15.	EMPLOYEE BENEFIT PLANS

The Company provides retirement and other post-retirement benefits to certain of its employees through defined benefit pension plans (the “pension plans”) and, until December 2016, in the U.S., a partially funded contributory medical post-retirement plan covering certain qualifying U.S. employees (the “medical plan” and together with the pension plans, the “post-retirement plans”). The Company also offers defined contribution plans to its employees. The post-retirement plans generally provide benefits to participants based on average levels of compensation. Expenses related to the Company’s employee benefit plans are included in “compensation and benefits” expense on the consolidated statements of operations.

Medical Plan—The medical plan was previously amended such that effective January 1, 2005 the plan limited post-retirement medical coverage to then former and current employees of the Company that were hired prior to January 1, 2005 and attained the age of 55 on or prior to December 31, 2005, and their dependents. Effective December 31, 2016, the Company ceased offering the medical plan.

In October 2016, the Company paid participants in the medical plan $2,936 in the aggregate to settle in full the Company’s obligations under the medical plan. The settlement of such obligations resulted in the recognition of a gain of $1,788 that is recorded as a reduction to compensation and benefits expense in the consolidated statements of operations for the year ended December 31, 2016.

Employer Contributions to Pension Plans—The Company’s funding policy for its U.S. and non-U.S. pension plans is to fund when required or when applicable upon an agreement with the plans’ trustees (the “Trustees”). Management also evaluates from time to time whether to make voluntary contributions to the plans.

The Company does not expect to make a contribution to the U.S. pension plan during the year ending December 31, 2018. The Company expects to contribute approximately $21,000 to the other non-U.S. pension plans during the year ending December 31, 2018.

The following table summarizes the changes in the benefit obligations, the fair value of the assets, the funded status and amounts recognized in the consolidated statements of financial condition for the post-retirement plans. The Company uses December 31 as the measurement date for its post-retirement plans.

	Pension Plans						Medical Plan
	2017			2016			2017		2016
Change in benefit obligation
Benefit obligation at beginning of year	$	718,821		$	694,187		$	-	$	4,750
Service cost		1,413			1,235					11
Interest cost		16,240			19,871					167
Actuarial (gain) loss		2,702			135,164					(1,639	)
Benefits paid		(44,589	)		(31,904	)				(3,289	)
Foreign currency translation and other adjustments		69,244			(99,732	)
Benefit obligation at end of year		763,831			718,821			-		-
Change in plan assets
Fair value of plan assets at beginning of year		646,119			656,084
Actual return on plan assets		43,624			119,287
Employer contributions		16,844			11,343					3,289
Benefits paid		(42,022	)		(29,384	)				(3,289	)
Foreign currency translation and other adjustments		63,716			(111,211	)
Fair value of plan assets at end of year		728,281			646,119			-		-
Funded (deficit) at end of year	$	(35,550	)	$	(72,702	)	$	-	$	-
Amounts recognized in the consolidated statements of financial condition at December 31, 2017 and 2016 consist of:
Prepaid pension asset (included in “other assets”)	$	16,189		$	822		$	-	$	-
Accrued benefit liability (included in “other liabilities”)		(51,739	)		(73,524	)
Net amount recognized	$	(35,550	)	$	(72,702	)	$	-	$	-
Amounts recognized in AOCI (excluding tax benefits of $35,154 and $33,864 at December 31, 2017 and 2016, respectively) consist of:
Actuarial net loss (gain)	$	184,135		$	192,855		$	-	$	-
Prior service cost		-			30
Net amount recognized	$	184,135		$	192,885		$	-	$	-

The following table summarizes the fair value of plan assets, the accumulated benefit obligation and the projected benefit obligation at December 31, 2017 and 2016:

	U.S. Pension Plans				Non-U.S. Pension Plans				Total
	As Of December 31,				As Of December 31,				As Of December 31,
	2017		2016		2017		2016		2017		2016
Fair value of plan assets	$	24,644	$	22,161	$	703,637	$	623,958	$	728,281	$	646,119
Accumulated benefit obligation	$	35,376	$	33,868	$	728,455	$	684,953	$	763,831	$	718,821
Projected benefit obligation	$	35,376	$	33,868	$	728,455	$	684,953	$	763,831	$	718,821

The following table summarizes the components of net periodic benefit cost (credit), the return on the Company’s post-retirement plan assets, benefits paid, contributions and other amounts recognized in AOCI for the years ended December 31, 2017, 2016 and 2015:

	Pension Plans									Medical Plan
	For The Year Ended									For The Year Ended
	December 31,									December 31,
	2017			2016			2015			2017		2016			2015
Components of Net Periodic Benefit Cost (Credit):
Service cost	$	1,413		$	1,235		$	1,530		$	-	$	11		$	27
Interest cost		16,240			19,871			24,600			-		167			179
Expected return on plan assets		(25,300	)		(27,337	)		(28,301	)		-		-			-
Amortization of:
Prior service cost		30			2,369			2,376			-		-			-
Net actuarial loss (gain)		10,141			3,888			5,440			-		(185	)		-
Settlement loss (gain)		807			-			-			-		(1,788	)		-
Net periodic benefit cost (credit)	$	3,331		$	26		$	5,645		$	-	$	(1,795	)	$	206


Actual return on plan assets	$	43,624		$	119,287		$	9,873
Employer contributions	$	16,844		$	11,343		$	39,301		$	-	$	3,289		$	276
Benefits paid	$	42,022		$	29,384		$	32,321		$	-	$	3,289		$	276
Other changes in plan assets and benefit obligations recognized in AOCI (excluding tax expense (benefit) of $(1,287), $(3,448) and $7,151 during the years ended December 31, 2017, 2016 and 2015, respectively):
Net actuarial (gain) loss	$	(17,357	)	$	51,626		$	(4,650	)	$	-	$	(1,638	)	$	(695	)
Reclassification of prior service (cost) credit to earnings		(30	)		(2,369	)		(2,376	)		-		-			-
Reclassification of actuarial gain (loss) to earnings		(10,141	)		(3,888	)		(5,440	)		-		1,973			-
Currency translation and other adjustments		18,778			(20,309	)		(11,582	)		-		-			-
Total recognized in AOCI	$	(8,750	)	$	25,060		$	(24,048	)	$	-	$	335		$	(695	)
Net amount recognized in total periodic benefit cost and AOCI	$	(5,419	)	$	25,086		$	(18,403	)	$	-	$	(1,460	)	$	(489	)

The amounts in AOCI on the consolidated statement of financial condition as of December 31, 2017 that are expected to be recognized as components of net periodic benefit cost (credit) for the year ending December 31, 2018 are as follows:

Pension

Plans

Net actuarial loss

5,072

The assumptions used to develop actuarial present value of the projected benefit obligation and net periodic pension cost as of or for the years ended December 31, 2017, 2016 and 2015 are set forth below:

	Pension Plans									Medical Plan
	December 31,									December 31,
	2017			2016			2015			2017		2016			2015
Weighted average assumptions used to determine benefit obligations:
Discount rate		2.3	%		2.5	%		3.5	%		-		-			3.9	%
Weighted average assumptions used to determine net periodic benefit cost:
Discount rate		2.2	%		1.9	%		2.6	%		-		3.9	%		3.7	%
Expected long-term rate of return on plan assets		3.8	%		4.6	%		4.3	%		-		-			-
Healthcare cost trend rates used to determine net periodic benefit cost:
Initial											-		6.5	%		7.0	%
Ultimate											-		5.0	%		5.0	%
Year ultimate trend rate achieved											-	2019			2019

Generally, the Company determined the discount rates for its defined benefit plans by utilizing indices for long-term, high-quality bonds and ensuring that the discount rate does not exceed the yield reported for those indices after adjustment for the duration of the plans’ liabilities.

In selecting the expected long-term rate of return on plan assets, the Company considered the average rate of earnings expected on the funds invested or to be invested to provide for the benefits of the plan, giving consideration to expected returns on different asset classes held by the plans in light of prevailing economic conditions as well as historical returns. This basis is consistent for all years presented.

Expected Benefit Payments—The following table summarizes the expected benefit payments for the Company’s pension plans for each of the next five fiscal years and in the aggregate for the five fiscal years thereafter:

	Pension
	Plans
2018	$	24,631
2019		25,347
2020		25,351
2021		26,981
2022		29,287
2023-2027		153,490

Plan Assets—The following tables present the categorization of our pension plans’ assets as of December 31, 2017 and 2016, measured at fair value, into a fair value hierarchy and investments measured at NAV or its equivalent as a practical expedient in accordance with fair value measurement disclosure requirements:

	As of December 31, 2017
	Level 1		Level 2		Level 3		NAV (a)		Total
Assets:
Cash	$	11,544	$	-	$	-	$	-	$	11,544
Debt		73,728		-		-		-		73,728
Equities		36,854		-		-		-		36,854
Funds:
Alternative investments		-		-		-		25,938		25,938
Debt		11,002		-		-		363,915		374,917
Equity		192,875		3,746		-		8,015		204,636
Derivative		-		664		-		-		664
Total	$	326,003	$	4,410	$	-	$	397,868	$	728,281

	As of December 31, 2016
	Level 1		Level 2		Level 3		NAV (a)		Total
Assets:
Cash	$	23,341	$	-	$	-	$	-	$	23,341
Debt		63,431		-		-		-		63,431
Equities		29,287		-		-		-		29,287
Funds:
Alternative investments		1,216		-		-		23,062		24,278
Debt		10,494		-		-		320,560		331,054
Equity		167,981		-		-		6,129		174,110
Derivative		-		618		-		-		618
Total	$	295,750	$	618	$	-	$	349,751	$	646,119

(a)	Represents certain investments measured at NAV or its equivalent as a practical expedient in determining fair value. In accordance with current accounting guidance, these investments have not been classified in the fair value hierarchy.

Included in equity funds are $102,455 and $97,933 as of December 31, 2017 and 2016, respectively, that are invested in funds managed by LAM.

Consistent with the plans’ investment strategies, at December 31, 2017 and 2016, the Company’s U.S. pension plan had 55% and 53%, respectively, of the plans’ assets invested in equity funds in Level 1 and measured at NAV or its equivalent as a practical expedient and 45% and 47%, respectively, invested in Level 1 debt funds. The Company’s non-U.S. pension plans at December 31, 2017 and 2016 had 32% and 31%, respectively, of the plans’ assets invested in equities and equity funds that are primarily Level 1 assets; 62% and 62%, respectively, of the plans’ assets invested in debt and debt funds that are Level 1 assets and measured at NAV or its equivalent as a practical expedient, and 6% and 7%, respectively, of the plans’ assets invested in cash, which is a Level 1 asset, or in alternative investment funds that are primarily measured at NAV.

Investment Policies and Strategies—The primary investment goal is to ensure that the pension plans remain well funded, taking account of the likely future risks to investment returns and contributions. As a result, a portfolio of assets is maintained with appropriate liquidity and diversification that can be expected to generate long-term future returns that minimize the long-term costs of the pension plans without exposing the plans to an unacceptable risk of under-funding. The Company’s likely future ability to pay such contributions as are required to maintain the funded status of the plans over a reasonable time period is considered when determining the level of risk that is appropriate. The fair value of plan investments classified as Level 1 assets are based on market quotes. The fair value of plan investments measured at NAV or its equivalent as a practical expedient is determined based on information provided by external fund administrators and such investments are redeemable in the near term.

Defined Contribution Plans—Pursuant to certain matching contributions, the Company contributes to employer sponsored defined contribution plans. Such contributions amounted to $15,065, $14,454 and $12,493 for the years ended December 31, 2017, 2016 and 2015, respectively, which are included in “compensation and benefits” expense on the consolidated statements of operations.