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SEC Filings

10-Q
JONES LANG LASALLE INC filed this Form 10-Q on 11/06/2017
Entire Document
 

Recurring Fair Value Measurements
The following table categorizes by level in the fair value hierarchy the estimated fair value of our assets and liabilities measured at fair value on a recurring basis.
 
September 30, 2017
 
December 31, 2016
(in millions)
Level 1
Level 2
Level 3
 
Level 1
Level 2
Level 3
Assets
 
 
 
 
 
 
 
Investments in real estate ventures - fair value
$
45.0



 
43.7



Foreign currency forward contracts receivable

3.0


 

8.7


Warehouse receivables

337.8


 
n/a

n/a

n/a

Deferred compensation plan assets

218.5


 

173.0


Mortgage banking derivative assets


22.8

 


31.4

Total assets at fair value
$
45.0

559.3

22.8

 
43.7

181.7

31.4

Liabilities
 
 
 
 
 
 
 
Foreign currency forward contracts payable
$

11.6


 

22.9


Deferred compensation plan liabilities

208.8


 

169.5


Earn-out liabilities


223.5

 


229.6

Mortgage banking derivative liabilities


11.3

 


15.9

Total liabilities at fair value
$

220.4

234.8

 

192.4

245.5

Investments in Real Estate Ventures
We classify one investment as Level 1 in the fair value hierarchy as quoted prices are readily available. We increase or decrease our investment each reporting period by the change in the fair value of the investment. We report these fair value adjustments in our Condensed Consolidated Statements of Comprehensive Income within Equity earnings from real estate ventures.
Foreign Currency Forward Contracts
We regularly use foreign currency forward contracts to manage our currency exchange rate risk related to intercompany lending and cash management practices. These contracts are on our Condensed Consolidated Balance Sheets as current assets and current liabilities. We determine the fair values of these contracts based on current market rates. The inputs for these valuations are Level 2 inputs in the fair value hierarchy. As of September 30, 2017 and December 31, 2016, these contracts had a gross notional value of $2.00 billion ($1.41 billion on a net basis) and $1.90 billion ($1.39 billion on a net basis), respectively.
The revaluations of foreign currency forward contracts resulted in a net loss of $8.6 million as of September 30, 2017 and no net gain as of September 30, 2016. We recognize gains and losses from revaluation of these contracts as a component of Operating, administrative and other expense. They are offset by the gains and losses we recognize on the revaluation of intercompany loans and other foreign currency balances. The impact to net income was not significant for either of the three or nine months ended September 30, 2017 or 2016.
We record the asset and liability positions for our foreign currency forward contracts based on the net payable or net receivable position with the financial institutions from which we purchase these contracts. The $3.0 million asset as of September 30, 2017, was composed of gross contracts with receivable positions of $5.2 million and payable positions of $2.2 million. The $11.6 million liability as of September 30, 2017, was composed of gross contracts with receivable positions of $1.4 million and payable positions of $13.0 million. As of December 31, 2016, the $8.7 million asset was composed of gross contracts with receivable positions of $8.9 million and payable positions of $0.2 million. The $22.9 million liability as of December 31, 2016, was composed of gross contracts with receivable positions of $1.3 million and payable positions of $24.2 million.

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