2018 Annual Report

Page 44

The guidance aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). The accounting for the service element of a hosting arrangement that is a service contract is not affected by this guidance. This guidance becomes effective for interim and annual periods beginning after December 15, 2020. The guidance also requires an entity (customer) to expense the capitalized implementation costs of a hosting arrangement that is a service contract over the term of the hosting arrangement. It further specifies where to present expense and payments in the financial statements. Early adoption is permitted. The guidance is to be applied on a retrospective or prospective basis to all implementation costs incurred after the date of adoption. The Company is evaluating the impact of adoption on the Company’s financial condition and its results of operations. In August 2018, the FASB issued guidance entitled “Disclosure Framework — Changes to the Disclosure Requirements for Defined Benefit Plans.” The guidance modifies the disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans. This guidance becomes effective for fiscal years ending after December 15, 2020. Early adoption is permitted. The guidance is to be applied on a retrospective basis for all periods. The adoption of this guidance will not impact the Company’s financial condition or its results of operations, but will impact the employee benefit plan disclosures.

NOTE 3 – Prepaid Assets Prepaid assets consist of the following: December 31,

2018

2017

2016

$ 4,622,660

$ 2,040,310

$ 1,702,483

Unbilled revenue

154,314

636,906

504,192

Federal and state taxes

237,889

375,424

83,142

41,578

47,432

1,951

$ 5,056,441

$ 3,100,072

$ 2,291,768

Prepaid vendor invoices

Other

NOTE 4 – Fixed Assets Fixed assets consisted of the following: December 31, Computer equipment Computer software Furniture and fixtures Less: Accumulated depreciation

2018

2017

2016

$ 15,947,377

$ 12,691,805

$ 11,162,903

11,919,745

21,781,033

19,705,397

1,906,102

2,204,100

2,068,939

29,773,224

36,676,938

32,937,239

23,431,423

30,893,462

27,690,478

$ 6,341,801

$ 5,783,476

$ 5,246,761

For the year ended December 31, 2018 there were disposals of $11,110,369 with a realized loss of $26,001. For the years ended December 31, 2017 and 2016 there were disposals of fully depreciated assets of $185,555 and $10,473,414, respectively. Depreciation expense related to the Company’s property and equipment was $3,622,330 $3,388,539, and $3,214,145 in 2018, 2017, and 2016 respectively.

42 Farm Credit Financial Partners | 2018 Annual Report


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