Fair Values of Assets and Liabilities (Tables)

3 Months Ended

9 Months Ended

12 Months Ended

Dec. 31, 2011

Dec. 31, 2010

Dec. 31, 2011

Dec. 31, 2010

Mar. 31, 2011

Investments and Fair Values of Assets and Liabilities Disclosure [Abstract]

Fair values of financial assets and liabilities



	As of December 31, 2011
	Quoted prices in active markets (Level 1)			Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)		Total
Assets:
Cash equivalents⁽¹⁾:
Money market funds	$	749,342		$	—	$	—	$	749,342
Time deposits	—			45,150		—		45,150
Total cash equivalents	749,342			45,150		—		794,492
Investment securities:
Trading investments relating to long-term incentive compensation plans⁽²⁾	94,875			—		—		94,875
Trading proprietary fund products and other investments⁽³⁾	169,147			79,293		—		248,440
Equity method investments relating to long-term incentive compensation plans, proprietary fund products and other investments⁽⁴⁾⁽⁵⁾	14,689			46,203		11,060		71,952
Total current investments	278,711			125,496		11,060		415,267
Available-for-sale investment securities	2,090			9,234		12		11,336
Investments in partnerships, LLCs and other	812			5,107		28,240		34,159
Equity method investments in partnerships and LLCs⁽⁴⁾	1,289			—		150,302		151,591
Derivative assets:
Currency and market hedges	10,204			—		—		10,204
Other investments	—			—		121		121
	$	1,042,448		$	184,987	$	189,735	$	1,417,170
Liabilities:
Derivative liabilities:
Currency and market hedges	$	(1,402	)	$	—	$	—	$	(1,402	)



	As of March 31, 2011
	Quoted prices in active markets (Level 1)			Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)		Total
Assets:
Cash equivalents⁽¹⁾:
Money market funds	$	912,951		$	—	$	—	$	912,951
Time deposits	—			92,877		—		92,877
Total cash equivalents	912,951			92,877		—		1,005,828
Investment securities:
Trading investments relating to long-term incentive compensation plans⁽²⁾	120,107			—		—		120,107
Trading proprietary fund products and other investments⁽³⁾	90,123			102,562		11,378		204,063
Equity method investments relating to long-term incentive compensation plans, proprietary fund products and other investments⁽⁴⁾⁽⁵⁾	15,645			48,528		12,167		76,340
Total current investments	225,875			151,090		23,545		400,510
Available-for-sale investment securities	2,666			8,622		12		11,300
Investments in partnerships, LLCs and other	—			—		22,167		22,167
Equity method investments in partnerships and LLCs⁽⁴⁾	1,420			—		153,931		155,351
Derivative assets:
Currency and market hedges	1,169			—		—		1,169
Other investments	—			—		270		270
	$	1,144,081		$	252,589	$	199,925	$	1,596,595
Liabilities:
Derivative liabilities:
Currency and market hedges	$	(3,120	)	$	—	$	—	$	(3,120	)

(1)

Cash equivalents include highly liquid investments with original maturities of 90 days or less. Cash investments in actively traded money market funds are measured at NAV and are classified as Level 1. Cash investments in time deposits are measured at amortized cost, which approximates fair value because of the short time between the purchase of the instrument and its expected realization, and are classified as Level 2.


(2)	Primarily mutual funds where there is minimal market risk to the Company as any change in value is primarily offset by an adjustment to compensation expense and related deferred compensation liability.


(3)	Trading proprietary fund products and other investments primarily represent mutual funds that are invested approximately 53% and 47% in equity and debt securities as of December 31, 2011, respectively, and were invested approximately 60% and 40% in equity and debt securities as of March 31, 2011, respectively.


(4)	Substantially all of our equity method investments are investment companies which record their underlying investments at fair value. Fair value is measured using Legg Mason's share of the investee's underlying net income or loss, which is predominately representative of fair value adjustments in the investments held by the equity method investee.

(5)

Includes investments under the equity method (which approximates fair value) relating to long-term incentive compensation plans of $46,203 and $48,528 as of December 31, 2011, and March 31, 2011, respectively, and proprietary fund products and other investments of $25,749 and $27,812 as of December 31, 2011, and March 31, 2011, respectively, which are classified as Investment securities on the Consolidated Balance Sheets.

Summary of changes in financial assets measured at fair value using significant unobservable inputs (Level 3)



	Value as of September 30, 2011		Purchases		Sales			Settlements/ Other			Transfers		Realized and unrealized gains/(losses), net			Value as of December 31, 2011
Assets:
Trading proprietary fund products and other investments	$	179	$	—	$	(165	)	$	—		$	—	$	(14	)	$	—
Equity method investments in proprietary fund products	11,605		—		—			—			—		(545		)	11,060
Investments in partnerships, LLCs and other	28,469		—		—			(10		)	—		(219		)	28,240
Equity method investments in partnerships and LLCs	160,662		660		(1,869		)	(1,370		)	—		(7,781		)	150,302
Other investments	133		—		—			—			—		—			133
	$	201,048	$	660	$	(2,034	)	$	(1,380	)	$	—	$	(8,559	)	$	189,735



	Value as of September 30, 2010		Purchases, sales, issuances and settlements, net			Transfers		Realized and unrealized gains/(losses), net			Value as of December 31, 2010
Assets:
Trading proprietary fund products and other investments	$	18,063	$	(2,500	)	$	350	$	1,133		$	17,046
Equity method investments in proprietary fund products	11,889		—			—		463			12,352
Investments in partnerships, LLCs and other	23,050		(99		)	—		(1,742		)	21,209
Equity method investments in partnerships and LLCs	154,418		(437		)	—		4,583			158,564
Other investments	1,476		(4,254		)	—		2,875			97
	$	208,896	$	(7,290	)	$	350	$	7,312		$	209,268



	Value as of March 31, 2011		Purchases		Sales			Settlements/ Other			Transfers		Realized and unrealized gains/(losses), net			Value as of December 31, 2011
Assets:
Trading proprietary fund products and other investments	$	11,378	$	—	$	(11,906	)	$	—		$	—	$	528		$	—
Equity method investments in proprietary fund products	12,167		—		—			—			—		(1,107		)	11,060
Investments in partnerships, LLCs and other	22,167		6,932		—			(119		)	—		(740		)	28,240
Equity method investments in partnerships and LLCs	153,931		26,164		(5,162		)	(14,067		)	—		(10,564		)	150,302
Other investments	282		—		—			(159		)	—		10			133
	$	199,925	$	33,096	$	(17,068	)	$	(14,345	)	$	—	$	(11,873	)	$	189,735



	Value as of March 31, 2010		Purchases, sales, issuances and settlements, net			Transfers		Realized and unrealized gains/(losses), net			Value as of December 31, 2010
Assets:
Trading proprietary fund products and other investments	$	22,459	$	(7,500	)	$	350	$	1,737		$	17,046
Equity method investments in proprietary fund products	12,090		—			—		262			12,352
Investments in partnerships, LLCs and other	23,049		(102		)	—		(1,738		)	21,209
Equity method investments in partnerships and LLCs	98,968		40,084			—		19,512			158,564
Other investments	1,464		(4,254		)	—		2,887			97
	$	158,030	$	28,228		$	350	$	22,660		$	209,268

Fair value of investments determined using net asset value



Category of Investment	Investment Strategy	Fair Value Determined Using NAV			Unfunded Commitments		Remaining Term
Funds-of-hedge funds	Global, fixed income, macro, long/short equity, natural resources, systematic, emerging market, European hedge	$	55,570	⁽¹⁾	n/a		n/a
Hedge funds	Fixed income - developed market, event driven, fixed income - hedge, relative value arbitrage, European hedge	25,222		⁽²⁾	$	20,000	n/a
Private equity funds	Long/short equity	28,300		⁽²⁾	5,983		Up to 8 years
Private fund	Fixed income, residential and commercial mortgage-backed securities	73,455		^{(2) (3)}	n/a		7 years, subject to two one-year extensions
Other	Various	2,292		⁽²⁾	n/a		Various ⁽⁴⁾
Total		$	184,839		$	25,983

n/a-not applicable

(1) 68% monthly redemption; 32% quarterly redemption, of which 38% is subject to two-year lock-up.

(2) Liquidations are expected over the remaining term.

(3) Redemptions prohibited until November 2012.

(4) 4% remaining term of less than one year; 96% 20-year remaining term.

- Definition

Tabular disclosure of the fair value measurement of assets using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets) and gains or losses recognized in other comprehensive income, and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issuances, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs), by class of asset.

+ References+ Details

- Definition

Tabular disclosure of the fair value of investees that calculate net asset value per share (including by unit, membership interest, or other equity (ownership interest) unit measure) (alternative investments), whether measured at fair value on a recurring or nonrecurring basis, by major category of assets and liabilities (as defined), including, for example, (i) fair value measurements at the reporting date, (ii) the level within the fair value hierarchy in which the fair value measurements fall, (iii) a reconciliation of beginning and ending balances for those alternative investments that are measured at fair value using unobservable inputs (Level 3 - fair value hierarchy fair value measurement inputs), (iv) the inputs and valuation techniques used to measure fair value, (v) a discussion of changes to valuation techniques and inputs, if any, during the period, (vi) a description of the nature and risk associated with the alternative investments, and (vii) a discussion of the probability that any of the alternative investments are to be sold.

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- Definition

Tabular disclosure of the fair value measurement of assets and liabilities which includes [financial] instruments measured at fair value that are classified in stockholders' equity. Such assets and liabilities may be measured on a recurring or nonrecurring basis. The disclosures which may be required or desired include: (1) for assets and liabilities measured on a recurring basis, disclosure may include: (a) the fair value measurements at the reporting date; (b) the level within the fair value hierarchy in which the fair value measurements in their entirety fall, segregating fair value measurements using quoted prices in active markets for identical assets or liabilities (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3); (c) for fair value measurements using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (i) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets), and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (ii) purchases, sales, issuances, and settlements (net); (iii) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs); (d) the amount of the total gains or losses for the period in subparagraph (c) (i) above included in earnings (or changes in net assets) that are attributable to the change in unrealized gains or losses relating to those assets and liabilities still held at the reporting date and a description of where those unrealized gains or losses are reported in the statement of income (or activities); (e) the valuation technique(s) used to measure fair value and a discussion of changes in valuation techniques, if any, during the period and (2) for assets and liabilities that are measured at fair value on a nonrecurring basis (for example, impaired assets) disclosure may include, in addition to (a) above: (a) the reasons for the fair value measurements recorded; (b) the same as (b) above; (c) for fair value measurements using significant unobservable inputs (Level 3), a description of the inputs and the information used to develop the inputs; and (d) the valuation technique(s) used to measure fair value and a discussion of changes, if any, in the valuation technique(s) used to measure similar assets and/or liabilities in prior periods. Where the quoted price in an active market for the identical liability is not available, the Level 1 input is the quoted price of an identical liability when traded as an asset.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 820

-SubTopic 10

-Section 50

-Paragraph 3

-URI http://asc.fasb.org/extlink&oid=6925170&loc=d3e19279-110258

Reference 2: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 157

-Paragraph 32

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 3: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 157

-Paragraph 33

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 4: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 107

-Paragraph 10

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 5: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 820

-SubTopic 10

-Section 50

-Paragraph 5

-URI http://asc.fasb.org/extlink&oid=6925170&loc=d3e19296-110258

Reference 6: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 820

-SubTopic 10

-Section 50

-Paragraph 2

-URI http://asc.fasb.org/extlink&oid=6925170&loc=d3e19207-110258

Reference 7: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 157

-Paragraph 6

-Footnote 4

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 8: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 820

-SubTopic 10

-Section 50

-Paragraph 1

-URI http://asc.fasb.org/extlink&oid=6925170&loc=d3e19190-110258

+ Details