Company: RILY
Filing Date: 2025-12-15
Form Type: 10-Q
Source: 0001464790-25-000029
Chunk: 315

Company: B. Riley Financial, Inc.
Filing Date: 2025-12-15
Form: 10-Q
Item: Part I, Item 8
Chunk 315
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 323, Investments – Equity Method and Joint Ventures, with a three-month lag.Under the equity method of accounting, the Company records its proportionate share of earnings or losses; however, given the capital structure of GA Holdings the Company applies the Hypothetical Liquidation at Book Value (“HLBV”) method on a three-month lag to determine the allocation of profits and losses since the liquidation rights and priorities, as defined by the limited liability agreement of GA Holdings, differ from the Company’s underlying ownership interest. The HLBV method calculates the proceeds that would be attributable to each partner based on the liquidation provisions of the limited liability agreement as if GA Holdings was to be liquidated at book value as of the balance sheet date. Each partner’s allocation of income or loss in the period is equal to the change in the amount of net equity they are legally able to claim based on a hypothetical liquidation of the entity at the end of a reporting period compared to the beginning of that period, adjusted for any capital transactions.As of June 30, 2025 and December 31, 2024, our investment in GA Holdings was $78,823 and $82,462, respectively, and is included in the “Prepaid expenses and other assets” line item in the unaudited condensed consolidated balance sheets. Based on the terms of the limited liability agreement, we recorded equity in net losses attributable to GA Holdings using the HLBV method of $3,190 and $3,639 for the three and six months ended June 30, 2025, respectively, which is included in the “Income from equity investments” line item in the accompanying unaudited condensed consolidated statements of operations.The following tables contain summarized financial information with respect to GA Holdings, included below for purposes of the disclosure a quarter in arrears (balance sheet amounts as of March 31, 2025 correspond to amounts as of June 30, 2025 and income statement amounts during the three months ended March 31, 2025 and period from November 15, 2024 to March 31, 2025 correspond to three months and six months ended June 30, 2025, respectively):March 31, 2025Current assets$46,852 Noncurrent assets$286,144 Current liabilities$41,026 Mezzanine equity - preferred units$279,097 Equity attributable to investee$12,873 Three Months Ended March 31, 2025November 15,