Duff & Phelps Corp - FORM 10-Q

Attached files

file	filename
EX-32.1 - Duff & Phelps Corp	v164527_ex32-1.htm
EX-31.2 - Duff & Phelps Corp	v164527_ex31-2.htm
EX-32.2 - Duff & Phelps Corp	v164527_ex32-2.htm
EX-31.1 - Duff & Phelps Corp	v164527_ex31-1.htm

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 September 30, 2009

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

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

The number of shares outstanding of the registrant’s Class A common stock, par value $0.01 per share, was 23,985,989 as of October 15, 2009. The number of shares outstanding of the registrant’s Class B common stock, par value $0.0001 per share, was 16,243,979 as of October 15, 2009.

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.	27

	Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	51

	Item 4.	Controls and Procedures.	51

Part II.	Other Information

	Item 1.	Legal Proceedings	52

	Item 1A.	Risk Factors	52

	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	52

	Item 3.	Defaults Upon Senior Securities	52

	Item 4.	Submission of Matters to a Vote of Security Holders	52

	Item 5.	Other Information	52

	Item 6.	Exhibits	53

	Signatures		54

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements.

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts)

(Unaudited)

	Three Months Ended						Nine Months Ended
	September 30,			September 30,			September 30,			September 30,
	2009			2008			2009			2008

Revenues	$	93,240		$	96,314		$	272,558		$	287,268
Reimbursable expenses		3,394			2,781			8,057			7,946
Total revenues		96,634			99,095			280,615			295,214

Direct client service costs
Compensation and benefits (including $4,294 and $7,551 of equity-based compensation for the three months ended September 30, 2009 and 2008, respectively, and $13,631 and $17,182 for the nine months ended September 30, 2009 and 2008, respectively)		52,287			57,280			155,115			166,276
Other direct client service costs		2,954			2,410			5,801			5,828
Acquisition retention expenses		-			206			-			782
Reimbursable expenses		3,468			2,813			8,120			7,926
Subtotal		58,709			62,709			169,036			180,812

Operating expenses
Selling, general and administrative expenses (including $2,018 and $2,845 of equity-based compensation for the three months ended September 30, 2009 and 2008, respectively, and $5,574 and $8,164 for the nine months ended September 30, 2009 and 2008, respectively)		24,620			29,538			74,048			83,301
Depreciation and amortization		2,594			2,446			7,712			6,903
Subtotal		27,214			31,984			81,760			90,204

Operating income		10,711			4,402			29,819			24,198

Other expense/(income)
Interest income		(17	)		(90	)		(34	)		(654	)
Interest expense		91			847			1,079			2,569
Loss on early extinguishment of debt		-			-			1,737			-
Other expense		50			(21	)		137			(92	)
Subtotal		124			736			2,919			1,823

Income before income taxes		10,587			3,666			26,900			22,375

Provision for income taxes		2,999			1,348			7,532			6,343

Net income		7,588			2,318			19,368			16,032

Less: Net income attributable to noncontrolling interest		4,136			2,165			12,417			13,204

Net income attributable to Duff & Phelps Corporation	$	3,452		$	153		$	6,951		$	2,828

Weighted average shares of Class A common stock outstanding
Basic		21,625			13,299			17,517			13,166
Diluted		22,448			13,673			18,197			13,397

Net income per share attributable to stockholders of Class A common stock of Duff & Phelps Corporation (Note 5)
Basic	$	0.15		$	0.01		$	0.37		$	0.20
Diluted	$	0.14		$	0.01		$	0.35		$	0.20

Cash dividends declared per common share	$	0.05		$	-		$	0.10		$	-

See accompanying notes to the condensed consolidated financial statements.

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except per share amounts)

	September 30,		December 31,
	2009		2008
	(Unaudited)
ASSETS
Current assets
Cash and cash equivalents	$	84,196	$	81,381
Restricted cash		689		-
Accounts receivable, net		62,340		55,876
Unbilled services		26,949		17,938
Prepaid expenses and other current assets		5,996		6,599
Net deferred income taxes, current		3,191		4,304
Total current assets		183,361		166,098

Property and equipment, net		28,266		28,350
Goodwill		117,012		116,456
Intangible assets, net		28,812		32,197
Other assets		2,758		3,541
Investments related to deferred compensation plan (Note 10)		16,368		7,946
Net deferred income taxes, non-current		91,633		61,609
Total non-current assets		284,849		250,099

Total assets	$	468,210	$	416,197

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable	$	4,250	$	3,692
Accrued expenses		7,944		4,424
Accrued compensation and benefits		21,315		39,282
Accrued benefits related to deferred compensation plan (Note 10)		17,167		8,479
Deferred revenue		4,499		3,280
Equity-based compensation liability		441		1,115
Current portion of long-term debt (Note 8)		-		794
Current portion due to non-controlling unitholders		3,148		3,148
Total current liabilities		58,764		64,214

Long-term debt, less current portion (Note 8)		-		42,178
Other long-term liabilities		15,916		16,715
Due to non-controlling unitholders, less current portion		88,879		55,331
Total non-current liabilities		104,795		114,224

Total liabilities		163,559		178,438

Commitments and contingencies (Note 11)

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; 23,984 and 14,719 shares issued and outstanding at September 30, 2009 and December 31, 2008, respectively)		240		147
Class B common stock, par value $0.0001 per share (50,000 shares authorized; 16,244 and 20,889 shares issued and outstanding at September 30, 2009 and December 31, 2008, respectively)		2		2
Additional paid-in capital		176,904		100,985
Accumulated other comprehensive income		1,048		122
Retained earnings/(accumulated deficit)		3,446		(1,127	)
Total stockholders' equity of Duff & Phelps Corporation		181,640		100,129
Noncontrolling interest		123,011		137,630
Total stockholders' equity		304,651		237,759
Total liabilities and stockholders' equity	$	468,210	$	416,197

See accompanying notes to the condensed consolidated financial statements.

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

	Nine Months Ended
	September 30,			September 30,
	2009			2008
Cash flows from operating activities:
Net income	$	19,368		$	16,032

Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		7,712			6,903
Equity-based compensation		19,205			25,345
Bad debt expense		1,698			1,251
Net deferred income taxes		4,637			8,575
Loss on early extinguishment of debt		1,674			-
Other		(582	)		1,163
Changes in assets and liabilities providing/(using) cash:
Accounts receivable		(8,065	)		(12,168	)
Unbilled services		(9,012	)		(2,216	)
Prepaid expenses and other current assets		973			63
Other assets		(2,396	)		1,542
Accounts payable and accrued expenses		4,668			(2,070	)
Accrued compensation and benefits		(10,019	)		(29,998	)
Deferred revenues		1,219			(3,004	)
Other liabilities		(1,399	)		690
Due to noncontrolling unitholders		-			(3,092	)
Net cash provided by operating activities		29,681			9,016

Cash flows from investing activities:
Purchase of property and equipment		(4,744	)		(8,093	)
Business acquisitions, net of cash acquired		(61	)		(16,427	)
Purchase of investments for deferred compensation plan		(6,409	)		(9,991	)
Proceeds from sale of investments in deferred compensation plan		-			1,692
Net cash used in investing activities		(11,214	)		(32,819	)

Cash flows from financing activities:
Net proceeds from sale of Class A common stock		111,808			-
Proceeds from exercises of IPO Options		456			-
Redemption of noncontrolling unitholders		(67,112	)		-
Repayments of debt		(42,763	)		(595	)
Distributions and other payments to noncontrolling unitholders		(15,510	)		(7,888	)
Increase in restricted cash		(689	)		-
Dividends		(2,394	)		-
Repurchases of Class A common stock		(821	)		-
Fees associated with early extinguishment of debt		(63	)		-
Net cash used in financing activities		(17,088	)		(8,483	)

Effect of exchange rate on cash and cash equivalents		1,436			(853	)

Net increase/(decrease) in cash and cash equivalents		2,815			(33,139	)
Cash and cash equivalents at beginning of period		81,381			90,243
Cash and cash equivalents at end of period	$	84,196		$	57,104

See accompanying notes to the condensed consolidated financial statements.

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY

AND COMPREHENSIVE INCOME

(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 nine months ended September 30, 2009		19,368		$	19,368		-			-			-			-		-			-			6,951			12,417
Currency translation adjustment		1,435			1,435		-			-			-			-		-			1,035			-			400
Amortization of post-retirement benefits		28			28		-			-			-			-		-			16			-			12
Total comprehensive income		20,831		$	20,831		-			-			-			-		-			1,051			6,951			12,829

Sale of Class A common stock		111,808					8,050			81			-			-		111,727			-			-			-
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		(807	)				1,292			13			-			-		(371	)		-			-			(449	)
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	)		-			-			-
Exercise of IPO Options		793					51			-			-			-		448			-			-			345
Forfeitures		1					(138	)		(1	)		(95	)		-		2			-			-			-
Equity-based compensation		19,798					-			-			-			-		10,457			-			-			9,341
Income tax benefit on equity-based compensation		(103	)				-			-			-			-		(103	)		-			-			-
Distributions to noncontrolling unitholders		(15,510	)				-			-			-			-		(6,187	)		-			-			(9,323	)
Change in ownership interests between periods		-					-			-			-			-		51,791			(125	)		-			(51,666	)
Adjustment to due to noncontrolling unitholders		(3,579	)				-			-			-			-		(3,579	)		-			-			-
Deferred tax asset effective tax rate conversion		3,513					-			-			-			-		3,412			-			-			101
Dividends on Class A common stock		(2,378	)				-			-			-			-		-			-			(2,378	)		-
Balance as of September 30, 2009	$	304,651					23,984		$	240			16,244		$	2	$	176,904		$	1,048		$	3,446		$	123,011

See accompanying notes to the condensed consolidated financial statements.

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY

AND COMPREHENSIVE INCOME

(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/(Loss)			Deficit)			Interest

Balance as of December 31, 2007	$	181,483						13,125		$	131		21,090		$	2	$	75,375		$	348		$	(6,352	)	$	111,979

Comprehensive income/(loss)
Net income for the nine months ended September 30, 2008		16,032		$	16,032			-			-		-			-		-			-			2,828			13,204
Currency translation adjustment		(853	)		(853	)		-			-		-			-		-			(353	)		-			(500	)
Amortization of post-retirement benefits		36			36			-			-		-			-		-			15			-			21
Total comprehensive income/(loss)		15,215		$	15,215			-			-		-			-		-			(338	)		2,828			12,725

Issuance of common stock		5,443						322			3		-			-		2,221			-			-			3,219
Issuance of restricted stock awards		12						1,156			12		-			-		-			-			-			-
Exercise of IPO options		114						7			-		-			-		114			-			-			-
Forfeitures		-						(13	)		-		(46	)		-		-			-			-			-
Equity-based compensation		25,274						-			-		-			-		10,418			-			-			14,856
Income tax benefit on equity-based compensation		175						-			-		-			-		175			-			-			-
Distributions to noncontrolling unitholders		(7,888	)					-			-		-			-		(3,160	)		-			-			(4,728	)
Change in ownership interests between periods		-						-			-		-			-		4,821			(202	)		-			(4,619	)
Other		(762	)					-			-		-			-		(577	)		-			-			(185	)
Balance as of September 30, 2008	$	219,066						14,597		$	146		21,044		$	2	$	89,387		$	(192	)	$	(3,524	)	$	133,247

See accompanying notes to the condensed consolidated financial statements.

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, corporate finance consulting and investment banking services. Its mission is to help its clients protect, maximize and recover value. The foundation of its services is its ability to provide independent advice on issues involving highly technical and complex assessments in the areas of valuation, taxation, dispute consulting, financial restructuring and M&A advisory. The Company believes the Duff & Phelps brand is associated with a high level of professional service and integrity, knowledge leadership and independent, trusted advice. The Company serves a global client base through offices in 24 cities, comprised of offices in 18 U.S. cities, including New York, Chicago, Dallas and Los Angeles, and six international offices located in Amsterdam, London, Munich, Paris, Shanghai and Tokyo.

Note 2 -

BASIS OF PRESENTATION

The Company was incorporated on April 23, 2007 as a Delaware corporation and formed as a holding company for the purpose of facilitating an initial public offering (“IPO”) of the Company’s common equity and to become the sole managing member of Duff & Phelps Acquisitions, LLC and subsidiaries (“D&P Acquisitions”).

IPO and Related Transactions

As a result of the IPO and the Recapitalization Transactions (as defined and described below), the Company became the sole managing member of and has a controlling interest in D&P Acquisitions. The Company’s only business is to act as the sole managing member of D&P Acquisitions, and, as such, the Company operates and controls all of the business and affairs of D&P Acquisitions and consolidates the financial results of D&P Acquisitions into the Company’s consolidated financial statements effective as of the close of business October 3, 2007.

Immediately prior to the closing of the IPO of the Company on October 3, 2007, D&P Acquisitions effectuated certain transactions intended to simplify the capital structure of D&P Acquisitions (the “Recapitalization Transactions”). Prior to the Recapitalization Transactions, D&P Acquisitions' capital structure consisted of seven different classes of membership interests (Classes A through G, collectively “Legacy Units”), each of which had different capital accounts and amounts of aggregate distributions above which its holders share in future distributions. The net effect of the Recapitalization Transactions was to convert the multiple-class structure into a single new class of units called “New Class A Units.” Pursuant to the Recapitalization Transactions and IPO, the Company issued a number of shares of Class B common stock to existing unitholders of D&P Acquisitions in an aggregate amount equal to the number of New Class A Units held by existing unitholders of D&P Acquisitions. The IPO, Recapitalization Transactions and the Company’s capital structure are further detailed in its Annual Report on Form 10-K for the year ended December 31, 2008.

Offering of Class A Common Stock

On May 18, 2009, the Company consummated a follow-on offering with the sale of 8,050 newly issued shares of Class A common stock at $14.75 per share, less an underwriting discount of $0.7375 per share, as summarized in the following table (“May 2009 Follow-On Offering”):

Stock subscription of 7,000 shares at $14.75 per share	$	103,250
Over allotment of 1,050 shares at $14.75 per share		15,488
Underwriting discount of 8,050 shares at $0.7375 per share		(5,937	)
Offering related expenses		(993	)
Net proceeds	$	111,808

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

The Company used $67,112 of net proceeds to redeem 3,500 New Class A Units of D&P Acquisitions held by entities affiliated with Lovell Minnick Partners and Vestar Capital Partners and 1,050 New Class A Units of D&P Acquisitions held by employees (including executive officers), directors and entities affiliated with directors. Units were redeemed at a price per unit equal to the public offering price. In connection with the redemption, a corresponding number of shares of Class B common stock were cancelled. In addition, the Company used $42,366 of the net proceeds to repay outstanding borrowings and terminated its former credit facility with GE Capital Corporation (see Note 8). In connection with the repayment, the Company incurred a nonrecurring charge of $1,737 to reflect the accelerated amortization of the debt discount and issuance costs of which $1,674 was non-cash.

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 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 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, 2008 was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles 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 Adopted Accounting Pronouncements

In September 2009, the Company adopted FASB ASC 105-10, Generally Accepted Accounting Principles – Overall. FASB ASC 105-10 establishes the FASB Accounting Standards CodificationTM (“Codification”) to become the source of authoritative U.S. generally accepted accounting principles (“U.S. GAAP”) recognized by the FASB to be applied by nongovernmental entities. Rules and interpretive releases of the Securities and Exchange Commission (“SEC”) under authority of federal securities laws are also sources of authoritative U.S. GAAP for SEC registrants. FASB ASC 105-10 and the Codification are effective for financial statements issued for interim and annual periods ending after September 15, 2009. The adoption of this standard will not have a material impact on the Company’s consolidated financial position or results of operations.

In June 2009, the Company adopted Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 855-10, Subsequent Events – Overall. FASB ASC 855-10 establishes principles and requirements for subsequent events and sets forth (a) the period after the balance sheet date during which management of a reporting entity should evaluate events or transactions that may occur for potential recognition or disclosure in the financial statements, (b) the circumstances under which an entity should recognize events or transactions occurring after the balance sheet date in its financial statements and (c) the disclosures that an entity should make about events or transactions that occurred after the balance sheet date. The adoption of FASB ASC 855-10 did not have a material impact on the Company’s consolidated financial position or results of operations.

Effective January 1, 2009, the Company implemented FASB ASC 810-10, Business Combinations – Identifiable Assets and Liabilities, and Any Noncontrolling Interest. The implementation of this standard primarily effected the presentation of the Company’s consolidated financial statements whereby noncontrolling interest is presented as a component of stockholders’ equity. The presentation and disclosure requirements were applied retrospectively for all periods presented.

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

Effective January 1, 2009, the Company adopted FASB ASC 805-20, Business Combinations – Identifiable Assets and Liabilities, and Any Noncontrolling Interest. FASB ASC 805-20 requires the acquiring entity in a business combination to recognize the full fair value of assets acquired and liabilities assumed in the transaction, establishes the acquisition-date fair value as the measurement objective for all assets acquired and liabilities assumed, requires expensing of most transaction costs, and requires the acquirer to disclose to investors and other users all of the information needed to evaluate and understand the nature and financial effect of the business combination. The effect this pronouncement will have on the Company is dependent upon each specific acquisition which may or may not occur in the current or future periods.

Effective January 1, 2009, the Company adopted the remaining provisions of FASB ASC 820-10-65, Fair Value Measurements and Disclosures – Overall –Transition and Open Effective Date Information, related to fair-value measurements of certain nonfinancial assets and liabilities. The adoption of the remaining provisions of FASB ASC 820-10-65 did not have a material impact on the Company’s consolidated financial position or results of operations.

Recently Issued Accounting Pronouncements

In August 2009, the FASB issued Accounting Standards Update (“ASU”) No. 2009-05, Measuring Liabilities at Fair Value (“ASU 2009-05”). ASU 2009-05 amends FASB ASC 820, Fair Value Measurements and Disclosures, by providing additional guidance clarifying the measurement of liabilities at fair value. ASU 2009-05 applies to the fair value measurement of liabilities within the scope of ASC 820 and addresses several key issues with respect to estimating fair value of liabilities. Among other things, ASU 2009-05 clarifies how the price of a traded debt security (an asset value) should be considered in estimating the fair value of the issuer’s liability. ASU 2009-05 is effective for the first reporting period beginning after its issuance. The Company does not expect the adoption of ASU 2009-05 to have a material impact on its consolidated financial statements.

In October 2009, the FASB issued ASU No. 2009-13, Multiple-Deliverable Revenue Arrangements. ASU 2009-13 supersedes certain guidance in FASB 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 arrangement entered into, or materially modified, after the effective date or through retrospective application to all revenue arrangement for all periods presented. The Company is evaluating the impact that the adoption of ASU 2009-13 will have on its consolidated financial statements.

Critical Accounting Policies

There have been no other 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, 2008. 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, 2008. The financial data for the interim periods may not necessarily be indicative of results to be expected for the year.

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

Note 3 -

NONCONTROLLING INTEREST

The Company has sole voting power in and controls the management of D&P Acquisitions, and it owns a majority economic interest in D&P Acquisitions (59.6% at September 30, 2009). 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. Net income attributable to 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 New Class A Units owned by such unitholders. The ownership of the New Class A Units is summarized as follows:

	Duff &			Non-
	Phelps			Controlling
	Corporation			Unitholders			Total
December 31, 2008		14,719			20,889			35,608
Sale of Class A common stock		8,050			-			8,050
Issuance of Class A common stock		10			-			10
Redemption of New Class A Units		-			(4,550	)		(4,550	)
Net issuance of restricted stock awards		1,292			-			1,292
Exercises of IPO Options		51			-			51
Forfeitures		(138	)		(95	)		(233	)
September 30, 2009		23,984			16,244			40,228

Percent of total New Class A Units
December 31, 2008		41.3	%		58.7	%		100	%
September 30, 2009		59.6	%		40.4	%		100	%

As a result of the May 2009 Follow-On Offering, the Company’s economic interest in D&P Acquisitions changed from a minority to a majority position. This change did not result in a change of control as the Company has always maintained sole voting power in and control of the management of D&P Acquisitions.

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						Nine Months Ended
	September 30,						September 30,
	2009			2008			2009			2008
Income before income taxes	$	10,587		$	3,666		$	26,900		$	22,375
Less: provision for income taxes for entities other than Duff & Phelps Corporation(a)(b)		(292	)		(101	)		(964	)		(162	)
Income before income taxes, as adjusted		10,295			3,565			25,936			22,213
Ownership percentage of noncontrolling interest(d)		40.2	%		60.7	%		47.9	%		59.4	%
Net income attributable to noncontrolling interest		4,136			2,165			12,417			13,204
Income before income taxes, as adjusted, attributable to Duff & Phelps Corporation		6,159			1,400			13,519			9,009
Less: provision for income taxes of Duff & Phelps Corporation(a)(c)		(2,707	)		(1,247	)		(6,568	)		(6,181	)
Net income attributable to Duff & Phelps Corporation	$	3,452		$	153		$	6,951		$	2,828

(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 $2,999 and $1,348 for the three months ended September 30, 2009 and 2008, respectively, and $7,532 and $6,343 for the nine months ended September 30, 2009 and 2008, 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.

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

Distributions and Other Payments to Noncontrolling Unitholders

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

	Nine Months Ended
	September 30,		September 30,
	2009		2008
Distributions for taxes	$	14,197	$	7,888
Other distributions		1,313		-
Payments pursuant to the Tax Receivable Agreement		-		-
	$	15,510	$	7,888

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%. During the nine months ended September 30, 2009 and 2008, D&P Acquisitions made aggregate distributions to its members totaling $14,197 and $7,888, respectively, not including the Company, with respect to estimated taxable income for year-to-date 2009 and 2008, respectively. 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.

Other distributions

During the nine months ended September 30, 2009, the Company distributed $1,313 to holders of New Class A Units of D&P Acquisitions (other than Duff & Phelps Corporation). The distributions were made concurrently with the dividend of $0.05 per share of Class A common stock outstanding to shareholders of record on June 12, 2009 and August 18, 2009. Concurrent with the payment of the dividends, holders of New Class A Units received a $0.05 distribution per vested unit which 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 distribution of $0.05 per unvested unit was deposited into a segregated account and will be released once a year with respect to units that vested during that year. The segregated amount for unvested units totaled $312 and is included as a component of “Restricted cash” on the Consolidated Balance Sheet at September 30, 2009. The distribution on unvested units that forfeit will be 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.

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

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. There were no payments under the TRA in the nine months ended September 30, 2009 as these payments are typically made in the fourth quarter of each year. In December 2009, the Company expects to make payments under the TRA of $3,148 relating to the year ended December 31, 2008. In December 2008, the Company made payments of $791 with respect to the period from October 4 through December 31, 2007. D&P Acquisitions expects to make future payments under the TRA to the extent cash is available for such purposes.

At September 30, 2009, the Company recorded a liability of $92,027, representing the payments due to D&P Acquisitions’ unitholders under the TRA. This amount includes additional obligations generated from the redemption of 4,550 New Class A Units of D&P Acquisitions (see Note 2) in conjunction with the May 2009 Follow-On Offering. This transaction resulted in an increase in the TRA liability of $33,548 and an associated increase in net deferred tax assets.

Within the next 12 month period, the Company expects to pay $3,148 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 tax receivable agreement, 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, filed as Exhibit 10.3 to the Quarterly Report on Form 10-Q as filed with the SEC on November 14, 2007.

Obligations pursuant to the Tax Receivable Agreement 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, filed as Exhibit 10.1 to the Quarterly Report on Form 10-Q as filed with the SEC on November 14, 2007.

During the nine months ended September 30, 2009, the Company recorded an immaterial adjustment to increase the payments due to D&P Acquisitions’ unitholders under the tax receivable agreement by $3,579 with an offsetting credit to additional paid-in-capital. The adjustment resulted from a correction to the calculation of the tax receivable agreement liability in conjunction with the IPO transactions. Although the revision related to the date of the closing of the IPO transactions, it did not have a material impact on the Company’s financial position through and as of September 30, 2009.

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

Note 4 -

ACQUISITIONS

The following table summarizes the Company’s recent acquisitions:

Effective
Date	Acquisition	Description

4/11/08	Dubinsky & Company, P.C.	Washington, D.C. metro based specialty consulting primarily
		focused on litigation support and forensic services.

7/15/08	World Tax Service US, LLC	Tax advisory firm focused on the delivery of sophisticated
		international and domestic tax services.

7/31/08	Kane Reece Associates, Inc.	Valuation, management and technical consulting firm with a
		focus on the communications, entertainment and media industries.

8/8/08	Financial and IP Analysis, Inc.	Financial consulting firm that specializes in intellectual
	(d/b/a The Lumin Expert Group)	property dispute support and expert testimony.

The purchase price of each of these acquisitions is immaterial to the Company’s consolidated financial statements, both individually and in the aggregate. Each of these acquisitions operates as part of the Financial Advisory segment.

Pursuant to the terms of the acquisition of Chanin Capital Partners, LLC (“Chanin”) by D&P Acquisitions on October 31, 2006, the Chanin sellers are eligible for one remaining earn-out payment estimated to be a minimum of approximately $4,000 up to a maximum of approximately $5,000 for the annual period ending October 31, 2009. This earn-out payment is subject to the achievement of certain contingent performance results of Chanin.

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

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 June 2008, the FASB issued FASB ASC 260-10-45, Earnings Per Share – Overall – Other Presentation Matters which is effective for fiscal years beginning January 1, 2009. FASB ASC 260-10-45 provides that 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. FASB ASC 260-10-45 requires retrospective application to all prior period net income per share calculations.

Our restricted stock awards are considered participating securities as they receive nonforfeitable dividends at the same rate as our common stock. In accordance with FASB ASC 260-10-45, 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 required under FASB ASC 260-10-45 reduces earnings available for common stockholders.

The effect of applying FASB ASC 260-10-45 changed basic net income per share from $0.16 to $0.15 for the three months ended September 30, 2009, from $0.40 to $0.37 for the nine months ended September 30, 2009, and from $0.21 to $0.20 for the nine months ended September 30, 2008. There was no change in basic earnings per share for the three months ended September 30, 2008. The effect of applying FASB ASC 260-10-45 changed fully diluted net income per share from $0.15 to $0.14 for the three months ended September 30, 2009, from $0.38 to $0.35 for the nine months ended September 30, 2009, and from $0.21 to $0.20 for the nine months ended September 30, 2008. There was no change in diluted earnings per share for the three months ended September 30, 2008.

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

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

	Three Months Ended						Nine Months Ended
	September 30,			September 30,			September 30,			September 30,
	2009			2008			2009			2008
Basic and diluted net income per share attributable to holders of Class A common stock:

Numerator:
Net income attributable to Duff & Phelps Corporation	$	3,452		$	153		$	6,951		$	2,828
Earnings allocated to participating securities		(220	)		(12	)		(493	)		(179	)
Earnings available for common stockholders	$	3,232		$	141		$	6,458		$	2,649

Denominator for basic net income per share attributable to holders of Class A common stock:
Weighted average shares of Class A common stock		21,625			13,299			17,517			13,166

Denominator for diluted net income per share attributable to holders of Class A common stock:
Weighted average shares of Class A common stock		21,625			13,299			17,517			13,166
Add dilutive effect of the following:
Ongoing RSAs		823			374			680			231
Assumed conversion of New Class A Units for Class A common stock(a)		-			-			-			-
Dilutive weighted average shares of Class A common stock		22,448			13,673			18,197			13,397

Net income per share attributable to holders of Class A common stockof Duff & Phelps Corporation

Basic	$	0.15		$	0.01		$	0.37		$	0.20

Diluted	$	0.14		$	0.01		$	0.35		$	0.20
_______________________________

(a) The following shares were anti-dilutive and excluded from this calculation:
Weighted average New Class A Units outstanding		16,246			20,684			18,584			20,693
Weighted average IPO Options outstanding		1,889			2,032			1,935			2,048

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) IPO Options and/or Ongoing RSAs listed above exceeding those outstanding under the treasury stock method. The 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.

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, 2008. Except for adjustments to estimated forfeiture rates based on the most recent available information, 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, 2008.

Equity-based compensation with respect to (a) grants of 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
	September 30, 2009						September 30, 2008
	Client						Client
	Service		SG&A		Total		Service		SG&A		Total
Legacy Units	$	1,610	$	758	$	2,368	$	5,237	$	1,548	$	6,785
IPO Options		514		347		861		1,348		572		1,920
Ongoing RSAs		2,170		913		3,083		966		725		1,691
Total	$	4,294	$	2,018	$	6,312	$	7,551	$	2,845	$	10,396

	Nine Months Ended						Nine Months Ended
	September 30, 2009						September 30, 2008
	Client						Client
	Service		SG&A		Total		Service		SG&A		Total
Legacy Units	$	6,138	$	2,046	$	8,184	$	11,350	$	4,273	$	15,623
IPO Options		1,866		913		2,779		3,741		1,657		5,398
Ongoing RSAs		5,627		2,615		8,242		2,091		2,234		4,325
Total	$	13,631	$	5,574	$	19,205	$	17,182	$	8,164	$	25,346

Restricted stock awards and restricted stock units were granted as a form of incentive compensation and are accounted for similarly. Corresponding expense is recognized based on the fair market value on the date of grant. Restricted stock units are granted to certain of our international employees, are generally contingent on continued employment and are typically converted to Class A common stock when restrictions on transfer lapse after three years.

During the nine months ended September 30, 2009, the Company issued 1,426 Ongoing RSAs related to annual bonus incentive compensation, performance incentive initiatives, promotions and recruiting efforts. Expense is recognized based on the fair market value on the date of grant over the service period. 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 1,426 Ongoing RSAs granted, 221 awards were granted to executives on February 26, 2009 and 18 to the Board of Directors on April 30, 2009. The restrictions on transfer and forfeiture provisions are eliminated annually over three years based on ratable vesting for grants made to executives and four years for non-employee members of our Board of Directors.

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 IPO Options and Ongoing RSAs:

				Restricted			Restricted
	IPO			Stock			Stock
	Options			Awards			Units
Balance as of December 31, 2008		1,997			1,248			92
Grants of Ongoing RSAs		-			1,345			81
Converted to Class A common stock upon lapse of restrictions		-			(74	)		-
Ongoing RSAs withheld for payroll taxes		-			(53	)		-
Exercises of IPO Options		(51	)		-			-
Forfeitures		(106	)		(138	)		-
Balance as of September 30, 2009		1,840			2,328			173

Vested		900			-			-
Unvested		940			2,328			173

Weighted average fair value on grant date	$	7.33		$	14.12		$	13.88
Weighted average exercise price	$	16.00
Weighted average remaining contractual term		8.00
Total intrinsic value of exercised options	$	202
Total fair value of options vested	$	6,597
Aggregate intrinsic value	$	5,814
Options expected to vest		807
Aggregate intrinsic value of options expected to vest	$	2,550

The following table summarizes activity for New Class A Units attributable to equity-based compensation:

	New
	Class A Units
	Attributable to
	Equity-Based
	Compensation
Balance as of December 31, 2008		6,615
Redemptions		(708	)
Forfeitures		(95	)
Balance as of September 30, 2009		5,812

Vested		4,121
Unvested		1,691

The total unamortized compensation cost related to all non-vested awards was approximately $24,452 at September 30, 2009. The weighted-average period over which this is expected to be recognized is approximately 1.6 years. A tax benefit of $1,581 and $1,121 was recognized for IPO Options and Ongoing RSAs for the nine months ended September 30, 2009 and 2008, respectively.

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 at September 30, 2009:

	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)(2)	$	-	$	16,368	$	-	$	16,368
Total assets	$	-	$	16,368	$	-	$	16,368

Benefits payable in conjunction with deferred compensation plan(1)	$	-	$	17,167	$	-	$	17,167
Interest rate swap(3)		-		443		-		443
Total liabilities	$	-	$	17,610	$	-	$	17,610

____________________________

(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 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. The deferred compensation plan is further discussed in Note 10.

(2)

Investments held in conjunction with the deferred compensation plan exclude approximately $727 which is included in cash and cash equivalents at September 30, 2009.

(3)

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.

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

Note 8 -

LONG-TERM DEBT

The Company’s long-term obligations are summarized in the following table:

	September 30,		December 31,
	2009		2008

Outstanding balance of credit facility	$	-	$	42,763
Less: current amounts due in following year		-		(794	)
Long-term portion		-		41,969
Debt discount and interest rate swap		-		209
Long-term debt, less current portion	$	-	$	42,178

On May 22 , 2009, the Company terminated its Amended and Restated Credit Agreement (“Former Credit Facility”), dated as of July 30, 2008, by and among Duff & Phelps, LLC, the primary operating subsidiary of the Company, D&P Acquisitions, the persons designated as lenders thereto, and General Electric Capital Corporation (“GE Capital”), in its capacity as Administrative Agent. The Former Credit Facility consisted of a (i) $65,000 seven-year term loan, (ii) $15,000 delayed draw term loan, (iii) $20,000 six-year revolver loan, and (iv) $75,000 incremental term loan facility, which was uncommitted by the lenders and required additional approval at the time of request.

As described in Note 1, the Company used a portion of the net proceeds from its May 2009 Follow-On Offering to repay all amounts outstanding under the Former Credit Facility. In connection with the repayment, the Company incurred a nonrecurring charge of $1,737 to reflect the accelerated amortization of the debt discount and issuance costs of which $1,674 was non-cash.

On July 15, 2009, Duff & Phelps, LLC entered into a Credit Agreement ("Current Credit Agreement") with Bank of America, N.A., as administrative agent and the lenders from time to time party thereto, providing for a $30,000 senior secured revolving credit facility (“Current 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.

Loans under the Current 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 September 30, 2009, the Company qualified for the 1.75% applicable margin and 0.25% unused commitment fee.

The Current 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, (b) 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 Current 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 September 30, 2009. The Current Credit Agreement permits dividend payments or other distributions in the Company’s common stock or other equity interests subject to certain limitations.

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

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

Letters of Credit

At September 30, 2009, the Company had $4,111 of outstanding letters of credit, primarily in connection with real estate leases. $377 of cash was deposited into a restricted account to serve as deposits to secure certain of these letters of credit.

Interest Rate Swap

The Company has a $11,600 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 Former Credit Facility, 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 Condensed Consolidated Statement of Operations. At September 30, 2009, the liability resulting from the interest rate swap was included in “Other long-term liabilities.” Prior to the termination of the Former Credit Facility with GE Capital, this amount was included as a component of “Long-term debt, less current portion.”

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						Nine Months Ended
	September 30,			September 30,			September 30,			September 30,
	2009			2008			2009			2008
Gain/(loss) resulting from change
in fair value of interest rate swap	$	162		$	125		$	487		$	71

Estimated fair value - asset/(liability)	$	(443	)	$	(492	)	$	(443	)	$	(492	)

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						Nine Months Ended
	September 30,			September 30,			September 30,			September 30,
	2009			2008			2009			2008
Provision for income taxes	$	2,999		$	1,348		$	7,532		$	6,343
Effective income tax rate		28.3	%		36.8	%		28.0	%		28.3	%

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 740-10-50 Income Taxes – Overall – Disclosure. A reconciliation of the beginning and ending amount of unrecognized tax benefit is summarized as follows:

Balance as of December 31, 2008	$	502
Additional based on tax positions related to the current year		84
Balance as of September 30, 2009	$	586

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.

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, 2008.

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 approximated fair market value at September 30, 2009.

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

	September 30,		December 31,
	2009		2008
Fair market value of investments in rabbi trust	$	16,368	$	7,946
Payable to participants of the plan		17,167		8,479

______________________

(1)

The fair market value of investments in rabbi trust held in conjunction with the deferred compensation plan exclude approximately $727 which is included in cash and cash equivalents at September 30, 2009.

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 “Accrued benefits related to deferred compensation plan” on the Consolidated Balance Sheet. 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 -

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.

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

Note 12 -

SEGMENT INFORMATION

Prior to January 1, 2009, the Company provided services through two segments: Financial Advisory and Investment Banking. Effective January 1, 2009, the Company changed the structure of its internal organization in a manner that caused the composition of its reportable segments to change. As a result, the Corporate Finance Consulting business, previously part of Financial Advisory, became a third segment. Segment results for the three and nine months ended September 30, 2008 have been recast to reflect current year presentation.

The Financial Advisory segment provides valuation advisory services, tax services, 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 transaction opinions, merger and acquisition advisory services, and restructuring advisory services.

	Three Months Ended						Nine Months Ended
	September 30,			September 30,			September 30,			September 30,
	2009			2008			2009			2008
Financial Advisory
Revenues (excluding reimbursables)	$	57,634		$	65,022		$	176,431		$	191,919
Segment operating income		8,855			8,717			29,543			29,627
Segment operating income margin		15.4	%		13.4	%		16.7	%		15.4	%

Corporate Finance Consulting
Revenues (excluding reimbursables)	$	17,445		$	15,211		$	47,039		$	43,036
Segment operating income		5,389			3,080			11,819			9,741
Segment operating income margin		30.9	%		20.2	%		25.1	%		22.6	%

Investment Banking
Revenues (excluding reimbursables)	$	18,161		$	16,081		$	49,088		$	52,313
Segment operating income		2,364			3,994			7,195			13,516
Segment operating income margin		13.0	%		24.8	%		14.7	%		25.8	%

Total
Revenues (excluding reimbursables)	$	93,240		$	96,314		$	272,558		$	287,268

Segment operating income	$	16,608		$	15,791		$	48,557		$	52,884
Net client reimbursable expenses		(74	)		(32	)		(63	)		20
Equity-based compensation
from Legacy Units and IPO Options		(3,229	)		(8,705	)		(10,963	)		(21,021	)
Depreciation and amortization		(2,594	)		(2,446	)		(7,712	)		(6,903	)
Acquisition retention expenses		-			(206	)		-			(782	)
Operating income	$	10,711		$	4,402		$	29,819		$	24,198

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

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. In the three months ended September 30, 2009 and 2008, the Financial Advisory segment (primarily Valuation Advisory services) recognized revenues of $2,972 and $2,657 from the cross utilization of its client service professionals on engagements from the Corporate Finance Consulting segment (primarily Portfolio Valuation services), respectively. In the nine months ended September 30, 2009 and 2008, the Financial Advisory segment (primarily Valuation Advisory services) recognized revenues of $9,539 and $11,418 from the cross utilization of its client service professionals on engagements from the Corporate Finance Consulting segment (primarily Portfolio Valuation services), respectively.

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

	Three Months Ended				Nine Months Ended
	September 30,		September 30,		September 30,		September 30,
	2009		2008		2009		2008
United States	$	83,745	$	86,783	$	246,649	$	258,464
Europe		7,668		7,663		21,499		24,838
Asia		1,827		1,868		4,410		3,966
Revenues (excluding reimbursables)	$	93,240	$	96,314	$	272,558	$	287,268

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

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

Note 13 -

RELATED PARTY TRANSACTIONS

Lovell Minnick Partners

In conjunction with the May 2009 Follow-On Offering, the Company redeemed 1,900 New Class A Units of D&P Acquisitions held by entities affiliated with Lovell Minnick Partners at a price per unit equal to the public offering price or an aggregate amount of $28,025.

In addition, D&P Acquisitions made distributions totaling $3,946 and $1,974 to entities affiliated with Lovell Minnick Partners in the nine months ended September 30, 2009 and 2008, respectively. Of the total, $3,584 and $1,974 were distributions for taxes during the nine months ended September 30, 2009 and 2008 with respect to estimated taxable income for 2008 and 2007, respectively. The remaining $362 for the nine months ended September 30, 2009 was a distribution of $0.05 per unit. Both of these distributions are further described in Note 3.

Two managing directors of Lovell Minnick Partners serve as independent directors on the Company’s Board of Directors.

Vestar Capital Partners

In conjunction with the May 2009 Follow-On Offering, the Company redeemed 1,600 New Class A Units of D&P Acquisitions held by entities affiliated with Vestar Capital Partners at a price per unit equal to the public offering price or an aggregate amount of $23,600. Included in this amount were payments to Noah Gottdiener, Chairman and Chief Executive Officer, Gerard Creagh, President, and Harvey Krueger, an independent director, who are also members in a limited liability company managed by Vestar Capital Partners. As a result, Messrs. Gottdiener, Creagh and Krueger each received approximately $53, $53 and $42, respectively, as a result of such redemptions.

In addition, D&P Acquisitions made distributions totaling $4,931 and $2,371 to entities affiliated with Vestar Capital Partners in the nine months ended September 30, 2009 and 2008, respectively. Of the total, $4,429 and $2,371 were distributions for taxes during the nine months ended September 30, 2009 and 2008 with respect to estimated taxable income for 2008 and 2007, respectively. The remaining $502 for the nine months ended September 30, 2009 was a distribution of $0.05 per unit. Both of these distributions are further described in Note 3.

A managing director of Vestar Capital Partners serves as an independent director on the Company’s Board of Directors.

DUFF & PHELPS CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share amounts)

(Unaudited)

Note 14 -

SUBSEQUENT EVENTS

On October 5, 2009, D&P Acquisitions entered into an amendment (the “Amendment”) to the Exchange Agreement, dated as of October 3, 2007, by and among D&P Acquisitions and the unitholders of D&P Acquisitions named therein. Prior to the Amendment, the unitholders of D&P Acquisitions could exchange New Class A Units of D&P Acquisitions on a one-for-one basis for shares of Class A common stock of the Company once per quarter upon 45 days notice, with each exchange to occur on the fifth business day prior to the last business day of such quarter. Pursuant to the Amendment, such exchanges will now occur on March 5th, May 15th, August 15th and November 15th of each year. In addition, the 45-day notice period for the November 15, 2009 exchange was shortened to 30 days. The Amendment also contained certain textual amendments that were solely for the purpose of clarification. The Amendment is filed as Exhibit 10.1 to the Current Report on Form 8-K as filed with the SEC on October 6, 2009.

Pursuant to Section 2.1 of the Registration Rights Agreement, dated as of October 3, 2007, by and among the Company and the stockholders of the Company party thereto, the Company filed a Shelf Registration Statement on Form S-3 (“Form S-3”) registering for resale the shares of Class A common stock of the Company issuable to unitholders of D&P Acquisitions upon exchange of their New Class A Units of D&P Acquisitions for shares of Class A common stock of the Company. The Form S-3 was declared effective by the SEC on October 26, 2009.

On November 3, 2009, the Company announced that its board of directors had declared a quarterly dividend of $0.05 per share on its outstanding Class A common stock. The dividend is payable on December 4, 2009, to shareholders of record on November 24, 2009. Concurrently with the payment of the dividend, the Company will be distributing $0.05 per unit to holders of New Class A Units.

In accordance with FASB ASC 855-10, Subsequent Events – Overall, management of the Company evaluated subsequent events through November 3, 2009, the date the financial statements were issued.

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, 2008, as filed with the Securities and Exchange Commission (“SEC”) on February 26, 2009 (“2008 Form 10-K”); any subsequent filings of our Quarterly Reports on Form 10-Q; and other filings with the SEC, including the Current Report on Form 8-K filed on October 16, 2009 which adjusts certain parts of our 2008 Form 10-K to reflect changes arising from (i) the adoption of new accounting standards, (ii) changes in the Company’s segment reporting that were effective January 1, 2009, and (iii) material subsequent events. 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 SEC. 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,

·	useful lives of intangible assets,

·	the carrying value of goodwill and intangible assets,

·	allowances for doubtful accounts,

·	gains and losses on engagements,

·	amounts due to noncontrolling unitholders,

·	reserves for estimated tax liabilities,

·	contingent liabilities, and

·	certain estimates and assumptions used in the calculation of (i) the fair value of equity compensation issued to employees and (ii) segment operating income.

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, 2008, as filed with the SEC on February 26, 2009. During the nine months ended September 30, 2009, there were no significant changes in our critical accounting policies and estimates, except for a change in our segment reporting. Prior to January 1, 2009, the Company provided services through two segments: Financial Advisory and Investment Banking. Effective January 1, 2009, the Company changed the structure of its internal organization in a manner that caused the composition of its reportable segments to change. As a result, the Corporate Finance Consulting business, previously part of Financial Advisory, became a third segment. Segment results for prior periods have been recast to reflect current year presentation.

Results of Operations

Duff & Phelps Corporation (the “Company”) is a leading provider of independent financial advisory, corporate finance consulting and investment banking services. Our mission is to help its clients protect, maximize and recover value. The foundation of our services is our ability to provide independent advice on issues involving highly technical and complex assessments in the areas of valuation, taxation, dispute consulting, financial restructuring and M&A advisory. We believe the Duff & Phelps brand is associated with a high level of professional service and integrity, knowledge leadership and independent, trusted advice. The Company serves a global client base through offices in 24 cities, comprised of offices in 18 U.S. cities, including New York, Chicago, Dallas and Los Angeles, and six international offices located in Amsterdam, London, Munich, Paris, Shanghai and Tokyo.

Prior to January 1, 2009, we provided services through two segments: Financial Advisory and Investment Banking. Effective January 1, 2009, we changed the structure of our internal organization in a manner that caused the composition of our reportable segments to change. In order to align our segment reporting with the focus of our business in 2009 and beyond, the Corporate Finance Consulting business, previously part of Financial Advisory, became a third segment.

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, 2008.

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

The following defined terms are used in this section: Financial Accounting Standards Board (“FASB”); Accounting Standards Codification (“ASC”); and Statement of Financial Accounting Standards (“SFAS”).

Three months ended September 30, 2009 versus three months ended September 30, 2008

The results of operations are summarized as follows:

Results of Operations

(Dollars in thousands)

	Three Months Ended
	September 30,			September 30,			Unit			Percent
	2009			2008			Change			Change

Revenues	$	93,240		$	96,314		$	(3,074	)		(3.2	)%
Reimbursable expenses		3,394			2,781			613			22.0	%
Total revenues		96,634			99,095			(2,461	)		(2.5	)%

Direct client service costs
Compensation and benefits(1)		52,287			57,280			(4,993	)		(8.7	)%
Other direct client service costs		2,954			2,410			544			22.6	%
Acquisition retention expenses		-			206			(206	)		(100.0	)%
Reimbursable expenses		3,468			2,813			655			23.3	%
		58,709			62,709			(4,000	)		(6.4	)%

Operating expenses
Selling, general and administrative(2)		24,620			29,538			(4,918	)		(16.6	)%
Depreciation and amortization		2,594			2,446			148			6.1	%
		27,214			31,984			(4,770	)		(14.9	)%

Operating income		10,711			4,402			6,309			143.3	%

Other expense/(income)
Interest income		(17	)		(90	)		73			(81.1	)%
Interest expense		91			847			(756	)		(89.3	)%
Loss on early extinguishment of debt		-			-			-			-
Other expense		50			(21	)		71			(338.1	)%
		124			736			(612	)		(83.2	)%

Income before income taxes		10,587			3,666			6,921			188.8	%

Provision for income taxes		2,999			1,348			1,651			122.5	%

Net income		7,588			2,318			5,270			227.4	%

Less: Net income attributable to the noncontrolling interest		4,136			2,165			1,971			91.0	%

Net income attributable to Duff & Phelps Corporation	$	3,452		$	153		$	3,299			2156.2	%

Other financial and operating data

Adjusted EBITDA(3)	$	16,534		$	15,759		$	775			4.9	%

Adjusted EBITDA(3) as a percentage of revenues		17.7	%		16.4	%		1.4	%		8.4	%

End of period managing directors		162			168			(6	)		(3.6	)%

End of period client service professionals		902			993			(91	)		(9.2	)%

(1)	Compensation and benefits include $4,294 and $7,551 of equity-based compensation expense for the three months ended September 30, 2009 and 2008, respectively.

(2)	Selling, general and administrative expenses include $2,018 and $2,845 of equity-based compensation expense for the three months ended September 30, 2009 and 2008, respectively.

(3)	Adjusted EBITDA is a non-GAAP financial measure and is calculated as follows:

(3)	Continued . . .

Reconciliation of Adjusted EBITDA

(Dollars in thousands)

	Three Months Ended
	September 30,			September 30,
	2009			2008
Revenues (excluding client reimbursables)	$	93,240		$	96,314

Net income attributable to Duff & Phelps Corporation	$	3,452		$	153
Net income attributable to the noncontrolling interest		4,136			2,165
Provision for income taxes		2,999			1,348
Other expense/(income), net		124			736
Depreciation and amortization		2,594			2,446
Equity-based compensation associated with Legacy Units and IPO Options		3,229			8,705
Acquisition retention expenses		-			206

Adjusted EBITDA	$	16,534		$	15,759

Adjusted EBITDA as a percentage of revenues		17.7	%		16.4	%

Adjusted EBITDA is a non-GAAP financial measure. 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 attributable to Duff & Phelps Corporation for (a) 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), (b) equity-based compensation associated with the Legacy Units, a significant portion of which is due to certain one-time grants associated with predecessor acquisitions and IPO Options, (c) acquisition retention expenses which are related to deferred payments associated with prior acquisitions, and (d) net income attributable to the noncontrolling interest.

Given the level of acquisition activity during the period prior to the Company’s initial public offering (“Predecessor”), and related capital investments and one time equity grants associated with acquisitions during the Predecessor period (which we do not expect to incur at the same levels in periods subsequent to the Company’s initial public offering) 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 current 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, consists of net income attributable to Duff & Phelps Corporation before (a) net income attributable to the noncontrolling interest, (b) provision for income taxes, (c) other expense/(income), net, (d) depreciation and amortization, (e) acquisition retention expenses, and (f) equity-based compensation associated with Legacy Units and IPO Options included in (i) compensation and benefits and (ii) selling, general and administrative expenses.

This non-GAAP financial measure is not prepared in accordance with, and should not be considered an alternative 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 differently and, therefore, Adjusted EBITDA as presented for us may not be comparable to Adjusted EBITDA reported by other companies.

Overview

The current economic landscape continues to present us with opportunities and challenges. While our service offerings generally correlated to the volume of M&A transactions continue to experience reduced demand, growth in other business units partially offset this reduction with opportunities arising from counter-cyclical and non-cyclical services. Services we believe to be generally counter-cyclical include our Global Restructuring Advisory, Dispute & Legal Management Consulting, and goodwill impairment testing in conjunction with FASB ASC 350-20, Intangibles – Goodwill and Other (formerly SFAS 142). Services we believe to be generally non-cyclical include Portfolio Valuation, Financial Engineering and Tax Services.

Revenues

Revenues excluding reimbursable expenses decreased $3,074 or 3.2% to $93,240, compared to $96,314 for the three months ended September 30, 2008. As summarized in the following table, the decrease in revenues primarily resulted from a 11.4% decrease in revenues attributable to our Financial Advisory segment. These decreases were partially offset by a 14.7% increase in revenues provided by our Corporate Finance Consulting segment and a 12.9% increase from our Investment Banking segment.

	Three Months Ended
	September 30,		September 30,		Dollar			Percent
	2009		2008		Change			Change
Financial Advisory
Valuation Advisory	$	29,692	$	43,777	$	(14,085	)		-32.2	%
Tax Services		15,045		12,700		2,345			18.5	%
Dispute & Legal Management Consulting		12,897		8,545		4,352			50.9	%
		57,634		65,022		(7,388	)		-11.4	%

Corporate Finance Consulting
Portfolio Valuation		5,858		5,010		848			16.9	%
Financial Engineering		5,201		3,068		2,133			69.5	%
Strategic Value Advisory		4,034		3,315		719			21.7	%
Due Diligence		2,352		3,818		(1,466	)		-38.4	%
		17,445		15,211		2,234			14.7	%

Investment Banking
Global Restructuring Advisory		11,038		4,825		6,213			128.8	%
Transaction Opinions		2,714		6,367		(3,653	)		-57.4	%
M&A Advisory		4,409		4,889		(480	)		-9.8	%
		18,161		16,081		2,080			12.9	%

Total revenues (excluding reimbursables)	$	93,240	$	96,314	$	(3,074	)		-3.2	%

Services within each of our segments were impacted by the general economic environment which led to a substantially lower volume of M&A and real estate transactions and a corresponding decline in revenues from services associated with Valuation Advisory, Transaction Opinions, Due Diligence and M&A Advisory. These decreases were partially offset primarily by increases in revenues from services associated with Global Restructuring Advisory, Dispute & Legal Management Consulting, Financial Engineering and to a lesser extent other Corporate Finance Consulting services.

Our client service headcount decreased to 902 client service professionals at September 30, 2009 from 975 client service professionals at December 31, 2008. This decrease resulted from targeted reductions and attrition, partially offset by limited hiring of professionals in areas which we have targeted for investment.

Direct Client Service Costs

Direct client service costs decreased $4,000 or 6.4% to $58,709 for the three months ended September 30, 2009, compared to $62,709 for the three months ended September 30, 2008. Direct client services costs include compensation and benefits and other direct client service costs. Other direct client service costs include fees payable to contractors and other expenses related to engagements. The following table adjusts direct client service costs for equity-based compensation associated with Legacy Units and IPO Options, acquisition retention expenses and reimbursable expenses.

Direct Client Service Costs

(Dollars in thousands)

	Three Months Ended
	September 30,			September 30,
	2009			2008

Revenues (excluding reimbursables)	$	93,240		$	96,314

Total direct client service costs	$	58,709		$	62,709
Less: equity-based compensation associated
with Legacy Units and IPO Options		(2,124	)		(6,585	)
Less: acquisition retention expenses		-			(206	)
Less: reimbursable expenses		(3,468	)		(2,813	)
Direct client service costs, as adjusted	$	53,117		$	53,105

Direct client service costs, as adjusted,
as a percentage of revenues		57.0	%		55.1	%

The slight increase in direct client service costs, as adjusted, primarily resulted from an increase in expense from accrued compensation and grants of Ongoing RSAs, offset by lower compensation from the reduction of headcount between periods.

Equity-based compensation 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, partially offset by an increase in expense from grants of Ongoing RSAs. Expenses related to retention payments associated with the acquisition of the CVC business in 2005 decreased as a result of the completion of the payments in 2008. CVC represents the Corporate Value Consulting business (“CVC”) which we acquired in 2005 from the Standard & Poor’s division of The McGraw-Hill Companies, Inc.

Operating Expenses

Operating expenses decreased $4,770 or 14.9% to $27,214 for the three months ended September 30, 2009, compared to $31,984 for the three months ended September 30, 2008. The following table adjusts operating expenses for depreciation and amortization and equity-based compensation associated with Legacy Units and IPO Options.

Operating Expenses

(Dollars in thousands)

	Three Months Ended
	September 30,			September 30,
	2009			2008

Revenues (excluding reimbursables)	$	93,240		$	96,314

Total operating expenses	$	27,214		$	31,984
Less: equity-based compensation associated
with Legacy Units and IPO Options		(1,105	)		(2,120	)
Less: depreciation and amortization		(2,594	)		(2,446	)
Operating expenses, as adjusted	$	23,515		$	27,418

Operating expenses, as adjusted,
as a percentage of revenues		25.2	%		28.5	%

The decrease in operating expenses, as adjusted, resulted from lower costs related to professional and practice development. In particular, last year’s quarter included the costs of a firm-wide management conference which focused on sales, marketing and collaboration within the Company.

Other Income and Expenses

Provision for Income Taxes

The provision for income taxes was $2,999 or 28.3% of income before income taxes for the three months ended September 30, 2009, compared to $1,348 or 36.8% of income before income taxes for the three months ended September 30, 2008. The U.S. statutory income tax rate of 35% was 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.

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 majority 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 40.2% and 60.7% for the three months ended September 30, 2009 and 2008, respectively.

Segment Results – Three months ended September 30, 2009 versus three months ended September 30, 2008

The following table sets forth selected segment operating results:

Results of Operations by Segment

(In thousands, except headcount and rate-per-hour)

	Three Months Ended
	September 30,			September 30,			Unit			Percent
	2009			2008			Change			Change
Financial Advisory
Revenues (excluding reimbursables)	$	57,634		$	65,022		$	(7,388	)		-11.4	%
Segment operating income	$	8,855		$	8,717		$	138			1.6	%
Segment operating income margin		15.4	%		13.4	%		2.0	%		14.6	%

Corporate Finance Consulting
Revenues (excluding reimbursables)	$	17,445		$	15,211		$	2,234			14.7	%
Segment operating income	$	5,389		$	3,080		$	2,309			75.0	%
Segment operating income margin		30.9	%		20.2	%		10.6	%		52.6	%

Investment Banking
Revenues (excluding reimbursables)	$	18,161		$	16,081		$	2,080			12.9	%
Segment operating income	$	2,364		$	3,994		$	(1,630	)		-40.8	%
Segment operating income margin		13.0	%		24.8	%		-11.8	%		-47.6	%

Total
Revenues (excluding reimbursables)	$	93,240		$	96,314

Segment operating income	$	16,608		$	15,791
Net client reimbursable expenses		(74	)		(32	)
Equity-based compensation from Legacy Units and IPO Options		(3,229	)		(8,705	)
Depreciation and amortization		(2,594	)		(2,446	)
Acquisition retention expenses		-			(206	)
Operating income	$	10,711		$	4,402

Average Client Service Professionals
Financial Advisory		642			701			(59	)		-8.4	%
Corporate Finance Consulting		133			137			(4	)		-2.9	%
Investment Banking		130			125			5			4.0	%
Total		905			963			(58	)		-6.0	%

End of Period Client Service Professionals
Financial Advisory		641			722			(81	)		-11.2	%
Corporate Finance Consulting		131			142			(11	)		-7.7	%
Investment Banking		130			129			1			0.8	%
Total		902			993			(91	)		-9.2	%

Revenue per Client Service Professional
Financial Advisory	$	90		$	93		$	(3	)		-3.2	%
Corporate Finance Consulting	$	131		$	111		$	20			18.0	%
Investment Banking	$	140		$	129		$	11			8.5	%
Total	$	103		$	100		$	3			3.0	%

Results of Operations by Segment – Continued

(In thousands, except headcount and rate-per-hour)

	Three Months Ended
	September 30,			September 30,			Unit			Percent
	2009			2008			Change			Change
Utilization(1)
Financial Advisory		62.4	%		62.7	%		-0.3	%		-0.5	%
Corporate Finance Consulting		70.0	%		54.6	%		15.4	%		28.2	%

Rate-Per-Hour(2)
Financial Advisory	$	336		$	334		$	2			0.6	%
Corporate Finance Consulting	$	402		$	431		$	(29	)		-6.7	%

Revenues (excluding reimbursables)
Financial Advisory	$	57,634		$	65,022		$	(7,388	)		-11.4	%
Corporate Finance Consulting		17,445			15,211			2,234			14.7	%
Investment Banking		18,161			16,081			2,080			12.9	%
Total	$	93,240		$	96,314		$	(3,074	)		-3.2	%

Average Number of Managing Directors
Financial Advisory		95			103			(8	)		-7.8	%
Corporate Finance Consulting		31			28			3			10.7	%
Investment Banking		40			33			7			21.2	%
Total		166			164			2			1.2	%

End of Period Managing Directors
Financial Advisory		93			105			(12	)		-11.4	%
Corporate Finance Consulting		29			29			-			0.0	%
Investment Banking		40			34			6			17.6	%
Total		162			168			(6	)		-3.6	%

Revenue per Managing Director
Financial Advisory	$	607		$	631		$	(24	)		-3.8	%
Corporate Finance Consulting	$	563		$	543		$	20			3.7	%
Investment Banking	$	454		$	487		$	(33	)		-6.8	%
Total	$	562		$	587		$	(25	)		-4.3	%

(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 & Associate, L.P. (“Rash”), a wholly-owned subsidiary of the Company, 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 $2,743 and $2,975 of revenues associated with Rash in the three months ended September 30, 2009 and 2008, respectively.

Financial Advisory

Revenues

Revenues from the Financial Advisory segment decreased $7,388 or 11.4% to $57,634 for the three months ended September 30, 2009, compared to $65,022 for the three months ended September 30, 2008. The decrease in revenues resulted from our Valuation Advisory business, partially offset by continued growth in revenues from our Dispute & Legal Management Consulting and Tax Services businesses, as summarized in the following table:

	Three Months Ended
	September 30,		September 30,		Dollar			Percent
	2009		2008		Change			Change
Financial Advisory
Valuation Advisory	$	29,692	$	43,777	$	(14,085	)		-32.2	%
Tax Services		15,045		12,700		2,345			18.5	%
Dispute & Legal Management Consulting		12,897		8,545		4,352			50.9	%
	$	57,634	$	65,022	$	(7,388	)		-11.4	%

The decrease in revenues from our Valuation Advisory business primarily resulted from reduced demand for services correlated to the volume of M&A transactions and the general economic environment, including real estate valuations and purchase price allocations pursuant to FASB ASC 805-20, Business Combinations (formerly SFAS 141(R)). These decreases were partially offset by increases in revenue from goodwill impairment testing in conjunction with FASB ASC 350-20, Intangibles – Goodwill and Other (formerly SFAS 142). The increase in revenues from our Dispute & Legal Management Consulting business primarily resulted from an engagement to serve as a financial advisor to the court appointed examiner of a large financial services company under bankruptcy protection. We expect this engagement to wind down early next year. The increase in revenues from Tax Services primarily resulted from continued growth in property tax services, the addition of professionals in our transactional tax advisory practice during the latter half of 2008, and an increase in revenues recognized from engagements where revenue is contingent upon tax savings achieved for our clients.

Segment Operating Income

Although Financial Advisory revenues decreased between periods, segment operating income increased $138 or 1.6% to $8,855 for the three months ended September 30, 2009, compared to $8,717 for the three months ended September 30, 2008. Segment operating income margin, defined as segment operating income expressed as a percentage of segment revenues, was 15.4% for the three months ended September 30, 2009, compared to 13.4% for the three months ended September 30, 2008. The improvement in segment operating margin primarily resulted from lower accrued compensation as a result of the decrease in revenues and average headcount between periods.

Corporate Finance Consulting

Revenues

Revenues from the Corporate Finance Consulting segment increased $2,234 or 14.7% to $17,445 for the three months ended September 30, 2009, compared to $15,211 for the three months ended September 30, 2008. The increase in revenues was driven by demand for Portfolio Valuation, Financial Engineering and Strategic Value services, partially offset by reduced demand for Due Diligence services, as summarized in the following table:

	Three Months Ended
	September 30,		September 30,		Dollar			Percent
	2009		2008		Change			Change
Corporate Finance Consulting
Portfolio Valuation	$	5,858	$	5,010	$	848			16.9	%
Financial Engineering		5,201		3,068		2,133			69.5	%
Strategic Value Advisory		4,034		3,315		719			21.7	%
Due Diligence		2,352		3,818		(1,466	)		-38.4	%
	$	17,445	$	15,211	$	2,234			14.7	%

Portfolio Valuation, Financial Engineering and Strategic Value Advisory benefited from increased demand from existing clients as well as the addition of new clients. Financial Engineering also benefited from engagements sourced from Portfolio Valuation as well as the Financial Advisory segment, including the engagement to serve as a financial advisor to the court appointed examiner of a large financial services company under bankruptcy protection. The decrease in revenues from Due Diligence resulted from a lower volume of M&A transactions during the quarter.

Segment Operating Income

Operating income from the Corporate Finance Consulting segment increased $2,309 or 75.0% to $5,389 for the three months ended September 30, 2009, compared to $3,080 for the three months ended September 30, 2008. Segment operating income margin was 30.9% for the three months ended September 30, 2009, compared to 20.2% for the three months ended September 30, 2008. Improvements in segment operating income and margin primarily resulted from the increase in revenues.

Investment Banking

Revenues

Revenues from the Investment Banking segment increased $2,080 or 12.9% to $18,161 for the three months ended September 30, 2009, compared to $16,081 for the three months ended September 30, 2008. Increases in revenues from Global Restructuring Advisory, were partially offset by decreases in revenues from Transaction Opinions and M&A Advisory, as summarized in the following table:

	Three Months Ended
	September 30,		September 30,		Dollar			Percent
	2009		2008		Change			Change
Investment Banking
Global Restructuring Advisory	$	11,038	$	4,825	$	6,213			128.8	%
Transaction Opinions		2,714		6,367		(3,653	)		-57.4	%
M&A Advisory		4,409		4,889		(480	)		-9.8	%
	$	18,161	$	16,081	$	2,080			12.9	%

Global Restructuring Advisory benefited from an increase in demand for our domestic restructuring services. Revenues from Transaction Opinions and M&A Advisory decreased as a result of the current economic landscape and a lower volume of M&A transactions.

Segment Operating Income

Operating income from the Investment Banking segment decreased $1,630 or 40.8% to $2,364 for the three months ended September 30, 2009, compared to $3,994 for the three months ended September 30, 2008. Operating income margin was 13.0% for the three months ended September 30, 2009, compared to 24.8% for the three months ended September 30, 2008. The decrease in segment operating income and margin primarily resulted from higher compensation expense which resulted in part from the hiring of new managing directors to enhance our position in the marketplace.

Nine months ended September 30, 2009 versus nine months ended September 30, 2008

The results of operations are summarized as follows:

Results of Operations

(Dollars in thousands)

	Nine Months Ended
	September 30,			September 30,			Unit			Percent
	2009			2008			Change			Change

Revenues	$	272,558		$	287,268		$	(14,710	)		(5.1	)%
Reimbursable expenses		8,057			7,946			111			1.4	%
Total revenues		280,615			295,214			(14,599	)		(4.9	)%

Direct client service costs
Compensation and benefits(1)		155,115			166,276			(11,161	)		(6.7	)%
Other direct client service costs		5,801			5,828			(27	)		(0.5	)%
Acquisition retention expenses		-			782			(782	)		(100.0	)%
Reimbursable expenses		8,120			7,926			194			2.4	%
		169,036			180,812			(11,776	)		(6.5	)%

Operating expenses
Selling, general and administrative(2)		74,048			83,301			(9,253	)		(11.1	)%
Depreciation and amortization		7,712			6,903			809			11.7	%
		81,760			90,204			(8,444	)		(9.4	)%

Operating income		29,819			24,198			5,621			23.2	%

Other expense/(income)
Interest income		(34	)		(654	)		620			(94.8	)%
Interest expense		1,079			2,569			(1,490	)		(58.0	)%
Loss on early extinguishment of debt		1,737			-			1,737			N/A
Other expense		137			(92	)		229			(248.9	)%
		2,919			1,823			1,096			60.1	%

Income before income taxes		26,900			22,375			4,525			20.2	%

Provision for income taxes		7,532			6,343			1,189			18.7	%

Net income		19,368			16,032			3,336			20.8	%

Less: Net income attributable to the noncontrolling interest		12,417			13,204			(787	)		(6.0	)%

Net income attributable to Duff & Phelps Corporation	$	6,951		$	2,828		$	4,123			145.8	%

Other financial and operating data

Adjusted EBITDA(3)	$	48,494		$	52,904		$	(4,410	)		(8.3	)%

Adjusted EBITDA(3) as a percentage of revenues		17.8	%		18.4	%		-0.6	%		(3.4	)%

End of period managing directors		162			168			(6	)		(3.6	)%

End of period client service professionals		902			993			(91	)		(9.2	)%

(1)	Compensation and benefits include $13,631 and $17,182 of equity-based compensation expense for the nine months ended September 30, 2009 and 2008, respectively.

(2)	Selling, general and administrative expenses include $5,574 and $8,164 of equity-based compensation expense for the nine months ended September 30, 2009 and 2008, respectively.

(3)	Adjusted EBITDA is a non-GAAP financial measure and is calculated as follows:

Reconciliation of Adjusted EBITDA
(Dollars in thousands)
	Nine Months Ended
	September 30,			September 30,
	2009			2008
Revenues (excluding client reimbursables)	$	272,558		$	287,268

Net income attributable to Duff & Phelps Corporation	$	6,951		$	2,828
Net income attributable to noncontrolling interest		12,417			13,204
Provision for income taxes		7,532			6,343
Other expense/(income), net		2,919			1,823
Depreciation and amortization		7,712			6,903
Equity-based compensation associated with Legacy Units and IPO Options		10,963			21,021
Acquisition retention expenses		-			782

Adjusted EBITDA	$	48,494		$	52,904

Adjusted EBITDA as a percentage of revenues		17.8	%		18.4	%

Overview

The current economic landscape continues to present us with opportunities and challenges. While our service offerings generally correlated to the volume of M&A transactions continue to experience reduced demand, growth in other business units partially offset this reduction with opportunities arising from counter-cyclical and non-cyclical services. Services we believe to be generally counter-cyclical include our global restructuring services, dispute and legal management consulting, and goodwill impairment testing in conjunction with FASB ASC 350-20, Intangibles – Goodwill and Other (formerly SFAS 142). Services we believe to be generally non-cyclical include portfolio valuation, financial engineering and tax services.

Revenues

Revenues excluding reimbursable expenses decreased $14,710 or 5.1% to $272,558, compared to $287,268 for the nine months ended September 30, 2008. The decrease in revenues primarily resulted from a 8.1% decrease in revenues from our Financial Advisory segment and 6.2% decrease in revenues attributable to our Investment Banking segment. These decreases were partially offset by a 9.3% increase in revenues provided by our Corporate Finance Consulting segment, as summarized in the following table:

	Nine Months Ended
	September 30,		September 30,		Dollar			Percent
	2009		2008		Change			Change
Financial Advisory
Valuation Advisory	$	103,834	$	136,337	$	(32,503	)		-23.8	%
Tax Services		37,895		33,441		4,454			13.3	%
Dispute & Legal Management Consulting		34,702		22,141		12,561			56.7	%
		176,431		191,919		(15,488	)		-8.1	%

Corporate Finance Consulting
Portfolio Valuation		16,491		11,632		4,859			41.8	%
Financial Engineering		14,508		10,657		3,851			36.1	%
Strategic Value Advisory		10,242		8,879		1,363			15.4	%
Due Diligence		5,798		11,868		(6,070	)		-51.1	%
		47,039		43,036		4,003			9.3	%

Investment Banking
Global Restructuring Advisory		25,230		11,706		13,524			115.5	%
Transaction Opinions		14,995		27,373		(12,378	)		-45.2	%
M&A Advisory		8,863		13,234		(4,371	)		-33.0	%
		49,088		52,313		(3,225	)		-6.2	%

Total revenues (excluding reimbursables)	$	272,558	$	287,268	$	(14,710	)		-5.1	%

Services within each of our segments were impacted by the general economic environment which led to a substantially lower volume of M&A and real estate transactions and a corresponding decline in revenues from services associated with Valuation Advisory, Transaction Opinions, Due Diligence and M&A Advisory. These decreases were partially offset primarily by increases in revenues from services associated with Global Restructuring, Dispute & Legal Management Consulting, Portfolio Valuation and Financial Engineering services.

Direct Client Service Costs

Direct client service costs decreased $11,776 or 6.5% to $169,036 for the nine months ended September 30, 2009, compared to $180,812 for the nine months ended September 30, 2008. Direct client services costs include compensation and benefits and other direct client service costs. Other direct client service costs include fees payable to contractors and other expenses related to engagements. The following table adjusts direct client service costs for equity-based compensation associated with Legacy Units and IPO Options, acquisition retention expenses and reimbursable expenses. Adjusted direct client service costs decreased between periods as a result of a concerted effort to control expenses.

Direct Client Service Costs
(Dollars in thousands)

	Nine Months Ended
	September 30,			September 30,
	2009			2008

Revenues (excluding reimbursables)	$	272,558		$	287,268

Total direct client service costs	$	169,036		$	180,812
Less: equity-based compensation associated
with Legacy Units and IPO Options		(8,004	)		(15,091	)
Less: acquisition retention expenses		-			(782	)
Less: reimbursable expenses		(8,120	)		(7,926	)
Direct client service costs, as adjusted	$	152,912		$	157,013

Direct client service costs, as adjusted,
as a percentage of revenues		56.1	%		54.7	%

The decrease in direct client service costs, as adjusted, resulted from lower accrued and other compensation costs, primarily as a result of the decline in revenues between periods and a reduction of recruiting activity in the current year. Lower accrued compensation was partially offset by higher salary costs and an increase in expense from grants of Ongoing RSAs. Salary costs were higher as a result of an increase in average client service professionals between periods.

Equity-based compensation 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, partially offset by changes in estimates of forfeiture rates and an increase in expense from grants of Ongoing RSAs. Expenses related to retention payments associated with the acquisition of the CVC business in 2005 decreased as a result of the completion of the payments in 2008. CVC represents the Corporate Value Consulting business (“CVC”) which we acquired in 2005 from the Standard & Poor’s division of The McGraw-Hill Companies, Inc.

Operating Expenses

Operating expenses decreased $8,444 or 9.4% to $81,760 for the nine months ended September 30, 2009, compared to $90,204 for the nine months ended September 30, 2008. The following table adjusts operating expenses for depreciation and amortization and equity-based compensation associated with Legacy Units and IPO Options.

Operating Expenses
(Dollars in thousands)

	Nine Months Ended
	September 30,			September 30,
	2009			2008

Revenues (excluding reimbursables)	$	272,558		$	287,268

Total operating expenses	$	81,760		$	90,204
Less: equity-based compensation associated
with Legacy Units and IPO Options		(2,959	)		(5,930	)
Less: depreciation and amortization		(7,712	)		(6,903	)
Operating expenses, as adjusted	$	71,089		$	77,371

Operating expenses, as adjusted,
as a percentage of revenues		26.1	%		26.9	%

The decrease in operating expenses, as adjusted, resulted from lower professional and practice development expenses, lower recruiting costs from a decline in hiring activity and lower accrued compensation primarily as a result of the decline in revenues between periods, partially offset by higher professional fees and other general expenses.

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 GE Capital Corporation. The termination of our former credit facility resulted in a $1,737 early extinguishment charge of which $1,674 was non-cash.

Provision for Income Taxes

The provision for income taxes was $7,532 or 28.0% of income before income taxes for the nine months ended September 30, 2009, compared to $6,343 or 28.3% of income before income taxes for the nine months ended September 30, 2008. The U.S. statutory income tax rate of 35% was 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.

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 majority 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 47.9% and 59.4% for the nine months ended September 30, 2009 and 2008, respectively.

Segment Results – Nine months ended September 30, 2009 versus nine months ended September 30, 2008

The following table sets forth selected segment operating results:

Results of Operations by Segment

(In thousands, except headcount and rate-per-hour)

	Nine Months Ended
	September 30,			September 30,			Unit			Percent
	2009			2008			Change			Change
Financial Advisory
Revenues (excluding reimbursables)	$	176,431		$	191,919		$	(15,488	)		-8.1	%
Segment operating income	$	29,543		$	29,627		$	(84	)		-0.3	%
Segment operating income margin		16.7	%		15.4	%		1.3	%		8.5	%

Corporate Finance Consulting
Revenues (excluding reimbursables)	$	47,039		$	43,036		$	4,003			9.3	%
Segment operating income	$	11,819		$	9,741		$	2,078			21.3	%
Segment operating income margin		25.1	%		22.6	%		2.5	%		11.0	%

Investment Banking
Revenues (excluding reimbursables)	$	49,088		$	52,313		$	(3,225	)		-6.2	%
Segment operating income	$	7,195		$	13,516		$	(6,321	)		-46.8	%
Segment operating income margin		14.7	%		25.8	%		-11.2	%		-43.3	%

Total
Revenues (excluding reimbursables)	$	272,558		$	287,268

Segment operating income	$	48,557		$	52,884
Net client reimbursable expenses		(63	)		20
Equity-based compensation from
Legacy Units and IPO Options		(10,963	)		(21,021	)
Depreciation and amortization		(7,712	)		(6,903	)
Acquisition retention expenses		-			(782	)
Operating income	$	29,819		$	24,198

Average Client Service Professionals
Financial Advisory		668			680			(12	)		-1.8	%
Corporate Finance Consulting		133			125			8			6.4	%
Investment Banking		134			115			19			16.5	%
Total		935			920			15			1.6	%

End of Period Client Service Professionals
Financial Advisory		641			722			(81	)		-11.2	%
Corporate Finance Consulting		131			142			(11	)		-7.7	%
Investment Banking		130			129			1			0.8	%
Total		902			993			(91	)		-9.2	%

Revenue per Client Service Professional
Financial Advisory	$	264		$	282		$	(18	)		-6.4	%
Corporate Finance Consulting	$	354		$	344		$	10			2.9	%
Investment Banking	$	366		$	455		$	(89	)		-19.6	%
Total	$	292		$	312		$	(20	)		-6.4	%

Results of Operations by Segment – Continued

(In thousands, except headcount and rate-per-hour)

	Nine Months Ended
	September 30,			September 30,			Unit			Percent
	2009			2008			Change			Change
Utilization(1)
Financial Advisory		64.0	%		63.2	%		0.8	%		1.3	%
Corporate Finance Consulting		62.0	%		59.0	%		3.0	%		5.1	%

Rate-Per-Hour(2)
Financial Advisory	$	322		$	341		$	(19	)		-5.6	%
Corporate Finance Consulting	$	407		$	395		$	12			3.0	%

Revenues (excluding reimbursables)
Financial Advisory	$	176,431		$	191,919		$	(15,488	)		-8.1	%
Corporate Finance Consulting		47,039			43,036			4,003			9.3	%
Investment Banking		49,088			52,313			(3,225	)		-6.2	%
Total	$	272,558		$	287,268		$	(14,710	) $		-5.1	%

Average Number of Managing Directors
Financial Advisory		98			94			4			4.3	%
Corporate Finance Consulting		30			24			6			25.0	%
Investment Banking		38			32			6			18.8	%
Total		166			150			16			10.7	%

End of Period Managing Directors
Financial Advisory		93			105			(12	)		-11.4	%
Corporate Finance Consulting		29			29			-			0.0	%
Investment Banking		40			34			6			17.6	%
Total		162			168			(6	)		-3.6	%

Revenue per Managing Director
Financial Advisory	$	1,800		$	2,042		$	(242	)		-11.9	%
Corporate Finance Consulting	$	1,568		$	1,793		$	(225	)		-12.5	%
Investment Banking	$	1,292		$	1,635		$	(343	)		-21.0	%
Total	$	1,642		$	1,915		$	(273	)		-14.3	%

(1)

(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 $7,065 and $6,914 of revenues associated with Rash in the nine months ended September 30, 2009 and 2008, respectively.

Financial Advisory

Revenues

Revenues from the Financial Advisory segment decreased $15,488 or 8.1% to $176,431 for the nine months ended September 30, 2009, compared to $191,919 for the nine months ended September 30, 2008. The decrease in revenues resulted from our Valuation Advisory business, partially offset by continued growth in revenues from our Dispute & Legal Management Consulting and Tax Services businesses, as summarized in the following table:

	Nine Months Ended
	September 30,		September 30,		Dollar			Percent
	2009		2008		Change			Change
Financial Advisory
Valuation Advisory	$	103,834	$	136,337	$	(32,503	)		-23.8	%
Tax Services		37,895		33,441		4,454			13.3	%
Dispute & Legal Management Consulting		34,702		22,141		12,561			56.7	%
	$	176,431	$	191,919	$	(15,488	)		-8.1	%

The decrease in revenues from our Valuation Advisory business primarily resulted from reduced demand for services correlated to the volume of M&A transactions, including real estate valuations and purchase price allocations pursuant to FASB ASC 805-20, Business Combinations (formerly SFAS 141(R)). These decreases were partially offset by increases in revenue from goodwill impairment testing in conjunction with FASB ASC 350-20, Intangibles – Goodwill and Other (formerly SFAS 142). The increase in revenues from our Dispute & Legal Management Consulting business primarily resulted from (i) an engagement to serve as a financial advisor to the court appointed examiner of a large financial services company under bankruptcy protection and (ii) incremental revenues from our acquisitions of the Lumin Expert Group and Dubinsky & Company, P.C. We expect the engagement for the court appointed examiner to wind down early next year. The increase in revenues from Tax Services primarily resulted from continued growth in property tax services, the addition of professionals in our transactional tax advisory practice during the latter half of 2008, and an increase in revenues recognized from engagements where revenue is contingent upon tax savings achieved for our clients.

Segment Operating Income

Financial Advisory segment operating income decreased $84 or 0.3% to $29,543 for the nine months ended September 30, 2009, compared to $29,627 for the nine months ended September 30, 2008. Segment operating income margin, defined as segment operating income expressed as a percentage of segment revenues, was 16.7% for the nine months ended September 30, 2009, compared to 15.4% for the nine months ended September 30, 2008. The improvement in segment operating margin primarily resulted from lower accrued compensation as a result of the decrease in revenues between periods.

Corporate Finance Consulting

Revenues

Revenues from the Corporate Finance Consulting segment increased $4,003 or 9.3% to $47,039 for the nine months ended September 30, 2009, compared to $43,036 for the nine months ended September 30, 2008. Growth was primarily driven by demand for services related to Portfolio Valuation, Financial Engineering and Strategic Value Advisory, partially offset by a decrease in revenues from Due Diligence, as summarized in the following table:

	Nine Months Ended
	September 30,		September 30,		Dollar			Percent
	2009		2008		Change			Change
Corporate Finance Consulting
Portfolio Valuation	$	16,491	$	11,632	$	4,859			41.8	%
Financial Engineering		14,508		10,657		3,851			36.1	%
Strategic Value Advisory		10,242		8,879		1,363			15.4	%
Due Diligence		5,798		11,868		(6,070	)		-51.1	%
	$	47,039	$	43,036	$	4,003			9.3	%

Segment Operating Income

Operating income from the Corporate Finance Consulting segment increased $2,078 or 21.3% to $11,819 for the nine months ended September 30, 2009, compared to $9,741 for the nine months ended September 30, 2008. Segment operating income margin was 25.1% for the nine months ended September 30, 2009, compared to 22.6% for the nine months ended September 30, 2008. Improvements in segment operating income and margin primarily resulted from the increase in revenues.

Investment Banking

Revenues

Revenues from the Investment Banking segment decreased $3,225 or 6.2% to $49,088 for the nine months ended September 30, 2009, compared to $52,313 for the nine months ended September 30, 2008, as summarized in the following table:

	Nine Months Ended
	September 30,		September 30,		Dollar			Percent
	2009		2008		Change			Change
Investment Banking
Global Restructuring Advisory	$	25,230	$	11,706	$	13,524			115.5	%
Transaction Opinions		14,995		27,373		(12,378	)		-45.2	%
M&A Advisory		8,863		13,234		(4,371	)		-33.0	%
	$	49,088	$	52,313	$	(3,225	)		-6.2	%

Revenues from Transaction Opinions and M&A Advisory decreased as a result of the current economic landscape and a lower volume of M&A transactions. Global Restructuring Advisory benefited from an increase in demand for our domestic and international restructuring services.

Segment Operating Income

Operating income from the Investment Banking segment decreased $6,321 or 46.8% to $7,195 for the nine months ended September 30, 2009, compared to $13,516 for the nine months ended September 30, 2008. Operating income margin was 14.7% for the nine months ended September 30, 2009, compared to 25.8% for the nine months ended September 30, 2008. The decrease in segment operating income and margin primarily resulted from higher compensation expense which resulted in part from the hiring of new managing directors to enhance our position in the marketplace.

Liquidity and Capital Resources

Our primary sources of liquidity are our existing non-restricted cash balances and availability under our revolving credit facility (see below). 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 professionals, (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 and (vii) funding of our deferred compensation program.

Cash and cash equivalents increased by $2,815 to $84,196 at September 30, 2009, compared to $81,381 at December 31, 2008. The increase in cash resulted from $29,681 provided by operating activities, partially offset by $17,088 used in financing activities and $11,214 used in investing activities.

Operating Activities

During the nine months ended September 30, 2009, cash of $29,681 was provided by operating activities, compared to $9,016 in the prior year period. The increase of amounts provided by operating activities primarily resulted from lower cash bonus payments made in 2009 with respect to the 2008 bonus year, as compared to cash bonus payments made in 2008 with respect to the 2007 bonus year, offset by lower bonus accruals in the current year, as compared to the prior year. Typically, we accrue performance bonuses during the course of the calendar year, therefore generating cash, which is used to fund bonus payments to our personnel early in the following year.

Investing Activities

During the nine months ended September 30, 2009, cash of $11,214 was used in investing activities, compared to $32,819 used in the prior year period. Investing activities during the current period included (i) purchases of property and equipment to support our business and (ii) purchases of investments related to the Company’s deferred compensation plan. Management believes these investments pose limited liquidity risk. Investing activities in the prior year include $16,427 used for acquisitions.

Financing Activities

During the nine months ended September 30, 2009, cash of $17,088 was used in financing activities, compared to $8,483 used in the prior year period. Significant financing activities are summarized as follows:

Net proceeds from sale of Class A common stock – On May 18, 2009, we consummated a follow-on offering with the sale of 8,050 newly issued shares of Class A common stock at $14.75 per share, less an underwriting discount of $0.7375 per share. Net proceeds totaled $111,808, as summarized in the following table (“May 2009 Follow-On Offering”):

Stock subscription of 7,000 shares at $14.75 per share	$	103,250
Over allotment of 1,050 shares at $14.75 per share		15,488
Underwriting discount of 8,050 shares at $0.7375 per share		(5,937	)
Offering related expenses		(993	)
Net proceeds	$	111,808

Redemption of noncontrolling unitholders – In conjunction with the follow-on offering, we used $67,112 of our net proceeds to redeem 3,500 New Class A Units of D&P Acquisitions held by entities affiliated with Lovell Minnick Partners and Vestar Capital Partners and 1,050 New Class A Units of D&P Acquisitions held by employees, including executive officers, directors and entities affiliated with our directors. Units were redeemed at a price per unit equal to the public offering price. In connection with the redemption, a corresponding number of shares of Class B common stock were also cancelled.

Repayments of debt – Repayments of debt totaled $42,763 and were used to repay all outstanding borrowings and terminate our credit agreement with General Electric Capital Corporation.

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

	Nine Months Ended
	September 30,		September 30,
	2009		2008
Distributions for taxes	$	14,197	$	7,888
Other distributions		1,313		-
Payments pursuant to the TaxReceivable Agreement		-		-
	$	15,510	$	7,888

Distributions for taxes

Other distributions

Payments pursuant to the Tax Receivable Agreement

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. There were no payments under the TRA in the nine months ended September 30, 2009 as these payments are typically made in the fourth quarter of each year. In December 2009, the Company expects to make payments under the TRA of $3,148. In December 2008, the Company made payments of $791 with respect to the period from October 4 through December 31, 2007. D&P Acquisitions expects to make future payments under the TRA to the extent cash is available for such purposes.

Within the next 12 month period, the Company expects to pay $3,148 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 with 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.

Increase in restricted cash – The increase in restricted cash resulted from $377 of deposits to secure certain letters of credit and $312 of deposits for the distribution of $0.05 per unvested unit to noncontrolling unitholders as described above.

Dividends – Cash dividends of $2,394 reflects the payment of a quarterly dividend of $0.05 per share on our outstanding Class A common stock, including holders of restricted stock awards.

Repurchases of Class A common stock – Repurchases of Class A common stock represents shares of Class A common stock withheld to cover payroll tax withholdings related to the lapse of restrictions on Ongoing RSAs. These shares were not part of a publicly announced repurchase program.

Credit Facility

The Company used a portion of the net proceeds from its May 2009 Follow-On Offering to repay all amounts outstanding under the Former Credit Facility. In connection with the repayment, the Company incurred a nonrecurring charge of $1,737 to reflect the accelerated amortization of the debt discount and issuance costs of which $1,674 was non-cash.

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 new revolving credit agreement. We believe these funds will be adequate to fund future growth.

Item 3.

Quantitative and Qualitative Disclosures About Market Risk.

Market risks at September 30, 2009 have not changed significantly from those discussed in Item 7A of our Annual Report on Form 10-K for the year ended December 31, 2008, as filed with the SEC on February 26, 2009.

Item4.

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.

PART II

OTHER INFORMATION

Item1.

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.

Item1A.

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, 2008, as filed with the SEC on February 26, 2009.

Item2.

Unregistered Sales of Equity Securities and Use of Proceeds.

Issuer Purchases of Equity Securities

During the third quarter of 2009, we withheld shares of our Class A common stock from holders of Ongoing RSAs to satisfy the holders’ tax liabilities in connection with the lapse of restrictions on such shares, as summarized in the following table:

	Total
	Number of		Average
	Shares		Price Paid
Class A Common Stock	Purchased		Per Share
	(In thousands)
July 1 through July 31, 2009		3	$	18.52
August 1 through August 31, 2009		-		-
September 1 through September 30, 2009		2		17.27
Total		5	$	18.02

The total number of shares purchased represents shares of Class A common stock withheld to cover payroll tax withholdings related to the lapse of restrictions on Ongoing RSAs. These shares were not part of a publicly announced repurchase program and were retired upon purchase.

Item 3.

Defaults Upon Senior Securities.

None.

Item 4.

Submission of Matters to a Vote of Security Holders.

None.

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.

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: November 3, 2009	/s/ Jacob L. Silverman
	JACOB L. SILVERMAN
	Chief Financial Officer

Attached files

Stock widget

Investing forum

Duff & Phelps Corp Reports

Also read