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Segment Disclosures | 9 Months Ended
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Sep. 30, 2019
Segment Reporting [Abstract] |
Segment Disclosures | Note 16. 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 our 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. Basis of Presentation and Significant Accounting Policies, to the Annual Report on Form 10-K for the year ended December 31, 2018. 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 and nine months ended September 30, 2019 and 2018 is presented below. We do not manage our assets on a segment basis, therefore segment assets are not presented below.
|  | Three Months Ended September 30, 2019 |
|  | Financial Services |  |  | Benefits and Insurance Services |  |  | National Practices |  |  | Corporate and Other |  |  | Total |
Revenue |  | $ | 153,794 |  |  | $ | 76,960 |  |  | $ | 9,036 |  |  | $ | — |  |  | $ | 239,790 |
Operating expenses |  |  | 128,231 |  |  |  | 63,390 |  |  |  | 8,104 |  |  |  | 9,421 |  |  |  | 209,146 |
Gross margin |  |  | 25,563 |  |  |  | 13,570 |  |  |  | 932 |  |  |  | (9,421 | ) |  |  | 30,644 |
Corporate general & admin |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 11,670 |  |  |  | 11,670 |
Operating income (loss) |  |  | 25,563 |  |  |  | 13,570 |  |  |  | 932 |  |  |  | (21,091 | ) |  |  | 18,974 |
Other income (expense): |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest expense |  |  | — |  |  |  | (14 | ) |  |  | — |  |  |  | (1,507 | ) |  |  | (1,521 | )
Gain (loss) on sale of operations, net |  |  | 16 |  |  |  | — |  |  |  | — |  |  |  | (161 | ) |  |  | (145 | )
Other income, net |  |  | 14 |  |  |  | 9 |  |  |  | — |  |  |  | 6,744 |  |  |  | 6,767 |
Total other income (expense) |  |  | 30 |  |  |  | (5 | ) |  |  | — |  |  |  | 5,076 |  |  |  | 5,101 |
Income (loss) from continuing operations before income tax expense |  | $ | 25,593 |  |  | $ | 13,565 |  |  | $ | 932 |  |  | $ | (16,015 | ) |  | $ | 24,075 |
|  | Three Months Ended September 30, 2018 |
|  | Financial Services |  |  | Benefits and Insurance Services |  |  | National Practices |  |  | Corporate and Other |  |  | Total |
Revenue |  | $ | 146,145 |  |  | $ | 70,069 |  |  | $ | 8,035 |  |  | $ | — |  |  | $ | 224,249 |
Operating expenses |  |  | 124,546 |  |  |  | 59,399 |  |  |  | 7,514 |  |  |  | 7,148 |  |  |  | 198,607 |
Gross margin |  |  | 21,599 |  |  |  | 10,670 |  |  |  | 521 |  |  |  | (7,148 | ) |  |  | 25,642 |
Corporate general & admin |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 10,279 |  |  |  | 10,279 |
Operating income (loss) |  |  | 21,599 |  |  |  | 10,670 |  |  |  | 521 |  |  |  | (17,427 | ) |  |  | 15,363 |
Other (expense) income: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest expense |  |  | — |  |  |  | (7 | ) |  |  | — |  |  |  | (1,607 | ) |  |  | (1,614 | )
Other (expense) income, net |  |  | (142 | ) |  |  | 129 |  |  |  | — |  |  |  | 3,156 |  |  |  | 3,143 |
Total other (expense) income |  |  | (142 | ) |  |  | 122 |  |  |  | — |  |  |  | 1,549 |  |  |  | 1,529 |
Income (loss) from continuing operations before income tax expense |  | $ | 21,457 |  |  | $ | 10,792 |  |  | $ | 521 |  |  | $ | (15,878 | ) |  | $ | 16,892 |
Segment information for the nine months ended September 30, 2019 and 2018 was as follows (in thousands):
|  | Nine Months Ended September 30, 2019 |
|  | Financial Services |  |  | Benefits and Insurance Services |  |  | National Practices |  |  | Corporate and Other |  |  | Total |
Revenue |  | $ | 493,311 |  |  | $ | 225,342 |  |  | $ | 26,633 |  |  | $ | — |  |  | $ | 745,286 |
Operating expenses |  |  | 390,847 |  |  |  | 185,836 |  |  |  | 24,308 |  |  |  | 21,799 |  |  |  | 622,790 |
Gross margin |  |  | 102,464 |  |  |  | 39,506 |  |  |  | 2,325 |  |  |  | (21,799 | ) |  |  | 122,496 |
Corporate general & admin |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 33,916 |  |  |  | 33,916 |
Operating income (loss) |  |  | 102,464 |  |  |  | 39,506 |  |  |  | 2,325 |  |  |  | (55,715 | ) |  |  | 88,580 |
Other income: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest expense |  |  | — |  |  |  | (38 | ) |  |  | — |  |  |  | (4,471 | ) |  |  | (4,509 | )
Gain (loss) on sale of operations, net |  |  | 563 |  |  |  | — |  |  |  | — |  |  |  | (161 | ) |  |  | 402 |
Other (expense) income, net |  |  | (188 | ) |  |  | 204 |  |  |  | 1 |  |  |  | 12,699 |  |  |  | 12,716 |
Total other income |  |  | 375 |  |  |  | 166 |  |  |  | 1 |  |  |  | 8,067 |  |  |  | 8,609 |
Income (loss) from continuing operations before income tax expense |  | $ | 102,839 |  |  | $ | 39,672 |  |  | $ | 2,326 |  |  | $ | (47,648 | ) |  | $ | 97,189 |
|  | Nine Months Ended September 30, 2018 |
|  | Financial Services |  |  | Benefits and Insurance Services |  |  | National Practices |  |  | Corporate and Other |  |  | Total |
Revenue |  | $ | 478,485 |  |  | $ | 220,152 |  |  | $ | 24,343 |  |  | $ | — |  |  | $ | 722,980 |
Operating expenses |  |  | 386,649 |  |  |  | 181,697 |  |  |  | 22,356 |  |  |  | 17,757 |  |  |  | 608,459 |
Gross margin |  |  | 91,836 |  |  |  | 38,455 |  |  |  | 1,987 |  |  |  | (17,757 | ) |  |  | 114,521 |
Corporate general & admin |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 30,300 |  |  |  | 30,300 |
Operating income (loss) |  |  | 91,836 |  |  |  | 38,455 |  |  |  | 1,987 |  |  |  | (48,057 | ) |  |  | 84,221 |
Other income (expense): |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest expense |  |  | — |  |  |  | (96 | ) |  |  | — |  |  |  | (5,115 | ) |  |  | (5,211 | )
Gain on sale of operations, net |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 663 |  |  |  | 663 |
Other income (expense), net |  |  | 106 |  |  |  | 351 |  |  |  | — |  |  |  | 2,087 |  |  |  | 2,544 |
Total other income (expense) |  |  | 106 |  |  |  | 255 |  |  |  | — |  |  |  | (2,365 | ) |  |  | (2,004 | )
Income (loss) from continuing operations before income tax expense |  | $ | 91,942 |  |  | $ | 38,710 |  |  | $ | 1,987 |  |  | $ | (50,422 | ) |  | $ | 82,217 |

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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