Basis of Presentation |
9 Months Ended |
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Sep. 30, 2024 | |
| Accounting Policies [Abstract] | |
| Basis of Presentation |
Basis of Presentation Nature of Operations
Ryan Specialty Holdings, Inc., (the “Company”) is a service provider of specialty products and solutions for insurance
brokers, agents, and carriers. These services encompass distribution, underwriting, product development, administration,
and risk management by acting as a wholesale broker and a managing underwriter or a program administrator with
delegated authority from insurance carriers. The Company’s offerings cover a wide variety of sectors including
commercial, industrial, institutional, governmental, and personal through one operating segment, Ryan Specialty. With the
exception of the Company’s equity method investment, the Company does not take on any underwriting risk.
The Company is headquartered in Chicago, Illinois, and has operations in the United States, Canada, the United Kingdom,
Europe, and Singapore. The Company’s Class A common stock is traded on the New York Stock Exchange under the
ticker symbol “RYAN”.
Organization
Ryan Specialty Holdings, Inc., was formed as a Delaware corporation on March 5, 2021, for the purpose of completing an
IPO and to carry on the business of the LLC. New Ryan Specialty, LLC, or New LLC, was formed as a Delaware limited
liability company on April 20, 2021, for the purpose of becoming, subsequent to our IPO, an intermediate holding
company between Ryan Specialty Holdings, Inc., and the LLC. The Company is the sole managing member of New LLC.
New LLC is a holding company with its sole material asset being a controlling equity interest in the LLC. The Company
operates and controls the business and affairs of the LLC through New LLC and, through the LLC, conducts its business.
Accordingly, the Company consolidates the financial results of New LLC, and therefore the LLC, and reports the non-
controlling interests of New LLC’s Common Units on its consolidated financial statements. As the LLC is substantively
the same as New LLC, for the purpose of this document, we will refer to both New LLC and the LLC as the “LLC”. As of
September 30, 2024, the Company owned 47.8% of the outstanding LLC Common Units.
Basis of Presentation
The accompanying unaudited consolidated interim financial statements and notes thereto have been prepared in accordance
with U.S. GAAP. Certain information and disclosures normally included in the financial statements prepared in accordance
with U.S. GAAP have been omitted pursuant to the rules and regulations of the SEC for interim financial information.
These consolidated interim financial statements should be read in conjunction with the audited consolidated financial
statements and notes thereto included in the Company’s Annual Report on Form 10-K filed with the SEC on February 28,
2024. Interim results are not necessarily indicative of results for the full fiscal year due to seasonality and other factors.
In the opinion of management, the unaudited consolidated interim financial statements include all normal recurring
adjustments necessary to present fairly the Company’s consolidated financial position, results of operations, and cash flows
for all periods presented. Certain prior period amounts in the Consolidated Statements of Cash Flows have been reclassified
to conform to the current year presentation.
Principles of Consolidation
The unaudited consolidated interim financial statements include the accounts of the Company and its subsidiaries that it
controls due to ownership of a majority voting interest or pursuant to variable interest entity (“VIE”) accounting. All
intercompany transactions and balances have been eliminated in consolidation.
The Company, through its intermediate holding company New LLC, owns a minority economic interest in, and operates
and controls the businesses and affairs of, the LLC. The LLC is a VIE of the Company and the Company is the primary
beneficiary of the LLC as the Company has both the power to direct the activities that most significantly impact the LLC’s
economic performance and has the obligation to absorb losses of, and receive benefits from, the LLC, which could be
significant to the Company. Accordingly, the Company has prepared these consolidated financial statements in accordance
with Accounting Standards Codification 810, Consolidation (“ASC 810”). ASC 810 requires that if an entity is the primary
beneficiary of a VIE, the assets, liabilities, and results of operations of the VIE should be included in the consolidated
financial statements of such entity. The Company’s relationship with the LLC results in no recourse to the general credit of
the Company and the Company has no contractual requirement to provide financial support to the LLC. The Company
shares in the income and losses of the LLC in direct proportion to the Company’s ownership percentage.
Use of Estimates
The preparation of the unaudited consolidated interim financial statements and notes thereto requires management to make
estimates, judgments, and assumptions that affect the amounts reported in the unaudited consolidated interim financial
statements and in the notes thereto. Such estimates and assumptions could change in the future as circumstances change or
more information becomes available, which could affect the amounts reported and disclosed herein.
Significant Accounting Policies
There have been no material changes in the Company’s significant accounting policies from those that were disclosed for
the year ended December 31, 2023, in the Company’s Annual Report on Form 10-K filed with the SEC on February 28,
2024.
Recently Issued Accounting Pronouncements
Recently Issued Accounting Pronouncements Not Yet Adopted
In November 2023, the FASB issued ASU 2023-07 Segment Reporting (Topic 280) — Improvements to Reportable
Segment Disclosures, which requires disclosure of incremental segment information on an annual and interim basis. This
ASU is effective for annual periods beginning after December 15, 2023, and interim periods within fiscal years beginning
after December 15, 2024, with early adoption permitted. The amendments in this ASU should be applied retrospectively to
all prior periods presented in the financial statements. The Company is currently evaluating the impact of adopting this
ASU on its consolidated financial statements and disclosures.
In December 2023, the FASB issued ASU 2023-09 Income Taxes (Topic 740) — Improvements to Income Tax Disclosures,
which includes amendments that further enhance income tax disclosures, primarily through standardization and
disaggregation of rate reconciliation categories and income taxes paid by jurisdiction. This ASU is effective for annual
periods beginning after December 15, 2024, with early adoption permitted. The Company is currently evaluating the
impact of adopting this ASU on its consolidated financial statements and disclosures.
New Accounting Pronouncements Recently Adopted
In March 2024, the FASB issued ASU 2024-01 Compensation — Stock Compensation (Topic 718) — Scope Application of
Profits Interest and Similar Awards, which provides illustrative examples to demonstrate how an entity should apply the
scope guidance in paragraph 718-10-15-3 to determine whether profits interests and similar awards should be accounted for
in accordance with Topic 718. This ASU is effective for public companies for fiscal years beginning after December 15,
2024, but early adoption is permitted. The Company adopted this standard retrospectively on January 1, 2024, with no
material impact to the consolidated financial statements or disclosures.
In March 2024, the FASB issued ASU 2024-02 Codification Improvements — Amendments to Remove References to the
Concept Statements, which removes references to various FASB Concepts Statements in order to simplify the Codification
and draw a distinction between authoritative and nonauthoritative literature. This ASU is effective for public companies for
fiscal years beginning after December 15, 2024, but early adoption is permitted. The Company adopted this standard
prospectively on January 1, 2024, with no material impact to the consolidated financial statements or disclosures.
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