Table	of	Contents

# UNITED	STATES

# SECURITIES	AND	EXCHANGE	COMMISSION

(Mark	One)

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

For	the	fiscal	year	ended	December	31,	2013

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

# BlackRock,	Inc.

(Exact	name	of	registrant	as	specified	in	its	charter)

Delaware

(State	or	Other	Jurisdiction	of Incorporation	or	Organization)

(I.R.S.	Employer Identification	No.)

(Address	of	Principal	Executive	Offices)

(Registrant's	telephone	number,	including	area	code)

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

Title	of	each	class

Common	Stock,	$.01	par	value

Name	of	each	exchange	on	which	registered

New	York	Stock	Exchange

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

Indicate	by	check	mark	if	the	registrant	is	a	well-known,	seasoned	issuer,	as	defined	in	Rule	405	of	the	Securities	Act.				Yes		x				No		¨

Indicate	by	check	mark	if	the	registrant	is	not	required	to	file	reports	pursuant	to	Section	13	or	Section	15(d)	of	the	Act.				Yes		¨				No		x

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	and	posted	on	its	corporate	Web	site,	if	any,	every	Interactive	Data	File	required	to	be submitted	and	posted	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	and	post	such	files).				Yes		x				No		¨

Indicate	by	check	mark	if	disclosure	of	delinquent	filers	pursuant	to	Item	405	of	Regulation	S-K	(§	229.405	of	this	chapter)	is	not	contained	herein,	and	will	not	be contained,	to	the	best	of	the	registrant's	knowledge,	in	definitive	proxy	or	information	statements	incorporated	by	reference	in	Part	III	of	this	Form	10-K	or	any amendment	to	this	Form	10-K.				x

Indicate	by	check	mark	whether	the	registrant	is	a	large	accelerated	filer,	an	accelerated	filer,	a	non-accelerated	filer,	or	a	smaller	reporting	company.	See	the

definitions	of	"large	accelerated	filer,"	"accelerated	filer"	and	"smaller	reporting	company"	in	Rule	12b-2	of	the	Exchange	Act.	(Check	one)

Large	accelerated	filer 	 x

Non-accelerated	filer 	 ¨		(Do	not	check	if	a	smaller	reporting	company)

		Accelerated	filer

Smaller	reporting	company	 ¨

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

The	aggregate	market	value	of	the	voting	common	stock	and	nonvoting	common	stock	equivalents	held	by	nonaffiliates	of	the	registrant	as	of	June	30,	2013	was approximately	$42.8	billion.

# DOCUMENTS	INCORPORATED	BY	REFERENCE

The	following	documents	are	incorporated	by	reference	herein:

Portions	of	the	definitive	Proxy	Statement	of	BlackRock,	Inc.	to	be	filed	pursuant	to	Regulation	14A	of	the	general	rules	and	regulations	under	the	Securities	Exchange Act	of	1934,	as	amended,	for	the	2014	annual	meeting	of	stockholders	to	be	held	on	May	29,	2014	("Proxy	Statement")	are	incorporated	by	reference	into	Part	III	of	this Form	10-K.

# PART	I

# PART	IV

# Item	1.	Business

# OVERVIEW

BlackRock,	Inc.	(NYSE:	BLK;	together,	with	its	subsidiaries,	unless	the	context otherwise	indicates,	"BlackRock"	or	the	"Company")	is	the	world's	largest	publicly	traded investment	management	firm	with	employees	in	more	than	30	countries	who	serve clients	in	over	100	countries	across	the	globe.	We	provide	a	broad	range	of	investment and	risk	management	services	and	had	$4.324	trillion	of	assets	under	management ("AUM")	at	December	31,	2013.	Our	clients	include	retail,	including	high	net	worth,	and institutional	investors,	comprised	of	pension	funds,	official	institutions,	endowments, insurance	companies,	corporations,	financial	institutions,	central	banks	and	sovereign wealth	funds.	The	Company	is	highly	regulated	and	serves	its	clients	as	a	fiduciary.	We do	not	engage	in	proprietary	trading	activities	that	could	conflict	with	the	interests	of	our clients.

Our	unique	platform	enables	us	to	offer	active	and	passive	products	and	risk management	capabilities	to	develop	tailored	solutions	for	clients.	Our	product	range includes	single-	and	multi-asset	portfolios	investing	in	equities,	fixed	income, alternatives	and/or	money	market	instruments.	We	offer	our	products	directly	and through	intermediaries	in	a	variety	of	vehicles,	including	open-end	and	closed-end mutual	funds,	iShares®	exchange-traded	funds	("ETFs")	and	other	exchange-traded products	(together	with	ETFs,	"ETPs"),	collective	investment	funds	and	separate accounts.	We	also	offer	our	BlackRock	Solutions®	("BRS")	risk	management	and advisory	services	primarily	to	institutional	investors.

BlackRock	is	an	independent,	publicly	traded	company,	with	no	single	majority shareholder	and	over	two-thirds	of	its	Board	of	Directors	consisting	of	independent directors.	At	December	31,	2013,	The	PNC	Financial	Services	Group,	Inc.	("PNC")	held 20.9%	of	BlackRock's	voting	common	stock	and	21.9%	of	BlackRock's	capital	stock, which	includes	outstanding	common	stock	and	nonvoting	preferred	stock.

Management	seeks	to	achieve	attractive	returns	for	stockholders	over	time	by,	among other	things,	capitalizing	on	the	following	factors:

•	the	Company's	diversified	active	and	passive	product	offerings,	which	enhance	its ability	to	offer	a	variety	of	traditional	and	alternative	investment	products	across the	risk	spectrum	and	to	tailor	single-	and	multi-asset	investment	solutions	to address	specific	client	needs;

•	the	Company's	focus	on	strong	performance	providing	alpha	for	active	products and	limited	or	no	tracking	error	for	passive	products;

•	the	Company's	longstanding	commitment	to	risk	management	and	the	continued development	of,	and	increased	interest	in,	BRS	products	and	services;

•	the	Company's	positioning	in	the	face	of	macro	challenges	driving	trends	in investor	behavior,	including	the	secular	shift	to	passive	investing	and	ETPs,	a focus	on	income	and	retirement,	and	barbelling	of	risk	using	passive	and	active products,	including	alternatives;

•	the	Company's	global	presence	and	commitment	to	best	practices	around	the world,	with	approximately	48%	of	employees	outside	the	United	States	supporting local	investment	capabilities	and	serving	clients,	and	approximately	44%	of	total AUM	managed	for	clients	domiciled	outside	the	United	States;	and

•	the	growing	recognition	of	the	global	BlackRock	brand,	and	the	depth	and	breadth of	the	Company's	intellectual	capital.

BlackRock	operates	in	a	global	marketplace	characterized	by	a	high	degree	of	market volatility	and	economic	uncertainty,	factors	that	can	significantly	affect	earnings	and stockholder	returns	in	any	given	period.

The	Company's	ability	to	increase	revenue,	earnings	and	stockholder	value	over	time	is predicated	on	its	ability	to	generate	new	business,	including	business	in	BRS	products and	services.	New	business	efforts	are	dependent	on	BlackRock's	ability	to	achieve clients'	investment	objectives	in	a	manner	consistent	with	their	risk	preferences	and	to deliver	excellent	client	service.	All	of	these	efforts	require	the	commitment	and contributions	of	BlackRock	employees.	Accordingly,	the	ability	to	attract,	develop	and retain	talented	professionals	is	critical	to	the	Company's	long-term	success.

# FINANCIAL	HIGHLIGHTS

|  |  |  |  |  |  |  | 5-Year |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| (in\tmillions,\texcept\tper\tshare\tdata) | 2013 | 2012 | 2011 | 2010 | 2009 | 2008 | CAGR(4) |
| Total\trevenue | $\t10,180 | $\t9,337 | $\t9,081 | $\t8,612 | $\t4,700 | $\t5,064 | 15% |
| Operating\tincome | $3,857 | $ 3,524 | $ 3,249 | $ 2,998 | $ 1,278 | $1,593 | 19% |
| Operating\tmargin | 37.9% | 37.7% | 35.8% | 34.8% | 27.2% | 31.5% | 4% |
| Nonoperating\tincome\t(expense)(1) | $97 | $(36) | $(116) | $36 | $(28) | $(422) | (175%) |
| Net\tincome\tattributable\tto\tBlackRock,\tInc. | $2,932 | $ 2,458 | $ 2,337 | $ 2,063 | $875 | $784 | 30% |
| Diluted\tearnings\tper\tcommon\tshare | $16.87 | $ 13.79 | $ 12.37 | $ 10.55 | $6.11 | $5.78 | 24% |

|  |  |  |  |  |  |  | 5-Year |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| (in\tmillions,\texcept\tper\tshare\tdata) | 2013 | 2012 | 2011 | 2010 | 2009 | 2008 | CAGR(4) |
| As\tadjusted(2): |  |  |  |  |  |  |  |
| Operating\tincome | $\t\t\t4,024 | $\t3,574 | $\t3,392 | $\t3,167 | $\t1,570 | $\t1,662 | 19% |
| Operating\tmargin(3) | 41.4% | 40.4% | 39.7% | 39.3% | 38.2% | 38.7% | 1% |
| Nonoperating\tincome\t(expense)(1) | $7 | $(42) | $(113) | $25 | $(46) | $(384) | (145%) |
| Net\tincome\tattributable\tto\tBlackRock,\tInc. | $2,882 | $ 2,438 | $ 2,239 | $ 2,139 | $ 1,021 | $856 | 27% |
| Diluted\tearnings\tper\tcommon\tshare | $16.58 | $ 13.68 | $ 11.85 | $ 10.94 | $7.13 | $6.30 | 21% |

(1) Net	of	net	income	(loss)	attributable	to	noncontrolling	interests	("NCI")	(redeemable	and	nonredeemable).

(2) BlackRock	reports	its	financial	results	in	accordance	with	accounting	principles	generally	accepted	in	the	United	States	("GAAP");	however,	management	believes	evaluating	the	Company's	ongoing	operating	results may	be	enhanced	if	investors	have	additional	non-GAAP	basis	financial	measures.	Management	reviews	non-GAAP	financial	measures	to	assess	ongoing	operations	and,	for	the	reasons	described	below,	considers them	to	be	effective	indicators,	for	both	management	and	investors,	of	BlackRock's	financial	performance	over	time.	BlackRock's	management	does	not	advocate	that	investors	consider	such	non-GAAP	financial measures	in	isolation	from,	or	as	a	substitute	for,	financial	information	prepared	in	accordance	with	GAAP.	GAAP	reported	results	include	certain	significant	items,	the	after-tax	impact	of	which	management	deems nonrecurring,	recurring	infrequently	or	transactions	that	ultimately	will	not	impact	BlackRock's	book	value	and,	therefore,	are	excluded	in	calculating	as	adjusted	results.

See	reconciliation	to	GAAP	measures	in	Item	7,	Management's	Discussion	and	Analysis	of	Financial	Condition	and	Results	of	Operations	—	Non-GAAP	Financial	Measures,	for	further	information	on	as	adjusted	items for	2013,	2012	and	2011.	Operating	income,	as	adjusted,	for	2009	excluded	certain	expenses	incurred	related	to	the	integration	of	the	acquisition	of	Barclays	Global	Investors	("BGI"),	as	well	as	advisory	fees,	legal fees	and	consulting	transaction	expenses	related	to	the	acquisition	of	BGI	from	Barclays	on	December	1,	2009	(the	"BGI	Transaction"),	and	restructuring	charges.	Operating	income,	as	adjusted,	for	2008	excluded restructuring	charges.	The	portion	of	compensation	expense	associated	with	certain	long-term	incentive	plans	("LTIP")	funded	or	to	be	funded	through	share	distributions	to	participants	of	BlackRock	stock	held	by	PNC and	a	Merrill	Lynch	cash	compensation	contribution	has	also	been	excluded	because	these	charges	do	not	impact	BlackRock's	book	value.	Compensation	expense	associated	with	appreciation	(depreciation)	on investments	related	to	certain	BlackRock	deferred	compensation	plans	has	been	excluded	from	operating	and	nonoperating	income,	as	adjusted,	as	returns	on	investments	set	aside	for	these	plans,	which	substantially offset	this	expense,	are	reported	in	nonoperating	income	(expense).

(3) Operating	income	used	for	measuring	operating	margin,	as	adjusted,	is	equal	to	operating	income,	as	adjusted,	excluding	the	impact	of	closed-end	fund	launch	costs	and	related	commissions.	Management	believes the	exclusion	of	such	costs	and	related	commissions	is	useful	because	these	costs	can	fluctuate	considerably	and	revenues	associated	with	the	expenditure	of	these	costs	will	not	fully	impact	the	Company's	results until	future	periods.	Revenue	used	for	operating	margin,	as	adjusted,	excludes	distribution	and	servicing	costs	paid	to	related	parties	and	other	third	parties.	Management	believes	the	exclusion	of	such	costs	is	useful because	it	creates	consistency	in	the	treatment	for	certain	contracts	for	similar	services,	which	due	to	the	terms	of	the	contacts,	are	accounted	for	under	GAAP	on	a	net	basis	within	investment	advisory,	administration fees	and	securities	lending	revenue.	Amortization	of	deferred	sales	commissions	is	excluded	from	revenue	used	for	operating	margin	measurement,	as	adjusted,	because	such	costs,	over	time,	substantially	offset distribution	fee	revenue	the	Company	earns.	In	addition,	in	2008,	revenue	used	for	operating	margin,	as	adjusted,	excluded	reimbursable	property	management	compensation,	which	represented	compensation	and benefits	paid	to	personnel	of	Metric	Property	Management,	Inc.	("Metric"),	a	subsidiary	of	BlackRock	Realty	Advisors,	Inc.	("Realty").	Prior	to	the	transfer	in	2008	to	a	third	party,	these	employees	were	retained	on Metric's	payroll	when	certain	properties	were	acquired	by	Realty's	clients.	The	related	compensation	and	benefits	were	fully	reimbursed	by	Realty's	clients	and	have	been	excluded	from	revenue	used	for	operating margin,	as	adjusted,	because	they	did	not	bear	an	economic	cost	to	BlackRock.

Net	income	attributable	to	BlackRock,	Inc.,	as	adjusted,	and	diluted	earnings	per	common	share,	as	adjusted	exclude	the	after-tax	impact	of	the	items	listed	above	and	also	include	the	effect	on	deferred	income	tax expense	attributable	to	changes	in	corporate	income	tax	rates	as	a	result	of	income	tax	law	changes	and	a	state	tax	election.

(4) Percentage	represents	compounded	annual	growth	rate	("CAGR").

# ASSETS	UNDER	MANAGEMENT

A	summary	of	the	Company's	AUM	by	product	type	for	the	years	2008	through	2013	is	presented	below:

| (in	millions) | 2013 | 2012 | 2011 | 2010 | 2009 | 2008 |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| Equity | $2,317,695 | $1,845,501 | $1,560,106 | $1,694,467 | $1,536,055 | $203,292 |
| Fixed\tincome | 1,242,186 | 1,259,322 | 1,247,722 | 1,141,324 | 1,055,627 | 481,365 |
| Multi-asset | 341,214 | 267,748 | 225,170 | 185,587 | 142,029 | 77,516 |
| Alternatives | 111,114 | 109,795 | 104,948 | 109,738 | 102,101 | 61,544 |
| Long-term | 4,012,209 | 3,482,366 | 3,137,946 | 3,131,116 | 2,835,812 | 823,717 |
| Cash\tmanagement | 275,554 | 263,743 | 254,665 | 279,175 | 349,277 | 338,439 |
| Advisory | 36,325 | 45,479 | 120,070 | 150,677 | 161,167 | 144,995 |
| Total | $\t4,324,088 | $\t3,791,588 | $\t3,512,681 | $\t3,560,968 | $\t3,346,256 | $\t1,307,151 |
|  |  |  | Component\tChanges\tin\tAUM\tby\tProduct\tType | Component\tChanges\tin\tAUM\tby\tProduct\tType | Component\tChanges\tin\tAUM\tby\tProduct\tType |  |
|  |  |  | Five\tYears\tEnded\tDecember\t31,\t2013 | Five\tYears\tEnded\tDecember\t31,\t2013 |  |  |
|  |  | Net\tNew | Acquired | Market\t/ |  | 5-Year |

# Component	Changes	in	AUM	by	Product	Type

| (in	millions) | 12/31/2008 | Business | AUM,	net(1) | FX | 12/31/2013 | CAGR |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| Equity | $203,292 | $260,503 | $1,061,801 | $792,099 | $2,317,695 | 63% |
| Fixed\tincome | 481,365 | 17,779 | 502,988 | 240,054 | 1,242,186 | 21% |
| Multi-asset | 77,516 | 139,077 | 45,907 | 78,714 | 341,214 | 35% |
| Alternatives | 61,544 | (19,722) | 68,351 | 941 | 111,114 | 13% |
| Long-term | 823,717 | 397,637 | 1,679,047 | 1,111,808 | 4,012,209 | 37% |
| Cash\tmanagement | 338,439 | (118,341) | 53,616 | 1,840 | 275,554 | (4%) |
| Advisory | 144,995 | \t(112,263) | (10) | 3,603 | 36,325 | (24%) |
| Total | $\t1,307,151 | $167,033 | $\t1,732,653 | $\t1,117,251 | $\t4,324,088 | 27% |

(1) Amounts	include	acquisition	adjustments	and	reclassification	of	certain	AUM	acquired	from	BGI	in	December	2009,	Swiss	Re	Private	Equity	Partners	("SRPEP")	in	September	2012,	Claymore	Investments,	Inc. ("Claymore")	in	March	2012,	Credit	Suisse's	ETF	franchise	("Credit	Suisse	ETF	Transaction")	in	July	2013,	MGPA	in	October	2013	and	other	reclassifications	to	conform	to	current	period	combined	AUM	policy	and presentation.	Amounts	also	include	BGI	merger-related	outflows	due	to	manager	concentration	considerations	prior	to	the	third	quarter	of	2011	and	outflows	from	scientific	active	equity	performance	prior	to	the	second quarter	of	2011.	As	a	result	of	client	investment	manager	concentration	limits	and	the	scientific	active	equity	performance,	outflows	were	expected	to	occur	for	a	period	of	time	subsequent	to	the	close	of	the	transaction.

AUM	represents	the	broad	ranges	of	financial	assets	we	manage	for	clients	on	a discretionary	basis	pursuant	to	investment	management	agreements	that	are	expected to	continue	for	at	least	12	months.	In	general,	reported	AUM	reflects	the	valuation methodology	that	corresponds	to	the	basis	used	for	billing	(for	example,	net	asset value).	Reported	AUM	does	not	include	assets	for	which	we	provide	risk	management or	other	forms	of	non-discretionary	advice,	or	assets	that	we	are	retained	to	manage	on a	short-term,	temporary	basis.

Investment	management	fees	are	typically	expressed	as	a	percentage	of	AUM.	We also	earn	performance	fees	on	certain	portfolios	relative	to	an	agreed-upon	benchmark or	return	hurdle.	On	some	products,	we	also	may	earn	securities	lending	fees.	In addition,	BlackRock	offers	its	proprietary	Aladdin®	investment	system	as	well	as	risk

management,	outsourcing	and	advisory	services,	to	institutional	investors	under	the BRS	name.	Revenue	for	these	services	may	be	based	on	several	criteria	including value	of	positions,	number	of	users,	accomplishment	of	specific	deliverables	or	other objectives.

At	December	31,	2013,	total	AUM	was	$4.324	trillion,	representing	a	CAGR	of	27% over	the	last	five	years.	AUM	growth	during	the	period	was	achieved	through	the combination	of	net	market	valuation	gains,	net	new	business	and	acquisitions,	including BGI,	which	added	approximately	$1.844	trillion	of	AUM	in	December	2009,	Claymore and	SRPEP,	which	added	$13.7	billion	of	AUM	in	2012	and	Credit	Suisse	and	MGPA, which	added	$26.9	billion	of	AUM	in	2013.	These	acquisitions	significantly	changed	our AUM	mix,	from	predominantly	active	fixed	income	and	equity	in	2008	to	a	broadly diversified	product	range,	as	described	below.

The	Company	considers	the	categorization	of	its	AUM	by	client	type,	product	type,	investment	style	and	client	region	useful	to	understanding	its	business.	The	following	discussion	of the	Company's	AUM	will	be	organized	as	follows:

	 ¨	Cash	Management

# CLIENT	TYPE

We	serve	a	diverse	mix	of	institutional	and	retail	investors	worldwide.	Clients	include tax-exempt	institutions,	such	as	defined	benefit	and	defined	contribution	pension	plans, charities,	foundations	and	endowments;	official	institutions,	such	as	central	banks, sovereign	wealth	funds,	supranationals	and	other	government	entities;	taxable institutions,	including	insurance	companies,	financial	institutions,	corporations	and	third- party	fund	sponsors;	and	retail	investors.	iShares	is	presented	as	a	separate	client	type below,	with	investments	in	iShares	by	institutions	and	retail	clients	excluded	from figures	and	discussions	in	their	respective	sections	below.

Our	organizational	structure	was	designed	to	ensure	that	strong	investment performance	is	our	highest	priority,	and	that	we	best	align	with	our	clients'	needs	to capitalize	on	broader	industry	trends.	Furthermore,	our	structure	facilitates	strong teamwork	globally	across	both	functions	and	regions	in	order	to	enhance	our	ability	to leverage	best	practices	to	serve	our	clients	and	continue	to	develop	our	talent.

Specifically,	the	client	side	of	our	business	is	organized	into	two	groups:	one	comprising Retail	and	iShares	and	another	comprising	Institutional	and	BlackRock	Solutions.	The separation	of	the	client	functions	into	these	two	teams	allows	us	to	focus	on	the	unique needs	of	these	client	groups	by	bringing	the	full	capabilities	of	the	firm	to	bear	in	an organized,	cohesive	approach.	Additionally,	our	investments	functions	are	split	into	five distinct	strategies:	Alpha,	Beta,	Multi-Asset,	Alternatives	and	Trading/Liquidity.

|  |  | AUM	by	Investment	Style	&amp;	Client	Type<br>December	31,	2013 | AUM	by	Investment	Style	&amp;	Client	Type<br>December	31,	2013 |  |
| :--- | :--- | :--- | :--- | :--- |
| (in\tmillions) | Retail | iShares | Institutional | Total |
| Active | $458,833 | $— | $932,410 | $1,391,243 |
| Non-ETF\tIndex | 28,944 | — | 1,677,650 | 1,706,594 |
| iShares | — | 914,372 | — | 914,372 |
| Long-term | 487,777 | 914,372 | 2,610,060 | 4,012,209 |
| Cash\tmanagement | 44,327 | — | 231,227 | 275,554 |
| Advisory | 11 | — | 36,314 | 36,325 |
| Total\tAUM | $\t532,115 | $\t914,372 | $\t2,877,601 | $\t4,324,088 |

# Retail	Investors

|  |  | Net	New |  |  |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| (in\tmillions) | 12/31/2012 | Business | Adjustments(1) | Acquisitions(2) | Market\t/\tFX | 12/31/2013 |
| Equity | $164,748 | $3,641 | $13,066 | $— | $21,580 | $203,035 |
| Fixed\tincome | 138,425 | 14,197 | 3,897 | — | (5,044) | 151,475 |
| Multi-asset\tclass | 90,626 | 14,821 | 2,663 | — | 8,944 | 117,054 |
| Alternatives | 9,685 | 6,145 | — | 136 | 247 | 16,213 |
| Long-term\tretail | $\t403,484 | $\t38,804 | $\t19,626 | $\t136 | $\t25,727 | $\t487,777 |

(1) Amounts	include	$19.6	billion	of	AUM	related	to	fund	ranges	reclassed	from	institutional	to	retail.

(2) Amounts	represent	AUM	acquired	in	the	MGPA	acquisition	in	October	2013.

BlackRock	serves	retail	investors	globally	through	separate	accounts,	open-end	and closed-end	funds,	unit	trusts	and	private	investment	funds.	Retail	investors	are	served principally	through	intermediaries,	including	broker-dealers,	banks,	trust	companies, insurance	companies	and	independent	financial	advisors.	Clients	invest	primarily	in mutual	funds,	which	totaled	$402.2	billion,	or	82%,	of	retail	long-term	AUM	at	year-end, with	the	remainder	invested	in	private	investment	funds	and	separately	managed accounts	("SMAs").	The	majority	(94%)	of	long-term	retail	AUM	is	invested	in	active products,	although	this	is	impacted	by	the	fact	that	iShares	is	shown	separately.	Retail represented	12%	of	long-term	AUM	at	December	31,	2013	and	34%	of	long-term	base fees	for	2013.

The	client	base	is	also	diversified	geographically,	with	70%	of	long-term	AUM	managed for	investors	based	in	the	Americas,	24%	in	EMEA	and	6%	in	Asia-Pacific	at	year-end 2013.

•	U.S.	retail	long-term	net	inflows	of	$21.3	billion,	or	7%	organic	growth,	were	driven by	flows	into	income	products,	with	investors'	continued	attraction	to	yield	in

a	low	rate	environment,	and	a	growing	appreciation	for	duration	risk.	Multi-asset class	products	led	flows	with	$10.0	billion	of	net	inflows,	driven	by	demand	for	our flagship	Global	Allocation	and	Multi-Asset	Income	funds.	Fixed	income	net	inflows of	$9.4	billion	reflected	growing	interest	in	unconstrained	fixed	income,	with	our Strategic	Income	Opportunities	fund	raising	$6.9	billion.	Our	suite	of	six	retail alternatives	mutual	funds	continued	to	gain	traction,	raising	$4.6	billion	of	net inflows,	largely	driven	by	our	zero-duration	liquid	Global	Long/Short	Credit	fund. This	range	of	alternatives	mutual	funds	now	stands	at	$5.6	billion	in	AUM,	and	we are	committed	to	broadening	the	distribution	of	alternatives	funds	to	bring institutional-quality	alternatives	products	to	retail	investors.	Net	inflows	across multi-asset	class,	fixed	income	and	alternatives	were	partially	offset	by	equity	net outflows	of	$2.8	billion,	driven	by	historical	performance-related	redemptions	from U.S.	large	cap	equities,	where	we	have	implemented	management	changes	to better	meet	our	high	performance	standards.	As	of	December	31,	2013,	we	are the	leading	U.S.	manager	by	AUM	of	SMAs,

the	second	largest	closed-end	fund	manager	and	a	top-ten	manager	by	AUM	and 2013	net	flows	of	long-term	open-end	mutual	funds1.	In	2013,	we	were	also	the leading	manager	by	net	flows	for	long-dated	fixed	income	mutual	funds1.

•	We	have	fully	integrated	our	legacy	retail	and	iShares	retail	distribution	teams	to create	a	unified	client-facing	presence.	As	retail	clients	increasingly	use BlackRock's	capabilities	in	combination	—	active,	alternative	and	passive	—	it	is	a strategic	priority	for	BlackRock	to	coherently	deliver	these	capabilities	through	one integrated	team.

•	International	retail	long-term	net	inflows	of	$17.5	billion,	representing	15%	organic growth,	were	positive	across	major	regions	and	diversified	across	asset	classes. Equity	net	inflows	of	$6.4	billion	were	driven	by	strong	demand	for	our	top- performing	European	Equities	franchise	as	investor	risk	appetite	for	the	sector improved.	Multi-asset	class	and	fixed	income	products	each	generated	net	inflows of	$4.8	billion,	as	investors	looked	to	manage	duration	and	volatility	in	their portfolios.	In	2013,	we	were	ranked	as	the	third	largest	cross	border	fund provider2.	In	the	United	Kingdom,	we	ranked	among	the	five	largest	fund managers2.

# iShares

|  |  | Component	Changes	in	AUM	—	iShares | Component	Changes	in	AUM	—	iShares |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- |
|  |  | Net\tNew |  |  |  |
| (in\tmillions) | 12/31/2012 | Business | Acquisition(1) | Market\t/\tFX | 12/31/2013 |
| Equity | $534,648 | $74,119 | $13,021 | $96,347 | $718,135 |
| Fixed\tincome | 192,852 | (7,450) | 1,294 | (7,861) | 178,835 |
| Multi-asset\tclass | 869 | 355 | — | 86 | 1,310 |
| Alternatives(2) | 24,337 | (3,053) | 1,645 | (6,837) | 16,092 |
| Total\tiShares | $\t752,706 | $\t63,971 | $\t15,960 | $\t81,735 | $\t914,372 |

(1) Amounts	represent	$16.0	billion	of	AUM	acquired	in	the	Credit	Suisse	ETF	acquisition	in	July	2013.

(2) Amounts	include	commodity	iShares.

iShares	is	the	leading	ETF	provider	in	the	world,	with	$914.4	billion	of	AUM	at December	31,	2013,	and	was	the	top	asset	gatherer	globally	in	20133	with	$64.0	billion of	net	inflows	for	an	organic	growth	rate	of	8%.	Equity	net	inflows	of	$74.1	billion	were driven	by	flows	into	funds	with	broad	developed	market	exposures,	partially	offset	by outflows	from	emerging	markets	products.	iShares	fixed	income	experienced	net outflows	of	$7.5	billion,	as	the	continued	low	interest	rate	environment	led	many liquidity-oriented	investors	to	sell	long-duration	assets,	which	made	up	the	majority	of the	iShares	fixed	income	suite.	In	2013,	we	launched	several	funds	to	meet	demand from	clients	seeking	protection	in	a	rising	interest	rate	environment	by	offering	an expanded	product	set	that	includes	four	new	U.S.	funds,	including	short-duration versions	of	our	flagship	high	yield	and	investment	grade	credit	products,	and	short maturity	and	liquidity	income	funds.	iShares	alternatives	had	$3.1	billion	of	net	outflows predominantly	out	of	commodities.	iShares	represented	23%	of	long-term	AUM	at December	31,	2013	and	35%	of	long-term	base	fees	for	2013.

iShares	offers	the	most	diverse	product	set	in	the	industry	with	703	ETFs	at	year-end 2013,	and	serves	the	broadest	client	base,	covering	more	than	25	countries	on	five continents.	During	2013,	iShares	continued	its	dual	commitment	to	innovation	and responsible	product	structuring	by	introducing	42	new	ETFs,	acquiring	Credit	Suisse's 58	ETFs	in	Europe	and	entering	into	a	critical	new	strategic	alliance	with	Fidelity Investments	to	deliver	Fidelity's	more	than	10	million	clients	increased	access	to

iShares	products,	tools	and	support.	Our	alliance	with	Fidelity	Investments	and	a successful	full	first	year	for	the	Core	Series	have	deeply	expanded	our	presence	and offerings	among	buy-and-hold	investors.	Our	broad	product	range	offers	investors	a precise,	transparent	and	low-cost	way	to	tap	market	returns	and	gain	access	to	a	full range	of	asset	classes	and	global	markets	that	have	been	difficult	or	expensive	for many	investors	to	access	until	now,	as	well	as	the	liquidity	required	to	make adjustments	to	their	exposures	quickly	and	cost-efficiently.

•	U.S.	iShares	AUM	ended	at	$655.6	billion	with	$41.4	billion	of	net	inflows	driven by	strong	demand	for	developed	markets	equities	and	short-duration	fixed income.	During	the	fourth	quarter	of	2012,	we	debuted	the	Core	Series	in	the United	States,	designed	to	provide	the	essential	building	blocks	for	buy-and-hold investors	to	use	in	constructing	the	core	of	their	portfolio.	The	Core	Series demonstrated	solid	results	in	its	first	full	year,	raising	$20.0	billion	in	net	inflows, primarily	in	U.S.	equities.	In	the	United	States,	iShares	maintained	its	position	as the	largest	ETF	provider,	with	39%	share	of	AUM3.

•	International	iShares	AUM	ended	at	$258.8	billion	with	robust	net	new	business	of $22.6	billion	led	by	demand	for	European	and	Japanese	equities,	as	well	as	a diverse	range	of	fixed	income	products.	At	year-end	2013,	iShares	was	the	largest European	ETF	provider	with	48%	of	AUM3.

1 Simfund

2 Lipper	FERI

3 BlackRock;	Bloomberg

# Institutional	Investors

|  |  | Net	New |  |  |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| (in\tmillions) | 12/31/2012 | Business | Adjustments(1) | Acquisition(2) | Market\t/\tFX | 12/31/2013 |
| Active: |  |  |  |  |  |  |
| Equity | $129,024 | $\t(16,504) | $— | $— | $26,206 | $138,726 |
| Fixed\tincome | 518,102 | (3,560) | — | — | (9,433) | 505,109 |
| Multi-asset\tclass | 166,708 | 28,955 | 3,335 | — | 16,278 | 215,276 |
| Alternatives | 70,861 | (9,819) | — | 10,836 | 1,421 | 73,299 |
| Active\tsubtotal | 884,695 | (928) | 3,335 | 10,836 | 34,472 | 932,410 |
| Non-ETF\tIndex: |  |  |  |  |  |  |
| Equity | 1,017,081 | 8,001 | (18,238) | — | 250,955 | 1,257,799 |
| Fixed\tincome | 409,943 | 8,321 | (4,723) | — | (6,774) | 406,767 |
| Multi-asset\tclass | 9,545 | (1,833) | — | — | (138) | 7,574 |
| Alternatives | 4,912 | 777 | — | — | (179) | 5,510 |
| Non-ETF\tIndex\tsubtotal | 1,441,481 | 15,266 | (22,961) | — | 243,864 | 1,677,650 |
| Long-term\tinstitutional | $\t2,326,176 | $14,338 | $\t(19,626) | $\t10,836 | $\t278,336 | $\t2,610,060 |

(1) Amounts	include	$19.6	billion	of	AUM	related	to	fund	ranges	reclassed	from	institutional	to	retail	and	$6.0	billion	of	AUM	reclassed	from	non-ETF	index	equity	and	fixed	income	to	multi-asset.

BlackRock's	institutional	AUM	is	well	diversified	by	both	product	and	region,	and	we serve	institutional	investors	on	six	continents	in	sub-categories	including:	pensions, endowments	and	foundations,	official	institutions,	and	financial	institutions,	as	described below.

Institutional	active	AUM	ended	the	quarter	at	$932.4	billion,	up	$47.7	billion,	or	5%, since	year-end	2012.	Institutional	active	represented	23%	of	long-term	AUM	and	21% of	long-term	base	fees.	Growth	in	AUM	reflected	continued	strength	in	multi-asset	class products	with	net	inflows	of	$29.0	billion	largely	from	defined	contribution	plans	into target	date	offerings.	Multi-asset	class	net	inflows	were	offset	by	equity	net	outflows	of $16.5	billion,	with	70%	of	outflows	coming	from	fundamental	strategies,	and	fixed income	net	outflows	of	$3.6	billion,	largely	from	U.S.	intermediate	duration mandates.	Alternatives	net	outflows	of	$9.8	billion	were	primarily	due	to	active	currency redemptions	of	$6.5	billion	and	return	of	capital	on	opportunistic	funds	of	$2.5	billion.

Institutional	non-ETF	index	AUM	totaled	$1.678	trillion	at	December	31,	2013,	reflecting net	inflows	of	$15.3	billion.	Flows	were	led	by	fixed	income	with	net	inflows	of $8.3	billion,	primarily	into	local	currency,	U.S.	targeted	duration	and	global	bond mandates	as	clients	rebalanced	portfolios	and	captured	gains	in	equity	markets. Equities	saw	net	inflows	of	$8.0	billion,	primarily	into	global	mandates,	as	clients increasingly	looked	to	use	passive	vehicles	for	broad	macro	exposure.	Institutional	non- ETF	index	represented	42%	of	long-term	AUM	at	December	31,	2013	and	accounted for	10%	of	long-term	base	fees	for	2013.

The	Company's	institutional	clients	consist	of	the	following:

•	Pensions,	Foundations	and	Endowments.	BlackRock	is	among	the	largest managers	of	pension	plan	assets	in	the	world	with	$1.718	trillion,	or	66%,	of	long- term	institutional	AUM	managed	for	defined	benefit,	defined	contribution	and	other pension	plans	for	corporations,	governments	and	unions	at	December	31,	2013.

Retirement	is	a	key	theme	as	longevity,	aging	populations	and	changing demographics	worldwide	are	driving	investment	decisions.	The	market	landscape is	shifting	from	defined	benefit	to	defined	contribution,	driving	strong	flows	in	our defined	contribution	channel,	which	had	$30.0	billion	of	long-term	net	inflows	for the	year,	or	7%	organic	growth.	Defined	contribution	net	inflows	were	led	by	$20.5 billion	into	multi-asset	class	products,	with	our	LifePath®	target-date	suite	serving as	a	key	component	of	our	retirement	solutions.	In	2013,	our	LifePath	franchise raised	$23.9	billion	in	net	inflows,	a	38%	organic	growth	rate.	We	ended	2013	with $526.4	billion	in	defined	contribution	AUM,	and	remain	well	positioned	to capitalize	on	the	on-going	evolution	of	the	defined	contribution	market	and demand	for	outcome-oriented	investments.	An	additional	$59.9	billion,	or	3%	of long-term	institutional	AUM,	was	managed	for	other	tax-exempt	investors, including	charities,	foundations	and	endowments.

•	Official	Institutions.	We	also	managed	$221.5	billion,	or	8%,	of	long-term institutional	AUM,	for	official	institutions,	including	central	banks,	sovereign	wealth funds,	supranationals,	multilateral	entities	and	government	ministries	and agencies	at	year-end	2013.	This	specialty	client	group	grew	with	long-term	net new	business	of	$22.7	billion	for	the	year,	primarily	into	passive	equity	mandates. These	clients	often	require	specialized	investment	policy	advice,	the	use	of customized	benchmarks	and	training	support.

•	Financial	and	Other	Institutions.	BlackRock	is	a	top	independent	manager	of assets	for	insurance	companies,	which	accounted	for	$237.3	billion,	or	9%,	of institutional	long-term	AUM	at	year-end	2013,	and	contributed	$5.7	billion	of	long- term	net	inflows.	Assets	managed	for	other	taxable	institutions,	including corporations,	banks	and	third-party	fund	sponsors	for	which	we	provide	sub- advisory	services,	totaled	$373.3	billion,	or	14%,	of	long-term	institutional	AUM at	year-end.

# PRODUCT	TYPE

Component	changes	in	AUM	by	product	type	and	investment	style	for	2013	are	presented	below.

| (in	millions) | 12/31/2012 | Business | Adjustments(1) | Acquisitions(2) | Market	/	FX | 12/31/2013 |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| Equity: |  |  |  |  |  |  |
| Active | $287,215 | $(15,377) | $— | $— | $45,424 | $317,262 |
| iShares | 534,648 | 74,119 | — | 13,021 | 96,347 | 718,135 |
| Fixed\tincome: |  |  |  |  |  |  |
| Active | 656,331 | 10,443 | — | — | (14,565) | 652,209 |
| iShares | 192,852 | (7,450) | — | 1,294 | (7,861) | 178,835 |
| Multi-asset\tclass | 267,748 | 42,298 | 5,998 | — | 25,170 | 341,214 |
| Alternatives: |  |  |  |  |  |  |
| Core | 68,367 | 2,703 | — | 10,972 | 2,984 | 85,026 |
| Currency\tand\tcommodities | 41,428 | (8,653) | — | 1,645 | (8,332) | 26,088 |
| Subtotal | 2,048,589 | 98,083 | 5,998 | 26,932 | 139,167 | 2,318,769 |
| Non-ETF\tIndex: |  |  |  |  |  |  |
| Equity | 1,023,638 | 10,515 | \t(5,172) | — | 253,317 | 1,282,298 |
| Fixed\tincome | 410,139 | 8,515 | (826) | — | (6,686) | 411,142 |
| Subtotal\tnon-ETF\tindex | 1,433,777 | 19,030 | \t(5,998) | — | 246,631 | 1,693,440 |
| Long-term | 3,482,366 | 117,113 | — | 26,932 | 385,798 | 4,012,209 |
| Cash\tmanagement | 263,743 | 10,056 | — | — | 1,755 | 275,554 |
| Advisory | 45,479 | (7,442) | — | — | (1,712) | 36,325 |
| Total\tAUM | $\t3,791,588 | \t$\t119,727 | $— | $\t26,932 | $\t385,841 | $ \t4,324,088 |

(1) Amounts	include	$6.0	billion	of	AUM	reclassed	from	non-ETF	index	equity	and	fixed	income	to	multi-asset.

(2) Amounts	represent	$16.0	billion	of	AUM	acquired	in	the	Credit	Suisse	ETF	acquisition	in	July	2013	and	$11.0	billion	of	AUM	acquired	in	the	MGPA	acquisition	in	October	2013.

Long-term	product	offerings	include	active	and	passive	strategies.	Our	active	strategies seek	to	earn	attractive	returns	in	excess	of	a	market	benchmark	or	performance	hurdle while	maintaining	an	appropriate	risk	profile.	We	offer	two	types	of	active	strategies: those	that	rely	primarily	on	fundamental	research	and	those	that	utilize	primarily quantitative	models	to	drive	portfolio	construction.	In	contrast,	passive	strategies	seek	to closely	track	the	returns	of	a	corresponding	index,	generally	by	investing	in substantially	the	same	underlying	securities	within	the	index	or	in	a	subset	of	those securities	selected	to	approximate	a	similar	risk	and	return	profile	of	the	index.	Passive strategies	include	both	our	institutional	non-ETF	index	products	and	iShares	ETFs.

Although	many	clients	use	both	active	and	passive	strategies,	the	application	of	these strategies	may	differ.	For	example,	clients	may	use	index	products	to	gain	exposure	to a	market	or	asset	class.	In	addition,	institutional	non-ETF	index	assignments	tend	to	be very	large	(multi-billion	dollars)	and	typically	reflect	low	fee	rates.	This	has	the	potential to	exaggerate	the	significance	of	net	flows	in	institutional	index	products	on	BlackRock's revenues	and	earnings.

# Equity

Year-end	2013	equity	AUM	of	$2.318	trillion	increased	by	$472.2	billion,	or	26%,	from the	end	of	2012,	largely	due	to	flows	into	U.S.	and	a	range	of	international	equity mandates	reflecting	investors'	increased	risk	appetite	and	the	effect	of	higher	market valuations.	Equity	AUM	growth	included	$69.3	billion	in	net	new	business	and $13.0	billion	in	new

assets	related	to	the	Credit	Suisse	ETF	acquisition	in	July	2013.	Net	new	business	of $69.3	billion	was	driven	by	net	inflows	of	$74.1	billion	and	$10.5	billion	into	iShares	and non-ETF	index	accounts,	respectively.	Passive	inflows	were	offset	by	active	net outflows	of	$15.4	billion,	with	net	outflows	of	$9.9	billion	and	$5.5	billion	from fundamental	and	scientific	active	equity	products,	respectively.

BlackRock's	effective	fee	rates	fluctuate	due	to	changes	in	AUM	mix.	Approximately half	of	BlackRock's	equity	AUM	is	tied	to	international	markets,	including	emerging markets,	which	tend	to	have	higher	fee	rates	than	similar	U.S.	equity	strategies. Accordingly,	fluctuations	in	international	equity	markets,	which	do	not	consistently	move in	tandem	with	U.S.	markets,	may	have	a	greater	impact	on	BlackRock's	effective equity	fee	rates	and	revenues.

# Fixed	Income

Fixed	income	AUM	ended	2013	at	$1.242	trillion,	declining	$17.1	billion,	or	1%,	relative to	December	31,	2012.	The	decline	in	AUM	reflected	$29.1	billion	in	market	and	foreign exchange	losses,	partially	offset	by	$11.5	billion	in	net	new	business	and	$1.3	billion	in new	assets	related	to	the	Credit	Suisse	ETF	acquisition.	In	2013,	net	new	business	was led	by	strong	flows	into	unconstrained	fixed	income	offerings,	such	as	our	Strategic Income	Opportunities	fund,	which	had	net	inflows	of	$6.9	billion	during	the	year,	despite overall	industry	outflows	from	U.S.	bond	funds.	Fixed	income	net	inflows	of	$14.8	billion and	$8.5	billion	into	fundamental	and	non-ETF	index	products,	respectively,	were partially	offset	by	net	outflows	of	$7.5	billion	and	$4.3	billion	from	iShares	and	model based	strategies,	respectively.

# Multi-Asset	Class

# Component	Changes	in	Multi-Asset	Class	AUM

|  |  | Component	Changes	in	Multi-Asset	Class	AUM | Component	Changes	in	Multi-Asset	Class	AUM | Component	Changes	in	Multi-Asset	Class	AUM |  |
| :--- | :--- | :--- | :--- | :--- | :--- |
|  |  | Net\tNew |  |  |  |
| (in\tmillions) | 12/31/2012 | Business | Adjustments(1) | Market\t/\tFX | 12/31/2013 |
| Asset\tallocation\tand\tbalanced | $140,160 | $15,904 | $— | $13,540 | $169,604 |
| Target\tdate/risk | 69,884 | 26,073 | 5,998 | 9,453 | 111,408 |
| Fiduciary | 57,704 | 321 | — | 2,177 | 60,202 |
| Multi-asset | $\t267,748 | $\t42,298 | $\t5,998 | $\t25,170 | $\t341,214 |

BlackRock's	multi-asset	class	team	manages	a	variety	of	balanced	funds	and	bespoke mandates	for	a	diversified	client	base	that	leverages	our	broad	investment	expertise	in global	equities,	currencies,	bonds	and	commodities,	and	our	extensive	risk management	capabilities.	Investment	solutions	might	include	a	combination	of	long-only portfolios	and	alternative	investments	as	well	as	tactical	asset	allocation	overlays.

Flows	reflected	ongoing	institutional	demand	for	our	solutions-based	advice	with	$27.1 billion,	or	64%,	of	net	inflows	coming	from	institutional	clients.	Defined	contribution plans	of	institutional	clients	remained	a	significant	driver	of	flows,	and	contributed $20.5	billion	to	institutional	multi-asset	class	net	new	business	in	2013,	primarily	into target	date	and	target	risk	product	offerings.	Retail	net	inflows	of	$14.8	billion	were driven	by	particular	demand	for	our	Global	Allocation	suite,	which	saw	$6.3	billion	of	net inflows,	and	our	Multi-Asset	Income	fund	which	raised	$4.1	billion	in	2013.

The	Company's	multi-asset	strategies	include	the	following:

•	Asset	allocation	and	balanced	products	represented	50%	of	multi-asset	class	AUM at	year-end,	with	growth	in	AUM	driven	by	net	new	business	of	$15.9	billion. These	strategies	combine	equity,	fixed	income	and	alternative	components	for investors	seeking	a	tailored	solution	relative	to	a	specific	benchmark	and	within	a risk	budget.	In	certain	cases,	these	strategies	seek	to

minimize	downside	risk	through	diversification,	derivatives	strategies	and	tactical asset	allocation	decisions.	Flagship	products	in	this	category	include	our	Global Allocation	and	Multi-Asset	Income	suites.

•	Target	date	and	target	risk	products	grew	37%	organically	in	2013.	Institutional investors	represented	90%	of	target	date	and	target	risk	AUM,	with	defined contribution	plans	accounting	for	over	80%	of	AUM.	The	remaining	10%	of	target date	and	target	risk	AUM	consisted	of	retail	client	investments.	Flows	were	driven by	defined	contribution	investments	in	our	LifePath	and	LifePath	Retirement Income®	offerings,	and	included	$10.4	billion	of	assets	related	to	two	large LifePath	open-architecture	assignments	where	we	provide	customized	asset allocation	glidepaths,	direct	asset	management	and	model	the	use	of	third-party managers.	LifePath	products	utilize	a	proprietary	asset	allocation	model	that	seeks to	balance	risk	and	return	over	an	investment	horizon	based	on	the	investor's expected	retirement	timing.

•	Fiduciary	management	services	are	complex	mandates	in	which	pension	plan sponsors	or	endowments	and	foundations	retain	BlackRock	to	assume responsibility	for	some	or	all	aspects	of	plan	management.	These	customized services	require	strong	partnership	with	the	clients'	investment	staff	and	trustees in	order	to	tailor	investment	strategies	to	meet	client-specific	risk	budgets	and return	objectives.

# Alternatives

|  |  | Component	Changes	in	Alternatives	AUM | Component	Changes	in	Alternatives	AUM | Component	Changes	in	Alternatives	AUM |  |
| :--- | :--- | :--- | :--- | :--- | :--- |
|  |  | Net\tNew |  |  |  |
| (in\tmillions) | 12/31/2012 | Business | Acquisitions(1) | Market\t/\tFX | 12/31/2013 |
| Core: |  |  |  |  |  |
| Hedge\tFunds | $26,636 | $4,440 | $— | $1,102 | $32,178 |
| Funds\tof\tFunds | 29,083 | (1,358) | — | 1,111 | 28,836 |
| Real\tEstate\tand\tHard\tAssets | 12,648 | (379) | 10,972 | 771 | 24,012 |
| Subtotal\tCore | 68,367 | 2,703 | 10,972 | 2,984 | 85,026 |
| Currency\tand\tcommodities | 41,428 | (8,653) | 1,645 | (8,332) | 26,088 |
| Alternatives | $\t109,795 | $\t(5,950) | $\t12,617 | $\t(5,348) | $\t111,114 |

(1) Amounts	represent	AUM	acquired	in	the	Credit	Suisse	ETF	acquisition	in	July	2013	and	AUM	acquired	in	the	MGPA	acquisition	in	October	2013.

The	BlackRock	Alternative	Investors	("BAI")	group	coordinates	our	alternative investment	efforts,	including	product	management,	business	development	and	client service.	Our	alternatives	products	fall	into	two	main	categories	—	core	and	currency and	commodities.	Core	includes	hedge	funds,	funds	of	funds	(hedge	funds	and	private equity),	real	estate	and	hard	asset	offerings.	The	products	offered	under	the	BAI umbrella	are	described	below.

We	continued	to	make	significant	investments	in	our	alternatives	platform	as demonstrated	by	our	acquisition	of	MGPA,	which	doubled	the	size	of	our	real	estate investment	advisory	platform	in	addition	to	extending	our	real	estate	debt	and	equity investment	capabilities	to	Asia-Pacific	and	Europe,	and	the	build	out	of	our	alternatives retail	platform,	which	now	stands	at	$16.2	billion	in	AUM.	We	believe	that	as alternatives	become	more	conventional	and	investors	adapt

their	asset	allocation	strategies	to	best	meet	their	investment	objectives,	they	will	further increase	their	use	of	alternative	investments	to	complement	core	holdings,	and	as	a	top 10	alternative	provider4	our	highly	diversified	$111.1	billion	alternatives	franchise	is well	positioned	to	meet	growing	demand	from	both	institutional	and	retail	investors.

# Core.

•	Hedge	Funds	net	inflows	of	$4.4	billion	were	led	by	net	inflows	of	$5.9	billion	into single-strategy	hedge	funds.	Single-strategy	net	inflows	were	driven	by	net	inflows of	$4.6	billion	into	retail	alternative	mutual	funds,	paced	by	our	zero-duration	liquid Global	Long/Short	Credit	fund.	Single-strategy	net	inflows	were	offset	by	return	of capital	of	$2.5	billion	on	opportunistic	funds,	largely	due	to	a	partial	liquidation	of an	opportunistic	2007	vintage	closed-end	mortgage	fund.	Hedge	fund	AUM includes	a	variety	of	single-strategy,	multi-strategy,	and	global	macro,	as	well	as portable	alpha,	distressed	and	opportunistic	offerings.	Products	include	both	open- end	hedge	funds	and	similar	products,	and	closed-end	funds	created	to	take advantage	of	specific	opportunities	over	a	defined,	often	longer-term	investment horizon.

•	Funds	of	Funds	AUM	included	$16.9	billion	in	funds	of	hedge	funds	and	hybrid vehicles	and	$11.9	billion	in	private	equity	funds	of	funds.	Net	outflows	of	$1.4 billion	were	predominantly	from	funds	of	hedge	funds.

•	Real	Estate	and	Hard	Assets	AUM	grew	90%	compared	to	year-end	2012, primarily	due	to	$11.0	billion	in	new	assets	from	the	acquisition	of	MGPA. Offerings	include	high	yield	debt	and	core,	value-added	and	opportunistic	equity portfolios	and	renewable	power	funds.	We	continued	to	grow	our	real	estate platform	and	product	offerings	with	the	acquisition	of	MGPA.

During	2013,	we	secured	$6	billion	of	alternatives	commitments	in	offerings	including infrastructure,	strategic	credit	and	funds	of	funds.	The	majority	of	these	commitments are	unfunded	and	are	expected	to	be	deployed	in	future	quarters.

Currency	and	Commodities.	AUM	in	currency	and	commodities	declined	37% compared	to	year-end	2012,	reflecting	net	outflows	of	$8.7	billion,	primarily	from	low	fee active	currency	mandates.	Currency	and	commodities	products	include	a	range	of active	and	passive	products.	Our	iShares	commodities	products	represented	$16.1 billion	of	AUM,	including	$1.6	billion	acquired	from	Credit	Suisse,	and	are	not	eligible	for performance	fees.

Cash	management	AUM	totaled	$275.6	billion	at	December	31,	2013,	of	which	$114.7 billion	was	in	prime	strategies,	up	$11.8	billion,	or	4%,	from	year-end	2012.	Cash management	products	include	taxable	and	tax-exempt	money	market	funds	and customized	separate	accounts.	Portfolios	are	denominated	in	U.S.	dollar,	Canadian dollar,	Australian	dollar,	Euro	or	British	pound.	We	generated	net	inflows	of	$10.1 billion	during	2013,	and	continue	to	face	headwinds	around	the	uncertainty	of	future regulatory	changes	and	a	near	zero	interest	rate	environment.	We	provided	new solutions	and	choices	for	our	clients	by	launching	ultra-short	duration	products	in	the United	States,	which	address	the	immediate	challenge	of	a	continuing	low	interest	rate environment	as	well	as	provide	valuable	investment	alternatives	in	the	wake	of	money market	fund	regulatory	change.	In	Europe,	we	launched	a	non-rated	Euro	liquidity	fund. Further,	some	existing	products	were	re-structured	with	features	to	address	negative yields,	should	they	occur.

# CLIENT	REGION

|  |  | AUM	by	Product	Type	&amp;	Client	Region<br>December	31,	2013 | AUM	by	Product	Type	&amp;	Client	Region<br>December	31,	2013 |  |
| :--- | :--- | :--- | :--- | :--- |
| (in\tmillions) | Americas | EMEA | Asia-Pacific | Total |
| Equity | $1,467,252 | $660,602 | $189,841 | $2,317,695 |
| Fixed\tincome | 702,608 | 436,124 | 103,454 | 1,242,186 |
| Multi-asset\tclass | 214,895 | 110,524 | 15,795 | 341,214 |
| Alternatives | 56,490 | 35,923 | 18,701 | 111,114 |
| Long-term | 2,441,245 | 1,243,173 | 327,791 | 4,012,209 |
| Cash\tmanagement | 189,359 | 83,207 | 2,988 | 275,554 |
| Advisory | 24,925 | 9,397 | 2,003 | 36,325 |
| Total | $\t2,655,529 | $\t1,335,777 | $\t332,782 | $\t4,324,088 |

|  |  | Component	Changes	in	AUM	–	Client	Region | Component	Changes	in	AUM	–	Client	Region | Component	Changes	in	AUM	–	Client	Region |  |
| :--- | :--- | :--- | :--- | :--- | :--- |
|  |  | Net\tNew |  |  |  |
| (in\tmillions) | 12/31/2012 | Business | Acquisitions(1) | Market\t/\tFX | 12/31/2013 |
| Americas | $2,326,482 | $76,017 | $4,282 | $248,748 | $2,655,529 |
| EMEA | 1,158,261 | 38,743 | 20,536 | 118,237 | 1,335,777 |
| Asia-Pacific | 306,845 | 4,967 | 2,114 | 18,856 | 332,782 |
| Total\tAUM | $\t3,791,588 | $\t119,727 | $\t26,932 | $\t385,841 | $ \t4,324,088 |

Our	footprint	in	each	of	these	regions	reflects	strong	relationships	with	intermediaries and	an	established	ability	to	deliver	our	global	investment	expertise	in	funds	and	other products	tailored	to	local	regulations	and	requirements.

Americas.	Net	new	business	in	long-term	products	of	$72.1	billion	was	driven	by	equity and	multi-asset	class	net	inflows	of	$53.3	billion	and	$36.1	billion,	respectively,	which were	partially	offset	by	fixed	income	and	alternatives	net	outflows	of	$13.0	billion	and $4.3	billion,	respectively.	During	the	year,	we	served	clients	through	offices	in	33	states in	the	United	States	as	well	as	Canada,	Mexico,	Brazil,	Chile,	Colombia	and	Spain.

EMEA.	During	the	year,	clients	awarded	us	long-term	net	new	business	of	$41.3	billion, including	inflows	from	investors	in	22	countries	across	the	region.	EMEA	net	new business	was	led	by	equity	net	inflows	of	$20.1	billion	as	clients	began	to	re-risk	in	the face	of	improving	confidence	in	European	markets.	Our	offerings	include	fund	families in	the	United	Kingdom,	the	Netherlands,	Luxembourg	and	Dublin	and	iShares	listed	on stock	exchanges	throughout	Europe	as	well	as	separate	accounts	and	pooled investment	products.

Asia-Pacific.	Clients	in	the	Asia-Pacific	region	are	served	through	offices	in	Japan, Australia,	Hong	Kong,	Malaysia,	Singapore,	Taiwan	and	Korea,	and	joint	ventures	in China	and	India.	Long-term	net	new	business	of	$3.8	billion	was	led	by	fixed	income and	multi-asset	class	net	inflows	of	$8.7	billion	and	$1.2	billion,	respectively,	partially offset	by	equity	and	alternatives	net	outflows	of	$4.2	billion	and	$1.9	billion,	respectively.

# INVESTMENT	PERFORMANCE

Investment	performance	across	active	and	passive	products	as	of	December	31,	2013 was	as	follows:

|  | One-year | Three-year | Five-year |
| :--- | :--- | :--- | :--- |
| Fixed\tIncome: | period | period | period |
| Actively\tmanaged\tproducts |  |  |  |
| above\tbenchmark\tor\tpeer |  |  |  |
| median |  |  |  |
| Taxable | 70% | 82% | 87% |
| Tax-exempt | 48% | 65% | 65% |
| Passively\tmanaged\tproducts |  |  |  |
| within\tor\tabove\ttolerance | 97% | 99% | 91% |
| Equity: |  |  |  |
| Actively\tmanaged\tproducts |  |  |  |
| above\tbenchmark\tor\tpeer |  |  |  |
| median |  |  |  |
| Fundamental | 52% | 49% | 50% |
| Scientific | 93% | 91% | 85% |
| Passively\tmanaged\tproducts |  |  |  |
| within\tor\tabove\ttolerance | 94% | 98% | 94% |

Product	Performance	Notes.	Past	performance	is	not	indicative	of	future	results.	Except as	specified,	the	performance	information	shown	is	as	of	December	31,	2013	and	is based	on	preliminarily	data	available	at	that	time.	The	performance	data	shown	reflects information	for	all	actively	and	passively	managed	equity	and	fixed	income	accounts, including	U.S.	registered	investment	companies,	European-domiciled	retail	funds	and separate	accounts	for	which	performance	data	is	available,	including	performance	data

for	high	net	worth	accounts	available	as	of	November	30,	2013.	The	performance	data does	not	include	accounts	terminated	prior	to	December	31,	2013	and	accounts	for which	data	has	not	yet	been	verified.	If	such	accounts	had	been	included,	the performance	data	provided	may	have	substantially	differed	from	that	shown.

Performance	comparisons	shown	are	gross-of-fees	for	U.S.	retail,	institutional	and	high net	worth	separate	accounts	as	well	as	EMEA	institutional	separate	accounts,	and	net of	fee	for	European	domiciled	retail	funds.	The	performance	tracking	shown	for institutional	index	accounts	is	based	on	gross-of-fee	performance	and	includes	all institutional	accounts	and	all	iShares	funds	globally	using	an	index	strategy.	AUM information	is	based	on	AUM	available	as	of	December	31,	2013	for	each	account	or fund	in	the	asset	class	shown	without	adjustment	for	overlapping	management	of	the same	account	or	fund.	Fund	performance	reflects	the	reinvestment	of	dividends	and distributions.	The	information	reported	may	differ	slightly	from	that	reported	previously due	to	the	increased	number	of	accounts	that	have	been	verified	since	the	last performance	disclosure.	BlackRock	considers	these	differences	to	be	not	material.

Source	of	performance	information	and	peer	medians	is	BlackRock,	Inc.	and	is	based in	part	on	data	from	Lipper	Inc.	for	U.S.	funds	and	Morningstar,	Inc.	for	non-U.S.	funds.

# BLACKROCK	SOLUTIONS

BlackRock	Solutions	offers	investment	management	technology	systems,	risk management	services	and	advisory	services	on	a	fee	basis.	Aladdin	is	our	proprietary technology	platform,	which	serves	as	the	risk	management	system	for	both	BlackRock and	a	growing	number	of	sophisticated	institutional	investors	around	the	world.	BRS also	offers	comprehensive	risk	reporting	capabilities	via	the	Green	Package®	and	risk management	advisory	services;	interactive	fixed	income	analytics	through	our	web- based	calculator,	AnSer®;	middle	and	back	office	outsourcing	services;	and	investment accounting.	BRS'	Financial	Markets	Advisory	("FMA")	group	provides	services	such	as valuation	and	risk	assessment	of	illiquid	assets,	portfolio	restructuring,	workouts	and dispositions	of	distressed	assets	and	financial	and	balance	sheet	strategies,	for	a	wide range	of	global	clients.

BlackRock	Solutions	record	revenues	of	$577	million	were	up	11%	year	over	year.	Our Aladdin	business,	which	represented	73%	of	BRS	revenue	for	the	year,	signed	more than	15	new	clients	in	2013,	and	continues	to	benefit	from	trends	favoring	global investment	platform	consolidation	and	multi-asset	risk	solutions.	Aladdin	business assignments	are	typically	long-term	contracts	that	provide	significant	recurring	revenue.

Our	FMA	group	signed	more	than	50	new	assignments	during	the	year	and	continued	to post	strong	revenues,	even	as	the	business	transitions	from	a	"crisis	management" emphasis	to	a	more	institutionalized	advisory	business	model,	with	a	strong	focus	on helping	clients	navigate	and	implement	requirements	for	the	new	regulatory environment.	Advisory	AUM	decreased	20%	to	$36.3	billion,	driven	by	$7.4	billion	of planned	client	distributions	reflecting	our	continued	success	in	disposing	of	assets	for clients	at,	or	above,	targeted	levels.

At	year-end,	BRS	served	clients,	including	banks,	insurance	companies,	official institutions,	pension	funds,	asset	managers	and	other	institutional	investors	across North	America,	Europe,	Asia	and	Australia.

# SECURITIES	LENDING

Securities	lending	is	managed	by	a	dedicated	team,	supported	by	quantitative	analysis, proprietary	technology	and	disciplined	risk	management.	The	cash	management	team invests	the	cash	we	receive	as	collateral	for	securities	on	loan	in	other	portfolios.	Fees for	securities	lending	can	be	structured	as	a	share	of	earnings	and/or	as	a	management fee	based	on	a	percentage	of	the	value	of	the	cash	collateral.	The	value	of	the	securities on	loan	and	the	revenue	earned	is	captured	in	the	corresponding	asset	class	being managed.	The	value	of	the	collateral	is	not	included	in	AUM.

Outstanding	loan	balances	ended	the	year	at	approximately	$156	billion,	up	from	$134 billion	at	year-end	2012.	Liability	spreads	declined	from	elevated	2012	levels,	as	the proportion	of	"special	collateral,"	securities	commanding	premium	lending	fees,	declined due	to	low	idiosyncratic	risk,	low	single	stock	volatility	and	lack	of	M&A	activity.

BlackRock	employs	a	conservative	investment	style	for	cash	and	securities	lending collateral	that	emphasizes	quality,	liquidity	and	interest	rate	risk	management. Disciplined	risk	management,	including	a	rigorous	credit	surveillance	process,	is	an integral	part	of	the	investment	process.	BlackRock's	Cash	Management	Credit Committee	has	established	risk	limits,	such	as	aggregate	issuer	exposure	limits	and maturity	limits,	across	many	of	the	products	BlackRock	manages,	including	over	all	of	its cash	management	products.	In	the	ordinary	course	of	our	business,	there	may	be instances	when	a	portfolio	may	exceed	an	internal	risk	limit	or	when	an	internal	risk	limit may	be	changed.	No	such	instances,	individually	or	in	the	aggregate,	have	been material	to	the	Company.	To	the	extent	that	daily	evaluation/reporting	of	the	profile	of the	portfolios	identifies	that	a	limit	has	been	exceeded,	the	relevant	portfolio	will	be adjusted.	To	the	extent	a	portfolio	manager	would	like	to	obtain	a	temporary	waiver	of	a risk	limit,	the	portfolio	manager	must	obtain	approval	from	the	credit	research	team, which	is	independent	from	the	cash	management	portfolio	managers.	While	a	risk	limit may	be	waived,	such	temporary	waivers	are	infrequent.

# RISK	&	QUANTITATIVE	ANALYSIS

Across	all	asset	classes,	in	addition	to	the	efforts	of	the	portfolio	management	teams, the	Risk	&	Quantitative	Analysis	("RQA")	group	at	BlackRock	draws	on	extensive analytical	systems	and	proprietary	and	third-party	data	to	identify,	measure	and	manage a	wide	range	of	risks.	RQA	provides	risk	management	advice	and	independent	risk oversight	of	the	investment	management	processes,	identifies	and	helps	manage counterparty	and	operational	risks,	coordinates	standards	for	firm	wide	investment performance	measurement	and	determines	risk	management-related	analytical	and information	requirements.	Where	appropriate,	RQA	will	work	with	portfolio	managers and	developers	to	facilitate	the	development	or	improvement	of	risk	models	and analytics.

# COMPETITION

BlackRock	competes	with	investment	management	firms,	mutual	fund	complexes, insurance	companies,	banks,	brokerage	firms	and	other	financial	institutions	that	offer products	that	are	similar	to,	or	alternatives	to,	those	offered	by	BlackRock.	In	order	to grow	its	business,	BlackRock	must

be	able	to	compete	effectively	for	AUM.	Key	competitive	factors	include	investment performance	track	records,	the	efficient	delivery	of	beta	for	passively	managed products,	investment	style	and	discipline,	client	service	and	brand	name	recognition. Historically,	the	Company	has	competed	principally	on	the	basis	of	its	long-term investment	performance	track	record,	its	investment	process,	its	risk	management	and analytic	capabilities	and	the	quality	of	its	client	service.	These	factors	may	place BlackRock	at	a	competitive	disadvantage	and	there	can	be	no	assurance	that	the Company's	strategies	and	efforts	to	maintain	its	existing	AUM	and	to	attract	new business	will	be	successful.

# GEOGRAPHIC	INFORMATION

At	December	31,	2013,	BlackRock	served	clients	in	more	than	100	countries	across	the globe,	including	the	United	States,	the	United	Kingdom	and	Japan.

The	following	table	illustrates	the	Company's	total	revenue	for	2013,	2012	and	2011	by geographic	region.	These	amounts	are	aggregated	on	a	legal	entity	basis	and	do	not necessarily	reflect	where	the	customer	resides.

| Revenue | 2013 | 2012 | 2011 |
| :--- | :--- | :--- | :--- |
| Americas | $6,829 | $6,429 | $6,064 |
| Europe | 2,832 | 2,460 | 2,517 |
| Asia-Pacific | 519 | 448 | 500 |
| Total\trevenue | $\t10,180 | $ \t9,337 | $ \t9,081 |

The	following	table	illustrates	the	Company's	long-lived	assets,	including	goodwill	and property	and	equipment	at	December	31,	2013,	2012	and	2011	by	geographic	region. These	amounts	are	aggregated	on	a	legal	entity	basis	and	do	not	necessarily	reflect where	the	asset	is	physically	located.

| Long-lived	Assets | 2013 | 2012 | 2011 |
| :--- | :--- | :--- | :--- |
| Americas | $ 13,204 | $ 13,238 | $13,133 |
| Europe | 214 | 166 | 123 |
| Asia-Pacific | 87 | 63 | 73 |
| Total\tlong-lived\tassets | $\t13,505 | $\t13,467 | $ \t13,329 |

Americas	primarily	is	comprised	of	the	United	States,	Canada,	Brazil,	Chile	and Mexico,	while	Europe	is	primarily	comprised	of	the	United	Kingdom.	Asia-Pacific	is comprised	of	Japan,	Australia,	Singapore,	Hong	Kong,	Taiwan,	Korea,	India,	Malaysia and	China.

# EMPLOYEES

At	December	31,	2013,	BlackRock	had	a	total	of	approximately	11,400	employees, including	approximately	5,400	located	in	offices	outside	the	United	States.	Consistent with	our	commitment	to	continually	expand	and	enhance	our	talent	base	to	support	our clients,	we	added	approximately	900	employees	during	the	year,	including	in	strategic focus	areas.

# REGULATION

Virtually	all	aspects	of	BlackRock's	business	are	subject	to	various	laws	and	regulations both	in	and	outside	the	United

States,	some	of	which	are	summarized	below.	These	laws	and	regulations	are	primarily intended	to	protect	investment	advisory	clients,	investors	in	registered	and	unregistered investment	companies,	trust	customers	of	BlackRock	Institutional	Trust	Company,	N.A. ("BTC"),	PNC	and	its	bank	subsidiaries	and	their	customers,	and	the	financial	system. Under	these	laws	and	regulations,	agencies	that	regulate	investment	advisers, investment	funds	and	bank	holding	companies	and	other	individuals	and	entities	have broad	administrative	powers,	including	the	power	to	limit,	restrict	or	prohibit	the regulated	entity	or	person	from	carrying	on	business	if	it	fails	to	comply	with	such	laws and	regulations.	Possible	sanctions	for	significant	compliance	failures	include	the suspension	of	individual	employees,	limitations	on	engaging	in	certain	lines	of	business for	specified	periods	of	time,	revocation	of	investment	adviser	and	other	registrations, censures	and	fines	both	for	individuals	and	the	Company.	The	rules	governing	the regulation	of	financial	institutions	and	their	holding	companies	and	subsidiaries	are	very detailed	and	technical.	Accordingly,	the	discussion	below	is	general	in	nature,	does	not purport	to	be	complete	and	is	current	only	as	of	the	date	of	this	report.

# REGULATORY	REFORM

In	July	2010,	the	Dodd-Frank	Wall	Street	Reform	and	Consumer	Protection	Act	(the "DFA")	was	signed	into	law	in	the	United	States.	The	DFA	is	expansive	in	scope	and requires	the	adoption	of	extensive	regulations	and	numerous	regulatory	decisions	in order	to	be	fully	implemented.	The	continued	adoption	of	these	regulations	and decisions	will	in	large	measure	determine	the	impact	of	the	DFA	on	BlackRock	and other	financial	services	firms.	The	DFA	may	significantly	change	BlackRock's	operating environment	and	the	financial	markets	in	general	in	unpredictable	ways.	It	is	not possible	to	predict	the	ultimate	effects	that	the	DFA,	or	subsequent	implementing regulations	and	decisions,	will	have	upon	BlackRock's	business,	financial	condition,	and results	of	operations.	Among	the	potential	impacts,	provisions	of	the	DFA	referred	to	as the	Volcker	Rule	will	affect	the	extent	to	which	BlackRock	invests	in	and	transacts	with certain	of	its	investment	funds,	including	private	equity	funds,	hedge	funds	and	funds	of funds.	The	impact	of	the	Volcker	Rule	on	liquidity	and	pricing	in	the	broader	financial markets	is	unknown	at	this	time.	For	a	further	discussion	of	the	Volcker	Rule,	see "Item	1A	—	Risk	Factors	—	Legal	and	Regulatory	Risks."	In	addition,	BlackRock	could be	designated	a	systemically	important	financial	institution	("SIFI")	and	become	subject to	direct	supervision	by	the	Board	of	Governors	of	the	Federal	Reserve	System	(the "Federal	Reserve").	If	BlackRock	were	designated	a	SIFI,	it	could	be	subject	to enhanced	prudential,	supervisory	and	other	requirements,	such	as	risk-based	capital requirements;	leverage	limits;	liquidity	requirements;	resolution	plan	and	credit exposure	report	requirements;	concentration	limits;	a	contingent	capital	requirement; enhanced	public	disclosures;	short-term	debt	limits;	and	overall	risk	management requirements.	Further,	new	regulations	under	the	DFA	relating	to	regulation	of	swaps and	derivatives	will	impact	the	manner	by	which	BlackRock-advised	funds	and	accounts use	and	trade	swaps	and	other	derivatives,	and	may	significantly	increase	the	costs	of derivatives	trading.	Similarly,	BlackRock's	management	of	funds	and	accounts	that	use and	trade	swaps	and	derivatives	could	be	adversely	impacted	by	recently	adopted changes	to	the	Commodity	Futures	Trading	Commission's	(the	"CFTC")	regulations. These	rule	changes

include	those	concerning,	among	other	things,	the	registration	and	regulation	of commodity	pool	operators	and	commodity	trading	advisors	(and	the	accompanying registration	and	regulation	of	such	entities	by	the	National	Futures	Association	(the "NFA")),	the	registration	status	of	dealer	counterparties	and	other	counterparties	who are	major	participants	in	the	swap	markets,	and	requirements	concerning	mandatory clearing	of	certain	swap	transactions.	Jurisdictions	outside	the	United	States	in	which BlackRock	operates	are	also	in	the	process	of	devising	or	considering	more	pervasive regulation	of	many	elements	of	the	financial	services	industry,	which	could	have	a similar	impact	on	BlackRock	and	the	broader	markets.

The	DFA	and	its	regulations,	and	other	new	laws	or	regulations,	or	changes	in enforcement	of	existing	laws	or	regulations,	could	materially	and	adversely	impact	the scope	or	profitability	of	BlackRock's	business	activities;	require	BlackRock	to	change certain	business	practices;	divert	management's	time	and	attention	from	BlackRock's business	activities	to	compliance	activities;	and	expose	BlackRock	to	additional	costs (including	compliance	and	tax	costs)	and	liabilities,	as	well	as	reputational	harm.	For example,	in	addition	to	regulatory	changes	mandated	by	the	DFA,	the	Securities	and Exchange	Commission	(the	"SEC")	continues	to	review	the	role	of	and	risks	related	to, money	market	funds	and	has	indicated	that	it	may	adopt	additional	regulations.	Some of	the	proposed	changes,	if	adopted,	could	significantly	alter	money	market	fund products	and	the	entire	money	market	fund	industry.	In	2012,	the	Office	of	the Comptroller	of	the	Currency	of	the	United	States	(the	"OCC")	amended	the	regulations governing	bank-maintained	short-term	investment	funds	("STIFs")	to	include	new disclosure	requirements	regarding	portfolio	holdings	and	to	more	closely	align	portfolio limitations,	such	as	maximum	weighted	average	maturity	and	weighted	average	life, with	those	applicable	to	SEC	registered	money	market	funds.	Similarly,	the	SEC continues	to	review	the	distribution	fees	paid	to	mutual	fund	distributors	under	Rule 12b-1	under	the	Investment	Company	Act	of	1940	(the	"Investment	Company	Act"), which	are	important	to	a	number	of	the	mutual	funds	BlackRock	manages.	Any	changes to	12b-1	fees	would	alter	the	way	BlackRock's	distribution	partners	distribute	BlackRock products.	Additionally,	the	SEC,	the	Internal	Revenue	Service	("IRS")	and	the	CFTC each	continue	to	review	the	use	of	futures	and	derivatives	by	mutual	funds,	and	such reviews	could	result	in	regulations	that	further	limit	the	use	of	futures	and	derivatives	by mutual	funds.	If	adopted,	these	limitations	could	require	BlackRock	to	change	certain mutual	fund	business	practices	or	to	register	additional	entities	with	the	CFTC,	which could	result	in	additional	costs	and/or	restrictions.	In	addition,	BlackRock	has	begun reporting	certain	information	about	a	number	of	its	private	funds	to	the	SEC	and	certain information	about	a	number	of	its	commodity	pools	to	the	CFTC,	pursuant	to	systemic risk	reporting	requirements	adopted	by	both	agencies,	which	have	required,	and	will continue	to	require,	investments	in	people	and	systems	to	assure	timely	and	accurate reporting.	Still	another	example	of	changes	in	the	regulatory	landscape	was	the	IRS' implementation	of	Foreign	Account	Tax	Compliance	Act	("FATCA").	FATCA	was enacted	in	2010	and	is	intended	to	address	tax	compliance	issues	associated	with	U.S. taxpayers	with	foreign	accounts.	FATCA	requires	foreign	financial	institutions	to	report to	the	IRS	information	about	financial	accounts	held	by	U.S.	taxpayers	and	imposes withholding,	documentation	and	reporting	requirements	on	foreign	financial	institutions. Final

regulations	were	issued	by	the	IRS	on	January	17,	2013,	with	the	earliest	effective dates	beginning	on	July	1,	2014.	In	many	instances,	however,	the	precise	nature	of what	needs	to	be	implemented	will	be	governed	by	bilateral	Intergovernmental Agreements	("IGAs")	between	the	United	States	and	the	countries	in	which	BlackRock does	business.	While	many	of	these	IGAs	have	been	put	into	place,	others	have	yet	to be	concluded.	FATCA	could	cause	the	Company	to	incur	significant	administrative	and compliance	costs	and	subject	clients	to	U.S.	tax	withholding.

An	example	of	changes	in	the	regulatory	landscape	in	Europe	is	the	European	Union ("EU")	Alternative	Investment	Fund	Managers	Directive	("AIFMD"),	which	became effective	on	July	21,	2011	and	was	required	to	be	implemented	by	EU	member	states by	July	22,	2013.	The	AIFMD	regulates	managers	of,	and	service	providers	to,	a	broad range	of	alternative	investment	funds	("AIFs")	domiciled	within	and	(depending	on	the precise	circumstances)	outside	the	EU.	The	AIFMD	also	regulates	the	marketing	of	all AIFs	inside	the	European	Economic	Area	(the	"EEA").	In	general,	the	AIFMD	will	have	a staged	implementation	between	mid-2013	and	2018.	Compliance	with	the	AIFMD's requirements	will	restrict	AIF	marketing	and	will	place	additional	compliance	and disclosure	obligations	regarding	remuneration,	capital	requirements,	leverage, valuation,	stakes	in	EU	companies,	depositaries,	the	domicile	of	custodians	and	liquidity management.

Globally,	regulators	are	examining	the	potential	risks	in	ETFs	and	may	impose additional	regulations	on	ETFs,	including	requirements	to	promote	increased transparency	and	to	limit	the	ability	of	ETFs	to	utilize	derivatives.	The	International Organization	of	Securities	Commissions	published	principles	for	regulatory	oversight	of financial	benchmarks	in	2013,	with	standards	applying	to	methodologies	for	benchmark calculation,	and	transparency	and	governance	issues	in	the	benchmarking	process; some	national	and	regional	regulators	are	currently	reviewing	how	to	apply	these principles,	with	a	draft	European	Regulation	published	in	September	2013.	Any	of these	regulatory	changes	could	also	lead	to	business	disruptions,	could	materially	and adversely	impact	the	value	of	assets	in	which	BlackRock	has	invested	directly	and/or	on behalf	of	clients,	and,	to	the	extent	the	regulations	strictly	control	the	activities	of financial	services	firms,	could	make	it	more	difficult	for	BlackRock	to	conduct	certain businesses	or	distinguish	itself	from	competitors.

Additional	legislation,	changes	in	rules	promulgated	by	regulators	and	self-regulatory organizations,	or	changes	in	the	interpretation	or	enforcement	of	existing	laws	and regulations	may	directly	affect	the	method	of	operation	and	profitability	of	BlackRock. BlackRock's	profitability	also	could	be	materially	and	adversely	affected	by	modification of	the	rules	and	regulations	that	impact	the	business	and	financial	communities	in general,	including	changes	to	the	laws	governing	taxation,	antitrust	regulation	and electronic	commerce.	See	the	"—	Non-U.S.	Regulation"	section	below	for	a	further discussion	of	regulatory	reforms	being	considered	and/or	adopted	outside	of	the	United States.

# U.S.	REGULATION

BlackRock	and	certain	of	its	U.S.	subsidiaries	are	subject	to	regulation,	primarily	at	the federal	level,	by	the	SEC,	the	Department	of	Labor	(the	"DOL"),	the	Federal	Reserve, the	OCC,	the	Financial	Industry	Regulatory	Authority	("FINRA"),

the	NFA,	the	CFTC	and	other	government	agencies	and	regulatory	bodies.	Certain	of BlackRock's	U.S.	subsidiaries	are	also	subject	to	various	anti-terrorist	financing, privacy,	anti-money	laundering	regulations	and	economic	sanctions	laws	and regulations	established	by	various	agencies.

The	Investment	Advisers	Act	of	1940	(the	"Advisers	Act")	imposes	numerous obligations	on	registered	investment	advisers	such	as	BlackRock,	including	record- keeping,	operational	and	marketing	requirements,	disclosure	obligations	and prohibitions	on	fraudulent	activities.	The	Investment	Company	Act	imposes	stringent governance,	compliance,	operational,	disclosure	and	related	obligations	on	registered investment	companies	and	their	investment	advisers	and	distributors,	such	as BlackRock.	The	SEC	is	authorized	to	institute	proceedings	and	impose	sanctions	for violations	of	the	Advisers	Act	and	the	Investment	Company	Act,	ranging	from	fines	and censure	to	termination	of	an	investment	adviser's	registration.	Investment	advisers	also are	subject	to	certain	state	securities	laws	and	regulations.	Non-compliance	with	the Advisers	Act,	the	Investment	Company	Act	or	other	federal	and	state	securities	laws and	regulations	could	result	in	investigations,	sanctions,	disgorgement,	fines	and reputational	damage.

BlackRock's	trading	and	investment	activities	for	client	accounts	are	regulated	under the	Securities	Exchange	Act	of	1934	(the	"Exchange	Act"),	as	well	as	the	rules	of various	U.S.	and	non-U.S.	securities	exchanges	and	self-regulatory	organizations, including	laws	governing	trading	on	inside	information,	market	manipulation	and	a	broad number	of	technical	requirements	(e.g.,	short	sale	limits,	volume	limitations,	reporting obligations)	and	market	regulation	policies	in	the	United	States	and	globally.	Depending on	the	scope	of	the	rules	to	be	adopted	by	the	SEC,	provisions	added	to	the	Exchange Act	by	the	DFA	may	require	certain	BlackRock	subsidiaries	to	register	as	municipal advisors	in	relation	to	their	services	for	state	and	local	governments,	pension	plans	and other	investment	programs,	such	as	college	savings	plans.	In	addition,	BlackRock manages	a	variety	of	investment	funds	listed	on	U.S.	and	non-U.S.	exchanges,	which are	subject	to	the	rules	of	such	exchanges.	Violation	of	these	laws	and	regulations could	result	in	restrictions	on	the	Company's	activities	and	damage	its	reputation.

BlackRock	manages	a	variety	of	private	pools	of	capital,	including	hedge	funds,	funds	of hedge	funds,	private	equity	funds,	CDOs,	real	estate	funds,	collective	investment	trusts, managed	futures	funds	and	hybrid	funds.	Congress,	regulators,	tax	authorities	and others	continue	to	explore,	on	their	own	and	in	response	to	demands	from	the investment	community	and	the	public,	increased	regulation	related	to	private	pools	of capital,	including	changes	with	respect	to	investor	eligibility,	certain	limitations	on trading	activities,	record-keeping	and	reporting,	the	scope	of	anti-fraud	protections, safekeeping	of	client	assets	and	a	variety	of	other	matters.	BlackRock	may	be materially	and	adversely	affected	by	new	legislation,	rule-making	or	changes	in	the interpretation	or	enforcement	of	existing	rules	and	regulations	imposed	by	various regulators.

Certain	BlackRock	subsidiaries	are	subject	to	the	Employee	Retirement	Income Security	Act	of	1974	("ERISA"),	and	to	regulations	promulgated	thereunder	by	the	DOL, insofar	as	they	act	as	a	"fiduciary"	under	ERISA	with	respect	to	benefit	plan	clients. ERISA	and	applicable	provisions	of	the	Internal	Revenue	Code	impose	certain	duties on	persons	who	are

fiduciaries	under	ERISA,	prohibit	certain	transactions	involving	ERISA	plan	clients	and impose	excise	taxes	for	violations	of	these	prohibitions,	mandate	certain	required periodic	reporting	and	disclosures	and	require	BlackRock	to	carry	bonds	ensuring against	losses	caused	by	fraud	or	dishonesty.	ERISA	also	imposes	additional compliance,	reporting	and	operational	requirements	on	BlackRock	that	otherwise	are not	applicable	to	non-benefit	plan	clients.

BlackRock	has	seven	subsidiaries	that	are	registered	as	commodity	pool	operators ("CPOs")	and/or	commodity	trading	advisors	with	the	CFTC	and	are	members	of	the NFA.	Additional	BlackRock	entities	may	need	to	register	as	a	CPO	or	commodity trading	advisor	as	a	result	of	recently	enacted	regulatory	changes	by	the	CFTC.	The CFTC	and	NFA	each	administer	a	comparable	regulatory	system	covering	futures contracts	and	various	other	financial	instruments,	including	swaps	as	a	result	of	the DFA,	in	which	certain	BlackRock	clients	may	invest.	Two	of	BlackRock's	other subsidiaries,	BlackRock	Investments,	LLC	("BRIL")	and	BlackRock	Execution	Services, are	registered	with	the	SEC	as	broker-dealers	and	are	member-firms	of	FINRA.	Each broker-dealer	has	a	membership	agreement	with	FINRA	that	limits	the	scope	of	such broker-dealer's	permitted	activities.	BRIL	is	also	an	approved	person	with	the	New	York Stock	Exchange	("NYSE")	and	a	member	of	the	Municipal	Securities	Rulemaking	Board ("MSRB")	subject	to	MSRB	rules.

# U.S.	BANKING	REGULATION

PNC	is	a	bank	holding	company	and	regulated	as	a	"financial	holding	company"	by	the Federal	Reserve	under	the	Bank	Holding	Company	Act	of	1956	(the	"BHC	Act").	As described	in	"Item	1-Business",	PNC	owns	approximately	22%	of	BlackRock's	capital stock.	Based	on	the	Federal	Reserve's	current	interpretation	of	the	BHC	Act,	this ownership	interest	causes	BlackRock	to	be	treated	as	a	non-bank	subsidiary	of	PNC	for purposes	of	the	BHC	Act	and	therefore	subject	to	the	supervision	and	regulation	of	the Federal	Reserve	and	to	most	banking	laws,	regulations	and	orders	that	apply	to	PNC, including	the	Volcker	Rule.	The	supervision	and	regulation	of	PNC	and	its	subsidiaries under	applicable	banking	laws	is	intended	primarily	for	the	protection	of	its	banking subsidiaries,	its	depositors,	the	Deposit	Insurance	Fund	of	the	Federal	Deposit Insurance	Corporation,	and	the	financial	system	as	a	whole,	rather	than	for	the protection	of	stockholders,	creditors	or	clients	of	PNC	or	BlackRock.	PNC's relationships	and	good	standing	with	its	regulators	are	important	to	the	conduct	of BlackRock's	business.	BlackRock	may	also	be	subject	to	foreign	banking	laws	and supervision	that	could	affect	its	business.

BTC	is	a	limited	purpose	national	trust	company	that	does	not	accept	deposits	or	make commercial	loans	and	is	a	member	of	the	Federal	Reserve	System.	Accordingly,	BTC	is examined	and	supervised	by	the	OCC	and	is	subject	to	various	banking	laws	and regulations	enforced	by	the	OCC,	such	as	capital	adequacy,	regulations	governing fiduciaries,	conflicts	of	interest,	self-dealing,	and	anti-money	laundering	laws	and regulations.	BTC	is	also	subject	to	various	Federal	Reserve	regulations	applicable	to member	institutions,	such	as	regulations	restricting	transactions	with	affiliates.	Many	of these	laws	and	regulations	are	meant	for	the	protection	of	BTC's	customers	and	not BTC,	BlackRock	and	its	affiliates,	or	BlackRock's	stockholders.

BlackRock	generally	may	conduct	only	activities	that	are	authorized	for	a	financial holding	company	under	the	BHC	Act.	Investment	management	is	an	authorized	activity, but	must	be	conducted	within	applicable	regulatory	requirements,	which	in	some	cases are	more	restrictive	than	those	BlackRock	faces	under	applicable	securities	laws. BlackRock	may	also	invest	in	investment	companies	and	private	investment	funds	to which	it	provides	advisory,	administrative	or	other	services,	only	to	the	extent	consistent with	applicable	law	and	regulatory	interpretations.	The	Federal	Reserve	has	broad powers	to	approve,	deny	or	refuse	to	act	upon	applications	or	notices	for	BlackRock	to conduct	new	activities,	acquire	or	divest	businesses	or	assets,	or	reconfigure	existing operations.	There	are	limits	on	the	ability	of	bank	subsidiaries	of	PNC	to	extend	credit	to or	conduct	other	transactions	with	BlackRock	or	its	funds.	PNC	and	its	subsidiaries	are also	subject	to	examination	by	various	banking	regulators,	which	results	in	examination reports	and	ratings	that	may	adversely	impact	the	conduct	and	growth	of	BlackRock's businesses.

The	Federal	Reserve	has	broad	enforcement	authority	over	BlackRock,	including	the power	to	prohibit	BlackRock	from	conducting	any	activity	that,	in	the	Federal	Reserve's opinion,	is	unauthorized	or	constitutes	an	unsafe	or	unsound	practice	in	conducting BlackRock's	business.	The	Federal	Reserve	may	also	impose	substantial	fines	and other	penalties	for	violations	of	applicable	banking	laws,	regulations	and	orders.	The DFA	strengthened	the	Federal	Reserve's	supervisory	and	enforcement	authority	over	a bank	holding	company's	non-bank	affiliates,	such	as	BlackRock.

Any	failure	of	PNC	to	maintain	its	status	as	a	financial	holding	company	could	result	in substantial	limitations	on	certain	BlackRock	activities	and	its	growth.	Such	a	change	of status	could	be	caused	by	any	failure	of	PNC	or	one	of	PNC's	bank	subsidiaries	to remain	"well	capitalized"	and	"well	managed,"	by	any	examination	downgrade	of	one	of PNC's	bank	subsidiaries,	or	by	any	failure	of	one	of	PNC's	bank	subsidiaries	to maintain	a	satisfactory	rating	under	the	Community	Reinvestment	Act.

# NON-U.S.	REGULATION

BlackRock's	international	operations	are	subject	to	the	laws	and	regulations	of	non-U.S. jurisdictions	and	non-U.S.	regulatory	agencies	and	bodies	and,	in	certain	cases,	are affected	by	U.S.	laws	and	regulations	that	have	extra-territorial	application.	As BlackRock	continues	to	expand	its	international	presence,	a	number	of	its	subsidiaries and	international	operations	have	become	subject	to	regulatory	frameworks	comparable to	those	affecting	its	operations	in	the	United	States.

The	Financial	Conduct	Authority	(the	"FCA")	currently	regulates	certain	BlackRock subsidiaries	in	the	United	Kingdom,	and	branches	of	its	U.K.	regulated	entities	in	the EU,	and	the	Prudential	Regulation	Authority	(the	"PRA")	also	regulates	one	BlackRock subsidiary	in	the	United	Kingdom.	Authorization	by	the	FCA	and/or	the	PRA	is	required to	conduct	any	financial	services	related	business	in	the	United	Kingdom	under	the Financial	Services	and	Markets	Act	2000.	The	FCA's	rules	made	under	that	Act	govern a	firm's	capital	resources	requirements,	senior	management	arrangements,

conduct	of	business,	interaction	with	clients,	and	systems	and	controls,	whereas	the rules	of	the	PRA	focus	solely	on	the	prudential	requirements	imposed	on	firms.	The FCA	supervises	the	Company's	U.K.-regulated	subsidiaries	through	a	combination	of proactive	engagement,	event-driven	and	reactive	supervision	and	thematic	based reviews	—	in	order	to	monitor	the	Company's	compliance	with	regulatory	requirements. Breaches	of	the	FCA's	rules	may	result	in	a	wide	range	of	disciplinary	actions	against the	Company's	U.K.-regulated	subsidiaries	and/or	its	employees.

In	addition	to	the	above,	the	Company's	U.K.-regulated	subsidiaries	and	other European	subsidiaries	and	branches,	must	comply	with	the	pan-European	regulatory regime	established	by	the	Markets	in	Financial	Instruments	Directive	("MiFID"),	which became	effective	on	November	1,	2007	and	regulates	the	provision	of	investment services	and	activities	throughout	the	EEA,	as	well	as	the	Capital	Requirements Directive,	which	delineates	regulatory	capital	requirements.	Revised	obligations	on capital	resources	for	banks	and	certain	investment	firms	apply	as	of	January	1,	2014. These	include	requirements	not	only	on	capital,	but	address	matters	of	governance	and remuneration	as	well.	These	will	have	a	direct	effect	on	some	of	BlackRock's	European operations.	MiFID	sets	out	detailed	requirements	governing	the	organization	and conduct	of	business	of	investment	firms	and	regulated	markets.	It	also	includes	pre-	and post-trade	transparency	requirements	for	equity	markets	and	extensive	transaction reporting	requirements.

The	United	Kingdom	has	adopted	the	MiFID	rules	into	national	legislation	and	FCA regulations,	as	have	those	other	European	jurisdictions	in	which	BlackRock	has	a presence	(excluding	Switzerland	which	is	not	part	of	the	EU	or	EEA).	A	review	of	MiFID by	the	European	Commission	has	led	to	the	publication	of	a	draft	amended	Directive and	a	draft	new	Markets	in	Financial	Instruments	Regulation.	The	proposals,	which	are currently	being	finalized,	are	likely	to	result	in	changes	to	pre-	and	post-trade	reporting obligations	and	an	expansion	of	the	types	of	instruments	subject	to	these	requirements. They	may	affect	the	buying	and	selling	of	derivatives	by	moving	most	derivative	trading onto	regulated	trading	venues	and	may	control	the	activities	of	algorithmic	trading.	The proposals	may	also	result	in	changes	to	conduct	of	business	requirements	including selling	practices,	intermediary	inducements	and	client	categorization.	The	proposals also	envisage	giving	the	European	Commission	power	to	ban	certain	products	and services.	A	further	EU	regulation,	Regulation	(EU)	No	648/2012	of	the	European Parliament	and	of	the	Council	of	July	4,	2012	on	OTC	derivatives,	central counterparties	and	trade	repositories,	was	adopted	in	August	2012,	and	requires	(i)	the central	clearing	of	standardized	OTC	derivatives,	(ii)	the	application	of	risk-mitigation techniques	to	non-centrally	cleared	OTC	derivatives	and	(iii)	the	reporting	of	all derivative	contracts	from	February	2014.

In	addition,	the	FCA	will	introduce	rules	in	April	2014	that	ban	payments	by	product providers	to	distribution	platforms	for	both	advised	and	non-advised	business.	These rules	follow	on	from	the	retail	distribution	review	that	came	into	effect	in	December	2012 and	changed	how	retail	clients	pay	for	investment	advice.	The	FCA	also	has	proposed a	prohibition	on	the	use	of	dealing	commissions	to	pay	for	corporate	access.	Final	rules are	expected	to	be	issued	in	mid-2014	along	with	a	discussion	paper	on	the	broader use	of	dealing	commissions.

In	the	aftermath	of	the	financial	crisis,	the	European	Commission	set	out	a	detailed	plan for	EU	financial	reform,	outlining	a	number	of	initiatives	to	be	reflected	in	new	or updated	directives,	regulations	and	recommendations	of	which	the	MiFID	review (mentioned	above)	was	a	part.	These,	together	with	the	changes	contemplated	by	the AIFMD	(mentioned	above),	will	have	direct	and	indirect	effects	on	BlackRock's operations	in	the	EEA.

The	European	Commission	has	also	published	proposals	to	replace	the	Market	Abuse Directive	with	a	regulation	on	insider	dealing	and	market	manipulation	and	with	an accompanying	directive	on	criminal	sanctions.	The	Regulation	has	now	been	largely agreed,	but	an	implementation	date	remains	outstanding	as	it	will	be	linked	to	the commencement	of	the	revised	MiFID	rules.

The	next	iteration	of	the	Undertakings	for	Collective	Investment	in	Transferable Securities	Directive	("UCITS	IV"),	was	required	to	be	adopted	in	the	national	law	of each	EU	member	state	by	July	1,	2011.	The	United	Kingdom	has	adopted	UCITS	IV requirements	into	national	legislation	and	FCA	regulation.	Luxembourg	and	Ireland have	also	adopted	UCITS	IV	into	their	national	legislation.	However,	several	other	EU member	states	are	still	in	various	stages	of	the	adoption	process.	UCITS	IV	introduced new	requirements	including	a	requirement	on	UCITS	funds	to	provide	a	key	investor information	document.	Recent	European	Commission	consultations	have	addressed retail	investor	protection	issues,	including	UCITS	V,	which	considers,	among	other items,	custodial	liability,	and	UCITS	VI,	which	includes	proposals	on	depositaries	and product	management.	A	separate	proposed	regulation	on	money	market	funds	has	also been	published	and	would,	if	adopted,	have	a	significant	impact	on	BlackRock's European	money	market	fund	offerings.

Proposals	on	packaged	retail	investment	products	("PRIPs")	are	to	be	implemented through	the	strengthening	of	MiFID	standards	(for	non-insurance	PRIPs),	revisions	to the	Insurance	Mediation	Directive's	selling	standard	(for	all	insurance-based	PRIPs) and	new	investor	disclosure	requirements	for	all	PRIPs	though	a	separate	EU legislative	process.

The	European	Securities	and	Markets	Authority	("ESMA")	has	published	guidelines	on ETFs	and	other	UCITS	issues	in	February	2013,	which	introduce	new	collateral management	requirements	for	UCITS	concerning	collateral	received	in	the	context	of derivatives	using	Efficient	Portfolio	Management	techniques	and	OTC	derivative transactions.	These	rules	will	require	significant	changes	and	implementation	is	due	by February	2014.

Certain	individual	EU	Member	States,	such	as	France	and	Italy,	have	enacted	national financial	transaction	taxes	("FTTs"),	and	a	group	of	Member	States	also	could	adopt	a FTT	under	an	EU	Enhanced	Cooperation	procedure	that	would	apply	in	those	Member States.	In	general,	any	tax	on	securities	and	derivatives	transactions	would	likely	have	a negative	impact	on	the	liquidity	of	the	securities	and	derivatives	markets,	could	diminish the	attractiveness	of	certain	types	of	products	that	we	manage	in	those	countries	and could	cause	clients	to	shift	assets	away	from	such	products.	A	FTT	could	significantly increase	the	operational	costs	of	our	entering	into,	on	behalf	of	our	clients,	securities and	derivatives	transactions	that	would	be	subjected	to	a	FTT,	which	would	adversely impact	our	revenues.

For	the	insurance	sector,	the	Solvency	II	process	will	increase	the	amount	of	capital that	insurers	will	have	to	set

aside	and	will	have	an	indirect	effect	on	fund	managers	with	insurance	clients.	The Solvency	II	process	has	been	delayed	from	an	original	compliance	date	of	January	1, 2014	but	agreement	has	now	been	confirmed	for	implementation	on	January	1,	2016.

In	addition	to	the	FCA,	the	activities	of	certain	BlackRock	subsidiaries,	branches,	and representative	offices	are	overseen	by	financial	services	regulators	in	Germany,	The Netherlands,	Ireland,	Luxembourg,	Switzerland,	Isle	of	Man,	Jersey,	France,	Belgium, Italy,	Poland,	South	Africa,	Spain	and	Sweden.	Regulators	in	these	jurisdictions	have authority	with	respect	to	financial	services	including,	among	other	things,	the	authority	to grant	or	cancel	required	licenses	or	registrations.	In	addition,	these	regulators	may subject	certain	BlackRock	subsidiaries	to	net	capital	requirements.	Other	BlackRock subsidiaries,	branches,	and	representative	offices	are	regulated	in	Japan,	Australia, China,	Hong	Kong,	Singapore,	Taiwan,	South	Korea,	India,	Dubai,	Cayman	Islands, Brazil,	Chile,	Mexico	and	Canada.

In	Japan,	a	BlackRock	subsidiary	is	subject	to	the	Financial	Instruments	and	Exchange Law	(the	"FIEL")	and	the	Law	Concerning	Investment	Trusts	and	Investment Corporations.	These	laws	are	administered	and	enforced	by	the	Japanese	Financial Services	Agency	(the	"JFSA"),	which	establishes	standards	for	compliance,	including capital	adequacy	and	financial	soundness	requirements,	customer	protection requirements	and	conduct	of	business	rules.	The	JFSA	is	empowered	to	conduct administrative	proceedings	that	can	result	in	censure,	fine,	the	issuance	of	cease	and desist	orders	or	the	suspension	or	revocation	of	registrations	and	licenses	granted under	the	FIEL.

In	Australia,	BlackRock's	subsidiaries	are	subject	to	various	Australian	federal	and	state laws	and	certain	subsidiaries	are	regulated	by	the	Australian	Securities	and Investments	Commission	("ASIC").	ASIC	regulates	companies	and	financial	services	in Australia	and	is	responsible	for	promoting	investor,	creditor	and	consumer	protection. Failure	to	comply	with	applicable	law	and	regulations	could	result	in	the	cancellation, suspension	or	variation	of	the	regulated	subsidiaries	licenses	in	Australia.

The	activities	of	certain	BlackRock	subsidiaries	in	Hong	Kong	are	subject	to	the Securities	and	Futures	Ordinance	(the	"SFO")	which	governs	the	securities	and	futures markets	and	regulates,	among	others,	offers	of	investments	to	the	public	and	provides for	the	licensing	of	intermediaries.	The	SFO	is	administered	by	the	Securities	and Futures	Commission	(the	"SFC").	The	SFC	is	also	empowered	under	the	SFO	to establish	standards	for	compliance	as	well	as	codes	and	guidelines.	The	relevant BlackRock	subsidiaries	and	the	employees	conducting	any	of	the	regulated	activities specified	in	the	SFO	are	required	to	be	licensed	with	the	SFC,	and	are	subject	to	the rules,	codes	and	guidelines	issued	by	the	SFC	from	time	to	time.	Failure	to	comply	with the	applicable	laws,	regulations,	codes	and	guidelines	issued	by	the	SFC	could	result	in the	suspension	or	revocations	of	the	licenses	granted	by	the	SFC.

There	are	parallel	legal	and	regulatory	arrangements	in	force	in	many	other	non-U.S. jurisdictions	where	BlackRock's	subsidiaries	are	authorized	to	conduct	business. Among	the	various	international	regulations	to	which	BlackRock	is	subject,	are	the extensive	and	increasingly	stringent	regulatory	reporting	requirements	that	necessitate the	monitoring	and	reporting	of	issuer	exposure	levels	(thresholds)	across	the	holdings of	managed	funds	and	accounts	and	those	of	the	Company.

# AVAILABLE	INFORMATION

BlackRock	files	annual,	quarterly	and	current	reports,	proxy	statements	and	all amendments	to	these	reports	and	other	information	with	the	SEC.	BlackRock	makes available	free-of-charge,	on	or	through	its	website	at	http://www.blackrock.com,	the Company's	Annual	Reports	on	Form	10-K,	Quarterly	Reports	on	Form	10-Q,	Current Reports	on	Form	8-K,	proxy	statements	and	all	amendments	to	those	filings,	as	soon as	reasonably	practicable	after	such	material	is	electronically	filed	with	or	furnished	to the	SEC.	The	Company	also	makes	available	on	its	website	the	charters	for	the	Audit Committee,	Management	Development	and	Compensation	Committee,	Nominating	and Governance	Committee	and	Risk	Committee	of	the	Board	of	Directors,	its	Code	of Business	Conduct	and	Ethics,	its	Code	of	Ethics	for	Chief	Executive	and	Senior Financial	Officers	and	its	Corporate	Governance	Guidelines.	Further,	BlackRock	will provide,	without	charge,	upon	written	request,	a	copy	of	the	Company's	Annual	Reports on	Form	10-K,	Quarterly	Reports	on	Form	10-Q,	Current	Reports	on	Form	8-K,	proxy statements	and	all	amendments	to	those	filings	as	well	as	the	committee	charters,	its Code	of	Business	Conduct	and	Ethics,	its	Code	of	Ethics	for	Chief	Executive	and Senior	Financial	Officers	and	its	Corporate	Governance	Guidelines.	Requests	for copies	should	be	addressed	to	Investor	Relations,	BlackRock,	Inc.,	55	East	52nd	Street, New	York,	New	York	10055.	Investors	may	read	and	copy	any	document	BlackRock files	at	the	SEC's	Public	Reference	Room	at	100	F	Street	N.E.,	Washington,	D.C. 20549.	Please	call	1-800-SEC-0330	for	further	information	on	the	operation	of	the Public	Reference	Room.	Reports,	proxy	statements	and	other	information	regarding issuers	that	file	electronically	with	the	SEC,	including	BlackRock's	filings,	are	also available	to	the	public	from	the	SEC's	website	at	http://www.sec.gov.

# Item	1A.	Risk	Factors

As	a	leading	investment	management	firm,	risk	is	an	inherent	part	of	BlackRock's business.	Global	markets,	by	their	nature,	are	prone	to	uncertainty	and	subject participants	to	a	variety	of	risks.	While	BlackRock	devotes	significant	resources	across all	of	its	operations	to	identify,	measure,	monitor,	manage	and	analyze	market, operating	and	compliance	risks,	BlackRock's	business,	financial	condition,	operating results	and	nonoperating	results	could	be	materially	adversely	affected	and	the Company's	stock	price	could	decline	as	a	result	of	any	of	these	risks	and	uncertainties, including	the	ones	discussed	below.

# MARKET	AND	EXTERNAL	RISKS

# Changes	in	the	value	levels	of	the	capital,	commodities	or	currency	markets	or other	asset	classes	could	adversely	impact	revenues	and	earnings.

BlackRock's	investment	management	revenues	are	primarily	comprised	of	fees	based on	a	percentage	of	the	value	of	assets	under	management	("AUM")	and,	in	some	cases, performance	fees	normally	expressed	as	a	percentage	of	the	returns	in	excess	of	a benchmark.	Numerous	factors,	including	movements	in	equity,	debt,	commodity,	real estate	and	alternative	investment	asset	prices,	interest	rates	or	foreign	exchange	rates could	cause:

•	the	value	of	AUM	to	decrease;

•	the	returns	realized	on	AUM	to	decrease;

•	clients	to	withdraw	funds	in	favor	of	products	that	they	perceive	offer	greater opportunity	than	BlackRock's	products;

•	clients	to	rebalance	assets	away	from	products	that	BlackRock	manages	into products	that	it	may	not	manage;

•	clients	to	rebalance	assets	away	from	products	that	earn	higher	fees	into	products with	lower	fees;	and

•	an	impairment	to	the	value	of	intangible	assets	and	goodwill.

The	occurrence	of	any	of	these	events	could	result	in	lower	investment	advisory, management,	administration	and	performance	fees	and	cause	the	Company's	revenues and	earnings	to	decline.

# Competitive	fee	pressures	could	reduce	revenues	and	profit	margins.

The	investment	management	industry	is	highly	competitive	and	has	relatively	low barriers	to	entry.	To	the	extent	that	BlackRock	is	forced	to	compete	on	the	basis	of price,	fee	reductions	on	existing	or	future	new	business	could	cause	revenues	and	profit margins	to	decline.

# Failure	of	other	financial	institutions	could	adversely	affect	BlackRock's earnings.

The	products	and	accounts	that	BlackRock	manages	have	exposure	to	many	different industries	and	counterparties,	and	BlackRock	routinely	executes	transactions	with counterparties	in	the	financial	services	industry,	including	brokers	and	dealers, commercial	banks,	investment	banks,	clearing	organizations,	mutual	and	hedge	funds, and	other	institutional	clients.	Many	of	these	transactions	expose	BlackRock's	products and	accounts	to	credit	risk	in	the	event	of	default	of	its	counterparty.	While	BlackRock regularly	assesses	risks	posed	by	these	counterparties,	such	counterparties	may	be subject	to	sudden	swings	in	the	financial	and	credit	markets	that	may	impair	their	ability to	perform.	Such	a	failure	could	negatively	impact	the	performance	of	BlackRock's products	and	accounts,	which	could	lead	to	the	loss	of	clients	and	a	decline	in BlackRock's	revenues	and	earnings.

# The	failure	or	negative	performance	of	products	of	other	financial	institutions could	lead	to	reduced	AUM	in	similar	products	of	BlackRock	without	regard	to	the performance	of	BlackRock's	products.

The	failure	or	negative	performance	of	products	of	other	financial	institutions	could	lead to	a	loss	of	confidence	in	similar	products	of	BlackRock	without	regard	to	the performance	of	BlackRock's	products.	Such	a	negative	perception	could	lead	to withdrawals,	redemptions	and	liquidity	issues	in	such	products	and	have	a	material adverse	impact	on	the	Company's	AUM,	revenues	and	earnings.

# BlackRock's	investment	advisory	contracts	may	be	terminated	or	may	not	be renewed	by	clients	and	the	liquidation	of	certain	funds	may	be	accelerated	at	the option	of	investors.

Separate	account	and	commingled	trust	clients	may	terminate	their	investment management	contracts	with	BlackRock	or	withdraw	funds	on	short	notice.	The Company	experiences	routine	turnover	in	commingled	trust	funds	and	separate accounts	and	could,	in	the	future,	lose	significant	AUM	in	funds	and	accounts	due	to various	circumstances	such	as	adverse	market	conditions,	fee	competition	or	poor performance.

Additionally,	BlackRock	manages	its	U.S.	mutual	funds,	closed-end	and	exchange- traded	funds	under	management	contracts	with	the	funds	that	must	be	renewed	and approved	by	the	funds'	boards	of	directors	annually	and	may	be	terminated	by	them without	cause	on	short	notice.	Certain	additional	services,	such	as	securities	lending, also	require	approval	by	the	funds'	boards	of	directors	annually.	A	majority	of	the directors	of	each	such	fund	are	independent	from	BlackRock.	Consequently,	there	can be	no	assurance	that	the	board	of	directors	of	each	fund	managed	by	the	Company	will not	terminate	BlackRock	or	will	approve	the	fund's	management	contract	each	year	or will	not	condition	its	approval	on	the	terms	of	the	management	contract	being	revised	in a	way	that	is	adverse	to	the	Company.

Further,	the	governing	agreements	of	many	of	the	Company's	private	investment	funds generally	provide	that,	subject	to	certain	conditions,	investors	in	those	funds,	and	in some	cases	independent	directors	of	those	funds,	may	remove	BlackRock	as	the investment	adviser,	general	partner	or	the	equivalent	of	the	fund	or	liquidate	the	fund without	cause	by	a	simple	majority	vote,	resulting	in	a	reduction	in	the	management	or performance	fees	as	well	as	the	total	carried	interest	BlackRock	could	earn.

# Operating	in	international	markets	increases	BlackRock's	operational,	regulatory and	other	risks.

As	a	result	of	BlackRock's	extensive	international	business	activities,	the	Company faces	associated	operational,	regulatory,	reputational	and	foreign	exchange	rate	risks. The	failure	of	the	Company's	systems	of	internal	control	to	properly	mitigate	such additional	risks,	or	of	its	operating	infrastructure	to	support	such	international	activities, could	result	in	operational	failures	and	regulatory	fines	or	sanctions,	which	could	cause the	Company's	earnings	to	decline.

# RISKS	RELATED	TO	BLACKROCK'S	BUSINESS	AND	INTERNAL	OPERATIONS

# Poor	investment	performance	could	lead	to	the	loss	of	clients	and	a	decline	in revenues	and	earnings.

The	Company's	management	believes	that	investment	performance,	including	the efficient	delivery	of	beta	for	passively	managed	products,	is	one	of	the	most	important factors	for	the	growth	and	retention	of	AUM.	Poor	investment	performance	relative	to applicable	portfolio	benchmarks	or	to	competitors	could	reduce	revenues	and	cause earnings	to	decline	as	a	result	of:

•	existing	clients	withdrawing	funds	in	favor	of	better	performing	products,	which could	result	in	lower	investment	advisory	and	administration	fees;

•	the	diminishing	ability	to	attract	funds	from	existing	and	new	clients;

•	the	Company	earning	minimal	or	no	performance	fees;	and

# Performance	fees	may	increase	volatility	of	both	revenue	and	earnings.

A	portion	of	BlackRock's	revenues	is	derived	from	performance	fees	on	investment	and risk	management	advisory	assignments.	Performance	fees	represented

$561	million,	or	6%,	of	total	revenue	for	the	year	ended	December	31,	2013.	In	most cases,	performance	fees	are	based	on	relative	or	absolute	investment	returns,	although in	some	cases	they	are	based	on	achieving	specific	service	standards.	Generally,	the Company	is	entitled	to	performance	fees	only	if	the	returns	on	the	related	portfolios exceed	agreed-upon	periodic	or	cumulative	return	targets.	If	these	targets	are	not exceeded,	performance	fees	for	that	period	will	not	be	earned	and,	if	targets	are	based on	cumulative	returns,	the	Company	may	not	earn	performance	fees	in	future	periods.

# Changes	in	the	value	of	seed	and	co-investments	that	BlackRock	owns	could affect	BlackRock's	nonoperating	income	or	earnings	and	could	increase	the volatility	of	its	earnings.

At	December	31,	2013,	BlackRock's	net	economic	investment	exposure	of approximately	$1.6	billion	in	its	investments	(see	"Item	7	—	Management's	Discussion and	Analysis	of	Financial	Condition	and	Results	of	Operations-Investments")	primarily resulted	from	co-investments	and	seed	investments	in	its	sponsored	investment	funds. A	decline	in	the	prices	of	equity	or	debt	securities,	or	the	value	of	real	estate	or	other alternative	investments	could	lower	the	value	of	these	investments,	increase	the volatility	of	BlackRock's	earnings	and,	if	such	prices	decline	or	BlackRock	realizes losses,	could	result	in	a	decline	in	earnings.

Additionally,	the	Company	may	generate	realized	and	unrealized	capital	losses	on	such seed	investments	and	co-investments.	U.S.	Federal	realized	capital	losses	may	be carried	back	three	years	and	carried	forward	five	years	and	offset	against	realized capital	gains	for	federal	income	tax	purposes.	The	Company	has	unrealized	capital losses	for	which	a	deferred	tax	asset	has	been	established.	In	the	event	such unrealized	losses	are	realized,	the	Company	may	not	be	able	to	offset	such	losses within	the	carryback	or	carryforward	period	or	from	future	realized	capital	gains,	in which	case	the	deferred	tax	asset	will	not	be	realized.	The	failure	to	utilize	the	deferred tax	asset	could	materially	increase	BlackRock's	income	tax	expense.

# Failure	to	maintain	adequate	infrastructure	and	a	technological	advantage	could lead	to	a	loss	of	clients	and	could	impede	BlackRock's	productivity	and	growth.

The	Company's	infrastructure,	including	its	technological	capacity,	data	centers,	and office	space,	is	vital	to	the	competitiveness	of	its	business.	The	failure	to	maintain	an adequate	infrastructure	commensurate	with	the	size	and	scope	of	its	business, including	any	expansion,	or	the	outage	or	failure	of	existing	infrastructure,	could materially	impact	operations	and	impede	the	Company's	productivity	and	growth,	which could	cause	the	Company's	earnings	to	decline	or	could	impact	the	Company's	ability	to comply	with	regulatory	obligations	leading	to	regulatory	fines	and	sanctions.

A	key	element	to	BlackRock's	continued	success	is	the	ability	to	maintain	a technological	advantage	in	providing	the	sophisticated	risk	analytics	incorporated	into BlackRock's	Aladdin	technology	platform	that	support	investment	advisory	and	BRS clients.	Moreover,	the	Company's	technological	and	software	advantage	is	dependent on	a	number	of	third	parties	who	provide	various	types	of	data	and	software.	The	failure of	these	third	parties	to	provide	such	data	or	software	could	result	in	operational difficulties

and	adversely	impact	BlackRock's	ability	to	provide	services	to	its	investment	advisory and	BRS	clients.	There	can	be	no	assurance	that	the	Company	will	be	able	to	maintain this	technological	advantage	or	be	able	to	effectively	protect	and	enforce	its	intellectual property	rights	in	these	systems	and	processes.

# Failure	to	implement	effective	information	and	cyber	security	policies, procedures	and	capabilities	could	disrupt	operations	and	cause	financial	losses that	could	result	in	a	decrease	in	BlackRock's	earnings.

BlackRock	is	dependent	on	the	effectiveness	of	its	information	and	cyber	security policies,	procedures	and	capabilities	to	protect	its	computer	and	telecommunications systems	and	the	data	that	reside	on	or	are	transmitted	through	them.	An	externally caused	information	security	incident,	such	as	a	hacker	attack,	virus	or	worm,	or	an internally	caused	issue,	such	as	failure	to	control	access	to	sensitive	systems,	could materially	interrupt	business	operations	or	cause	disclosure	or	modification	of	sensitive or	confidential	client	or	competitive	information	and	could	result	in	material	financial loss,	loss	of	competitive	position,	regulatory	actions,	breach	of	client	contracts, reputational	harm	or	legal	liability,	which,	in	turn,	could	cause	a	decline	in	the Company's	earnings.

# Failure	to	maintain	adequate	business	continuity	plans	could	have	a	material adverse	impact	on	BlackRock	and	its	products.

A	significant	portion	of	BlackRock's	critical	business	operations	is	concentrated	in	a	few geographic	areas,	including	San	Francisco,	California,	New	York,	New	York	and London,	England.	A	major	earthquake,	hurricane,	fire,	terrorist	act	or	other	catastrophic event	in	any	of	these	locations	could	result	in	disruption	to	the	business.	The	failure	of the	Company	to	maintain	updated	adequate	business	continuity	plans,	including	secure backup	facilities,	systems	and	personnel	could	impede	the	Company's	ability	to	operate during,	or	could	effect,	a	disruption,	which	could	cause	the	Company's	earnings	to decline.

# Failure	to	maintain	adequate	liquidity	for	general	business	operations	could adversely	impact	BlackRock's	financial	condition	and	growth	prospects.

BlackRock's	ability	to	meet	anticipated	cash	needs	depends	upon	a	number	of	factors, including	its	ability	to	maintain	and	grow	AUM,	its	creditworthiness	and	operating	cash flows.	Failure	to	maintain	adequate	liquidity	could	lead	to	unanticipated	costs	and	force BlackRock	to	revise	existing	strategic	and	business	initiatives.	BlackRock's	access	to capital	markets	and	its	ability	to	issue	public	or	private	debt	on	reasonable	terms	may be	limited	by	adverse	market	conditions,	a	reduction	in	its	long-	or	short-term	credit ratings	as	well	as	changes	in	government	regulations,	including	tax	and	interest	rates. Failure	to	obtain	funds	and/or	financing	could	adversely	impact	BlackRock's	financial condition	and	prospects	for	growth.

# Failure	to	comply	with	client	contractual	requirements	and/or	guidelines	could result	in	damage	awards	against	BlackRock	and	loss	of	revenues	due	to	client terminations.

When	clients	retain	BlackRock	to	manage	assets	or	provide	products	or	services	on their	behalf,	they	typically	specify	guidelines	or	contractual	requirements	that	the Company	is	required	to	observe	in	the	provision	of	its	services.	A	failure

to	comply	with	these	guidelines	or	contractual	requirements	could	result	in	damage	to BlackRock's	reputation	or	in	its	clients	seeking	to	recover	losses,	withdrawing	their assets	or	terminating	their	contracts,	any	of	which	could	cause	the	Company's	AUM, revenues	and	earnings	to	decline.

# Failure	to	identify	errors	in	the	quantitative	models	BlackRock	utilizes	to	manage its	business	could	adversely	impact	product	performance	and	client relationships.

BlackRock	employs	various	quantitative	models	to	support	its	investment	decisions	and allocations,	including	those	related	to	risk	assessment,	portfolio	management,	trading and	hedging	activities	and	product	valuations.	Any	errors	in	the	underlying	models	or model	assumptions	could	have	unanticipated	and	adverse	consequences	on BlackRock's	business	and	reputation.

# The	determination	to	provide	support	to	particular	products	from	time	to	time may	reduce	earnings	or	other	investments	in	the	business.

BlackRock	may,	at	its	option,	from	time	to	time	support	investment	products	through capital	or	credit	support	or	indemnifications.	Such	support	and	indemnifications	utilize capital	that	would	otherwise	be	available	for	other	corporate	purposes.	Losses	or prohibitions	on	such	support	and	indemnifications,	or	failure	to	have	or	devote	sufficient capital	to	support	products,	could	have	an	adverse	impact	on	revenues	and	earnings.

# Failure	to	manage	risks	in	operating	BlackRock's	securities	lending	program	for clients	could	lead	to	a	loss	of	clients	and	a	decline	in	revenues	and	liquidity.

On	behalf	of	certain	clients,	BlackRock	lends	securities	to	banks	and	broker-dealers.	In these	securities	lending	transactions,	the	borrower	is	required	to	provide	and	maintain collateral	at	or	above	regulatory	minimums.	Securities	on	loan	are	marked	to	market daily	to	determine	if	the	borrower	is	required	to	pledge	additional	collateral.	BlackRock must	manage	risks	associated	with	(i)	ensuring	that	the	value	of	the	collateral	held against	the	securities	on	loan	does	not	decline	in	value	or	become	illiquid	and	that	its nature	and	value	complies	with	regulatory	requirements	and	investment	requirements; (ii)	the	potential	that	a	borrower	defaults	or	does	not	return	a	loaned	security	on	a	timely basis;	and	(iii)	errors	in	the	settlement	of	securities,	daily	mark-to-market	valuations	and collateral	collection.	The	failure	of	the	Company's	controls	to	mitigate	these	risks	could result	in	financial	losses	for	the	Company's	clients	that	participate	in	its	securities lending	programs	as	well	as	for	the	Company.

# The	determination	to	provide	securities	lending	indemnifications	may	reduce earnings	or	other	investments	in	the	business.

BlackRock	has	issued	certain	indemnifications	to	certain	securities	lending	clients against	potential	loss	resulting	from	a	borrower's	failure	to	fulfill	its	obligations	should the	value	of	the	collateral	pledged	by	the	borrower	at	the	time	of	a	potential	default	be insufficient	to	cover	the	borrower's	obligations	under	the	securities	lending	agreement. These	indemnifications	cover	only	the	collateral	shortfall,	and	do	not	guarantee, assume	or	otherwise	insure	the	investment	performance	or	return	of	any	cash	collateral vehicle	into	which	securities	lending	cash	collateral	is	invested.	The	amount	of securities	on	loan	as	of	December	31,	2013	and	subject	to

indemnification	was	$118.3	billion.	BlackRock	held,	as	agent,	cash	and	securities totaling	$124.6	billion	as	collateral	for	indemnified	securities	on	loan	at	December	31, 2013.	BlackRock	expects	indemnified	balances	to	continue	to	increase	over	time.	The failure	of	the	Company	to	mitigate	these	risks	could	result	in	financial	losses	for	the Company's	clients	that	participate	in	its	securities	lending	programs	as	well	as	for	the Company.

# Failure	to	establish	adequate	controls	and	risk	management	policies,	or	fraud,	or the	circumvention	of	controls	and	policies,	could	have	an	adverse	effect	on BlackRock's	reputation	and	financial	position.

Although	BlackRock	has	adopted	a	comprehensive	risk	management	process	and continues	to	enhance	various	controls,	procedures,	policies	and	systems	to	monitor	and manage	risks,	it	cannot	assure	that	such	controls,	procedures,	policies	and	systems	will successfully	identify	and	manage	internal	and	external	risks	to	its	businesses. BlackRock	is	subject	to	the	risk	that	its	employees,	contractors	or	other	third	parties may	deliberately	seek	to	circumvent	established	controls	to	commit	fraud	or	act	in	ways that	are	inconsistent	with	the	Company's	controls,	policies	and	procedures.	Persistent or	repeated	attempts	involving	fraud,	conflicts	of	interests	or	circumvention	of	policies and	controls	could	have	a	materially	adverse	impact	on	BlackRock's	reputation	and could	lead	to	costly	regulatory	inquiries.

# Additional	acquisitions	may	decrease	earnings	and	harm	the	Company's competitive	position	if	not	successful.

BlackRock	employs	a	variety	of	strategies	intended	to	enhance	earnings	and	expand product	offerings	in	order	to	improve	profit	margins.	These	strategies	have	included hiring	smaller-sized	investment	teams,	acquisitions	of	investment	management businesses,	such	as	MGPA	and	Credit	Suisse's	ETF	franchise,	and	other	small	and medium-sized	strategic	acquisitions	to	expand	geographical	reach,	access	new	clients or	pursue	other	business	and	financial	opportunities.	These	strategies	may	not	be effective,	and	failure	to	successfully	develop	and	implement	these	strategies	may decrease	earnings	and	harm	certain	aspects	of	the	Company's	competitive	position	in the	investment	management	industry.	These	strategic	transactions	also	involve	a number	of	financial	accounting,	tax,	regulatory	and	operational	challenges	and uncertainties,	including	the	assumption	of	pre-existing	liabilities,	and	failure	to	identify and	mitigate	associated	risks	through	due	diligence	and	indemnification	provisions could	adversely	impact	BlackRock's	earnings	and	reputation.	In	the	event	BlackRock pursues	additional	acquisitions,	it	may	not	be	able	to	find	suitable	businesses	to	acquire at	acceptable	prices,	and	it	may	not	be	able	to	successfully	integrate	or	realize	the intended	benefits	from	such	acquisitions.

# The	development	of	new	products	and	services	may	expose	BlackRock	to additional	costs	or	operational	risk.

BlackRock's	financial	performance	depends,	in	part,	on	its	ability	to	develop,	market and	manage	new	investment	products	and	services.	The	development	and	introduction of	new	products	and	services	may	require	significant	time	and	resources	as	well	as ongoing	support	and	investment.	Substantial	risk	and	uncertainties	are	associated	with the	introduction	of	new	products	and	services,	including	the	implementation	of	new	and appropriate	operational	controls	and	procedures,	shifting	client	and	market	preferences, the

introduction	of	competing	products	or	services	and	compliance	with	regulatory requirements.	Failure	to	successfully	manage	these	risks	may	cause	BlackRock's revenues	and	costs	to	fluctuate	and	could	have	an	adverse	impact	on	its	business	and reputation.

# Loss	of	employees	could	lead	to	the	loss	of	clients	and	a	decline	in	revenues.

The	ability	to	attract	and	retain	quality	personnel	has	contributed	significantly	to BlackRock's	growth	and	success	and	is	important	to	attracting	and	retaining	clients.	The market	for	qualified	fund	managers,	investment	analysts,	financial	advisers	and	other professionals	is	competitive.	There	can	be	no	assurance	that	the	Company	will	be successful	in	its	efforts	to	recruit	and	retain	required	personnel.	Loss	of	personnel	could have	a	material	adverse	effect	on	the	Company.

# RISKS	RELATED	TO	KEY	RELATIONSHIPS

# The	failure	of	a	key	vendor	to	BlackRock	to	fulfill	its	obligations	could	have	a material	adverse	effect	on	BlackRock	and	its	products.

BlackRock	depends	on	a	number	of	key	vendors	for	various	fund	administration, accounting,	custody,	risk	analytics,	market	data,	market	indices	and	transfer	agent	roles and	other	operational	needs.	The	failure	or	inability	of	BlackRock	to	diversify	its	sources for	key	services	or	the	failure	of	any	key	vendors	to	fulfill	their	obligations	could	lead	to operational	and	regulatory	issues	for	the	Company	and	in	certain	of	its	products,	which could	result	in	reputational	harm	and	financial	losses	for	the	Company.

# Bank	of	America/Merrill	Lynch	is	an	important	distributor	of	BlackRock's products,	and	the	Company	is,	therefore,	subject	to	risks	associated	with	the business	of	Bank	of	America/Merrill	Lynch.

Under	a	global	distribution	agreement	entered	into	with	Merrill	Lynch	in	2006,	Merrill Lynch,	which	merged	with	Bank	of	America	on	January	1,	2009,	provides	distribution, portfolio	administration	and	servicing	for	certain	BlackRock	investment	management products	and	services	through	its	various	distribution	channels.	The	Company	may	not be	successful	in	distributing	products	through	Merrill	Lynch	or	in	distributing	its	products and	services	through	other	third-party	distributors.	If	BlackRock	is	unable	to	distribute	its products	and	services	successfully	or	if	it	experiences	an	increase	in	distribution- related	costs,	BlackRock's	business,	results	of	operations	or	financial	condition	may	be materially	and	adversely	affected.

# Loss	of	market	share	within	Merrill	Lynch's	Global	Wealth	&	Investment Management	business	could	harm	operating	results.

A	significant	portion	of	BlackRock's	revenue	has	historically	come	from	AUM	generated by	Merrill	Lynch's	Global	Wealth	&	Investment	Management	("GWIM")	business. BlackRock's	ability	to	maintain	a	strong	relationship	within	GWIM	is	material	to	the Company's	future	performance.	If	one	of	the	Company's	competitors	gains	significant additional	market	share	within	the	GWIM	retail	channel	at	the	expense	of	BlackRock, then	BlackRock's	business,	results	of	operations	or	financial	condition	may	be negatively	impacted.

# PNC	has	agreed	to	vote	as	a	stockholder	in	accordance	with	the	recommendation of	BlackRock's	Board	of	Directors,	and	certain	actions	will	require	special	board approval	or	the	prior	approval	of	PNC.

As	discussed	in	our	proxy	statement,	PNC	has	agreed	to	vote	all	of	its	voting	shares	in accordance	with	the	recommendation	of	BlackRock's	Board	of	Directors	in	accordance with	the	provisions	of	its	stockholder	agreement	with	BlackRock.	As	a	consequence,	if the	shares	held	by	PNC	constitute	a	substantial	portion	of	the	outstanding	voting shares,	matters	submitted	to	a	stockholder	vote	that	require	a	majority	or	a	plurality	of votes	for	approval,	including	elections	of	directors,	will	have	a	substantial	number	of shares	voted	in	accordance	with	the	determination	of	the	BlackRock	Board	of	Directors. This	arrangement	has	the	effect	of	concentrating	a	significant	block	of	voting	control over	BlackRock	in	its	Board	of	Directors,	whether	or	not	stockholders	agree	with	any particular	determination	of	the	Board.	At	December	31,	2013,	PNC	owned approximately	20.9%	of	BlackRock's	voting	common	stock.

As	discussed	in	our	proxy	statement,	pursuant	to	our	stockholder	agreement	with	PNC, the	following	may	not	be	done	without	prior	approval	of	all	of	the	independent	directors, or	at	least	two-thirds	of	the	directors,	then	in	office:

•	appointment	of	a	new	Chief	Executive	Officer	of	BlackRock;

•	any	merger,	issuance	of	shares	or	similar	transaction	in	which	beneficial ownership	of	a	majority	of	the	total	voting	power	of	BlackRock	capital	stock	would be	held	by	persons	different	than	those	currently	holding	such	majority	of	the	total voting	power,	or	any	sale	of	all	or	substantially	all	assets	of	BlackRock;

•	any	acquisition	of	any	person	or	business	which	has	a	consolidated	net	income after	taxes	for	its	preceding	fiscal	year	that	equals	or	exceeds	20%	of	BlackRock's consolidated	net	income	after	taxes	for	its	preceding	fiscal	year	if	such	acquisition involves	the	current	or	potential	issuance	of	BlackRock	capital	stock	constituting more	than	10%	of	the	total	voting	power	of	BlackRock	capital	stock	issued	and outstanding	immediately	after	completion	of	such	acquisition;

•	any	acquisition	of	any	person	or	business	constituting	a	line	of	business	that	is materially	different	from	the	lines	of	business	BlackRock	and	its	controlled affiliates	are	engaged	in	at	that	time	if	such	acquisition	involves	consideration	in excess	of	10%	of	the	total	assets	of	BlackRock	on	a	consolidated	basis;

•	except	for	repurchases	otherwise	permitted	under	the	stockholder	agreement,	any repurchase	by	BlackRock	or	any	subsidiary	of	shares	of	BlackRock	capital	stock such	that	after	giving	effect	to	such	repurchase	BlackRock	and	its	subsidiaries shall	have	repurchased	more	than	10%	of	the	total	voting	power	of	BlackRock capital	stock	within	the	12-month	period	ending	on	the	date	of	such	repurchase;

•	any	amendment	to	BlackRock's	certificate	of	incorporation	or	bylaws;	or •	any	matter	requiring	stockholder	approval	pursuant	to	the	rules	of	the	NYSE.

Additionally,	BlackRock	may	not	enter	into	any	of	the	following	transactions	without	the prior	approval	of	PNC:

•	any	sale	of	any	subsidiary	of	BlackRock,	the	annualized	revenues	of	which, together	with	the	annualized	revenues	of	any	other	subsidiaries	disposed	of	within the	same	year,	are	more	than	20%	of	the	annualized	revenues	of	BlackRock	for the	preceding	fiscal	year	on	a	consolidated	basis;

•	for	so	long	as	BlackRock	is	a	subsidiary	of	PNC	for	purposes	of	the	BHC	Act, entering	into	any	business	or	activity	that	is	prohibited	for	any	such	subsidiary under	the	BHC	Act;

•	any	amendment	of	any	provision	of	a	stockholder	agreement	between	BlackRock and	any	stockholder	beneficially	owning	greater	than	20%	of	BlackRock	capital stock	that	would	be	viewed	by	a	reasonable	person	as	being	adverse	to	PNC	or materially	more	favorable	to	the	rights	of	any	stockholder	beneficially	owning greater	than	20%	of	BlackRock	capital	stock	than	to	PNC;

•	any	amendment,	modification,	repeal	or	waiver	of	BlackRock's	certificate	of incorporation	or	bylaws	that	would	be	viewed	by	a	reasonable	person	as	being adverse	to	the	rights	of	PNC	or	more	favorable	to	the	rights	of	any	stockholder beneficially	owning	greater	than	20%	of	BlackRock	capital	stock,	or	any settlement	or	consent	in	a	regulatory	enforcement	matter	that	would	be reasonably	likely	to	cause	PNC	or	any	of	its	affiliates	to	suffer	regulatory disqualification,	suspension	of	registration	or	license	or	other	material	adverse regulatory	consequences;	or

•	a	voluntary	bankruptcy	or	similar	filing	by	BlackRock.

# PNC	owns	a	large	portion	of	BlackRock's	capital	stock.	Future	sales	of	our common	stock	in	the	public	market	by	the	Company	or	PNC	could	adversely affect	the	trading	price	of	our	common	stock.

As	of	December	31,	2013,	PNC	owned	21.9%	of	the	Company's	capital	stock.	The Company	has	entered	into	a	registration	rights	agreement	with	PNC.	The	registration rights	agreement	provides	PNC	with	the	right	to	cause	us	to	file	one	or	more	registration statements	for	the	resale	of	its	shares	of	capital	stock	and	cooperate	in	certain underwritten	offerings.	Sales	of	a	substantial	number	of	shares	of	our	common	stock	in the	public	market	pursuant	to	registration	rights	or	otherwise,	or	the	perception	that these	sales	might	occur,	could	cause	the	market	price	of	our	common	stock	to	decline.

# LEGAL	AND	REGULATORY	RISKS

# BlackRock	is	subject	to	extensive	regulation	in	the	United	States	and internationally.

BlackRock's	business	is	subject	to	extensive	regulation	in	the	United	States	and	around the	world.	See	the	discussion	under	"Item	1	–	Business	–	Regulation."	New	laws	or regulations,	or	changes	in	enforcement	of	existing	laws	or	regulations	in	the	United States	or	internationally,	could	adversely	impact	the	scope	or	profitability	of	BlackRock's business	activities.	Violation	of	applicable	laws	or	regulations	could	result	in	fines, temporary	or	permanent	prohibition	of	the	engagement	in	certain	activities,	reputational harm	and	related	client	terminations,

suspensions	of	personnel	or	revocation	of	their	licenses	or	bank	charter,	suspension	or termination	of	investment	adviser,	broker-dealer	or	other	registrations,	or	other sanctions,	which	could	have	a	material	adverse	effect	on	BlackRock's	reputation, business,	results	of	operations	or	financial	condition	and	cause	the	Company's	earnings to	decline.

# BlackRock	may	be	adversely	impacted	by	legal	and	regulatory	changes	required under	the	Dodd-Frank	Wall	Street	Reform	and	Consumer	Protection	Act	and other	U.S.	regulatory	reform	initiatives.

As	previously	mentioned,	in	July	2010,	the	Dodd-Frank	Wall	Street	Reform	and Consumer	Protection	Act	(the	"DFA")	was	signed	into	law.	The	DFA	is	expansive	in scope	and	requires	the	adoption	of	extensive	regulations	and	numerous	regulatory decisions	in	order	to	be	implemented.	The	adoption	of	these	regulations	and	decisions will	in	large	measure	determine	the	impact	of	the	DFA	on	BlackRock.	BlackRock	is continuing	to	review	what	impact	the	legislation	and	related	rule-making	will	have	on	its business,	financial	condition	and	results	of	operations.

The	DFA	charges	the	Board	of	Governors	of	the	Federal	Reserve	System	(the	"Federal Reserve")	with	establishing	enhanced	regulatory	requirements	for	nonbank	financial institutions	designated	as	"systemically	important"	by	the	Financial	Stability	Oversight Council	("FSOC").	Should	BlackRock	be	designated	a	systemically	important	financial institution	(a	"SIFI"),	it	could	be	subject	to	these	enhanced	prudential,	capital, supervisory	and	other	requirements,	which,	individually	or	in	the	aggregate,	could adversely	impact	BlackRock's	business	and	operations.

The	DFA	and	its	regulations	could	adversely	impact	the	scope	or	profitability	of BlackRock's	business	activities,	could	require	BlackRock	to	change	certain	business practices	and	could	expose	BlackRock	to	additional	costs	(including	compliance	and	tax costs).

Provisions	of	the	DFA	referred	to	as	the	"Volcker	Rule"	created	a	new	section	of	the BHC	Act	that	places	limitations	on	the	ability	of	banks	and	their	subsidiaries	to	engage in	proprietary	trading	and	to	invest	in	and	transact	with	certain	private	investment	funds, including	hedge	funds,	private	equity	funds	and	funds	of	funds	(collectively	"covered funds").	Final	regulations	implementing	the	Volcker	Rule	were	issued	on	December	10, 2013;	entities	subject	to	the	Volcker	Rule	must	conform	their	activities	to	the requirements	of	the	final	implementing	regulations	no	later	than	July	21,	2015,	subject to	the	granting	of	extensions	that	are	available	in	limited	circumstances.	Because BlackRock	is	treated	as	a	non-bank	subsidiary	of	PNC	under	the	Federal	Reserve's current	interpretation	of	the	BHC	Act,	BlackRock	will	be	required	to	comply	with	the Volcker	Rule.	The	Volcker	Rule	will	limit	BlackRock's	ability	to	invest	in	covered	funds, require	BlackRock	to	remove	its	name	from	the	name	of	its	covered	funds,	and	limit investments	in	covered	funds	by	BlackRock	employees,	among	other	restrictions. Depending	on	the	availability	of	statutory	extensions,	BlackRock	could	be	required	to sell	certain	seed	and	co-investments	that	it	holds,	including	at	a	discount,	depending	on market	conditions.	These	limitations	and	restrictions	could	disadvantage	BlackRock against	competitors	that	are	not	subject	to	the	Volcker	Rule	in	our	ability	to	attract clients	into	BlackRock	covered	funds	and	to	retain	employees.	Finally,	the	restrictions on	proprietary

trading	in	the	Volcker	Rule	could	impact	the	ability	of	our	trading	counterparties	to	make markets	and	provide	liquidity	in	certain	securities,	which	could	have	a	negative	impact on	our	ability	to	manage	funds	and	client	accounts	that	transact	in	those	securities.

Further,	the	full	implementation	of	regulations	under	the	DFA	relating	to	regulation	of swaps	and	derivatives	could	impact	the	manner	by	which	BlackRock-advised	funds	and accounts	use	and	trade	swaps	and	other	derivatives,	and	could	significantly	increase the	costs	of	derivatives	trading	conducted	by	BlackRock	on	behalf	of	its	clients. BlackRock	will	also	need	to	build	new	compliance	mechanisms	to	monitor	compliance with	SEC	and	Commodity	Futures	Trading	Commission	("CFTC")	rules	concerning, among	other	things,	the	registration	and	regulation	of	commodity	pool	operators	and commodity	trading	advisors	(and	the	accompanying	registration	and	regulation	of	such entities	by	the	National	Futures	Association),	the	applicability	of	CFTC	rules	and regulations	to	offshore	funds,	accounts	and	counterparties,	and	requirements	to centrally	clear	certain	swap	transactions	and	to	execute	certain	swap	transaction	only on	or	through	CFTC-registered	trading	venues.	BlackRock,	on	behalf	of	its	clients,	is also	preparing	for	the	implementation	of	trade	reporting,	documentation,	and	mandated central	clearing	of	swaps	requirements	in	the	EU	and	other	jurisdictions	globally. Inconsistencies	and	potential	contradictions	in	the	rules	adopted	by	various	global regulators	will	increase	the	operational	and	legal	risks	associated	with	trading	in derivatives.

In	addition,	BlackRock	has	begun	reporting	certain	information	about	a	number	of	its private	funds	to	the	SEC	and	certain	information	about	a	number	of	its	commodity	pools to	the	CFTC,	pursuant	to	systemic	risk	reporting	requirements	adopted	by	both agencies,	which	have	required,	and	will	continue	to	require,	investments	in	people	and systems	to	assure	timely	and	accurate	reporting.

The	SEC,	the	Internal	Revenue	Service	and	the	CFTC	each	continue	to	review	the	use of	futures	and	derivatives	by	mutual	funds,	which	could	result	in	regulations	that	further limit	the	use	of	such	instruments	by	mutual	funds.	If	adopted,	these	limitations	could require	BlackRock	to	change	certain	mutual	fund	business	practices	or	to	register additional	entities	with	the	CFTC,	which	could	result	in	additional	costs	and/or restrictions.

The	SEC	has	recently	promulgated	new	rules	that	give	effect	to	a	section	of	the	DFA that	requires	municipal	advisors	(as	that	term	is	defined	in	the	statute)	to	register	with the	SEC.	The	new	rules	require	entities	that	provide	certain	types	of	advice	to,	or	on behalf	of,	or	solicit	municipal	entities	or	certain	other	persons,	to	register	with	the	SEC and	the	Municipal	Securities	Rulemaking	Board	("MSRB")	as	municipal	advisors, thereby	subjecting	those	entities	to	new	or	additional	regulation	by	the	SEC	and	MSRB. BlackRock	is	reviewing	what	impact	the	new	rules	will	have	on	its	business,	financial condition	and	results	of	operation.

The	foregoing	regulatory	changes,	and	other	reforms	globally,	could	also	lead	to business	disruptions,	could	adversely	impact	the	value	of	assets	in	which	BlackRock has	invested	on	behalf	of	clients	and/or	via	seed	or	co-investments,	and,	to	the	extent the	regulations	strictly	control	the	activities	of	financial	services	firms,	could	make	it more	difficult	for	BlackRock	to	conduct	certain	business	activities	or	distinguish	itself from	competitors.	See	"Item	1

–	Business"	above	for	additional	information	regarding	certain	laws	and	regulations	that affect	BlackRock's	business.

# BlackRock	may	be	adversely	impacted	by	legal	and	regulatory	changes	related	to money	market	mutual	funds.

Regulatory	authorities,	including	the	SEC,	the	FSOC	and	the	International	Organization of	Securities	Commissions,	continue	to	focus	on	the	need	for	additional	regulations	for money	market	mutual	funds.	In	June	2013,	the	SEC	issued	for	public	comment	a proposal	to	reform	the	regulatory	structure	governing	money	market	funds	and	address the	perceived	systemic	risks	that	money	market	funds	present.	The	SEC's	proposal also	proposes	many	other	changes	to	disclosure	and	portfolio	construction requirements	for	money	market	funds.	If	adopted	by	the	SEC,	these	reform	proposals could	significantly	affect	money	market	fund	products	and	the	entire	money	market	fund industry.	In	light	of	the	uncertainty	regarding	what	changes	may	ultimately	be	adopted in	a	final	SEC	rule,	the	Company	cannot	predict	what	investor	appetite	will	be	for	money market	mutual	fund	products	following	the	adoption	of	any	such	reforms	or	the	impact	of such	reforms	on	BlackRock.

# Failure	to	comply	with	the	Investment	Advisers	Act	of	1940	(the	"Advisers	Act") or	the	Investment	Company	Act	of	1940	(the	"Investment	Company	Act")	and related	regulations	could	result	in	substantial	harm	to	BlackRock's	reputation and	results	of	operations.

Certain	BlackRock	subsidiaries	are	registered	with	the	SEC	under	the	Advisers	Act	and BlackRock's	U.S.	mutual	funds,	closed-end	funds	and	exchange-traded	funds	are registered	with	the	SEC	under	the	Investment	Company	Act.	The	Advisers	Act	imposes numerous	obligations	and	fiduciary	duties	on	registered	investment	advisers,	including record-keeping,	operating	and	marketing	requirements,	disclosure	obligations	and prohibitions	on	self-dealing.	The	Investment	Company	Act	imposes	similar	obligations, as	well	as	additional	detailed	operational	and	compliance	requirements	on	investment advisers	to	registered	investment	companies.	The	failure	of	any	of	BlackRock's	relevant subsidiaries	to	comply	with	the	Advisers	Act	or	the	Investment	Company	Act	could cause	the	SEC	to	institute	proceedings	and	impose	sanctions	for	violations	of	either	of these	acts,	including	censure,	termination	of	an	investment	adviser's	registration	or prohibition	to	serve	as	adviser	to	SEC-registered	funds,	and	could	lead	to	litigation	by investors	in	those	funds	or	harm	to	the	Company's	reputation,	any	of	which	could	cause its	earnings	to	decline.

# Failure	to	comply	with	ERISA	regulations	could	result	in	penalties	and	cause	the Company's	earnings	to	decline.

Certain	BlackRock	subsidiaries	are	subject	to	the	Employee	Retirement	Income Security	Act	of	1974	("ERISA")	and	to	regulations	promulgated	thereunder,	insofar	as they	act	as	a	"fiduciary"	under	ERISA	with	respect	to	benefit	plan	clients.	ERISA	and applicable	provisions	of	the	Internal	Revenue	Code	impose	duties	on	persons	who	are fiduciaries	under	ERISA,	prohibit	specified	transactions	involving	ERISA	plan	clients and	provide	monetary	penalties	for	violations	of	these	prohibitions.	The	failure	of	any	of BlackRock's	relevant	subsidiaries	to	comply	with	these	requirements	could	result	in significant	penalties	that	could	reduce	the	Company's	earnings	to	decline.

# BlackRock	is	subject	to	banking	regulations	that	may	limit	its	business	activities.

As	described	in	"Item	1-Business",	PNC	owns	approximately	22%	of	BlackRock's capital	stock.	Based	on	the	Federal	Reserve's	current	interpretation	of	the	Bank	Holding Company	Act	of	1956	(the	"BHC	Act"),	this	ownership	interest	causes	BlackRock	to	be treated	as	a	non-bank	subsidiary	of	PNC	for	purposes	of	the	BHC	Act.	As	a	non-bank subsidiary	of	PNC,	BlackRock	is	subject	to	banking	regulation,	including	the	supervision and	regulation	of	the	Federal	Reserve.	Such	banking	regulation	limits	the	activities	and the	types	of	businesses	that	BlackRock	may	conduct.	The	Federal	Reserve	has	broad enforcement	authority	over	BlackRock,	including	the	power	to	prohibit	BlackRock	from conducting	any	activity	that,	in	the	Federal	Reserve's	opinion,	is	unauthorized	or constitutes	an	unsafe	or	unsound	practice,	and	to	impose	substantial	fines	and	other penalties	for	violations.	PNC	is	regulated	as	a	"financial	holding	company"	under	the BHC	Act,	which	allows	PNC	and	BlackRock	to	engage	in	a	much	broader	set	of activities	than	would	otherwise	be	permitted	under	the	BHC	Act;	any	failure	of	PNC	to maintain	its	status	as	a	financial	holding	company	could	result	in	substantial	limitations on	certain	BlackRock	activities	and	its	growth.	Furthermore,	the	Volcker	Rule,	which	is a	part	of	the	BHC	Act,	will	affect	the	method	by	which	BlackRock	invests	in	and operates	its	private	investment	funds,	including	private	equity	funds,	hedge	funds	and funds	of	funds.	BlackRock's	trust	bank	subsidiary	is	also	subject	to	regulation	by	the OCC,	and	is	subject	to	capital	requirements	established	by	the	OCC.	The	OCC	has broad	enforcement	authority	over	BlackRock's	trust	bank	subsidiary.	Being	subject	to banking	regulation,	including	the	Volcker	Rule,	may	put	BlackRock	at	a	competitive disadvantage	because	most	of	its	competitors	are	not	subject	to	these	limitations.

# Failure	to	comply	with	laws	and	regulations	in	the	European	Union	in	which BlackRock	operates	could	result	in	substantial	harm	to	BlackRock's	reputation and	results	of	operations.

In	the	aftermath	of	the	financial	crisis,	the	European	Commission	set	out	a	detailed	plan for	EU	financial	reform,	outlining	a	number	of	initiatives	to	be	reflected	in	new	or updated	directives,	regulations	and	recommendations	of	which	the	review	of	the Markets	in	Financial	Instruments	Directive	("MiFID")	was	a	part.	These,	together	with the	changes	introduced	by	the	Alternative	Investment	Fund	Managers	Directive ("AIFMD"),	will	have	direct	and	indirect	effects	on	BlackRock's	operations	in	the European	Economic	Area,	including	increased	compliance,	disclosure	and	other obligations,	which	could	adversely	impact	BlackRock's	ability	to	expand	in	these markets.

The	Financial	Conduct	Authority	(the	"FCA")	regulates	BlackRock's	subsidiaries	in	the United	Kingdom	and	branches	in	the	European	Union	and	the	Prudential	Regulation Authority	the	("PRA")	also	regulates	one	BlackRock	subsidiary	in	the	United	Kingdom. Authorization	by	the	FCA	and/or	the	PRA	is	required	to	conduct	any	financial	services related	business	in	the	United	Kingdom	under	the	Financial	Services	and	Markets	Act 2000.	BlackRock's	U.K.	subsidiaries	require	authorization	by	the	FCA	under	the Financial	Services	and	Markets	Act	2000	in	order	to	conduct	their	financial	services- related	business	in	the	United	Kingdom.	The	FCA's	rules	govern	the	Company's	U.K.- regulated	subsidiaries'	capital	resources	requirements,

senior	management	arrangements,	conduct	of	business,	interaction	with	clients	and systems	and	controls,	while	the	rules	of	the	PRA	focus	solely	on	the	prudential requirements	imposed	on	firms.	Breaches	of	these	rules	may	result	in	a	wide	range	of disciplinary	actions	against	the	Company's	U.K.-regulated	subsidiaries	or	employees.

In	addition,	these	subsidiaries,	and	other	European	subsidiaries,	branches	or representative	offices,	must	comply	with	the	pan-European	regime	established	by MiFID,	which	regulates	the	provision	of	investment	services	and	activities	throughout the	EEA,	as	well	as	the	Capital	Requirements	Directive,	which	delineates	regulatory capital	requirements.	As	discussed	under	"Item	1	-	Business	-	Regulation,"	in	the aftermath	of	the	financial	crisis	the	European	Commission	adopted	a	detailed	plan	to complete	the	EU's	financial	reform,	outlining	a	number	of	initiatives	to	be	reflected	in new	or	updated	directives,	regulations	and	recommendations.	The	AIFMD	has	been implemented	in	some	EU	countries,	including	the	United	Kingdom,	Ireland,	France, Germany,	the	Netherlands	and	Luxembourg,	but	several	other	EU	member	states	are still	in	various	stages	of	the	adoption	process.	Compliance	with	the	AIFMD's requirements	is	likely	to	restrict	marketing	by	funds	subject	to	the	AIFMD	and	place additional	compliance	and	disclosure	obligations	regarding	remuneration,	capital requirements,	leverage,	valuation,	stakes	in	EU	companies,	depositaries,	the	domicile of	custodians	and	liquidity	management.	In	addition,	UCITS	IV	was	adopted	into national	law	of	each	EU	member	state	(except	Portugal).

There	are	also	European	Commission	consultations	in	process	that	are	intended	to improve	retail	investor	protection	including:	(i)	UCITS	V,	which	addresses,	among	other items,	custodial	liability	and	remuneration	of	UCITS	managers,	which	are	intended	to	be consistent	with	the	equivalent	provisions	of	the	AIFMD;	(ii)	UCITS	VI,	which	will address,	among	other	items,	the	eligible	assets	which	a	UCITS	fund	can	invest	in, efficient	portfolio	management	techniques	and	extraordinary	liquidity	management tools;	and	(iii)	Regulation	on	Money	Market	Funds	("MMFs"),	which	will	introduce	new regulatory	measures	that	will	apply	to	European	MMFs.	The	European	Commission's proposals	on	packaged	retail	investment	products	("PRIPs")	are	to	be	implemented through	the	strengthening	of	MiFID	standards	(for	non-insurance	PRIPs),	revisions	to the	Insurance	Mediation	Directive's	selling	standard	(for	all	insurance-based	PRIPs) and	new	investor	disclosure	requirements	for	all	PRIPs	through	a	separate	EU legislative	process,	which	is	expected	to	be	adopted	in	2014	and	come	into	effect	in 2016.	In	the	United	Kingdom,	the	Bribery	Act	2010	came	into	force	in	July	2011	and	has required	the	implementation	of	additional	procedures	on	the	Company's	U.K.-regulated subsidiaries.

In	addition,	rules	introduced	in	the	United	Kingdom	following	a	retail	distribution	review initiated	by	the	FCA's	predecessor,	the	Financial	Services	Authority,	changed	how investment	advice	is	paid	for	in	the	United	Kingdom	for	all	retail	investment	products. Regulation	(EU)	no	648/2012	of	the	European	Parliament	and	of	the	Council	of	July	4, 2012	on	OTC	derivatives,	central	counterparties	and	trade	repositories	("EMIR"),	was adopted	in	August	2012,	and	requires	(i)	the	central	clearing	of	standardized	OTC derivatives,	(ii)	the	application	of	risk-mitigation	techniques	to	non-centrally	cleared OTC	derivatives	and	(iii)	the	reporting	of	all	derivative	contracts	from	February	2014. Finally,	the	CRD	IV	package	of	reforms	on	prudential	requirements	for	credit	institutions and

investment	firms,	which	became	effective	on	January	1,	2014,	will	have	direct	and indirect	impacts	on	the	Company's	EU-regulated	subsidiaries.

# Failure	to	comply	with	laws	and	regulations	in	the	Asia-Pacific	region	and	other non-U.S.	jurisdictions	in	which	BlackRock	operates	could	result	in	substantial harm	to	BlackRock's	reputation	and	results	of	operations.

In	Japan,	a	BlackRock	subsidiary	is	subject	to	the	Financial	Instruments	and	Exchange Law	(the	"FIEL")	and	the	Law	Concerning	Investment	Trusts	and	Investment Corporations.	These	laws	are	administered	and	enforced	by	the	Japanese	Financial Services	Agency	(the	"JFSA"),	which	establishes	standards	for	compliance,	including capital	adequacy	and	financial	soundness	requirements,	customer	protection requirements	and	conduct	of	business	rules.	The	JFSA	is	empowered	to	conduct administrative	proceedings	that	can	result	in	censure,	fines,	the	issuance	of	cease	and desist	orders	or	the	suspension	or	revocation	of	registrations	and	licenses	granted under	the	FIEL.	In	addition,	the	BlackRock	subsidiary	has	recently	obtained	a	license for	real	estate	broker	business	from	the	Tokyo	governor	and,	therefore,	must	comply with	various	regulations	set	forth	in	the	Real	Estate	Brokerage	Business	Act.

In	Australia,	BlackRock's	subsidiaries	are	subject	to	various	Australian	federal	and	state laws	and	certain	subsidiaries	are	regulated	by	the	Australian	Securities	and Investments	Commission	("ASIC").	ASIC	regulates	companies	and	financial	services	in Australia	and	is	responsible	for	promoting	investor,	creditor	and	consumer	protection. Failure	to	comply	with	applicable	law	and	regulations	could	result	in	the	cancellation, suspension	or	variation	of	the	relevant	subsidiaries'	licenses	in	Australia.

The	activities	of	certain	BlackRock	subsidiaries	in	Hong	Kong	are	subject	to	the Securities	and	Futures	Ordinance	(the	"SFO"),	which	governs	the	securities	and	futures markets	and	regulates,	among	others,	offers	of	investments	to	the	public	and	provides for	the	licensing	of	intermediaries.	The	SFO	is	administered	by	the	Securities	and Futures	Commission	(the	"SFC").	The	SFC	is	also	empowered	under	the	SFO	to establish	standards	for	compliance	as	well	as	codes	and	guidelines.	The	relevant BlackRock	subsidiaries	and	the	employees	conducting	any	of	the	regulated	activities specified	in	the	SFO	are	required	to	be	licensed	with	the	SFC,	and	are	subject	to	the rules,	codes	and	guidelines	issued	by	the	SFC	from	time	to	time.	Failure	to	comply	with the	SFO	and	other	applicable	laws,	regulations,	codes	and	guidelines	issued	by	the SFC	could	result	in	penalties,	sanctions	and	the	suspension	or	revocations	of	the licenses	granted	by	the	SFC.

There	are	similar	legal	and	regulatory	arrangements	in	force	in	many	other	non-U.S. jurisdictions	where	BlackRock's	subsidiaries	conduct	business	or	where	the	funds	and products	it	manages	are	organized.	Failure	to	comply	with	laws	and	regulations	in	any of	these	jurisdictions	could	result	in	substantial	harm	to	BlackRock's	reputation	and results	of	operation	and	result	in	fines	or	sanctions	for	BlackRock	or	its	employees.

# Failure	to	comply	with	ownership	reporting	requirements	could	result	in	harm	to BlackRock's	reputation	and	results	of	operations.

Of	note	among	the	various	international	regulations	to	which	BlackRock	is	subject,	are the	extensive	and	increasingly

stringent	regulatory	reporting	requirements	that	necessitate	the	monitoring	and	reporting of	issuer	exposure	levels	(thresholds)	across	the	holdings	of	managed	funds	and accounts	and	those	of	the	Company.	The	specific	triggers	and	the	reporting	methods that	these	threshold	filings	entail	vary	significantly	by	regulator	and	across jurisdictions.	BlackRock	continues	to	invest	in	technology,	training	and	personnel	to enhance	its	monitoring	and	reporting	functions	and	improve	the	timeliness	and	accuracy of	its	disclosures.	Despite	these	investments,	the	complexity	of	the	various	threshold reporting	requirements	combined	with	the	breadth	of	the	assets	managed	by	the Company	and	high	volume	of	securities	trading	pose	a	risk	that	errors	or	omissions	will occasionally	occur,	which	could	have	an	adverse	effect	on	BlackRock's	reputation	and results	of	operation.

# Changes	in	U.S.	and	non-U.S.	tax	laws	and	regulations	or	challenges	to BlackRock's	tax	positions	with	respect	to	historical	transactions	may	adversely affect	BlackRock's	effective	tax	rate,	business	and	overall	financial	condition.

BlackRock's	businesses	may	be	directly	or	indirectly	affected	by	new	tax	legislation	and regulation,	or	the	modification	of	existing	tax	laws	and	regulations	by	U.S.	or	non-U.S. authorities.	The	Company	manages	significant	assets	in	products	and	accounts	that have	specific	tax	and	after-tax	related	objectives,	which	could	be	adversely	impacted by	changes	in	tax	policy,	particularly	with	respect	to	U.S.	municipal	income,	the	U.S. individual	income	tax	rate	on	qualified	dividends	and,	globally,	alternative	products.

Additionally,	any	new	legislation,	modification	or	interpretation	of	tax	laws	could	also impact	BlackRock's	corporate	tax	position.	The	application	of	complex	tax	regulations involves	numerous	uncertainties	and	in	the	normal	course	of	business	U.S.	and	non- U.S.	tax	authorities	may	review	and	challenge	tax	positions	adopted	by	BlackRock. These	challenges	may	result	in	adjustments	to,	or	impact	the	timing	or	amount	of, taxable	income,	deductions	or	other	tax	allocations,	which	may	adversely	affect BlackRock's	effective	tax	rate	and	overall	financial	condition.

# Legal	proceedings	could	adversely	affect	operating	results,	financial	condition and	cash	flows	for	a	particular	period.

Many	aspects	of	BlackRock's	business	involve	substantial	risks	of	legal	liability.	The Company,	certain	of	its	subsidiaries	and	employees	have	been	named	as	defendants	in various	legal	actions,	including	arbitrations,	class	actions	and	other	litigation	arising	in connection	with	BlackRock's	activities.	Certain	BlackRock	subsidiaries	are	subject	to periodic	examination,	special	inquiries	and	potential	proceedings'	by	regulatory authorities,	including	the	SEC,	OCC,	DOL,	CFTC	and	FCA.	These	examinations, inquiries	and	proceedings	could	if	compliance	failures	or	other	violations	are	found, cause	the	SEC	to	institute	proceedings	and	impose	sanctions	for	violations,	including censure,	termination	of	an	investment	adviser's	registration	or	prohibition	to	serve	as adviser	to	SEC-registered	funds,	and	could	lead	to	litigation	by	investors	in	those	funds or	harm	to	the	Company's	reputation,	any	of	which	could	cause	its	earnings	to	decline. From	time	to	time,	BlackRock	receives	subpoenas	or	other	requests	for	information from	various	U.S.	and	non-U.S.	governmental	and	regulatory	authorities	in	connection with	certain	industry-wide,	company-specific	or	other	investigations	or	proceedings. Additionally,	certain	of	the

investment	funds	that	the	Company	manages	are	subject	to	lawsuits,	any	of	which could	potentially	harm	the	investment	returns	of	the	applicable	fund	or	result	in	the Company	being	liable	to	the	funds	for	any	resulting	damages.

# Item	1B.	Unresolved	Staff Comments

The	Company	has	no	unresolved	comments	from	the	SEC	staff	relating	to	BlackRock's periodic	or	current	reports	filed	with	the	SEC	pursuant	to	the	Exchange	Act.

# Item	2.	Properties

BlackRock's	principal	office,	which	is	leased,	is	located	at	55	East	52nd	Street,	New York,	New	York.	BlackRock	leases	additional	office	space	in	New	York	City	at	40	East 52nd	Street	and	throughout	the	world,	including	Boston,	Chicago,	Edinburgh,	Gurgaon (India),	Hong	Kong,	London,	Melbourne,	Munich,	Princeton	(New	Jersey),	San Francisco,	Seattle,	Singapore,	Sydney,	Taipei	and	Tokyo.	The	Company	also	owns	an 84,500	square	foot	office	building	in	Wilmington	(Delaware).

# Item	3.	Legal	Proceedings

From	time	to	time,	BlackRock	receives	subpoenas	or	other	requests	for	information from	various	U.S.	federal,	state	governmental	and	domestic	and	international	regulatory authorities	in	connection	with	certain	industry-wide	or	other	investigations	or proceedings.	It	is	BlackRock's	policy	to	cooperate	fully	with	such	inquiries.	The Company	and	certain	of	its	subsidiaries	have	been	named	as	defendants	in	various legal	actions,	including	arbitrations	and	other	litigation	arising	in	connection	with BlackRock's	activities.	Additionally,	certain	BlackRock-sponsored	investment	funds	that the	Company	manages	are	subject	to	lawsuits,	any	of	which	potentially	could	harm	the investment	returns	of	the	applicable	fund	or	result	in	the	Company	being	liable	to	the funds	for	any	resulting	damages.

# Italian	Securities	Regulator	Proceeding

The	Italian	securities	regulator,	Commissione	Nazionale	per	le	Societa	e	la	Borsa ("Consob"),	initiated	a	civil	proceeding	on	January	3,	2014	against	Nigel	Bolton,	a portfolio	manager	and	head	of	BlackRock	Investment	Management	(UK)	Limited's European	Equity	Team	("EET"),	in	connection	with

the	sale	of	shares	in	the	Italian	oil	and	gas	services	company	Saipem,	SpA	in	January 2013.

Consob	alleges	that	Mr.	Bolton,	on	behalf	of	certain	BlackRock	clients,	sold,	or influenced	the	sale	of,	approximately	10.7	million	shares	of	Saipem	using	material,	non- public	information	thereby	avoiding	client	losses	of	over	€114.5	million.	The	EET's	sale of	Saipem	shares	occurred	between	January	25	and	January	29,	2013,	and	Saipem announced	negative	news	following	the	market	close	on	January	29,	2013.	While BlackRock	is	not	charged	in	the	proceeding,	it	may	be	liable	for	the	actions	of	its employee.

BlackRock	conducted	a	thorough	investigation	and	found	no	evidence	to	support	the allegations.	As	a	result	of	the	investigation,	BlackRock	believes	that	the	sale	of	Saipem shares	was	made	as	a	fiduciary	based	on	publicly	available	information	that	was	widely disseminated	in	the	marketplace,	including	negative	publicity	and	a	third-party	analyst research	report	reducing	earnings	estimates,	which	was	issued	to	the	market	before trading	on	January	25,	2013.

Consob	also	alleges	that	BlackRock	declined	to	provide	Consob	with	information	and was	an	obstacle	to	Consob's	investigation.	BlackRock	believes	it	has	fully	cooperated with	Consob,	and	it	will	continue	to	do	so.

While	under	Italian	law	the	potential	penalty	could	be	greater	than	the	loss	actually avoided,	BlackRock	believes	that	Mr.	Bolton	will	not	be	found	liable	and,	as	a	result, neither	Mr.	Bolton	nor	BlackRock	will	incur	any	penalty.

# All	Legal	Proceedings

Management,	after	consultation	with	legal	counsel,	currently	does	not	anticipate	that	the aggregate	liability,	if	any,	arising	out	of	regulatory	matters	or	lawsuits	will	have	a material	effect	on	BlackRock's	results	of	operations,	financial	position,	or	cash	flows. However,	there	is	no	assurance	as	to	whether	any	such	pending	or	threatened	matters will	have	a	material	effect	on	BlackRock's	results	of	operations,	financial	position	or cash	flows	in	any	future	reporting	period.	Due	to	uncertainties	surrounding	the	outcome of	these	matters,	management	cannot	reasonably	estimate	the	possible	loss	or	range of	loss	that	may	arise	from	these	matters.

# Item	4.	Mine	Safety	Disclosures

Not	applicable.

# PART	II

# Item	5.	Market	for	Registrant's

# Common	Equity,	Related	Stockholder	Matters	and Issuer	Purchases	of	Equity	Securities

BlackRock's	common	stock	is	listed	on	the	NYSE	and	is	traded	under	the	symbol "BLK".	At	the	close	of	business	on	January	31,	2014,	there	were	320	common stockholders	of	record.	Common	stockholders	include	institutional	or	omnibus	accounts that	hold	common	stock	for	multiple	underlying	investors.

The	following	table	sets	forth	for	the	periods	indicated	the	high	and	low	reported	sale prices,	period-end	closing	prices	for	the	common	stock	and	dividends	declared	per share	for	the	common	stock	as	reported	on	the	NYSE:

| 2013 | Common	Stock<br>Price	Ranges<br>High | Low | Closing<br>Price | Cash<br>Dividend<br>Declared |
| :--- | :--- | :--- | :--- | :--- |
| First\tQuarter | $\t258.70 | $\t212.77 | $\t256.88 | $\t1.68 |
| Second\tQuarter | $ 291.69 | $ 245.30 | $ 256.85 | $1.68 |
| Third\tQuarter | $ 286.62 | $ 255.26 | $ 270.62 | $1.68 |
| Fourth\tQuarter | $ 316.47 | $ 262.75 | $ 316.47 | $1.68 |
| 2012 |  |  |  |  |
| First\tQuarter | $ 205.60 | $ 179.13 | $ 204.90 | $1.50 |
| Second\tQuarter | $ 206.57 | $ 163.37 | $ 169.82 | $1.50 |
| Third\tQuarter | $ 183.00 | $ 164.06 | $ 178.30 | $1.50 |
| Fourth\tQuarter | $ 209.29 | $ 177.17 | $ 206.71 | $1.50 |

# DIVIDENDS

On	January	15,	2014,	the	Board	of	Directors	approved	BlackRock's	quarterly	dividend of	$1.93	to	be	paid	on	March	24,	2014	to	stockholders	of	record	on	March	7,	2014.

PNC	and	their	respective	affiliates	that	hold	nonvoting	participating	preferred	stock receive	dividends	on	these	shares,	which	are	equivalent	to	the	dividends	received	by common	stockholders.

# ISSUER	PURCHASES	OF	EQUITY	SECURITIES

During	the	three	months	ended	December	31,	2013,	the	Company	made	the	following	purchases	of	its	common	stock,	which	is	registered	pursuant	to	Section	12(b)	of	the	Exchange Act.

| Total<br>Number	of<br>Shares<br>Purchased | Average<br>Price	Paid<br>per	Share | Total	Number	of<br>Shares	Purchased<br>as	Part	of	Publicly<br>Announced	Plans<br>or	Programs | May	Yet	Be<br>Purchased<br>Under	the<br>Plans	or<br>Programs(1) |
| :--- | :--- | :--- | :--- |
| 277,354(2) | $303.58 | 267,000 | 7,093,355 |
| 514,075(2) | $302.38 | 513,000 | 6,580,355 |
| 65,905(2) | $305.46 | 44,800 | 6,535,555 |
| 857,334 | $\t303.01 | 824,800 |  |

(1) In	January	2013,	the	Board	of	Directors	approved	an	increase	in	the	availability	under	the	Company's	existing	share	repurchase	program	to	allow	for	the	repurchase	of	up	to	10.2	million	shares	of	BlackRock	common stock	with	no	stated	expiration	date.

(2) Includes	purchases	made	by	the	Company	primarily	to	satisfy	income	tax	withholding	obligations	of	employees	and	members	of	the	Company's	Board	of	Directors	related	to	the	vesting	of	certain	restricted	stock	or restricted	stock	unit	awards	and	purchases	made	by	the	Company	as	part	of	the	publicly	announced	share	repurchase	program.

# Item	6.	Selected	Financial	Data

The	selected	financial	data	presented	below	has	been	derived	in	part	from,	and	should	be	read	in	conjunction	with,	the	consolidated	financial	statements	of	BlackRock	and	Item	7.

Management's	Discussion	and	Analysis	of	Financial	Condition	and	Results	of	Operations	included	in	this	Form	10-K.

|  |  | Year	ended	December	31, | Year	ended	December	31, |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- |
| (in\tmillions,\texcept\tper\tshare\tdata) | 2013 | 2012 | 2011 | 2010(1) | 2009 |
| Income\tstatement\tdata: |  |  |  |  |  |
| Revenue |  |  |  |  |  |
| Related\tparties(2) | $6,260 | $5,501 | $5,431 | $5,025 | $2,716 |
| Other\tthird\tparties | 3,920 | 3,836 | 3,650 | 3,587 | 1,984 |
| Total\trevenue | 10,180 | 9,337 | 9,081 | 8,612 | 4,700 |
| Expenses |  |  |  |  |  |
| Restructuring\tcharges | — | — | 32 | — | 22 |
| Other\toperating\texpenses | 6,323 | 5,813 | 5,800 | 5,614 | 3,400 |
| Total\texpenses | 6,323 | 5,813 | 5,832 | 5,614 | 3,422 |
| Operating\tincome | 3,857 | 3,524 | 3,249 | 2,998 | 1,278 |
| Total\tnonoperating\tincome\t(expense) | 116 | (54) | (114) | 23 | (6) |
| Income\tbefore\tincome\ttaxes | 3,973 | 3,470 | 3,135 | 3,021 | 1,272 |
| Income\ttax\texpense | 1,022 | 1,030 | 796 | 971 | 375 |
| Net\tincome | 2,951 | 2,440 | 2,339 | 2,050 | 897 |
| Less:\tNet\tincome\t(loss)\tattributable\tto\tnoncontrolling\tinterests | 19 | (18) | 2 | (13) | 22 |
| Net\tincome\tattributable\tto\tBlackRock,\tInc. | $2,932 | $2,458 | $2,337 | $2,063 | $875 |
| Per\tshare\tdata:(3) |  |  |  |  |  |
| Basic\tearnings | $17.23 | $14.03 | $12.56 | $10.67 | $6.24 |
| Diluted\tearnings | $16.87 | $13.79 | $12.37 | $10.55 | $6.11 |
| Book\tvalue(4) | $\t156.69 | $\t148.20 | $\t140.07 | $\t136.09 | $\t128.86 |
| Common\tand\tpreferred\tcash\tdividends | $6.72 | $6.00 | $5.50 | $4.00 | $3.12 |

| (in	millions) | 2013 | 2012 | 2011 | 2010 | 2009 |
| :--- | :--- | :--- | :--- | :--- | :--- |
| Balance\tsheet\tdata: |  |  |  |  |  |
| Cash\tand\tcash\tequivalents | $4,390 | $4,606 | $3,506 | $3,367 | $4,708 |
| Goodwill\tand\tintangible\tassets,\tnet | 30,481 | 30,312 | 30,148 | 30,317 | 30,346 |
| Total\tassets(5) | 219,873 | 200,451 | 179,896 | 178,459 | 178,124 |
| Less: |  |  |  |  |  |
| Separate\taccount\tassets(6) | 155,113 | 134,768 | 118,871 | 121,137 | 119,629 |
| Collateral\theld\tunder\tsecurities\tlending\tagreements(6) | 21,788 | 23,021 | 20,918 | 17,638 | 19,335 |
| Consolidated\tinvestment\tvehicles(7) | 2,714 | 2,813 | 2,006 | 1,610 | 282 |
| Adjusted\ttotal\tassets | $40,258 | $39,849 | $38,101 | $38,074 | $38,878 |
| Short-term\tborrowings | $— | $100 | $100 | $100 | $2,234 |
| Convertible\tdebentures | — | — | — | 67 | 243 |
| Long-term\tborrowings | 4,939 | 5,687 | 4,690 | 3,192 | 3,191 |
| Total\tborrowings | $4,939 | $5,787 | $4,790 | $3,359 | $5,668 |
| Total\tBlackRock,\tInc.\tstockholders'\tequity | $26,460 | $25,403 | $25,048 | $26,094 | $24,329 |
| Assets\tunder\tmanagement: |  |  |  |  |  |
| Equity: |  |  |  |  |  |
| Active | $317,262 | $287,215 | $275,156 | $334,532 | $348,574 |
| iShares | 718,135 | 534,648 | 419,651 | 448,160 | 381,399 |
| Fixed\tincome: |  |  |  |  |  |
| Active | 652,209 | 656,331 | 614,804 | 592,303 | 595,580 |
| iShares | 178,835 | 192,852 | 153,802 | 123,091 | 102,490 |
| Multi-asset | 341,214 | 267,748 | 225,170 | 185,587 | 142,029 |
| Alternatives: |  |  |  |  |  |
| Core | 85,026 | 68,367 | 63,647 | 63,603 | 66,058 |
| Currency\tand\tcommodities(8) | 26,088 | 41,428 | 41,301 | 46,135 | 36,043 |
| Subtotal | 2,318,769 | 2,048,589 | 1,793,531 | 1,793,411 | 1,672,173 |
| Non-ETF\tIndex: |  |  |  |  |  |
| Equity | 1,282,298 | 1,023,638 | 865,299 | 911,775 | 806,082 |
| Fixed\tincome | 411,142 | 410,139 | 479,116 | 425,930 | 357,557 |
| Subtotal\tNon-ETF\tIndex | 1,693,440 | 1,433,777 | 1,344,415 | 1,337,705 | 1,163,639 |
| Long-term | 4,012,209 | 3,482,366 | 3,137,946 | 3,131,116 | 2,835,812 |
| Cash\tmanagement | 275,554 | 263,743 | 254,665 | 279,175 | 349,277 |
| Advisory(9) | 36,325 | 45,479 | 120,070 | 150,677 | 161,167 |
| Total | $\t4,324,088 | $\t3,791,588 | $\t3,512,681 | $\t3,560,968 | $\t3,346,256 |

(1) Significant	increases	in	2010	(for	income	statement	data)	were	primarily	the	result	of	the	BGI	Transaction	that	closed	on	December	1,	2009.

(2) BlackRock's	related	party	revenue	includes	fees	for	services	provided	to	registered	investment	companies	that	it	manages,	which	include	mutual	funds	and	exchange-traded	funds,	as	a	result	of	the	Company's advisory	relationship.	In	addition,	equity	method	investments	are	considered	related	parties	due	to	the	Company's	influence	over	the	financial	and	operating	policies	of	the	investee.	See	Note	16	to	the	consolidated financial	statements	for	more	information	on	related	parties.

(3) Participating	preferred	stock	is	considered	to	be	a	common	stock	equivalent	for	purposes	of	earnings	per	share	calculations.

(4) Total	BlackRock	stockholders'	equity,	excluding	appropriated	retained	earnings,	divided	by	total	common	and	preferred	shares	outstanding	at	December	31	of	the	respective	year-end.

(5) Includes	separate	account	assets	that	are	segregated	funds	held	for	purposes	of	funding	individual	and	group	pension	contracts	and	collateral	held	under	securities	lending	agreements	related	to	these	assets	that	have equal	and	offsetting	amounts	recorded	in	liabilities	and	ultimately	do	not	impact	BlackRock's	stockholders'	equity	or	cash	flows.

(6) Equal	and	offsetting	amounts,	related	to	separate	account	assets	and	collateral	held	under	securities	lending	agreements,	are	recorded	in	liabilities.

(7) Includes	assets	held	by	consolidated	variable	interest	entities	and	consolidated	sponsored	investments	funds.

(9) Advisory	AUM	represents	long-term	portfolio	liquidation	assignments.

# Item	7.	Management's	Discussion

# and	Analysis	of	Financial	Condition	and	Results	of Operations

# FORWARD-LOOKING	STATEMENTS

This	report,	and	other	statements	that	BlackRock	may	make,	may	contain	forward- looking	statements	within	the	meaning	of	the	Private	Securities	Litigation	Reform	Act, with	respect	to	BlackRock's	future	financial	or	business	performance,	strategies	or expectations.	Forward-looking	statements	are	typically	identified	by	words	or	phrases such	as	"trend,"	"potential,"	"opportunity,"	"pipeline,"	"believe,"	"comfortable,"	"expect," "anticipate,"	"current,"	"intention,"	"estimate,"	"position,"	"assume,"	"outlook,"	"continue," "remain,"	"maintain,"	"sustain,"	"seek,"	"achieve,"	and	similar	expressions,	or	future	or conditional	verbs	such	as	"will,"	"would,"	"should,"	"could,"	"may"	and	similar expressions.

BlackRock	cautions	that	forward-looking	statements	are	subject	to	numerous assumptions,	risks	and	uncertainties,	which	change	over	time.	Forward-looking statements	speak	only	as	of	the	date	they	are	made,	and	BlackRock	assumes	no	duty to	and	does	not	undertake	to	update	forward-looking	statements.	Actual	results	could differ	materially	from	those	anticipated	in	forward-looking	statements	and	future	results could	differ	materially	from	historical	performance.

In	addition	to	risk	factors	previously	disclosed	in	BlackRock's	Securities	and	Exchange Commission	("SEC")	reports	and	those	identified	elsewhere,	in	this	report,	the	following factors,	among	others,	could	cause	actual	results	to	differ	materially	from	forward- looking	statements	or	historical	performance:	(1)	the	introduction,	withdrawal,	success and	timing	of	business	initiatives	and	strategies;	(2)	changes	and	volatility	in	political, economic	or	industry	conditions,	the	interest	rate	environment,	foreign	exchange	rates or	financial	and	capital	markets,	which	could	result	in	changes	in	demand	for	products or	services	or	in	the	value	of	assets	under	management	("AUM");	(3)	the	relative	and absolute	investment	performance	of	BlackRock's	investment	products;	(4)	the	impact	of increased	competition;	(5)	the	impact	of	future	acquisitions	or	divestitures;	(6)	the unfavorable	resolution	of	legal	proceedings;	(7)	the	extent	and	timing	of	any	share repurchases;	(8)	the	impact,	extent	and	timing	of	technological	changes	and	the adequacy	of	intellectual	property,	information	and	cyber	security	protection;	(9)	the impact	of	legislative	and	regulatory	actions	and	reforms,	including	the	Dodd-Frank	Wall Street	Reform	and	Consumer	Protection	Act,	and	regulatory,	supervisory	or enforcement	actions	of	government	agencies	relating	to	BlackRock	or	The	PNC Financial	Services	Group,	Inc.	("PNC");	(10)	terrorist	activities,	international	hostilities and	natural	disasters,	which	may	adversely	affect	the	general	economy,	domestic	and local	financial	and	capital	markets,	specific	industries	or	BlackRock;	(11)	the	ability	to attract	and	retain	highly	talented	professionals;	(12)	fluctuations	in	the	carrying	value	of BlackRock's	economic	investments;	(13)	the	impact	of	changes	to	tax	legislation, including	income,	payroll	and	transaction	taxes,	and	taxation	on	products	or transactions,	which	could	affect	the	value	proposition	to	clients	and,	generally,	the	tax position	of	the	Company;	(14)	BlackRock's	success	in	maintaining	the	distribution	of	its products;	(15)	the	impact	of	BlackRock	electing	to	provide	support	to	its	products	from time	to	time	and	any	potential	liabilities

related	to	securities	lending	or	other	indemnification	obligations;	and	(16)	the	impact	of problems	at	other	financial	institutions	or	the	failure	or	negative	performance	of products	at	other	financial	institutions.

BlackRock,	Inc.	("BlackRock"	or	the	"Company")	is	the	world's	largest	publicly	traded investment	management	firm.	BlackRock	has	portfolio	managers	located	around	the world,	including	the	United	States,	the	United	Kingdom,	the	Netherlands,	Japan,	Hong Kong,	Singapore,	Australia	and	Germany.	At	December	31,	2013,	the	Company managed	$4.324	trillion	of	AUM	on	behalf	of	institutional	and	individual	investors worldwide.	The	Company	provides	a	wide	array	of	products,	including	passively	and actively	managed	products	in	various	equity,	fixed	income,	multi-asset,	alternative investment	and	cash	management	products.	BlackRock	offers	clients	diversified	access to	global	markets	through	separate	accounts,	collective	investment	trusts,	open-end	and closed-end	mutual	funds,	exchange-traded	products,	hedge	funds	and	funds	of	funds. BlackRock	also	provides	global	advisory	services	for	private	investment	funds	and	retail products.	The	Company's	non-U.S.	investment	funds	are	based	in	a	number	of domiciles	and	cover	a	range	of	asset	classes,	including	equities,	fixed	income,	cash management	and	alternatives.	In	addition,	BlackRock	Solutions®	provides	market	risk management,	financial	markets	advisory	and	enterprise	investment	system	services	to a	broad	base	of	clients.	Financial	markets	advisory	services	include	valuation	services relating	to	illiquid	securities,	dispositions	and	workout	assignments	(including	long-term portfolio	liquidation	assignments),	risk	management	and	strategic	planning	and execution.

In	the	United	States,	retail	offerings	include	various	open-end	and	closed-end	funds, including	iShares®,	the	global	product	leader	in	exchange-traded	products	for institutional,	retail,	including	high	net	worth,	investors.	iShares	global	AUM	totaled $914.4	billion	at	December	31,	2013.	The	BlackRock	Global	Funds,	the	Company's primary	retail	fund	group	offered	outside	the	United	States,	are	authorized	for distribution	in	35	jurisdictions	worldwide.	Additional	fund	offerings	include	structured products,	real	estate	funds,	hedge	funds,	hedge	funds	of	funds,	private	equity	funds and	funds	of	funds,	and	managed	futures	funds.	These	products	are	sold	to	both	U.S. and	non-U.S.,	retail	and	institutional	investors	in	a	wide	variety	of	active	and	passive strategies	covering	equity,	fixed	income	and	alternative	assets.

BlackRock's	client	base	consists	of	financial	institutions	and	other	corporate	clients, pension	plans,	charities,	official	institutions,	such	as	central	banks,	sovereign	wealth funds,	supranational	authorities	and	other	government	entities	and	retail	investors around	the	world.	BlackRock	maintains	a	significant	sales	and	marketing	presence	both inside	and	outside	the	United	States	that	is	focused	on	establishing	and	maintaining retail	and	institutional	investment	management	relationships	by	marketing	its	services	to investors	directly	and	through	financial	professionals,	pension	consultants	and establishing	third-party	distribution	relationships,	including	the	distribution	of	BlackRock products	and	services	through	Merrill	Lynch	under	a	global	distribution	agreement, which	was	automatically	renewed	for	a	three-year	extension	after	the	initial	term	ending on	January	1,	2014.

At	December	31,	2013,	PNC	held	20.9%	of	the	Company's	voting	common	stock	and 21.9%	of	the	Company's	capital	stock,	which	includes	outstanding	common	and nonvoting	preferred	stock.

# EXECUTIVE	SUMMARY

| (in	millions,	except	per	share	data) | 2013 | 2012 | 2011 |
| :--- | :--- | :--- | :--- |
| GAAP\tbasis: |  |  |  |
| Total\trevenue | $10,180 | $9,337 | $9,081 |
| Total\texpenses | 6,323 | 5,813 | 5,832 |
| Operating\tincome | $3,857 | $3,524 | $3,249 |
| Operating\tmargin | 37.9% | 37.7% | 35.8% |
| Nonoperating\tincome\t(expense),\tless\tnet\tincome\t(loss)\tattributable\tto\tnoncontrolling\tinterests(1) | 97 | (36) | (116) |
| Income\ttax\texpense | (1,022) | (1,030) | (796) |
| Net\tincome\tattributable\tto\tBlackRock | $2,932 | $2,458 | $2,337 |
| %\tattributable\tto\tcommon\tshares | 100.0% | 99.9% | 99.1% |
| Net\tincome\tattributable\tto\tcommon\tshares | $2,932 | $2,455 | $2,315 |
| Diluted\tearnings\tper\tcommon\tshare | $16.87 | $13.79 | $12.37 |
| Effective\ttax\trate | 25.8% | 29.5% | 25.4% |
| As\tadjusted(2): |  |  |  |
| Total\trevenue | $10,180 | $9,337 | $9,081 |
| Total\texpenses | 6,156 | 5,763 | 5,689 |
| Operating\tincome | $4,024 | $3,574 | $3,392 |
| Operating\tmargin | 41.4% | 40.4% | 39.7% |
| Nonoperating\tincome\t(expense),\tless\tnet\tincome\t(loss)\tattributable\tto\tnoncontrolling\tinterests(1) | 7 | (42) | (113) |
| Income\ttax\texpense | (1,149) | (1,094) | (1,040) |
| Net\tincome\tattributable\tto\tBlackRock | $2,882 | $2,438 | $2,239 |
| %\tattributable\tto\tcommon\tshares | 100.0% | 99.9% | 99.1% |
| Net\tincome\tattributable\tto\tcommon\tshares | $2,882 | $2,435 | $2,218 |
| Diluted\tearnings\tper\tcommon\tshare | $16.58 | $13.68 | $11.85 |
| Effective\ttax\trate | 28.5% | 31.0% | 31.7% |
| Other: |  |  |  |
| Assets\tunder\tmanagement\t(end\tof\tperiod) | $4,324,088 | $3,791,588 | $3,512,681 |
| Diluted\tweighted-average\tcommon\tshares\toutstanding(3) | \t173,828,902 | \t178,017,679 | \t187,116,410 |
| Shares\toutstanding\t(end\tof\tperiod) | 168,724,763 | 171,215,729 | 178,309,109 |
| Book\tvalue\tper\tshare(4) | $156.69 | $148.20 | $140.07 |
| Cash\tdividends\tdeclared\tand\tpaid\tper\tshare | $6.72 | $6.00 | $5.50 |

(2) As	adjusted	items	are	described	in	more	detail	in	 Non-GAAP	Financial	Measures.

(3) Nonvoting	participating	preferred	stock	is	considered	to	be	a	common	stock	equivalent	for	purposes	of	determining	basic	and	diluted	earnings	per	share	calculations.	In	addition,	unvested	restricted	stock	units	("RSUs") that	contain	nonforfeitable	rights	to	dividends	are	not	included	for	2012	and	2011	as	they	were	deemed	to	be	participating	securities	in	accordance	with	accounting	principles	generally	accepted	in	the	United	States ("GAAP").	Upon	vesting	of	the	participating	RSUs,	the	shares	were	added	to	the	weighted-average	shares	outstanding	that	resulted	in	an	increase	to	the	percentage	of	net	income	attributable	to	common	shares.	The Company's	remaining	participating	securities	vested	in	January	2013.

GAAP.	Operating	income	of	$3,857	million	increased	$333	million	from	2012.	In	the second	quarter	of	2013,	as	a	result	of	an	initial	public	offering	of	PennyMac	Financial Services,	Inc.	(the	"PennyMac	IPO"),	the	Company	recorded	a	noncash,	nonoperating pre-tax	gain	of	$39	million	related	to	the	carrying	value	of	its	equity	method	investment. Subsequent	to	the	PennyMac	IPO,	the	Company	made	a

charitable	contribution	of	6.1	million	units	of	its	equity	method	investment	with	a	fair value	of	$124	million	to	a	new	donor	advised	fund	(the	"Charitable	Contribution").	In connection	with	the	Charitable	Contribution,	the	Company	also	recorded	a	noncash, nonoperating	pre-tax	gain	of	$80	million	related	to	the	contributed	investment.	For further	information,	see	Note	11,	Other	Assets,	to	the	consolidated	financial	statements.

Operating	income	reflects	growth	in	base	fees	and	strong	performance	fees	and	higher BlackRock	Solutions	and	advisory	revenue,	partially	offset	by	higher	expenses, primarily	due	to	the	$124	million	expense	related	to	the	Charitable	Contribution	and higher	revenue-related	expenses.	The	results	for	2013	also	included	$43	million	of organizational	alignment	costs,	reflecting	compensation	and	severance	costs associated	with	the	alignment	of	staffing	with	the	Company's	strategic	priorities	and growth	opportunities.	Operating	income	in	2012	included	a	$30	million	charge	related	to a	contribution	to	certain	of	the	Company's	bank-managed	short-term	investment	funds ("STIFs").	Nonoperating	income	(expense),	less	net	income	(loss)	attributable	to	NCI increased	$133	million	due	to	the	$39	million	pre-tax	gain	related	to	the	PennyMac	IPO and	the	$80	million	gain	related	to	the	Charitable	Contribution	and	higher	net	positive marks	on	investments	during	2013	compared	with	2012.	Income	tax	expense	included a	$69	million	net	noncash	benefit	for	2013	and	a	$30	million	net	noncash	benefit	for 2012.	The	net	noncash	benefits	for	both	periods	primarily	related	to	the	revaluation	of certain	deferred	income	tax	liabilities,	including	the	effect	of	legislation	enacted	in	the United	Kingdom	and	domestic	state	and	local	income	tax	changes.	In	addition,	2013 income	tax	expense	included	an	approximately	$48	million	tax	benefit	recognized	in connection	with	the	Charitable	Contribution,	a	tax	benefit	of	approximately	$29	million, primarily	due	to	the	realization	of	tax	loss	carryforwards	and	benefits	from	certain nonrecurring	items.	Earnings	per	diluted	common	share	rose	$3.08,	or	22%,	compared with	2012	due	to	higher	net	income	and	the	benefit	of	share	repurchases.

As	Adjusted.	Operating	income	of	$4,024	million	and	operating	margin	of	41.4% increased	$450	million	and	100	basis	points,	respectively,	from	2012.	The	current	year results	included	the	previously	mentioned	organizational	alignment	costs	of	$43	million and	the	$39	million	pre-tax	gain	related	to	the	PennyMac	IPO.	Income	tax	expense	on an	as	adjusted	basis	included	a	tax	benefit	of	approximately	$29	million,	primarily	due to	the	realization	of	tax	loss	carryforwards,	and	benefits	from	certain	nonrecurring	items and	excluded	the	$69	million	net	noncash	benefit	in	2013	and	the	$30	million	net noncash	benefit	in	2012	described	above.	Earnings	per	diluted	common	share	rose $2.90,	or	21%,	from	2012.	The	financial	impact	related	to	the	Charitable	Contribution has	been	excluded	from	as	adjusted	results	for	2013.

GAAP.	Operating	income	of	$3,524	million	and	operating	margin	of	37.7%	increased $275	million	and	190	basis	points,	respectively,	from	2011	reflecting	growth	in	base fees	and	higher	performance	fees.	Operating	income	in	2012	included	a	$30	million charge	related	to	the	contribution	to	the	Company's	STIFs.	Nonoperating	income (expense),	less	net	income	(loss)	attributable	to	noncontrolling	interests,	increased	$80 million	due	to	higher	net	positive	marks	on	investments	in	2012	compared	with	2011, partially	offset	by	higher	interest	expense	resulting	from	long-term	debt	issuances	in May	2012	and	May	2011.	In	2012,	income	tax	expense	included	a	$21	million	benefit related	to	the	resolution	of	certain	outstanding	tax	positions	and	a	$50	million	net noncash	benefit	related	to	the	revaluation	of	certain	deferred	income	tax	liabilities, including	the	effect	of	tax	legislation	enacted	in	the	United	Kingdom	and	the	state

and	local	income	tax	effect	resulting	from	changes	in	the	Company's	organizational structure.	In	2011,	income	tax	expenses	included	a	$24	million	benefit	related	to	the resolution	of	certain	outstanding	tax	positions	and	$198	million	of	net	noncash	tax benefits	due	to	a	state	tax	election	and	enacted	U.K.,	Japan,	U.S.	state	and	local	tax legislation.	Earnings	per	diluted	common	share	rose	$1.42	from	2011	due	to	higher	net income	and	the	benefit	of	share	repurchases.	During	2012,	the	Company	repurchased 9.1	million	shares.

As	Adjusted.	Operating	income	of	$3,574	million	and	operating	margin	of	40.4% increased	$182	million	and	70	basis	points,	respectively,	from	2011	reflecting	higher revenues.	Operating	income	on	an	as	adjusted	basis	excluded	non-GAAP	expense adjustments	totaling	$50	million	in	2012	and	$143	million	in	2011.	Nonoperating	income (expense),	less	net	income	(loss)	attributable	to	noncontrolling	interests,	increased	$71 million.	Income	tax	expense	on	an	as	adjusted	basis	excluded	the	$50	million	and	$198 million	noncash	benefits	for	2012	and	2011,	respectively,	described	above.	Earnings per	diluted	common	share	rose	$1.83	from	2011	reflecting	the	improvement	in	net income	and	the	benefit	of	share	repurchases.

See	Non-GAAP	Financial	Measures	for	further	information	on	as	adjusted	items.

For	further	discussion	of	BlackRock's	revenue,	expenses,	nonoperating	results	and income	tax	expense,	see	Discussion	of	Financial	Results	herein.

# BUSINESS	OUTLOOK

BlackRock's	highly	diversified	multi-product	platform	was	created	to	meet	the	needs	of its	clients	in	all	market	environments.	BlackRock	is	positioned	to	provide	active	and passive	investment	solutions	across	asset	classes	and	geographies	and	leverage BlackRock	Solutions'	world-class	risk	management,	analytics	and	advisory	capabilities on	behalf	of	clients.

BlackRock's	key	client	themes	—	Income,	Alternatives,	Outcome	Investing,	Strategic Beta,	Emerging	Markets	and	Retirement	Solutions	—	are	expected	to	drive	the Company's	organic	growth	across	its	businesses.

BlackRock's	Retail	strategy	is	focused	on	an	outcome-oriented	approach	to	creating client	solutions,	including	active,	passive	and	alternative	products,	and	enhanced distribution.	In	the	United	States,	BlackRock	is	leveraging	its	integrated	wholesaler force	to	further	penetrate	wire	house	distribution	platforms	and	gain	share	amongst Registered	Investment	Advisors.	Internationally,	BlackRock	continues	to	diversify	the range	of	investment	solutions	available	to	clients,	penetrate	new	distribution	segments and	capitalize	on	regulatory	change	impacting	retrocession	arrangements.

iShares	will	be	driven	by	the	continued	shift	from	active	to	passive	investment	strategies and	adoption	of	ETFs.	iShares	is	positioned	to	benefit	from	global	market	expansion, growth	in	fixed	income	ETFs	and	continued	product	innovation,	while	focusing	on increasing	U.S.	market	share,	especially	in	the	"buy-and-hold"	segment.

BlackRock	believes	Institutional	results	will	be	driven	by	strength	in	specialty	areas, including	Defined	Contribution,	Financial	Institutions	and	Official	Institutions,	more effective	cross-selling	efforts	and	leveraging	BlackRock	Solutions'	analytical	and	risk management	expertise.

Assuming	a	stable	market	environment,	BlackRock	anticipates	that	organic	growth, coupled	with	the	benefits	of	scale,	should	result	in	increasing	operating	margins	over time.

BlackRock	believes	that	earnings	growth	and	shareholder	returns	should	also	be positively	impacted	by	the	Company's	commitment	to	a	consistent	and	predictable capital	management	strategy.

# NON-GAAP	FINANCIAL	MEASURES

BlackRock	reports	its	financial	results	in	accordance	with	GAAP;	however, management	believes	evaluating	the	Company's	ongoing	operating	results	may	be enhanced	if	investors	have	additional	non-GAAP	basis	financial	measures. Management	reviews	non-GAAP	financial	measures	to	assess	ongoing	operations	and, for	the	reasons	described	below,	considers	them	to	be	effective	indicators,

for	both	management	and	investors,	of	BlackRock's	financial	performance	over	time. BlackRock's	management	does	not	advocate	that	investors	consider	such	non-GAAP financial	measures	in	isolation	from,	or	as	a	substitute	for,	financial	information prepared	in	accordance	with	GAAP.

Computations	for	all	periods	are	derived	from	the	consolidated	statements	of	income	as follows:

# (a)	Operating	income,	as	adjusted,	and	operating	margin,	as	adjusted:

Operating	income,	as	adjusted,	equals	operating	income,	GAAP	basis,	excluding certain	items	management	deems	nonrecurring,	recurring	infrequently	or	transactions that	ultimately	will	not	impact	BlackRock's	book	value,	as	indicated	in	the	table	below. Management	believes	operating	income,	as	adjusted,	and	operating	margin,	as adjusted,	are	effective	indicators	of	BlackRock's	financial	performance	over	time	and, therefore,	provide	useful	disclosure	to	investors.

| (in	millions) | 2013 | 2012 | 2011 |
| :--- | :--- | :--- | :--- |
| Operating\tincome,\tGAAP\tbasis | $3,857 | $ 3,524 | $ 3,249 |
| Non-GAAP\texpense\tadjustments: |  |  |  |
| PNC\tLTIP\tfunding\tobligation | 33 | 22 | 44 |
| Charitable\tContribution | 124 | — | — |
| U.K.\tlease\texit\tcosts | — | (8) | 63 |
| Contribution\tto\tSTIFs | — | 30 | — |
| Merrill\tLynch\tcompensation\tcontribution | — | — | 7 |
| Restructuring\tcharges | — | — | 32 |
| Compensation\texpense\trelated\tto\tappreciation\t(depreciation)\ton\tdeferred\tcompensation\tplans | 10 | 6 | (3) |
| Operating\tincome,\tas\tadjusted | 4,024 | 3,574 | 3,392 |
| Closed-end\tfund\tlaunch\tcosts | 16 | 22 | 26 |
| Closed-end\tfund\tlaunch\tcommissions | 2 | 3 | 3 |
| Operating\tincome\tused\tfor\toperating\tmargin\tmeasurement | $4,042 | $ 3,599 | $ 3,421 |
| Revenue,\tGAAP\tbasis | $\t10,180 | $\t9,337 | $\t9,081 |
| Non-GAAP\tadjustments: |  |  |  |
| Distribution\tand\tservicing\tcosts | (353) | (364) | (386) |
| Amortization\tof\tdeferred\tsales\tcommissions | (52) | (55) | (81) |
| Revenue\tused\tfor\toperating\tmargin\tmeasurement | $9,775 | $ 8,918 | $ 8,614 |
| Operating\tmargin,\tGAAP\tbasis | 37.9% | 37.7% | 35.8% |
| Operating\tmargin,\tas\tadjusted | 41.4% | 40.4% | 39.7% |

•	Operating	income,	as	adjusted,	includes	non-GAAP	expense	adjustments.	The portion	of	compensation	expense	associated	with	certain	long-term	incentive plans	("LTIP")	funded	or	to	be	funded	through	share	distributions	to	participants	of BlackRock	stock	held	by	PNC	and	a	Merrill	Lynch	&	Co.,	Inc.	("Merrill	Lynch") cash	compensation	contribution	has	been	excluded	because	it	ultimately	does	not impact	BlackRock's	book	value.	The	expense	related	to	the	Merrill	Lynch	cash compensation	contribution	ceased	at	the	end	of	third	quarter	2011.	In	2013,	the $124	million	expense	related	to	the	Charitable	Contribution	has	been	excluded from	operating	income,	as	adjusted,	due	to	its	nonrecurring	nature	and	because the	noncash,	nonoperating	pre-tax	gain	of	$80	million	directly	related	to	the contributed	PennyMac	investment	is	reported	in	nonoperating	income	(expense). The	U.K.	lease	exit	costs	represent	costs	to	exit	two	locations	in	London	in	2011. The	amount	in	2012	represents	an	adjustment	related	to	the	estimated	lease	exit costs	initially	recorded	in	2011.

The	contribution	to	STIFs	represents	a	contribution	to	certain	of	the	Company's bank-managed	STIFs.	Restructuring	charges	consist	of	compensation	costs	and professional	fees.	Compensation	expense	associated	with	appreciation (depreciation)	on	investments	related	to	certain	BlackRock	deferred	compensation plans	has	been	excluded	as	returns	on	investments	set	aside	for	these	plans, which	substantially	offset	this	expense,	are	reported	in	nonoperating	income (expense).

Management	believes	operating	income	exclusive	of	these	items	is	a	useful measure	in	evaluating	BlackRock's	operating	performance	and	helps	enhance	the comparability	of	this	information	for	the	reporting	periods	presented.

•	Operating	margin,	as	adjusted,	allows	BlackRock	to	compare	performance	from period	to	period	by	adjusting	for	items	that	may	not	recur,	recur	infrequently	or may	have	an	economic	offset	in

nonoperating	income	(expense).	BlackRock	also	uses	operating	margin,	as adjusted,	to	monitor	corporate	performance	and	efficiency	and	as	a	benchmark	to compare	its	performance	with	other	companies.	Management	uses	both	GAAP and	non-GAAP	financial	measures	in	evaluating	BlackRock's	financial performance.	The	non-GAAP	measure	by	itself	may	pose	limitations	because	it does	not	include	all	of	BlackRock's	revenues	and	expenses.

Operating	income	used	for	measuring	operating	margin,	as	adjusted,	is	equal	to operating	income,	as	adjusted,	excluding	the	impact	of	closed-end	fund	launch	costs and	related	commissions.	Management	believes	the	exclusion	of	such	costs	and related	commissions	is	useful	because	these	costs	can	fluctuate	considerably	and revenues	associated	with	the	expenditure	of	these	costs	will	not	fully	impact BlackRock's	results	until	future	periods.

Revenue	used	for	operating	margin,	as	adjusted,	excludes	distribution	and	servicing costs	paid	to	related	parties	and	other	third	parties.	Management	believes	the exclusion	of	such	costs	is	useful	because	it	creates	consistency	in	the	treatment	for certain	contracts	for	similar	services,	which	due	to	the	terms	of	the	contracts,	are accounted	for	under	GAAP	on	a	net	basis	within	investment	advisory,	administration fees	and	securities	lending	revenue.	Amortization	of	deferred	sales	commissions	is excluded	from	revenue	used	for	operating	margin	measurement,	as	adjusted, because	such	costs,	over	time,	substantially	offset	distribution	fee	revenue	the Company	earns.	For	each	of	these	items,	BlackRock	excludes	from	revenue	used	for operating	margin,	as	adjusted,	the	costs	related	to	each	of	these	items	as	a	proxy	for such	offsetting	revenues.

(b)	Nonoperating	income	(expense),	less	net	income	(loss)	attributable	to noncontrolling	interests,	as	adjusted,	is	presented	below.	The	compensation

expense	offset	is	recorded	in	operating	income.	This	compensation	expense	has	been included	in	nonoperating	income	(expense),	less	net	income	(loss)	attributable	to	NCI, as	adjusted,	to	offset	returns	on	investments	set	aside	for	these	plans,	which	are reported	in	nonoperating	income	(expense),	GAAP	basis.

Management	believes	nonoperating	income	(expense),	less	net	income	(loss) attributable	to	NCI,	as	adjusted,	provides	comparability	of	information	among	reporting periods	and	is	an	effective	measure	for	reviewing	BlackRock's	nonoperating contribution	to	results.	As	compensation	expense	associated	with	(appreciation) depreciation	on	investments	related	to	certain	deferred	compensation	plans,	which	is included	in	operating	income,	substantially	offsets	the	gain	(loss)	on	the	investments set	aside	for	these	plans,	management	believes	nonoperating	income	(expense),	less net	income	(loss)	attributable	to	NCI,	as	adjusted,	provides	a	useful	measure,	for	both management	and	investors,	of	BlackRock's	nonoperating	results	that	impact	book value.	During	2013,	the	noncash,	nonoperating	pre-tax	gain	of	$80	million	related	to	the contributed	PennyMac	investment

has	been	excluded	from	nonoperating	income	(expense),	less	net	income	(loss) attributable	to	NCI,	as	adjusted	due	to	its	nonrecurring	nature	and	because	the	more than	offsetting	associated	Charitable	Contribution	expense	of	$124	million	is	reported	in operating	income.

| (in	millions) | 2013 | 2012 | 2011 |
| :--- | :--- | :--- | :--- |
| Nonoperating\tincome\t(expense),\tGAAP\tbasis | $\t116 | $\t(54) | $\t(114) |
| Less:\tNet\tincome\t(loss)\tattributable\tto\tNCI | 19 | (18) | 2 |
| Nonoperating\tincome\t(expense) | 97 | (36) | (116) |
| Gain\trelated\tto\tCharitable\tContribution | (80) | — | — |
| Compensation\texpense\trelated\tto\t(appreciation)\ndepreciation\ton\tdeferred\tcompensation\tplans | (10) | (6) | 3 |
| Nonoperating\tincome\t(expense),\tless\tnet\tincome\n(loss)\tattributable\tto\tNCI,\tas\tadjusted | $7 | $ (42) | $ (113) |

(c)	Net	income	attributable	to	BlackRock,	as	adjusted:	Management	believes	net income	attributable	to	BlackRock,	Inc.,	as	adjusted,	and	diluted	earnings	per	common share,	as	adjusted,	are	useful	measures	of	BlackRock's	profitability	and	financial performance.	Net	income	attributable	to	BlackRock,	Inc.,	as	adjusted,	equals	net income	attributable	to	BlackRock,	Inc.,	GAAP	basis,	adjusted	for	significant nonrecurring	items,	charges	that	ultimately	will	not	impact	BlackRock's	book	value	or certain	tax	items	that	do	not	impact	cash	flow.

See	note	(a)	Operating	income,	as	adjusted,	and	operating	margin,	as	adjusted,	for information	on	the	PNC	LTIP	funding	obligation,	Merrill	Lynch	compensation contribution,	Charitable	Contribution,	U.K.	lease	exit	costs,	contribution	to	STIFs	and restructuring	charges.

The	2013	results	included	a	tax	benefit	of	approximately	$48	million	recognized	in connection	with	the	Charitable	Contribution.	The	tax	benefit	has	been	excluded	from	net income	attributable	to	BlackRock,	Inc.,	as	adjusted	due	to	the	nonrecurring	nature	of	the Charitable	Contribution.	During	2013,	income	tax	changes	included	adjustments	related to	the	revaluation	of	certain	deferred	income	tax	liabilities,	including	the	effect	of legislation	enacted	in	the	United	Kingdom	and	domestic	state	and	local	income	tax changes.	During	2012,	income	tax	changes	included	adjustments	related	to	the revaluation	of	certain	deferred	income	tax	liabilities,	including	the	effect	of	legislation enacted	in	the	United	Kingdom	and	the	state	and	local	income	tax	effect	resulting	from changes	in	the	Company's	organizational	structure.	During	2011,	income	tax	changes included	adjustments	related	to	the	revaluation	of	certain	deferred	income	tax	liabilities due	to	a	state	tax	election	and	enacted	U.K.,	Japan,	U.S.	state	and	local	tax	legislation. The	resulting	decrease	in	income	taxes	has	been	excluded	from	net	income	attributable to	BlackRock,	Inc.,	as	adjusted,	as	these	items	will	not	have	a	cash	flow	impact	and	to ensure	comparability	among	periods	presented.

| (in	millions,	except	per	share	data) | 2013 | 2012 | 2011 |
| :--- | :--- | :--- | :--- |
| Net\tincome\tattributable\tto\tBlackRock,\tGAAP\tbasis | $ \t2,932 | $ \t2,458 | $\t2,337 |
| Non-GAAP\tadjustments,\tnet\tof\ttax:(d) |  |  |  |
| PNC\tLTIP\tfunding\tobligation | 23 | 14 | 30 |
| Amount\trelated\tto\tthe\tCharitable\tContribution | (4) | — | — |
| U.K.\tlease\texit\tcosts | — | (5) | 43 |
| Contribution\tto\tSTIFs | — | 21 | — |
| Merrill\tLynch\tcompensation\tcontribution | — | — | 5 |
| Restructuring\tcharges | — | — | 22 |
| Income\ttax\tchanges | (69) | (50) | (198) |
| Net\tincome\tattributable\tto\tBlackRock,\tas\tadjusted | $2,882 | $2,438 | $2,239 |
| Allocation\tof\tnet\tincome,\tas\tadjusted,\tto\tcommon\tshares(e) | $2,882 | $2,435 | $2,218 |
| Diluted\tweighted-average\tcommon\tshares\toutstanding(f) | 173.8 | 178.0 | 187.1 |
| Diluted\tearnings\tper\tcommon\tshare,\tGAAP\tbasis(f) | $16.87 | $13.79 | $12.37 |
| Diluted\tearnings\tper\tcommon\tshare,\tas\tadjusted(f) | $16.58 | $13.68 | $11.85 |

(d) For	each	period	presented,	the	non-GAAP	adjustments,	including	the	PNC	LTIP	funding	obligation,	Merrill	Lynch	compensation	contribution,	U.K.	lease	exit	costs,	contribution	to STIFs	and	restructuring	charges	were	tax	effected	at	the	respective	blended	rates	applicable	to	the	adjustments.	Amounts	for	2013	also	included	the	tax	benefit	of	approximately $48	million	related	to	the	Charitable	Contribution.

(e) Amounts	for	2012	and	2011	exclude	net	income	attributable	to	participating	securities	(see	below).

(f) Nonvoting	participating	preferred	stock	is	considered	to	be	a	common	stock	equivalent	for	purposes	of	determining	basic	and	diluted	earnings	per	share	calculations.

Prior	to	2013,	certain	unvested	restricted	stock	units	were	not	included	in	diluted	weighted-average	common	shares	outstanding	as	they	were	deemed	participating	securities	in accordance	with	required	provisions	of	Accounting	Standards	Codification	("ASC")	260-10,	Earnings	per	Share.	In	2012	and	2011,	average	outstanding	participating	securities were	0.2	million	and	1.8	million,	respectively.	For	further	information,	see	Note	22,	Earnings	per	Share,	to	the	consolidated	financial	statements.

AUM	for	reporting	purposes	generally	is	based	upon	how	investment	advisory	and	administration	fees	are	calculated	for	each	portfolio.	Net	asset	values,	total	assets,	committed assets	or	other	measures	may	be	used	to	determine	portfolio	AUM.

# AUM	and	Net	Subscriptions	(Redemptions)	by	Client	Type

|  |  | AUM |  | Net	Subscriptions	(Redemptions) | Net	Subscriptions	(Redemptions) |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| (in\tmillions) | 2013 | 2012 | 2011 | 2013 | 2012(1) | 2011(2) |
| Retail | $487,777 | $403,484 | $363,359 | $38,804 | $11,556 | $13,409 |
| iShares | 914,372 | 752,706 | 593,356 | 63,971 | 85,167 | 53,000 |
| Institutional: |  |  |  |  |  |  |
| Active | 932,410 | 884,695 | 831,275 | (928) | (24,046) | (16,897) |
| Index | 1,677,650 | 1,441,481 | 1,349,956 | 15,266 | (75,142) | 17,837 |
| Total\tinstitutional | 2,610,060 | 2,326,176 | 2,181,231 | 14,338 | (99,188) | 940 |
| Total\tlong-term | 4,012,209 | 3,482,366 | 3,137,946 | 117,113 | (2,465) | 67,349 |
| Cash\tmanagement | 275,554 | 263,743 | 254,665 | 10,056 | 5,048 | (22,899) |
| Advisory(3) | 36,325 | 45,479 | 120,070 | (7,442) | \t(74,540) | \t(29,903) |
| Total | $\t4,324,088 | $\t3,791,588 | $\t3,512,681 | $\t119,727 | $(71,957) | $14,547 |

# AUM	and	Net	Subscriptions	(Redemptions)	by	Product	Type

|  |  | AUM |  | Net	Subscriptions	(Redemptions) | Net	Subscriptions	(Redemptions) |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| (in\tmillions) | 2013 | 2012 | 2011 | 2013 | 2012(1) | 2011(2) |
| Equity | $2,317,695 | $1,845,501 | $1,560,106 | $69,257 | $54,016 | $24,139 |
| Fixed\tincome | 1,242,186 | 1,259,322 | 1,247,722 | 11,508 | (66,829) | 4,326 |
| Multi-asset | 341,214 | 267,748 | 225,170 | 42,298 | 15,817 | 42,654 |
| Alternatives |  |  |  |  |  |  |
| Core | 85,026 | 68,367 | 63,647 | 2,703 | (3,922) | 48 |
| Currency\tand\tcommodities(4) | 26,088 | 41,428 | 41,301 | (8,653) | (1,547) | (3,818) |
| Subtotal | 111,114 | 109,795 | 104,948 | (5,950) | (5,469) | (3,770) |
| Total\tlong-term | 4,012,209 | 3,482,366 | 3,137,946 | 117,113 | (2,465) | 67,349 |
| Cash\tmanagement | 275,554 | 263,743 | 254,665 | 10,056 | 5,048 | \t(22,899) |
| Advisory(3) | 36,325 | 45,479 | 120,070 | (7,442) | (74,540) | (29,903) |
| Total | $\t4,324,088 | $\t3,791,588 | $\t3,512,681 | $\t119,727 | $\t(71,957) | $14,547 |

(1) Amounts	include	the	effect	of	two	single	client	low-fee	institutional	index	fixed	income	outflows	of	$36.0	billion	and	$74.2	billion.

(2) Amounts	exclude	BGI	merger-related	outflows	due	to	manager	concentration	considerations	prior	to	the	third	quarter	of	2011	and	outflows	from	scientific	active	equity	performance	prior	to	the	second	quarter	of	2011	of $28.3	billion.	As	a	result	of	client	investment	manager	concentration	limits	and	the	scientific	active	equity	performance,	outflows	were	expected	to	occur	for	a	period	of	time	subsequent	to	the	close	of	the	BGI transaction.

(3) Advisory	AUM	represents	long-term	portfolio	liquidation	assignments.	Redemptions	include	planned	client	distributions.

The	following	table	presents	the	component	changes	in	BlackRock's	AUM	for	2013,	2012	and	2011.

| (in	millions) | 2013 | 2012 | 2011 |
| :--- | :--- | :--- | :--- |
| Beginning\tassets\tunder\tmanagement | $3,791,588 | $3,512,681 | $3,560,968 |
| Net\tsubscriptions\t(redemptions) |  |  |  |
| Long-term(1) | 117,113 | (2,465) | 67,349 |
| Cash\tmanagement | 10,056 | 5,048 | (22,899) |
| Advisory(2) | (7,442) | (74,540) | (29,903) |
| Total\tnet\tsubscriptions\t(redemptions) | 119,727 | (71,957) | 14,547 |
| BGI\tmerger-related\toutflows(3) | — | — | (28,251) |
| Acquisitions(4) | 26,932 | 13,742 | — |
| Market\tappreciation\t(depreciation) | 398,707 | 321,377 | (27,513) |
| Foreign\texchange(5) | (12,866) | 15,745 | (7,070) |
| Total\tchange | 532,500 | 278,907 | (48,287) |
| Ending\tassets\tunder\tmanagement | $\t4,324,088 | $\t3,791,588 | $\t3,512,681 |

(1) Amounts	include	the	effect	of	two	single	client	low-fee	institutional	index	fixed	income	outflows	of	$36.0	billion	and	$74.2	billion	in	2012.

(3) Amounts	include	outflows	due	to	manager	concentration	considerations	prior	to	the	third	quarter	of	2011	and	outflows	from	scientific	active	equity	performance	prior	to	the	second	quarter	of	2011.	As	a	result	of	client investment	manager	concentration	limits	and	the	scientific	active	equity	performance,	outflows	were	expected	to	occur	for	a	period	of	time	subsequent	to	the	close	of	the	BGI	transaction.

(4) Amounts	include	AUM	acquired	from	the	Company's	acquisition	of	MGPA	in	October	2013	of	$11.0	billion,	the	Credit	Suisse's	ETF	franchise	in	July	2013	(the	"Credit	Suisse	ETF	Transaction")	of	$16.0	billion,	the	Swiss Re	Private	Equity	Partners	acquisition	(the	"SRPEP	Transaction")	in	September	2012	of	$6.2	billion	and	the	Claymore	Investments,	Inc.	acquisition	(the	"Claymore	Transaction")	in	March	2012	of	$7.6	billion.

(5) Foreign	exchange	reflects	the	impact	of	converting	non-U.S.	dollar	denominated	AUM	into	U.S.	dollars	for	reporting	purposes.

BlackRock	has	historically	grown	aggregate	AUM	through	organic	growth	and	acquisitions.	Management	believes	that	the	Company	will	be	able	to	continue	to	grow	AUM	by	focusing on	strong	investment	performance,	efficient	delivery	of	beta	for	passive	products,	client	service,	developing	new	products	and	optimizing	distribution	capabilities.

# Component	Changes	in	AUM	for	2013

The	following	table	presents	the	component	changes	in	AUM	by	client	type	and	product	for	2013.

|  |  | Net |  |  |  |  |  | Full	Year |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | December\t31, | subscriptions |  |  | Market | FX | December\t31, | Average |
| (in\tmillions) | 2012 | (redemptions) | Adjustments(1) | Acquisitions(2) | change | impact(3) | 2013 | AUM(4) |
| Retail: |  |  |  |  |  |  |  |  |
| Equity | $164,748 | $3,641 | $13,066 | $— | $20,743 | $837 | $203,035 | $173,886 |
| Fixed\tincome | 138,425 | 14,197 | 3,897 | — | (5,338) | 294 | 151,475 | 143,929 |
| Multi-asset | 90,626 | 14,821 | 2,663 | — | 9,039 | (95) | 117,054 | 102,276 |
| Alternatives | 9,685 | 6,145 | — | 136 | 136 | 111 | 16,213 | 12,585 |
| Retail\tsubtotal | 403,484 | 38,804 | 19,626 | 136 | 24,580 | 1,147 | 487,777 | 432,676 |
| iShares: |  |  |  |  |  |  |  |  |
| Equity | 534,648 | 74,119 | — | 13,021 | 95,335 | 1,012 | 718,135 | 620,113 |
| Fixed\tincome | 192,852 | (7,450) | — | 1,294 | (8,477) | 616 | 178,835 | 186,264 |
| Multi-asset | 869 | 355 | — | — | 96 | (10) | 1,310 | 1,115 |
| Alternatives | 24,337 | (3,053) | — | 1,645 | (6,863) | 26 | 16,092 | 20,084 |
| iShares\tsubtotal | 752,706 | 63,971 | — | 15,960 | 80,091 | 1,644 | 914,372 | 827,576 |
| Institutional: |  |  |  |  |  |  |  |  |
| Active: |  |  |  |  |  |  |  |  |
| Equity | 129,024 | (16,504) | — | — | 27,930 | (1,724) | 138,726 | 131,254 |
| Fixed\tincome | 518,102 | (3,560) | — | — | (6,247) | (3,186) | 505,109 | 504,769 |
| Multi-asset | 166,708 | 28,955 | 3,335 | — | 14,193 | 2,085 | 215,276 | 184,958 |
| Alternatives | 70,861 | (9,819) | — | 10,836 | 2,593 | (1,172) | 73,299 | 68,364 |
| Active\tsubtotal | 884,695 | (928) | 3,335 | 10,836 | 38,469 | (3,997) | 932,410 | 889,345 |
| Index: |  |  |  |  |  |  |  |  |
| Equity | 1,017,081 | 8,001 | \t(18,238) | — | 260,333 | (9,378) | 1,257,799 | 1,145,499 |
| Fixed\tincome | 409,943 | 8,321 | (4,723) | — | (4,840) | (1,934) | 406,767 | 405,502 |
| Multi-asset | 9,545 | (1,833) | — | — | 476 | (614) | 7,574 | 8,913 |
| Alternatives | 4,912 | 777 | — | — | (259) | 80 | 5,510 | 5,440 |
| Index\tsubtotal | 1,441,481 | 15,266 | (22,961) | — | 255,710 | (11,846) | 1,677,650 | 1,565,354 |
| Institutional\tsubtotal | 2,326,176 | 14,338 | (19,626) | 10,836 | 294,179 | (15,843) | 2,610,060 | 2,454,699 |
| Long-term | 3,482,366 | 117,113 | — | 26,932 | 398,850 | \t(13,052) | 4,012,209 | $\t3,714,951 |
| Cash\tmanagement | 263,743 | 10,056 | — | — | 395 | 1,360 | 275,554 |  |
| Advisory(5) | 45,479 | (7,442) | — | — | (538) | (1,174) | 36,325 |  |
| Total | $\t3,791,588 | $\t119,727 | $— | $\t26,932 | $\t398,707 | $\t(12,866) | $\t4,324,088 |  |

(2) Amounts	represent	$16.0	billion	of	AUM	acquired	in	the	Credit	Suisse	ETF	Transaction	in	July	2013	and	$11.0	billion	of	AUM	acquired	in	the	MGPA	acquisition	in	October	2013.

(4) Average	AUM	is	calculated	as	the	average	of	the	month-end	spot	AUM	amounts	for	the	trailing	thirteen	months.

The	following	table	presents	component	changes	in	AUM	by	product	for	2013.

|  |  | Net |  |  |  |  |  | Full	Year |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | December\t31, | subscriptions |  |  | Market | FX | December\t31, | Average |
| (in\tmillions) | 2012 | (redemptions) | Adjustments(1) | Acquisitions(2) | change | impact(3) | 2013 | AUM(4) |
| Equity: |  |  |  |  |  |  |  |  |
| Active | $\t287,215 | $\t(15,377) | $\t— | $\t— | $\t46,530 | $\t(1,106) | $\t317,262 | $\t295,776 |
| iShares | 534,648 | 74,119 | — | 13,021 | 95,335 | 1,012 | 718,135 | 620,113 |
| Fixed\tincome: |  |  |  |  |  |  |  |  |
| Active | 656,331 | 10,443 | — | — | (11,584) | (2,981) | 652,209 | 648,143 |
| iShares | 192,852 | (7,450) | — | 1,294 | (8,477) | 616 | 178,835 | 186,264 |
| Multi-asset | 267,748 | 42,298 | 5,998 | — | 23,804 | 1,366 | 341,214 | 297,262 |
| Alternatives: |  |  |  |  |  |  |  |  |
| Core | 68,367 | 2,703 | — | 10,972 | 3,012 | (28) | 85,026 | 73,827 |
| Currency\tand\tcommodities(6) | 41,428 | (8,653) | — | 1,645 | (7,405) | (927) | 26,088 | 32,646 |
| Subtotal | 2,048,589 | 98,083 | 5,998 | 26,932 | 141,215 | (2,048) | 2,318,769 | 2,154,031 |
| Non-ETF\tIndex: |  |  |  |  |  |  |  |  |
| Equity | 1,023,638 | 10,515 | (5,172) | — | 262,476 | (9,159) | 1,282,298 | 1,154,863 |
| Fixed\tincome | 410,139 | 8,515 | (826) | — | (4,841) | (1,845) | 411,142 | 406,057 |
| Subtotal\tNon-ETF\tIndex | 1,433,777 | 19,030 | \t(5,998) | — | 257,635 | (11,004) | 1,693,440 | 1,560,920 |
| Long-term | 3,482,366 | 117,113 | — | 26,932 | 398,850 | (13,052) | 4,012,209 | $ \t3,714,951 |
| Cash\tmanagement | 263,743 | 10,056 | — | — | 395 | 1,360 | 275,554 |  |
| Advisory(5) | 45,479 | (7,442) | — | — | (538) | (1,174) | 36,325 |  |
| Total | $\t3,791,588 | $\t119,727 | $— | $\t26,932 | $\t398,707 | $\t(12,866) | $\t4,324,088 |  |

AUM	increased	$532.5	billion,	or	14%,	to	$4.324	trillion	at	December	31,	2013	from $3.792	trillion	at	December	31,	2012.	The	increase	in	AUM	was	driven	by	net	market appreciation	of	$398.7	billion,	net	inflows	of	$119.7	billion	and	acquired	AUM	related	to the	MGPA	acquisition	and	the	Credit	Suisse	ETF	Transaction,	partially	offset	by	foreign exchange	net	losses.

Net	market	appreciation	of	$398.7	billion	included	$404.3	billion	from	equity	products, primarily	due	to	positive	movements	in	U.S.	and	global	equity	markets.

The	$12.9	billion	decrease	in	AUM	from	foreign	exchange	movements	was	due	to	the strengthening	of	the	U.S.	dollar,	primarily	against	the	Japanese	yen	and	the	Canadian dollar,	partially	offset	by	the	weakening	of	the	U.S.	dollar	against	the	pound	sterling	and the	euro.

|  | December	31, | subscriptions |  | Market | FX | December	31, |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| (in\tmillions) | 2011 | (redemptions)(1) | Acquisitions(2) | change | impact(3) | 2012 |
| Retail: |  |  |  |  |  |  |
| Equity | $156,412 | $(5,359) | $68 | $12,835 | $792 | $164,748 |
| Fixed\tincome | 115,055 | 15,965 | — | 7,350 | 55 | 138,425 |
| Multi-asset | 82,785 | 630 | — | 7,146 | 65 | 90,626 |
| Alternatives | 9,107 | 320 | 164 | 16 | 78 | 9,685 |
| Retail\tsubtotal | 363,359 | 11,556 | 232 | 27,347 | 990 | 403,484 |
| iShares: |  |  |  |  |  |  |
| Equity | 419,651 | 52,973 | 3,517 | 56,433 | 2,074 | 534,648 |
| Fixed\tincome | 153,802 | 28,785 | 3,026 | 6,325 | 914 | 192,852 |
| Multi-asset | 562 | 178 | 78 | 50 | 1 | 869 |
| Alternatives | 19,341 | 3,231 | 701 | 1,047 | 17 | 24,337 |
| iShares\tsubtotal | 593,356 | 85,167 | 7,322 | 63,855 | 3,006 | 752,706 |
| Institutional: |  |  |  |  |  |  |
| Active: |  |  |  |  |  |  |
| Equity | 125,515 | (14,139) | — | 16,766 | 882 | 129,024 |
| Fixed\tincome | 499,927 | (15,060) | — | 33,179 | 56 | 518,102 |
| Multi-asset | 135,678 | 12,333 | — | 16,826 | 1,871 | 166,708 |
| Alternatives | 70,155 | (7,180) | 6,161 | 2,284 | (559) | 70,861 |
| Active\tsubtotal | 831,275 | (24,046) | 6,161 | 69,055 | 2,250 | 884,695 |
| Index: |  |  |  |  |  |  |
| Equity | 858,528 | 20,541 | 27 | 137,679 | 306 | 1,017,081 |
| Fixed\tincome | 478,938 | (96,519) | — | 20,986 | 6,538 | 409,943 |
| Multi-asset | 6,145 | 2,676 | — | 1,050 | (326) | 9,545 |
| Alternatives | 6,345 | (1,840) | — | 226 | 181 | 4,912 |
| Index\tsubtotal | 1,349,956 | (75,142) | 27 | 159,941 | 6,699 | 1,441,481 |
| Institutional\tsubtotal | 2,181,231 | (99,188) | 6,188 | 228,996 | 8,949 | 2,326,176 |
| Long-term | 3,137,946 | (2,465) | 13,742 | 320,198 | 12,945 | 3,482,366 |
| Cash\tmanagement | 254,665 | 5,048 | — | 1,983 | 2,047 | 263,743 |
| Advisory(4) | 120,070 | (74,540) | — | (804) | 753 | 45,479 |
| Total | $\t3,512,681 | $\t(71,957) | $\t13,742 | $\t321,377 | $\t15,745 | $\t3,791,588 |

(1) Amount	includes	the	effect	of	two	single	client	low-fee	institutional	index	fixed	income	outflows	of	$36.0	billion	and	$74.2	billion.

(2) Amounts	represent	AUM	acquired	in	the	SRPEP	Transaction	in	September	2012	of	$6.2	billion	and	the	Claymore	Transaction	in	March	2012	of	$7.6	billion.

|  | December	31, | subscriptions |  | Market | FX | December	31, |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| (in\tmillions) | 2011 | (redemptions)(1) | Acquisitions(2) | change | impact(3) | 2012 |
| Equity: |  |  |  |  |  |  |
| Active | $275,156 | $(18,111) | $— | $28,550 | $1,620 | $287,215 |
| iShares | 419,651 | 52,973 | 3,517 | 56,433 | 2,074 | 534,648 |
| Fixed\tincome: |  |  |  |  |  |  |
| Active | 614,804 | 892 | — | 40,524 | 111 | 656,331 |
| iShares | 153,802 | 28,785 | 3,026 | 6,325 | 914 | 192,852 |
| Multi-asset | 225,170 | 15,817 | 78 | 25,072 | 1,611 | 267,748 |
| Alternatives: |  |  |  |  |  |  |
| Core | 63,647 | (3,922) | 6,166 | 2,266 | 210 | 68,367 |
| Currency\tand\tcommodities(4) | 41,301 | (1,547) | 860 | 1,307 | (493) | 41,428 |
| Subtotal | 1,793,531 | \t\t74,887 | 13,647 | 160,477 | 6,047 | 2,048,589 |
| Non-ETF\tIndex: |  |  |  |  |  |  |
| Equity | 865,299 | 19,154 | 95 | 138,730 | 360 | 1,023,638 |
| Fixed\tincome | 479,116 | (96,506) | — | 20,991 | 6,538 | 410,139 |
| Subtotal\tNon-ETF\tIndex | 1,344,415 | (77,352) | 95 | 159,721 | 6,898 | 1,433,777 |
| Long-term | 3,137,946 | (2,465) | 13,742 | 320,198 | 12,945 | 3,482,366 |
| Cash\tmanagement | 254,665 | 5,048 | — | 1,983 | 2,047 | 263,743 |
| Advisory(5) | 120,070 | (74,540) | — | (804) | 753 | 45,479 |
| Total | $\t3,512,681 | $(71,957) | $\t13,742 | $\t321,377 | $\t15,745 | $\t3,791,588 |

(2) Amounts	represent	AUM	acquired	in	the	SRPEP	Transaction	in	September	2012	of	$6.2	billion	and	Claymore	Transaction	in	March	2012	of	$7.6	billion.

AUM	increased	$278.9	billion,	or	8%,	to	$3.792	trillion	at	December	31,	2012	from $3.513	trillion	at	December	31,	2011.	The	increase	in	AUM	was	driven	largely	by market	gains	and	positive	net	new	business,	excluding	the	effect	of	two	single	client low-fee,	institutional	index	fixed	income	outflows	of	$36.0	billion	and	$74.2	billion	in	the first	quarter	of	2012	and	the	third	quarter	of	2012,	respectively.	Total	flows	included $74.5	billion	of	planned	advisory	distributions	and	acquired	AUM	related	to	the	SRPEP and	the	Claymore	Transactions	of	$13.7	billion.

Net	market	appreciation	of	$321.4	billion	reflected	growth	in	U.S.	and	global	equity markets	and	$67.8	billion	appreciation	in	fixed	income	products	across	the	majority	of strategies.

The	$15.7	billion	net	increase	in	AUM	from	converting	non-U.S.	dollar	denominated AUM	into	U.S.	dollars	was	primarily	due	to	the	weakening	of	the	U.S.	dollar	against	the pound	sterling	and	the	euro,	partially	offset	by	the	strengthening	of	the	U.S.	dollar against	the	Japanese	yen.

# DISCUSSION	OF	FINANCIAL	RESULTS

# Introduction

BlackRock	derives	a	substantial	portion	of	its	revenue	from	investment	advisory	and administration	fees,	which	are	recognized	as	the	services	are	performed.	Such	fees	are primarily	based	on	predetermined	percentages	of	the	market	value	of	AUM	or percentages	of	committed	capital	during	investment	periods	of	certain	alternative products	and	are	affected	by	changes	in	AUM,	including	market

appreciation	or	depreciation,	foreign	exchange	translation	and	net	subscriptions	or redemptions.	Net	subscriptions	or	redemptions	represent	the	sum	of	new	client	assets, additional	fundings	from	existing	clients	(including	dividend	reinvestment),	withdrawals of	assets	from,	and	termination	of,	client	accounts	and	distributions	to	investors representing	return	of	capital	and	return	on	investments	to	investors.	Market appreciation	or	depreciation	includes	current	income	earned	on,	and	changes	in	the	fair value	of,	securities	held	in	client	accounts.	Foreign	exchange	translation	reflects	the impact	of	converting	non-U.S.	dollar	denominated	AUM	into	U.S.	dollars	for	reporting purposes.

BlackRock	also	earns	revenue	by	lending	securities	on	behalf	of	clients	to	highly	rated banks	and	broker-dealers.	The	securities	loaned	are	secured	by	collateral	in	the	form	of cash	or	securities,	with	minimum	collateral	generally	ranging	from	approximately	102% to	112%	of	the	value	of	the	loaned	securities.	Generally,	the	revenue	earned	is	shared between	BlackRock	and	the	funds	or	accounts	managed	by	the	Company	from	which the	securities	are	borrowed.	Historically,	securities	lending	revenue	in	the	second quarter	exceeds	the	other	quarters	during	the	year	driven	by	higher	seasonal	demand.

Investment	advisory	agreements	for	certain	separate	accounts	and	investment	funds provide	for	performance	fees	based	upon	relative	and/or	absolute	investment performance,	in	addition	to	base	fees	based	on	AUM.	Investment	advisory performance	fees	generally	are	earned	after	a	given	period	of	time	and	when investment	performance	exceeds	a	contractual	threshold.	As	such,	the

timing	of	recognition	of	performance	fees	may	increase	the	volatility	of	BlackRock's revenue	and	earnings.	Historically,	the	magnitude	of	performance	fees	in	the	third	and fourth	quarters	generally	exceeds	that	of	the	first	two	calendar	quarters	in	a	year	due	to the	greater	number	of	products	with	performance	measurement	periods	that	end	on either	September	30	or	December	31.

BlackRock	provides	a	variety	of	risk	management,	investment	analytic	and	investment system	and	advisory	services	to	financial	institutions,	pension	funds,	asset	managers, foundations,	consultants,	mutual	fund	sponsors,	real	estate	investment	trusts	and government	agencies.	These	services	are	provided	under	the	brand	name	BlackRock Solutions	and	include	a	wide	array	of	risk	management	services,	valuation	services related	to	illiquid	securities,	disposition	and	workout	assignments	(including	long-term portfolio	liquidation	assignments),	strategic	planning	and	execution,	and	enterprise investment	system	outsourcing	to	clients.	The	Company's	Aladdin®	operating	platform serves	as	the	investment/risk	solutions	system	for	BlackRock	and	other	institutional investors.	Fees	earned	for	BlackRock	Solutions	and	advisory	services	are	determined using	some,	or	all,	of	the	following	methods:	(i)	percentages	of	various	attributes	of advisory	AUM	or	value	of	positions	on	the	Aladdin	platform,	(ii)	fixed	fees	and (iii)	performance	fees	if	contractual	thresholds	are	met.

BlackRock	builds	upon	its	leadership	position	to	meet	the	growing	need	for	investment and	risk	management	solutions.	Through	its	scale	and	diversity	of	products,	it	is	able	to provide	its	clients	with	customized	solutions	including	fiduciary	outsourcing	for	liability- driven	investments	and	overlay	strategies	for	pension	plan	sponsors,	balance	sheet management	and	related	services	for	insurance	companies	and	target	date	and	target return	funds,	as	well	as	asset	allocation	portfolios,	for	retail	investors.	BlackRock	is	also able	to	service	these	clients	via	its	Aladdin	platform	to	provide	risk	management	and other	outsourcing	services	for	institutional	investors	and	custom	and	tailored	solutions	to address	complex	risk	exposures.

The	Company	earns	fees	for	transition	management	services	primarily	comprised	of commissions	from	acting	as	a	broker-dealer	in	connection	with	buying	and	selling securities	on	behalf	of	its	customers.	Commissions	related	to	transition	management services	are	recorded	on	a	trade-date	basis	as	securities	transactions	occur.

The	Company	also	earns	revenue	related	to	certain	strategic	investments	accounted for	as	equity	method	investments.

Operating	expenses	reflect	employee	compensation	and	benefits,	distribution	and servicing	costs,	amortization	of	deferred	sales	commissions,	direct	fund	expenses, general	and	administration	expenses	and	amortization	of	finite-lived	intangible	assets.

•	Employee	compensation	and	benefits	expense	includes	salaries,	commissions, temporary	help,	deferred	and	incentive	compensation,	employer	payroll	taxes, severance	and	related	benefit	costs.

•	Distribution	and	servicing	costs,	which	are	primarily	AUM	driven,	include payments	made	to	Merrill	Lynch-affiliated	entities	under	a	global	distribution agreement,	to	PNC	and	Barclays,	as	well	as	other	third	parties,	primarily associated	with	obtaining	and	retaining	client	investments	in	certain	BlackRock products.

•	Direct	fund	expenses	primarily	consist	of	third-party	nonadvisory	expenses incurred	by	BlackRock	related	to	certain	funds	for	the	use	of	index	trademarks, reference	data	for	indices,	custodial	services,	fund	administration,	fund	accounting, transfer	agent	services,	shareholder	reporting	services,	legal	expenses,	audit	and tax	services	as	well	as	other	fund-related	expenses	directly	attributable	to	the nonadvisory	operations	of	the	fund.	These	expenses	may	vary	over	time	with fluctuations	in	AUM,	number	of	shareholder	accounts,	or	other	attributes	directly related	to	volume	of	business.

•	General	and	administration	expenses	include	marketing	and	promotional, occupancy	and	office-related	costs,	portfolio	services	(including	clearing	expenses related	to	transition	management	services),	technology,	professional	services, communications,	closed-end	fund	launch	costs	and	other	general	and administration	expenses,	including	the	impact	of	foreign	currency	remeasurement.

Nonoperating	income	(expense)	includes	the	effect	of	changes	in	the	valuations	on investments	(excluding	available-for-sale	investments)	and	earnings	on	equity	method investments	as	well	as	interest	and	dividend	income	and	interest	expense.	Other comprehensive	income	includes	changes	in	valuations	related	to	available-for-sale investments.	BlackRock	primarily	holds	seed	and	co-investments	in	sponsored investment	products	that	invest	in	a	variety	of	asset	classes,	including	private	equity, distressed	credit/mortgage	debt	securities,	hedge	funds	and	real	estate.	Investments generally	are	made	for	co-investment	purposes,	to	establish	a	performance	track record,	to	hedge	exposure	to	certain	deferred	compensation	plans	or	for	regulatory purposes,	including	Federal	Reserve	Bank	stock.	BlackRock	does	not	engage	in proprietary	trading	activities	that	could	conflict	with	the	interests	of	its	clients.

In	addition,	nonoperating	income	(expense)	includes	the	impact	of	changes	in	the valuations	of	consolidated	sponsored	investment	funds	and	consolidated	collateralized loan	obligations	("CLOs").	The	portion	of	nonoperating	income	(expense)	not attributable	to	BlackRock	is	allocated	to	NCI	on	the	consolidated	statements	of	income.

# Revenue

| (in	millions) | 2013 | 2012 | 2011 |
| :--- | :--- | :--- | :--- |
| Investment\tadvisory,\tadministration\tfees\tand\tsecurities\tlending\trevenue: |  |  |  |
| Equity: |  |  |  |
| Active | $1,741 | $1,753 | $1,967 |
| iShares | 2,390 | 1,941 | 1,847 |
| Fixed\tincome: |  |  |  |
| Active | 1,269 | 1,182 | 1,104 |
| iShares | 464 | 441 | 317 |
| Multi-asset | 1,039 | 957 | 894 |
| Alternatives: |  |  |  |
| Core | 576 | 525 | 557 |
| Currency\tand\tcommodities | 107 | 131 | 136 |
| Subtotal | 7,586 | 6,930 | 6,822 |
| Non-ETF\tIndex: |  |  |  |
| Equity | 594 | 552 | 488 |
| Fixed\tincome | 238 | 229 | 203 |
| Subtotal\tNon-ETF\tIndex | 832 | 781 | 691 |
| Long-term | 8,418 | 7,711 | 7,513 |
| Cash\tmanagement | 321 | 361 | 383 |
| Total\tbase\tfees | 8,739 | 8,072 | 7,896 |
| Investment\tadvisory\tperformance\tfees: |  |  |  |
| Equity | 91 | 88 | 145 |
| Fixed\tincome | 25 | 48 | 35 |
| Multi-asset | 24 | 15 | 20 |
| Alternatives | 421 | 312 | 171 |
| Total | 561 | 463 | 371 |
| BlackRock\tSolutions\tand\tadvisory | 577 | 518 | 510 |
| Distribution\tfees | 73 | 71 | 100 |
| Other\trevenue | 230 | 213 | 204 |
| Total\trevenue | $\t10,180 | $\t9,337 | $\t9,081 |

The	table	below	lists	the	asset	type	mix	of	investment	advisory,	administration	fees	and	securities	lending	revenue	(collectively	"base	fees")	and	mix	of	average	AUM	by	asset	class:

|  |  | Mix	of	Base	Fees |  | Mix	of	Average	AUM	by	Asset	Class(1) | Mix	of	Average	AUM	by	Asset	Class(1) |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| Equity: | 2013 | 2012 | 2011 | 2013 | 2012 | 2011 |
| Active | 20% | 22% | 25% | 7% | 8% | 9% |
| iShares | 26% | 23% | 23% | 16% | 13% | 13% |
| Fixed\tincome: |  |  |  |  |  |  |
| Active | 15% | 15% | 14% | 16% | 18% | 19% |
| iShares | 5% | 5% | 4% | 5% | 5% | 4% |
| Multi-asset | 12% | 12% | 11% | 7% | 7% | 6% |
| Alternatives: |  |  |  |  |  |  |
| Core | 7% | 7% | 7% | 2% | 2% | 2% |
| Currency\tand\tcommodities | 1% | 2% | 2% | 1% | 1% | 1% |
| Subtotal | 86% | 86% | 86% | 54% | 54% | 54% |
| Non-ETF\tIndex: |  |  |  |  |  |  |
| Equity | 7% | 7% | 6% | 29% | 26% | 26% |
| Fixed\tincome | 3% | 3% | 3% | 10% | 13% | 13% |
| Subtotal\tNon-ETF\tIndex: | 10% | 10% | 9% | 39% | 39% | 39% |
| Long-term | 96% | 96% | 95% | 93% | 93% | 93% |
| Cash\tmanagement | 4% | 4% | 5% | 7% | 7% | 7% |
| Total\texcluding\tAdvisory\tAUM | \t 100% | \t 100% | \t 100% | 100% | 100% | 100% |

Revenues	increased	$843	million,	or	9%,	from	2012,	reflecting	growth	in	markets,	long- term	net	inflows	and	strength	in	performance	fees	and	BlackRock	Solutions	and advisory	revenue.

Investment	advisory,	administration	fees	and	securities	lending	revenue	of	$8,739 million	for	2013	increased	$667	million	from	$8,072	million	in	2012	due	to	growth	in long-term	average	AUM.	Securities	lending	fees	decreased	$63	million	from	2012	to $447	million	in	2013	driven	by	lower	spreads	consistent	with	industry	trends,	partially offset	by	an	increase	in	average	balances	of	securities	on	loan.

Investment	advisory	performance	fees	were	$561	million	in	2013	compared	with	$463 million	in	2012,	primarily	reflecting	higher	fees	from	alternative	products,	including	fund of	funds	and	single-strategy	hedge	funds.	Both	years	reflected	significant	fees	from	the liquidation	of	opportunistic	funds.

BlackRock	Solutions	and	advisory	revenue	in	2013	totaled	$577	million	compared	with $518	million	in	2012.	The	current	year	reflected	a	$47	million	increase	in	Aladdin business	revenues	to	$421	million	and	higher	advisory	assignments	revenue.

Other	revenue	increased	$17	million,	largely	reflecting	higher	transition	management service	fees	and	higher	earnings	from	certain	strategic	investments.

Revenues	increased	$256	million,	or	3%,	from	2011	reflecting	market	growth,	positive flows,	improvements	in	securities	lending	revenue	and	strength	in	performance	fees.

Investment	advisory,	administration	fees	and	securities	lending	revenue	totaled	$8,072 million	in	2012	compared	with	$7,896	million	in	2011,	reflecting	an	improvement	in securities	lending	revenue	and	higher	advisory	fees	reflecting	higher	long-term	average AUM.	Securities	lending	fees	were	$510	million	in	2012	compared	with	$397	million	in 2011,	reflecting	higher	lending	rates	and	an	increase	in	average	balances	of	securities on	loan.

Investment	advisory	performance	fees	were	$463	million	in	2012	compared	with	$371 million	in	2011,	primarily	reflecting	higher	performance	fees	from	alternative	products, including	fees	from	a	disposition-related	opportunistic	fund,	which	were	partially	offset by	lower	fees	from	equity	products.

BlackRock	Solutions	and	advisory	revenue	in	2012	increased	$8	million,	or	2%,	from 2011,	primarily	due	to	a	$51	million	increase	in	Aladdin	business	revenue	to	$374 million,	partially	offset	by	the	run	off	of	revenues	associated	with	a	lower	level	of advisory	assets	and	lower	one-time	revenue	from	advisory	assignments.

Distribution	fees	of	$71	million	in	2012	decreased	$29	million,	or	29%,	from	$100	million in	2011,	primarily	due	to	lower	AUM	in	certain	share	classes	of	BlackRock	funds.

Other	revenue	increased	$9	million,	largely	reflecting	higher	earnings	from	certain strategic	investments,	partially	offset	by	lower	sales	commissions	and	marketing	fees earned	for	services	to	distribute	iPath®	products.

# Expenses

| (in	millions) | 2013 | 2012 | 2011 |
| :--- | :--- | :--- | :--- |
| Expenses,\tGAAP: |  |  |  |
| Employee\tcompensation\tand\tbenefits | $3,560 | $3,287 | $3,199 |
| Distribution\tand\tservicing\tcosts | 353 | 364 | 386 |
| Amortization\tof\tdeferred\tsales\tcommissions | 52 | 55 | 81 |
| Direct\tfund\texpenses | 657 | 591 | 563 |
| General\tand\tadministration: |  |  |  |
| Marketing\tand\tpromotional | 409 | 384 | 315 |
| Occupancy\tand\toffice\trelated | 277 | 248 | 373 |
| Portfolio\tservices | 203 | 196 | 189 |
| Technology | 160 | 150 | 146 |
| Professional\tservices | 128 | 114 | 139 |
| Communications | 37 | 39 | 40 |
| Regulatory,\tfiling\tand\tlicense\tfees | 31 | 17 | 16 |
| Charitable\tContribution | 124 | — | — |
| Closed-end\tfund\tlaunch\tcosts | 16 | 22 | 26 |
| Other\tgeneral\tand\tadministration | 155 | 189 | 171 |
| Total\tgeneral\tand\tadministration\texpenses | 1,540 | 1,359 | 1,415 |
| Restructuring\tcharges | — | — | 32 |
| Amortization\tof\tintangible\tassets | 161 | 157 | 156 |
| Total\texpenses,\tGAAP | $6,323 | $5,813 | $5,832 |
| Less\tnon-GAAP\texpense\tadjustments: |  |  |  |
| Employee\tcompensation\tand\tbenefits: |  |  |  |
| PNC\tLTIP\tfunding\tobligation | 33 | 22 | 44 |
| Merrill\tLynch\tcompensation\tcontribution | — | — | 7 |
| Compensation\texpense\trelated\tto\tappreciation\t(depreciation)\ton\tdeferred\tcompensation\tplans | 10 | 6 | (3) |
| Subtotal | 43 | 28 | 48 |
| General\tand\tadministration: |  |  |  |
| Charitable\tContribution | 124 | — | — |
| U.K.\tlease\texit\tcosts | — | (8) | 63 |
| Contribution\tto\tSTIFs | — | 30 | — |
| Subtotal | 124 | 22 | 63 |
| Restructuring\tcharges | — | — | 32 |
| Total\tnon-GAAP\texpense\tadjustments | 167 | 50 | 143 |
| Expenses,\tas\tadjusted: |  |  |  |
| Employee\tcompensation\tand\tbenefits | 3,517 | 3,259 | 3,151 |
| Distribution\tand\tservicing\tcosts | 353 | 364 | 386 |
| Amortization\tof\tdeferred\tsales\tcommissions | 52 | 55 | 81 |
| Direct\tfund\texpenses | 657 | 591 | 563 |
| General\tand\tadministration | 1,416 | 1,337 | 1,352 |
| Amortization\tof\tintangible\tassets | 161 | 157 | 156 |
| Total\texpenses,\tas\tadjusted | $ \t6,156 | $ \t5,763 | $\t5,689 |

GAAP.	Expenses	increased	$510	million,	or	9%,	from	2012,	primarily	reflecting	higher revenue-related	expenses	and	the	$124	million	expense	related	to	the	Charitable Contribution.

Employee	compensation	and	benefits	expense	increased	$273	million,	or	8%,	to $3,560	million	in	2013	from	$3,287	million	in	2012,	reflecting	increased	headcount	and higher	incentive	compensation	driven	by	higher	operating	income,	including	higher performance	fees.	Employees	at	December	31,	2013	totaled	approximately	11,400 compared	with	approximately	10,500	at	December	31,	2012.

Distribution	and	servicing	costs	totaled	$353	million	in	2013	compared	with	$364	million in	2012.	These	costs	included	payments	to	Bank	of	America/Merrill	Lynch	under	a global

distribution	agreement	and	PNC,	as	well	as	other	third	parties,	primarily	associated	with the	distribution	and	servicing	of	client	investments	in	certain	BlackRock	products. Distribution	and	servicing	costs	for	2013	and	2012	included	$184	million	and	$195 million,	respectively,	of	costs	attributable	to	Bank	of	America/Merrill	Lynch.

Direct	fund	expenses	increased	$66	million,	reflecting	higher	average	AUM,	primarily related	to	iShares,	where	BlackRock	pays	certain	nonadvisory	expenses	of	the	funds.

General	and	administration	expenses	increased	$181	million,	largely	driven	by	the	$124 million	expense	related	to	the	Charitable	Contribution,	higher	marketing	and promotional	costs	and	various	lease	exit	costs.	The	full	year	2012	included	a	one-time $30	million	contribution	to	STIFs.

As	Adjusted.	Expenses,	as	adjusted,	increased	$393	million,	or	7%,	to	$6,156	million in	2013	from	$5,763	million	in	2012.	The	increase	in	total	expenses,	as	adjusted,	is primarily	attributable	to	increases	in	employee	compensation	and	benefits,	direct	fund expenses	and	general	and	administration	expenses.

GAAP.	Expenses	decreased	$19	million	to	$5,813	million	from	2011,	primarily reflecting	a	reduction	in	general	and	administration	expenses,	amortization	of	deferred sales	commissions	and	distribution	and	servicing	costs,	partially	offset	by	higher employee	compensation	and	benefits	and	direct	fund	expenses.	General	and administration	expenses	in	2012	included	a	$30	million	charge	related	to	a	contribution to	STIFs.

Employee	compensation	and	benefits	expense	increased	$88	million,	or	3%,	to	$3,287 million	in	2012	from	$3,199	million	in	2011,	reflecting	an	increase	in	incentive compensation	driven	by	higher	operating	income,	including	higher	performance	fees. Employees	at	December	31,	2012	totaled	approximately	10,500	compared	with approximately	10,100	at	December	31,	2011.

Distribution	and	servicing	costs	decreased	$22	million,	or	6%,	to	$364	million	in	2012 from	$386	million	in	2011.	The	$22	million	decrease	related	to	lower	service	fees	from variable	annuities	and	lower	cash	management-related	distribution	costs.	Distribution and	servicing	costs	for	2012	and	2011	included	$195	million	and	$207	million, respectively,	of	costs	attributable	to	Bank	of	America/Merrill	Lynch.

Amortization	of	deferred	sales	commissions	decreased	$26	million,	or	32%,	to	$55 million	in	2012	from	$81	million	in	2011,	primarily	related	to	lower	sales	in	certain	share classes	of	U.S.	open-end	mutual	funds.

Direct	fund	expenses	increased	$28	million	from	2011	million,	primarily	reflecting growth	in	average	AUM	for	the	funds	(predominantly	iShares)	where	BlackRock	pays certain	nonadvisory	expenses	of	the	funds.

General	and	administration	expenses	decreased	$56	million,	or	4%,	to	$1,359	million	in 2012	from	$1,415	million	in	2011.	Lower	occupancy	and	office-related	expenses, primarily	due	to	$63	million	of	U.K.	lease	exit	costs	incurred	in	2011,	and

lower	professional	services	costs	contributed	to	the	overall	net	decrease	in	general	and administration	expenses.	The	decrease	in	general	and	administration	expenses	was partially	offset	by	higher	marketing	and	promotional	expenses	in	connection	with	the brand	campaign	and	a	one-time	contribution	to	STIFs.

Restructuring	charges	of	$32	million	recorded	in	2011,	primarily	related	to	severance, accelerated	amortization	of	certain	previously	granted	stock	awards,	and	legal	and outplacement	costs	associated	with	a	reduction	in	work	force	and	reengineering	efforts.

As	Adjusted.	Expenses,	as	adjusted,	increased	$74	million,	or	1%,	to	$5,763	million	in 2012	from	$5,689	million	in	2011.	The	increase	in	total	expenses,	as	adjusted,	is primarily	attributable	to	increases	in	employee	compensation	and	benefits	and	direct fund	expenses,	partially	offset	by	a	reduction	in	amortization	of	deferred	sales commissions,	distribution	and	servicing	costs	and	general	and	administration	expenses.

# NONOPERATING	RESULTS

Nonoperating	income	(expense),	less	net	income	(loss)	attributable	to	NCI	for	2013, 2012	and	2011	was	as	follows:

| (in	millions) | 2013 | 2012 | 2011 |
| :--- | :--- | :--- | :--- |
| Nonoperating\tincome\t(expense),\tGAAP\tbasis(1) | $\t116 | $\t(54) | $\t(114) |
| Less:\tNet\tincome\t(loss)\tattributable\tto\tNCI | 19 | (18) | 2 |
| Nonoperating\tincome\t(expense)(2) | 97 | (36) | (116) |
| Gain\trelated\tto\tthe\tCharitable\tContribution | (80) | — | — |
| Compensation\texpense\trelated\tto\t(appreciation) |  |  |  |
| depreciation\ton\tdeferred\tcompensation\tplans | (10) | (6) | 3 |
| Nonoperating\tincome\t(expense),\tas\tadjusted(2) | $7 | $ (42) | $ (113) |

(1) During	2013,	the	Company	did	not	record	any	nonoperating	income	(loss)	or	net	income	(loss) attributable	to	consolidated	variable	interest	entities	on	the	consolidated	statements	of	income. Amounts	included	losses	of	$38	million	and	$18	million	attributable	to	consolidated	variable	interest entities	for	2012	and	2011,	respectively.

(2) Net	of	net	income	(loss)	attributable	to	NCI.

The	components	of	nonoperating	income	(expense),	less	net	income	(loss)	attributable	to	NCI	for	2013,	2012	and	2011	were	as	follows:

| (in	millions) | 2013 | 2012 | 2011 |
| :--- | :--- | :--- | :--- |
| Net\tgain\t(loss)\ton\tinvestments(1) |  |  |  |
| Private\tequity | $52 | $36 | $36 |
| Real\testate | 24 | 14 | 10 |
| Distressed\tcredit/mortgage\tfunds | 40 | 69 | (13) |
| Hedge\tfunds/funds\tof\thedge\tfunds | 25 | 20 | (5) |
| Other\tinvestments(2) | 16 | (2) | 1 |
| Subtotal | 157 | 137 | 29 |
| Gain\trelated\tto\tthe\tPennyMac\tIPO | 39 | — | — |
| Gain\trelated\tto\tthe\tCharitable\tContribution | 80 | — | — |
| Investments\trelated\tto\tdeferred\tcompensation\tplans | 10 | 6 | (3) |
| Total\tnet\tgain\t(loss)\ton\tinvestments | 286 | 143 | 26 |
| Interest\tand\tdividend\tincome | 22 | 36 | 34 |
| Interest\texpense | \t(211) | \t(215) | (176) |
| Net\tinterest\texpense | (189) | (179) | (142) |
| Total\tnonoperating\tincome\t(expense)(1) | 97 | (36) | (116) |
| Gain\trelated\tto\tthe\tCharitable\tContribution | (80) | — | — |
| Compensation\texpense\trelated\tto\t(appreciation)\tdepreciation\ton\tdeferred\tcompensation\tplans | (10) | (6) | 3 |
| Nonoperating\tincome\t(expense),\tas\tadjusted(1) | $7 | $(42) | $\t(113) |

(2) Amount	included	net	gains	(losses)	related	to	equity	and	fixed	income	investments,	and	BlackRock's	seed	capital	hedging	program.

Net	gains	on	investments	of	$286	million	in	2013	increased	$143	million	from	2012	due to	the	$39	million	gain	related	to	the	PennyMac	IPO	and	the	$80	million	gain	related	to the	Charitable	Contribution	and	higher	net	positive	marks.

Net	interest	expense	increased	$10	million	from	2012	primarily	due	to	lower	dividend income.

For	further	information	on	the	Company's	long-term	debt,	see	Liquidity	and	Capital Resources	herein.

Net	gains	on	investments	increased	$117	million	from	2011	due	to	higher	net	positive marks	in	2012	compared	with	2011.

Net	interest	expense	increased	from	2011,	primarily	due	to	long-term	debt	issuances	in May	2011	and	May	2012.

# Income	Tax	Expense

|  |  | GAAP |  |  | As	adjusted |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| (in\tmillions) | 2013 | 2012 | 2011 | 2013 | 2012 | 2011 |
| Income\tbefore\tincome\ttaxes(1) | $ \t3,954 | $ \t3,488 | $ \t3,133 | $ \t4,031 | $ \t3,532 | $\t3,279 |
| Income\ttax\texpense | $1,022 | $1,030 | $796 | $1,149 | $1,094 | $1,040 |
| Effective\ttax\trate | 25.8% | 29.5% | 25.4% | 28.5% | 31.0% | 31.7% |

The	Company's	tax	rate	is	affected	by	tax	rates	in	foreign	jurisdictions	and	the	relative amount	of	income	earned	in	those	jurisdictions,	which	the	Company	expects	to	be	fairly consistent	in	the	near	term.	The	significant	foreign	jurisdictions,	which	have	lower statutory	tax	rates	than	the	U.S.	federal	statutory	rate	of	35%,	include	the	United Kingdom,	Luxembourg,	Canada	and	the	Netherlands.	U.S.	income	taxes	were	not provided	for	certain	undistributed	foreign	earnings	intended	to	be	indefinitely	reinvested outside	the	United	States.

2013.	The	GAAP	effective	tax	rate	of	25.8%	for	2013	included	a	$69	million	net noncash	benefit	primarily	related	to	the	revaluation	of	certain	deferred	income	tax liabilities,	including	the	effect	of	legislation	enacted	in	the	United	Kingdom	and	domestic state	and	local	income	tax	changes.	In	addition,	2013	included	the	approximately	$48 million	tax	benefit	recognized	in	connection	with	the	Charitable	Contribution,	a	tax benefit	of	approximately	$29	million,	primarily	due	to	the	realization	of	tax	loss carryforwards,	and	benefits	from	certain	nonrecurring	items.

The	as	adjusted	effective	tax	rate	of	28.5%	for	2013	included	a	tax	benefit	of approximately	$29	million,	primarily	due	to	the	realization	of	tax	loss	carryforwards,	and benefits	from	certain	nonrecurring	items	and	excluded	the	$69	million	net	noncash benefit	and	the	$48	million	tax	benefit	related	to	the	Charitable	Contribution	mentioned above.

2012.	The	GAAP	effective	tax	rate	of	29.5%	for	2012	included	a	$21	million	benefit related	to	the	resolution	of	certain	outstanding	tax	positions	and	a	$50	million	net noncash	benefit	related	to	the	revaluation	of	certain	deferred	income	tax	liabilities, including	the	effect	of	tax	legislation	enacted	in	the	United	Kingdom	and	the	state	and local	income	tax	effect	resulting	from	changes	in	the	Company's	organizational structure.

The	as	adjusted	effective	tax	rate	of	31.0%	for	2012	excluded	the	$50	million	net noncash	tax	benefit	mentioned	above.

2011.	The	GAAP	effective	tax	rate	of	25.4%	for	2011	included	a	$24	million	benefit related	to	the	resolution	of	certain	outstanding	tax	positions	and	$198	million	of	net noncash	tax	benefits	due	to	a	state	tax	election	and	enacted	U.K.,	Japan,	U.S.	state and	local	tax	legislation.

The	2011	as	adjusted	effective	tax	rate	of	31.7%	included	the	$24	million	benefit	related to	the	revaluation	of	certain	deferred	income	tax	liabilities	and	excluded	the	$198	million net	noncash	benefit.

# BALANCE	SHEET	OVERVIEW

# As	Adjusted	Balance	Sheet

The	following	table	presents	a	reconciliation	of	the	consolidated	statement	of	financial condition	presented	on	a	GAAP	basis	to	the	consolidated	statement	of	financial condition,	excluding	the	impact	of	separate	account	assets	and	separate	account collateral	held	under	securities	lending	agreements	(directly	related	to	lending	separate account	securities)	and	separate	account	liabilities	and	separate	account	collateral liabilities	under	securities	lending	agreements,	consolidated	variable	interest	entities ("VIEs")	and	consolidated	sponsored	investment	funds.

The	Company	presents	the	as	adjusted	balance	sheet	as	additional	information	to enable	investors	to	exclude	certain	assets	that	have	equal	and	offsetting	liabilities	or noncontrolling	interests	that	ultimately	do	not	have	an	impact	on	stockholders'	equity (excluding	appropriated	retained	earnings	related	to	consolidated	collateralized	loan obligations	("CLOs"))	or	cash	flows.	Management	views	the	as	adjusted	balance	sheet, a	non-GAAP	financial	measure,

as	an	economic	presentation	of	its	total	assets	and	liabilities;	however,	it	does	not advocate	that	investors	consider	such	non-GAAP	financial	measures	in	isolation	from, or	as	a	substitute	for,	financial	information	prepared	in	accordance	with	GAAP.

# Separate	Account	Assets	and	Liabilities	and	Separate	Account	Collateral	Held	under Securities	Lending	Agreements

Separate	account	assets	are	maintained	by	BlackRock	Life	Limited,	a	wholly	owned subsidiary	of	the	Company,	which	is	a	registered	life	insurance	company	in	the	United Kingdom,	and	represent	segregated	assets	held	for	purposes	of	funding	individual	and group	pension	contracts.	The	Company	records	equal	and	offsetting	separate	account liabilities.	The	separate	account	assets	are	not	available	to	creditors	of	the	Company and	the	holders	of	the	pension	contracts	have	no	recourse	to	the	Company's	assets. The	net	investment	income	attributable	to	separate	account	assets	accrues	directly	to the	contract	owners	and	is	not	reported	on	the	consolidated	statements	of	income. While	BlackRock	has	no	economic	interest	in	these	assets	or	liabilities,	BlackRock earns	an	investment	advisory	fee	for	the	service	of	managing	these	assets	on	behalf	of the	clients.

In	addition,	the	Company	records	on	its	consolidated	statements	of	financial	condition the	separate	account	collateral	received	under	securities	lending	arrangements	as	its own	asset	in	addition	to	an	equal	and	offsetting	separate	account	collateral	liability	for the	obligation	to	return	the	collateral.

# Consolidated	VIEs

At	December	31,	2013,	BlackRock's	consolidated	VIEs	included	multiple	CLOs	and	one private	investment	fund.	The	assets	of	these	VIEs	are	not	available	to	creditors	of	the Company	and	the	Company	has	no	obligation	to	settle	the	liabilities	of	the	VIEs.	While BlackRock	has	no	material	economic	interest	in	these	assets	or	liabilities,	BlackRock earns	an	investment	advisory	fee,	as	well	as	a	potential	performance	fee,	for	the service	of	managing	these	assets	on	behalf	of	clients.

# Consolidated	Sponsored	Investment	Funds

The	Company	consolidates	certain	sponsored	investment	funds	primarily	because	it	is deemed	to	control	such	funds.	The	Company	may	not	be	readily	able	to	access	cash and	cash	equivalents	held	by	consolidated	sponsored	investment	funds	to	use	in	its operating	activities.	In	addition,	the	Company	may	not	be	readily	able	to	sell investments	held	by	consolidated	sponsored	investment	funds	in	order	to	obtain	cash for	use	in	the	Company's	operations.

|  |  | Separate |  | Consolidated |  |
| :--- | :--- | :--- | :--- | :--- | :--- |
|  |  | Account |  | Sponsored |  |
|  | GAAP | Assets/ | Consolidated | Investment | As |
| (in\tmillions) | Basis | Collateral | VIEs | Funds | Adjusted |
| Assets |  |  |  |  |  |
| Cash\tand\tcash\tequivalents | $4,390 | $— | $— | $114 | $4,276 |
| Accounts\treceivable | 2,247 | — | — | — | 2,247 |
| Investments | 2,151 | — | — | 94 | 2,057 |
| Assets\tof\tconsolidated\tVIEs | 2,486 | — | 2,486 | — | — |
| Separate\taccount\tassets\tand\tcollateral\theld\tunder\tsecurities\tlending\tagreements | 176,901 | 176,901 | — | — | — |
| Other\tassets(1) | 1,217 | — | — | 20 | 1,197 |
| Subtotal | 189,392 | 176,901 | 2,486 | 228 | 9,777 |
| Goodwill\tand\tintangible\tassets,\tnet | 30,481 | — | — | — | 30,481 |
| Total\tassets | $ 219,873 | $ 176,901 | $2,486 | $228 | $40,258 |
| Liabilities |  |  |  |  |  |
| Accrued\tcompensation\tand\tbenefits | $1,747 | $— | $— | $— | $1,747 |
| Accounts\tpayable\tand\taccrued\tliabilities | 1,084 | — | — | — | 1,084 |
| Borrowings | 4,939 | — | — | — | 4,939 |
| Liabilities\tof\tconsolidated\tVIEs | 2,443 | — | 2,443 | — | — |
| Separate\taccount\tliabilities\tand\tcollateral\tliabilities\tunder\tsecurities\tlending\tagreements | 176,901 | 176,901 | — | — | — |
| Deferred\tincome\ttax\tliabilities | 5,085 | — | — | — | 5,085 |
| Other\tliabilities | 1,004 | — | — | 39 | 965 |
| Total\tliabilities | 193,203 | 176,901 | 2,443 | 39 | 13,820 |
| Equity |  |  |  |  |  |
| Total\tstockholders'\tequity(2) | 26,460 | — | 22 | — | 26,438 |
| Noncontrolling\tinterests | 210 | — | 21 | 189 | — |
| Total\tequity | 26,670 | — | 43 | 189 | 26,438 |
| Total\tliabilities\tand\tequity | $\t219,873 | $\t176,901 | $\t2,486 | $\t228 | $\t40,258 |

(1) Amounts	include	property	and	equipment	and	other	assets.

(2) GAAP	amount	includes	$22	million	of	appropriated	retained	earnings	related	solely	to	consolidated	CLOs	in	which	the	Company	has	no	equity	exposure.

The	following	discussion	summarizes	the	significant	changes	in	assets	and	liabilities	on a	GAAP	basis.	The	discussion	does	not	include	changes	related	to	assets	and	liabilities that	are	equal	and	offsetting	and	have	no	impact	on	BlackRock's	stockholders'	equity.

Assets.	Cash	and	cash	equivalents	at	December	31,	2013	and	2012	included	$114 million	and	$133	million,	respectively,	of	cash	held	by	consolidated	sponsored investment	funds	(see	Liquidity	and	Capital	Resources	for	details	on	the	change	in	cash and	cash	equivalents	during	2013).

Investments	increased	$401	million	from	December	31,	2012	(for	more	information	see Investments	herein).	Goodwill	and	intangible	assets	increased	$169	million	from December	31,	2012,	primarily	due	to	the	MGPA	acquisition	and	Credit	Suisse	ETF Transaction,	partially	offset	by	$161	million	of	intangible	assets	amortization	expense. Other	assets	(including	property,	plant	and	equipment)	increased	$34	million	from December	31,	2012,	primarily	related	to	an	increase	in	strategic	investments	and	other receivables,	partially	offset	by	a	decrease	in	property	and	equipment	due	to depreciation	and	a	decrease	in	current	taxes	receivable.

Liabilities.	Accrued	compensation	and	benefits	at	December	31,	2013	increased	$200 million	from	December	31,	2012,	primarily	due	to	2013	incentive	compensation accruals.	Accounts	payable	and	accrued	liabilities	at	December	31,	2013	increased	$29 million	from	December	31,	2012	due	to	an	increase	in	current	income	taxes	payable and	increased	accruals,	including	direct	fund	expenses,	partially	offset	by	lower	unit trust	payables	(substantially	offset	by	a	decrease	in	unit	trust	receivables	recorded within	accounts	receivable).	Borrowings	decreased	$848	million	from	December	31, 2012	resulting	from	the	repayments	of	$750	million	and	$100	million	of	long-term	and short-term	borrowings,	respectively.

Net	deferred	income	tax	liabilities	at	December	31,	2013	decreased	$208	million, primarily	due	to	the	effects	of	temporary	differences	associated	with	stock compensation	and	investment	income.	The	change	also	reflects	the	revaluation	of certain	deferred	income	tax	liabilities	due	to	legislation	enacted	in	the	United	Kingdom, domestic	state	and	local	income	tax	changes,	and	realization	of	tax	loss	carryforwards. Other	liabilities	at	December	31,	2013	increased	$146	million	from	December	31,	2012, primarily	resulting	from	an	increase	in	liability	of	unrecognized	tax	benefits,	a contingent	liability	related	to	the	Credit	Suisse	ETF	Transaction	and	other	operating liabilities.

# Investments

Investments	totaled	$2,151	million	at	December	31,	2013	and	$1,750	million	at December	31,	2012.	Investments	include	consolidated	investments	held	by	sponsored investment	funds	deemed	to	be	controlled	by	BlackRock.	Management	reviews BlackRock's	investments	on	an	"economic"	basis,	which	eliminates	the	portion	of investments	that	does	not	impact	BlackRock's	book	value	or	net	income	attributable	to BlackRock.	BlackRock's	management	does	not	advocate	that	investors	consider	such non-GAAP	financial	measures	in	isolation	from,	or	as	a	substitute	for,	financial information	prepared	in	accordance	with	GAAP.

The	Company	further	presents	net	"economic"	investment	exposure,	net	of	deferred compensation	investments	and	hedged	investments,	to	reflect	another	gauge	for investors	as	the	economic	impact	of	investments	held	pursuant	to	deferred compensation	arrangements	is	substantially	offset	by	a	change	in	compensation expense	and	the	impact	of	hedged	investments	is	substantially	mitigated	by	swap hedges.	Carried	interest	capital	allocations	are	excluded	as	there	is	no	impact	to BlackRock's	stockholders'	equity	until	such	amounts	are	realized	as	performance	fees. Finally,	the	Company's	regulatory	investment	in	Federal	Reserve	Bank	stock,	which	is not	subject	to	market	or	interest	rate	risk,	is	excluded	from	the	Company's	net	economic investment	exposure.

The	Company	presents	total	investments,	as	adjusted,	to	enable	investors	to understand	the	portion	of	its	investments	that	is	owned	by	the	Company,	net	of	NCI,	as a	gauge	to	measure	the	impact	of	changes	in	net	nonoperating	gain	(loss)	on investments	to	net	income	(loss)	attributable	to	BlackRock.

|  | December	31, | December	31, |
| :--- | :--- | :--- |
| (in\tmillions) | 2013 | 2012 |
| Total\tinvestments,\tGAAP | $\t2,151 | $\t1,750 |
| Investments\theld\tby\tconsolidated\tsponsored\tinvestment\tfunds (1) | (826) | (524) |
| Net\texposure\tto\tconsolidated\tinvestment\tfunds | 732 | 430 |
| Total\tinvestments,\tas\tadjusted | 2,057 | 1,656 |
| Federal\tReserve\tBank\tstock | (90) | (89) |
| Carried\tinterest | (103) | (85) |
| Deferred\tcompensation\tinvestments | (97) | (62) |
| Hedged\tinvestments | (184) | (209) |
| Total\t"economic"\tinvestment\texposure | $1,583 | $1,211 |

(1) At	December	31,	2013	and	2012,	approximately	$826	million	and	$524	million,	respectively,	of	BlackRock's	total	GAAP	investments	were	held	in	sponsored	investment	funds	that	were	deemed	to	be	controlled	by BlackRock	in	accordance	with	GAAP,	and,	therefore,	are	consolidated	even	though	BlackRock	may	not	economically	own	a	majority	of	such	funds.

The	following	table	represents	the	carrying	value	of	the	Company's	economic	investment	exposure,	by	asset	type,	at	December	31,	2013	and	2012:

(1) Other	investments	primarily	include	seed	investments	in	fixed	income	and	equity	funds/strategies	as	well	as	U.K.	government	securities	held	for	regulatory	purposes.

As	adjusted	investment	activity	for	2013	was	as	follows:

The	following	table	represents	investments,	as	adjusted	at	December	31,	2013:

| Quoted |  |  |  |  |
| :--- | :--- | :--- | :--- | :--- |
| Prices\tin |  |  |  |  |
| Active\nMarkets\tfor\nIdentical\nAssets\n(Level\t1) | Significant\nOther\nObservable\nInputs\n(Level\t2) | Significant\nUnobservable\nInputs\n(Level\t3) | Other\nInvestments\tNot\nHeld\tat\tFair\nValue(1) | Investments\tat\nDecember\t31,\n2013 |
| $\t607 | $\t545 | $\t489 | $\t416 | $\t2,057 |

(1) Amount	includes	investments	held	at	cost	or	amortized	cost,	carried	interest	and	certain	equity	method	investments,	which	include	sponsored	investment	funds,	which	are	not	accounted	for	under	a	fair	value	measure. Certain	equity	method	investees	do	not	account	for	both	their	financial	assets	and	financial	liabilities	under	fair	value	measures,	therefore,	the	Company's	investment	in	such	equity	method	investees	may	not	represent fair	value.

(2) Amounts	include	cash	and	cash	equivalents,	other	assets	and	liabilities	that	are	consolidated	from	non-VIE	sponsored	investment	funds.	See	Note	5, Fair	Value	Disclosures,	to	the	consolidated	financial	statements contained	in	Part	II,	Item	8	of	this	filing,	for	total	GAAP	investments.

# LIQUIDITY	AND	CAPITAL	RESOURCES

# BlackRock	Cash	Flows	Excluding	the	Impact	of	Consolidated	Sponsored Investment	Funds	and	VIEs

BlackRock	consolidates	certain	of	its	sponsored	investment	funds	and	CLOs, notwithstanding	the	fact	BlackRock	may	only	have	a	minority	interest,	if	any,	in	these funds	or	CLOs.	As	a	result,	the	consolidated	statements	of	cash	flows	include	the	cash flows	of	consolidated	sponsored	investment	funds	and	CLOs.	The	Company	uses	an adjusted	cash	flow	statement,	which	excludes	the	impact	of

consolidated	sponsored	investment	funds	and	CLOs,	as	a	supplemental	non-GAAP measure	to	assess	liquidity	and	capital	requirements.	The	Company	believes	that	its cash	flows,	excluding	the	impact	of	the	consolidated	sponsored	investment	funds	and CLOs,	provide	investors	with	useful	information	on	the	cash	flows	of	BlackRock	relating to	its	ability	to	fund	additional	operating,	investing	and	financing	activities.	BlackRock's management	does	not	advocate	that	investors	consider	such	non-GAAP	measures	in isolation	from,	or	as	a	substitute	for,	its	cash	flows	presented	in	accordance	with	GAAP.

The	following	table	presents	a	reconciliation	of	the	consolidated	statements	of	cash	flows	presented	on	a	GAAP	basis	to	the	consolidated	statements	of	cash	flows,	excluding	the impact	of	the	cash	flows	of	consolidated	sponsored	investment	funds	and	consolidated	VIEs:

|  |  | Impact	on |  | Excluding |
| :--- | :--- | :--- | :--- | :--- |
|  |  | Cash\tFlows | Impact\ton | Impact\tof |
|  |  | of\tConsolidated | Cash\tFlows | Consolidated |
|  |  | Sponsored | of | Sponsored |
|  | GAAP | Investment | Consolidated | Investment |
| (in\tmillions) | Basis | Funds | VIEs | Funds\tand\tVIEs |
| Cash\tand\tcash\tequivalents,\tDecember\t31,\t2011 | $\t3,506 | $196 | $— | $3,310 |
| Cash\tflows\tfrom\toperating\tactivities | 2,240 | \t(256) | (227) | 2,723 |
| Cash\tflows\tfrom\tinvesting\tactivities | (266) | (211) | — | (55) |
| Cash\tflows\tfrom\tfinancing\tactivities | (944) | 404 | 227 | (1,575) |
| Effect\tof\texchange\trate\tchanges\ton\tcash\tand\tcash\tequivalents | 70 | — | — | 70 |
| Net\tchange\tin\tcash\tand\tcash\tequivalents | 1,100 | (63) | — | 1,163 |
| Cash\tand\tcash\tequivalents,\tDecember\t31,\t2012 | 4,606 | 133 | — | 4,473 |
| Cash\tflows\tfrom\toperating\tactivities | 3,642 | (137) | 286 | 3,493 |
| Cash\tflows\tfrom\tinvesting\tactivities | (483) | 39 | — | (522) |
| Cash\tflows\tfrom\tfinancing\tactivities | (3,392) | 79 | \t(286) | \t(3,185) |
| Effect\tof\texchange\trate\tchanges\ton\tcash\tand\tcash\tequivalents | 17 | — | — | 17 |
| Net\tchange\tin\tcash\tand\tcash\tequivalents | (216) | (19) | — | (197) |
| Cash\tand\tcash\tequivalents,\tDecember\t31,\t2013 | $ 4,390 | $114 | $— | $4,276 |

Sources	of	BlackRock's	operating	cash	primarily	include	investment	advisory, administration	fees	and	securities	lending	revenue,	performance	fees,	revenue	from BlackRock	Solutions	and	advisory	products	and	services,	other	revenue	and	distribution fees.	BlackRock	uses	its	cash	to	pay	all	operating	expenses,	interest	and	principal	on the	Company's	borrowings,	income	taxes,	dividends	on	BlackRock's	capital	stock, repurchases	of	the	Company's	stock,	capital	expenditures	and	purchases	of	co- investments	and	seed	investments.

Cash	flows	from	operating	activities,	excluding	the	impact	of	consolidated	sponsored investment	funds	and	VIEs,	primarily	include	the	receipt	of	investment	advisory	and administration	fees,	securities	lending	revenue	and	other	revenue	offset	by	the	payment of	operating	expenses	incurred	in	the	normal	course	of	business,	including	year-end incentive	compensation	accrued	for	in	the	prior	year.

Cash	outflows	from	investing	activities,	excluding	the	impact	of	consolidated	sponsored investment	funds	and	VIEs,	for	2013	were	$522	million	and	primarily	reflected $555	million

of	investment	purchases	and	$298	million	related	to	the	Credit	Suisse	ETF	Transaction and	the	MGPA	acquisition,	partially	offset	by	$342	million	of	net	proceeds	from	sales and	maturities	of	certain	investments.

Cash	outflows	from	financing	activities,	excluding	the	impact	of	consolidated	sponsored investment	funds	and	VIEs,	for	2013	were	$3.2	billion,	primarily	resulting	from	$1.2 billion	of	share	repurchases,	including	$1.0	billion	in	open	market	transactions	and	$243 million	of	employee	tax	withholdings	related	to	employee	stock	transactions,	$1.2	billion of	cash	dividend	payments,	a	$750	million	long-term	debt	repayment	and	a	$100	million short-term	debt	repayment.	Cash	outflows	from	financing	activities	were	partially	offset by	cash	inflows	related	to	$41	million	of	excess	tax	benefits	from	stock-based compensation.

The	Company	manages	its	financial	condition	and	funding	to	maintain	appropriate liquidity	for	the	business.	Liquidity	resources	at	December	31,	2013	and	2012	were	as follows:

|  | December	31, | December	31, |
| :--- | :--- | :--- |
| (in\tmillions) | 2013 | 2012 |
| Cash\tand\tcash\tequivalents | $4,390 | $4,606 |
| Cash\tand\tcash\tequivalents\theld\tby |  |  |
| consolidated\tsponsored\tinvestment |  |  |
| funds(1) | (114) | (133) |
| Subtotal | 4,276 | 4,473 |
| Credit\tfacility\t—\tundrawn | 3,990 | 3,685 |
| Total\tliquidity | $\t8,266 | $\t8,158 |

(1) The	Company	may	not	be	able	to	access	such	cash	to	use	in	its	operating	activities.

Total	liquidity	increased	$108	million	during	2013,	primarily	reflecting	positive	operating cash	flow	and	the	increased	aggregate	commitment	of	the	2013	credit	facility	to $3.990	billion,	partially	offset	by	the	$750	million	repayment	of	long-term	borrowings, cash	payments	of	2012	year-end	incentive	awards,	share	repurchases,	including	$1.0 billion	in	open	market	transactions,	and	cash	dividend	payments.

A	significant	portion	of	the	Company's	$2,057	million	of	total	investments,	as	adjusted, is	illiquid	in	nature	and,	as	such,	may	not	be	readily	convertible	to	cash.

Share	Repurchase	Approvals.	In	January	2013,	the	Board	of	Directors	(the	"Board") approved	an	increase	in	the	availability	under	the	Company's	existing	share	repurchase program	to	allow	for	the	repurchase	of	up	to	10.2	million	shares	of	BlackRock	common stock.	The	Company	repurchased	3.7	million	common	shares	in	open	market- transactions	under	the	share	repurchase	program	for	$1.0	billion	during	2013.	At December	31,	2013,	there	were	6.5	million	shares	still	authorized	to	be	repurchased.

Net	Capital	Requirements.	The	Company	is	required	to	maintain	net	capital	in	certain regulated	subsidiaries	within	a	number	of	jurisdictions,	which	is	partially	maintained	by retaining	cash	and	cash	equivalent	investments	in	those	subsidiaries	or	jurisdictions.	As a	result,	such	subsidiaries	of	the	Company	may	be	restricted	in	their	ability	to	transfer cash	between	different	jurisdictions	and	to	their	parents.	Additionally,	transfers	of	cash between	international	jurisdictions,	including	repatriation	to	the	United	States,	may	have adverse	tax	consequences	that	could	discourage	such	transfers.

BlackRock	Institutional	Trust	Company,	N.A.	("BTC")	is	chartered	as	a	national	bank that	does	not	accept	client	deposits	and	whose	powers	are	limited	to	trust	activities. BTC	provides	investment	management	services,	including	investment	advisory	and securities	lending	agency	services,	to	institutional	investors	and	other	clients.	BTC	is subject	to	regulatory	capital	and	liquid	asset	requirements	administered	by	the	Office	of the	Comptroller	of	the	Currency.

At	December	31,	2013,	the	Company	was	required	to	maintain	approximately	$1.1 billion	compared	with	$1.2	billion	at	December	31,	2012	in	net	capital	in	certain regulated	subsidiaries,	including	BTC,	entities	regulated	by	the	Financial	Conduct Authority	and	Prudential	Regulation	Authority	in	the	United	Kingdom	and	the Company's	broker-dealers.	The	Company	was	in	compliance	with	all	applicable regulatory	net	capital	requirements.	The	decrease	in	required	net	capital	was	primarily due	to	a	reduction	in	the	BTC	minimum	Tier	1	capital	requirement	from	$500	million	to $385	million	in	August	2013.

# Undistributed	Earnings	of	Foreign	Subsidiaries.	As	of	December	31,	2013,	the

Company	has	not	provided	for	U.S.	federal	and	state	income	taxes	on	approximately $3.1	billion	of	undistributed	earnings	of	its	foreign	subsidiaries.	Such	earnings	are considered	indefinitely	reinvested	outside	the	United	States.	The	Company's	current plans	do	not	demonstrate	a	need	to	repatriate	these	funds.

# Short-Term	Borrowings

2013	Revolving	Credit	Facility.	In	March	2011,	the	Company	entered	into	a	five-year $3.5	billion	unsecured	revolving	credit	facility	(the	"2011	credit	facility").	In	March	2012, the	2011	credit	facility	was	amended	to	extend	the	maturity	date	by	one	year	to	March 2017	and	in	April	2012	the	amount	of	the	aggregate	commitment	was	increased	to $3.785	billion	(the	"2012	credit	facility").	In	March	2013,	the	Company's	credit	facility was	amended	to	extend	the	maturity	date	by	one	year	to	March	2018	and	the	amount	of the	aggregate	commitment	was	increased	to	$3.990	billion	(the	"2013	credit	facility"). The	2013	credit	facility	permits	the	Company	to	request	up	to	an	additional	$1.0	billion of	borrowing	capacity,	subject	to	lender	credit	approval,	increasing	the	overall	size	of the	2013	credit	facility	to	an	aggregate	principal	amount	not	to	exceed	$4.990	billion. Interest	on	borrowings	outstanding	accrues	at	a	rate	based	on	the	applicable	London Interbank	Offered	Rate	plus	a	spread.	The	2013	credit	facility	requires	the	Company	not to	exceed	a	maximum	leverage	ratio	(ratio	of	net	debt	to	earnings	before	interest,	taxes, depreciation	and	amortization,	where	net	debt	equals	total	debt	less	unrestricted	cash) of	3	to	1,	which	was	satisfied	with	a	ratio	of	less	than	1	to	1	at	December	31,	2013.	The 2013	credit	facility	provides	back-up	liquidity,	funds	ongoing	working	capital	for	general corporate	purposes	and	funds	various	investment	opportunities.	At	December	31,	2013, the	Company	had	no	amount	outstanding	under	the	2013	credit	facility.

Commercial	Paper	Program.	On	October	14,	2009,	BlackRock	established	a commercial	paper	program	(the	"CP	Program")	under	which	the	Company	could	issue unsecured	commercial	paper	notes	(the	"CP	Notes")	on	a	private	placement	basis	up	to a	maximum	aggregate	amount	outstanding	at	any	time	of	$3.0	billion.	On	May	13, 2011,	BlackRock	increased	the	maximum	aggregate	amount	that	may	be	borrowed under	the	CP	Program	to	$3.5	billion.	On

May	17,	2012,	BlackRock	increased	the	maximum	aggregate	amount	to	$3.785	billion. In	April	2013,	BlackRock	increased	the	maximum	aggregate	amount	for	which	the Company	could	issue	unsecured	CP	Notes	on	a	private-placement	basis	up	to	a maximum	aggregate	amount	outstanding	at	any	time	of	$3.990	billion.	The	commercial paper	program	is	currently	supported	by	the	2013	credit	facility.	At	December	31,	2013, BlackRock	had	no	CP	Notes	outstanding.

# Long-term	Borrowings.

At	December	31,	2013,	the	principal	amount	of	long-term	borrowings,	including	the current	portion,	was	$4.95	billion.

2015	and	2022	Notes.	In	May	2012,	the	Company	issued	$1.5	billion	in	aggregate principal	amount	of	unsecured	unsubordinated	obligations.	These	notes	were	issued	as two	separate	series	of	senior	debt	securities,	including	$750	million	of	1.375%	notes maturing	in	June	2015	(the	"2015	Notes")	and	$750	million	of	3.375%	notes	maturing	in June	2022	(the	"2022	Notes").	Net	proceeds	were	used	to	fund	the	repurchase	of BlackRock's	common	stock	and	Series	B	Preferred	from	Barclays	and	affiliates	and	for general	corporate	purposes.	Interest	on	the	2015	Notes	and	2022	Notes	of approximately	$10	million	and	$25	million	per	year,	respectively,	is	payable	semi- annually	on	June	1	and	December	1	of	each	year,	which	commenced	December	1, 2012.	The	2015	Notes	and	2022	Notes	may	be	redeemed	prior	to	maturity	at	any	time in	whole	or	in	part	at	the	option	of	the	Company	at	a	"make-whole"	redemption	price. The	"make-whole"	redemption	price	represents	a	price,	subject	to	the	specific	terms	of the	2015	and	2022	Notes	and	related	indenture,	that	is	the	greater	of	(a)	par	value	and (b)	the	present	value	of	future	payments	that	will	not	be	paid	because	of	an	early redemption,	which	is	discounted	at	a	fixed	spread	over	a	comparable	Treasury	security.

2013	and	2021	Notes.	In	May	2011,	the	Company	issued	$1.5	billion	in	aggregate principal	amount	of	unsecured	unsubordinated	obligations.	These	notes	were	issued	as two	separate	series	of	senior	debt	securities,	including	$750	million	of	4.25%	notes maturing	in	May	2021	and	$750	million	of	floating	rate	notes	("2013	Floating	Rate Notes"),	which	were	repaid	in	May	2013.	Net	proceeds	of	this

offering	were	used	to	fund	the	repurchase	of	BlackRock's	Series	B	Preferred	from affiliates	of	Merrill	Lynch.	Interest	on	the	4.25%	notes	due	in	2021	("2021	Notes")	is payable	semi-annually	on	May	24	and	November	24	of	each	year,	which	commenced November	24,	2011,	and	is	approximately	$32	million	per	year.	The	2021	Notes	may	be redeemed	prior	to	maturity	at	any	time	in	whole	or	in	part	at	the	option	of	the	Company at	a	"make-whole"	redemption	price.

In	May	2011,	in	conjunction	with	the	issuance	of	the	2013	Floating	Rate	Notes,	the Company	entered	into	a	$750	million	notional	interest	rate	swap	maturing	in	2013	to hedge	the	future	cash	flows	of	its	obligation	at	a	fixed	rate	of	1.03%.	During	the	second quarter	of	2013,	the	interest	rate	swap	matured	and	the	2013	Floating	Rate	Notes	were fully	repaid.

2012,	2014	and	2019	Notes.	In	December	2009,	the	Company	issued	$2.5	billion	in aggregate	principal	amount	of	unsecured	and	unsubordinated	obligations.	These	notes were	issued	as	three	separate	series	of	senior	debt	securities,	including	$0.5	billion	of 2.25%	notes,	which	were	repaid	in	December	2012,	$1.0	billion	of	3.50%	notes	and $1.0	billion	of	5.0%	notes	maturing	in	December	2014	and	2019,	respectively.	Net proceeds	of	this	offering	were	used	to	repay	borrowings	under	the	CP	program,	which was	used	to	finance	a	portion	of	the	BGI	Transaction,	and	for	general	corporate purposes.	These	notes	may	be	redeemed	prior	to	maturity	at	any	time	in	whole	or	in part	at	the	option	of	the	Company	at	a	"make-whole"	redemption	price.	Interest	on	the 2014	Notes	and	2019	Notes	of	approximately	$35	million	and	$50	million	per	year, respectively,	is	payable	semi-annually	in	arrears	on	June	10	and	December	10	of	each year.

2017	Notes.	In	September	2007,	the	Company	issued	$700	million	in	aggregate principal	amount	of	6.25%	senior	unsecured	and	unsubordinated	notes	maturing	on September	15,	2017	(the	"2017	Notes").	A	portion	of	the	net	proceeds	of	the	2017	Notes was	used	to	fund	the	initial	cash	payment	for	the	acquisition	of	the	fund	of	funds business	of	Quellos	Group,	LLC	in	October	2007	(the	"Quellos	Transaction")	and	the remainder	was	used	for	general	corporate	purposes.	Interest	is	payable	semi-annually in	arrears	on	March	15	and	September	15	of	each	year,	or	approximately	$44	million per	year.	The	2017	Notes	may	be	redeemed	prior	to	maturity	at	any	time	in	whole	or	in part	at	the	option	of	the	Company	at	a	"make-whole"	redemption	price.

# Contractual	Obligations,	Commitments	and	Contingencies

The	following	table	sets	forth	contractual	obligations,	commitments	and	contingencies	by	year	of	payment	at	December	31,	2013:

| (in	millions) | 2014 | 2015 | 2016 | 2017 | 2018 | Thereafter | Total |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| Contractual\tobligations\tand\tcommitments: |  |  |  |  |  |  |  |
| Long-term\tborrowings(1): |  |  |  |  |  |  |  |
| Principal | $\t1,000 | $\t750 | $— | $\t700 | $— | $\t2,500 | $\t4,950 |
| Interest | 196 | 156 | \t151 | 151 | \t107 | 218 | 979 |
| Operating\tleases | \t135 | \t127 | \t110 | \t109 | \t106 | \t699 | \t1,286 |
| Purchase\tobligations | 83 | 77 | 31 | 8 | — | — | 199 |
| Investment\tcommitments | 216 | — | — | — | — | — | 216 |
| Total\tcontractual\tobligations\tand\tcommitments | 1,630 | \t1,110 | \t292 | \t968 | \t213 | \t3,417 | \t7,630 |
| Contingent\tobligations: |  |  |  |  |  |  |  |
| Contingent\tdistribution\tobligations | 172 | 172 | 172 | — | — | — | 516 |
| Contingent\tpayments\trelated\tto\tbusiness\tacquisitions(2) | 4 | 5 | 11 | 8 | 23 | 24 | 75 |
| Total\tcontractual\tobligations,\tcommitments\tand\tcontingent\tobligations (3) | $\t1,806 | $1,287 | $475 | $976 | $236 | $3,441 | $8,221 |

(1) Long-term	borrowings	exclude	the	borrowings	of	consolidated	CLOs.	The	Company	has	no	obligation to	settle	the	liabilities	of	these	CLOs.

(2) The	amount	of	contingent	payments	reflected	for	any	year	represents	the	expected	payment	amounts, using	foreign	currency	exchange	rates	as	of	December	31,	2013,	under	the	terms	of	the	business acquisition's	agreement.	The	maximum	potential	payment	amount	related	to	Credit	Suisse	ETF Transaction	is	approximately	$24	million	for	any	year	during	a	seven	year	period.	There	is	no maximum	amount	for	payments	related	to	the	MGPA	Transaction.	The	fair	value	of	the	contingent obligations	is	not	significant	to	the	consolidated	statement	of	financial	condition	and	is	recorded	within other	liabilities.

(3) At	December	31,	2013,	the	Company	had	$372	million	of	net	unrecognized	tax	benefits.	Due	to	the uncertainty	of	timing	and	amounts	that	will	ultimately	be	paid,	this	amount	has	been	excluded	from	the table	above.

Operating	Leases.	The	Company	leases	its	primary	office	locations	under	agreements that	expire	on	varying	dates	through	2035.	In	connection	with	certain	lease	agreements, the	Company	is	responsible	for	escalation	payments.	The	contractual	obligations	table above	includes	only	guaranteed	minimum	lease	payments	for	such	leases	and	does	not project	potential	escalation	or	other	lease-related	payments.	These	leases	are classified	as	operating	leases	and,	as	such,	are	not	recorded	as	liabilities	on	the consolidated	statements	of	financial	condition.

Purchase	Obligations.	In	the	ordinary	course	of	business,	BlackRock	enters	into contracts	or	purchase	obligations	with	third	parties	whereby	the	third	parties	provide services	to	or	on	behalf	of	BlackRock.	Purchase	obligations	included	in	the	contractual obligations	table	above	represent	executory	contracts,	which	are	either	noncancelable or	cancelable	with	a	penalty.	At	December	31,	2013,	the	Company's	obligations primarily	reflected	standard	service	contracts	for	portfolio,	market	data,	office-related services	and	third-party	marketing	and	promotional	services.	Purchase	obligations	are recorded	on	the	Company's	financial	statements	when	services	are	provided	and,	as such,	obligations	for	services	not	received	are	not	included	in	the	consolidated statement	of	financial	condition	at	December	31,	2013.

Investment	Commitments.	At	December	31,	2013,	the	Company	had	$216	million	of various	capital	commitments	to	fund	sponsored	investment	funds,	including	funds	of private	equity	funds,	real	estate	funds,	infrastructure	funds,	opportunistic	funds	and distressed	credit	funds.	This	amount	excludes	additional	commitments	made	by consolidated	funds	of	funds	to	underlying	third-party	funds	as	third-party	noncontrolling interest	holders	have	the	legal	obligation	to	fund	the	respective	commitments	of	such funds	of	funds.	Generally,	the	timing	of	the	funding	of	these	commitments	is	unknown and	the	commitments	are	callable	on	demand	at	any	time	prior	to	the	expiration	of	the commitment.	These	unfunded	commitments	are	not	recorded	on	the	consolidated statements	of	financial	condition.	These	commitments	do	not	include	potential	future commitments	approved	by	the	Company,	but	which	are	not	yet	legally	binding.	The Company	intends	to	make	additional	capital	commitments	from	time	to	time	to	fund additional	investment	products	for,	and	with,	its	clients.

Carried	Interest	Clawback.	As	a	general	partner	in	certain	investment	funds,	including private	equity	partnerships	and	certain	hedge	funds,	the	Company	may	receive	carried interest	cash	distributions	from	the	partnerships	in	accordance	with	distribution provisions	of	the	partnership	agreements.	The	Company	may,	from	time	to	time,	be required	to	return	all	or	a	portion	of	such	distributions	to	the

limited	partners	in	the	event	the	limited	partners	do	not	achieve	a	return	as	specified	in the	various	partnership	agreements.	Therefore,	BlackRock	records	carried	interest subject	to	such	clawback	provisions	in	investments,	or	cash	to	the	extent	that	it	is distributed,	and	as	a	deferred	carried	interest	liability	on	its	consolidated	statements	of financial	condition.	Carried	interest	is	realized	and	recorded	as	performance	fees	on BlackRock's	consolidated	statements	of	income	upon	the	earlier	of	the	termination	of the	investment	fund	or	when	the	likelihood	of	clawback	is	mathematically	improbable.

Contingent	Payments	Related	to	Business	Acquisitions.	In	connection	with	the	Credit Suisse	ETF	Transaction,	BlackRock	is	required	to	make	contingent	payments	annually to	Credit	Suisse,	subject	to	achieving	specified	thresholds	during	a	seven	year	period, subsequent	to	the	acquisition	date.	In	addition,	BlackRock	is	required	to	make contingent	payments	related	to	the	MGPA	Transaction	during	a	five	year	period,	subject to	achieving	specified	thresholds,	subsequent	to	the	acquisition	date.	The	fair	value	of the	contingent	payments	at	December	31,	2013	is	not	significant	to	the	consolidated statement	of	financial	condition	and	is	included	in	other	liabilities.

Indemnifications.	In	many	of	the	Company's	contracts,	including	the	BGI,	Merrill	Lynch Investment	Managers	("MLIM")	and	Quellos	Transaction	agreements,	BlackRock agrees	to	indemnify	third	parties	under	certain	circumstances.	The	terms	of	the indemnities	vary	from	contract	to	contract	and	the	amount	of	indemnification	liability,	if any,	cannot	be	determined	and,	therefore,	has	not	been	included	in	the	table	above	or recorded	in	the	consolidated	statement	of	financial	condition	at	December	31,	2013. See	further	discussion	in	Note	13,	Commitments	and	Contingencies,	to	the consolidated	financial	statements	beginning	on	page	F-1	of	this	Form	10-K.

On	behalf	of	certain	clients,	the	Company	lends	securities	to	highly	rated	banks	and broker-dealers.	In	these	securities	lending	transactions,	the	borrower	is	required	to provide	and	maintain	collateral	at	or	above	regulatory	minimums.	Securities	on	loan	are marked	to	market	daily	to	determine	if	the	borrower	is	required	to	pledge	additional collateral.	BlackRock	has	issued	certain	indemnifications	to	certain	securities	lending clients	against	potential	losses	resulting	from	a	borrower's	failure	to	fulfill	its	obligations should	the	value	of	the	collateral	pledged	by	the	borrower	at	the	time	of	default	be insufficient	to	cover	the	borrower's	obligations	under	the	securities	lending	agreement. At	December	31,	2013,	the	Company	indemnified	certain	of	its	clients	for	their	securities lending	loan	balances	of	approximately	$118.3	billion.	The	Company	held,	as	agent, cash	and	securities	totaling	$124.6	billion	as	collateral	for	indemnified	securities	on	loan at	December	31,	2013.	The	fair	value	of	these	indemnifications	was	not	material	at December	31,	2013.	The	Company	currently	expects	indemnified	balances	to	continue to	increase	over	time.

While	the	collateral	pledged	by	a	borrower	is	intended	to	be	sufficient	to	offset	the borrower's	obligations	to	return	securities	borrowed	and	any	other	amounts	owing	to	the lender	under	the	relevant	securities	lending	agreement,	in	the	event	of	a	borrower default,	the	Company	can	give	no	assurance	that	the	collateral	pledged	by	the	borrower will	be	sufficient	to	fulfill	such	obligations.	If	the	amount	of	such	pledged	collateral	is	not sufficient	to	fulfill	such	obligations

to	a	client	for	whom	the	Company	has	provided	indemnification,	BlackRock	would	be responsible	for	the	amount	of	the	shortfall.	These	indemnifications	cover	only	the collateral	shortfall	described	above,	and	do	not	in	any	way	guarantee,	assume	or otherwise	insure	the	investment	performance	or	return	of	any	cash	collateral	vehicle into	which	securities	lending	cash	collateral	is	invested.

Contingent	Distribution	Obligations.	In	November	2010,	BlackRock	entered	into	a second	amended	and	restated	global	distribution	agreement	with	Merrill	Lynch,	which requires	the	Company	to	make	payments	to	Merrill	Lynch	contingent	upon	sales	of products	and	level	of	AUM	maintained	in	certain	BlackRock	products.	The	initial	term	of the	agreement	remained	in	effect	until	January	2014.	After	such	term,	the	agreement renewed	for	one	automatic	three-year	extension.

The	following	items	have	not	been	included	in	the	contractual	obligations,	commitments and	contingencies	table:

Compensation	and	Benefit	Obligations.	The	Company	has	various	compensation	and benefit	obligations,	including	bonuses,	commissions	and	incentive	payments	payable, defined	contribution	plan	matching	contribution	obligations,	and	deferred	compensation arrangements,	that	are	excluded	from	the	contractual	obligations	and	commitments table	above.	These	arrangements	are	discussed	in	more	detail	in	Note	14,	Stock-Based Compensation,	and	Note	15,	Employee	Benefit	Plans,	to	the	consolidated	financial statements	beginning	on	page	F-1	of	this	Form	10-K.	Accrued	compensation	and benefits	at	December	31,	2013	totaled	$1,747	million	and	included	incentive compensation	of	$1,335	million,	deferred	compensation	of	$164	million	and	other compensation	and	benefits	related	obligations	of	$248	million.	Substantially	all	of	the incentive	compensation	liability	was	paid	in	the	first	quarter	of	2014,	while	the	deferred compensation	obligations	are	generally	payable	over	periods	up	to	five	years.

Separate	Account	Liabilities.	At	December	31,	2013,	the	Company	had	$155.1	billion	of separate	account	assets	and	offsetting	liabilities	on	the	consolidated	statement	of financial	condition.	The	timing	of	payments	of	these	contractual	obligations	is	inherently uncertain	and	varies	by	customer.	As	such,	these	liabilities	have	been	excluded	from the	contractual	obligations	table	above.

# Critical	Accounting	Policies

The	preparation	of	consolidated	financial	statements	in	conformity	with	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 consolidated	financial	statements	and	the	reported	amounts	of	revenues	and	expenses during	the	reporting	periods.	Actual	results	could	differ	significantly	from	those estimates.	Management	considers	the	following	critical	accounting	policies	important	to understanding	the	consolidated	financial	statements.	For	a	summary	of	these	and additional	accounting	policies	see	Note	2,	Significant	Accounting	Policies,	to	the consolidated	financial	statements	beginning	on	page	F-1	of	this	Form	10-K.

# Consolidation	of	Sponsored	Investment	Funds	and	Securitization	Products.

Consolidation	of	sponsored	investment	funds	and	securitization	products	(collectively "investment	products")	is	determined	pursuant	to	ASC	810,	Consolidation.	The accounting	method	used	by	the	Company	depends	upon	the	influence	the	Company has	over	its	investee,	the	investment	product.	To	the	extent	that	BlackRock	can	exert control	over	the	financial	and	operating	policies	of	the	investment	product,	which generally	exists	if	there	is	a	50%	or	greater	voting	interest	or	if	partners	or	members	of certain	products	do	not	have	substantive	rights,	BlackRock	consolidates	the	investment product.

For	investment	products	in	which	BlackRock's	voting	interest	is	less	than	50%,	an analysis	is	performed	to	determine	if	the	investment	product	is	a	VIE	or	a	voting	rights entity.

Consolidation	of	Variable	Interest	Entities.	Certain	investment	products	for	which	the risks	and	rewards	of	ownership	are	not	directly	linked	to	voting	interests	may	be deemed	VIEs.	BlackRock	reviews	factors,	including	the	rights	of	the	equity	holders	and obligations	of	equity	holders	to	absorb	losses	or	receive	expected	residual	returns,	to determine	if	the	investment	product	is	a	VIE.	BlackRock	continuously	evaluates	such factors	as	facts	and	circumstances	change.	BlackRock	is	required	to	consolidate	a	VIE when	it	is	deemed	to	be	the	primary	beneficiary	("PB").

Accounting	Standards	Update	("ASU")	2010-10,	Amendments	to	Statement	167	for Certain	Investment	Funds	("ASU	2010-10")	defers	the	application	of	Statement	of Financial	Accounting	Standards	("SFAS")	No.	167,	Amendments	to	FASB	Interpretation No.	46(R),	for	certain	investment	funds,	including	money	market	funds.	The	PB	of	a	VIE that	is	an	investment	fund	that	meets	the	conditions	of	ASU	2010-10	is	the	enterprise that	has	a	variable	interest	(or	combination	of	variable	interests,	including	those	of related	parties)	that	absorbs	the	majority	of	the	entity's	expected	losses,	receives	a majority	of	the	entity's	expected	residual

returns,	or	both.	The	PB	of	a	VIE	that	does	not	meet	the	conditions	for	deferral	in	ASU 2010-10	is	the	enterprise	that	has	the	power	to	direct	activities	of	the	entity	that	most significantly	impact	the	entity's	economic	performance	and	has	the	obligation	to	absorb losses	or	the	right	to	receive	benefits	that	potentially	could	be	significant	to	the	VIE.

Significant	judgment	is	required	in	the	determination	of	whether	the	Company	is	the	PB of	a	VIE.	If	the	Company	is	determined	to	be	the	PB	of	a	VIE,	BlackRock	will consolidate	the	entity.	In	order	to	determine	whether	the	Company	is	the	PB	of	a	VIE	for entities	that	meet	the	conditions	of	ASU	2010-10,	management	must	make	significant estimates	and	assumptions	of	projected	future	cash	flows.	Assumptions	made	in	such analyses	include,	but	are	not	limited	to,	market	prices	of	securities,	market	interest rates,	potential	credit	defaults	on	individual	securities	or	default	rates	on	a	portfolio	of securities,	prepayments,	realization	of	gains,	liquidity	or	marketability	of	certain securities,	discount	rates	and	the	probability	of	certain	other	outcomes.

In	the	normal	course	of	business,	the	Company	is	the	manager	of	various	types	of sponsored	investment	vehicles,	including	collateralized	debt	obligations	("CDOs")	or CLOs	that	do	not	meet	the	conditions	of	ASU	2010-10	and	sponsored	investment	funds, which	may	be	considered	VIEs.

At	December	31,	2013,	the	following	balances	related	to	VIEs	were	included	on	the	consolidated	statements	of	financial	condition:

|  |  | Sponsored | Total |
| :--- | :--- | :--- | :--- |
|  |  | Private | Consolidated |
| (in\tmillions) | CLOs | Equity\tFund | VIEs |
| Assets\tof\tconsolidated\tVIEs: |  |  |  |
| Cash\tand\tcash\tequivalents | $156 | $5 | $161 |
| Bank\tloans,\tbonds,\tother\tinvestments\tand\tother\tassets | \t\t2,309 | \t\t16 | \t\t2,325 |
| Liabilities\tof\tconsolidated\tVIEs: |  |  |  |
| Borrowings | (2,369) | — | (2,369) |
| Other\tliabilities | (74) | — | (74) |
| Appropriated\tretained\tearnings | (22) | — | (22) |
| Noncontrolling\tinterests\tof\tconsolidated\tVIEs | — | (21) | (21) |
| Total\tBlackRock\tnet\tinterests\tin\tconsolidated\tVIEs | $— | $— | $— |

CLOs.	At	December	31,	2013,	BlackRock	was	the	manager	of	over	20	CLOs/CDOs	and other	securitization	entities.	BlackRock	was	determined	to	be	the	PB	for	certain	of	these CLOs,	which	required	BlackRock	to	consolidate	these	VIEs.	BlackRock	was	deemed	to be	the	PB	because	it	has	the	power	to	direct	the	activities	of	the	CLOs	that	most significantly	impact	the	entities'	economic	performance	and	has	the	right	to	receive benefits	that	potentially	could	be	significant	to	the	VIE.	The	Company	recorded appropriated	retained	earnings	for	the	difference	between	the	assets	and	liabilities	of the	CLOs	recorded	on	the	consolidated	statement	of	financial	condition	as	the	CLO noteholders	ultimately	will	receive	the	benefits	or	absorb	the	losses	associated	with	the CLOs'	assets	and	liabilities.	Changes	in	the	fair	value	of	the	assets	and	liabilities	of these	CLOs	have	no	impact	on	net	income	attributable	to	BlackRock	or	its	cash	flows. Excluding	outstanding	management	receivables,	the	Company	has	no	risk	of	loss	with its	involvement	with	these	VIEs.

Sponsored	Private	Equity	Fund	of	Funds.	At	December	31,	2013,	BlackRock	was determined	to	be	the	PB	of	one	investment	fund	of	funds	and	was	deemed	to	absorb the	majority	of	the	variability	due	to	its	de-facto	related-party	relationships	with	other partners	in	the	fund,	which	limited	the	ability	of	the	partners	to	transfer	or	sell	their interests	without	BlackRock's	consent	as	the	general	partner	of	the	fund.	Changes	in the	fair	value	of	the	assets	and	liabilities	of	this	VIE	recorded	on	the	consolidated statements	of	financial	condition	have	no	impact	on	net	income	attributable	to BlackRock.	Excluding	outstanding	management	fee	receivables,	the	Company	has	no risk	of	loss	related	to	its	involvement	with	this	VIE.

Consolidation	of	Voting	Rights	Entities.	To	the	extent	that	BlackRock	can	exert	control over	the	financial	and	operating	policies	of	the	investee,	which	generally	exists	if	there is	a	50%	or	greater	voting	interest	or	if	partners	or	members	of	certain	products	do	not have	substantive	rights,	BlackRock	consolidates	the	investee.

The	Company,	as	general	partner	or	managing	member	of	certain	sponsored investment	funds,	generally	is	presumed	to	control	funds	that	are	limited	partnerships or	limited	liability	companies.	Pursuant	to	ASC	810-20,	Control	of	Partnerships	and Similar	Entities	("ASC	810-20"),	the	Company	reviews	such	investment	vehicles	to determine	if	such	a	presumption	can	be	overcome	by	determining	whether	other nonaffiliated	partners	or	members	of	the	limited	partnership	or	limited	liability	company have	the

substantive	ability	to	dissolve	(liquidate)	the	investment	vehicle,	or	otherwise	to	remove BlackRock	as	the	general	partner	or	managing	member	without	cause	based	on	a simple	unaffiliated	majority	vote,	or	have	other	substantive	participating	rights.	If	the investment	vehicle	is	not	a	VIE	and	the	presumption	of	control	is	not	overcome, BlackRock	will	consolidate	the	investment	vehicle.

At	December	31,	2013	and	2012,	as	a	result	of	consolidation	of	various	investment products	deemed	to	be	voting	rights	entities,	including	products	where	BlackRock	owns 50%	or	greater	of	the	voting	rights	of	the	product,	under	the	consolidation	policies described	above,	the	Company	had	the	following	balances	on	its	consolidated statements	of	financial	condition:

|  | December	31, | December	31, |
| :--- | :--- | :--- |
| (in\tmillions) | 2013 | 2012 |
| Cash\tand\tcash\tequivalents | $114 | $133 |
| Investments: |  |  |
| Trading\tinvestments | \t\t385 | \t\t123 |
| Other\tinvestments | 441 | 401 |
| Other\tassets | 20 | 25 |
| Other\tliabilities | (39) | (65) |
| Noncontrolling\tinterests | (189) | (187) |
| BlackRock's\tnet\tinterests\tin\nconsolidated\tinvestment\tfunds | $732 | $430 |

The	Company	retained	the	specialized	accounting	of	these	investment	funds	pursuant to	ASC	810.	VIEs,	including	a	consolidated	sponsored	investment	fund	and	CLOs,	were excluded	from	the	balances	above	as	the	balances	of	these	VIEs	are	reported separately	on	the	consolidated	statements	of	financial	condition.

Equity	Method	Investments.	For	equity	investments	where	BlackRock	does	not	control the	investee,	and	where	it	is	not	the	PB	of	a	VIE,	but	can	exert	significant	influence	over the	financial	and	operating	policies	of	the	investee,	the	Company	follows	the	equity method	of	accounting.	The	evaluation	of	whether	the	Company	exerts	control	or significant	influence	over	the	financial	and	operational	policies	of	its	investees	requires significant	judgment	based	on	the	facts	and	circumstances	surrounding	each	individual investment.	Factors	considered	in	these	evaluations	may	include	the	type	of investment,	the	legal	structure	of	the	investee,	the

terms	and	structure	of	the	investment	agreement,	including	investor	voting	or	other rights,	the	terms	of	BlackRock's	advisory	agreement	or	other	agreements	with	the investee,	any	influence	BlackRock	may	have	on	the	governing	board	of	the	investee, the	legal	rights	of	other	investors	in	the	entity	pursuant	to	the	fund's	operating documents	and	the	relationship	between	BlackRock	and	other	investors	in	the	entity.

BlackRock's	equity	method	investees	that	are	investment	companies	record	their underlying	investments	at	fair	value.	Therefore,	under	the	equity	method	of	accounting, BlackRock's	share	of	the	investee's	underlying	net	income	predominantly	represents fair	value	adjustments	in	the	investments	held	by	the	equity	method	investees. BlackRock's	share	of	the	investee's	underlying	net	income	or	loss	is	based	upon	the most	currently	available	information	and	is	recorded	as	nonoperating	income	(expense) for	investments	in	investment	companies,	or	as	other	revenue	for	certain	strategic investments,	which	are	recorded	in	other	assets,	since	such	investees	are	considered to	be	an	extension	of	BlackRock's	core	business.

At	December	31,	2013,	the	Company	had	$736	million	and	$163	million	of	equity method	investments,	including	equity	method	investments	held	for	deferred compensation,	reflected	within	investments	and	other	assets,	respectively,	and	at December	31,	2012,	the	Company	had	$604	million	and	$124	million	of	equity	method investees	reflected	in	investments	and	other	assets,	respectively.

Impairment	of	Investments.	The	Company's	management	periodically	assesses	its equity	method,	available-for-sale,	held-to-maturity	and	cost	investments	for	impairment. If	circumstances	indicate	that	impairment	may	exist,	investments	are	evaluated	using market	values,	where	available,	or	the	expected	future	cash	flows	of	the	investment.	If the	undiscounted	expected	future	cash	flows	are	lower	than	the	Company's	carrying value	of	the	investment,	an	impairment	charge	is	recorded	in	the	consolidated statement	of	income.

When	the	fair	value	of	available-for-sale	securities	is	lower	than	cost,	the	Company evaluates	the	security	to	determine	whether	the	impairment	is	considered	"other-than- temporary".	In	making	this	determination	for	equity	securities,	the	Company	considers, among	other	factors,	the	length	of	time	the	security	has	been	in	a	loss	position,	the extent	to	which	the	security's	market	value	is	less	than	cost,	the	financial	condition	and near-term	prospects	of	the	security's	issuer	and	the	Company's	ability	and	intent	to	hold the	security	for	a	length	of	time	sufficient	to	allow	for	recovery	of	such	unrealized	losses. If	the	impairment	is	considered	other-than-temporary,	an	impairment	charge	is	recorded in	nonoperating	income	(expense)	on	the	consolidated	statement	of	income.	In	making this	determination	for	debt	securities,	the	Company	considers	whether:	(1)	it	has	the intent	to	sell	the	security,	(2)	it	is	more	likely	than	not	that	it	will	be	required	to	sell	the security	before	recovery	or	(3)	it	expects	to	recover	the	entire	amortized	cost	basis	of the	security.	If	the	Company	does	not	intend	to	sell	a	security	and	it	is	not	more	likely than	not	that	it	will	be	required	to	sell	the	security,	but	the	security	has	suffered	a	credit loss,	the	credit	loss	will	be	bifurcated	from	the	total	impairment	and	recorded	in	earnings with	the	remaining	portion	recorded	in	accumulated	other	comprehensive	income.

Evaluation	of	securities	impairments	involves	significant	assumptions	and	management judgments,	which	could	differ	from	actual	results,	and	these	differences	could	have	a material	impact	on	the	consolidated	statements	of	income.

# Fair	Value	Measurements.

Hierarchy	of	Fair	Value	Inputs.	The	provisions	of	ASC	820,	Fair	Value	Measurement ("ASC	820"),	establish	a	hierarchy	that	prioritizes	inputs	to	valuation	techniques	used	to measure	fair	value	and	require	companies	to	disclose	the	fair	value	of	their	financial instruments	according	to	the	fair	value	hierarchy	(i.e.,	Level	1,	2	and	3	inputs,	as defined).	The	fair	value	hierarchy	gives	the	highest	priority	to	quoted	prices	(unadjusted) in	active	markets	for	identical	assets	or	liabilities	and	the	lowest	priority	to	unobservable inputs.	See	Note	2,	Significant	Accounting	Policies,	for	further	description	of	the Company's	assets	and	liabilities	measured	at	fair	value.

Significance	of	Inputs.	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	financial	instrument.

Valuation	Techniques.	The	fair	values	of	certain	Level	3	assets	and	liabilities	were determined	using	various	methodologies	as	appropriate,	including	NAVs	of	underlying investments,	third-party	pricing	vendors,	broker	quotes	and	market	and	income approaches.	Such	quotes	and	modeled	prices	are	evaluated	for	reasonableness through	various	procedures,	including	due	diligence	reviews	of	third-party	pricing vendors,	variance	analyses,	consideration	of	the	current	market	environment	and	other analytical	procedures.	BlackRock's	$574	million	of	Level	3	investments,	or	27%	of	total GAAP	investments	at	December	31,	2013,	primarily	included	co-investments	in	private equity	fund	of	funds	and	private	equity	funds,	funds	of	hedge	funds	as	well	as alternative	hedge	funds	that	invest	in	distressed	credit	and	mortgage	securities	and	real estate	equity	products.

As	a	practical	expedient,	the	Company	relies	on	NAV	as	the	fair	value	for	certain investments.	The	inputs	to	value	these	investments	may	include	BlackRock	capital accounts	for	its	partnership	interests	in	various	alternative	investments,	including distressed	credit	hedge	funds,	real	estate	and	private	equity	funds,	which	may	be adjusted	by	using	the	returns	of	certain	market	indices.	The	various	partnerships	are investment	companies,	which	record	their	underlying	investments	at	fair	value	based	on fair	value	policies	established	by	management	of	the	underlying	fund.	Fair	value policies	at	the	underlying	fund	generally	require	the	fund	to	utilize	pricing/valuation information	from	third-party	sources,	including	independent	appraisals.	However,	in some	instances,	current	valuation	information	for	illiquid	securities	or	securities	in markets	that	are	not	active	may	not	be	available	from	any	third-party	source	or	fund management	may	conclude	that	the	valuations	that	are	available	from	third-party sources	are	not	reliable.	In	these	instances,	fund	management	may	perform	model- based	analytical	valuations	that	may	be	used	as	an	input	to	value	these	investments.

A	significant	amount	of	inputs	used	to	value	equity,	debt	securities	and	bank	loans	is sourced	from	well-recognized	third-party	pricing	vendors.	Generally,	prices	obtained from	pricing	vendors	are	categorized	as	Level	1	inputs	for	identical	securities	traded	in active	markets	and	as	Level	2

for	other	similar	securities	if	the	vendor	uses	observable	inputs	in	determining	the	price. Annually,	BlackRock's	internal	valuation	committee	or	other	designated	groups	review both	the	valuation	methodologies,	including	the	general	assumptions	and	methods	used to	value	various	asset	classes,	and	operational	processes	with	these	vendors.	In addition,	on	a	quarterly	basis,	meetings	are	held	with	key	vendors	to	identify	any significant	changes	to	the	vendors'	processes.

In	addition,	quotes	obtained	from	brokers	generally	are	non-binding	and	categorized	as Level	3	inputs.	However,	if	the	Company	is	able	to	determine	that	market	participants have	transacted	for	the	asset	in	an	orderly	manner	near	the	quoted	price	or	if	the Company	can	determine	that	the	inputs	used	by	the	broker	are	observable,	the	quote	is classified	as	a	Level	2	input.

Changes	in	Valuation.	Changes	in	value	on	$1,622	million	of	investments	will	impact the	Company's	nonoperating	income	(expense),	$183	million	will	impact	accumulated other	comprehensive	income,	$243	million	are	held	at	cost	or	amortized	cost	and	the remaining	$103	million	relates	to	carried	interest,	which	will	not	impact	nonoperating income	(expense).	At	December	31,	2013,	changes	in	fair	value	of	approximately	$785 million	of	such	investments	within	consolidated	sponsored	investment	funds	will	impact BlackRock's	net	income	(loss)	attributable	to	noncontrolling	interests	expense	on	the consolidated	statements	of	income.	BlackRock's	net	exposure	to	changes	in	fair	value of	such	consolidated	sponsored	investment	funds	was	$691	million.

# Goodwill	and	Intangible	Assets

The	value	of	advisory	contracts	acquired	in	business	acquisitions	to	manage	AUM	in proprietary	open-end	investment	funds	as	well	as	collective	trust	funds	without	a specified	termination	date	are	classified	as	indefinite-lived	intangible	assets.	The assignment	of	indefinite	lives	to	such	investment	fund	contracts	is	based	upon	the assumption	that	there	is	no	foreseeable	limit	on	the	contract	period	to	manage	these funds	due	to	the	likelihood	of	continued	renewal	at	little	or	no	cost.	In	addition,	trade names/trademarks	are	considered	indefinite-lived	intangibles	as	they	are	expected	to generate	cash	flows	indefinitely.	Goodwill	represents	the	cost	of	a	business	acquisition in	excess	of	the	fair	value	of	the	net	assets	acquired.	In	accordance	with	the	applicable provisions	of	ASC	350,	Intangibles	–	Goodwill	and	Other	("ASC	350"),	indefinite-lived intangible	assets	and	goodwill	are	not	amortized.	Finite-lived	management	contracts, which	relate	to	acquired	separate	accounts	and	funds	with	a	specified	termination	date, are	amortized	over	their	remaining	expected	useful	lives,	which,	at	December	31,	2013, ranged	from	1	to	11	years	with	a	weighted-average	remaining	estimated	useful	life	of 4.3	years.

Goodwill.	The	Company	assesses	its	goodwill	for	impairment	at	least	annually, considering	such	factors	as	the	book	value	and	the	market	capitalization	of	the Company.	The	impairment	assessment	performed	as	of	July	31,	2013	indicated	that	no impairment	charge	was	required.	The	Company	continuously	monitors	its	book	value per	share	as	compared	with	closing	prices	of	its	common	stock	for	potential	indicators of	impairment.	At	December	31,	2013,	the	Company's	common	stock	closed	at	$316.47 which	exceeded	its	book	value	per	share	of	approximately	$156.69	after	excluding appropriated	retained	earnings.

Indefinite-lived	and	finite-lived	intangibles.	The	Company	performs	assessments	to determine	if	any	intangible	assets	are	potentially	impaired	and	whether	the	indefinite- life	and	finite-life	classifications	are	still	appropriate.	In	evaluating	whether	it	is	more likely	than	not	that	the	fair	value	of	indefinite-lived	intangibles	is	less	than	its	carrying value,	BlackRock	assesses	various	significant	factors	including	AUM,	revenue	basis points,	projected	AUM	growth	rates,	operating	margins,	tax	rates	and	discount	rates.	In addition,	the	Company	considers	other	factors	including:	(i)	macroeconomic	conditions such	as	a	deterioration	in	general	economic	conditions,	limitations	on	accessing	capital, fluctuations	in	foreign	exchange	rates,	or	other	developments	in	equity	and	credit markets;	(ii)	industry	and	market	considerations	such	as	a	deterioration	in	the environment	in	which	an	entity	operates,	an	increased	competitive	environment,	a decline	in	market-dependent	multiples	or	metrics,	a	change	in	the	market	for	an	entity's services,	or	regulatory,	legal	or	political	developments;	and	(iii)	entity-specific	events, such	as	a	change	in	management	or	key	personnel,	overall	financial	performance	and litigation	that	could	affect	significant	inputs.

If	potential	impairment	circumstances	are	considered	to	exist,	the	Company	will	perform an	impairment	test,	using	an	undiscounted	cash	flow	analysis.	Actual	results	could	differ from	these	cash	flow	estimates,	which	could	materially	impact	the	impairment conclusion.	If	the	asset	is	determined	to	be	impaired,	the	difference	between	the	book value	of	the	asset	and	its	current	fair	value	would	be	recognized	as	an	expense	in	the period	in	which	the	impairment	occurs.

In	addition,	management	judgment	is	required	to	estimate	the	period	over	which	finite- lived	intangible	assets	will	contribute	to	the	Company's	cash	flows	and	the	pattern	in which	these	assets	will	be	consumed.	A	change	in	the	remaining	useful	life	of	any	of these	assets,	or	the	reclassification	of	an	indefinite-lived	intangible	asset	to	a	finite-lived intangible	asset,	could	have	a	significant	impact	on	the	Company's	amortization expense,	which	was	$161	million,	$157	million	and	$156	million	for	2013,	2012	and 2011,	respectively.

In	2013,	2012	and	2011,	the	Company	performed	impairment	tests,	including	evaluating various	qualitative	factors	and	performing	certain	quantitative	assessments	in	2013. The	Company	determined	that	no	impairment	charges	were	required,	the	classification of	indefinite-lived	versus	finite-lived	intangibles	was	still	appropriate	and	no	changes	to the	expected	lives	of	the	finite-lived	intangibles	were	required.	The	Company continuously	monitors	various	factors,	including	AUM,	for	potential	indicators	of impairment.

Income	Taxes.	The	Company	accounts	for	income	taxes	under	the	asset	and	liability method	prescribed	by	ASC	740,	Income	Taxes	("ASC	740").	Deferred	income	tax assets	and	liabilities	are	recognized	for	future	tax	consequences	attributable	to temporary	differences	between	the	financial	statement	carrying	amounts	of	existing assets	and	liabilities	and	their	respective	tax	bases	using	currently	enacted	tax	rates	in effect	for	the	year	in	which	the	differences	are	expected	to	reverse.	The	effect	of	a change	in	tax	rates	on	deferred	tax	assets	and	liabilities	is	recognized	in	income	in	the period	that	includes	the	enactment	date.

Significant	management	judgment	is	required	in	estimating	the	ranges	of	possible outcomes	and	determining	the	probability	of	favorable	or	unfavorable	tax	outcomes	and potential	interest	and	penalties	related	to	such	unfavorable

outcomes.	Actual	future	tax	consequences	relating	to	uncertain	tax	positions	may	be materially	different	than	the	Company's	current	estimates.	At	December	31,	2013, BlackRock	had	$467	million	of	gross	unrecognized	tax	benefits,	of	which	$304	million,	if recognized,	would	affect	the	effective	tax	rate.

In	accordance	with	ASC	740,	management	is	required	to	estimate	the	timing	of	the recognition	of	deferred	tax	assets	and	liabilities,	make	assumptions	about	the	future deductibility	of	deferred	income	tax	assets	and	assess	deferred	income	tax	liabilities based	on	enacted	tax	rates	for	the	appropriate	tax	jurisdictions	to	determine	the	amount of	such	deferred	income	tax	assets	and	liabilities.	At	December	31,	2013,	the	Company had	deferred	tax	assets	of	$4	million	and	deferred	tax	liabilities	of	approximately	$5,085 million	on	the	consolidated	statement	of	financial	condition.	Changes	in	the	calculated deferred	tax	assets	and	liabilities	may	occur	in	certain	circumstances,	including statutory	income	tax	rate	changes,	statutory	tax	law	changes,	changes	in	the anticipated	timing	of	recognition	of	deferred	tax	assets	and	liabilities	or	changes	in	the structure	or	tax	status	of	the	Company.

ASC	740	requires	the	Company	to	assess	whether	a	valuation	allowance	should	be established	against	its	deferred	income	tax	assets	based	on	consideration	of	all available	evidence,	both	positive	and	negative,	using	a	more	likely	than	not	standard. This	assessment	considers,	among	other	matters,	the	nature,	frequency	and	severity	of recent	losses,	forecast	of	future	profitability,	the	duration	of	statutory	carry	back	and carry	forward	periods,	the	Company's	experience	with	tax	attributes	expiring	unused, and	tax	planning	alternatives.

At	December	31,	2013,	the	Company	had	recorded	a	deferred	tax	asset	of	$99	million for	unrealized	investment	losses;	however,	no	valuation	allowance	has	been established	because	the	Company	expects	to	hold	certain	investments	which	invest	in fixed	income	securities	over	a	period	sufficient	for	them	to	recover	their	unrealized losses,	and	generate	future	capital	gains	sufficient	to	offset	the	unrealized	capital losses.	Based	on	the	weight	of	available	evidence,	it	is	more	likely	than	not	that	the deferred	tax	asset	will	be	realized.	However,	changes	in	circumstance	could	cause	the Company	to	revalue	its	deferred	tax	balances	with	the	resulting	change	impacting	the consolidated	statements	of	income	in	the	period	of	the	change.	Such	changes	may	be material	to	the	Company's	consolidated	financial	statements.	See	Note	21,	Income Taxes,	to	the	consolidated	financial	statements	beginning	on	page	F-1	of	this	Form	10- K	for	further	details.

The	Company	records	income	taxes	based	upon	its	estimated	income	tax	liability	or benefit.	The	Company's	actual	tax	liability	or	benefit	may	differ	from	the	estimated income	tax	liability	or	benefit.	The	Company	had	current	income	taxes	receivables	of approximately	$89	million	and	current	income	taxes	payables	of	$168	million	at December	31,	2013.

Revenue	Recognition.	Investment	advisory	and	administration	fees	are	recognized	as the	services	are	performed.	Such	fees	are	primarily	based	on	pre-determined percentages	of	the	market	value	of	AUM	or,	in	the	case	of	certain	real	estate	clients,	net operating	income	generated	by	the	underlying	properties.	Investment	advisory	and administration	fees	are	affected	by	changes	in	AUM,	including	market	appreciation	or depreciation,	foreign

exchange	translation	and	net	subscriptions	or	redemptions.	Investment	advisory	and administration	fees	for	investment	funds	are	shown	net	of	fees	waived	pursuant	to contractual	expense	limitations	of	the	funds	or	voluntary	waivers.

The	Company	contracts	with	third	parties	and	related	parties	for	various	fund distribution	and	shareholder	servicing	to	be	performed	on	behalf	of	certain	funds	the Company	manages.	Such	arrangements	generally	are	priced	as	a	portion	of	the management	fee	paid	by	the	fund.	In	certain	cases,	the	fund	takes	on	the	primary responsibility	for	payment	for	services	such	that	the	Company	bears	no	credit	risk	to	the third	party.	The	Company	accounts	for	such	retrocession	arrangements	in	accordance with	ASC	605-45,	Revenue	Recognition	—	Principle	Agent	Considerations	("ASC	605- 45"),	and	records	its	management	fees	net	of	retrocessions.	Retrocessions	for	2013, 2012	and	2011	were	$785	million,	$793	million	and	$928	million,	respectively.	The Company	has	additional	contracts	for	similar	services	with	third	parties,	which	due	to the	terms	of	the	contracts,	are	recorded	as	distribution	and	servicing	costs	and	thus	not netted	on	the	consolidated	statements	of	income.

The	Company	earns	revenue	by	lending	securities	on	behalf	of	clients	to	highly	rated banks	and	broker-dealers.	Such	revenues	are	accounted	for	on	an	accrual	basis.	The securities	loaned	are	secured	by	collateral,	generally	ranging	from	102%	to	112%	of	the value	of	the	loaned	securities.	Generally,	the	revenue	earned	is	shared	between	the Company	and	the	funds	or	accounts	managed	by	the	Company	from	which	the securities	are	borrowed.	For	2013,	2012	and	2011,	securities	lending	revenue	totaled $447	million,	$510	million	and	$397	million,	respectively,	and	is	recorded	in	investment advisory,	administration	fees	and	securities	lending	revenue	on	the	consolidated statements	of	income.	Investment	advisory,	administration	fees	and	securities	lending revenue	are	reported	together	as	the	fees	for	these	services	often	are	agreed	upon	with clients	as	a	bundled	fee.

The	Company	receives	investment	advisory	performance	fees	or	incentive	allocations, including	carried	interest	allocations,	from	certain	actively	managed	investment	funds and	certain	SMAs.	These	performance	fees	are	earned	upon	exceeding	specified relative	or	absolute	investment	return	thresholds.	Such	fees	are	recorded	upon completion	of	the	measurement	period,	which	varies	by	product	or	account,	and	could be	monthly,	quarterly,	annually	or	longer.	For	the	years	ended	2013,	2012	and	2011, performance	fee	revenue	totaled	$561	million,	$463	million	and	$371	million, respectively.	In	addition,	the	Company	receives	carried	interest	from	certain	alternative investments	upon	exceeding	performance	thresholds.	BlackRock	may	be	required	to return	all,	or	part,	of	such	carried	interest	depending	upon	future	performance	of	these funds.	Therefore,	BlackRock	records	carried	interest	subject	to	such	clawback provisions	in	investments	or	cash	to	the	extent	that	it	is	distributed,	on	its	consolidated statements	of	financial	condition.	Carried	interest	is	realized	and	recorded	as performance	fee	revenue	upon	the	earlier	of	the	termination	of	the	investment	fund	or when	the	likelihood	of	clawback	is	mathematically	improbable.	The	Company	records	a deferred	carried	interest	liability	to	the	extent	it	receives	cash	or	capital	allocations related	to	carried	interest	prior	to	meeting	the	revenue	recognition	criteria.	At December	31,	2013	and	2012,	the	Company	had	$108	million	and	$97	million, respectively,	of	deferred	carried	interest	recorded	in	other	liabilities	on	the	consolidated statements	of	financial	condition.	The	ultimate	recognition	of	performance	fee	revenue, if	any,	for	these	products	is	unknown.

Fees	earned	for	BlackRock	Solutions,	which	include	advisory	services,	are	recorded	as services	are	performed	or	when	completed	and	are	determined	using	some,	or	all,	of the	following	methods:	(i)	percentages	of	various	attributes	of	advisory	AUM	or	value	of positions	on	the	Aladdin	platform,	(ii)	fixed	fees	and	(iii)	performance	fees	if	contractual thresholds	are	met.	Revenue	earned	on	advisory	assignments	was	comprised	of	one- time	advisory	and	portfolio	structuring	fees	and	ongoing	fees	based	on	AUM	of	the respective	portfolio	assignment.	For	2013,	2012	and	2011,	BlackRock	Solutions	and advisory	revenue	totaled	$577	million,	$518	million	and	$510	million,	respectively.

Adjustments	to	revenue	arising	from	initial	estimates	recorded	historically	have	been immaterial	since	the	majority	of	BlackRock's	investment	advisory	and	administration revenue	is	calculated	based	on	the	fair	value	of	AUM	and	since	the	Company	does	not record	performance	revenues	until	performance	thresholds	have	been	exceeded	and the	likelihood	of	clawback	is	mathematically	improbable.

# RECENT	DEVELOPMENTS

# Accounting	Developments

For	accounting	pronouncements	that	the	Company	adopted	during	2013	and	for	recent accounting	pronouncements	not	yet	adopted,	see	Note	2,	Significant	Accounting Policies,	in	the	consolidated	financial	statements.

# Item	7a.	Quantitative	and	Qualitative	Disclosures about	Market	Risk

AUM	Market	Price	Risk.	BlackRock's	investment	advisory	and	administration	fees	are primarily	comprised	of	fees	based	on	a	percentage	of	the	value	of	AUM	and,	in	some cases,	performance	fees	expressed	as	a	percentage	of	the	returns	realized	on	AUM.	At December	31,	2013,	the	majority	of	the	Company's	investment	advisory	and administration	fees	were	based	on	average	or	period	end	AUM	of	the	applicable investment	funds	or	separate	accounts.	Movements	in	equity	market	prices,	interest rates/credit	spreads,	foreign	exchange	rates	or	all	three	could	cause	the	value	of	AUM to	decline,	which	would	result	in	lower	investment	advisory	and	administration	fees.

Corporate	Investments	Portfolio	Risks.	As	a	leading	investment	management	firm, BlackRock	devotes	significant	resources	across	all	of	its	operations	to	identifying, measuring,	monitoring,	managing	and	analyzing	market	and	operating	risks,	including the	management	and	oversight	of	its	own	investment	portfolio.	The	Board	of	Directors	of the	Company	has	adopted	guidelines	for	the	review	of	investments	to	be	made	by	the Company,	requiring,	among	other	things,	that	investments	be	reviewed	by	certain senior	officers	of	the	Company,	and	that	certain	investments	may	be	referred	to	the Audit	Committee	or	the	Board	of	Directors,	depending	on	the	circumstances,	for approval.

In	the	normal	course	of	its	business,	BlackRock	is	exposed	to	equity	market	price	risk, interest	rate/credit	spread	risk	and	foreign	exchange	rate	risk	associated	with	its corporate	investments.

BlackRock	has	investments	primarily	in	sponsored	investment	products	that	invest	in	a variety	of	asset	classes,	including

real	estate,	private	equity	and	hedge	funds.	Investments	generally	are	made	for	co- investment	purposes,	to	establish	a	performance	track	record,	to	hedge	exposure	to certain	deferred	compensation	plans	or	for	regulatory	purposes.	Currently,	the Company	has	a	seed	capital	hedging	program	in	which	it	enters	into	swaps	to	hedge market	and	interest	rate	exposure	to	certain	investments.	At	December	31,	2013,	the Company	had	outstanding	total	return	swaps	and	interest	rate	swaps	with	an	aggregate notional	value	of	approximately	$117	million	and	$71	million,	respectively.

At	December	31,	2013,	approximately	$826	million	of	BlackRock's	total	investments were	maintained	in	sponsored	investment	funds	deemed	to	be	controlled	by	BlackRock in	accordance	with	GAAP	and,	therefore,	are	consolidated	even	though	BlackRock may	not	own	a	majority	of	such	funds.	Excluding	the	impact	of	the	Federal	Reserve Bank	stock,	carried	interest,	investments	made	to	hedge	exposure	to	certain	deferred compensation	plans	and	certain	investments	that	are	hedged	via	the	seed	capital hedging	program,	the	Company's	economic	exposure	to	its	investment	portfolio	is $1,583	million.	See	Management's	Discussion	and	Analysis-Balance	Sheet Overview-Investments	for	further	information	on	the	Company's	investments.

The	"economic"	investment	exposure	of	the	portfolio	is	presented	below:

Equity	Market	Price	Risk.	At	December	31,	2013,	the	Company's	net	exposure	to equity	market	price	risk	in	its	investment	portfolio	was	approximately	$828	million	of	the Company's	total	economic	investment	exposure.	Investments	subject	to	market	price risk	include	private	equity	and	real	estate	investments,	hedge	funds	and	funds	of	funds as	well	as	mutual	funds.	The	Company	estimates	that	a	hypothetical	10%	adverse change	in	market	prices	would	result	in	a	decrease	of	approximately	$82.8	million	in	the carrying	value	of	such	investments.

Interest	Rate/Credit	Spread	Risk.	At	December	31,	2013,	the	Company	was	exposed to	interest-rate	risk	and	credit	spread	risk	as	a	result	of	approximately	$755	million	of investments	in	debt	securities	and	sponsored	investment	products	that	invest	primarily in	debt	securities.	Management	considered	a	hypothetical	100	basis	point	fluctuation	in interest	rates	or	credit	spreads	and	estimates	that	the	impact	of	such	a	fluctuation	on these	investments,	in	the	aggregate,	would	result	in	a	decrease,	or	increase,	of approximately	$12.7	million	in	the	carrying	value	of	such	investments.

Foreign	Exchange	Rate	Risk.	As	discussed	above,	the	Company	invests	in	sponsored investment	products	that	invest	in	a	variety	of	asset	classes.	The	carrying	value	of	the total	economic	investment	exposure	denominated	in	foreign	currencies,	primarily	the pound	sterling	and	euro,	was	$222	million	at	December	31,	2013.	A	10%	adverse change	in	the	applicable	foreign	exchange	rates	would	result	in	approximately	a	$22.2 million	decline	in	the	carrying	value	of	such	investments.

Other	Market	Risks.	The	Company	executes	forward	foreign	currency	exchange contracts	to	mitigate	the	risk	of	foreign	exchange	risk	movements.	At	December	31, 2013,	the	Company	had	outstanding	forward	foreign	currency	exchange	contracts	with an	aggregate	notional	value	of	approximately	$792	million.

# Item	8.	Financial	Statements and	Supplemental	Data

The	report	of	the	independent	registered	public	accounting	firm	and	financial statements	listed	in	the	accompanying	index	are	included	in	Item	15	of	this	report.	See Index	to	the	consolidated	financial	statements	on	page	F-1	of	this	Form	10-K.

# Item	9.	Changes	in	and

# Disagreements	with	Accountants	on	Accounting and	Financial	Disclosure

There	have	been	no	disagreements	on	accounting	and	financial	disclosure	matters. BlackRock	has	not	changed	accountants	in	the	two	most	recent	fiscal	years.

# Item	9a.	Controls	and	Procedures

Disclosure	Controls	and	Procedures.	Under	the	direction	of	BlackRock's	Chief Executive	Officer	and	Chief	Financial	Officer,	BlackRock	evaluated	the	effectiveness	of its	disclosure	controls	and	procedures	(as	such	term	is	defined	in	Rules	13a-15(e)	and 15d-15(e)	under	the	Exchange	Act)	as	of	the	end	of	the	period	covered	by	this	annual report	on	Form	10-K.	Based	on	this	evaluation,	BlackRock's	Chief	Executive	Officer	and Chief	Financial	Officer	have	concluded	that	BlackRock's	disclosure	controls	and procedures	were	effective.

Internal	Control	Over	Financial	Reporting.	There	have	been	no	changes	in	internal control	over	financial	reporting	during	the	latest	fiscal	quarter	that	have	materially affected	or	are	reasonably	likely	to	materially	affect	such	internal	control	over	financial reporting.

# Management's	Report	on	Internal	Control	Over	Financial	Reporting

Management	of	BlackRock,	Inc.	(the	"Company")	is	responsible	for	establishing	and	maintaining	effective	internal	control	over	financial	reporting.	Internal	control	over	financial reporting	is	defined	in	Rules	13a-15(f)	and	15d-15(f)	under	the	Securities	Exchange	Act	of	1934,	as	amended,	as	a	process	designed	by,	or	under	the	supervision	of,	the	Company's principal	executive	and	principal	financial	officers,	or	persons	performing	similar	functions,	and	affected	by	the	Company's	board	of	directors,	management	and	other	personnel,	to provide	reasonable	assurance	regarding	the	reliability	of	financial	reporting	and	the	preparation	of	financial	statements	for	external	purposes	in	accordance	with	accounting	principles generally	accepted	in	the	United	States	of	America	and	includes	those	policies	and	procedures	that:

•pertain	to	the	maintenance	of	records	that,	in	reasonable	detail	accurately	and	fairly	reflect	the	transactions	and	dispositions	of	the	assets	of	the	Company;

•provide	reasonable	assurance	that	transactions	are	recorded	as	necessary	to	permit	preparation	of	financial	statements	in	accordance	with	accounting	principles	generally accepted	in	the	United	States	of	America,	and	that	receipts	and	expenditures	of	the	Company	are	being	made	only	in	accordance	with	the	authorizations	of	management	and directors	of	the	Company;	and

•provide	reasonable	assurance	regarding	prevention	or	timely	detection	of	unauthorized	acquisition,	use	or	disposition	of	the	Company's	assets	that	could	have	a	material	effect on	the	financial	statements.

Because	of	the	inherent	limitations	of	internal	control	over	financial	reporting,	including	the	possibility	of	collusion	or	improper	management	override	of	controls,	material	misstatements due	to	error	or	fraud	may	not	be	prevented	or	detected	on	a	timely	basis.	Also,	projections	of	any	evaluation	of	effectiveness	of	the	internal	control	over	financial	reporting	to	future periods	are	subject	to	the	risks	that	controls	may	become	inadequate	because	of	changes	in	conditions,	or	that	the	degree	of	compliance	with	the	policies	or	procedures	may deteriorate.

Management	assessed	the	effectiveness	of	the	Company's	internal	control	over	financial	reporting	as	of	December	31,	2013	based	on	the	criteria	established	in	Internal	Control	— Integrated	Framework	(1992)	issued	by	the	Committee	of	Sponsoring	Organizations	of	the	Treadway	Commission.	Based	on	this	assessment,	management	concluded	that,	as	of December	31,	2013,	the	Company's	internal	control	over	financial	reporting	is	effective.

The	Company's	independent	registered	public	accounting	firm	has	issued	an	attestation	report	on	the	effectiveness	of	the	Company's	internal	control	over	financial	reporting.

# REPORT	OF	INDEPENDENT	REGISTERED	PUBLIC	ACCOUNTING	FIRM

To	the	Board	of	Directors	and	Stockholders	of	BlackRock,	Inc.:

We	have	audited	the	internal	control	over	financial	reporting	of	BlackRock,	Inc.	and	subsidiaries	(the	"Company")	as	of	December	31,	2013,	based	on	criteria	established	in	Internal Control	–	Integrated	Framework	(1992)	issued	by	the	Committee	of	Sponsoring	Organizations	of	the	Treadway	Commission.	The	Company's	management	is	responsible	for maintaining	effective	internal	control	over	financial	reporting	and	for	its	assessment	of	the	effectiveness	of	internal	control	over	financial	reporting,	included	in	the	accompanying Management's	Report	on	Internal	Control	Over	Financial	Reporting.	Our	responsibility	is	to	express	an	opinion	on	the	Company's	internal	control	over	financial	reporting	based	on	our audit.

We	conducted	our	audit	in	accordance	with	the	standards	of	the	Public	Company	Accounting	Oversight	Board	(United	States).	Those	standards	require	that	we	plan	and	perform	the audit	to	obtain	reasonable	assurance	about	whether	effective	internal	control	over	financial	reporting	was	maintained	in	all	material	respects.	Our	audit	included	obtaining	an understanding	of	internal	control	over	financial	reporting,	assessing	the	risk	that	a	material	weakness	exists,	testing	and	evaluating	the	design	and	operating	effectiveness	of	internal control	based	on	the	assessed	risk,	and	performing	such	other	procedures	as	we	considered	necessary	in	the	circumstances.	We	believe	that	our	audit	provides	a	reasonable	basis for	our	opinion.

A	company's	internal	control	over	financial	reporting	is	a	process	designed	by,	or	under	the	supervision	of,	the	company's	principal	executive	and	principal	financial	officers,	or	persons performing	similar	functions,	and	effected	by	the	company's	board	of	directors,	management,	and	other	personnel	to	provide	reasonable	assurance	regarding	the	reliability	of	financial reporting	and	the	preparation	of	financial	statements	for	external	purposes	in	accordance	with	generally	accepted	accounting	principles.	A	company's	internal	control	over	financial reporting	includes	those	policies	and	procedures	that	(1)	pertain	to	the	maintenance	of	records	that,	in	reasonable	detail,	accurately	and	fairly	reflect	the	transactions	and	dispositions	of the	assets	of	the	company;	(2)	provide	reasonable	assurance	that	transactions	are	recorded	as	necessary	to	permit	preparation	of	financial	statements	in	accordance	with	generally accepted	accounting	principles,	and	that	receipts	and	expenditures	of	the	company	are	being	made	only	in	accordance	with	authorizations	of	management	and	directors	of	the company;	and	(3)	provide	reasonable	assurance	regarding	prevention	or	timely	detection	of	unauthorized	acquisition,	use,	or	disposition	of	the	company's	assets	that	could	have	a material	effect	on	the	financial	statements.

Because	of	the	inherent	limitations	of	internal	control	over	financial	reporting,	including	the	possibility	of	collusion	or	improper	management	override	of	controls,	material	misstatements due	to	error	or	fraud	may	not	be	prevented	or	detected	on	a	timely	basis.	Also,	projections	of	any	evaluation	of	the	effectiveness	of	the	internal	control	over	financial	reporting	to	future periods	are	subject	to	the	risk	that	the	controls	may	become	inadequate	because	of	changes	in	conditions,	or	that	the	degree	of	compliance	with	the	policies	or	procedures	may deteriorate.

In	our	opinion,	the	Company	maintained,	in	all	material	respects,	effective	internal	control	over	financial	reporting	as	of	December	31,	2013,	based	on	the	criteria	established	in Internal	Control	–	Integrated	Framework	(1992)	issued	by	the	Committee	of	Sponsoring	Organizations	of	the	Treadway	Commission.

We	have	also	audited,	in	accordance	with	the	standards	of	the	Public	Company	Accounting	Oversight	Board	(United	States),	the	consolidated	statement	of	financial	condition	as	of December	31,	2013	and	the	related	consolidated	statements	of	income,	comprehensive	income,	changes	in	equity	and	cash	flows	for	the	year	then	ended	of	the	Company	and	our report	dated	February	28,	2014	expressed	an	unqualified	opinion	on	those	consolidated	financial	statements.

/s/		Deloitte	&	Touche	LLP

New	York,	New	York

# Item	9b.	Other	Information

The	Company	is	furnishing	no	other	information	in	this	Form		10-K.

# PART	III

Item	10.	Directors,	Executive Officers	and	Corporate	Governance

The	information	regarding	directors	and	executive	officers	set	forth	under	the	captions "Item	1:	Election	of	Directors	–	Information	Concerning	the	Nominees	and	Directors" and	"Item	1:	Election	of	Directors	–	Other	Executive	Officers"	of	the	Proxy	Statement	is incorporated	herein	by	reference.

The	information	regarding	compliance	with	Section	16(a)	of	the	Exchange	Act	set	forth under	the	caption	"Item	1:	Section	16(a)	Beneficial	Ownership	Reporting	Compliance" of	the	Proxy	Statement	is	incorporated	herein	by	reference.

The	information	regarding	BlackRock's	Code	of	Ethics	for	Chief	Executive	and	Senior Financial	Officers	under	the	caption	"Item	1:	Corporate	Governance	Guidelines	and Code	of	Business	Conduct	and	Ethics"	of	the	Proxy	Statement	is	incorporated	herein	by reference.

# Item	11.	Executive	Compensation

The	information	contained	in	the	sections	captioned	"Item	1:	Compensation	of Executive	Officers"	and	"Item	1:	2013	Director	Compensation"	of	the	Proxy	Statement	is incorporated	herein	by	reference.

# Item	12.	Security	Ownership	of

Certain	Beneficial	Owners	and	Management	and Related	Stockholder	Matters

The	information	contained	in	the	sections	captioned	"Item	1:	Ownership	of	BlackRock Common	and	Preferred	Stock"	and	"Equity	Compensation	Plan	Information"	of	the Proxy	Statement	is	incorporated	herein	by	reference.

# Item	13.	Certain	Relationships	and

# Related	Transactions,	and	Director	Independence

The	information	contained	in	the	sections	captioned	"Item	1:	Certain	Relationships	and Related	Transactions"	and	"Item	1:	Director	Independence"	of	the	Proxy	Statement	is incorporated	herein	by	reference.

# Item	14.	Principal	Accountant	Fees and	Services

The	information	regarding	BlackRock's	independent	auditor	fees	and	services	in	the section	captioned	"Item	4:	Ratification	of	Appointment	of	Independent	Registered	Public Accounting	Firm"	of	the	Proxy	Statement	is	incorporated	herein	by	reference.

# Item	15.	Exhibits	and	Financial Statement	Schedules

# 1.	Financial	Statements

The	Company's	consolidated	financial	statements	are	included	beginning	on	pages	F-1.

# 2.	Financial	Statement	Schedules

Ratio	of	Earnings	to	Fixed	Charges	has	been	included	as	Exhibit	12.1.	All	other schedules	have	been	omitted	because	they	are	not	applicable,	not	required	or	the information	required	is	included	in	the	Company's	consolidated	financial	statements	or notes	thereto.

# 3.	Exhibit	Index

As	used	in	this	exhibit	list,	"BlackRock"	refers	to	BlackRock,	Inc.	(formerly	named	New BlackRock,	Inc.	and	previously,	New	Boise,	Inc.)	(Commission	File	No.	001-33099)	and "Old	BlackRock"	refers	to	BlackRock	Holdco	2,	Inc.	(formerly	named	BlackRock,	Inc.) (Commission	File	No.	001-15305),	which	is	the	predecessor	of	BlackRock.	The following	exhibits	are	filed	as	part	of	this	Annual	Report	on	Form	10-K:

Please	note	that	the	agreements	included	as	exhibits	to	this	Form	10-K	are	included	to provide	information	regarding	their	terms	and	are	not	intended	to	provide	any	other factual	or	disclosure	information	about	BlackRock	or	the	other	parties	to	the agreements.	The	agreements	contain	representations	and	warranties	by	each	of	the parties	to	the	applicable	agreement	that	have	been	made	solely	for	the	benefit	of	the other	parties	to	the	applicable	agreement	and	may	not	describe	the	actual	state	of affairs	as	of	the	date	they	were	made	or	at	any	other	time.

				3.4(1) Certificate	of	Designations	of	Series	A	Convertible	Participating	Preferred	Stock	of	BlackRock.

				3.5(3) Certificate	of	Designations	of	Series	B	Convertible	Participating	Preferred	Stock	of	BlackRock.

				3.6(3) Certificate	of	Designations	of	Series	C	Convertible	Participating	Preferred	Stock	of	BlackRock.

				3.7(4) Certificate	of	Designations	of	Series	D	Convertible	Participating	Preferred	Stock	of	BlackRock.

				4.2(6) Indenture,	dated	September	17,	2007,	between	BlackRock	and	The	Bank	of	New	York,	as	trustee,	relating	to	senior	debt	securities.

		10.2(12) Amended	and	Restated	BlackRock,	Inc.	1999	Annual	Incentive	Performance	Plan.	+

		10.3(13) Amendment	No.	1	to	the	BlackRock,	Inc.	Amended	and	Restated	1999	Annual	Incentive	Performance	Plan.+

		10.4(5) BlackRock,	Inc.	Voluntary	Deferred	Compensation	Plan,	as	amended	and	restated	as	of	January	1,	2005.+

		10.5(1) Form	of	Stock	Option	Agreement	expected	to	be	used	in	connection	with	future	grants	of	Stock	Options	under	the	BlackRock,	Inc.	1999	Stock	Award	and Incentive	Plan.+

		10.6(1) Form	of	Restricted	Stock	Agreement	expected	to	be	used	in	connection	with	future	grants	of	Restricted	Stock	under	the	BlackRock,	Inc.	1999	Stock	Award and	Incentive	Plan.+

		10.7(14) Form	of	Restricted	Stock	Unit	Agreement	expected	to	be	used	in	connection	with	future	grants	of	Restricted	Stock	Units	under	the	BlackRock,	Inc.	1999 Stock	Award	and	Incentive	Plan.+

		10.8(14) Form	of	Restricted	Stock	Unit	Agreement	expected	to	be	used	in	connection	with	future	grants	of	Restricted	Stock	Units	for	long-term	incentive	awards under	the	BlackRock,	Inc.	1999	Stock	Award	and	Incentive	Plan.+

		10.9(1) Form	of	Directors'	Restricted	Stock	Unit	Agreement	expected	to	be	used	in	connection	with	future	grants	of	Restricted	Stock	Units	under	the	BlackRock, Inc.	1999	Stock	Award	and	Incentive	Plan.+

		10.10(5) Registration	Rights	Agreement,	dated	as	of	September	29,	2006,	among	BlackRock,	Merrill	Lynch	&	Co.,	Inc.	and	the	PNC	Financial	Service	Group,	Inc. 		10.11(15) Share	Surrender	Agreement,	dated	October	10,	2002	(the	"Share	Surrender	Agreement"),	among	Old	BlackRock,	PNC	Asset	Management,	Inc.	and	The PNC	Financial	Services	Group,	Inc.+

		10.16(19) Five-Year	Revolving	Credit	Agreement,	dated	as	of	March	10,	2011,	by	and	among	BlackRock,	Inc.,	certain	of	its	subsidiaries,	Wells	Fargo	Bank,	National Association,	as	administrative	agent,	swingline	lender,	issuing	lender	and	L/C	agent,	Sumitomo	Mitsui	Banking	Corporation,	as	Japanese	Yen	lender,	a group	of	lenders,	Wells	Fargo	Securities,	LLC,	Citigroup	Global	Markets	Inc.,	Merrill	Lynch,	Pierce,	Fenner	&	Smith	Incorporated,	Barclays	Capital,	J.P. Morgan	Securities	LLC	and	Morgan	Stanley	Senior	Funding,	Inc.,	as	joint	lead	arrangers	and	joint	bookrunners,	Citibank,	N.A.,	as	syndication	agent	and Bank	of	America,	N.A.,	Barclays	Bank	PLC,	JPMorgan	Chase	Bank,	N.A.	and	Morgan	Stanley	Senior	Funding,	Inc.,	as	documentation	agents.

		10.17(20) Amendment	No.	1,	dated	as	of	March	30,	2012,	by	and	among	BlackRock,	Inc.,	certain	of	its	subsidiaries,	Wells	Fargo	Bank,	National	Association,	as administrative	agent,	swingline	lender,	issuing	lender,	L/C	agent	and	a	lender,	and	the	banks	and	other	financial	institutions	referred	to	therein.

		10.18(27) Amendment	No.	2,	dated	as	of	March	28,	2013,	by	and	among	BlackRock,	Inc.,	certain	of	its	subsidiaries,	Wells	Fargo	Bank,	National	Association,	as administrative	agent,	swingline	lender,	issuing	lender,	L/C	agent	and	a	lender,	and	the	banks	and	other	financial	institutions	referred	to	therein. 		10.19(21)† Second	Amended	and	Restated	Global	Distribution	Agreement,	dated	as	of	November	15,	2010,	among	BlackRock	and	Merrill	Lynch	&	Co.,	Inc.

		10.23(24) Lease	Agreement,	dated	as	of	February	17,	2010,	among	BlackRock	Investment	Management	(UK)	Limited	and	Mourant	&	Co	Trustees	Limited	and	Mourant Property	Trustees	Limited	as	Trustees	of	the	Drapers

Gardens	Unit	Trust	for	the	lease	of	Drapers	Gardens,	12	Throgmorton	Avenue,	London,	EC2,	United	Kingdom.

(1) Incorporated	by	reference	to	BlackRock's	Current	Report	on	Form	8-K	filed	on	October	5,	2006.

(2) Incorporated	by	reference	to	BlackRock's	Current	Report	on	Form	8-K	filed	on	May	25,	2012.

(3) Incorporated	by	reference	to	BlackRock's	Current	Report	on	Form	8-K	filed	on	February	27,	2009.

(4) Incorporated	by	reference	to	BlackRock's	Current	Report	on	Form	8-K	filed	on	December	3,	2009.

(5) Incorporated	by	reference	to	BlackRock's	Registration	Statement	on	Form	S-8	(Registration	No.	333-137708)	filed	on	September	29,	2006.

(6) Incorporated	by	reference	to	BlackRock's	Annual	Report	on	Form	10-K	for	the	year	ended	December	31,	2007.

(7) Incorporated	by	reference	to	BlackRock's	Current	Report	on	Form	8-K	filed	on	September	17,	2007.

(8) Incorporated	by	reference	to	BlackRock's	Current	Report	on	Form	8-K	filed	on	December	10,	2009.

(10) Incorporated	by	reference	to	BlackRock's	Current	Report	on	Form	8-K	filed	on	May	31,	2012.

(11) Incorporated	by	reference	to	BlackRock's	Quarterly	Report	on	Form	10-Q	for	the	quarter	ended	June	30,	2010.

(12) Incorporated	by	reference	to	Old	BlackRock's	Annual	Report	on	Form	10-K	for	the	year	ended	December	31,	2002.

(13) Incorporated	by	reference	to	Old	BlackRock's	Current	Report	on	Form	8-K	filed	on	May	24,	2006.

(15) Incorporated	by	reference	to	Old	BlackRock's	Quarterly	Report	on	Form	10-Q	for	the	quarter	ended	September	30,	2002.

(16) Incorporated	by	reference	to	Old	BlackRock's	Current	Report	on	Form	8-K	filed	on	February	22,	2006.

(17) Incorporated	by	reference	to	BlackRock's	Current	Report	on	Form	8-K	filed	on	June	15,	2007.

(18) Incorporated	by	reference	to	BlackRock's	Quarterly	Report	on	Form	10-Q	for	the	quarter	ended	June	30,	2012.

(19) Incorporated	by	reference	to	BlackRock's	Current	Report	on	Form	8-K/A	filed	on	August	24,	2012.

(20) Incorporated	by	reference	to	BlackRock's	Current	Report	on	Form	8-K	filed	on	April	4,	2012.

(23) Incorporated	by	reference	to	BlackRock's	Current	Report	on	Form	8-K	filed	on	October	20,	2009.

(26) Incorporated	by	reference	to	BlackRock's	Current	Report	on	Form	8-K	filed	on	November	27,	2012.

(27) Incorporated	by	reference	to	BlackRock's	Current	Report	on	Form	8-K	filed	on	April	3,	2013.

(28) Incorporated	by	reference	to	BlackRock's	Current	Report	on	Form	8-K	filed	on	February	19,	2013.

(29) Incorporated	by	reference	to	BlackRock's	Annual	Report	on	Form	10-K	for	the	year	ended	December	31,	2012.

+ Denotes	compensatory	plans	or	arrangements

† Confidential	treatment	has	been	granted	for	certain	portions	of	this	exhibit,	which	portions	have	been	omitted	and	filed	separately	with	the	Securities	and	Exchange	Commission.

# SIGNATURES

Pursuant	to	the	requirements	of	Section	13	or	15(d)	of	the	Securities	Exchange	Act	of	1934,	the	registrant	has	duly	caused	this	report	to	be	signed	on	its	behalf	by	the	undersigned, thereunto	duly	authorized.

By: /s/	LAURENCE	D.	FINK

# Laurence	D.	Fink

# Chairman,	Chief	Executive	Officer	and	Director

Each	of	the	officers	and	directors	of	BlackRock,	Inc.	whose	signature	appears	below,	in	so	signing,	also	makes,	constitutes	and	appoints	Laurence	D.	Fink,	Gary	S.	Shedlin,	Matthew J.	Mallow,	Daniel	R.	Waltcher	and	J.	Russell	McGranahan,	his	or	her	true	and	lawful	attorneys-in-fact,	with	full	power	and	substitution,	for	him	or	her	in	any	and	all	capacities,	to execute	and	cause	to	be	filed	with	the	Securities	and	Exchange	Commission	any	and	all	amendments	to	the	Annual	Report	on	Form	10-K,	with	exhibits	thereto	and	other	documents connected	therewith	and	to	perform	any	acts	necessary	to	be	done	in	order	to	file	such	documents,	and	hereby	ratifies	and	confirms	all	that	said	attorney-in-fact	or	his	or	her	substitute or	substitutes	may	do	or	cause	to	be	done	by	virtue	hereof.

Pursuant	to	the	requirements	of	the	Securities	Exchange	Act	of	1934,	this	report	has	been	signed	below	by	the	following	persons	on	behalf	of	the	registrant	and	in	the	capacities	and on	the	dates	indicated.

# Thomas	H.	O'Brien

# Susan	L.	Wagner

# INDEX	TO	FINANCIAL	STATEMENTS

We	have	audited	the	accompanying	consolidated	statements	of	financial	condition	of	BlackRock,	Inc.	and	subsidiaries	(the	"Company")	as	of	December	31,	2013	and	2012,	and	the related	consolidated	statements	of	income,	comprehensive	income,	changes	in	equity,	and	cash	flows	for	each	of	the	three	years	in	the	period	ended	December	31,	2013.	These financial	statements	are	the	responsibility	of	the	Company's	management.	Our	responsibility	is	to	express	an	opinion	on	these	financial	statements	based	on	our	audits.

We	conducted	our	audits	in	accordance	with	the	standards	of	the	Public	Company	Accounting	Oversight	Board	(United	States).	Those	standards	require	that	we	plan	and	perform	the audit	to	obtain	reasonable	assurance	about	whether	the	financial	statements	are	free	of	material	misstatement.	An	audit	includes	examining,	on	a	test	basis,	evidence	supporting	the amounts	and	disclosures	in	the	financial	statements.	An	audit	also	includes	assessing	the	accounting	principles	used	and	significant	estimates	made	by	management,	as	well	as evaluating	the	overall	financial	statement	presentation.	We	believe	that	our	audits	provide	a	reasonable	basis	for	our	opinion.

In	our	opinion,	such	consolidated	financial	statements	present	fairly,	in	all	material	respects,	the	financial	position	of	BlackRock,	Inc.	and	subsidiaries	at	December	31,	2013	and	2012, and	the	results	of	their	operations	and	their	cash	flows	for	each	of	the	three	years	in	the	period	ended	December	31,	2013,	in	conformity	with	accounting	principles	generally	accepted in	the	United	States	of	America.

We	have	also	audited,	in	accordance	with	the	standards	of	the	Public	Company	Accounting	Oversight	Board	(United	States),	the	Company's	internal	control	over	financial	reporting	as of	December	31,	2013,	based	on	criteria	established	in	Internal	Control	–	Integrated	Framework	(1992)	issued	by	the	Committee	of	Sponsoring	Organizations	of	the	Treadway Commission	and	our	report	dated	February	28,	2014	expressed	an	unqualified	opinion	on	the	Company's	internal	control	over	financial	reporting.

# Consolidated	Statements	of	Financial	Condition

|  | December	31, | December	31, |
| :--- | :--- | :--- |
| (in\tmillions,\texcept\tper\tshare\tdata) | 2013 | 2012 |
| Assets |  |  |
| Cash\tand\tcash\tequivalents | $4,390 | $4,606 |
| Accounts\treceivable | 2,247 | 2,250 |
| Investments | 2,151 | 1,750 |
| Assets\tof\tconsolidated\tvariable\tinterest\tentities: |  |  |
| Cash\tand\tcash\tequivalents | 161 | 297 |
| Bank\tloans,\tother\tinvestments\tand\tother\tassets | 2,325 | 2,264 |
| Separate\taccount\tassets | 155,113 | 134,768 |
| Separate\taccount\tcollateral\theld\tunder\tsecurities\tlending\tagreements | 21,788 | 23,021 |
| Property\tand\tequipment\t(net\tof\taccumulated\tdepreciation\tof\t$611\tand\t$572\tat\tDecember\t31,\t2013\tand\t2012,\trespectively) | 525 | 557 |
| Intangible\tassets\t(net\tof\taccumulated\tamortization\tof\t$1,057\tand\t$899\tat\tDecember\t31,\t2013\tand\t2012,\trespectively) | 17,501 | 17,402 |
| Goodwill | 12,980 | 12,910 |
| Other\tassets | 692 | 626 |
| Total\tassets | $\t219,873 | $\t200,451 |
| Liabilities |  |  |
| Accrued\tcompensation\tand\tbenefits | $1,747 | $1,547 |
| Accounts\tpayable\tand\taccrued\tliabilities | 1,084 | 1,055 |
| Short-term\tborrowings | — | 100 |
| Liabilities\tof\tconsolidated\tvariable\tinterest\tentities: |  |  |
| Borrowings | 2,369 | 2,402 |
| Other\tliabilities | 74 | 103 |
| Long-term\tborrowings | 4,939 | 5,687 |
| Separate\taccount\tliabilities | 155,113 | 134,768 |
| Separate\taccount\tcollateral\tliabilities\tunder\tsecurities\tlending\tagreements | 21,788 | 23,021 |
| Deferred\tincome\ttax\tliabilities | 5,085 | 5,293 |
| Other\tliabilities | 1,004 | 858 |
| Total\tliabilities | 193,203 | 174,834 |
| Commitments\tand\tcontingencies\t(Note\t13) |  |  |
| Temporary\tequity |  |  |
| Redeemable\tnoncontrolling\tinterests | 54 | 32 |
| Permanent\tEquity |  |  |
| BlackRock,\tInc.\tstockholders'\tequity |  |  |
| Common\tstock,\t$\t0.01\tpar\tvalue; | 2 | 2 |
| Shares\tauthorized:\t500,000,000\tat\tDecember\t31,\t2013\tand\t2012;\tShares\tissued:\t171,252,185\tat\tDecember\t31,\t2013\tand\t2012;\tShares |  |  |
| outstanding:\t166,589,688\tand\t168,875,304\tat\tDecember\t31,\t2013\tand\t2012,\trespectively;\nSeries\tB\tnonvoting\tparticipating\tpreferred\tstock,\t$0.01\tpar\tvalue; | — | — |
| Shares\tauthorized:\t150,000,000\tat\tDecember\t31,\t2013\tand\t2012;\tShares\tissued\tand\toutstanding:\t823,188\tat\tDecember\t31,\t2013\tand\t2012; |  |  |
| Series\tC\tnonvoting\tparticipating\tpreferred\tstock,\t$0.01\tpar\tvalue; | — | — |
| Shares\tauthorized:\t6,000,000\tat\tDecember\t31,\t2013\tand\t2012;\tShares\tissued\tand\toutstanding:\t1,311,887\tand\t1,517,237\tat\tDecember\t31, |  |  |
| 2013\tand\t2012,\trespectively\nAdditional\tpaid-in\tcapital | 19,473 | 19,419 |
| Retained\tearnings | 8,208 | 6,444 |
| Appropriated\tretained\tearnings | 22 | 29 |
| Accumulated\tother\tcomprehensive\tloss | (35) | (59) |
| Treasury\tstock,\tcommon,\tat\tcost\t(4,662,497\tand\t2,376,881\tshares\theld\tat\tDecember\t31,\t2013\tand\t2012,\trespectively) | (1,210) | (432) |
| Total\tBlackRock,\tInc.\tstockholders'\tequity | 26,460 | 25,403 |
| Nonredeemable\tnoncontrolling\tinterests | 135 | 155 |
| Nonredeemable\tnoncontrolling\tinterests\tof\tconsolidated\tvariable\tinterest\tentities | 21 | 27 |
| Total\tpermanent\tequity | 26,616 | 25,585 |
| Total\tliabilities,\ttemporary\tequity\tand\tpermanent\tequity | $219,873 | $200,451 |

See	accompanying	notes	to	consolidated	financial	statements.

# Consolidated	Statements	of	Income

|  |  | Year	ended	December	31, |  |
| :--- | :--- | :--- | :--- |
| (in\tmillions,\texcept\tper\tshare\tdata) | 2013 | 2012 | 2011 |
| Revenue |  |  |  |
| Investment\tadvisory,\tadministration\tfees\tand\tsecurities\tlending\trevenue |  |  |  |
| Related\tparties | $5,991 | $5,292 | $5,303 |
| Other\tthird\tparties | 2,748 | 2,780 | 2,593 |
| Total\tinvestment\tadvisory,\tadministration\tfees\tand\tsecurities\tlending\trevenue | 8,739 | 8,072 | 7,896 |
| Investment\tadvisory\tperformance\tfees | 561 | 463 | 371 |
| BlackRock\tSolutions\tand\tadvisory | 577 | 518 | 510 |
| Distribution\tfees | 73 | 71 | 100 |
| Other\trevenue | 230 | 213 | 204 |
| Total\trevenue | 10,180 | 9,337 | 9,081 |
| Expenses |  |  |  |
| Employee\tcompensation\tand\tbenefits | 3,560 | 3,287 | 3,199 |
| Distribution\tand\tservicing\tcosts | 353 | 364 | 386 |
| Amortization\tof\tdeferred\tsales\tcommissions | 52 | 55 | 81 |
| Direct\tfund\texpenses | 657 | 591 | 563 |
| General\tand\tadministration | 1,540 | 1,359 | 1,415 |
| Restructuring\tcharges | — | — | 32 |
| Amortization\tof\tintangible\tassets | 161 | 157 | 156 |
| Total\texpenses | 6,323 | 5,813 | 5,832 |
| Operating\tincome | 3,857 | 3,524 | 3,249 |
| Nonoperating\tincome\t(expense) |  |  |  |
| Net\tgain\t(loss)\ton\tinvestments | 305 | 163 | 46 |
| Net\tgain\t(loss)\ton\tconsolidated\tvariable\tinterest\tentities | — | (38) | (18) |
| Interest\tand\tdividend\tincome | 22 | 36 | 34 |
| Interest\texpense | (211) | (215) | (176) |
| Total\tnonoperating\tincome\t(expense) | 116 | (54) | (114) |
| Income\tbefore\tincome\ttaxes | 3,973 | 3,470 | 3,135 |
| Income\ttax\texpense | 1,022 | 1,030 | 796 |
| Net\tincome | 2,951 | 2,440 | 2,339 |
| Less: |  |  |  |
| Net\tincome\t(loss)\tattributable\tto\tredeemable\tnoncontrolling\tinterests | (1) | 9 | — |
| Net\tincome\t(loss)\tattributable\tto\tnonredeemable\tnoncontrolling\tinterests | 20 | (27) | 2 |
| Net\tincome\tattributable\tto\tBlackRock,\tInc. | $2,932 | $2,458 | $2,337 |
| Earnings\tper\tshare\tattributable\tto\tBlackRock,\tInc.\tcommon\tstockholders: |  |  |  |
| Basic | $17.23 | $14.03 | $12.56 |
| Diluted | $16.87 | $13.79 | $12.37 |
| Cash\tdividends\tdeclared\tand\tpaid\tper\tshare | $6.72 | $6.00 | $5.50 |
| Weighted-average\tcommon\tshares\toutstanding: |  |  |  |
| Basic | \t 170,185,870 | \t 174,961,018 | \t 184,265,367 |
| Diluted | \t 173,828,902 | \t 178,017,679 | \t 187,116,410 |

# Consolidated	Statements	of	Comprehensive	Income

|  | Year	ended	December	31, | Year	ended	December	31, |  |
| :--- | :--- | :--- | :--- |
| (in\tmillions) | 2013 | 2012 | 2011 |
| Net\tincome | $ \t2,951 | $ \t2,440 | $\t2,339 |
| Other\tcomprehensive\tincome: |  |  |  |
| Change\tin\tnet\tunrealized\tgains\t(losses)\tfrom\tavailable-for-sale\tinvestments,\tnet\tof\ttax: |  |  |  |
| Unrealized\tholding\tgains\t(losses),\tnet\tof\ttax(1) | 4 | 26 | (3) |
| Less:\treclassification\tadjustment\tincluded\tin\tnet\tincome(1) | 13 | 6 | 1 |
| Net\tchange\tfrom\tavailable-for-sale\tinvestments,\tnet\tof\ttax | (9) | 20 | (4) |
| Benefit\tplans,\tnet(1) | 10 | (5) | — |
| Foreign\tcurrency\ttranslation\tadjustments | 23 | 53 | (27) |
| Other\tcomprehensive\tincome\t(loss) | 24 | 68 | (31) |
| Comprehensive\tincome | 2,975 | 2,508 | 2,308 |
| Less:\tComprehensive\tincome\t(loss)\tattributable\tto\tnoncontrolling\tinterests | 19 | (18) | 2 |
| Comprehensive\tincome\tattributable\tto\tBlackRock,\tInc. | $2,956 | $2,526 | $2,306 |

# Consolidated	Statements	of	Changes	in	Equity

|  |  |  |  |  |  |  |  |  | Nonredeemable |  | Redeemable |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  |  |  |  | Accumulated | Common |  |  |  | Noncontrolling |  | Noncontrolling |
|  | Additional |  | Appropriated | Other | Shares | Treasury | Total | Nonredeemable | Interests\tof | Total | Interests\t/ |
|  | Paid-in | Retained | Retained | Comprehensive | Held\tin | Stock | Stockholders' | Noncontrolling | Consolidated | Permanent | Temporary |
| (in\tmillions) | Capital(1) | Earnings | Earnings | Income\t(Loss) | Escrow | Common | Equity | Interests | VIEs | Equity | Equity |
| December\t31,\t2010 | \t$22,504\t\t\t$ | 3,723\t\t\t$ | 75\t\t\t$ | (96)\t\t$ | (1)\t\t$ | (111)\t\t$ | 26,094\t\t\t$ | 189\t\t\t$ | 45\t\t\t$ | 26,328\t\t\t$ | 6 |
| Net\tincome | — | 2,337 | — | — | — | — | 2,337 | 20 | (18) | 2,339 | — |
| Consolidation\tof\ta |  |  |  |  |  |  |  |  |  |  |  |
| collateralized\tloan |  |  |  |  |  |  |  |  |  |  |  |
| obligation | — | — | 19 | — | — | — | 19 | — | — | 19 | — |
| Allocation\tof\tgains\t(losses) |  |  |  |  |  |  |  |  |  |  |  |
| of\tconsolidated |  |  |  |  |  |  |  |  |  |  |  |
| collateralized\tloan |  |  |  |  |  |  |  |  |  |  |  |
| obligations | — | — | (22) | — | — | — | (22) | — | 22 | — | — |
| Dividends\tpaid,\tnet\tof |  |  |  |  |  |  |  |  |  |  |  |
| dividend\texpense\tfor |  |  |  |  |  |  |  |  |  |  |  |
| unvested\tRSUs | — | (1,014) | — | — | — | — | (1,014) | — | — | (1,014) | — |
| Stock-based\tcompensation | 494 | — | — | — | — | 3 | 497 | — | — | 497 | — |
| PNC\tpreferred\tstock\tcapital |  |  |  |  |  |  |  |  |  |  |  |
| contribution | 200 | — | — | — | — | — | 200 | — | — | 200 | — |
| Retirement\tof\tpreferred |  |  |  |  |  |  |  |  |  |  |  |
| stock | (200) | — | — | — | — | — | (200) | — | — | (200) | — |
| Merrill\tLynch\tcash\tcapital |  |  |  |  |  |  |  |  |  |  |  |
| contribution | 8 | — | — | — | — | — | 8 | — | — | 8 | — |
| Issuance\tof\tcommon\tshares |  |  |  |  |  |  |  |  |  |  |  |
| related\tto\temployee\tstock |  |  |  |  |  |  |  |  |  |  |  |
| transactions | (208) | — | — | — | — | \t\t228 | 20 | — | — | 20 | — |
| Employee\ttax\tbenefit |  |  |  |  |  |  |  |  |  |  |  |
| withholdings\trelated\tto |  |  |  |  |  |  |  |  |  |  |  |
| employee\tstock |  |  |  |  |  |  |  |  |  |  |  |
| transactions | — | — | — | — | — | (239) | (239) | — | — | (239) | — |
| Shares\trepurchased | (2,545) | — | — | — | — | (100) | (2,645) | — | — | (2,645) | — |
| Convertible\tdebt |  |  |  |  |  |  |  |  |  |  |  |
| conversions | 4 | — | — | — | — | 1 | 5 | — | — | 5 | — |
| Net\ttax\tbenefit\t(shortfall) |  |  |  |  |  |  |  |  |  |  |  |
| from\tstock-based |  |  |  |  |  |  |  |  |  |  |  |
| compensation | 12 | — | — | — | — | — | 12 | — | — | 12 | — |
| Subscriptions |  |  |  |  |  |  |  |  |  |  |  |
| (redemptions/distributions) |  |  |  |  |  |  |  |  |  |  |  |
| —\tnoncontrolling\tinterest |  |  |  |  |  |  |  |  |  |  |  |
| holders | — | — | — | — | — | — | — | (25) | (11) | (36) | 90 |
| Net\tconsolidations |  |  |  |  |  |  |  |  |  |  |  |
| (deconsolidations)\tof |  |  |  |  |  |  |  |  |  |  |  |
| sponsored\tinvestment |  |  |  |  |  |  |  |  |  |  |  |
| funds | — | — | — | — | — | — | — | — | — | — | (4) |
| Foreign\tcurrency\ttranslation |  |  |  |  |  |  |  |  |  |  |  |
| adjustments | 7 | — | — | \t\t\t\t— | \t\t— | — | 7 | — | — | 7 | — |
| Other\tcomprehensive |  |  |  |  |  |  |  |  |  |  |  |
| income\t(loss) | — | — | — | (31) | — | — | (31) | — | — | (31) | — |
| December\t31,\t2011 | \t$\t20,276\t\t\t$ | \t5,046\t\t\t$ | \t72\t\t\t$ | (127)\t\t$ | (1)\t\t$ | (218)\t\t$ | \t25,048\t\t\t$ | \t184\t\t\t$ | \t38\t\t\t$ | \t25,270\t\t\t$ | \t92 |

(1) Amount	includes	$1	million	of	common	stock	at	par	value	at	both	December	31,	2011	and	2010	and	$1	million	of	preferred	stock	at	par	value	at	December	31,	2010.

|  |  |  |  |  |  |  |  |  | Nonredeemable |  | Redeemable |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  |  |  |  | Accumulated | Common |  |  |  | Noncontrolling |  | Noncontrolling |
|  | Additional |  | Appropriated | Other | Shares | Treasury | Total | Nonredeemable | Interests\tof | Total | Interests\t/ |
|  | Paid-in | Retained | Retained | Comprehensive | Held\tin | Stock | Stockholders' | Noncontrolling | Consolidated | Permanent | Temporary |
| (in\tmillions) | Capital(1) | Earnings | Earnings | Income\t(Loss) | Escrow | Common | Equity | Interests | VIEs | Equity | Equity(2) |
| December\t31,\t2011 | \t$20,276\t\t\t$ | 5,046\t\t\t$ | 72\t\t\t$ | \t(127)\t\t$ | (1)\t\t$ | (218)\t\t$ | 25,048\t\t\t$ | 184\t\t\t$ | 38\t\t\t$ | 25,270\t\t\t$ | 92 |
| Net\tincome | — | 2,458 | — | — | — | — | 2,458 | 11 | (38) | 2,431 | 9 |
| Allocation\tof\tlosses |  |  |  |  |  |  |  |  |  |  |  |
| of\tconsolidated |  |  |  |  |  |  |  |  |  |  |  |
| collateralized\tloan |  |  |  |  |  |  |  |  |  |  |  |
| obligations | — | — | (43) | — | — | — | (43) | — | 43 | — | — |
| Release\tof\tcommon\nstock\tfrom\tescrow | (1) | — | — | — | 1 | — | — | — | — | — | — |
| Dividends\tpaid | — | (1,060) | — | — | — | — | (1,060) | — | — | (1,060) | — |
| Stock-based |  |  |  |  |  |  |  |  |  |  |  |
| compensation | 451 | — | — | — | — | — | 451 | — | — | 451 | — |
| Merrill\tLynch\tcash |  |  |  |  |  |  |  |  |  |  |  |
| capital |  |  |  |  |  |  |  |  |  |  |  |
| contribution | 7 | — | — | — | — | — | 7 | — | — | 7 | — |
| Issuance\tof |  |  |  |  |  |  |  |  |  |  |  |
| common\tshares |  |  |  |  |  |  |  |  |  |  |  |
| related\tto |  |  |  |  |  |  |  |  |  |  |  |
| employee\tstock |  |  |  |  |  |  |  |  |  |  |  |
| transactions | (376) | — | — | — | — | \t\t432 | 56 | — | — | 56 | — |
| Employee\ttax |  |  |  |  |  |  |  |  |  |  |  |
| benefit |  |  |  |  |  |  |  |  |  |  |  |
| withholdings |  |  |  |  |  |  |  |  |  |  |  |
| related\tto |  |  |  |  |  |  |  |  |  |  |  |
| employee\tstock |  |  |  |  |  |  |  |  |  |  |  |
| transactions | — | — | — | — | — | (146) | (146) | — | — | (146) | — |
| Shares |  |  |  |  |  |  |  |  |  |  |  |
| repurchased | (1,000) | — | — | — | — | (500) | (1,500) | — | — | (1,500) | — |
| Net\ttax\tbenefit |  |  |  |  |  |  |  |  |  |  |  |
| (shortfall)\tfrom |  |  |  |  |  |  |  |  |  |  |  |
| stock-based |  |  |  |  |  |  |  |  |  |  |  |
| compensation | 64 | — | — | — | — | — | 64 | — | — | 64 | — |
| Subscriptions |  |  |  |  |  |  |  |  |  |  |  |
| (redemptions/ |  |  |  |  |  |  |  |  |  |  |  |
| distributions)\t— |  |  |  |  |  |  |  |  |  |  |  |
| noncontrolling |  |  |  |  |  |  |  |  |  |  |  |
| interest\tholders | — | — | — | — | — | — | — | (33) | (10) | (43) | \t343 |
| Net\tconsolidations |  |  |  |  |  |  |  |  |  |  |  |
| (deconsolidations) |  |  |  |  |  |  |  |  |  |  |  |
| of\tsponsored |  |  |  |  |  |  |  |  |  |  |  |
| investment\tfunds | — | — | — | — | — | — | — | (7) | (6) | (13) | (412) |
| Other |  |  |  |  |  |  |  |  |  |  |  |
| comprehensive |  |  |  |  |  |  |  |  |  |  |  |
| income\t(loss) | — | — | — | \t\t68 | \t\t— | — | 68 | — | — | 68 | — |
| December\t31,\t2012 | \t$\t19,421\t\t\t$ | \t6,444\t\t\t$ | \t29\t\t\t$ | (59) | \t$— | \t$(432)\t\t$ | \t25,403\t\t\t$ | \t155\t\t\t$ | \t27\t\t\t$ | \t25,585\t\t\t$ | 32 |

(1) Amount	includes	$2	million	and	$1	million	of	common	stock	at	par	value	at	December	31,	2012	and	2011,	respectively.

(2) Amounts	include	$89	million	of	redemptions	and	$89	million	of	net	consolidations	related	to	consolidated	variable	interest	entities	("VIEs").

|  |  |  |  |  |  |  |  | Nonredeemable |  | Redeemable |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  |  |  |  | Accumulated |  | Total |  | Noncontrolling |  | Noncontrolling |
|  | Additional |  | Appropriated | Other | Treasury | BlackRock | Nonredeemable | Interests\tof | Total | Interests\t/ |
|  | Paid-in | Retained | Retained | Comprehensive | Stock | Stockholders' | Noncontrolling | Consolidated | Permanent | Temporary |
| (in\tmillions) | Capital(1) | Earnings | Earnings | Income\t(Loss) | Common | Equity | Interests | VIEs | Equity | Equity |
| December\t31,\t2012 | \t$19,421 | \t$6,444\t\t\t$ | 29 | \t$(59) | \t$(432) | \t$25,403 | \t$155 | \t$27 | \t$25,585 | \t$32 |
| Net\tincome | — | 2,932 | — | — | — | 2,932 | 20 | — | 2,952 | (1) |
| Consolidation\tof\ta\tcollateralized |  |  |  |  |  |  |  |  |  |  |
| loan\tobligation | — | — | (4) | — | — | (4) | — | — | (4) | — |
| Allocation\tof\tgains\t(losses)\tof |  |  |  |  |  |  |  |  |  |  |
| consolidated\tcollateralized\tloan |  |  |  |  |  |  |  |  |  |  |
| obligations | — | — | (3) | — | — | (3) | — | 3 | — | — |
| Dividends\tpaid | — | (1,168) | — | — | — | (1,168) | — | — | (1,168) | — |
| Stock-based\tcompensation | 447 | — | — | — | 1 | 448 | — | — | 448 | — |
| Issuance\tof\tcommon\tshares |  |  |  |  |  |  |  |  |  |  |
| related\tto\temployee\tstock |  |  |  |  |  |  |  |  |  |  |
| transactions | (429) | — | — | — | \t\t464 | 35 | — | — | 35 | — |
| Employee\ttax\tbenefit |  |  |  |  |  |  |  |  |  |  |
| withholdings\trelated\tto |  |  |  |  |  |  |  |  |  |  |
| employee\tstock\ttransactions | — | — | — | — | (243) | (243) | — | — | (243) | — |
| Shares\trepurchased | — | — | — | — | (1,000) | (1,000) | — | — | (1,000) | — |
| Net\ttax\tbenefit\t(shortfall)\tfrom |  |  |  |  |  |  |  |  |  |  |
| stock-based\tcompensation | 36 | — | — | — | — | 36 | — | — | 36 | — |
| Subscriptions |  |  |  |  |  |  |  |  |  |  |
| (redemptions/distributions)\t— |  |  |  |  |  |  |  |  |  |  |
| noncontrolling\tinterest\tholders | — | — | — | — | — | — | (59) | \t\t125 | 66 | \t\t137 |
| Net\tconsolidations |  |  |  |  |  |  |  |  |  |  |
| (deconsolidations)\tof\tsponsored |  |  |  |  |  |  |  |  |  |  |
| investment\tfunds | — | — | — | — | — | — | 19 | (134) | (115) | (114) |
| Other\tcomprehensive\tincome |  |  |  | \t\t24 |  |  |  |  |  |  |
| (loss) | — | — | — |  | — | 24 | — | — | 24 | — |
| December\t31,\t2013 | \t$\t19,475 | \t$\t8,208 | \t$\t22 | \t$(35) | \t$(1,210) | \t$\t26,460 | \t$\t135 | \t$21 | \t$\t26,616 | \t$54 |

# Consolidated	Statements	of	Cash	Flows

| (in	millions) | Year	ended	December	31, | Year	ended	December	31, |  |
| :--- | :--- | :--- | :--- |
| Cash\tflows\tfrom\toperating\tactivities | 2013 | 2012 | 2011 |
| Net\tincome | \t$ 2,951 | $ 2,440 | $2,339 |
| Adjustments\tto\treconcile\tnet\tincome\tto\tcash\tfrom\toperating\tactivities: |  |  |  |
| Depreciation\tand\tamortization | 291 | 295 | 299 |
| Amortization\tof\tdeferred\tsales\tcommissions | 52 | 55 | 81 |
| Stock-based\tcompensation | 448 | 451 | 497 |
| Deferred\tincome\ttax\texpense\t(benefit) | (193) | (61) | (137) |
| Gain\trelated\tto\tPennyMac\tinitial\tpublic\toffering | (39) | — | — |
| Gain\trelated\tto\tthe\tcharitable\tcontribution | (80) | — | — |
| Charitable\tcontribution | 124 | — | — |
| Net\t(gains)\tlosses\ton\tnontrading\tinvestments | (73) | (43) | (40) |
| Purchases\tof\tinvestments\twithin\tconsolidated\tsponsored\tinvestment\tfunds | (195) | (108) | (41) |
| Proceeds\tfrom\tsales\tand\tmaturities\tof\tinvestments\twithin\tconsolidated\tsponsored\tinvestment\tfunds | 145 | 96 | 50 |
| Assets\tand\tliabilities\tof\tconsolidated\tVIEs: |  |  |  |
| Change\tin\tcash\tand\tcash\tequivalents | 143 | (24) | 54 |
| Net\t(gains)\tlosses\twithin\tconsolidated\tVIEs | — | 38 | 18 |
| Net\t(purchases)\tproceeds\twithin\tconsolidated\tVIEs | 142 | (203) | 82 |
| (Earnings)\tlosses\tfrom\tequity\tmethod\tinvestees | (158) | (175) | (23) |
| Distributions\tof\tearnings\tfrom\tequity\tmethod\tinvestees | 80 | 42 | 30 |
| Other\tadjustments | 10 | (4) | — |
| Changes\tin\toperating\tassets\tand\tliabilities: |  |  |  |
| Accounts\treceivable | 14 | (292) | 124 |
| Investments,\ttrading | (218) | (664) | (116) |
| Other\tassets | (92) | (10) | (181) |
| Accrued\tcompensation\tand\tbenefits | 203 | 138 | (140) |
| Accounts\tpayable\tand\taccrued\tliabilities | 7 | 114 | (152) |
| Other\tliabilities | 80 | 155 | 82 |
| Cash\tflows\tfrom\toperating\tactivities | 3,642 | 2,240 | 2,826 |
| Cash\tflows\tfrom\tinvesting\tactivities |  |  |  |
| Purchases\tof\tinvestments | (412) | (402) | (204) |
| Proceeds\tfrom\tsales\tand\tmaturities\tof\tinvestments | 286 | 695 | 213 |
| Distributions\tof\tcapital\tfrom\tequity\tmethod\tinvestees | 83 | 73 | 34 |
| Net\tconsolidations\t(deconsolidations)\tof\tsponsored\tinvestment\tfunds | (48) | (215) | — |
| Acquisitions,\tnet\tof\tcash\tacquired | (298) | (267) | — |
| Purchases\tof\tproperty\tand\tequipment | (94) | (150) | (247) |
| Cash\tflows\tfrom\tinvesting\tactivities | (483) | (266) | (204) |
| Cash\tflows\tfrom\tfinancing\tactivities |  |  |  |
| Repayments\tof\tshort-term\tborrowings | (100) | — | (600) |
| Proceeds\tfrom\tshort-term\tborrowings | — | — | 600 |
| Repayments\tof\tconvertible\tdebt | — | — | (67) |
| Repayments\tof\tlong-term\tborrowings | (750) | (500) | — |
| Proceeds\tfrom\tlong-term\tborrowings | — | 1,495 | 1,496 |
| Cash\tdividends\tpaid | (1,168) | (1,060) | (1,014) |
| Proceeds\tfrom\tstock\toptions\texercised | 28 | 47 | 16 |
| Proceeds\tfrom\tissuance\tof\tcommon\tstock | 7 | 7 | 5 |
| Repurchases\tof\tcommon\tstock | (1,243) | (1,645) | (2,885) |
| Merrill\tLynch\tcash\tcapital\tcontribution | — | 7 | 8 |
| Net\tproceeds\tfrom\t(repayments\tof)\tborrowings\tby\tconsolidated\tVIEs | (410) | 331 | (125) |
| Net\t(redemptions/distributions\tpaid)/subscriptions\treceived\tfrom\tnoncontrolling\tinterest\tholders | 203 | 300 | 54 |
| Excess\ttax\tbenefit\tfrom\tstock-based\tcompensation | 41 | 74 | 27 |
| Cash\tflows\tfrom\tfinancing\tactivities | (3,392) | (944) | (2,485) |
| Effect\tof\texchange\trate\tchanges\ton\tcash\tand\tcash\tequivalents | 17 | 70 | 2 |
| Net\tincrease\t(decrease)\tin\tcash\tand\tcash\tequivalents | (216) | 1,100 | 139 |
| Cash\tand\tcash\tequivalents,\tbeginning\tof\tyear | 4,606 | 3,506 | 3,367 |
| Cash\tand\tcash\tequivalents,\tend\tof\tyear | \t$ 4,390 | $ 4,606 | $3,506 |
| Supplemental\tdisclosure\tof\tcash\tflow\tinformation: |  |  |  |
| Cash\tpaid\tfor: |  |  |  |
| Interest | \t$202 | $201 | $167 |
| Interest\ton\tborrowings\tof\tconsolidated\tVIEs | \t$102 | $75 | $60 |
| Income\ttaxes\t(net\tof\trefunds) | \t$ 1,064 | $976 | $962 |
| Supplemental\tschedule\tof\tnoncash\tinvesting\tand\tfinancing\ttransactions: |  |  |  |
| Issuance\tof\tcommon\tstock | \t$429 | $378 | $213 |
| PNC\tpreferred\tstock\tcapital\tcontribution | \t$— | $— | $200 |
| Increase\t(decrease)\tin\tnoncontrolling\tinterests\tdue\tto\tnet\tconsolidation\t(deconsolidation)\tof\tsponsored\tinvestment\tfunds | \t$(229) | $(425) | $(4) |
| Increase\t(decrease)\tin\tborrowings\tdue\tto\tconsolidation\tof\tVIEs | \t$363 | $406 | $412 |

# Notes	to	the	Consolidated	Financial	Statements

# 1.	Introduction	and	Basis	of	Presentation

Business.	BlackRock,	Inc.	(together,	with	its	subsidiaries,	unless	the	context	otherwise indicates,	"BlackRock"	or	the	"Company")	provides	diversified	investment	management services	to	institutional	clients,	intermediary	and	individual	investors	through	various investment	vehicles.	Investment	management	services	primarily	consist	of	the management	of	equity,	fixed	income,	multi-asset,	alternative	investment	and	cash management	products.	BlackRock	offers	its	investment	products	in	a	variety	of vehicles,	including	open-end	and	closed-end	mutual	funds,	iShares®	exchange-traded funds	("ETFs"),	collective	investment	trusts	and	separate	accounts.	In	addition, BlackRock	provides	market	risk	management,	financial	markets	advisory	and	enterprise investment	system	services	to	a	broad	base	of	clients.	Financial	markets	advisory services	include	valuation	services	relating	to	illiquid	securities,	dispositions	and workout	assignments	(including	long-term	portfolio	liquidation	assignments),	risk management	and	strategic	planning	and	execution.

At	December	31,	2013,	The	PNC	Financial	Services	Group,	Inc.	("PNC")	held	20.9%	of the	Company's	voting	common	stock	and	21.9%	of	the	Company's	capital	stock,	which includes	outstanding	common	and	nonvoting	preferred	stock.

See	Note	19,	Capital	Stock,	for	more	information	on	the	equity	ownership	of	BlackRock.

Basis	of	Presentation.	These	consolidated	financial	statements	have	been	prepared in	accordance	with	accounting	principles	generally	accepted	in	the	United	States ("GAAP")	and	include	the	accounts	of	the	Company	and	its	controlled	subsidiaries. Noncontrolling	interests	on	the	consolidated	statements	of	financial	condition	include the	portion	of	consolidated	sponsored	investment	funds	in	which	the	Company	does	not have	direct	equity	ownership.	Significant	accounts	and	transactions	between consolidated	entities	have	been	eliminated.

The	preparation	of	financial	statements	in	conformity	with	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 periods.	Actual	results	could	differ	from	those	estimates.

Certain	items	previously	reported	have	been	reclassified	to	conform	to	the	current	year presentation.

# 2.	Significant	Accounting	Policies

Cash	and	Cash	Equivalents.	Cash	and	cash	equivalents	primarily	consists	of	cash, money	market	funds	and	short-term,	highly	liquid	investments	with	original	maturities	of three	months	or	less	in	which	the	Company	is	exposed	to	market	and	credit	risk.	Cash and	cash	equivalent	balances	that	are	legally	restricted	from	use	by	the	Company	are recorded	in	other	assets	on	the	consolidated	statements	of	financial	condition.	Cash balances	maintained	by	consolidated	sponsored	investment	funds	are	not	considered legally	restricted	and	are

included	in	cash	and	cash	equivalents	on	the	consolidated	statements	of	financial condition.	Cash	balances	maintained	by	consolidated	VIEs	are	included	in	assets	of consolidated	variable	interest	entities	on	the	consolidated	statements	of	financial condition.

Investments.	Investments	in	Debt	and	Marketable	Equity	Securities.	BlackRock	holds debt	and	marketable	equity	investments,	which	pursuant	to	Accounting	Standards Codification	("ASC")	320-10,	Investments	–	Debt	and	Equity	Securities,	are	classified	as trading,	available-for-sale,	or	held-to-maturity	based	on	the	Company's	intent	to	sell	the security	or,	for	a	debt	security,	the	Company's	intent	and	ability	to	hold	the	debt	security to	maturity.

Trading	securities	are	those	investments	that	are	purchased	principally	for	the	purpose of	selling	them	in	the	near	term.	Trading	securities	are	carried	at	fair	value	on	the consolidated	statements	of	financial	condition	with	changes	in	fair	value	recorded	in nonoperating	income	(expense)	on	the	consolidated	statements	of	income	in	the	period of	the	change.

Held-to-maturity	debt	securities	are	purchased	with	the	positive	intent	and	ability	to	be held	to	maturity	and	are	recorded	at	amortized	cost	on	the	consolidated	statements	of financial	condition.

Available-for-sale	securities	are	those	securities	that	are	not	classified	as	trading	or held-to-maturity.	Available-for-sale	securities	are	carried	at	fair	value	on	the consolidated	statements	of	financial	condition	with	changes	in	fair	value	recorded	in	the accumulated	other	comprehensive	income	(loss)	component	of	stockholders'	equity	in the	period	of	the	change.	Upon	the	disposition	of	an	available-for-sale	security,	the Company	reclassifies	the	gain	or	loss	on	the	security	from	accumulated	other comprehensive	income	(loss)	to	nonoperating	income	(expense)	on	the	consolidated statements	of	income.

Equity	Method.	For	equity	investments	where	BlackRock	does	not	control	the	investee, and	where	it	is	not	the	primary	beneficiary	("PB")	of	a	VIE,	but	can	exert	significant influence	over	the	financial	and	operating	policies	of	the	investee,	the	Company	follows the	equity	method	of	accounting	in	accordance	with	ASC	323,	Investments-Equity Method	and	Joint	Ventures.	Under	the	equity	method	of	accounting,	BlackRock's	share of	the	investee's	underlying	net	income	or	loss	is	recorded	as	net	gain	(loss)	on investments	within	nonoperating	income	(expense)	and	as	other	revenue	for	certain strategic	investments	since	such	companies	are	considered	to	be	an	extension	of BlackRock's	core	business.	BlackRock's	share	of	net	income	of	the	investee	is	recorded based	upon	the	most	current	information	available	at	the	time,	which	may	precede	the date	of	the	consolidated	statement	of	financial	condition.	Distributions	received	from	the investment	reduce	the	Company's	carrying	value	of	the	investee	and	the	cost	basis	if deemed	to	be	a	return	of	capital.

Cost	Method.	For	nonmarketable	equity	investments	where	BlackRock	neither	controls nor	has	significant	influence	over	the	investee,	the	investments	are	accounted	for	using the	cost	method	of	accounting.	Under	the	cost	method,	dividends	received	from	the investment	are	recorded	as	dividend	income	within	nonoperating	income	(expense).

Impairments	of	Investments.	The	Company's	management	periodically	assesses	its equity	method,	available-for-sale,	held-to-maturity	and	cost	investments	for	impairment. If

circumstances	indicate	that	impairment	may	exist,	investments	are	evaluated	using market	values,	where	available,	or	the	expected	future	cash	flows	of	the	investment.	If the	undiscounted	expected	future	cash	flows	are	lower	than	the	Company's	carrying value	of	the	investment,	an	impairment	charge	is	recorded	in	the	consolidated statement	of	income.

When	the	fair	value	of	available-for-sale	securities	is	lower	than	cost,	the	Company evaluates	the	securities	to	determine	whether	the	impairment	is	considered	"other-than- temporary."

In	making	this	determination	for	equity	securities,	the	Company	considers,	among	other factors,	the	length	of	time	the	security	has	been	in	a	loss	position,	the	extent	to	which the	security's	market	value	is	less	than	cost,	the	financial	condition	and	near-term prospects	of	the	security's	issuer	and	the	Company's	ability	and	intent	to	hold	the security	for	a	length	of	time	sufficient	to	allow	for	recovery	of	such	unrealized	losses.	If the	impairment	is	considered	other-than-temporary,	an	impairment	charge	is	recorded in	nonoperating	income	(expense)	on	the	consolidated	statements	of	income.

In	making	this	determination	for	debt	securities,	the	Company	considers	whether:	(1)	it has	the	intent	to	sell	the	security,	(2)	it	is	more	likely	than	not	that	it	will	be	required	to sell	the	security	before	recovery	or	(3)	it	expects	to	recover	the	entire	amortized	cost basis	of	the	security.	If	the	Company	does	not	intend	to	sell	a	security	and	it	is	not	more likely	than	not	that	it	will	be	required	to	sell	the	security	but	the	security	has	suffered	a credit	loss,	the	credit	loss	will	be	bifurcated	from	the	total	impairment	and	recorded	in earnings	with	the	remaining	portion	recorded	in	accumulated	other	comprehensive income.

Consolidation.	For	investment	products	in	which	BlackRock's	voting	interest	is	less than	50%,	an	analysis	is	performed	to	determine	if	the	investment	product	is	a	VIE	or	a voting	rights	entity.

Consolidation	of	Variable	Interest	Entities.	Pursuant	to	ASC	810,	Consolidation ("ASC	810"),	certain	investment	products	for	which	the	risks	and	rewards	of	ownership are	not	directly	linked	to	voting	interests	may	be	deemed	VIEs.	BlackRock	reviews factors,	including	the	rights	of	the	equity	holders	and	obligations	of	equity	holders	to absorb	losses	or	receive	expected	residual	returns,	to	determine	if	the	investment product	is	a	VIE.	BlackRock	continuously	evaluates	such	factors	as	facts	and circumstances	change.	BlackRock	is	required	to	consolidate	a	VIE	when	it	is	deemed	to be	the	PB.

Accounting	Standards	Update	("ASU")	2010-10,	Amendments	to	Statement	167	for Certain	Investment	Funds	("ASU	2010-10"),	defers	the	application	of	Statement	of Financial	Accounting	Standards	("SFAS")	No.	167,	Amendments	to	FASB	Interpretation No.	46(R),	for	certain	investment	funds,	including	money	market	funds.

The	PB	of	a	VIE	that	does	not	meet	the	conditions	of	ASU	2010-10	is	the	enterprise	that has	the	power	to	direct	activities	of	the	entity	that	most	significantly	impact	the	entity's economic	performance	and	has	the	obligation	to	absorb	losses	or	the	right	to	receive benefits	that	potentially	could	be	significant	to	the	VIE.

The	PB	of	a	VIE	that	meets	the	conditions	of	ASU	2010-10	is	the	enterprise	that	has	a variable	interest	(or	combination	of	variable	interests,	including	those	of	related	parties) that

absorbs	the	majority	of	the	entity's	expected	losses,	receives	a	majority	of	the	entity's expected	residual	returns,	or	both.

The	Company,	as	general	partner	or	managing	member	of	certain	sponsored investment	funds,	generally	is	presumed	to	control	funds	that	are	limited	partnerships or	limited	liability	companies.	Pursuant	to	ASC	810-20,	Control	of	Partnerships	and Similar	Entities	("ASC	810-20"),	the	Company	reviews	such	investment	vehicles	to determine	if	such	a	presumption	can	be	overcome	by	determining	whether	other nonaffiliated	partners	or	members	of	the	limited	partnership	or	limited	liability	company have	the	substantive	ability	to	dissolve	(liquidate)	the	investment	vehicle,	or	to otherwise	remove	BlackRock	as	the	general	partner	or	managing	member	without cause	based	on	an	unaffiliated	simple	majority	vote,	or	have	other	substantive participating	rights.	If	the	investment	vehicle	is	not	a	VIE	and	the	presumption	of	control is	not	overcome,	BlackRock	will	consolidate	the	investment	vehicle.

Retention	of	Specialized	Accounting	Principles.	Upon	consolidation	of	certain sponsored	investment	funds,	the	Company	retains	the	specialized	accounting	principles of	the	underlying	funds	pursuant	to	ASC	810.	All	of	the	underlying	investments	held	by such	consolidated	sponsored	investment	funds	are	carried	at	fair	value,	with corresponding	changes	in	the	investments'	fair	values	reflected	in	nonoperating	income (expense)	on	the	consolidated	statements	of	income.	When	the	Company	no	longer controls	these	funds	due	to	reduced	ownership	percentage	or	other	reasons,	the	funds are	deconsolidated	and	accounted	for	under	another	accounting	method	if	the Company	still	maintains	an	investment.

Separate	Account	Assets	and	Liabilities.	Separate	account	assets	are	maintained by	BlackRock	Life	Limited,	a	wholly	owned	subsidiary	of	the	Company,	which	is	a registered	life	insurance	company	in	the	United	Kingdom,	and	represent	segregated assets	held	for	purposes	of	funding	individual	and	group	pension	contracts.	The	life insurance	company	does	not	underwrite	any	insurance	contracts	that	involve	any insurance	risk	transfer	from	the	insured	to	the	life	insurance	company.	The	separate account	assets	primarily	include	equity	securities,	debt	securities,	money	market	funds and	derivatives.	The	separate	account	assets	are	not	subject	to	general	claims	of	the creditors	of	BlackRock.	These	separate	account	assets	and	the	related	equal	and offsetting	liabilities	are	recorded	as	separate	account	assets	and	separate	account liabilities	on	the	consolidated	statements	of	financial	condition	in	accordance	with	ASC 944-80,	Financial	Services	–	Separate	Accounts.

The	net	investment	income	attributable	to	separate	account	assets	supporting	individual and	group	pension	contracts	accrues	directly	to	the	contract	owner	and	is	not	reported on	the	consolidated	statements	of	income.	While	BlackRock	has	no	economic	interest in	these	separate	account	assets	and	liabilities,	BlackRock	earns	policy	administration and	management	fees	associated	with	these	products,	which	are	included	in investment	advisory,	administration	fees	and	securities	lending	revenue	on	the consolidated	statements	of	income.

# Separate	Account	Collateral	Assets	Held	and	Liabilities	Under	Securities	Lending

Agreements.	The	Company	facilitates	securities	lending	arrangements	whereby securities	held	by	separate	account	assets	maintained	by	BlackRock	Life	Limited	are lent	to	third	parties	under	global	master	securities	lending	agreements.	In	exchange,	the Company	receives	collateral	with	minimum	values	generally	ranging	from approximately	102%	to	112%	of	the	value	of	the	securities	lent	in	order	to	reduce counterparty	risk.	The	required	collateral	value	is	calculated	on	a	daily	basis.	The	global master	securities	lending	agreements	provide	the	Company	the	right	to	request additional	collateral	or,	in	the	event	of	borrower	default,	the	right	to	liquidate	collateral. Under	the	Company's	securities	lending	arrangements,	the	Company	can	resell	or repledge	the	collateral	and	the	borrower	can	resell	or	repledge	the	loaned	securities. The	securities	lending	transactions	entered	into	by	the	Company	are	accompanied	by an	agreement	that	entitles	the	Company	to	request	the	borrower	to	return	the	securities at	any	time;	therefore,	these	transactions	are	not	reported	as	sales	under	ASC	860,

# Transfers	and	Servicing.

As	a	result	of	the	Company's	ability	to	resell	or	repledge	the	collateral,	the	Company records	on	the	consolidated	statements	of	financial	condition	the	cash	and	noncash collateral	received	under	these	arrangements	as	its	own	asset	in	addition	to	an	equal and	offsetting	collateral	liability	for	the	obligation	to	return	the	collateral.	During	2013 and	2012,	the	Company	had	not	resold	or	repledged	any	of	the	collateral	received under	these	arrangements.	At	December	31,	2013	and	2012,	the	fair	value	of	loaned securities	held	by	separate	account	assets	was	approximately	$19.7	billion	and	$21.0 billion,	respectively,	and	the	fair	value	of	the	collateral	held	under	these	securities lending	agreements	was	approximately	$21.8	billion	and	$23.0	billion,	respectively.

Deferred	Sales	Commissions.	The	Company	holds	the	rights	to	receive	certain	cash flows	from	sponsored	mutual	funds	sold	without	a	front-end	sales	charge	("back-end load	shares").	The	carrying	value	of	these	deferred	mutual	fund	commissions	is recorded	within	other	assets	on	the	consolidated	statements	of	financial	condition	and	is being	amortized	over	periods	between	one	and	six	years.	The	Company	receives distribution	fees	from	these	funds	and	contingent	deferred	sales	commissions ("CDSCs")	upon	shareholder	redemption	of	certain	back-end	load	shares	that	are recorded	within	distribution	fees	on	the	consolidated	statements	of	income.	Upon receipt	of	CDSCs,	the	Company	records	revenue	and	the	remaining	unamortized deferred	sales	commission	is	expensed.

The	Company	periodically	reviews	the	carrying	value	of	deferred	commission	assets	to determine	whether	a	significant	decline	in	the	AUM	of	these	funds	or	other	events	or circumstances	indicate	that	an	impairment	may	have	occurred.	If	indicators	of	a potential	impairment	exist,	the	Company	compares	the	carrying	value	of	the	asset	to	the estimated	future	net	undiscounted	cash	flows	related	to	the	asset.	If	such	assessments indicate	that	the	estimated	future	net	undiscounted	cash	flows	will	not	be	sufficient	to recover	the	remaining	carrying	value,	the	assets	are	adjusted	to	their	estimated	fair value.	No	such	impairments	were	recorded	for	2013,	2012	and	2011.

Property	and	Equipment.	Property	and	equipment	are	recorded	at	cost	less accumulated	depreciation.	Depreciation	is	generally	determined	by	cost	less	any

estimated	residual	value	using	the	straight-line	method	over	the	estimated	useful	lives of	the	various	classes	of	property	and	equipment.	Leasehold	improvements	are amortized	using	the	straight-line	method	over	the	shorter	of	the	estimated	useful	life	or the	remaining	lease	term.

BlackRock	develops	a	variety	of	risk	management,	investment	analytic	and	investment system	services	for	internal	use,	utilizing	proprietary	software	that	is	hosted	and maintained	by	BlackRock.	In	accordance	with	ASC	350-40,	Internal-Use	Software ("ASC	350-40"),	the	Company	capitalizes	certain	costs	incurred	in	connection	with developing	or	obtaining	software	for	internal	use.	Capitalized	software	costs	are included	within	property	and	equipment	on	the	consolidated	statements	of	financial condition	and	are	amortized,	beginning	when	the	software	project	is	put	into	production, over	the	estimated	useful	life	of	the	software	of	approximately	three	years.

Goodwill	and	Intangible	Assets.	Goodwill	represents	the	excess	cost	of	a	business acquisition	over	the	fair	value	of	the	net	identifiable	assets	acquired.	In	its	assessment of	goodwill	for	impairment,	the	Company	considers	such	factors	as	the	book	value	and market	capitalization	of	the	Company.	On	a	quarterly	basis,	the	Company	considers	if triggering	events	have	occurred	that	may	indicate	a	potential	goodwill	impairment.	If	a triggering	event	has	occurred,	the	Company	performs	assessments,	which	may	include reviews	of	significant	valuation	assumptions,	to	determine	if	goodwill	may	be	impaired. The	Company	performs	an	impairment	assessment	of	its	goodwill	at	least	annually,	as of	July	31st.

Intangible	assets	are	comprised	of	indefinite-lived	intangible	assets	and	finite-lived intangible	assets	acquired	in	a	business	acquisition.	The	value	of	contracts	to	manage assets	in	proprietary	open-end	funds	and	collective	trust	funds	and	certain	other commingled	products	without	a	specified	termination	date	is	generally	classified	as indefinite-lived	intangible	assets.	The	assignment	of	indefinite	lives	to	such	contracts primarily	is	based	upon	the	following:	(i)	the	assumption	that	there	is	no	foreseeable limit	on	the	contract	period	to	manage	these	products;	(ii)	the	Company	expects	to,	and has	the	ability	to,	continue	to	operate	these	products	indefinitely;	(iii)	the	products	have multiple	investors	and	are	not	reliant	on	a	single	investor	or	small	group	of	investors	for their	continued	operation;	(iv)	current	competitive	factors	and	economic	conditions	do not	indicate	a	finite	life;	and	(v)	there	is	a	high	likelihood	of	continued	renewal	based	on historical	experience.	In	addition,	trade	names/trademarks	are	considered	indefinite- lived	intangible	assets	when	they	are	expected	to	generate	cash	flows	indefinitely.

In	accordance	with	ASC	350,	Intangibles	–	Goodwill	and	Other	("ASC	350"),	indefinite- lived	intangible	assets	and	goodwill	are	not	amortized.	The	value	of	contracts	for separately	managed	accounts	("SMAs")	and	certain	funds	that	have	finite	lives	are amortized	over	the	expected	lives	of	the	management	contracts.

The	Company	performs	assessments	to	determine	if	any	intangible	assets	are potentially	impaired	and	whether	the	indefinite-life	and	finite-life	classifications	are	still appropriate.	The	carrying	value	of	finite-lived	management	contracts	and	their remaining	useful	lives	are	reviewed	at	least	annually	to	determine	if	circumstances	exist which	may	indicate	a	potential	impairment.	The	Company	performs	such	impairment assessments	of	its	intangible	assets

including	indefinite-lived	management	contracts	and	trade	names/trademarks,	at	least annually,	as	of	July	31st.	In	evaluating	whether	it	is	more	likely	than	not	that	the	fair value	of	indefinite-lived	intangibles	is	less	than	its	carrying	value,	BlackRock	assesses various	significant	qualitative	factors,	including	assets	under	management	("AUM"), revenue	basis	points,	projected	AUM	growth	rates,	operating	margins,	tax	rates	and discount	rates.	In	addition,	the	Company	considers	other	factors,	including (i)	macroeconomic	conditions	such	as	a	deterioration	in	general	economic	conditions, limitations	on	accessing	capital,	fluctuations	in	foreign	exchange	rates,	or	other developments	in	equity	and	credit	markets;	(ii)	industry	and	market	considerations	such as	a	deterioration	in	the	environment	in	which	an	entity	operates,	an	increased competitive	environment,	a	decline	in	market-dependent	multiples	or	metrics,	a	change in	the	market	for	an	entity's	services,	or	regulatory,	legal	or	political	developments;	and (iii)	entity-specific	events,	such	as	a	change	in	management	or	key	personnel,	overall financial	performance	and	litigation	that	could	affect	significant	inputs.

If	potential	impairment	circumstances	are	considered	to	exist,	the	Company	will	perform an	impairment	test,	using	an	undiscounted	cash	flow	analysis.	Actual	results	could	differ from	these	cash	flow	estimates,	which	could	materially	impact	the	impairment conclusion.	If	the	asset	is	determined	to	be	impaired,	the	difference	between	the carrying	value	of	the	asset	and	its	current	fair	value	would	be	recognized	as	an	expense in	the	period	in	which	the	impairment	occurs.

Noncontrolling	Interests.	The	Company	reports	noncontrolling	interests	as	equity, separate	from	the	parent's	equity,	on	the	consolidated	statements	of	financial	condition. In	addition,	the	Company's	consolidated	net	income	on	the	consolidated	statements	of income	includes	the	income	(loss)	attributable	to	noncontrolling	interest	holders	of	the Company's	consolidated	sponsored	investment	funds	and	collateralized	loan obligations	("CLOs").	Income	(loss)	attributable	to	noncontrolling	interests	is	not adjusted	for	income	taxes	for	consolidated	sponsored	investment	funds	and	CLOs	that are	treated	as	pass-through	entities	for	tax	purposes.

Classification	and	Measurement	of	Redeemable	Securities.	The	Company	includes redeemable	noncontrolling	interests	related	to	certain	consolidated	sponsored investment	funds	in	temporary	equity	on	the	consolidated	statements	of	financial condition.

Appropriated	Retained	Earnings.	Upon	the	initial	consolidation	of	CLOs,	BlackRock records	an	adjustment	to	appropriated	retained	earnings	on	the	consolidated statements	of	financial	condition	equal	to	the	difference	between	the	fair	value	of	the CLOs'	assets	and	the	fair	value	of	their	liabilities.	Such	amounts	are	recorded	as appropriated	retained	earnings	as	the	CLO	noteholders	ultimately	will	receive	the benefits	or	absorb	the	losses	associated	with	the	CLOs'	assets	and	liabilities.	The	net change	in	the	fair	value	of	the	CLOs'	assets	and	liabilities	is	recorded	as	net	income (loss)	attributable	to	nonredeemable	noncontrolling	interests	and	as	a	change	to appropriated	retained	earnings.

Treasury	Stock.	The	Company	records	common	stock	purchased	for	treasury	at	cost. At	the	date	of	subsequent	reissuance,	the	treasury	stock	account	is	reduced	by	the	cost of	such	stock	using	the	average	cost	method.

# Revenue	Recognition

Investment	Advisory,	Administration	Fees	and	Securities	Lending	Revenue.	Investment advisory	and	administration	fees	are	recognized	as	the	services	are	performed.	Such fees	are	primarily	based	on	pre-determined	percentages	of	the	market	value	of	AUM	or committed	capital.	Investment	advisory	and	administration	fees	are	affected	by changes	in	AUM,	including	market	appreciation	or	depreciation,	foreign	exchange translation	and	net	subscriptions	or	redemptions.	Investment	advisory	and administration	fees	for	investment	funds	are	shown	net	of	fees	waived	pursuant	to contractual	expense	limitations	of	the	funds	or	voluntary	waivers.

The	Company	contracts	with	third	parties	and	related	parties	for	various	mutual	fund distribution	and	shareholder	servicing	to	be	performed	on	behalf	of	certain	funds	the Company	manages.	Such	arrangements	generally	are	priced	as	a	portion	of	the management	fee	paid	by	the	fund.	In	certain	cases,	the	fund	(primarily	international funds)	takes	on	the	primary	responsibility	for	payment	for	services	such	that	the Company	bears	no	credit	risk	to	the	third	party.	The	Company	accounts	for	such retrocession	arrangements	in	accordance	with	ASC	605-45,	Revenue	Recognition	– Principal	Agent	Considerations,	and	records	its	management	fees	net	of	retrocessions. Retrocessions	for	2013,	2012	and	2011	were	$785	million,	$793	million	and	$928 million,	respectively,	and	were	reflected	net	in	investment	advisory,	administration	fees and	securities	lending	revenue	on	the	consolidated	statements	of	income.

The	Company	also	earns	revenue	by	lending	securities	as	an	agent	on	behalf	of	clients, primarily	to	brokerage	institutions.	Such	revenues	are	accounted	for	on	an	accrual basis.	The	revenue	earned	is	shared	between	the	Company	and	the	funds	or	other third-party	accounts	managed	by	the	Company	from	which	the	securities	are	borrowed.

Investment	Advisory	Performance	Fees.	The	Company	receives	investment	advisory performance	fees	or	an	incentive	allocation	from	certain	actively	managed	investment funds	and	certain	SMAs.	These	performance	fees	are	earned	upon	exceeding	specified relative	or	absolute	investment	return	thresholds.	Such	fees	are	recorded	upon completion	of	the	measurement	period,	which	varies	by	product	or	account.

The	Company	may	receive	carried	interest	from	certain	alternative	investments	upon exceeding	performance	thresholds.	BlackRock	may	be	required	to	return	all,	or	part,	of such	carried	interest	depending	upon	future	performance	of	these	investments. BlackRock	records	carried	interest	subject	to	such	clawback	provisions	in	investments, or	cash	on	the	consolidated	statements	of	financial	condition	to	the	extent	that	it	is distributed.	Carried	interest	is	realized	and	recorded	as	performance	fee	revenue	upon the	earlier	of	the	termination	of	the	investment	fund	or	when	the	likelihood	of	clawback	is mathematically	improbable.	The	Company	records	a	deferred	carried	interest	liability	to the	extent	it	receives	cash	or	capital	allocations	related	to	carried	interest	prior	to meeting	the	revenue	recognition	criteria.	At	December	31,	2013	and	2012,	the Company	had	$108	million	and	$97	million,	respectively,	of	deferred	carried	interest recorded	in	other	liabilities	on	the	consolidated	statements	of	financial	condition.

BlackRock	Solutions	and	Advisory.	BlackRock	provides	a	variety	of	risk	management, investment	analytic,	enterprise	investment	system	and	financial	markets	advisory services	to	financial	institutions,	pension	funds,	asset	managers,	foundations, consultants,	mutual	fund	sponsors,	real	estate	investment	trusts	and	government agencies.	These	services	are	provided	under	the	brand	name	BlackRock	Solutions® and	include	a	wide	array	of	risk	management	services,	valuation	of	illiquid	securities, disposition	and	workout	assignments	(including	long-term	portfolio	liquidation assignments),	strategic	planning	and	execution,	and	enterprise	investment	system outsourcing	to	clients.	Fees	earned	for	BlackRock	Solutions	and	advisory	services	are recorded	as	services	are	performed	and	are	determined	using	some,	or	all,	of	the following	methods:	(i)	percentages	of	various	attributes	of	advisory	AUM	or	value	of positions	on	the	Aladdin®	platform,	(ii)	fixed	fees	and	(iii)	performance	fees	if contractual	thresholds	are	met.	The	fees	earned	for	BlackRock	Solutions	and	advisory services	are	recorded	in	BlackRock	Solutions	and	advisory	on	the	consolidated statements	of	income.

Other	Revenue.	The	Company	earns	fees	for	transition	management	services comprised	of	commissions	from	acting	as	an	introducing	broker-dealer	in	buying	and selling	securities	on	behalf	of	the	Company's	customers.	Commissions	related	to transition	management	services	are	recorded	on	a	trade-date	basis	as	securities transactions	occur	and	are	reflected	in	other	revenue	on	the	consolidated	statements	of income.

The	Company	earns	commissions	revenue	upon	the	sale	of	unit	trusts	and	Class	A mutual	funds.	Revenue	is	recorded	at	the	time	of	the	sale	of	the	product.

Other	revenue	also	includes	equity	method	investment	earnings	related	to	certain strategic	investments	and	marketing	fees	earned	for	services	to	distribute	iPath® products,	which	are	exchange-traded	notes	issued	by	Barclays.

Stock-based	Compensation.	The	Company	applies	ASC	718-10,	Compensation	– Stock	Compensation	("ASC	718-10"),	which	establishes	standards	for	the	accounting	of transactions	in	which	an	entity	obtains	employee	services	in	share-based	payment transactions.	Entities	are	required	to	measure	the	cost	of	employee	services	received	in exchange	for	an	award	of	equity	instruments	based	on	the	grant-date	fair	value	of	the award.	The	compensation	cost	is	recognized	over	the	period	during	which	an	employee is	required	to	provide	service	(usually	the	vesting	period)	in	exchange	for	the	stock- based	award.

The	Company	measures	the	grant-date	fair	value	of	restricted	stock	units	("RSUs") using	the	Company's	share	price	on	the	date	of	grant.	For	employee	share	options	and instruments	with	market	conditions,	the	Company	uses	pricing	models.	If	an	equity award	is	modified	after	the	grant	date,	incremental	compensation	cost	is	recognized	for an	amount	equal	to	the	excess	of	the	fair	value	of	the	modified	award	over	the	fair	value of	the	original	award	immediately	before	the	modification.	Awards	under	the	Company's stock-based	compensation	plans	vest	over	various	periods.	Compensation	cost	is recorded	by	the	Company	on	a	straight-line	basis	over	the	requisite	service	period	for each	separate	vesting	portion	of	the	award	as	if	the	award	is,	in-substance,	multiple awards.	Compensation	cost	is	reduced	by	the	number	of	awards	expected	to	be forfeited	prior	to

vesting.	Forfeiture	estimates	generally	are	derived	using	historical	forfeiture	information, where	available,	and	are	reviewed	for	reasonableness	at	least	quarterly.

The	Company	amortizes	the	grant-date	fair	value	of	stock-based	compensation	awards made	to	retirement-eligible	employees	over	the	requisite	service	period.	Upon notification	of	retirement,	the	Company	accelerates	the	unamortized	portion	of	the award	over	the	contractually	required	retirement	notification	period,	if	applicable.

Distribution	and	Servicing	Costs.	Distribution	and	servicing	costs	include	payments to	third	parties,	primarily	associated	with	distribution	and	servicing	of	client	investments in	certain	BlackRock	products.	Distribution	and	servicing	costs	are	expensed	when incurred.

Direct	Fund	Expenses.	Direct	fund	expenses,	which	are	expensed	as	incurred, primarily	consist	of	third-party	nonadvisory	expenses	incurred	by	BlackRock	related	to certain	funds	for	the	use	of	certain	index	trademarks,	reference	data	for	certain	indices, custodial	services,	fund	administration,	fund	accounting,	transfer	agent	services, shareholder	reporting	services,	audit	and	tax	services	as	well	as	other	fund-related expenses	directly	attributable	to	the	nonadvisory	operations	of	the	fund.

Leases.	The	Company	accounts	for	its	operating	leases,	which	may	include	escalation clauses,	in	accordance	with	ASC	840-10,	Leases.	The	Company	expenses	the	lease payments	associated	with	operating	leases	evenly	during	the	lease	term	(including rent-free	periods)	commencing	when	the	Company	obtains	control	over	the	leased property.

Foreign	Exchange.	Monetary	assets	and	liabilities	of	foreign	subsidiaries	having	non- U.S.	dollar	functional	currencies	are	translated	at	exchange	rates	at	the	date	of	the consolidated	statements	of	financial	condition.	Nonmonetary	assets	and	liabilities	of foreign	subsidiaries	having	non-U.S.	dollar	functional	currencies	are	translated	at historical	exchange	rates.	Revenue	and	expenses	are	translated	at	average	exchange rates	during	the	period.	Gains	or	losses	resulting	from	translating	foreign	currency financial	statements	into	U.S.	dollars	are	included	in	accumulated	other	comprehensive income,	a	separate	component	of	stockholders'	equity,	on	the	consolidated	statements of	financial	condition.	Gains	or	losses	resulting	from	foreign	currency	transactions	are included	in	general	and	administration	expense	on	the	consolidated	statements	of income.	For	2013,	2012	and	2011,	the	gains	(losses)	from	foreign	currency	transactions were	immaterial.

Income	Taxes.	The	Company	accounts	for	income	taxes	under	the	asset	and	liability method	prescribed	by	ASC	740-10,	Income	Taxes	("ASC	740-10").	Deferred	income tax	assets	and	liabilities	are	recognized	for	the	future	tax	consequences	attributable	to temporary	differences	between	the	financial	statement	carrying	amounts	of	existing assets	and	liabilities	and	their	respective	tax	bases	using	currently	enacted	tax	rates	in effect	for	the	year	in	which	the	differences	are	expected	to	reverse.	The	effect	of	a change	in	tax	rates	on	deferred	income	tax	assets	and	liabilities	is	recognized	in consolidated	statements	of	income	in	the	period	that	includes	the	enactment	date.

Management	periodically	assesses	the	recoverability	of	its	deferred	income	tax	assets based	upon	expected	future	earnings,	taxable	income	in	prior	carryback	years,	future

deductibility	of	the	asset,	changes	in	applicable	tax	laws	and	other	factors.	If management	determines	that	it	is	not	more	likely	than	not	that	the	deferred	tax	asset	will be	fully	recoverable	in	the	future,	a	valuation	allowance	will	be	established	for	the difference	between	the	asset	balance	and	the	amount	expected	to	be	recoverable	in	the future.	This	allowance	will	result	in	additional	income	tax	expense.	Further,	the Company	records	its	income	taxes	receivable	and	payable	based	upon	its	estimated income	tax	position.

Excess	tax	benefits	related	to	stock-based	compensation	are	recognized	as	additional paid-in	capital	and	are	reflected	as	financing	cash	flows	on	the	consolidated	statements of	cash	flows.	If	the	Company	does	not	have	additional	paid-in	capital	credits (cumulative	tax	benefits	recorded	to	additional	paid-in	capital),	the	Company	will	record an	expense	for	any	deficit,	or	shortfall,	between	the	recorded	tax	benefit	and	tax	return benefit.	At	December	31,	2013	and	2012,	BlackRock	had	excess	additional	paid-in capital	credits	to	absorb	potential	future	deficits	between	recorded	tax	benefits	and	tax return	benefits.

Earnings	per	Share	("EPS").	Basic	EPS	is	calculated	by	dividing	net	income applicable	to	common	shareholders	by	the	weighted-average	number	of	shares outstanding	during	the	period.	Diluted	EPS	includes	the	determinants	of	basic	EPS	and common	stock	equivalents	outstanding	during	the	period.	Diluted	EPS	is	computed using	the	treasury	stock	method.

Due	to	the	similarities	in	terms	between	BlackRock's	nonvoting	participating	preferred stock	and	the	Company's	common	stock,	the	Company	considers	its	nonvoting participating	preferred	stock	to	be	a	common	stock	equivalent	for	purposes	of	EPS calculations.	As	such,	the	Company	has	included	the	outstanding	nonvoting participating	preferred	stock	in	the	calculation	of	average	basic	and	diluted	shares outstanding.

Prior	to	2013,	the	Company	calculated	EPS	pursuant	to	the	two-class	method	as defined	in	ASC	260-10,	Earnings	per	Share	("ASC	260-10"),	which	specifies	that	all outstanding	unvested	share-based	payment	awards	that	contain	rights	to	nonforfeitable dividends	or	dividend	equivalents	are	considered	participating	securities	and	should	be included	in	the	computation	of	EPS.	The	Company's	participating	securities	consisted	of its	unvested	share-based	payment	awards	that	contained	rights	to	nonforfeitable dividends	or	dividend	equivalents.	The	dilutive	effect	of	participating	securities	was calculated	under	the	more	dilutive	of	either	the	treasury	stock	method	or	the	two-class method.	The	Company's	remaining	participating	securities	vested	in	January	2013.

Business	Segments.	The	Company's	management	directs	BlackRock's	operations	as one	business,	the	asset	management	business.	As	such,	the	Company	operates	in	one business	segment	as	defined	in	ASC	280-10,	Segment	Reporting	("ASC	280-10").

Business	Combinations.	The	Company	accounts	for	business	combinations	in accordance	with	the	requirements	of	ASC	805,	Business	Combinations	("ASC	805"). The	fundamental	requirement	of	ASC	805	is	that	the	acquisition	method	of	accounting (the	purchase	method)	be	used	for	all	business	combinations	and	for	an	acquirer	to	be identified	for	each	business	combination.	The	provisions	of	ASC	805	define	the acquirer,	establish	the	acquisition	date	and	define	transactions	that	qualify	as	business combinations.

Additionally,	the	requirements	of	ASC	805	provide	guidance	for	measuring	the	fair	value of	assets	acquired,	liabilities	assumed	and	any	noncontrolling	interest	in	the	acquiree, provide	guidance	for	the	measurement	of	fair	value	in	a	step	acquisition,	provide guidance	for	recognizing	assets	acquired	and	liabilities	assumed	subject	to contingencies,	provide	guidance	on	recognition	and	measurement	of	contingent consideration	and	require	that	acquisition-related	costs	of	the	acquirer	generally	be expensed	as	incurred.	Reversal	of	valuation	allowances	related	to	acquired	deferred tax	assets	and	changes	to	liabilities	for	unrecognized	tax	benefits	related	to	tax positions	assumed	in	business	combinations	subsequent	to	the	adoption	of	the requirements	of	ASC	805,	will	affect	the	income	tax	provision	in	the	period	of	reversal	or change.

Hierarchy	of	Fair	Value	Inputs.	The	provisions	of	ASC	820,	Fair	Value	Measurement ("ASC	820"),	establish	a	hierarchy	that	prioritizes	inputs	to	valuation	techniques	used	to measure	fair	value	and	require	companies	to	disclose	the	fair	value	of	their	financial instruments	according	to	the	fair	value	hierarchy	(i.e.,	Level	1,	2	and	3	inputs,	as defined).	The	fair	value	hierarchy	gives	the	highest	priority	to	quoted	prices	(unadjusted) in	active	markets	for	identical	assets	or	liabilities	and	the	lowest	priority	to	unobservable inputs.

Assets	and	liabilities	measured	and	reported	at	fair	value	are	classified	and	disclosed	in one	of	the	following	categories:

# Level	1	Inputs:

Quoted	prices	(unadjusted)	in	active	markets	for	identical	assets	or	liabilities	at	the reporting	date.

•	Level	1	assets	may	include	listed	mutual	funds	(including	those	accounted	for under	the	equity	method	of	accounting	as	these	mutual	funds	are	investment companies	that	have	publicly	available	net	asset	values	("NAVs"),	which	in accordance	with	GAAP,	are	calculated	under	fair	value	measures	and	the changes	in	fair	values	are	equal	to	the	earnings	of	such	funds),	ETFs,	listed equities	and	certain	exchange-traded	derivatives.

Quoted	prices	for	similar	assets	or	liabilities	in	active	markets;	quoted	prices	for identical	or	similar	assets	or	liabilities	that	are	not	active;	quotes	from	pricing	services or	brokers	for	which	the	Company	can	determine	that	orderly	transactions	took	place at	the	quoted	price	or	that	the	inputs	used	to	arrive	at	the	price	are	observable;	and inputs	other	than	quoted	prices	that	are	observable,	such	as	models	or	other	valuation methodologies.	As	a	practical	expedient,	the	Company	relies	on	the	NAV	(or	its equivalent)	of	certain	investments	as	their	fair	value.

•	Level	2	assets	may	include	debt	securities,	bank	loans,	short-term	floating-rate notes	and	asset-backed	securities,	securities	held	within	consolidated	hedge funds,	certain	equity	method	limited	partnership	interests	in	hedge	funds	valued based	on	NAV	(or	its	equivalent)	where	the	Company	has	the	ability	to	redeem	at the	measurement	date	or	within	the	near	term	without	redemption	restrictions, restricted	public	securities	valued	at	a	discount,	as	well	as	over-the-counter derivatives,	including	interest	and	inflation	rate	swaps	and	foreign	currency exchange	contracts	that	have	inputs	to	the	valuations	that	generally	can	be corroborated	by	observable	market	data.

Unobservable	inputs	for	the	valuation	of	the	asset	or	liability,	which	may	include nonbinding	broker	quotes.	Level	3	assets	include	investments	for	which	there	is	little, if	any,	market	activity.	These	inputs	require	significant	management	judgment	or estimation.	Certain	investments	that	are	valued	using	a	NAV	(or	its	equivalent)	and are	subject	to	current	redemption	restrictions	that	will	not	be	lifted	in	the	near	term	are included	in	Level	3.

•	Level	3	assets	may	include	general	and	limited	partnership	interests	in	private equity	funds,	funds	of	private	equity	funds,	real	estate	funds,	hedge	funds	and funds	of	hedge	funds,	direct	private	equity	investments	held	within	consolidated funds,	bank	loans	and	bonds.

•	Level	3	liabilities	include	borrowings	of	consolidated	collateralized	loan	obligations valued	based	upon	nonbinding	single-broker	quotes.

•	Level	3	inputs	include	BlackRock	capital	accounts	for	its	partnership	interests	in various	alternative	investments,	including	distressed	credit	hedge	funds,	real estate	and	private	equity	funds,	which	may	be	adjusted	by	using	the	returns	of certain	market	indices.

Valuation	Techniques.	The	fair	values	of	certain	Level	3	assets	and	liabilities	were determined	using	various	methodologies	as	appropriate,	including	NAVs	of	underlying investments,	third-party	pricing	vendors,	broker	quotes	and	market	and	income approaches.	Such	quotes	and	modeled	prices	are	evaluated	for	reasonableness through	various	procedures,	including	due	diligence	reviews	of	third-party	pricing vendors,	variance	analyses,	consideration	of	the	current	market	environment	and	other analytical	procedures.

As	a	practical	expedient,	the	Company	relies	on	NAV	as	the	fair	value	for	certain investments.	The	inputs	to	value	these	investments	may	include	BlackRock	capital accounts	for	its	partnership	interests	in	various	alternative	investments,	including distressed	credit	hedge	funds,	real	estate	and	private	equity	funds,	which	may	be adjusted	by	using	the	returns	of	certain	market	indices.	The	various	partnerships generally	are	investment	companies,	which	record	their	underlying	investments	at	fair value	based	on	fair	value	policies	established	by	management	of	the	underlying	fund. Fair	value	policies	at	the	underlying	fund	generally	require	the	fund	to	utilize pricing/valuation	information	from	third-party	sources,	including	independent	appraisals. However,	in	some	instances,	current	valuation	information	for	illiquid	securities	or securities	in	markets	that	are	not	active	may	not	be	available	from	any	third-party source	or	fund	management	may	conclude	that	the	valuations	that	are	available	from third-party	sources	are	not	reliable.	In	these	instances,	fund	management	may	perform model-based	analytical	valuations	that	may	be	used	as	an	input	to	value	these investments.

A	significant	amount	of	inputs	used	to	value	equity,	debt	securities	and	bank	loans	is sourced	from	well-recognized	third-party	pricing	vendors.	Generally,	prices	obtained from	pricing	vendors	are	categorized	as	Level	1	inputs	for	identical

securities	traded	in	active	markets	and	as	Level	2	for	other	similar	securities	if	the vendor	uses	observable	inputs	in	determining	the	price.	Annually,	BlackRock's	internal valuation	committee	or	other	designated	groups	review	both	the	valuation methodologies,	including	the	general	assumptions	and	methods	used	to	value	various asset	classes,	and	operational	processes	with	these	vendors.	On	a	quarterly	basis, meetings	are	held	with	key	vendors	to	identify	any	significant	changes	to	the	vendors' processes.

Fair	Value	Option.	ASC	825-10,	Financial	Instruments	("ASC	825-10"),	provides	a	fair value	option	election	that	allows	companies	an	irrevocable	election	to	use	fair	value	as the	initial	and	subsequent	accounting	measurement	attribute	for	certain	financial	assets and	liabilities.	ASC	825-10	permits	entities	to	elect	to	measure	eligible	financial	assets and	liabilities	at	fair	value	on	an	ongoing	basis.	Unrealized	gains	and	losses	on	items	for which	the	fair	value	option	has	been	elected	are	reported	in	earnings.	The	decision	to elect	the	fair	value	option	is	determined	on	an	instrument-by-instrument	basis,	which must	be	applied	to	an	entire	instrument,	and	not	only	specified	risks,	specific	cash	flows, or	portions	of	that	instrument,	and	is	irrevocable	once	elected.	Assets	and	liabilities measured	at	fair	value	pursuant	to	ASC	825-10	are	required	to	be	reported	separately from	those	instruments	measured	using	another	accounting	method.

Derivative	Instruments	and	Hedging	Activities.	ASC	815-10,	Derivatives	and	Hedging ("ASC	815-10"),	establishes	accounting	and	reporting	standards	for	derivative instruments,	including	certain	derivatives	embedded	in	other	contracts	and	for	hedging activities.	ASC	815-10	generally	requires	an	entity	to	recognize	all	derivatives	as	either assets	or	liabilities	on	the	consolidated	statements	of	financial	condition	and	to	measure those	investments	at	fair	value.

The	Company	does	not	use	derivative	financial	instruments	for	trading	or	speculative purposes.	The	Company	may	use	derivative	financial	instruments	primarily	for purposes	of	hedging:	(i)	exposures	to	fluctuations	in	foreign	currency	exchange	rates	of certain	assets	and	liabilities,	(ii)	market	exposures	for	certain	seed	investments	and (iii)	future	cash	flows	on	floating-rate	notes.	The	Company	may	also	use	derivatives within	its	separate	account	assets,	which	are	segregated	funds	held	for	purposes	of funding	individual	and	group	pension	contracts.	In	addition,	certain	consolidated sponsored	investment	funds	may	also	invest	in	derivatives	as	a	part	of	their	investment strategy.

Changes	in	the	fair	value	of	the	Company's	derivative	financial	instruments	are generally	recognized	in	earnings	and,	where	applicable,	are	offset	by	the corresponding	gain	or	loss	on	the	related	foreign-denominated	assets	or	liabilities	or hedged	investments,	on	the	consolidated	statements	of	income.

# Accounting	Pronouncements	Adopted	in	2013

# Amendments	to	Accumulated	Other	Comprehensive	Income	Disclosures.	On

February	5,	2013,	the	Financial	Accounting	Standards	Board	("FASB")	issued Accounting	Standards	Update	("ASU")	2013-02,	Reporting	of	Amounts	Reclassified	Out of	Accumulated	Other	Comprehensive	Income	("ASU	2013-02"),	which	added	new disclosure	requirements	for	items	reclassified	out	of	accumulated	other	comprehensive income	("AOCI").	See	Note	18,	Accumulated	Other	Comprehensive	Income	(Loss).

# Disclosures	About	Offsetting	Assets	and	Liabilities.	On	December	16,	2011,	the

FASB	issued	ASU	2011-11,	Disclosures	About	Offsetting	Assets	and	Liabilities ("ASU	2011-11"),	which	created	new	disclosure	requirements	about	the	nature	of	an entity's	rights	of	setoff	and	related	arrangements	associated	with	its	financial instruments	and	derivative	instruments.	On	January	31,	2013,	the	FASB	issued	ASU 2013-01,	Clarifying	the	Scope	of	Disclosures	about	Offsetting	Assets	and	Liabilities ("ASU	2013-01"),	that	provides	clarification	about	which	instruments	and	transactions are	subject	to	ASU	2011-11.	The	adoption	of	ASU	2011-11	and	ASU	2013-01	on January	1,	2013	was	not	material	to	the	consolidated	financial	statements.

# Recent	Accounting	Pronouncements	Not	Yet	Adopted

Cumulative	Translation	Adjustment.	In	March	2013,	the	FASB	issued	ASU	2013-05,

Parent's	Accounting	for	the	Cumulative	Translation	Adjustment	upon	Derecognition	of Certain	Subsidiaries	or	Groups	of	Assets	within	a	Foreign	Entity	or	of	an	Investment	in a	Foreign	Entity	("ASU	2013-05").	ASU	2013-05	addresses	the	accounting	for	the cumulative	translation	adjustment	when	a	parent	either	sells	a	part	or	all	of	its investment	in	a	foreign	entity	or	no	longer	holds	a	controlling	financial	interest	in	a subsidiary	or	group	of	assets	that	is	a	nonprofit	activity	or	a	business	within	a	foreign entity.	ASU	2013-05	became	effective	for	the	Company	on	January	1,	2014.	The Company	does	not	believe	the	adoption	of	ASU	2013-05	will	have	a	material	impact	on the	consolidated	financial	statements.

Investment	Company	Guidance.	In	June	2013,	the	FASB	issued	ASU	2013-08, Financial	Services	—	Investment	Companies:	Amendments	to	the	Scope, Measurement,	and	Disclosure	Requirements	("ASU	2013-08").	ASU	2013-08	amends the	current	criteria	for	an	entity	to	qualify	as	an	investment	company,	creates	new disclosure	requirements	and	amends	the	measurement	criteria	for	certain	interests	in other	investment	companies.	ASU	2013-08	became	effective	for	the	Company	on January	1,	2014.	The	Company	does	not	believe	the	adoption	of	ASU	2013-08	will	have a	material	impact	on	the	consolidated	financial	statements.

Presentation	of	an	Unrecognized	Tax	Benefit.	In	July	2013,	the	FASB	issued	ASU 2013-11,	Presentation	of	an	Unrecognized	Tax	Benefit	When	a	Net	Operating	Loss Carryforward,	a	Similar	Tax	Loss,	or	a	Tax	Credit	Carryforward	Exists	("ASU	2013- 11").	ASU	2013-11	became	effective	for	the	Company	on	January	1,	2014.	The Company	does	not	believe	the	adoption	of	ASU	2013-11	will	have	a	material	impact	on the	consolidated	financial	statements.

A	summary	of	the	carrying	value	of	total	investments	is	as	follows:

|  | December	31, | December	31, |
| :--- | :--- | :--- |
| (in\tmillions) | 2013 | 2012 |
| Available-for-sale\tinvestments | $183 | $158 |
| Held-to-maturity\tinvestments | 83 | 112 |
| Trading\tinvestments: |  |  |
| Consolidated\tsponsored |  |  |
| investment\tfunds | 385 | 123 |
| Other\tequity\tand\tdebt\tsecurities | 43 | 94 |
| Deferred\tcompensation\tplan |  |  |
| mutual\tfunds | 58 | 53 |
| Total\ttrading\tinvestments | 486 | 270 |
| Other\tinvestments: |  |  |
| Consolidated\tsponsored\ninvestment\tfunds | 441 | 401 |
| Equity\tmethod\tinvestments | 697 | 595 |
| Deferred\tcompensation\tplan |  |  |
| hedge\tfund\tequity\tmethod |  |  |
| investments | 39 | 9 |
| Cost\tmethod\tinvestments(1) | 119 | 120 |
| Carried\tinterest | 103 | 85 |
| Total\tother\tinvestments | 1,399 | 1,210 |
| Total\tinvestments | $2,151 | $1,750 |

# (1) Amounts	primarily	include	Federal	Reserve	Bank	Stock

At	December	31,	2013,	the	Company	consolidated	$826	million	of	investments	held	by consolidated	sponsored	investment	funds	(excluding	VIEs)	of	which	$385	million	and $441	million	were	classified	as	trading	investments	and	other	investments,	respectively. At	December	31,	2012,	the	Company	consolidated	$524	million	of	investments	held	by consolidated	sponsored	investment	funds	(excluding	VIEs)	of	which	$123	million	and $401	million	were	classified	as	trading	investments	and	other	investments,	respectively.

# Available-for-Sale	Investments

A	summary	of	the	cost	and	carrying	value	of	investments	classified	as	available-for-sale is	as	follows:

| (in	millions) |  | Gross	Unrealized |  | Carrying |
| :--- | :--- | :--- | :--- | :--- |
| At\tDecember\t31,\t2013 | Cost | Gains | Losses | Value |
| Equity\tsecurities\tof |  |  |  |  |
| sponsored\tinvestment |  |  |  |  |
| funds | $180 | $4 | $(4) | $180 |
| Other\tsecurities | 1 | 2 | — | 3 |
| Total\tavailable-for-sale\ninvestments | $181 | $6 | $(4) | $183 |
| At\tDecember\t31,\t2012 |  |  |  |  |
| Equity\tsecurities\tof |  |  |  |  |
| sponsored\tinvestment |  |  |  |  |
| funds | $142 | $14 | $(1) | $155 |
| Other\tsecurities | 2 | 1 | — | 3 |
| Total\tavailable-for-sale\ninvestments | $144 | $15 | $(1) | $158 |

Available-for-sale	investments	primarily	included	seed	investments	in	BlackRock sponsored	investment	mutual	funds.

A	summary	of	sale	activity	in	available-for-sale	securities	during	2013,	2012	and	2011	is shown	below.

# Other	Investments

A	summary	of	the	cost	and	carrying	value	of	other	investments	is	as	follows:

# Trading	Investments

A	summary	of	the	cost	and	carrying	value	of	trading	investments	is	as	follows:

|  | December	31,	2013 | December	31,	2013 | December	31,	2012 | December	31,	2012 |
| :--- | :--- | :--- | :--- | :--- |
|  | Carrying | Carrying | Carrying | Carrying |
| (in\tmillions) | Cost | Value | Cost | Value |
| Trading\tinvestments: |  |  |  |  |
| Deferred\tcompensation |  |  |  |  |
| plan\tmutual\tfunds | $49 | $58 | $46 | $53 |
| Equity/Multi-asset\tmutual |  |  |  |  |
| funds | 174 | 184 | 154 | 162 |
| Debt\tsecurities/fixed |  |  |  |  |
| income\tmutual\tfunds:\nCorporate\tdebt | 128 | 128 | 44 | 44 |
| Government\tdebt | 121 | 116 | 11 | 11 |
| Total\ttrading\tinvestments | $\t472 | $\t486 | $\t255 | $\t270 |

At	December	31,	2013,	trading	investments	included	$172	million	of	equity	securities and	$213	million	of	debt	securities	held	by	consolidated	sponsored	investment	funds, $58	million	of	certain	deferred	compensation	plan	mutual	fund	investments	and	$43 million	of	equity	and	debt	securities.

At	December	31,	2012,	trading	investments	included	$73	million	of	equity	securities	and $50	million	of	debt	securities	held	by	consolidated	sponsored	investment	funds,	$53 million	of	certain	deferred	compensation	plan	mutual	fund	investments	and	$94	million of	equity	and	debt	securities.

Consolidated	sponsored	investment	funds	include	third-party	private	equity	funds,	direct investments	in	private	companies	and	third-party	hedge	funds	held	by	BlackRock sponsored	investment	funds.

Equity	method	investments	primarily	include	BlackRock's	direct	investment	in	certain BlackRock	sponsored	investment	funds.	See	Note	11,	Other	Assets,	for	information	on the	Company's	investment	in	PennyMac	Financial	Services,	Inc.	("PennyMac"),	which is	included	in	other	assets	on	the	consolidated	statements	of	financial	condition.

Cost	method	investments	include	nonmarketable	securities,	including	Federal	Reserve Bank	("FRB")	stock,	which	is	held	for	regulatory	purposes	and	is	restricted	from	sale.	At December	31,	2013	and	2012,	there	were	no	indicators	of	impairment	on	these investments.

Carried	interest	represents	allocations	to	BlackRock's	general	partner	capital	accounts from	certain	funds.	These	balances	are	subject	to	change	upon	cash	distributions, additional	allocations	or	reallocations	back	to	limited	partners	within	the	respective funds.

The	Company	consolidates	certain	sponsored	investment	funds	primarily	because	it	is deemed	to	control	such	funds.	The	investments	owned	by	these	consolidated sponsored	investment	funds	are	classified	as	trading	or	other	investments.	The following	table	presents	the	balances	related	to	these	consolidated	funds	that	were included	on	the	consolidated	statements	of	financial	condition	as	well	as	BlackRock's net	interest	in	these	funds:

|  | December	31, | December	31, |
| :--- | :--- | :--- |
| (in\tmillions) | 2013 | 2012 |
| Cash\tand\tcash\tequivalents | $114 | $133 |
| Investments: |  |  |
| Trading\tinvestments | 385 | 123 |
| Other\tinvestments | 441 | 401 |
| Other\tassets | 20 | 25 |
| Other\tliabilities | (39) | (65) |
| Noncontrolling\tinterests | (189) | (187) |
| BlackRock's\tnet\tinterests\tin\nconsolidated\tinvestment\tfunds | $732 | $430 |

BlackRock's	total	exposure	to	consolidated	sponsored	investment	funds	represents	the value	of	its	economic	ownership	interest	in	these	sponsored	investment	funds. Valuation	changes	associated	with	investments	held	at	fair	value	by	these	consolidated investment	funds	are	reflected	in	nonoperating	income	(expense)	and	partially	offset	in net	income	(loss)	attributable	to	noncontrolling	interests	for	the	portion	not	attributable	to BlackRock.

In	addition,	at	December	31,	2013	and	2012,	several	consolidated	CLOs	and	one sponsored	investment	fund,	which	were	deemed	to	be	VIEs,	were	excluded	from	the balances	in	the	table	above	as	the	balances	for	these	investment	products	are	reported separately	on	the	consolidated	statements	of	financial	condition.	See	Note	6,	Variable Interest	Entities,	for	further	discussion	on	these	consolidated	investment	products.

The	Company	may	not	be	readily	able	to	access	cash	and	cash	equivalents	held	by consolidated	sponsored	investment	funds	to	use	in	its	operating	activities.	In	addition, the	Company	may	not	be	readily	able	to	sell	investments	held	by	consolidated sponsored	investment	funds	in	order	to	obtain	cash	for	use	in	the	Company's operations.

# 5.	Fair	Value	Disclosures

# Assets	and	liabilities	measured	at	fair	value	on	a	recurring	basis	and	other	assets	not	held	at	fair	value

|  | Active |  | Significant |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- |
|  | Markets\tfor | Significant\tOther | Unobservable | Other\tAssets |  |
| December\t31,\t2013\n(in\tmillions) | Identical\tAssets\n(Level\t1) | Observable\tInputs\n(Level\t2) | Inputs\n(Level\t3) | Not\tHeld\tat\tFair\nValue(1) | December\t31,\n2013 |
| Assets: |  |  |  |  |  |
| Investments |  |  |  |  |  |
| Available-for-sale: |  |  |  |  |  |
| Equity\tsecurities\tof\tsponsored\tinvestment\tfunds | $180 | $— | $— | $— | $180 |
| Other\tsecurities | — | 3 | — | — | 3 |
| Total\tavailable-for-sale | 180 | 3 | — | — | 183 |
| Held-to-maturity\tdebt\tsecurities | — | — | — | 83 | 83 |
| Trading: |  |  |  |  |  |
| Deferred\tcompensation\tplan\tmutual\tfunds | 58 | — | — | — | 58 |
| Equity/Multi-asset\tmutual\tfunds | 184 | — | — | — | 184 |
| Debt\tsecurities\t/\tfixed\tincome\tmutual\tfunds | 31 | 213 | — | — | 244 |
| Total\ttrading | 273 | 213 | — | — | 486 |
| Other\tinvestments: |  |  |  |  |  |
| Consolidated\tsponsored\tinvestment\tfunds: |  |  |  |  |  |
| Hedge\tfunds\t/\tFunds\tof\tfunds | — | 135 | 24 | — | 159 |
| Private\t/\tpublic\tequity(2) | 5 | 13 | 223 | 41 | 282 |
| Total\tconsolidated\tsponsored\tinvestment\tfunds | 5 | 148 | 247 | 41 | 441 |
| Equity\tmethod: |  |  |  |  |  |
| Hedge\tfunds\t/\tFunds\tof\thedge\tfunds | — | 177 | 99 | 63 | 339 |
| Private\tequity\tinvestments | — | — | 101 | — | 101 |
| Real\testate\tfunds | — | 20 | 98 | 7 | 125 |
| Fixed\tincome\tmutual\tfunds | 113 | — | — | — | 113 |
| Equity/Multi-asset,\talternative\tmutual\tfunds | 19 | — | — | — | 19 |
| Total\tequity\tmethod | 132 | 197 | 298 | 70 | 697 |
| Deferred\tcompensation\tplan\tequity\tmethod |  |  |  |  |  |
| investments | — | 10 | 29 | — | 39 |
| Cost\tmethod\tinvestments | — | — | — | 119 | 119 |
| Carried\tinterest | — | — | — | 103 | 103 |
| Total\tinvestments | 590 | 571 | 574 | 416 | 2,151 |
| Separate\taccount\tassets | 113,382 | 40,841 | — | 890 | 155,113 |
| Separate\taccount\tcollateral\theld\tunder\tsecurities\tlending |  |  |  |  |  |
| agreements:\nEquity\tsecurities | 20,856 | — | — | — | 20,856 |
| Debt\tsecurities | — | 932 | — | — | 932 |
| Total\tseparate\taccount\tcollateral\theld\tunder\tsecurities |  |  |  |  |  |
| lending\tagreements | 20,856 | 932 | — | — | 21,788 |
| Other\tassets(3) | — | 39 | — | — | 39 |
| Assets\tof\tconsolidated\tVIEs: |  |  |  |  |  |
| Bank\tloans\tand\tother\tassets | — | 2,047 | 129 | 19 | 2,195 |
| Bonds | — | 71 | 35 | — | 106 |
| Private\t/\tpublic\tequity(4) | — | 10 | 14 | — | 24 |
| Total\tassets\tof\tconsolidated\tVIEs | — | 2,128 | 178 | 19 | 2,325 |
| Total | $\t134,828 | $\t44,511 | $752 | $\t1,325 | $\t181,416 |
| Liabilities: |  |  |  |  |  |
| Borrowings\tof\tconsolidated\tVIEs | $— | $— | $2,369 | $— | $2,369 |
| Separate\taccount\tcollateral\tliabilities\tunder\tsecurities |  |  |  |  |  |
| lending\tagreements | 20,856 | 932 | — | — | 21,788 |
| Other\tliabilities(5) | 18 | 4 | 42 | — | 64 |
| Total | $20,874 | $936 | $\t2,411 | $— | $24,221 |

(1) Amounts	are	comprised	of	investments	held	at	cost	or	amortized	cost,	carried	interest	and	certain	equity	method	investments,	which	include	sponsored	investment	funds	and	other	assets,	which	in	accordance	with GAAP	are	not	accounted	for	under	a	fair	value	measure.	In	accordance	with	GAAP,	certain	equity	method	investees	do	not	account	for	both	their	financial	assets	and	liabilities	under	fair	value	measures;	therefore,	the Company's	investment	in	such	equity	method	investees	may	not	represent	fair	value.

(2) Level	3	amounts	include	$195	million	and	$28	million	of	underlying	third-party	private	equity	funds	and	direct	investments	in	private	equity	companies	held	by	private	equity	funds,	respectively.

(3) Amount	includes	company-owned	and	split-dollar	life	insurance	policies	and	unrealized	gains	on	forward	foreign	currency	exchange	contracts.

(4) Level	3	amounts	include	$14	million	of	underlying	third-party	private	equity	funds	held	by	a	private	equity	fund.

(5) Amounts	include	a	credit	default	swap	(see	Note	7,	 Derivatives	and	Hedging,	for	more	information),	securities	sold	short	within	consolidated	sponsored	investment	funds	and	contingent	liabilities	related	to	the acquisitions	of	Credit	Suisse's	ETF	franchise	and	MGPA.

|  | in	Active |  | Significant | Other	Assets |  |
| :--- | :--- | :--- | :--- | :--- | :--- |
|  | Markets\tfor | Significant\tOther | Unobservable | Not |  |
| December\t31,\t2012\n(in\tmillions) | Identical\tAssets\n(Level\t1) | Observable\tInputs\n(Level\t2) | Inputs\n(Level\t3) | Held\tat\tFair\nValue(1) | December\t31,\n2012 |
| Assets: |  |  |  |  |  |
| Investments |  |  |  |  |  |
| Available-for-sale: |  |  |  |  |  |
| Equity\tsecurities\tof\tsponsored\tinvestment\tfunds | $155 | $— | $1 | $— | $156 |
| Other\tsecurities | — | 2 | — | — | 2 |
| Total\tavailable-for-sale | 155 | 2 | 1 | — | 158 |
| Held-to-maturity\tdebt\tsecurities | — | — | — | 112 | 112 |
| Trading: |  |  |  |  |  |
| Deferred\tcompensation\tplan\tmutual\tfunds | 53 | — | — | — | 53 |
| Equity/Multi-asset\tmutual\tfunds | 159 | 3 | — | — | 162 |
| Debt\tsecurities\t/\tfixed\tincome\tmutual\tfunds | 5 | 50 | — | — | 55 |
| Total\ttrading | 217 | 53 | — | — | 270 |
| Other\tinvestments: |  |  |  |  |  |
| Consolidated\tsponsored\tinvestment\tfunds: |  |  |  |  |  |
| Hedge\tfunds\t/\tFunds\tof\tfunds | 3 | 39 | 73 | — | 115 |
| Private\t/\tpublic\tequity(2) | 10 | 10 | 266 | — | 286 |
| Total\tconsolidated\tsponsored\tinvestment\tfunds | 13 | 49 | 339 | — | 401 |
| Equity\tmethod: |  |  |  |  |  |
| Hedge\tfunds\t/\tFunds\tof\thedge\tfunds | — | 61 | 161 | 39 | 261 |
| Private\tequity\tinvestments | — | — | 90 | — | 90 |
| Real\testate\tfunds | — | 19 | 88 | 15 | 122 |
| Fixed\tincome\tmutual\tfunds | 46 | — | — | — | 46 |
| Equity/Multi-asset,\talternative\tmutual\tfunds | 76 | — | — | — | 76 |
| Total\tequity\tmethod | 122 | 80 | 339 | 54 | 595 |
| Deferred\tcompensation\tplan\thedge\tfund\tequity |  |  |  |  |  |
| method\tinvestments | — | 9 | — | — | 9 |
| Cost\tmethod\tinvestments | — | — | — | 120 | 120 |
| Carried\tinterest | — | — | — | 85 | 85 |
| Total\tinvestments | 507 | 193 | 679 | 371 | 1,750 |
| Separate\taccount\tassets | 95,514 | 38,392 | 2 | 860 | 134,768 |
| Separate\taccount\tcollateral\theld\tunder\tsecurities\tlending |  |  |  |  |  |
| agreements:\nEquity\tsecurities | 21,273 | — | — | — | 21,273 |
| Debt\tsecurities | — | 1,748 | — | — | 1,748 |
| Total\tseparate\taccount\tcollateral\theld\tunder\tsecurities |  |  |  |  |  |
| lending\tagreements | 21,273 | 1,748 | — | — | 23,021 |
| Other\tassets(3) | — | 12 | — | — | 12 |
| Assets\tof\tconsolidated\tVIEs: |  |  |  |  |  |
| Bank\tloans | — | 2,004 | 106 | — | 2,110 |
| Bonds | — | 78 | 46 | — | 124 |
| Private\t/\tpublic\tequity(4) | 2 | 6 | 22 | — | 30 |
| Total\tassets\tof\tconsolidated\tVIEs | 2 | 2,088 | 174 | — | 2,264 |
| Total | $\t117,296 | $\t42,433 | $855 | $\t1,231 | $\t161,815 |
| Liabilities: |  |  |  |  |  |
| Borrowings\tof\tconsolidated\tVIEs | $— | $— | $2,402 | $— | $2,402 |
| Separate\taccount\tcollateral\tliabilities\tunder\tsecurities |  |  |  |  |  |
| lending\tagreements | 21,273 | 1,748 | — | — | 23,021 |
| Other\tliabilities(5) | 15 | 5 | — | — | 20 |
| Total | $21,288 | $1,753 | $\t2,402 | $— | $25,443 |

(3) Amount	includes	company-owned	and	split-dollar	life	insurance	policies.

(4) Level	3	amounts	include	$20	million	and	$2	million	of	underlying	third-party	private	equity	funds	and	direct	investments	in	private	equity	companies	held	by	a	private	equity	fund.

(5) Amounts	include	a	credit	default	swap	(see	Note	7,	 Derivatives	and	Hedging,	for	more	information)	and	securities	sold	short	within	consolidated	sponsored	investment	funds.

Level	3	Assets.	Level	3	investments	of	$574	million	and	$679	million	at	December	31, 2013	and	2012,	respectively,	primarily	related	to	equity	method	investments	and consolidated	sponsored	investment	funds.	Level	3	assets	within	investments,	except	for direct	investments	in	private	equity	companies	held	by	private	equity	funds	described below,	were	primarily	valued	based	upon	NAVs	received	from	internal	and	third-party fund	managers.

Direct	investments	in	private	equity	companies	held	by	private	equity	funds	totaled	$28 million	and	$56	million	at	December	31,	2013	and	2012,	respectively.	Direct investments	in	private	equity	companies	may	be	valued	using	the	market	approach	or the	income	approach,	or	a	combination	thereof,	and	were	valued	based	on	an assessment	of	each	underlying	investment,	incorporating	evaluation	of	additional significant	third-party	financing,	changes	in	valuations	of	comparable	peer	companies, the	business	environment	of	the	companies,	market	indices,	assumptions	relating	to appropriate	risk	adjustments	for	nonperformance	and	legal	restrictions	on	disposition, among	other	factors.	The	fair	value	derived	from	the	methods	used	are	evaluated	and weighted,	as	appropriate,	considering	the	reasonableness	of	the	range	of	values indicated.	Under	the	market	approach,	fair	value	may	be	determined	by	reference	to multiples	of	market-comparable	companies	or	transactions,	including	earnings	before interest,	taxes,	depreciation	and	amortization	("EBITDA")	multiples.	Under	the	income approach,	fair	value	may	be	determined	by	discounting	the	expected	cash	flows	to	a single	present	value	amount	using	current	market	expectations	about	those	future amounts.	Unobservable	inputs	used	in	a

discounted	cash	flow	model	may	include	projections	of

operating	performance	generally	covering	a	five-year	period	and	a	terminal	value	of	the private	equity	direct	investment.	For	securities	utilizing	the	discounted	cash	flow valuation	technique,	a	significant	increase	(decrease)	in	the	discount	rate,	risk	premium or	discount	for	lack	of	marketability	in	isolation	could	result	in	a	significantly	lower (higher)	fair	value	measurement.	For	securities	utilizing	the	market	comparable companies	valuation	technique,	a	significant	increase	(decrease)	in	the	EBITDA multiple	in	isolation	could	result	in	a	significantly	higher	(lower)	fair	value	measurement.

Level	3	assets	recorded	within	separate	account	assets	include	single-broker nonbinding	quotes	for	fixed	income	securities	and	equity	securities	that	have unobservable	inputs	due	to	certain	corporate	actions.

Level	3	assets	of	consolidated	VIEs	include	bank	loans	and	bonds	valued	based	on single-broker	nonbinding	quotes	and	direct	private	equity	investments	and	private	equity funds	valued	based	upon	internal	as	well	as	third-party	fund	manager	valuations,	which may	be	adjusted	by	using	the	returns	of	certain	market	indices.

Level	3	Liabilities.	Level	3	borrowings	of	consolidated	VIEs	include	CLO	borrowings valued	based	upon	single-broker	nonbinding	quotes.

Level	3	other	liabilities	include	contingent	liabilities	related	to	the	acquisitions	of	Credit Suisse's	ETF	franchise	and	MGPA,	which	were	valued	based	upon	discounted	cash flow	analyses	using	unobservable	market	data	inputs.

Changes	in	Level	3	Assets	and	Liabilities	Measured	at	Fair	Value	on	a	Recurring	Basis	for	2013

|  |  | and |  |  |  |  |  |  | Total	net |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  |  | unrealized |  |  |  |  |  |  | unrealized |
|  |  | gains |  |  |  |  |  |  | gains |
|  |  | (losses) |  |  |  |  |  |  | (losses) |
|  |  | in |  |  | Issuances | Transfers | Transfers |  | included |
|  | December\t31, | earnings |  | Sales\tand | and\tother | into | out\tof | December\t31, | in |
| (in\tmillions) | 2012 | and\tOCI | Purchases | maturities | settlements(1) | Level\t3 | Level\t3 | 2013 | earnings(2) |
| Assets: |  |  |  |  |  |  |  |  |  |
| Investments: |  |  |  |  |  |  |  |  |  |
| Available-for-sale: |  |  |  |  |  |  |  |  |  |
| Equity\tsecurities\tof\tsponsored |  |  |  |  |  |  |  |  |  |
| investment\tfunds | $1 | $— | $— | $— | $(1) | $— | $— | $— | $— |
| Consolidated\tsponsored\tinvestment |  |  |  |  |  |  |  |  |  |
| funds: |  |  |  |  |  |  |  |  |  |
| Hedge\tfunds\t/\tFunds\tof\tfunds | 73 | 8 | 12 | (19) | (34) | — | (16) | 24 | 4 |
| Private\tequity | 266 | 37 | 16 | (82) | — | — | (14) | 223 | \t25 |
| Equity\tmethod: |  |  |  |  |  |  |  |  |  |
| Hedge\tfunds\t/\tFunds\tof\thedge |  |  |  |  |  |  |  |  |  |
| funds | 161 | 16 | 7 | (11) | (74) | — | — | 99 | 9 |
| Private\tequity\tinvestments | 90 | 21 | 14 | (10) | (14) | — | — | 101 | 21 |
| Real\testate\tfunds | 88 | 20 | 7 | — | (17) | — | — | 98 | 20 |
| Deferred\tcompensation\tplan\tequity |  |  |  |  |  |  |  |  |  |
| method\tinvestments | — | — | — | — | 29 | — | — | 29 | — |
| Total\tLevel\t3\tinvestments | 679 | 102 | 56 | (122) | (111) | — | (30) | 574 | 79 |
| Separate\taccount\tassets: | 2 | — | — | (2) | — | — | — | — | n/a(3) |
| Assets\tof\tconsolidated\tVIEs: |  |  |  |  |  |  |  |  |  |
| Bank\tloans | 106 | — | 109 | (60) | \t\t\t\t16 | 117 | (159) | 129 |  |
| Bonds | 46 | 1 | 4 | (16) | — | — | — | 35 |  |
| Private\tequity | 22 | 2 | — | (7) | — | — | (3) | 14 |  |
| Funds\tof\thedge\tfunds | — | — | 134 | — | (134) | — | — | — |  |
| Total\tLevel\t3\tassets\tof\tconsolidated |  |  |  |  |  |  |  |  |  |
| VIEs | 174 | 3 | 247 | (83) | (118) | 117 | (162) | 178 | n/a(4) |
| Total\tLevel\t3\tassets | $855 | $\t105 | $\t303 | $(207) | $(229) | $\t117 | $(192) | $752 | $79 |
| Liabilities: |  |  |  |  |  |  |  |  |  |
| Borrowings\tof\tconsolidated\tVIEs | $2,402 | $(14) | $— | $— | $(47) | $— | $— | $2,369 | n/a(4) |
| Other\tliabilities | — | — | — | — | 42 | — | — | 42 | — |
| Total\tLevel\t3\tliabilities | $\t2,402 | $(14) | $— | $\t\t\t\t— | $(5) | $— | $\t\t— | $\t2,411 |  |

n/a —	not	applicable

(1) Amounts	include	distributions	from	equity	method	investees,	repayments	of	borrowings	of	consolidated	VIEs,	loans	and	borrowings	related	to	the	consolidation	of	one	additional	CLO,	elimination	of	investment	related	to a	deconsolidation	of	a	consolidated	VIE	and	a	reclassification	of	an	investment	from	a	consolidated	sponsored	investment	fund	to	an	equity	method	investment	due	to	a	change	in	ownership	percentage.	Amounts	also include	the	acquisition	of	deferred	compensation	plan	equity	method	investments	and	contingent	liabilities	related	to	the	acquisitions	of	Credit	Suisse's	ETF	franchise	and	MGPA.

(2) Earnings	attributable	to	the	change	in	unrealized	gains	(losses)	relating	to	assets	still	held	at	the	reporting	date.

(3) The	net	investment	income	attributable	to	separate	account	assets	accrues	directly	to	the	contract	owners	and	is	not	reported	on	the	consolidated	statements	of	income.

(4) The	net	gain	(loss)	on	consolidated	VIEs	is	solely	attributable	to	noncontrolling	interests	on	the	consolidated	statements	of	income.

|  |  | and |  |  |  |  |  |  | Total	net |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  |  | unrealized |  |  |  |  |  |  | unrealized |
|  |  | gains |  |  |  |  |  |  | gains |
|  |  | (losses) |  |  |  |  |  |  | (losses) |
|  |  | in |  |  | Issuances | Transfers | Transfers |  | included |
|  | December\t31, | earnings |  | Sales\tand | and\tother | into | out\tof | December\t31, | in |
| (in\tmillions) | 2011 | and\tOCI | Purchases | maturities | settlements(1) | Level\t3 | Level\t3 | 2012 | earnings(2) |
| Assets: |  |  |  |  |  |  |  |  |  |
| Investments: |  |  |  |  |  |  |  |  |  |
| Available-for-sale: |  |  |  |  |  |  |  |  |  |
| Equity\tsecurities\tof\tsponsored |  |  |  |  |  |  |  |  |  |
| investment\tfunds | $1 | $— | $— | $— | $— | $— | $— | $1 | $\t\t\t\t— |
| Consolidated\tsponsored\tinvestment |  |  |  |  |  |  |  |  |  |
| funds: |  |  |  |  |  |  |  |  |  |
| Hedge\tfunds\t/\tFunds\tof\tfunds | 22 | — | 37 | (6) | — | 25 | (5) | 73 | (1) |
| Private\tequity | 313 | 27 | 32 | (85) | (15) | — | (6) | 266 | 24 |
| Equity\tmethod: |  |  |  |  |  |  |  |  |  |
| Hedge\tfunds\t/\tFunds\tof\thedge |  |  |  |  |  |  |  |  |  |
| funds | 193 | 38 | — | — | (70) | — | — | 161 | 32 |
| Private\tequity\tinvestments | 85 | 6 | 11 | — | (12) | — | — | 90 | 6 |
| Real\testate\tfunds | 88 | 12 | 21 | (7) | (7) | — | (19) | 88 | 12 |
| Total\tLevel\t3\tinvestments | 702 | 83 | 101 | (98) | (104) | 25 | (30) | 679 | 73 |
| Separate\taccount\tassets | 10 | 5 | 11 | (62) | — | 48 | (10) | 2 | n/a(3) |
| Assets\tof\tconsolidated\tVIEs: |  |  |  |  |  |  |  |  |  |
| Bank\tloans | 83 | 4 | 68 | (44) | 7 | 101 | (113) | 106 |  |
| Bonds | 40 | 4 | 2 | \t\t\t\t\t— | — | — | — | 46 |  |
| Private\tequity | 27 | 4 | — | (9) | — | — | — | 22 |  |
| Total\tLevel\t3\tassets\tof\tconsolidated |  |  |  |  |  |  |  |  |  |
| VIEs | 150 | 12 | 70 | (53) | 7 | 101 | (113) | 174 | n/a(4) |
| Total\tLevel\t3\tassets | $862 | $\t100 | $\t182 | $(213) | $(97) | $\t174 | $(153) | $855 | $73 |
| Liabilities: |  |  |  |  |  |  |  |  |  |
| Borrowings\tof\tconsolidated\tVIEs | $\t1,574 | $(93) | $— | $— | $\t735 | $— | $\t\t\t\t\t— | $\t2,402 | n/a(4) |

(1) Amount	primarily	includes	distributions	from	equity	method	investees,	and	proceeds	from	and	repayments	of	borrowings	of	consolidated	VIEs.

Realized	and	Unrealized	Gains	(Losses)	for	Level	3	Assets	and	Liabilities.	Realized	and unrealized	gains	(losses)	recorded	for	Level	3	assets	and	liabilities	are	reported	in nonoperating	income	(expense)	on	the	consolidated	statements	of	income.	A	portion	of net	income	(loss)	for	consolidated	investments	and	all	of	the	net	income	(loss)	for consolidated	VIEs	are	allocated	to	noncontrolling	interests	to	reflect	net	income	(loss) not	attributable	to	the	Company.

Transfers	in	and/or	out	of	Levels.	Transfers	in	and/or	out	of	levels	are	reflected	when significant	inputs,	including	market	inputs	or	performance	attributes,	used	for	the	fair value	measurement	become	observable/unobservable,	or	when	the	Company determines	it	has	the	ability,	or	no	longer	has	the	ability,	to	redeem,	in	the	near	term, certain

investments	that	the	Company	values	using	a	NAV	(or	a	capital	account),	or	when	the carrying	value	of	certain	equity	method	investments	no	longer	represents	fair	value	as determined	under	valuation	methodologies.

Separate	Account	Assets.	In	2012,	there	were	$48	million	of	transfers	of	equity securities	into	Level	3	from	Level	1,	primarily	due	to	market	inputs	no	longer	being considered	observable.

In	2012,	there	were	$10	million	of	transfers	out	of	Level	3	to	Level	1	primarily	related	to equity	securities	held	within	separate	accounts.	The	transfers	were	primarily	due	to availability	of	observable	market	inputs.

Assets	of	Consolidated	VIEs.	In	2013,	there	were	$159	million	of	transfers	out	of	Level	3 to	Level	2	related	to	bank	loans.	In	addition,	in	2013,	there	were	$117	million	of transfers	into	Level	3	from	Level	2	related	to	bank	loans.	These	transfers	in	and	out	of levels	were	primarily	due	to	availability/unavailability	of	observable	market	inputs, including	inputs	from	pricing	vendors	and	brokers.

In	2012,	there	were	$113	million	of	transfers	out	of	Level	3	to	Level	2	related	to	bank loans.	In	addition,	in	2012,	there	were	$101	million	of	transfers	into	Level	3	from	Level	2 related	to	bank	loans.	The	transfers	in	and	out	of	levels	were	primarily	due	to availability/	unavailability	of	observable	market	inputs,	including	inputs	from	pricing vendors	and	brokers.

Consolidated	Sponsored	Investment	Funds.	In	2013,	there	were	$12	million	of	transfers out	of	Level	1	to	Level	2	related	to	consolidated	private	equity	funds.	These	transfers were	due	to	a	direct	investment	in	a	public	company	valued	at	a	discount	due	to restrictions	on	sale.

Significant	Other	Settlements.	In	2013	and	2012,	there	were	$105	million	and	$89 million,	respectively,	of	distributions	from	equity	method	investees	categorized	in	Level 3.

In	2013,	other	settlements	included	$134	million	related	to	a	deconsolidation	of	a consolidated	fund	of	hedge	funds,	which	was	previously	classified	as	a	VIE.	This	fund was	deconsolidated	during	the	second	quarter	of	2013	due	to	the	granting	of	additional substantive	rights	to	unaffiliated	investors	of	the	fund.

In	2013,	other	settlements	included	$363	million	of	borrowings	of	consolidated	VIEs related	to	a	consolidation	of	one	additional	CLO.

In	2013,	there	was	a	$28	million	reclassification	of	a	Level	3	investment	from	a consolidated	sponsored	investment	fund	to	an	equity	method	investment	due	to	a change	in	BlackRock's	ownership	percentage.

In	2013,	issuances	and	other	settlements	included	$29	million	of	acquired	Level	3 deferred	compensation	plan	equity	method	investments.

During	2012,	other	settlements	included	$1,011	million	of	proceeds	from	borrowings	of consolidated	CLOs.

Disclosures	of	Fair	Value	for	Financial	Instruments	Not	Held	at	Fair	Value.	At	December	31,	2013	and	2012,	the	fair	value	of	the	Company's	financial	instruments	not	held	at	fair	value are	categorized	in	the	table	below:

|  | December	31,	2013 | December	31,	2013 | December	31,	2012 | December	31,	2012 |  |
| :--- | :--- | :--- | :--- | :--- | :--- |
|  | Carrying | Estimated | Carrying | Estimated | Fair\tValue |
| (in\tmillions) | Amount | Fair\tValue | Amount | Fair\tValue | Hierarchy |
| Financial\tAssets: |  |  |  |  |  |
| Cash\tand\tcash\tequivalents | $\t4,390 | $\t4,390 | $\t4,606 | $\t4,606 | Level\t1(1) |
| Accounts\treceivable | 2,247 | 2,247 | 2,250 | 2,250 | Level\t1(2) |
| Cash\tand\tcash\tequivalents\tof\tconsolidated\tVIEs | 161 | 161 | 297 | 297 | Level\t1(1) |
| Financial\tLiabilities: |  |  |  |  |  |
| Accounts\tpayable\tand\taccrued\tliabilities | 1,084 | 1,084 | 1,055 | 1,055 | Level\t1(2) |
| Short-term\tborrowings | — | — | 100 | 100 | Level\t1(2) |
| Long-term\tborrowings | 4,939 | 5,284 | 5,687 | 6,275 | Level\t2(3) |

(1) Cash	and	cash	equivalents	are	carried	at	either	cost	or	amortized	cost,	which	approximates	fair	value	due	to	their	short-term	maturities.	At	December	31,	2013	and	2012,	approximately	$64	million	and	$98	million, respectively,	of	money	market	funds	were	recorded	within	cash	and	cash	equivalents	on	the	consolidated	statements	of	financial	condition.	Money	market	funds	are	valued	based	on	quoted	market	prices,	or	$1.00	per share,	which	generally	is	the	NAV	of	the	fund.	At	December	31,	2013	and	2012,	approximately	$114	million	and	$133	million,	respectively,	related	to	cash	and	cash	equivalents	held	by	consolidated	sponsored investment	funds.

(2) The	carrying	amounts	of	accounts	receivable,	accounts	payable	and	accrued	liabilities	and	short-term	borrowings	approximate	fair	value	due	to	their	short-term	nature.

(3) Long-term	borrowings	are	recorded	at	amortized	cost.	The	fair	value	of	the	long-term	borrowings,	including	the	current	portion	of	long-term	borrowings,	is	estimated	using	market	prices	at	the	end	of	December	2013 and	2012,	respectively.	See	Note	12,	Borrowings,	for	the	fair	value	of	each	of	the	Company's	long-term	borrowings.

# Investments	in	Certain	Entities	that	Calculate	Net	Asset	Value	Per	Share

As	a	practical	expedient	to	value	certain	investments	that	do	not	have	a	readily	determinable	fair	value	and	have	attributes	of	an	investment	company,	the	Company	relies	on	NAV	as the	fair	value.	The	following	table	lists	information	regarding	all	investments	that	use	a	fair	value	measurement	to	account	for	both	their	financial	assets	and	financial	liabilities	in	their calculation	of	a	NAV	per	share	(or	equivalent).

n/r –	not	redeemable

(1) Comprised	of	equity	method	investments,	which	include	investment	companies,	which	account	for	their	financial	assets	and	most	financial	liabilities	under	fair	value	measures;	therefore,	the	Company's	investment	in such	equity	method	investees	approximates	fair	value.

(a) This	category	includes	the	underlying	third-party	private	equity	funds	within	consolidated	BlackRock	sponsored	private	equity	funds	of	funds.	The	fair	values	of	the	investments	in	the	third-party	funds	have	been estimated	using	capital	accounts	representing	the	Company's	ownership	interest	in	each	fund	in	the	portfolio	as	well	as	other	performance	inputs.	These	investments	are	not	subject	to	redemption;	however,	for	certain funds,	the	Company	may	sell	or	transfer	its	interest,	which	may	need	approval	by	the	general	partner	of	the	underlying	funds.	Due	to	the	nature	of	the	investments	in	this	category,	the	Company	reduces	its	investment by	distributions	that	are	received	through	the	realization	of	the	underlying	assets	of	the	funds.	It	is	estimated	that	the	underlying	assets	of	these	funds	will	be	liquidated	over	a	weighted-average	period	of	approximately seven	years	at	both	December	31,	2013	and	2012.	The	total	remaining	unfunded	commitments	to	other	third-party	funds	were	$23	million	and	$32	million	at	December	31,	2013	and	2012,	respectively.	The	Company was	contractually	obligated	to	fund	$30	million	at	both	December	31,	2013	and	2012	to	the	consolidated	funds.

(b) This	category	includes	consolidated	funds	of	hedge	funds	that	invest	in	multiple	strategies	to	diversify	risks.	The	fair	values	of	the	investments	have	been	estimated	using	the	NAV	of	the	fund's	ownership	interest	in partners'	capital	of	each	fund	in	the	portfolio.	Certain	of	the	underlying	funds	can	be	redeemed	as	long	as	there	are	no	restrictions	in	place.	At	December	31,	2013	and	2012,	the	underlying	funds	that	are	currently restricted	from	redemptions	within	one	year	will	become	redeemable	in	approximately	12	to	24	months.	This	category	also	includes	a	consolidated	offshore	feeder	fund	that	invests	in	a	master	fund	with	multiple alternative	investment	strategies.	The	fair	value	of	this	investment	has	been	estimated	using	the	NAV	of	the	master	offshore	fund	held	by	the	feeder	fund.	The	investment	is	currently	subject	to	restrictions	in	place	by the	underlying	master	fund.

(c) This	category	includes	hedge	funds	and	funds	of	hedge	funds	that	invest	primarily	in	equities,	fixed	income	securities,	distressed	credit	and	mortgage	instruments	and	other	third-party	hedge	funds.	The	fair	values	of the	investments	have	been	estimated	using	the	NAV	of	the	Company's	ownership	interest	in	partners'	capital.	It	was	estimated	that	the	investments	in	the	funds	that	are	not	subject	to	redemption	will	be	liquidated	over a	weighted-average	period	of	approximately	three	and	five	years	at	December	31,	2013	and	2012,	respectively.

(d) This	category	includes	several	private	equity	funds	that	initially	invest	in	nonmarketable	securities	of	private	companies,	which	ultimately	may	become	public	in	the	future.	The	fair	values	of	these	investments	have	been estimated	using	capital	accounts	representing	the	Company's	ownership	interest	in	the	funds	as	well	as	other	performance	inputs.	The	Company's	investment	in	each	fund	is	not	subject	to	redemption	and	is	normally returned	through	distributions	as	a	result	of	the	liquidation	of	the	underlying	assets	of	the	private	equity	funds.	It	was	estimated	that	the	investments	in	these	funds	will	be	liquidated	over	a	weighted-average	period	of approximately	five	years	at	both	December	31,	2013	and	2012.

(e) This	category	includes	several	real	estate	funds	that	invest	directly	in	real	estate	and	real	estate	related	assets.	The	fair	values	of	the	investments	have	been	estimated	using	capital	accounts	representing	the Company's	ownership	interest	in	the	funds.	A	majority	of	the	Company's	investments	are	not	subject	to	redemption	or	are	not	currently	redeemable	and	is	normally	returned	through	distributions	as	a	result	of	the liquidation	of	the	underlying	assets	of	the	real	estate	funds.	It	is	estimated	that	the	investments	in	these	funds	not	subject	to	redemptions	will	be	liquidated	over	a	weighted-average	period	of	approximately	seven	years at	December	31,	2013	and	eight	years	at	December	31,	2012.

(f) This	category	includes	investments	in	several	real	estate	funds	and	certain	hedge	funds	that	invest	in	energy	and	health	science	related	equity	securities.	The	fair	values	of	the	investments	in	this	category	have	been estimated	using	capital	accounts	representing	the	Company's	ownership	interest	in	partners'	capital	as	well	as	performance	inputs.	The	investments	in	hedge	funds	will	be	redeemed	upon	settlement	of	certain	deferred compensation	liabilities.	The	real	estate	investments	are	not	subject	to	redemption;	however,	distributions	as	a	result	of	the	liquidation	of	the	underlying	assets	will	be	used	to	settle	certain	deferred	compensation liabilities	over	time.

(g) This	category	includes	the	underlying	third-party	private	equity	funds	within	one	consolidated	BlackRock	sponsored	private	equity	fund	of	funds.	The	fair	values	of	the	investments	in	the	third-party	funds	have	been estimated	using	capital	accounts	representing	the	Company's	ownership	interest	in	each	fund	in	the	portfolio	as	well	as	other	performance	inputs.	These	investments	are	not	subject	to	redemption;	however,	for	certain funds	the	Company	may	sell	or	transfer	its	interest,	which	may	need	approval	by	the	general	partner	of	the	underlying	third-party	funds.	Due	to	the	nature	of	the	investments	in	this	category,	the	Company	reduces	its investment	by	distributions	that	are	received	through	the	realization	of	the	underlying	assets	of	the	funds.	It	is	estimated	that	the	underlying	assets	of	these	funds	will	be	liquidated	over	a	weighted-average	period	of approximately	two	years	at	December	31,	2013	and	three	years	at	December	31,	2012.	Total	remaining	unfunded	commitments	to	other	third-party	funds	were	not	material	at	both	December	31,	2013	and	2012,	which commitments	are	required	to	be	funded	by	capital	contributions	from	noncontrolling	interest	holders.

(h) This	category	includes	consolidated	offshore	feeder	funds	that	invest	in	master	funds	with	multiple	equity	strategies	to	diversify	risks.	The	fair	values	of	the	investments	in	this	category	have	been	estimated	using	the NAV	of	master	offshore	funds	held	by	the	feeder	funds.	Investments	in	this	category	generally	can	be	redeemed	at	any	time,	as	long	as	there	are	no	restrictions	in	place	by	the	underlying	master	funds.

Fair	Value	Option.	Upon	the	initial	consolidation	of	certain	CLOs,	the	Company	elected to	adopt	the	fair	value	option	provisions	for	eligible	assets	and	liabilities,	including	bank loans	and	borrowings	of	the	CLOs	to	mitigate	accounting	mismatches	between	the carrying	value	of	the	assets	and	liabilities	and	to	achieve	operational	simplification.	To the	extent	there	is	a	difference	between	the	change	in	fair	value	of	the	assets	and liabilities,	the	difference	will	be	reflected	as	net	income	(loss)	attributable	to nonredeemable	noncontrolling	interests	on	the	consolidated	statements	of	income	and offset	by	a	change	in	appropriated	retained	earnings	on	the	consolidated	statements	of financial	condition.

The	following	table	summarizes	information	related	to	those	assets	and	liabilities selected	for	fair	value	accounting	at	December	31,	2013	and	2012:

|  | December	31, | December	31, |
| :--- | :--- | :--- |
| (in\tmillions) | 2013 | 2012 |
| CLO\tBank\tLoans: |  |  |
| Aggregate\tprincipal\tamounts |  |  |
| outstanding | $2,181 | $2,124 |
| Fair\tvalue | 2,176 | 2,110 |
| Aggregate\tunpaid\tprincipal |  |  |
| balance\tin\texcess\tof\t(less\tthan) |  |  |
| fair\tvalue | $5 | $14 |
| Unpaid\tprincipal\tbalance\tof\tloans |  |  |
| more\tthan\t90\tdays\tpast\tdue | $14 | $4 |
| Aggregate\tfair\tvalue\tof\tloans\tmore |  |  |
| than\t90\tdays\tpast\tdue | 9 | — |
| Aggregate\tunpaid\tprincipal |  |  |
| balance\tin\texcess\tof\tfair\tvalue |  |  |
| for\tloans\tmore\tthan\t90\tdays |  |  |
| past\tdue | $5 | $4 |
| CLO\tBorrowings: |  |  |
| Aggregate\tprincipal\tamounts |  |  |
| outstanding | $2,455 | $2,535 |
| Fair\tvalue | $\t2,369 | $\t2,402 |

At	December	31,	2013,	the	principal	amounts	outstanding	of	the	borrowings	issued	by the	CLOs	mature	between	2016	and	2025.

During	2013,	2012	and	2011,	the	change	in	fair	value	of	the	bank	loans	and	bonds	held by	the	CLOs	resulted	in	a	$153	million,	a	$154	million	and	a	$57	million	gain, respectively,	which	were	offset	by	a	$117	million,	a	$166	million	and	a	$68	million	loss, respectively,	from	the	change	in	fair	value	of	the	CLO	borrowings.

The	net	gains	(losses)	were	recorded	in	net	gain	(loss)	on	consolidated	VIEs	on	the consolidated	statements	of	income.

The	change	in	fair	value	of	the	assets	and	liabilities	included	interest	income	and expense,	respectively.

# 6.	Variable	Interest	Entities

In	the	normal	course	of	business,	the	Company	is	the	manager	of	various	types	of sponsored	investment	vehicles,	including	collateralized	debt	obligations	("CDOs")/CLOs and	sponsored	investment	funds,	which	may	be	considered	VIEs.	The	Company receives	advisory	fees	and/or	other	incentive-related	fees	for	its	services	and	may	from time	to	time	own	equity	or	debt	securities	or	enter	into	derivatives	with	the	vehicles, each	of	which	are	considered	variable	interests.	The	Company	enters	into	these variable	interests	principally	to	address	client	needs	through	the	launch	of	such investment	vehicles.	The	VIEs	are	primarily	financed	via	capital	contributed	by	equity and	debt	holders.	The	Company's	involvement	in	financing	the	operations	of	the	VIEs	is generally	limited	to	its	equity	interests.

In	order	to	determine	whether	the	Company	is	the	PB	of	a	VIE,	management	must make	significant	estimates	and	assumptions	of	probable	future	cash	flows	of	the VIEs.	Assumptions	made	in	such	analyses	may	include,	but	are	not	limited	to,	market prices	of	securities,	market	interest	rates,	potential	credit	defaults	on	individual securities	or	default	rates	on	a	portfolio	of	securities,	prepayments,	realization	of	gains, liquidity	or	marketability	of	certain	securities,	discount	rates	and	the	probability	of certain	other	outcomes.	See	Note	2,	Significant	Accounting	Policies,	for	more information.

Consolidated	VIEs.	Consolidated	VIEs	included	CLOs	in	which	BlackRock	did	not have	an	investment;	however,	BlackRock,	as	the	collateral	manager,	was	deemed	to have	both	the	power	to	control	the	activities	of	the	CLOs	and	the	right	to	receive	benefits that	could	potentially	be	significant	to	the	CLOs.	In	addition,	BlackRock	was	the	PB	of one	investment	fund	because	it	absorbed	the	majority	of	the	variability	due	to	its	de- facto	related-party	relationships	with	other

partners	in	the	fund.	The	assets	of	these	VIEs	are	not	available	to	creditors	of	the Company.	In	addition,	the	investors	in	these	VIEs	have	no	recourse	to	the	credit	of	the Company.	At	December	31,	2013	and	2012,	the	following	balances	related	to	VIEs were	consolidated	on	the	consolidated	statements	of	financial	condition:

|  | December	31, | December	31, |
| :--- | :--- | :--- |
| (in\tmillions) | 2013 | 2012 |
| Assets\tof\tconsolidated\tVIEs: |  |  |
| Cash\tand\tcash\tequivalents | $161 | $297 |
| Bank\tloans | \t2,176 | \t2,110 |
| Bonds | 106 | 124 |
| Other\tinvestments\tand\tother |  |  |
| assets | 43 | 30 |
| Total\tbank\tloans,\tbonds,\tother |  |  |
| investments\tand\tother\tassets\nLiabilities\tof\tconsolidated\tVIEs: | 2,325 | 2,264 |
| Borrowings | (2,369) | (2,402) |
| Other\tliabilities | (74) | (103) |
| Appropriated\tretained\tearnings | (22) | (29) |
| Noncontrolling\tinterests\tof |  |  |
| consolidated\tVIEs | (21) | (27) |
| Total\tBlackRock\tnet\tinterests\tin |  |  |
| consolidated\tVIEs | $— | $— |

During	2013,	the	Company	did	not	record	any	nonoperating	net	income	(loss)	on consolidated	VIEs	on	the	consolidated	statements	of	income.	During	2012,	the Company	recorded	a	$38	million	nonoperating	net	loss	on	consolidated	VIEs	offset	by	a $38	million	net	loss	attributable	to	nonredeemable	noncontrolling	interests	on	the consolidated	statements	of	income.	During	2011,	the	Company	recorded	an	$18	million nonoperating	net	loss	on	consolidated	VIEs	offset	by	an	$18	million	net	loss	attributable to	nonredeemable	noncontrolling	interests	on	the	consolidated	statements	of	income.

At	December	31,	2013	and	2012,	the	weighted-average	maturity	of	the	bank	loans	and bonds	was	approximately	4.7	years	and	4.5	years,	respectively.

Non-Consolidated	VIEs.	At	December	31,	2013	and	2012,	the	Company's	carrying	value	of	assets	and	liabilities	and	its	maximum	risk	of	loss	related	to	VIEs	for	which	it	was	the sponsor	or	in	which	it	held	a	variable	interest,	but	for	which	it	was	not	the	PB,	was	as	follows:

|  | Variable	Interests	on	the	Consolidated | Variable	Interests	on	the	Consolidated |  |  |
| :--- | :--- | :--- | :--- | :--- |
| (in\tmillions) |  | Statement\tof\tFinancial\tCondition |  |  |
|  |  | Advisory | Other\tNet |  |
|  |  | Fee | Assets | Maximum |
| At\tDecember\t31,\t2013 | Investments | Receivables | (Liabilities) | Risk\tof\tLoss(1) |
| CDOs/CLOs | $— | $1 | $(4) | $18 |
| Other\tsponsored\tinvestment\tfunds: |  |  |  |  |
| Collective\ttrusts | — | 184 | \t\t— | 184 |
| Other | 37 | 137 | (6) | 174 |
| Total | $\t37 | $\t322 | $(10) | $\t376 |

|  | Variable	Interests	on	the	Consolidated | Variable	Interests	on	the	Consolidated |  |  |
| :--- | :--- | :--- | :--- | :--- |
| (in\tmillions) |  | Statement\tof\tFinancial\tCondition |  |  |
|  |  | Advisory | Other\tNet |  |
|  |  | Fee | Assets | Maximum |
| At\tDecember\t31,\t2012 | Investments | Receivables | (Liabilities) | Risk\tof\tLoss(1) |
| CDOs/CLOs | $1 | $1 | $(5) | $19 |
| Other\tsponsored\tinvestment\tfunds: |  |  |  |  |
| Collective\ttrusts | — | 248 | — | 248 |
| Other | 17 | 61 | (3) | 77 |
| Total | $\t18 | $\t310 | $(8) | $\t344 |

(1) At	both	December	31,	2013	and	2012,	BlackRock's	maximum	risk	of	loss	associated	with	these	VIEs	primarily	related	to:	(i)	advisory	fee	receivables;	(ii)	BlackRock's	investments;	and	(iii)	$17	million	of	credit	protection sold	by	BlackRock	to	a	third	party	in	a	synthetic	CDO	transaction.

The	net	assets	related	to	the	above	CDOs/CLOs	and	other	sponsored	investment funds,	including	collective	trusts,	that	the	Company	does	not	consolidate	were	as follows:

# CDOs/CLOs

|  | December	31, | December	31, |
| :--- | :--- | :--- |
| (in\tbillions) | 2013 | 2012 |
| Assets\tat\tfair\tvalue | $\t\t\t1 | $\t\t\t4 |
| Liabilities(1) | 2 | 5 |
| Net\tassets | $(1) | $(1) |

(1) Amounts	primarily	comprised	of	unpaid	principal	debt	obligations	to	CDO/CLO	debt	holders.

The	net	assets	of	other	sponsored	investment	funds	that	are	nonconsolidated	VIEs approximated	$1.6	trillion	to	$1.7	trillion	at	December	31,	2013	and	$1.5	trillion	to	$1.6 trillion	at	December	31,	2012.	Net	assets	included	$1.4	trillion	of	collective	trusts	at December	31,	2013	and	$1.3	trillion	of	collective	trusts	at	December	31,	2012.	Each collective	trust	has	been	aggregated	separately	and	may	include	collective	trusts	that invest	in	other	collective	trusts.	The	net	assets	of	these	VIEs	primarily	are	comprised	of cash	and	cash	equivalents	and	investments	offset	by	liabilities	primarily	comprised	of various	accruals	for	the	sponsored	investment	vehicles.

# 7.	Derivatives	and	Hedging

The	Company	maintains	a	program	to	enter	into	swaps	to	hedge	against	market	price and	interest	rate	exposures	with	respect	to	certain	seed	investments	in	sponsored investment	products.	At	December	31,	2013,	the	Company	had	outstanding	total	return swaps	and	interest	rate	swaps	with	an	aggregate	notional	value	of	approximately $117	million	and	$71	million,	respectively.	At	December	31,	2012,	the	Company	had outstanding	total	return	swaps	with	an	aggregate	notional	value	of	approximately	$206 million.

The	Company	has	entered	into	a	credit	default	swap,	providing	credit	protection	to	a counterparty	of	approximately	$17	million,	representing	the	Company's	maximum	risk	of loss	with	respect	to	the	provision	of	credit	protection.	The	Company	carries	the	credit default	swap	at	fair	value	based	on	the	expected	future	cash	flows	under	the arrangement.

The	fair	values	of	the	outstanding	total	return	swaps,	interest	rate	swaps	and	the	credit default	swap	were	not	material	to	the	consolidated	statements	of	financial	condition	at December	31,	2013	and	2012.

The	Company	executes	forward	foreign	currency	exchange	contracts	to	mitigate	the risk	of	foreign	exchange	risk	movements.	At	December	31,	2013,	the	Company	had outstanding	forward	foreign	currency	exchange	contracts	with	an	aggregate	notional value	of	approximately	$792	million	and	a	fair	value	of	approximately	$26	million.	At December	31,	2012,	the	aggregate	notional	value	of	outstanding	forward	foreign currency	exchange	contracts	was	approximately	$79	million	and	the	fair	value	was immaterial.

Gains	(losses)	on	total	return	swaps	are	recorded	in	nonoperating	income	(expense)	on the	consolidated	statements	of	income	and	were	$(15)	million,	$(23)	million	and	$4 million	for	2013,	2012	and	2011,	respectively.

Gains	(losses)	on	forward	foreign	currency	exchange	contracts	are	recorded	in	other general	and	administration	expense	on	the	consolidated	statement	of	income	and	were $(26)	million	for	2013.	Gains	(losses)	on	forward	foreign	currency	exchange	contracts were	not	material	to	the	consolidated	statements	of	income	for	2012	and	2011.

Gains	(losses)	on	the	interest	rate	swaps	and	the	credit	default	swap	were	not	material to	the	consolidated	statements	of	income	for	2013,	2012	and	2011.

The	Company	consolidates	certain	sponsored	investment	funds,	which	may	utilize derivative	instruments	as	a	part	of	the	funds'	investment	strategies.	The	fair	value	of such	derivatives	at	December	31,	2013	and	2012	was	not	material.	The	change	in	fair value	of	such	derivatives,	which	is	recorded	in	nonoperating	income	(expense),	was	not material	for	2013,	2012	and	2011.

In	May	2011,	the	Company	entered	into	a	designated	cash	flow	hedge	consisting	of	a $750	million	interest	rate	swap	to	hedge	future	cash	flows	on	the	Company's	floating rate	notes	due	in	2013.	Interest	on	this	swap	was	at	a	fixed	rate	of	1.03%,	payable semi-annually	on	May	24	and	November	24	of	each	year.	During	2013,	the	interest	rate swap	matured	and	the	floating	rate	notes	were	fully	repaid.	Gains	(losses)	on	the interest	rate	swap	were	not	material	to	the	consolidated	statements	of	income	for	2013, 2012	and	2011.

# 8.	Property	and	Equipment

Property	and	equipment	consists	of	the	following:

| (in	millions) | life-in	years | 2013 | 2012 |
| :--- | :--- | :--- | :--- |
| Property\tand\tequipment: |  |  |  |
| Land | N/A | $4 | $4 |
| Building | 39 | 17 | 17 |
| Building\timprovements | 15 | 14 | 13 |
| Leasehold\timprovements | 1-15 | 501 | 482 |
| Equipment\tand\tcomputer |  |  |  |
| software | 3 | 451 | 465 |
| Other\ttransportation |  |  |  |
| equipment | 10 | 56 | 56 |
| Furniture\tand\tfixtures | 7 | 93 | 92 |
| Total |  | \t 1,136 | \t 1,129 |
| Less:\taccumulated |  |  |  |
| depreciation\tand |  |  |  |
| amortization |  | 611 | 572 |
| Property\tand\tequipment,\tnet |  | $525 | $557 |

Qualifying	software	costs	of	approximately	$35	million,	$36	million	and	$37	million	have been	capitalized	within	equipment	and	computer	software	during	2013,	2012	and	2011, respectively,	and	are	being	amortized	over	an	estimated	useful	life	of	three	years.

# 9.	Goodwill

Goodwill	activity	during	2013	and	2012	was	as	follows:

| (in	millions) | 2013 | 2012 |
| :--- | :--- | :--- |
| Beginning\tof\tyear\tbalance | $ 12,910 | $ 12,792 |
| Acquisitions(1) | 73 | 131 |
| (2)\nGoodwill\tadjustments\trelated\tto\tQuellos\tand\tother | (3) | (13) |
| End\tof\tyear\tbalance | $\t12,980 | $\t12,910 |

(1) The	2013	amount	primarily	represents	$29	million	of	goodwill	from	the	Company's	acquisition	of MGPA,	an	independently	managed	private	equity	real	estate	investment	advisory	company	primarily	in Asia	and	Europe,	on	October	4,	2013	for	approximately	$66	million	(the	"MGPA	Transaction")	and	$44 million	of	goodwill	from	the	Company's	acquisition	of	Credit	Suisse's	ETF	franchise	on	July	1,	2013	for approximately	$273	million	(the	"Credit	Suisse	ETF	Transaction").	The	amount	for	2012	represents $106	million	of	goodwill	from	the	Company's	acquisition	of	the	Canadian	exchange-traded	products ("ETP")	provider,	Claymore	Investments,	Inc.	(the	"Claymore	Transaction")	on	March	7,	2012	for approximately	$212	million	and	$25	million	of	goodwill	from	the	Company's	acquisition	of	the European	private	equity	and	infrastructure	funds	of	funds	franchise	of	Swiss	Re	Private	Equity Partners	(the	"SRPEP	Transaction")	on	September	4,	2012.

(2) The	decrease	in	goodwill	during	both	2013	and	2012	primarily	resulted	from	a	decline	of	approximately $20	million	related	to	tax	benefits	realized	from	tax-deductible	goodwill	in	excess	of	book	goodwill	from the	acquisition	of	the	fund-of-funds	business	of	Quellos	Group,	LLC	in	October	2007	(the	"Quellos Transaction").	Goodwill	related	to	the	Quellos	Transaction	will	continue	to	be	reduced	in	future	periods by	the	amount	of	tax	benefits	realized	from	tax-deductible	goodwill	in	excess	of	book	goodwill	from	the Quellos	Transaction.	The	balance	of	the	Quellos	tax-deductible	goodwill	in	excess	of	book	goodwill was	approximately	$293	million	and	$324	million	at	December	31,	2013	and	2012,	respectively.	In 2012,	the	decrease	in	Quellos	goodwill	was	partially	offset	by	a	$10	million	increase	related	to	the release	of	the	remaining	common	shares	held	in	escrow	in	connection	with	the	Quellos	Transaction.

The	impairment	tests	performed	for	goodwill	as	of	July	31,	2013,	2012	and	2011 indicated	that	no	impairment	charges	were	required.	The	Company	continuously monitors	its	book	value	per	share	as	compared	with	closing	prices	of	its	common	stock for	potential	indicators	of	impairment.	At	December	31,	2013,	the	Company's	common stock	closed	trading	at	a	price	of	$316.47	per	share,	which	exceeded	its	book	value	per share	of	approximately	$156.69	excluding	appropriated	retained	earnings.

# 10.	Intangible	Assets

Intangible	assets	at	December	31,	2013	and	2012	consisted	of	the	following:

| Management	contracts | N/A | $15,582 | $— | $15,582 |
| :--- | :--- | :--- | :--- | :--- |
| Trade\tnames\t/\ttrademarks | N/A | 1,403 | — | 1,403 |
| License | N/A | 6 | — | 6 |
| Total\tindefinite-lived\tintangible\tassets |  | 16,991 | — | 16,991 |
| Finite-lived\tintangible\tassets: |  |  |  |  |
| Management\tcontracts | 4.3 | 1,561 | 1,054 | 507 |
| Intellectual\tproperty | 4.6 | 6 | 3 | 3 |
| Total\tfinite-lived\tintangible\tassets | 4.3 | 1,567 | 1,057 | 510 |
| Total\tintangible\tassets |  | $18,558 | $\t1,057 | $17,501 |
| At\tDecember\t31,\t2012 |  |  |  |  |
| Indefinite-lived\tintangible\tassets: |  |  |  |  |
| Management\tcontracts | N/A | $\t15,351 | $— | $\t15,351 |
| Trade\tnames\t/\ttrademarks | N/A | 1,403 | — | 1,403 |
| License | N/A | 6 | — | 6 |
| Total\tindefinite-lived\tintangible\tassets |  | 16,760 | — | 16,760 |
| Finite-lived\tintangible\tassets: |  |  |  |  |
| Management\tcontracts | 4.9 | 1,535 | 896 | 639 |
| Intellectual\tproperty | 5.6 | 6 | 3 | 3 |
| Total\tfinite-lived\tintangible\tassets | 4.9 | 1,541 | 899 | 642 |
| Total\tintangible\tassets |  | $18,301 | $899 | $17,402 |

The	impairment	tests	performed	for	intangible	assets	as	of	July	31,	2013,	2012	and 2011	indicated	no	impairment	charges	were	required.

Estimated	amortization	expense	for	finite-lived	intangible	assets	for	each	of	the	five succeeding	years	is	as	follows:

# Indefinite-Lived	Acquired	Management	Contracts

In	July	2013,	in	connection	with	the	Credit	Suisse	ETF	Transaction,	the	Company acquired	$231	million	of	indefinite-lived	management	contracts.

In	March	2012,	in	connection	with	the	Claymore	Transaction,	the	Company	acquired $163	million	of	indefinite-lived	ETP	management	contracts.

# Finite-Lived	Acquired	Management	Contracts

In	October	2013,	in	connection	with	the	MGPA	Transaction,	the	Company	acquired	$29 million	of	finite-lived	management	contracts	with	a	weighted-average	estimated	useful life	of	approximately	eight	years.

In	September	2012,	in	connection	with	the	SRPEP	Transaction,	the	Company	acquired $40	million	of	finite-lived	management	contracts	with	a	weighted-average	estimated useful	life	of	approximately	10	years.

# 11.	Other	Assets

At	March	31,	2013,	BlackRock	held	an	approximately	one-third	economic	equity	interest in	Private	National	Mortgage	Acceptance	Company,	LLC	("PNMAC"),	which	is accounted	for	as	an	equity	method	investment	and	is	included	in	other	assets	on	the consolidated	statements	of	financial	condition.	On	May	8,	2013,	PennyMac	became	the sole	managing	member	of	PNMAC	in	connection	with	an	initial	public	offering	of PennyMac	(the	"PennyMac	IPO").	As	a	result	of	the	PennyMac	IPO,	BlackRock recorded	a	noncash,	nonoperating	pre-tax	gain	of	$39	million	related	to	the	carrying value	of	its	equity	method	investment.

Subsequent	to	the	PennyMac	IPO,	the	Company	contributed	6.1	million	units	of	its investment	to	a	new	donor	advised	fund	(the	"Charitable	Contribution").	The	fair	value	of the	Charitable	Contribution	was	$124	million	and	is	included	in	general	and administration	expenses	on	the	consolidated	statements	of	income.	In	connection	with the	Charitable	Contribution,	the	Company	also	recorded	a	noncash,	nonoperating	pre- tax	gain	of	$80	million	related	to	the	contributed	investment	and	a	tax	benefit	of approximately	$48	million.

The	carrying	value	and	fair	value	of	the	Company's	remaining	interest	(approximately 20%	or	16	million	shares	and	units)	was	approximately	$127	million	and	$273	million, respectively,	at	December	31,	2013.	The	fair	value	of	the	Company's	interest	reflected the	PennyMac	stock	price	at	December	31,	2013	(Level	1	input).

# 12.	Borrowings

The	carrying	value	of	short-term	borrowings	at	December	31,	2012	included	$100 million	under	the	2012	revolving	credit	facility.

Commercial	Paper	Program.	On	October	14,	2009,	BlackRock	established	a commercial	paper	program	(the	"CP	Program")	under	which	the	Company	could	issue unsecured	commercial	paper	notes	(the	"CP	Notes")	on	a	private	placement	basis	up	to a	maximum	aggregate	amount	outstanding	at	any	time	of	$3.0	billion.	On	May	13, 2011,	BlackRock	increased	the	maximum	aggregate	amount	that	may	be	borrowed under	the	CP	Program	to	$3.5	billion.	On	May	17,	2012,	BlackRock	increased	the maximum	aggregate	amount	to	$3.785	billion.	In	April	2013,	BlackRock	increased	the maximum	aggregate	amount	for	which	the	Company	could	issue	unsecured	CP	Notes on	a	private-placement	basis	up	to	a	maximum	aggregate	amount	outstanding	at	any time	of	$3.990	billion.	The	commercial	paper	program	is	currently	supported	by	the 2013	credit	facility.	At	December	31,	2013	and	2012,	BlackRock	had	no	CP	Notes outstanding.

The	carrying	value	and	fair	value	of	long-term	borrowings	estimated	using	market	prices	at	December	31,	2013	included	the	following:

|  |  | Unamortized |  |  |
| :--- | :--- | :--- | :--- | :--- |
| (in\tmillions) | Maturity\tAmount | Discount | Carrying\tValue | Fair\tValue |
| 3.50%\tNotes\tdue\t2014 | $\t1,000 | $— | $\t1,000 | $1,029 |
| 1.375%\tNotes\tdue\t2015 | 750 | \t\t— | 750 | 759 |
| 6.25%\tNotes\tdue\t2017 | 700 | (2) | 698 | 812 |
| 5.00%\tNotes\tdue\t2019 | 1,000 | (2) | 998 | 1,140 |
| 4.25%\tNotes\tdue\t2021 | 750 | (3) | 747 | 799 |
| 3.375%\tNotes\tdue\t2022 | 750 | (4) | 746 | 745 |
| Total\tLong-term\tBorrowings | $4,950 | $(11) | $4,939 | $\t5,284 |

Long-term	borrowings	at	December	31,	2012	had	a	carrying	value	of	$5.687	billion	and a	fair	value	of	$6.275	billion	determined	using	market	prices	at	the	end	of December	2012.

2015	and	2022	Notes.	In	May	2012,	the	Company	issued	$1.5	billion	in	aggregate principal	amount	of	unsecured	unsubordinated	obligations.	These	notes	were	issued	as two	separate	series	of	senior	debt	securities	including	$750	million	of	1.375%	notes maturing	in	June	2015	(the	"2015	Notes")	and	$750	million	of	3.375%	notes	maturing	in June	2022	(the	"2022	Notes").	Net	proceeds	were	used	to	fund	the	repurchase	of BlackRock's	common	stock	and	Series	B	Preferred	from	Barclays	and	affiliates	and	for general	corporate	purposes.	Interest	on	the	2015	Notes	and	the	2022	Notes	of approximately	$10	million	and	$25	million	per	year,	respectively,	is	payable	semi- annually	on	June	1	and	December	1	of	each	year,	which	commenced	December	1, 2012.	The	2015	Notes	and	2022	Notes	may	be	redeemed	prior	to	maturity	at	any	time in	whole	or	in	part	at	the	option	of	the	Company	at	a	"make-whole"	redemption	price. The	"make-whole"	redemption	price	represents	a	price,	subject	to	the	specific	terms	of the	2015	and	2022	Notes	and	related	indenture,	that	is	the	greater	of	(a)	par	value	and (b)	the	present	value	of	future	payments	that	will	not	be	paid	because	of	an	early redemption,	which	is	discounted	at	a	fixed	spread	over	a	comparable	Treasury	security. The	2015	Notes	and	2022	Notes	were	issued	at	a	discount	of	$5	million	that	is	being amortized	over	the	term	of	the	notes.	The	Company	incurred	approximately	$7	million	of debt	issuance	costs,	which	are	being	amortized	over	the	respective	terms	of	the	2015 Notes	and	2022	Notes.	At	December	31,	2013,	$5	million	of	unamortized	debt	issuance costs	was	included	in	other	assets	on	the	consolidated	statement	of	financial	condition.

2013	and	2021	Notes.	In	May	2011,	the	Company	issued	$1.5	billion	in	aggregate principal	amount	of	unsecured	unsubordinated	obligations.	These	notes	were	issued	as two	separate	series	of	senior	debt	securities	including	$750	million	of	4.25%	notes maturing	in	May	2021	and	$750	million	of	floating	rate	notes	("2013	Floating	Rate Notes"),	which	were	repaid	in	May	2013	at	maturity.	Net	proceeds	of	this	offering	were used	to	fund	the	repurchase	of	BlackRock's	Series	B	Preferred	from	affiliates	of	Merrill Lynch	&	Co.,	Inc.	("Merrill	Lynch").	Interest	on	the	4.25%	notes	due	in	2021	("2021 Notes")	is	payable	semi-annually	on	May	24	and	November	24	of	each	year,	which commenced	November	24,	2011,	and	is	approximately	$32	million	per	year.	The	2021 Notes	may	be	redeemed	prior	to	maturity	at	any	time	in	whole	or	in	part	at	the	option	of the	Company	at	a	"make-whole"	redemption	price.	The	2021	Notes	were

issued	at	a	discount	of	$4	million	that	is	being	amortized	over	the	term	of	the	notes.	The Company	incurred	approximately	$7	million	of	debt	issuance	costs	for	the	$1.5	billion note	issuances,	which	are	being	amortized	over	the	respective	terms	of	the	notes.	At December	31,	2013,	$3	million	of	unamortized	debt	issuance	costs	was	included	in other	assets	on	the	consolidated	statement	of	financial	condition.

2012,	2014	and	2019	Notes.	In	December	2009,	the	Company	issued	$2.5	billion	in aggregate	principal	amount	of	unsecured	and	unsubordinated	obligations.	These	notes were	issued	as	three	separate	series	of	senior	debt	securities	including	$0.5	billion	of 2.25%	notes,	which	were	repaid	in	December	2012,	$1.0	billion	of	3.50%	notes	and $1.0	billion	of	5.0%	notes	maturing	in	December	2014	and	2019,	respectively.	Net proceeds	of	this	offering	were	used	to	repay	borrowings	under	the	CP	Program,	which was	used	to	finance	a	portion	of	the	acquisition	of	Barclays	Global	Investors	("BGI") from	Barclays	on	December	1,	2009	(the	"BGI	Transaction"),	and	for	general	corporate purposes.	Interest	on	the	2014	Notes	and	2019	Notes	of	approximately	$35	million	and $50	million	per	year,	respectively,	is	payable	semi-annually	in	arrears	on	June	10	and December	10	of	each	year.	These	notes	may	be	redeemed	prior	to	maturity	at	any	time in	whole	or	in	part	at	the	option	of	the	Company	at	a	"make-whole"	redemption	price. These	notes	were	issued	collectively	at	a	discount	of	$5	million,	which	is	being amortized	over	the	respective	terms	of	the	notes.	The	Company	incurred	approximately $13	million	of	debt	issuance	costs,	which	are	being	amortized	over	the	respective	terms of	these	notes.	At	December	31,	2013,	$4	million	of	unamortized	debt	issuance	costs was	included	in	other	assets	on	the	consolidated	statement	of	financial	condition.

2017	Notes.	In	September	2007,	the	Company	issued	$700	million	in	aggregate principal	amount	of	6.25%	senior	unsecured	and	unsubordinated	notes	maturing	on September	15,	2017	(the	"2017	Notes").	A	portion	of	the	net	proceeds	of	the	2017	Notes was	used	to	fund	the	initial	cash	payment	for	the	acquisition	of	the	fund	of	funds business	of	Quellos	and	the	remainder	was	used	for	general	corporate	purposes. Interest	is	payable	semi-annually	in	arrears	on	March	15	and	September	15	of	each year,	or	approximately	$44	million	per	year.	The	2017	Notes	may	be	redeemed	prior

to	maturity	at	any	time	in	whole	or	in	part	at	the	option	of	the	Company	at	a	"make- whole"	redemption	price.	The	2017	Notes	were	issued	at	a	discount	of	$6	million,	which is	being	amortized	over	their	ten-year	term.	The	Company	incurred	approximately	$4 million	of	debt	issuance	costs,	which	are	being	amortized	over	ten	years.	At December	31,	2013,	$2	million	of	unamortized	debt	issuance	costs	was	included	in other	assets	on	the	consolidated	statement	of	financial	condition.

# 13.	Commitments	and	Contingencies

# Operating	Lease	Commitments

The	Company	leases	its	primary	office	spaces	under	agreements	that	expire	through 2035.	Future	minimum	commitments	under	these	operating	leases	are	as	follows:

| (in	millions) |  |
| :--- | :--- |
| Year | Amount |
| 2014 | $135 |
| 2015 | 127 |
| 2016 | 110 |
| 2017 | 109 |
| 2018 | 106 |
| Thereafter | 699 |
| Total | $\t1,286 |

Rent	expense	and	certain	office	equipment	expense	under	agreements	amounted	to $137	million,	$133	million	and	$154	million	in	2013,	2012	and	2011,	respectively.

# Contingencies

Contingent	Payments.	The	Company	acts	as	the	portfolio	manager	in	a	series	of	credit default	swap	transactions	and	has	a	maximum	potential	exposure	of	$17	million	under	a credit	default	swap	between	the	Company	and	counterparty.	See	Note	7,	Derivatives and	Hedging,	for	further	discussion.

Contingent	Payments	Related	to	Business	Acquisitions.	In	connection	with	the	Credit Suisse	ETF	Transaction,	BlackRock	is	required	to	make	contingent	payments

annually	to	Credit	Suisse,	subject	to	achieving	specified	thresholds	during	a	seven-year period,	subsequent	to	the	acquisition	date.	In	addition,	BlackRock	is	required	to	make contingent	payments	related	to	the	MGPA	Transaction	during	a	five-year	period, subject	to	achieving	specified	thresholds,	subsequent	to	the	acquisition	date.	The	fair value	of	the	contingent	payments	at	December	31,	2013	is	not	significant	to	the consolidated	statement	of	financial	condition	and	is	included	in	other	liabilities.

Legal	Proceedings.	From	time	to	time,	BlackRock	receives	subpoenas	or	other requests	for	information	from	various	U.S.	federal,	state	governmental	and	domestic and	international	regulatory	authorities	in	connection	with	certain	industry-wide	or	other investigations	or	proceedings.	It	is	BlackRock's	policy	to	cooperate	fully	with	such inquiries.	The	Company	and	certain	of	its	subsidiaries	have	been	named	as	defendants in	various	legal	actions,	including	arbitrations	and	other	litigation	arising	in	connection with	BlackRock's	activities.	Additionally,	certain	BlackRock-sponsored	investment	funds that	the	Company	manages	are	subject	to	lawsuits,	any	of	which	potentially	could	harm the	investment	returns	of	the	applicable	fund	or	result	in	the	Company	being	liable	to the	funds	for	any	resulting	damages.

Indemnifications.	In	the	ordinary	course	of	business	or	in	connection	with	certain acquisition	agreements,	BlackRock	enters	into	contracts	pursuant	to	which	it	may agree	to	indemnify	third	parties	in	certain	circumstances.	The	terms	of	these indemnities	vary	from	contract	to	contract	and	the	amount	of	indemnification	liability,	if any,	cannot	be	determined	or	the	likelihood	of	any	liability	is	considered	remote. Consequently,	no	liability	has	been	recorded	on	the	consolidated	statement	of	financial condition.

In	connection	with	securities	lending	transactions,	BlackRock	has	issued	certain indemnifications	to	certain	securities	lending	clients	against	potential	loss	resulting	from a	borrower's	failure	to	fulfill	its	obligations	under	the	securities	lending	agreement should	the	value	of	the	collateral	pledged	by	the	borrower	at	the	time	of	default	be insufficient	to	cover	the	borrower's	obligation	under	the	securities	lending	agreement.	At December	31,	2013,	the	Company	indemnified	certain	of	its	clients	for	their	securities lending	loan	balances	of	approximately	$118.3	billion.	The	Company	held	as	agent, cash	and	securities	totaling	$124.6	billion	as	collateral	for	indemnified	securities	on	loan at	December	31,	2013.	The	fair	value	of	these	indemnifications	was	not	material	at December	31,	2013.

# 14.	Stock-Based	Compensation

The	components	of	stock-based	compensation	expense	are	as	follows:

|  | Year	ended	December	31, | Year	ended	December	31, |  |
| :--- | :--- | :--- | :--- |
| (in\tmillions) | 2013 | 2012 | 2011 |
| Stock-based\tcompensation: |  |  |  |
| Restricted\tstock\tand\tRSUs | $415 | $429 | $444 |
| Market\tperformance-based\tRSUs\tto\tbe\tfunded |  |  |  |
| by\tPNC | 33 | 15 | — |
| Long-term\tincentive\tplans\tto\tbe\tfunded\tby\tPNC | — | 7 | 44 |
| Stock\toptions | — | — | 9 |
| Total\tstock-based\tcompensation | $\t448 | $\t451 | $\t497 |

Stock	Award	and	Incentive	Plan.	Pursuant	to	the	BlackRock,	Inc.	1999	Stock	Award and	Incentive	Plan	(the	"Award	Plan"),	options	to	purchase	shares	of	the	Company's common	stock	at	an	exercise	price	not	less	than	the	market	value	of	BlackRock's common	stock	on	the	date	of	grant	in	the	form	of	stock	options,	restricted	stock	or RSUs	may	be	granted	to	employees	and	non-employee	directors.	A	maximum	of 27,000,000	shares	of	common	stock	were	authorized	for	issuance	under	the	Award Plan.	Of	this	amount,	3,304,834	shares	remain	available	for	future	awards	at December	31,	2013.	Upon	exercise	of	employee	stock	options,	the	issuance	of restricted	stock	or	the	vesting	of	RSUs,	the	Company	issues	shares	out	of	treasury	to the	extent	available.

Restricted	Stock	and	RSUs.	Pursuant	to	the	Award	Plan,	restricted	stock	grants	and RSUs	may	be	granted	to	certain	employees.	Substantially	all	restricted	stock	and	RSUs vest	over	periods	ranging	from	one	to	four	years	and	are	expensed	using	the	straight- line	method	over	the	requisite	service	period	for	each	separately	vesting	portion	of	the award	as	if	the	award	was,	in-substance,	multiple	awards.	Prior	to	2009,	the	Company awarded	restricted	stock	and	RSUs	with	nonforfeitable	dividend	equivalent	rights. Restricted	stock	and	RSUs	awarded	beginning	in	2009	are	not	considered	participating securities	for	purposes	of	calculating	EPS	as	the	dividend	equivalents	are	subject	to forfeiture	prior	to	vesting	of	the	award.

Restricted	stock	and	RSU	activity	for	2013	is	summarized	below:

|  | Restricted | Average |
| :--- | :--- | :--- |
|  | Stock\tand | Grant\tDate |
| Outstanding\tat | Units | Fair\tValue |
| December\t31,\t2012 | 5,620,835 | $197.90 |
| Granted | 1,660,532 | $234.75 |
| Converted | \t(2,588,637) | $204.09 |
| Forfeited | (79,917) | $204.12 |
| December\t31,\t2013(1) | 4,612,813 | $207.94 |

(1) At	December	31,	2013,	approximately	4.4	million	awards	are	expected	to	vest	and	0.2	million	awards have	vested	but	have	not	been	converted.

The	Company	values	restricted	stock	and	RSUs	at	their	grant-date	fair	value	as measured	by	BlackRock's	common	stock	price.	The	total	fair	market	value	of	RSUs granted	to	employees	during	2013,	2012	and	2011	was	$390	million,	$348	million	and $477	million,	respectively.	The	total	fair	market	value	of	RSUs	converted	to	common stock	during	2013,	2012	and	2011	was	$528	million,	$297	million	and	$553	million, respectively.

The	awards	granted	under	the	Award	Plan	primarily	related	to	the	following:

•	1,594,259	RSUs	to	employees	as	part	of	annual	incentive	compensation	that	vest ratably	over	three	years	from	the	date	of	grant;	and

At	December	31,	2013,	there	was	$250	million	in	total	unrecognized	stock-based compensation	expense	related	to	unvested	RSUs.	The	unrecognized	compensation cost	is	expected	to	be	recognized	over	the	remaining	weighted-average	period	of	0.7 years.

In	January	2014,	the	Company	granted	the	following	awards	under	the	Award	Plan:

•	1,022,295	RSUs	to	employees	as	part	of	annual	incentive	compensation	that	vest ratably	over	three	years	from	the	date	of	grant;	and

Market	Performance-based	RSUs.	Pursuant	to	the	Award	Plan,	market	performance- based	RSUs	may	be	granted	to	certain	employees.	The	market	performance-based RSUs	require	that	separate	15%,	25%	and	35%	share	price	appreciation	targets	be achieved	during	the	six-year	term	of	the	awards.	The	awards	are	split	into	three tranches	and	each	tranche	may	vest	if	the	specified	target	increase	in	share	price	is met.	Eligible	delivery	dates	for	each	tranche	are	the	fourth,	fifth	or	sixth	anniversaries	of the	grant	date.	Certain	awards	are	forfeited	if	the	employee	leaves	BlackRock	before the	vesting	date.	These	awards	are	amortized	over	a	service	period	of	four	years,	which is	the	longer	of	the	explicit	service	period	or	the	period	in	which	the	market	target	is expected	to	be	met.	Market	performance-based	RSUs	are	not	considered	participating securities	as	the	dividend	equivalents	are	subject	to	forfeiture	prior	to	vesting	of	the award.	In	2013,	the	Company	granted	market	performance-based	RSUs,	which	will	be funded	primarily	by	shares	currently	held	by	PNC	(see	Long-Term	Incentive	Plans Funded	by	PNC	below).

Market	performance-based	RSU	activity	for	2013	is	summarized	below:

|  | Market | Average |
| :--- | :--- | :--- |
|  | Performance- | Grant\tDate |
| Outstanding\tat | Based\tRSUs | Fair\tValue |
| December\t31,\t2012 | 575,532 | $115.03 |
| Granted | 556,581 | $126.76 |
| December\t31,\t2013(1) | 1,132,113 | $\t120.80 |

(1) At	December	31,	2013,	approximately	1.1	million	awards	are	expected	to	vest	and	no	awards	have vested	and	have	been	converted.

At	December	31,	2013,	total	unrecognized	stock-based	compensation	expense	related to	unvested	market	performance-based	awards	was	$88	million.	The	unrecognized compensation	cost	is	expected	to	be	recognized	over	a	remaining	weighted-average period	of	2.6	years.

The	grant-date	fair	value	of	the	awards	was	$71	million	in	both	2013	and	2012.	The	fair value	was	calculated	using	a	Monte	Carlo	simulation	with	the	following	assumptions:

Stock	Options.	Stock	option	grants	were	made	to	certain	employees	pursuant	to	the Award	Plan	in	1999	through	2007.	Options	granted	have	a	ten-year	life,	vested	ratably over	periods	ranging	from	two	to	five	years	and	became	exercisable	upon	vesting.	The Company	has	not	granted	any	stock	options	subsequent	to	the	January	2007	grant, which	vested	on	September	29,	2011.	Stock	option	activity	for	2013	is	summarized below:

|  | Shares | average |
| :--- | :--- | :--- |
|  | under | exercise |
| Outstanding\tat | option | price |
| December\t31,\t2012 | \t 1,099,909 | $167.76 |
| Exercised | (168,151) | $167.76 |
| December\t31,\t2013(1) | 931,758 | $\t167.76 |

(1) At	December	31,	2013,	all	options	were	vested.	The	aggregate	intrinsic	value	of	options	exercised during	the	years	ended	December	31,	2013,	2012	and	2011	was	$19	million,	$157	million	and	$13 million,	respectively.

Stock	options	outstanding	and	exercisable	at	December	31,	2013	were	as	follows:

In	January	2014,	the	Company	granted	315,961	market	performance-based	RSUs under	the	Award	Plan.

# Long-Term	Incentive	Plans	Funded	by	PNC.	Under	a	share	surrender	agreement,

PNC	committed	to	provide	up	to	4	million	shares	of	BlackRock	stock,	held	by	PNC,	to fund	certain	BlackRock	long-term	incentive	plans	("LTIP").	The	current	share	surrender agreement	commits	PNC	to	provide	BlackRock	series	C	nonvoting	participating preferred	stock	to	fund	the	remaining	committed	shares.	As	of	December	31,	2012, 2.5	million	shares	had	been	surrendered	by	PNC.	In	January	2013,	0.2	million	additional shares	were	surrendered.

At	December	31,	2013,	the	remaining	shares	committed	by	PNC	of	1.3	million	were available	to	fund	future	long-term	incentive	awards.

# Employee	Stock	Purchase	Plan	("ESPP").	The	ESPP	allows	eligible	employees	to

purchase	the	Company's	common	stock	at	95%	of	the	fair	market	value	on	the	last	day of	each	three-month	offering	period.	In	accordance	with	ASC	718-10,	Compensation– Stock	Compensation,	the	Company	does	not	record	compensation	expense	related	to employees	purchasing	shares	under	the	ESPP.

# 15.	Employee	Benefit	Plans

# Deferred	Compensation	Plans

Voluntary	Deferred	Compensation	Plan.	The	Company	adopted	a	Voluntary	Deferred Compensation	Plan	("VDCP")	that	allows	participants	to	elect	to	defer	between	1%	and 100%	of	their	annual	cash	incentive	compensation.	The	participants	must	specify	a deferral	period	of	up	to	10	years	from	the	year	of	deferral.	The	Company	funds	the obligation	through	the	establishment	of	a	rabbi	trust	on	behalf	of	the	plan's	participants.

The	rabbi	trust	established	for	the	VDCP,	with	assets	totaling	$65	million	and	$59 million	December	31,	2013	and	2012,	respectively,	is	reflected	in	investments	on	the consolidated	statements	of	financial	condition.	Such	investments	are	classified	as trading	and	other	investments.	The	corresponding	liability	balance	of	$64	million	and $60	million	at	December	31,	2013	and	2012,	respectively,	is	reflected	on	the consolidated	statements	of	financial	condition	as	accrued	compensation	and	benefits. Earnings	in	the	rabbi	trust,	including	unrealized	appreciation	or	depreciation,	are reflected	as	nonoperating	income	(expense)	and	changes	in	the	corresponding	liability are	reflected	as	employee	compensation	and	benefits	expense	on	the	consolidated statements	of	income.

Other	Deferred	Compensation	Plans.	The	Company	has	additional	compensation	plans for	the	purpose	of	providing	deferred	compensation	and	retention	incentives	to	certain employees.	For	these	plans,	the	final	value	of	the	deferred	amount	to	be	distributed	in cash	upon	vesting	is	associated	with	investment	returns	of	certain	investment	funds. The	liabilities	for	these	plans	were	$100	million	and	$77	million	at	December	31,	2013 and	2012,	respectively,	and	are	reflected	in	the	consolidated	statements	of	financial condition	as	accrued	compensation	and	benefits.	In	January	2014,	the	Company granted	approximately	$100	million	of	additional	deferred	compensation	that	will fluctuate	with	investment	returns	and	will	vest	ratably	over	three	years	from	the	date	of grant.

# Defined	Contribution	Plans

BlackRock	Retirement	Savings	Plan.	Certain	of	the	Company's	employees	participate in	the	BlackRock	Retirement	Savings	Plan	("BRSP").	Employee	contributions	of	up	to 8%	of	eligible	compensation,	as	defined	by	the	plan	and	subject	to	Internal	Revenue Code	("IRC")	limitations,	are	matched	by	the	Company	at	50%.	In	addition,	the Company	will	continue	to	make	an	annual	retirement	contribution	to	eligible	participants equal	to	3-5%	of	eligible	compensation.	In	2013,	2012	and	2011,	the	Company's expense	related	to	the	BRSP	was	$63	million,	$59	million	and	$43	million,	respectively.

# BlackRock	Group	Personal	Pension	Plan.	BlackRock	Investment	Management	(UK)

Limited	("BIM"),	a	wholly	owned	subsidiary	of	the	Company,	contributes	to	the BlackRock	Group	Personal	Pension	Plan,	a	defined	contribution	plan	for	all	employees of	BIM.	BIM	contributes	between	6%	and	15%	of	each	employee's	eligible compensation.	In	2013,	2012	and	2011,	the	Company's	expense	related	to	this	plan was	$29	million,	$27	million	and	$26	million,	respectively.

Defined	Benefit	Plans.	The	Company	has	several	defined	benefit	pension	plans	in Japan	and	Germany.	All	accrued	benefits	under	the	Germany	defined	benefit	plan	are currently	frozen	and	the	plan	is	closed	to	new	participants.	The	participant	benefits under	the	Germany	plan	will	not	change	with	salary	increases	or	additional	years	of service.	At	December	31,	2013	and	2012,	the	plan	assets	for	these	plans	were approximately	$22	million	and	$21	million,	respectively.	The	overfunded	obligations	at December	31,	2013	and	the	underfunded	obligation	at	December	31,	2012	were	not material.	Benefit	payments	for	the	next	five	years	and	in	aggregate	for	the	five	years thereafter	are	not	expected	to	be	material.

The	plan	assets	for	the	defined	benefit	plan	in	Japan	(the	"Japan	Plan")	are	invested using	a	total	return	investment	approach	whereby	a	mix	of	equity	securities,	debt securities

and	other	investments	are	used	to	preserve	asset	values,	diversify	risk	and	achieve	the target	investment	return	benchmark.	Investment	strategies	and	asset	allocations	are based	on	consideration	of	plan	liabilities	and	the	funded	status	of	the	plan.	Investment performance	and	asset	allocation	are	measured	and	monitored	on	an	ongoing	basis. The	current	target	allocations	for	the	plan	assets	are	22%	for	U.S.	and	international equity	securities,	76%	for	U.S.	and	international	fixed	income	securities	and	2%	for other.	The	table	below	provides	the	fair	value	of	the	plan	assets	of	the	Japan	Plan	at December	31,	2013	and	2012	by	asset	category	and	identifies	the	level	of	inputs	used to	determine	the	fair	value	of	assets	in	each	category.

# Post-retirement	Benefit	Plans

The	Company	provides	post-retirement	medical	benefits	to	a	closed	population	of employees	in	the	United	Kingdom	and	the	United	States.	The	accumulated	benefit obligation	for	each	of	these	unfunded	plans	was	immaterial	at	December	31,	2013	and 2012,	and	was	included	in	accrued	compensation	and	benefits	on	the	consolidated statements	of	financial	condition.	For	2013,	2012	and	2011,	expenses	for	these benefits	were	not	material.

# 16.	Related	Party	Transactions

# Determination	of	Related	Parties

PNC.	The	Company	considers	PNC,	along	with	its	affiliates,	to	be	related	parties	based on	the	level	of	its	ownership	of	BlackRock	capital	stock.	At	December	31,	2013,	PNC owned	approximately	20.9%	of	the	Company's	voting	common	stock	and	held approximately	21.9%	of	the	total	capital	stock.

Registered	Investment	Companies	and	Equity	Method	Investments.	The	Company considers	the	registered	investment	companies	that	it	manages,	which	include	mutual funds	and	exchanged-traded	funds,	to	be	related	parties	as	a	result	of	the	Company's advisory	relationship.	In	addition,	equity	method	investments	are	considered	related parties	in	accordance	with	ASC	850-10,	Related	Party	Disclosures	("ASC	850-10"),	due to	the	Company's	influence	over	the	financial	and	operating	policies	of	the	investee.

Barclays.	The	Company	considered	Barclays,	along	with	its	affiliates,	to	be	related parties	in	accordance	with	ASC	850-10,	based	on	its	level	of	capital	stock	ownership prior	to	the	secondary	offering	in	May	2012	by	Barclays	of	shares	of	the	Company's stock.	At	December	31,	2012,	Barclays	did	not	own	any	of	the	Company's	capital	stock and	was	no	longer	considered	a	related	party.

# Revenue	from	Related	Parties

Revenues	for	services	provided	by	the	Company	to	these	and	other	related	parties	are as	follows:

|  | Year	ended	December	31, | Year	ended	December	31, |  |
| :--- | :--- | :--- | :--- |
| (in\tmillions) | 2013 | 2012 | 2011 |
| Investment\tadvisory,\tadministration\tfees\tand |  |  |  |
| securities\tlending\trevenue: |  |  |  |
| PNC\tand\taffiliates | $5 | $4 | $4 |
| Barclays\tand\taffiliates | — | 5 | 14 |
| Registered\tinvestment\tcompanies/equity |  |  |  |
| method\tinvestees | 5,986 | 5,283 | 5,282 |
| Other | — | — | 3 |
| Total\tinvestment\tadvisory,\tadministration\tfees, |  |  |  |
| and\tsecurities\tlending\trevenue | 5,991 | 5,292 | 5,303 |
| Investment\tadvisory\tperformance\tfees | 185 | 120 | 54 |
| BlackRock\tSolutions\tand\tadvisory: |  |  |  |
| PNC\tand\taffiliates | 7 | 7 | 6 |
| Equity\tmethod\tinvestees | 11 | 13 | 15 |
| Other | 5 | 3 | — |
| Total\tBlackRock\tSolutions\tand\tadvisory | 23 | 23 | 21 |
| Other\trevenue: |  |  |  |
| PNC\tand\taffiliates | 3 | 3 | 3 |
| Barclays\tand\taffiliates | — | 11 | 35 |
| Equity\tmethod\tinvestees | 58 | 52 | 15 |
| Total\tother\trevenue | 61 | 66 | 53 |
| Total\trevenue\tfrom\trelated\tparties | $\t6,260 | $\t5,501 | $ \t5,431 |

The	Company	provides	investment	advisory	and	administration	services	to	its	open- and	closed-end	funds	and	other	commingled	or	pooled	funds	and	separate	accounts	in which	related	parties	invest.	In	addition,	the	Company	provides	investment	advisory and	administration	services	to	Barclays	and	PNC	and	its	affiliates	for	fees	based	on AUM.	Further,	the	Company	provides	risk	management	services	to	PNC.	The	Company records	its	investment	advisory	and	administration	fees	net	of	retrocessions.

# Aggregate	Expenses	for	Transactions	with	Related	Parties

Aggregate	expenses	included	in	the	consolidated	statements	of	income	for	transactions with	related	parties	are	as	follows:

|  |  | Year	ended	December	31, |  |
| :--- | :--- | :--- | :--- |
| (in\tmillions) | 2013 | 2012 | 2011 |
| Expenses\twith\trelated\tparties: |  |  |  |
| Distribution\tand\tservicing\tcosts |  |  |  |
| PNC\tand\taffiliates | $2 | $3 | $3 |
| Barclays\tand\taffiliates | — | 1 | 2 |
| Total\tdistribution\tand\tservicing\tcosts | 2 | 4 | 5 |
| Direct\tfund\texpenses |  |  |  |
| Barclays\tand\taffiliates | — | 4 | 8 |
| Total\tdirect\tfund\texpenses | — | 4 | 8 |
| General\tand\tadministration\texpenses |  |  |  |
| Barclays\tand\taffiliates | — | 5 | 15 |
| Other\tregistered\tinvestment\tcompanies | 50 | 49 | 42 |
| Other(1) | — | 33 | 3 |
| Total\tgeneral\tand\tadministration\texpenses | 50 | 87 | 60 |
| Total\texpenses\twith\trelated\tparties | $\t52 | $\t95 | $\t73 |

(1) Amount	in	2012	included	a	one-time	pre-tax	charge	of	$30	million	related	to	a	contribution	to	certain	of the	Company's	bank	managed	short-term	investment	funds	("STIFs").

# Certain	Agreements	and	Arrangements	with	Barclays	and	PNC

PNC.	On	February	27,	2009,	BlackRock	entered	into	an	amended	and	restated implementation	and	stockholder	agreement	with	PNC,	and	a	third	amendment	to	the share	surrender	agreement	with	PNC.	See	Note	19,	Capital	Stock,	for	further discussion.

The	changes	contained	in	the	amended	and	restated	stockholder	agreement	with	PNC, in	relation	to	the	prior	agreement,	among	other	things,	(i)	revised	the	definitions	of	"Fair Market	Value,"	"Ownership	Cap,"	"Ownership	Percentage,"	"Ownership	Threshold"	and "Significant	Stockholder";	and	(ii)	amended	or	supplemented	certain	other	provisions therein	to	incorporate	series	B	preferred	stock	and	series	C	preferred	stock, respectively.

The	amendment	to	the	share	surrender	agreement	with	PNC	provided	for	the substitution	of	series	C	preferred	stock	for	the	shares	of	common	stock	subject	to	the share	surrender	agreement.

In	June	2009,	in	connection	with	the	BGI	Transaction,	certain	additional	amendments were	made	to	the	amended	and	restated	stockholder	agreement	with	PNC.

The	amended	and	restated	stockholder	agreement	with	PNC	was	changed	to,	among other	things,	(i)	revise	the	definitions	of	"Ownership	Cap"	and	"Ownership	Threshold," (ii)	amend	or	supplement	certain	other	definitions	and	provisions	therein	to	incorporate series	D	participating	preferred	stock,	(iii)	provide	that	none	of	the	transfer	restriction provisions	set	forth	in	the	amended	and	restated	stockholder	agreement	with	PNC apply	to	the	shares	purchased	by	PNC	as	part	of	the	financing	for	the	BGI	Transaction, (iv)	amend	the	provision	relating	to	the	composition	of	BlackRock's	Board	of	Directors and	(v)	provide	that	the	amended	and	restated	stockholder	agreement	with	PNC	shall terminate	upon	the	later	of	(A)	the	five	year	anniversary	of	the	amended	and	restated stockholder	agreement	with	PNC	and	(B)	the	first	date	on	which	PNC	and	its	affiliates beneficially	own	less	than	5%	of	the	outstanding	BlackRock	capital	stock,	subject	to certain	other	conditions	specified	therein.

Barclays.	In	connection	with	the	completion	of	its	acquisition	of	BGI,	BlackRock	entered into	a	Stockholder	Agreement,	dated	as	of	December	1,	2009	(the	"Barclays Stockholder	Agreement"),	with	Barclays	and	Barclays	BR	Holdings	S.à.r.l.	("BR Holdings",	and	together	with	Barclays,	the	"Barclays	Parties").	Pursuant	to	the	terms	of the	Barclays	Stockholder	Agreement,	the	Barclays	Parties	agreed,	among	other	things, to	certain	transfer	and	voting	restrictions	with	respect	to	shares	of	BlackRock	common stock	and	preferred	stock	owned	by	them	and	their	affiliates,	to	limits	on	the	ability	of	the Barclays	Parties	and	their	affiliates	to	acquire	additional	shares	of	BlackRock	common stock	and	preferred	stock	and	to	certain	other	restrictions.	The	Barclays	Stockholder Agreement	was	terminated	on	May	29,	2012.

In	addition,	Barclays	and	certain	of	its	affiliates	have	been	engaged	by	the	Company	to provide	the	use	of	certain	indices	for	certain	BlackRock	investment	funds	and	for	a	fee to	provide	indemnification	to	clients	related	to	potential	losses	in	connection	with lending	of	client	securities.	For	the	five	months	ended	May	31,	2012,	and	the	full	year ended	December	31,	2011,	fees	incurred	for	these	agreements	were	$9	million	and	$18 million,	respectively,	and	were	recorded	within	direct	fund	expenses	and	general	and administration	expenses.

Receivables	and	Payables	with	Related	Parties.	Due	from	related	parties,	which	is included	within	other	assets	on	the	consolidated	statements	of	financial	condition	was $74	million	and	$77	million	at	December	31,	2013	and	2012,

respectively,	and	primarily	represented	receivables	for	investment	advisory	and administration	services	provided	by	BlackRock,	and	other	receivables	from	certain investment	products	managed	by	BlackRock.	Due	from	related	parties	at	December	31, 2013	and	2012	included	$60	million	and	$68	million,	respectively,	due	from	certain funds.

Accounts	receivable	at	December	31,	2013	and	2012	included	$745	million	and	$629 million,	respectively,	related	to	receivables	from	BlackRock	mutual	funds,	including iShares,	for	investment	advisory	and	administration	services.

Due	to	related	parties,	which	is	included	within	other	liabilities	on	the	consolidated statements	of	financial	condition,	was	$13	million	and	$14	million	at	December	31,	2013 and	2012,	respectively,	and	primarily	represented	payables	to	certain	investment products	managed	by	BlackRock.

# 17.	Net	Capital	Requirements

The	Company	is	required	to	maintain	net	capital	in	certain	regulated	subsidiaries	within a	number	of	jurisdictions,	which	is	partially	maintained	by	retaining	cash	and	cash equivalent	investments	in	those	subsidiaries	or	jurisdictions.	As	a	result,	such subsidiaries	of	the	Company	may	be	restricted	in	their	ability	to	transfer	cash	between different	jurisdictions	and	to	their	parents.	Additionally,	transfers	of	cash	between international	jurisdictions,	including	repatriation	to	the	United	States,	may	have	adverse tax	consequences	that	could	discourage	such	transfers.

Banking	Regulatory	Requirements.	BlackRock	Institutional	Trust	Company,	N.A. ("BTC"),	a	wholly	owned	subsidiary	of	the	Company,	is	chartered	as	a	national	bank whose	powers	are	limited	to	trust	activities.	BTC	is	subject	to	regulatory	capital requirements	administered	by	the	Office	of	the	Comptroller	of	the	Currency.	Failure	to meet	minimum	capital	requirements	can	initiate	certain	mandatory	and	possibly additional	discretionary	actions	by	regulators	that,	if	undertaken,	could	have	a	direct material	effect	on	the	consolidated	financial	statements.	Under	the	capital	adequacy guidelines	and	the	regulatory	framework	for	prompt	corrective	action,	BTC	must	meet specific	capital	guidelines	that	invoke	quantitative	measures	of	BTC's	assets,	liabilities, and	certain	off-balance	sheet	items	as	calculated	under	the	regulatory	accounting practices.	BTC's	capital	amounts	and	classification	are	also	subject	to	qualitative judgments	by	the	regulators	about	components,	risk	weightings	and	other	factors.

Quantitative	measures	established	by	regulators	to	ensure	capital	adequacy	require BTC	to	maintain	a	minimum	Tier	1	capital	and	Tier	1	leverage	ratio,	as	well	as	Tier	1 and	total	risk-based	capital	ratios.	Based	on	BTC's	calculations	as	of	December	31, 2013	and	2012,	it	exceeded	the	applicable	capital	adequacy	requirements.

|  | Actual |  | For	Capital<br>Adequacy<br>Purposes |  | To	Be	Well<br>Capitalized<br>Under	Prompt<br>Corrective	Action<br>Provisions | To	Be	Well<br>Capitalized<br>Under	Prompt<br>Corrective	Action<br>Provisions |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| (in\tmillions) | Amount | Ratio | Amount | Ratio | Amount | Ratio |
| December\t31,\t2013 |  |  |  |  |  |  |
| Total\tcapital\t(to\trisk\tweighted\tassets) | $660 | \t112.7% | $47 | 8.0% | $59 | \t 10.0% |
| Tier\t1\tcapital\t(to\trisk\tweighted\tassets) | $660 | \t112.7% | $23 | 4.0% | $35 | 6.0% |
| Tier\t1\tcapital\t(to\taverage\tassets) | $660 | 63.4% | $42 | 4.0% | $52 | 5.0% |
| December\t31,\t2012 |  |  |  |  |  |  |
| Total\tcapital\t(to\trisk\tweighted\tassets) | $633 | 99.1% | $51 | 8.0% | $64 | \t 10.0% |
| Tier\t1\tcapital\t(to\trisk\tweighted\tassets) | $633 | 99.1% | $26 | 4.0% | $38 | 6.0% |
| Tier\t1\tcapital\t(to\taverage\tassets) | $\t633 | 49.7% | $\t51 | 4.0% | $\t64 | 5.0% |

Broker-dealers.	BlackRock	Investments,	LLC	and	BlackRock	Execution	Services	are registered	broker-dealers	and	wholly	owned	subsidiaries	of	BlackRock	that	are	subject to	the	Uniform	Net	Capital	requirements	under	the	Securities	Exchange	Act	of	1934, which	requires	maintenance	of	certain	minimum	net	capital	levels.

Capital	Requirements.	At	December	31,	2013	and	2012,	the	Company	was	required	to maintain	approximately	$1.1	billion	and	$1.2	billion,	respectively,	in	net	capital	in	certain regulated	subsidiaries,	including	BTC,	entities	regulated	by	the	Financial	Conduct Authority	and	Prudential	Regulation	Authority	in	the	United	Kingdom,	and	the Company's	broker-dealers.	The	Company	was	in	compliance	with	all	applicable regulatory	net	capital	requirements.

# 18.	Accumulated	Other	Comprehensive	Income	(Loss)

The	following	table	presents	changes	in	AOCI	by	component	for	2013:

|  | Unrealized	gains |  | Foreign |  |
| :--- | :--- | :--- | :--- | :--- |
|  | (losses)\ton |  | currency |  |
|  | available-for-sale |  | translation |  |
| (in\tmillions) | investments | Benefit\tplans | adjustments | Total(1) |
| December\t31,\t2012 | $16 | $(4) | $(71) | $(59) |
| Other\tcomprehensive\tincome\t(loss)\tbefore\treclassifications(2) | 4 | 10 | 23 | 37 |
| Amount\treclassified\tfrom\tAOCI(3) | (13) | — | — | (13) |
| Net\tother\tcomprehensive\tincome\t(loss)\tfor\t2013 | (9) | 10 | 23 | 24 |
| December\t31,\t2013 | $7 | $6 | $(48) | $(35) |

(1) All	amounts	are	net	of	tax.

(2) The	tax	benefit	(expense)	was	not	material	for	2013.

(3) The	tax	benefit	(expense)	was	not	material	for	2013.	The	pre-tax	amount	reclassified	from	AOCI	was	included	in	net	gain	(loss)	on	investments	on	the	consolidated	statements	of	income.

# 19.	Capital	Stock

May	2011	Barclays	Sale	and	Conversion.	In	May	2011,	2,356,750	shares	of	Series	B Preferred	owned	by	Barclays	were	automatically	converted	to	shares	of	common	stock upon	their	disposition.

# June	2011	Bank	of	America	Stock	Repurchase	Agreement.	On	June	1,	2011,

BlackRock	completed	its	repurchase	of	Bank	of	America's	remaining	ownership	interest of	13,562,878	Series	B	Preferred	for	$2.545	billion,	or	$187.65	per	share.

September	2011	Institutional	Investor	Capital	Exchange.	In	September	2011,	an institutional	investor	exchanged	2,860,188	shares	of	Series	B	Preferred	for	common shares.

# September	2011	PNC	Capital	Contribution.	In	September	2011,	PNC	surrendered	to

BlackRock	approximately	1.3	million	shares	of	BlackRock	Series	C	Preferred	to	fund certain	LTIP	awards	in	accordance	with	the	share	surrender	agreement	between	PNC and	BlackRock.

# May	2012	Barclays	Sale	and	Capital	Exchange.	BlackRock	completed	the	secondary

offering	of	26,211,335	shares	of	common	stock	held	by	Barclays	at	a	price	of	$160.00 per	share,	which	included	23,211,335	shares	of	common	stock	issued	upon	the conversion	of	Series	B	Preferred	by	a	subsidiary	of	Barclays.

Upon	completion	of	this	offering,	BlackRock	repurchased	6,377,552	shares	directly from	Barclays	outside	the	publicly	announced	share	repurchase	program	at	a	price	of $156.80	per	share	(consisting	of	6,346,036	of	Series	B	Preferred	and	31,516	shares	of common	stock).	The	total	transactions,	including	the	full	exercise	of	the	underwriters' option	to	purchase	2,621,134	additional	shares	in	the	secondary	offering,	amounted	to 35,210,021	shares,	resulting	in	Barclays	exiting	its	entire	ownership	position	in BlackRock.

May	2012	PNC	Capital	Exchange.	In	May	2012,	PNC	exchanged	2,000,000	shares	of Series	B	Preferred	for	an	equal	number	of	shares	of	common	stock.

Other	Changes.	In	September	and	October	2012,	593,786	and	2,594,070	shares	of Series	B	Preferred,	respectively,	converted	into	an	equal	number	of	shares	of	common stock.

# January	2013	PNC	Capital	Contribution.	In	January	2013,	PNC	surrendered	to

BlackRock	205,350	shares	of	BlackRock	Series	C	Preferred	to	fund	certain	LTIP awards	in	accordance	with	the	share	surrender	agreement	between	PNC	and BlackRock.

# Cash	Dividends	for	Common	and	Preferred	Shares	/	RSUs.	During	2013,	2012	and

Share	Repurchase	Approvals.	In	January	2013,	the	Board	of	Directors	(the	"Board") approved	an	increase	in	the	availability	under	the	Company's	existing	share	repurchase program	to	allow	for	the	repurchase	of	up	to	10.2	million	shares	of	BlackRock	common stock.	The	Company	repurchased	3.7	million	common	shares	in	open	market- transactions	under	the	share	repurchase	program	for	approximately	$1.0	billion	during 2013.	At	December	31,	2013,	there	were	6.5	million	shares	still	authorized	to	be repurchased.

The	Company's	common	and	preferred	shares	issued	and	outstanding	and	related	activity	consist	of	the	following:

|  |  |  | Shares	Issued |  |  | Shares	Outstanding | Shares	Outstanding |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | Common\nShares | Escrow\nCommon\nShares | Treasury\nCommon\nShares | Series\tB\nPreferred | Series\tC\nPreferred | Common\nShares | Series\tB\nPreferred | Series\tC\nPreferred |
| December\t31,\t2010 | \t\t\t131,923,624 | (3,603) | (703,460) | \t 57,108,553 | 2,866,439 | \t131,216,561 | \t 57,108,553 | 2,866,439 |
| Exchange\tof\tSeries\tB\tPreferred\tfor\tcommon\tshares | 5,216,938 | — | — | (5,216,938) | — | 5,216,938 | (5,216,938) | — |
| Shares\trepurchased | — | — | (618,000) | \t(13,562,878) | — | (618,000) | \t(13,562,878) | — |
| Net\tissuance\tof\tcommon\tshares\trelated\tto\temployee\tstock\ttransactions\tand |  |  |  |  |  |  |  |  |
| convertible\tdebt\tconversions | 2,739,818 | — | (92,182) | — | — | 2,647,636 | — | — |
| PNC\tLTIP\tcapital\tcontribution | — | — | — | — | \t(1,349,202) | — | — | \t(1,349,202) |
| December\t31,\t2011 | \t\t\t139,880,380 | (3,603) | \t(1,413,642) | \t 38,328,737 | 1,517,237 | \t138,463,135 | \t 38,328,737 | 1,517,237 |
| Exchange\tof\tSeries\tB\tPreferred\tfor\tcommon\tshares | 31,159,513 | — | — | \t(31,159,513) | — | 31,159,513 | \t(31,159,513) | — |
| Shares\trepurchased | (31,516) | — | \t(2,726,600) | (6,346,036) | — | (2,758,116) | (6,346,036) | — |
| Net\tissuance\tof\tcommon\tshares\trelated\tto\temployee\tstock\ttransactions | 247,411 | — | 1,763,361 | — | — | 2,010,772 | — | — |
| Release\tof\tcommon\tshares\tfrom\tescrow | (3,603) | 3,603 | — | — | — | — | — | — |
| December\t31,\t2012 | \t\t\t171,252,185 | — | \t(2,376,881) | 823,188 | 1,517,237 | \t168,875,304 | 823,188 | 1,517,237 |
| Shares\trepurchased | — | — | \t(3,689,845) | — | — | (3,689,845) | — | — |
| Net\tissuance\tof\tcommon\tshares\trelated\tto\temployee\tstock\ttransactions | — | — | 1,404,229 | — | — | 1,404,229 | — | — |
| PNC\tLTIP\tcapital\tcontribution | — | — | — | — | (205,350) | — | — | (205,350) |
| December\t31,\t2013 | \t\t\t171,252,185 | — | \t(4,662,497) | 823,188 | 1,311,887 | \t166,589,688 | 823,188 | 1,311,887 |

# 20.	Restructuring	Charges

During	2011,	the	Company	reduced	its	workforce	globally	by	approximately	3.4%.	This action	was	the	result	of	a	cost-cutting	initiative	designed	to	streamline	operations, enhance	competitiveness	and	better	position	the	Company	in	the	asset	management marketplace.	The	Company	recorded	a	pre-tax	restructuring	charge	of	approximately $32	million	($22	million	after-tax)	during	2011.	This	charge	was	comprised	of	$24 million	of	severance	and	associated	outplacement	costs	and	$8	million	of	expenses related	to	the	accelerated	amortization	of	previously	granted	equity-based compensation	awards.

The	following	table	presents	a	rollforward	of	the	Company's	restructuring	liability,	which is	included	within	other	liabilities	on	the	consolidated	statements	of	financial	condition:

(1) Liability	amount	as	of	December	31,	2010	related	to	a	pre-tax	restructuring	charge	of	$22	million recorded	during	2009.

# 21.	Income	Taxes

| (in	millions) | 2013 | 2012 | 2011 |
| :--- | :--- | :--- | :--- |
| Current\tincome\ttax\texpense: |  |  |  |
| Federal | $869 | $856 | $693 |
| State\tand\tlocal | 39 | 49 | 54 |
| Foreign | 307 | 186 | 186 |
| Total\tnet\tcurrent\tincome\ttax\texpense | 1,215 | 1,091 | 933 |
| Deferred\tincome\ttax\texpense\t(benefit): |  |  |  |
| Federal | (68) | 4 | 52 |
| State\tand\tlocal | 13 | 13 | (112) |
| Foreign | (138) | (78) | (77) |
| Total\tnet\tdeferred\tincome\ttax\texpense\t(benefit) | (193) | (61) | (137) |
| Total\tincome\ttax\texpense | $\t1,022 | $\t1,030 | $\t\t796 |

Income	tax	expense	has	been	based	on	the	following	components	of	income	before taxes,	less	net	income	(loss)	attributable	to	noncontrolling	interests:

| (in	millions) | 2013 | 2012 | 2011 |
| :--- | :--- | :--- | :--- |
| Domestic | $ 2,814 | $2,690 | $2,397 |
| Foreign | 1,140 | 798 | 736 |
| Total | $\t3,954 | $\t3,488 | $ \t3,133 |

The	foreign	income	before	taxes	includes	countries	that	have	statutory	tax	rates	that	are lower	than	the	U.S.	federal	statutory	tax	rate	of	35%,	such	as	the	United	Kingdom, Luxembourg,	Canada	and	the	Netherlands.

A	reconciliation	of	income	tax	expense	with	expected	federal	income	tax	expense	computed	at	the	applicable	federal	income	tax	rate	of	35%	is	as	follows:

| (in	millions) | 2013 | % | 2012 | % | 2011 | % |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| Statutory\tincome\ttax\texpense | $1,383 | \t 35% | $1,221 | \t 35% | $\t1,097 | 35% |
| Increase\t(decrease)\tin\tincome\ttaxes\tresulting\tfrom: |  |  |  |  |  |  |
| State\tand\tlocal\ttaxes\t(net\tof\tfederal\tbenefit) | 39 | 1 | 49 | 2 | 59 | 2 |
| Impact\tof\tforeign,\tstate,\tand\tlocal\ttax\trate\tchanges\ton\tdeferred\ttaxes | (69) | (2) | (50) | (2) | (188) | (6) |
| Effect\tof\tforeign\ttax\trates | (329) | (8) | (221) | (5) | (197) | (6) |
| Other | (2) | \t — | 31 | \t — | 25 | \t — |
| Income\ttax\texpense | $\t1,022 | \t 26% | $\t1,030 | \t 30% | $796 | 25% |

Deferred	income	taxes	are	provided	for	the	effects	of	temporary	differences	between the	tax	basis	of	an	asset	or	liability	and	its	reported	amount	in	the	consolidated	financial statements.	These	temporary	differences	result	in	taxable	or	deductible	amounts	in future	years.

The	components	of	deferred	income	tax	assets	and	liabilities	are	shown	below:

|  | December	31, |  |
| :--- | :--- | :--- |
| (in\tmillions) | 2013 | 2012 |
| Deferred\tincome\ttax\tassets: |  |  |
| Compensation\tand\tbenefits | $345 | $355 |
| Unrealized\tinvestment\tlosses | 99 | 71 |
| Loss\tcarryforwards | 42 | 81 |
| Foreign\ttax\tcredit\tcarryforwards | 28 | — |
| Other | 290 | 222 |
| Gross\tdeferred\ttax\tassets | 804 | 729 |
| Less:\tdeferred\ttax\tvaluation\tallowances | (48) | (95) |
| Deferred\ttax\tassets\tnet\tof\tvaluation\tallowances | 756 | 634 |
| Deferred\tincome\ttax\tliabilities: |  |  |
| Goodwill\tand\tacquired\tindefinite-lived\tintangibles | 5,594 | 5,656 |
| Acquired\tfinite-lived\tintangibles | 110 | 158 |
| Other | 133 | 109 |
| Gross\tdeferred\ttax\tliabilities | \t\t5,837 | \t\t5,923 |
| Net\tdeferred\ttax\t(liabilities) | $ (5,081) | $ (5,289) |

Deferred	income	tax	assets	and	liabilities	are	recorded	net	when	related	to	the	same tax	jurisdiction.	At	December	31,	2013,	the	Company	recorded	on	the	consolidated statement	of	financial	condition	deferred	income	tax	assets,	within	other	assets,	and deferred	income	tax	liabilities	of	$4	million	and	$5,085	million,	respectively.	At December	31,	2012,	the	Company	recorded	on	the	consolidated	statement	of	financial condition	deferred	income	tax	assets,	within	other	assets,	and	deferred	income	tax liabilities	of	$4	million	and	$5,293	million,	respectively.

During	2013,	tax	legislation	enacted	in	the	United	Kingdom	and	domestic	state	tax	law changes	resulted	in	a	$69	million	net	noncash	benefit	related	to	the	revaluation	of certain	deferred	income	tax	liabilities.	During	2012,	tax	legislation	enacted	in	the	United Kingdom	and	the	state	and	local	income	tax	effect	resulting	from	changes	in	the Company's	organizational	structure	primarily	resulted	in	a	$50	million	net	noncash benefit	related	to	the	revaluation	of	certain	deferred	income	tax	liabilities.

The	Company	had	a	deferred	income	tax	asset	related	to	unrealized	investment	losses of	approximately	$99	million	and	$71	million	at	December	31,	2013	and	2012, respectively,	reflecting	the	Company's	conclusion	that	based	on	the	weight	of	available evidence,	it	is	more	likely	than	not	that	the	deferred	tax	asset	will	be	realized.	U.S. Federal	realized	capital	losses	may	be	carried	back	three	years	and	carried	forward	five years	and	offset	against	realized	capital	gains	for	federal	income	tax	purposes.	The Company	expects	to	hold	certain	fixed	income	securities	over	a	period	sufficient	for them	to	recover	their	unrealized	losses,	and	to	generate	future	capital	gains	sufficient	to offset	the	unrealized	capital	losses.

At	December	31,	2013	and	2012,	the	Company	had	available	state	net	operating	loss carryforwards	of	$935	million	and	$842	million,	respectively,	which	will	begin	to	expire	in 2017.	At	December	31,	2013	and	December	31,	2012,	the	Company	had	foreign	net operating	loss	carryforwards	of	$109	million	and	$152	million,	respectively,	of	which	$11 million	will	begin	to	expire	in	2017	and	the	balance	will	carry	forward

indefinitely.	At	December	31,	2013,	the	Company	had	foreign	tax	credit	carryforwards for	income	tax	purposes	of	$28	million	which	will	begin	to	expire	in	2023.

At	December	31,	2013	and	2012,	the	Company	had	$48	million	and	$95	million	of valuation	allowances	for	deferred	income	tax	assets,	respectively,	recorded	on	the consolidated	statements	of	financial	condition.	The	year-over-year	decrease	in	the valuation	allowance	primarily	related	to	the	realization	of	tax	loss	carryforwards	and certain	foreign	deferred	income	tax	assets.

Goodwill	recorded	in	connection	with	the	Quellos	Transaction	has	been	reduced	during the	period	by	the	amount	of	tax	benefit	realized	from	tax-deductible	goodwill.	See	Note 9,	Goodwill,	for	further	discussion.

Current	income	taxes	are	recorded	net	on	the	consolidated	statements	of	financial condition	when	related	to	the	same	tax	jurisdiction.	At	December	31,	2013,	the Company	had	current	income	taxes	receivable	and	payable	of	$89	million	and	$168 million,	respectively,	recorded	in	other	assets	and	accounts	payable	and	accrued liabilities,	respectively.	At	December	31,	2012,	the	Company	had	current	income	taxes receivable	and	payable	of	$102	million	and	$121	million,	respectively,	recorded	in	other assets	and	accounts	payable	and	accrued	liabilities,	respectively.

The	Company	does	not	provide	deferred	taxes	on	the	excess	of	the	financial	reporting over	tax	basis	on	its	investments	in	foreign	subsidiaries	that	are	essentially	permanent in	duration.	The	excess	totaled	$3,074	million	and	$2,125	million	at	December	31,	2013 and	2012,	respectively.	The	determination	of	the	additional	deferred	income	taxes	on the	excess	has	not	been	provided	because	it	is	not	practicable	due	to	the	complexities associated	with	its	hypothetical	calculation.

The	following	tabular	reconciliation	presents	the	total	amounts	of	gross	unrecognized tax	benefits:

|  | Year	ended	December	31, | Year	ended	December	31, |  |
| :--- | :--- | :--- | :--- |
| (in\tmillions) | 2013 | 2012 | 2011 |
| Balance\tat\tJanuary\t1 | $404 | $349 | $307 |
| Additions\tfor\ttax\tpositions\tof\tprior\tyears | 11 | 4 | 22 |
| Reductions\tfor\ttax\tpositions\tof\tprior\tyears | (5) | (1) | (1) |
| Additions\tbased\ton\ttax\tpositions\trelated\tto |  |  |  |
| current\tyear | 67 | 69 | 46 |
| Lapse\tof\tstatute\tof\tlimitations | — | — | — |
| Settlements | (12) | (29) | (25) |
| Positions\tassumed\tin\tacquisitions | 2 | 12 | — |
| Balance\tat\tDecember\t31 | $\t467 | $\t404 | $\t349 |

Included	in	the	balance	of	unrecognized	tax	benefits	at	December	31,	2013,	2012	and 2011,	respectively,	are	$304	million,	$250	million	and	$226	million	of	tax	benefits	that,	if recognized,	would	affect	the	effective	tax	rate.

The	Company	recognizes	interest	and	penalties	related	to	income	tax	matters	as	a component	of	income	tax	expense.	Related	to	the	unrecognized	tax	benefits	noted above,	the	Company	accrued	interest	and	penalties	of	$(1)	million	during	2013	and	in total,	as	of	December	31,	2013,	had	recognized	a	liability	for	interest	and	penalties	of $68	million.	The	Company	accrued	interest	and	penalties	of

$3	million	during	2012	and	in	total,	as	of	December	31,	2012,	had	recognized	a	liability for	interest	and	penalties	of	$69	million.	The	Company	accrued	interest	and	penalties	of $10	million	during	2011	and	in	total,	as	of	December	31,	2011,	had	recognized	a	liability for	interest	and	penalties	of	$66	million.	Pursuant	to	the	Amended	and	Restated	Stock Purchase	Agreement,	the	Company	has	been	indemnified	by	Barclays	for	$50	million and	Guggenheim	for	$6	million	of	unrecognized	tax	benefits.

BlackRock	is	subject	to	U.S.	federal	income	tax,	state	and	local	income	tax,	and	foreign income	tax	in	multiple	jurisdictions.	Tax	years	after	2007	remain	open	to	U.S.	federal income	tax	examination.	The	IRS	is	in	the	process	of	concluding	its	audit	of	the	2008 and	2009	years	and	its	case	must	be	approved	by	The	Joint	Committee	on	Taxation. The	BGI	group's	tax	years	2007	through	December	1,	2009	are	under	IRS	examination. The	IRS	is	in	the	process	of	concluding	its	audit	and	its	case	must	be	approved	by	The Joint	Committee	on	Taxation.

The	Company	is	currently	under	audit	in	several	state	and	local	jurisdictions.	The significant	state	and	local	income	tax	examinations	are	in	California	for	tax	years	2009 through	2010,	New	York	State	and	New	York	City	for	tax	years	2009	through	2011,	and New	Jersey	for	tax	years	2007	through	2009.	No	state	and	local	income	tax	audits cover	years	earlier	than	2007.	No	state	and	local	income	tax	audits	are	expected	to result	in	an	assessment	material	to	BlackRock's	consolidated	financial	statements.

Her	Majesty's	Revenue	and	Customs	("HMRC")	commenced	its	United	Kingdom income	tax	audit	of	various	U.K.	BlackRock	subsidiaries	in	respect	of	2009	through 2011	tax	years.	While	the	impact	on	the	consolidated	financial	statements	is undetermined,	it	is	not	expected	to	be	material.

At	December	31,	2013,	it	is	reasonably	possible	the	total	amounts	of	unrecognized	tax benefits	will	change	within	the	next	twelve	months	due	to	completion	of	tax	authorities' exams	or	the	expiration	of	statues	of	limitations.	Management	estimates	that	the existing	liability	for	uncertain	tax	positions	could	decrease	by	approximately	$110	million to	$135	million	within	the	next	twelve	months.

# 22.	Earnings	Per	Share

The	following	table	sets	forth	the	computation	of	basic	and	diluted	EPS	for	2013	under the	treasury	stock	method:

| (	in	millions,	except	share	data) | 2013 |
| :--- | :--- |
| Net\tincome\tattributable\tto\tBlackRock | $2,932 |
| Basic\tweighted-average\tshares\toutstanding | \t170,185,870 |
| Dilutive\teffect\tof\tnonparticipating\tRSUs\tand\tstock\toptions | 3,643,032 |
| Total\tdiluted\tweighted-average\tshares\toutstanding | 173,828,902 |
| Basic\tearnings\tper\tshare | $17.23 |
| Diluted\tearnings\tper\tshare | $16.87 |

The	following	table	sets	forth	the	computation	of	basic	and	diluted	EPS	for	2012	and 2011	under	the	two-class	method:

| (in	millions,	except	per	share	data) | 2012 | 2011 |
| :--- | :--- | :--- |
| Net\tincome\tattributable\tto\tBlackRock | $2,458 | $2,337 |
| Less:\nDividends\tdistributed\tto\tcommon\nshares | 1,059 | 1,004 |
| Dividends\tdistributed\tto |  |  |
| participating\tRSUs | 1 | 10 |
| Undistributed\tnet\tincome\tattributable |  |  |
| to\tBlackRock | 1,398 | 1,323 |
| Percentage\tof\tundistributed\tnet |  |  |
| income\tallocated\tto\tcommon |  |  |
| shares(1) | 99.9% | 99.1% |
| Undistributed\tnet\tincome\tallocated\tto |  |  |
| common\tshares | 1,396 | 1,311 |
| Plus: |  |  |
| Common\tshare\tdividends | 1,059 | 1,004 |
| Net\tincome\tattributable\tto\tcommon |  |  |
| shares | $2,455 | $2,315 |
| Basic\tweighted-average\tshares |  |  |
| outstanding | 174,961,018 | \t184,265,367 |
| Dilutive\teffect\tof\tnonparticipating |  |  |
| RSUs\tand\tstock\toptions | 3,056,661 | 2,826,292 |
| Dilutive\teffect\tof\tconvertible\tdebt | — | 24,751 |
| Total\tdiluted\tweighted-average |  |  |
| shares\toutstanding | \t178,017,679 | 187,116,410 |
| Basic\tearnings\tper\tshare | $14.03 | $12.56 |
| Diluted\tearnings\tper\tshare | $13.79 | $12.37 |

(1) Allocation	to	common	stockholders	was	based	on	the	total	of	common	shares	and	participating securities	(which	represent	unvested	RSUs	that	contain	nonforfeitable	rights	to	dividends).	For	2012 and	2011,	average	outstanding	participating	securities	were	0.2	million	and	1.8	million,	respectively.

For	2012	and	2011,	449	and	5,125	RSUs,	respectively,	were	excluded	from	the calculation	of	diluted	EPS	because	to	include	them	would	have	an	anti-dilutive	effect. There	were	no	anti-dilutive	RSUs	for	2013.	In	addition,	there	were	no	anti-dilutive	stock options	for	2013,	2012	and	2011.

# 23.	Segment	Information

The	following	table	illustrates	investment	advisory,	administration	fees,	securities lending	revenue	and	performance	fees,	BlackRock	Solutions	and	advisory	revenue, distribution	fees	and	other	revenue	for	2013,	2012	and	2011.

| (in	millions) | 2013 | 2012 | 2011 |
| :--- | :--- | :--- | :--- |
| Equity | $4,816 | $4,334 | $4,447 |
| Fixed\tincome | 1,996 | 1,900 | 1,659 |
| Multi-asset | 1,063 | 972 | 914 |
| Alternatives | 1,104 | 968 | 864 |
| Cash\tmanagement | 321 | 361 | 383 |
| Total\tinvestment\tadvisory,\tadministration |  |  |  |
| fees,\tsecurities\tlending\trevenue\tand |  |  |  |
| performance\tfees | 9,300 | 8,535 | 8,267 |
| BlackRock\tSolutions\tand\tadvisory | 577 | 518 | 510 |
| Distribution\tfees | 73 | 71 | 100 |
| Other\trevenue | 230 | 213 | 204 |
| Total\trevenue | $\t10,180 | $ \t9,337 | $ \t9,081 |

The	following	table	illustrates	total	revenue	for	2013,	2012	and	2011	by	geographic region.	These	amounts	are	aggregated	on	a	legal	entity	basis	and	do	not	necessarily reflect	where	the	customer	resides.

| Revenue | 2013 | 2012 | 2011 |
| :--- | :--- | :--- | :--- |
| Americas | $6,829 | $6,429 | $6,064 |
| Europe | 2,832 | 2,460 | 2,517 |
| Asia-Pacific | 519 | 448 | 500 |
| Total\trevenue | $\t10,180 | $ \t9,337 | $ \t9,081 |

The	following	table	illustrates	long-lived	assets	that	consist	of	goodwill	and	property	and equipment	at	December	31,	2013,	2012	and	2011	by	geographic	region.	These amounts	are	aggregated	on	a	legal	entity	basis	and	do	not	necessarily	reflect	where	the asset	is	physically	located.

| Long-lived	Assets | 2013 | 2012 | 2011 |
| :--- | :--- | :--- | :--- |
| Americas | $ 13,204 | $ 13,238 | $13,133 |
| Europe | 214 | 166 | 123 |
| Asia-Pacific | 87 | 63 | 73 |
| Total\tlong-lived\tassets | $\t13,505 | $\t13,467 | $ \t13,329 |

Americas	primarily	is	comprised	of	the	United	States,	Canada,	Brazil,	Chile	and Mexico,	while	Europe	primarily	is	comprised	of	the	United	Kingdom.	Asia-Pacific	is comprised	of	Japan,	Australia,	Singapore,	Hong	Kong,	Taiwan,	Korea,	India,	Malaysia and	China.

# 24.	Selected	Quarterly	Financial	Data	(unaudited)

(in	millions,	except	per	share	data)

| 2013 | 1st	Quarter | 2nd	Quarter(1) | 3rd	Quarter(2) | 4th	Quarter |
| :--- | :--- | :--- | :--- | :--- |
| Revenue | $2,449 | $2,482 | $2,472 | $2,777 |
| Operating\tincome | $909 | $849 | $966 | $1,133 |
| Net\tincome | $666 | $706 | $729 | $850 |
| Net\tincome\tattributable\tto\tBlackRock | $632 | $729 | $730 | $841 |
| Earnings\tper\tshare\tattributable\tto\tBlackRock,\tInc.\tcommon\tstockholders: |  |  |  |  |
| Basic | $3.69 | $4.27 | $4.30 | $4.98 |
| Diluted | $3.62 | $4.19 | $4.21 | $4.86 |
| Weighted-average\tcommon\tshares\toutstanding: |  |  |  |  |
| Basic | 171,301,800 | 170,648,731 | 169,811,633 | 169,010,606 |
| Diluted | \t174,561,132 | \t173,873,583 | \t173,371,508 | \t172,999,529 |
| Dividend\tdeclared\tper\tshare | $1.68 | $1.68 | $1.68 | $1.68 |
| Common\tstock\tprice\tper\tshare: |  |  |  |  |
| High | $258.70 | $291.69 | $286.62 | $316.47 |
| Low | $212.77 | $245.30 | $255.26 | $262.75 |
| Close | $256.88 | $256.85 | $270.62 | $316.47 |

| 2012 | 1st	Quarter | 2nd	Quarter | 3rd	Quarter(3) | 4th	Quarter(4) |
| :--- | :--- | :--- | :--- | :--- |
| Revenue | $2,249 | $2,229 | $2,320 | $2,539 |
| Operating\tincome | $815 | $829 | $875 | $1,005 |
| Net\tincome | $575 | $560 | $655 | $650 |
| Net\tincome\tattributable\tto\tBlackRock | $572 | $554 | $642 | $690 |
| Earnings\tper\tshare\tattributable\tto\tBlackRock,\tInc.\tcommon\tstockholders: |  |  |  |  |
| Basic | $3.19 | $3.13 | $3.72 | $4.02 |
| Diluted | $3.14 | $3.08 | $3.65 | $3.93 |
| Weighted-average\tcommon\tshares\toutstanding: |  |  |  |  |
| Basic | \t179,022,840 | \t177,010,239 | \t172,359,141 | \t171,518,278 |
| Diluted | 181,917,864 | 179,590,702 | 175,450,532 | 175,176,037 |
| Dividend\tdeclared\tper\tshare | $1.50 | $1.50 | $1.50 | $1.50 |
| Common\tstock\tprice\tper\tshare: |  |  |  |  |
| High | $205.60 | $206.57 | $183.00 | $209.29 |
| Low | $179.13 | $163.37 | $164.06 | $177.17 |
| Close | $204.90 | $169.82 | $178.30 | $206.71 |

(1) In	the	second	quarter	of	2013	in	connection	with	the	PennyMac	IPO	the	Company	recorded	a	noncash,	nonoperating	pre-tax	gain	of	$39	million	related	to	the	carrying	value	of	its	equity	method	investment.	In connection	with	the	Charitable	Contribution	the	Company	recorded	an	expense	of	$124	million	and	a	noncash,	nonoperating	pre-tax	gain	of	$80	million	related	to	the	contributed	investment.	For	further	information,	see Note	11,	Other	Assets.

In	addition,	the	second	quarter	of	2013	included	approximately	a	$57	million	tax	benefit	recognized	in	connection	with	the	Charitable	Contribution	and	a	tax	benefit	of	approximately	$29	million,	primarily	due	to	the realization	of	tax	loss	carryforwards.

(2) The	third	quarter	of	2013	included	a	$64	million	net	noncash	tax	benefit	primarily	related	to	the	revaluation	of	certain	deferred	income	tax	liabilities,	including	the	effect	of	legislation	enacted	in	the	United	Kingdom	and domestic	state	and	local	income	tax	changes.

(3) The	third	quarter	of	2012	included	a	$30	million	net	noncash	tax	benefit	related	to	the	revaluation	of	certain	deferred	income	tax	liabilities,	including	the	effect	of	legislation	enacted	in	the	United	Kingdom,	and	the	state and	local	income	tax	effect	resulting	from	changes	in	the	Company's	organizational	structure.

(4) The	fourth	quarter	of	2012	included	a	one-time	pre-tax	$30	million	charge	related	to	a	contribution	to	certain	of	the	Company's	STIFs	and	$20	million	of	noncash	tax	benefits	primarily	associated	with	revaluation	of certain	deferred	tax	liabilities.

# 25.	Subsequent	Events

Dividend	Approval.	On	January	15,	2014,	the	Board	approved	BlackRock's	quarterly dividend	of	$1.93	to	be	paid	on	March	24,	2014	to	stockholders	of	record	on	March	7, 2014.

Other.	The	Company	conducted	a	review	for	additional	subsequent	events	and determined	that	no	additional	subsequent	events	had	occurred	that	would	require accrual	or	additional	disclosures.

Exhibit	No. Description

				3.1(1) Amended	and	Restated	Certificate	of	Incorporation	of	BlackRock.

				3.2(2) Certificate	of	Amendment	to	the	Amended	and	Restated	Certificate	of	Incorporation	of	BlackRock,	Inc.

				3.3(29) Amended	and	Restated	Bylaws	of	BlackRock.

				4.1(5) Specimen	of	Common	Stock	Certificate.

		10.1(11) BlackRock,	Inc.	Amended	and	Restated	1999	Stock	Award	and	Incentive	Plan.	+

		10.10(5) Registration	Rights	Agreement,	dated	as	of	September	29,	2006,	among	BlackRock,	Merrill	Lynch	&	Co.,	Inc.	and	the	PNC	Financial	Service	Group,	Inc.

		10.18(27) Amendment	No.	2,	dated	as	of	March	28,	2013,	by	and	among	BlackRock,	Inc.,	certain	of	its	subsidiaries,	Wells	Fargo	Bank,	National	Association,	as administrative	agent,	swingline	lender,	issuing	lender,	L/C	agent	and	a	lender,	and	the	banks	and	other	financial	institutions	referred	to	therein.

		10.19(21)† Second	Amended	and	Restated	Global	Distribution	Agreement,	dated	as	of	November	15,	2010,	among	BlackRock	and	Merrill	Lynch	&	Co.,	Inc.

		10.20(3) Amended	and	Restated	Implementation	and	Stockholder	Agreement,	dated	as	of	February	27,	2009,	between	The	PNC	Financial	Services	Group,	Inc.	and BlackRock.

		10.21(22) Amendment	No.	1,	dated	as	of	June	11,	2009,	to	the	Amended	and	Restated	Implementation	and	Stockholder	Agreement	between	The	PNC	Financial	Services Group,	Inc.	and	BlackRock.

		10.22(23) Commercial	Paper	Dealer	Agreement	between	BlackRock	and	Barclays	Capital	Inc.,	dated	as	of	October	14,	2009.

		10.23(24) Lease	Agreement,	dated	as	of	February	17,	2010,	among	BlackRock	Investment	Management	(UK)	Limited	and	Mourant	&	Co	Trustees	Limited	and	Mourant Property	Trustees	Limited	as	Trustees	of	the	Drapers	Gardens	Unit	Trust	for	the	lease	of	Drapers	Gardens,	12	Throgmorton	Avenue,	London,	EC2,	United Kingdom.

		10.24(25) Stock	Repurchase	Agreement,	dated	as	of	May	21,	2012,	between	Barclays	Bank	PLC	and	BlackRock.

		10.26(25) Exchange	Agreement,	dated	as	of	May	21,	2012,	among	PNC	Bancorp,	Inc.,	The	PNC	Financial	Services	Group,	Inc.	and	BlackRock.

		12.1 Computation	of	Ratio	of	Earnings	to	Fixed	Charges.

		21.1 Subsidiaries	of	Registrant.

		31.1 Section	302	Certification	of	Chief	Executive	Officer.



Question: what percent of the commitments are due after 2019?
Calculation: commitments_after_2019 = 613
commitments_total = 1178
percent_after_2019 = commitments_after_2019 / commitments_total
answer = percent_after_2019 * 100
Answer: 52.04%