SEI INVESTMENTS CO [SEIC] Filings

10-Q 1 seic-20210930.htm FORM 10-Q seic-20210930

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

________________________________________

FORM 10-Q

________________________________________


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2021


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OF 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from_________to ________

Commission File Number: 0-10200

________________________________________

SEI INVESTMENTS COMPANY

(Exact Name of Registrant as Specified in its Charter)

________________________________________


Pennsylvania						23-1707341
(State or Other Jurisdiction of Incorporation or Organization)						(I.R.S. Employer Identification No.)

1 Freedom Valley Drive, Oaks, Pennsylvania 19456-1100

(Address of Principal Executive Offices) (Zip Code)

(610) 676-1000

(Registrant’s Telephone Number, Including Area Code)

N/A

(Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report)

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

Title of each class

Trading Symbol

Name of each exchange on which registered

Common Stock, par value $0.01 per share

SEIC

The NASDAQ Stock Market LLC

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

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No ☐

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

Large accelerated filer

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

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

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

The number of shares outstanding of the registrant’s common stock, as of the close of business on October 21, 2021:


Common Stock, $0.01 par value						139,452,507

SEI INVESTMENTS COMPANY

TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION

Page

Item 1.

Financial Statements.

Consolidated Balance Sheets (Unaudited) -- September 30, 2021 and December 31, 2020

Consolidated Statements of Operations (Unaudited) -- For the Three and Nine Months Ended September 30, 2021 and 2020

Consolidated Statements of Comprehensive Income (Unaudited) -- For the Three and Nine Months Ended September 30, 2021 and 2020

Consolidated Statements of Changes in Equity (Unaudited) -- For the Three and Nine Months Ended September 30, 2021 and 2020

Consolidated Condensed Statements of Cash Flows (Unaudited) -- For the Nine Months Ended September 30, 2021 and 2020

Notes to Consolidated Financial Statements

Item 2.

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

Item 3.

Quantitative and Qualitative Disclosures About Market Risk.

Item 4.

Controls and Procedures.

PART II - OTHER INFORMATION

Item 1.

Legal Proceedings.

Item 1A.

Risk Factors.

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds.

Item 6.

Exhibits.

Signatures

PART I. FINANCIAL INFORMATION

Item 1. Consolidated Financial Statements.

SEI Investments Company

Consolidated Balance Sheets

(unaudited)

(In thousands, except par value)


	September 30, 2021		December 31, 2020
Assets
Current Assets:
Cash and cash equivalents	$	793,883	$	784,626
Restricted cash	351		3,101
Receivables from investment products	59,808		55,271
Receivables, net of allowance for doubtful accounts of $2,669 and $1,100	442,187		385,219
Securities owned	31,770		34,064
Other current assets	42,615		38,696
Total Current Assets	1,370,614		1,300,977
Property and Equipment, net of accumulated depreciation of $400,679 and $378,639	183,802		189,052
Operating Lease Right-of-Use Assets	35,145		38,397
Capitalized Software, net of accumulated amortization of $531,923 and $491,739	250,280		270,977
Available for Sale and Equity Securities	140,079		105,419
Investments in Affiliated Funds, at fair value	6,893		6,166
Investment in Unconsolidated Affiliate	39,872		98,433
Goodwill	64,489		64,489
Intangible Assets, net of accumulated amortization of $15,768 and $12,456	31,992		24,304
Deferred Contract Costs	34,263		33,781
Deferred Income Taxes	2,148		2,972
Other Assets, net	32,224		32,289
Total Assets	$	2,191,801	$	2,167,256

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

SEI Investments Company

Consolidated Balance Sheets

(unaudited)

(In thousands, except par value)


	September 30, 2021		December 31, 2020
Liabilities and Equity
Current Liabilities:
Accounts payable	$	10,772	$	7,766
Accrued liabilities	231,043		299,845
Current portion of long-term operating lease liabilities	10,412		8,579
Deferred revenue	1,235		1,085
Total Current Liabilities	253,462		317,275
Long-term Income Taxes Payable	803		803
Deferred Income Taxes	47,434		55,159
Long-term Operating Lease Liabilities	29,857		34,058
Other Long-term Liabilities	22,157		20,054
Total Liabilities	353,713		427,349
Commitments and Contingencies
Shareholders' Equity:
Common stock, $0.01 par value, 750,000 shares authorized; 139,305 and 143,396 shares issued and outstanding	1,393		1,434
Capital in excess of par value	1,228,085		1,190,001
Retained earnings	629,153		565,270
Accumulated other comprehensive loss, net	(20,543)		(16,798)
Total Shareholders' Equity	1,838,088		1,739,907
Total Liabilities and Shareholders' Equity	$	2,191,801	$	2,167,256

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

SEI Investments Company

Consolidated Statements of Operations

(unaudited)

(In thousands, except per share data)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Revenues:
Asset management, administration and distribution fees	$	393,296	$	339,609	$	1,143,451	$	992,039
Information processing and software servicing fees	92,026		85,318		273,208		248,296
Total revenues	485,322		424,927		1,416,659		1,240,335
Expenses:
Subadvisory, distribution and other asset management costs	55,619		45,126		161,610		134,645
Software royalties and other information processing costs	7,348		6,992		20,561		21,828
Compensation, benefits and other personnel	150,188		134,795		429,188		391,607
Stock-based compensation	11,318		6,467		31,173		20,458
Consulting, outsourcing and professional fees	55,868		57,949		165,657		168,350
Data processing and computer related	26,650		24,437		79,746		71,647
Facilities, supplies and other costs	14,124		16,679		49,851		47,448
Amortization	14,674		13,200		43,749		39,417
Depreciation	8,408		7,945		25,141		23,058
Total expenses	344,197		313,590		1,006,676		918,458
Income from operations	141,125		111,337		409,983		321,877
Net (loss) gain from investments	(575)		776		134		(1,310)
Interest and dividend income	892		1,009		2,715		5,582
Interest expense	(101)		(153)		(354)		(456)
Equity in earnings of unconsolidated affiliate	35,005		28,305		103,420		86,488
Income before income taxes	176,346		141,274		515,898		412,181
Income taxes	38,301		30,178		114,605		90,777
Net income	$	138,045	$	111,096	$	401,293	$	321,404
Basic earnings per common share	$	0.98	$	0.76	$	2.83	$	2.18
Shares used to compute basic earnings per share	140,507		145,812		141,928		147,586
Diluted earnings per common share	$	0.97	$	0.75	$	2.79	$	2.14
Shares used to compute diluted earnings per share	142,426		147,907		143,981		149,958
Dividends declared per common share	$	—	$	—	$	0.37	$	0.35

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

SEI Investments Company

Consolidated Statements of Comprehensive Income

(unaudited)

(In thousands)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Net income	$	138,045	$	111,096	$	401,293	$	321,404
Other comprehensive (loss) income, net of tax:
Foreign currency translation adjustments	(5,546)		7,085		(2,867)		(5,051)
Unrealized (loss) gain on investments:
Unrealized (losses) gains during the period, net of income taxes of $208, $154, $453 and $(218)	(713)		(542)		(1,548)		702
Reclassification adjustment for losses realized in net income, net of income taxes of $(67), $(63), $(190) and $(126)	238		238		670		455
Total other comprehensive (loss) income, net of tax	(6,021)		6,781		(3,745)		(3,894)
Comprehensive income	$	132,024	$	117,877	$	397,548	$	317,510

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

SEI Investments Company

Consolidated Statements of Changes in Equity

(unaudited)

(In thousands)


	Shares of Common Stock	Common Stock		Capital In Excess of Par Value		Retained Earnings		Accumulated Other Comprehensive Loss		Total Equity
	For the Three Months Ended September 30, 2021
Balance, July 1, 2021	141,027	$	1,410	$	1,219,487	$	599,231	$	(14,522)	$	1,805,606
Net income	—	—		—		138,045		—		138,045
Other comprehensive loss	—	—		—		—		(6,021)		(6,021)
Purchase and retirement of common stock	(1,980)	(21)		(11,751)		(108,123)		—		(119,895)
Issuance of common stock under employee stock purchase plan	22	1		1,119		—		—		1,120
Issuance of common stock upon exercise of stock options	236	3		7,912		—		—		7,915
Stock-based compensation	—	—		11,318		—		—		11,318

Balance, September 30, 2021	139,305	$	1,393	$	1,228,085	$	629,153	$	(20,543)	$	1,838,088


	Shares of Common Stock	Common Stock		Capital In Excess of Par Value		Retained Earnings		Accumulated Other Comprehensive Loss		Total Equity
	For the Three Months Ended September 30, 2020
Balance, July 1, 2020	146,445	$	1,464	$	1,174,411	$	566,929	$	(34,179)	$	1,708,625
Net income	—	—		—		111,096		—		111,096
Other comprehensive income	—	—		—		—		6,781		6,781
Purchase and retirement of common stock	(2,110)	(22)		(11,939)		(96,781)		—		(108,742)
Issuance of common stock under employee stock purchase plan	26	1		1,152		—		—		1,153
Issuance of common stock upon exercise of stock options	130	2		4,051		—		—		4,053
Stock-based compensation	—	—		6,467		—		—		6,467

Balance, September 30, 2020	144,491	$	1,445	$	1,174,142	$	581,244	$	(27,398)	$	1,729,433

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

SEI Investments Company

Consolidated Statements of Changes in Equity

(unaudited)

(In thousands)



	Shares of Common Stock	Common Stock		Capital In Excess of Par Value		Retained Earnings		Accumulated Other Comprehensive Loss		Total Equity
	For the Nine Months Ended September 30, 2021
Balance, January 1, 2021	143,396	$	1,434	$	1,190,001	$	565,270	$	(16,798)	$	1,739,907
Net income	—	—		—		401,293		—		401,293
Other comprehensive loss	—	—		—		—		(3,745)		(3,745)
Purchase and retirement of common stock	(5,218)	(53)		(30,979)		(285,021)		—		(316,053)
Issuance of common stock under employee stock purchase plan	64	1		3,224		—		—		3,225
Issuance of common stock upon exercise of stock options	1,063	11		34,666		—		—		34,677
Stock-based compensation	—	—		31,173		—		—		31,173
Dividends declared ($0.37 per share)	—	—		—		(52,389)		—		(52,389)
Balance, September 30, 2021	139,305	$	1,393	$	1,228,085	$	629,153	$	(20,543)	$	1,838,088



	Shares of Common Stock	Common Stock		Capital In Excess of Par Value		Retained Earnings		Accumulated Other Comprehensive Loss		Total Equity
	For the Nine Months Ended September 30, 2020
Balance, January 1, 2020	149,745	$	1,497	$	1,158,900	$	601,885	$	(23,504)	$	1,738,778
Net income	—	—		—		321,404		—		321,404
Other comprehensive loss	—	—		—		—		(3,894)		(3,894)
Purchase and retirement of common stock	(6,185)	(62)		(34,999)		(290,583)		—		(325,644)
Issuance of common stock under employee stock purchase plan	73	1		3,400		—		—		3,401
Issuance of common stock upon exercise of stock options	858	9		26,383		—		—		26,392
Stock-based compensation	—	—		20,458		—		—		20,458
Dividends declared ($0.35 per share)	—	—		—		(51,462)		—		(51,462)
Balance, September 30, 2020	144,491	$	1,445	$	1,174,142	$	581,244	$	(27,398)	$	1,729,433

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

SEI Investments Company

Consolidated Condensed Statements of Cash Flows

(unaudited)

(In thousands)


	Nine Months Ended September 30,
	2021		2020
Cash flows from operating activities:
Net income	$	401,293	$	321,404
Adjustments to reconcile net income to net cash provided by operating activities (See Note 1)	82,588		75,120
Net cash provided by operating activities	483,881		396,524
Cash flows from investing activities:
Additions to property and equipment	(22,520)		(43,113)
Additions to capitalized software	(19,486)		(18,640)
Purchases of marketable securities	(168,333)		(114,407)
Prepayments and maturities of marketable securities	133,895		112,575
Sales of marketable securities	327		842
Other investing activities	(11,425)		(1,500)
Net cash used in investing activities	(87,542)		(64,243)
Cash flows from financing activities:
Payment of contingent consideration	(3,965)		(633)
Purchase and retirement of common stock	(315,811)		(327,079)
Proceeds from issuance of common stock	37,902		29,793
Payment of dividends	(105,516)		(103,914)
Net cash used in financing activities	(387,390)		(401,833)
Effect of exchange rate changes on cash, cash equivalents and restricted cash	(2,442)		(4,196)
Net increase (decrease) in cash, cash equivalents and restricted cash	6,507		(73,748)
Cash, cash equivalents and restricted cash, beginning of period	787,727		844,547
Cash, cash equivalents and restricted cash, end of period	$	794,234	$	770,799

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

Notes to Consolidated Financial Statements

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

Note 1. Summary of Significant Accounting Policies

Nature of Operations

SEI Investments Company (the Company), a Pennsylvania corporation, provides comprehensive platforms, services and infrastructure—encompassing technology, operational, and investment management services—to help wealth managers, financial advisors, investment managers, family offices, institutional and private investors create and manage wealth.

Investment processing platforms provide technologies and business process outsourcing services for wealth managers and investment advisors. These solutions include investment advisory, client relationship, and other technology-enabled capabilities for the front office; administrative and investment services for the middle office; and accounting and processing services for the back office. Revenues from investment processing platforms are recognized in Information processing and software servicing fees on the accompanying Consolidated Statements of Operations.

Investment operations platforms provide business process outsourcing services for investment managers and asset owners. These platforms support a broad range of traditional and alternative investments and provide technology-enabled information analytics and investor capabilities for the front office; administrative and investment services for the middle office; and fund administration and accounting services for the back office. Revenues from investment operations platforms are recognized in Asset management, administration and distribution fees on the accompanying Consolidated Statements of Operations.

Investment management platforms provide comprehensive solutions for managing personal and institutional wealth. These platforms include goals-based investment strategies; SEI-sponsored investment products, including mutual funds, collective investment products, alternative investment portfolios and separately managed accounts (SMA); and other market-specific advice, technology and operational components. These platforms are offered to wealth managers as part of a complete goals-based investment program for their end-investors. For institutional investors, the Company provides Outsourced Chief Investment Officer (OCIO) solutions that include investment management programs, as well as advisory and administrative services. Revenues from investment management platforms are recognized in Asset management, administration and distribution fees on the accompanying Consolidated Statements of Operations.

Basis of Presentation

The accompanying Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America. Certain financial information and accompanying note disclosure normally included in the Company’s Annual Report on Form 10-K have been condensed or omitted. The interim financial information is unaudited but reflects all adjustments (consisting of only normal recurring adjustments) which are, in the opinion of management, necessary for a fair statement of financial position of the Company as of September 30, 2021, the results of operations for the three and nine months ended September 30, 2021 and 2020, and cash flows for the nine-months ended September 30, 2021 and 2020. These interim Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and the Notes to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020.

There have been no significant changes in significant accounting policies during the nine months ended September 30, 2021 as compared to the significant accounting policies described in the Company's Annual Report on Form 10-K for the year ended December 31, 2020.

Variable Interest Entities

The Company or its affiliates have created numerous investment products for its clients in various types of legal entity structures. The Company serves as the Manager, Administrator and Distributor for these investment products and may also serve as the Trustee for some of the investment products. The Company receives asset management, distribution, administration and custodial fees for these services. Clients are the equity investors and participate in proportion to their ownership percentage in the net income or loss and net capital gains or losses of the products, and, on liquidation, will participate in proportion to their ownership percentage in the remaining net assets of the products after satisfaction of outstanding liabilities. The Company has concluded that it is not the primary beneficiary of the entities and, therefore, is not required to consolidate any of the pooled investment vehicles for which it receives asset management, distribution, administration and custodial fees under the VIE model.

The Company is a party to expense limitation agreements with certain SEI-sponsored money market funds subject to Rule 2a-7 of the Investment Company Act of 1940 which establish a maximum level of ordinary operating expenses incurred by the fund in any fiscal year including, but not limited to, fees of the administrator or its affiliates. Under the terms of these

agreements, the Company waived $11,629 and $8,575 in fees during the three months ended September 30, 2021 and 2020, respectively. During the nine months ended September 30, 2021 and 2020, the Company waived $33,118 and $24,930, respectively, in fees.

Revenue Recognition

Revenue is recognized when the transfer of control of promised goods or services under the terms of a contract with customers are satisfied in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those promised goods or services. Certain portions of the Company’s revenues involve a third party in providing goods or services to its customers. In such circumstances, the Company must determine whether the nature of its promise to the customer is to provide the underlying goods or services (the Company is the principal in the transaction and reports the transaction gross) or to arrange for a third party to provide the underlying goods or services (the entity is the agent in the transaction and reports the transaction net). See Note 13 for related disclosures regarding revenue recognition.

Cash and Cash Equivalents

Cash and cash equivalents includes $332,657 and $347,082 at September 30, 2021 and December 31, 2020, respectively, primarily invested in SEI-sponsored open-ended money market mutual funds.

Restricted Cash

Restricted cash includes $250 and $3,000 at September 30, 2021 and December 31, 2020, respectively, segregated for regulatory purposes related to trade-execution services conducted by SEI Investments (Europe) Limited. Restricted cash also includes $101 at September 30, 2021 and December 31, 2020 segregated in special reserve accounts for the benefit of customers of the Company’s broker-dealer subsidiary, SEI Investments Distribution Co. (SIDCO), in accordance with certain rules established by the Securities and Exchange Commission (SEC) for broker-dealers.

Capitalized Software

The Company capitalized $19,486 and $18,640 of software development costs during the nine months ended September 30, 2021 and 2020, respectively. The Company's software development costs primarily relate to significant enhancements to the SEI Wealth PlatformSM (SWP). The Company capitalized $19,387 and $17,208 of software development costs for significant enhancements to SWP during the nine months ended September 30, 2021 and 2020, respectively. As of September 30, 2021, the net book value of SWP was $241,262. The net book value includes $22,702 of capitalized software development costs in-progress associated with future releases of SWP. Capitalized software development costs in-progress associated with future releases of SWP were $13,409 as of December 31, 2020. SWP has a weighted average remaining life of 10.0 years. Amortization expense for SWP was $35,834 and $32,576 during the nine months ended September 30, 2021 and 2020, respectively.

Earnings per Share

The calculations of basic and diluted earnings per share for the three and nine months ended September 30, 2021 and 2020 are:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Net income	$	138,045	$	111,096	$	401,293	$	321,404
Shares used to compute basic earnings per common share	140,507,000		145,812,000		141,928,000		147,586,000
Dilutive effect of stock options	1,919,000		2,095,000		2,053,000		2,372,000
Shares used to compute diluted earnings per common share	142,426,000		147,907,000		143,981,000		149,958,000
Basic earnings per common share	$	0.98	$	0.76	$	2.83	$	2.18
Diluted earnings per common share	$	0.97	$	0.75	$	2.79	$	2.14

During the three months ended September 30, 2021 and 2020, employee stock options to purchase 11,347,000 and 8,813,000 shares of common stock with an average exercise price of $57.80 and $57.98, respectively, were outstanding but not included in the computation of diluted earnings per common share. During the nine months ended September 30, 2021 and 2020, employee stock options to purchase 11,531,000 and 8,342,000 shares of common stock with an average exercise price of $57.78 and $58.18, respectively, were outstanding but not included in the computation of diluted earnings per common share. These options for the three and nine month periods were not included in the computation of diluted earnings per common share because either the performance conditions have not been satisfied or would not have been satisfied if the reporting date was the end of the contingency period or the options' exercise price was greater than

the average market price of the Company’s common stock and the effect on diluted earnings per common share would have been anti-dilutive.

Reclassifications

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

Statements of Cash Flows

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

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


	2021		2020
Net income	$	401,293	$	321,404
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation	25,141		23,058
Amortization	43,749		39,417
Equity in earnings of unconsolidated affiliate	(103,420)		(86,488)
Distributions received from unconsolidated affiliate	110,559		107,180
Stock-based compensation	31,173		20,458
Provision for losses on receivables	1,569		109
Deferred income tax expense	(6,639)		(7,731)
Net (gain) loss from investments	(134)		1,310

Change in other long-term liabilities	2,103		(4,442)
Change in other assets	314		(965)
Contract costs capitalized, net of amortization	(482)		(2,842)
Other	921		(1,053)
Change in current assets and liabilities
(Increase) decrease in
Receivables from investment products	(4,537)		2,521
Receivables	(58,537)		(37,921)
Other current assets	(3,919)		(6,186)
Advances due from unconsolidated affiliate	51,422		12,641
(Decrease) increase in
Accounts payable	3,006		8,615
Accrued liabilities	(9,851)		8,809
Deferred revenue	150		(1,370)
Total adjustments	82,588		75,120
Net cash provided by operating activities	$	483,881	$	396,524

Note 2. Investment in Unconsolidated Affiliate

LSV Asset Management

The Company has an investment in LSV Asset Management (LSV), a registered investment advisor that provides investment advisory services primarily to institutions, including pension plans and investment companies. LSV is currently an investment sub-advisor for a limited number of SEI-sponsored investment products. The Company's partnership interest in LSV as of September 30, 2021 was 38.7%. The Company accounts for its interest in LSV using the equity method because of its less than 50% ownership. The Company’s interest in the net assets of LSV is reflected in Investment in unconsolidated affiliate on the accompanying Consolidated Balance Sheets and its interest in the earnings of LSV is reflected in Equity in earnings of unconsolidated affiliate on the accompanying Consolidated Statements of Operations.

At September 30, 2021, the Company’s total investment in LSV was $39,872. The Company receives partnership distributions from LSV on a quarterly basis. The Company received partnership distributions from LSV of $110,559 and $107,180 in the nine months ended September 30, 2021 and 2020, respectively. As such, the Company considers these distribution payments as returns on investment rather than returns of the Company's original investment in LSV and has therefore classified the associated cash inflows as an operating activity on the Consolidated Statements of Cash Flows.

The Company’s proportionate share in the earnings of LSV was $35,005 and $28,305 during the three months ended September 30, 2021 and 2020, respectively. During the nine months ended September 30, 2021 and 2020, the Company's proportionate share in the earnings of LSV was $103,420 and $86,488, respectively.

These tables contain condensed financial information of LSV:


Condensed Statement of Operations	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Revenues	$	115,728	$	94,902	$	342,957	$	289,546
Net income	90,365		70,440		266,805		220,184


Condensed Balance Sheets	September 30, 2021		December 31, 2020
Current assets	$	123,325	$	151,515
Non-current assets	4,426		4,296
Total assets	$	127,751	$	155,811

Current liabilities	$	69,349	$	77,077
Non-current liabilities	4,058		4,620
Partners’ capital	54,344		74,114
Total liabilities and partners’ capital	$	127,751	$	155,811

On April 1, 2021, LSV provided an interest in the partnership to select key employees which reduced the ownership percentage of each existing partner on a pro-rata basis. As a result, the Company's total partnership interest in LSV was reduced slightly to approximately 38.7% from approximately 38.8%.

Note 3. Composition of Certain Financial Statement Captions

Receivables

Receivables on the accompanying Consolidated Balance Sheets consist of:


	September 30, 2021		December 31, 2020
Trade receivables	$	112,572	$	99,106
Fees earned, not billed	313,883		262,167
Other receivables	18,401		25,046
	444,856		386,319
Less: Allowance for doubtful accounts	(2,669)		(1,100)
	$	442,187	$	385,219

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

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

Property and Equipment

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


	September 30, 2021		December 31, 2020
Buildings	$	209,315	$	206,151
Equipment	150,945		141,820
Land	24,651		24,179
Purchased software	156,327		147,838
Furniture and fixtures	21,196		21,439
Leasehold improvements	21,838		21,604
Construction in progress	209		4,660
	584,481		567,691
Less: Accumulated depreciation	(400,679)		(378,639)
Property and Equipment, net	$	183,802	$	189,052