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Related Party Transactions | 12 Months Ended
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Mar. 31, 2020
Related Party Transactions [Abstract] |
Related Party Transactions | Note 20. Related Party Transactions As set forth in the Company’s Audit Committee Charter and consistent with NASDAQ Listing Rules, our Audit Committee (the “Audit Committee”) reviews and maintains oversight over related party transactions which are required to be disclosed under the Securities and Exchange Commission (“SEC”) rules and regulations and in accordance with GAAP. Accordingly, all such related party transactions are submitted to the Audit Committee for ongoing review and oversight. Our internal processes are designed to ensure that our legal and finance departments identify and monitor potential related party transactions that may require disclosure and Audit Committee oversight. AMERCO has engaged in related party transactions and has continuing related party interests with certain major stockholders, directors and officers of the consolidated group as disclosed below. SAC Holding Corporation and SAC Holding II Corporation (collectively “SAC Holdings”) were established in order to acquire and develop self-storage properties. These properties are being managed by us pursuant to management agreements. In the past, we sold real estate and various self-storage properties to SAC Holdings, and such sales provided significant cash flows to us. SAC Holdings, Four SAC Self-Storage Corporation, Five SAC Self-Storage Corporation, Galaxy Investments, L.P. and 2015 SAC self-storage are substantially controlled by Blackwater Investments, Inc. (“Blackwater”). Blackwater is wholly owned by Willow Grove Holdings LP, which is owned by Mark V. Shoen (a significant stockholder), and various trusts associated with Edward J. Shoen (our Chairman of the Board, President and a significant stockholder) and Mark V. Shoen. F- 43 amerco and consolidated subsidiaries notes to consolidated financial statements – (continued) Related Party Revenues Years Ended March 31, 2020 2019 2018 (In thousands) U-Haul interest income revenue from Blackwater $ – $ – $ 3,326 U-Haul management fee revenue from Blackwater 24,014 23,986 23,577 U-Haul management fee revenue from Mercury 6,392 5,162 6,025 $ 30,406 $ 29,148 $ 32,928 We currently manage the self-storage properties owned or leased by Blackwater and Mercury Partners, L.P. (“Mercury”), pursuant to a standard form of management agreement, under which we receive a management fee of between 4 % and 10 % of the gross receipts plus reimbursement for certain expenses. We received management fees, exclusive of reimbursed expenses, of $ 29.0 million, $ 30.0 million and $ 29.5 million from the above-mentioned entities during fiscal 2020, 2019 and 2018, respectively. This management fee is consistent with the fee received for other properties we previously managed for third parties. Mark V. Shoen controls the general partner of Mercury. The limited partner interests of Mercury are owned indirectly by James P. Shoen and various trusts benefitting Edward J. Shoen and James P. Shoen or their descendants. Mercury holds the option to purchase a portfolio of properties currently leased by Mercury and a U-Haul subsidiary, which option is exercisable in 2024. Related Party Costs and Expenses Years Ended March 31, 2020 2019 2018 (In thousands) U-Haul lease expenses to Blackwater $ 2,631 $ 2,678 $ 2,684 U-Haul commission expenses to Blackwater 62,066 61,434 58,595 $ 64,697 $ 64,112 $ 61,279 We lease space for marketing company offices, vehicle repair shops and hitch installation centers from subsidiaries of Blackwater. The terms of the leases are similar to the terms of leases for other properties owned by unrelated parties that are leased to us. As of March 31, 2020, subsidiaries of Blackwater acted as U-Haul independent dealers. The financial and other terms of the dealership contracts with the aforementioned companies and their subsidiaries are substantially identical to the terms of those with our other independent dealers whereby commissions are paid by us based upon equipment rental revenues. These agreements and notes with subsidiaries of Blackwater, excluding Dealer Agreements, provided revenues of $ 24.0 million, expenses of $ 2.6 million and cash flows of $ 21.5 million during fiscal 2020. Revenues and commission expenses related to the Dealer Agreements were $ 293.6 million and $ 62.1 million, respectively for fiscal 2020. In December 2019, Real Estate completed the sale of two office buildings to Oxford at cost for approximately $ 15.0 million. Oxford assumed the debt securing the property of $ 11.5 million and paid the balance in cash. There were no gains on this transaction. Management determined that we do not have a variable interest pursuant to the VIE model under ASC 810 in the holding entities of Blackwater based upon management agreements which are with the individual operating entities; therefore, we are precluded from consolidating these entities. F- 44 amerco and consolidated subsidiaries notes to consolidated financial statements – (continued) Related Party Assets March 31, 2020 2019 (In thousands) U-Haul receivable from Blackwater $ 25,293 $ 25,158 U-Haul receivable from Mercury 9,893 7,234 Other (a) (402) (1,503) $ 34,784 $ 30,889 (a) Timing differences for intercompany balances with insurance subsidiaries resulting from the three month difference in reporting periods. Note 21. Statutory Financial Information of Insurance Subsidiaries Applicable laws and regulations of the States of Arizona and Nevada require Property and Casualty Insurance and Life Insurance to maintain minimum capital and surplus determined in accordance with statutory accounting principles. Audited statutory net income and statutory capital and surplus for the years ended are listed below: Years Ended December 31, 2019 2018 2017 (In thousands) Repwest: Audited statutory net income $ 28,614 $ 23,960 $ 16,328 Audited statutory capital and surplus 226,999 216,763 197,375 ARCOA: Audited statutory net income 2,906 1,612 1,190 Audited statutory capital and surplus 12,851 9,390 7,991 Oxford: Audited statutory net income 18,599 11,367 10,350 Audited statutory capital and surplus 223,264 203,723 195,931 CFLIC: Audited statutory net income 8,043 8,735 8,062 Audited statutory capital and surplus 26,305 27,232 26,653 NAI: Audited statutory net income 1,942 1,436 1,594 Audited statutory capital and surplus 13,371 12,817 12,674 The amount of dividends that can be paid to shareholders by insurance companies domiciled in the State of Arizona is limited. There are restrictions on the ability of our insurance subsidiaries to transfer funds to us in the form of cash dividends, loans or advances. Their ordinary dividends are limited to the lower of 10% of prior year statutory surplus or prior year net income. Any extraordinary dividend, loans or advances to us from the insurance subsidiaries must be approved by the domiciliary insurance commissioner. Any dividend in excess of the limit requires prior regulatory approval. The statutory surplus for Repwest at December 31, 2019 that could be distributed as ordinary dividends was $ 22.7 million. The statutory surplus for Oxford at December 31, 2019 that could be distributed as ordinary dividends was $ 18.6 million. Repwest paid a dividend of $ 21.6 million to AMERCO during fiscal 2020. Repwest did not pay a dividend to AMERCO in fiscal 2019 or 2018. Oxford did not pay a dividend to AMERCO in fiscal 2020, 2019 or 2018, respectively. Restricted net assets for our insurance subsidiaries were $ 98.5 million and $ 130.2 million as of March 31, 2020 and 2019, respectively. F- 45

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- Definition The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 850 -URI http://asc.fasb.org/topic&trid=2122745 + Details
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