Document and Entity Information
Document and Entity Information | 9 Months Ended |
Jul. 31, 2019shares | |
Document and Entity Information [Abstract] | |
Document Type | 10-Q |
Document Quarterly Report | true |
Document Transition Report | false |
Document Period End Date | Jul. 31, 2019 |
Entity File Number | 1-8100 |
Entity Registrant Name | EATON VANCE CORP |
Entity Incorporation State Country Code | MD |
Entity Tax Identification Number | 04-2718215 |
Entity Address Address Line 1 | Two International Place |
Entity Address City Or Town | Boston |
Entity Address State Or Province | MA |
Entity Address Postal Zip Code | 02110 |
City Area Code | 617 |
Local Phone Number | 482-8260 |
Security 12b Title | Non-Voting Common Stock, $0.00390625 par value |
Trading Symbol | EV |
Security Exchange Name | NYSE |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity Filer Category | Large Accelerated Filer |
Entity Small Business | false |
Entity Emerging Growth Company | false |
Entity Shell Company | true |
Amendment Flag | false |
Current Fiscal Year End Date | --10-31 |
Document Fiscal Period Focus | Q3 |
Document Fiscal Year Focus | 2019 |
Entity Central Index Key | 0000350797 |
Voting Common Stock [Member] | |
Entity Common Stock Shares Outstanding | 422,935 |
Non-Voting Common Stock [Member] | |
Entity Common Stock Shares Outstanding | 113,042,392 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Jul. 31, 2019 | Oct. 31, 2018 |
Assets | ||
Cash and cash equivalents | $ 527,708 | $ 600,696 |
Management fees and other receivables | 234,146 | 236,736 |
Investments | 1,044,026 | 1,078,627 |
Assets of consolidated collateralized loan obligation (CLO) entities: | ||
Cash | 87,755 | 216,598 |
Bank loans and other investments | 1,706,350 | 874,304 |
Other assets | 21,983 | 4,464 |
Deferred sales commissions | 52,333 | 48,629 |
Deferred income taxes | 37,197 | 45,826 |
Equipment and leasehold improvements, net | 70,534 | 52,428 |
Intangible assets, net | 76,957 | 80,885 |
Goodwill | 259,681 | 259,681 |
Loan to affiliate | 5,000 | 5,000 |
Other assets | 95,195 | 95,454 |
Total assets | 4,218,865 | 3,599,328 |
Liabilities: | ||
Accrued compensation | 176,405 | 233,836 |
Accounts payable and accrued expenses | 78,504 | 91,410 |
Dividend payable | 50,676 | 51,731 |
Debt | 620,304 | 619,678 |
Liabilities of consolidated CLO entities: | ||
Senior and subordinated note obligations | 1,620,598 | 873,008 |
Other liabilities | 81,175 | 154,185 |
Other liabilities | 115,633 | 131,952 |
Total liabilities | 2,743,295 | 2,155,800 |
Commitments and contingencies (Note 17) | ||
Temporary Equity: | ||
Redeemable non-controlling interests | 346,163 | 335,097 |
Total temporary equity | 346,163 | 335,097 |
Permanent Equity: | ||
Additional paid-in capital | 0 | 17,514 |
Notes receivable from stock option exercises | (7,919) | (8,057) |
Accumulated other comprehensive loss | (59,935) | (53,181) |
Retained earnings | 1,195,775 | 1,150,698 |
Total Eaton Vance Corp. shareholders' equity | 1,128,365 | 1,107,431 |
Non-redeemable non-controlling interests | 1,042 | 1,000 |
Total permanent equity | 1,129,407 | 1,108,431 |
Total liabilities, temporary equity and permanent equity | 4,218,865 | 3,599,328 |
Voting Common Stock [Member] | ||
Permanent Equity: | ||
Common Stock | 2 | 2 |
Non-Voting Common Stock [Member] | ||
Permanent Equity: | ||
Common Stock | $ 442 | $ 455 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - $ / shares | Jul. 31, 2019 | Oct. 31, 2018 |
Voting Common Stock [Member] | ||
Consolidated Balance Sheets [Abstract] | ||
Common Stock, par value per share | $ 0.00390625 | $ 0.00390625 |
Common Stock Authorized | 1,280,000 | 1,280,000 |
Common Stock Outstanding | 422,935 | 422,935 |
Common Stock Issued | 422,935 | 422,935 |
Non-Voting Common Stock [Member] | ||
Consolidated Balance Sheets [Abstract] | ||
Common Stock, par value per share | $ 0.00390625 | $ 0.00390625 |
Common Stock Authorized | 190,720,000 | 190,720,000 |
Common Stock Outstanding | 113,042,392 | 116,527,845 |
Common Stock Issued | 113,042,392 | 116,527,845 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | |
Revenue: | ||||
Total revenue | $ 431,235 | $ 428,691 | $ 1,249,512 | $ 1,261,627 |
Expenses: | ||||
Compensation and related costs | 158,642 | 152,921 | 466,072 | 455,958 |
Distribution expense | 38,070 | 41,424 | 111,508 | 123,891 |
Service fee expense | 28,037 | 27,074 | 79,475 | 79,594 |
Amortization of deferred sales commissions | 5,644 | 4,637 | 16,762 | 13,342 |
Fund-related expenses | 9,715 | 9,253 | 29,320 | 27,773 |
Other expenses | 53,992 | 51,118 | 160,937 | 150,319 |
Total expenses | 294,100 | 286,427 | 864,074 | 850,877 |
Operating income | 137,135 | 142,264 | 385,438 | 410,750 |
Non-operating income (expense): | ||||
Gains and other investment income, net | 14,846 | 7,131 | 35,885 | 9,468 |
Interest expense | (5,888) | (5,906) | (17,907) | (17,716) |
Other income (expense) of consolidated CLO entities: | ||||
Gains and other investment income, net | 18,260 | 1,847 | 45,495 | 4,823 |
Interest and other expense | (21,748) | (3,092) | (40,905) | (3,630) |
Total non-operating income (expense) | 5,470 | (20) | 22,568 | (7,055) |
Income before income taxes and equity in net income of affiliates | 142,605 | 142,244 | 408,006 | 403,695 |
Income taxes | (36,304) | (37,219) | (100,998) | (119,880) |
Equity in net income of affiliates, net of tax | 2,235 | 2,750 | 6,918 | 8,877 |
Net income | 108,536 | 107,775 | 313,926 | 292,692 |
Net income attributable to non-controlling and other beneficial interests | (6,315) | (5,981) | (23,097) | (16,241) |
Net income attributable to Eaton Vance Corp. shareholders | $ 102,221 | $ 101,794 | $ 290,829 | $ 276,451 |
Earnings per share: | ||||
Basic | $ 0.94 | $ 0.89 | $ 2.63 | $ 2.40 |
Diluted | $ 0.90 | $ 0.83 | $ 2.54 | $ 2.24 |
Weighted average shares outstanding: | ||||
Basic | 109,111 | 114,610 | 110,553 | 115,157 |
Diluted | 113,464 | 122,741 | 114,510 | 123,553 |
Management fees [Member] | ||||
Revenue: | ||||
Total revenue | $ 375,747 | $ 368,961 | $ 1,085,881 | $ 1,086,894 |
Distribution and underwriter fees [Member] | ||||
Revenue: | ||||
Total revenue | 21,281 | 24,738 | 64,425 | 73,842 |
Service fees [Member] | ||||
Revenue: | ||||
Total revenue | 31,855 | 31,053 | 90,801 | 90,867 |
Other revenue [Member] | ||||
Revenue: | ||||
Total revenue | $ 2,352 | $ 3,939 | $ 8,405 | $ 10,024 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | |
Consolidated Statements of Comprehensive Income [Abstract] | ||||
Net income | $ 108,536 | $ 107,775 | $ 313,926 | $ 292,692 |
Other comprehensive income (loss): | ||||
Amortization of net losses on cash flow hedges, net of tax | (23) | (25) | (73) | (75) |
Unrealized gains (losses) on available-for-sale investments, net of tax | 0 | (1,027) | 0 | 5 |
Foreign currency translation adjustments | 1,703 | (4,585) | (2,967) | (2,566) |
Other comprehensive income (loss), net of tax | 1,680 | (5,637) | (3,040) | (2,636) |
Total comprehensive income | 110,216 | 102,138 | 310,886 | 290,056 |
Comprehensive income attributable to non-controlling and other beneficial interests | (6,315) | (5,981) | (23,097) | (16,241) |
Total comprehensive income attributable to Eaton Vance Corp. shareholders | $ 103,901 | $ 96,157 | $ 287,789 | $ 273,815 |
Consolidated Statements of Shar
Consolidated Statements of Shareholders' Equity - USD ($) $ in Thousands | Total | Common Stock [Member]Voting Common Stock [Member] | Common Stock [Member]Non-Voting Common Stock [Member] | Additional Paid-In Capital [Member] | Additional Paid-In Capital [Member]Voting Common Stock [Member] | Additional Paid-In Capital [Member]Non-Voting Common Stock [Member] | Notes Receivable From Stock Option Exercises [Member] | Notes Receivable From Stock Option Exercises [Member]Non-Voting Common Stock [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Retained Earnings [Member] | Retained Earnings [Member]Non-Voting Common Stock [Member] | Non-Redeemable Non-Controlling Interests [Member] | Total Permanent Equity [Member] | Total Permanent Equity [Member]Voting Common Stock [Member] | Total Permanent Equity [Member]Non-Voting Common Stock [Member] | Redeemable Non-Controlling Interests [Member] |
Beginning balance at Oct. 31, 2017 | $ 2 | $ 461 | $ 148,284 | $ (11,112) | $ (47,474) | $ 921,235 | $ 864 | $ 1,012,260 | $ 250,823 | |||||||
Net income | $ 292,692 | 276,451 | 2,241 | 278,692 | 14,000 | |||||||||||
Other comprehensive income (loss), net of tax | (2,636) | (2,636) | (2,636) | |||||||||||||
Dividends declared | (111,018) | (111,018) | ||||||||||||||
Issuance of Non-Voting Common Stock: | ||||||||||||||||
On exercise of stock options | 7 | $ 55,706 | $ (1,060) | $ 54,653 | ||||||||||||
Under employee stock purchase plans | 3,168 | 3,168 | ||||||||||||||
Under employee stock purchase incentive plan | 4,347 | 4,347 | ||||||||||||||
Under restricted stock plan, net of forfeitures | 6 | 6 | ||||||||||||||
Stock-based compensation | 67,299 | 67,299 | ||||||||||||||
Tax benefit (expense) associated with non-controlling interest | 2,030 | 2,030 | ||||||||||||||
Repurchase of Common Stock | (13) | $ (171) | (186,091) | $ (171) | (186,104) | |||||||||||
Principal repayments on notes receivable from stock option exercises | 2,829 | 2,829 | ||||||||||||||
Net subscriptions (redemptions/distributions) of non-controlling interest holders | (2,308) | (2,308) | 75,872 | |||||||||||||
Net consolidations (deconsolidations) of sponsored investment funds | (40,310) | |||||||||||||||
Reclass to temporary equity | 34 | 34 | (34) | |||||||||||||
Purchase of non-controlling interests | (8,439) | |||||||||||||||
Changes in redemption value of non-controlling interests redeemable at fair value | (17,033) | (17,033) | 17,033 | |||||||||||||
Ending balance at Jul. 31, 2018 | 2 | 461 | 78,214 | (9,343) | (50,110) | 1,086,145 | 831 | 1,106,200 | 308,945 | |||||||
Beginning balance at Apr. 30, 2018 | 2 | 466 | 124,814 | (9,376) | (44,473) | 1,021,041 | 853 | 1,093,327 | 335,301 | |||||||
Net income | 107,775 | 101,794 | 785 | 102,579 | 5,196 | |||||||||||
Other comprehensive income (loss), net of tax | (5,637) | (5,637) | (5,637) | |||||||||||||
Dividends declared | (36,690) | (36,690) | ||||||||||||||
Issuance of Non-Voting Common Stock: | ||||||||||||||||
On exercise of stock options | 0 | 6,127 | (285) | 5,842 | ||||||||||||
Under employee stock purchase plans | 1,619 | 1,619 | ||||||||||||||
Under employee stock purchase incentive plan | 998 | 998 | ||||||||||||||
Stock-based compensation | 22,791 | 22,791 | ||||||||||||||
Repurchase of Common Stock | (5) | $ (171) | (76,632) | $ (171) | (76,637) | |||||||||||
Principal repayments on notes receivable from stock option exercises | 318 | 318 | ||||||||||||||
Net subscriptions (redemptions/distributions) of non-controlling interest holders | (807) | (807) | 6,938 | |||||||||||||
Net consolidations (deconsolidations) of sponsored investment funds | (39,822) | |||||||||||||||
Changes in redemption value of non-controlling interests redeemable at fair value | (1,332) | (1,332) | 1,332 | |||||||||||||
Ending balance at Jul. 31, 2018 | 2 | 461 | 78,214 | (9,343) | (50,110) | 1,086,145 | 831 | 1,106,200 | 308,945 | |||||||
Cumulative effect adjustment upon adoption of new accounting standard | Accounting Standards Update 2016-09 [Member] | 675 | (523) | 152 | |||||||||||||
Beginning Balance, as adjusted | (56,895) | |||||||||||||||
Beginning balance at Oct. 31, 2018 | 1,108,431 | 2 | 455 | 17,514 | (8,057) | (53,181) | 1,150,698 | 1,000 | 1,108,431 | 335,097 | ||||||
Net income | 313,926 | 290,829 | 1,356 | 292,185 | 21,741 | |||||||||||
Other comprehensive income (loss), net of tax | (3,040) | (3,040) | (3,040) | |||||||||||||
Dividends declared | (120,051) | (120,051) | ||||||||||||||
Issuance of Non-Voting Common Stock: | ||||||||||||||||
On exercise of stock options | 3 | 23,400 | (534) | 22,869 | ||||||||||||
Under employee stock purchase plans | 3,199 | 3,199 | ||||||||||||||
Under employee stock purchase incentive plan | 1 | 4,201 | 4,202 | |||||||||||||
Under restricted stock plan, net of forfeitures | 7 | 7 | ||||||||||||||
Stock-based compensation | 67,967 | 67,967 | ||||||||||||||
Tax benefit (expense) associated with non-controlling interest | 929 | 929 | ||||||||||||||
Repurchase of Common Stock | (24) | (115,347) | $ (129,415) | (244,786) | ||||||||||||
Principal repayments on notes receivable from stock option exercises | 672 | 672 | ||||||||||||||
Net subscriptions (redemptions/distributions) of non-controlling interest holders | (1,342) | (1,342) | 59,448 | |||||||||||||
Net consolidations (deconsolidations) of sponsored investment funds | (67,994) | |||||||||||||||
Reclass to temporary equity | 28 | 28 | (28) | |||||||||||||
Purchase of non-controlling interests | (3,964) | |||||||||||||||
Changes in redemption value of non-controlling interests redeemable at fair value | (1,863) | (1,863) | 1,863 | |||||||||||||
Ending balance at Jul. 31, 2019 | 1,129,407 | 2 | 442 | (7,919) | (59,935) | 1,195,775 | 1,042 | 1,129,407 | 346,163 | |||||||
Beginning balance at Apr. 30, 2019 | 2 | 446 | (7,820) | (61,615) | 1,157,970 | 1,049 | 1,090,032 | 340,176 | ||||||||
Net income | 108,536 | 102,221 | 494 | 102,715 | 5,821 | |||||||||||
Other comprehensive income (loss), net of tax | 1,680 | 1,680 | 1,680 | |||||||||||||
Dividends declared | (39,626) | (39,626) | ||||||||||||||
Issuance of Non-Voting Common Stock: | ||||||||||||||||
On exercise of stock options | 1 | 11,371 | $ (286) | 11,086 | ||||||||||||
Under employee stock purchase plans | 1,606 | 1,606 | ||||||||||||||
Under employee stock purchase incentive plan | 1 | 812 | 813 | |||||||||||||
Stock-based compensation | 23,420 | 23,420 | ||||||||||||||
Tax benefit (expense) associated with non-controlling interest | (30) | (30) | ||||||||||||||
Repurchase of Common Stock | (6) | $ (36,460) | $ (24,790) | $ (61,256) | ||||||||||||
Principal repayments on notes receivable from stock option exercises | 187 | 187 | ||||||||||||||
Net subscriptions (redemptions/distributions) of non-controlling interest holders | (501) | (501) | 15,529 | |||||||||||||
Net consolidations (deconsolidations) of sponsored investment funds | (16,082) | |||||||||||||||
Changes in redemption value of non-controlling interests redeemable at fair value | $ (719) | (719) | 719 | |||||||||||||
Ending balance at Jul. 31, 2019 | $ 1,129,407 | $ 2 | $ 442 | $ (7,919) | (59,935) | 1,195,775 | $ 1,042 | $ 1,129,407 | $ 346,163 | |||||||
Cumulative effect adjustment upon adoption of new accounting standard | (3,714) | |||||||||||||||
Cumulative effect adjustment upon adoption of new accounting standard | Accounting Standards Update 2016-01 [Member] | $ (3,714) | $ 3,714 |
Consolidated Statements of Sh_2
Consolidated Statements of Shareholders' Equity (Parentheticals) - $ / shares | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | |
Statement of Stockholders' Equity [Abstract] | ||||
Dividends declared per share | $ 0.35 | $ 0.31 | $ 1.05 | $ 0.93 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | ||
Jul. 31, 2019 | Jul. 31, 2018 | ||
Cash Flows From Operating Activities: | |||
Net income | $ 313,926 | $ 292,692 | |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 18,029 | 18,417 | |
Amortization of deferred sales commissions | 16,761 | 13,342 | |
Stock-based compensation | 67,967 | 67,299 | |
Deferred income taxes | 9,109 | 26,741 | |
Net (gains) losses on investments and derivatives | (3,509) | 9,930 | |
Loss on expiration of Hexavest option | 0 | 6,523 | |
Equity in net income of affiliates, net of tax | (6,918) | (8,877) | |
Dividends received from affiliates | 8,221 | 9,164 | |
Consolidated CLO entities' operating activities: | |||
Net losses on bank loan, other investments and note obligations | 3,400 | 1,581 | |
Amortization of bank loan investments | (825) | 0 | |
Decrease in other assets, net of other liabilities | 11,116 | 2,803 | |
Increase in cash due to initial consolidation | 19,009 | 51,278 | |
Changes in operating assets and liabilities: | |||
Management fees and other receivables | 2,572 | (18,620) | |
Short-term debt securities | 23,300 | (44,085) | |
Investments held by consolidated sponsored funds and separatley managed accounts | (17,998) | (166,109) | |
Deferred sales commissions | (20,457) | (24,435) | |
Other assets | 7,316 | 20,058 | |
Accrued compensation | (57,203) | (33,953) | |
Accounts payable and accrued expenses | (1,107) | 15,325 | |
Other liabilities | (12,797) | (611) | |
Net cash provided by operating activities | 379,912 | 238,463 | |
Cash Flows From Investing Activities: | |||
Additions to equipment and leasehold improvements | (29,977) | (12,811) | |
Proceeds from sale of investments | [1] | 13,874 | 9,773 |
Purchase of investments | [1] | (1,481) | (6,930) |
Proceeds from sale of investments in CLO entity note obligations | [1] | 0 | 53,787 |
Purchase of investments in CLO entity note obligations | [1] | (54,352) | (79,089) |
Consolidated CLO entities' investing activities: | |||
Proceeds from sales of bank loans and other investments | 352,375 | 99,621 | |
Purchase of bank loans and other investments | (908,752) | (216,950) | |
Net cash used for investing activities | (628,313) | (152,599) | |
Cash Flows From Financing Activities: | |||
Purchase of additional non-controlling interest | (18,098) | (20,818) | |
Line of credit issuance costs | (930) | 0 | |
Principal repayments on notes receivable from stock option exercises | 672 | 2,829 | |
Dividends paid | (121,083) | (109,542) | |
Net subscriptions received from (redemptions/distributions paid to) non-controlling interest holders | 57,997 | 73,632 | |
Consolidated CLO entities' financing activities: | |||
Proceeds from line of credit | 197,915 | 133,111 | |
Repayment of line of credit | (197,915) | 0 | |
Issuance of senior and subordinated notes obligations | 404,477 | 0 | |
Net cash provided by (used for) financing activities | 95,390 | (44,889) | |
Effect of currency rate changes on cash and cash equivalents | (2,454) | (1,464) | |
Net increase (decrease) in cash, cash equivalents and restricted cash | (155,465) | 39,511 | |
Cash, cash equivalents and restricted cash, beginning of period | 866,075 | 649,863 | |
Cash, cash equivalents and restricted cash, end of period | 710,610 | 689,374 | |
Supplemental Cash and Restricted Cash Flow Information: | |||
Cash paid for interest | 17,350 | 17,221 | |
Cash paid for interest by consolidated CLO entities | 23,735 | 1,421 | |
Cash paid for income taxes, net of refunds | 92,944 | 96,218 | |
Supplemental Schedule of Non-Cash Investing and Financing Transactions: | |||
Increase in equipment and leasehold improvements due to non-cash additions | 2,726 | 206 | |
Exercise of stock options through issuance of notes receivable | 534 | 1,060 | |
Decrease in non-controlling interests due to net consolidations (deconsolidations) of sponsored investment funds | (67,994) | (40,310) | |
Decrease in bank loans and other investments of consolidated CLO entities due to unsettled sales | 18,514 | 0 | |
Increase in bank loans and other investments of consolidated CLO entities due to unsettled purchases | 66,301 | 26,317 | |
Initial Consolidation of CLO Entities: | |||
Increase in bank loans and other investments | 410,853 | 434,446 | |
Increase in senior note obligations | 391,080 | 464,347 | |
Non-Voting Common Stock [Member] | |||
Cash Flows From Financing Activities: | |||
Proceeds from issuance of Non-Voting Common Stock | 30,277 | 62,174 | |
Repurchase of Common Stock | (257,922) | (186,104) | |
Voting Common Stock [Member] | |||
Cash Flows From Financing Activities: | |||
Repurchase of Common Stock | $ 0 | $ (171) | |
[1] | In the fourth quarter of fiscal 2018, the Company elected to present the investing cash flows related to the purchase and sale of investments in CLO entity note obligations separately from the purchase and sale of other investments. The prior year amounts previously presented within the purchase and sale of investments line items have been reclassified to the purchase and sale of investments in CLO entity note obligations line items for comparability purposes. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Jul. 31, 2019 | |
Summary of Significant Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Eaton Vance Corp. Notes to Consolidated Financial Statements (unaudited) 1. Summary of Significant Accounting Policies Basis of presentation In the opinion of management, the accompanying unaudited interim Consolidated Financial Statements of Eaton Vance Corp. (the Company) include all normal recurring adjustments necessary to present fairly the results for the interim periods in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP). Such financial statements have been prepared in accordance with the instructions to Form 10-Q pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures have been omitted pursuant to such rules and regulations. As a result, these financial statements should be read in conjunction with the audited Consolidated Financial Statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended October 31, 2018. Adoption of new accounting standards The Company adopted the following accounting standards as of November 1, 2018: • Revenue recognition – Accounting Standards Update (ASU) 2014-09, Revenue from Contracts with Customers • Financial instruments – ASU 2016-01, Recognition and Measurement of Financial Assets and Liabilities • Statement of cash flows – ASU 2016-15, Classification of Certain Cash Receipts and Cash Payments • Statement of cash flows – ASU 2016-18, Restricted Cash Revenue recognition This guidance seeks to improve comparability by providing a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers. The guidance also changes the accounting for certain contract costs and revises the criteria for determining if an entity is acting as a principal or agent in certain arrangements. The Company adopted the new revenue recognition guidance using a full retrospective approach. The adoption of this guidance did not result in any significant changes to the timing of recognition and measurement of revenue or recognition of costs incurred to obtain and fulfill revenue contracts; however, the presentation of certain revenue and expense balances was affected. Notably, fund subsidies of $ 6.6 million and $ 18.3 million previously included as a component of fund-related expenses in the Consolidated Statements of Income for the three and nine months ended July 31, 2018, respectively, are now presented as a contra-revenue component of management fees. Separately, in applying the revised principal-versus-agent guidance to the Company’s various distribution contracts for certain classes of shares in sponsored funds with a front-end load commission pricing structure, the entire front-end load commission (including both the underwriting commission retained by the Company and the sales charge paid to the selling broker-dealer) is now presented gross within distribution and underwriting fee revenue and the sales charge paid to the selling broker-dealer is now presented within distribution expense in the Consolidated Statements of Income. Prior to the adoption of ASU 2014-09, only the underwriting commission retained by the Company was presented within distribution and underwriting fee revenue as the sales charge paid to the selling broker-dealer was recorded net. Accordingly, distribution and underwriter fees and distribution expense increased by approximately $ 4.6 million and $ 13.4 million for the three and nine months ended July 31, 2018, respectively, as a result of this change. Lastly, contingent deferred sales charges received, which were previously recorded as a reduction of deferred sales commission assets, are now being recorded as revenue within the distribution and underwriting fees line item in the Consolidated Statements of Income. The following tables present the effect of the changes in presentation made to prior periods which are attributable to the retrospective adoption of ASU 2014-09: Three Months Ended July 31, 2018 (in thousands) As Previously Reported Reclassification As Restated Revenue: Management fees $ 374,553 $ ( 5,592) $ 368,961 Distribution and underwriter fees 20,099 4,639 24,738 Service fees 31,260 ( 207) 31,053 Other revenue 4,690 ( 751) 3,939 Total revenue 430,602 ( 1,911) 428,691 Expenses: Compensation and related costs 152,921 - 152,921 Distribution expense 35,045 6,379 41,424 Service fee expense 28,760 ( 1,686) 27,074 Amortization of deferred sales commissions 4,637 - 4,637 Fund-related expenses 15,857 ( 6,604) 9,253 Other expenses 51,118 - 51,118 Total expenses 288,338 ( 1,911) 286,427 Operating income $ 142,264 $ - $ 142,264 Nine Months Ended July 31, 2018 (in thousands) As Previously Reported Reclassification As Restated Revenue: Management fees $ 1,101,929 $ ( 15,035) $ 1,086,894 Distribution and underwriter fees 60,393 13,449 73,842 Service fees 91,935 ( 1,068) 90,867 Other revenue 12,018 ( 1,994) 10,024 Total revenue 1,266,275 ( 4,648) 1,261,627 Expenses: Compensation and related costs 455,958 - 455,958 Distribution expense 105,219 18,672 123,891 Service fee expense 84,651 ( 5,057) 79,594 Amortization of deferred sales commissions 13,342 - 13,342 Fund-related expenses 46,036 ( 18,263) 27,773 Other expenses 150,319 - 150,319 Total expenses 855,525 ( 4,648) 850,877 Operating income $ 410,750 $ - $ 410,750 Financial instruments – recognition and measurement This guidance requires substantially all equity investments in unconsolidated entities (other than those accounted for under the equity method of accounting) with a readily determinable fair value to be measured at fair value with changes in fair value recognized in net income. The standard effectively eliminates the ability, at acquisition, to classify an equity investment as available-for-sale with holding gains and losses presented in other comprehensive income until realized. The Company adopted this provision of the new ASU using a modified retrospective approach. The Company held $ 10.3 million of available-for-sale equity investments in unconsolidated sponsored funds at October 31, 2018. Upon adoption, the Company recognized a $ 3.7 million cumulative effect adjustment (increase), net of related income tax effects, to reclassify unrealized holding gains attributable to these investments previously recognized in accumulated other comprehensive income (loss) to retained earnings. Prior period investments in unconsolidated sponsored mutual funds and private open-end funds previously classified as trading and available-for-sale are now referred to as “equity securities” within the notes to the financial statements; the prior period treatment of gains or losses arising from changes in the fair value of these investments was retained. The standard also provides for an election to measure certain investments without a readily determinable fair value at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer (the cost method). The Company adopted this provision of the ASU using a prospective approach. Statement of cash flows – classification This standard clarifies how certain cash receipts and cash payments are classified and presented on the Consolidated Statement of Cash Flows. The Company adopted ASU 2016-15 using a retrospective approach. The adoption of this standard did not result in any changes to the classification of prior period activity on the Company’s Consolidated Statements of Cash Flows. Statement of cash flows – restricted cash This standard requires the inclusion of restricted cash and restricted cash equivalents (restricted cash) with cash and cash equivalents when reconciling the beginning and ending amounts on the Consolidated Statement of Cash Flows. Restricted cash includes cash held by consolidated sponsored funds and consolidated collateralized loan obligation (CLO) entities. The Company adopted this new guidance using a retrospective approach. Accordingly, previously reported net changes in the restricted cash balances of consolidated sponsored funds and consolidated CLO entities, which totaled $ 35.9 million for the nine months ended July 31, 2018, are no longer presented as a component of the Company’s net cash provided by operating activities for that period. Conversely, an increase in cash due to initial consolidation was added as a separate component of net cash provided by operating activities for the nine months ended July 31, 2018 to reflect the restricted cash balance of a CLO entity initially consolidated during that period. A reconciliation of cash, cash equivalents, and restricted cash for all balance sheet periods presented is included in Note 2. In addition to the standards described above, the Company also early adopted the portion of ASU 2018-13, Fair Value Measurement: Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement, related to the removal of certain fair value disclosure requirements. The fair value disclosures required to be added under this new guidance will be effective for the fiscal year that begins on November 1, 2020. Where applicable, the Company’s significant accounting policies provided below have been updated to reflect the adoption of these new accounting standards as of November 1, 2018. Restricted cash Restricted cash includes cash collateral required for margin accounts established to support derivative positions and other segregated cash to comply with certain regulatory requirements. Such derivatives are used to hedge certain investments in consolidated sponsored funds and separately managed accounts seeded for business development purposes (consolidated seed investments). Restricted cash also includes cash and cash equivalents held by consolidated sponsored funds and consolidated CLO entities, which are not available to the Company for its general operations. Investments Debt securities held at fair value Debt securities held at fair value consist of short-term debt securities held directly by the Company comprised of certificates of deposit, commercial paper and corporate debt obligations with original (remaining) maturities to the Company ranging from three months to 12 months, as determined upon the purchase of each security, as well as investments in debt securities held in portfolios of consolidated sponsored mutual funds and private open-end funds (sponsored funds) and separately managed accounts. Debt securities are measured at fair value with net realized and unrealized holding gains or losses, and interest and dividend income reflected as a component of gains (losses) and other investment income, net, on the Company’s Consolidated Statements of Income. The specific identified cost method is used to determine the realized gains or losses on all debt securities sold. Equity securities held at fair value Equity securities primarily consist of domestic and foreign equity securities held in portfolios of consolidated sponsored funds and separately managed accounts and investments in non-consolidated sponsored or other funds. Equity securities and investments in non-consolidated sponsored or other mutual funds with readily determinable fair values are measured at fair value based on quoted market prices and published net asset values per share, respectively. Investments in non-consolidated sponsored private open-end funds without readily determinable fair values are measured at fair value based on the net asset value per share (or equivalent) of the investment as a practical expedient. Equity investments without readily determinable fair values are measured at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer (the cost method). Investments held at cost are qualitatively evaluated for impairment each reporting period. If that qualitative assessment indicates that the investment held at cost is impaired, the fair value of the investment is estimated and an impairment loss is recognized equal to the difference between the fair value of the investment and its carrying amount. The cost method is no longer applied if the equity security subsequently has a readily determinable fair value or the Company irrevocably elects to measure the equity security at fair value. Net realized and unrealized holding gains or losses on equity securities, any observable price changes and/or impairment losses attributable to investments held at cost, and dividend income are all reflected within gains (losses) and other investment income, net, on the Company’s Consolidated Statements of Income. The specific identified cost method is used to determine the realized gains or losses on all equity securities sold. Investments in non-consolidated CLO entities Investments in non-consolidated CLO entities are carried at amortized cost unless impaired. The excess of actual and anticipated future cash flows over the initial investment at the date of purchase is recognized in gains (losses) and other investment income, net, over the life of the investment using the effective yield method. The Company reviews cash flow estimates throughout the life of each non-consolidated CLO entity. If the updated estimate of future cash flows (taking into account both timing and amounts) is less than the last estimate, an impairment loss is recognized to the extent the carrying amount of the investment exceeds its fair value. Investments in equity method investees Investments in non-controlled affiliates in which the Company’s ownership ranges from 20 to 50 percent, or in instances in which the Company is able to exercise significant influence but not control, are accounted for under the equity method of accounting. Under the equity method of accounting, the Company’s share of the investee’s underlying net income or loss is recorded as equity in net income of affiliates, net of tax. Distributions received from investees reduce the Company’s investment balance and are classified as cash flows either from operating activities or investing activities in the Company’s Consolidated Statements of Cash Flows as determined using the cumulative earnings method. Investments in equity method investees are evaluated for impairment as events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. If the carrying amounts of the assets exceed their respective fair values, additional impairment tests are performed to measure the amounts of the impairment losses, if any. Deferred sales commissions Sales commissions paid to broker‐dealers in connection with the sale of certain classes of shares of sponsored funds are generally deferred and amortized over the period during which redemptions by the purchasing shareholder are subject to a contingent deferred sales charge, which does not exceed five years from purchase. Distribution fees and contingent deferred sales charges received from these funds are recorded in revenue as earned. Should the Company lose its ability to recover such sales commissions through earning distribution fees, the value of its deferred sales commission asset would immediately decline, as would related future cash flows. The Company evaluates the carrying value of its deferred sales commission asset for impairment on a quarterly basis. In its impairment analysis, the Company compares the carrying value of the deferred sales commission asset to the undiscounted cash flows expected to be generated by the asset in the form of distribution fees over its remaining useful life to determine whether impairment has occurred. If the carrying value of the asset exceeds the undiscounted cash flows, the asset is written down to fair value based on discounted cash flows. Impairment adjustments are recognized in operating income as a component of amortization of deferred sales commissions. Revenue recognition The Company primarily earns revenue from providing asset management services, distribution and underwriter services and shareholder services to its sponsored fund and separate account customers through various contracts. Revenue is recognized for each distinct performance obligation identified in contracts with customers when the performance obligation has been satisfied by transferring services to a customer either over time or at a point in time (which is when the customer obtains control of the service). Revenue recognized is the amount of variable or fixed consideration allocated to the satisfied performance obligation that the Company expects to be entitled to in exchange for transferring such services to a customer (the transaction price). Variable consideration is included in the transaction price only when it is probable that a significant reversal of such revenue will not occur or when the uncertainty associated with the variable consideration is subsequently resolved (the constraint). The majority of the fees earned from providing asset management, distribution and shareholder services represent variable consideration as the revenue is largely dependent on the total value and composition of assets under management. The total value of assets under management fluctuates with the financial markets. These fees are constrained and excluded from the transaction price until the asset values on which the customer is billed are calculated and the value of consideration is measurable and no longer subject to financial market volatility. The timing of when the Company bills its customers and related payment terms vary in accordance with the agreed-upon contractual terms. A majority of the Company’s clients are billed after the service is performed, which results in the recording of accounts receivable and accrued revenue. Deferred revenue is recorded in instances where a client is billed in advance. Management fees The Company is entitled to receive management fees in exchange for asset management services provided to sponsored funds and separate accounts established for retail clients (either directly or indirectly through various third-party financial intermediaries that sponsor various active asset management and model-based active asset management investment programs), high net worth clients and institutional clients. Management fees from sponsored funds are calculated principally as a percentage of average daily net assets, are earned daily upon completion of investment advisory and administrative service performance obligations, and are typically paid monthly from the assets of the fund. Management fees from separate accounts are calculated as a percentage of either beginning, average or ending monthly or quarterly net assets, are earned daily, and are typically paid either monthly or quarterly from the assets of the separate account. Performance fees related to certain fund and separate account management contracts are generated when specific performance hurdles are met during the performance period. The Company may waive certain fees for asset management services provided to sponsored funds at its discretion. Separately, the Company may subsidize certain share classes of sponsored funds to ensure that operating expenses attributable to such share classes do not exceed a specified percentage. Fee waivers and fund subsidies are recognized as a reduction to management fee revenue. Distribution and underwriter fees The Company is entitled to receive distribution fees and underwriter commissions in exchange for distribution services provided to sponsored funds. Distribution services consist of distinct sales and marketing activities that are earned upon the sale of sponsored fund shares. Distribution fees for all share classes subject to these fees are calculated as a percentage of average daily net assets, and are typically paid monthly from the assets of the fund. Underwriting commissions for all share classes subject to these fees are calculated as a percentage of the amount invested and are deducted from the amount invested by the fund shareholder. These commissions represent fixed consideration and are recognized as revenue when the sponsored fund shares are sold to the shareholder. Underwriter commissions are waived or reduced on purchases of shares that exceed specified minimum amounts. Service fees The Company is entitled to receive service fees in exchange for shareholder services provided to sponsored funds. Shareholder services are comprised of a series of distinct incremental days of shareholder transaction processing and/or shareholder account maintenance services. Service fees are calculated as a percentage of average daily net assets under management, are earned daily upon completion of shareholder services, and are typically paid monthly from the assets of the fund. Principal versus agent The Company has contractual arrangements with third parties that are involved in providing various services primarily to sponsored fund customers, including sub-advisory, distribution and shareholder services. In instances where the Company has discretion to hire a third party to provide services to the Company’s clients, the Company is generally deemed to control the services before transferring them to the clients, and accordingly presents the revenues gross of the related third-party costs. Alternatively, the Company is acting as an agent (and therefore should record revenue net of payments to third-party service providers) when it does not control the service. The Company controls the right to asset management services performed by various third-party sub-advisers; therefore management fee revenue is recorded on a gross basis. Fees paid to sub-advisers are recognized as an expense when incurred and are included in fund-related expenses in the Company’s Consolidated Statements of Income. Separately, the Company also controls the right to distribution and shareholder services performed by various third-parties (including financial intermediaries); therefore distribution and underwriter fees and service fees are also recorded on a gross basis. Fees paid to third parties for distribution and shareholder services are recognized as an expense when incurred and are included in distribution expense and service fee expense, respectively, in the Company’s Consolidated Statements of Income. Comprehensive income The Company reports all changes in comprehensive income in its Consolidated Statements of Comprehensive Income. Comprehensive income includes net income, unrealized gains and losses on certain derivatives designated as cash flow hedges and related reclassification adjustments attributable to the amortization of net gains and losses on these derivatives and foreign currency translation adjustments, in each case net of tax. When the Company has established an indefinite reinvestment assertion for a foreign subsidiary, deferred income taxes are not provided on the related foreign currency translation. New Accounting Standards Not Yet Adopted Leases In February 2016, the Financial Accounting Standards Board (FASB) issued new guidance for the accounting for leases, which requires a lessee to recognize on the balance sheet the assets and liabilities for the rights and obligations created by those leases with a lease term of more than 12 months. Leases will continue to be classified as either financing or operating, with classification affecting the recognition, measurement and presentation of expenses and cash flows arising from a lease. The new guidance is effective for the Company’s fiscal year that begins on November 1, 2019. The Company will apply a modified retrospective approach to adoption without restating comparative periods. The Company’s leases primarily include non-cancellable operating leases for office space and equipment. The Company will elect practical expedients that are intended to reduce the complexity of adoption and result in no requirement to reassess the following: whether an arrangement is or contains a lease, the classification of the lease, the recognition requirement for initial direct costs, and assumptions regarding renewal options that affect the lease term. The Company is evaluating the impact of the new guidance on the Consolidated Balance Sheet where the Company will be recording a right-of-use asset and lease liability for all of its operating leases. The lease liability will be initially measured at the present value of the future lease payments. The new guidance is not expected to have a significant impact on our results of operations or cash flows because the operating lease costs will continue to be recognized on a straight-line basis over the remaining lease term and lease payments will continue to be classified within operating activities in the Consolidated Statement of Cash Flows. The Company is in the process of finalizing its lease population and extracting relevant information from identified lease arrangements, evaluating the discount rate that will be used to measure lease liabilities at the date of initial application, implementing software to comply with the new guidance and developing and implementing appropriate changes to our internal processes and controls. |
Cash, Cash Equivalents and Rest
Cash, Cash Equivalents and Restricted Cash | 9 Months Ended |
Jul. 31, 2019 | |
Cash, Cash Equivalents and Restricted Cash [Abstract] | |
Cash, Cash Equivalents and Restricted Cash | 2. Cash, Cash Equivalents and Restricted Cash The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the Company’s Consolidated Balance Sheets that equal the total of the same such amounts presented in the Consolidated Statements of Cash Flows: July 31, October 31, (in thousands) 2019 2018 Cash and cash equivalents $ 527,708 $ 600,696 Restricted cash of consolidated sponsored funds included in investments 72,461 33,525 Restricted cash included in assets of consolidated CLO entities, cash 87,755 216,598 Restricted cash included in other assets 22,686 15,256 Total cash, cash equivalents and restricted cash presented in the Consolidated Statement of Cash Flows $ 710,610 $ 866,075 |
Investments
Investments | 9 Months Ended |
Jul. 31, 2019 | |
Investments [Abstract] | |
Investments | 3. Investments The following is a summary of investments: (in thousands) July 31,2019 October 31,2018 Investments held at fair value: Short-term debt securities $ 250,088 $ 273,320 Debt and equity securities held by consolidated sponsored funds 551,142 540,582 Debt and equity securities held in separately managed accounts 72,176 89,121 Non-consolidated sponsored funds and other 8,291 10,329 Total investments held at fair value 881,697 913,352 Investments held at cost 20,904 20,874 Investments in non-consolidated CLO entities 1,251 2,895 Investments in equity method investees 140,174 141,506 Total investments (1)(2) $ 1,044,026 $ 1,078,627 (1) Excludes bank loans and other investments held by consolidated CLO entities, which are discussed in Note 4. (2) Amounts at July 31, 2019 reflect the adoption of ASU 2016-01. Amounts at October 31, 2018 reflect accounting guidance prior to the adoption of ASU 2016-01. See Note 1 for further information. Investments held at fair value The Company recognized gains (losses) related to debt and equity securities held at fair value within gains and other investment income, net, on the Company’s Consolidated Statements of Income as follows: Three Months Ended Nine Months Ended July 31, July 31, (in thousands) 2019 2018 2019 2018 Realized gains (losses) on securities sold $ ( 298) $ 1,272 $ ( 531) $ 7,396 Unrealized gains (losses) on investments held at fair value 3,156 ( 3,433) 14,532 ( 10,407) Net gains (losses) on investments held at fair value (1) $ 2,858 $ ( 2,161) $ 14,001 $ ( 3,011) (1) Amounts for the three and nine months ended July 31, 2019 reflect the adoption of ASU 2016-01. The prior period gains and losses arising from changes in the fair value of investments reflect accounting guidance prior to the adoption of ASU 2016-01. See Note 1 for further information. Investments held at cost Investments held at cost primarily include the Company’s equity investment in a wealth management technology firm. At both July 31, 2019 and 2018, there were no indicators of impairments related to investments carried at cost. Investments in non-consolidated CLO entities The Company provides investment management services for, and has made direct investments in, CLO entities that it does not consolidate, as described further in Note 4. At July 31, 2019 and October 31, 2018, combined assets under management in the pools of non-consolidated CLO entities were $ 0.4 billion and $ 0.8 billion, respectively. The Company did not 0.2 million of other-than temporary impairment losses. Investments in equity method investees The Company has a 49 percent equity interest in Hexavest Inc. (Hexavest), a Montreal, Canada-based investment adviser. The carrying value of this investment consisted of the following: (in millions) July 31,2019 October 31,2018 Equity in net assets of Hexavest $ 5.7 $ 6.0 Definite-lived intangible assets 20.0 21.3 Goodwill 116.4 116.4 Deferred tax liability ( 5.4) ( 5.7) Total carrying value $ 136.7 $ 138.0 The Company’s investment in Hexavest is denominated in Canadian dollars and is subject to foreign currency translation adjustments, which are recorded in accumulated other comprehensive income (loss). Changes in the carrying value of goodwill is entirely attributable to foreign currency translation adjustments. The Company also has a seven 3.5 million. The Company did no During the nine months ended July 31, 2019 and 2018, the Company received dividends of $ 8.2 million and $ 9.2 million, respectively, from its investments in equity method investees. |
Variable Interest Entities
Variable Interest Entities | 9 Months Ended |
Jul. 31, 2019 | |
Variable Interest Entities [Abstract] | |
Variable Interest Entities | 4. Variable Interest Entities (VIEs) Investments in VIEs that are consolidated In the normal course of business, the Company maintains investments in sponsored entities that are considered VIEs to support their launch and marketing. The Company consolidates these sponsored entities if it is the primary beneficiary of the VIE. Consolidated sponsored funds The Company invests in investment companies that meet the definition of a VIE. Underlying investments held by consolidated sponsored funds consist of debt and equity securities and are included in the reported amount of investments on the Company’s Consolidated Balance Sheets at July 31, 2019 and October 31, 2018. Net investment income or (loss) related to consolidated sponsored funds was included in gains and other investment income, net, on the Company’s Consolidated Statements of Income for all periods presented. The impact of consolidated sponsored funds’ net income or (loss) on net income attributable to Eaton Vance Corp. shareholders was reduced by amounts attributable to non-controlling interest holders, which are recorded in net income attributable to non-controlling and other beneficial interests on the Company’s Consolidated Statements of Income for all periods presented. The extent of the Company’s exposure to loss with respect to a consolidated sponsored fund is limited to the amount of the Company’s investment in the sponsored fund and any uncollected management and performance fees. The Company is not obligated to provide financial support to sponsored funds. Only the assets of a sponsored fund are available to settle its obligations. Beneficial interest holders of sponsored funds do not have recourse to the general credit of the Company. The following table sets forth the balances related to consolidated sponsored funds as well as the Company’s net interest in these funds: (in thousands) July 31,2019 October 31,2018 Investments $ 551,142 $ 540,582 Other assets 30,626 15,471 Other liabilities ( 38,847) ( 57,286) Redeemable non-controlling interests ( 258,207) ( 244,970) Net interest in consolidated sponsored funds $ 284,714 $ 253,797 Consolidated CLO entities As of July 31, 2019, the Company deemed itself to be the primary beneficiary of four three 1.9 million related to the residual assets held by the entity as of October 31, 2018. The assets of consolidated CLO entities are held solely as collateral to satisfy the obligations of each entity. The Company has no right to receive benefits from, nor does the Company bear the risks associated with, the assets held by these CLO entities beyond the Company’s investment in these entities. In the event of default, recourse to the Company is limited to its investment in these entities. The Company has not provided any financial or other support to these entities that it was not previously contractually required to provide, and there are neither explicit arrangements nor does the Company hold implicit variable interests that could require the Company to provide any ongoing financial support to these entities. Other beneficial interest holders of consolidated CLO entities do not have any recourse to the Company’s general credit. Eaton Vance CLO 2019-1 The Company established CLO 2019-1 as a warehousing phase CLO entity on January 3, 2019. The Company entered into a credit facility agreement with a third-party lender to provide CLO 2019-1 with a $ 160.0 million non-recourse revolving line of credit upon inception of the entity. The Company contributed a total of $ 40.0 million in capital to the CLO 2019-1 warehouse, which it used along with the proceeds from the revolving line of credit to accumulate a portfolio of commercial bank loan investments for eventual securitization. In the second quarter of fiscal 2019, CLO 2019-1 entered the securitization phase. Contemporaneous with the close of the CLO 2019-1 securitization on May 15, 2019, the proceeds from the issuance of senior and subordinated note obligations were used to purchase the portfolio bank loans held by the CLO 2019-1 warehouse, repay the third-party revolving line of credit provided to the CLO 2019-1 warehouse and return the Company’s total capital contributions in the warehouse of $ 40 million. The Company acquired 100 percent of the subordinated notes issued by CLO 2019-1 at closing for $ 28.9 million and will provide collateral management services to this CLO entity in exchange for a collateral management fee. The Company deemed itself to be the primary beneficiary of CLO 2019-1 upon acquiring 100 percent of the subordinated interests of CLO 2019-1 on May 15, 2019 and began consolidating the entity as of that date. Eaton Vance CLO 2013-1 As of October 31, 2018, the Company held 100 percent of the Class E senior notes of CLO 2013-1 as an investment in non-consolidated CLO entities with a carrying value of $ 1.4 million. The Company is the collateral manager of CLO 2013-1. On May 1, 2019, the Company purchased 100 percent of the subordinated interests of CLO 2013-1 for $ 25.4 million. The Company deemed itself to be the primary beneficiary of CLO 2013-1 upon acquiring 100 percent of the subordinated interests of the entity on May 15, 2019 and began consolidating CLO 2013-1 as of that date. Subsequent event – CLO 2013-1 refinancing On August 9, 2019, CLO 2013-1 refinanced certain tranches of its senior note obligations. Contemporaneous with the close of the refinancing, the proceeds from the issuance of new senior note obligations were used to redeem certain tranches of the old senior note obligations of CLO 2013-1. The senior and subordinated note tranches held by the Company were not impacted by the refinancing, and the Company continues to serve as collateral manager of the entity. Accordingly, the Company continues to deem itself as the primary beneficiary of CLO 2013-1 as it has both power and economics and will continue to consolidate the entity. Eaton Vance CLO 2018-1 CLO 2018-1 was securitized on October 24, 2018. As of July 31, 2019, the Company continues to hold approximately 93 percent of the subordinated notes that were issued by CLO 2018-1 at closing and is still serving as the collateral manager of the entity. The Company deemed itself to be the primary beneficiary of CLO 2018-1 upon acquiring 93 percent of the subordinated interests of the entity on October 24, 2018 and began consolidating CLO 2018-1 as of that date. Eaton Vance CLO 2014-1R CLO 2014-1R was securitized on August 23, 2018. As of July 31, 2019, the Company continues to hold 100 percent of the subordinated notes that were issued by CLO 2014-1R at closing and is still serving as the collateral manager of the entity. The Company deemed itself to be the primary beneficiary of CLO 2014-1R upon acquiring 100 percent of the subordinated interests of the entity on August 23, 2018 and began consolidating CLO 2014-1R as of that date. The Company elected to apply the measurement alternative to ASC 820 for collateralized financing entities upon the initial consolidation and for the subsequent measurement of the securitized CLO entities consolidated by the Company (collectively, the consolidated securitized CLO entities). The Company determined that the fair value of the financial assets of these entities is more observable than the fair value of the financial liabilities. Through the application of the measurement alternative, the fair value of the financial liabilities of these entities are measured as the difference between the fair value of the financial assets and the fair value of the Company’s beneficial interests in these entities, which include the subordinated interests held by the Company and any accrued management fees due to the Company. The fair value of the subordinated notes held by the Company is determined primarily based on an income approach, which projects the cash flows of the CLO assets using projected default, prepayment, recovery and discount rates, as well as observable assumptions about market yields, callability and other market factors. An appropriate discount rate is then applied to determine the discounted cash flow valuation of the subordinated notes. Aggregate disclosures for the securitized CLO entities consolidated by the Company as of July 31, 2019 and October 31, 2018 are provided below. The Company did not consolidate any warehousing phase CLO entities as of July 31, 2019 or October 31, 2018. The following table presents the balances attributable to the consolidated securitized CLO entities included in the Company’s Consolidated Balance Sheets: July 31, October 31, (in thousands) 2019 2018 Assets of consolidated CLO entities: Cash $ 87,755 $ 216,598 Bank loans and other investments 1,706,350 874,304 Receivable for pending bank loan sales 18,514 2,535 Other assets 3,469 1,929 Liabilities of consolidated CLO entities: Senior and subordinated note obligations 1,620,598 873,008 Payable for pending bank loan purchases 66,301 152,152 Other liabilities 14,874 2,033 Total beneficial interests $ 114,315 $ 68,173 Although the Company’s beneficial interests in the consolidated securitized CLO entities are eliminated upon consolidation, the application of the measurement alternative results in the Company’s total beneficial interests in these entities of $ 114.3 million and $ 68.2 million at July 31, 2019 and October 31, 2018, respectively, being equal to the net amount of the consolidated CLO entities’ assets and liabilities included on the Company’s Consolidated Balance Sheets, as shown above. As of July 31, 2019 and October 31, 2018, there were no bank loan investments in default and no unpaid principal balances of such loans that were 90 days or more past due or in non-accrual status. Additional disclosure of the fair values of assets and liabilities of consolidated CLO entities that are measured at fair value on a recurring basis is included in Note 6. The following table presents the balances attributable to consolidated warehouse CLO entities included in the Company’s Consolidated Statements of Income: Consolidated Warehouse CLO Entities Three Months Ended Nine Months Ended July 31, July 31, (in thousands) 2019 2018 2019 2018 Other income (expense) of consolidated CLO entities: Gains (losses) and other investment income, net $ ( 1,994) $ 1,907 $ 3,308 $ 4,883 Interest and other expense ( 258) ( 999) ( 1,490) ( 1,537) Net gain (loss) attributable to the Company $ ( 2,252) $ 908 $ 1,818 $ 3,346 The following table presents the balances attributable to consolidated securitized CLO entities included in the Company’s Consolidated Statements of Income: Consolidated Securitized CLO Entities Three Months Ended Nine Months Ended July 31, July 31, (in thousands) 2019 2018 2019 2018 Other income (expense) of consolidated CLO entities: Gains (losses) and other investment income, net $ 20,254 $ ( 60) $ 42,187 $ ( 60) Interest and other expense ( 21,490) ( 2,093) ( 39,415) ( 2,093) Net gain (loss) attributable to the Company $ ( 1,236) $ ( 2,153) $ 2,772 $ ( 2,153) As summarized in the table below, the application of the measurement alternative results in the Company's earnings from the consolidated securitized CLO entities subsequent to initial consolidation, as shown above, to be equivalent to the Company's own economic interests in these entities: Three Months Ended Nine Months Ended July 31, July 31, (in thousands) 2019 2018 2019 2018 Economic interests in Consolidated Securitized CLO Entities: Distributions received and unrealized gains (losses) on the senior and subordinated interests held by the Company $ ( 2,943) $ ( 2,390) $ ( 1,072) $ ( 2,390) Management fees 1,707 237 3,844 237 Total economic interests $ ( 1,236) $ ( 2,153) $ 2,772 $ ( 2,153) Other entity As of October 31, 2018, the Company held variable interests in, and was deemed to be the primary beneficiary of, a privately offered equity fund that was seeded towards the end of fiscal 2018. The Company’s variable interests consisted of a $ investment in the fund and a promissory note that enabled the fund to borrow up to $ 25.0 million from the Company. As of October 31, 2018, the Company’s risk of loss with respect to this entity was limited to the Company’s investment in the fund and the outstanding borrowings under the promissory note of $ million. The Company invested an additional $ 10,000 upon launching of the fund in December 2018, at which time the total outstanding borrowings were repaid to the Company and the promissory note was canceled on January 14, 2019. As of July 31, 2019 the Company’s variable interest in the fund is limited to its $ investment in the fund. The Company is no longer the primary beneficiary of the fund as it no longer has an obligation to absorb losses of, or the right to receive benefits from, the fund that could potentially be significant to the entity. Investments in VIEs that are not consolidated Sponsored funds The Company classifies its investments in certain sponsored funds that are considered VIEs as equity securities when it is not considered the primary beneficiary of these VIEs. The Company provides aggregated disclosures with respect to these non-consolidated sponsored fund VIEs in Notes 3 and 6. Non-consolidated CLO entities The Company is not deemed the primary beneficiary of certain CLO entities in which it holds variable interests. In developing its conclusion that it is not the primary beneficiary of these entities, the Company determined that although it has variable interests in each CLO by virtue of its beneficial ownership interests in the CLO entities, these interests neither individually nor in the aggregate represent an obligation to absorb losses of, or a right to receive benefits from, any such entity that could potentially be significant to that entity. The Company’s maximum exposure to loss with respect to these non-consolidated CLO entities is limited to the carrying value of its investments in, and collateral management fees receivable from, these entities as of July 31, 2019. Collateral management fees receivable for these entities totaled $ 0.1 million on both July 31, 2019 and October 31, 2018. Investors in these CLO entities have no recourse against the Company for any losses sustained in the CLO structures. The Company did not provide any financial or other support to these entities that it was not previously contractually required to provide in any of the fiscal years presented. Income from these entities is recorded as a component of gains (losses) and other investment income, net, in the Company’s Consolidated Statements of Income, based upon projected investment yields. Additional information regarding the Company’s investment in non-consolidated CLO entities, as well as the combined assets under management in the pools of non-consolidated CLO entities, is included in Note 3. Other entities The Company holds variable interests in, but is not deemed to be the primary beneficiary of, certain sponsored privately offered equity funds with total assets of $ 25.3 billion and $ 21.8 billion on July 31, 2019 and October 31, 2018, respectively. The Company’s variable interests in these entities consist of the Company’s direct ownership therein, which in each case is insignificant relative to the total ownership of the fund, and any investment advisory fees earned but uncollected. The Company’s maximum exposure to loss with respect to these managed entities is limited to the carrying value of its investments in, and investment advisory fees receivables from, the entities as of July 31, 2019. The Company held investments in these entities totaling $ 0.5 million and $ 2.7 million on July 31, 2019 and October 31, 2018, respectively, and investment advisory fees receivable totaling $ 1.5 million and $ 1.3 million on July 31, 2019 and October 31, 2018, respectively. The Company did not provide any financial or other support to these entities that it was not contractually required to provide in any of the periods presented. The Company does not consolidate these VIEs because it does not have the obligation to absorb losses of, or the right to receive benefits from, these VIEs that could potentially be significant to these VIEs. The Company’s investments in privately offered equity funds are carried at fair value and included in non-consolidated sponsored funds and other, which are disclosed as a component of investments in Note 3. The Company also holds a variable interest in, but is not deemed to be the primary beneficiary of, a private equity partnership managed by a third party that invests in companies in the financial services industry. The Company’s variable interest in this entity consists of the Company’s direct ownership in the private equity partnership, equal to $ 3.5 million at both July 31, 2019 and October 31, 2018. The Company did not provide any financial or other support to this entity. The Company’s risk of loss with respect to the private equity partnership is limited to the carrying value of its investment in the entity as of July 31, 2019. The Company does not consolidate this VIE because the Company does not hold the power to direct the activities that most significantly affect the VIE. The Company’s investment in the private equity partnership is accounted for as an equity method investment and disclosures related to this entity are included in Note 3 under the heading Investments in equity method investees. |
Derivative Financial Instrument
Derivative Financial Instruments | 9 Months Ended |
Jul. 31, 2019 | |
Derivative Financial Instruments [Abstract] | |
Derivative Financial Instruments | 5. Derivative Financial Instruments Derivative financial instruments designated as cash flow hedges In fiscal 2017, the Company entered into a Treasury lock transaction in connection with the offering of its 2027 Senior Notes. The Company concurrently designated the Treasury lock as a cash flow hedge to mitigate its exposure to variability in the forecasted semi-annual interest payments and recorded a loss in other comprehensive income (loss), net of tax. The Company reclassified approximately $ 17,000 and $, 51000 of the loss into interest expense during both the three and nine months ended July 31, 2019 and 2018, respectively, and will reclassify the remaining $ 0.5 million loss as of July 31, 2019 to earnings over the remaining term of the debt. During the next 12 months, the Company expects to reclassify approximately $ 68,000 of the unamortized loss. In fiscal 2013, the Company entered into a forward-starting interest rate swap in connection with the offering of its 2023 Senior Notes and recorded a gain in other comprehensive income (loss), net of tax. The Company reclassified $ 50,000 and $ 0.2 million of the gain into interest expense during the three and nine months ended July 31, 2019 and 2018, respectively, and will reclassify the remaining $ 0.8 million gain as of July 31, 2019 to earnings over the remaining term of the debt. During the next 12 months, the Company expects to reclassify approximately $ 0.2 million of the unamortized gain. Other derivative financial instruments not designated for hedge accounting The Company utilizes derivative financial instruments to hedge the market and currency risks associated with its investments in certain consolidated seed investments that are not designated as hedging instruments for accounting purposes. Excluding derivative financial instruments held by consolidated sponsored funds, the Company was party to the following derivative financial instruments: July 31, 2019 October 31, 2018 Number of Contracts Notional Value ( in millions ) Number of Contracts Notional Value ( in millions ) Stock index futures contracts 1,104 $ 144.7 1,007 $ 91.5 Total return swap contracts 4 $ 124.9 3 $ 106.5 Credit default swap contracts 1 $ 8.0 1 $ 5.0 Foreign exchange contracts 44 $ 95.5 28 $ 23.0 Commodity futures contracts 292 $ 12.1 253 $ 11.6 Currency futures contracts 191 $ 20.2 165 $ 16.9 Interest rate futures contracts 177 $ 28.9 282 $ 48.0 The derivative contracts outstanding and notional values they represent at July 31, 2019 and October 31, 2018 are representative of derivative balances throughout each respective year. The Company has not elected to offset fair value amounts related to derivative financial instruments executed with the same counterparty under master netting arrangements; as a result, the Company records all derivative financial instruments as either other assets or other liabilities, gross, on its Consolidated Balance Sheets and measures them at fair value. The following table presents the fair value of derivative financial instruments not designated for hedge accounting and how they are reflected on the Company’s Consolidated Balance Sheets: July 31, 2019 October 31, 2018 (in thousands) Other Assets Other Liabilities Other Assets Other Liabilities Stock index futures contracts $ 399 $ 1,805 $ 5,055 $ 372 Total return swap contracts 50 10,705 - 3,297 Credit default swap contracts 220 - - 10 Foreign exchange contracts 403 1,262 329 202 Commodity futures contracts 94 418 770 216 Currency futures contracts 210 196 14 332 Interest rate futures contracts 61 799 179 17 Total $ 1,437 $ 15,185 $ 6,347 $ 4,446 The Company maintains collateral with certain counterparties to satisfy margin requirements for derivative positions. The collateral is classified as restricted cash and is included as a component of other assets on the Consolidated Balance Sheets. At July 31, 2019 and October 31, 2018, collateral balances were $ 20.7 million and $ 13.1 million, respectively. The Company recognized the following gains (losses) on derivative financial instruments within gains (losses) and other investment income, net, on the Company’s Consolidated Statements of Income: Three Months Ended Nine Months Ended July 31, July 31, (in thousands) 2019 2018 2019 2018 Stock index futures contracts $ 856 $ ( 1,448) $ ( 5,041) $ ( 3,385) Total return swap contracts ( 596) ( 1,526) ( 5,547) ( 2,535) Credit default swap contracts ( 135) 150 ( 280) 150 Foreign exchange contracts ( 1,609) 302 ( 1,548) ( 326) Commodity futures contracts 110 ( 346) ( 913) ( 1,066) Currency futures contracts 633 70 1,923 72 Interest rate futures contracts ( 1,007) 174 ( 1,909) 156 Net losses $ ( 1,748) $ ( 2,624) $ ( 13,315) $ ( 6,934) In addition to the derivative contracts described above, certain consolidated seed investments may utilize derivative financial instruments within their portfolios in pursuit of their stated investment objectives. |
Fair Value of Assets and Liabil
Fair Value of Assets and Liabilities Measured at Fair Value on a Recurring Basis | 9 Months Ended |
Jul. 31, 2019 | |
Fair Value of Assets and Liabilities Measured at Fair Value on a Recurring Basis [Abstract] | |
Fair Value of Assets and Liabilities Measured at Fair Value on a Recurring Basis | 6. Fair Value of Assets and Liabilities Measured at Fair Value on a Recurring Basis The following tables summarize financial assets and liabilities measured at fair value on a recurring basis and their assigned levels within the valuation hierarchy: July 31, 2019 (1) (in thousands) Level 1 Level 2 Level 3 Other Assets Not Held at Fair Value Total Financial assets: Cash equivalents $ 17,267 $ 92,817 $ - $ - $ 110,084 Investments held at fair value: Debt securities: Short-term - 250,088 - - 250,088 Held by consolidated sponsored funds - 336,440 - - 336,440 Held in separately managed accounts - 52,017 - - 52,017 Equity securities: Held by consolidated sponsored funds 68,824 145,878 - - 214,702 Held in separately managed accounts 20,068 91 - - 20,159 Non-consolidated sponsored funds and other 7,783 508 - - 8,291 Investments held at cost (2) - - - 20,904 20,904 Investments in non-consolidated CLO entities (3) - - - 1,251 1,251 Investments in equity method investees (2) - - - 140,174 140,174 Derivative instruments - 1,437 - - 1,437 Assets of consolidated CLO entities: Bank loans and other investments - 1,703,576 2,774 - 1,706,350 Total financial assets $ 113,942 $ 2,582,852 $ 2,774 $ 162,329 $ 2,861,897 Financial liabilities: Derivative instruments $ - $ 15,185 $ - $ - $ 15,185 Liabilities of consolidated CLO entities: Senior and subordinated note obligations - 1,620,598 - - 1,620,598 Total financial liabilities $ - $ 1,635,783 $ - $ - $ 1,635,783 October 31, 2018 (1) (in thousands) Level 1 Level 2 Level 3 Other Assets Not Held at Fair Value Total Financial assets: Cash equivalents $ 23,262 $ 116,070 $ - $ - $ 139,332 Investments held at fair value: Debt securities: Short-term - 273,320 - - 273,320 Held by consolidated sponsored funds 12,834 392,139 - - 404,973 Held in separately managed accounts 521 64,539 - - 65,060 Equity securities: Held by consolidated sponsored funds 73,291 62,318 - - 135,609 Held in separately managed accounts 23,642 419 - - 24,061 Non-consolidated sponsored funds and other 7,112 3,217 - - 10,329 Investments held at cost (2) - - - 20,874 20,874 Investments in non-consolidated CLO entities (3) - - - 2,895 2,895 Investments in equity method investees (2) - - - 141,506 141,506 Derivative instruments - 6,347 - - 6,347 Assets of consolidated CLO entities: Bank loans and other investments - 872,757 1,547 - 874,304 Total financial assets $ 140,662 $ 1,791,126 $ 1,547 $ 165,275 $ 2,098,610 Financial liabilities: Derivative instruments $ - $ 4,446 $ - $ - $ 4,446 Liabilities of consolidated CLO entities: Senior and subordinated note obligations - 873,008 - - 873,008 Total financial liabilities $ - $ 877,454 $ - $ - $ 877,454 (1) Amounts at July 31, 2019 reflect the adoption of ASU 2016-01. Amounts at October 31, 2018 reflect accounting guidance prior to the adoption of ASU 2016-01. See Note 1 for further information. (2) These investments are not measured at fair value in accordance with U.S. GAAP. (3) Investments in non-consolidated CLO entities are carried at amortized cost unless facts or circumstances indicate that the investments have been impaired, at which time the investments are written down to fair value as measured using level 3 inputs. A description of the valuation techniques and the inputs used in recurring fair value measurements is included immediately below. There have been no changes in the Company’s valuation techniques in the current reporting period. Cash equivalents Cash equivalents include investments in money market mutual funds, government agency securities, certificates of deposit and commercial paper with original (remaining) maturities to the Company of less than three months, as determined upon the purchase of each security. Cash investments in daily redeemable, actively traded money market mutual funds are valued using published net asset values and are categorized as Level 1 within the fair value measurement hierarchy. Government agency securities are valued based upon quoted market prices for similar assets in active markets, quoted prices for identical or similar assets that are not active and inputs other than quoted prices that are observable or corroborated by observable market data. The carrying amounts of certificates of deposit and commercial paper are measured at amortized cost, which approximates fair value due to the short time between the purchase and expected maturity of these investments. Depending on the categorization of the significant inputs, these assets are generally categorized in their entirety as Level 1 or 2 within the fair value measurement hierarchy. Debt securities held at fair value Debt securities held at fair value consist of short-term debt securities held directly by the Company comprised of certificates of deposit, commercial paper and corporate debt obligations with original (remaining) maturities to the Company ranging from three months to 12 months, as determined upon the purchase of each security, as well as investments in debt securities held in portfolios of consolidated sponsored funds and separately managed accounts. Short-term debt securities held are generally valued on the basis of valuations provided by third-party pricing services, as derived from such services’ pricing models. Inputs to the models may include, but are not limited to, reported trades, executable bid and ask prices, broker-dealer quotations, prices or yields of securities with similar characteristics, benchmark curves or information pertaining to the issuer, as well as industry and economic events. The pricing services may use a matrix approach, which considers information regarding securities with similar characteristics to determine the valuation for a security. These assets are generally categorized as Level 2 within the fair value measurement hierarchy. Debt securities held in portfolios of consolidated sponsored funds and separately managed accounts are generally valued on the basis of valuations provided by third-party pricing services as described above for short-term debt securities. Debt securities purchased with an original (remaining) maturity of 60 days or less (excluding those that are non-U.S. denominated, which typically are valued by a third-party pricing service or dealer quotes) are generally valued at amortized cost, which approximates fair value. Depending on the categorization of the significant inputs, debt securities held in portfolios of consolidated sponsored funds are generally categorized in their entirety as Level 1 or 2 within the fair value measurement hierarchy. Equity securities held at fair value Equity securities measured at fair value on a recurring basis consist of domestic and foreign equity securities held in portfolios of consolidated sponsored funds and separately managed accounts and investments in non-consolidated sponsored or other funds. Equity securities are valued at the last sale, official close or, if there are no reported sales on the valuation date, at the mean between the latest available bid and ask prices on the primary exchange on which they are traded. When valuing foreign equity securities that meet certain criteria, the portfolios use a fair value service that values such securities to reflect market trading that occurs after the close of the applicable foreign markets of comparable securities or other instruments that have a strong correlation to the fair-valued securities. In addition, the Company performs its own independent back test review of fair values versus the subsequent local market opening prices when available. Depending on the categorization of the significant inputs, these assets are generally categorized in their entirety as Level 1 or 2 within the fair value measurement hierarchy. Equity investments in sponsored or other mutual funds are valued using the published net asset value per share and are classified as Level 1 within the fair value measurement hierarchy. Investments in sponsored private open-end funds are not listed on an active exchange but calculate a net asset value per share (or equivalent) as of the Company’s reporting date in a manner consistent with mutual funds. These investments do not have any redemption restrictions and are not probable of being sold at an amount different from their calculated net asset value per share (or equivalent). Accordingly, investments in sponsored private open-end funds are measured at fair value based on the net asset value per share (or equivalent) of the investment as a practical expedient and are categorized as Level 2 within the fair value measurement hierarchy. The Company does not have any unfunded commitments related to investments in sponsored private mutual funds at July 31, 2019 and October 31, 2018. Derivative instruments Derivative instruments, further discussed in Note 5, are recorded as either other assets or other liabilities on the Company’s Consolidated Balance Sheets. Future and swap contracts are valued using a third-party pricing service that determines fair value based on bid and ask prices. Foreign exchange contracts are valued by interpolating a value using the spot foreign exchange rate and forward points, which are based on spot rate and currency interest rate differentials. Derivative instruments generally are classified as Level 2 within the fair value measurement hierarchy. Assets of consolidated CLO entities Consolidated CLO entity assets include investments in bank loans and equity securities. Fair value is determined utilizing unadjusted quoted market prices when available. Equity securities held by consolidated CLO entities are valued using the same techniques as described above for equity securities. Interests in senior floating-rate loans for which reliable market quotations are readily available are valued generally at the average mid-point of bid and ask quotations obtained from a third-party pricing service. Fair value may also be based upon valuations obtained from independent third-party brokers or dealers utilizing matrix pricing models that consider information regarding securities with similar characteristics. In certain instances, fair value has been determined utilizing discounted cash flow analyses or single broker non-binding quotes. Depending on the categorization of the significant inputs, these assets are generally categorized as Level 2 or 3 within the fair value measurement hierarchy. Liabilities of consolidated CLO entities Consolidated CLO entity liabilities include senior and subordinated note obligations. Fair value is determined using the measurement alternative to ASC 820 for collateralized financing entities. In accordance with the measurement alternative, the fair value of CLO liabilities was measured as the fair value of CLO assets less the sum of (i) the fair value of the beneficial interests held by the Company and (ii) the carrying value of any beneficial interests that represent compensation for services. Although both Level 2 and Level 3 inputs were used to measure the fair value of the CLO liabilities, the senior note obligations are classified as Level 2 within the fair value measurement hierarchy as the Level 3 inputs used were not significant. Level 3 assets and liabilities The following table shows a reconciliation of the beginning and ending fair value measurements of assets and liabilities valued on a recurring basis and classified as Level 3 within the fair value measurement hierarchy: Bank Loans and Other Investments of Consolidated CLO Entities Three Months Ended Nine Months Ended (in thousands) July 31, 2019 July 31, 2019 Beginning balance $ 1,138 $ 1,547 Paydowns ( 7) ( 19) Net gains (losses) included in net income 320 ( 77) Consolidation of CLO entities (1) 1,323 1,323 Ending balance $ 2,774 $ 2,774 (1) Represents Level 3 bank loans and other investments held by consolidated CLO entities upon the initial consolidation of these entities during the period. Bank Loans and Other Investments of Consolidated CLO Entities Three and Nine Months Ended (in thousands) July 31, 2018 Beginning balance $ - Consolidation of CLO entities (1) 2,388 Ending balance $ 2,388 (1) Represents Level 3 bank loans and other investments held by consolidated CLO entities upon the initial consolidation of these entities during the period. Financial Assets and Liabilities Not Measured at Fair Value Certain financial instruments are not carried at fair value, but their fair value is required to be disclosed. The following is a summary of the carrying amounts and estimated fair values of these financial instruments: July 31, 2019 October 31, 2018 (in thousands) Carrying Value Fair Value Fair Value Level Carrying Value Fair Value Fair Value Level Loan to affiliate $ 5,000 $ 5,000 3 $ 5,000 $ 5,000 3 Debt $ 620,304 $ 648,509 2 $ 619,678 $ 607,391 2 As discussed in Note 18, on December 23, 2015, Eaton Vance Management Canada Ltd. (EVMC), a wholly-owned subsidiary of the Company, loaned $ 5.0 million to Hexavest under a term loan agreement to seed a new investment strategy. The carrying value of the loan approximates fair value. The fair value is determined annually using a cash flow model that projects future cash flows based upon contractual obligations, to which the Company then applies an appropriate discount rate. The fair value of the Company’s debt has been determined based on quoted prices in inactive markets. |
Acquisitions
Acquisitions | 9 Months Ended |
Jul. 31, 2019 | |
Acquisitions [Abstract] | |
Acquisitions | 7. Acquisitions Atlanta Capital Management Company, LLC (Atlanta Capital) In fiscal 2017, the Company exercised a series of call options through which it purchased the remaining direct profit interests held by non-controlling interest holders of Atlanta Capital pursuant to the provisions of the original Atlanta Capital acquisition agreement, as amended, for $ 3.2 million, of which $ 2.5 million settled in cash in the first quarter of fiscal 2018. Atlanta Capital Plan In fiscal 2018 and 2017, the Company exercised a series of call options through which it purchased $ 8.2 million and $ 4.2 million, respectively, of indirect profit interests held by non-controlling interest holders of Atlanta Capital pursuant to the provisions of the Atlanta Capital Management Company, LLC Long-term Equity Incentive Plan (the Atlanta Capital Plan). These transactions settled in cash in the first quarter of fiscal 2019 and 2018, respectively. Total profit interests in Atlanta Capital held by non-controlling interest holders issued pursuant to the Atlanta Capital Plan were 9.8 percent as of both July 31, 2019 and October 31, 2018. The estimated fair value of these interests was $ 27.4 million and $ 26.3 million at July 31, 2019 and October 31, 2018, respectively, and is included as a component of temporary equity on the Consolidated Balance Sheets. Parametric Portfolio Associates LLC (Parametric) Total profit interests in Parametric held by non-controlling interest holders decreased to 4.9 percent as of July 31, 2019 from 5.1 percent as of October 31, 2018. Total capital interests in Parametric held by non-controlling interest holders decreased to 0.6 percent as of July 31, 2019 from 0.8 percent as of October 31, 2018, as described below. Clifton In December 2012, Parametric acquired Clifton. As part of the transaction, the Company issued a 1.9 percent profit interest and a 1.9 percent capital interest in Parametric Portfolio LP (Parametric LP) to certain employees. In the first quarter of fiscal 2018, the Company exercised a series of call options through which it acquired the remaining 0.5 percent profit interest and 0.5 percent capital interests in Parametric held by non-controlling interest holders related to the Clifton acquisition for $ 8.4 million. Parametric Risk Advisors In November 2013, the non‐controlling interest holders of Parametric Risk Advisors entered into a Unit Acquisition Agreement with Parametric to exchange their remaining 20 percent ownership interests in Parametric Risk Advisors for additional ownership interests in Parametric LP, whose sole asset is ownership interests in Parametric. As a result of this exchange, Parametric Risk Advisors became a wholly‐owned subsidiary of Parametric. The Parametric LP ownership interests issued in the exchange represent a 0.8 percent profit interest and a 0.8 percent capital interest, and contain put and call features that become exercisable over a four‐year exercised a series of call options through which it purchased a 0.2 percent profit interest and a 0.2 percent capital interest for $ 4.0 million. Total profit interests and total capital interests in Parametric LP held by non-controlling interest holders each decreased to 0.6 percent as of July 31, 2019 from 0.8 percent as of October 31, 2018. The estimated fair value of these interests was $ 11.9 million and $ 15.9 million at July 31, 2019 and October 31, 2018, respectively, and is included as a component of temporary equity on the Consolidated Balance Sheets. Parametric Plan In fiscal 2018 and 2017, the Company exercised a series of call options through which it purchased $ 5.9 million and $ 5.7 million, respectively, of profit interests held by non-controlling interest holders of Parametric pursuant to the provisions of the Parametric Portfolio Associates LLC Long-term Equity Plan (the Parametric Plan). These transactions settled in cash in the first quarter of fiscal 2019 and 2018, respectively. Total profit interests in Parametric held by non-controlling interest holders issued pursuant to the Parametric Plan were 4.3 percent as of both July 31, 2019 and October 31, 2018. The estimated fair value of these interests was $ 48.7 million and $ 47.9 million at July 31, 2019 and October 31, 2018, respectively, and is included as a component of temporary equity on the Consolidated Balance Sheets. |
Intangible Assets
Intangible Assets | 9 Months Ended |
Jul. 31, 2019 | |
Intangible Assets [Abstract] | |
Intangible Assets | 8. Intangible Assets The following is a summary of intangible assets: July 31, 2019 (in thousands) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Amortizing intangible assets: Client relationships acquired $ 134,247 $ ( 115,034) $ 19,213 Intellectual property acquired 1,025 ( 569) 456 Trademark acquired 4,257 ( 1,466) 2,791 Research system acquired 639 ( 550) 89 Non-amortizing intangible assets: Mutual fund management contracts acquired 54,408 - 54,408 Total $ 194,576 $ ( 117,619) $ 76,957 October 31, 2018 (in thousands) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Amortizing intangible assets: Client relationships acquired $ 134,247 $ ( 111,591) $ 22,656 Intellectual property acquired 1,025 ( 519) 506 Trademark acquired 4,257 ( 1,190) 3,067 Research system acquired 639 ( 391) 248 Non-amortizing intangible assets: Mutual fund management contracts acquired 54,408 - 54,408 Total $ 194,576 $ ( 113,691) $ 80,885 Amortization expense was $ 1.0 million and $ 2.2 million for the three months ended July 31, 2019 and 2018, respectively, and $ 3.9 million and $ 6.7 million for the nine months ended July 31, 2019 and 2018, respectively. Estimated remaining amortization expense for fiscal 2019 and the next five fiscal years, on a straight-line basis, is as follows: Estimated Year Ending October 31, Amortization (in thousands) Expense Remaining 2019 $ 1,050 2020 3,807 2021 2,282 2022 2,154 2023 1,754 2024 1,679 |
Revenue
Revenue | 9 Months Ended |
Jul. 31, 2019 | |
Revenue [ Abstract] | |
Revenue | 9. Revenue The following table disaggregates total revenue by source: Three Months Ended Nine Months Ended July 31, July 31, (in thousands) 2019 2018 2019 2018 Management fees: Sponsored funds $ 256,620 $ 257,554 $ 742,750 $ 757,217 Separate accounts 119,127 111,407 343,131 329,677 Total management fees 375,747 368,961 1,085,881 1,086,894 Distribution and underwriter fees: Distribution fees 15,317 19,360 49,168 58,113 Underwriter commissions 5,964 5,378 15,257 15,729 Total distribution and underwriter fees 21,281 24,738 64,425 73,842 Service fees 31,855 31,053 90,801 90,867 Other revenue 2,352 3,939 8,405 10,024 Total revenue $ 431,235 $ 428,691 $ 1,249,512 $ 1,261,627 The following table disaggregates total management fee revenue by investment mandate: Three Months Ended Nine Months Ended July 31, July 31, (in thousands) 2019 2018 2019 2018 Equity $ 180,081 $ 176,205 $ 516,290 $ 522,240 Fixed income 73,514 65,209 209,344 193,419 Floating-rate income 48,906 53,944 151,989 155,640 Alternative 15,371 22,470 45,672 65,582 Portfolio implementation 47,046 40,165 131,082 116,957 Exposure management 10,829 10,968 31,504 33,056 Total management fees $ 375,747 $ 368,961 $ 1,085,881 $ 1,086,894 Management fees and other receivables reported in the Company’s Consolidated Balance Sheet include $ 229.0 million and $ 221.4 million of receivables from contracts with customers at July 31, 2019 and October 31, 2018, respectively. The amount of deferred revenue reported in other liabilities in the Company’s Consolidated Balance Sheet was $ 6.8 million and $ 4.9 million at July 31, 2019 and October 31, 2018, respectively. The entire deferred revenue balance at the end of any given reporting period is expected to be recognized as management fee revenue in the immediate subsequent quarter. |
Stock-Based Compensation Plans
Stock-Based Compensation Plans | 9 Months Ended |
Jul. 31, 2019 | |
Stock-Based Compensation Plans [Abstract] | |
Stock-Based Compensation Plans | 10. Stock-Based Compensation Plans The compensation cost recognized by the Company related to its stock-based compensation plans are as follows: Three Months Ended Nine Months Ended July 31, July 31, (in thousands) 2019 2018 2019 2018 Omnibus Incentive Plans: Stock options $ 6,212 $ 5,931 $ 16,774 $ 18,337 Restricted shares 14,827 13,897 43,327 39,974 Deferred stock units (1) 121 49 860 978 Employee Stock Purchase Plans 179 312 355 793 Employee Stock Purchase Incentive Plan 90 129 467 818 Atlanta Capital Plan 569 743 1,709 2,227 Atlanta Capital Phantom Incentive Plan 274 143 813 424 Parametric Plan 368 794 1,708 2,383 Parametric Phantom Incentive Plan 901 842 2,814 2,343 Total stock-based compensation expense $ 23,541 $ 22,840 $ 68,827 $ 68,277 (1) In the fourth quarter of fiscal 2018, the Company changed the description of phantom stock units to deferred stock units. The change in the description had no impact on, nor does it constitute a restatement of, the Company's previously reported amounts attributable to these awards. The total income tax benefit recognized for stock-based compensation arrangements was $ 5.7 million and $ 5.8 million for the three months ended July 31, 2019 and 2018, respectively, and $ 15.9 million and $ 16.7 million for the nine months ended July 31, 2019 and 2018, respectively. Stock options Stock option transactions under the Company’s 2013 Omnibus Incentive Plan (the 2013 Plan) and predecessor plans for the nine months ended July 31, 2019 were as follows: (share and intrinsic value amounts in thousands) Shares Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (in years) Aggregate Intrinsic Value Options outstanding, beginning of period 16,760 $ 35.23 Granted 2,469 45.37 Exercised ( 803) 29.14 Forfeited/expired ( 60) 40.44 Options outstanding, end of period 18,366 $ 36.84 5.7 $ 153,855 Options exercisable, end of period 9,692 $ 32.98 3.9 $ 112,735 The Company received $ 22.9 million and $ 54.7 million related to the exercise of options for the nine months ended July 31, 2019 and 2018, respectively. As of July 31, 2019, compensation cost of $ 44.7 million related to unvested stock options granted under the 2013 Plan and predecessor plans has not yet been recognized. That cost is expected to be recognized over a weighted-average period of 2.5 years. Restricted shares A summary of the Company’s restricted share activity for the nine months ended July 31, 2019 under the 2013 Plan is as follows: Weighted- Average Grant Date (share figures in thousands) Shares Fair Value Unvested, beginning of period 4,544 $ 40.70 Granted 1,746 44.87 Vested ( 1,315) 39.23 Forfeited ( 100) 42.95 Unvested, end of period 4,875 $ 42.55 As of July 31, 2019, there was $ 137.6 million of compensation cost related to unvested restricted shares granted under the 2013 Plan not yet recognized. That cost is expected to be recognized over a weighted-average period of 2.9 years. Deferred stock units Deferred stock units issued to non-employee Directors under the 2013 Plan are accounted for as liability awards. Deferred stock units granted after November 1, 2017 are considered fully vested on the grant date and the entire fair value of these awards is recognized as compensation cost on the date of grant. During the nine months ended July 31, 2019, 19,429 deferred stock units were issued to non-employee Directors pursuant to the 2013 Plan. The total liability attributable to deferred stock units included as a component of accrued compensation on the Company’s Consolidated Balance Sheet was $ 1.6 million and $ 1.3 million as of July 31, 2019 and October 31, 2018, respectively. The Company made cash payments of $ 0.5 million and $ 0.4 million, in the first quarter of fiscal 2019 and 2018, respectively, to settle deferred stock unit award liabilities. |
Common Stock Repurchases
Common Stock Repurchases | 9 Months Ended |
Jul. 31, 2019 | |
Common Stock Repurchases [Abstract] | |
Common Stock Repurchases | 11. Common Stock Repurchases The Company’s current Non-Voting Common Stock share repurchase program was authorized on July 10, 2019. The Board authorized management to repurchase and retire up to 8.0 million shares of its Non-Voting Common Stock on the open market and in private transactions in accordance with applicable securities laws. The timing and amount of share purchases are subject to management’s discretion. The Company’s share repurchase program is not subject to an expiration date. In the first nine months of fiscal 2019, the Company purchased and retired approximately 0.4 million shares of its Non-Voting Common Stock under the current repurchase authorization and approximately 5.8 million shares under a previous repurchase authorization. Approximately 7.6 million additional shares may be repurchased under the current authorization as of July 31, 2019. |
Non-operating Income (Expense)
Non-operating Income (Expense) | 9 Months Ended |
Jul. 31, 2019 | |
Non-operating Income (Expense) [Abstract] | |
Non-operating Income (Expense) | 12. Non-operating Income (Expense) The components of non-operating income (expense) were as follows: Three Months Ended Nine Months Ended July 31, July 31, (in thousands) 2019 2018 2019 2018 Interest and other income $ 11,507 $ 10,247 $ 32,861 $ 26,616 Net gains (losses) on investments and derivatives (1) 3,440 ( 3,120) 3,509 ( 16,453) Net foreign currency gains (losses) ( 101) 4 ( 485) ( 695) Gains and other investment income, net 14,846 7,131 35,885 9,468 Interest expense ( 5,888) ( 5,906) ( 17,907) ( 17,716) Other income (expense) of consolidated CLO entities: Interest income 22,268 4,505 49,077 6,193 Net losses on bank loans and other investments and note obligations ( 4,008) ( 2,658) ( 3,582) ( 1,370) Gains and other investment income, net 18,260 1,847 45,495 4,823 Structuring and closing fees ( 5,429) - ( 5,548) - Interest expense ( 16,319) ( 3,092) ( 35,357) ( 3,630) Interest and other expense ( 21,748) ( 3,092) ( 40,905) ( 3,630) Total non-operating income (expense) $ 5,470 $ ( 20) $ 22,568 $ ( 7,055) (1) The nine months ended July 31, 2018 includes the $ 6.5 million loss associated with the Company's determination not to exercise the option to acquire an additional 26 percent ownership in Hexavest. |
Income Taxes
Income Taxes | 9 Months Ended |
Jul. 31, 2019 | |
Income Tax [Abstract] | |
Income Taxes | 13. Income Taxes The provision for income taxes was $ 36.3 million and $ 37.2 million, or 25.5 percent and 26.2 percent of pre-tax income, for the three months ended July 31, 2019 and 2018, respectively. The provision for income taxes was $ 101.0 million and $ 119.9 million, or 24.8 percent and 29.7 percent of pre-tax income, for the nine months ended July 31, 2019 and 2018, respectively. The following table reconciles the statutory federal income tax rate to the Company’s effective income tax rate: Three Months Ended Nine Months Ended July 31, July 31, 2019 2018 2019 2018 Statutory U.S. federal income tax rate (1) 21.0 % 23.3 % 21.0 % 23.3 % State income tax, net of federal income tax benefits 5.0 % 4.4 % 4.6 % 4.3 % Net income attributable to non-controlling and other beneficial interests - 1.3 % - 1.0 % - 1.0 % - 0.9 % Non-recurring impact of U.S. tax reform - % - % - % 6.1 % Net excess tax benefits from stock-based compensation plans (2) - 0.4 % - 0.9 % - 0.9 % - 3.7 % Other items 1.2 % 0.4 % 1.1 % 0.6 % Effective income tax rate 25.5 % 26.2 % 24.8 % 29.7 % (1) The Company's statutory U.S. federal income tax rate for fiscal 2019 is 21 percent based on the Tax Cuts and Jobs Act (2017 Tax Act). The Company's statutory U.S. federal income tax rate for fiscal 2018 was a blend of 35 percent and 21 percent based on the number of days in the Company's fiscal year before and after the January 1, 2018 effective date of the reduction in the federal corporate income tax rate pursuant to the 2017 Tax Act. (2) Reflects the impact of the adoption of ASU 2016-09, Improvements to Employee Share-Based Payment Accounting, which was adopted by the Company in the first quarter of fiscal 2018. The Company’s income tax provision for the three months ended July 31, 2019 includes $ 1.1 million of charges associated with certain provisions of the 2017 Tax Act taking effect for the Company in fiscal 2019, relating principally to limitations on the deductibility of executive compensation. The Company’s income tax provision was reduced by net excess tax benefits related to the exercise of employee stock options and vesting of restricted stock awards during the period totaling $ 0.6 million and $ 1.3 million for the three months ended July 31, 2019 and 2018, respectively. In addition, the Company’s income tax provision for the three months ended July 31, 2019 and 2018 was reduced by $ 2.2 million and $ 1.7 million, respectively, related to the net income attributable to redeemable non-controlling interests and other beneficial interests, which is not taxable to the Company. The Company’s income tax provision for the first nine months of fiscal 2019 includes $ 2.4 million of charges associated with certain provisions of the 2017 Tax Act taking effect for the Company in fiscal 2019, relating principally to limitations on the deductibility of executive compensation. The increase in the effective tax rate resulting from this charge is offset by an income tax benefit of $ 3.9 million related to the exercise of employee stock options and vesting of restricted stock awards during the period, and $ 5.3 million related to the net income attributable to redeemable non-controlling interests and other beneficial interests, which is not taxable to the Company. The Company’s income tax provision for the first nine months of fiscal 2018 includes a non-recurring charge of approximately $ 24.8 million to reflect the effect of the 2017 Tax Act. The non-recurring charge was considered to be a provisional estimate under the U.S. Securities and Exchange Commission Staff Accounting Bulletin 118 (SAB 118) and included $ 21.7 million from the revaluation of the Company’s deferred tax assets and liabilities, and $ 3.1 million for the deemed repatriation of foreign-sourced net earnings not previously subject to U.S. taxation. The increase in the Company’s effective tax rate resulting from this charge was partially offset by an income tax benefit of $ 15.1 million related to the exercise of employee stock options and vesting of restricted stock awards during the period, and $ 4.5 million related to the net income attributable to redeemable non-controlling interests and other beneficial interests, which is not taxable to the Company. As of July 31, 2019 and October 31, 2018, no valuation allowance has been recorded for deferred tax assets, reflecting management’s belief that all deferred tax assets will be utilized. As of July 31, 2019, the Company considers the undistributed earnings of certain foreign subsidiaries to be indefinitely reinvested in foreign operations. The Company no longer considers the undistributed earnings of its Canadian subsidiary to be indefinitely reinvested in foreign operations. This change in assertion allowed the Canadian subsidiary to declare and pay a $ 65.2 million dividend in April 2019 to its U.S. parent company, which is a wholly-owned subsidiary of the Company. There was no financial statement impact related to this dividend as all previously undistributed earnings from the Canadian subsidiary were subject to taxation in fiscal 2018 due to the 2017 Tax Act. The dividend did, however, result in a tax expense reduction in the amount of $ 0.5 million due to a realized foreign exchange loss. As of July 31, 2019, the Company had approximately $ 16.6 million of undistributed earnings primarily from foreign operations in the United Kingdom that are not available to fund domestic operations or to distribute to shareholders unless repatriated. As a result of the 2017 Tax Act and foreign exchange rates as of July 31, 2019, there is no future tax liability with respect to undistributed earnings. The Company is generally no longer subject to income tax examinations by U.S. federal, state, local or non-U.S. taxing authorities for fiscal years prior to fiscal 2015. |
Non-controlling and Other Benef
Non-controlling and Other Beneficial Interests | 9 Months Ended |
Jul. 31, 2019 | |
Non Controlling and Other Beneficial Interests [Abstract] | |
Non-controlling and Other Beneficial Interests | 14. Non-controlling and Other Beneficial Interests The components of net income attributable to non-controlling and other beneficial interests were as follows: Three Months Ended Nine Months Ended July 31, July 31, (in thousands) 2019 2018 2019 2018 Consolidated sponsored funds $ ( 2,760) $ ( 1,862) $ ( 13,323) $ ( 4,215) Majority-owned subsidiaries ( 3,555) ( 4,119) ( 9,774) ( 12,026) Net income attributable to non-controlling and other beneficial interests $ ( 6,315) $ ( 5,981) $ ( 23,097) $ ( 16,241) |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 9 Months Ended |
Jul. 31, 2019 | |
Accumulated Other Comprehensive Income (Loss) [Abstract] | |
Accumulated Other Comprehensive Income (Loss) | 15. Accumulated Other Comprehensive Income (Loss) The components of accumulated other comprehensive income (loss), net of tax, for the three months ended July 31, 2019 and 2018 are as follows: (in thousands) Unamortized Net Gains on Cash Flow Hedges (1) Net Unrealized Gains on Available-for-Sale Investments (2) Foreign Currency Translation Adjustments Total Balance at April 30, 2019 $ 150 $ - $ ( 61,765) $ ( 61,615) Other comprehensive income, before reclassifications and tax - - 1,703 1,703 Tax impact - - - - Reclassification adjustments, before tax ( 33) - - ( 33) Tax impact 10 - - 10 Net current period other comprehensive income (loss) ( 23) - 1,703 1,680 Balance at July 31, 2019 $ 127 $ - $ ( 60,062) $ ( 59,935) Balance at April 30, 2018 $ 251 $ 5,160 $ ( 49,884) $ ( 44,473) Other comprehensive income (loss), before reclassifications and tax - 514 ( 4,585) ( 4,071) Tax impact - ( 114) - ( 114) Reclassification adjustments, before tax ( 33) ( 1,861) - ( 1,894) Tax impact 8 434 - 442 Net current period other comprehensive loss ( 25) ( 1,027) ( 4,585) ( 5,637) Balance at July 31, 2018 $ 226 $ 4,133 $ ( 54,469) $ ( 50,110) The components of accumulated other comprehensive income (loss), net of tax, for the nine months ended July 31, 2019 and 2018 are as follows: (in thousands) Unamortized Net Gains on Cash Flow Hedges (1) Net Unrealized Gains on Available-for-Sale Investments Foreign Currency Translation Adjustments Total Balance at October 31, 2018 $ 200 $ 3,714 $ ( 57,095) $ ( 53,181) Cumulative effect adjustment upon adoption of new accounting standard (ASU 2016-01) (2) - ( 3,714) - ( 3,714) Balance at November 1, 2018, as adjusted 200 - ( 57,095) ( 56,895) Other comprehensive loss, before reclassifications and tax - - ( 2,967) ( 2,967) Tax impact - - - - Reclassification adjustments, before tax ( 100) - - ( 100) Tax impact 27 - - 27 Net current period other comprehensive loss ( 73) - ( 2,967) ( 3,040) Balance at July 31, 2019 $ 127 $ - $ ( 60,062) $ ( 59,935) Balance at October 31, 2017 $ 301 $ 4,128 $ ( 51,903) $ ( 47,474) Other comprehensive income (loss), before reclassifications and tax - 1,890 ( 2,566) ( 676) Tax impact - ( 458) - ( 458) Reclassification adjustments, before tax ( 99) ( 1,861) - ( 1,960) Tax impact 24 434 - 458 Net current period other comprehensive income (loss) ( 75) 5 ( 2,566) ( 2,636) Balance at July 31, 2018 $ 226 $ 4,133 $ ( 54,469) $ ( 50,110) (1) Amounts reclassified from accumulated other comprehensive income (loss), net of tax, represent the amortization of net gains (losses) on qualifying derivative financial instruments designated as cash flow hedges over the life of the Company's senior notes into interest expense on the Consolidated Statements of Income. (2) Upon adoption of ASU 2016-01 on November 1, 2018, unrealized holding gains, net of related income tax effects, attributable to investments in non-consolidated sponsored funds and other investments previously classified as available-for-sale investments were reclassified from accumulated other comprehensive income (loss) to retained earnings. |
Earnings per Share
Earnings per Share | 9 Months Ended |
Jul. 31, 2019 | |
Earnings per Share [Abstract] | |
Earnings per Share | 16. Earnings per Share The following table sets forth the calculation of earnings per basic and diluted shares: Three Months Ended Nine Months Ended July 31, July 31, (in thousands, except per share data) 2019 2018 2019 2018 Net income attributable to Eaton Vance Corp. shareholders $ 102,221 $ 101,794 $ 290,829 $ 276,451 Weighted-average shares outstanding – basic 109,111 114,610 110,553 115,157 Incremental common shares 4,353 8,131 3,957 8,396 Weighted-average shares outstanding – diluted 113,464 122,741 114,510 123,553 Earnings per share: Basic $ 0.94 $ 0.89 $ 2.63 $ 2.40 Diluted $ 0.90 $ 0.83 $ 2.54 $ 2.24 Antidilutive common shares related to stock options and unvested restricted stock excluded from the computation of earnings per diluted share were approximately 5.9 million and 1.8 million for the three months ended July 31, 2019 and 2018, respectively, and approximately 7.6 million and 2.1 million for the nine months ended July 31, 2019 and 2018, respectively. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Jul. 31, 2019 | |
Commitments and Contingencies [Abstract] | |
Commitments and Contingencies | 17. Commitments and Contingencies In the normal course of business, the Company enters into agreements that include indemnities in favor of third parties, such as engagement letters with advisors and consultants, information technology agreements, distribution agreements and service agreements. In certain circumstances, these indemnities in favor of third parties relate to service agreements entered into by investment funds advised by Eaton Vance Management, Boston Management and Research, or Calvert, all of which are direct or indirect wholly-owned subsidiaries of the Company. The Company has also agreed to indemnify its directors, officers and employees in accordance with the Company’s Articles of Incorporation, as amended. Certain agreements do not contain any limits on the Company’s liability and, therefore, it is not possible to estimate the Company’s potential liability under these indemnities. In certain cases, the Company has recourse against third parties with respect to these indemnities. Further, the Company maintains insurance policies that may provide coverage against certain claims under these indemnities. The Company and its subsidiaries are subject to various legal proceedings. In the opinion of management, after discussions with legal counsel, the ultimate resolution of these matters will not have a material effect on the consolidated financial condition, results of operations or cash flows of the Company. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Jul. 31, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 18. Related Party Transactions Sponsored funds Revenues for services provided or related to sponsored funds are as follows: Three Months Ended Nine Months Ended July 31, July 31, (in thousands) 2019 2018 (1) 2019 2018 (1) Management fees $ 256,620 $ 257,554 $ 742,750 $ 757,217 Distribution and underwriter fees 21,281 24,738 64,425 73,842 Service fees 31,855 31,053 90,801 90,867 Shareholder services fees included in other revenue 1,622 1,672 4,900 4,540 Total $ 311,378 $ 315,017 $ 902,876 $ 926,466 (1) Prior period amounts have been adjusted as a result of the retrospective adoption of ASU 2014-09. See Note 1, Summary of Significant Accounting Policies, for further information on the impact of the adoption of ASU 2014-09. For the three months ended July 31, 2019 and 2018, the Company discretionarily waived management fees of $ 5.0 million and $ 4.4 million, respectively. Separately, for these same periods, the Company provided subsidies to sponsored funds of $ 4.8 million and $ 6.6 million, respectively. For the nine months ended July 31, 2019 and 2018, the Company discretionarily waived management fees of $ 14.1 million and $ 13.0 million, respectively. Separately, for these same periods, the Company provided subsidies to sponsored funds of $ 21.9 million and $ 18.3 million, respectively. Fee waivers and fund subsidies are recognized as a reduction to management fees on the Consolidated Statements of Income. Sales proceeds and net realized gains (losses) from investments in non-consolidated sponsored funds are as follows: Three Months Ended Nine Months Ended July 31, July 31, (in thousands) 2019 2018 2019 2018 Proceeds from sales $ 1,206 $ 2,936 $ 7,831 $ 7,812 Net realized gains 286 2,066 5,490 1,961 The Company pays all ordinary operating expenses of certain sponsored funds (excluding investment advisory and administrative fees) for which it earns an all-in-management fee. For the three months ended July 31, 2019 and 2018, expenses of $ 3.0 million and $ 3.5 million, respectively, were incurred by the Company pursuant to these arrangements. For the nine months ended July 31, 2019 and 2018, expenses of $ 9.7 million and $ 10.2 million, respectively, were incurred by the Company pursuant to these arrangements. Included in management fees and other receivables at July 31, 2019 and October 31, 2018 are receivables due from sponsored funds of $ 105.0 million and $ 104.9 million, respectively, for services provided. Included in accounts payable and accrued expenses at July 31, 2019 and October 31, 2018 are payables due to sponsored funds of $ 2.4 million and $ 3.2 million, respectively, relating primarily to fund subsidies. Loan to affiliate On December 23, 2015, EVMC, a wholly owned subsidiary of the Company, loaned $ 5.0 million to Hexavest under a term loan agreement to seed a new investment strategy. The loan renews automatically for an additional one-year period on each anniversary date unless written termination notice is provided by EVMC. Through October 31, 2018, the Company earned interest equal to the one-year Canadian Dollar Offered Rate plus 200 basis points. In November 2018, the Company amended the term loan agreement to reduce the market interest rate of the loan to be equal to the one-year Canadian Dollar Offered Rate plus 100 basis points. Hexavest may prepay the loan in whole or in part at any time without penalty. For the three months ended July 31, 2019 and 2018, the Company recorded $ 45,000 and $, 50000, respectively, of interest income related to the loan in gains (losses) and other investment income, net, on the Company’s Consolidated Statement of Income. For both the nine months ended July 31, 2019 and 2018, the Company recorded $ 0.1 million of interest income related to the loan. Interest due from Hexavest under this arrangement included in other assets on the Company’s Consolidated Balance Sheets was $ 15,000 and $ 16,000 at July 31, 2019 and October 31, 2018, respectively. Employee loan program The Company has established an Employee Loan Program under which a program maximum of $ 20.0 million is available for loans to officers (other than executive officers) and other key employees of the Company for purposes of financing the exercise of employee stock options. Loans are written for a seven-year 0.9 percent to 2.9 percent), are payable in annual installments commencing with the third year in which the loan is outstanding, and are collateralized by the stock issued upon exercise of the option. All loans under the program must be made on or before October 31, 2022. Loans outstanding under this program, which are full recourse in nature, are reflected as notes receivable from stock option exercises in shareholders’ equity and totaled $ 7.9 million and $ 8.1 million at July 31, 2019 and October 31, 2018, respectively. |
Geographic Information
Geographic Information | 9 Months Ended |
Jul. 31, 2019 | |
Geographical Information [Abstract] | |
Geographic Information | 19. Geographic Information Revenues by principal geographic area are as follows: Three Months Ended Nine Months Ended July 31, July 31, (in thousands) 2019 2018 2019 2018 Revenue: U.S. (1) $ 415,746 $ 411,241 $ 1,202,869 $ 1,210,837 International (1) 15,489 17,450 46,643 50,790 Total $ 431,235 $ 428,691 $ 1,249,512 $ 1,261,627 (1) Prior period amounts have been adjusted as a result of the retrospective adoption of ASU 2014-09. See Note 1, Summary of Significant Accounting Policies, for further information on the impact of the adoption of ASU 2014-09. Long-lived assets by principal geographic area are as follows: July 31, October 31, (in thousands) 2019 2018 Long-lived Assets: U.S. $ 68,909 $ 50,459 International 1,625 1,969 Total $ 70,534 $ 52,428 International revenues and long-lived assets are attributed to countries based on the location in which revenues are earned and where the assets reside. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Jul. 31, 2019 | |
Summary of Significant Accounting Policies [Abstract] | |
Basis of presentation | Basis of presentation In the opinion of management, the accompanying unaudited interim Consolidated Financial Statements of Eaton Vance Corp. (the Company) include all normal recurring adjustments necessary to present fairly the results for the interim periods in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP). Such financial statements have been prepared in accordance with the instructions to Form 10-Q pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures have been omitted pursuant to such rules and regulations. As a result, these financial statements should be read in conjunction with the audited Consolidated Financial Statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended October 31, 2018. |
Adoption of new accounting standards | Adoption of new accounting standards The Company adopted the following accounting standards as of November 1, 2018: • Revenue recognition – Accounting Standards Update (ASU) 2014-09, Revenue from Contracts with Customers • Financial instruments – ASU 2016-01, Recognition and Measurement of Financial Assets and Liabilities • Statement of cash flows – ASU 2016-15, Classification of Certain Cash Receipts and Cash Payments • Statement of cash flows – ASU 2016-18, Restricted Cash Revenue recognition This guidance seeks to improve comparability by providing a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers. The guidance also changes the accounting for certain contract costs and revises the criteria for determining if an entity is acting as a principal or agent in certain arrangements. The Company adopted the new revenue recognition guidance using a full retrospective approach. The adoption of this guidance did not result in any significant changes to the timing of recognition and measurement of revenue or recognition of costs incurred to obtain and fulfill revenue contracts; however, the presentation of certain revenue and expense balances was affected. Notably, fund subsidies of $ 6.6 million and $ 18.3 million previously included as a component of fund-related expenses in the Consolidated Statements of Income for the three and nine months ended July 31, 2018, respectively, are now presented as a contra-revenue component of management fees. Separately, in applying the revised principal-versus-agent guidance to the Company’s various distribution contracts for certain classes of shares in sponsored funds with a front-end load commission pricing structure, the entire front-end load commission (including both the underwriting commission retained by the Company and the sales charge paid to the selling broker-dealer) is now presented gross within distribution and underwriting fee revenue and the sales charge paid to the selling broker-dealer is now presented within distribution expense in the Consolidated Statements of Income. Prior to the adoption of ASU 2014-09, only the underwriting commission retained by the Company was presented within distribution and underwriting fee revenue as the sales charge paid to the selling broker-dealer was recorded net. Accordingly, distribution and underwriter fees and distribution expense increased by approximately $ 4.6 million and $ 13.4 million for the three and nine months ended July 31, 2018, respectively, as a result of this change. Lastly, contingent deferred sales charges received, which were previously recorded as a reduction of deferred sales commission assets, are now being recorded as revenue within the distribution and underwriting fees line item in the Consolidated Statements of Income. The following tables present the effect of the changes in presentation made to prior periods which are attributable to the retrospective adoption of ASU 2014-09: Three Months Ended July 31, 2018 (in thousands) As Previously Reported Reclassification As Restated Revenue: Management fees $ 374,553 $ ( 5,592) $ 368,961 Distribution and underwriter fees 20,099 4,639 24,738 Service fees 31,260 ( 207) 31,053 Other revenue 4,690 ( 751) 3,939 Total revenue 430,602 ( 1,911) 428,691 Expenses: Compensation and related costs 152,921 - 152,921 Distribution expense 35,045 6,379 41,424 Service fee expense 28,760 ( 1,686) 27,074 Amortization of deferred sales commissions 4,637 - 4,637 Fund-related expenses 15,857 ( 6,604) 9,253 Other expenses 51,118 - 51,118 Total expenses 288,338 ( 1,911) 286,427 Operating income $ 142,264 $ - $ 142,264 Nine Months Ended July 31, 2018 (in thousands) As Previously Reported Reclassification As Restated Revenue: Management fees $ 1,101,929 $ ( 15,035) $ 1,086,894 Distribution and underwriter fees 60,393 13,449 73,842 Service fees 91,935 ( 1,068) 90,867 Other revenue 12,018 ( 1,994) 10,024 Total revenue 1,266,275 ( 4,648) 1,261,627 Expenses: Compensation and related costs 455,958 - 455,958 Distribution expense 105,219 18,672 123,891 Service fee expense 84,651 ( 5,057) 79,594 Amortization of deferred sales commissions 13,342 - 13,342 Fund-related expenses 46,036 ( 18,263) 27,773 Other expenses 150,319 - 150,319 Total expenses 855,525 ( 4,648) 850,877 Operating income $ 410,750 $ - $ 410,750 Financial instruments – recognition and measurement This guidance requires substantially all equity investments in unconsolidated entities (other than those accounted for under the equity method of accounting) with a readily determinable fair value to be measured at fair value with changes in fair value recognized in net income. The standard effectively eliminates the ability, at acquisition, to classify an equity investment as available-for-sale with holding gains and losses presented in other comprehensive income until realized. The Company adopted this provision of the new ASU using a modified retrospective approach. The Company held $ 10.3 million of available-for-sale equity investments in unconsolidated sponsored funds at October 31, 2018. Upon adoption, the Company recognized a $ 3.7 million cumulative effect adjustment (increase), net of related income tax effects, to reclassify unrealized holding gains attributable to these investments previously recognized in accumulated other comprehensive income (loss) to retained earnings. Prior period investments in unconsolidated sponsored mutual funds and private open-end funds previously classified as trading and available-for-sale are now referred to as “equity securities” within the notes to the financial statements; the prior period treatment of gains or losses arising from changes in the fair value of these investments was retained. The standard also provides for an election to measure certain investments without a readily determinable fair value at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer (the cost method). The Company adopted this provision of the ASU using a prospective approach. Statement of cash flows – classification This standard clarifies how certain cash receipts and cash payments are classified and presented on the Consolidated Statement of Cash Flows. The Company adopted ASU 2016-15 using a retrospective approach. The adoption of this standard did not result in any changes to the classification of prior period activity on the Company’s Consolidated Statements of Cash Flows. Statement of cash flows – restricted cash This standard requires the inclusion of restricted cash and restricted cash equivalents (restricted cash) with cash and cash equivalents when reconciling the beginning and ending amounts on the Consolidated Statement of Cash Flows. Restricted cash includes cash held by consolidated sponsored funds and consolidated collateralized loan obligation (CLO) entities. The Company adopted this new guidance using a retrospective approach. Accordingly, previously reported net changes in the restricted cash balances of consolidated sponsored funds and consolidated CLO entities, which totaled $ 35.9 million for the nine months ended July 31, 2018, are no longer presented as a component of the Company’s net cash provided by operating activities for that period. Conversely, an increase in cash due to initial consolidation was added as a separate component of net cash provided by operating activities for the nine months ended July 31, 2018 to reflect the restricted cash balance of a CLO entity initially consolidated during that period. A reconciliation of cash, cash equivalents, and restricted cash for all balance sheet periods presented is included in Note 2. In addition to the standards described above, the Company also early adopted the portion of ASU 2018-13, Fair Value Measurement: Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement, related to the removal of certain fair value disclosure requirements. The fair value disclosures required to be added under this new guidance will be effective for the fiscal year that begins on November 1, 2020. Where applicable, the Company’s significant accounting policies provided below have been updated to reflect the adoption of these new accounting standards as of November 1, 2018. |
Restricted cash | Restricted cash Restricted cash includes cash collateral required for margin accounts established to support derivative positions and other segregated cash to comply with certain regulatory requirements. Such derivatives are used to hedge certain investments in consolidated sponsored funds and separately managed accounts seeded for business development purposes (consolidated seed investments). Restricted cash also includes cash and cash equivalents held by consolidated sponsored funds and consolidated CLO entities, which are not available to the Company for its general operations. |
Investments | Investments Debt securities held at fair value Debt securities held at fair value consist of short-term debt securities held directly by the Company comprised of certificates of deposit, commercial paper and corporate debt obligations with original (remaining) maturities to the Company ranging from three months to 12 months, as determined upon the purchase of each security, as well as investments in debt securities held in portfolios of consolidated sponsored mutual funds and private open-end funds (sponsored funds) and separately managed accounts. Debt securities are measured at fair value with net realized and unrealized holding gains or losses, and interest and dividend income reflected as a component of gains (losses) and other investment income, net, on the Company’s Consolidated Statements of Income. The specific identified cost method is used to determine the realized gains or losses on all debt securities sold. Equity securities held at fair value Equity securities primarily consist of domestic and foreign equity securities held in portfolios of consolidated sponsored funds and separately managed accounts and investments in non-consolidated sponsored or other funds. Equity securities and investments in non-consolidated sponsored or other mutual funds with readily determinable fair values are measured at fair value based on quoted market prices and published net asset values per share, respectively. Investments in non-consolidated sponsored private open-end funds without readily determinable fair values are measured at fair value based on the net asset value per share (or equivalent) of the investment as a practical expedient. Equity investments without readily determinable fair values are measured at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer (the cost method). Investments held at cost are qualitatively evaluated for impairment each reporting period. If that qualitative assessment indicates that the investment held at cost is impaired, the fair value of the investment is estimated and an impairment loss is recognized equal to the difference between the fair value of the investment and its carrying amount. The cost method is no longer applied if the equity security subsequently has a readily determinable fair value or the Company irrevocably elects to measure the equity security at fair value. Net realized and unrealized holding gains or losses on equity securities, any observable price changes and/or impairment losses attributable to investments held at cost, and dividend income are all reflected within gains (losses) and other investment income, net, on the Company’s Consolidated Statements of Income. The specific identified cost method is used to determine the realized gains or losses on all equity securities sold. Investments in non-consolidated CLO entities Investments in non-consolidated CLO entities are carried at amortized cost unless impaired. The excess of actual and anticipated future cash flows over the initial investment at the date of purchase is recognized in gains (losses) and other investment income, net, over the life of the investment using the effective yield method. The Company reviews cash flow estimates throughout the life of each non-consolidated CLO entity. If the updated estimate of future cash flows (taking into account both timing and amounts) is less than the last estimate, an impairment loss is recognized to the extent the carrying amount of the investment exceeds its fair value. Investments in equity method investees Investments in non-controlled affiliates in which the Company’s ownership ranges from 20 to 50 percent, or in instances in which the Company is able to exercise significant influence but not control, are accounted for under the equity method of accounting. Under the equity method of accounting, the Company’s share of the investee’s underlying net income or loss is recorded as equity in net income of affiliates, net of tax. Distributions received from investees reduce the Company’s investment balance and are classified as cash flows either from operating activities or investing activities in the Company’s Consolidated Statements of Cash Flows as determined using the cumulative earnings method. Investments in equity method investees are evaluated for impairment as events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. If the carrying amounts of the assets exceed their respective fair values, additional impairment tests are performed to measure the amounts of the impairment losses, if any. |
Deferred sales commissions | Deferred sales commissions Sales commissions paid to broker‐dealers in connection with the sale of certain classes of shares of sponsored funds are generally deferred and amortized over the period during which redemptions by the purchasing shareholder are subject to a contingent deferred sales charge, which does not exceed five years from purchase. Distribution fees and contingent deferred sales charges received from these funds are recorded in revenue as earned. Should the Company lose its ability to recover such sales commissions through earning distribution fees, the value of its deferred sales commission asset would immediately decline, as would related future cash flows. The Company evaluates the carrying value of its deferred sales commission asset for impairment on a quarterly basis. In its impairment analysis, the Company compares the carrying value of the deferred sales commission asset to the undiscounted cash flows expected to be generated by the asset in the form of distribution fees over its remaining useful life to determine whether impairment has occurred. If the carrying value of the asset exceeds the undiscounted cash flows, the asset is written down to fair value based on discounted cash flows. Impairment adjustments are recognized in operating income as a component of amortization of deferred sales commissions. |
Revenue recognition | Revenue recognition The Company primarily earns revenue from providing asset management services, distribution and underwriter services and shareholder services to its sponsored fund and separate account customers through various contracts. Revenue is recognized for each distinct performance obligation identified in contracts with customers when the performance obligation has been satisfied by transferring services to a customer either over time or at a point in time (which is when the customer obtains control of the service). Revenue recognized is the amount of variable or fixed consideration allocated to the satisfied performance obligation that the Company expects to be entitled to in exchange for transferring such services to a customer (the transaction price). Variable consideration is included in the transaction price only when it is probable that a significant reversal of such revenue will not occur or when the uncertainty associated with the variable consideration is subsequently resolved (the constraint). The majority of the fees earned from providing asset management, distribution and shareholder services represent variable consideration as the revenue is largely dependent on the total value and composition of assets under management. The total value of assets under management fluctuates with the financial markets. These fees are constrained and excluded from the transaction price until the asset values on which the customer is billed are calculated and the value of consideration is measurable and no longer subject to financial market volatility. The timing of when the Company bills its customers and related payment terms vary in accordance with the agreed-upon contractual terms. A majority of the Company’s clients are billed after the service is performed, which results in the recording of accounts receivable and accrued revenue. Deferred revenue is recorded in instances where a client is billed in advance. Management fees The Company is entitled to receive management fees in exchange for asset management services provided to sponsored funds and separate accounts established for retail clients (either directly or indirectly through various third-party financial intermediaries that sponsor various active asset management and model-based active asset management investment programs), high net worth clients and institutional clients. Management fees from sponsored funds are calculated principally as a percentage of average daily net assets, are earned daily upon completion of investment advisory and administrative service performance obligations, and are typically paid monthly from the assets of the fund. Management fees from separate accounts are calculated as a percentage of either beginning, average or ending monthly or quarterly net assets, are earned daily, and are typically paid either monthly or quarterly from the assets of the separate account. Performance fees related to certain fund and separate account management contracts are generated when specific performance hurdles are met during the performance period. The Company may waive certain fees for asset management services provided to sponsored funds at its discretion. Separately, the Company may subsidize certain share classes of sponsored funds to ensure that operating expenses attributable to such share classes do not exceed a specified percentage. Fee waivers and fund subsidies are recognized as a reduction to management fee revenue. Distribution and underwriter fees The Company is entitled to receive distribution fees and underwriter commissions in exchange for distribution services provided to sponsored funds. Distribution services consist of distinct sales and marketing activities that are earned upon the sale of sponsored fund shares. Distribution fees for all share classes subject to these fees are calculated as a percentage of average daily net assets, and are typically paid monthly from the assets of the fund. Underwriting commissions for all share classes subject to these fees are calculated as a percentage of the amount invested and are deducted from the amount invested by the fund shareholder. These commissions represent fixed consideration and are recognized as revenue when the sponsored fund shares are sold to the shareholder. Underwriter commissions are waived or reduced on purchases of shares that exceed specified minimum amounts. Service fees The Company is entitled to receive service fees in exchange for shareholder services provided to sponsored funds. Shareholder services are comprised of a series of distinct incremental days of shareholder transaction processing and/or shareholder account maintenance services. Service fees are calculated as a percentage of average daily net assets under management, are earned daily upon completion of shareholder services, and are typically paid monthly from the assets of the fund. Principal versus agent The Company has contractual arrangements with third parties that are involved in providing various services primarily to sponsored fund customers, including sub-advisory, distribution and shareholder services. In instances where the Company has discretion to hire a third party to provide services to the Company’s clients, the Company is generally deemed to control the services before transferring them to the clients, and accordingly presents the revenues gross of the related third-party costs. Alternatively, the Company is acting as an agent (and therefore should record revenue net of payments to third-party service providers) when it does not control the service. The Company controls the right to asset management services performed by various third-party sub-advisers; therefore management fee revenue is recorded on a gross basis. Fees paid to sub-advisers are recognized as an expense when incurred and are included in fund-related expenses in the Company’s Consolidated Statements of Income. Separately, the Company also controls the right to distribution and shareholder services performed by various third-parties (including financial intermediaries); therefore distribution and underwriter fees and service fees are also recorded on a gross basis. Fees paid to third parties for distribution and shareholder services are recognized as an expense when incurred and are included in distribution expense and service fee expense, respectively, in the Company’s Consolidated Statements of Income. |
Comprehensive income | Comprehensive income The Company reports all changes in comprehensive income in its Consolidated Statements of Comprehensive Income. Comprehensive income includes net income, unrealized gains and losses on certain derivatives designated as cash flow hedges and related reclassification adjustments attributable to the amortization of net gains and losses on these derivatives and foreign currency translation adjustments, in each case net of tax. When the Company has established an indefinite reinvestment assertion for a foreign subsidiary, deferred income taxes are not provided on the related foreign currency translation. |
Leases | Leases In February 2016, the Financial Accounting Standards Board (FASB) issued new guidance for the accounting for leases, which requires a lessee to recognize on the balance sheet the assets and liabilities for the rights and obligations created by those leases with a lease term of more than 12 months. Leases will continue to be classified as either financing or operating, with classification affecting the recognition, measurement and presentation of expenses and cash flows arising from a lease. The new guidance is effective for the Company’s fiscal year that begins on November 1, 2019. The Company will apply a modified retrospective approach to adoption without restating comparative periods. The Company’s leases primarily include non-cancellable operating leases for office space and equipment. The Company will elect practical expedients that are intended to reduce the complexity of adoption and result in no requirement to reassess the following: whether an arrangement is or contains a lease, the classification of the lease, the recognition requirement for initial direct costs, and assumptions regarding renewal options that affect the lease term. The Company is evaluating the impact of the new guidance on the Consolidated Balance Sheet where the Company will be recording a right-of-use asset and lease liability for all of its operating leases. The lease liability will be initially measured at the present value of the future lease payments. The new guidance is not expected to have a significant impact on our results of operations or cash flows because the operating lease costs will continue to be recognized on a straight-line basis over the remaining lease term and lease payments will continue to be classified within operating activities in the Consolidated Statement of Cash Flows. The Company is in the process of finalizing its lease population and extracting relevant information from identified lease arrangements, evaluating the discount rate that will be used to measure lease liabilities at the date of initial application, implementing software to comply with the new guidance and developing and implementing appropriate changes to our internal processes and controls. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Jul. 31, 2019 | |
Summary of Significant Accounting Policies [Abstract] | |
Summary of retrospective adoption of ASU 2014-09 | Three Months Ended July 31, 2018 (in thousands) As Previously Reported Reclassification As Restated Revenue: Management fees $ 374,553 $ ( 5,592) $ 368,961 Distribution and underwriter fees 20,099 4,639 24,738 Service fees 31,260 ( 207) 31,053 Other revenue 4,690 ( 751) 3,939 Total revenue 430,602 ( 1,911) 428,691 Expenses: Compensation and related costs 152,921 - 152,921 Distribution expense 35,045 6,379 41,424 Service fee expense 28,760 ( 1,686) 27,074 Amortization of deferred sales commissions 4,637 - 4,637 Fund-related expenses 15,857 ( 6,604) 9,253 Other expenses 51,118 - 51,118 Total expenses 288,338 ( 1,911) 286,427 Operating income $ 142,264 $ - $ 142,264 Nine Months Ended July 31, 2018 (in thousands) As Previously Reported Reclassification As Restated Revenue: Management fees $ 1,101,929 $ ( 15,035) $ 1,086,894 Distribution and underwriter fees 60,393 13,449 73,842 Service fees 91,935 ( 1,068) 90,867 Other revenue 12,018 ( 1,994) 10,024 Total revenue 1,266,275 ( 4,648) 1,261,627 Expenses: Compensation and related costs 455,958 - 455,958 Distribution expense 105,219 18,672 123,891 Service fee expense 84,651 ( 5,057) 79,594 Amortization of deferred sales commissions 13,342 - 13,342 Fund-related expenses 46,036 ( 18,263) 27,773 Other expenses 150,319 - 150,319 Total expenses 855,525 ( 4,648) 850,877 Operating income $ 410,750 $ - $ 410,750 |
Cash, Cash Equivalents and Re_2
Cash, Cash Equivalents and Restricted Cash (Tables) | 9 Months Ended |
Jul. 31, 2019 | |
Cash, Cash Equivalents and Restricted Cash [Abstract] | |
Reconciliation of cash, cash equivalents and restricted cash | July 31, October 31, (in thousands) 2019 2018 Cash and cash equivalents $ 527,708 $ 600,696 Restricted cash of consolidated sponsored funds included in investments 72,461 33,525 Restricted cash included in assets of consolidated CLO entities, cash 87,755 216,598 Restricted cash included in other assets 22,686 15,256 Total cash, cash equivalents and restricted cash presented in the Consolidated Statement of Cash Flows $ 710,610 $ 866,075 |
Investments (Tables)
Investments (Tables) | 9 Months Ended |
Jul. 31, 2019 | |
Investments [Abstract] | |
Summary of investments | (in thousands) July 31,2019 October 31,2018 Investments held at fair value: Short-term debt securities $ 250,088 $ 273,320 Debt and equity securities held by consolidated sponsored funds 551,142 540,582 Debt and equity securities held in separately managed accounts 72,176 89,121 Non-consolidated sponsored funds and other 8,291 10,329 Total investments held at fair value 881,697 913,352 Investments held at cost 20,904 20,874 Investments in non-consolidated CLO entities 1,251 2,895 Investments in equity method investees 140,174 141,506 Total investments (1)(2) $ 1,044,026 $ 1,078,627 (1) Excludes bank loans and other investments held by consolidated CLO entities, which are discussed in Note 4. (2) Amounts at July 31, 2019 reflect the adoption of ASU 2016-01. Amounts at October 31, 2018 reflect accounting guidance prior to the adoption of ASU 2016-01. See Note 1 for further information. |
Summary of net gains (losses) on securities held at fair value | Three Months Ended Nine Months Ended July 31, July 31, (in thousands) 2019 2018 2019 2018 Realized gains (losses) on securities sold $ ( 298) $ 1,272 $ ( 531) $ 7,396 Unrealized gains (losses) on investments held at fair value 3,156 ( 3,433) 14,532 ( 10,407) Net gains (losses) on investments held at fair value (1) $ 2,858 $ ( 2,161) $ 14,001 $ ( 3,011) (1) Amounts for the three and nine months ended July 31, 2019 reflect the adoption of ASU 2016-01. The prior period gains and losses arising from changes in the fair value of investments reflect accounting guidance prior to the adoption of ASU 2016-01. See Note 1 for further information. |
Summary of equity method investees | (in millions) July 31,2019 October 31,2018 Equity in net assets of Hexavest $ 5.7 $ 6.0 Definite-lived intangible assets 20.0 21.3 Goodwill 116.4 116.4 Deferred tax liability ( 5.4) ( 5.7) Total carrying value $ 136.7 $ 138.0 |
Variable Interest Entities (Tab
Variable Interest Entities (Tables) | 9 Months Ended |
Jul. 31, 2019 | |
Variable Interest Entity [Line Items] | |
Schedule of the Balances Related to Consolidated Sponsored Funds | (in thousands) July 31,2019 October 31,2018 Investments $ 551,142 $ 540,582 Other assets 30,626 15,471 Other liabilities ( 38,847) ( 57,286) Redeemable non-controlling interests ( 258,207) ( 244,970) Net interest in consolidated sponsored funds $ 284,714 $ 253,797 |
Summary of the carrying amounts related to VIEs that are consolidated on the Company's Balance Sheet | July 31, October 31, (in thousands) 2019 2018 Assets of consolidated CLO entities: Cash $ 87,755 $ 216,598 Bank loans and other investments 1,706,350 874,304 Receivable for pending bank loan sales 18,514 2,535 Other assets 3,469 1,929 Liabilities of consolidated CLO entities: Senior and subordinated note obligations 1,620,598 873,008 Payable for pending bank loan purchases 66,301 152,152 Other liabilities 14,874 2,033 Total beneficial interests $ 114,315 $ 68,173 |
Summary of the Amounts Related to VIEs that are Consolidated on the Company's Income Statement | Consolidated Warehouse CLO Entities Three Months Ended Nine Months Ended July 31, July 31, (in thousands) 2019 2018 2019 2018 Other income (expense) of consolidated CLO entities: Gains (losses) and other investment income, net $ ( 1,994) $ 1,907 $ 3,308 $ 4,883 Interest and other expense ( 258) ( 999) ( 1,490) ( 1,537) Net gain (loss) attributable to the Company $ ( 2,252) $ 908 $ 1,818 $ 3,346 Consolidated Securitized CLO Entities Three Months Ended Nine Months Ended July 31, July 31, (in thousands) 2019 2018 2019 2018 Other income (expense) of consolidated CLO entities: Gains (losses) and other investment income, net $ 20,254 $ ( 60) $ 42,187 $ ( 60) Interest and other expense ( 21,490) ( 2,093) ( 39,415) ( 2,093) Net gain (loss) attributable to the Company $ ( 1,236) $ ( 2,153) $ 2,772 $ ( 2,153) |
Summary of Application of the Measurement Alternative Results in the Companys Earnings from Consolidated VIEs Subsequent to Initial Consolidation | Three Months Ended Nine Months Ended July 31, July 31, (in thousands) 2019 2018 2019 2018 Economic interests in Consolidated Securitized CLO Entities: Distributions received and unrealized gains (losses) on the senior and subordinated interests held by the Company $ ( 2,943) $ ( 2,390) $ ( 1,072) $ ( 2,390) Management fees 1,707 237 3,844 237 Total economic interests $ ( 1,236) $ ( 2,153) $ 2,772 $ ( 2,153) |
Derivative Financial Instrume_2
Derivative Financial Instruments (Tables) | 9 Months Ended |
Jul. 31, 2019 | |
Derivative Financial Instruments [Abstract] | |
Summary of notional, fair value and net gains (losses) of other derivative instruments not designated for hedge accounting | July 31, 2019 October 31, 2018 Number of Contracts Notional Value ( in millions ) Number of Contracts Notional Value ( in millions ) Stock index futures contracts 1,104 $ 144.7 1,007 $ 91.5 Total return swap contracts 4 $ 124.9 3 $ 106.5 Credit default swap contracts 1 $ 8.0 1 $ 5.0 Foreign exchange contracts 44 $ 95.5 28 $ 23.0 Commodity futures contracts 292 $ 12.1 253 $ 11.6 Currency futures contracts 191 $ 20.2 165 $ 16.9 Interest rate futures contracts 177 $ 28.9 282 $ 48.0 July 31, 2019 October 31, 2018 (in thousands) Other Assets Other Liabilities Other Assets Other Liabilities Stock index futures contracts $ 399 $ 1,805 $ 5,055 $ 372 Total return swap contracts 50 10,705 - 3,297 Credit default swap contracts 220 - - 10 Foreign exchange contracts 403 1,262 329 202 Commodity futures contracts 94 418 770 216 Currency futures contracts 210 196 14 332 Interest rate futures contracts 61 799 179 17 Total $ 1,437 $ 15,185 $ 6,347 $ 4,446 Three Months Ended Nine Months Ended July 31, July 31, (in thousands) 2019 2018 2019 2018 Stock index futures contracts $ 856 $ ( 1,448) $ ( 5,041) $ ( 3,385) Total return swap contracts ( 596) ( 1,526) ( 5,547) ( 2,535) Credit default swap contracts ( 135) 150 ( 280) 150 Foreign exchange contracts ( 1,609) 302 ( 1,548) ( 326) Commodity futures contracts 110 ( 346) ( 913) ( 1,066) Currency futures contracts 633 70 1,923 72 Interest rate futures contracts ( 1,007) 174 ( 1,909) 156 Net losses $ ( 1,748) $ ( 2,624) $ ( 13,315) $ ( 6,934) |
Fair Value of Assets and Liab_2
Fair Value of Assets and Liabilities Measured at Fair Value on a Recurring Basis (Tables) | 9 Months Ended |
Jul. 31, 2019 | |
Fair Value of Assets and Liabilities Measured at Fair Value on a Recurring Basis [Abstract] | |
Summary of financial assets and liabilites measured at fair value on a recurring basis and their assigned levels within the valuation hierarchy | July 31, 2019 (1) (in thousands) Level 1 Level 2 Level 3 Other Assets Not Held at Fair Value Total Financial assets: Cash equivalents $ 17,267 $ 92,817 $ - $ - $ 110,084 Investments held at fair value: Debt securities: Short-term - 250,088 - - 250,088 Held by consolidated sponsored funds - 336,440 - - 336,440 Held in separately managed accounts - 52,017 - - 52,017 Equity securities: Held by consolidated sponsored funds 68,824 145,878 - - 214,702 Held in separately managed accounts 20,068 91 - - 20,159 Non-consolidated sponsored funds and other 7,783 508 - - 8,291 Investments held at cost (2) - - - 20,904 20,904 Investments in non-consolidated CLO entities (3) - - - 1,251 1,251 Investments in equity method investees (2) - - - 140,174 140,174 Derivative instruments - 1,437 - - 1,437 Assets of consolidated CLO entities: Bank loans and other investments - 1,703,576 2,774 - 1,706,350 Total financial assets $ 113,942 $ 2,582,852 $ 2,774 $ 162,329 $ 2,861,897 Financial liabilities: Derivative instruments $ - $ 15,185 $ - $ - $ 15,185 Liabilities of consolidated CLO entities: Senior and subordinated note obligations - 1,620,598 - - 1,620,598 Total financial liabilities $ - $ 1,635,783 $ - $ - $ 1,635,783 October 31, 2018 (1) (in thousands) Level 1 Level 2 Level 3 Other Assets Not Held at Fair Value Total Financial assets: Cash equivalents $ 23,262 $ 116,070 $ - $ - $ 139,332 Investments held at fair value: Debt securities: Short-term - 273,320 - - 273,320 Held by consolidated sponsored funds 12,834 392,139 - - 404,973 Held in separately managed accounts 521 64,539 - - 65,060 Equity securities: Held by consolidated sponsored funds 73,291 62,318 - - 135,609 Held in separately managed accounts 23,642 419 - - 24,061 Non-consolidated sponsored funds and other 7,112 3,217 - - 10,329 Investments held at cost (2) - - - 20,874 20,874 Investments in non-consolidated CLO entities (3) - - - 2,895 2,895 Investments in equity method investees (2) - - - 141,506 141,506 Derivative instruments - 6,347 - - 6,347 Assets of consolidated CLO entities: Bank loans and other investments - 872,757 1,547 - 874,304 Total financial assets $ 140,662 $ 1,791,126 $ 1,547 $ 165,275 $ 2,098,610 Financial liabilities: Derivative instruments $ - $ 4,446 $ - $ - $ 4,446 Liabilities of consolidated CLO entities: Senior and subordinated note obligations - 873,008 - - 873,008 Total financial liabilities $ - $ 877,454 $ - $ - $ 877,454 (1) Amounts at July 31, 2019 reflect the adoption of ASU 2016-01. Amounts at October 31, 2018 reflect accounting guidance prior to the adoption of ASU 2016-01. See Note 1 for further information. (2) These investments are not measured at fair value in accordance with U.S. GAAP. (3) Investments in non-consolidated CLO entities are carried at amortized cost unless facts or circumstances indicate that the investments have been impaired, at which time the investments are written down to fair value as measured using level 3 inputs. |
Summary of the changes in Level 3 assets and liabilities measured at fair value on a recurring basis | Bank Loans and Other Investments of Consolidated CLO Entities Three Months Ended Nine Months Ended (in thousands) July 31, 2019 July 31, 2019 Beginning balance $ 1,138 $ 1,547 Paydowns ( 7) ( 19) Net gains (losses) included in net income 320 ( 77) Consolidation of CLO entities (1) 1,323 1,323 Ending balance $ 2,774 $ 2,774 (1) Represents Level 3 bank loans and other investments held by consolidated CLO entities upon the initial consolidation of these entities during the period. Bank Loans and Other Investments of Consolidated CLO Entities Three and Nine Months Ended (in thousands) July 31, 2018 Beginning balance $ - Consolidation of CLO entities (1) 2,388 Ending balance $ 2,388 (1) Represents Level 3 bank loans and other investments held by consolidated CLO entities upon the initial consolidation of these entities during the period. |
Summary of financial assets and liabilities not measured at fair value | July 31, 2019 October 31, 2018 (in thousands) Carrying Value Fair Value Fair Value Level Carrying Value Fair Value Fair Value Level Loan to affiliate $ 5,000 $ 5,000 3 $ 5,000 $ 5,000 3 Debt $ 620,304 $ 648,509 2 $ 619,678 $ 607,391 2 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 9 Months Ended |
Jul. 31, 2019 | |
Intangible Assets [Abstract] | |
Schedule of the carrying amounts of intangible assets | July 31, 2019 (in thousands) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Amortizing intangible assets: Client relationships acquired $ 134,247 $ ( 115,034) $ 19,213 Intellectual property acquired 1,025 ( 569) 456 Trademark acquired 4,257 ( 1,466) 2,791 Research system acquired 639 ( 550) 89 Non-amortizing intangible assets: Mutual fund management contracts acquired 54,408 - 54,408 Total $ 194,576 $ ( 117,619) $ 76,957 October 31, 2018 (in thousands) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Amortizing intangible assets: Client relationships acquired $ 134,247 $ ( 111,591) $ 22,656 Intellectual property acquired 1,025 ( 519) 506 Trademark acquired 4,257 ( 1,190) 3,067 Research system acquired 639 ( 391) 248 Non-amortizing intangible assets: Mutual fund management contracts acquired 54,408 - 54,408 Total $ 194,576 $ ( 113,691) $ 80,885 |
Schedule of estimated amortization expense for the remainder of the fiscal year and the next five fiscal years | Estimated Year Ending October 31, Amortization (in thousands) Expense Remaining 2019 $ 1,050 2020 3,807 2021 2,282 2022 2,154 2023 1,754 2024 1,679 |
Revenue (Table)
Revenue (Table) | 9 Months Ended |
Jul. 31, 2019 | |
Revenue [ Abstract] | |
Schedule of revenue earned | Three Months Ended Nine Months Ended July 31, July 31, (in thousands) 2019 2018 2019 2018 Management fees: Sponsored funds $ 256,620 $ 257,554 $ 742,750 $ 757,217 Separate accounts 119,127 111,407 343,131 329,677 Total management fees 375,747 368,961 1,085,881 1,086,894 Distribution and underwriter fees: Distribution fees 15,317 19,360 49,168 58,113 Underwriter commissions 5,964 5,378 15,257 15,729 Total distribution and underwriter fees 21,281 24,738 64,425 73,842 Service fees 31,855 31,053 90,801 90,867 Other revenue 2,352 3,939 8,405 10,024 Total revenue $ 431,235 $ 428,691 $ 1,249,512 $ 1,261,627 |
Summary of management fee revenue by investment mandate | Three Months Ended Nine Months Ended July 31, July 31, (in thousands) 2019 2018 2019 2018 Equity $ 180,081 $ 176,205 $ 516,290 $ 522,240 Fixed income 73,514 65,209 209,344 193,419 Floating-rate income 48,906 53,944 151,989 155,640 Alternative 15,371 22,470 45,672 65,582 Portfolio implementation 47,046 40,165 131,082 116,957 Exposure management 10,829 10,968 31,504 33,056 Total management fees $ 375,747 $ 368,961 $ 1,085,881 $ 1,086,894 |
Stock-Based Compensation Plans
Stock-Based Compensation Plans (Tables) | 9 Months Ended |
Jul. 31, 2019 | |
Stock-Based Compensation Plans [Abstract] | |
Summary of stock-based compensation expense recognized by plan | Three Months Ended Nine Months Ended July 31, July 31, (in thousands) 2019 2018 2019 2018 Omnibus Incentive Plans: Stock options $ 6,212 $ 5,931 $ 16,774 $ 18,337 Restricted shares 14,827 13,897 43,327 39,974 Deferred stock units (1) 121 49 860 978 Employee Stock Purchase Plans 179 312 355 793 Employee Stock Purchase Incentive Plan 90 129 467 818 Atlanta Capital Plan 569 743 1,709 2,227 Atlanta Capital Phantom Incentive Plan 274 143 813 424 Parametric Plan 368 794 1,708 2,383 Parametric Phantom Incentive Plan 901 842 2,814 2,343 Total stock-based compensation expense $ 23,541 $ 22,840 $ 68,827 $ 68,277 (1) In the fourth quarter of fiscal 2018, the Company changed the description of phantom stock units to deferred stock units. The change in the description had no impact on, nor does it constitute a restatement of, the Company's previously reported amounts attributable to these awards. |
Summary of stock option transactions | (share and intrinsic value amounts in thousands) Shares Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (in years) Aggregate Intrinsic Value Options outstanding, beginning of period 16,760 $ 35.23 Granted 2,469 45.37 Exercised ( 803) 29.14 Forfeited/expired ( 60) 40.44 Options outstanding, end of period 18,366 $ 36.84 5.7 $ 153,855 Options exercisable, end of period 9,692 $ 32.98 3.9 $ 112,735 |
Summary of restricted share activity | Weighted- Average Grant Date (share figures in thousands) Shares Fair Value Unvested, beginning of period 4,544 $ 40.70 Granted 1,746 44.87 Vested ( 1,315) 39.23 Forfeited ( 100) 42.95 Unvested, end of period 4,875 $ 42.55 |
Non-operating Income (Expense)
Non-operating Income (Expense) (Tables) | 9 Months Ended |
Jul. 31, 2019 | |
Non-operating Income (Expense) [Abstract] | |
Summary of non-operating income (expense) | Three Months Ended Nine Months Ended July 31, July 31, (in thousands) 2019 2018 2019 2018 Interest and other income $ 11,507 $ 10,247 $ 32,861 $ 26,616 Net gains (losses) on investments and derivatives (1) 3,440 ( 3,120) 3,509 ( 16,453) Net foreign currency gains (losses) ( 101) 4 ( 485) ( 695) Gains and other investment income, net 14,846 7,131 35,885 9,468 Interest expense ( 5,888) ( 5,906) ( 17,907) ( 17,716) Other income (expense) of consolidated CLO entities: Interest income 22,268 4,505 49,077 6,193 Net losses on bank loans and other investments and note obligations ( 4,008) ( 2,658) ( 3,582) ( 1,370) Gains and other investment income, net 18,260 1,847 45,495 4,823 Structuring and closing fees ( 5,429) - ( 5,548) - Interest expense ( 16,319) ( 3,092) ( 35,357) ( 3,630) Interest and other expense ( 21,748) ( 3,092) ( 40,905) ( 3,630) Total non-operating income (expense) $ 5,470 $ ( 20) $ 22,568 $ ( 7,055) (1) The nine months ended July 31, 2018 includes the $ 6.5 million loss associated with the Company's determination not to exercise the option to acquire an additional 26 percent ownership in Hexavest. |
Income Taxes (Tables)
Income Taxes (Tables) | 9 Months Ended |
Jul. 31, 2019 | |
Income Tax [Abstract] | |
Reconciliation of the difference between the Company's effective tax rate and the U.S. federal statutory tax rate | Three Months Ended Nine Months Ended July 31, July 31, 2019 2018 2019 2018 Statutory U.S. federal income tax rate (1) 21.0 % 23.3 % 21.0 % 23.3 % State income tax, net of federal income tax benefits 5.0 % 4.4 % 4.6 % 4.3 % Net income attributable to non-controlling and other beneficial interests - 1.3 % - 1.0 % - 1.0 % - 0.9 % Non-recurring impact of U.S. tax reform - % - % - % 6.1 % Net excess tax benefits from stock-based compensation plans (2) - 0.4 % - 0.9 % - 0.9 % - 3.7 % Other items 1.2 % 0.4 % 1.1 % 0.6 % Effective income tax rate 25.5 % 26.2 % 24.8 % 29.7 % (1) The Company's statutory U.S. federal income tax rate for fiscal 2019 is 21 percent based on the Tax Cuts and Jobs Act (2017 Tax Act). The Company's statutory U.S. federal income tax rate for fiscal 2018 was a blend of 35 percent and 21 percent based on the number of days in the Company's fiscal year before and after the January 1, 2018 effective date of the reduction in the federal corporate income tax rate pursuant to the 2017 Tax Act. (2) Reflects the impact of the adoption of ASU 2016-09, Improvements to Employee Share-Based Payment Accounting, which was adopted by the Company in the first quarter of fiscal 2018. |
Non-controlling and Other Ben_2
Non-controlling and Other Beneficial Interests (Tables) | 9 Months Ended |
Jul. 31, 2019 | |
Non Controlling and Other Beneficial Interests [Abstract] | |
Summary of net (income) loss attributable to non-controlling and other beneficial interests | Three Months Ended Nine Months Ended July 31, July 31, (in thousands) 2019 2018 2019 2018 Consolidated sponsored funds $ ( 2,760) $ ( 1,862) $ ( 13,323) $ ( 4,215) Majority-owned subsidiaries ( 3,555) ( 4,119) ( 9,774) ( 12,026) Net income attributable to non-controlling and other beneficial interests $ ( 6,315) $ ( 5,981) $ ( 23,097) $ ( 16,241) |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (Loss) (Tables) | 9 Months Ended |
Jul. 31, 2019 | |
Comprehensive Income (Loss) Disclosure Table [Abstract] | |
Components of accumulated other comprehensive income (loss) | (in thousands) Unamortized Net Gains on Cash Flow Hedges (1) Net Unrealized Gains on Available-for-Sale Investments (2) Foreign Currency Translation Adjustments Total Balance at April 30, 2019 $ 150 $ - $ ( 61,765) $ ( 61,615) Other comprehensive income, before reclassifications and tax - - 1,703 1,703 Tax impact - - - - Reclassification adjustments, before tax ( 33) - - ( 33) Tax impact 10 - - 10 Net current period other comprehensive income (loss) ( 23) - 1,703 1,680 Balance at July 31, 2019 $ 127 $ - $ ( 60,062) $ ( 59,935) Balance at April 30, 2018 $ 251 $ 5,160 $ ( 49,884) $ ( 44,473) Other comprehensive income (loss), before reclassifications and tax - 514 ( 4,585) ( 4,071) Tax impact - ( 114) - ( 114) Reclassification adjustments, before tax ( 33) ( 1,861) - ( 1,894) Tax impact 8 434 - 442 Net current period other comprehensive loss ( 25) ( 1,027) ( 4,585) ( 5,637) Balance at July 31, 2018 $ 226 $ 4,133 $ ( 54,469) $ ( 50,110) (in thousands) Unamortized Net Gains on Cash Flow Hedges (1) Net Unrealized Gains on Available-for-Sale Investments Foreign Currency Translation Adjustments Total Balance at October 31, 2018 $ 200 $ 3,714 $ ( 57,095) $ ( 53,181) Cumulative effect adjustment upon adoption of new accounting standard (ASU 2016-01) (2) - ( 3,714) - ( 3,714) Balance at November 1, 2018, as adjusted 200 - ( 57,095) ( 56,895) Other comprehensive loss, before reclassifications and tax - - ( 2,967) ( 2,967) Tax impact - - - - Reclassification adjustments, before tax ( 100) - - ( 100) Tax impact 27 - - 27 Net current period other comprehensive loss ( 73) - ( 2,967) ( 3,040) Balance at July 31, 2019 $ 127 $ - $ ( 60,062) $ ( 59,935) Balance at October 31, 2017 $ 301 $ 4,128 $ ( 51,903) $ ( 47,474) Other comprehensive income (loss), before reclassifications and tax - 1,890 ( 2,566) ( 676) Tax impact - ( 458) - ( 458) Reclassification adjustments, before tax ( 99) ( 1,861) - ( 1,960) Tax impact 24 434 - 458 Net current period other comprehensive income (loss) ( 75) 5 ( 2,566) ( 2,636) Balance at July 31, 2018 $ 226 $ 4,133 $ ( 54,469) $ ( 50,110) (1) Amounts reclassified from accumulated other comprehensive income (loss), net of tax, represent the amortization of net gains (losses) on qualifying derivative financial instruments designated as cash flow hedges over the life of the Company's senior notes into interest expense on the Consolidated Statements of Income. (2) Upon adoption of ASU 2016-01 on November 1, 2018, unrealized holding gains, net of related income tax effects, attributable to investments in non-consolidated sponsored funds and other investments previously classified as available-for-sale investments were reclassified from accumulated other comprehensive income (loss) to retained earnings. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Jul. 31, 2019 | |
Earnings per Share [Abstract] | |
Summary schedule of the calculation of earnings per basic and diluted shares | Three Months Ended Nine Months Ended July 31, July 31, (in thousands, except per share data) 2019 2018 2019 2018 Net income attributable to Eaton Vance Corp. shareholders $ 102,221 $ 101,794 $ 290,829 $ 276,451 Weighted-average shares outstanding – basic 109,111 114,610 110,553 115,157 Incremental common shares 4,353 8,131 3,957 8,396 Weighted-average shares outstanding – diluted 113,464 122,741 114,510 123,553 Earnings per share: Basic $ 0.94 $ 0.89 $ 2.63 $ 2.40 Diluted $ 0.90 $ 0.83 $ 2.54 $ 2.24 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 9 Months Ended |
Jul. 31, 2019 | |
Related Party Transactions [Abstract] | |
Summary of related party revenue transactions | Three Months Ended Nine Months Ended July 31, July 31, (in thousands) 2019 2018 (1) 2019 2018 (1) Management fees $ 256,620 $ 257,554 $ 742,750 $ 757,217 Distribution and underwriter fees 21,281 24,738 64,425 73,842 Service fees 31,855 31,053 90,801 90,867 Shareholder services fees included in other revenue 1,622 1,672 4,900 4,540 Total $ 311,378 $ 315,017 $ 902,876 $ 926,466 (1) Prior period amounts have been adjusted as a result of the retrospective adoption of ASU 2014-09. See Note 1, Summary of Significant Accounting Policies, for further information on the impact of the adoption of ASU 2014-09. |
Summary of sales proceeds and net realized gains (losses) from investments in non-consolidated sponsored funds | Three Months Ended Nine Months Ended July 31, July 31, (in thousands) 2019 2018 2019 2018 Proceeds from sales $ 1,206 $ 2,936 $ 7,831 $ 7,812 Net realized gains 286 2,066 5,490 1,961 |
Geographic Information (Tables)
Geographic Information (Tables) | 9 Months Ended |
Jul. 31, 2019 | |
Geographical Information [Abstract] | |
Summary of revenue and long-lived assets by principal georgraphic areas | Three Months Ended Nine Months Ended July 31, July 31, (in thousands) 2019 2018 2019 2018 Revenue: U.S. (1) $ 415,746 $ 411,241 $ 1,202,869 $ 1,210,837 International (1) 15,489 17,450 46,643 50,790 Total $ 431,235 $ 428,691 $ 1,249,512 $ 1,261,627 (1) Prior period amounts have been adjusted as a result of the retrospective adoption of ASU 2014-09. See Note 1, Summary of Significant Accounting Policies, for further information on the impact of the adoption of ASU 2014-09. July 31, October 31, (in thousands) 2019 2018 Long-lived Assets: U.S. $ 68,909 $ 50,459 International 1,625 1,969 Total $ 70,534 $ 52,428 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | Oct. 31, 2018 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Revenue | $ 431,235 | $ 428,691 | $ 1,249,512 | $ 1,261,627 | |
Fund Related Expense | $ 9,715 | 9,253 | $ 29,320 | 27,773 | |
Consolidated Sponsored Funds And Consolidated CLO Entities [Member] | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Change in restricted cash | 35,900 | ||||
Maximum [Member] | Non-controlled Affiliates [Member] | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 50.00% | 50.00% | |||
Minimum [Member] | Non-controlled Affiliates [Member] | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 20.00% | 20.00% | |||
Total Distribution And Underwriter Fees [Member] | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Revenue | $ 21,281 | 24,738 | $ 64,425 | 73,842 | |
Accounting Standards Update 2014-09 [Member] | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Cumulative effect adjustment upon adoption of new accounting standard | $ 3,700 | $ 3,700 | |||
Revenue | 428,691 | 1,261,627 | |||
Fund Related Expense | 9,253 | 27,773 | |||
Accounting Standards Update 2014-09 [Member] | Total Distribution And Underwriter Fees [Member] | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Revenue | 24,738 | 73,842 | |||
Accounting Standards Update 2014-09 [Member] | Restatement Adjustment [Member] | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Revenue | (1,911) | (4,648) | |||
Fund Related Expense | (6,604) | (18,263) | |||
Accounting Standards Update 2014-09 [Member] | Restatement Adjustment [Member] | Total Distribution And Underwriter Fees [Member] | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Revenue | $ 4,639 | $ 13,449 | |||
Accounting Standards Update 2016-01 [Member] | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Equity securities | $ 10,300 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Summary of retrospective adoption of ASU 2014-09) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | |
Adoption of New Accounting Pronouncement [Line Items] | ||||
Total revenue | $ 431,235 | $ 428,691 | $ 1,249,512 | $ 1,261,627 |
Compensation and related costs | 158,642 | 152,921 | 466,072 | 455,958 |
Distribution expense | 38,070 | 41,424 | 111,508 | 123,891 |
Service fee expense | 28,037 | 27,074 | 79,475 | 79,594 |
Amortization of deferred sales commissions | 5,644 | 4,637 | 16,762 | 13,342 |
Fund-related expenses | 9,715 | 9,253 | 29,320 | 27,773 |
Other expenses | 53,992 | 51,118 | 160,937 | 150,319 |
Total expenses | 294,100 | 286,427 | 864,074 | 850,877 |
Operating income | 137,135 | 142,264 | 385,438 | 410,750 |
Accounting Standards Update 2014-09 [Member] | ||||
Adoption of New Accounting Pronouncement [Line Items] | ||||
Total revenue | 428,691 | 1,261,627 | ||
Compensation and related costs | 152,921 | 455,958 | ||
Distribution expense | 41,424 | 123,891 | ||
Service fee expense | 27,074 | 79,594 | ||
Amortization of deferred sales commissions | 4,637 | 13,342 | ||
Fund-related expenses | 9,253 | 27,773 | ||
Other expenses | 51,118 | 150,319 | ||
Total expenses | 286,427 | 850,877 | ||
Operating income | 142,264 | 410,750 | ||
Total Management Fees [Member] | ||||
Adoption of New Accounting Pronouncement [Line Items] | ||||
Total revenue | 375,747 | 368,961 | 1,085,881 | 1,086,894 |
Total Management Fees [Member] | Accounting Standards Update 2014-09 [Member] | ||||
Adoption of New Accounting Pronouncement [Line Items] | ||||
Total revenue | 368,961 | 1,086,894 | ||
Total Distribution And Underwriter Fees [Member] | ||||
Adoption of New Accounting Pronouncement [Line Items] | ||||
Total revenue | 21,281 | 24,738 | 64,425 | 73,842 |
Total Distribution And Underwriter Fees [Member] | Accounting Standards Update 2014-09 [Member] | ||||
Adoption of New Accounting Pronouncement [Line Items] | ||||
Total revenue | 24,738 | 73,842 | ||
Service Fees [Member] | ||||
Adoption of New Accounting Pronouncement [Line Items] | ||||
Total revenue | 31,855 | 31,053 | 90,801 | 90,867 |
Service Fees [Member] | Accounting Standards Update 2014-09 [Member] | ||||
Adoption of New Accounting Pronouncement [Line Items] | ||||
Total revenue | 31,053 | 90,867 | ||
Other Revenue [Member] | ||||
Adoption of New Accounting Pronouncement [Line Items] | ||||
Total revenue | $ 2,352 | 3,939 | $ 8,405 | 10,024 |
Other Revenue [Member] | Accounting Standards Update 2014-09 [Member] | ||||
Adoption of New Accounting Pronouncement [Line Items] | ||||
Total revenue | 3,939 | 10,024 | ||
As Previously Reported [Member] | Accounting Standards Update 2014-09 [Member] | ||||
Adoption of New Accounting Pronouncement [Line Items] | ||||
Total revenue | 430,602 | 1,266,275 | ||
Compensation and related costs | 152,921 | 455,958 | ||
Distribution expense | 35,045 | 105,219 | ||
Service fee expense | 28,760 | 84,651 | ||
Amortization of deferred sales commissions | 4,637 | 13,342 | ||
Fund-related expenses | 15,857 | 46,036 | ||
Other expenses | 51,118 | 150,319 | ||
Total expenses | 288,338 | 855,525 | ||
Operating income | 142,264 | 410,750 | ||
As Previously Reported [Member] | Total Management Fees [Member] | Accounting Standards Update 2014-09 [Member] | ||||
Adoption of New Accounting Pronouncement [Line Items] | ||||
Total revenue | 374,553 | 1,101,929 | ||
As Previously Reported [Member] | Total Distribution And Underwriter Fees [Member] | Accounting Standards Update 2014-09 [Member] | ||||
Adoption of New Accounting Pronouncement [Line Items] | ||||
Total revenue | 20,099 | 60,393 | ||
As Previously Reported [Member] | Service Fees [Member] | Accounting Standards Update 2014-09 [Member] | ||||
Adoption of New Accounting Pronouncement [Line Items] | ||||
Total revenue | 31,260 | 91,935 | ||
As Previously Reported [Member] | Other Revenue [Member] | Accounting Standards Update 2014-09 [Member] | ||||
Adoption of New Accounting Pronouncement [Line Items] | ||||
Total revenue | 4,690 | 12,018 | ||
Reclassification [Member] | Accounting Standards Update 2014-09 [Member] | ||||
Adoption of New Accounting Pronouncement [Line Items] | ||||
Total revenue | (1,911) | (4,648) | ||
Distribution expense | 6,379 | 18,672 | ||
Service fee expense | (1,686) | (5,057) | ||
Fund-related expenses | (6,604) | (18,263) | ||
Total expenses | (1,911) | (4,648) | ||
Reclassification [Member] | Total Management Fees [Member] | Accounting Standards Update 2014-09 [Member] | ||||
Adoption of New Accounting Pronouncement [Line Items] | ||||
Total revenue | (5,592) | (15,035) | ||
Reclassification [Member] | Total Distribution And Underwriter Fees [Member] | Accounting Standards Update 2014-09 [Member] | ||||
Adoption of New Accounting Pronouncement [Line Items] | ||||
Total revenue | 4,639 | 13,449 | ||
Reclassification [Member] | Service Fees [Member] | Accounting Standards Update 2014-09 [Member] | ||||
Adoption of New Accounting Pronouncement [Line Items] | ||||
Total revenue | (207) | (1,068) | ||
Reclassification [Member] | Other Revenue [Member] | Accounting Standards Update 2014-09 [Member] | ||||
Adoption of New Accounting Pronouncement [Line Items] | ||||
Total revenue | $ (751) | $ (1,994) |
Cash, Cash Equivalents and Re_3
Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands | Jul. 31, 2019 | Oct. 31, 2018 | Jul. 31, 2018 | Oct. 31, 2017 |
Restricted Cash And Cash Equivalents Items [Line Items] | ||||
Cash and cash equivalents | $ 527,708 | $ 600,696 | ||
Total cash, cash equivalents, and restricted cash presented in the Consolidated Statement of Cash Flows | 710,610 | 866,075 | $ 689,374 | $ 649,863 |
Consolidated Sponsored Funds Included In Investments [Member] | ||||
Restricted Cash And Cash Equivalents Items [Line Items] | ||||
Restricted Cash | 72,461 | 33,525 | ||
Assets Of Consolidated CLO Entities Cash [Member] | ||||
Restricted Cash And Cash Equivalents Items [Line Items] | ||||
Restricted Cash | 87,755 | 216,598 | ||
Restricted Cash Included In Other Assets [Member] | ||||
Restricted Cash And Cash Equivalents Items [Line Items] | ||||
Restricted Cash | $ 22,686 | $ 15,256 |
Investments (Summary of Investm
Investments (Summary of Investments) (Details) - USD ($) $ in Thousands | Jul. 31, 2019 | Oct. 31, 2018 |
Marketable Securities [Line Items] | ||
Non-consolidated sponsored funds and other | $ 8,291 | $ 10,329 |
Total investments held at fair value | 881,697 | 913,352 |
Investments held at cost | 20,904 | 20,874 |
Investments in non-consolidated CLO entities | 1,251 | 2,895 |
Investments in equity method investees | 140,174 | 141,506 |
Total investments | 1,044,026 | 1,078,627 |
Short-term Debt Securities [Member] | ||
Marketable Securities [Line Items] | ||
Investments | 250,088 | 273,320 |
Consolidated Sponsored Funds [Member] | ||
Marketable Securities [Line Items] | ||
Investments | 551,142 | 540,582 |
Separately Managed Accounts [Member] | ||
Marketable Securities [Line Items] | ||
Investments | $ 72,176 | $ 89,121 |
Investments (Summary of net gai
Investments (Summary of net gains (losses) investments held at fair value) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | |
Investments [Abstract] | ||||
Realized gains (losses) on securities sold | $ (298) | $ 1,272 | $ (531) | $ 7,396 |
Unrealized gains (losses) on investments held at fair value | 3,156 | (3,433) | 14,532 | (10,407) |
Net gains (losses) on investments held at fair value | $ 2,858 | $ (2,161) | $ 14,001 | $ (3,011) |
Investments (Investments in non
Investments (Investments in non-consolidated CLO entities Narrative) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | Oct. 31, 2018 | |
Investments [Abstract] | |||||
Non-Consolidated Variable Interest Entity Assets Under Management | $ 400,000,000 | $ 400,000,000 | $ 800,000,000 | ||
Impairment losses on investment | $ 0 | $ 200,000 | $ 0 | $ 200,000 |
Investments (Equity Method Inve
Investments (Equity Method Investees Narrative) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | Oct. 31, 2018 | |
Schedule Of Equity Method Investments [Line Items] | |||||
Equity method investment carrying value | $ 140,174,000 | $ 140,174,000 | $ 141,506,000 | ||
Impairment loss on investment | $ 0 | $ 0 | 0 | $ 0 | |
Dividends received from affiliates | $ 8,221,000 | $ 9,164,000 | |||
Hexavest [Member] | |||||
Schedule Of Equity Method Investments [Line Items] | |||||
Equity method investment ownership percentage | 49.00% | 49.00% | 49.00% | ||
Equity method investment carrying value | $ 136,700,000 | $ 136,700,000 | $ 138,000,000 | ||
Private Equity Partnership [Member] | |||||
Schedule Of Equity Method Investments [Line Items] | |||||
Equity method investment ownership percentage | 7.00% | 7.00% | 7.00% | ||
Equity method investment carrying value | $ 3,500,000 | $ 3,500,000 | $ 3,500,000 |
Investments (Summary of Equity
Investments (Summary of Equity Method Investment) (Details) - USD ($) $ in Thousands | Jul. 31, 2019 | Oct. 31, 2018 |
Schedule Of Equity Method Investments [Line Items] | ||
Total carrying value | $ 140,174 | $ 141,506 |
Hexavest [Member] | ||
Schedule Of Equity Method Investments [Line Items] | ||
Equity in net assets of Hexavest | 5,700 | 6,000 |
Definite-lived intangible assets | 20,000 | 21,300 |
Goodwill | 116,400 | 116,400 |
Deferred tax liability | (5,400) | (5,700) |
Total carrying value | $ 136,700 | $ 138,000 |
Variable Interest Entities (Inv
Variable Interest Entities (Investments in VIEs That Are Consolidated - Narrative) (Details) | May 15, 2019USD ($) | May 01, 2019USD ($) | Jan. 14, 2019USD ($) | Jul. 31, 2019USD ($)NrEntities | Jan. 31, 2019USD ($) | Oct. 31, 2018USD ($)NrEntities | Jul. 31, 2018USD ($) | Apr. 30, 2019USD ($) | Jul. 31, 2019USD ($)NrEntities | Jul. 31, 2018USD ($) | Oct. 31, 2018USD ($)NrEntities | Jan. 03, 2019USD ($) |
Variable Interest Entity [Line Items] | ||||||||||||
Number Of Nonrecourse CLO Entities | NrEntities | 3 | 3 | ||||||||||
Debt Instrument Maturity Date | Oct. 31, 2022 | |||||||||||
Net income attributable to Eaton Vance Corp. shareholders | $ 102,221,000 | $ 101,794,000 | $ 290,829,000 | $ 276,451,000 | ||||||||
Promissory Note [Member] | ||||||||||||
Variable Interest Entity [Line Items] | ||||||||||||
Contribution to a CLO entity | $ 10,000 | $ 10,000 | ||||||||||
Total contribution to a CLO | $ 20,000 | 10,000 | $ 20,000 | |||||||||
Variable Interest Entity, Primary Beneficiary [Member] | ||||||||||||
Variable Interest Entity [Line Items] | ||||||||||||
Number Of Nonrecourse CLO Entities | NrEntities | 4 | 4 | ||||||||||
Eaton Vance CLO 2014-1 [Member] | ||||||||||||
Variable Interest Entity [Line Items] | ||||||||||||
Distribution from CLO entity | $ 1,900,000 | |||||||||||
Eaton Vance CLO 2013-1 [Member] | ||||||||||||
Variable Interest Entity [Line Items] | ||||||||||||
Payment to acquire subordinated notes | $ 25,400,000 | |||||||||||
Company's subordinated interest in non-consolidated CLO entities | 100.00% | 100.00% | 100.00% | |||||||||
Total investments held by the Company in non-consolidated entities | $ 1,400,000 | $ 1,400,000 | ||||||||||
Eaton Vance CLO 2019-1 [Member] | ||||||||||||
Variable Interest Entity [Line Items] | ||||||||||||
Contribution to a CLO entity | $ 40,000,000 | |||||||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 160,000,000 | |||||||||||
Percentage of equity interest purchased in CLO entity | 100.00% | |||||||||||
Distribution from CLO entity | $ 40,000,000 | |||||||||||
Payment to acquire subordinated notes | $ 28,900,000 | |||||||||||
Eaton Vance CLO 2018-1 [Member] | ||||||||||||
Variable Interest Entity [Line Items] | ||||||||||||
Percentage of equity interest in CLO entity | 93.00% | 93.00% | 93.00% | 93.00% | ||||||||
Eaton Vance CLO 2014-1R [Member] | ||||||||||||
Variable Interest Entity [Line Items] | ||||||||||||
Percentage of equity interest in CLO entity | 100.00% | 100.00% | 100.00% | 100.00% | ||||||||
Privately Offered Equity Fund [Member] | Promissory Note [Member] | ||||||||||||
Variable Interest Entity [Line Items] | ||||||||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 25,000,000 | $ 25,000,000 | ||||||||||
Line of credit, amount outstanding | 3,700,000 | 3,700,000 | ||||||||||
Line of credit, amount paid | $ 3,700,000 | |||||||||||
Consolidated Securitized CLO Entities [Member] | ||||||||||||
Variable Interest Entity [Line Items] | ||||||||||||
Total variable interest in consolidated securitized CLO entities equal to the net carrying amount | $ 114,315,000 | $ 68,173,000 | $ 114,315,000 | $ 68,173,000 |
Variable Interest Entities (I_2
Variable Interest Entities (Investments in VIEs That Are Not Consolidated - Narrative) (Details) - USD ($) $ in Millions | May 15, 2019 | May 01, 2019 | Oct. 31, 2018 | Jul. 31, 2019 |
Variable Interest Entity, Not Primary Beneficiary [Member] | ||||
Non-Consolidated CLO Entities [Abstract] | ||||
Total collateral management fees receivable held by the Company in non-consolidated entities | $ 0.1 | $ 0.1 | ||
Eaton Vance CLO 2013-1 [Member] | ||||
Non-Consolidated CLO Entities [Abstract] | ||||
Company's subordinated interest in non-consolidated CLO entities | 100.00% | 100.00% | 100.00% | |
Total investments held by the Company in non-consolidated entities | $ 1.4 | |||
Other Entities [Member] | ||||
Other Entities [Abstract] | ||||
Total assets of the privately offered equity funds that the Company holds a variable interest in but is not deemed to be a primary beneficiary | 21,800 | 25,300 | ||
Total investments in the privately offered equity funds that the Company holds a variable interest in but is not deemed to be a primary beneficiary | 2.7 | 0.5 | ||
Total investment advisory fees receivable from the privately offered equity funds that the Company holds a variable interest in but is not deemed to be a primary beneficiary | 1.3 | 1.5 | ||
Variable interest investment in private equity partnership that is not consolidated | $ 3.5 | $ 3.5 |
Variable Interest Entities (Sch
Variable Interest Entities (Schedule of the Balances Related to Consolidated Sponsored Funds (Details) - USD ($) $ in Thousands | Jul. 31, 2019 | Oct. 31, 2018 |
Schedule Of Consolidated Funds [Line Items] | ||
Other assets | $ 95,195 | $ 95,454 |
Other liabilities | (115,633) | (131,952) |
Redeemable non-controlling interests | (346,163) | (335,097) |
Consolidated Sponsored Funds [Member] | ||
Schedule Of Consolidated Funds [Line Items] | ||
Investments | 551,142 | 540,582 |
Other assets | 30,626 | 15,471 |
Other liabilities | (38,847) | (57,286) |
Redeemable non-controlling interests | (258,207) | (244,970) |
Net interest in consolidated sponsored funds | $ 284,714 | $ 253,797 |
Variable Interest Entities (Sum
Variable Interest Entities (Summary of the Carrying Amounts Related to VIE that are Consolidated on the Companys Balance Sheet) (Details) - USD ($) $ in Thousands | Jul. 31, 2019 | Oct. 31, 2018 |
Assets of consolidated CLO entities: | ||
Cash | $ 87,755 | $ 216,598 |
Bank loans and other investments | 1,706,350 | 874,304 |
Other assets | 21,983 | 4,464 |
Consolidated Securitized CLO Entities [Member] | ||
Assets of consolidated CLO entities: | ||
Cash | 87,755 | 216,598 |
Bank loans and other investments | 1,706,350 | 874,304 |
Receivable for pending bank loan sales | 18,514 | 2,535 |
Other assets | 3,469 | 1,929 |
Liabilities of consolidated CLO entities: | ||
Senior and subordinated note obligations | 1,620,598 | 873,008 |
Payable for pending bank loan purchases | 66,301 | 152,152 |
Other liabilities | 14,874 | 2,033 |
Total beneficial interests | $ 114,315 | $ 68,173 |
Variable Interest Entities (S_2
Variable Interest Entities (Summary of the Amounts Related to VIE that are Consolidated on the Companys Income Statement) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | |
Other Income (Expense) Of Consolidated Variable Interest Entity [Abstract] | ||||
Gains and other investment income, net | $ 18,260 | $ 1,847 | $ 45,495 | $ 4,823 |
Interest and other expense | (21,748) | (3,092) | (40,905) | (3,630) |
Consolidated Securitized CLO Entities [Member] | ||||
Other Income (Expense) Of Consolidated Variable Interest Entity [Abstract] | ||||
Gains and other investment income, net | 20,254 | (60) | 42,187 | (60) |
Interest and other expense | (21,490) | (2,093) | (39,415) | (2,093) |
Net gain (loss) attributable to the Company | (1,236) | (2,153) | 2,772 | (2,153) |
Consolidated Warehouse CLO Entity [Member] | ||||
Other Income (Expense) Of Consolidated Variable Interest Entity [Abstract] | ||||
Gains and other investment income, net | (1,994) | 1,907 | 3,308 | 4,883 |
Interest and other expense | (258) | (999) | (1,490) | (1,537) |
Net gain (loss) attributable to the Company | $ (2,252) | $ 908 | $ 1,818 | $ 3,346 |
Variable Interest Entities (S_3
Variable Interest Entities (Summary of Application of the Measurement Alternative Results in the Companys Earnings from Consolidated VIE Subsequent to Initial Consolidation) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | |
Variable Interest Entity [Line Items] | ||||
Revenue | $ 431,235 | $ 428,691 | $ 1,249,512 | $ 1,261,627 |
Equity in net income of affiliates, net of tax | 2,235 | 2,750 | 6,918 | 8,877 |
Total Management Fees [Member] | ||||
Variable Interest Entity [Line Items] | ||||
Revenue | 375,747 | 368,961 | 1,085,881 | 1,086,894 |
Consolidated Securitized CLO Entities [Member] | ||||
Variable Interest Entity [Line Items] | ||||
Distribution received and unrealized gains (losses) on the senior and subordinated interests held | (2,943) | (2,390) | (1,072) | (2,390) |
Equity in net income of affiliates, net of tax | (1,236) | (2,153) | 2,772 | (2,153) |
Consolidated Securitized CLO Entities [Member] | Total Management Fees [Member] | ||||
Variable Interest Entity [Line Items] | ||||
Revenue | $ 1,707 | $ 237 | $ 3,844 | $ 237 |
Derivative Financial Instrume_3
Derivative Financial Instruments Designated as Cash Flow Hedges (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | |
Senior Notes 2027 [Member] | ||||
Derivative Cash Flow Hedge [Line Items] | ||||
Gain (loss) expected to be reclassified as interest expense on derivative financial instruments designated as cash flow hedges, over the next twelve months | $ 68,000 | |||
Total unamortized loss balance on interest rate lock expected to be reclassified to earnings | 500,000 | |||
Loss reclassified to interest expense on derivative financial instruments designated as cash flow hedges | $ 17,000 | $ 17,000 | 51,000 | $ 51,000 |
Senior Notes 2023 [Member] | ||||
Derivative Cash Flow Hedge [Line Items] | ||||
Gain reclassified to interest expense on derivative financial instruments designated as cash flow hedges | $ 50,000 | $ 50,000 | 200,000 | $ 200,000 |
Gain (loss) expected to be reclassified as interest expense on derivative financial instruments designated as cash flow hedges, over the next twelve months | 200,000 | |||
Total unamortized loss balance on interest rate lock expected to be reclassified to earnings | $ 800,000 |
Derivative Financial Instrume_4
Derivative Financial Instruments Not Designated for Hedge Accounting (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Jul. 31, 2019USD ($)Number | Jul. 31, 2018USD ($) | Jul. 31, 2019USD ($)Number | Jul. 31, 2018USD ($) | Oct. 31, 2018USD ($)Number | |
Derivative [Line Items] | |||||
Other assets fair value | $ 1,437 | $ 1,437 | $ 6,347 | ||
Other liabilities fair value | 15,185 | 15,185 | 4,446 | ||
Net gains (losses) | (1,748) | $ (2,624) | (13,315) | $ (6,934) | |
Other assets | 95,195 | 95,195 | 95,454 | ||
Collateral Pledged [Member] | |||||
Derivative [Line Items] | |||||
Other assets | $ 20,700 | $ 20,700 | $ 13,100 | ||
Credit Default Swap Contracts [Member] | |||||
Derivative [Line Items] | |||||
Number of contracts | Number | 1 | 1 | 1 | ||
Notional amount of other derivative financial instruments not designated for hedge accounting | $ 8,000 | $ 8,000 | $ 5,000 | ||
Other assets fair value | 220 | 220 | 0 | ||
Other liabilities fair value | 0 | 0 | $ 10 | ||
Net gains (losses) | $ (135) | 150 | $ (280) | 150 | |
Total Return Swap Contracts [Member] | |||||
Derivative [Line Items] | |||||
Number of contracts | Number | 4 | 4 | 3 | ||
Notional amount of other derivative financial instruments not designated for hedge accounting | $ 124,900 | $ 124,900 | $ 106,500 | ||
Other assets fair value | 50 | 50 | 0 | ||
Other liabilities fair value | 10,705 | 10,705 | $ 3,297 | ||
Net gains (losses) | $ (596) | (1,526) | $ (5,547) | (2,535) | |
Stock Index Futures Contracts [Member] | |||||
Derivative [Line Items] | |||||
Number of contracts | Number | 1,104 | 1,104 | 1,007 | ||
Notional amount of other derivative financial instruments not designated for hedge accounting | $ 144,700 | $ 144,700 | $ 91,500 | ||
Other assets fair value | 399 | 399 | 5,055 | ||
Other liabilities fair value | 1,805 | 1,805 | $ 372 | ||
Net gains (losses) | $ 856 | (1,448) | $ (5,041) | (3,385) | |
Commodity Futures Contracts [Member] | |||||
Derivative [Line Items] | |||||
Number of contracts | Number | 292 | 292 | 253 | ||
Notional amount of other derivative financial instruments not designated for hedge accounting | $ 12,100 | $ 12,100 | $ 11,600 | ||
Other assets fair value | 94 | 94 | 770 | ||
Other liabilities fair value | 418 | 418 | $ 216 | ||
Net gains (losses) | $ 110 | (346) | $ (913) | (1,066) | |
Foreign Exchange Contract [Member] | |||||
Derivative [Line Items] | |||||
Number of contracts | Number | 44 | 44 | 28 | ||
Notional amount of other derivative financial instruments not designated for hedge accounting | $ 95,500 | $ 95,500 | $ 23,000 | ||
Other assets fair value | 403 | 403 | 329 | ||
Other liabilities fair value | 1,262 | 1,262 | $ 202 | ||
Net gains (losses) | $ (1,609) | 302 | $ (1,548) | (326) | |
Currency Futures Contracts [Member] | |||||
Derivative [Line Items] | |||||
Number of contracts | Number | 191 | 191 | 165 | ||
Notional amount of other derivative financial instruments not designated for hedge accounting | $ 20,200 | $ 20,200 | $ 16,900 | ||
Other assets fair value | 210 | 210 | 14 | ||
Other liabilities fair value | 196 | 196 | $ 332 | ||
Net gains (losses) | $ 633 | 70 | $ 1,923 | 72 | |
Interest Rate Futures Contracts [Member] | |||||
Derivative [Line Items] | |||||
Number of contracts | Number | 177 | 177 | 282 | ||
Notional amount of other derivative financial instruments not designated for hedge accounting | $ 28,900 | $ 28,900 | $ 48,000 | ||
Other assets fair value | 61 | 61 | 179 | ||
Other liabilities fair value | 799 | 799 | $ 17 | ||
Net gains (losses) | $ (1,007) | $ 174 | $ (1,909) | $ 156 |
Fair Value of Assets and Liab_3
Fair Value of Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands | Jul. 31, 2019 | Oct. 31, 2018 |
Fair Value Measurement [Domain] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | $ 110,084 | $ 139,332 |
Investments held at cost | 20,904 | 20,874 |
Investments in equity method investees | 140,174 | 141,506 |
Derivative instruments, assets | 1,437 | 6,347 |
Bank loans and other investments | 1,706,350 | 874,304 |
Total financial assets | 2,861,897 | 2,098,610 |
Derivative instruments, liabilities | 15,185 | 4,446 |
Senior and subordinated note obligations | 1,620,598 | 873,008 |
Total financial liabilities | 1,635,783 | 877,454 |
Fair Value Measurement [Domain] | Separately Managed Accounts [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investment securities, trading | 52,017 | 65,060 |
Investment securities | 20,159 | 24,061 |
Fair Value Measurement [Domain] | Debt Funds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investment securities, trading | 336,440 | 404,973 |
Fair Value Measurement [Domain] | Non-consolidated Sponsored Funds and Other [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investment securities | 8,291 | 10,329 |
Fair Value Measurement [Domain] | Equity Funds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investment securities | 214,702 | 135,609 |
Investments held at cost | 20,904 | 20,874 |
Short-term Debt Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investment securities, trading | 250,088 | 273,320 |
Investments in non-consolidated CLO entities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Alternative investment | 1,251 | 2,895 |
Portion at Other than Fair Value Measurement [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 0 | 0 |
Investments held at cost | 20,904 | 20,874 |
Investments in equity method investees | 140,174 | 141,506 |
Derivative instruments, assets | 0 | 0 |
Bank loans and other investments | 0 | 0 |
Total financial assets | 162,329 | 165,275 |
Derivative instruments, liabilities | 0 | 0 |
Senior and subordinated note obligations | 0 | 0 |
Total financial liabilities | 0 | 0 |
Portion at Other than Fair Value Measurement [Member] | Short-term Debt Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investment securities, trading | 0 | 0 |
Portion at Other than Fair Value Measurement [Member] | Separately Managed Accounts [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investment securities, trading | 0 | 0 |
Investment securities | 0 | 0 |
Portion at Other than Fair Value Measurement [Member] | Debt Funds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investment securities, trading | 0 | 0 |
Portion at Other than Fair Value Measurement [Member] | Non-consolidated Sponsored Funds and Other [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investment securities | 0 | 0 |
Portion at Other than Fair Value Measurement [Member] | Equity Funds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investment securities | 0 | 0 |
Portion at Other than Fair Value Measurement [Member] | Investments in non-consolidated CLO entities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Alternative investment | 1,251 | 2,895 |
Level 1 [Member] | Fair Value Measurement [Domain] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 17,267 | 23,262 |
Investments held at cost | 0 | 0 |
Investments in equity method investees | 0 | 0 |
Derivative instruments, assets | 0 | 0 |
Bank loans and other investments | 0 | 0 |
Total financial assets | 113,942 | 140,662 |
Derivative instruments, liabilities | 0 | 0 |
Senior and subordinated note obligations | 0 | 0 |
Total financial liabilities | 0 | 0 |
Level 1 [Member] | Fair Value Measurement [Domain] | Separately Managed Accounts [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investment securities, trading | 0 | 521 |
Investment securities | 20,068 | 23,642 |
Level 1 [Member] | Fair Value Measurement [Domain] | Debt Funds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investment securities, trading | 0 | 12,834 |
Level 1 [Member] | Fair Value Measurement [Domain] | Non-consolidated Sponsored Funds and Other [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investment securities | 7,783 | 7,112 |
Level 1 [Member] | Fair Value Measurement [Domain] | Equity Funds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investment securities | 68,824 | 73,291 |
Level 1 [Member] | Short-term Debt Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investment securities, trading | 0 | 0 |
Level 1 [Member] | Investments in non-consolidated CLO entities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Alternative investment | 0 | 0 |
Level 2 [Member] | Fair Value Measurement [Domain] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 92,817 | 116,070 |
Investments held at cost | 0 | 0 |
Investments in equity method investees | 0 | 0 |
Derivative instruments, assets | 1,437 | 6,347 |
Bank loans and other investments | 1,703,576 | 872,757 |
Total financial assets | 2,582,852 | 1,791,126 |
Derivative instruments, liabilities | 15,185 | 4,446 |
Senior and subordinated note obligations | 1,620,598 | 873,008 |
Total financial liabilities | 1,635,783 | 877,454 |
Level 2 [Member] | Fair Value Measurement [Domain] | Separately Managed Accounts [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investment securities, trading | 52,017 | 64,539 |
Investment securities | 91 | 419 |
Level 2 [Member] | Fair Value Measurement [Domain] | Debt Funds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investment securities, trading | 336,440 | 392,139 |
Level 2 [Member] | Fair Value Measurement [Domain] | Non-consolidated Sponsored Funds and Other [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investment securities | 508 | 3,217 |
Level 2 [Member] | Fair Value Measurement [Domain] | Equity Funds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investment securities | 145,878 | 62,318 |
Level 2 [Member] | Short-term Debt Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investment securities, trading | 250,088 | 273,320 |
Level 2 [Member] | Investments in non-consolidated CLO entities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Alternative investment | 0 | 0 |
Level 3 [Member] | Fair Value Measurement [Domain] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 0 | 0 |
Investments held at cost | 0 | 0 |
Investments in equity method investees | 0 | 0 |
Derivative instruments, assets | 0 | 0 |
Bank loans and other investments | 2,774 | 1,547 |
Total financial assets | 2,774 | 1,547 |
Derivative instruments, liabilities | 0 | 0 |
Senior and subordinated note obligations | 0 | 0 |
Total financial liabilities | 0 | 0 |
Level 3 [Member] | Fair Value Measurement [Domain] | Separately Managed Accounts [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investment securities, trading | 0 | 0 |
Investment securities | 0 | 0 |
Level 3 [Member] | Fair Value Measurement [Domain] | Debt Funds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investment securities, trading | 0 | 0 |
Level 3 [Member] | Fair Value Measurement [Domain] | Non-consolidated Sponsored Funds and Other [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investment securities | 0 | 0 |
Level 3 [Member] | Fair Value Measurement [Domain] | Equity Funds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investment securities | 0 | 0 |
Level 3 [Member] | Short-term Debt Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investment securities, trading | 0 | 0 |
Level 3 [Member] | Investments in non-consolidated CLO entities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Alternative investment | $ 0 | $ 0 |
Fair Value of Assets and Liab_4
Fair Value of Assets and Liabilities Measured at Fair Value on a Recurring Basis Level 3 (Details) - Bank Loan Investments of Consolidated CLO Entities [Member] - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | |
Fair Value Assets And Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||||
Beginning balance | $ 1,138 | $ 0 | $ 1,547 | $ 0 |
Paydowns | (7) | (19) | ||
Net gains (losses) included in net income | 320 | (77) | ||
Consolidation of CLO entities | 1,323 | 2,388 | 1,323 | 2,388 |
Ending balance | $ 2,774 | $ 2,388 | $ 2,774 | $ 2,388 |
Fair Value of Assets and Liab_5
Fair Value of Assets and Liabilities Measured at Fair Value on a Recurring Basis (Summary of the Carrying Amounts and Estimated Fair Values of These Financial Instruments) (Details) - USD ($) $ in Thousands | Jul. 31, 2019 | Oct. 31, 2018 |
Carrying And Fair Value [Line Items] | ||
Carrying value of loan to affiliate | $ 5,000 | $ 5,000 |
Carrying value of debt | 620,304 | 619,678 |
Level 2 [Member] | ||
Carrying And Fair Value [Line Items] | ||
Carrying value of debt | 620,304 | 619,678 |
Fair value of debt | 648,509 | 607,391 |
Level 3 [Member] | ||
Carrying And Fair Value [Line Items] | ||
Carrying value of loan to affiliate | 5,000 | 5,000 |
Fair value of loan to affiliate | $ 5,000 | $ 5,000 |
Fair Value of Assets and Liab_6
Fair Value of Assets and Liabilities Measured at Fair Value on a Recurring Basis (Narrative) (Details) - USD ($) $ in Thousands | Jul. 31, 2019 | Oct. 31, 2018 |
Carrying And Fair Value [Line Items] | ||
Loan to affiliate | $ 5,000 | $ 5,000 |
Acquisitions (Narrative) (Detai
Acquisitions (Narrative) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||
Jan. 31, 2019 | Jan. 31, 2018 | Oct. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2019 | Jan. 31, 2014 | Jan. 31, 2013 | |
Parametric Portfolio Associates [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Non-controlling interest holders capital ownership percentage, end of period | 0.80% | 0.60% | |||||
Non-controlling interest holders total (direct and indirect) profits interest, end of period | 5.10% | 4.90% | |||||
Atlanta Capital [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Non-controlling interest holders total (direct and indirect) profits interest, end of period | 9.80% | 9.80% | |||||
Purchase of non-controlling interests | $ 3,200,000 | ||||||
Amount paid for indirect profit interest pursuant to the put and call provisions of the Long-term Equity Incentive Plan | $ 8,200,000 | 4,200,000 | |||||
Payments for repurchase of redeemable noncontrolling interest | $ 2,500,000 | ||||||
Estimated fair value of noncontrolling interests | 26,300,000 | $ 27,400,000 | |||||
Parametric Portfolio Associates [Member] | Parametric Risk Advisors [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Purchase of non-controlling interests | $ 4,000,000 | ||||||
Estimated fair value of noncontrolling interests | $ 15,900,000 | $ 11,900,000 | |||||
Noncontrolling capital and profits interest issued in acquisition | 20.00% | ||||||
Noncontrolling Indirect Profit Interest Acquired In Exchange | 0.20% | 0.80% | |||||
Noncontrolling Indirect Capital Interest Acquired In Exchange | 0.20% | 0.80% | |||||
Redeemable Noncontrolling Interest Exercise Term | 4 years | ||||||
Parametric Portfolio Associates [Member] | Clifton Group [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Company's increase in capital interest percentage under acquisition agreement, during the period | 0.50% | ||||||
Company's increase in profit interest percentage under acquisition agreement, during the period | 0.50% | ||||||
Purchase of non-controlling interests | $ 8,400,000 | ||||||
Noncontrolling Indirect Profit Interest Acquired In Exchange | 1.90% | ||||||
Noncontrolling Indirect Capital Interest Acquired In Exchange | 1.90% | ||||||
Parametric Portfolio Associates [Member] | Parametric Plan [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Non-controlling interest holders total (direct and indirect) profits interest, end of period | 4.30% | 4.30% | |||||
Amount paid for indirect profit interest pursuant to the put and call provisions of the Long-term Equity Incentive Plan | $ 5,900,000 | $ 5,700,000 | |||||
Estimated fair value of noncontrolling interests | $ 47,900,000 | $ 48,700,000 |
Intangible Assets (Narrative) (
Intangible Assets (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | |
Intangible Assets [Abstract] | ||||
Amortizing intangible assets amortization expense | $ 1 | $ 2.2 | $ 3.9 | $ 6.7 |
Intangible Assets (Schedule of
Intangible Assets (Schedule of the Carrying Amounts of Intangible Assets) (Details) - USD ($) $ in Thousands | Jul. 31, 2019 | Oct. 31, 2018 |
Amortizing intangible assets: | ||
Accumulated amortization | $ (117,619) | $ (113,691) |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ||
Gross intangible assets | 194,576 | 194,576 |
Accumulated amortization | (117,619) | (113,691) |
Intangible assets, net | 76,957 | 80,885 |
Mutual Fund Management Contract Acquired [Member] | ||
Non-amortizing intangible assets: | ||
Net carrying amount | 54,408 | 54,408 |
Client Relationships Acquired [Member] | ||
Amortizing intangible assets: | ||
Gross carrying amount | 134,247 | 134,247 |
Accumulated amortization | (115,034) | (111,591) |
Net carrying amount | 19,213 | 22,656 |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ||
Accumulated amortization | (115,034) | (111,591) |
Intellectual Property Acquired [Member] | ||
Amortizing intangible assets: | ||
Gross carrying amount | 1,025 | 1,025 |
Accumulated amortization | (569) | (519) |
Net carrying amount | 456 | 506 |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ||
Accumulated amortization | (569) | (519) |
Trademark Acquired [Member] | ||
Amortizing intangible assets: | ||
Gross carrying amount | 4,257 | 4,257 |
Accumulated amortization | (1,466) | (1,190) |
Net carrying amount | 2,791 | 3,067 |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ||
Accumulated amortization | (1,466) | (1,190) |
Research System Aquired [Member] | ||
Amortizing intangible assets: | ||
Gross carrying amount | 639 | 639 |
Accumulated amortization | (550) | (391) |
Net carrying amount | 89 | 248 |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ||
Accumulated amortization | $ (550) | $ (391) |
Intangible Assets (Schedule o_2
Intangible Assets (Schedule of Estimated Amortization Expense for the Remainder of the Fiscal Year and the Next Five Fiscal Years) (Details) $ in Thousands | Jul. 31, 2019USD ($) |
Estimated amortization expense | |
Remaining 2019 | $ 1,050 |
2020 | 3,807 |
2021 | 2,282 |
2022 | 2,154 |
2023 | 1,754 |
2024 | $ 1,679 |
Revenue (Narrative) (Details)
Revenue (Narrative) (Details) - USD ($) $ in Millions | Jul. 31, 2019 | Oct. 31, 2018 |
Revenue [ Abstract] | ||
Management fees and other receivables from contracts with customers | $ 229 | $ 221.4 |
Deferred revenue reported in other liabilities | $ 6.8 | $ 4.9 |
Revenue (Schedule of revenue ea
Revenue (Schedule of revenue earned) (Details) - Accounting Standards Update 2014-09 [Member] - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | |
Disaggregation Of Revenue [Line Items] | ||||
Total revenue | $ 431,235 | $ 428,691 | $ 1,249,512 | $ 1,261,627 |
Management Fees: Sponsored Funds [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Total revenue | 256,620 | 257,554 | 742,750 | 757,217 |
Management Fees: Seperate Accounts [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Total revenue | 119,127 | 111,407 | 343,131 | 329,677 |
Total Management Fees [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Total revenue | 375,747 | 368,961 | 1,085,881 | 1,086,894 |
Distribution And Underwriter Fees: Distribution Fees [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Total revenue | 15,317 | 19,360 | 49,168 | 58,113 |
Distribution And Underwriter Fees: Underwriter Commissions [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Total revenue | 5,964 | 5,378 | 15,257 | 15,729 |
Total Distribution And Underwriter Fees [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Total revenue | 21,281 | 24,738 | 64,425 | 73,842 |
Service Fees [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Total revenue | 31,855 | 31,053 | 90,801 | 90,867 |
Other Revenue [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Total revenue | $ 2,352 | $ 3,939 | $ 8,405 | $ 10,024 |
Revenue (Management fee revenue
Revenue (Management fee revenue by investment mandate) (Details) - Accounting Standards Update 2014-09 [Member] - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | |
Disaggregation Of Revenue [Line Items] | ||||
Revenue | $ 431,235 | $ 428,691 | $ 1,249,512 | $ 1,261,627 |
Total Management Fees [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Revenue | 375,747 | 368,961 | 1,085,881 | 1,086,894 |
Management Fees: Equity [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Revenue | 180,081 | 176,205 | 516,290 | 522,240 |
Management Fees: Fixed Income [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Revenue | 73,514 | 65,209 | 209,344 | 193,419 |
Management Fees: Floating Rate Income [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Revenue | 48,906 | 53,944 | 151,989 | 155,640 |
Management Fees: Alternative [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Revenue | 15,371 | 22,470 | 45,672 | 65,582 |
Management Fees: Portfolio Implementation [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Revenue | 47,046 | 40,165 | 131,082 | 116,957 |
Management Fees: Exposure Management [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Revenue | $ 10,829 | $ 10,968 | $ 31,504 | $ 33,056 |
Stock-Based Compensation Plan_2
Stock-Based Compensation Plans (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | $ 23,541 | $ 22,840 | $ 68,827 | $ 68,277 |
Tax benefits recognized for stock-based compensation arrangements | 5,700 | 5,800 | 15,900 | 16,700 |
Employee stock purchase plans [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | 179 | 312 | 355 | 793 |
Employee Stock Purchase Incentive Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | 90 | 129 | 467 | 818 |
Omnibus Incentive Plans [Member] | Stock Option [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | 6,212 | 5,931 | 16,774 | 18,337 |
Omnibus Incentive Plans [Member] | Restricted Stock [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | 14,827 | 13,897 | 43,327 | 39,974 |
Omnibus Incentive Plans [Member] | Deferred Stock Units [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | 121 | 49 | 860 | 978 |
Atlanta Capital Plan [Member] | Employee Stock Purchase Incentive Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | 569 | 743 | 1,709 | 2,227 |
Atlanta Capital Plan [Member] | Phantom Incentive Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | 274 | 143 | 813 | 424 |
Parametric Plan [Member] | Employee Stock Purchase Incentive Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | 368 | 794 | 1,708 | 2,383 |
Parametric Plan [Member] | Phantom Incentive Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | $ 901 | $ 842 | $ 2,814 | $ 2,343 |
Stock-Based Compensation Plan_3
Stock-Based Compensation Plans (Stock option transactions) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 9 Months Ended | |
Jul. 31, 2019 | Jul. 31, 2018 | |
Stock option transactions | ||
Options outstanding, beginning of period shares | 16,760 | |
Granted shares | 2,469 | |
Exercised shares | (803) | |
Forfeited/expired shares | (60) | |
Options outstanding, end of period shares | 18,366 | |
Options exercisable, end of period shares | 9,692 | |
Options outstanding weighted-average exercise price, beginning of period ($ per share) | $ 35.23 | |
Granted, weighted-average exercise price ($ per share) | 45.37 | |
Exercised weighted-average exercise price ($ per share) | 29.14 | |
Forfeited/expired weighted-average exercise price ($ per share) | 40.44 | |
Options outstanding weighted-average exercise price, end of period ($ per share) | 36.84 | |
Options exercisable, weighted-average exercise price, end of period ($ per share) | $ 32.98 | |
Options outstanding weighted-average remaining contractual term, end of period (in years) | 5 years 8 months 12 days | |
Options exercisable weighted-average remaining contractual term, end of period (in years) | 3 years 10 months 24 days | |
Options outstanding, aggregate intrinsic value, end of period | $ 153,855 | |
Options exercisable, aggregate intrinsic value, end of period | 112,735 | |
Cash received from exercises of stock options under equity incentive plans | 22,900 | $ 54,700 |
Compensation cost related to unvested stock options granted under the Company's Omnibus Incentive Plans, not yet recognized | $ 44,700 | |
Weighted-average period over which compensation cost related to unvested options is expected to be recognized (in years) | 2 years 6 months |
Stock-Based Compensation Plan_4
Stock-Based Compensation Plans (Restricted Stock and Deferred Stock Units) (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Jan. 31, 2019 | Jan. 31, 2018 | Jul. 31, 2019 | Oct. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Unvested, beginning of period shares | 4,544,000 | 4,544,000 | ||
Granted shares | 1,746,000 | |||
Vested shares | (1,315,000) | |||
Forfeited shares | (100,000) | |||
Unvested, end of period shares | 4,875,000 | |||
Unvested weighted-average grant date fair value, beginning of period ($ per share) | $ 40.70 | $ 40.70 | ||
Granted weighted-average grant date fair value ($ per share) | 44.87 | |||
Vested weighted-average grant date fair value ($ per share) | 39.23 | |||
Forfeited weighted-average grant date fair value ($ per share) | 42.95 | |||
Unvested weighted-average grant date fair value, end of period ($ per share) | $ 42.55 | |||
Restricted Stock [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Share-based Awards Other than Options | $ 137.6 | |||
Weighted-average period over which compensation cost related to restricted shares is expected to be recognized (in years) | 2 years 10 months 24 days | |||
Deferred Stock Units [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Share-based Awards Other than Options | $ 1.6 | $ 1.3 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Shares Issued in Period | 19,429 | |||
Deferred stock unit liability paid out | $ 0.5 | $ 0.4 |
Common Stock Repurchases (Detai
Common Stock Repurchases (Details) shares in Millions | 9 Months Ended |
Jul. 31, 2019shares | |
Equity, Class of Treasury Stock [Line Items] | |
Amount of non-voting common stock shares authorized by the Company's Board of Directors to be repurchased under the current share repurchase plan | 8 |
Date on which the current Non-Voting Common Stock share repurchase program was announced | Jul. 10, 2019 |
Non-Voting Common Stock Current Repurchase Authorization [Member] | |
Equity, Class of Treasury Stock [Line Items] | |
Non-voting common stock shares repurchased and retired under the Company's current share repurchase plan during the period | 0.4 |
Non-voting shares remaining to be repurchased and retired under the Company's current share repurchase plan as of the end of the period | 7.6 |
Non-Voting Common Stock Previous Repurchase Authorization [Member] | |
Equity, Class of Treasury Stock [Line Items] | |
Non-voting common stock shares repurchased and retired under the Company's current share repurchase plan during the period | 5.8 |
Non-operating income (expense_2
Non-operating income (expense) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | |
Interest and other income | $ 11,507 | $ 10,247 | $ 32,861 | $ 26,616 |
Net gain (losses) on investments and derivatives | 3,440 | (3,120) | 3,509 | (16,453) |
Net foreign currency gains (losses) | (101) | 4 | (485) | (695) |
Gains and other investment income, net | 14,846 | 7,131 | 35,885 | 9,468 |
Interest expense | (5,888) | (5,906) | (17,907) | (17,716) |
Other income (expense) of consolidated CLO entities: | ||||
Interest income | 22,268 | 4,505 | 49,077 | 6,193 |
Net losses on bank loans and other investments note obligations | (4,008) | (2,658) | (3,582) | (1,370) |
Gains and other investment income, net | 18,260 | 1,847 | 45,495 | 4,823 |
Structuring and closing fees | (5,429) | 0 | (5,548) | 0 |
Interest expense | (16,319) | (3,092) | (35,357) | (3,630) |
Interest and other expense | (21,748) | (3,092) | (40,905) | (3,630) |
Total non-operating income (expense) | $ 5,470 | $ (20) | $ 22,568 | $ (7,055) |
Hexavest [Member] | ||||
Other income (expense) of consolidated CLO entities: | ||||
Additional Interest That May Be Purchased By The Company | 26.00% | 26.00% | ||
Loss recognized on option write-off | $ 6,500 |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) $ in Thousands | Jan. 01, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | Dec. 31, 2017 |
Income Tax [Abstract] | ||||||
Income taxes | $ 36,304 | $ 37,219 | $ 100,998 | $ 119,880 | ||
Effective income tax rate (as a percent) | 25.50% | 26.20% | 24.80% | 29.70% | ||
Federal statutory rate (as a percent) | 21.00% | 21.00% | 35.00% | |||
Non-recurring charge to Income Taxes to reflect the estimated impact of the enactment of the Tax Cuts and Jobs Act | $ 24,800 | |||||
Charge to income taxes to reflect the revaluation of the Company's deferred tax assets and liabilities to reflect the impact of the enactment of the Tax Cuts and Jobs Act | 21,700 | |||||
Charge to income taxes to reflect the deemed repatriation of foreign-source net earnings to reflect the impact of the enactment of the Tax Cuts and Jobs Act | 3,100 | |||||
Income tax expense on net income attributable to redeemable non-controlling and other beneficial interests not taxable by the Company | $ 2,200 | $ 1,700 | $ 5,300 | 4,500 | ||
Net excess tax benefit attributable to the exercise of employee stock options and vesting of restricted stock awards | 600 | $ 1,300 | 3,900 | $ 15,100 | ||
Income tax provision principally related to limitations on the deductibility of executive compensation related to 2017 Tax Act taking effect in current period | 1,100 | 2,400 | ||||
Canadian Affliate [Member] | ||||||
Income Taxes [Line Items] | ||||||
Dividends received | 65,200 | |||||
Tax expense reduction due to a realized foreign exchange loss | 500 | |||||
United Kingdom [Member] | ||||||
Income Taxes [Line Items] | ||||||
Undistributed earnings of certain foreign subsidiaries | $ 16,600 | $ 16,600 |
Income Taxes (Reconciliation of
Income Taxes (Reconciliation of the Difference Between the Companys Effective Tax Rate and the U.S. Federal Statutory Tax Rate) (Details) | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | |
Reconconciliation to the Company's effective income tax rate | ||||
Statutory U.S. federal income tax rate (as a percent) | 21.00% | 23.30% | 21.00% | 23.30% |
State income tax, net of federal income tax benefits | 5.00% | 4.40% | 4.60% | 4.30% |
Net income attributable to non-controlling and other beneficial interests | (1.30%) | (1.00%) | (1.00%) | (0.90%) |
Non-recurring impact of U.S. tax reform | 0.00% | 0.00% | 0.00% | 6.10% |
Net excess tax benefits from stock-based compensation plans | (0.40%) | (0.90%) | (0.90%) | (3.70%) |
Other items | 1.20% | 0.40% | 1.10% | 0.60% |
Effective income tax rate | 25.50% | 26.20% | 24.80% | 29.70% |
Non-Controlling and Other Ben_3
Non-Controlling and Other Beneficial Interests (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | |
Noncontrolling Interest [Line Items] | ||||
Net income attributable to non-controlling and other beneficial interests | $ (6,315) | $ (5,981) | $ (23,097) | $ (16,241) |
Consolidated Sponsored Funds [Member] | ||||
Noncontrolling Interest [Line Items] | ||||
Net income attributable to non-controlling and other beneficial interests | (2,760) | (1,862) | (13,323) | (4,215) |
Majority-owned subsidiaries [Member] | ||||
Noncontrolling Interest [Line Items] | ||||
Net income attributable to non-controlling and other beneficial interests | $ (3,555) | $ (4,119) | $ (9,774) | $ (12,026) |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | Oct. 31, 2018 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Beginning balance | $ 1,108,431 | ||||
Other comprehensive income (loss), net of tax | $ 1,680 | $ (5,637) | (3,040) | $ (2,636) | |
Ending balance | 1,129,407 | 1,129,407 | |||
Unamortized net gains on cash flow hedges [Member] | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Beginning balance | 150 | 251 | 200 | 301 | |
Cumulative effect adjustment upon adoption of new accounting standard | 0 | 0 | |||
Beginning Balance, as adjusted | $ 200 | ||||
Other comprehensive income (loss) before reclassifications and tax | 0 | 0 | 0 | 0 | |
Tax impact | 0 | 0 | 0 | 0 | |
Reclassification adjustments, before tax | (33) | (33) | (100) | (99) | |
Tax impact | 10 | 8 | 27 | 24 | |
Other comprehensive income (loss), net of tax | (23) | (25) | (73) | (75) | |
Ending balance | 127 | 226 | 127 | 226 | |
Net unrealized gains on available-for-sale investments [Member] | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Beginning balance | 0 | 5,160 | 3,714 | 4,128 | |
Cumulative effect adjustment upon adoption of new accounting standard | (3,714) | (3,714) | |||
Beginning Balance, as adjusted | 0 | ||||
Other comprehensive income (loss) before reclassifications and tax | 0 | 514 | 0 | 1,890 | |
Tax impact | 0 | (114) | 0 | (458) | |
Reclassification adjustments, before tax | 0 | (1,861) | 0 | (1,861) | |
Tax impact | 0 | 434 | 0 | 434 | |
Other comprehensive income (loss), net of tax | 0 | (1,027) | 0 | 5 | |
Ending balance | 0 | 4,133 | 0 | 4,133 | |
Foreign currency translation adjustments [Member] | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Beginning balance | (61,765) | (49,884) | (57,095) | (51,903) | |
Cumulative effect adjustment upon adoption of new accounting standard | 0 | 0 | |||
Beginning Balance, as adjusted | (57,095) | ||||
Other comprehensive income (loss) before reclassifications and tax | 1,703 | (4,585) | (2,967) | (2,566) | |
Tax impact | 0 | 0 | 0 | 0 | |
Reclassification adjustments, before tax | 0 | 0 | 0 | 0 | |
Tax impact | 0 | 0 | 0 | 0 | |
Other comprehensive income (loss), net of tax | 1,703 | (4,585) | (2,967) | (2,566) | |
Ending balance | (60,062) | (54,469) | (60,062) | (54,469) | |
Accumulated Other Comprehensive Income (Loss) [Member] | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Beginning balance | (61,615) | (44,473) | (53,181) | (47,474) | |
Cumulative effect adjustment upon adoption of new accounting standard | (3,714) | (3,714) | |||
Beginning Balance, as adjusted | $ (56,895) | ||||
Other comprehensive income (loss) before reclassifications and tax | 1,703 | (4,071) | (2,967) | (676) | |
Tax impact | 0 | (114) | 0 | (458) | |
Reclassification adjustments, before tax | (33) | (1,894) | (100) | (1,960) | |
Tax impact | 10 | 442 | 27 | 458 | |
Other comprehensive income (loss), net of tax | 1,680 | (5,637) | (3,040) | (2,636) | |
Ending balance | (59,935) | $ (50,110) | (59,935) | $ (50,110) | |
Accumulated Other Comprehensive Income (Loss) [Member] | Accounting Standards Update 2016-01 [Member] | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Cumulative effect adjustment upon adoption of new accounting standard | $ (3,714) | $ (3,714) |
Earnings Per Share (Narrative)
Earnings Per Share (Narrative) (Details) - shares shares in Millions | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | |
Earnings Per Share Reconciliation [Abstract] | ||||
Antidilutive common shares | 5.9 | 1.8 | 7.6 | 2.1 |
Earnings Per Share (Summary Sch
Earnings Per Share (Summary Schedule of the Calculation of Earnings Per Basic and Diluted Shares) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | |
Earnings Per Share Reconciliation [Abstract] | ||||
Net income attributable to Eaton Vance Corp. shareholders | $ 102,221 | $ 101,794 | $ 290,829 | $ 276,451 |
Weighted-average shares outstanding - basic | 109,111 | 114,610 | 110,553 | 115,157 |
Incremental common shares | 4,353 | 8,131 | 3,957 | 8,396 |
Weighted-average shares outstanding - diluted | 113,464 | 122,741 | 114,510 | 123,553 |
Earnings per share (Basic) ($ per share) | $ 0.94 | $ 0.89 | $ 2.63 | $ 2.40 |
Earnings per share (Diluted) ($ per share) | $ 0.90 | $ 0.83 | $ 2.54 | $ 2.24 |
Related Party Transactions (Spo
Related Party Transactions (Sponsored Funds Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | Oct. 31, 2018 | |
Sponsored Funds | |||||
Management fees waived by the Company | $ 5 | $ 4.4 | $ 14.1 | $ 13 | |
Related party expenses all-in-management fee (excluding investment advisory and administrative fees) | 3 | 3.5 | 9.7 | 10.2 | |
Sponsored Funds [Member] | |||||
Sponsored Funds | |||||
Subsidies fees waived by the Company | 4.8 | $ 6.6 | 21.9 | $ 18.3 | |
Included in management fees and other accounts receivable | 105 | 105 | $ 104.9 | ||
Included in accounts payable and accrued expenses | $ 2.4 | $ 2.4 | $ 3.2 |
Related Party Transactions (Loa
Related Party Transactions (Loan to Affiliate and Employee Loan Program Narrative) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | Oct. 31, 2018 | |
Loan to Affiliate | |||||
Loan to affiliate | $ 5,000,000 | $ 5,000,000 | $ 5,000,000 | ||
Employee Loan Program | |||||
Minimum fixed borrowing rate under the plan | 0.90% | ||||
Maximum fixed borrowing rate under the plan | 2.90% | ||||
Loan term | 7 years | ||||
Loan due date | Oct. 31, 2022 | ||||
Hexavest Related Parties Agreements [Member] | |||||
Loan to Affiliate | |||||
Loan to affiliate | 5,000,000 | $ 5,000,000 | 5,000,000 | ||
Interest income earned on loan to affiliate | 45,000 | $ 50,000 | 100,000 | $ 100,000 | |
Interest receivable on the loan to affiliate | 15,000 | $ 15,000 | 16,000 | ||
Description of the variable interest rate on the loan to affiliate | Through October 31, 2018, the Company earned interest equal to the one-year Canadian Dollar Offered Rate plus 200 basis points. In November 2018, the Company amended the term loan agreement to reduce the market interest rate of the loan to be equal to the one-year Canadian Dollar Offered Rate plus 100 basis points. | ||||
Employee Loan Program [Member] | |||||
Loan to Affiliate | |||||
Loan to affiliate | 7,900,000 | $ 7,900,000 | 8,100,000 | ||
Employee Loan Program | |||||
Maximum loan amount available under the plan | $ 20,000,000 | $ 20,000,000 | $ 20,000,000 |
Related Party Transactions (Sum
Related Party Transactions (Summary of Related Party Revenue Transactions) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | |
Related Party Transaction [Line Items] | ||||
Management fees | $ 256,620 | $ 257,554 | $ 742,750 | $ 757,217 |
Distribution fees and underwriter fees | 21,281 | 24,738 | 64,425 | 73,842 |
Service fees | 31,855 | 31,053 | 90,801 | 90,867 |
Shareholder services fees included in other revenue | 1,622 | 1,672 | 4,900 | 4,540 |
Total | $ 311,378 | $ 315,017 | $ 902,876 | $ 926,466 |
Related Party Transactions (S_2
Related Party Transactions (Summary of sales proceeds and net realized gains (losses) from investments in non-consolidated sponsored funds) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | |
Related Party Transaction [Line Items] | ||||
Proceeds from sales | $ 1,206 | $ 2,936 | $ 7,831 | $ 7,812 |
Net realized gains | $ 286 | $ 2,066 | $ 5,490 | $ 1,961 |
Geographic Information (Details
Geographic Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | Oct. 31, 2018 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Revenue | $ 431,235 | $ 428,691 | $ 1,249,512 | $ 1,261,627 | |
Long-Lived Assets | 70,534 | 70,534 | $ 52,428 | ||
US [Member] | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Revenue | 415,746 | 411,241 | 1,202,869 | 1,210,837 | |
Long-Lived Assets | 68,909 | 68,909 | 50,459 | ||
Non-US [Member] | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Revenue | 15,489 | $ 17,450 | 46,643 | $ 50,790 | |
Long-Lived Assets | $ 1,625 | $ 1,625 | $ 1,969 |