~mergers, consolidations, asset sales, investments,~~ transactions with affiliates other than wholly-owned subsidiaries or to incur liens or certain types of indebtedness as defined in the agreement. In the event of a default under the credit facility, we would also be restricted from paying dividends on, or repurchasing, our common stock. Currently, our ability to borrow from the credit facility is not limited by any covenant of the ~~agreement. In July 2017, we borrowed $40.0 million under the credit facility for the acquisition of Archway~~agreement (See Note 146 to the Consolidated Financial Statements). ~~We made~~

The credit facility contains terms that utilize the London InterBank Offered Rate (LIBOR) as a ~~principal payment of $10.0 million during October 2017. As of October 19, 2017, the amount~~potential component of the ~~credit facility available~~interest rate to be applied to any borrowings; however, an alternative reference rate is included under the agreement which provides for ~~corporate purposes was $270.0 million.~~a specified replacement rate upon a LIBOR cessation event. At the time of a LIBOR cessation event, the replacement rate, the Secured Overnight Financing Rate (SOFR), self-executes without the need for negotiations or a formal amendment process.

The majority of ~~our~~ excess cash reserves are primarily placed in accounts located in the United States that invest entirely in SEI-sponsored money market mutual funds denominated in the U.S. dollar. We also utilize demand deposit accounts or money market accounts at several well-established financial institutions located in the United States. Accounts used to manage these excess cash reserves do not impose any restrictions or limitations that would prevent us from being able to access such cash amounts immediately. As of ~~October 19, 2017,~~July 15, 2022, the amount of cash and cash equivalents considered free and immediately accessible for other general corporate purposes was ~~$284.9~~$386.2 million.

~~Our cash~~Cash and cash equivalents include accounts managed by ~~our~~ subsidiaries that are used in their operations or to cover specific business and regulatory requirements. The availability of this cash for other purposes beyond the operations of these subsidiaries may be limited. Also, some of our foreign subsidiaries may have excess cash reserves which are considered to be undistributed earnings and indefinitely reinvested. Upon distribution of these earnings, in the form of dividends or otherwise, we would be immediately subject to both U.S. and foreign withholding taxes which would reduce the amount we would ultimately realize. In addition to the foreign withholding taxes, the negative impact resulting from unfavorable exchange rate fluctuations on the cash balances held by our foreign subsidiaries would also reduce the amount realized. We therefore do not include accounts of ~~our~~ foreign subsidiaries in ~~our~~the calculation of free and immediately accessible cash for other general corporate purposes. A portion of the undistributed earnings of foreign subsidiaries are deemed repatriated. Any subsequent transfer of available cash related to the repatriated earnings of foreign subsidiaries could significantly increase free and immediately accessible cash.

Cash flows from operations increased ~~$27.0~~$5.6 million in the first ~~nine~~six months of ~~2017~~2022 compared to the first ~~nine~~six months of ~~2016~~2021 primarily from the increase in ~~our~~ net ~~income and higher distribution payments received from our unconsolidated affiliate, LSV.~~income. The ~~increase was partially offset by the~~ negative impact from the ~~timing of collections of receivables.~~change in the Company's working capital accounts partially offset the increase in cash flows from operations.

~~Cash flows used in investing activities increased $81.0 million in the first~~

~~nine~~

~~months of 2017 compared to the first~~

~~nine~~
~~months of 2016.~~

Net cash used in investing activities includes:


•	~~Cash paid for acquisition, net of cash acquired.~~ ~~We completed the acquisition of Archway on July 3, 2017. The purchase price paid included~~ ~~$81.5 million~~ ~~in cash consideration; however, we acquired~~ ~~$1.4 million~~ ~~in cash during the transaction for a net cash payment of~~ ~~$80.1 million~~ ~~(See Note 14 to the Consolidated Financial Statements).~~

•Purchases, sales and maturities of marketable securities. ~~Our purchases,~~Purchases, sales and maturities of marketable securities in the first ~~nine~~six months of ~~2017~~2022 and ~~2016~~2021 were as follows:


	Nine Months Ended September 30,							Six Months Ended June 30,
	2017			2016				2022		2021
Purchases	$	(50,235	)	$	(55,162	)	Purchases	$	(96,642)	$	(81,541)
Sales and maturities	52,644			43,850			Sales and maturities	90,659		64,194
Net investing activities from marketable securities	$	2,409		$	(11,312	)	Net investing activities from marketable securities	$	(5,983)	$	(17,347)

•

~~The capitalization of costs incurred in developing computer software.~~ ~~We capitalized $40.6~~

See Note 5 to the Consolidated Financial Statements for more information related to marketable securities.

•The capitalization of costs incurred in developing computer software. We capitalized $13.8 million of software development costs in the first nine months of 2017 as compared to $27.4 million in the first nine months of 2016 for significant enhancements for the expanded functionality of the SEI Wealth Platform. Additionally, we also capitalized $8.0 million and $5.8 million of software development costs in the first nine months of 2017 and 2016, respectively, for a new application for the Investment Managers segment. The application is expected to be placed into service during the first quarter of 2018 and have an estimated useful life of five years.


•	~~Capital expenditures.~~ ~~Our capital expenditures in the first~~ ~~nine~~ ~~months of 2017 were $20.3 million as compared to $26.7 million in the first~~ ~~nine~~ ~~months of~~ ~~2016. Our expenditures in~~ ~~2017~~ ~~and 2016 primarily include purchased software and equipment for our data center operations.~~

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~~Cash flows used in financing activities decreased~~ ~~$80.6 million~~ in the first ~~nine~~six months of ~~2017~~2022 as compared to $12.3 million in the first ~~nine~~six months of 2021. The majority of our software development costs are related to significant enhancements for the expanded functionality of the SEI Wealth Platform.

•~~2016~~Capital expenditures.. Capital expenditures in the first six months of 2022 were $19.8 million as compared to $15.5 million in the first six months of 2021. Expenditures in 2022 and 2021 include capital outlays for purchased software and equipment for data center operations. We continue to evaluate improvements to our information technology infrastructure which, if implemented, will result in additional expenditures for purchased software and equipment for data center operations.

Net cash used in financing activities includes:

•Principal repayments on revolving credit facility. In November 2021, we borrowed $40.0 million for the funding of an acquisition. We made principal payments of $40.0 million during the first six months of 2022 to fully repay the outstanding balance of the credit facility.


•	~~Borrowings on revolving credit facility.~~ In July 2017, we borrowed $40.0 million for the funding of the acquisition of Archway. We made a principal payment of $10.0 million during October 2017 and intend to repay the entire outstanding balance during 2018 (See Note 7 to the Consolidated Financial Statements).

•

~~The repurchase of our common stock.~~ Our Board of Directors has authorized the repurchase of our common stock through multiple authorizations. Currently, there is no expiration date for our common stock repurchase program. We had total capital outlays of ~~$186.5 million~~ ~~during the first~~ ~~nine~~ ~~months of~~ ~~2017~~ ~~and~~ ~~$224.8 million~~ ~~during the first~~ ~~nine~~ ~~months of~~ ~~2016~~ ~~for the repurchase of our common stock.~~


•	~~Proceeds from the issuance of our common stock.~~ ~~We received~~ ~~$41.6 million~~ ~~in proceeds from the issuance of our common stock during the first~~ ~~nine~~ ~~months of~~ ~~2017~~ ~~as compared to~~ ~~$35.2 million~~ ~~during the first~~ ~~nine~~ ~~months of~~ ~~2016. The increase in proceeds is primarily attributable to a higher level of stock option exercise activity.~~


•	~~Dividend payments.~~ ~~Cash dividends paid were~~ ~~$88.9 million~~ ~~in the first~~ ~~nine~~ ~~months of~~ ~~2017~~ ~~as compared to $84.7 million in the first~~ ~~nine~~ ~~months of~~ ~~2016~~.

•The repurchase of common stock. Our Board of Directors has authorized the repurchase of common stock through multiple authorizations. Currently, there is no expiration date for the common stock repurchase program. We had total capital outlays of $210.3 million during the first six months of 2022 and $197.3 million during the first six months of 2021 for the repurchase of common stock.

•Proceeds from the issuance of common stock. We received $28.8 million in proceeds from the issuance of common stock during the first six months of 2022 and 2021. These proceeds were primarily from stock option exercise activity.

•Dividend payments. Cash dividends paid were $109.8 million in the first six months of 2022 as compared to $105.5 million in the first six months of 2021.

Cash Requirements

Cash requirements and liquidity needs are primarily funded through cash flow from operations and our capacity for additional borrowing. At June 30, 2022, unused sources of liquidity consisted of cash and cash equivalents and the amount available under our credit facility.

We are obligated to make payments in connection with the credit facility, operating leases, maintenance contracts and other commitments. We believe our operating cash flow, available borrowing capacity, and existing cash and cash equivalents ~~should~~will provide adequate funds for these obligations and ongoing ~~operations; continued investment in new products~~operations. We currently anticipate that our available funds and ~~equipment;~~cash flow from operations will be sufficient to meet our ~~common~~operational cash needs and fund our stock repurchase program for at least the next 12 months and ~~future dividend payments.~~

~~Off Balance Sheet Arrangement~~

~~On October 1, 2012, we provided an unsecured guaranty of~~for the obligations of LSV Employee Group III to The PrivateBank and Trust Company and certain other lenders. We entered into this agreement in order to facilitate the acquisition of certain partnership interests of LSV by LSV Employee Group III. In June 2017, LSV Employee Group III made the final principal payment and, therefore, the Company has no further obligation regarding the agreement. Additional information pertaining to the agreement is presented in Note 2 to the Consolidated Financial Statements.foreseeable future.

Forward-Looking Information and Risk Factors

The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for forward-looking statements. Certain information contained in this discussion is or may be considered forward-looking. Forward-looking statements relate to future operations, strategies, financial results or other developments. Forward-looking statements are based upon estimates and assumptions that involve certain risks and uncertainties, many of which are beyond our control or are subject to change. Although we believe our assumptions are reasonable, they could be inaccurate. Our actual future revenues and income could differ materially from our expected results. We have no obligation to publicly update or revise any forward-looking statements.

Among the risks and uncertainties which may affect our future operations, strategies, financial results or other developments are those risks described in our latest Annual Report on Form 10-K in Part I, Item 1A. These risks include the following:

•changes in capital markets that may affect our revenues and earnings;

•product development risk;

•risk of failure by a third-party service provider;

~~data and cyber security risks;~~

~~operational risks associated with the processing of investment transactions;~~

~~systems and technology risks;~~

•pricing pressure from increased competition, disruptive technology and poor investment performance;

•the affect on our earnings and cashflows from the performance of LSV Asset Management;

~~third party pricing services for~~•consolidation within our target markets;

•external factors affecting the ~~valuation~~fiduciary management market;

•software defects, development delays or installation difficulties, which would harm our business and reputation and expose us to potential liability;

•data and cyber security risks;

•risk of ~~securities invested~~the disclosure and misuse of personal data;

•risk of outages, data losses, and disruptions of services;

•intellectual property risks;

•third-party service providers in our operations;

•poor investment ~~products;~~performance of our investment products or a client preference for products other than those which we offer or for products that generate lower fees;

•investment advisory contracts which may be terminated or may not be renewed on favorable terms;

•operational risks associated with the processing of investment transactions;

•systems and technology risks;

•the affect of extensive governmental regulation;

•litigation and regulatory examinations and investigations;

~~consolidation within~~ •our ~~target markets, including consolidations between banks~~ability to capture the expected value from acquisitions, divestitures, joint ventures, minority stakes or strategic alliances;

•increased costs and regulatory risks from the growth of our business;

•fiduciary or other ~~financial institutions;~~legal liability for client losses from our investment management operations;

•our ability to receive dividends or other payments in needed amounts from our subsidiaries;

•the exit by the United Kingdom from the European Union;

~~third party approval~~•the effectiveness of our ~~investment products with advisors affiliated with independent broker-dealers or other networks;~~business, risk management and business continuity strategies, models and processes;

•financial and non-financial covenants which may restrict our ability to manage liquidity needs;

•changes in, or interpretation of, accounting principles or tax rules and regulations;

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•fluctuations in foreign currency exchange rates;

•fluctuations in interest rates affecting the value of our fixed-income investment securities;

•our ability to hire and retain qualified employees;

•the competence and integrity of our employees and third-parties;

•stockholder activism efforts;

•retention of executive officers and senior management ~~personnel.~~personnel;

~~Our principal,~~•unforeseen or catastrophic events, including the emergence of pandemic, extreme weather events or other natural disasters; and

•geopolitical unrest and other events.

We conduct operations through many regulated wholly-owned subsidiaries. These subsidiaries ~~are~~ include:

•SEI Investments Distribution Co., or SIDCO, ~~SEI Investments Management Corporation, or SIMC, SEI Private Trust Company, or SPTC, SEI Trust Company, or STC, and SEI Investments (Europe) Limited, or SIEL. SIDCO is~~ a broker-dealer registered with the SEC under the Securities ~~and~~ Exchange Act of 1934 and is a member of the Financial Industry Regulatory Authority, Inc., or FINRA;

•SEI Investments Management Corporation, or SIMC, is an investment advisor registered with the SEC under the Investment Advisers Act of 1940 and with the Commodity Futures Trading Commission, or CFTC, under the Commodity ~~Futures~~ Exchange ~~Act.~~Act;

•SEI Private Trust Company, or SPTC, is a limited purpose federal thrift chartered and regulated by the Office of the Comptroller of the ~~Currency.~~Currency;

•SEI Trust Company, or STC, is a Pennsylvania trust company, regulated by the Pennsylvania Department of Banking and ~~Securities.~~Securities;

•SEI Institutional Transfer Agent, Inc., or SITA, a transfer agent registered with the SEC under the Securities Exchange Act of 1934;

•SEI Investments (Europe) Limited, or SIEL, is an investment manager and financial institution subject to regulation by the Financial Conduct Authority of the United ~~Kingdom.~~ Kingdom;

•SEI Investments Canada Company, or SEI Canada, an investment fund manager that has various other capacities that is regulated by the Ontario Securities Commission and various provincial authorities;

•SEI Investments Global, Limited, or SIGL, a management company for Undertakings for Collective Investment in Transferable Securities, or UCITS, and for Alternative Investment Funds, or AIFs, that is regulated primarily by the Central Bank of Ireland, or CBI;

•SEI Investments - Global Fund Services, Ltd., or GFSL, an authorized provider of administration services for Irish and non-Irish collective investment schemes that is regulated by the CBI;

•SEI Investments - Depositary and Custodial Services (Ireland) Limited, or D&C, an authorized provider of depositary and custodial services that is regulated by the CBI;

•SEI Investments - Luxembourg S.A., or SEI Lux, a professional of the specialized financial sector subject to regulation by the Commission de Surveillance du Secteur Financier of the Grand Duchy of Luxembourg;

•SEI Investments Global (Cayman), Ltd., a full mutual fund administrator that is regulated by the Cayman Island Monetary Authority; and

•SEI Investments (South Africa) (PTY) Limited, a Private Company that is a licensed Financial Service Provider regulated by the Financial Sector Conduct Authority.

In addition ~~various SEI~~to the regulatory authorities listed above, our subsidiaries are subject to the jurisdiction of regulatory authorities in ~~Canada, the Republic of Ireland and~~ other foreign countries. ~~The Company has~~In addition to our wholly-owned subsidiaries, we also own a minority ~~ownership~~ interest of approximately 38.6% in LSV, which is also an investment advisor registered with the SEC.

The Company, its regulated subsidiaries, their regulated services and solutions and their customers are all subject to extensive legislation, regulation, and supervision that recently has been subject to, and continues to experience, significant change and increased regulatory activity. These changes and regulatory activities could have a material adverse ~~affect~~effect on us and our clients.

The various governmental agencies and self-regulatory authorities that regulate or supervise the Company and ~~various of~~ its subsidiaries have broad administrative powers. In the event of a failure to comply with laws, regulations, and requirements of these agencies and authorities, the possible business process changes required or sanctions that may be imposed include the suspension of individual employees, limitations on our ability to engage in business for specified periods of time, the revocation of applicable registration as a broker-dealer, investment advisor or other regulated entity, and, as the case may be, censures and fines. Additionally, certain securities and banking laws applicable to us and our subsidiaries provide for certain private rights of action that could give rise to civil litigation. Any litigation could have significant financial and non-financial consequences including monetary judgments and the requirement to take action or limit activities that could ultimately affect our business.

Governmental scrutiny from regulators, legislative bodies, and law enforcement agencies with respect to matters relating to our regulated subsidiaries and their activities, services and solutions, our business practices, our past actions and other matters has increased dramatically in the past several years. Responding to these examinations, investigations, actions, and lawsuits, regardless of the ultimate outcome of the proceeding, is time consuming and expensive and can divert the time and effort of our senior management from our business. Penalties, fines and ~~fines~~changes to business processes sought by regulatory authorities have increased substantially over the last several years, and certain regulators have been more likely in recent years to commence enforcement actions or to advance or support legislation targeted at the financial services industry. We continue to be subject to inquiries from examinations and investigations by supervisory and enforcement divisions of regulatory authorities and expect this to continue in the future. We believe this is also the case with many of our regulated clients. Governmental scrutiny and legal and enforcement proceedings can also have a negative impact on our reputation, our relationship with clients and prospective clients, and on the morale and performance of our employees, which could adversely affect our businesses and results of operations.

We are subject to ~~the USA PATRIOT Act of 2001, which contains~~U.S. and foreign anti-money laundering and financial transparency laws ~~and requires~~that require implementation of regulations applicable to financial services companies, including standards for verifying client identification and monitoring client transactions and detecting and reporting suspicious activities. ~~Anti-money laundering laws outside the United States contain similar requirements.~~ We offer investment and banking solutions that also are subject to regulation by the federal and state securities and banking authorities, as well as foreign regulatory

authorities, where applicable. Existing or future regulations that affect these solutions could lead to a reduction in sales of these solutions or require modifications of these solutions.

We must comply with economic sanctions and embargo programs administered by the Office of Foreign Assets Control (OFAC) and similar national and multinational bodies and governmental agencies outside the United States, as well as anti-corruption and anti-money laundering laws and regulations throughout the world. We can incur higher costs and face greater compliance risks in structuring and operating our businesses to comply with these requirements. Furthermore, a violation of a sanction or embargo program or anti-corruption or anti-money laundering laws and regulations could subject us and our subsidiaries, and individual employees, to regulatory enforcement actions as well as significant civil and criminal penalties.

Our businesses are also subject to privacy and data protection information security legal requirements concerning the use and protection of certain personal information. These include those adopted pursuant to the Gramm-Leach-Bliley Act and the Fair and Accurate Credit Transactions Act of 2003 in the United States, the General Data Protection Regulation (GDPR) in the EU, Canada’s Personal Information Protection and Electronic Documents Act, the Cayman Islands' Data Protection Law, and various other laws. Privacy and data security legislation is a priority issue in many states and localities in the United States, as well as foreign jurisdictions outside of the EU. For example, California enacted the California Consumer Privacy Act (CCPA) which broadly regulates the sale of the consumer information of California residents and grants California residents certain rights to, among other things, access and delete data about them in certain circumstances. Other states are considering similar proposals. Such attempts by the states to regulate have the potential to create a patchwork of differing and/or conflicting state regulations. Ensuring compliance under ever-evolving privacy legislation, such as GDPR and CCPA, is an ongoing commitment, which involves substantial costs.

Compliance with existing and future regulations and responding to and complying with recent increased regulatory activity affecting broker-dealers, investment advisors, investment companies, financial institutions, and their service providers could have a significant impact on us. We periodically undergo regulatory examinations and respond to regulatory inquiries ~~challenges,~~ and document requests. In addition, recent and continuing legislative activity in the United States ~~(including the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 and attendant rule making activities)~~ and in other jurisdictions (including the European Union and the United ~~Kingdom and the Republic of Ireland)~~Kingdom) have made and continue to make extensive changes to the laws regulating financial services firms. As a result of these examinations, inquiries, and requests, as a result of increased civil litigation activity, and as a result of these new laws and regulations, we engage legal counsel and other subject matter experts, review our compliance procedures, solution and service offerings, and business operations, and make changes as we deem ~~necessary.~~necessary or as may be required by the applicable authority. These additional activities and required changes may result in increased expense or may reduce revenues.

Our bank clients are subject to supervision by federal, state, and ~~state~~foreign banking and financial services authorities concerning the manner in which such clients purchase and receive our products and services. Our plan sponsor clients and our subsidiaries providing services to those clients

~~38 of 42~~

are subject to supervision by the Department of Labor and compliance with employee benefit regulations. Investment advisor and broker-dealer clients are regulated by the SEC, state securities authorities, or FINRA. Existing or future regulations applicable to our clients may affect our clients’ purchase of our products and services.

In addition, see the discussion of governmental regulations in Item 1A “Risk Factors” in our latest Annual Report on Form 10-K for a description of the risks that the current regulatory regimes and proposed regulatory changes may present for our business.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Information required by this item is set forth under the captions "Our revenues and earnings are affected by changes in capital ~~markets"~~markets and significant changes in the value of financial instruments" and "Changes in interest rates may affect the value of our fixed-income investment securities" in Item 1A ~~"Risk Factors"~~Risk Factors and under the caption ~~"Sensitivity~~"Impact of ~~our revenues and earnings to capital market fluctuations"~~COVID-19" in Item 7, ~~"Management's~~Management's Discussion and Analysis of Financial Condition and Results of ~~Operations"~~Operations of our Annual Report on Form 10-K for the year ended December 31, ~~2016~~.2021. There have been no material changes to this information as it is disclosed in our Annual Report on Form 10-K for ~~2016~~.2021.

Item 4. Controls and Procedures.

(a) Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures as of the end of the period covered by this report are effective in ensuring that information required to be disclosed by us in reports filed under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the

time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Act is accumulated and communicated to the issuer’s management including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. A controls system, no matter how well designed and operated, cannot provide absolute assurance that the objectives of the controls systems are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected.

(b) Change in Internal Control over Financial Reporting

No change in our internal control over financial reporting occurred during the quarter ended ~~September~~June 30, ~~2017~~2022 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

~~39 of 42~~

PART II. OTHER INFORMATION

Item 1. Legal Proceedings.

~~SEI has been named in seven lawsuits filed in Louisiana courts; four~~We and certain of ~~the cases also name SPTC as~~our subsidiaries are a ~~defendant. The underlying allegations in all actions relate~~party to ~~the purported role of SPTC in providing back-office services~~or have property subject to ~~Stanford Trust Company. The complaints allege~~litigation and other proceedings, examinations and investigations that ~~SEI and SPTC participated in some manner~~arise in the ~~sale~~ordinary course of ~~“certificates~~our business that we do not believe are material. These types of ~~deposit” issued by Stanford International Bank so as to be a “seller” of~~matters could result in fines, penalties, cost reimbursements or contributions, compensatory or treble damages or non-monetary sanctions or relief. We believe the ~~certificates of deposit for purposes of primary liability under the Louisiana Securities Law or so as to be secondarily liable under~~probability is remote that statute for sales of certificates of deposit made by Stanford Trust Company. Two of the actions also include claims for violations of the Louisiana Racketeering Act and possibly conspiracy, and a third also asserts claims of negligence, breach of contract, breach of fiduciary duty, violations of the uniform fiduciaries law, negligent misrepresentation, detrimental reliance, violations of the Louisiana Racketeering Act, and conspiracy.

~~The procedural status of the seven cases varies. The~~ ~~Lillie~~ case, filed originally in the 19th Judicial District Court for the Parish of East Baton Rouge, was brought as a class action and is procedurally the most advanced of the cases. SEI and SPTC filed exceptions, which the Court granted in part, dismissing claims under the Louisiana Unfair Trade Practices Act and permitting the claims under the Louisiana Securities Law to go forward. On March 11, 2013, newly-added insurance carrier defendants removed the case to the United States District Court for the Middle District of Louisiana. On August 7, 2013, the Judicial Panel on Multidistrict Litigation transferred the matter to the Northern District of Texas where MDL 2099, ~~In re: Stanford Entities Securities Litigation~~ (“the Stanford MDL”), is pending. On September 22, 2015, the District Court on the motion of SEI and SPTC dismissed plaintiffs’ claims for primary liability under Section 714(A) of the Louisiana Securities Law, but declined to dismiss plaintiffs’ claims for secondary liability under Section 714(B) of the Louisiana Securities Law based on the allegations pled by plaintiffs. On November 4, 2015, the District Court granted SEI and SPTC's motion to dismiss plaintiffs' claims under Section 712(D) of the Louisiana Securities Law. Consequently, the only claims of plaintiffs still pending before the District Court in ~~Lillie~~ are plaintiffs' claims for secondary liability against SEI and SPTC under Section 714(B) of the Louisiana Securities Law. On May 2, 2016, the District Court certified the class as being "all persons for whom Stanford Trust Company purchased or renewed Stanford Investment Bank Limited certificates of deposit in Louisiana between January 1, 2007 and February 13, 2009". Notice of the pendency of the class action was mailed to potential class members on October 4, 2016.

~~The plaintiffs in two of the cases remaining in the Parish of East Baton Rouge have granted SEI and SPTC indefinite extensions to respond to the petitions.~~

~~In the two additional cases, filed in East Baton Rouge and brought by the same counsel who filed the~~ ~~Lillie~~ action, virtually all of the litigation to date has involved motions practice and appellate litigation regarding the existence of federal subjection matter jurisdiction under the federal Securities Litigation Uniform Standards Act (SLUSA). After the matter was removed to the United States District Court for the Northern District of Texas, that court dismissed the action under SLUSA. The Court of Appeals for the Fifth Circuit reversed that order, and the Supreme Court of the United States affirmed the Court of Appeals judgment on February 26, 2014. The matter was remanded to state court and no material activity has taken place since that date.

~~While~~ the outcome of ~~this litigation remains uncertain,~~any of these matters will have a material adverse effect on SEI ~~and SPTC believe~~as a whole, notwithstanding that ~~they~~the unfavorable resolution of any matter may have ~~valid defenses to plaintiffs' claims and intend to defend the lawsuits vigorously. Because of uncertainty~~a material effect on our net earnings in ~~the make-up of the~~ ~~Lillie~~ class, the specific theories of liability that may survive a motion for summary judgment or other dispositive motion, the relative lack of discovery regarding damages, causation, mitigation and other aspects that may ultimately bear upon loss, the Company is not reasonably able to provide an estimate of loss, if any ~~with respect to the foregoing lawsuits.~~

~~40 of 42~~

make premium payments. The plaintiffs seek to recover jointly and severally from nine defendants including GFSL and D&C, damages of approximately $84 million. GFSL and D&C’s involvement in the litigation appears to arise out of their historical provision of administration and custody services, respectively, to the Strategic Life Settlement Fund PLC, who, together with its managers, appear to be the principal defendants in this claim. On December 4, 2015, the Belgium court dismissed plaintiff's claims for a lack of jurisdiction. On December 22, 2015, the plaintiffs appealed the dismissal. During October 2017, the Belgium appellate court dismissed plaintiff's appeal.

~~While~~particular interim reporting period. We cannot predict the outcome of ~~this action is uncertain given its early phase~~legal or other proceedings with certainty. These matters include the proceedings summarized in “Note 11. Commitments and ~~the lack of specific theories of liability asserted against GFSL and D&C, each of GFSL and D&C believe that they have valid defenses~~Contingencies” included in our Notes to ~~plaintiffs’ claims and intend to defend the lawsuit vigorously, and GFSL and D&C are not reasonably able to provide an estimate of the ultimate loss, if any, with respect to this lawsuit.~~Consolidated Financial Statements.

Item 1A. Risk Factors.

Information regarding risk factors appears in Part I – Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2016~~.2021. There have been no material changes in ~~our~~the risk factors from those disclosed in ~~our~~the Annual Report on Form 10-K for ~~2016.~~2021.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

(e) Our Board of Directors has authorized the repurchase of up to $5.328 billion worth of our common stock through multiple authorizations. Currently, there is no expiration date for the common stock repurchase program. On June 1, 2022, the Board of Directors approved an increase in the stock repurchase program by an additional $200.0 million.

~~(e)~~

~~Our Board of Directors has authorized the repurchase of up to~~ ~~$3.478 billion~~ worth of our common stock through multiple authorizations. Currently, there is no expiration date for our common stock repurchase program. On October 24, 2017, our Board of Directors approved an increase in the stock repurchase program by an additional $200.0 million, increasing the available authorization to approximately $230.5 million.

Information regarding the repurchase of common stock during the three months ended ~~September~~June 30, ~~2017~~2022 is as follows:


Period	Total Number of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Program	Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program
April 2022	450,000	$	56.95	450,000	$	105,578,000
May 2022	750,000	55.30		750,000	64,105,000
June 2022	770,000	54.81		770,000	221,910,000
Total	1,970,000	$	55.48	1,970,000

Period
Total Number
of Shares
Purchased

Average
Price Paid
per Share

Total Number of
Shares Purchased as
Part of Publicly
Announced Program

Approximate Dollar
Value of Shares that
May Yet Be
Purchased
Under the Program
July 2017 25,000
$ 55.88
25,000
$ 97,291,000
August 2017 421,000
56.41
421,000
73,552,000
September 2017 735,000
58.60
735,000
30,476,000
Total 1,181,000
$ 57.76
1,181,000

Item 6. Exhibits.

The following is a list of exhibits filed as part of the Form 10-Q.




~~31.1~~10.1		Form of Restricted Stock Unit Grant Agreement with time-based vesting for employee awards under the Registrant's 2014 Omnibus Equity Compensation Plan.

31.1		Rule 13a-15(e)/15d-15(e) Certification of Chief Executive Officer.

31.2			Rule 13a-15(e)/15d-15(e) Certification of Chief Financial Officer.

32			Section 1350 Certifications.

~~99.1~~101.INS			~~Press release dated October 25, 2017 of SEI Investments Company related to the Company's financial and operating results for the third quarter ended September 30, 2017.~~

~~101.INS~~	XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

101.SCH			XBRL Taxonomy Extension Schema Document

101.CAL			XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF			XBRL Taxonomy Extension Definition Linkbase Document

101.LAB			XBRL Taxonomy Extension Label Linkbase Document

101.PRE			XBRL Taxonomy Extension Presentation Linkbase Document

~~41 of 42~~

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

SEI INVESTMENTS COMPANY

Date:

July 25, 2022

~~October 26, 2017~~

By:

~~By:~~

/s/ Dennis J. McGonigle

Dennis J. McGonigle

Chief Financial Officer

~~42 of 42~~



	At December 31, 2016
	Cost Amount		Gross Unrealized Gains		Gross Unrealized (Losses)			Fair Value
SEI-sponsored mutual funds	$	7,357	$	24	$	(996	)	$	6,385
Equities and other mutual funds	2,968		228		—			3,196
Debt securities	74,843		—		(391		)	74,452
	$	85,168	$	252	$	(1,387	)	$	84,033



	As of September 30,				Percent Change
	2017		2016		Percent Change
Private Banks:
Equity and fixed-income programs	$	21,196	$	18,668	14%
Collective trust fund programs	4		3		33%
Liquidity funds	3,345		4,034		(17)%
Total assets under management	$	24,545	$	22,705	8%
Client assets under administration	22,107		19,269		15%
Total assets	$	46,652	$	41,974	11%
Investment Advisors:
Equity and fixed-income programs	59,455		52,594		13%
Collective trust fund programs	5		5		—%
Liquidity funds	2,327		2,539		(8)%
Total assets under management	$	61,787	$	55,138	12%
Institutional Investors:
Equity and fixed-income programs	84,939		78,701		8%
Collective trust fund programs	82		90		(9)%
Liquidity funds	3,699		2,612		42%
Total assets under management	$	88,720	$	81,403	9%
Advised assets	4,450		—		NM
Total assets	93,170		81,403		14%
Investment Managers:
Equity and fixed-income programs	93		79		18%
Collective trust fund programs	46,087		35,962		28%
Liquidity funds	799		812		(2)%
Total assets under management	$	46,979	$	36,853	27%
Client assets under administration (A)	493,538		451,204		9%
Total assets	$	540,517	$	488,057	11%
Investments in New Businesses:
Equity and fixed-income programs	1,052		850		24%
Liquidity funds	71		53		34%
Total assets under management	$	1,123	$	903	24%
Advised assets	54		—		NM
Total assets	1,177		903		30%
LSV:
Equity and fixed-income programs	$	101,893	$	83,863	21%
Total:
Equity and fixed-income programs (B)	268,628		234,755		14%
Collective trust fund programs	46,178		36,060		28%
Liquidity funds	10,241		10,050		2%
Total assets under management	$	325,047	$	280,865	16%
Advised assets (C)	4,504		—		NM
Client assets under administration (D)	515,645		470,473		10%
Total assets under management, advisement and administration	$	845,196	$	751,338	12%