Document and Entity Information - shares	9 Months Ended
Document and Entity Information - shares	Sep. 30, 2016	Oct. 27, 2016
Entity Registrant Name	Moelis & Co
Entity Central Index Key	0001596967
Document Type	10-Q
Document Period End Date	Sep. 30, 2016
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer
Document Fiscal Year Focus	2016
Document Fiscal Period Focus	Q3
Class A common stock
Entity Common Stock, Shares Outstanding		20,588,226
Class B common stock
Entity Common Stock, Shares Outstanding		31,138,193

Condensed Consolidated Statements of Financial Condition (Unaudited) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Assets
Cash and cash equivalents	$ 202,611	$ 248,022
Restricted cash	769	819
Receivables:
Accounts receivable, net of allowance for doubtful accounts of $596 and $1,149 as of September 30, 2016 and December 31, 2015, respectively	25,583	28,937
Other receivables	9,765	10,333
Total receivables	35,348	39,270
Deferred compensation	9,729	9,040
Investments at fair value (cost basis $33,598 and $38,628 as of September 30, 2016 and December 31, 2015, respectively)	33,506	38,624
Equity method investments	20,309	17,459
Equipment and leasehold improvements, net	9,079	8,698
Deferred tax asset	168,668	165,505
Prepaid expenses and other assets	10,329	12,024
Total assets	490,348	539,461
Liabilities and Equity
Compensation payable	69,650	124,233
Accounts payable and accrued expenses	13,139	21,203
Amount due pursuant to tax receivable agreement	120,774	120,334
Deferred revenue	13,310	7,003
Other liabilities	10,951	9,270
Total liabilities	227,824	282,043
Commitments and Contingencies (See Note 12)
Treasury stock, at cost; 361,748 and 263,622 shares as of September 30, 2016 and December 31, 2015, respectively	(10,237)	(7,616)
Additional paid-in-capital	256,531	190,703
Retained earnings (accumulated deficit)	(37,596)	(15,338)
Accumulated other comprehensive income (loss)	(444)	108
Total Moelis & Company equity	208,774	168,374
Noncontrolling interests	53,750	89,044
Total equity	262,524	257,418
Total liabilities and equity	490,348	539,461
Class A common stock
Liabilities and Equity
Common stock, par value $0.01 per share	209	205
Total equity	209	205
Class B common stock
Liabilities and Equity
Common stock, par value $0.01 per share	311	312
Total equity	$ 311	$ 312

Condensed Consolidated Statements of Financial Condition (Unaudited) (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Accounts receivable, allowance for doubtful accounts	$ 596	$ 1,149
Investments at fair value, cost basis	$ 33,598	$ 38,628
Treasury stock, shares	361,748	263,622
Class A common stock
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	1,000,000,000	1,000,000,000
Common stock, shares issued	20,894,035	20,536,740
Common stock, shares outstanding	20,532,287	20,273,118
Class B common stock
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	1,000,000,000	1,000,000,000
Common stock, shares issued	31,138,193	31,229,236
Common stock, shares outstanding	31,138,193	31,229,236

Condensed Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Revenues	$ 150,676	$ 151,789	$ 408,765	$ 377,074
Expenses
Compensation and benefits	88,046	86,277	240,912	211,333
Occupancy	4,096	3,836	14,941	11,228
Professional fees	2,804	5,116	7,551	12,813
Communication, technology and information services	5,496	4,862	16,101	13,403
Travel and related expenses	4,490	5,951	16,452	16,695
Depreciation and amortization	817	646	2,359	1,954
Other expenses	4,813	5,192	10,885	15,586
Total expenses	110,562	111,880	309,201	283,012
Operating income (loss)	40,114	39,909	99,564	94,062
Other income and (expenses)	187	(456)	391	(474)
Income (loss) from equity method investments	1,562	450	3,897	3,510
Income (loss) before income taxes	41,863	39,903	103,852	97,098
Provision for income taxes	6,550	5,273	16,715	15,652
Net income (loss)	35,313	34,630	87,137	81,446
Net income (loss) attributable to noncontrolling interests	25,824	24,540	63,785	58,889
Net income (loss) attributable to Moelis & Company	9,489	10,090	23,352	22,557
Class A common stock
Expenses
Net income (loss) attributable to Moelis & Company	$ 9,489	$ 10,090	$ 23,352	$ 22,557
Weighted-average shares of Class A common stock outstanding
Basic (in shares)	20,926,745	20,184,835	20,807,189	19,919,675
Diluted (in shares)	24,301,063	21,466,021	23,516,239	21,105,523
Net income (loss) per share attributable to holders of shares of Class A common stock
Basic (in dollars per share)	$ 0.45	$ 0.50	$ 1.12	$ 1.13
Diluted (in dollars per share)	0.39	0.47	0.99	1.07
Dividends declared per share of Class A common stock	$ 0.32	$ 0.30	$ 1.72	$ 0.70

Condensed Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Condensed Consolidated Statements of Comprehensive Income (Unaudited)
Net income	$ 35,313	$ 34,630	$ 87,137	$ 81,446
Unrealized gain (loss) on investments	(148)		(105)
Foreign currency translation adjustment, net of tax	(668)	(1,583)	(1,368)	(17)
Other comprehensive income (loss)	(816)	(1,583)	(1,473)	(17)
Comprehensive income (loss)	34,497	33,047	85,664	81,429
Less: Comprehensive income attributable to noncontrolling interests	25,312	23,546	62,864	58,891
Comprehensive income (loss) attributable to Moelis & Company	$ 9,185	$ 9,501	$ 22,800	$ 22,538

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015
Cash flows from operating activities
Net income (loss)	$ 87,137	$ 81,446
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Bad debt expense	124	668
Depreciation and amortization	2,359	1,954
(Income) loss from equity method investments	(3,897)	(3,510)
Equity-based compensation	56,313	33,337
Deferred tax provision	(1,931)	595
Other	700	484
Changes in assets and liabilities:
Accounts receivable	2,763	(11,913)
Other receivables	1,234	(1,376)
Prepaid expenses and other assets	1,342	(2,397)
Deferred compensation	(841)	(2,863)
Compensation payable	(53,017)	(62,206)
Accounts payable and accrued expenses	(7,664)	(2,233)
Deferred revenue	6,324	1,925
Dividends received	804	2,473
Other liabilities	2,075	540
Net cash provided by (used in) operating activities	93,825	36,924
Cash flows from investing activities
Purchase of investments	(95,919)	(129,984)
Proceeds from sales of investments	101,000	57,000
Return of capital from equity method investments	9	221
Notes issued to employees	(852)
Purchase of equipment and leasehold improvements	(2,737)	(2,902)
Change in restricted cash	(30)	(32)
Net cash provided by (used in) investing activities	1,471	(75,697)
Cash flows from financing activities
Dividends and distributions	(135,751)	(64,394)
Purchase of treasury stock	(2,621)	(7,006)
Excess tax benefits from equity-based compensation	90	449
Class A partnership units and other equity purchased		(90)
Net cash provided by (used in) financing activities	(138,282)	(71,041)
Effect of exchange rate fluctuations on cash and cash equivalents	(2,425)	(294)
Net increase (decrease) in cash and cash equivalents	(45,411)	(110,108)
Cash and cash equivalents, beginning of period	248,022	197,944
Cash and cash equivalents, end of period	202,611	87,836
Cash paid during the period for:
Income taxes	20,609	19,280
Other non-cash activity
Class A Partnership Units or other equity converted into Class A Common Stock	783	4,478
Dividend equivalents issued	$ 10,276	$ 2,732

Condensed Consolidated Statements of Changes in Equity (Unaudited) - USD ($) $ in Thousands	Class A common stock	Class B common stock	Treasury Stock	Additional Paid-In Capital	Retained Earnings (Accumulated Deficit)	Accumulated Other Comprehensive Income (Loss)	Noncontrolling Interests	Total
Balance at beginning of the period at Dec. 31, 2014	$ 198	$ 316		$ 136,896	$ (24,118)	$ 85	$ 61,008	$ 174,385
Balance at beginning of the period (in shares) at Dec. 31, 2014	19,770,893	31,621,542
Changes in Equity
Net income (loss)					22,557		58,889	81,446
Equity-based compensation	$ 1			30,479			2,857	33,337
Equity-based compensation (in shares)	84,841	(5,412)
Other comprehensive income (loss)						(19)	2	(17)
Dividends and distributions				2,732	(16,792)		(50,334)	(64,394)
Treasury Stock purchases			$ (7,006)					$ (7,006)
Treasury Stock purchases (in shares)			(242,619)					(242,619)
Class A Partnership Units and other equity purchased or converted into Class A Common Stock	$ 5	$ (2)		5,112			(727)	$ 4,388
Class A Partnership Units and other equity purchased or converted into Class A Common Stock (in shares)	545,115	(257,401)
Net excess tax benefit (detriment) from equity-based compensation				435				435
Balance at end of the period at Sep. 30, 2015	$ 204	$ 314	$ (7,006)	175,654	(18,353)	66	71,695	222,574
Balance at end of the period (in shares) at Sep. 30, 2015	20,400,849	31,358,729	(242,619)
Balance at beginning of the period at Dec. 31, 2015	$ 205	$ 312	$ (7,616)	190,703	(15,338)	108	89,044	257,418
Balance at beginning of the period (in shares) at Dec. 31, 2015	20,536,740	31,229,236	(263,622)
Changes in Equity
Net income (loss)					23,352		63,785	87,137
Equity-based compensation	$ 3			53,934			2,376	56,313
Equity-based compensation (in shares)	253,757	(2,132)
Other comprehensive income (loss)						(552)	(921)	(1,473)
Dividends and distributions				10,276	(45,610)		(100,417)	(135,751)
Treasury Stock purchases			$ (2,621)					$ (2,621)
Treasury Stock purchases (in shares)			(98,126)					(98,126)
Class A Partnership Units and other equity purchased or converted into Class A Common Stock	$ 1	$ (1)		900			(117)	$ 783
Class A Partnership Units and other equity purchased or converted into Class A Common Stock (in shares)	103,538	(88,911)
Net excess tax benefit (detriment) from equity-based compensation				(48)				(48)
Other				766				766
Balance at end of the period at Sep. 30, 2016	$ 209	$ 311	$ (10,237)	$ 256,531	$ (37,596)	$ (444)	$ 53,750	$ 262,524
Balance at end of the period (in shares) at Sep. 30, 2016	20,894,035	31,138,193	(361,748)

Consolidated and Combined Statements of Changes in Equity (Unaudited) (Parenthetical) - $ / shares	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Class A common stock
Dividends declared per share of Class A common stock	$ 0.32	$ 0.30	$ 1.72	$ 0.70

ORGANIZATION AND BASIS OF PRESENTATION

9 Months Ended

Sep. 30, 2016

ORGANIZATION AND BASIS OF PRESENTATION

ORGANIZATION AND BASIS OF PRESENTATION

1. ORGANIZATION AND BASIS OF PRESENTATION

Moelis & Company and its consolidated subsidiaries (the “Company,” “we,” “our,” or “us”) is a leading global investment bank, incorporated in Delaware. Prior to the Company’s IPO in April 2014, the business operated as a Delaware limited partnership that commenced operations during 2007. Following Moelis & Company’s IPO, the operations are owned by Moelis & Company Group LP (“Group LP”), a U.S. Delaware limited partnership, and Group LP is controlled by Moelis & Company. Moelis & Company’s shareholders are entitled to receive a portion of Group LP’s economics through their direct ownership interests in shares of Class A common stock of Moelis & Company. The noncontrolling interest owners of Group LP (not Moelis & Company) receive economics of the operations primarily through their ownership interests in Group LP partnership units.

The Company’s activities as an investment banking advisory firm constitute a single business segment offering clients, including corporations, governments and financial sponsors, a range of advisory services with expertise across all major industries in mergers and acquisitions, recapitalizations and restructurings and other corporate finance matters.

Basis of Presentation—The condensed consolidated financial statements of Moelis & Company include its partnership interests in Group LP, its equity interest in the sole general partner of Group LP, Moelis & Company Group GP LLC (“Group GP”), and its interests in its subsidiaries. Moelis & Company will operate and control all of the business and affairs of Group LP and its operating entity subsidiaries indirectly through its equity interest in Group GP. The Company operates through the following subsidiaries:

· Moelis & Company LLC (“Moelis U.S.”), a Delaware limited liability company, a registered broker‑dealer with the U.S. Securities and Exchange Commission (“SEC”) and a member of the Financial Industry Regulatory Authority, Inc. (“FINRA”).

· Moelis & Company International Holdings LLC (“Moelis International”), a Delaware limited liability company, owns the following entities:

·

Moelis & Company UK LLP (“Moelis UK”), a limited liability partnership registered under the laws of England and Wales. In addition to the United Kingdom, Moelis UK maintains operations through the following branches:

·

Moelis & Company UK LLP, French Branch (French branch)

·

Moelis & Company Europe Limited, Frankfurt am Main (German branch)

·

Moelis & Company UK LLP, DIFC Branch (Dubai branch)

·

50% of Moelis Australia Holdings PTY Limited (“Moelis Australia Holdings”, or the “Australian JV”), a joint venture with Magic Trust Trustee PTY Limited (the “Trust”).

·

Moelis & Company Asia Limited (“Moelis Asia”), a limited company incorporated in Hong Kong licensed under the Hong Kong Securities and Futures Ordinance to provide financial advisory services. In addition to Hong Kong, Moelis Asia maintains operations in Beijing China through Hong Kong Moelis & Company Asia Limited Beijing Representative Office, as well as having a wholly-owned Chinese subsidiary, Moelis & Company Consulting (Beijing) Company Limited.

·

Moelis & Company India Private Limited, a private limited company incorporated in Mumbai, India.

·

Moelis & Company Assessoria Financeira Ltda. (“Moelis Brazil”), a limited liability company incorporated in São Paulo, Brazil.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

9 Months Ended

Sep. 30, 2016

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Accounting—The Company prepared the accompanying condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). As permitted by the interim reporting rules and regulations set forth by the SEC, the condensed consolidated financial statements presented exclude certain financial information and footnote disclosures normally included in audited financial statements prepared in accordance with U.S. GAAP. In the opinion of the Company’s management, the accompanying unaudited condensed consolidated financial statements contain all adjustments, consisting of normal recurring adjustments, necessary to fairly present the accompanying unaudited condensed consolidated financial statements. These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated and combined audited financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2015.

Consolidation—The Company’s policy is to consolidate (i) entities, other than limited partnerships, in which it has a controlling financial interest, (ii) variable interest entities where the Company has a variable interest and is deemed to be the primary beneficiary and (iii) limited partnerships where the Company has ownership of the majority of voting interests. When the Company does not have a controlling interest in an entity, but exerts significant influence over the entity’s operating and financial decisions, the Company applies the equity method of accounting in which it records in earnings its share of income or losses of the entity. All intercompany balances and transactions with the Company’s subsidiaries have been eliminated in consolidation.

Use of Estimates—The preparation of condensed consolidated financial statements and related disclosures in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Estimates and assumptions are reviewed periodically, and the effects of revisions are reflected in the period in which they are determined to be necessary.

In preparing the condensed consolidated financial statements, management makes estimates and assumptions regarding:

·

the adequacy of the allowance for doubtful accounts;

·

the realization of deferred taxes;

·

the measurement of equity‑based compensation; and

·

other matters that affect the reported amounts and disclosures of contingencies in the financial statements.

Cash and Cash Equivalents—Cash and cash equivalents include all short‑term highly liquid investments that are readily convertible to known amounts of cash and have original maturities of three months or less from the date of purchase.

As of September 30, 2016, the Company had cash equivalents of $154,161 (December 31, 2015: $178,872) invested primarily in government securities money market funds and U.S. Treasury Bills. Additionally, as of September 30, 2016, the Company had cash of $48,450 (December 31, 2015: $69,150) maintained in U.S. and non‑U.S. bank accounts, of which most bank account balances had little or no insurance coverage (most balances are held in U.S. and U.K. accounts which exceeded the U.S. Federal Deposit Insurance Corporation and U.K. Financial Services Compensation Scheme Coverage limits).

Restricted Cash—As of September 30, 2016 and December 31, 2015, the Company held cash of $769 and $819, respectively, in restricted collateral deposits primarily held by certain non-U.S. subsidiaries.

Receivables—The accompanying condensed consolidated statements of financial condition present accounts receivable balances net of allowance for doubtful accounts based on the Company’s assessment of the collectability of customer accounts.

The Company maintains an allowance for doubtful accounts that, in management’s opinion, provides for an adequate reserve to cover losses that may be incurred. The Company regularly reviews the allowance by considering factors such as historical experience, credit quality, age of the accounts receivable, and the current economic conditions that may affect a customer’s ability to pay such amounts owed to the Company.

After concluding that a reserved accounts receivable is no longer collectible, the Company will charge‑off the receivable. This is determined based on several factors including the age of the accounts receivable and the credit worthiness of the customer. This has the effect of reducing both the gross receivable and the allowance for doubtful accounts.

Deferred Compensation—Deferred compensation costs represent arrangements with certain employees whereby cash payments are subject to a required period of service subsequent to payment by the Company. These amounts are charged to expenses over the period that the employee is required to provide services in order to vest in the payment.

Financial Instruments at Fair Value—Fair value is generally based on quoted prices, however if quoted market prices are not available, fair value is determined based on other relevant factors, including dealer price quotations, price activity for equivalent instruments and valuation pricing models. The Company established a fair value hierarchy which prioritizes and ranks the level of market price observability used in measuring financial instruments at fair value. Market price observability is affected by a number of factors, including the type of instrument, the characteristics specific to the instrument and the state of the marketplace (including the existence and transparency of transactions between market participants). Financial instruments with readily‑available actively quoted prices or for which fair value can be measured from actively‑quoted prices in an orderly market will generally have a higher degree of market price observability and a lesser degree of judgment used in measuring fair value.

Financial instruments measured and reported at fair value are classified and disclosed in one of the following categories (from highest to lowest) based on inputs:

Level 1—Quoted prices (unadjusted) are available in active markets for identical instruments that the Company has the ability to access as of the reporting date. The Company, to the extent that it holds such instruments, does not adjust the quoted price for these instruments, even in situations in which the Company holds a large position and a sale could reasonably affect the quoted price.

Level 2—Pricing inputs are observable for the instruments, either directly or indirectly, as of the reporting date, but are not the same as those used in Level 1. Fair value is determined through the use of models or other valuation methodologies.

Level 3—Pricing inputs are unobservable for the instruments and include situations where there is little, if any, market activity for the investments. The inputs into the determination of fair value require significant judgment or estimation by the Company’s management.

In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the determination of which category within the fair value hierarchy is appropriate for any given investment is based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the instrument.

For level 3 investments in which pricing inputs are unobservable and limited market activity exists, management’s determination of fair value is based on the best information available, may incorporate management’s own assumptions and involves a significant degree of judgment.

Equity Method Investments—The Company accounts for its equity method investments under the equity method of accounting as the Company does not control these entities but has the ability to exercise significant influence. The amounts recorded on the condensed consolidated financial statements of financial condition reflects the Company’s share of contributions made to, distributions received from, and the equity earnings and losses of, the investments. The Company reflects its share of gains and losses of the investment in income (loss) from equity method investments in the condensed consolidated statements of operations.

Equipment and Leasehold Improvements—Office equipment and furniture and fixtures are stated at cost less accumulated depreciation, which is determined using the straight‑line method over the estimated useful lives of the assets, ranging from three to seven years, respectively. Leasehold improvements are stated at cost less accumulated amortization, which is determined using the straight‑line method over the lesser of the term of the lease or the estimated useful life of the asset.

Major renewals and improvements are capitalized and minor replacements, maintenance and repairs are charged to expenses as incurred. Upon retirement or disposal of assets, the cost and related accumulated depreciation or amortization are removed from the condensed consolidated statements of financial condition and any gain or loss is reflected in the condensed consolidated statements of operations.

Deferred Tax Asset and Amount Due Pursuant to Tax Receivable Agreement—In conjunction with the IPO, the Company was treated for U.S. federal income tax purposes as having directly purchased Class A partnership units in Group LP from the existing unitholders. Additional Group LP Class A partnership units may be exchanged for shares of Class A common stock in the Company. The initial purchase and future exchanges are expected to result in an increase in the tax basis of Group LP’s assets attributable to the Company’s interest in Group LP. These increases in the tax basis of Group LP’s assets attributable to the Company’s interest in Group LP would not have been available but for the initial purchase and future exchanges. Such increases in tax basis are likely to increase (for tax purposes) depreciation and amortization deductions and therefore reduce the amount of income tax the Company would otherwise be required to pay in the future. As a result, the Company records a deferred tax asset for such increase in tax basis.

The Company has entered into a tax receivable agreement with its eligible Managing Directors that will provide for the payment by the Company to its eligible Managing Directors of 85% of the amount of cash savings, if any, in U.S. federal, state and local income tax or franchise tax that the Company actually realizes as a result of (a) the increases in tax basis attributable to exchanges by its eligible Managing Directors and (b) tax benefits related to imputed interest deemed to be paid by the Company as a result of this tax receivable agreement. The Company expects to benefit from the remaining 15% of cash savings, if any, in income tax that it realizes and record any such estimated tax benefits as an increase to additional paid-in-capital. For purposes of the tax receivable agreement, cash savings in income tax will be computed by comparing the Company’s actual income tax liability to the amount of such taxes that it would have been required to pay had there been no increase to the tax basis of the tangible and intangible assets of Group LP as a result of the exchanges and had it not entered into the tax receivable agreement. The term of the tax receivable agreement commenced upon consummation of the IPO and will continue until all such tax benefits have been utilized or expired, unless the Company exercises its right to terminate the tax receivable agreement for an amount based on an agreed value of payments remaining to be made under the agreement. The Company has recorded the estimated tax benefits related to the increase in tax basis and imputed interest as a result of the initial purchase and subsequent exchanges described above as a deferred tax asset in the condensed consolidated statements of financial condition. The amount due to its eligible Managing Directors related to the tax receivable agreement as a result of the initial purchase and subsequent exchanges described above is recorded as amount due pursuant to tax receivable agreement in the condensed consolidated statements of financial condition. The amounts recorded for the deferred tax asset and the liability for our obligations under the tax receivable agreement are estimates. Any adjustments to our estimates subsequent to their initial establishment will be included in net income (loss). Future exchanges of Class A partnership units in Group LP for Class A common shares in the Company will be accounted for in a similar manner.

Revenue and Expense Recognition—The Company recognizes revenues from providing advisory services when earned and collection is reasonably assured. Upfront fees are recognized over the estimated period that the related services are performed. Transaction‑related fees are recognized when all services for a transaction have been provided, specified conditions have been met and the transaction closes. Underwriting revenues are recognized when the offering is deemed complete and is presented net of related expenses. Deferred revenues are recorded for fees received that have not yet been earned. Expenses are reflected on the condensed consolidated statements of operations, net of client reimbursements. Reimbursable expenses billed to clients totaled $4,051 and $3,639 for the three months ended September 30, 2016 and 2015, respectively, and $11,445 and $9,510 for the nine months ended September 30, 2016 and 2015, respectively.

Equity‑based Compensation—The Company recognizes the cost of employee services received in exchange for an equity instrument award. The cost is based on its grant-date fair value based on quoted market prices at the time of grant amortized over the service period required by the award’s vesting terms. The Company records as treasury stock shares repurchased from its employees for the purpose of settling tax liabilities incurred upon the vesting of restricted stock units (“RSUs”). The Company records dividends in kind, net of forfeitures, on outstanding RSUs as a dividend payment and a charge to equity. Dividends in kind on RSUs are subject to the same vesting conditions as the underlying RSUs on which they were accrued. Dividends in kind will be forfeited if the award does not vest.

For the purposes of calculating diluted net income (loss) per share to holders of Class A common stock, unvested service‑based awards are included in the diluted weighted average shares of Class A common stock outstanding using the treasury stock method. See Note 7 for further discussion.

The Company generally permits a retiring employee to retain and not forfeit certain qualifying incentive RSUs granted during employment if at retirement the employee (i) is at least 54 years old and (ii) has provided at least 8 consecutive years of service to the Company. Any such RSUs will continue to vest on their applicable vesting schedule, subject to noncompetition and other terms. Over time a greater number of employees may become retirement eligible and the related requisite service period over which we will expense these awards will be shorter than the stated vesting period. Any unvested RSUs prior to meeting the stated requisite service period or retirement eligibility date are eligible to receive dividends in kind; however, the right to dividends in kind will be forfeited if the underlying award does not vest.

Income Taxes—The Company accounts for income taxes in accordance with ASC 740, “Accounting for Income Taxes” (“ASC 740”), which requires the recognition of tax benefits or expenses on temporary differences between the financial reporting and tax bases of its assets and liabilities by applying the enacted tax rates in effect for the year in which the differences are expected to reverse. Such net tax effects on temporary differences are reflected on the Company’s condensed consolidated statements of financial condition as deferred tax assets and liabilities. Deferred tax assets are reduced by a valuation allowance when the Company believes that it is more‑likely‑than‑not that some portion or all of the deferred tax assets will not be realized.

ASC 740‑10 prescribes a two‑step approach for the recognition and measurement of tax benefits associated with the positions taken or expected to be taken in a tax return that affect amounts reported in the financial statements. The Company has reviewed and will continue to review the conclusions reached regarding uncertain tax positions, which may be subject to review and adjustment at a later date based on ongoing analyses of tax laws, regulations and interpretations thereof. For the three and nine months ended September 30, 2016 and 2015, no unrecognized tax benefit was recorded. To the extent that the Company’s assessment of the conclusions reached regarding uncertain tax positions changes as a result of the evaluation of new information, such change in estimate will be recorded in the period in which such determination is made. The Company reports income tax‑related interest and penalties relating to uncertain tax positions, if applicable, as a component of income tax expense. For the three and nine months ended September 30, 2016 and 2015, no such amounts were recorded.

Foreign Currency Translation—Assets and liabilities held in non‑U.S. dollar denominated (functional) currencies are translated into U.S. dollars at exchange rates in effect at the end of the reporting period. Revenues and expenses are translated at average exchange rates during the reporting period. A charge or credit is recorded to other comprehensive income to reflect the translation of these amounts to the extent the non‑U.S. currency is designated the functional currency of the subsidiary. Non‑functional currency related transaction gains and losses are immediately recorded in the condensed consolidated statements of operations.

RECENT ACCOUNTING PRONOUNCEMENTS	9 Months Ended
RECENT ACCOUNTING PRONOUNCEMENTS	Sep. 30, 2016
RECENT ACCOUNTING PRONOUNCEMENTS
RECENT ACCOUNTING PRONOUNCEMENTS	3. RECENT ACCOUNTING PRONOUNCEMENTS In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers” (“ASU 2014-09”). ASU 2014-09 requires a company to recognize revenue in an amount that reflects the consideration to which the entity expects to be entitled in exchange for services provided. The amendment requires enhanced disclosures regarding the nature, amount, timing and uncertainty of revenues and cash flows from contracts with customers. In August 2015, the FASB issued ASU No. 2015-14, “Deferral of the Effective Date” (“ASU 2015-14”), which provides amendments that defer the effective date of ASU 2014-09 by one year. In March and April 2016, the FASB issued ASU No. 2016-08 and ASU No. 2016-10, respectively, both entitled, “Revenue from Contracts with Customers”. The amendments provide clarification on the implementation guidance for principal versus agent considerations and for identifying performance obligations and licensing in Topic 606, but the updates do not change the core principles of the codification. Similarly, in May 2016 the FASB issued ASU 2016-12 to modify narrow aspects of Topic 606, but not the core principles. The amendments in these updates are effective either retrospectively to each prior reporting period presented, or as a cumulative-effect adjustment as of the date of adoption, during interim and annual periods beginning after December 15, 2017, with early adoption permitted beginning after December 15, 2016. The Company is currently assessing the impact the adoption of ASU 2014-09 will have on its condensed consolidated financial statements. In January 2016, the FASB issued ASU No. 2016-01, “Financial Instruments—Overall: Recognition and Measurement of Financial Assets and Financial Liabilities” (“ASU 2016-01”). ASU 2016-01 enhances the reporting model for financial instruments by addressing certain aspects of the recognition, measurement, presentation and disclosure of financial instruments. Key provisions require equity investments with readily determinable fair values (except those accounted for under the equity method of accounting) to be measured at fair value with changes in fair value recognized in net income. In addition, the exit price notion must be used when measuring the fair value of financial instruments for disclosure purposes. ASU 2016-01 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017. The Company is currently assessing the impact the adoption of ASU 2016-01 will have on its condensed consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, “Leases” (“ASU 2016-02”). ASU 2016-02 increases the transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The amendments will retain lease classifications, distinguishing finance leases from operating leases, using criteria that is substantially similar for distinguishing capital leases from operating leases in previous guidance. Lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. ASU 2016-02 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted. The Company is currently assessing the impact the adoption of ASU 2016-02 will have on its condensed consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-07, “Investments—Equity Method and Joint Ventures” (“ASU 2016-07”). ASU 2016-07 simplifies the accounting for investments that become qualified for the equity method of accounting as a result of an increase in the level of ownership or degree of influence by eliminating the requirement of adjusting the investment, results of operations and retained earnings retroactively as if the equity method had been in effect during all previous periods. ASU 2016-07 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016. Early adoption is permitted. The adoption of ASU 2016-07 will not have a material impact on the Company’s condensed consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-09, “Compensation—Stock Compensation” (“ASU 2016-09”). ASU 2016-09 simplifies the accounting for share-based payment awards to employees. The amendments in the update affect several aspects of Topic 718, including income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. ASU 2016-09 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016. Early adoption is permitted. The Company is currently assessing the impact the adoption of ASU 2016-09 will have on its condensed consolidated financial statements. In August 2016, the FASB issues ASU No. 2016-15, “Statement of Cash Flows—Classification of Certain Cash Receipts and Cash and Cash Payments” (“ASU 2016-15”). ASU 2016-15 provides more standardized guidance to improve consistency surrounding the classification of certain cash payments and receipts between the operating, investing, and financing sections of the statement of cash flows. These transactions include the settlement of certain debt instruments, distributions received from equity-method investees and other transactions. ASU 2016-15 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017. Early adoption is permitted. The Company is currently assessing the impact the adoption of ASU 2016-15 will have on its condensed consolidation financial statements. In October 2016, the FASB issued ASU No. 2016-16, “Income Taxes—Intra-Entity Transfers of Assets Other Than Inventory” (“ASU 2016-16”). ASU 2016-16 provides clearer guidance related to current and deferred income taxes driven by intra-entity asset transfers. Specifically, this ASU states that an entity should recognize the income tax consequences of intra-entity transfers of assets other than inventory when they occur whereas in the past, certain entities did not recognize these impacts until the asset was sold to a third party. ASU 2016-16 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017. Early adoption is permitted. The Company is currently assessing the impact the adoption of ASU 2016-16 will have on its condensed consolidation financial statements.

- Definition

The entire disclosure of changes in accounting principles, including adoption of new accounting pronouncements, that describes the new methods, amount and effects on financial statement line items.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Change in Accounting Principle
-URI http://asc.fasb.org/extlink&oid=6507316

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Direct Effects of a Change in Accounting Principle
-URI http://asc.fasb.org/extlink&oid=66092750

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=64853466&loc=d3e22583-107794

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Indirect Effects of a Change in Accounting Principle
-URI http://asc.fasb.org/extlink&oid=6515603

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=64853466&loc=d3e22580-107794

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 270
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.10-01.(b)(6))
-URI http://asc.fasb.org/extlink&oid=27015980&loc=d3e46468-122699

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Accounting Change
-URI http://asc.fasb.org/extlink&oid=6503790

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=64853466&loc=d3e22499-107794

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Retrospective Application
-URI http://asc.fasb.org/extlink&oid=6523989

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 270
-SubTopic 10
-Section 45
-Paragraph 13
-URI http://asc.fasb.org/extlink&oid=68064558&loc=d3e765-108305

Reference 11: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 270
-SubTopic 10
-Section 45
-Paragraph 12
-URI http://asc.fasb.org/extlink&oid=68064558&loc=d3e725-108305

+ Details

EQUITY METHOD INVESTMENTS	9 Months Ended
EQUITY METHOD INVESTMENTS	Sep. 30, 2016
EQUITY METHOD INVESTMENTS.
EQUITY METHOD INVESTMENTS	4. EQUITY METHOD INVESTMENTS Investment in Joint Venture On April 1, 2010, the Company entered into a 50‑50 joint venture in Moelis Australia Holdings, investing a combination of cash and certain net assets of its wholly‑owned subsidiary, Moelis Australia, in exchange for its interests. The remaining 50% is owned by an Australian trust established by and for the benefit of Moelis Australia senior executives. For the three months ended September 30, 2016 and 2015, income of $1,571 and $163 was recorded on this investment, respectively, and for the nine months ended September 30, 2016 and 2015, income of $2,176 and $442 was recorded on this investment, respectively. Other Equity Method Investment In June 2014, the Company made an investment of $265 into a general partner entity which invests third-party funds and is controlled by a related party, Moelis Asset Management LP. The Company has determined that it should account for this investment as an equity method investment on its condensed consolidated financial statements. For the three months ended September 30, 2016 and 2015, a loss of $9 and income of $287 was recorded on this investment, respectively, and for the nine months ended September 30, 2016 and 2015, $1,721 and $3,068 of income was recorded on this investment, respectively. During the nine months ended September 30, 2016 and 2015, the Company received cash distributions from this entity in the amount of $813 and $2,694, respectively.

EQUIPMENT AND LEASEHOLD IMPROVEMENTS

9 Months Ended

Sep. 30, 2016

EQUIPMENT AND LEASEHOLD IMPROVEMENTS

EQUIPMENT AND LEASEHOLD IMPROVEMENTS

5. EQUIPMENT AND LEASEHOLD IMPROVEMENTS

Equipment and leasehold improvements, net consist of the following:


	September 30,		December 31,
	2016		2015
Office equipment	$	12,449	$	11,193
Furniture and fixtures		3,259		2,916
Leasehold improvements		8,049		7,073
Total		23,757		21,182
Less accumulated depreciation and amortization		(14,678)		(12,484)
Equipment and leasehold improvements, net	$	9,079	$	8,698

Depreciation and amortization expenses for fixed assets totaled $817 and $646 for the three months ended September 30, 2016 and 2015, respectively, and $2,359 and $1,954 for the nine months ended September 30, 2016 and 2015, respectively.

FAIR VALUE MEASUREMENTS

9 Months Ended

Sep. 30, 2016

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS

6. FAIR VALUE MEASUREMENTS

The Company established a fair value hierarchy which prioritizes and ranks the level of market price observability used in measuring investments at fair value. Financial instruments measured and reported at fair value are classified and disclosed in one of the following categories (from highest to lowest) based on inputs:

Level 1—Quoted prices (unadjusted) are available in active markets for identical instruments that the Company has the ability to access as of the reporting date. The Company, to the extent that it holds such instruments, does not adjust the quoted price for these instruments, even in situations in which the Company holds a large position and a sale could reasonably affect the quoted price.

Level 2—Pricing inputs are observable for the instruments, either directly or indirectly, as of the reporting date, but are not the same as those used in level 1. Fair value is determined through the use of models or other valuation methodologies.

Level 3—Pricing inputs are unobservable for the instruments and include situations in which there is little, if any, market activity for the investments. The inputs into the determination of fair value require significant judgment or estimation by the Company’s management.

The estimated fair values of government securities money markets and U.S. Treasury Bills as of September 30, 2016 and December 31, 2015 are based on quoted prices for recent trading activity in identical or similar instruments. The Company generally invests in U.S. Treasury Bills with maturities of less than twelve months. See Note 2 for further information on the Company’s fair value hierarchy.

In 2015 the Company received convertible notes as compensation for its services and classified this investment as available-for-sale. The convertible notes did not have readily determinable market values and were categorized accordingly as level 3. The fair value of the convertible notes was recorded at the initial transaction price at which such notes were purchased by third party investors in the capital market transaction on which the Company provided services. In July 2016, the issuer of the convertible notes consummated its initial public offering and the notes converted into common stock of the issuer at a discounted conversion rate equal to the principal value of the notes plus accrued interest. The common stock is classified as available-for-sale and the subsequent measurement of its fair value is recorded based upon the quoted price in its active market. Unrealized changes in fair value are reflected in other comprehensive income in the condensed consolidated financial statements.

The following table summarizes the levels of the fair value hierarchy into which the Company’s financial assets fall as of September 30, 2016:


	Total		Level 1		Level 2		Level 3
Financial assets:
Included in cash and cash equivalents
U.S. treasury bills	$	112,485	$	42,487	$	69,998	$	—
Government securities money market		41,676		—		41,676		—
Investments
U.S. treasury bills		32,976		—		32,976		—
Common stock		530		530		—		—
Total financial assets	$	187,667	$	43,017	$	144,650	$	—

The following table summarizes the levels of the fair value hierarchy into which the Company’s financial assets fall as of December 31, 2015:


	Total		Level 1		Level 2		Level 3
Financial assets:
Included in cash and cash equivalents
U.S. treasury bills	$	100,996	$	71,998	$	28,998	$	—
Government securities money market		77,876		—		77,876		—
Investments
U.S. treasury bills		37,989		19,990		17,999		—
Convertible notes		635		—		—		635
Total financial assets	$	217,496	$	91,988	$	124,873	$	635

The Company’s methodology for reclassifications impacting the fair value hierarchy is that transfers in/out of the respective category are reported at fair value as of the beginning of the period in which the reclassification occurred. The changes to the Company’s investment classified as level 3 are as follows for the nine months ended September 30, 2016.


	Convertible notes
January 1, 2016	$	635
Unrealized gains (losses) included in accumulated other comprehensive income		22
March 31, 2016		657
Unrealized gains (losses) included in accumulated other comprehensive income		21
June 30, 2016		678
Transfer out of level 3 due to conversion of convertible notes to common stock		(678)
September 30, 2016	$	—

During the nine months ended September 30, 2016, convertible notes held by the Company which were classified as level 3 were converted into common stock due to the occurrence of an initial public offering described above. As a result, the convertible notes classified as level 3 were converted to common stock classified as level 1.

At the end of the reporting period, the Company reviews U.S. treasury bills held to determine whether the securities are of the most recent issuance of that security with the same maturity (referred to as “on-the-run”, which is the most liquid version of the maturity band). If a U.S. treasury bill held at the end of the reporting period was from the most recent issuance it is classified as level 1, otherwise it is referred to as “off-the-run” and is classified as level 2. During the three and nine months ended September 30, 2016, there were transfers of $7,984 from level 1 to level 2 related to U.S. treasury bills that were initially acquired as on-the-run and classified as level 1, but subsequently transferred to level 2 as a result of becoming off-the-run. There were no transfers between level 1, level 2 or level 3 during the three or nine months ended September 30, 2015.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

NET INCOME (LOSS) PER SHARE ATTRIBUTABLE TO CLASS A COMMON SHAREHOLDERS

9 Months Ended

Sep. 30, 2016

NET INCOME (LOSS) PER SHARE ATTRIBUTABLE TO CLASS A COMMON SHAREHOLDERS

NET INCOME (LOSS) PER SHARE ATTRIBUTABLE TO CLASS A COMMON SHAREHOLDERS

7. NET INCOME (LOSS) PER SHARE ATTRIBUTABLE TO CLASS A COMMON SHAREHOLDERS

The calculations of basic and diluted net income (loss) per share attributable to holders of shares of Class A common stock for the three and nine months ended September 30, 2016 and 2015 are presented below.


	Three Months Ended September 30,						Nine Months Ended September 30,
(dollars in thousands, except per share amounts)	2016			2015			2016			2015
Numerator:
Net income (loss) attributable to holders of shares of Class A common stock—basic	$	9,489		$	10,090		$	23,352		$	22,557
Add (deduct) dilutive effect of:
Noncontrolling interests related to Class A partnership units			(a)			(a)			(a)			(a)
Net income (loss) attributable to holders of shares of Class A common stock—diluted	$	9,489		$	10,090		$	23,352		$	22,557
Denominator:
Weighted average shares of Class A common stock outstanding—basic		20,926,745			20,184,835			20,807,189			19,919,675
Add (deduct) dilutive effect of:
Noncontrolling interests related to Class A partnership units			(a)			(a)			(a)			(a)
Weighted average number of incremental shares issuable from unvested restricted stock, RSUs and stock options, as calculated using the treasury stock method		3,374,318	(b)		1,281,186	(b)		2,709,050	(b)		1,185,848	(b)
Weighted average shares of Class A common stock outstanding—diluted		24,301,063			21,466,021			23,516,239			21,105,523
Net income (loss) per share attributable to holders of shares of Class A common stock
Basic	$	0.45		$	0.50		$	1.12		$	1.13
Diluted	$	0.39		$	0.47		$	0.99		$	1.07

We have not included the impact of Class B common stock because these shares are entitled to an insignificant amount of economic participation.

(a)Class A partnership units may be exchanged for Moelis & Company Class A common stock on a one‑for‑one basis, subject to applicable lock‑up, vesting and transfer restrictions. If all Class A partnership units were to be exchanged for Class A common stock, fully diluted Class A common stock outstanding would be 58,000,602 and 55,398,692 for the three months ended September 30, 2016 and 2015, respectively, and 57,335,334 and 55,303,354 for the nine months ended September 30, 2016 and 2015, respectively. In computing the dilutive effect, if any, that the aforementioned exchange would have on net income (loss) per share, net income (loss) available to holders of Class A common stock would be adjusted due to the elimination of the noncontrolling interests in consolidated entities associated with the Group LP Class A partnership units (including any tax impact). For the three and nine months ended September 30, 2016 and 2015, such exchange is not reflected in diluted net income (loss) per share as the assumed exchange is not dilutive.

(b)During the three and nine months ended September 30, 2016 and 2015, certain shares of Moelis & Company’s Class A common stock assumed to be issued pursuant to certain RSUs as calculated using the treasury stock method were antidilutive and therefore have been excluded from the calculation of diluted net income (loss) per share attributable to Moelis & Company. During the three months ended September 30, 2016 and 2015, the additional weighted average amount of RSUs that would have been included in this calculation if the effect were dilutive would have been 2,552 and 15,397 units, respectively, and 1,211 and 7,945 units for the nine months ended September 30, 2016 and 2015, respectively. Additionally, during the three months ended September 30, 2016 and 2015, the additional weighted average amount of options that would have been included in this calculation if the effect were dilutive would have been 973,859 and 1,049,977, respectively, and 1,048,196 and 0 weighted average options for the nine months ended September 30, 2016 and 2015, respectively.

EQUITY-BASED COMPENSATION

9 Months Ended

Sep. 30, 2016

EQUITY-BASED COMPENSATION

EQUITY-BASED COMPENSATION

8. EQUITY‑BASED COMPENSATION

Partnership Units

Prior to the Company’s restructuring and IPO, the business operated as a partnership and its ownership structure was comprised of common partners (principally outside investors) holding units and employees holding units. The common partners contributed capital to the partnership and were not subject to vesting. Units granted to Managing Directors upon joining the Company and as part of annual incentive compensation generally vested based on service over five to eight years. Certain non‑Managing Director employees were granted units as part of their incentive arrangements and these units generally vest based on service ratably over four years. In connection with the Company’s restructuring and IPO, substantially all of the Managing Director partner equity subject to vesting had been accelerated. Units granted to non‑Managing Director employees were not accelerated in connection with the Company’s restructuring and IPO and continue to vest based on the original terms of the grant.

In connection with the reorganization and IPO, Group LP issued Class A partnership units to Moelis & Company and to certain existing unit holders. Following the reorganization, a Group LP Class A partnership unit (not held by Moelis & Company or its subsidiaries) is exchangeable into one share of Moelis & Company Class A common stock and represents the Company’s noncontrolling interests. As of September 30, 2016, partners held 33,698,300 Group LP partnership units, 578,171 of which were unvested and will continue to vest over their service life.

In relation to the vesting of units, the Company recognized compensation expenses of $743 and $945 for the three months ended September 30, 2016 and 2015, respectively, and expenses of $2,376 and $2,857 for the nine months ended September 30, 2016 and 2015, respectively. As of September 30, 2016, there was $3,974 of unrecognized compensation expense related to unvested Class A partnership units which is expected to be recognized over a weighted-average period of 1.7 years, using the graded vesting method.

2014 Omnibus Incentive Plan

In connection with the IPO, the Company adopted the Moelis & Company 2014 Omnibus Incentive Plan (the “Plan”) to provide additional incentives to selected officers, employees, Managing Directors, non‑employee directors, independent contractors, partners, senior advisors and consultants. The Plan provides for the issuance of incentive stock options (“ISOs”), nonqualified stock options, stock appreciation rights (“SARs”), restricted stock, RSUs, stock bonuses, other stock‑based awards and cash awards.

In the first quarter of 2015, the Board of Directors authorized the repurchase of up to $25 million of shares of Class A common stock of the Company and/or Class A partnership units of Group LP with no expiration date. Under this share repurchase program, shares may be repurchased from time to time in open market transactions, in privately negotiated transactions or otherwise. The timing and the actual number of shares repurchased will be opportunistic and measured in nature and will depend on a variety of factors, including price and market conditions. As of September 30, 2016, approximately $20 million of shares remain that may yet be purchased under the program.

Restricted Stock and Restricted Stock Units (RSUs)

Pursuant to the Plan and in connection with the Company’s annual compensation process and ongoing hiring process, the Company issues RSUs which generally vest over a service life of four to five years. For the three months ended September 30, 2016 and 2015, the Company recognized expenses of $16,439 and $10,826 respectively, and expenses of $51,233 and $27,398 for the nine months ended September 30, 2016 and 2015, respectively, in relation to the vesting of RSUs.

The following table summarizes activity related to restricted stock and RSUs for the nine months ended September 30, 2016 and 2015.


	Restricted Stock & RSUs
	2016			2015
		Weighted Average			Weighted Average
	Number of	Grant Date		Number of	Grant Date
	Shares	Fair Value		Shares	Fair Value
Unvested Balance at January 1,	5,123,481	$	28.67	2,473,624	$	25.86
Granted	3,787,723		24.09	2,615,660		31.92
Forfeited	(74,739)		26.05	(36,903)		28.79
Vested	(586,953)		28.30	(92,717)		27.45
Unvested Balance at September 30,	8,249,512	$	26.81	4,959,664	$	28.93

As of September 30, 2016, the total compensation expense related to unvested restricted stock and RSUs not yet recognized was $103,327. The Company assumes a forfeiture rate of 3% annually based on expected turnover and periodically reassesses this rate. The weighted‑average period over which this compensation expense is expected to be recognized at September 30, 2016 is 2.0 years.

Stock Options

Pursuant to the Plan, the Company issued 3,501,881 stock options in 2014 which vest over a five‑year period. The Company estimated the fair value of stock option awards at grant using the Black‑Scholes valuation model with the following assumptions:


	Assumptions
Expected life (in years)		6
Weighted-average risk free interest rate		1.91	%
Expected volatility		35	%
Dividend yield		2.72	%
Weighted-average fair value at grant date	$	6.70

On November 24, 2014 and March 4, 2016 the Company paid special dividends of $1.00 and $0.80 per share, respectively. As required under Section 5 of the Company’s 2014 Omnibus Incentive Plan, the Compensation Committee of the Company’s Board of Directors equitably reduced the exercise price of the Company’s outstanding options to purchase common stock by $1.80 from $25.00 per share to $23.20 per share.

The following table summarizes activity related to stock options for the nine months ended September 30, 2016 and 2015.


	Stock Options Outstanding
	2016			2015
		Weighted-Average			Weighted-Average
	Number	Exercise Price		Number	Exercise Price
	Outstanding	Per Share		Outstanding	Per Share
Outstanding at January 1,	3,081,203	$	23.20	3,296,906	$	24.00
Grants	—		—	—		—
Exercises	—		—	—		—
Forfeiture or expirations	(208,975)		23.20	(174,727)		24.00
Outstanding at September 30,	2,872,228	$	23.20	3,122,179	$	24.00

For the three months ended September 30, 2016 and 2015, the Company recognized expenses of $426 and $1,048, respectively, and expenses of $2,704 and $3,082 for the nine months ended September 30, 2016 and 2015, respectively, in relation to these stock options. As of September 30, 2016, the total compensation expense related to unvested stock options not yet recognized was $6,954. The Company assumes a forfeiture rate of 3% annually based on expected turnover and periodically reassesses this rate. This compensation expense is expected to be recognized over a weighted‑average period of 2.1 years.

- Definition

The entire disclosure for compensation-related costs for equity-based compensation, which may include disclosure of policies, compensation plan details, allocation of equity compensation, incentive distributions, equity-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details.

+ References + Details

STOCKHOLDERS EQUITY

9 Months Ended

Sep. 30, 2016

STOCKHOLDERS EQUITY

STOCKHOLDERS EQUITY

9. STOCKHOLDERS EQUITY

Class A Common Stock

IPO and Reorganization

In April 2014, the Company issued 15,263,653 shares of Class A common stock as follows:

·

7,699,851 shares in connection with the reorganization;

·

7,475,000 shares in connection with the IPO; and

·

88,802 shares in connection with the settlement of appreciation rights issued in prior years.

Secondary Offering

In November 2014, the Company completed a secondary offering of 6,325,000 shares of Class A common stock in order to facilitate organized liquidity and increase the public float of its Class A common stock. In connection with the offering, the shares of Class A common stock outstanding of the Company increased by 4,511,058 shares as a result of the Company acquiring additional Class A partnership units in Group LP. The Company did not retain any proceeds from the secondary offering.

As of September 30, 2016, 20,894,035 shares of Class A common stock were issued and 20,532,287 shares were outstanding. As of December 31, 2015, 20,536,740 shares of Class A common stock were issued and 20,273,118 shares were outstanding, due primarily to the IPO and secondary offering transactions described above.

Class B Common Stock

IPO and Reorganization

In conjunction with Moelis & Company’s IPO of its Class A common stock, the Company issued 36,158,698 shares of Class B common stock. Moelis & Company Partner Holdings LP (“Partner Holdings”) holds all shares of Class B common stock, enabling it initially to exercise majority voting control over the Company. The economic rights of Class B common stock are based on the ratio of the Class B subscription price to the initial public offering price of shares of Class A common stock (.00055 to 1), and the aggregate number of shares of Class B common stock may be converted to Class A common stock (up to a maximum of 20,000 shares). Holders of shares of Class B common stock are entitled to receive dividends of the same type as any dividends payable on outstanding shares of Class A common stock at a ratio of .00055 to 1.

Secondary Offering

In connection with the secondary offering in November 2014, Partner Holdings surrendered 2,998,322 shares of Class B common stock and was issued 1,658 shares of Class A common stock at a conversion ratio of .00055 to 1. The Company also purchased 1,509,131 shares of Class B common stock from Partner Holdings for cash of $28 and subsequently cancelled those shares. The Company did not retain any proceeds from the secondary offering.

As of September 30, 2016 and December 31, 2015, 31,138,193 and 31,229,236 shares of Class B common stock were issued and outstanding, respectively, due primarily to the IPO and secondary offering transactions described above.

Treasury Stock

During the nine months ended September 30, 2016 and 2015, the Company repurchased 98,126 and 242,619 shares, respectively, pursuant to the Company’s share repurchase program and shares repurchased from its employees for the purpose of settling tax liabilities incurred upon the vesting of RSUs. The result of the repurchases was an increase of $2,621 and $7,006, respectively, in the treasury stock balance on the Company’s condensed consolidated statement of financial condition as of September 30, 2016 and December 31, 2015.

Noncontrolling Interests

A Group LP Class A partnership unit (not held by Moelis & Company or its subsidiaries) is exchangeable into one share of Moelis & Company Class A common stock and represents the Company’s noncontrolling interests (non-redeemable). As of September 30, 2016 and December 31, 2015, partners held 33,698,300 and 33,803,921 Group LP partnership units, respectively, representing a 62% and 63% noncontrolling interest in Moelis & Company, respectively.

Moelis & Company operates and controls all of the business and affairs of Group LP and its operating entity subsidiaries indirectly through its equity interest in Group GP, and thus the 20,532,287 shares of Class A common stock outstanding at September 30, 2016 represents the controlling interest.

- Definition

The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.

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+ Details

RELATED-PARTY TRANSACTIONS	9 Months Ended
RELATED-PARTY TRANSACTIONS	Sep. 30, 2016
RELATED-PARTY TRANSACTIONS
RELATED-PARTY TRANSACTIONS	10. RELATED‑PARTY TRANSACTIONS Aircraft Lease—On August 30, 2014, a related party, Moelis & Company Manager LLC ("Manager"), acquired an aircraft with funds received solely from its managing member (Mr. Moelis). The aircraft is used and operated by the Company pursuant to a dry lease with Manager which terminates on December 31, 2019. The terms of the dry lease are comparable to the market rates of leasing from an independent third party. Pursuant to this dry lease arrangement, the lessee is obligated to bear its share of the costs of operating the aircraft. For each of the three months ended September 30, 2016 and 2015, the Company incurred $312 in aircraft lease costs to be paid to Manager, respectively, and $936 in aircraft costs for each of the nine months ended September 30, 2016 and 2015, respectively. In addition, there are two other lessees of the aircraft; one of whom is Mr. Moelis and the other is Moelis Asset Management LP. These lessees share the lease, operating and related costs of the plane in proportion to their respective use pursuant to a cost sharing and operating agreement. Promissory Notes—As of September 30, 2016, there were $937 of unsecured promissory notes from employees held by the Company (December 31, 2015: $119). Any outstanding balances are reflected in other receivables on the condensed consolidated statements of financial condition. The notes held as of September 30, 2016 and December 31, 2015 bear a fixed interest rate of 4.00%. During each of the nine months ended September 30, 2016 and 2015, the Company received $0 of principal repayments and recognized interest income of $15 and $4, respectively, on such notes, which is included in other income and expenses on the condensed consolidated statements of operations. Services Agreement—In connection with the Company’s IPO, the Company entered into a services agreement with a related party, Moelis Asset Management LP, whereby the Company provides certain administrative services, technology, and office space to Moelis Asset Management LP for a fee. This fee totaled $285 and $420 for the three months ended September 30, 2016 and 2015, respectively, and $996 and $1,265 for the nine months ended September 30, 2016 and 2015, respectively. The amount of the fee is based upon the estimated usage and related expense of all shared services between the Company and Moelis Asset Management LP during the relevant period, and will be assessed periodically by Management as per the terms of the agreement. As of September 30, 2016 and December 31, 2015, the Company had balances due from Moelis Asset Management LP of $0 and $3, respectively. Joint Venture—As of September 30, 2016 and December 31, 2015, the Company had a net balance due from the Australian JV of $1,035 and a net balance due to the Australian JV of $167, respectively, which are reflected in other receivables on the condensed consolidated statements of financial condition. These balances consist of amounts due from the Australian JV for advisory services performed and billable expenses incurred on behalf of the Company during the period, offset by expenses paid by the Company on behalf of the Australian JV. The relationship between the Company and the Australian JV is governed by a services agreement. Other Equity Method Investment—In June of 2014, the Company made an investment of $265 into an entity controlled by a related party, Moelis Asset Management LP. The Company has determined that it should account for this investment as an equity method investment on the condensed consolidated financial statements. For the three months ended September 30, 2016 and 2015, a loss of $9 and income of $287 was recorded on this investment, respectively, and income of $1,721 and $3,068 was recorded on this investment for the nine months ended September 30, 2016 and 2015, respectively. During the nine months ended September 30, 2016 and 2015, the Company received cash distributions from this entity in the amounts of $813 and $2,694 respectively. Revenues—From time to time, Moelis Asset Management LP and its affiliates hire the Company to provide financial advisory services in the ordinary course of business. The Company earned revenues associated with such transactions of $170 and $1,299 for the three months ended September 30, 2016 and 2015, respectively, and revenues of $7,186 and $5,635 for the nine months ended September 30, 2016 and 2015, respectively.

REGULATORY REQUIREMENTS	9 Months Ended
REGULATORY REQUIREMENTS	Sep. 30, 2016
REGULATORY REQUIREMENTS
REGULATORY REQUIREMENTS	11. REGULATORY REQUIREMENTS Under the SEC Uniform Net Capital Rule (SEC Rule 15c3‑1) Alternative Standard under Section (a)(1)(ii), the minimum net capital requirement is $250. At September 30, 2016, Moelis U.S. had net capital of $82,939, which was $82,689 in excess of its required net capital. At December 31, 2015, Moelis U.S. had net capital of $41,373 which was $41,123 in excess of its required net capital. Moelis U.S. does not carry customer accounts and does not otherwise hold funds or securities for, or owe money or securities to, customers and accordingly is exempt under Section (k)(2)(ii) of SEC Rule 15c3‑3. At September 30, 2016, the aggregate regulatory net capital of Moelis UK was $21,253 which exceeded the minimum requirement by $21,197. At December 31, 2015, the aggregate regulatory net capital of Moelis UK was $17,586, which exceeded the minimum requirement by $17,531.

COMMITMENTS AND CONTINGENCIES

9 Months Ended

Sep. 30, 2016

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES

12. COMMITMENTS AND CONTINGENCIES

Bank Line of Credit—In May 2015 the Company renewed its unsecured revolving credit facility which increased the commitment amount and extended the maturity date to June 30, 2017. As of September 30, 2016, the commitment amount was $40,000.

Borrowings on the facility bear interest at the greater of a fixed rate of 3.50% per annum or at the borrower’s option of (i) LIBOR plus 1% or (ii) Prime minus 1.50%. As of September 30, 2016 and December 31, 2015, the Company had no borrowings under the credit facility.

As of September 30, 2016, the Company’s available credit under this facility was $33,160 as a result of the issuance of an aggregate amount of $6,840 of various standby letters of credit, which were required in connection with certain office lease and other agreements. The Company incurs a 1% per annum fee on the outstanding balance of issued letters of credit.

Leases—The Company maintains operating leases with expiration dates that extend through 2026. The Company incurred expense relating to its operating leases of $3,342 and $3,192 for the three months ended September 30, 2016 and 2015, respectively, and expenses of $12,801 and $9,577 for the nine months ended September 30, 2016 and 2015, respectively. During the second quarter, the Company decided to sublet a portion of its growth space in the U.K. which required a sublease loss reserve to be recognized for the estimated net economics of such sublet. The expense related to operating leases for the three and nine months ended September 30, 2016, includes $0 and 2,359 related to the aforementioned sublease loss reserve, respectively.

The Company subleases office space under agreements which expire in October 2016. Sublease income from such agreements were $260 and $0 for the three months ended September 30, 2016 and 2015, respectively, and $784 and $0 for the nine months ended September 30, 2016 and 2015, respectively, which were included as reductions of occupancy expense on the condensed consolidated statements of operations.

The future minimum rental payments required under the operating leases in place at September 30, 2016, are as follows:


Fiscal year ended	Amount
Remainder of 2016 (net of $85 committed sublease income)	$	4,305
2017		17,242
2018		17,128
2019		17,126
2020		11,239
Thereafter		21,952
Total	$	88,992

Contractual Arrangements—In the normal course of business, the Company enters into contracts that contain a variety of representations and warranties and which provide indemnification for specified losses, including certain indemnification of certain officers, directors and employees.

Joint Venture Put and Call Options—In connection with the Company’s Australian JV, the Company granted a put option in April 2010 enabling the key senior Australian executive to sell his shares held in the Australian JV back to the Company at fair value. The put option can be exercised if the key senior Australian executive ceases to be employed by the Australian JV (including due to death, disability or resignation but excluding termination for cause) and following such cessation of employment, the key senior Australian executive, the remaining Australian executives and the Company are unable to agree upon a restructuring of the Australian JV. If the put option is exercised, the Company will be required to pay 50% of the purchase price upon exercise and the remaining balance within 18 months (in cash or listed stock). In addition, since April 2010, the Company has held a call option to purchase the shares from the Trust at fair value with payment terms equal to those called for under the put option.

Legal—In the ordinary course of business, from time to time the Company and its affiliates are involved in judicial or regulatory proceedings, arbitration or mediation concerning matters arising in connection with the conduct of its businesses, including contractual and employment matters. In addition, government agencies and self-regulatory organizations conduct periodic examinations and initiate administrative proceedings regarding the Company’s business, including, among other matters, compliance, accounting and operational matters, that can result in censure, fine, the issuance of cease-and-desist orders or the suspension or expulsion of a broker-dealer, investment advisor, or its directors, officers or employees. In view of the inherent difficulty of determining whether any loss in connection with such matters is probable and whether the amount of such loss can be reasonably estimated, particularly in cases where claimants seek substantial or indeterminate damages or where investigations and proceedings are in the early stages, the Company cannot estimate the amount of such loss or range of loss, if any, related to such matters, how or if such matters will be resolved, when they will ultimately be resolved, or what the eventual settlement, fine, penalty or other relief, if any, might be. Subject to the foregoing, the Company believes, based on current knowledge and after consultation with counsel, that it is not currently party to any material pending proceedings, individually or in the aggregate, the resolution of which would have a material effect on the Company.

The Company was previously named as one of several defendants in litigation arising from activities in 2011. The parties reached an agreement in principle to settle the litigation in March 2016, resulting in the Company incurring $2.8 million of expense recognized in the quarter ended December 31, 2015. The Company paid $2.8 million in September 2016 into an escrow account pending final court approval of the settlement.

EMPLOYEE BENEFIT PLANS	9 Months Ended
EMPLOYEE BENEFIT PLANS	Sep. 30, 2016
EMPLOYEE BENEFIT PLANS
EMPLOYEE BENEFIT PLANS	13. EMPLOYEE BENEFIT PLANS The Company covers substantially all U.S. salaried employees with a defined contribution 401(k) plan. Each salaried employee of the Company who has attained the age of 21 is eligible to participate in the 401(k) plan on their first day of employment. Any employer contributions to the 401(k) plan are entirely at the discretion of the Company. The Company accrued expenses relating to employer matching contributions to the 401(k) plan for the three months ended September 30, 2016 and 2015, in the amounts of $462 and $361, respectively, and $1,436 and $1,017 for the nine months ended September 30, 2016 and 2015, respectively.

INCOME TAXES	9 Months Ended
INCOME TAXES	Sep. 30, 2016
INCOME TAXES
INCOME TAXES	14. INCOME TAXES Prior to the Company’s reorganization and IPO of Moelis & Company, the Company had been primarily subject to the New York City unincorporated business tax (“UBT”) and certain other foreign, state and local taxes. The Company’s operations are comprised of entities that are organized as limited liability companies and limited partnerships. For U.S. federal income tax purposes, taxes related to income earned by these entities represent obligations of their interest holders, which are primarily made up of individual partners and members and have historically not been reflected in the condensed consolidated statements of financial condition. In connection with the Company’s reorganization and IPO, the Company became subject to U.S. corporate federal, state and local income tax on its allocable share of results of operations from Group LP. The Company’s provision for income taxes and effective tax rate were $6,550 and 16% and $5,273 and 13% for the three months ended September 30, 2016 and 2015, respectively. For the nine months ended September 30, 2016 and 2015, the Company’s provision for income taxes and effective tax rate were $16,715 and 16% and $15,652 and 16%, respectively. The income tax provision for the aforementioned periods primarily reflects the Company’s allocable share of earnings from Group LP at prevailing U.S. federal, state and local corporate income tax rates and the effect of the allocable earnings to noncontrolling interests being subject to UBT and certain other foreign, state and local taxes. The Company recorded an increase in the net deferred tax asset of $3,163 for the nine months ended September 30, 2016, which was primarily attributable to an increase in deferred compensation and the step-up in tax basis in Group LP assets resulting from the exchange of Class A partnership units in Group LP for Class A common stock during the period. Approximately $518 of this deferred tax asset is attributable to exchanges by certain partners of Group LP who are party to the tax receivable agreement. Pursuant to this agreement, 85% (or $440) of the tax benefits associated with this portion of the deferred tax asset are payable to such exchanging partners over the next 15 years and recorded as amount due pursuant to tax receivable agreement in the condensed consolidated and combined statements of financial condition. The remaining tax benefit is allocable to the Company and is recorded in additional paid-in-capital.

BUSINESS INFORMATION

9 Months Ended

Sep. 30, 2016

BUSINESS INFORMATION

BUSINESS INFORMATION

15. BUSINESS INFORMATION

The Company’s activities as an investment banking advisory firm constitute a single business segment offering clients, including corporations, governments and financial sponsors, a range of advisory services with expertise across all major industries in mergers and acquisitions, recapitalizations and restructurings and other corporate finance matters.

We do not allocate our revenue by the type of advice we provide because of the complexity of the transactions on which we may earn revenue and our comprehensive approach to client service. For example, a restructuring engagement may evolve to require a sale of all or a portion of the client, M&A assignments can develop from relationships established on prior restructuring engagements and capital markets expertise can be instrumental on both M&A and restructuring assignments.

There were no clients that accounted for more than 10% of revenues for the three or nine months ended September 30, 2016 or 2015. Since the financial markets are global in nature, the Company generally manages its business based on the operating results of the enterprise taken as whole, not by geographic region. The following table sets forth the geographical distribution of revenues and assets based on the location of the office that generates the revenues or holds the assets, and therefore may not be reflective of the geography in which our clients are located.


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2016		2015		2016		2015
Revenues:
United States	$	125,380	$	130,704	$	338,332	$	295,221
Europe		17,503		18,461		41,625		67,456
Rest of World		7,793		2,624		28,808		14,397
Total	$	150,676	$	151,789	$	408,765	$	377,074


	September 30,		December 31,
	2016		2015
Assets:
United States	$	419,671	$	463,984
Europe		26,579		45,067
Rest of World		44,098		30,410
Total	$	490,348	$	539,461

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

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+ Details

SUBSEQUENT EVENTS	9 Months Ended
SUBSEQUENT EVENTS	Sep. 30, 2016
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS	16. SUBSEQUENT EVENTS The Board of Directors of Moelis & Company declared a quarterly dividend of $0.32 per share to be paid on December 7, 2016 to Class A common stockholders of record on November 22, 2016.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

9 Months Ended

Sep. 30, 2016

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Accounting

Basis of Accounting—The Company prepared the accompanying condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). As permitted by the interim reporting rules and regulations set forth by the SEC, the condensed consolidated financial statements presented exclude certain financial information and footnote disclosures normally included in audited financial statements prepared in accordance with U.S. GAAP. In the opinion of the Company’s management, the accompanying unaudited condensed consolidated financial statements contain all adjustments, consisting of normal recurring adjustments, necessary to fairly present the accompanying unaudited condensed consolidated financial statements. These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated and combined audited financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2015.

Consolidation

Consolidation—The Company’s policy is to consolidate (i) entities, other than limited partnerships, in which it has a controlling financial interest, (ii) variable interest entities where the Company has a variable interest and is deemed to be the primary beneficiary and (iii) limited partnerships where the Company has ownership of the majority of voting interests. When the Company does not have a controlling interest in an entity, but exerts significant influence over the entity’s operating and financial decisions, the Company applies the equity method of accounting in which it records in earnings its share of income or losses of the entity. All intercompany balances and transactions with the Company’s subsidiaries have been eliminated in consolidation.

Use of Estimates

Use of Estimates—The preparation of condensed consolidated financial statements and related disclosures in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Estimates and assumptions are reviewed periodically, and the effects of revisions are reflected in the period in which they are determined to be necessary.

In preparing the condensed consolidated financial statements, management makes estimates and assumptions regarding:

·

the adequacy of the allowance for doubtful accounts;

·

the realization of deferred taxes;

·

the measurement of equity‑based compensation; and

·

other matters that affect the reported amounts and disclosures of contingencies in the financial statements.

Cash and Cash Equivalents

Cash and Cash Equivalents—Cash and cash equivalents include all short‑term highly liquid investments that are readily convertible to known amounts of cash and have original maturities of three months or less from the date of purchase.

As of September 30, 2016, the Company had cash equivalents of $154,161 (December 31, 2015: $178,872) invested primarily in government securities money market funds and U.S. Treasury Bills. Additionally, as of September 30, 2016, the Company had cash of $48,450 (December 31, 2015: $69,150) maintained in U.S. and non‑U.S. bank accounts, of which most bank account balances had little or no insurance coverage (most balances are held in U.S. and U.K. accounts which exceeded the U.S. Federal Deposit Insurance Corporation and U.K. Financial Services Compensation Scheme Coverage limits).

Restricted Cash

Restricted Cash—As of September 30, 2016 and December 31, 2015, the Company held cash of $769 and $819, respectively, in restricted collateral deposits primarily held by certain non-U.S. subsidiaries.

Receivables

Receivables—The accompanying condensed consolidated statements of financial condition present accounts receivable balances net of allowance for doubtful accounts based on the Company’s assessment of the collectability of customer accounts.

The Company maintains an allowance for doubtful accounts that, in management’s opinion, provides for an adequate reserve to cover losses that may be incurred. The Company regularly reviews the allowance by considering factors such as historical experience, credit quality, age of the accounts receivable, and the current economic conditions that may affect a customer’s ability to pay such amounts owed to the Company.

After concluding that a reserved accounts receivable is no longer collectible, the Company will charge‑off the receivable. This is determined based on several factors including the age of the accounts receivable and the credit worthiness of the customer. This has the effect of reducing both the gross receivable and the allowance for doubtful accounts.

Deferred Compensation

Deferred Compensation—Deferred compensation costs represent arrangements with certain employees whereby cash payments are subject to a required period of service subsequent to payment by the Company. These amounts are charged to expenses over the period that the employee is required to provide services in order to vest in the payment.

Financial Instruments at Fair Value

Financial Instruments at Fair Value—Fair value is generally based on quoted prices, however if quoted market prices are not available, fair value is determined based on other relevant factors, including dealer price quotations, price activity for equivalent instruments and valuation pricing models. The Company established a fair value hierarchy which prioritizes and ranks the level of market price observability used in measuring financial instruments at fair value. Market price observability is affected by a number of factors, including the type of instrument, the characteristics specific to the instrument and the state of the marketplace (including the existence and transparency of transactions between market participants). Financial instruments with readily‑available actively quoted prices or for which fair value can be measured from actively‑quoted prices in an orderly market will generally have a higher degree of market price observability and a lesser degree of judgment used in measuring fair value.

Financial instruments measured and reported at fair value are classified and disclosed in one of the following categories (from highest to lowest) based on inputs:

Level 1—Quoted prices (unadjusted) are available in active markets for identical instruments that the Company has the ability to access as of the reporting date. The Company, to the extent that it holds such instruments, does not adjust the quoted price for these instruments, even in situations in which the Company holds a large position and a sale could reasonably affect the quoted price.

Level 2—Pricing inputs are observable for the instruments, either directly or indirectly, as of the reporting date, but are not the same as those used in Level 1. Fair value is determined through the use of models or other valuation methodologies.

Level 3—Pricing inputs are unobservable for the instruments and include situations where there is little, if any, market activity for the investments. The inputs into the determination of fair value require significant judgment or estimation by the Company’s management.

In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the determination of which category within the fair value hierarchy is appropriate for any given investment is based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the instrument.

For level 3 investments in which pricing inputs are unobservable and limited market activity exists, management’s determination of fair value is based on the best information available, may incorporate management’s own assumptions and involves a significant degree of judgment.

Equity Method Investments

Equity Method Investments—The Company accounts for its equity method investments under the equity method of accounting as the Company does not control these entities but has the ability to exercise significant influence. The amounts recorded on the condensed consolidated financial statements of financial condition reflects the Company’s share of contributions made to, distributions received from, and the equity earnings and losses of, the investments. The Company reflects its share of gains and losses of the investment in income (loss) from equity method investments in the condensed consolidated statements of operations.

Equipment and Leasehold Improvements

Equipment and Leasehold Improvements—Office equipment and furniture and fixtures are stated at cost less accumulated depreciation, which is determined using the straight‑line method over the estimated useful lives of the assets, ranging from three to seven years, respectively. Leasehold improvements are stated at cost less accumulated amortization, which is determined using the straight‑line method over the lesser of the term of the lease or the estimated useful life of the asset.

Major renewals and improvements are capitalized and minor replacements, maintenance and repairs are charged to expenses as incurred. Upon retirement or disposal of assets, the cost and related accumulated depreciation or amortization are removed from the condensed consolidated statements of financial condition and any gain or loss is reflected in the condensed consolidated statements of operations.

Deferred Tax Asset and Amount Due Pursuant to Tax Receivable Agreement

Deferred Tax Asset and Amount Due Pursuant to Tax Receivable Agreement—In conjunction with the IPO, the Company was treated for U.S. federal income tax purposes as having directly purchased Class A partnership units in Group LP from the existing unitholders. Additional Group LP Class A partnership units may be exchanged for shares of Class A common stock in the Company. The initial purchase and future exchanges are expected to result in an increase in the tax basis of Group LP’s assets attributable to the Company’s interest in Group LP. These increases in the tax basis of Group LP’s assets attributable to the Company’s interest in Group LP would not have been available but for the initial purchase and future exchanges. Such increases in tax basis are likely to increase (for tax purposes) depreciation and amortization deductions and therefore reduce the amount of income tax the Company would otherwise be required to pay in the future. As a result, the Company records a deferred tax asset for such increase in tax basis.

The Company has entered into a tax receivable agreement with its eligible Managing Directors that will provide for the payment by the Company to its eligible Managing Directors of 85% of the amount of cash savings, if any, in U.S. federal, state and local income tax or franchise tax that the Company actually realizes as a result of (a) the increases in tax basis attributable to exchanges by its eligible Managing Directors and (b) tax benefits related to imputed interest deemed to be paid by the Company as a result of this tax receivable agreement. The Company expects to benefit from the remaining 15% of cash savings, if any, in income tax that it realizes and record any such estimated tax benefits as an increase to additional paid-in-capital. For purposes of the tax receivable agreement, cash savings in income tax will be computed by comparing the Company’s actual income tax liability to the amount of such taxes that it would have been required to pay had there been no increase to the tax basis of the tangible and intangible assets of Group LP as a result of the exchanges and had it not entered into the tax receivable agreement. The term of the tax receivable agreement commenced upon consummation of the IPO and will continue until all such tax benefits have been utilized or expired, unless the Company exercises its right to terminate the tax receivable agreement for an amount based on an agreed value of payments remaining to be made under the agreement. The Company has recorded the estimated tax benefits related to the increase in tax basis and imputed interest as a result of the initial purchase and subsequent exchanges described above as a deferred tax asset in the condensed consolidated statements of financial condition. The amount due to its eligible Managing Directors related to the tax receivable agreement as a result of the initial purchase and subsequent exchanges described above is recorded as amount due pursuant to tax receivable agreement in the condensed consolidated statements of financial condition. The amounts recorded for the deferred tax asset and the liability for our obligations under the tax receivable agreement are estimates. Any adjustments to our estimates subsequent to their initial establishment will be included in net income (loss). Future exchanges of Class A partnership units in Group LP for Class A common shares in the Company will be accounted for in a similar manner.

Revenue and Expense Recognition

Revenue and Expense Recognition—The Company recognizes revenues from providing advisory services when earned and collection is reasonably assured. Upfront fees are recognized over the estimated period that the related services are performed. Transaction‑related fees are recognized when all services for a transaction have been provided, specified conditions have been met and the transaction closes. Underwriting revenues are recognized when the offering is deemed complete and is presented net of related expenses. Deferred revenues are recorded for fees received that have not yet been earned. Expenses are reflected on the condensed consolidated statements of operations, net of client reimbursements. Reimbursable expenses billed to clients totaled $4,051 and $3,639 for the three months ended September 30, 2016 and 2015, respectively, and $11,445 and $9,510 for the nine months ended September 30, 2016 and 2015, respectively.

Equity-based Compensation

Equity‑based Compensation—The Company recognizes the cost of employee services received in exchange for an equity instrument award. The cost is based on its grant-date fair value based on quoted market prices at the time of grant amortized over the service period required by the award’s vesting terms. The Company records as treasury stock shares repurchased from its employees for the purpose of settling tax liabilities incurred upon the vesting of restricted stock units (“RSUs”). The Company records dividends in kind, net of forfeitures, on outstanding RSUs as a dividend payment and a charge to equity. Dividends in kind on RSUs are subject to the same vesting conditions as the underlying RSUs on which they were accrued. Dividends in kind will be forfeited if the award does not vest.

For the purposes of calculating diluted net income (loss) per share to holders of Class A common stock, unvested service‑based awards are included in the diluted weighted average shares of Class A common stock outstanding using the treasury stock method. See Note 7 for further discussion.

The Company generally permits a retiring employee to retain and not forfeit certain qualifying incentive RSUs granted during employment if at retirement the employee (i) is at least 54 years old and (ii) has provided at least 8 consecutive years of service to the Company. Any such RSUs will continue to vest on their applicable vesting schedule, subject to noncompetition and other terms. Over time a greater number of employees may become retirement eligible and the related requisite service period over which we will expense these awards will be shorter than the stated vesting period. Any unvested RSUs prior to meeting the stated requisite service period or retirement eligibility date are eligible to receive dividends in kind; however, the right to dividends in kind will be forfeited if the underlying award does not vest.

Income Taxes

Income Taxes—The Company accounts for income taxes in accordance with ASC 740, “Accounting for Income Taxes” (“ASC 740”), which requires the recognition of tax benefits or expenses on temporary differences between the financial reporting and tax bases of its assets and liabilities by applying the enacted tax rates in effect for the year in which the differences are expected to reverse. Such net tax effects on temporary differences are reflected on the Company’s condensed consolidated statements of financial condition as deferred tax assets and liabilities. Deferred tax assets are reduced by a valuation allowance when the Company believes that it is more‑likely‑than‑not that some portion or all of the deferred tax assets will not be realized.

ASC 740‑10 prescribes a two‑step approach for the recognition and measurement of tax benefits associated with the positions taken or expected to be taken in a tax return that affect amounts reported in the financial statements. The Company has reviewed and will continue to review the conclusions reached regarding uncertain tax positions, which may be subject to review and adjustment at a later date based on ongoing analyses of tax laws, regulations and interpretations thereof. For the three and nine months ended September 30, 2016 and 2015, no unrecognized tax benefit was recorded. To the extent that the Company’s assessment of the conclusions reached regarding uncertain tax positions changes as a result of the evaluation of new information, such change in estimate will be recorded in the period in which such determination is made. The Company reports income tax‑related interest and penalties relating to uncertain tax positions, if applicable, as a component of income tax expense. For the three and nine months ended September 30, 2016 and 2015, no such amounts were recorded.

Foreign Currency Translation

Foreign Currency Translation—Assets and liabilities held in non‑U.S. dollar denominated (functional) currencies are translated into U.S. dollars at exchange rates in effect at the end of the reporting period. Revenues and expenses are translated at average exchange rates during the reporting period. A charge or credit is recorded to other comprehensive income to reflect the translation of these amounts to the extent the non‑U.S. currency is designated the functional currency of the subsidiary. Non‑functional currency related transaction gains and losses are immediately recorded in the condensed consolidated statements of operations.

EQUIPMENT AND LEASEHOLD IMPROVEMENTS (Tables)

9 Months Ended

Sep. 30, 2016

EQUIPMENT AND LEASEHOLD IMPROVEMENTS

Schedule of equipment and leasehold improvements, net


	September 30,		December 31,
	2016		2015
Office equipment	$	12,449	$	11,193
Furniture and fixtures		3,259		2,916
Leasehold improvements		8,049		7,073
Total		23,757		21,182
Less accumulated depreciation and amortization		(14,678)		(12,484)
Equipment and leasehold improvements, net	$	9,079	$	8,698

FAIR VALUE MEASUREMENTS (Tables)

9 Months Ended

Sep. 30, 2016

FAIR VALUE MEASUREMENTS

Summary of the levels of the fair value hierarchy into which the Company's financial assets fall

The following table summarizes the levels of the fair value hierarchy into which the Company’s financial assets fall as of September 30, 2016:


	Total		Level 1		Level 2		Level 3
Financial assets:
Included in cash and cash equivalents
U.S. treasury bills	$	112,485	$	42,487	$	69,998	$	—
Government securities money market		41,676		—		41,676		—
Investments
U.S. treasury bills		32,976		—		32,976		—
Common stock		530		530		—		—
Total financial assets	$	187,667	$	43,017	$	144,650	$	—

The following table summarizes the levels of the fair value hierarchy into which the Company’s financial assets fall as of December 31, 2015:


	Total		Level 1		Level 2		Level 3
Financial assets:
Included in cash and cash equivalents
U.S. treasury bills	$	100,996	$	71,998	$	28,998	$	—
Government securities money market		77,876		—		77,876		—
Investments
U.S. treasury bills		37,989		19,990		17,999		—
Convertible notes		635		—		—		635
Total financial assets	$	217,496	$	91,988	$	124,873	$	635

Schedule of changes to the Company's investment classified as Level 3


	Convertible notes
January 1, 2016	$	635
Unrealized gains (losses) included in accumulated other comprehensive income		22
March 31, 2016		657
Unrealized gains (losses) included in accumulated other comprehensive income		21
June 30, 2016		678
Transfer out of level 3 due to conversion of convertible notes to common stock		(678)
September 30, 2016	$	—

- Definition

Tabular disclosure of financial instruments measured at fair value, including those classified in shareholders' equity measured on a recurring or nonrecurring basis. Disclosures include, but are not limited to, fair value measurements recorded and the reasons for the measurements, level within the fair value hierarchy in which the fair value measurements are categorized and transfers between levels 1 and 2. Nonrecurring fair value measurements are those that are required or permitted in the statement of financial position in particular circumstances.

+ References + Details

NET INCOME (LOSS) PER SHARE ATTRIBUTABLE TO CLASS A COMMON SHAREHOLDERS (Tables)

9 Months Ended

Sep. 30, 2016

NET INCOME (LOSS) PER SHARE ATTRIBUTABLE TO CLASS A COMMON SHAREHOLDERS

Schedule of calculations of basic and diluted net income (loss) per share

	Three Months Ended September 30,						Nine Months Ended September 30,
(dollars in thousands, except per share amounts)	2016			2015			2016			2015
Numerator:
Net income (loss) attributable to holders of shares of Class A common stock—basic	$	9,489		$	10,090		$	23,352		$	22,557
Add (deduct) dilutive effect of:
Noncontrolling interests related to Class A partnership units			(a)			(a)			(a)			(a)
Net income (loss) attributable to holders of shares of Class A common stock—diluted	$	9,489		$	10,090		$	23,352		$	22,557
Denominator:
Weighted average shares of Class A common stock outstanding—basic		20,926,745			20,184,835			20,807,189			19,919,675
Add (deduct) dilutive effect of:
Noncontrolling interests related to Class A partnership units			(a)			(a)			(a)			(a)
Weighted average number of incremental shares issuable from unvested restricted stock, RSUs and stock options, as calculated using the treasury stock method		3,374,318	(b)		1,281,186	(b)		2,709,050	(b)		1,185,848	(b)
Weighted average shares of Class A common stock outstanding—diluted		24,301,063			21,466,021			23,516,239			21,105,523
Net income (loss) per share attributable to holders of shares of Class A common stock
Basic	$	0.45		$	0.50		$	1.12		$	1.13
Diluted	$	0.39		$	0.47		$	0.99		$	1.07

We have not included the impact of Class B common stock because these shares are entitled to an insignificant amount of economic participation.

(a)Class A partnership units may be exchanged for Moelis & Company Class A common stock on a one‑for‑one basis, subject to applicable lock‑up, vesting and transfer restrictions. If all Class A partnership units were to be exchanged for Class A common stock, fully diluted Class A common stock outstanding would be 58,000,602 and 55,398,692 for the three months ended September 30, 2016 and 2015, respectively, and 57,335,334 and 55,303,354 for the nine months ended September 30, 2016 and 2015, respectively. In computing the dilutive effect, if any, that the aforementioned exchange would have on net income (loss) per share, net income (loss) available to holders of Class A common stock would be adjusted due to the elimination of the noncontrolling interests in consolidated entities associated with the Group LP Class A partnership units (including any tax impact). For the three and nine months ended September 30, 2016 and 2015, such exchange is not reflected in diluted net income (loss) per share as the assumed exchange is not dilutive.

(b)During the three and nine months ended September 30, 2016 and 2015, certain shares of Moelis & Company’s Class A common stock assumed to be issued pursuant to certain RSUs as calculated using the treasury stock method were antidilutive and therefore have been excluded from the calculation of diluted net income (loss) per share attributable to Moelis & Company. During the three months ended September 30, 2016 and 2015, the additional weighted average amount of RSUs that would have been included in this calculation if the effect were dilutive would have been 2,552 and 15,397 units, respectively, and 1,211 and 7,945 units for the nine months ended September 30, 2016 and 2015, respectively. Additionally, during the three months ended September 30, 2016 and 2015, the additional weighted average amount of options that would have been included in this calculation if the effect were dilutive would have been 973,859 and 1,049,977, respectively, and 1,048,196 and 0 weighted average options for the nine months ended September 30, 2016 and 2015, respectively.

EQUITY-BASED COMPENSATION (Tables)

9 Months Ended

Sep. 30, 2016

EQUITY-BASED COMPENSATION

Summary of activity related to restricted stock and RSUs


	Restricted Stock & RSUs
	2016			2015
		Weighted Average			Weighted Average
	Number of	Grant Date		Number of	Grant Date
	Shares	Fair Value		Shares	Fair Value
Unvested Balance at January 1,	5,123,481	$	28.67	2,473,624	$	25.86
Granted	3,787,723		24.09	2,615,660		31.92
Forfeited	(74,739)		26.05	(36,903)		28.79
Vested	(586,953)		28.30	(92,717)		27.45
Unvested Balance at September 30,	8,249,512	$	26.81	4,959,664	$	28.93

Schedule of assumptions used to estimate the fair value of stock option using the Black-Scholes valuation model


	Assumptions
Expected life (in years)		6
Weighted-average risk free interest rate		1.91	%
Expected volatility		35	%
Dividend yield		2.72	%
Weighted-average fair value at grant date	$	6.70

Summary of activity related to stock options


	Stock Options Outstanding
	2016			2015
		Weighted-Average			Weighted-Average
	Number	Exercise Price		Number	Exercise Price
	Outstanding	Per Share		Outstanding	Per Share
Outstanding at January 1,	3,081,203	$	23.20	3,296,906	$	24.00
Grants	—		—	—		—
Exercises	—		—	—		—
Forfeiture or expirations	(208,975)		23.20	(174,727)		24.00
Outstanding at September 30,	2,872,228	$	23.20	3,122,179	$	24.00

COMMITMENTS AND CONTINGENCIES (Tables)

9 Months Ended

Sep. 30, 2016

COMMITMENTS AND CONTINGENCIES

Schedule of future minimum rental payments required under the operating leases in place


Fiscal year ended	Amount
Remainder of 2016 (net of $85 committed sublease income)	$	4,305
2017		17,242
2018		17,128
2019		17,126
2020		11,239
Thereafter		21,952
Total	$	88,992

BUSINESS INFORMATION (Tables)

9 Months Ended

Sep. 30, 2016

BUSINESS INFORMATION

Schedule of geographical distribution of revenues and assets


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2016		2015		2016		2015
Revenues:
United States	$	125,380	$	130,704	$	338,332	$	295,221
Europe		17,503		18,461		41,625		67,456
Rest of World		7,793		2,624		28,808		14,397
Total	$	150,676	$	151,789	$	408,765	$	377,074


	September 30,		December 31,
	2016		2015
Assets:
United States	$	419,671	$	463,984
Europe		26,579		45,067
Rest of World		44,098		30,410
Total	$	490,348	$	539,461

ORGANIZATION AND BASIS OF PRESENTATION (Details)	Sep. 30, 2016
Moelis Australia Holdings
Equity Method Investments
Ownership percentage (as a percent)	50.00%

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Cash and Cash Equivalents
Cash equivalents	$ 154,161	$ 178,872
Cash	48,450	69,150
Restricted Cash
Cash in restricted collateral accounts	$ 769	$ 819

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Equipment, Deferred Tax Asset, Revenue and Expense Recognition, Equity-Based Compensation and Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Deferred Tax Asset and Amount Due Pursuant to Tax Receivable Agreement
Percentage of tax benefits payable to partners under tax receivable agreement			85.00%
Remaining percentage of cash savings realized by the Company (as a percent)			15.00%
Revenue and Expense Recognition
Reimbursable expenses billed to clients	$ 4,051	$ 3,639	$ 11,445	$ 9,510
Equity-based Compensation
Minimum age of retiring employees required so that certain qualifying awards granted during employment will not be forfeited			54 years
Consecutive years of service of retiring employees required so that certain qualifying awards granted during employment will not be forfeited			8 years
Income Taxes
Unrecognized tax benefits	0	0	$ 0	0
Unrecognized tax benefits, interest and penalties	$ 0	$ 0	$ 0	$ 0
Office equipment and furniture and fixtures \| Minimum
Equipment and leasehold improvements, net
Useful lives			3 years
Office equipment and furniture and fixtures \| Maximum
Equipment and leasehold improvements, net
Useful lives			7 years

EQUITY METHOD INVESTMENTS (Details) - USD ($) $ in Thousands	1 Months Ended	3 Months Ended		9 Months Ended
	Jun. 30, 2014	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Equity Method Investments
Income (loss) from equity method investments		$ 1,562	$ 450	$ 3,897	$ 3,510
Moelis Australia Holdings
Equity Method Investments
Ownership percentage (as a percent)		50.00%		50.00%
Income (loss) from equity method investments		$ 1,571	163	$ 2,176	442
Entity controlled by Moelis Asset Management LP
Equity Method Investments
Cash contribution made	$ 265
Income (loss) from equity method investments		$ (9)	$ 287	1,721	3,068
Cash distributions				$ 813	$ 2,694

EQUIPMENT AND LEASEHOLD IMPROVEMENTS (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2015
Equipment and leasehold improvements, net
Total	$ 23,757		$ 23,757		$ 21,182
Less accumulated depreciation and amortization	(14,678)		(14,678)		(12,484)
Equipment and leasehold improvements, net	9,079		9,079		8,698
Depreciation and amortization expenses	817	$ 646	2,359	$ 1,954
Office equipment
Equipment and leasehold improvements, net
Total	12,449		12,449		11,193
Furniture and fixtures
Equipment and leasehold improvements, net
Total	3,259		3,259		2,916
Leasehold improvements
Equipment and leasehold improvements, net
Total	$ 8,049		$ 8,049		$ 7,073

FAIR VALUE MEASUREMENTS - Fair Value of Financial Assets and Liabilities (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2016	Dec. 31, 2015
Fair value measurements
Investments in securities	$ 33,506	$ 38,624
Total financial assets	$ 187,667	217,496
Convertible notes
Fair value measurements
Investments in securities		635
U.S. treasury bills
Fair value measurements
Maximum investment term	12 months
Cash and cash equivalents	$ 112,485	100,996
Investments in securities	32,976	37,989
Government securities money market
Fair value measurements
Cash and cash equivalents	41,676	77,876
Common Stock
Fair value measurements
Investments in securities	530
Level 1
Fair value measurements
Total financial assets	43,017	91,988
Level 1 \| U.S. treasury bills
Fair value measurements
Cash and cash equivalents	42,487	71,998
Investments in securities		19,990
Level 1 \| Common Stock
Fair value measurements
Investments in securities	530
Level 2
Fair value measurements
Total financial assets	144,650	124,873
Level 2 \| U.S. treasury bills
Fair value measurements
Cash and cash equivalents	69,998	28,998
Investments in securities	32,976	17,999
Level 2 \| Government securities money market
Fair value measurements
Cash and cash equivalents	$ 41,676	77,876
Level 3
Fair value measurements
Total financial assets		635
Level 3 \| Convertible notes
Fair value measurements
Investments in securities		$ 635

FAIR VALUE MEASUREMENTS - Changes to Level 3 Investment and Transfers (Details) - USD ($) $ in Thousands	3 Months Ended				9 Months Ended
	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Changes to the Company's investment classified as Level 3
Transfers from level 1 to level 2	$ 7,984				$ 7,984
Transfers between level 1, level 2 or level 3				$ 0		$ 0
Convertible notes
Changes to the Company's investment classified as Level 3
Balance at beginning of the period	678	$ 657	$ 635		$ 635
Unrealized gains (losses) included in accumulated other comprehensive income		21	22
Transfer out of level 3 due to conversion of convertible notes to common stock	$ (678)
Balance at end of the period		$ 678	$ 657

NET INCOME (LOSS) PER SHARE ATTRIBUTABLE TO CLASS A COMMON SHAREHOLDERS (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015	Apr. 30, 2014
Numerator:
Net income (loss) attributable to holders of shares of Class A common stock - basic	$ 9,489	$ 10,090	$ 23,352	$ 22,557
Class A common stock
Numerator:
Net income (loss) attributable to holders of shares of Class A common stock - basic	9,489	10,090	23,352	22,557
Net income (loss) attributable to holders of shares of Class A common stock - diluted	$ 9,489	$ 10,090	$ 23,352	$ 22,557
Denominator:
Weighted average shares of Class A common stock outstanding - basic	20,926,745	20,184,835	20,807,189	19,919,675
Weighted average number of incremental shares issuable from unvested restricted stock, RSUs and stock options, as calculated using the treasury stock method	3,374,318	1,281,186	2,709,050	1,185,848
Weighted average shares of Class A common stock outstanding—diluted	24,301,063	21,466,021	23,516,239	21,105,523
Net income (loss) per share attributable to holders of shares of Class A common stock
Basic (in dollars per share)	$ 0.45	$ 0.50	$ 1.12	$ 1.13
Diluted (in dollars per share)	$ 0.39	$ 0.47	$ 0.99	$ 1.07
Number of shares of common stock to be issued upon exchange of a partnership unit	1		1		1
Fully diluted shares of common stock outstanding if all Class A partnership units were to be exchanged for common stock immediately following the reorganization	58,000,602	55,398,692	57,335,334	55,303,354
Class A common stock \| Restricted stock and RSUs
Net income (loss) per share attributable to holders of shares of Class A common stock
Number of antidilutive securities excluded from calculation of diluted income (loss) per share	2,552	15,397	1,211	7,945
Class A common stock \| Stock options
Net income (loss) per share attributable to holders of shares of Class A common stock
Number of antidilutive securities excluded from calculation of diluted income (loss) per share	973,859	1,049,977	1,048,196	0

EQUITY-BASED COMPENSATION - Partnership Units and 2014 Omnibus Incentive Plan (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015	Mar. 31, 2015	Apr. 30, 2014
Class A common stock
Equity-based compensation
Number of shares of common stock to be issued upon exchange of a partnership unit	1		1			1
Class A common stock \| Share repurchase program authorized first quarter 2015
Equity-based compensation
Share value authorized for repurchase					$ 25,000
Stock Repurchase Program, Remaining Authorized Repurchase Amount	$ 20,000		$ 20,000
Partnership units
Equity-based compensation
Units held by partners	33,698,300		33,698,300
Unvested units held by partners	578,171		578,171
Compensation expenses	$ 743	$ 945	$ 2,376	$ 2,857
Unrecognized compensation expenses	$ 3,974		$ 3,974
Weighted average period to recognize unrecognized compensation expense			1 year 8 months 12 days
Managing Directors \| Partnership units \| Minimum
Equity-based compensation
Vesting period			5 years
Managing Directors \| Partnership units \| Maximum
Equity-based compensation
Vesting period			8 years
Non-managing director employees \| Partnership units
Equity-based compensation
Vesting period			4 years

EQUITY-BASED COMPENSATION - Restricted Stock and Stock Options (Details) - USD ($) $ / shares in Units, $ in Thousands			1 Months Ended	3 Months Ended		9 Months Ended		12 Months Ended
	Mar. 04, 2016	Nov. 24, 2014	Apr. 30, 2014	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2014	Nov. 25, 2014
Restricted stock and RSUs
Number of shares
Unvested Balance at the beginning of the period (in shares)						5,123,481	2,473,624
Granted (in shares)						3,787,723	2,615,660
Forfeited (in shares)						(74,739)	(36,903)
Vested (in shares)						(586,953)	(92,717)
Unvested Balance at the end of the period (in shares)				8,249,512	4,959,664	8,249,512	4,959,664	2,473,624
Weighted Average Grant Date Fair Value
Unvested Balance at the beginning of the period (in dollars per share)						$ 28.67	$ 25.86
Granted (in dollars per share)						24.09	31.92
Forfeited (in dollars per share)						26.05	28.79
Vested (in dollars per share)						28.30	27.45
Unvested Balance at the end of the period (in dollars per share)				$ 26.81	$ 28.93	$ 26.81	$ 28.93	$ 25.86
Total compensation expense not yet recognized				$ 103,327		$ 103,327
Forfeiture rate (as a percent)						3.00%
Weighted average period to recognize compensation expense						2 years
RSUs
Equity-based compensation
Compensation expenses				16,439	$ 10,826	$ 51,233	$ 27,398
RSUs \| Minimum
Equity-based compensation
Vesting period						4 years
RSUs \| Maximum
Equity-based compensation
Vesting period						5 years
Stock options
Equity-based compensation
Vesting period								5 years
Compensation expenses				426	$ 1,048	$ 2,704	$ 3,082
Weighted Average Grant Date Fair Value
Total compensation expense not yet recognized				$ 6,954		$ 6,954
Forfeiture rate (as a percent)						3.00%
Weighted average period to recognize compensation expense						2 years 1 month 6 days
Assumptions used to estimate fair value
Expected life (in years)						6 years
Weighted-average risk free interest rate (as a percent)						1.91%
Expected volatility (as a percent)						35.00%
Dividend yield (as a percent)						2.72%
Weighted - average fair value at grant date						$ 6.70
Special dividends paid (in dollars per share)	$ 0.80	$ 1.00
Reduction to exercise price of options outstanding due to special dividend paid (in dollars per share)		1.80
Exercise price (in dollars per share)		$ 25.00							$ 23.20
Number Outstanding
Outstanding at the beginning of the period (in shares						3,081,203	3,296,906
Grants (in shares)			3,501,881
Forfeiture or expirations (in shares)						(208,975)	(174,727)
Outstanding at the end of the period (in shares				2,872,228	3,122,179	2,872,228	3,122,179	3,296,906
Weighted-Average Exercise Price Per Share
Outstanding at the beginning of the period (in dollars per share)						$ 23.20	$ 24.00
Forfeiture or expirations (in dollars per share)						23.20	24.00
Outstanding at the end of the period (in dollars per share)				$ 23.20	$ 24.00	$ 23.20	$ 24.00	$ 24.00

STOCKHOLDERS EQUITY (Details) $ in Thousands	1 Months Ended		9 Months Ended
STOCKHOLDERS EQUITY (Details) $ in Thousands	Nov. 30, 2014 USD ($) shares	Apr. 30, 2014 shares	Sep. 30, 2016 USD ($) shares	Sep. 30, 2015 USD ($) shares	Dec. 31, 2015 shares
Stockholders Equity
Treasury stock shares acquired (in shares)			98,126	242,619
Treasury stock shares acquired \| $			$ 2,621	$ 7,006
Group LP
Stockholders Equity
Number of units held by noncontrolling interest holders			33,698,300		33,803,921
Noncontrolling interests (as a percent)			62.00%		63.00%
Class A common stock
Stockholders Equity
Aggregate stock issuance (in shares)		15,263,653
Reorganization of equity structure (in shares)		7,699,851
Common Stock issued in connection with settlement of appreciation rights issued in prior years (in shares)		88,802
Common stock, shares issued			20,894,035		20,536,740
Common stock, shares outstanding			20,532,287		20,273,118
Number of shares of common stock to be issued upon exchange of a partnership unit		1	1
Class A common stock \| IPO
Stockholders Equity
Common Stock issued (in shares)		7,475,000
Class A common stock \| Secondary Offering
Stockholders Equity
Issuance of new and sale of existing common stock (in shares)	6,325,000
Issuance of Class A common stock and acquisition of Class A partnership units in connection with secondary offering (in shares)	4,511,058
Class A common stock \| Group LP
Stockholders Equity
Common stock, shares outstanding			20,532,287
Class B common stock
Stockholders Equity
Common Stock issued (in shares)		36,158,698
Common stock, shares issued			31,138,193		31,229,236
Common stock, shares outstanding			31,138,193		31,229,236
Ratio of subscription price to the initial public offering price of shares of common stock		0.00055
Dividends payable ratio to outstanding shares of publicly traded common stock		0.00055
Class B common stock \| Secondary Offering
Stockholders Equity
Shares converted	2,998,322
Shares issued upon conversion	1,658
Conversion ratio	0.00055
Number of shares repurchased and retired	1,509,131
Value of stock repurchased and retired \| $	$ 28
Class B common stock \| Maximum
Stockholders Equity
Aggregate number of shares of Class B common stock that may be converted into Class A common stock		20,000

RELATED-PARTY TRANSACTIONS (Details) $ in Thousands		3 Months Ended		9 Months Ended		12 Months Ended
RELATED-PARTY TRANSACTIONS (Details) $ in Thousands	Aug. 30, 2014 item	Sep. 30, 2016 USD ($)	Sep. 30, 2015 USD ($)	Sep. 30, 2016 USD ($)	Sep. 30, 2015 USD ($)	Dec. 31, 2015 USD ($)	Jun. 30, 2014 USD ($)
Related-party transactions
Investment into the entity controlled by a related party		$ 20,309		$ 20,309		$ 17,459
Income (loss) from equity method investments		1,562	$ 450	3,897	$ 3,510
Manager \| Aircraft lease entered into during August 2014
Related-party transactions
Expenses		312	312	936	936
Number of other lessees \| item	2
Employees \| Unsecured promissory notes
Related-party transactions
Unsecured promissory notes from employees		937		$ 937		$ 119
Interest rates (as a percent)				4.00%		4.00%
Principal repayments				$ 0	0
Interest income recognized				15	4
Moelis Australia Holdings
Related-party transactions
Due from related party		1,035		1,035
Due to related party						$ 167
Income (loss) from equity method investments		1,571	163	2,176	442
Moelis Asset Management LP
Related-party transactions
Fee for services		285	420	996	1,265
Due from related party		0		0		$ 3
Investment into the entity controlled by a related party							$ 265
Income (loss) from equity method investments		(9)	287	1,721	3,068
Cash distributions				813	2,694
Revenue from related parties		$ 170	$ 1,299	$ 7,186	$ 5,635

REGULATORY REQUIREMENTS (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Regulatory requirements
Minimum net capital requirement	$ 250
Moelis US
Regulatory requirements
Net capital	82,939	$ 41,373
Net capital in excess of required net capital	82,689	41,123
Moelis UK
Regulatory requirements
Net capital	21,253	17,586
Net capital in excess of required net capital	$ 21,197	$ 17,531

COMMITMENTS AND CONTINGENCIES - Bank Line of Credit and Leases (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2015
Leases
Rent expense incurred relating to operating leases	$ 3,342	$ 3,192	$ 12,801	$ 9,577
Sublease loss reserve	0		2,359
Sublease income	260	$ 0	784	$ 0
Future minimum rental payments
Remainder of 2016 (net of $85 committed sublease income)	4,305		4,305
Committed sublease income	85		85
2017	17,242		17,242
2018	17,128		17,128
2019	17,126		17,126
2020	11,239		11,239
Thereafter	21,952		21,952
Total	88,992		88,992
Unsecured revolving credit facility
Future minimum rental payments
Commitment amount	$ 40,000		$ 40,000
Fixed rate of interest (as a percent)	3.50%		3.50%
Borrowings under the credit facility	$ 0		$ 0		$ 0
Available credit under the facility	33,160		$ 33,160
Unsecured revolving credit facility \| LIBOR
Future minimum rental payments
Reference rate (as a percent)			LIBOR
Interest rate margin (as a percent)			1.00%
Unsecured revolving credit facility \| Prime
Future minimum rental payments
Reference rate (as a percent)			Prime
Interest rate margin (as a percent)			(1.50%)
Standby letters of credit
Future minimum rental payments
Letters of credit outstanding	$ 6,840		$ 6,840
Fee on the outstanding balances (as a percent)			1.00%

COMMITMENTS AND CONTINGENCIES - Joint Venture Put and Call Options and Legal (Details) - USD ($) $ in Millions	1 Months Ended	3 Months Ended	9 Months Ended
	Sep. 30, 2016	Dec. 31, 2015	Sep. 30, 2016
Legal
Litigation settlement expense		$ 2.8
Litigation settlement paid in escrow	$ 2.8
Moelis Australia Holdings
Joint venture put and call options
Percentage of purchase price to be paid immediately if the Parent is public and the put option is exercised	50.00%		50.00%
Period within which the remaining balance is to be paid if the parent is public and the put option is exercised			18 months

EMPLOYEE BENEFIT PLANS (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
EMPLOYEE BENEFIT PLANS (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
EMPLOYEE BENEFIT PLANS
Minimum age required to be eligible to participate in the 401(k) plan			21 years
Expenses accrued relating to employer matching contributions	$ 462	$ 361	$ 1,436	$ 1,017

INCOME TAXES (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
INCOME TAXES (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Income taxes
Provision for income taxes	$ 6,550	$ 5,273	$ 16,715	$ 15,652
Effective tax rate (as a percent)	16.00%	13.00%	16.00%	16.00%
Net deferred tax asset increase			$ 3,163
Group LP
Income taxes
Deferred tax assets attributable to exchanges by partners			$ 518
Percentage of cash distribution to partners in connection to IPO attributable to exchanges by partners, payable to partners			85.00%
Cash distribution to partners in connection to IPO attributable to exchanges by partners, payable to partners			$ 440
Period of tax receivable agreement			15 years

BUSINESS INFORMATION (Details) $ in Thousands	3 Months Ended		9 Months Ended
BUSINESS INFORMATION (Details) $ in Thousands	Sep. 30, 2016 USD ($) item	Sep. 30, 2015 USD ($) item	Sep. 30, 2016 USD ($) item	Sep. 30, 2015 USD ($) item	Dec. 31, 2015 USD ($)
Business information
Total revenues	$ 150,676	$ 151,789	$ 408,765	$ 377,074
Total assets	$ 490,348		$ 490,348		$ 539,461
Client \| Revenue
Business information
Number of clients \| item	0	0	0	0
Client \| Revenue \| Minimum
Business information
Concentration risk (as a percent)	10.00%	10.00%	10.00%	10.00%
United States
Business information
Total revenues	$ 125,380	$ 130,704	$ 338,332	$ 295,221
Total assets	419,671		419,671		463,984
Europe
Business information
Total revenues	17,503	18,461	41,625	67,456
Total assets	26,579		26,579		45,067
Rest Of World
Business information
Total revenues	7,793	$ 2,624	28,808	$ 14,397
Total assets	$ 44,098		$ 44,098		$ 30,410

SUBSEQUENT EVENTS (Details)	Dec. 07, 2016 $ / shares
Subsequent event
Subsequent events
Dividends declared per share	$ 0.32