4. Revenue Recognition

3 Months Ended

Mar. 31, 2018

Notes to Financial Statements

4. Revenue Recognition

On January 1, 2018, we adopted ASC Topic 606 by applying the modified retrospective method. Results for reporting periods beginning after January 1, 2018 are presented under Topic 606, while prior period amounts are not adjusted and continue to be reported under the accounting standards in effect for the prior period.

The adoption of ASC Topic 606 did not have an impact on the recognition of our primary sources of revenue, Principal transactions, Commissions and fees and Margin interest, marketing and distribution fees. Timing of recognition of substantially all of our remaining revenue was also not impacted, and we therefore did not record any cumulative effect adjustment to opening equity.

Disaggregation of Revenue

Our revenue consists of:

			Three months Ended March 31,
			2018		2017
Revenue Stream	Income Statement Classification		Total Revenue
Revenue from Principal transactions:			(in thousands)
Principal transactions		Principal transactions	$	572	$	109
Principal transactions attributed to assets acquired from StockCross		Principal transactions		2,369		—
Total revenue from Principal transactions			$	2,941	$	109
Revenue from Commissions and fees:
Commissions and fees		Commissions and fees	$	1,955	$	1,183
Commissions and fees attributed to assets acquired from StockCross		Commissions and fees		719		—
Total revenue from Commissions and fees			$	2,674	$	1,183
Revenue from Margin interest, marketing and distribution fees:
Margin interest, marketing and distribution fees		Margin interest, marketing and distribution fees	$	2,328	$	1,080
Margin interest, marketing and distribution fees attributed to assets acquired from StockCross		Margin interest, marketing and distribution fees		207		—
Total revenue from Margin interest, marketing and distribution fees		Margin interest, marketing and distribution fees	$	2,535	$	1,080
Total revenue from contracts with customers
Other revenue:
Advisory fees		Advisory fees	$	16	$	5
Interest and dividends		Interest and dividends		11		2
Total revenues		Total revenues	$	8,177	$	2,379

Principal transactions are also recorded on a trade-date basis and principally represent riskless principal transactions in which the Company, after receiving an order, buys or sells securities as principal and at the same time sells or buys the securities with a markup or markdown to complete the order.

Commission and fees, margin interest, marketing and distribution fees and related clearing expenses are recorded on a trade-date basis. Fees, consisting principally of revenue participation with the Company’s clearing brokers in distribution fees, and interest are recorded as earned.

Advisory fees are earned typically on a quarterly basis in accordance with the terms of the client agreements.

Interest is recorded on the accrual basis. Dividends are recorded as of the ex-dividend date.