2019 BBNC Annual Report - Page 69

(12) BENEFIT PLANS The Corporation maintains a 401(k) savings plan that contains a safe harbor matching contribution up to 5% of covered wages for all contributing employees. In addition, at the discretion of the Corporation’s Board of Directors, the Corporation may make a profit sharing contribution to the plan. Employee contributions were matched up to 5% of the employees’ salaries in 2019, 2018 and 2017, respectively. Amounts expensed for the plan for the years ended March 31, 2019, 2018 and 2017 were $14,764,000, $14,984,000 and $13,854,000, respectively. The Corporation is self-insured for healthcare, which covers the majority of employees of the Corporation and its wholly owned subsidiaries. The cost of providing the benefits for employees and dependents is limited to agreed-upon stop- loss levels of $475,000 per claim with an additional $250,000 aggregate. At March 31, 2019 and 2018, the Corporation had accrued liabilities of approximately $4,576,507 and $5,178,000, respectively. The Corporation has a large deductible insurance plan for workers’ compensation covering all employees except foreign employees and employees in the states of Washington, North Dakota, Wyoming and Ohio. At March 31, 2019 and 2018, the Corporation had accrued liabilities recorded of approximately $3,000,000 and $2,926,000, of which $1,715,193 and $1,319,000, respectively, was for workers’ compensation claims incurred but not reported. At March 31, 2019 and 2018, the Corporation had a $3,750,000 and $3,750,000, respectively, letter of credit balance held by its workers’ compensation insurer pursuant to the terms of a collateral agreement with the insurer. (13) INCOME TAXES On December 22, 2017, the Tax Cuts and Jobs Act (the Act) was signed into law. Among other provisions, the Act reduces the federal statutory corporate income tax rate from 35% to 21% and allows the Corporation to elect annually to deduct contributions made to its settlement trust, subject to limitations. This rate reduction did have a significant impact on the Corporation’s provision for income taxes for year ended March 31, 2018, due to the one-time impact resulting from the revaluation of deferred tax assets and liabilities to reflect the new lower rate. Recognition of the income tax impact of the Corporation’s election to deduct its contributions to its settlement trust was also significant. The components of income tax expense (benefit) for the years ended March 31, 2019, 2018 and 2017 are as follows (in thousands): 2019 2018 2017 12,011 (6,681) 17,522 3,867 210 3,638 (16,111) — — (233) (6,471) 21,160 11,000 (33,384) 1,927 3,243 (6,493) 477 14,243 (39,877) 2,404 14,010 (46,348) 23,564 CURRENT BEFORE NET OPERATING LOSS CARRYFORWARDS: Federal $ State Tax benefit of net operating loss carryforwards DEFERRED: Federal State $ M anagement ' s D iscussion and A nalysis 67