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7) Business Segments
 6 Months Ended
Jun. 30, 2012
Notes  
7) Business Segments

7)    Business Segments

 

Description of Products and Services by Segment

 

The Company has three reportable business segments: life insurance, cemetery and mortuary, and mortgage. The Company’s life insurance segment consists of life insurance premiums and operating expenses from the sale of insurance products sold by the Company’s independent agency force and net investment income derived from investing policyholder and segment surplus funds. The Company’s cemetery and mortuary segment consists of revenues and operating expenses from the sale of at-need cemetery and mortuary merchandise and services at its mortuaries and cemeteries, pre-need sales of cemetery spaces after collection of 10% or more of the purchase price and the net investment income from investing segment surplus funds. The Company’s mortgage loan segment consists of loan originations fee income and expenses from the originations of residential and commercial mortgage loans and interest earned and interest expenses from warehousing pre-sold loans before the funds are received from financial institutional investors.

 

Measurement of Segment Profit or Loss and Segment Assets

 

The accounting policies of the reportable segments are the same as those described in the Significant Accounting Principles of the form 10K for the year ended December 31, 2011. Intersegment revenues are recorded at cost plus an agreed upon intercompany profit, and are eliminated upon consolidation.

 

Factors Management Used to Identify the Enterprise’s Reportable Segments

 

The Company’s reportable segments are business units that offer different products and are managed separately due to the different products and the need to report to the various regulatory jurisdictions.

 

Life Insurance

Cemetery/ Mortuary

Mortgage

Reconciling Items

Consolidated

For the Three Months Ended

June 30, 2012

Revenues from external customers

 $17,481,537

 $2,730,517

 $36,316,156

 $          -

 $56,528,210

Intersegment revenues

 2,081,734

 380,565

 75,882

 (2,538,181)

 -

Segment profit (loss) before income taxes

 2,054,297

 (77,463)

 3,059,543

 -

 5,036,377

For the Three Months Ended

June 30, 2011

Revenues from external customers

 $16,598,670

 $3,723,533

 $16,144,215

 $         -

 $36,466,418

Intersegment revenues

 1,632,386

 480,581

 60,749

 (2,173,716)

 -

Segment profit (loss) before income taxes

 338,044

 662,744

 (859,610)

 -

 141,178

For the Six Months Ended

June 30, 2012

Revenues from external customers

 $35,108,886

 $5,690,157

 $63,052,390

 $103,851,433

Intersegment revenues

 4,160,833

 757,558

 151,289

 (5,069,680)

 -

Segment profit before income taxes

 2,891,861

 149,092

 4,324,016

 -

 7,364,969

Identifiable Assets

 520,595,067

 112,435,625

 40,261,098

 (119,681,252)

 553,610,538

Goodwill

 391,848

 285,191

 -

 -

 677,039

For the Six Months Ended

June 30, 2011

Revenues from external customers

 $33,746,991

 $6,756,619

 $30,134,988

 $         -

 $70,638,598

Intersegment revenues

 3,699,098

 948,606

 121,086

 (4,768,790)

 -

Segment profit (loss) before income taxes

 1,417,523

 814,368

 (3,413,295)

 -

 (1,181,404)

Identifiable Assets

 474,375,686

 111,945,435

 24,999,574

 (119,549,486)

 491,771,209

Goodwill

 391,848

 285,191

 -

 -

 677,039