Investments and Fair Value Measurements
|9 Months Ended|
Sep. 30, 2013
|Investments and Fair Value Measurements||
4. INVESTMENTS AND FAIR VALUE MEASUREMENTS
Investments include $84 and $1,968 as of September 30, 2013 and December 31, 2012, respectively, representing the Company’s equity method investments in affiliated investment funds which have been established and managed by the Company and its affiliates. The Company’s financial interest in these funds can range up to 2%. Despite the Company’s insignificant financial interest, the Company exercises significant influence over these funds as the Company typically serves as the general partner, managing member or equivalent for these funds. During 2007, the Silvercrest Funds granted rights to the unaffiliated investors in each respective fund to provide that a simple majority of the fund’s unaffiliated investors will have the right, without cause, to remove the general partner or equivalent of that fund or to accelerate the liquidation date of that fund in accordance with certain procedures. At September 30, 2013 and 2012, the Company determined that none of the Silvercrest Funds were required to be consolidated. The Company’s involvement with these entities began on the dates that they were formed, which range from July 2003 to July 2008.
Fair Value Measurements
GAAP establishes a hierarchal disclosure framework which prioritizes and ranks the level of market price observability used in measuring investments at fair value. Market price observability is affected by a number of factors, including the type of investment, the characteristics specific to the investment and the state of the marketplace including the existence and transparency of transactions between market participants. Investments with readily available active quoted prices or for which fair value can be measured from actively quoted prices in an orderly market generally will have a higher degree of market price observability and a lesser degree of judgment used in measuring fair value.
At September 30, 2013, the Company did not have any financial assets or liabilities that are recorded at fair value on a recurring basis.
The following table summarizes the classification of the Company’s financial assets that are recorded at fair value on a recurring basis in the fair value hierarchy as of December 31, 2012:
At September 30, 2013 and December 31, 2012, financial instruments that are not held at fair value are categorized in the table below:
(1) Restricted certificates of deposit and escrow consists of money market funds that are carried at either cost or amortized cost that approximates fair value due to their short-term maturities. The money market funds are valued through the use of quoted market prices, or $1.00, which is generally the net asset value of the funds.
(2) The carrying value of notes payable approximates fair value, which is determined based on interest rates currently available to the Company for similar debt.