Company: HLI
Filing Date: 2025-08-05
Form Type: 10-Q
Source: 0001302215-25-000092
Chunk: 66

Company: HOULIHAN LOKEY, INC.
Filing Date: 2025-08-05
Form: 10-Q
Item: Part I, Item 8
Chunk 66
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 revenue. Taxes, including value added taxes, collected from customers and remitted to governmental authorities are accounted for on a net basis, and therefore, are excluded from revenue in the Consolidated Statements of Comprehensive Income.Operating ExpensesThe majority of the Company’s operating expenses are related to compensation and benefits for employees, which includes the amortization of the relevant portion of the Company’s share-based incentive plans (Note 14). Other types of operating expenses include: Travel, meals, and entertainment; Rent; Depreciation and amortization; Information technology and communications; Professional fees; Other operating expenses; and Revaluation of acquisition contingent consideration.Translation of Foreign Currency TransactionsThe reporting currency for the consolidated financial statements of the Company is the U.S. Dollar. The assets and liabilities of subsidiaries whose functional currency is other than the U.S. Dollar are included in the consolidation by translating the assets and liabilities at the reporting period-end exchange rates; however, revenues and expenses are translated using the applicable exchange rates determined on a monthly basis throughout the fiscal year. Resulting translation adjustments are reported as a separate component of Accumulated other comprehensive loss, net of applicable taxes.

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Table of ContentsHOULIHAN LOKEY, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)(UNAUDITED)(In thousands, except share data or as otherwise stated)

From time to time, we enter into transactions to hedge our exposure to certain foreign currency fluctuations through the use of derivative instruments or other methods. As of June 30, 2025, we had no open foreign currency forward contracts outstanding. As of June 30, 2024, we had three foreign currency forward contract outstanding between the U.S. Dollar and the Pound Sterling with an aggregate notional value of $67,000. The change in fair value of these contracts represented a net loss included in Other operating expenses of $0 and $(521) during the three months ended June 30, 2025 and 2024, respectively.Fair Value MeasurementsThe Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible. The Company determines fair value based on assumptions that market participants would use in pricing an asset or liability in the principal or most advantageous market. When considering market participant assumptions in fair value measurements, the following fair value hierarchy distinguishes between observable and unobservable inputs, which are categorized in one of the following levels in accordance with Accounting Standards Codification ("ASC") Topic 820