Segment Disclosures

3 Months Ended

Mar. 31, 2023

Segment Reporting [Abstract]

Segment Disclosures

SEGMENT DISCLOSURES

Our business units have been aggregated into three practice groups: Financial Services, Benefits and Insurance Services and National Practices. The business units have been aggregated based on the following factors: similarity of the products and services provided to clients; similarity of the regulatory environment in which they operate; and similarity of economic conditions affecting long-term performance. The business units are managed along these segment lines. A general description of services provided by each practice group is provided in the table below.

Financial Services	Benefits and Insurance Services	National Practices
Accounting and Tax	Employee Benefits Consulting	Information Technology Managed Networking and Hardware Services
Financial Advisory	Payroll / Human Capital Management	Healthcare Consulting
Valuation	Property and Casualty Insurance
Risk and Advisory Services	Retirement and Investment Services
Government Healthcare Consulting

Corporate and Other - Included in Corporate and Other are operating expenses that are not directly allocated to the individual business units. These expenses primarily consist of certain health care costs, gains or losses attributable to assets held in our non-qualified deferred compensation plan, stock-based

compensation, consolidation and integration charges, certain professional fees, certain advertising costs and other various expenses.

Accounting policies of the practice groups are the same as those described in Note 1, Basis of Presentation and Significant Accounting Policies, to the Annual Report on Form 10-K for the year ended December 31, 2022. Upon consolidation, intercompany accounts and transactions are eliminated, thus inter-segment revenue is not included in the measure of profit or loss for the practice groups. Performance of the practice groups is evaluated on income (loss) before income tax expense (benefit) excluding those costs listed above, which are reported in the “Corporate and Other”.

Segment information for the three months ended March 31, 2023 and 2022 is presented below. We do not manage our assets on a segment basis, therefore segment assets are not presented below.

The following table disaggregates our revenue by source (in thousands):

	Three Months Ended March 31, 2023
	Financial Services		Benefits and Insurance Services		National Practices		Consolidated
Accounting, tax, advisory and consulting	$	343,086	—		—		$	343,086
Core benefits and insurance services	—		96,617		—		96,617
Non-core benefits and insurance services	—		3,437		—		3,437
Managed networking, hardware services	—		—		8,954		8,954
National practices consulting	—		—		2,512		2,512
Total revenue	$	343,086	$	100,054	$	11,466	$	454,606

	Three Months Ended March 31, 2022
	Financial Services		Benefits and Insurance Services		National Practices		Consolidated
Accounting, tax, advisory and consulting	$	288,746	—		—		$	288,746
Core benefits and insurance services	—		88,936		—		88,936
Non-core benefits and insurance services	—		3,550		—		3,550
Managed networking, hardware services	—		—		7,921		7,921
National practices consulting	—		—		2,569		2,569
Total revenue	$	288,746	$	92,486	$	10,490	$	391,722

Segment information for the three months ended March 31, 2023 and 2022 was as follows (in thousands):

	Three Months Ended March 31, 2023
	Financial Services		Benefits and Insurance Services		National Practices		Corporate and Other		Total
Revenue	$	343,086	$	100,054	$	11,466	$	—	$	454,606
Operating expenses	244,443		76,923		10,583		9,062		341,011
Gross margin	98,643		23,131		883		(9,062)		113,595
Corporate general and administrative expenses	—		—		—		15,598		15,598
Operating income (loss)	98,643		23,131		883		(24,660)		97,997
Other income (expense):
Interest expense	—		(1)		—		(3,640)		(3,641)
Gain on sale of operations, net	99		—		—		—		99
Other income, net	255		177		—		4,680		5,112
Total other income, net	354		176		—		1,040		1,570
Income (loss) before income tax expense	$	98,997	$	23,307	$	883	$	(23,620)	$	99,567

	Three Months Ended March 31, 2022
	Financial Services		Benefits and Insurance Services		National Practices		Corporate and Other		Total
Revenue	$	288,746	$	92,486	$	10,490	$	—	$	391,722
Operating expenses (income)	209,800		72,657		9,576		(1,734)		290,299
Gross margin	78,946		19,829		914		1,734		101,423
Corporate general and administrative expenses	—		—		—		16,309		16,309
Operating income (loss)	78,946		19,829		914		(14,575)		85,114
Other income (expense):
Interest expense	—		—		—		(1,259)		(1,259)
Other income (expense), net	86		(24)		—		(6,469)		(6,407)
Total other income (expense), net	86		(24)		—		(7,728)		(7,666)
Income (loss) before income tax expense	$	79,032	$	19,805	$	914	$	(22,303)	$	77,448