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CONSOLIDATION OF VARIABLE INTEREST ENTITIES | 3 Months Ended
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Mar. 31, 2026
Organization, Consolidation and Presentation of Financial Statements [Abstract] |
CONSOLIDATION OF VARIABLE INTEREST ENTITIES | CONSOLIDATION OF VARIABLE INTEREST ENTITIES The Company consolidates VIEs for which it is the primary beneficiary or VIEs for which it controls through a majority voting interest or other arrangement. See Note 2, Summary of Significant Accounting Policies of our 2025 Annual Report, for more information on how the Company evaluates an entity for consolidation in accordance with ASC 810, Consolidation (“ASC 810”). The Company evaluated any entity in which it had a variable interest upon formation to determine whether the entity should be consolidated. The Company also evaluated the consolidation conclusion during each reconsideration event, such as changes in the governing documents or additional equity contributions to the entity. During the three months ended March 31, 2026, the Company’s consolidated VIE, LMA Income Series II LP, had total assets of $123,556,607 and liabilities of $38,458,866. For the year ended December 31, 2025, the Company’s consolidated VIEs, LMA Income Series II LP, LMX Series LLC (LMATT Series 2024, Inc.), and LMA Income Series, LP, had total assets and liabilities of $204,604,881 and $115,186,408. The Company did not deconsolidate any entities during the three months ended March 31, 2026, or year ended December 31, 2025. Refer to Note 14, Long-Term Debt for information related to the classification of assets and liabilities. Carlisle manages collective portfolios of several Luxembourg alternative investment funds investing in life insurance policies. Carlisle is registered as an authorized alternative investment fund manager (“AIFM”) by Luxembourg’s Commission de Surveillance du Secteur Financier (“CSSF”). Carlisle manages three funds and eight sub-funds. The funds and sub-funds managed by Carlisle are collectively referred to as the “Carlisle Funds”. The Company, through LMA, services the life insurance policies held by the Carlisle Funds. The Company concluded that it does not have a controlling financial interest in the Carlisle Funds pursuant to ASC 810-10. Accordingly, the Carlisle Funds are not consolidated in the Company's financial statements. The management fee arrangement is the only interest in the funds and the fees are customary and commensurate, therefore not providing a variable interest in the funds. As a result, all transactions between the Company and the Carlisle Funds, including life policy purchases and sales, servicing fees, and management fee receivables are classified as related party transactions. Refer to Note 4, Revenues and Note 19, Related-Party Transactions for additional information. The Company established Abacus Enhanced Income Fixed LP, Abacus Enhanced Income Plus LP, Abacus Premiere Income Fixed LP, and Abacus Premiere Income Plus LP (collectively the “LP Funds”) and respective wholly owned general partner entities for the purpose of managing the LP Funds and servicing the policies invested by the LP Funds. The Company concluded that it does not have a controlling financial interest in the LP Funds pursuant to ASC 810-10. Accordingly, the LP Funds are not consolidated in the Company's financial statements. It was determined that the Company’s management has significant influence over the significant activities of the unconsolidated LP Funds through contract but does not have significant economic interest through equity or otherwise. As a result, all transactions between the Company and the LP Funds, including life policy purchases and sales, servicing fees, and management fee receivables are classified as related party transactions. Refer to Note 4, Revenues and Note 19, Related-Party Transactions for additional information. The Company established 2025 LMA LLC (“Securitized Entity”) for the purpose of providing investors with a pool of life policies through a sale of life policies and to serve as static collateral pool to secure their investment in a promissory note issued by the Securitized Entity. The Company, through its LMA subsidiary, services the static collateral pool. The Company is a Class B member with contributed capital of $8,699,569, representing all of the nonvoting economic interest in the Securitized Entity. The Class A member has all of the voting noneconomic interest in the Securitized Entity. The Class A member has substantive power to remove the Company as the servicer of the Securitized Entity. The Company concluded that it was not the primary beneficiary in the Securitized Entity due to lack of power pursuant to ASC 810. Accordingly, the Securitized Entity is not consolidated in the Company's financial statements. It was determined that while the Company’s management does not have the authority to establish policies or make significant decision impacting the Securitization Fund, it is serving as the servicer for the securitized static collateral pool under the direct supervision of an independent manger. As a result, life policy sales and fee revenue earned by LMA from the Securitized Entity is presented as related party servicing revenue in the Company's consolidated financial statements. Refer to Note 4, Revenues and Note 19, Related-Party Transactions for additional information.

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- Definition The entire disclosure for a variable interest entity (VIE), including but not limited to, judgments and assumptions in determining whether to consolidate and in identifying the primary beneficiary, gain (loss) recognized on the initial consolidation of the VIE, terms of arrangements, amounts and classification of the VIE's assets and liabilities, and the entity's maximum exposure to loss. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 810 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/810/tableOfContent + Details
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