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7) Business Segments
 6 Months Ended
Jun. 30, 2014
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 segment consists of loan 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, 2013. 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

Eliminations

Consolidated

For the Three Months Ended

June 30, 2014

Revenues from external customers

 $  19,810,498

 $   3,534,881

 $   36,066,351

 $                -

 $   59,411,730

Intersegment revenues

       2,356,195

        334,314

          231,249

     (2,921,758)

                    -

Segment profit before income taxes

       1,515,426

        168,911

       2,502,760

                   -

       4,187,097

For the Three Months Ended

June 30, 2013

Revenues from external customers

 $  16,797,489

 $   3,380,560

 $   41,154,240

 $                -

 $   61,332,289

Intersegment revenues

       2,504,960

        357,016

           67,603

     (2,929,579)

                    -

Segment profit before income taxes

         440,822

        107,601

       3,921,097

                   -

       4,469,520

For the Six Months Ended

June 30, 2014

Revenues from external customers

 $  38,283,314

 $   6,575,449

 $   59,606,243

 $                -

 $ 104,465,006

Intersegment revenues

       4,417,915

        670,612

          395,395

     (5,483,922)

                    -

Segment profit before income taxes

       2,846,895

        351,689

       1,154,500

                   -

       4,353,084

Identifiable Assets

   626,378,955

  108,686,715

     56,057,674

  (148,165,860)

    642,957,484

Goodwill

       2,802,991

        285,191

                    -

                   -

       3,088,182

For the Six Months Ended

June 30, 2013

Revenues from external customers

 $  34,041,381

 $   6,360,591

 $   75,782,551

 $                -

 $ 116,184,523

Intersegment revenues

       5,092,793

        715,506

          124,765

     (5,933,064)

                    -

Segment profit before income taxes

       1,255,153

        184,366

       6,257,624

                   -

       7,697,143

Identifiable Assets

   571,473,136

  112,584,116

     66,990,347

  (134,012,151)

    617,035,448

Goodwill

         391,848

        285,191

                    -

                   -

          677,039