StepStone Group Inc.
For the period ended Mar 31, 2026. Filed May 27, 2026.
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FY2026 · Filed May 27, 2026
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Reports of Independent Registered Public Accounting Firm
Report of Independent Registered Public Accounting Firm
To the Stockholders and the Board of Directors of StepStone Group Inc.
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of StepStone Group Inc. (the Company) as of March 31, 2026 and 2025, the related consolidated statements of income (loss), comprehensive income (loss), stockholders’ equity and cash flows for each of the three years in the period ended March 31, 2026, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at March 31, 2026 and 2025, and the results of its operations and its cash flows for each of the three years in the period ended March 31, 2026, in conformity with U.S. generally accepted accounting principles.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of March 31, 2026, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated May 27, 2026 expressed an unqualified opinion thereon.
Basis for Opinion
These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matters
The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.
| Valuation of underlying investments of equity method investments | |
| Description of the Matter | The Company has investments in funds of $249.4 million and accrued carried interest allocations of $2,036.9 million as of March 31, 2026. As discussed in Notes 2 and 5 to the consolidated financial statements, a significant input to the measurement of the Company’s investments in funds and accrued carried interest allocations is management’s estimate of the fair value of investments held by the StepStone Funds, specifically investments that are valued using significant unobservable inputs classified as Level III within the fair value hierarchy. Auditing management’s determination of the fair value of Level III investments involved a high degree of auditor subjectivity because these investments exhibit higher estimation uncertainty. |
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| How We Addressed the Matter in Our Audit | We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the Company’s investment valuation process. This included management’s review controls over the assessment of the valuation techniques and significant unobservable inputs used to estimate the fair value and management’s review of the completeness and accuracy of the data used in these estimates.Our audit procedures included, among others, evaluating, on a sample basis, the valuation techniques and significant unobservable inputs used by the Company and testing the mathematical accuracy of the related valuation models.For example, for a sample of Level III fund investments, we performed procedures to evaluate the significant unobservable inputs such as the selected earnings before interest, taxes, depreciation and amortization multiples or revenue multiples that were derived from comparable companies. These procedures included assessing management’s determination of the comparable companies, and, where applicable, comparing the selected multiples to market observed transactions of such companies. We considered and evaluated information that corroborated or contradicted the significant unobservable inputs or concluded fair value. We also evaluated subsequent events and transactions and considered whether they corroborated or contradicted the year-end valuations.Finally, we involved more senior, more experienced audit team members to perform audit procedures related to Level III investments described above. |
| Valuation of liability classified awards | |
| Description of the Matter | As disclosed in Note 10 to the consolidated financial statements, the Company recognized $2,265.8 million, for liability classified awards within accrued compensation and benefits in the consolidated financial statements. As of March 31, 2026, the Company determined with the assistance of a third-party valuation specialist the fair value of the liability classified awards based on the contractual redemption price using significant unobservable inputs including projected earnings of StepStone Private Wealth LLC, a discount rate and an adjusted trading multiple.Auditing the Company’s fair value of the liability classified awards involved a high degree of subjectivity as the significant unobservable inputs used in the determination of fair value were based on assumptions about future market and economic conditions and could have a material effect on the fair value of the liability classified awards. |
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| How We Addressed the Matter in Our Audit | We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the Company’s valuation process for the liability classified awards. This included management’s review controls over the valuation methodology and significant assumptions used to estimate the fair value of the liability classified awards, and management’s review controls over the completeness and accuracy of the data used in the forecast and valuation model.Our audit procedures included, among others, evaluating the Company’s valuation methodology and significant inputs used to estimate the fair value of the liability classified awards and testing the mathematical accuracy of the Company’s valuation model. For example, we compared the significant unobservable inputs described above to current market and economic trends, the historical results of the business and performed sensitivity analyses of the significant inputs to evaluate contrary evidence and the change in the fair value estimate that would result from changes in the inputs. We tested the calculation of the contractual redemption price and verified the significant inputs used in the calculation were consistent with those prescribed in the related transaction agreements. We involved our valuation specialists to assist in our evaluation of the Company’s valuation methodology and certain significant unobservable inputs used in the fair value estimate, including the discount rate and adjusted trading multiple used in the Company’s valuation model. |
/s/Ernst & Young LLP
We have served as the Company's auditor since 2009.
New York, NY
May 27, 2026
Report of Independent Registered Public Accounting Firm
To the Stockholders and the Board of Directors of StepStone Group Inc.
Opinion on Internal Control Over Financial Reporting
We have audited StepStone Group Inc.’s internal control over financial reporting as of March 31, 2026, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). In our opinion, StepStone Group Inc. (the Company) maintained, in all material respects, effective internal control over financial reporting as of March 31, 2026, based on the COSO criteria.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of March 31, 2026 and 2025, the related consolidated statements of income (loss), comprehensive income (loss), stockholders’ equity and cash flows for each of the three years in the period ended March 31, 2026, and the related notes and our report dated May 27, 2026 expressed an unqualified opinion thereon.
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.
Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/ Ernst & Young LLP
New York, NY
May 27, 2026
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