Variable Interest Entities (VIEs)

6 Months Ended

Jun. 30, 2018

Organization, Consolidation and Presentation of Financial Statements [Abstract]

16.	Variable Interest Entities (VIEs)

A VIE is defined as a legal entity whose equity owners do not have sufficient equity at risk, or, as a group, the holders of the equity investment at risk lack any of the following three characteristics: decision-making rights, the obligation to absorb losses, or the right to receive the expected residual returns of the entity. The primary beneficiary is identified as the variable interest holder that has both the power to direct the activities of the VIE that most significantly affect the entity’s economic performance and the obligation to absorb expected losses or the right to receive benefits from the entity that could potentially be significant to the VIE.

The Company’s VIEs include APC and other immaterial entities.

Assets recognized as a result of consolidating these VIEs do not represent additional assets that could be used to satisfy claims against the Company’s general assets. Conversely, liabilities recognized as a result of consolidating these VIEs do not represent additional claims on the Company’s general assets; rather, they represent claims against the specific assets of the VIE.

The Company evaluates its relationships with its VIEs on an ongoing basis to ensure that it continues to be the primary beneficiary.

The following table includes assets that can only be used to settle the liabilities of APC and the creditors of APC have no recourse to the Company. These assets and liabilities, with the exception of the

investment in a privately held entity that does not report net asset value per share

and amounts due to affiliate, which are eliminated upon consolidation with the NMM, are included in the accompanying consolidated balance sheets.

	June 30, 2018		December 31, 2017

Assets

Current assets
Cash and cash equivalents	$	46,405,310	$	54,686,370
Restricted cash – short-term		8,040,870		18,005,661
Fiduciary cash		1,294,503		2,017,437
Investment in marketable securities		1,061,022		1,057,090
Receivables, net		28,601,680		15,183,483
Prepaid expenses and other current assets		1,531,872		1,821,328

Total current assets		86,935,257		92,771,369

Noncurrent assets
Land, property and equipment, net		9,990,830		10,167,689
Intangible assets, net		64,683,046		70,841,907
Goodwill		60,012,316		60,012,316
Loans receivable – related parties		7,500,000		5,000,000
Loan receivable		5,000,000		5,000,000
Investment in a privately held entity that does not report net asset value per share		4,725,000		4,320,000
Investments in other entities – equity method		23,545,361		21,903,524
Investment in joint venture – equity method		8,336,920		-
Restricted cash – long-term		745,352		745,235
Other assets		1,063,539		1,371,664

Total noncurrent assets		185,602,364		179,362,335

Total assets	$	272,537,621	$	272,133,704
Current liabilities
Accounts payable and accrued expenses	$	3,895,202	$	3,625,610
Incentives payable		5,000,000		21,500,000
Fiduciary accounts payable		1,294,503		2,017,437
Medical liabilities		20,243,608		25,186,240
Income taxes payable		2,882,773		1,463,540
Amount due to affiliate		17,624,486		24,889,717
Bank loan, short-term		278,017		510,391
Capital lease obligations		100,228		98,738

Total current liabilities		51,318,817		79,291,673

Noncurrent liabilities
Deferred tax liability		24,033,663		20,970,766
Liability for unissued equity shares		1,185,025		1,185,025
Dividend payable		617,210		-
Capital lease obligations, net of current portion		568,512		619,001

Total noncurrent liabilities		26,404,410		22,774,792

Total liabilities	$	77,723,227	$	102,066,465

The assets of the Company’s other consolidated VIEs were not considered significant.

As of June 30, 2018 and December 31, 2017, approximately $8,000,000 and $18,000,000, respectively, of restricted cash is related to an amount that, as a result of the Merger between ApolloMed and NMM (see Note 3), was held for distribution to former NMM shareholders.