Note 14. Segment Disclosures

Our business units have been aggregated into three practice groups: Financial Services, Benefits and Insurance Services and National Practices. The business units have been aggregated based on the following factors: similarity of the products and services provided to clients; similarity of the regulatory environment in which they operate; and similarity of economic conditions affecting long-term performance. The business units are managed along these segment lines. A general description of services provided by each practice group is provided in the table below.

Financial Services

Benefits and Insurance Services

National Practices

• Accounting and Tax

• Government Healthcare Consulting

• Financial Advisory

• Valuation

• Risk & Advisory Services

• Group Health Benefits Consulting

• Payroll

• Property & Casualty

• Retirement Plan Services

• Managed Networking and Hardware Services

• Healthcare Consulting

Corporate and Other. Included in “Corporate and Other” are operating expenses that are not directly allocated to the individual business units. These expenses are primarily comprised of certain health care costs, gains or losses attributable to assets held in the Company’s non-qualified deferred compensation plan, share-based compensation, consolidation and integration charges, certain professional fees, certain advertising costs and other various expenses.

Accounting policies of the practice groups are the same as those described in Note 1, Organization and Summary of Significant Accounting Policies, to the Annual Report on Form 10-K for the year ended December 31, 2016. Upon consolidation, intercompany accounts and transactions are eliminated, thus inter-segment revenue is not included in the measure of profit or loss for the practice groups. Performance of the practice groups is evaluated on operating income excluding those costs listed above, which are reported in the “Corporate and Other” segment.

Segment information for the three months ended September 30, 2017 and 2016 was as follows (in thousands):

	Three Months Ended September 30, 2017
	Financial Services		Benefits and Insurance Services			National Practices		Corporate and Other			Total
Revenue	$	130,305	$	69,663		$	7,755	$	—		$	207,723
Operating expenses		112,996		59,155			7,109		5,463			184,723
Gross margin		17,309		10,508			646		(5,463	)		23,000
Corporate general & admin		—		—			—		7,979			7,979
Operating income (loss)		17,309		10,508			646		(13,442	)		15,021
Other income (expense):
Interest expense		—		(10	)		—		(1,767	)		(1,777	)
Other income, net		79		82			—		2,631			2,792
Total other income		79		72			—		864			1,015
Income (loss) from continuing operations before income tax expense	$	17,388	$	10,580		$	646	$	(12,578	)	$	16,036

	Three Months Ended September 30, 2016
	Financial Services		Benefits and Insurance Services			National Practices		Corporate and Other			Total
Revenue	$	123,049	$	68,979		$	7,766	$	—		$	199,794
Operating expenses		105,615		57,627			6,895		3,932			174,069
Gross margin		17,434		11,352			871		(3,932	)		25,725
Corporate general & admin		—		—			—		8,679			8,679
Operating income (loss)		17,434		11,352			871		(12,611	)		17,046
Other income (expense):
Interest expense		—		(12	)		—		(1,748	)		(1,760	)
Gain on sale of operations, net		—		—			—		329			329
Other income, net		10		62			1		2,559			2,632
Total other income		10		50			1		1,140			1,201
Income (loss) from continuing operations before income tax expense	$	17,444	$	11,402		$	872	$	(11,471	)	$	18,247

Segment information for the nine months ended September 30, 2017 and 2016 was as follows (in thousands):

	Nine Months Ended September 30, 2017
	Financial Services		Benefits and Insurance Services			National Practices			Corporate and Other			Total
Revenue	$	421,529	$	215,386		$	23,283		$	—		$	660,198
Operating expenses		348,236		179,174			21,351			16,848			565,609
Gross margin		73,293		36,212			1,932			(16,848	)		94,589
Corporate general & admin		—		—			—			25,979			25,979
Operating income (loss)		73,293		36,212			1,932			(42,827	)		68,610
Other income (expense):
Interest expense		—		(30	)		—			(4,956	)		(4,986	)
Gain on sale of operations, net		—		—			—			45			45
Other income (expense), net		122		298			(9	)		8,882			9,293
Total other income (expense)		122		268			(9	)		3,971			4,352
Income (loss) from continuing operations before income tax expense	$	73,415	$	36,480		$	1,923		$	(38,856	)	$	72,962

	Nine Months Ended September 30, 2016
	Financial Services		Benefits and Insurance Services			National Practices		Corporate and Other			Total
Revenue	$	398,112	$	199,790		$	23,145	$	—		$	621,047
Operating expenses		326,099		167,651			20,777		11,655			526,182
Gross margin		72,013		32,139			2,368		(11,655	)		94,865
Corporate general & admin		—		—			—		27,270			27,270
Operating income (loss)		72,013		32,139			2,368		(38,925	)		67,595
Other income (expense):
Interest expense		—		(32	)		—		(4,987	)		(5,019	)
Gain on sale of operations, net		—		—			—		480			480
Other income, net		237		220			2		5,023			5,482
Total other income		237		188			2		516			943
Income (loss) from continuing operations before income tax expense	$	72,250	$	32,327		$	2,370	$	(38,409	)	$	68,538