10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended June 30, 2010

OR

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

Commission File Number: 001-33693

DUFF & PHELPS CORPORATION

(Exact name of registrant as specified in its charter)

DELAWARE	20-8893559
(State of other jurisdiction or incorporation or organization)	(I.R.S. employer identification no.)

55 East 52nd Street, 31st Floor

New York, New York  10055

(Address of principal executive offices)

(Zip code)

(212) 871-2000

(Registrant’s telephone number, including area code)

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 þ  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 Regulations 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 ¨  No ¨

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.

Large accelerated filer ¨     Accelerated filer þ     Non-accelerated filer ¨Smaller reporting company ¨

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

The number of shares outstanding of the registrant’s Class A common stock, par value $0.01 per share, was 28,176,493 as of July 15, 2010.  The number of shares outstanding of the registrant’s Class B common stock, par value $0.0001 per share, was 12,908,923 as of July 15, 2010.

DUFF & PHELPS CORPORATION

AND SUBSIDIARIES

TABLE OF CONTENTS

Part I.	Financial Information
	Item 1.	Financial Statements	1
	Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.	26
	Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	54
	Item 4.	Controls and Procedures.	54
Part II.	Other Information
	Item 1.	Legal Proceedings	55
	Item 1A.	Risk Factors	55
	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	55
	Item 3.	Defaults Upon Senior Securities	56
	Item 4.	(Removed and Reserved)	56
	Item 5.	Other Information	56
	Item 6.	Exhibits	56
	Signatures		57

PART I – FINANCIAL INFORMATION

Item 1.  Financial Statements.

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share amounts)

(Unaudited)

	Three Months Ended						Six Months Ended
	June 30,			June 30,			June 30,			June 30,
	2010			2009			2010			2009
Revenues	$	88,742		$	90,053		$	177,906		$	179,318
Reimbursable expenses		1,962			2,626			4,760			4,663
Total revenues		90,704			92,679			182,666			183,981
Direct client service costs
Compensation and benefits (includes $4,215 and $5,075 of equity-based compensation for the three months ended June 30, 2010 and 2009, respectively, and $7,932 and $9,338 for the six months ended June 30, 2010 and 2009, respectively)		50,415			51,698			99,013			102,828
Other direct client service costs		1,881			1,543			3,869			2,847
Reimbursable expenses		2,039			2,637			4,893			4,652
		54,335			55,878			107,775			110,327
Operating expenses
Selling, general and administrative (includes $2,005 and $1,665 of equity-based compensation for the three months ended June 30, 2010 and 2009, respectively, and $3,458 and $3,556 for the six months ended June 30, 2010 and 2009, respectively)		26,304			24,488			50,388			49,428
Depreciation and amortization		2,350			2,556			4,843			5,118
Charge from impairment of certain intangible assets (Note 11)		-			-			674			-
Merger and acquisition costs		321			-			321			-
		28,975			27,044			56,226			54,546
Operating income		7,394			9,757			18,665			19,108
Other expense/(income), net
Interest income		(53	)		(3	)		(77	)		(17	)
Interest expense		76			333			168			988
Loss on early extinguishment of debt		-			1,737			-			1,737
Other expense		247			70			232			87
		270			2,137			323			2,795
Income before income taxes		7,124			7,620			18,342			16,313
Provision for income taxes		2,506			2,421			6,156			4,533
Net income		4,618			5,199			12,186			11,780
Less:  Net income attributable to noncontrolling interest		2,111			3,465			5,406			8,281
Net income attributable to Duff & Phelps Corporation	$	2,507		$	1,734		$	6,780		$	3,499
Weighted average shares of Class A common stock outstanding
Basic		25,058			17,356			25,022			15,428
Diluted		25,754			18,111			25,903			16,045
Net income per share attributable to stockholders of Class A common stock of Duff & Phelps Corporation (Note 5)
Basic	$	0.10		$	0.10		$	0.26		$	0.21
Diluted	$	0.09		$	0.09		$	0.25		$	0.20
Cash dividends declared per common share	$	0.06		$	0.05		$	0.11		$	0.05

See accompanying notes to the condensed consolidated financial statements.

1

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except per share amounts)

(Unaudited)

	June 30,			December 31,
	2010			2009
ASSETS
Current assets
Cash and cash equivalents	$	79,231		$	107,311
Restricted cash (Note 4)		3,156			-
Accounts receivable (net of allowance for doubtful accounts of $1,279 at June 30, 2010 and $1,690 at December 31, 2009)		51,812			55,079
Unbilled services		27,743			22,456
Prepaid expenses and other current assets		8,962			6,100
Net deferred income taxes, current		566			4,601
Total current assets		171,470			195,547
Property and equipment (net of accumulated depreciation of $23,111 at June 30, 2010 and $20,621 at December 31, 2009)		28,387			27,413
Goodwill		129,636			122,876
Intangible assets (net of accumulated amortization of $18,603 at June 30, 2010 and $16,881 at December 31, 2009)		30,818			27,907
Other assets		2,889			3,218
Investments related to deferred compensation plan (Note 10)		20,295			17,807
Net deferred income taxes, non-current		111,221			112,265
Total non-current assets		323,246			311,486
Total assets	$	494,716		$	507,033
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable	$	2,038		$	2,459
Accrued expenses		5,805			11,609
Accrued compensation and benefits		18,345			35,730
Deferred revenues		3,683			3,633
Other current liabilities		170			993
Current portion due to noncontrolling unitholders		4,303			4,303
Total current liabilities		34,344			58,727
Liability related to deferred compensation plan, less current portion (Note 10)		20,237			18,051
Other long-term liabilities		15,715			15,400
Due to noncontrolling unitholders, less current portion		101,382			101,098
Total non-current liabilities		137,334			134,549
Total liabilities		171,678			193,276
Commitments and contingencies (Note 12)
Stockholders' equity
Preferred stock (50,000 shares authorized; zero issued and outstanding)		-			-
Class A common stock, par value $0.01 per share (100,000 shares authorized; 28,208 and 27,290 shares issued and outstanding at June 30, 2010 and December 31, 2009, respectively)		282			273
Class B common stock, par value $0.0001 per share (50,000 shares authorized; 12,909 and 12,974 shares issued and outstanding at June 30, 2010 and December 31, 2009, respectively)		1			1
Additional paid-in capital		213,921			207,210
Accumulated other comprehensive income/(loss)		(1,395	)		693
Retained earnings		10,381			6,709
Total stockholders' equity of Duff & Phelps Corporation		223,190			214,886
Noncontrolling interest		99,848			98,871
Total stockholders' equity		323,038			313,757
Total liabilities and stockholders' equity	$	494,716		$	507,033

See accompanying notes to the condensed consolidated financial statements.

2

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

	Six Months Ended
	June 30,			June 30,
	2010			2009
Cash flows from operating activities:
Net income	$	12,186		$	11,780
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		4,843			5,118
Equity-based compensation		11,390			12,894
Bad debt expense		809			1,362
Net deferred income taxes		5,364			5,784
Charge from impairment of certain intangible assets		674			-
Loss on early extinguishment of debt		-			1,674
Other		127			(357	)
Changes in assets and liabilities providing/(using) cash:
Accounts receivable		5,316			(5,189	)
Unbilled services		(4,823	)		(8,936	)
Prepaid expenses and other current assets		(1,699	)		1,515
Other assets		728			(1,221	)
Accounts payable and accrued expenses		(6,901	)		(2,019	)
Accrued compensation and benefits		(18,704	)		(21,329	)
Deferred revenues		(121	)		1,226
Other liabilities		(27	)		-
Net cash provided by operating activities		9,162			2,302
Cash flows from investing activities:
Purchase of property and equipment		(3,561	)		(3,872	)
Business acquisitions, net of cash acquired		(11,807	)		-
Purchase of investments for deferred compensation plan		(2,975	)		(5,684	)
Net cash used in investing activities		(18,343	)		(9,556	)
Cash flows from financing activities:
Repurchases of Class A common stock		(8,177	)		(740	)
Increase in restricted cash		(3,156	)		(4,043	)
Dividends		(3,141	)		(1,197	)
Distributions and other payments to noncontrolling unitholders		(2,135	)		(12,370	)
Proceeds from exercises of IPO Options		82			343
Other		(3	)		-
Net proceeds from sale of Class A common stock		-			111,871
Redemption of noncontrolling unitholders		-			(67,112	)
Repayments of debt		-			(42,763	)
Fees associated with early extinguishment of debt		-			(63	)
Net cash used in financing activities		(16,530	)		(16,074	)
Effect of exchange rate on cash and cash equivalents		(2,369	)		535
Net decrease in cash and cash equivalents		(28,080	)		(22,793	)
Cash and cash equivalents at beginning of period		107,311			81,381
Cash and cash equivalents at end of period	$	79,231		$	58,588

See accompanying notes to the condensed consolidated financial statements.

3

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY

AND COMPREHENSIVE INCOME/(LOSS)

(In thousands)

(Unaudited)

							Stockholders of Duff & Phelps Corporation
																					Accumulated
	Total																				Other
	Stockholders'			Comprehensive			Common Stock - Class A						Common Stock - Class B					Additional			Comprehensive			Retained			Noncontrolling
	Equity			Income			Shares			Dollars			Shares			Dollars		Paid-in-Capital			Income/(Loss)			Earnings			Interest
Balance as of December 31, 2009	$	313,757						27,290		$	273			12,974		$	1	$	207,210		$	693		$	6,709		$	98,871
Comprehensive income
Net income for the six months ended June 30, 2010		12,186		$	12,186			-			-			-			-		-			-			6,780			5,406
Currency translation adjustment		(3,083	)		(3,083	)		-			-			-			-		-			(2,106	)		-			(977	)
Amortization of post-retirement benefits		27			27			-			-			-			-		-			18			-			9
Total comprehensive income		9,130		$	9,130			-			-			-			-		-			(2,088	)		6,780			4,438
Sale of Class A common stock		(3	)					-			-			-			-		(3	)		-			-			-
Issuance of Class A common stock for acquisitions		1,204						93			1			-			-		827			-			-			376
Exchange of New Class A Units		-						43			-			(43	)		-		-			-			-			-
Net issuance of restricted stock awards		(2,483	)					1,336			14			-			-		(1,713	)		-			-			(784	)
Adjustment to Tax Receivable Agreement as a result of the exchange of New Class A Units		61						-			-			-			-		61			-			-			-
Issuance for exercises of IPO Options		66						4			-			-			-		45			-			-			21
Forfeitures		(2	)					(174	)		(2	)		(22	)		-		-			-			-			-
Equity-based compensation		11,928						-			-			-			-		8,169			-			-			3,759
Income tax benefit on equity-based compensation		72						-			-			-			-		72			-			-			-
Distributions to noncontrolling unitholders		(2,135	)					-			-			-			-		(1,462	)		-			-			(673	)
Change in ownership interests between periods		-						-			-			-			-		4,103			-			-			(4,103	)
Deferred tax asset effective tax rate conversion		(147	)					-			-			-			-		253			-			-			(400	)
Repurchases of Class A common stock pursuant to publicly announced program		(5,302	)					(384	)		(4	)		-			-		(3,641	)		-			-			(1,657	)
Dividends on Class A common stock		(3,108	)					-			-			-			-		-			-			(3,108	)		-
Balance as of June 30, 2010	$	323,038						28,208		$	282			12,909		$	1	$	213,921		$	(1,395	)	$	10,381		$	99,848

See accompanying notes to the condensed consolidated financial statements.

4

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY

AND COMPREHENSIVE INCOME/(LOSS)

(In thousands)

(Unaudited)

						Stockholders of Duff & Phelps Corporation
																				Accumulated			Retained
	Total																			Other			Earnings/
	Stockholders'			Comprehensive		Common Stock - Class A						Common Stock - Class B					Additional			Comprehensive			(Accumulated			Noncontrolling
	Equity			Income		Shares			Dollars			Shares			Dollars		Paid-in-Capital			Income			Deficit)			Interest
Balance as of December 31, 2008	$	237,759					14,719		$	147			20,889		$	2	$	100,985		$	122		$	(1,127	)	$	137,630
Comprehensive income
Net income for the six months ended June 30, 2009		11,780		$	11,780		-			-			-			-		-			-			3,499			8,281
Currency translation adjustment		534			534		-			-			-			-		-			498			-			36
Amortization of post-retirement benefits		16			16		-			-			-			-		-			9			-			7
Total comprehensive income/(loss)		12,330		$	12,330		-			-			-			-		-			507			3,499			8,324
Sale of Class A common stock		111,840					8,050			81			-			-		111,759			-			-			-
Allocation of noncontrolling interest in D&P Acquisitions		-					-			-			-			-		(62,153	)		-			-			62,153
Issuance of Class A common stock		180					10			-			-			-		78			-			-			102
Net issuance of restricted stock awards		(726	)				1,230			13			-			-		(323	)		-			-			(416	)
Redemption of New Class A Units		(67,112	)				-			-			(4,550	)		-		(29,060	)		-			-			(38,052	)
Adjustment to Tax Receivable Agreement as a result of the redemption of New Class A Units		(543	)				-			-			-			-		(543	)		-			-			-
Exercises of IPO Options		312					20			-			-			-		161			-			-			151
Forfeitures		-					(105	)		(2	)		(91	)		-		2			-			-			-
Equity-based compensation		13,821					-			-			-			-		6,782			-			-			7,039
Income tax benefit on equity-based compensation		(71	)				-			-			-			-		(71	)		-			-			-
Distributions to noncontrolling unitholders		(12,370	)				-			-			-			-		(5,915	)		-			-			(6,455	)
Change in ownership interests between periods		-					-			-			-			-		51,648			(125	)		-			(51,523	)
Adjustment to due to noncontrolling unitholders		(3,579	)				-			-			-			-		(3,579	)		-			-			-
Deferred tax asset effective tax rate conversion		2,243					-			-			-			-		2,243			-			-			-
Dividends on Class A common stock		(1,189	)				-			-			-			-		-			-			(1,189	)		-
Balance as of June 30, 2009	$	292,895					23,924		$	239			16,248		$	2	$	172,014		$	504		$	1,183		$	118,953

See accompanying notes to the condensed consolidated financial statements.

5

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

Note 1   -  DESCRIPTION OF BUSINESS

Duff & Phelps Corporation (the “Company”) is a leading provider of independent financial advisory and investment banking services.  Its mission is to help its clients protect, maximize and recover value by providing independent advice on issues involving highly technical and complex assessments in the areas of valuation, transactions, financial restructuring, disputes and taxation.  The Company believes that the Duff & Phelps brand is associated with experienced professionals who give trusted guidance in a responsive manner.  The Company serves a global client base through offices in 24 cities, comprised of offices in 17 U.S. cities, including New York, Chicago, Dallas and Los Angeles, and seven international offices located in Amsterdam, London, Munich, Paris, Shanghai, Tokyo and Toronto.

Note 2   -  BASIS OF PRESENTATION

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and with the rules and regulations of the United States Securities and Exchange Commission (“SEC”) for interim financial reporting, and include all adjustments which are, in the opinion of management, necessary for a fair presentation.  The financial statements require the use of management estimates and include the accounts of the Company, its controlled subsidiaries and other entities consolidated as required by accounting principles generally accepted in the United States of America (“GAAP”).  References to the “Company,” “its” and “itself,” refer to Duff & Phelps Corporation and its subsidiaries, unless the context requires otherwise.

The balance sheet at December 31, 2009 was derived from audited financial statements, but does not include all disclosures required by (“GAAP”).  Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations.  In management’s opinion, all adjustments necessary for a fair presentation are reflected in the interim periods presented.  All significant intercompany accounts and transactions have been eliminated in consolidation.

Recently Issued Accounting Pronouncements

In October 2009, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2009-13, Multiple-Deliverable Revenue Arrangements.  ASU 2009-13 supersedes certain guidance in FASB Accounting Standards Codification (“ASC”) 605-25, Revenue Recognition–Multiple-Element Arrangements and requires an entity to allocate arrangement consideration at the inception of an arrangement to all of its deliverables based on their relative selling prices (the relative-selling-price method).  ASU 2009-13 eliminates the use of the residual method of allocation in which the undelivered element is measured at its estimated selling price and the delivered element is measured as the residual of the arrangement consideration, and requires the relative-selling-price method in all circumstances in which an entity recognizes revenue for an arrangement with multiple deliverable subject to ASU 2009-13.  ASU 2009-13 must be adopted no later than the beginning of the first fiscal year beginning on or after June 15, 2010, with early adoption permitted through either prospective application for revenue arrangements entered into, or materially modified, after the effective date or through retrospective application to all revenue arrangements for all periods presented.  The Company is currently evaluating the impact that the adoption of ASU 2009-13 will have on its consolidated financial statements.

Critical Accounting Policies

Except for the implementation of a stock repurchase program, there have been no significant changes in new accounting pronouncements or in our critical accounting policies and estimates from those that were disclosed in our Annual Report on Form 10-K for the year ended December 31, 2009.  In conjunction with the stock repurchase program, repurchased shares are retired and recorded as a reduction to additional paid-in capital.

6

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

The Company believes that the disclosures herein are adequate so that the information presented is not misleading; however, it is suggested that these financial statements be read in conjunction with the financial statements and the notes thereto in our Annual Report on Form 10-K for the year ended December 31, 2009.  The financial data for the interim periods may not necessarily be indicative of results to be expected for the year.

Note 3   -   NONCONTROLLING INTEREST

The Company has sole voting power in and controls the management of D&P Acquisitions, LLC and its subsidiaries (“D&P Acquisitions”), which collectively represent the operating subsidiaries of the Company.  As a result, the Company consolidates the financial results of D&P Acquisitions and records noncontrolling interest for the economic interest in D&P Acquisitions held by the existing unitholders to the extent the book value of their interest in D&P Acquisitions is greater than zero.  The Company’s economic interest in D&P Acquisitions totaled 68.6% at June 30, 2010.  The noncontrolling unitholders’ interest in D&P Acquisitions totaled 31.4% at June 30, 2010.

Net income attributable to the noncontrolling interest on the statement of operations represents the portion of earnings or loss attributable to the economic interest in D&P Acquisitions held by the noncontrolling unitholders.  Noncontrolling interest on the balance sheet represents the portion of net assets of D&P Acquisitions attributable to the noncontrolling unitholders based on the portion of total units of D&P Acquisitions owned by such unitholders (“New Class A Units”).  The ownership of the New Class A Units is summarized as follows:

	Duff &			Non-
	Phelps			controlling
	Corporation			Unitholders			Total
December 31, 2009		27,290			12,974			40,264
Issuance of Class A common stock for acquisitions		93			-			93
Exchange to Class A common stock		43			(43	)		-
Net issuance of restricted stock awards		1,336			-			1,336
Issuance for exercises of IPO Options		4			-			4
Repurchases of Class A common stock pursuant to publicly announced program		(384	)		-			(384	)
Forfeitures		(174	)		(22	)		(196	)
June 30, 2010		28,208			12,909			41,117
Percent of total
December 31, 2009		67.8	%		32.2	%		100	%
June 30, 2010		68.6	%		31.4	%		100	%

7

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

A reconciliation from “Income before income taxes” to “Net income attributable to the noncontrolling interest” and “Net income attributable to Duff & Phelps Corporation” is detailed as follows:

	Three Months Ended						Six Months Ended
	June 30,			June 30,			June 30,			June 30,
	2010			2009			2010			2009
Income before income taxes	$	7,124		$	7,620		$	18,342		$	16,313
Less:  provision for income taxes for entities other than Duff & Phelps Corporation(a)(b)		(410	)		(292	)		(1,330	)		(672	)
Income before income taxes, as adjusted		6,714			7,328			17,012			15,641
Ownership percentage of noncontrolling interest(d)		31.4	%		47.3	%		31.8	%		52.9	%
Net income attributable to noncontrolling interest		2,111			3,465			5,406			8,281
Income before income taxes, as adjusted, attributable to Duff & Phelps Corporation		4,603			3,863			11,606			7,360
Less:  provision for income taxes of Duff & Phelps
Corporation(a)(c)		(2,096	)		(2,129	)		(4,826	)		(3,861	)
Net income attributable to Duff & Phelps Corporation	$	2,507		$	1,734		$	6,780		$	3,499

_________________________________

(a)

The consolidated provision for income taxes is equal to the sum of (i) the provision for income taxes for entities other than Duff & Phelps Corporation and (ii) the provision for income taxes of Duff & Phelps Corporation.  The consolidated provision for income taxes totaled $2,506 and $2,421 for the three months ended June 30, 2010 and 2009, respectively, and $6,156 and $4,533 for the six months ended June 30, 2010 and 2009, respectively.

(b)

The provision for income taxes for entities other than Duff & Phelps Corporation represents taxes imposed directly on Duff & Phelps, LLC, a wholly-owned subsidiary of D&P Acquisitions, and its subsidiaries, such as taxes imposed on certain domestic subsidiaries (e.g., Rash & Associates, L.P.), taxes imposed by certain foreign jurisdictions, and taxes imposed by certain local and other jurisdictions (e.g., New York City).  Since Duff & Phelps, LLC is taxed as a partnership and a flow-through entity for U.S. federal and state income tax purposes, there is no provision for these taxes on income allocable to the noncontrolling interest.

(c) The provision of income taxes of Duff & Phelps Corporation includes all U.S. federal and state income taxes.

(d) Income before income taxes, as adjusted, is allocated to the noncontrolling interest based on the total New Class A Units vested for income tax purposes (“Tax-Vested Units”) owned by the noncontrolling interest as a percentage of the aggregate amount of all Tax-Vested Units.  This percentage may not necessarily correspond to the total number of New Class A Units at the end of each respective period.

Distributions and Other Payments to Noncontrolling Unitholders

The following table summarizes distributions and other payments to noncontrolling unitholders, as described more fully below:

8

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

	Six Months Ended
	June 30,		June 30,
	2010		2009
Distributions for taxes	$	708	$	11,714
Other distributions		1,427		656
Payments pursuant to the Tax Receivable Agreement		-		-
	$	2,135	$	12,370

Distributions for taxes

As a limited liability company, D&P Acquisitions does not incur significant federal or state and local taxes, as these taxes are primarily the obligations of the members of D&P Acquisitions.  As authorized by the Third Amended and Restated LLC Agreement of D&P Acquisitions, D&P Acquisitions is required to distribute cash, generally, on a pro rata basis, to its members to the extent necessary to provide funds to pay the members' tax liabilities, if any, with respect to the earnings of D&P Acquisitions.  The tax distribution rate has been set at 45% of each member’s allocable share of taxable income of D&P Acquisitions.  D&P Acquisitions is only required to make such distributions if cash is available for such purposes as determined by the Company.  The Company expects cash will be available to make these distributions.  Upon completion of its tax returns with respect to the prior year, D&P Acquisitions may make true-up distributions to its members, if cash is available for such purposes, with respect to actual taxable income for the prior year.  The decrease in tax distributions between periods primarily resulted from the timing of quarterly payments.  The decrease in payments for the distributions for taxes between the six months ended June 30, 2010 and 2009 primarily resulted from the timing of payments.  The distributions for each member’s estimated tax liability from taxable income of D&P acquisitions during the fourth quarter of 2008 was primarily made during the first quarter of 2009.  The corresponding distribution to members for taxable income of D&P acquisitions during the fourth quarter of 2009 was primarily made during the quarter ended December 31, 2009.

Other distributions

During the six months ended June 30, 2010, the Company distributed $1,427 to holders of New Class A Units, other than Duff & Phelps Corporation.  Concurrent with the payment of the dividend to shareholders of record, holders of New Class A Units received a $0.05 and $0.06 distribution per vested unit on March 16, 2010 and May 28, 2010, respectively.  These amounts totaled $1,265 and will be treated as a reduction in basis of each member’s ownership interests.  Pursuant to the terms of the Third Amended and Restated LLC Agreement of D&P Acquisitions, a corresponding amount per unvested unit was deposited into a segregated account and will be distributed once a year with respect to units that vested during that year.  During the six months ended June 30, 2010, the Company distributed $162 to members whose units vested during 2009.  Any amounts related to unvested units that forfeit are returned to the Company.

Payments pursuant to the Tax Receivable Agreement

As a result of the Company’s acquisition of New Class A Units of D&P Acquisitions, the Company expects to benefit from depreciation and other tax deductions reflecting D&P Acquisitions' tax basis for its assets.  Those deductions will be allocated to the Company and will be taken into account in reporting the Company’s taxable income.  Further, as a result of a federal income tax election made by D&P Acquisitions applicable to a portion of the Company’s acquisition of New Class A Units of D&P Acquisitions, the income tax basis of the assets of D&P Acquisitions underlying a portion of the units the Company has and will acquire (pursuant to the exchange agreement) will be adjusted based upon the amount that the Company has paid for that portion of its New Class A Units of D&P Acquisitions.

The Company has entered into a tax receivable agreement (“TRA”) with the existing unitholders of D&P Acquisitions (for the benefit of the existing unitholders of D&P Acquisitions) that provides for the payment by the Company to the unitholders of D&P Acquisitions of 85% of the amount of cash savings, if any, in U.S. federal, state and local income tax that the Company realizes (i) from the tax basis in its proportionate share of D&P Acquisitions' goodwill and similar intangible assets that the Company receives as a result of the exchanges and (ii) from the federal income tax election referred to above.  D&P Acquisitions expects to make future payments under the TRA to the extent cash is available for such purposes.

9

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

As of June 30, 2010, the Company recorded a liability of $105,685, representing the payments due to D&P Acquisitions’ unitholders under the TRA (see current and non-current portion of “Due to noncontrolling unitholders” on the Company’s Condensed Consolidated Balance Sheets).   

10

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

Within the next 12 month period, the Company expects to pay $4,303 of the total amount.  The basis for determining the current portion of the payments due to D&P Acquisitions’ unitholders under the TRA is the expected amount of payments to be made within the next 12 months.  The long-term portion of the payments due to D&P Acquisitions’ unitholders under the tax receivable agreement is the remainder.  Payments are anticipated to be made annually over 15 years, commencing from the date of each event that gives rise to the TRA benefits, beginning with the date of the closing of the IPO on October 3, 2007.  The payments are made in accordance with the terms of the TRA.  The timing of the payments is subject to certain contingencies including Duff & Phelps Corporation having sufficient taxable income to utilize all of the tax benefits defined in the TRA.

To determine the current amount of the payments due to D&P Acquisitions’ unitholders under the TRA, the Company estimated the amount of taxable income that Duff & Phelps Corporation has generated over the previous fiscal year.  Next, the Company estimated the amount of the specified TRA deductions at year end.  This was used as a basis for determining the amount of tax reduction that generates a TRA obligation.  In turn, this was used to calculate the estimated payments due under the TRA that the Company expects to pay in the next 12 months.  These calculations are performed pursuant to the terms of the TRA.

Obligations pursuant to the TRA are obligations of Duff & Phelps Corporation.  They do not impact the noncontrolling interest.  These obligations are not income tax obligations and have no impact on the tax provision or the allocation of taxes.  Furthermore, the TRA has no impact on the allocation of the provision for income taxes to the Company’s net income.  In general, items of income and expense are allocated on the basis of member’s ownership interests pursuant to the Third Amended and Restated Limited Liability Company Agreement of Duff & Phelps Acquisitions, LLC.

Note  4  -  ACQUISITIONS

On June 15, 2010, a subsidiary of the Company acquired Cole Valuation Partners Limited (“Cole”), a Canadian-based independent financial advisory firm.  Headquartered in Toronto, Cole specializes in financial litigation support, business valuation, corporate finance advisory, and forensic and investigative accounting.  Cole has five managing directors and 31 total employees located in its Toronto office.  The purchase price was not material to the Company’s consolidated financial statements.  Cole operates as part of the Financial Advisory segment.  Pursuant to the terms of the acquisition agreement, the Company placed $3,156 of cash into an escrow account which is included as “Restricted cash” on our Condensed Consolidated Balance Sheets.  The Company recognized $547 of revenue from Cole during the three and six months ended June 30, 2010.

Note  5  -  EARNINGS PER SHARE

Basic earnings per share (“EPS”) measures the performance of an entity over the reporting period.  Diluted earnings per share measures the performance of an entity over the reporting period while giving effect to all potentially dilutive common shares that were outstanding during the period.  The treasury stock method is used to determine the dilutive potential of stock options, restricted stock awards, restricted stock units, and D&P Acquisitions’ units and Class B common stock that are exchangeable into D&P Class A common stock.

In accordance with FASB ASC 260, Earnings Per Share, all outstanding unvested share-based payments that contain rights to non-forfeitable dividends participate in the undistributed earnings with the common stockholders and are therefore participating securities.  Companies with participating securities are required to apply the two-class method in calculating basic and diluted net income per share.

11

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

Our restricted stock awards are considered participating securities as they receive non-forfeitable dividends at the same rate as our common stock.  The computation of basic and diluted net income per share is reduced for a presumed hypothetical distribution of earnings to the holders of our unvested restricted stock.  Accordingly, the effect of the allocation reduces earnings available for common stockholders.

The following is a reconciliation of the numerator and denominator used in the basic and diluted EPS calculations:

	Three Months Ended						Six Months Ended
	June 30,			June 30,			June 30,			June 30,
	2010			2009			2010			2009
Basic and diluted net income per share:
Numerator
Net income available to holders of Class A common stock	$	2,507		$	1,734		$	6,780		$	3,499
Earnings allocated to participating securities		(97	)		(65	)		(393	)		(266	)
Earnings available for common stockholders	$	2,410		$	1,669		$	6,387		$	3,233
Denominator for basic net income per share of Class A common stock
Weighted average shares of Class A common stock		25,058			17,356			25,022			15,428
Denominator for diluted net income per share of Class A common stock
Weighted average shares of Class A common stock		25,058			17,356			25,022			15,428
Add dilutive effect of the following:
Restricted stock awards and units		696			755			881			617
Assumed conversion of New Class A Units for Class A common stock(a)		-			-			-			-
Dilutive weighted average shares of Class A common stock		25,754			18,111			25,903			16,045
Basic income per share of Class A common stock	$	0.10		$	0.10		$	0.26		$	0.21
Diluted income per share of Class A common stock	$	0.09		$	0.09		$	0.25		$	0.20
______________________________
(a) The following shares were anti-dilutive and excluded from this calculation:
Weighted average New Class A Units outstanding		12,927			18,669			12,947			19,773
Weighted average IPO Options outstanding		1,771			1,926			1,791			1,959

Anti-dilution is the result of (i) the allocation of income or loss associated with the exchange of New Class A Units for Class A common stock and (ii) options listed above exceeding those outstanding under the treasury stock method.

Shares of Class B common stock do not share in the earnings of the Company and are therefore not participating securities.  Accordingly, basic and diluted earnings per share of Class B common stock have not been presented.

12

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

Note 6  -   EQUITY-BASED COMPENSATION

For a detailed description of past equity-based compensation activity, please refer to the Company’s Annual Report on Form 10-K for the year ended December 31, 2009.  There have been no significant changes in the Company’s equity-based compensation accounting policies and assumptions from those that were disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2009.

Equity-based compensation with respect to (a) grants of units of D&P Acquisitions prior to the recapitalization transaction that were effectuated in conjunction with the IPO (“Legacy Units”), (b) options to purchase shares of the Company’s Class A common stock granted in connection with the IPO (“IPO Options”) and (c) restricted stock awards and units issued in connection with the Company’s ongoing long-term compensation program (“Ongoing RSAs”) is detailed in the table below:

	Three Months Ended						Three Months Ended
	June 30, 2010						June 30, 2009
	Client						Client
	Service		SG&A		Total		Service		SG&A		Total
Legacy Units	$	298	$	587	$	885	$	2,828	$	649	$	3,477
IPO Options		338		271		609		720		284		1,004
Ongoing RSAs		3,579		1,147		4,726		1,527		732		2,259
Total	$	4,215	$	2,005	$	6,220	$	5,075	$	1,665	$	6,740
	Six Months Ended						Six Months Ended
	June 30, 2010						June 30, 2009
	Client						Client
	Service		SG&A		Total		Service		SG&A		Total
Legacy Units	$	563	$	919	$	1,482	$	4,527	$	1,288	$	5,815
IPO Options		671		424		1,095		1,353		565		1,918
Ongoing RSAs		6,698		2,115		8,813		3,458		1,703		5,161
Total	$	7,932	$	3,458	$	11,390	$	9,338	$	3,556	$	12,894

Restricted stock awards and restricted stock units are granted as a form of incentive compensation and are accounted for similarly.  Corresponding expense is recognized based on the fair market value of the Company’s Class A common stock on the date of grant over the service period.  Restricted stock units are generally contingent on continued employment and are converted to common stock when restrictions on transfer lapse after three years.

During the six months ended June 30, 2010, the Company issued 1,643 Ongoing RSAs related to annual bonus incentive compensation, performance incentive initiatives, promotions and recruiting efforts.  The restrictions on transfer and forfeiture provisions are generally eliminated after three years for all awards granted to non-executives with certain exceptions related to retiree eligible employees and termination of employees without cause.

Of the 1,643 Ongoing RSAs granted, 120 awards were granted to executives on March 10, 2010.  The restrictions on transfer and forfeiture provisions are eliminated annually over three years based on ratable vesting for grants made to executives.  In addition, 23 awards were granted to members of the board of directors on May 6, 2010.  The restrictions on transfer and forfeiture provisions are eliminated annually over four years based on ratable vesting for grants made to members of the board of directors.

13

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

Below is a summary of restricted stock award activity during the six months ended June 30, 2010:

				Weighted					Weighted
	Restricted			Average		Restricted			Average
	Stock			Grant Date		Stock			Grant Date
	Awards			Fair Value		Units			Fair Value
Balance as of December 31, 2009		2,340		$	14.11		173		$	13.43
Granted		1,489			16.94		154			16.92
Converted to Class A common stock upon lapse of restrictions		(358	)		16.18		-			13.84
Forfeited		(174	)		14.97		(1	)		14.84
Balance as of June 30, 2010		3,297		$	15.16		326		$	15.07
Vested		-					-
Unvested		3,297					326

Below is a summary of option activity during the six months ended June 30, 2010:

				Weighted
				Average
	IPO			Grant Date
	Options			Fair Value
Balance as of December 31, 2009		1,815		$	7.33
Granted		-			-
Exercised		(4	)		7.33
Forfeited		(78	)		7.33
Balance as of June 30, 2010		1,733		$	7.33
Vested		919
Unvested		814
Weighted average exercise price	$	16.00
Weighted average remaining contractual term		7.25
Total intrinsic value of exercised options	$	3
Total fair value of options vested	$	6,739
Aggregate intrinsic value	$	-
Options expected to vest		1,631
Aggregate intrinsic value of options expected to vest	$	-

Forfeitures for Legacy Units, IPO Options and Ongoing RSAs are estimated at the time an award is granted and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates.  Pre-vesting forfeitures were estimated to be between 2% and 21% as of June 30, 2010 based on historical experience and future expectations.

14

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

The following table summarizes activity for New Class A Units attributable to equity-based compensation during the six months ended June 30, 2010:

	New
	Class A Units
	Attributable to
	Equity-Based
	Compensation
Balance as of December 31, 2009		3,231
Forfeited		(22	)
Exchanged		(43	)
Balance as of June 30, 2010		3,166
Vested		2,077
Unvested		1,089

The total unamortized compensation cost related to all non-vested awards was $30,045 at June 30, 2010.  A tax benefit of $1,074 and $1,385 was recognized for the stock options issued in conjunction with the IPO and Ongoing RSAs for the six months ended June 30, 2010 and 2009, respectively.

15

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

Note  7  -   FAIR VALUE MEASUREMENTS

The following table presents assets and liabilities measured at fair value on a recurring basis as of June 30, 2010:

	Quoted Prices
	in Active		Significant
	Markets for		Other		Significant
	Identical		Observable		Unobservable
	Assets		Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Investments held in conjunction with deferred compensation plan(1)	$	-	$	20,295	$	-	$	20,295
Total assets	$	-	$	20,295	$	-	$	20,295
Benefits payable in conjunction with deferred compensation plan(1)	$	-	$	20,237	$	-	$	20,237
Interest rate swap(2)		-		94		-		94
Total liabilities	$	-	$	20,331	$	-	$	20,331

____________________________

(1) The investments held and benefits payable to participants in conjunction with the deferred compensation plan were primarily based on quoted prices for similar assets in active markets.  Changes in the fair value of the investments are recognized as an increase or decrease in compensation expense.  Changes in the fair value of the benefits payables to participants are recognized as a corresponding offset to compensation expense.  The net impact of changes in fair value is not material.  The deferred compensation plan is further discussed in Note 10.

(2) The fair value of the interest rate swap was based on quoted prices for similar assets or liabilities in active markets.  The Company’s interest rate swap is further discussed in Note 8.

The Company does not have any material financial assets in a market that is not active.

16

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

Note  8  -   LONG-TERM DEBT

On July 15, 2009, Duff & Phelps, LLC entered into a credit agreement with Bank of America, N.A., as administrative agent and the lenders from time to time party thereto ("Credit Agreement"), providing for a $30,000 senior secured revolving credit facility (“Credit Facility”), including a $10,000 sub-limit for the issuance of letters of credit.  The proceeds of the facility are permitted to be used for working capital, permitted acquisitions and general corporate purposes.  The maturity date is July 15, 2012 and amounts borrowed may be voluntarily prepaid at any time without penalty or premium, subject to customary breakage costs.

There were no amounts outstanding under the Credit Facility at June 30, 2010 or through the filing date of this Quarterly Report on Form 10-Q.  As of June 30, 2010, the Company had $4,472 of outstanding letters of credit of which $4,085 were issued against the Credit Facility.  There was $387 of cash deposited into a restricted account to serve as deposits to secure the remaining letters of credit.  These letters of credit were issued in connection with real estate leases.

Loans under the Credit Facility will, at the Company's option, bear interest on the principal amount outstanding at either (a) a rate equal to LIBOR, plus an applicable margin or (b) a base rate, plus an applicable margin.  The applicable margin rate will be based on the Company's most recent consolidated leverage ratio and ranges from 1.75% to 2.50% per annum depending on the Company's consolidated leverage ratio.  In addition, the Company is required to pay an unused commitment fee on the actual daily amount of the unutilized portion of the commitments of the lenders at a rate ranging from 0.25% to 0.50% per annum, based on the Company's most recent consolidated leverage ratio.  Based on the Company’s consolidated leverage ratio at June 30, 2010, the Company qualified for the 1.75% applicable margin and 0.25% unused commitment fee.

The Credit Agreement contains customary representations and warranties and customary affirmative and negative covenants, including, among others, limitations on (a) the incurrence of liens, (b) the incurrence of indebtedness, (c) the ability to make dividends and distributions, as well as redeem and repurchase equity interests, and (d) acquisitions, mergers, consolidations and sales of assets.  In addition, the Credit Agreement contains financial covenants that do not permit (a) a total leverage ratio of greater than 2.75 to 1.00 until the quarter ending September 30, 2010, and 2.50 to 1.00 thereafter and (b) a consolidated fixed charge coverage ratio of less than 2.00 to 1.00.  The financial covenants are tested on the last day of each fiscal quarter based on the last four fiscal quarter periods.  Management believes that the Company was in compliance with all of its covenants as of June 30, 2010.  The Credit Agreement permits dividend payments or other distributions in the Company’s common stock or other equity interests subject to certain limitations.

The obligation of the Company to pay amounts outstanding under the Credit Facility may be accelerated upon the occurrence of an "Event of Default" as defined in the Credit Agreement.  The Company's obligations under the Credit Agreement are guaranteed by D&P Acquisitions, and certain domestic subsidiaries of the Company (collectively, the "Guarantors").  The Credit Agreement is secured by a lien on substantially all of the personal property of the Company and each of the Guarantors.

Interest Rate Swap

The Company has an $8,400 notional amount interest rate swap that effectively converted floating rate LIBOR payments to fixed payments at 4.94%.  As a result of the termination of the Company’s former credit facility with General Electric Capital Corporation, the underlying floating rate obligation is no longer outstanding.  The swap agreement terminates September 30, 2010.  The Company elected not to apply hedge accounting to this instrument.  The estimated fair value of the interest rate swap is based on quoted market prices.  The gain or loss is recorded in “Other expense” and has a non-cash impact on the Company’s operations.  At June 30, 2010, the liability resulting from the interest rate swap was included in “Other current liabilities.”

17

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

The following table summarizes the estimated fair value and the gain or loss recorded for the change in fair value of the interest rate swap.

	Three Months Ended						Six Months Ended
	June 30,			June 30,			June 30,			June 30,
	2010			2009			2010			2009
Gain resulting from change in fair value of interest rate swap	$	103		$	135		$	227		$	326
Estimated fair value – (liability)	$	(94	)	$	(604	)	$	(94	)	$	(604	)

18

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

Note  9  -  INCOME TAXES

The Company’s effective tax rate is summarized in the following table:

	Three Months Ended						Six Months Ended
	June 30,			June 30,			June 30,			June 30,
	2010			2009			2010			2009
Provision for income taxes	$	2,506		$	2,421		$	6,156		$	4,533
Effective income tax rate		35.2	%		31.8	%		33.6	%		27.8	%

The tax provision for the current year period is based on our estimate of the Company’s annualized income tax rate.  The effective tax rate is calculated by dividing the provision for income taxes by income before income taxes.

The Company's effective tax rate includes a rate benefit attributable to the fact that the Company’s subsidiaries operate as a series of limited liability companies and other flow-through entities which are not subject to federal income tax.  Accordingly, a portion of the Company's earnings are not subject to corporate level taxes.  This favorable impact is partially offset by the impact of certain permanent items, primarily attributable to certain compensation related expenses that are not deductible for tax purposes.

The Company accounts for uncertainties in income tax positions in accordance with FASB ASC 740, Income Taxes.   A reconciliation of the beginning and ending amount of unrecognized tax benefit is summarized as follows:

Balance as of December 31, 2009	$	548
Additional based on tax positions related to the current year		61
Balance as of June 30, 2010	$	609

The Company recognizes interest income and expense related to income taxes as a component of interest expense and penalties as a component of selling, general and administrative expenses.

The Company and its subsidiaries file income tax returns in the U.S. federal jurisdiction and various states and foreign jurisdictions.  Duff & Phelps, LLC and D&P Acquisitions are open for federal income tax purposes from 2006 forward.  These entities are not subject to federal income taxes as they are flow-through entities.  The Company is open for federal income tax purposes beginning in 2007.

With respect to state and local jurisdictions and countries outside of the United States, the Company and its subsidiaries are typically subject to examination for four to five years after the income tax returns have been filed.  Although the outcome of tax audits is always uncertain, the Company believes that adequate amounts of tax, interest and penalties have been provided for in the accompanying consolidated financial statements for any adjustments that might be incurred due to state, local or foreign audits.

19

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

Note 10  - DEFERRED COMPENSATION PLAN

The Company maintains the Duff & Phelps Deferred Compensation Plan (“Deferred Compensation Plan”) for key employees.  This plan is detailed further in our Annual Report on Form 10-K for the year ended December 31, 2009.

Under the terms of the plan, the Company established a “rabbi trust” as a vehicle for accumulating assets to pay benefits under the plan.  Payments under the plan may be paid from the general assets of the Company or from the assets of any such rabbi trust.  Payment from any such source reduces the obligation owed to the participant or beneficiary.  The rabbi trust invests in an investment vehicle structured as a corporate-owned life insurance (“COLI”) policy with a cash surrender value that mirrors the payable to the participants of the plan and tracks the value of the plan assets.  Participants can earn a return on their deferred compensation that is based on hypothetical investment funds.  The policy is redeemable on demand in an amount equal to the cash surrender value.  The cash surrender value approximates fair value.

The following table summarizes the fair market value of the rabbi trust and the corresponding liability owed to participants:

	June 30,		December 31,
	2010		2009
Fair market value of investments in rabbi trust	$	20,295	$	17,807
Payable to participants of the plan		20,237		18,051

(1) The fair market value of investments in rabbi trust held in conjunction with the deferred compensation plan excludes approximately $0 and $251 which is included in cash and cash equivalents at June 30, 2010 and December 31, 2009, respectively.

The fair market value of the investments in the rabbi trust is included in “Investments related to the deferred compensation plan” with the corresponding deferred compensation obligation included in “Current portion of liability related to deferred compensation plan” and “Liability related to deferred compensation plan, less current portion” on the Condensed Consolidated Balance Sheets.  Changes in the fair value of the investments are recognized as compensation expense (or credit).  Changes in the fair value of the benefits payables to participants are recognized as a corresponding offset to compensation expense (or credit).  The net impact of changes in fair value is not material.

Note 11  -  IMPAIRMENT OF CERTAIN INTANGIBLE ASSETS

The impairment of certain intangible assets resulted from a onetime charge incurred to impair certain intangible assets that originated from our acquisition of World Tax Services US, LLC (“WTS”) in July 2008.  WTS operated as part of the Financial Advisory segment.  The impairment resulted from the departure of the two managing directors who ran the practice and associated staff in March 2010.

Note 12  -  COMMITMENTS AND CONTINGENCIES

The Company is involved in various claims or disputes arising in the normal course of business.  Management does not believe that these matters would have a material adverse effect on the Company's financial position, results of operations or liquidity.

20

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

Note 13  - CHARGE FROM REALIGNMENT OF SENIOR MANAGEMENT

On April 22, 2010, the Company announced the departure of its former president and one of its segment leaders.  The Company incurred a onetime charge associated with these changes of approximately $3,550 in the three months ended June 30, 2010 related to cash severance and the accounting impact of accelerated vesting of equity-based awards.  Approximately $540 of this amount is included in direct client service costs as a component of compensation and benefits and approximately $3,010 in operating expenses as a component of selling, general and administrative expenses.  These charges were not allocated to any of the Company’s segments or associated with a restructuring, exit or disposal activity.

21

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

Note 14  - SEGMENT INFORMATION

The Company provides services through three segments:  Financial Advisory, Corporate Finance Consulting and Investment Banking.  The Financial Advisory segment provides services associated with valuation advisory, tax, and dispute and legal management consulting.  The Corporate Finance Consulting segment provides services related to portfolio valuation, financial engineering, strategic value advisory and due diligence.  The Investment Banking segment provides restructuring advisory services, transaction opinions, and merger and acquisition advisory services.

	Three Months Ended						Six Months Ended
	June 30,			June 30,			June 30,			June 30,
	2010			2009			2010			2009
Financial Advisory
Revenues (excluding reimbursables)	$	54,234		$	57,906		$	108,116		$	118,797
Segment operating income	$	8,449		$	10,339		$	15,987		$	20,688
Segment operating income margin		15.6	%		17.9	%		14.8	%		17.4	%
Corporate Finance Consulting
Revenues (excluding reimbursables)	$	13,319		$	14,978		$	28,255		$	29,594
Segment operating income	$	1,177		$	3,178		$	4,159		$	6,430
Segment operating income margin		8.8	%		21.2	%		14.7	%		21.7	%
Investment Banking
Revenues (excluding reimbursables)	$	21,189		$	17,169		$	41,535		$	30,927
Segment operating income	$	5,050		$	3,288		$	10,107		$	4,831
Segment operating income margin		23.8	%		19.2	%		24.3	%		15.6	%
Total
Revenues (excluding reimbursables)	$	88,742		$	90,053		$	177,906		$	179,318
Segment operating income	$	14,676		$	16,805		$	30,253		$	31,949
Net client reimbursable expenses		(77	)		(11	)		(133	)		11
Equity-based compensation from Legacy Units and IPO Options		(1,494	)		(4,481	)		(2,577	)		(7,734	)
Depreciation and amortization		(2,350	)		(2,556	)		(4,843	)		(5,118	)
Charge from impairment of certain intangible assets		-			-			(674	)		-
Charge from realignment of senior management (not included in equity-based compensation from Legacy
Units and IPO Options above)(Note 13)		(3,040	)		-			(3,040	)		-
Merger and acquisition costs		(321	)		-			(321	)		-
Operating income	$	7,394		$	9,757		$	18,665		$	19,108

Revenues excluding reimbursable expenses attributable to geographic area are summarized as follows:

	Three Months Ended				Six Months Ended
	June 30,		June 30,		June 30,		June 30,
	2010		2009		2010		2009
North America	$	78,846	$	81,596	$	155,917	$	162,904
Europe		8,875		6,949		20,082		13,831
Asia		1,021		1,508		1,907		2,583
Revenues (excluding reimbursables)	$	88,742	$	90,053	$	177,906	$	179,318

There were no intersegment revenues during the periods presented.  The Company does not maintain separate balance sheet information by segment.

22

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

For segment reporting purposes, management uses certain estimates and assumptions to allocate revenues and expenses.  Revenues and expenses attributable to reportable segments are generally based on which segment and product line a client service professional is a dedicated member.  As a result, revenues recognized that relate to the cross utilization of client service professionals across reportable segments occur each period depending on the expertise required for each engagement.  In the three months ended June 30, 2010 and 2009, the Financial Advisory segment (primarily Valuation Advisory services) recognized revenues of $1,247 and $2,245 from the cross utilization of its client service professionals on engagements from the Corporate Finance Consulting segment (primarily Portfolio Valuation services), respectively.  In the six months ended June 30, 2010 and 2009, the Financial Advisory segment (primarily Valuation Advisory services) recognized revenues of $4,192 and $6,567 from the cross utilization of its client service professionals on engagements from the Corporate Finance Consulting segment (primarily Portfolio Valuation services), respectively.

23

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

Note 15  - RELATED PARTY TRANSACTIONS

Lovell Minnick Partners

Entities affiliated with Lovell Minnick Partners are holders of Class B common stock and an equivalent number of New Class A Units.  Two managing directors of Lovell Minnick Partners serve as independent directors on the Company’s Board of Directors.

D&P Acquisitions made distributions to entities affiliated with Lovell Minnick Partners as summarized in the following table:

	Six Months Ended
	June 30,		June 30,
	2010		2009
Distributions for taxes	$	59	$	3,023
Other distributions		398		181
Payments pursuant to the TRA		-		-
	$	457	$	3,204

Distributions for taxes, other distributions and payments pursuant to the TRA are further described in Note 3.

An affiliate of Lovell Minnick Partners engaged the Company to provide certain consulting services.  As a result of services provided, the Company recorded $36 of revenues resulting from the engagement during the six months ended June 30, 2010.

Vestar Capital Partners

Entities affiliated with Vestar Capital Partners are holders of Class B common stock and an equivalent number of New Class A Units.  A managing director of Vestar Capital Partners serves as independent directors on the Company’s Board of Directors.

D&P Acquisitions made distributions to entities affiliated with Vestar Capital Partners as summarized in the following table:

	Six Months Ended
	June 30,		June 30,
	2010		2009
Distributions for taxes	$	74	$	3,644
Other distributions		552		251
Payments pursuant to the TRA		-		-
	$	626	$	3,895

Distributions for taxes, other distributions and payments pursuant to the TRA are further described in Note 3.

24

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

Note 16  - SUBSEQUENT EVENTS

In accordance with FASB ASC 855, Subsequent Events, management of the Company evaluated subsequent events.

Declaration of Quarterly Dividend

On July 29, 2010, the Company announced that its board of directors had declared a quarterly dividend of $0.06 per share on its outstanding Class A common stock.  The dividend is payable on August 27, 2010 to shareholders of record on August 17, 2010.  Concurrently with the payment of the dividend, the Company will also be distributing $0.06 per unit to holders of New Class A Units.

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Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Disclosure Regarding Forward-Looking Statements

This report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 (the “Exchange Act”), which reflect the Company’s current views with respect to, among other things, future events and financial performance.  The Company generally identifies forward looking statements by terminology such as “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “could,” “should,” “seeks,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates” or the negative version of those words or other comparable words.  Any forward-looking statements contained in this discussion are based upon our historical performance and on our current plans, estimates and expectations.  The inclusion of this forward-looking information should not be regarded as a representation by us, or any other person that the future plans, estimates or expectations contemplated by us will be achieved.  Such forward-looking statements are subject to various risks and uncertainties and assumptions relating to our operations, financial results, financial condition, business prospects, growth strategy and liquidity.  If one or more of these or other risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect, our actual results may vary materially from those indicated in these statements.  These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements and the risk factors section that are included in our Annual Report on Form 10-K for the year ended December 31, 2009 and any subsequent filings of our Quarterly Reports on Form 10-Q.  The forward-looking statements included in this Quarterly Report on Form 10-Q are made only as of the date of this filing with the Securities and Exchange Commission.  The Company does not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.

Critical Accounting Policies and Estimates

Management’s discussion and analysis of the Company’s financial condition and results of operations is based upon the Company’s consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”).  The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the financial statements and reported amounts of revenues and expenses during the periods presented.  Actual results could differ from these estimates.  Estimates and assumptions are reviewed periodically and the effects of revisions are reflected in the consolidated financial statements in the period they are deemed to be necessary.  Significant estimates made in the accompanying consolidated financial statements include, but are not limited to the following:

· proportional performance under client engagements for the purpose of determining revenue recognition,

· accounts receivable and unbilled services valuation,

· incentive compensation and other accrued benefits,

· useful lives of intangible assets,

· the carrying value of goodwill and intangible assets,

· amounts due to noncontrolling unitholders,

· reserves for estimated tax liabilities,

· contingent liabilities,

· certain estimates and assumptions used in the allocation of revenues and expenses for our segment reporting, and

· certain estimates and assumptions used in the calculation of the fair value of equity compensation issued to employees.

A summary of the Company’s critical accounting policies and estimates can be found in our Annual Report on Form 10-K for the year ended December 31, 2009.  Except for the implementation of a stock repurchase program, there have been no significant changes in new accounting pronouncements or in our critical accounting policies and estimates from those that were disclosed in our Annual Report on Form 10-K for the year ended December 31, 2009.  In conjunction with the stock repurchase program, repurchased shares are retired and recorded as a reduction to additional paid-in capital.

26

Results of Operations

We are a leading provider of independent financial advisory and investment banking services.  Our mission is to help our clients protect, maximize and recover value by providing independent advice on issues involving highly technical and complex assessments in the areas of valuation, transactions, financial restructuring, disputes and taxation.  We believe that the Duff & Phelps brand is associated with experienced professionals who give trusted guidance in a responsive manner.  We serve a global client base through offices in 24 cities, comprised of offices in 17 U.S. cities, including New York, Chicago, Dallas and Los Angeles, and seven international offices located in Amsterdam, London, Munich, Paris, Shanghai, Tokyo and Toronto.

We provide services through three segments:  Financial Advisory, Corporate Finance Consulting and Investment Banking.

Equity-based compensation discussed herein includes (a) grants of units of D&P Acquisitions prior to the recapitalization transaction that were effectuated in conjunction with the IPO (“Legacy Units”), (b) options to purchase shares of the Company’s Class A common stock granted in connection with the IPO (“IPO Options”) and (c) restricted stock awards and units issued in connection with the Company’s ongoing long-term compensation program (“Ongoing RSAs”).  The IPO, Recapitalization Transactions and the Company’s capital structure are further detailed in our Annual Report on Form 10-K for the year ended December 31, 2009.

Amounts are reported in thousands, except for per share amounts, headcount or where the context requires otherwise.

Overview

We are beginning to see modest improvements in certain areas of our business, particularly in certain areas relating to M&A activity.  We believe that many areas of our business, including M&A Advisory, Transaction Opinions, Due Diligence and Valuation Advisory should generally react favorably to the extent that there is an increase in overall transaction volume.  Our Global Restructuring business has continued to exhibit growth as a result of recent economic volatility, although such growth may be tempered if we enter a more robust period of economic recovery.  Certain other areas of our business which we believe have historically been less correlated to M&A volumes, such as Portfolio Valuation and Financial Engineering, have experienced lower growth in recent quarters as a result of the current economic environment. Overall, we believe that revenue and earnings for the first half of the year demonstrate the resiliency of our balanced portfolio of services and diversified client base, whose demand for complex financial advisory and valuation services continues.

27

Three months ended June 30, 2010 versus three months ended June 30, 2009

The results of operations are summarized as follows:

	Three Months Ended
	June 30,			June 30,			Unit			Percent
	2010			2009			Change			Change
Revenues	$	88,742		$	90,053		$	(1,311	)		(1.5	)%
Reimbursable expenses		1,962			2,626			(664	)		(25.3	)%
Total revenues		90,704			92,679			(1,975	)		(2.1	)%
Direct client service costs
Compensation and benefits(1)		50,415			51,698			(1,283	)		(2.5	)%
Other direct client service costs		1,881			1,543			338			21.9	%
Reimbursable expenses		2,039			2,637			(598	)		(22.7	)%
		54,335			55,878			(1,543	)		(2.8	)%
Operating expenses
Selling, general and administrative(2)		26,304			24,488			1,816			7.4	%
Depreciation and amortization		2,350			2,556			(206	)		(8.1	)%
Merger and acquisition costs		321			-			321			-
		28,975			27,044			1,931			7.1	%
Operating income		7,394			9,757			(2,363	)		(24.2	)%
Other expense/(income), net
Interest income		(53	)		(3	)		(50	)		1666.7	%
Interest expense		76			333			(257	)		(77.2	)%
Loss on early extinguishment of debt		-			1,737			(1,737	)		(100.0	)%
Other expense		247			70			177			252.9	%
		270			2,137			(1,867	)		(87.4	)%
Income before income taxes		7,124			7,620			(496	)		(6.5	)%
Provision for income taxes		2,506			2,421			85			3.5	%
Net income		4,618			5,199			(581	)		(11.2	)%
Less:  Net income attributable to noncontrolling interest		2,111			3,465			(1,354	)		(39.1	)%
Net income attributable to Duff & Phelps Corporation	$	2,507		$	1,734		$	773			44.6	%
Other financial and operating data
Adjusted EBITDA(3)(4)	$	14,599		$	16,794		$	(2,195	)		(13.1	)%
Adjusted EBITDA(3)(4) as a percentage of revenues		16.5	%		18.6	%		(2.1	)%		(11.3	)%
Adusted Pro Forma Net Income(3)(4)	$	7,203		$	8,084		$	(881	)		(10.9	)%
Adusted Pro Forma Net Income per fully exchanged, fully diluted share outstanding(3)(4)	$	0.19		$	0.22		$	(0.03	)		(13.6	)%
End of period managing directors		163			165			(2	)		(1.2	)%
End of period client service professionals		782			907			(125	)		(13.8	)%

(1)  Compensation and benefits include $4,215 and $5,075 of equity-based compensation expense for the three months ended June 30, 2010 and 2009, respectively.

(2)  Selling, general and administrative expenses include $2,005 and $1,665 of equity-based compensation expense for the three months ended June 30, 2010 and 2009, respectively.

28

(3) Adjusted EBITDA, Adjusted Pro Forma Net Income, and Adjusted Pro Forma Net Income per share are non-GAAP financial measures.  We believe that Adjusted EBITDA provides a relevant and useful alternative measure of our ongoing profitability and performance, when viewed in conjunction with GAAP measures, as it adjusts net income or loss attributable to Duff & Phelps Corporation for (a) net income or loss attributable to noncontrolling interest, (b) provision for income taxes, (c) interest expense and depreciation and amortization (a significant portion of which relates to debt and capital investments that have been incurred as the result of acquisitions and investments in stand-alone infrastructure which we do not expect to incur at the same levels in the future), (d) equity-based compensation associated with the Legacy Units of D&P Acquisitions, a significant portion of which is due to certain onetime grants associated with acquisitions prior to our IPO, and options to purchase shares of the Company’s Class A common stock granted in connection with the IPO, (e) impairment charges, acquisition retention expenses and other merger and acquisition costs, which are generally non-recurring in nature or are related to deferred payments associated with prior acquisitions, and (f) costs incurred from the realignment of our senior management which are generally non-recurring in nature and primarily include cash severance and charges from the accounting impact of the acceleration of vesting of restricted stock awards.

Given the level of acquisition activity during the period prior to our IPO, and related capital investments and one time equity grants associated with acquisitions during the this period (which we do not expect to incur at the same levels post IPO) and the IPO, and our belief that, as a professional services organization, our operations are not capital intensive on an ongoing basis, we believe the Adjusted EBITDA measure, in addition to GAAP financial measures, provides a relevant and useful benchmark for investors, in order to assess our financial performance and comparability to other companies in our industry.  The Adjusted EBITDA measure is utilized by our senior management to evaluate our overall performance and operating expense characteristics and to compare our performance to that of certain of our competitors.  A measure similar to Adjusted EBITDA is the principal measure that determines the compensation of our senior management team.  In addition, a measure similar to Adjusted EBITDA is a key measure that determines compliance with certain financial covenants under our credit facility.  Management compensates for the inherent limitations associated with using the Adjusted EBITDA measure through disclosure of such limitations, presentation of our financial statements in accordance with GAAP and reconciliation of Adjusted EBITDA to the most directly comparable GAAP measure, net income or loss.  Furthermore, management also reviews GAAP measures, and evaluates individual measures that are not included in Adjusted EBITDA such as our level of capital expenditures, equity issuance and interest expense, among other measures.

Adjusted EBITDA, as defined by the Company and reconciled below, consists of net income or loss attributable to Duff & Phelps Corporation before (a) net income or loss attributable to the noncontrolling interest, (b) provision for income taxes, (c) other expense/(income), net, (d) depreciation and amortization, (e) charges from impairment of intangible assets, (f) equity-based compensation associated with Legacy Units and IPO Options included in both compensation and benefits and in selling, general and administrative expenses, (g) acquisition retention expenses, (h) cash severance and equity-compensation expense from the acceleration of vesting of restricted stock awards due to the realignment of our senior management, and (i) merger and acquisition costs:

Reconciliation of Adjusted EBITDA

	Three Months Ended
	June 30,			June 30,
	2010			2009
Revenues (excluding client reimbursables)	$	88,742		$	90,053
Net income attributable to Duff & Phelps Corporation	$	2,507		$	1,734
Net income attributable to noncontrolling interest		2,111			3,465
Provision for income taxes		2,506			2,421
Other expense/(income), net		270			2,137
Depreciation and amortization		2,350			2,556
Equity-based compensation associated with Legacy Units and IPO Options		1,494			4,481
Charge from realignment of senior management (not included in equity-based compensation from Legacy Units and IPO Options above)		3,040			-
Merger and acquisition costs		321			-
Adjusted EBITDA	$	14,599		$	16,794
Adjusted EBITDA as a percentage of revenues		16.5	%		18.6	%

29

Adjusted Pro Forma Net Income, as defined by Duff & Phelps and reconciled below, consists of net income or loss attributable to Duff & Phelps Corporation before (a) net income or loss attributable to the noncontrolling interest, (b) a non-recurring charge from the repayment and subsequent termination of our former credit agreement, (c) equity-based compensation associated with Legacy Units and IPO Options included in both compensation and benefits and in selling, general and administrative expenses, (d) acquisition retention expenses, (e) cash severance and equity-compensation expense from the acceleration of vesting of restricted stock awards due to the realignment of our senior management, (f) merger and acquisition costs, and less (g) pro forma corporate income tax applied at an assumed rate as specified in the applicable footnote (such assumed pro forma corporate income tax rate may fluctuate between periods and may include true-ups relating to prior periods, based on management estimates and judgments).  Adjusted Pro Forma Net Income per share, as defined by Duff & Phelps, consists of Adjusted Pro Forma Net Income divided by the weighted average number of the Company's Class A and Class B shares for the applicable period, giving effect to the dilutive impact, if any, of stock options and restricted stock awards.

Reconciliation of Adjusted Pro Forma Net Income

	Three Months Ended
	June 30,			June 30,
	2010			2009
Net income attributable to Duff & Phelps Corporation	$	2,507		$	1,734
Net income attributable to noncontrolling interest(a)		2,111			3,465
Loss on early extinguishment of debt(b)		-			1,737
Equity-based compensation associated with Legacy Units and IPO Options(c)		1,494			4,481
Charge from realignment of senior management (not included in equity-based compensation from Legacy Units and IPO Options above)(4)		3,040			-
Merger and acquisition costs		321			-
Adjustment to provision for income taxes(d)		(2,270	)		(3,333	)
Adjusted Pro Forma Net Income, as defined	$	7,203		$	8,084
Pro forma fully exchanged, fully diluted shares outstanding(e)		38,681			36,780
Adjusted Pro Forma Net Income per fully exchanged, fully diluted share outstanding	$	0.19		$	0.22

(a) Represents elimination of the noncontrolling interest associated with the ownership by existing unitholders of D&P Acquisitions (excluding D&P Corporation), as if such unitholders had fully exchanged their partnership units and Class B common stock of the Company for shares of Class A common stock of the Company.

(b) Represents a non-recurring charge from the repayment and subsequent termination of our credit agreement.

(c) Represents elimination of equity-based compensation associated with Legacy Units and IPO Options.

(d) Represents an adjustment to reflect an assumed effective corporate tax rate of approximately 40.3% and 41.5% for the full year, as applied to the three months ended June 30, 2010 and 2009, respectively, which includes a provision for U.S. federal income taxes and assumes the highest statutory rates apportioned to each state, local and/or foreign jurisdiction.  For the three months ended June 30, 2010 and 2009, the pro forma tax rates of 39.9% and 41.6% reflect a true-up adjustment relating to the three months ended March 31, 2010 and 2009, respectively.  Assumes full exchange of existing unitholders' partnership units and Class B common stock of the Company into Class A common stock of the Company.

(e) Based on the weighted-average number of aggregated Class A and Class B shares of common stock outstanding, excluding Ongoing RSAs, and dilutive effect of Ongoing RSAs for the three months ended June 30, 2010 and 2009, respectively.  The Company believes that IPO Options would not be considered dilutive when applying the treasury method.

Both Adjusted EBITDA and Adjusted Pro Forma Net Income are non-GAAP financial measures which are not prepared in accordance with, and should not be considered alternatives to, measurements required by GAAP, such as operating income, net income or loss, net income or loss per share, cash flow from continuing operating activities or any other measure of performance or liquidity derived in accordance with GAAP.  The presentation of this additional information is not meant to be considered in isolation or as a substitute for the most directly comparable GAAP measures.  In addition, it should be noted that companies calculate Adjusted EBITDA and Adjusted Pro Forma Net Income differently and, therefore, Adjusted EBITDA and Adjusted Pro Forma Net Income as presented for us may not be comparable to Adjusted EBITDA and Adjusted Pro Forma Net Income reported by other companies.

30

(4) On April 22, 2010, we announced certain management changes related to the departure of our former president and one of our segment leaders.  We incurred a onetime charge associated with these changes of approximately $3,550 in our second quarter of 2010 related to cash severance and the accounting impact of accelerated vesting of equity-based awards.  Of this amount, approximately $3,040 primarily resulted from cash severance and a charge from the accelerated vesting of restricted stock awards which is added back to Adjusted EBITDA and Adjusted Pro Forma Net Income.  The remaining $510 related to a charge from the accelerated vesting of Legacy Units and IPO Options which is also added back to Adjusted EBITDA and Adjusted Pro Forma Net Income consistent with prior presentation.

Revenues

Revenues excluding reimbursable expenses decreased $1,311 or 1.5% to $88,742 for the three months ended June 30, 2010, compared to $90,053 for the three months ended June 30, 2009.  The decrease in revenues primarily resulted from a decrease in revenues from our Financial Advisory and Corporate Finance Consulting segments, partially offset by an increase in revenues from our Investment Banking segment, as summarized in the following table:

	Three Months Ended
	June 30,		June 30,		Dollar			Percent
	2010		2009		Change			Change
Financial Advisory
Valuation Advisory	$	32,829	$	33,772	$	(943	)		(2.8	)%
Tax Services		12,089		11,972		117			1.0	%
Dispute & Legal Management Consulting(1)		9,316		12,162		(2,846	)		(23.4	)%
		54,234		57,906		(3,672	)		(6.3	)%
Corporate Finance Consulting
Portfolio Valuation		4,642		4,338		304			7.0	%
Financial Engineering		3,355		5,159		(1,804	)		(35.0	)%
Strategic Value Advisory		2,883		3,588		(705	)		(19.6	)%
Due Diligence		2,439		1,893		546			28.8	%
		13,319		14,978		(1,659	)		(11.1	)%
Investment Banking
Global Restructuring Advisory		12,004		8,614		3,390			39.4	%
Transaction Opinions		6,041		6,180		(139	)		(2.2	)%
M&A Advisory		3,144		2,375		769			32.4	%
		21,189		17,169		4,020			23.4	%
Total Revenues (excluding reimbursables)	$	88,742	$	90,053	$	(1,311	)		(1.5	)%

(1) Includes $547 of revenue from our acquisition of Cole Valuation Partners Limited effective June 15, 2010.

Our Financial Advisory segment was impacted by lower revenues from Dispute & Legal Management Consulting and Valuation Advisory.  Dispute & Legal Management Consulting (and to a lesser extent certain business units in our Corporate Finance Consulting segment) was impacted by lower revenues from an engagement to serve as a financial advisor to the court appointed examiner of a large financial services company under bankruptcy protection.  This engagement wound down during the first half of 2010.  Valuation Advisory was impacted by a reduction of goodwill impairment testing due to the improvement in the overall economic environment, as the corresponding prior year quarter benefited from a significant volume of goodwill impairment testing as a result of the fallout from the financial crisis.  This decrease was partially offset by an increase in revenues from purchase price allocations and a higher volume of real estate valuation work.

Our Corporate Finance Consulting segment was impacted by lower revenues from Financial Engineering and Strategic Value Advisory, primarily due to lower revenues from an engagement to serve as a financial advisor to the court appointed examiner of a large financial services company under bankruptcy protection (as described above).  Our Due Diligence business, however, grew sequentially and as compared to the corresponding prior year quarter from an increase in M&A related activity.

Our Investment Banking segment benefited from continued strength in Global Restructuring Advisory and M&A Advisory versus the corresponding prior year quarter.

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Our client service headcount decreased to 782 client service professionals at June 30, 2010, compared to 878 client service professionals at December 31, 2009.  This decrease resulted from targeted reductions and attrition, partially offset by the addition of 20 client service professionals from our acquisition of Cole Valuation Partners Limited (“Cole”) and targeted hiring of professionals with specific expertise.

We had 163 client service managing directors at June 30, 2010, compared to 163 at December 31, 2009.  We added 17 managing directors from our acquisition of Cole, internal promotions and limited hiring.  These additions were principally offset by targeted reductions.

Direct Client Service Costs

Direct client service costs decreased $1,543 or 2.8% to $54,335 for the three months ended June 30, 2010, compared to $55,878 for the three months ended June 30, 2009.  Direct client service costs include compensation and benefits for client service employees, fees payable to contractors and other expenses related to the execution of engagements.

In addition, direct client service costs include a charge of approximately $540 from certain management changes announced on April 22, 2010 related to the departure of our former president and one of our segment leaders.  The Company incurred a onetime charge associated with these changes of approximately $3,550 in its second quarter of 2010 related to cash severance and the accounting impact of the accelerated vesting of equity-based awards.  Of this amount, approximately $540 was included as a charge to direct client service costs, primarily for cash severance related to the departure of one of our segment leaders.

The following table adjusts direct client service costs for equity-based compensation associated with Legacy Units and IPO Options, reimbursable expenses and a charge from the departure of our former president and one of our segment leaders:

Direct Client Service Costs

	Three Months Ended
	June 30,			June 30,
	2010			2009
Revenues (excluding reimbursables)	$	88,742		$	90,053
Total direct client service costs	$	54,335		$	55,878
Less:  equity-based compensation associated with Legacy Units and IPO Options		(636	)		(3,548	)
Less:  reimbursable expenses		(2,039	)		(2,637	)
Less:  charge from realignment of senior management		(540	)		-
Direct client service costs, as adjusted	$	51,120		$	49,693
Direct client service costs, as adjusted, as a percentage of revenues		57.6	%		55.2	%

Direct client service costs, as adjusted, increased between periods.  Higher equity-compensation expense from incremental grants of Ongoing RSAs, severance expense from a reduction in headcount and higher accrued compensation were partially offset by lower compensation and benefits from the reduction in headcount between periods.

Equity-based compensation from Legacy Units and IPO Options decreased between periods primarily as a result of the accelerated attribution of expense on awards with graded-tranche vesting in prior periods.

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Operating Expenses

Operating expenses increased $1,931 or 7.1% to $28,975 for the three months ended June 30, 2010, compared to $27,044 for the three months ended June 30, 2009.  The increase in operating expenses resulted from a $1,816 or 7.4% increase in selling, general and administrative expenses and $321 of merger and acquisition costs.  Selling, general and administrative expenses include a charge of approximately $3,010 from the departure of our former president, including approximately $510 related to Legacy Units and IPO Options.  Merger and acquisition costs resulted from our acquisition of Cole and include professional fees, incremental marketing expenses and incremental travel and entertainment.

The following table adjusts operating expenses for equity-based compensation associated with Legacy Units and IPO Options, depreciation and amortization, a charge from the departure of our former president and one of our segment leaders and merger and acquisition costs:

Operating Expenses

	Three Months Ended
	June 30,			June 30,
	2010			2009
Revenues (excluding reimbursables)	$	88,742		$	90,053
Total operating expenses	$	28,975		$	27,044
Less:  equity-based compensation associated with Legacy Units and IPO Options		(858	)		(933	)
Less:  depreciation and amortization		(2,350	)		(2,556	)
Less:  charge from realignment of senior management (not included in equity-based compensation from Legacy Units and IPO Options above)		(2,500	)		-
Less:  merger and acquisition costs		(321	)		-
Operating expenses, as adjusted	$	22,946		$	23,555
Operating expenses, as adjusted, as a percentage of revenues		25.9	%		26.2	%

Operating expenses, as adjusted, decreased between periods primarily from lower professional fees, bad debts and other general expenses.

Equity-based compensation from Legacy Units and  IPO Options decreased between periods primarily as a result of the accelerated attribution of expense on awards with graded-tranche vesting in prior periods, partially offset by the charge incurred from our realignment of senior management (as described above).

Other Income and Expenses

Other income and expenses include interest income, interest expense and other expense.  Interest expense decreased primarily as a result of repayment and termination of our former credit facility with General Electric Capital Corporation in May 2009.

Provision for Income Taxes

The provision for income taxes was $2,506 or 35.2% of income before income taxes for the three months ended June 30, 2010, compared to $2,421 or 31.8% of income before income taxes for the three months ended June 30, 2009.  The U.S. statutory income tax rate of 35% plus state and local statutory rates were decreased to the effective tax rate due to the fact that D&P Acquisitions, LLC and many of its subsidiaries operate as limited liability companies or other flow-through entities which are not subject to federal income tax.  This operating structure results in a rate benefit because a portion of the Company’s earnings are not subject to corporate level taxes.  This favorable impact is partially offset by an increase due to state and local taxes, the effect of permanent differences and foreign taxes.  The increase in the provision for income taxes as a percentage of income before income taxes resulted primarily from a decrease in the rate benefit from operating as an LLC, due to an increase in Duff & Phelps Corporation’s ownership of D&P Acquisitions, LLC.

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Net Income Attributable to the Noncontrolling Interest

Net income attributable to the noncontrolling interest represents the portion of net income or loss before income taxes attributable to the ownership interest in D&P Acquisitions held by the existing unitholders to the extent the book value of their interest in D&P Acquisitions is greater than zero.  This interest totaled 31.4% and 40.4% at June 30, 2010 and 2009, respectively.

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Segment Results – Three months ended June 30, 2010 versus three months ended June 30, 2009

The following table sets forth selected segment operating results:

Results of Operations by Segment

	Three Months Ended
	June 30,			June 30,			Unit			Percent
	2010			2009			Change			Change
Financial Advisory
Revenues (excluding reimbursables)	$	54,234		$	57,906		$	(3,672	)		(6.3	)%
Segment operating income	$	8,449		$	10,339		$	(1,890	)		(18.3	)%
Segment operating income margin		15.6	%		17.9	%		(2.3	)%		(12.8	)%
Corporate Finance Consulting
Revenues (excluding reimbursables)	$	13,319		$	14,978		$	(1,659	)		(11.1	)%
Segment operating income	$	1,177		$	3,178		$	(2,001	)		(63.0	)%
Segment operating income margin		8.8	%		21.2	%		(12.4	)%		(58.5	)%
Investment Banking
Revenues (excluding reimbursables)	$	21,189		$	17,169		$	4,020			23.4	%
Segment operating income	$	5,050		$	3,288		$	1,762			53.6	%
Segment operating income margin		23.8	%		19.2	%		4.6	%		24.0	%
Total
Revenues (excluding reimbursables)	$	88,742		$	90,053
Segment operating income	$	14,676		$	16,805
Net client reimbursable expenses		(77	)		(11	)
Equity-based compensation from
Legacy Units and IPO Options		(1,494	)		(4,481	)
Depreciation and amortization		(2,350	)		(2,556	)
Charge from realignment of senior management (not included in equity-based compensation from Legacy Units and IPO Options above)		(3,040	)		-
Merger and acquisition costs		(321	)		-
Operating income	$	7,394		$	9,757

Average Client Service Professionals
Financial Advisory		566		658		(92	)	(14.0	)%
Corporate Finance Consulting		113		134		(21	)	(15.7	)%
Investment Banking		127		135		(8	)	(5.9	)%
Total		806		927		(121	)	(13.1	)%
End of Period Client Service Professionals
Financial Advisory		548		640		(92	)	(14.4	)%
Corporate Finance Consulting		109		136		(27	)	(19.9	)%
Investment Banking		125		131		(6	)	(4.6	)%
Total		782		907		(125	)	(13.8	)%
Revenue per Client Service Professional
Financial Advisory	$	96	$	88	$	8		9.1	%
Corporate Finance Consulting	$	118	$	112	$	6		5.4	%
Investment Banking	$	167	$	127	$	40		31.5	%
Total	$	110	$	97	$	13		13.4	%

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Results of Operations by Segment – Continued

	Three Months Ended
	June 30,			June 30,			Unit			Percent
	2010			2009			Change			Change
Utilization(1)
Financial Advisory		63.9	%		62.3	%		1.6	%		2.6	%
Corporate Finance Consulting		56.7	%		60.2	%		(3.5	)%		(5.8	)%
Rate-Per-Hour(2)
Financial Advisory	$	356		$	328		$	28			8.5	%
Corporate Finance Consulting	$	438		$	393		$	45			11.5	%

Revenues (excluding reimbursables)
Financial Advisory	$	54,234	$	57,906	$	(3,672	)	(6.3	)%
Corporate Finance Consulting		13,319		14,978		(1,659	)	(11.1	)%
Investment Banking		21,189		17,169		4,020		23.4	%
Total	$	88,742	$	90,053	$	(1,311	)	(1.5	)%
Average Number of Managing Directors
Financial Advisory		91		99		(8	)	(8.1	)%
Corporate Finance Consulting		30		30		-		0.0	%
Investment Banking		41		39		2		5.1	%
Total		162		168		(6	)	(3.6	)%
End of Period Managing Directors
Financial Advisory		94		96		(2	)	(2.1	)%
Corporate Finance Consulting		29		31		(2	)	(6.5	)%
Investment Banking		40		38		2		5.3	%
Total		163		165		(2	)	(1.2	)%
Revenue per Managing Director
Financial Advisory	$	596	$	585	$	11		1.9	%
Corporate Finance Consulting	$	444	$	499	$	(55	)	(11.0	)%
Investment Banking	$	517	$	440	$	77		17.5	%
Total	$	548	$	536	$	12		2.2	%

 (1) The utilization rate for any given period is calculated by dividing the number of hours incurred by client service professionals who worked on client assignments (including internal projects for the Company) during the period by the total available working hours for all of such client service professionals during the same period, assuming a 40 hour work week, less paid holidays and vacation days.  Financial Advisory utilization excludes approximately 60 client service professionals associated with Rash & Associates, L.P. (“Rash”), a wholly-owned subsidiary, due to the nature of the work performed.

(2) Average billing rate-per-hour is calculated by dividing applicable revenues for the period by the number of hours worked on client assignments (including internal projects for the Company) during the same period.  Financial Advisory revenues used to calculate rate-per-hour exclude approximately $1,798 and $2,430 of revenues associated with Rash in the three months ended June 30, 2010 and 2009, respectively.

For segment reporting purposes, management uses certain estimates and assumptions to allocate revenues and expenses.  Revenues and expenses attributable to reportable segments are generally based on which segment and product line a client service professional is a dedicated member.  As a result, revenues recognized that relate to the cross utilization of client service professionals across reportable segments occur each period depending on the expertise required for each engagement.  In particular, the Financial Advisory segment (primarily Valuation Advisory services) recognized revenues of $1,247 and $2,245 from the cross utilization of its client service professionals on engagements from the Corporate Finance Consulting segment (primarily Portfolio Valuation services) in the three months ended June 30, 2010 and 2009, respectively.

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Financial Advisory

Revenues

Revenues from the Financial Advisory segment decreased $3,672 or 6.3% to $54,234 for the three months ended June 30, 2010, compared to $57,906 for the three months ended June 30, 2009.  The overall decline resulted from a decrease in revenues from Valuation Advisory and Dispute & Legal Management Consulting business units, as summarized in the following table:

	Three Months Ended
	June 30,		June 30,		Dollar			Percent
	2010		2009		Change			Change
Financial Advisory
Valuation Advisory	$	32,829	$	33,772	$	(943	)		(2.8	)%
Tax Services		12,089		11,972		117			1.0	%
Dispute & Legal Management Consulting(1)		9,316		12,162		(2,846	)		(23.4	)%
	$	54,234	$	57,906	$	(3,672	)		(6.3	)%

(1) Includes $547 of revenue from our acquisition of Cole Valuation Partners Limited effective June 15, 2010.

Our Financial Advisory segment was impacted by lower revenues from Dispute & Legal Management Consulting and Valuation Advisory.  Dispute & Legal Management Consulting (and to a lesser extent certain business units in our Corporate Finance Consulting segment) was impacted by the winding down in the first half of 2010 of an engagement to serve as a financial advisor to the court appointed examiner of a large financial services company under bankruptcy protection.  Our results for the second quarter include approximately $2,700 of revenue from this assignment, primarily recognized in the Financial Advisory and Corporate Finance Consulting segments, compared to approximately $7,700 of revenue recognized in the corresponding prior year quarter.

Valuation Advisory was impacted by a reduction of goodwill impairment testing due to the improvement in the overall economic environment, as the corresponding prior year quarter benefited from a significant volume of goodwill impairment testing as a result of the fallout from the financial crisis.  The decrease in revenues from goodwill impairment testing was partially offset by an increase in revenues from purchase price allocations and a higher volume of real estate valuation work.

The increase in revenues from Tax Services primarily resulted from property tax contingent fees and transfer pricing activity, partially offset by the departure of staff during the first half of 2010 associated with World Tax Service US, LLC (which we acquired in July 2008) and a related practice.

Segment Operating Income

Financial Advisory segment operating income decreased $1,890 or 18.3% to $8,449 for the three months ended June 30, 2010, compared to $10,339 for the three months ended June 30, 2009.  Segment operating income margin, defined as segment operating income expressed as a percentage of segment revenues, was 15.6% for the three months ended June 30, 2010, compared to 17.9% for the three months ended June 30, 2009.  Segment operating income and margin decreased as a result of lower revenues which led to a corresponding increase in direct client service costs as a percentage of revenues and from higher equity-compensation expense from incremental grants of Ongoing RSAs.

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Corporate Finance Consulting

Revenues

Revenues from the Corporate Finance Consulting segment decreased $1,659 or 11.1% to $13,319 for the three months ended June 30, 2010, compared to $14,978 for the three months ended June 30, 2009.  Lower revenues from Financial Engineering and Strategic Value Advisory were partially offset by higher revenues from Due Diligence and Portfolio Valuation, as summarized in the following table:

	Three Months Ended
	June 30,		June 30,		Dollar			Percent
	2010		2009		Change			Change
Corporate Finance Consulting
Portfolio Valuation	$	4,642	$	4,338	$	304			7.0	%
Financial Engineering		3,355		5,159		(1,804	)		(35.0	)%
Strategic Value Advisory		2,883		3,588		(705	)		(19.6	)%
Due Diligence		2,439		1,893		546			28.8	%
	$	13,319	$	14,978	$	(1,659	)		(11.1	)%

Our Corporate Finance Consulting segment was impacted by lower revenues from Financial Engineering and Strategic Value Advisory, primarily due to lower revenues from an engagement to serve as a financial advisor to the court appointed examiner of a large financial services company under bankruptcy protection (as described in Financial Advisory above).  Our Due Diligence business, however, grew sequentially and as compared to the corresponding prior year quarter from an increase in M&A related activity.

Segment Operating Income

Operating income from the Corporate Finance Consulting segment decreased $2,001 or 63.0% to $1,177 for the three months ended June 30, 2010, compared to $3,178 for the three months ended June 30, 2009.  Segment operating income margin was 8.8% for the three months ended June 30, 2010, compared to 21.2% for the three months ended June 30, 2009.  The decrease in segment operating income and margin primarily resulted from lower revenues and an increase in direct client service costs as a percentage of revenues, principally from higher equity-compensation expense from incremental grants of Ongoing RSAs.

Investment Banking

Revenues

Revenues from the Investment Banking segment increased $4,020 or 23.4% to $21,189 for the three months ended June 30, 2010, compared to $17,169 for the three months ended June 30, 2009, as summarized in the following table:

	Three Months Ended
	June 30,		June 30,		Dollar			Percent
	2010		2009		Change			Change
Investment Banking
Global Restructuring Advisory	$	12,004	$	8,614	$	3,390			39.4	%
Transaction Opinions		6,041		6,180		(139	)		(2.2	)%
M&A Advisory		3,144		2,375		769			32.4	%
	$	21,189	$	17,169	$	4,020			23.4	%

Global Restructuring Advisory benefited from success fees related to our domestic and international restructuring services.  Revenues from M&A Advisory increased as a result of a higher level of transactional activity.

Segment Operating Income

Operating income from the Investment Banking segment increased $1,762 or 53.6% to $5,050 for the three months ended June 30, 2010, compared to $3,288 for the three months ended June 30, 2009.  Operating income margin was 23.8% for the three months ended June 30, 2010, compared to 19.2% for the three months ended June 30, 2009.  The increase in segment operating income and margin resulted from higher revenues driven in part by additional success fees.

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Six months ended June 30, 2010 versus six months ended June 30, 2009

The results of operations are summarized as follows:

	Six Months Ended
	June 30,			June 30,			Unit			Percent
	2010			2009			Change			Change
Revenues	$	177,906		$	179,318		$	(1,412	)		(0.8	)%
Reimbursable expenses		4,760			4,663			97			2.1	%
Total revenues		182,666			183,981			(1,315	)		(0.7	)%
Direct client service costs
Compensation and benefits(1)		99,013			102,828			(3,815	)		(3.7	)%
Other direct client service costs		3,869			2,847			1,022			35.9	%
Reimbursable expenses		4,893			4,652			241			5.2	%
		107,775			110,327			(2,552	)		(2.3	)%
Operating expenses
Selling, general and administrative(2)		50,388			49,428			960			1.9	%
Depreciation and amortization		4,843			5,118			(275	)		(5.4	)%
Charge from impairment of certain intangible assets		674			-			674			-
Merger and acquisition costs		321			-			321			-
		56,226			54,546			1,680			3.1	%
Operating income		18,665			19,108			(443	)		(2.3	)%
Other expense/(income), net
Interest income		(77	)		(17	)		(60	)		352.9	%
Interest expense		168			988			(820	)		(83.0	)%
Loss on early extinguishment of debt		-			1,737			(1,737	)		(100.0	)%
Other expense		232			87			145			166.7	%
		323			2,795			(2,472	)		(88.4	)%
Income before income taxes		18,342			16,313			2,029			12.4	%
Provision for income taxes		6,156			4,533			1,623			35.8	%
Net income		12,186			11,780			406			3.4	%
Less:  Net income attributable to noncontrolling interest		5,406			8,281			(2,875	)		(34.7	)%
Net income attributable to Duff & Phelps Corporation	$	6,780		$	3,499		$	3,281			93.8	%
Other financial and operating data
Adjusted EBITDA(3)	$	30,120		$	31,959		$	(1,839	)		(5.8	)%
Adjusted EBITDA(3) as a percentage of revenues		16.9	%		17.8	%		(0.9	)%		(5.1	)%
Adusted Pro Forma Net Income(3)	$	14,485		$	15,083		$	(593	)		(3.9	)%
Adusted Pro Forma Net Income per fully exchanged, fully diluted share outstanding(3)	$	0.37		$	0.42		$	(0.05	)		(11.9	)%
End of period managing directors		163			165			(2	)		(1.2	)%
End of period client service professionals		782			907			(125	)		(13.8	)%

(1) Compensation and benefits include $7,932 and $9,338 of equity-based compensation expense for the six months ended June 30, 2010 and 2009, respectively.

(2) Selling, general and administrative expenses include $3,458 and $3,556 of equity-based compensation expense for the six months ended June 30, 2010 and 2009, respectively.

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(3) Adjusted EBITDA, Adjusted Pro Forma Net Income, and Adjusted Pro Forma Net Income per share are non-GAAP financial measures.  We believe that Adjusted EBITDA provides a relevant and useful alternative measure of our ongoing profitability and performance, when viewed in conjunction with GAAP measures, as it adjusts net income or loss attributable to Duff & Phelps Corporation for (a) net income or loss attributable to noncontrolling interest, (b) provision for income taxes, (c) interest expense and depreciation and amortization (a significant portion of which relates to debt and capital investments that have been incurred as the result of acquisitions and investments in stand-alone infrastructure which we do not expect to incur at the same levels in the future), (d) equity-based compensation associated with the Legacy Units of D&P Acquisitions, a significant portion of which is due to certain onetime grants associated with acquisitions prior to our IPO, and options to purchase shares of the Company’s Class A common stock granted in connection with the IPO, (e) impairment charges, acquisition retention expenses and other merger and acquisition costs, which are generally non-recurring in nature or are related to deferred payments associated with prior acquisitions, and (f) costs incurred from the realignment of our senior management which are generally non-recurring in nature and primarily include cash severance and charges from the accounting impact of the acceleration of vesting of restricted stock awards.

Given the level of acquisition activity during the period prior to our IPO, and related capital investments and one time equity grants associated with acquisitions during the this period (which we do not expect to incur at the same levels post IPO) and the IPO, and our belief that, as a professional services organization, our operations are not capital intensive on an ongoing basis, we believe the Adjusted EBITDA measure, in addition to GAAP financial measures, provides a relevant and useful benchmark for investors, in order to assess our financial performance and comparability to other companies in our industry.  The Adjusted EBITDA measure is utilized by our senior management to evaluate our overall performance and operating expense characteristics and to compare our performance to that of certain of our competitors.  A measure similar to Adjusted EBITDA is the principal measure that determines the compensation of our senior management team.  In addition, a measure similar to Adjusted EBITDA is a key measure that determines compliance with certain financial covenants under our credit facility.  Management compensates for the inherent limitations associated with using the Adjusted EBITDA measure through disclosure of such limitations, presentation of our financial statements in accordance with GAAP and reconciliation of Adjusted EBITDA to the most directly comparable GAAP measure, net income or loss.  Furthermore, management also reviews GAAP measures, and evaluates individual measures that are not included in Adjusted EBITDA such as our level of capital expenditures, equity issuance and interest expense, among other measures.

Adjusted EBITDA, as defined by the Company and reconciled below, consists of net income or loss attributable to Duff & Phelps Corporation before (a) net income or loss attributable to the noncontrolling interest, (b) provision for income taxes, (c) other expense/(income), net, (d) depreciation and amortization, (e) charges from impairment of intangible assets, (f) equity-based compensation associated with Legacy Units and IPO Options included in both compensation and benefits and in selling, general and administrative expenses, (g) acquisition retention expenses, (h) cash severance and equity-compensation expense from the acceleration of vesting of restricted stock awards due to the realignment of our senior management, and (i) merger and acquisition costs:

Reconciliation of Adjusted EBITDA

	Six Months Ended
	June 30,			June 30,
	2010			2009
Revenues (excluding client reimbursables)	$	177,906		$	179,318
Net income attributable to Duff & Phelps Corporation	$	6,780		$	3,499
Net income attributable to noncontrolling interest		5,406			8,281
Provision for income taxes		6,156			4,533
Other expense/(income), net		323			2,795
Depreciation and amortization		4,843			5,118
Charge from impairment of certain intangible assets		674			-
Equity-based compensation associated with Legacy Units and IPO Options		2,577			7,733
Charge from realignment of senior management (not included in equity-based compensation from Legacy Units and IPO Options above)(4)		3,040			-
Merger and acquisition costs		321			-
Adjusted EBITDA	$	30,120		$	31,959
Adjusted EBITDA as a percentage of revenues		16.9	%		17.8	%

40

Adjusted Pro Forma Net Income, as defined by Duff & Phelps and reconciled below, consists of net income or loss attributable to Duff & Phelps Corporation before (a) net income or loss attributable to the noncontrolling interest, (b) a non-recurring charge from the repayment and subsequent termination of our former credit agreement, (c) equity-based compensation associated with Legacy Units and IPO Options included in both compensation and benefits and in selling, general and administrative expenses, (d) acquisition retention expenses, (e) cash severance and equity-compensation expense from the acceleration of vesting of restricted stock awards due to the realignment of our senior management, (f) merger and acquisition costs, and less (g) pro forma corporate income tax applied at an assumed rate as specified in the applicable footnote (such assumed pro forma corporate income tax rate may fluctuate between periods and may include true-ups relating to prior periods, based on management estimates and judgments). Adjusted Pro Forma Net Income per share, as defined by Duff & Phelps, consists of Adjusted Pro Forma Net Income divided by the weighted average number of the Company's Class A and Class B shares for the applicable period, giving effect to the dilutive impact, if any, of stock options and restricted stock awards.

Reconciliation of Adjusted Pro Forma Net Income

	Six Months Ended
	June 30,			June 30,
	2010			2009
Net income attributable to Duff & Phelps Corporation	$	6,780		$	3,499
Net income attributable to noncontrolling interest(a)		5,406			8,281
Loss on early extinguishment of debt(b)		-			1,737
Equity-based compensation associated with Legacy Units and IPO Options(c)		2,577			7,733
Charge from realignment of senior management (not included in equity-based compensation from Legacy Units and IPO Options above)(4)		3,040			-
Merger and acquisition costs		321			-
Adjustment to provision for income taxes(d)		(3,639	)		(6,167	)
Adjusted Pro Forma Net Income, as defined	$	14,485		$	15,083
Pro forma fully exchanged, fully diluted shares outstanding(e)		38,850			35,818
Adjusted Pro Forma Net Income per fully exchanged, fully diluted share outstanding	$	0.37		$	0.42

(a) Represents elimination of the noncontrolling interest associated with the ownership by existing unitholders of D&P Acquisitions (excluding D&P Corporation), as if such unitholders had fully exchanged their partnership units and Class B common stock of the Company for shares of Class A common stock of the Company.

(b) Represents a non-recurring charge from the repayment and subsequent termination of our credit agreement.

(c) Represents elimination of equity-based compensation associated with Legacy Units and IPO Options.

(d) Represents an adjustment to reflect an assumed effective corporate tax rate of approximately 40.3% and 41.5% for the full year, as applied to the six months ended June 30, 2010 and 2009, respectively, which includes a provision for U.S. federal income taxes and assumes the highest statutory rates apportioned to each state, local and/or foreign jurisdiction. Assumes full exchange of existing unitholders' partnership units and Class B common stock of the Company into Class A common stock of the Company.

(e) Based on the weighted-average number of aggregated Class A and Class B shares of common stock outstanding, excluding Ongoing RSAs, and dilutive effect of Ongoing RSAs for the three months ended June 30, 2010 and 2009, respectively. The Company believes that IPO Options would not be considered dilutive when applying the treasury method.

Both Adjusted EBITDA and Adjusted Pro Forma Net Income are non-GAAP financial measures which are not prepared in accordance with, and should not be considered alternatives to, measurements required by GAAP, such as operating income, net income or loss, net income or loss per share, cash flow from continuing operating activities or any other measure of performance or liquidity derived in accordance with GAAP. The presentation of this additional information is not meant to be considered in isolation or as a substitute for the most directly comparable GAAP measures. In addition, it should be noted that companies calculate Adjusted EBITDA and Adjusted Pro Forma Net Income differently and, therefore, Adjusted EBITDA and Adjusted Pro Forma Net Income as presented for us may not be comparable to Adjusted EBITDA and Adjusted Pro Forma Net Income reported by other companies.

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(4) On April 22, 2010, we announced certain management changes related to the departure of our former president and one of our segment leaders. We incurred a onetime charge associated with these changes of approximately $3,550 in our second quarter of 2010 related to cash severance and the accounting impact of accelerated vesting of equity-based awards. Of this amount, approximately $3,040 primarily resulted from cash severance and a charge from the accelerated vesting of restricted stock awards which is added back to Adjusted EBITDA and Adjusted Pro Forma Net Income. The remaining $510 related to a charge from the accelerated vesting of Legacy Units and IPO Options which is also added back to Adjusted EBITDA and Adjusted Pro Forma Net Income consistent with prior presentation.

Revenues

Revenues excluding reimbursable expenses decreased $1,412 or 0.8% to $177,906 for the six months ended June 30, 2010, compared to $179,318 for the six months ended June 30, 2009. The decrease in revenues primarily resulted from a decrease in revenues from our Financial Advisory and Corporate Finance Consulting segments, partially offset by an increase in revenues from our Investment Banking segment, as summarized in the following table:

	Six Months Ended
	June 30,		June 30,		Dollar			Percent
	2010		2009		Change			Change
Financial Advisory
Valuation Advisory	$	67,849	$	74,142	$	(6,293	)		(8.5	)%
Tax Services		21,536		22,850		(1,314	)		(5.8	)%
Dispute & Legal Management Consulting (1)		18,731		21,805		(3,074	)		(14.1	)%
		108,116		118,797		(10,681	)		(9.0	)%
Corporate Finance Consulting
Portfolio Valuation		10,124		10,633		(509	)		(4.8	)%
Financial Engineering		7,481		9,307		(1,826	)		(19.6	)%
Strategic Value Advisory		6,041		6,208		(167	)		(2.7	)%
Due Diligence		4,609		3,446		1,163			33.7	%
		28,255		29,594		(1,339	)		(4.5	)%
Investment Banking
Global Restructuring Advisory		21,845		14,192		7,653			53.9	%
Transaction Opinions		12,864		12,281		583			4.7	%
M&A Advisory		6,826		4,454		2,372			53.3	%
		41,535		30,927		10,608			34.3	%
Total Revenues (excluding reimbursables)	$	177,906	$	179,318	$	(1,412	)		(0.8	)%

(1) Includes $547 of revenue from our acquisition of Cole Valuation Partners Limited effective June 15, 2010.

Our Financial Advisory segment was impacted by lower revenues from each business unit. Valuation Advisory was impacted by a reduction of goodwill impairment testing due to the improvement in the overall economic environment, as the corresponding prior year period benefited from a significant volume of goodwill impairment testing as a result of the fallout from the financial crisis. This decrease was partially offset by an increase in revenues from purchase price allocations and a higher volume of real estate valuation work. The decrease in revenues from Tax Services primarily resulted from the departure of staff during the first half of 2010 associated with World Tax Service US, LLC (which we acquired in July 2008) and a related practice, partially offset by an increase in revenues from property tax contingent fees and transfer pricing activity. Dispute & Legal Management Consulting (and to a lesser extent certain business units in our Corporate Finance Consulting segment) was impacted by lower revenues from an engagement to serve as a financial advisor to the court appointed examiner of a large financial services company under bankruptcy protection. This engagement wound down during the first half of 2010.

Our Corporate Finance Consulting segment was impacted by lower revenues from Portfolio Valuation, Financial Engineering and Strategic Value Advisory. Financial Engineering and Strategic Value Advisory were primarily impacted by lower revenues from an engagement to serve as a financial advisor to the court appointed examiner of a large financial services company under bankruptcy protection (as described above). Our Due Diligence business, however, grew  sequentially and as compared to results from the corresponding prior year period from an increase in M&A related activity.

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Each of our business units in the Investment Banking segment demonstrated continued strength, especially Global Restructuring Advisory and M&A Advisory, versus the corresponding prior year period.

Our client service headcount decreased to 782 client service professionals at June 30, 2010, compared to 878 client service professionals at December 31, 2009. This decrease resulted from targeted reductions and attrition, partially offset by the addition of 20 client service professionals from our acquisition of Cole  and targeted hiring of professionals with specific expertise.

We had 163 client service managing directors at June 30, 2010, compared to 163 at December 31, 2009. We added 17 managing directors from our acquisition of Cole, internal promotions and limited hiring. These additions were principally offset by targeted reductions.

Direct Client Service Costs

Direct client service costs decreased $2,552 or 2.3% to $107,775 for the six months ended June 30, 2010, compared to $110,327 for the six months ended June 30, 2009. Direct client service costs include compensation and benefits for client service employees, fees payable to contractors and other expenses related to the execution of engagements.

In addition, direct client service costs include a charge of approximately $540 from certain management changes announced on April 22, 2010, including the departure of our former president and one of our segment leaders. The Company incurred a onetime charge associated with these changes of approximately $3,550 in its second quarter of 2010 related to cash severance and the accounting impact of the accelerated vesting of equity-based awards. Of this amount, approximately $540 was included as a charge to direct client service costs, primarily for cash severance related to the departure of one of our segment leaders.

The following table adjusts direct client service costs for equity-based compensation associated with Legacy Units and IPO Options, reimbursable expenses and the charge from the departure of our former president and one of our segment leaders:

Direct Client Service Costs

	Six Months Ended
	June 30,			June 30,
	2010			2009
Revenues (excluding reimbursables)	$	177,906		$	179,318
Total direct client service costs	$	107,775		$	110,327
Less:  equity-based compensation associated with Legacy Units and IPO Options		(1,234	)		(5,880	)
Less:  reimbursable expenses		(4,893	)		(4,652	)
Less:  charge from realignment of senior management		(540	)
Direct client service costs, as adjusted	$	101,108		$	99,795
Direct client service costs, as adjusted, as a percentage of revenues		56.8	%		55.7	%

Direct client service costs, as adjusted, increased between periods. Higher equity-compensation expense from incremental grants of Ongoing RSAs, severance expense from a reduction in headcount and higher accrued compensation were partially offset by lower compensation and benefits from the reduction in headcount between periods.

Equity-based compensation from Legacy Units and IPO Options decreased between periods primarily as a result of the accelerated attribution of expense on awards with graded-tranche vesting in prior periods for Legacy Units and IPO Options.

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Operating Expenses

Operating expenses increased $1,680 or 3.1% to $56,226 for the six months ended June 30, 2010, compared to $54,546 for the six months ended June 30, 2009. Selling, general and administrative expenses include a charge of approximately $3,010 from the departure of our former president, including approximately $510 related to Legacy Units and IPO Options. In addition, operating expenses include a $674 onetime charge from the impairment of certain intangible assets that originated from our acquisition of WTS in July 2008. The impairment resulted from the departure of the two managing directors who ran this group and associated staff in March 2010. WTS operated as part of our Financial Advisory segment. Also, merger and acquisition costs resulted from our acquisition of Cole and include professional fees, incremental marketing expenses and incremental travel and entertainment.

The following table adjusts operating expenses for equity-based compensation associated with Legacy Units and IPO Options, depreciation and amortization, a charge to impair certain intangible assets, the charge from the departure of our former president and one of our segment leaders and merger and acquisition costs:

Operating Expenses

	Six Months Ended
	June 30,			June 30,
	2010			2009
Revenues (excluding reimbursables)	$	177,906		$	179,318
Total operating expenses	$	56,226		$	54,546
Less:  equity-based compensation associated with Legacy Units and IPO Options		(1,343	)		(1,853	)
Less:  depreciation and amortization		(4,843	)		(5,118	)
Less:  charge to impair certain intangible assets		(674	)		-
Less:  charge from realignment of senior management (not included in equity-based compensation from Legacy Units and IPO Options above)		(2,500	)		-
Less:  merger and acquisition costs		(321	)		-
Operating expenses, as adjusted	$	46,545		$	47,575
Operating expenses, as adjusted, as a percentage of revenues		26.2	%		26.5	%

Operating expenses, as adjusted, decreased between periods primarily from lower professional fees and other general expenses.

Equity-based compensation from Legacy Units and IPO Options decreased between periods primarily as a result of the accelerated attribution of expense on awards with graded-tranche vesting in prior periods, partially offset by the charge incurred from our realignment of senior management (as described above).

Other Income and Expenses

Other income and expenses include interest income, interest expense and other expense. Interest expense decreased primarily as a result of repayment and termination of our former credit facility with General Electric Capital Corporation in May 2009.

Provision for Income Taxes

The provision for income taxes was $6,156 or 33.6% of income before income taxes for the six months ended June 30, 2010, compared to $4,533 or 27.8% of income before income taxes for the six months ended June 30, 2009. The U.S. statutory income tax rate of 35% plus state and local statutory rates were decreased to the effective tax rate due to the fact that D&P Acquisitions, LLC and many of its subsidiaries operate as limited liability companies or other flow-through entities which are not subject to federal income tax. This operating structure results in a rate benefit because a portion of the Company’s earnings are not subject to corporate level taxes. This favorable impact is partially offset by an increase due to state and local taxes, the effect of permanent differences and foreign taxes. The increase in the provision for income taxes as a percentage of income before income taxes resulted primarily from a decrease in the rate benefit from operating as an LLC, due to an increase in Duff & Phelps Corporation’s ownership of D&P Acquisitions, LLC.

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Net Income Attributable to the Noncontrolling Interest

Net income attributable to the noncontrolling interest represents the portion of net income or loss before income taxes attributable to the ownership interest in D&P Acquisitions held by the existing unitholders to the extent the book value of their interest in D&P Acquisitions is greater than zero. This interest totaled 31.4% and 40.4% at June 30, 2010 and 2009, respectively.

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Segment Results – Six months ended June 30, 2010 versus six months ended June 30, 2009

The following table sets forth selected segment operating results:

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Results of Operations by Segment

	SixMonthsEnded
	June30,			June30,			Unit			Percent
	2010			2009			Change			Change
Financial Advisory
Revenues (excluding reimbursables)	$	108,116		$	118,797		$	(10,681	)		(9.0	)%
Segment operating income	$	15,987		$	20,688		$	(4,701	)		(22.7	)%
Segment operating income margin		14.8	%		17.4	%		(2.6	)%		(14.9	)%
Corporate Finance Consulting
Revenues (excluding reimbursables)	$	28,255		$	29,594		$	(1,339	)		(4.5	)%
Segment operating income	$	4,159		$	6,430		$	(2,271	)		(35.3	)%
Segment operating income margin		14.7	%		21.7	%		(7.0	)%		(32.3	)%
Investment Banking
Revenues (excluding reimbursables)	$	41,535		$	30,927		$	10,608			34.3	%
Segment operating income	$	10,107		$	4,831		$	5,276			109.2	%
Segment operating income margin		24.3	%		15.6	%		8.7	%		55.8	%
Total
Revenues (excluding reimbursables)	$	177,906		$	179,318
Segment operating income	$	30,253		$	31,949
Net client reimbursable expenses		(133	)		11
Equity-based compensation from Legacy Units and IPO Options		(2,577	)		(7,734	)
Depreciation and amortization		(4,843	)		(5,118	)
Charge from impairment of certain intangible assets		(674	)
Charge from realignment of senior management (not included in equity-based compensation from Legacy Units or IPO Options above)		(3,040	)		-
Merger and acquisition costs		(321	)		-
Operating income	$	18,665		$	19,108
Average Client Service Professionals
Financial Advisory		587			679			(92	)		(13.5	)%
Corporate Finance Consulting		119			133			(14	)		(10.5	)%
Investment Banking		129			135			(6	)		(4.4	)%
Total		835			947			(112	)		(11.8	)%
End of Period Client Service Professionals
Financial Advisory		548			640			(92	)		(14.4	)%
Corporate Finance Consulting		109			136			(27	)		(19.9	)%
Investment Banking		125			131			(6	)		(4.6	)%
Total		782			907			(125	)		(13.8	)%
Revenue per Client Service Professional
Financial Advisory	$	184		$	175		$	9			5.1	%
Corporate Finance Consulting	$	237		$	223		$	14			6.3	%
Investment Banking	$	322		$	229		$	93			40.6	%
Total	$	213		$	189		$	24			12.7	%

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Results of Operations by Segment – Continued

	SixMonthsEnded
	June30,			June30,			Unit			Percent
	2010			2009			Change			Change
Utilization(1)
Financial Advisory		64.6	%		64.8	%		(0.2	)%		(0.3	)%
Corporate Finance Consulting		57.5	%		57.9	%		(0.4	)%		(0.7	)%
Rate-Per-Hour(2)
Financial Advisory	$	341		$	316		$	25			7.9	%
Corporate Finance Consulting	$	452		$	410		$	42			10.2	%
Revenues (excluding reimbursables)
Financial Advisory	$	108,116		$	118,797		$	(10,681	)		(9.0	)%
Corporate Finance Consulting		28,255			29,594			(1,339	)		(4.5	)%
Investment Banking		41,535			30,927			10,608			34.3	%
Total	$	177,906		$	179,318		$	(1,412	)		(0.8	)%
Average Number of Managing Directors
Financial Advisory		92			100			(8	)		(8.0	)%
Corporate Finance Consulting		31			30			1			3.3	%
Investment Banking		41			37			4			10.8	%
Total		164			167			(3	)		(1.8	)%
End of Period Managing Directors
Financial Advisory		94			96			(2	)		(2.1	)%
Corporate Finance Consulting		29			31			(2	)		(6.5	)%
Investment Banking		40			38			2			5.3	%
Total		163			165			(2	)		(1.2	)%
Revenue per Managing Director
Financial Advisory	$	1,175		$	1,188		$	(13	)		(1.1	)%
Corporate Finance Consulting	$	911		$	986		$	(75	)		(7.6	)%
Investment Banking	$	1,013		$	836		$	177			21.2	%
Total	$	1,085		$	1,074		$	11			1.0	%

(1) The utilization rate for any given period is calculated by dividing the number of hours incurred by client service professionals who worked on client assignments (including internal projects for the Company) during the period by the total available working hours for all of such client service professionals during the same period, assuming a 40 hour work week, less paid holidays and vacation days. Financial Advisory utilization excludes approximately 60 client service professionals associated with Rash & Associates, L.P., a wholly-owned subsidiary, due to the nature of the work performed.

(2) Average billing rate-per-hour is calculated by dividing applicable revenues for the period by the number of hours worked on client assignments (including internal projects for the Company) during the same period. Financial Advisory revenues used to calculate rate-per-hour exclude approximately $3,381 and $4,322 of revenues associated with Rash in the six months ended June 30, 2010 and 2009, respectively.

For segment reporting purposes, management uses certain estimates and assumptions to allocate revenues and expenses. Revenues and expenses attributable to reportable segments are generally based on which segment and product line a client service professional is a dedicated member. As a result, revenues recognized that relate to the cross utilization of client service professionals across reportable segments occur each period depending on the expertise required for each engagement. In particular, the Financial Advisory segment (primarily Valuation Advisory services) recognized revenues of $4,192 and $6,567 from the cross utilization of its client service professionals on engagements from the Corporate Finance Consulting segment (primarily Portfolio Valuation services) in the six months ended June 30, 2010 and 2009, respectively.

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Financial Advisory

Revenues

Revenues from the Financial Advisory segment decreased $10,681 or 9.0% to $108,116 for the six months ended June 30, 2010, compared to $118,797 for the six months ended June 30, 2009. The overall decline resulted from a decrease in revenues from each business unit, as summarized in the following table:

	Six Months Ended
	June 30,		June 30,		Dollar			Percent
	2010		2009		Change			Change
Financial Advisory
Valuation Advisory	$	67,849	$	74,142	$	(6,293	)		(8.5	)%
Tax Services		21,536		22,850		(1,314	)		(5.8	)%
Dispute & Legal Management Consulting(1)		18,731		21,805		(3,074	)		(14.1	)%
	$	108,116	$	118,797	$	(10,681	)		(9.0	)%

(1) Includes $547 of revenue from our acquisition of Cole Valuation Partners Limited effective June 15, 2010.

Our Financial Advisory segment was impacted by lower revenues in each business unit. Valuation Advisory was impacted by a reduction of goodwill impairment testing due to the improvement in the overall economic environment, as the corresponding prior year period benefited from a significant volume of goodwill impairment testing as a result of the fallout from the financial crisis. The decrease in revenues from goodwill impairment testing was partially offset by an increase in revenues from purchase price allocations and a higher volume of real estate valuation work.

The decrease in revenues from Tax Services primarily resulted from the departure of staff during the first half of 2010 associated with World Tax Service US, LLC (which we acquired in July 2008) and a related practice, partially offset by an increase in revenues from property tax contingent fees and transfer pricing activity.

Dispute & Legal Management Consulting (and to a lesser extent certain business units in our Corporate Finance Consulting segment) was impacted by the winding down in the first half of 2010 of an engagement to serve as a financial advisor to the court appointed examiner of a large financial services company under bankruptcy protection. Our results for the six months ended June 30, 2010 include approximately $8,200 of revenue from this assignment, primarily recognized in the Financial Advisory and Corporate Finance Consulting segments, compared to approximately $10,200 of revenue recognized in the corresponding prior year period.

Segment Operating Income

Financial Advisory segment operating income decreased $4,701 or 22.7% to $15,987 for the six months ended June 30, 2010, compared to $20,688 for the six months ended June 30, 2009. Segment operating income margin, defined as segment operating income expressed as a percentage of segment revenues, was 14.8% for the six months ended June 30, 2010, compared to 17.4% for the six months ended June 30, 2009. Despite a decrease in expenses, segment operating income and margin decreased as a result of lower revenues which led to a corresponding increase in direct client service costs as a percentage of revenues.

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Corporate Finance Consulting

Revenues

Revenues from the Corporate Finance Consulting segment decreased $1,339 or 4.5% to $28,255 for the six months ended June 30, 2010, compared to $29,594 for the six months ended June 30, 2009. Lower revenues from Portfolio Valuation, Financial Engineering and Strategic Value Advisory were partially offset by higher revenues from Due Diligence, as summarized in the following table:

	Six Months Ended
	June 30,		June 30,		Dollar			Percent
	2010		2009		Change			Change
Corporate Finance Consulting
Portfolio Valuation	$	10,124	$	10,633	$	(509	)		(4.8	)%
Financial Engineering		7,481		9,307		(1,826	)		(19.6	)%
Strategic Value Advisory		6,041		6,208		(167	)		(2.7	)%
Due Diligence		4,609		3,446		1,163			33.7	%
	$	28,255	$	29,594	$	(1,339	)		(4.5	)%

Our Corporate Finance Consulting segment was impacted by lower revenues from Portfolio Valuation, Financial Engineering and Strategic Value Advisory. Financial Engineering and Strategic Value Advisory were primarily impacted by lower revenues from an engagement to serve as a financial advisor to the court appointed examiner of a large financial services company under bankruptcy protection (as described in Financial Advisory above). Our Due Diligence business, however, grew sequentially and as compared to results from the corresponding prior year period from an increase in M&A related activity.

Segment Operating Income

Operating income from the Corporate Finance Consulting segment decreased $2,271 or 35.3% to $4,159 for the six months ended June 30, 2010, compared to $6,430 for the six months ended June 30, 2009. Segment operating income margin was 14.7% for the six months ended June 30, 2010, compared to 21.7% for the six months ended June 30, 2009. The decrease in segment operating income and margin primarily resulted from lower revenues and an increase in direct client service costs as a percentage of revenues, principally from higher equity-compensation expense from incremental grants of Ongoing RSAs.

Investment Banking

Revenues

Revenues from the Investment Banking segment increased $10,608 or 34.3% to $41,535 for the six months ended June 30, 2010, compared to $30,927 for the six months ended June 30, 2009, as summarized in the following table:

	Six Months Ended
	June 30,		June 30,		Dollar		Percent
	2010		2009		Change		Change
Investment Banking
Global Restructuring Advisory	$	21,845	$	14,192	$	7,653		53.9	%
Transaction Opinions		12,864		12,281		583		4.7	%
M&A Advisory		6,826		4,454		2,372		53.3	%
	$	41,535	$	30,927	$	10,608		34.3	%

Global Restructuring Advisory benefited from success fees related to our domestic and international restructuring services. Revenues from M&A Advisory and Transaction Opinions increased as a result of a higher level of transactional activity.

Segment Operating Income

Operating income from the Investment Banking segment increased $5,276 or 109.2% to $10,107 for the six months ended June 30, 2010, compared to $4,831 for the six months ended June 30, 2009. Operating income margin was 24.3% for the six months ended June 30, 2010, compared to 15.6% for the six months ended June 30, 2009. The increase in segment operating income and margin resulted from higher revenues driven in part by additional success fees.

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Liquidity and Capital Resources

Our primary sources of liquidity are our existing cash balances and availability under our revolving credit facility. Our historical cash flows are primarily related to the timing of (i) cash receipt of revenues, (ii) payment of base compensation, benefits and operating expenses, (iii) the timing of payment of bonuses to employees, (iv) distributions and other payments to noncontrolling unitholders, (v) corporate tax payments by the Company, (vi) dividends to the extent declared by the board of directors, (vii) funding of our deferred compensation program, (viii) repurchases of Class A common stock, and (ix) cash consideration for acquisitions and acquisition-related expenses.

Cash and cash equivalents decreased by $28,080 to $79,231 at June 30, 2010, compared to $107,311 at December 31, 2009. The decrease in cash primarily resulted from $18,343 used in investing activities and $16,530 used in financing activities, partially offset by $9,162 provided by operating activities.

Operating Activities

During the six months ended June 30, 2010, cash of $9,162 was provided by operating activities, compared to $2,302 provided in the corresponding prior year period. The increase of amounts used in operating activities primarily resulted from (i) an increase in amounts provided by accounts receivable, (ii) a decrease in amounts used by unbilled services, and (iii) lower cash bonus payment made in 2010 with respect to the 2009 bonus year, as compared to cash bonus payments made in 2009 with respect to the 2008 bonus year, partially offset by lower bonus accruals in the current year, as compared to the prior year. These benefits were partially offset primarily from an increase in amounts used by accounts payable and accrued expenses.

Investing Activities

During the six months ended June 30, 2010, cash of $18,343 was used in investing activities, compared to $9,556 used in the corresponding prior year period. Investing activities during the current period included (i) purchases of property and equipment to support our business, (ii) cash consideration for our acquisition of Cole Valuation Partners Limited and payments of earn-outs for acquisitions which primarily consisted of an earn-out payment to the sellers of Financial and IP Analysis, Inc. (d/b/a The Lumin Expert Group), and (iii) purchases of investments related to the Company’s deferred compensation plan.

Financing Activities

During the six months ended June 30, 2010, cash of $16,530 was used in financing activities, compared to $16,074 used in the prior year period. Significant financing activities are summarized as follows:

· Repurchases of Class A common stock – Repurchases of Class A common stock includes shares repurchased pursuant to a publicly announced repurchase program as well as shares of Class A common stock withheld to cover payroll tax withholdings related to the lapse of restrictions on Ongoing RSAs.

· Increase in restricted cash – The increase in restricted cash related to amounts placed in an escrow account in conjunction with our acquisition of Cole Valuation Partners Limited.

· Dividends – Cash dividends of $3,141 reflects the payment of quarterly cash dividends of $0.06 per share of our Class A common stock to holders of record as of March 16, 2010 and May 18, 2010.

· Distributions and other payments to noncontrolling unitholders – Distributions and other payments to noncontrolling unitholders are summarized as follows:

	Six Months Ended
	June 30,		June 30,
	2010		2009
Distributions for taxes	$	708	$	11,714
Other distributions		1,427		656
Payments pursuant to the Tax Receivable Agreement		-		-
	$	2,135	$	12,370

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Distributions for taxes

As a limited liability company, D&P Acquisitions does not incur significant federal or state and local taxes, as these taxes are primarily the obligations of the members of D&P Acquisitions. As authorized by the Third Amended and Restated LLC Agreement of D&P Acquisitions, D&P Acquisitions is required to distribute cash, generally, on a pro rata basis, to its members to the extent necessary to provide funds to pay the members' tax liabilities, if any, with respect to the earnings of D&P Acquisitions. The tax distribution rate has been set at 45% of each member’s allocable share of taxable income of D&P Acquisitions. D&P Acquisitions is only required to make such distributions if cash is available for such purposes as determined by the Company. The Company expects cash will be available to make these distributions. Upon completion of its tax returns with respect to the prior year, D&P Acquisitions may make true-up distributions to its members, if cash is available for such purposes, with respect to actual taxable income for the prior year. The decrease in tax distributions between periods primarily resulted from the timing of quarterly payments. The decrease in payments for the distributions for taxes between the six months ended June 30, 2010 and 2009 primarily resulted from the timing of payments. The distributions for each member’s estimated tax liability from taxable income of D&P acquisitions during the fourth quarter of 2008 was primarily made during the first quarter of 2009. The corresponding distribution to members for taxable income of D&P acquisitions during the fourth quarter of 2009 was primarily made during the quarter ended December 31, 2009.

Other distributions

During the six months ended June 30, 2010, the Company distributed $1,427 to holders of New Class A Units, other than Duff & Phelps Corporation. Concurrent with the payment of the dividend to shareholders of record, holders of New Class A Units received a $0.05 and $0.06 distribution per vested unit on March 16, 2010 and May 28, 2010, respectively. These amounts totaled $1,265 and will be treated as a reduction in basis of each member’s ownership interests. Pursuant to the terms of the Third Amended and Restated LLC Agreement of D&P Acquisitions, a corresponding amount per unvested unit was deposited into a segregated account and will be distributed once a year with respect to units that vested during that year. During the six months ended June 30, 2010, the Company distributed $162 to members whose units vested during 2009. Any amounts related to unvested units that forfeit are returned to the Company.

Payments pursuant to the Tax Receivable Agreement

As a result of the Company’s acquisition of New Class A Units of D&P Acquisitions, the Company expects to benefit from depreciation and other tax deductions reflecting D&P Acquisitions' tax basis for its assets. Those deductions will be allocated to the Company and will be taken into account in reporting the Company’s taxable income. Further, as a result of a federal income tax election made by D&P Acquisitions applicable to a portion of the Company’s acquisition of New Class A Units of D&P Acquisitions, the income tax basis of the assets of D&P Acquisitions underlying a portion of the units the Company has and will acquire (pursuant to the exchange agreement) will be adjusted based upon the amount that the Company has paid for that portion of its New Class A Units of D&P Acquisitions.

The Company has entered into a tax receivable agreement (“TRA”) with the existing unitholders of D&P Acquisitions (for the benefit of the existing unitholders of D&P Acquisitions) that provides for the payment by the Company to the unitholders of D&P Acquisitions of 85% of the amount of cash savings, if any, in U.S. federal, state and local income tax that the Company realizes (i) from the tax basis in its proportionate share of D&P Acquisitions' goodwill and similar intangible assets that the Company receives as a result of the exchanges and (ii) from the federal income tax election referred to above. D&P Acquisitions expects to make future payments under the TRA to the extent cash is available for such purposes.

As of June 30, 2010, the Company recorded a liability of $105,685, representing the payments due to D&P Acquisitions’ unitholders under the TRA (see current and non-current portion of “Due to noncontrolling unitholders” on the Company’s Condensed Consolidated Balance Sheets).

Within the next 12 month period, the Company expects to pay $4,303 of the total amount. The basis for determining the current portion of the payments due to D&P Acquisitions’ unitholders under the TRA is the expected amount of payments to be made within the next 12 months. The long-term portion of the payments due to D&P Acquisitions’ unitholders under the tax receivable agreement is the remainder. Payments are anticipated to be made annually over 15 years, commencing from the date of each event that gives rise to the TRA benefits, beginning with the date of the closing of the IPO on October 3, 2007. The payments are made in accordance with the terms of the TRA. The timing of the payments is subject to certain contingencies including Duff & Phelps Corporation having sufficient taxable income to utilize all of the tax benefits defined in the TRA.

To determine the current amount of the payments due to D&P Acquisitions’ unitholders under the TRA, the Company estimated the amount of taxable income that Duff & Phelps Corporation has generated over the previous fiscal year. Next, the Company estimated the amount of the specified TRA deductions at year end. This was used as a basis for determining the amount of tax reduction that generates a TRA obligation. In turn, this was used to calculate the estimated payments due under the TRA that the Company expects to pay in the next 12 months. These calculations are performed pursuant to the terms of the TRA.

52

Credit Facility

On July 15, 2009, Duff & Phelps, LLC entered into a credit agreement with Bank of America, N.A., as administrative agent and the lenders from time to time party thereto ("Credit Agreement"), providing for a $30,000 senior secured revolving credit facility (“Credit Facility”), including a $10,000 sub-limit for the issuance of letters of credit. The proceeds of the facility are permitted to be used for working capital, permitted acquisitions and general corporate purposes. The maturity date is July 15, 2012 and amounts borrowed may be voluntarily prepaid at any time without penalty or premium, subject to customary breakage costs.

There were no amounts outstanding under the Credit Facility at June 30, 2010 or through the filing date of this Quarterly Report on Form 10-Q. As of June 30, 2010, the Company had $4,472 of outstanding letters of credit of which $4,085 were issued against the Credit Facility. There was $387 of cash deposited into a restricted account to serve as deposits to secure the remaining letters of credit. These letters of credit were issued in connection with real estate leases.

Loans under the Credit Facility will, at the Company's option, bear interest on the principal amount outstanding at either (a) a rate equal to LIBOR, plus an applicable margin or (b) a base rate, plus an applicable margin. The applicable margin rate will be based on the Company's most recent consolidated leverage ratio and ranges from 1.75% to 2.50% per annum depending on the Company's consolidated leverage ratio. In addition, the Company is required to pay an unused commitment fee on the actual daily amount of the unutilized portion of the commitments of the lenders at a rate ranging from 0.25% to 0.50% per annum, based on the Company's most recent consolidated leverage ratio. Based on the Company’s consolidated leverage ratio at June 30, 2010, the Company qualified for the 1.75% applicable margin and 0.25% unused commitment fee.

The Credit Agreement contains customary representations and warranties and customary affirmative and negative covenants, including, among others, limitations on (a) the incurrence of liens, (b) the incurrence of indebtedness, (c) the ability to make dividends and distributions, as well as redeem and repurchase equity interests, and (d) acquisitions, mergers, consolidations and sales of assets. In addition, the Credit Agreement contains financial covenants that do not permit (a) a total leverage ratio of greater than 2.75 to 1.00 until the quarter ending September 30, 2010, and 2.50 to 1.00 thereafter and (b) a consolidated fixed charge coverage ratio of less than 2.00 to 1.00. The financial covenants are tested on the last day of each fiscal quarter based on the last four fiscal quarter periods. Management believes that the Company was in compliance with all of its covenants as of June 30, 2010. The Credit Agreement permits dividend payments or other distributions in the Company’s common stock or other equity interests subject to certain limitations.

The obligation of the Company to pay amounts outstanding under the Credit Facility may be accelerated upon the occurrence of an "Event of Default" as defined in the Credit Agreement. The Company's obligations under the Credit Agreement are guaranteed by D&P Acquisitions, and certain domestic subsidiaries of the Company (collectively, the "Guarantors"). The Credit Agreement is secured by a lien on substantially all of the personal property of the Company and each of the Guarantors.

Future Needs

Our primary financing need has been to fund our growth. Our growth strategy includes hiring additional revenue-generating client service professionals and expanding our service offerings through existing client service professionals, new hires or acquisitions of new businesses. We intend to fund such growth over the next twelve months with cash on-hand, funds generated from operations and borrowings under our revolving credit agreement. We believe these funds will be adequate to fund future growth.

53

Recent Accounting Pronouncements

In October 2009, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2009-13, Multiple-Deliverable Revenue Arrangements. ASU 2009-13 supersedes certain guidance in FASB Accounting Standards Codification (“ASC”) 605-25, Revenue Recognition – Multiple-Element Arrangements and requires an entity to allocate arrangement consideration at the inception of an arrangement to all of its deliverables based on their relative selling prices (the relative-selling-price method). ASU 2009-13 eliminates the use of the residual method of allocation in which the undelivered element is measured at its estimated selling price and the delivered element is measured as the residual of the arrangement consideration, and requires the relative-selling-price method in all circumstances in which an entity recognizes revenue for an arrangement with multiple deliverable subject to ASU 2009-13. ASU 2009-13 must be adopted no later than the beginning of the first fiscal year beginning on or after June 15, 2010, with early adoption permitted through either prospective application for revenue arrangements entered into, or materially modified, after the effective date or through retrospective application to all revenue arrangements for all periods presented. We are currently evaluating the impact that the adoption of ASU 2009-13 will have on our consolidated financial statements.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Market risks at June 30, 2010 have not changed significantly from those discussed in Item 7A of our Annual Report on Form 10-K for the year ended December 31, 2009.

Item 4. Controls and Procedures.

Disclosure Controls and Procedures

Our management, including our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures pursuant to Rule 13a-15 under the Exchange Act as of the end of the period covered by this report. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of the period covered by this quarterly report, our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) are effective, in all material respects, to ensure that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

The effectiveness of our disclosure controls and procedures and our internal control over financial reporting is subject to various inherent limitations, including cost limitations, judgments used in decision making, assumptions about the likelihood of future events, the soundness of our systems, the possibility of human error, and the risk of fraud. Moreover, projections of any evaluation of effectiveness of future periods are subject to the risk that controls may become inadequate because of changes in conditions and the risk that the degree of compliance with policies or procedures may deteriorate over time. Because of these limitations, there can be no assurance that any system of disclosure controls and procedures or internal control over financial reporting will be successful in preventing all errors or fraud or in making all material information known in a timely manner to the appropriate levels of management.

Changes in Internal Controls

No change in our internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) occurred during our most recent fiscal quarter that has materially affected, or is likely to materially affect, our internal control over financial reporting.

54

PART II

OTHER INFORMATION

Item 1. Legal Proceedings.

From time to time, we are involved in legal proceedings and litigation arising in the ordinary course of business. As of the date of this filing, we are not a party to or threatened with any litigation or other legal proceeding that, in our opinion, could have a material adverse effect on our business, operating results or financial condition.

Item 1A. Risk Factors.

There have been no material changes in the Company’s risk factors since those published in the Company’s Annual Report on Form 10-K for the year ended December 31, 2009.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

Issuer Purchases of Equity Securities

The following table summarizes repurchases of shares of the Company’s Class A common stock during the quarter ended June 30, 2010:

							Approximate
					Total		Dollar
					Numberof		Valueof
					Shares		Sharesthat
	Total				Purchasedas		MayYetBe
	Numberof		Average		PartofPublicly		Purchased
	Shares		PricePaid		Announced		Underthe
ClassACommonStock	Purchased		PerShare		Program		Program
April 1 through April 30, 2010		10	$	16.36		-	$	50,000
May 1 through May 31, 2010		296		14.69		247		46,370
June 1 through June 30, 2010		137		12.18		137		44,699
Total		443	$	13.95		384

On April 29, 2010, the Company announced that its Board of Directors had approved a stock repurchase program, authorizing the Company to repurchase in the aggregate up to $50,000 of its outstanding common stock. Purchases by the Company under this program were made from time to time at prevailing market prices in open market purchases. The purchases were funded from existing cash balances. Repurchased shares were retired and recorded as a reduction to additional paid-in capital. This program does not obligate the Company to acquire any particular amount of common stock. The timing, frequency and amount of repurchase activity will depend on a variety of factors such as levels of cash generation from operations, cash requirements for investment in the Company’s business, current stock price, market conditions, compliance with financial covenants pursuant to our Credit Agreement, and other factors. The share repurchase program may be suspended, modified or discontinued at any time and has no set expiration date.

In addition, the Company withheld shares of our Class A common stock from holders of restricted stock awards to satisfy the holders’ tax liabilities in connection with the lapse of restrictions on such shares. These shares were not part of a publicly announced repurchase program and were retired upon purchase.

Subsequent to June 30, 2010 through the day prior to this filing, the Company repurchased an additional 30 shares of Class A common stock at an average price of $12.56 per share. All of these additional shares were purchased as part of our publicly announced program. The approximate dollar value of shares that may yet be purchased under this program totaled $44,322 as of the day prior to this filing.

55

Exchange of New Class A Units to Shares of Class A Common Stock

In connection with the closing of the IPO, we entered into an exchange agreement, dated as of October 3, 2007 (as amended, the “Exchange Agreement”), by and among us, D&P Acquisitions, and certain unitholders of D&P Acquisitions, through which we may issue shares of Class A common stock upon the exchange of the New Class A Units. Pursuant to the Exchange Agreement, in connection with any such exchange, a corresponding number of shares of our Class B common stock will be cancelled. Subject to the terms and notice requirements as set forth in an amendment to the Exchange Agreement, exchanges are scheduled to occur on March 5th, May 15th, August 15th and November 15th of each year.

In May 2010, 21 New Class A Units were exchanged for 21 shares of Class A common stock and 21 shares of Class B common stock were cancelled.  We filed a registration statement in order to permit the resale of these shares from time to time, subject to certain blackouts and other restrictions.  We received no other consideration in connection with these exchanges.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. (Removed and Reserved).

Item 5. Other Information.

None.

Item 6. Exhibits.

Exhibit
Number	Description
31.1	Certification of the Chief Executive Officer, pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of the Chief Financial Officer, pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of the Chief Executive Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certification of the Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

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SIGNATURES

     Pursuant to the requirements 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.

	DUFF & PHELPS CORPORATION
	(Registrant)
Date:  July 29, 2010	/s/ Jacob L. Silverman
	JACOB L. SILVERMAN
	Chief Financial Officer

57

EX-31.1

EXHIBIT 31.1

Certification

Pursuant to Section 302

of the Sarbanes-Oxley Act of 2002

I, Noah Gottdiener, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Duff & Phelps Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, 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;

c. evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s third quarter in the case of this quarterly report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:  July 29, 2010	/s/ Noah Gottdiener
	NOAH GOTTDIENER
	Chairman of the Board and
	Chief Executive Officer

EX-31.2

EXHIBIT 31.2

Certification

Pursuant to Section 302

of the Sarbanes-Oxley Act of 2002

I, Jacob Silverman, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Duff & Phelps Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, 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;

c. evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s third quarter in the case of this quarterly report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:  July 29, 2010	/s/ Jacob L. Silverman
	JACOB L. SILVERMAN
	Chief Financial Officer

EX-32.1

EXHIBIT32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES OXLEY ACT OF 2002

In connection with the Quarterly Report of Duff & Phelps Corporation, (the “Company”) on Form 10-Q for the quarter ended June 30, 2010 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Noah Gottdiener, Chairman and Chief Executive Officer of the Company, hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company for the periods presented therein.

Date:  July 29, 2010	/s/ Noah Gottdiener
	NOAH GOTTDIENER
	Chairman of the Board and
	Chief Executive Officer

EX-32.2

EXHIBIT32.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES OXLEY ACT OF 2002

In connection with the Quarterly Report of Duff & Phelps Corporation, (the “Company”) on Form 10-Q for the quarter ended June 30, 2010 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Jacob Silverman, Chief Financial Officer of the Company, hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company for the periods presented therein.

Date:  July 29, 2010	/s/ Jacob L. Silverman
	JACOB L. SILVERMAN
	Chief Financial Officer