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15) Business Segment Information

12 Months Ended

Dec. 31, 2017

Notes

15) Business Segment Information

15)       Business Segment Information

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 fee income and expenses from the originations of residential 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. 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 are managed separately due to the different products provided and the need to report separately to the various regulatory jurisdictions. The Company regularly reviews the quantitative thresholds and other criteria to determine when other business segments may need to be reported.

	2017
	Life		Cemetery/				Intercompany
	Insurance		Mortuary		Mortgage		Eliminations		Consolidated
Revenues:
From external sources:
Revenue from customers	$       70,412,476		$       12,657,117		$     153,797,171		$                         -		$     236,866,764
Net investment income	34,068,565		445,663		548,740		-		35,062,968
Realized gains (losses) on
investments and other assets	(3,871,309)		186,335		736,492		-		(2,948,482)
Other than temporary impairments	(774,339)		-		-		-		(774,339)
Other revenues	856,094		97,602		7,765,483		-		8,719,179
Intersegment revenues:
Net investment income	5,987,731		422,623		392,083		(6,802,437)		-
Total revenues	106,679,218		13,809,340		163,239,969		(6,802,437)		276,926,090
Expenses:
Death and other policy benefits	36,095,018		-		-		-		36,095,018
Increase in future policy benefits	23,622,750		-		-		-		23,622,750
Amortization of deferred policy     and preneed acquisition costs and
value of business acquired	8,157,456		322,794		-		-		8,480,250
Depreciation	484,349		401,564		1,334,780		-		2,220,693
General, administrative and
other costs:
Intersegment	315,588		184,853		505,707		(1,006,148)		-
Provision for loan losses	-		-		-		-		-
Costs related to funding mortgage
loans	-		-		8,663,223		-		8,663,223
Other	30,632,307		10,689,813		142,952,592		-		184,274,712
Interest expense:
Intersegment	445,520		181,793		5,168,976		(5,796,289)		-
Other	2,218,956		330,211		3,488,165		-		6,037,332
Total benefits and expenses	101,971,944		12,111,028		162,113,443		(6,802,437)		269,393,978
Earnings before income    taxes	$         4,707,274		$         1,698,312		$         1,126,526		$                         -		$         7,532,112
Income tax benefit (expense)	6,400,669		(606,293)		786,446		-		6,580,822
Net earnings	$       11,107,943		$         1,698,312		$         1,912,972		$                         -		$       14,112,934
Identifiable assets	$     858,068,899		$       95,097,729		$     161,051,531		$     (134,810,675)		$     979,407,484
Goodwill	$         2,765,570		$                        -		$                        -		$                         -		$         2,765,570

	2016
	Life		Cemetery/				Intercompany
	Insurance		Mortuary		Mortgage		Eliminations		Consolidated
Revenues:
From external sources:
Revenue from customers	$       64,501,017		$       12,267,640		$     189,146,639		$                         -		$     265,915,296
Net investment income	31,019,594		312,494		646,513		-		31,978,601
Realized gains (losses) on
investments and other assets	(277,040)		211,429		(110,776)		-		(176,387)
Other than temporary impairments	(270,358)		-		-		-		(270,358)
Other revenues	632,260		88,676		6,166,813		-		6,887,749
Intersegment revenues:
Net investment income	7,119,692		691,876		327,778		(8,139,346)		-
Total revenues	102,725,165		13,572,115		196,176,967		(8,139,346)		304,334,901
Expenses:
Death and other policy benefits	33,387,380		-		-		-		33,387,380
Increase in future policy benefits	21,322,195		-		-		-		21,322,195
Amortization of deferred policy     and preneed acquisition costs and
value of business acquired	7,647,097		356,078		-		-		8,003,175
Depreciation	596,827		390,362		1,195,535		-		2,182,724
General, administrative and
other costs:
Intersegment	261,119		148,025		219,974		(629,118)		-
Provision for loan losses	-		-		1,700,000		-		1,700,000
Costs related to funding mortgage
loans	-		-		9,191,488		-		9,191,488
Other	29,478,156		10,524,535		163,730,148		1		203,732,840
Interest expense:
Intersegment	519,959		651,046		6,339,224		(7,510,229)		-
Other	1,654,264		282,878		3,174,726		-		5,111,868
Total benefits and expenses	94,866,997		12,352,924		185,551,095		(8,139,346)		284,631,670
Earnings before income    taxes	$         7,858,168		$         1,219,191		$       10,625,872		$                         -		$       19,703,231
Income tax expense	(3,451,292)		-		(4,063,312)		-		(7,514,604)
Net earnings	$         4,406,876		$         1,219,191		$         6,562,560		$                         -		$       12,188,627
Identifiable assets	$     818,140,804		$       99,611,263		$     172,778,387		$     (140,874,459)		$     949,655,995
Goodwill	$         2,765,570		$                        -		$                        -		$                         -		$         2,765,570
Expenditures for long-lived assets	$            532,958		$            723,445		$         2,310,108		$                         -		$         3,566,511

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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://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-URI http://asc.fasb.org/topic&trid=2134510

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