0001493152-22-008236 | 10-K | XBRL Viewer | Security National Financial Corp

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Revenues of the Cemetery and Mortuary Contracts (Details) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Net mortuary and cemetery sales	$ 23,997,313	$ 20,307,435
Major Goods or Services Lines, at Need [Member]
Net mortuary and cemetery sales	16,220,541	15,212,822
Major Goods or Services Lines, Pre Need [Member]
Net mortuary and cemetery sales	7,776,772	5,094,613
Timing of Revenue Recognition, Goods Transferred At A Point In Time [Member]
Net mortuary and cemetery sales	16,793,439	13,438,592
Timing of Revenue Recognition, Services Transferred At A Point In Time [Member]
Net mortuary and cemetery sales	$ 7,203,874	$ 6,868,843

Summary of Bank Loans Payable (Details) (Parenthetical) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Debt Instrument [Line Items]
Debt instrument interest rate	7.00%
Note Payable 1 [Member]
Debt Instrument [Line Items]
Debt instrument interest rate	4.27%	4.27%
Debt instrument principal amount	$ 53,881	$ 53,881
Note Payable 2 [Member]
Debt Instrument [Line Items]
Debt instrument principal amount	$ 75,108	$ 75,108
Note Payable 3 [Member]
Debt Instrument [Line Items]
Debt instrument interest rate	4.329%	4.329%
Debt instrument principal amount	$ 9,775	$ 9,775
Debt instrument, book value	$ 3,103,000	$ 3,103,000
Note Payable 4 [Member]
Debt Instrument [Line Items]
Debt instrument interest rate	4.00%	4.00%
Debt instrument, book value	$ 64,730,000	$ 64,730,000
Debt instrument basis spread variable rate	1.00%	1.00%
Debt instrument basis spread variable rate	3.00%	3.00%
Note Payable 5 [Member]
Debt Instrument [Line Items]
Debt instrument principal amount	$ 113,000	$ 113,000
Debt instrument, book value	$ 49,118,000	$ 49,118,000
Debt instrument basis spread variable rate	2.50%	2.50%
Note Payable 6 [Member]
Debt Instrument [Line Items]
Debt instrument interest rate	330.00%	330.00%
Debt instrument principal amount	$ 179,562	$ 179,562
Debt instrument, book value	$ 49,118,000	$ 49,118,000
Note Payable 7 [Member]
Debt Instrument [Line Items]
Debt instrument interest rate	478.65%	478.65%
Debt instrument, book value	$ 17,301,000	$ 17,301,000
Note Payable 8 [Member]
Debt Instrument [Line Items]
Debt instrument principal amount	$ 100,000,000	$ 100,000,000
Debt instrument basis spread variable rate	2.10%	2.10%
Note Payable 9 [Member]
Debt Instrument [Line Items]
Debt instrument principal amount	$ 100,000,000	$ 100,000,000
Debt instrument basis spread variable rate	2.00%	2.00%
Note Payable 10 [Member]
Debt Instrument [Line Items]
Debt instrument principal amount	$ 75,000,000	$ 75,000,000
Debt instrument basis spread variable rate	2.15%	2.15%
Note Payable 11 [Member]
Debt Instrument [Line Items]
Debt instrument principal amount	$ 100,000,000	$ 100,000,000
Debt instrument basis spread variable rate	2.00%	2.00%
Note Payable 12 [Member]
Debt Instrument [Line Items]
Debt instrument principal amount	$ 5,000,000	$ 5,000,000
Debt instrument basis spread variable rate	2.50%	2.50%

Investments (Tables)

12 Months Ended

Dec. 31, 2021

Investments, Debt and Equity Securities [Abstract]

Schedule of Investments

The Company’s investments as of December 31, 2021 are summarized as follows:

Schedule of Investments

	Amortized Cost			Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
December 31, 2021:
Fixed maturity securities, available for sale, at estimated fair value:
U.S. Treasury securities and obligations of U.S. Government agencies	$	22,307,736		$	578,567	$	-		$	22,886,303

Obligations of states and political subdivisions		4,649,917			212,803		(1,989	)		4,860,731

Corporate securities including public utilities		174,711,061			21,791,370		(353,668	)		196,148,763

Mortgage-backed securities		34,365,382			905,159		(161,332	)		35,109,209

Redeemable preferred stock		269,214			13,383		-			282,597

Total fixed maturity securities available for sale	$	236,303,310		$	23,501,282	$	(516,989	)	$	259,287,603

Equity securities at estimated fair value:

Common stock:

Industrial, miscellaneous and all other	$	8,275,772		$	3,626,444	$	(305,802	)	$	11,596,414

Total equity securities at estimated fair value	$	8,275,772		$	3,626,444	$	(305,802	)	$	11,596,414

Mortgage loans held for investment at amortized cost:
Residential	$	53,533,712
Residential construction		175,117,783
Commercial		51,683,022
Less: Unamortized deferred loan fees, net		(918,586	)
Less: Allowance for loan losses		(1,699,902	)
Less: Net discounts		(409,983	)

Total mortgage loans held for investment	$	277,306,046

Real estate held for investment - net of accumulated depreciation:
Residential	$	41,972,462
Commercial		155,393,335

Total real estate held for investment	$	197,365,797

Real estate held for sale:
Residential	$	1,190,602
Commercial		2,540,698

Total real estate held for sale	$	3,731,300

Other investments and policy loans at amortized cost:
Policy loans	$	13,478,214
Insurance assignments		48,632,808
Federal Home Loan Bank stock (1)		2,547,100
Other investments		4,983,251
Less: Allowance for doubtful accounts		(1,686,218	)

Total policy loans and other investments	$	67,955,155

Accrued investment income	$	6,313,012

Total investments	$	823,555,327

(1)	Includes $905,700 of Membership stock and $1,641,400 of Activity stock due to short-term advances and letters of credit.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

2) Investments (Continued)

The Company’s investments as of December 31, 2020 are summarized as follows:

	Amortized Cost			Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
December 31, 2020:
Fixed maturity securities, available for sale, at estimated fair value:
U.S. Treasury securities and obligations of U.S. Government agencies	$	42,381,805		$	1,358,562	$	-		$	43,740,367

Obligations of states and political subdivisions		5,383,762			312,214		(1,261	)		5,694,715

Corporate securities including public utilities		186,067,912			27,216,496		(681,478	)		212,602,930

Mortgage-backed securities		31,047,791			1,565,377		(267,106	)		32,346,062

Redeemable preferred stock		269,214			3,391		-			272,605

Total fixed maturity securities available for sale	$	265,150,484		$	30,456,040	$	(949,845	)	$	294,656,679

Equity securities at estimated fair value:

Common stock:

Industrial, miscellaneous and all other	$	9,698,490		$	2,376,156	$	(750,407	)	$	11,324,239

Total equity securities at estimated fair value	$	9,698,490		$	2,376,156	$	(750,407	)	$	11,324,239

Mortgage loans held for investment at amortized cost:
Residential	$	95,822,448
Residential construction		111,111,777
Commercial		46,836,866
Less: Unamortized deferred loan fees, net		(1,161,132	)
Less: Allowance for loan losses		(2,005,127	)
Less: Net discounts		(1,260,896	)

Total mortgage loans held for investment	$	249,343,936

Real estate held for investment - net of accumulated depreciation:
Residential	$	24,843,743
Commercial		106,840,710

Total real estate held for investment	$	131,684,453

Real estate held for sale:
Residential	$	3,478,254
Commercial		4,400,553

Total real estate held for sale	$	7,878,807

Other investments and policy loans at amortized cost:
Policy loans	$	14,171,589
Insurance assignments		53,231,131
Federal Home Loan Bank stock (1)		2,506,600
Other investments		5,432,816
Less: Allowance for doubtful accounts		(1,645,475	)

Total policy loans and other investments	$	73,696,661

Accrued investment income	$	5,360,523

Total investments	$	773,945,298

(1)	Includes $866,900 of Membership stock and $1,639,700 of Activity stock due to short-term advances and letters of credit.

Schedule of Fair Value of Fixed Maturity Securities

The following tables summarize unrealized losses on fixed maturities securities that were carried at estimated fair value at December 31, 2021 and at December 31, 2020. The unrealized losses were primarily related to interest rate fluctuations and uncertainties relating to COVID-19. The tables set forth unrealized losses by duration with the fair value of the related fixed maturity securities:

	Unrealized Losses for Less than Twelve Months		Fair Value		Unrealized Losses for More than Twelve Months		Fair Value		Total Unrealized Loss		Fair Value
At December 31, 2021
Obligations of States and Political Subdivisions	$	1,989	$	548,715	$	-	$	-	$	1,989	$	548,715
Corporate Securities		73,507		4,638,750		280,161		3,771,813		353,668		8,410,563
Mortgage and other asset-backed securities		72,952		7,934,760		88,380		1,582,804		161,332		9,517,564
Total unrealized losses	$	148,448	$	13,122,225	$	368,541	$	5,354,617	$	516,989	$	18,476,842

At December 31, 2020
Obligations of States and Political Subdivisions	$	1,261	$	206,812	$	-	$	-	$	1,261	$	206,812
Corporate Securities		242,596		9,919,298		438,882		2,593,026		681,478		12,512,324
Mortgage and other asset-backed securities		266,522		3,455,574		584		51,961		267,106		3,507,535
Total unrealized losses	$	510,379	$	13,581,684	$	439,466	$	2,644,987	$	949,845	$	16,226,671

Schedule of Earnings on Fixed Maturity Securities

The following table presents a rollforward of the Company’s cumulative other than temporary credit impairments (“OTTI”) recognized in earnings on fixed maturity securities available for sale.

	2021			2020
Balance of credit-related OTTI at January 1	$	370,975		$	-

Additions for credit impairments recognized on:
Securities not previously impaired		39,502			370,975
Securities previously impaired		-			-

Reductions for credit impairments previously recognized on:
Securities that matured or were sold during the period (realized)		(145,500	)		-
Securities due to an increase in expected cash flows		-			-

Balance of credit-related OTTI at December 31	$	264,977		$	370,975

Schedule of Investments Classified by Contractual Maturity Date

The following table presents the amortized cost and estimated fair value of fixed maturity securities available for sale at December 31, 2021, by contractual maturity. Expected maturities may differ from contractual maturities because certain borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

	Amortized		Estimated Fair
	Cost		Value
Due in 1 year	$	68,966	$	70,024
Due in 2-5 years		62,958,696		65,605,915
Due in 5-10 years		70,740,783		77,346,448
Due in more than 10 years		67,900,269		80,873,410
Mortgage-backed securities		34,365,382		35,109,209
Redeemable preferred stock		269,214		282,597
Total	$	236,303,310	$	259,287,603

Schedule of Gain (Loss) on Investments

The following tables presents the net realized gains and losses from sales, calls, and maturities, unrealized gains and losses on equity securities, and other than temporary impairments from investments and other assets.

Schedule of Gain (Loss) on Investments


	Years Ended December 31
	2021			2020
Fixed maturity securities available for sale:
Gross realized gains	$	984,740		$	445,749
Gross realized losses		(139,728	)		(77,546	)
Other than temporary impairments		(39,502	)		(370,975	)

Equity securities:
Gains on securities sold		390,597			74,836
Unrealized gains on securities held at the end of the period		2,732,130			1,125,304

Other assets:
Gross realized gains		4,786,535			2,342,418
Gross realized losses		(2,489,140	)		(1,984,911	)
Total	$	6,225,632		$	1,554,875

Schedule of Major Categories of Net Investment Income

Information regarding sales of fixed maturity securities available for sale is presented as follows.


	Years Ended December 31
	2021			2020
Proceeds from sales	$	2,896,351		$	5,477,438
Gross realized gains		208,698			358,236
Gross realized losses		(4,046	)		(21,137	)

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

2) Investments (Continued)

Major categories of net investment income were as follows:


	Years Ended December 31
	2021			2020
Fixed maturity securities available for sale	$	10,769,979		$	12,233,394
Equity securities		446,337			642,433
Mortgage loans held for investment		28,758,614			25,672,746
Real estate held for investment and sale		12,334,989			11,945,401
Policy loans		940,890			1,025,179
Insurance assignments		19,062,052			17,837,578
Other investments		131,145			126,013
Cash and cash equivalents		235,470			426,623
Gross investment income		72,679,476			69,909,367
Investment expenses		(14,414,793	)		(13,579,564	)
Net investment income	$	58,264,683		$	56,329,803

Schedule of Commercial Real Estate Investment

The Company’s commercial real estate held for investment is summarized as follows:

	Net Ending Balance				Total Square Footage
	December 31				December 31
	2021		2020		2021		2020
Utah (1)	$	150,105,948	$	100,927,528		675,920		379,066
Louisiana		2,426,612		2,998,684		31,778		84,841
Mississippi		2,860,775		2,914,498		19,694		21,521

	$	155,393,335	$	106,840,710		727,392		485,428

(1)	Includes Center53 phase 1 and phase 2

The Company’s commercial real estate held for sale is summarized as follows:

	Net Ending Balance				Total Square Footage
	December 31				December 31
	2021		2020		2021		2020
Kansas	$	2,000,000	$	4,000,000		222,679		222,679
Louisiana		389,145		-		2,872		-
Mississippi (1)		151,553		151,553		-		12,300
Texas (2)				249,000		-		-

	$	2,540,698	$	4,400,553		225,551		234,979

(1)	Approximately 93 acres of undeveloped land, in 2021, the existing building was removed

(2)	Improved commercial pad

Schedule of Residential Real Estate Investment

The Company’s residential real estate held for investment is summarized as follows:


	Net Ending Balance
	December 31
	2021		2020
Utah (1)	$	41,686,281	$	24,557,562
Washington (2)		286,181		286,181
Residential Real Estate Investment	$	41,972,462	$	24,843,743

(1)	Including subdivision land developments

(2)	Improved residential lots

The following table presents additional information regarding the Company’s subdivision land developments in Utah.


	December 31
	2021		2020
Lots available for sale		67		36
Lots to be developed		548		350
Ending Balance	$	41,479,434	$	23,777,478
Residential Real Estate Investment	$	41,479,434	$	23,777,478

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

2) Investments (Continued)

The Company’s residential real estate held for sale is summarized as follows:


	Net Ending Balance
	December 31
	2021		2020
Nevada	$	979,640	$	979,640
Texas		200,962		-
Ohio		10,000		10,000
Florida		-		744,322
Utah		-		1,744,292
Real Estate held for Sale	$	1,190,602	$	3,478,254

Schedule of Real Estate Owned and Occupied by the Company

The primary business units of the Company occupy a portion of the commercial real estate owned by the Company. As of December 31, 2021, real estate owned and occupied by the Company is summarized as follows:

Location	Business Segment	Approximate Square Footage		Square Footage Occupied by the Company
433 West Ascension Way, Salt Lake City, UT - Center53 Phase 2	Corporate Offices, Life Insurance, Cemetery/Mortuary Operations, and Mortgage Operations and Sales		221,000		50	%
1044 River Oaks Dr., Flowood, MS	Life Insurance Operations		19,694		28	%
1818 Marshall Street, Shreveport, LA (1)	Life Insurance Operations		12,274		100	%
909 Foisy Street, Alexandria, LA (1)	Life Insurance Sales		8,059		100	%
812 Sheppard Street, Minden, LA (1)	Life Insurance Sales		1,560		100	%
1550 N 3rd Street, Jena, LA (1)	Life Insurance Sales		1,737		100	%

(1)	Included in property and equipment on the consolidated balance sheets

Schedule of Aging of Mortgage Loans

The Company establishes a valuation allowance for credit losses in its mortgage loans held for investment portfolio. The following table presents the valuation allowance for loan losses as a contra-asset account.

	Commercial		Residential			Residential Construction		Total
December 31, 2021
Allowance for credit losses:
Beginning balance	$	187,129	$	1,774,796		$	43,202	$	2,005,127
Charge-offs		-		-			-		-
Provision		-		(305,225	)		-		(305,225	)
Ending balance	$	187,129	$	1,469,571		$	43,202	$	1,699,902

Ending balance: individually evaluated for impairment	$	-	$	105,384		$	-	$	105,384

Ending balance: collectively evaluated for impairment	$	187,129	$	1,364,187		$	43,202	$	1,594,518

Mortgage loans:
Ending balance	$	51,683,022	$	53,533,712		$	175,117,783	$	280,334,517

Ending balance: individually evaluated for impairment	$	1,723,372	$	2,548,656		$	-	$	4,272,028

Ending balance: collectively evaluated for impairment	$	49,959,650	$	50,985,056		$	175,117,783	$	2,760,162,489

December 31, 2020
Allowance for credit losses:
Beginning balance	$	187,129	$	1,222,706		$	43,202	$	1,453,037
Charge-offs		-		-			-		-
Provision		-		552,090			-		552,090
Ending balance	$	187,129	$	1,774,796		$	43,202	$	2,005,127

Ending balance: individually evaluated for impairment	$	-	$	219,905		$	-	$	219,905

Ending balance: collectively evaluated for impairment	$	187,129	$	1,554,891		$	43,202	$	1,785,222

Mortgage loans:
Ending balance	$	46,836,866	$	111,111,777		$	95,822,448	$	253,771,091

Ending balance: individually evaluated for impairment	$	2,148,827	$	7,932,680		$	200,963	$	10,282,470

Ending balance: collectively evaluated for impairment	$	44,688,039	$	103,179,097		$	95,621,485	$	243,488,621

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

2) Investments (Continued)

The following table presents the aging of mortgage loans held for investment.

Schedule of Aging of Mortgage Loans

	Commercial			Residential			Residential Construction			Total
December 31, 2021
30-59 Days Past Due	$	-		$	3,117,826		$	1,363,127		$	4,480,953
60-89 Days Past Due		100,204			580,815			-			681,019
Greater Than 90 Days (1)		1,723,372			2,052,062			-			3,775,434
In Process of Foreclosure (1)		-			496,594			-			496,594
Total Past Due		1,823,576			6,247,297			1,363,127			9,434,000
Current		49,859,446			47,286,415			173,754,656			270,900,517
Total Mortgage Loans		51,683,022			53,533,712			175,117,783			280,334,517
Allowance for Loan Losses		(187,129	)		(1,469,571	)		(43,202	)		(1,699,902	)
Unamortized deferred loan fees, net		(36,813	)		(498,600	)		(383,173	)		(918,586	)
Unamortized discounts, net		(240,614	)		(169,369	)		-			(409,983	)
Net Mortgage Loans	$	51,218,466		$	51,396,172		$	174,691,408		$	277,306,046

December 31, 2020
30-59 Days Past Due	$	233,200		$	5,866,505		$	127,191		$	6,226,896
60-89 Days Past Due		812,780			2,048,148			-			2,860,928
Greater Than 90 Days (1)		2,148,827			5,669,583			-			7,818,410
In Process of Foreclosure (1)		-			2,263,097			200,963			2,464,060
Total Past Due		3,194,807			15,847,333			328,154			19,370,294
Current		43,642,059			79,975,115			110,783,623			234,400,797
Total Mortgage Loans		46,836,866			95,822,448			111,111,777			253,771,091
Allowance for Loan Losses		(187,129	)		(1,774,796	)		(43,202	)		(2,005,127	)
Unamortized deferred loan fees, net		(32,557	)		(909,864	)		(218,711	)		(1,161,132	)
Unamortized discounts, net		(880,721	)		(380,175	)		-			(1,260,896	)
Net Mortgage Loans	$	45,736,459		$	92,757,613		$	110,849,864		$	249,343,936

(1)

Interest income is not recognized on loans past due greater than 90 days or in foreclosure.

Schedule of Aging of Mortgage Loans

The following table presents the aging of mortgage loans held for investment.

Schedule of Aging of Mortgage Loans

	Commercial			Residential			Residential Construction			Total
December 31, 2021
30-59 Days Past Due	$	-		$	3,117,826		$	1,363,127		$	4,480,953
60-89 Days Past Due		100,204			580,815			-			681,019
Greater Than 90 Days (1)		1,723,372			2,052,062			-			3,775,434
In Process of Foreclosure (1)		-			496,594			-			496,594
Total Past Due		1,823,576			6,247,297			1,363,127			9,434,000
Current		49,859,446			47,286,415			173,754,656			270,900,517
Total Mortgage Loans		51,683,022			53,533,712			175,117,783			280,334,517
Allowance for Loan Losses		(187,129	)		(1,469,571	)		(43,202	)		(1,699,902	)
Unamortized deferred loan fees, net		(36,813	)		(498,600	)		(383,173	)		(918,586	)
Unamortized discounts, net		(240,614	)		(169,369	)		-			(409,983	)
Net Mortgage Loans	$	51,218,466		$	51,396,172		$	174,691,408		$	277,306,046

December 31, 2020
30-59 Days Past Due	$	233,200		$	5,866,505		$	127,191		$	6,226,896
60-89 Days Past Due		812,780			2,048,148			-			2,860,928
Greater Than 90 Days (1)		2,148,827			5,669,583			-			7,818,410
In Process of Foreclosure (1)		-			2,263,097			200,963			2,464,060
Total Past Due		3,194,807			15,847,333			328,154			19,370,294
Current		43,642,059			79,975,115			110,783,623			234,400,797
Total Mortgage Loans		46,836,866			95,822,448			111,111,777			253,771,091
Allowance for Loan Losses		(187,129	)		(1,774,796	)		(43,202	)		(2,005,127	)
Unamortized deferred loan fees, net		(32,557	)		(909,864	)		(218,711	)		(1,161,132	)
Unamortized discounts, net		(880,721	)		(380,175	)		-			(1,260,896	)
Net Mortgage Loans	$	45,736,459		$	92,757,613		$	110,849,864		$	249,343,936

(1)

Interest income is not recognized on loans past due greater than 90 days or in foreclosure.

Schedule of Impaired Mortgage Loans

	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
December 31, 2021
With no related allowance recorded:
Commercial	$	1,723,372	$	1,723,372	$	-	$	1,053,865	$	-
Residential		1,591,368		1,591,368		-		2,731,421		-
Residential construction		-		-		-		100,481		-

With an allowance recorded:
Commercial	$	-	$	-	$	-	$	-	$	-
Residential		957,288		957,288		105,384		726,449		-
Residential construction		-		-		-		-		-

Total:
Commercial	$	1,723,372	$	1,723,372	$	-	$	1,053,865	$	-
Residential		2,548,656		2,548,656		105,384		3,457,870		-
Residential construction		-		-		-		100,481		-

December 31, 2020
With no related allowance recorded:
Commercial	$	2,148,827	$	2,148,827	$	-	$	1,866,819	$	-
Residential		6,415,419		6,415,419		-		5,010,078		-
Residential construction		200,963		200,963		-		555,278		-

With an allowance recorded:
Commercial	$	-	$	-	$	-	$	-	$	-
Residential		1,517,261		1,517,261		219,905		1,182,368		-
Residential construction		-		-		-		-		-

Total:
Commercial	$	2,148,827	$	2,148,827	$	-	$	1,866,819	$	-
Residential		7,932,680		7,932,680		219,905		6,192,446		-
Residential construction		200,963		200,963		-		555,278		-

Schedule of Credit Risk of Mortgage Loans Based on Performance Status

The Company’s performing and non-performing mortgage loans held for investment are summarized as follows:

	Commercial				Residential				Residential Construction				Total
	December 31				December 31				December 31				December 31
	2021		2020		2021		2020		2021		2020		2021		2020

Performing	$	49,959,650	$	44,688,039	$	50,985,056	$	87,889,768	$	175,117,783	$	110,910,814	$	276,062,489	$	243,488,621
Non-performing		1,723,372		2,148,827		2,548,656		7,932,680		-		200,963		4,272,028		10,282,470

Total	$	51,683,022	$	46,836,866	$	53,533,712	$	95,822,448	$	175,117,783	$	111,111,777	$	280,334,517	$	253,771,091

Schedule of Mortgage loans Held for Investment

			Principal		Principal		Principal
			Amounts		Amounts		Amounts
			Due in		Due in		Due
	Total		1 Year		2-5 Years		Thereafter
Residential	$	53,533,712	$	7,451,252	$	6,031,628	$	40,050,832
Residential Construction		175,117,783		145,711,262		29,406,521		-
Commercial		51,683,022		17,007,282		25,761,914		8,913,826
Total	$	280,334,517	$	170,169,796	$	61,200,063	$	48,964,658

Loans Held for Sale

12 Months Ended

Dec. 31, 2021

Loans Held For Sale

Loans Held for Sale

3) Loans Held for Sale

The Company elected the fair value option for loans held for sale. Changes in the fair value of the loans are included in mortgage fee income. Interest income is recorded based on the contractual terms of the loan and in accordance with the Company’s policy on mortgage loans held for investment and is included in mortgage fee income on the consolidated statement of earnings. See Note 17 of the Notes to Consolidated Financial Statements for additional disclosures regarding loans held for sale.

The following table presents the aggregate fair value and the aggregate unpaid principal balance of loans held for sale.

	2021		2020
	December 31
	2021		2020
Aggregate fair value	$	302,776,827	$	422,772,418
Unpaid principal balance		294,481,503		406,407,323
Unrealized gain		8,295,324		16,365,095

Mortgage Fee Income

Mortgage fee income consists of origination fees, processing fees, interest income and certain other income related to the origination and sale of mortgage loans held for sale.

Major categories of mortgage fee income for loans held for sale are summarized as follows:

	2021			2020
	Years Ended December 31
	2021			2020
Loan fees	$	37,723,433		$	43,432,532
Interest income		9,385,469			10,628,581
Secondary gains		230,417,029			231,759,342
Change in fair value of loan commitments		(3,113,095	)		7,637,377
Change in fair value of loans held for sale		(8,783,376	)		10,413,492
Provision for loan loss reserve		(2,211,230	)		(4,938,214	)
Mortgage fee income	$	263,418,230		$	298,933,110

Loan Loss Reserve

When a repurchase demand corresponding to a mortgage loan previously held for sale and sold to a third-party investor is received from a third-party investor, the relevant data is reviewed and captured so that an estimated future loss can be calculated. The key factors that are used in the estimated loss calculation are as follows: (i) lien position, (ii) payment status, (iii) claim type, (iv) unpaid principal balance, (v) interest rate, and (vi) validity of the demand. Other data is captured and is useful for management purposes; the actual estimated loss is generally based on these key factors. The Company conducts its own review upon the receipt of a repurchase demand. In many instances, the Company is able to resolve the issues relating to the repurchase demand by the third-party investor without having to make any payments to the investor.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

3) Loans Held for Sale (Continued)

The loan loss reserve, which is included in other liabilities and accrued expenses, is summarized as follows:

	2021			2020
	December 31
	2021			2020
Balance, beginning of period	$	20,583,618		$	4,046,288
Provision for current loan originations (1)		2,211,230			4,938,214
Additional provision for loan loss reserve		-			16,506,030
Charge-offs, net of recaptured amounts		(20,347,709	)		(4,906,914	)
Balance, at December 31	$	2,447,139		$	20,583,618

(1) Included in Mortgage fee income

The Company maintains reserves for estimated losses on current production volumes. For the year ended December 31, 2021, $2,211,230 in reserves were added at a rate of 3.9 basis points per loan, the equivalent of $390 per $1,000,000 in loans originated. This is a decrease over the year ended December 31, 2020, when $4,938,214 in reserves were added at a rate of 8.9 basis points per loan originated, the equivalent of $890 per $1,000,000 in loans originated. The Company also increased its loan loss reserve for the year ended December 31, 2020 by an additional $16,506,030 to account for changes in estimates specific to settlements of loan losses. See Note 10 for additional information regarding mortgage loan loss settlements. The unique nature of COVID-19 creates significant difficulty for forecasting potential future losses. The Company will continue to monitor data and economic conditions in order to maintain adequate loss reserves on current production. Thus, the Company believes that the final loan loss reserve as of December 31, 2021, represents its best estimate for adequate loss reserves on loans sold.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

Consolidated Statements of Stockholders' Equity - USD ($)	Common Stock [Member] Common Class A [Member]	Common Stock [Member] Common Class C [Member]	Additional Paid-in Capital [Member]	AOCI Attributable to Parent [Member]	Retained Earnings [Member]	Treasury Stock [Member]	Total
Beginning balance, value at Dec. 31, 2019	$ 32,215,558	$ 5,001,774	$ 46,091,112	$ 13,726,514	$ 101,256,229	$ (1,580,582)	$ 196,710,605
Net earnings					55,596,613		55,596,613
Other comprehensive income (loss)				9,516,619			9,516,619
Stock based compensation expense			358,878				358,878
Exercise of stock options	137,940	261,640	432,572				832,152
Sale of treasury stock			1,224,877			2,715,071	3,939,948
Purchase of treasury stock						(2,967,761)	(2,967,761)
Stock dividends	810,420	123,440	2,179,814		(3,113,675)		(1)
Conversion Class C to Class A	27,648	(27,648)
Ending balance, value at Dec. 31, 2020	33,191,566	5,359,206	50,287,253	23,243,133	153,739,167	(1,833,272)	263,987,053
Net earnings					39,518,990		39,518,990
Other comprehensive income (loss)				(5,172,685)			(5,172,685)
Stock based compensation expense			118,384				118,384
Exercise of stock options	320,564	209,312	547,549				1,077,425
Sale of treasury stock			250,019			5,757,383	6,007,402
Purchase of treasury stock						(5,769,735)	(5,769,735)
Stock dividends	1,674,820	263,106	6,782,742		(8,720,668)
Conversion Class C to Class A	98,494	(98,494)
Ending balance, value at Dec. 31, 2021	$ 35,285,444	$ 5,733,130	$ 57,985,947	$ 18,070,448	$ 184,537,489	$ (1,845,624)	$ 299,766,834

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

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+ Details

Derivative Instruments

12 Months Ended

Dec. 31, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments

19) Derivative Instruments

The following table shows the fair value and notional amounts of derivative instruments.

		December 31, 2021						December 31, 2020
	Balance Sheet Location	Notional Amount		Asset Fair Value		Liability Fair Value		Notional Amount		Asset Fair Value		Liability Fair Value
Derivatives not designated as hedging instruments:
Loan commitments	Other assets and Other liabilities	$	862,568,967	$	8,563,410	$	1,547,895	$	659,245,038	$	12,592,672	$	2,464,062
Call options	Other liabilities		982,500		—		50,936		1,873,200		—		43,097
Put options	Other liabilities		362,900		—		4,493		—		—		—
Total		$	863,914,367	$	8,563,410	$	1,603,324	$	661,118,238	$	12,592,672	$	2,507,159

The following table presents the gains (losses) on derivatives. There were no gains or losses reclassified from accumulated other comprehensive income into income or gains or losses recognized in income on derivatives ineffective portion or any amounts excluded from effective testing.

		Years ended December 31
Derivative	Classification	2021			2020
Loan commitments	Mortgage fee income	$	(3,113,095	)	$	7,637,377

Call and put options	Gains on investments and other assets	$	160,410		$	272,758

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

Value of Business Acquired, Intangible Assets and Goodwill (Tables)

12 Months Ended

Dec. 31, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Value of Business Acquired

Information with regard to value of business acquired was as follows:

Schedule of Value of Business Acquired

	2021			2020
	December 31
	2021			2020
Balance at beginning of year	$	8,955,249		$	9,876,647
Value of business acquired		586,840			-
Imputed interest at 7% included in earnings		613,028			670,565
Amortization included in earnings		(1,728,157	)		(1,457,390	)
Shadow amortization included in other comprehensive income		(5,528	)		(134,573	)
Net amortization		(1,120,657	)		(921,398	)
Balance at end of year	$	8,421,432		$	8,955,249

Schedule of Carrying Value of Intangible Asset

The carrying value of the Company’s intangible assets were as follows which is included in other assets:

		December 31
	Useful Life	2021			2020
Intangible asset - trade name (1)	15 years	$	2,100,000		$	-
Intangible asset - customer lists	15 years		890,000			890,000
Intangible asset - trade name (2)	15 years		610,000			610,000
Intangible assets - other (1)	15 years		210,000			-
Less accumulated amortization			(297,333	)		(197,334	)
Balance at end of year		$	3,512,667		$	1,302,666

(1)	See Note 20 regarding the acquisition of Rivera Funerals, Cremations and Memorial Gardens

(2)	Kilpatrick Life

Schedule of Goodwill by Segment

Information regarding goodwill by segment was as follows:

Schedule of Goodwill by Segment

	Life Insurance		Cemetery/ Mortuary			Total
Balance at January 1, 2020:
Goodwill	$	2,765,570	$	754,018		$	3,519,588
Accumulated impairment		-		-			-
Total goodwill, net		2,765,570		754,018			3,519,588

Acquisition		-		-			-

Balance at December 31, 2020:
Goodwill		2,765,570		754,018			3,519,588
Accumulated impairment		-		-			-
Total goodwill, net		2,765,570		754,018			3,519,588

Acquisition		-		1,734,195	(1)		1,734,195

Balance at December 31, 2021:
Goodwill		2,765,570		2,488,213			5,253,783
Accumulated impairment		-		-			-
Total goodwill, net	$	2,765,570	$	2,488,213		$	5,253,783

(1)	See Note 20 regarding the acquisition of Rivera Funerals, Cremations and Memorial Gardens and Holbrook Mortuary

Schedule of Credit Risk of Mortgage Loans Based on Performance Status (Details) - USD ($)	Dec. 31, 2021	Dec. 31, 2020
Marketable Securities [Line Items]
Mortgage loans	$ 280,334,517	$ 253,771,091
Commercial Loan [Member]
Marketable Securities [Line Items]
Mortgage loans	51,683,022	46,836,866
Residential Mortgage [Member]
Marketable Securities [Line Items]
Mortgage loans	53,533,712	111,111,777
Residential Construction [Member]
Marketable Securities [Line Items]
Mortgage loans	175,117,783	95,822,448
Performing Financing Receivable [Member]
Marketable Securities [Line Items]
Mortgage loans	276,062,489	243,488,621
Performing Financing Receivable [Member] \| Commercial Loan [Member]
Marketable Securities [Line Items]
Mortgage loans	49,959,650	44,688,039
Performing Financing Receivable [Member] \| Residential Mortgage [Member]
Marketable Securities [Line Items]
Mortgage loans	50,985,056	87,889,768
Performing Financing Receivable [Member] \| Residential Construction [Member]
Marketable Securities [Line Items]
Mortgage loans	175,117,783	110,910,814
Nonperforming Financing Receivable [Member]
Marketable Securities [Line Items]
Mortgage loans	4,272,028	10,282,470
Nonperforming Financing Receivable [Member] \| Commercial Loan [Member]
Marketable Securities [Line Items]
Mortgage loans	1,723,372	2,148,827
Nonperforming Financing Receivable [Member] \| Residential Mortgage [Member]
Marketable Securities [Line Items]
Mortgage loans	2,548,656	7,932,680
Nonperforming Financing Receivable [Member] \| Residential Construction [Member]
Marketable Securities [Line Items]
Mortgage loans		200,963
Performing and Non-Performing [Member]
Marketable Securities [Line Items]
Mortgage loans	280,334,517	253,771,091
Performing and Non-Performing [Member] \| Commercial Loan [Member]
Marketable Securities [Line Items]
Mortgage loans	51,683,022	46,836,866
Performing and Non-Performing [Member] \| Residential Mortgage [Member]
Marketable Securities [Line Items]
Mortgage loans	53,533,712	95,822,448
Performing and Non-Performing [Member] \| Residential Construction [Member]
Marketable Securities [Line Items]
Mortgage loans	$ 175,117,783	$ 111,111,777

Schedule of Impaired Mortgage Loans (Details) - USD ($)	12 Months Ended
Schedule of Impaired Mortgage Loans (Details) - USD ($)	Dec. 31, 2021	Dec. 31, 2020
Commercial Loan [Member]
Marketable Securities [Line Items]
Impaired Financing Receivable, with No Related Allowance, Recorded Investment	$ 1,723,372	$ 2,148,827
Impaired Financing Receivable, with No Related Allowance, Unpaid Principal Balance	1,723,372	2,148,827
Impaired Financing Receivable, with No Related Allowance
Impaired Financing Receivable, with No Related Allowance, Average Recorded Investment	1,053,865	1,866,819
Impaired Financing Receivable, with No Interest Income Recognized
Impaired Financing Receivable, with Related Allowance, Recorded Investment
Impaired Financing Receivable, with Related Allowance, Unpaid Principal Balance
Impaired Financing Receivable, Related Allowance
Impaired Financing Receivable, with Related Allowance, Average Recorded Investment
Impaired Financing Receivable, with Interest Income Recognized
Commercial Loan [Member] \| Total [Member]
Marketable Securities [Line Items]
Impaired Financing Receivable, with Related Allowance, Recorded Investment	1,723,372	2,148,827
Impaired Financing Receivable, with Related Allowance, Unpaid Principal Balance	1,723,372	2,148,827
Impaired Financing Receivable, Related Allowance
Impaired Financing Receivable, with Related Allowance, Average Recorded Investment	1,053,865	1,866,819
Impaired Financing Receivable, with Interest Income Recognized
Residential Mortgage [Member]
Marketable Securities [Line Items]
Impaired Financing Receivable, with No Related Allowance, Recorded Investment	1,591,368	6,415,419
Impaired Financing Receivable, with No Related Allowance, Unpaid Principal Balance	1,591,368	6,415,419
Impaired Financing Receivable, with No Related Allowance
Impaired Financing Receivable, with No Related Allowance, Average Recorded Investment	2,731,421	5,010,078
Impaired Financing Receivable, with No Interest Income Recognized
Impaired Financing Receivable, with Related Allowance, Recorded Investment	957,288	1,517,261
Impaired Financing Receivable, with Related Allowance, Unpaid Principal Balance	957,288	1,517,261
Impaired Financing Receivable, Related Allowance	105,384	219,905
Impaired Financing Receivable, with Related Allowance, Average Recorded Investment	726,449	1,182,368
Impaired Financing Receivable, with Interest Income Recognized
Residential Mortgage [Member] \| Total [Member]
Marketable Securities [Line Items]
Impaired Financing Receivable, with Related Allowance, Recorded Investment	2,548,656	7,932,680
Impaired Financing Receivable, with Related Allowance, Unpaid Principal Balance	2,548,656	7,932,680
Impaired Financing Receivable, Related Allowance	105,384	219,905
Impaired Financing Receivable, with Related Allowance, Average Recorded Investment	3,457,870	6,192,446
Impaired Financing Receivable, with Interest Income Recognized
Residential Construction [Member]
Marketable Securities [Line Items]
Impaired Financing Receivable, with No Related Allowance, Recorded Investment		200,963
Impaired Financing Receivable, with No Related Allowance, Unpaid Principal Balance		200,963
Impaired Financing Receivable, with No Related Allowance
Impaired Financing Receivable, with No Related Allowance, Average Recorded Investment	100,481	555,278
Impaired Financing Receivable, with No Interest Income Recognized
Impaired Financing Receivable, with Related Allowance, Recorded Investment
Impaired Financing Receivable, with Related Allowance, Unpaid Principal Balance
Impaired Financing Receivable, Related Allowance
Impaired Financing Receivable, with Related Allowance, Average Recorded Investment
Impaired Financing Receivable, with Interest Income Recognized
Residential Construction [Member] \| Total [Member]
Marketable Securities [Line Items]
Impaired Financing Receivable, with Related Allowance, Recorded Investment		200,963
Impaired Financing Receivable, with Related Allowance, Unpaid Principal Balance		200,963
Impaired Financing Receivable, Related Allowance
Impaired Financing Receivable, with Related Allowance, Average Recorded Investment	100,481	555,278
Impaired Financing Receivable, with Interest Income Recognized

Significant Accounting Policies

12 Months Ended

Dec. 31, 2021

Accounting Policies [Abstract]

Significant Accounting Policies

1) Significant Accounting Policies

General Overview of Business

Security National Financial Corporation and its wholly owned subsidiaries (the “Company”) operate in three reportable business segments: life insurance, cemetery and mortuary, and mortgages. The life insurance segment is engaged in the business of selling and servicing selected lines of life insurance, annuity products and accident and health insurance marketed primarily in the states located in western, mid-western and southern regions of the United States. The cemetery and mortuary segment of the Company consists of eleven mortuaries and five cemeteries in Utah, one cemetery in California, and four mortuaries and one cemetery in New Mexico. The mortgage segment is an approved government and conventional lender that originates and underwrites residential and commercial loans for new construction, existing homes and real estate projects primarily in Florida, Nevada, Texas, and Utah.

Basis of Presentation

The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (GAAP).

Principles of Consolidation

These consolidated financial statements include the financial statements of the Company and its majority owned subsidiaries. All intercompany transactions and accounts have been eliminated in consolidation.

Use of Estimates

Management of the Company has made a number of estimates and assumptions related to the reported amounts of assets and liabilities, reported amounts of revenues and expenses, and the disclosure of contingent assets and liabilities to prepare these financial statements in conformity with GAAP. Actual results could differ from those estimates.

Material estimates that are particularly susceptible to significant changes in the near term are those used in determining the value of derivative assets and liabilities; those used in determining deferred acquisition costs and the value of business acquired; those used in determining the value of mortgage loans foreclosed to real estate held for investment; those used in determining the liability for future policy benefits; those used in determining the value of mortgage servicing rights; those used in determining allowances for loan losses for mortgage loans held for investment; those used in determining loan loss reserve; and those used in determining deferred tax assets and liabilities. Although some variability is inherent in these estimates, management believes the amounts provided are fairly stated in all material respects.

Investments

The Company’s management determines the appropriate classifications of investments in fixed maturity securities and equity securities at the acquisition date and re-evaluates the classifications at each balance sheet date.

Fixed maturity securities available for sale are carried at estimated fair value. Changes in fair values are reported as unrealized gains or losses and are recorded in accumulated other comprehensive income.

Equity securities are carried at estimated fair value. Changes in fair values are reported as unrealized gains or losses and are recorded through net earnings as a component of gains on investments and other assets.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

1) Significant Accounting Policies (Continued)

Mortgage loans held for investment are carried at their unpaid principal balances adjusted for net deferred fees, net discounts, charge-offs and the related allowance for loan losses. Interest income is included in net investment income on the consolidated statements of earnings and is recognized when earned. The Company defers related loan origination fees, net of related direct loan origination costs, and amortizes the net fees over the term of the loans. Origination fees are included in net investment income on the consolidated statements of earnings. Mortgage loans are secured by the underlying property and require an appraisal at the time of underwriting and funding. Generally, the Company will fund a loan not to exceed 80% of the loan’s collateral fair market value. Amounts over 80% will require additional collateral or mortgage insurance by an approved third-party insurer.

Real estate held for investment is carried at cost, less accumulated depreciation provided on a straight-line basis over the estimated useful lives of the properties, or is adjusted to a new basis for impairment in value, if any. Included are foreclosed properties which the Company intends to hold for investment purposes. These properties are recorded at the lower of cost or fair value upon foreclosure. Also, included are residential subdivision land developments which are carried at cost.

Real estate held for sale is carried at lower of cost or fair value. Depreciation is not recognized on real estate classified as held for sale.

Other investments and policy loans are carried at the aggregate unpaid balances, less allowances for losses.

Accrued investment income refers to earned income from investments that has not yet been received by the Company.

Gains and losses on investments (except for equity securities carried at fair value through net earnings) arise when investments are sold (as determined on a specific identification basis) or are other than temporarily impaired. If in management’s judgment a decline in the value of an investment below cost is other than temporary, the cost of the investment is written down to fair value with a corresponding charge to earnings. Factors considered in judging whether an impairment is other than temporary include: the financial condition, business prospects and credit worthiness of the issuer, the length of time that fair value has been less than cost, the relative amount of the decline, and the Company’s ability and intent to hold the investment until the fair value recovers, which is not assured.

Cash and Cash Equivalents

The Company considers all highly liquid instruments purchased with an original maturity of three months or less to be cash equivalents. The Company maintains its cash in bank deposit accounts, which at times exceed federally insured limits. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk on cash and cash equivalents.

Loans Held for Sale

Accounting Standards Codification (“ASC”) No. 825, “Financial Instruments”, allows for the option to report certain financial assets and liabilities at fair value initially and at subsequent measurement dates with changes in fair value included in earnings. The option may be applied instrument by instrument, but it is irrevocable. The Company elected the fair value option for loans held for sale. The Company believes the fair value option most closely aligns the timing of the recognition of gains and costs. These loans are intended for sale and the Company believes that the fair value is the best indicator of the resolution of these loans. Electing fair value also reduces certain timing differences and better matches changes in the fair value of these assets with changes in the fair value of the related derivatives used for these assets. See Note 3 and Note 17 to Consolidated Financial Statements for additional disclosures regarding loans held for sale.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

1) Significant Accounting Policies (Continued)

Mortgage Fee Income

Mortgage fee income consists of origination fees, processing fees, interest income and certain other income related to the origination of mortgage loans held for sale. All revenues and costs are recognized when the mortgage loan is funded and any changes in fair value are shown as a component of mortgage fee income. See Note 3 and Note 17 to Consolidated Financial Statements for additional disclosures regarding loans held for sale.

The Company, through its mortgage subsidiaries, sells mortgage loans to third-party investors without recourse unless defects are identified in the representations and warranties made at loan sale. It may be required, however, to repurchase a loan or pay a fee instead of repurchase under certain events, which include the following:

	●	Failure to deliver original documents specified by the investor,
	●	The existence of misrepresentation or fraud in the origination of the loan,
	●	The loan becomes delinquent due to nonpayment during the first several months after it is sold,
	●	Early pay-off of a loan, as defined by the agreements,
	●	Excessive time to settle a loan,
	●	Investor declines purchase, and
	●	Discontinued product and expired commitment.

Loan purchase commitments generally specify a date 30 to 45 days after delivery upon which the underlying loans should be settled. Depending on market conditions, these commitment settlement dates can be extended at a cost to the Company.

It is the Company’s policy to cure any documentation problems regarding such loans at a minimal cost for up to a six-month time period and to pursue efforts to enforce loan purchase commitments from third-party investors concerning the loans. The Company believes that six months allows adequate time to remedy any documentation issues, to enforce purchase commitments, and to exhaust other alternatives. Remedial methods include the following:

	●	Research reasons for rejection,
	●	Provide additional documents,
	●	Request investor exceptions,
	●	Appeal rejection decision to purchase committee, and
	●	Commit to secondary investors.

Once purchase commitments have expired and other alternatives to remedy are exhausted, which could be earlier than the six-month time period, the loans are repurchased and transferred to the long-term investment portfolio at the lower of cost or fair value and previously recorded mortgage fee income that was to be received from a third-party investor is written off against the loan loss reserve.

Determining Fair Value

Cost for loans held for sale is equal to the amount paid to the warehouse bank and the amount originally funded by the Company. Fair value is often difficult to determine and may contain significant unobservable inputs, but is based on the following:

	●	For loans that are committed, the Company uses the commitment price.
	●	For loans that are non-committed that have an active market, the Company uses the market price.
	●	For loans that are non-committed where there is no market but there is a similar product, the Company uses the market value for the similar product.
	●	For loans that are non-committed where no active market exists, the Company determines that the unpaid principal balance best approximates the market value, after considering the fair value of the underlying real estate collateral, estimated future cash flows, and the loan interest rate.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

1) Significant Accounting Policies (Continued)

The appraised value of the real estate underlying the original mortgage loan adds support to the Company’s determination of fair value because if the loan becomes delinquent, the Company has sufficient value to collect the unpaid principal balance or the carrying value of the loan, thus minimizing credit losses.

The majority of loans originated are sold to third-party investors. The amounts expected to be sold to investors are shown on the consolidated balance sheets as loans held for sale.

Loan Loss Reserve

The loan loss reserve is an estimate of probable losses at the balance sheet date that the Company will realize in the future on loans sold. The Company may be required to reimburse third-party investors for costs associated with early payoff of loans within six months of origination of such loans and to repurchase loans where there is a default in any of the first four monthly payments to the investors or, in lieu of repurchase, to pay a negotiated fee to the investors. The Company’s estimates are based upon historical loss experience and the best estimate of the probable loan loss liabilities.

Upon completion of a transfer that satisfies the conditions to be accounted for as a sale, the Company initially measures at fair value liabilities incurred in a sale relating to any guarantee or recourse provisions. The Company accrues a monthly allowance for indemnification losses to investors based on total production. This estimate is based on the Company’s historical experience and is included as a component of mortgage fee income. Subsequent updates to the recorded liability from changes in assumptions are recorded in selling, general and administrative expenses as a component of provision for loan loss reserve. The estimated liability for indemnification losses is included in other liabilities and accrued expenses.

The loan loss reserve analysis involves mortgage loans that have been sold to third-party investors, which were believed to have met investor underwriting guidelines at the time of sale, where the Company has received a demand from the investor. There are generally three types of demands: make whole, repurchase, or indemnification. These types of demands are further described as follows:

Make whole demand — A make whole demand occurs when an investor forecloses on a property and then sells the property. The make whole amount is calculated as the difference between the original unpaid principal balance, payments received, accrued interest and fees, less the sale proceeds.

Repurchase demand — A repurchase demand usually occurs when there is a significant payment default, error in underwriting or detected loan fraud.

Indemnification demand — On certain loans the Company has negotiated a set fee that is to be paid in lieu of repurchase. The fee varies by investor and by loan product type.

The Company believes the allowance for loan losses and the loan loss reserve represent probable loan losses incurred as of the balance sheet date.

Additional information related to the Loan Loss Reserve is included in Note 3.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

1) Significant Accounting Policies (Continued)

Restricted Assets

Restricted assets are assets held in a trust account for future mortuary services and merchandise and consist of cash and cash equivalents; participations in mortgage loans held for investment with Security National Life Insurance Company (“Security National Life”); mutual funds carried at estimated fair value; equity securities carried at estimated fair value; and a surplus note with Security National Life (which is eliminated in consolidation). Restricted assets also include escrows held for borrowers and investors under servicing and appraisal agreements relating to mortgage loans, funds held by warehouse banks in accordance with loan purchase agreements and funds held in escrow for certain real estate construction development projects. Additionally, the Company funded its medical benefit safe-harbor limit based on the qualified direct costs, and has included this amount as a component of restricted cash.

Cemetery Perpetual Care Trust Investments

Cemetery endowment care trusts have been set up for five of the seven cemeteries owned by the Company. Under endowment care arrangements a portion of the price for each lot sold is withheld and invested in a portfolio of investments similar to those described in the prior paragraph. The earnings stream from the investments is designed to fund future maintenance and upkeep of the cemetery.

Cemetery Land and Improvements

The development of a cemetery involves not only the initial acquisition of raw land but also the installation of roads, water lines, landscaping and other costs to establish a marketable cemetery lot. The costs of developing the cemetery are shown as an asset on the balance sheet. The amount on the balance sheet is reduced by the total cost assigned to the development of a particular lot when the criterion for recognizing a sale of that lot is met.

Deferred Policy Acquisition Costs and Value of Business Acquired

Commissions and other costs, net of commission and expense allowances for reinsurance ceded, that vary with and are primarily related to the production of new insurance business have been deferred. Deferred policy acquisition costs (“DAC”) for traditional life insurance are amortized over the premium paying period of the related policies using assumptions consistent with those used in computing policy benefit reserves. For interest-sensitive insurance products, deferred policy acquisition costs are amortized generally in proportion to the present value of expected gross profits from surrender charges, investment, mortality and expense margins. This amortization is adjusted when estimates of current or future gross profits to be realized from a group of products are reevaluated. Deferred acquisition costs are written off when policies lapse or are surrendered.

When accounting for DAC, the Company considers internal replacements of insurance and investment contracts. An internal replacement is a modification in product benefits, features, rights or coverage that occurs by the exchange of a contract for a new contract, or by amendment, endorsement, or rider to contract, or by the election of a feature or coverage within a contract. Modifications that result in a replacement contract that is substantially changed from the replaced contract are accounted for as an extinguishment of the replaced contract. Unamortized DAC, unearned revenue liabilities and deferred sales inducements from the replaced contract are written-off. Modifications that result in a contract that is substantially unchanged from the replaced contract are accounted for as a continuation of the replaced contract.

Value of business acquired (“VOBA”) is the present value of estimated future profits of the acquired business and is amortized similar to deferred policy acquisition costs.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

1) Significant Accounting Policies (Continued)

Premium Deficiency and Loss Recognition Testing

At least annually, the Company tests the adequacy of the net benefit reserves (liability for future policy benefits, net of DAC and VOBA) recorded for life insurance and annuity products. The Company tests for recoverability by using the Company’s current best-estimate assumptions as to policyholder mortality, persistency, maintenance expenses and invested asset returns. These tests evaluate whether the present value of future contract-related cash flows will support the capitalized DAC and VOBA assets. These cash flows consist primarily of premium income, less benefits and expenses. If the current contract liabilities plus the present value of future premiums is greater than the sum of the present values of future policy benefits, commissions, and expenses plus the current DAC and VOBA less unearned premium reserve balances, then the capitalized assets are deemed recoverable. The present values are calculated using the best estimate of the after tax net investment earned rate.

Mortgage Servicing Rights

Mortgage Servicing Rights (“MSR”) arise from contractual agreements between the Company and third-party investors (or their agents) when mortgage loans are sold. Under these contracts, the Company is obligated to retain and provide loan servicing functions on loans sold, in exchange for fees and other remuneration. The servicing functions typically performed include, among other responsibilities, collecting and remitting loan payments; responding to borrower inquiries; accounting for principal and interest, holding custodial (impound) funds for payment of property taxes and insurance premiums; counseling delinquent mortgagors; and supervising the acquisition of real estate owned and property dispositions.

The total residential mortgage loans serviced for others consist primarily of agency conforming fixed-rate mortgage loans. The value of MSRs is derived from the net cash flows associated with the servicing contracts. The Company receives a servicing fee of generally about 0.250% annually on the remaining outstanding principal balances of the loans. Based on the result of the cash flow analysis, an asset or liability is recorded for mortgage servicing rights. The servicing fees are collected from the monthly payments made by the mortgagors. The Company generally receives other remuneration including rights to various mortgagor-contracted fees such as late charges, and collateral reconveyance charges and the Company is generally entitled to retain the interest earned on funds held pending remittance of mortgagor principal, interest, tax and insurance payments. Contractual servicing fees and late fees are included in other revenues on the consolidated statements of earnings.

The Company’s subsequent accounting for MSRs is based on the class of MSRs. The Company has identified two classes of MSRs: MSRs backed by mortgage loans with initial term of 30 years and MSRs backed by mortgage loans with initial term of 15 years. The Company distinguishes between these classes of MSRs due to their differing sensitivities to change in value as the result of changes in market. After being initially recorded at fair value, MSRs backed by mortgage loans are accounted for using the amortization method. Amortization expense is included in other expenses on the consolidated statements of earnings. MSR amortization is determined by amortizing the MSR balance in proportion to, and over the period of the estimated future net servicing income of the underlying financial assets.

Interest rate risk, prepayment risk, and default risk are inherent risks in MSR valuation. Interest rate changes largely drive prepayment rates. Refinance activity generally increases as rates decline. A significant decrease in rates beyond expectation could cause a decline in the value of the MSR. On the contrary, if rates increase borrowers are less likely to refinance or prepay their mortgage, which extends the duration of the loan and MSR values are likely to rise. Because of these risks, discount rates and prepayment speeds are used to estimate the fair value.

The Company periodically assesses MSRs for impairment. Impairment occurs when the current fair value of the MSR falls below the asset’s carrying value (carrying value is the amortized cost reduced by any related valuation allowance). If MSRs are impaired, the impairment is recognized in current period earnings and the carrying value of the MSRs is adjusted through a valuation allowance.

Management periodically reviews the various loan strata to determine whether the value of the MSRs in a given stratum is impaired and likely to recover. When management deems recovery of the value to be unlikely in the foreseeable future, a write-down of the cost of the MSRs for that stratum to its estimated recoverable value is charged to the valuation allowance.

Property and Equipment

Property and equipment are recorded at cost. Depreciation is calculated principally on the straight-line method over the estimated useful lives of the assets which range from three to forty years. Leasehold improvements paid for by the Company as a lessee are amortized over the lesser of the useful life or remaining lease terms.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

1) Significant Accounting Policies (Continued)

Long-lived Assets

Long-lived assets to be held and used, including property and equipment and real estate held for investment, are reviewed for impairment whenever events or changes in circumstances indicate that the related carrying amount may not be recoverable. When required, impairment losses on assets to be held and used are recognized based on the fair value of the asset, and long-lived assets to be disposed of are reported at the lower of carrying amount or fair value less costs to sell. No impairment of long-lived assets has been recognized in the accompanying financial statements except for certain impairments of real estate held for investment as disclosed in Note 2.

Derivative Instruments

Mortgage Banking Derivatives

Loan Commitments

The Company is exposed to price risk due to the potential impact of changes in interest rates on the values of loan commitments from the time a loan commitment is made to an applicant to the time the loan that would result from the exercise of that loan commitment is funded. Managing price risk is complicated by the fact that the ultimate percentage of loan commitments that will be exercised (i.e., the number of loans that will be funded) fluctuates. The probability that a loan will not be funded or the loan application is denied or withdrawn within the terms of the commitment is driven by a number of factors, particularly the change, if any, in mortgage rates following the issuance of the loan commitment.

In general, the probability of funding increases if mortgage rates rise and decreases if mortgage rates fall. This is due primarily to the relative attractiveness of current mortgage rates compared to the applicant’s committed rate. The probability that a loan will not be funded within the terms of the mortgage loan commitment also is influenced by the source of the applications (retail, broker or correspondent channels), proximity to rate lock expiration, purpose for the loan (purchase or refinance), product type and the application approval status. The Company has developed fallout estimates using historical data that take into account all of the variables, as well as renegotiations of rate and point commitments that tend to occur when mortgage rates fall. These fallout estimates are used to estimate the number of loans that the Company expects to be funded within the terms of the loan commitments and are updated periodically to reflect the most current data.

The Company estimates the fair value of a loan commitment based on the change in estimated fair value of the underlying mortgage loan, quoted mortgage-backed securities (“MBS”) prices, estimates of the fair value of mortgage servicing rights, and an estimate of the probability that the mortgage loan will fund within the terms of the commitment. The change in fair value of the underlying mortgage loan is measured from the date the loan commitment is issued and is shown net of expenses. Following issuance, the value of a loan commitment can be either positive or negative depending upon the change in value of the underlying mortgage loans.

Forward Sale Commitments

The Company utilizes forward commitments to economically hedge the price risk associated with its outstanding mortgage loan commitments. A forward commitment protects the Company from losses on sales of the loans arising from exercise of the loan commitments. Management expects these types of commitments will experience changes in fair value opposite to changes in fair value of the loan commitments, thereby reducing earnings volatility related to the recognition in earnings of changes in the values of the commitments.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

1) Significant Accounting Policies (Continued)

The net changes in fair value of loan commitments and forward sale commitments are shown in current earnings as a component of mortgage fee income on the consolidated statements of earnings. Mortgage banking derivatives are shown in other assets and other liabilities and accrued expenses on the consolidated balance sheets.

Call and Put Option Derivatives

The Company uses a strategy of selling “out of the money” call options on its equity securities as a source of revenue. The options give the purchaser the right to buy from the Company specified equity securities at a set price up to a pre-determined date in the future. The Company uses the strategy of selling put options as a means of generating cash or purchasing equity securities at lower than current market prices. The Company receives an immediate payment of cash for the value of the option and establishes a liability for the fair value of the option. The liability for options is adjusted to fair value at each reporting date. In the event a call option is exercised, the Company sells the equity security at a favorable price enhanced by the value of the option that was sold. If the option expires unexercised, the Company recognizes a gain from the expired option. In the event a put option is exercised, the Company acquires an equity security at the strike price of the option reduced by the value received from the sale of the put option. The equity security is then treated as a normal equity security in the Company’s portfolio. The net changes in the fair value of call and put options are shown in current earnings as a component of gains (losses) on investments and other assets. Call and put options are shown in other liabilities and accrued expenses on the consolidated balance sheets.

Allowance for Doubtful Accounts and Loan Losses and Impaired Loans

The Company records an allowance and recognizes an expense for potential losses from mortgage loans held for investment, other investments and receivables in accordance with GAAP.

Receivables are the result of cemetery and mortuary operations, mortgage loan operations and life insurance operations. The allowance is based upon the Company’s historical experience for collectively evaluated impairment. Other allowances are based upon receivables individually evaluated for impairment. Collectability of the cemetery and mortuary receivables is significantly influenced by current economic conditions. The critical issues that impact recovery of mortgage loan operations are interest rate risk, loan underwriting, new regulations and the overall economy.

The Company provides for losses on its mortgage loans held for investment through an allowance for loan losses (a contra-asset account). The allowance is comprised of two components. The first component is an allowance for collectively evaluated impairment that is based upon the Company’s historical experience in collecting similar receivables. The second component is based upon individual evaluation of loans that are determined to be impaired. As a practical expedient, upon determining impairment, the Company establishes an individual impairment allowance based upon an assessment of the fair value of the underlying collateral. See the schedules in Note 2 for additional information. In addition, when a mortgage loan is past due more than 90 days, the Company does not accrue any interest income. When a loan becomes delinquent, the Company proceeds to foreclose on the real estate and all expenses for foreclosure are expensed as incurred. Once foreclosed, an adjustment for the lower of cost or fair value is made, if necessary, and the amount is classified as real estate held for investment. The Company will rent the properties until it is deemed desirable to sell them.

The allowance for losses on mortgage loans held for investment could change based on changes in the value of the underlying collateral, the performance status of the loans, or the Company’s actual collection experience. The actual losses could change, in the near term, from the established allowance, based upon the occurrence or non-occurrence of these events.

For purposes of determining the allowance for losses, the Company has segmented its mortgage loans held for investment by loan type. The Company’s loan types are commercial, residential, and residential construction. The inherent risks within the portfolio vary depending upon the loan type as follows:

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

1) Significant Accounting Policies (Continued)

Commercial — Underwritten in accordance with the Company’s policies to determine the borrower’s ability to repay the obligation as agreed. Commercial loans are made primarily based on the underlying collateral supporting the loan. Accordingly, the repayment of a commercial loan depends primarily on the collateral and its ability to generate income and secondary on the borrower’s (or guarantors) ability to repay.

Residential — Secured by family dwelling units. These loans are secured by first and second mortgages on the unit. The borrower’s ability to repay is sensitive to the life events and general economic condition of the region. Where loan to values exceed 80%, the loan is generally guaranteed by private mortgage insurance, FHA or VA.

Residential construction (including land acquisition and development) — Underwritten in accordance with the Company’s underwriting policies which include a financial analysis of the builders, borrowers (guarantors), construction cost estimates, and independent appraisal valuations. These loans will rely on the value associated with the project upon completion. These cost and valuation estimates may be inaccurate. Construction loans generally involve the disbursement of substantial funds over a short period of time with repayment substantially dependent upon the success of the completed project and the ability of the borrower to secure long-term financing. Additionally, land is underwritten according to the Company’s policies, which include independent appraisal valuations as well as the estimated value associated with the land upon completion of development into finished lots. These cost and valuation estimates may be inaccurate. These loans are considered to be of a higher risk than other mortgage loans due to their ultimate repayment being sensitive to general economic conditions, availability of long-term or construction financing, and interest rate sensitivity.

Future Policy Benefits and Unpaid Claims

Future policy benefit reserves for traditional life insurance are computed using a net level method, including assumptions as to investment yields, mortality, morbidity, withdrawals, and other assumptions based on the life insurance subsidiaries’ experience, modified as necessary to give effect to anticipated trends and to include provisions for possible unfavorable deviations. Such liabilities are, for some plans, graded to equal statutory values or cash values at or prior to maturity, which are deemed a reasonable equivalent for GAAP. The range of assumed interest rates for all traditional life insurance policy reserves was 4% to 10%. Benefit reserves for traditional limited-payment life insurance policies include the deferred portion of the premiums received during the premium-paying period. Deferred premiums are recognized as income over the life of the policies. Policy benefit claims are charged to expense in the period the claims are incurred. Increases in future policy benefits are charged to expense.

Future policy benefit reserves for interest-sensitive insurance products are computed under a retrospective deposit method and represent policy account balances before applicable surrender charges. Policy benefits and claims that are charged to expense include benefit claims incurred in the period in excess of related policy account balances. Interest crediting rates for interest-sensitive insurance products ranged from 3% to 6.5%.

The Company records an unpaid claims liability for claims in the course of settlement equal to the death benefit amount less any reinsurance recoverable amount for claims reported. There is also an unpaid claims liability for claims incurred but not reported. This liability is based on the historical experience of the net amount of claims that were reported in reporting periods subsequent to the reporting period when claims were incurred.

Participating Insurance

Participating business constituted 2% of insurance in force for the years ended 2021 and 2020. The provision for policyholders’ dividends included in policyholder obligations is based on dividend scales anticipated by management. Amounts to be paid are determined by the Board of Directors.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

1) Significant Accounting Policies (Continued)

Recognition of Insurance Premiums and Other Considerations

Premiums and other consideration for traditional life insurance products (which include those products with fixed and guaranteed premiums and benefits and consist principally of whole life insurance policies, limited payment life insurance policies, and certain annuities with life contingencies) are recognized as revenues when due from policyholders. Premiums and other consideration for interest-sensitive insurance policies (which include universal life policies, interest-sensitive life policies, deferred annuities, and annuities without life contingencies) are recognized when earned and consist of amounts assessed against policyholder account balances during the period for policy administration charges and surrender charges.

Reinsurance

The Company follows the procedure of reinsuring risks in excess of $100,000 to provide for greater diversification of business to allow management to control exposure to potential losses arising from large risks, and provide additional capacity for growth. The Company remains liable for amounts ceded in the event the reinsurers are unable to meet their obligations.

The Company entered into coinsurance agreements with unaffiliated insurance companies under which the Company assumed 100% of the risk for certain life insurance policies and certain other policy-related liabilities of the insurance company.

Reinsurance premiums, commissions, expense reimbursements, and reserves related to reinsured business are accounted for on a basis consistent with those used in accounting for the original policies issued and the terms of the reinsurance contracts. Expense allowances received in connection with reinsurance ceded are accounted for as a reduction of the related policy acquisition costs and are deferred and amortized accordingly.

Pre-need Sales and Costs

Pre-need contract sales of funeral services and caskets - revenue and costs associated with the sales of pre-need funeral services and caskets are deferred until the performance obligations are fulfilled (services are performed or the caskets are delivered).

Sales of cemetery interment rights (cemetery burial property) - revenue and costs associated with the sale of cemetery interment rights are deferred until 10% of the sales price has been collected.

Pre-need contract sales of cemetery merchandise (primarily markers and vaults) - revenue and costs associated with the sale of pre-need cemetery merchandise is deferred until the merchandise is delivered to the Company.

Pre-need contract sales of cemetery services (primarily merchandise delivery, installation fees and burial opening and closing fees) - revenue and costs associated with the sales of pre-need cemetery services are deferred until the services are performed.

Prearranged funeral and pre-need cemetery customer acquisition costs - costs incurred related to obtaining new pre-need contract cemetery and prearranged funeral services, which include only costs that vary with and are primarily related to the acquisition of new pre-need cemetery and prearranged funeral services, are deferred until the merchandise is delivered or services are performed.

Revenues and costs for at-need sales are recorded when a valid contract exists, the services are performed, collection is reasonably assured and there are no significant performance obligations remaining.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

1) Significant Accounting Policies (Continued)

The Company, through its cemetery and mortuary operations, provides guaranteed funeral arrangements wherein a prospective customer can receive future goods and services at guaranteed prices. To accomplish this, the Company, through its life insurance operations, sells to the customer an increasing benefit life insurance policy that is assigned to the mortuaries. If, at the time of need, the policyholder/potential mortuary customer utilizes one of the Company’s facilities, the guaranteed funeral arrangement contract that has been assigned will provide the funeral goods and services at the contracted price. The increasing life insurance policy will cover the difference between the original contract prices and current prices. Risks may arise if the difference cannot be fully met by the life insurance policy. However, management believes that given current inflation rates and related price increases of goods and services, the risk of exposure is minimal.

Goodwill

Previous acquisitions have been accounted for as purchases under which assets acquired and liabilities assumed were recorded at their fair values with the excess purchase price recognized as goodwill. The Company evaluates annually or when changes in circumstances warrant the recoverability of goodwill and if there is a decrease in value, the related impairment is recognized as a charge against income. No impairment of goodwill has been recognized in the accompanying financial statements.

Other Intangibles

Other intangibles are recognized apart from goodwill whenever an acquired intangible asset arises from contractual or other legal rights, or whenever it is capable of being separated or divided from the acquired entity and sold, transferred, licensed, rented, or exchanged, either individually or in combination with a related contract, asset, or liability. The Company engages a third-party valuation firm to analyze the value of the intangible assets that result from significant acquisitions. The value of the intangible assets that result from these acquisitions are included in Other Assets and are determined using the income approach, relying on a relief from the royalty method.

Income Taxes

Income taxes include taxes currently payable plus deferred taxes. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to the temporary differences in the financial reporting basis and tax basis of assets and liabilities and operating loss carry-forwards. Deferred tax assets are measured using enacted tax rates expected to apply to taxable income in the years in which these temporary differences are expected to be recovered or settled.

Liabilities are established for uncertain tax positions expected to be taken in income tax returns when such positions are judged to meet the “more-likely-than-not” threshold based on the technical merits of the positions. Estimated interest and penalties related to uncertain tax penalties are included as a component of income tax expense.

Earnings Per Common Share

The Company computes earnings per share which requires presentation of basic and diluted earnings per share. Basic earnings per equivalent Class A common share are computed by dividing net earnings by the weighted-average number of Class A common shares outstanding during each year presented, after the effect of the assumed conversion of Class C common stock to Class A common stock. Diluted earnings per share is computed by dividing net earnings by the weighted-average number of common shares outstanding during the year used to compute basic earnings per share plus dilutive potential incremental shares. Basic and diluted earnings per share amounts have been adjusted retroactively for the effect of annual stock dividends.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

1) Significant Accounting Policies (Continued)

Stock Based Compensation

The cost of employee services received in exchange for an award of equity instruments is recognized in the financial statements and is measured based on the fair value on the grant date of the award. The fair value of stock options is calculated using the Black Scholes Option Pricing Model. Stock option compensation expense is recognized over the period during which an employee is required to provide service in exchange for the award and is included in personnel expenses on the consolidated statements of earnings.

Concentration of Credit Risk

For a description of the concentration risk regarding available for sale debt securities, mortgage loans held for investment and real estate held for investment, refer to Note 2 of the Notes to Consolidated Financial Statements.

Advertising

The Company expenses advertising costs as incurred.

Recent Accounting Pronouncements

Accounting Standards Issued But Not Yet Adopted

ASU No. 2016-13: “Financial Instruments – Credit Losses (Topic 326)” — Issued in September 2016, ASU 2016-13 amends guidance on reporting credit losses for assets held at amortized cost basis (such as mortgage loans and held to maturity debt securities) and available for sale debt securities. For assets held at amortized cost basis, Topic 326 eliminates the probable initial recognition threshold in current GAAP and, instead, requires an entity to reflect its current estimate of all expected credit losses. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial assets to present the net amount expected to be collected. For available for sale debt securities, credit losses should be measured in a manner similar to current GAAP; however, Topic 326 will require that credit losses be presented as an allowance rather than as a write-down. In October 2019, the FASB proposed an update to ASU No. 2016-13 that would make the ASU effective for the Company on January 1, 2023. The Company is in the process of evaluating the potential impact of this standard.

ASU No. 2018-12: “Financial Services – Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts” — Issued in August 2018, ASU 2018-12 is intended to improve the timeliness of recognizing changes in the liability for future policy benefits on traditional long-duration contracts by requiring that assumptions be updated after contract inception and by modifying the rate used to discount future cash flows. The ASU will improve the accounting for certain market-based options or guarantees associated with deposit or account balance contracts, simplify amortization of deferred acquisition costs while improving and expanding required disclosures. In November 2020, the FASB issued an update to ASU No. 2018-12 that made the ASU effective for the Company on January 1, 2025. The Company has made progress in the implementation of the new standard, including the involvement of actuaries, accountants, and systems specialists. However, the Company has not yet estimated the impact the new guidance will have on the consolidated financial statements.

The Company has reviewed other recent accounting pronouncements and has determined that they will not significantly impact the Company’s results of operations or financial position.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

Mortgage Servicing Rights (Tables)

12 Months Ended

Dec. 31, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Mortgage Servicing Rights

The following table presents the MSR activity.

Schedule of Mortgage Servicing Rights

	2021			2020
	December 31
	2021			2020
Amortized cost:
Balance before valuation allowance at beginning of year	$	35,210,516		$	17,155,529
MSR additions resulting from loan sales		32,701,819			29,896,465
Amortization (1)		(14,851,880	)		(11,841,478	)
Application of valuation allowance to write down MSRs with other than temporary impairment		-			-
Balance before valuation allowance at year end	$	53,060,455		$	35,210,516

Valuation allowance for impairment of MSRs:
Balance at beginning of year	$	-		$	-
Additions		-			-
Application of valuation allowance to write down MSRs with other than temporary impairment		-			-
Balance at year end	$	-		$	-

Mortgage servicing rights, net	$	53,060,455		$	35,210,516

Estimated fair value of MSRs at year end	$	68,811,809		$	38,702,358

(1)

Included in other expenses on the consolidated statements of earnings

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense, Mortgage Servicing Rights

	Estimated MSR Amortization
2022	$	7,341,097
2023		6,020,240
2024		5,263,053
2025		4,583,231
2026		4,008,838
Thereafter		25,843,996
Total	$	53,060,455

Schedule of Other Revenues

The Company collected the following contractual servicing fee income and late fee income as reported in other revenues on the consolidated statements of earnings.

Schedule of Other Revenues

	Years Ended December 31
	2021		2020
Contractual servicing fees	$	15,471,307	$	8,940,612
Late fees		321,337		305,962
Total	$	15,792,644	$	9,246,574

Summary of Unpaid Principal Balances of the Servicing Portfolio

The following is a summary of the unpaid principal balances (“UPB”) of the servicing portfolio.

	December 31
	2021		2020
Servicing UPB	$	7,060,536,350	$	5,070,287,864

Assumptions Used in Determining MSR Value

The following key assumptions were used in determining MSR value.

Prepayment

Speeds

Average

Life(Years)

Discount

Rate

December 31, 2021

11.60

6.64

9.50

December 31, 2020

15.60

5.30

9.50

Schedule of Combined Maturities of Bank Loans Payable, Lines of Credit and Notes and Contracts Payable (Details)	Dec. 31, 2021 USD ($)
Lessee, Lease, Description [Line Items]
Bank loans payable, lines of credit and notes and contracts payable	$ 251,286,927
Due in year 1 [Member]
Lessee, Lease, Description [Line Items]
Bank loans payable, lines of credit and notes and contracts payable	164,747,672
Due in Year 2 [Member]
Lessee, Lease, Description [Line Items]
Bank loans payable, lines of credit and notes and contracts payable	1,745,541
Due in Year 3 [Member]
Lessee, Lease, Description [Line Items]
Bank loans payable, lines of credit and notes and contracts payable	36,333,278
Due in Year 4 [Member]
Lessee, Lease, Description [Line Items]
Bank loans payable, lines of credit and notes and contracts payable	2,512,683
Due in Year 5 [Member]
Lessee, Lease, Description [Line Items]
Bank loans payable, lines of credit and notes and contracts payable	735,981
DueThereafter [Member]
Lessee, Lease, Description [Line Items]
Bank loans payable, lines of credit and notes and contracts payable	$ 45,211,772

Receivables (Tables)

12 Months Ended

Dec. 31, 2021

Receivables [Abstract]

Schedule of Receivables

Receivables consist of the following:

Schedule of Receivables


	December 31
	2021			2020
Trade contracts	$	5,298,636		$	4,119,988
Receivables from sales agents		2,360,807			2,677,774
Other		12,457,398			5,786,827
Total receivables		20,116,841			12,584,589
Allowance for doubtful accounts		(1,800,725	)		(1,685,382	)
Net receivables	$	18,316,116		$	10,899,207

Summary of Operating Loss Carryforwards (Details)	Dec. 31, 2021 USD ($)
Operating Loss Carryforwards [Line Items]
Deferred Tax Assets, Operating Loss Carryforwards	$ 3,980,445
Year of Expiration 2022 [Member]
Operating Loss Carryforwards [Line Items]
Deferred Tax Assets, Operating Loss Carryforwards
Year of Expiration 2023 [Member]
Operating Loss Carryforwards [Line Items]
Deferred Tax Assets, Operating Loss Carryforwards
Year of Expiration 2024 [Member]
Operating Loss Carryforwards [Line Items]
Deferred Tax Assets, Operating Loss Carryforwards
Year of Expiration 2025 [Member]
Operating Loss Carryforwards [Line Items]
Deferred Tax Assets, Operating Loss Carryforwards
Year of Expiration 2026 [Member]
Operating Loss Carryforwards [Line Items]
Deferred Tax Assets, Operating Loss Carryforwards
Year of Expiration Thereafter up through 2037 [Member]
Operating Loss Carryforwards [Line Items]
Deferred Tax Assets, Operating Loss Carryforwards	1,237,784
Indefinite Carryforwards [Member]
Operating Loss Carryforwards [Line Items]
Deferred Tax Assets, Operating Loss Carryforwards	$ 2,742,661

Accumulated Other Comprehensive Income (Tables)

12 Months Ended

Dec. 31, 2021

Equity [Abstract]

Schedule of Changes in accumulated other comprehensive income

The following summarizes the changes in accumulated other comprehensive income:

	2021			2020
	December 31
	2021			2020

Unrealized gains on fixed maturity securities available for sale	$	(7,323,241	)	$	12,016,464
Amounts reclassified into net earnings		805,510			(2,772	)
Net unrealized gains before taxes		(6,517,731	)		12,013,692
Tax expense		1,368,721			(2,522,876	)
Net		(5,149,010	)		9,490,816
Unrealized gains on restricted assets (1)		(23,250	)		41,225
Tax expense		5,792			(10,269	)
Net		(17,458	)		30,956
Unrealized gains on cemetery perpetual care trust investments (1)		(11,114	)		(6,817	)
Tax expense		2,769			1,698
Net		(8,345	)		(5,119	)
Unrealized gains for foreign currency translations adjustments		2,835			(46	)
Tax expense		(707	)		12
Net		2,128			(34	)
Other comprehensive income changes	$	(5,172,685	)	$	9,516,619

(1)	Fixed maturity securities available for sale

Schedule of Accumulated Balances of Other Comprehensive Income

The following is the accumulated balances of other comprehensive income as of December 31, 2021:

	Beginning Balance December 31, 2020			Change for the period			Ending Balance December 31, 2021
Unrealized gains (losses) on fixed maturity securities available for sale	$	23,170,275		$	(5,149,010	)	$	18,021,265
Unrealized gains (losses) on restricted assets (1)		57,650			(17,458	)		40,192
Unrealized gains (losses) on cemetery perpetual care trust investments (1)		17,336			(8,345	)		8,991
Foreign currency translation adjustments		(2,128	)		2,128			-
Other comprehensive income	$	23,243,133		$	(5,172,685	)	$	18,070,448

(1) Fixed maturity securities available for sale

The following is the accumulated balances of other comprehensive income as of December 31, 2020:

	Beginning Balance December 31, 2019			Change for the period			Ending Balance December 31, 2020
Unrealized gains on fixed maturity securities available for sale	$	13,679,459		$	9,490,816		$	23,170,275
Unrealized gains on restricted assets (1)		26,694			30,956			57,650
Unrealized gains (losses) on cemetery perpetual care trust investments (1)		22,455			(5,119	)		17,336
Foreign currency translation adjustments		(2,094	)		(34	)		(2,128	)
Other comprehensive income	$	13,726,514		$	9,516,619		$	23,243,133

(1)	Fixed maturity securities available for sale

Schedule of The Components of The Cemetery Perpetual Care Obligation (Details) - USD ($)	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items]
Cash and cash equivalents	$ 141,414,282	$ 115,465,086	$ 137,735,673
Real estate held for investment	3,731,300	7,878,807
Total cemetery perpetual care trust investments	7,835,721	6,413,167
Total investments	823,555,327	773,945,298
Cemetery Perpectual Care Oblication [Member]
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items]
Cash and cash equivalents	1,059,519	402,913
Fixed maturity securities, available for sale, at estimated fair value	784,765	747,767
Equity securities, at estimated fair value	3,302,480	2,062,303
Participating interests in residential construction mortgage loans held for investment with Security National Life	1,823,533	1,468,600
Real estate held for investment	865,424	1,731,584
Total cemetery perpetual care trust investments	7,835,721	6,413,167
Cemetery perpetual care obligation	(4,915,285)	(4,087,704)
Total investments	$ 2,920,436	$ 2,325,463

Schedule of Accumulated Balances of Other Comprehensive Income (Details) - USD ($)

12 Months Ended

Dec. 31, 2021

Dec. 31, 2020

Equity [Abstract]

Unrealized gains on fix maturity securities available-for-sale

$ 23,170,275

$ 13,679,459

Increase (Decrease) in Unrealized gains on fixed maturity securities available-for-sale

(5,149,010)

9,490,816

Unrealized gains on fix maturity securities available-for-sale

18,021,265

23,170,275

Unrealized gains (losses) on restricted assets

57,650

^[1]

26,694

^[2]

Increase Dececrease in Unrealized gains (losses) on restricted assets

(17,458)

^[1]

30,956

^[2]

Unrealized gains (losses) on restricted assets

^[1]

40,192

57,650

Unrealized gains (losses) on cemetery perpetual care trust investments

17,336

^[1]

22,455

^[2]

Increase Dececrease in Unrealized gains (losses) on cemetery perpetual care trust investments

(8,345)

^[1]

(5,119)

^[2]

Unrealized gains (losses) on cemetery perpetual care trust investments

^[1]

8,991

17,336

Foreign currency translation adjustments

(2,128)

(2,094)

Increase Decrease Foreign currency translation adjustments

2,128

(34)

Foreign currency translation adjustments

(2,128)

Other comprehensive income (loss), Balance

23,243,133

13,726,514

Increase (Decrease) in Other comprehensive income (loss), Balance

(5,172,685)

9,516,619

Other comprehensive income (loss), Balance

$ 18,070,448

$ 23,243,133

[1]	Fixed maturity securities available for sale
[2]	Fixed maturity securities available for sale

Significant Accounting Policies (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Property, Plant and Equipment [Line Items]
Remaining outstanding principal balance percentage	0.25%
Participating business	2.00%	2.00%
Diversification of business	$ 100,000
Concentration risk percentage1	100.00%
Minimum [Member]
Property, Plant and Equipment [Line Items]
Estimated useful lives	3 years
Debt instrument interest rate effective percentage	4.00%
Participating policy percentage of premium income	3.00%
Maximum [Member]
Property, Plant and Equipment [Line Items]
Estimated useful lives	40 years
Debt instrument interest rate effective percentage	10.00%
Participating policy percentage of premium income	6.50%
MSRs Class One [Member]
Property, Plant and Equipment [Line Items]
Debt instrument term	30 years
MSRs Class Two [Member]
Property, Plant and Equipment [Line Items]
Debt instrument term	15 years

Cemetery Perpetual Care Trust Investments and Obligation and Restricted Assets

12 Months Ended

Dec. 31, 2021

Cemetery Perpetual Care Trust Investments And Obligation And Restricted Assets

Cemetery Perpetual Care Trust Investments and Obligation and Restricted Assets

8) Cemetery Perpetual Care Trust Investments and Obligation and Restricted Assets

State law requires the Company to pay into endowment care trusts a portion of the proceeds from the sale of certain cemetery property interment rights for cemeteries that have established an endowment care trust. These endowment care trusts are defined as variable interest entities pursuant to GAAP. Also, management has determined that the Company is the primary beneficiary of these trusts, as it absorbs both a majority of the losses and returns associated with the trusts. The Company has consolidated cemetery endowment care trust investments with a corresponding amount recorded as Cemetery Perpetual Care Obligation in the accompanying consolidated balance sheets.

The components of the cemetery perpetual care investments and obligation are as follows:

	2021			2020
	December 31
	2021			2020
Cash and cash equivalents	$	1,059,519		$	402,913
Fixed maturity securities, available for sale, at estimated fair value		784,765			747,767
Equity securities, at estimated fair value		3,302,480			2,062,303
Participating interests in residential construction mortgage loans held for investment with Security National Life		1,823,533			1,468,600
Real estate held for investment		865,424			1,731,584
Total cemetery perpetual care trust investments		7,835,721			6,413,167
Cemetery perpetual care obligation		(4,915,285	)		(4,087,704	)
Trust investments in excess of trust obligations	$	2,920,436		$	2,325,463

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

8) Cemetery Perpetual Care Trust Investments and Obligation and Restricted Assets (Continued)

The Company has also established certain restricted assets to provide for future merchandise and service obligations incurred in connection with its pre-need sales for its cemetery and mortuary segment.

Restricted cash also represents escrows held for borrowers and investors under servicing and appraisal agreements relating to mortgage loans, funds held by warehouse banks in accordance with loan purchase agreements and funds held in escrow for certain real estate construction development projects. Additionally, the Company elected to maintain its medical benefit fund without change from the prior year and has included this amount as a component of restricted cash. These restricted cash items are for the Company’s life insurance and mortgage segments.

Restricted assets are summarized as follows:

	2021		2020
	December 31
	2021		2020
Cash and cash equivalents (1)	$	9,000,293	$	8,842,744
Fixed maturity securities, available for sale, at estimated fair value		1,601,688		1,473,637
Equity securities, at estimated fair value		3,603,822		2,515,778
Participating interests in mortgage loans held for investment with Security National Life		2,732,319		3,317,877
Total	$	16,938,122	$	16,150,036

(1)	Including cash and cash equivalents of $7,869,295 and $852,499 as of December 31, 2021 and 2020, respectively, for the life insurance and mortgage segments.

A surplus note receivable in the amount of $4,000,000 at December 31, 2021 and 2020, from Security National Life, was eliminated in consolidation.

See Notes 1 and 17 for additional information regarding restricted assets.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

Stock Compensation Plans (Details Narrative) - USD ($)	12 Months Ended
Stock Compensation Plans (Details Narrative) - USD ($)	Dec. 31, 2021	Dec. 31, 2020
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares based compensation expenses	$ 118,384	$ 358,878
Total unrecognized compensation expense	875,735
Intrinsic value stock options exercised	1,153,417	663,901
Option Plans [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares based compensation expenses	$ 118,384	$ 358,878

Schedule of Mortgage loans Held for Investment (Details)	Dec. 31, 2021 USD ($)
Net Investment Income [Line Items]
Total	$ 280,334,517
Principal Amounts Due in 1 Year	170,169,796
Principal Amounts Due in 2-5 Year	61,200,063
Principal Amounts Due Thereafter	48,964,658
Residential Mortgage [Member]
Net Investment Income [Line Items]
Total	53,533,712
Principal Amounts Due in 1 Year	7,451,252
Principal Amounts Due in 2-5 Year	6,031,628
Principal Amounts Due Thereafter	40,050,832
Residential Construction [Member]
Net Investment Income [Line Items]
Total	175,117,783
Principal Amounts Due in 1 Year	145,711,262
Principal Amounts Due in 2-5 Year	29,406,521
Principal Amounts Due Thereafter
Commercial [Member]
Net Investment Income [Line Items]
Total	51,683,022
Principal Amounts Due in 1 Year	17,007,282
Principal Amounts Due in 2-5 Year	25,761,914
Principal Amounts Due Thereafter	$ 8,913,826

- Definition

Amount, after unamortized (discount) premium and debt issuance costs, of long-term debt. Includes, but not limited to, notes payable, bonds payable, debentures, mortgage loans and commercial paper. Excludes capital lease obligations.

+ References + Details

Consolidated Balance Sheets - USD ($)	Dec. 31, 2021	Dec. 31, 2020
Investments:
Fixed maturity securities, available for sale, at estimated fair value (amortized cost of $236,303,310 and $265,150,484 for 2021 and 2020)	$ 259,287,603	$ 294,656,679
Equity securities at estimated fair value (cost of $8,275,772 and $9,698,490 for 2021 and 2020)	11,596,414	11,324,239
Mortgage loans held for investment (net of allowances for loan losses of $1,699,902 and $2,005,127 for 2021 and 2020)	277,306,046	249,343,936
Real estate held for investment (net of accumulated depreciation of $17,692,038 and $13,800,973 for 2021 and 2020)	197,365,797	131,684,453
Real estate held for sale	3,731,300	7,878,807
Other investments and policy loans (net of allowances for doubtful accounts of $1,686,218 and $1,645,475 for 2021 and 2020)	67,955,155	73,696,661
Accrued investment income	6,313,012	5,360,523
Total investments	823,555,327	773,945,298
Cash and cash equivalents	131,354,470	106,219,429
Loans held for sale at estimated fair value	302,776,827	422,772,418
Receivables (net of allowances for doubtful accounts of $1,800,725 and $1,685,382 for 2021 and 2020)	18,316,116	10,899,207
Restricted assets (including $5,205,510 and $3,989,415 for 2021 and 2020 at estimated fair value)	16,938,122	16,150,036
Cemetery perpetual care trust investments (including $4,087,245 and $2,810,070 for 2021 and 2020 at estimated fair value)	7,835,721	6,413,167
Receivable from reinsurers	14,850,608	15,569,156
Cemetery land and improvements	8,977,877	8,761,436
Deferred policy and pre-need contract acquisition costs	105,049,983	100,075,276
Mortgage servicing rights, net	53,060,455	35,210,516
Property and equipment, net	21,517,598	12,473,345
Value of business acquired	8,421,432	8,955,249
Goodwill	5,253,783	3,519,588
Other	29,684,987	27,976,357
Total Assets	1,547,593,306	1,548,940,478
Liabilities
Future policy benefits and unpaid claims	863,274,693	844,790,087
Unearned premium reserve	3,060,738	3,328,623
Bank and other loans payable	251,286,927	297,824,368
Deferred pre-need cemetery and mortuary contract revenues	14,508,022	13,080,179
Cemetery perpetual care obligation	4,915,285	4,087,704
Accounts payable	10,166,573	8,932,683
Other liabilities and accrued expenses	69,578,138	87,650,981
Income taxes	31,036,096	25,258,800
Total liabilities	1,247,826,472	1,284,953,425
Stockholders’ Equity
Preferred stock - non-voting-$1.00 par value; 5,000,000 shares authorized; none issued or outstanding
Additional paid-in capital	57,985,947	50,287,253
Accumulated other comprehensive income, net of taxes	18,070,448	23,243,133
Retained earnings	184,537,489	153,739,167
Treasury stock, at cost - 108,079 Class A shares and 109,193 Class C shares in 2021; 227,852 Class A shares and 10,985 Class C shares in 2020	(1,845,624)	(1,833,272)
Total stockholders’ equity	299,766,834	263,987,053
Total Liabilities and Stockholders’ Equity	1,547,593,306	1,548,940,478
Common Class A [Member]
Stockholders’ Equity
Common stock, value	35,285,444	33,191,566
Common Class B [Member]
Stockholders’ Equity
Common stock, value
Common Class C [Member]
Stockholders’ Equity
Common stock, value	$ 5,733,130	$ 5,359,206

Fair Value of Financial Instruments

12 Months Ended

Dec. 31, 2021

Fair Value Disclosures [Abstract]

Fair Value of Financial Instruments

17) Fair Value of Financial Instruments

GAAP defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants. GAAP also specifies a fair value hierarchy based upon the observability of inputs used in valuation techniques. Observable inputs (highest level) reflect market data obtained from independent sources, while unobservable inputs (lowest level) reflect internally developed market assumptions. Fair value measurements are classified under the following hierarchy:

Level 1: Financial assets and financial liabilities whose values are based on unadjusted quoted prices for identical assets or liabilities in an active market that the Company can access.

Level 2: Financial assets and financial liabilities whose values are based on the following:

a) Quoted prices for similar assets or liabilities in active markets;

b) Quoted prices for identical or similar assets or liabilities in non-active markets; or

c) Valuation models whose inputs are observable, directly or indirectly, for substantially the full term of the asset or liability.

Level 3: Financial assets and financial liabilities whose values are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. These inputs may reflect the Company’s estimates of the assumptions that market participants would use in valuing the financial assets and financial liabilities.

The Company utilizes a combination of third-party valuation service providers, brokers, and internal valuation models to determine fair value.

The following methods and assumptions were used by the Company in estimating the fair value disclosures related to significant financial instruments:

The items shown under Level 1 and Level 2 are valued as follows:

Fixed Maturity Securities Available for Sale: The fair values of fixed maturity securities are based on quoted market prices, when available. For fixed maturity securities not actively traded, fair values are estimated using values obtained from independent pricing services, or in the case of private placements (considered Level 3 investments), are estimated by discounting expected future cash flows using a current market value applicable to the coupon rate, credit and maturity of the investments.

Equity Securities: The fair values for equity securities are based on quoted market prices.

Loans Held for Sale: The Company elected the fair value option for loans held for sale. The fair value is based on quoted market prices, when available. When a quoted market price is not readily available, the Company uses the market price from its last sale of similar assets.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

17) Fair Value of Financial Instruments (Continued)

Restricted Assets: A portion of these assets include mutual funds, equity securities and fixed maturity securities available for sale that have quoted market prices that are used to determine fair value. Also included are cash and cash equivalents and participations in mortgage loans. The carrying amounts reported in the accompanying consolidated balance sheets for these financial instruments approximate their fair values due to their short-term nature.

Cemetery Perpetual Care Trust Investments: A portion of these assets include equity securities and fixed maturity securities available for sale that have quoted market prices that are used to determine fair value. Also included are cash and cash equivalents. The carrying amounts reported in the accompanying consolidated balance sheets for these financial instruments approximate their fair values due to their short-term nature

Call and Put Options: The Company uses quoted market prices to value its call and put options.

Additionally, there were no transfers between Level 1 and Level 2 in the fair value hierarchy.

The items shown under Level 3 are valued as follows:

Loan Commitments and Forward Sale Commitments: The Company’s mortgage segment enters into loan commitments with potential borrowers and forward sale commitments to sell loans to third-party investors. The Company also uses a hedging strategy for these transactions. A loan commitment binds the Company to lend funds to a qualified borrower at a specified interest rate and within a specified period of time, generally up to 30 days after issuance of the loan commitment. Loan commitments are defined to be derivatives under GAAP and are recognized at fair value on the consolidated balance sheets with changes in their fair values recorded in current earnings.

The Company estimates the fair value of a loan commitment based on the change in estimated fair value of the underlying mortgage loan, quoted MBS prices, estimates of the fair value of mortgage servicing rights, and an estimate of the probability that the mortgage loan will fund within the terms of the commitment. The change in fair value of the underlying mortgage loan is measured from the date the loan commitment is issued. Following issuance, the value of a mortgage loan commitment can be either positive or negative depending upon the change in value of the underlying mortgage loans. Fallout rates and other factors from the Company’s recent historical data are used to estimate the quantity and value of mortgage loans that will fund within the terms of the commitments.

Impaired Mortgage Loans Held for Investment: The Company believes that the fair value of these nonperforming loans will approximate the unpaid principal balance expected to be recovered based on the fair value of the underlying collateral. For residential and commercial properties, the collateral value is estimated by obtaining an independent appraisal. The appraisal typically considers area comparables and property condition as well as potential rental income that could be generated (particularly for commercial properties). For residential construction loans, the collateral is typically incomplete, so fair value is estimated as the replacement cost using data from a provider of building cost information to the real estate construction.

Impaired Real Estate Held for Investment: The Company believes that in an orderly market, fair value will approximate the replacement cost of a home and the rental income provides a cash flow stream for investment analysis. The Company believes the highest and best use of the properties are as income producing assets since it is the Company’s intent to hold the properties as rental properties, matching the income from the investment in rental properties with the funds required for future estimated policy claims.

It should be noted that for replacement cost, when determining the fair value of real estate held for investment, the Company uses a provider of building cost information to the real estate construction industry. For the investment analysis, the Company used market data based upon its real estate operation experience and projected the present value of the net rental income over seven years. The Company also considers area comparable properties and property condition when determining fair value.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

17) Fair Value of Financial Instruments (Continued)

In addition to this analysis performed by the Company, the Company depreciates Real Estate Held for Investment. This depreciation reduces the book value of these properties and lessens the exposure to the Company from further deterioration in real estate values.

Mortgage Servicing Rights: The Company initially recognizes MSRs at their estimated fair values derived from the net cash flows associated with the servicing contracts, where the Company assumes the obligation to service the loan in the sale transaction.

The following table summarizes Level 1, 2 and 3 financial assets and financial liabilities measured at fair value on a recurring basis by their classification in the consolidated balance sheet at December 31, 2021.

	Total			Quoted Prices in Active Markets for Identical Assets (Level 1)			Significant Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets accounted for at fair value on a recurring basis
Fixed maturity securities available for sale	$	259,287,603		$	-		$	257,264,255	$	2,023,348
Equity securities		11,596,414			11,596,414			-		-
Loans held for sale		302,776,827			-			-		302,776,827
Restricted assets (1)		1,601,688			-			1,601,688		-
Restricted assets (2)		3,603,822			3,603,822			-		-
Cemetery perpetual care trust investments (1)		784,765			-			784,765		-
Cemetery perpetual care trust investments (2)		3,302,480			3,302,480			-		-
Derivatives - loan commitments (3)		8,563,410			-			-		8,563,410
Total assets accounted for at fair value on a recurring basis	$	591,517,009		$	18,502,716		$	259,650,708	$	313,363,585

Liabilities accounted for at fair value on a recurring basis
Derivatives - call options (4)	$	(50,936	)	$	(50,936	)	$	-	$	-
Derivatives - put options (4)		(4,493	)		(4,493	)		-		-
Derivatives - loan commitments (4)		(1,547,895	)		-			-		(1,547,895	)
Total liabilities accounted for at fair value on a recurring basis	$	(1,603,324	)	$	(55,429	)	$	-	$	(1,547,895	)

(1)	Fixed maturity securities available for sale

(2)	Equity securities

(3)	Included in other assets on the consolidated balance sheets

(4)	Included in other liabilities and accrued expenses on the consolidated balance sheets

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

17) Fair Value of Financial Instruments (Continued)

	Total			Quoted Prices in Active Markets for Identical Assets (Level 1)			Significant Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets accounted for at fair value on a recurring basis
Fixed maturity securities available for sale	$	294,656,679		$	-		$	292,455,504	$	2,201,175
Equity securities		11,324,239			11,324,239			-		-
Loans held for sale		422,772,418			-			-		422,772,418
Restricted assets (1)		1,473,637			-			1,473,637		-
Restricted assets (2)		2,515,778			2,515,778			-		-
Cemetery perpetual care trust investments (1)		747,767			-			747,767		-
Cemetery perpetual care trust investments (2)		2,062,303			2,062,303			-		-
Derivatives - loan commitments (3)		12,592,672			-			-		12,592,672
Total assets accounted for at fair value on a recurring basis	$	748,145,493		$	15,902,320		$	294,676,908	$	437,566,265

Liabilities accounted for at fair value on a recurring basis
Derivatives - call options (4)	$	(43,097	)	$	(43,097	)	$	-	$	-
Derivatives - loan commitments (4)		(2,464,062	)		-			-		(2,464,062	)
Total liabilities accounted for at fair value on a recurring basis	$	(2,507,159	)	$	(43,097	)	$	-	$	(2,464,062	)

(1) Fixed maturity securities available for sale

(2) Equity securities

(3) Included in other assets on the consolidated balance sheets

(4) Included in other liabilities and accrued expenses on the consolidated balance sheets

For Level 3 assets and liabilities measured at fair value on a recurring basis as of December 31, 2021, the significant unobservable inputs used in the fair value measurements were as follows:

				Significant	Range of Inputs
	Fair Value at		Valuation	Unobservable	Minimum			Maximum			Weighted
	12/31/2021		Technique	Input(s)	Value			Value			Average
Loans held for sale	$	302,776,827	Market approach	Investor contract pricing as a percentage of unpaid principal balance		95.0	%		109.0	%		103.0	%

Derivatives - loan commitments (net)		7,015,515	Market approach	Pull-through rate		66.0	%		95.0	%		81.0	%
				Initial-Value		N/A			N/A			N/A
				Servicing		0 bps			148 bps			61 bps

Fixed maturity securities available for sale		2,023,348	Broker quotes	Pricing quotes	$	96.87		$	111.11		$	106.73

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

17) Fair Value of Financial Instruments (Continued)

For Level 3 assets and liabilities measured at fair value on a recurring basis as of December 31, 2020, the significant unobservable inputs used in the fair value measurements were as follows:

				Significant	Range of Inputs
	Fair Value at		Valuation	Unobservable	Minimum			Maximum			Weighted
	12/31/2020		Technique	Input(s)	Value			Value			Average
Loans held for sale	$	422,772,418	Market approach	Investor contract pricing as a percentage of unpaid principal balance		99.0	%		110.0	%		104.0	%

Derivatives - loan commitments (net)		10,128,610	Market approach	Pull-through rate		52.0	%		92.0	%		81.0	%
				Initial-Value		N/A			N/A			N/A
				Servicing		0 bps			184 bps			58 bps

Fixed maturity securities available for sale		2,201,175	Broker quotes	Pricing quotes	$	90.83		$	119.33		$	113.47

Following is a summary of changes in the consolidated balance sheet line items measured using level 3 inputs:

	Net Derivatives Loan Commitments			Loans Held for Sale			Fixed Maturity Securities Available for Sale

Balance - December 31, 2020	$	10,128,610		$	422,772,418		$	2,201,175
Originations/purchases		-			5,611,189,587			-
Sales, maturities and paydowns		-			(5,900,076,766	)		(45,700	)
Transfer to mortgage loans held for investment		-			(201,951	)		-
Total gains (losses):
Included in earnings		(3,113,095	)(1)		169,093,539	(1)		3,674	(2)
Included in other comprehensive income		-			-			(135,801	)

Balance - December 31, 2021	$	7,015,515		$	302,776,827		$	2,023,348

(1)	As a component of mortgage fee income on the consolidated statements of earnings

(2)	As a component of net investment income on the consolidated statements of earnings

Following is a summary of changes in the consolidated balance sheet line items measured using level 3 inputs:

	Net Derivatives Loan Commitments			Loans Held for Sale			Fixed Maturity Securities Available for Sale

Balance - December 31, 2019	$	2,491,233		$	213,457,632		$	3,216,382
Originations/purchases		-			5,627,013,749			-
Sales, maturities and paydowns		-			(5,600,045,285	)		(1,042,400	)
Transfer to mortgage loans held for investment		-			(16,960,549	)		-
Total gains (losses):
Included in earnings		7,637,377	(1)		199,306,871	(1)		3,408	(2)
Included in other comprehensive income		-			-			23,785

Balance - December 31, 2020	$	10,128,610		$	422,772,418		$	2,201,175

(1)	As a component of mortgage fee income on the consolidated statements of earnings

(2)	As a component of net investment income on the consolidated statements of earnings

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

17) Fair Value of Financial Instruments (Continued)

The following tables summarize Level 1, 2 and 3 financial assets and financial liabilities measured at fair value on a nonrecurring basis by their classification in the consolidated balance sheet at December 31, 2021.

	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets accounted for at fair value on a nonrecurring basis
Impaired mortgage loans held for investment	$	851,903	$	-	$	-	$	851,903
Impaired real estate held for sale		2,000,000		-		-		2,000,000
Total assets accounted for at fair value on a nonrecurring basis	$	2,851,903	$	-	$	-	$	2,851,903

	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets accounted for at fair value on a nonrecurring basis
Impaired mortgage loans held for investment	$	1,297,356	$	-	$	-	$	1,297,356
Impaired real estate held for sale		4,249,000		-		-		4,249,000
Total assets accounted for at fair value on a nonrecurring basis	$	5,546,356	$	-	$	-	$	5,546,356

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

17) Fair Value of Financial Instruments (Continued)

Fair Value of Financial Instruments Carried at Other Than Fair Value

ASC 825, Financial Instruments, requires disclosure of fair value information about financial instruments, whether or not recognized in the balance sheet, for which it is practicable to estimate that value.

Management uses its best judgment in estimating the fair value of the Company’s financial instruments; however, there are inherent limitations in any estimation technique. Therefore, for substantially all financial instruments, the fair value estimates presented herein are not necessarily indicative of the amounts the Company could have realized in a sales transaction at December 31, 2021 and 2020.

The carrying values and estimated fair values for such financial instruments, and their corresponding placement in the fair value hierarchy, are summarized as follows as of December 31, 2021:

	Carrying Value			Level 1		Level 2		Level 3			Total Estimated Fair Value
Assets
Mortgage loans held for investment
Residential	$	51,396,172		$	-	$	-	$	55,159,167		$	55,159,167
Residential construction		174,691,408			-		-		174,691,408			174,691,408
Commercial		51,218,466			-		-		51,008,709			51,008,709
Mortgage loans held for investment, net	$	277,306,046		$	-	$	-	$	280,859,284		$	280,859,284
Policy loans		13,478,214			-		-		13,478,214			13,478,214
Insurance assignments, net (1)		46,946,590			-		-		46,946,590			46,946,590
Restricted assets (2)		2,732,320			-		-		2,732,320			2,732,320
Cemetery perpetual care trust investments (2)		1,823,533			-		-		1,823,533			1,823,533
Mortgage servicing rights, net		53,060,455			-		-		68,811,809			68,811,809

Liabilities
Bank and other loans payable	$	(251,286,927	)	$	-	$	-	$	(251,286,927	)	$	(251,286,927	)
Policyholder account balances (3)		(42,939,055	)		-		-		(35,855,934	)		(35,855,934	)
Future policy benefits - annuities (3)		(107,992,830	)		-		-		(116,215,717	)		(116,215,717	)

(1)	Included in other investments and policy loans on the consolidated balance sheets

(2)	Mortgage loans held for investment

(3)	Included in future policy benefits and unpaid claims on the consolidated balance sheets

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

17) Fair Value of Financial Instruments (Continued)

The carrying values and estimated fair values for such financial instruments, and their corresponding placement in the fair value hierarchy, are summarized as follows as of December 31, 2020:

	Carrying Value			Level 1		Level 2		Level 3			Total Estimated Fair Value
Assets
Mortgage loans held for investment
Residential	$	92,757,613		$	-	$	-	$	100,384,283		$	100,384,283
Residential construction		110,849,864			-		-		110,849,864			110,849,864
Commercial		45,736,459			-		-		45,259,425			45,259,425
Mortgage loans held for investment, net	$	249,343,936		$	-	$	-	$	256,493,572		$	256,493,572
Policy loans		14,171,589			-		-		14,171,589			14,171,589
Insurance assignments, net (1)		51,585,656			-		-		51,585,656			51,585,656
Restricted assets (2)		3,317,877			-		-		3,317,877			3,317,877
Cemetery perpetual care trust investments (2)		1,468,600			-		-		1,468,600			1,468,600
Mortgage servicing rights, net		35,210,516			-		-		38,702,358			38,702,358

Liabilities
Bank and other loans payable	$	(297,824,368	)	$	-	$	-	$	(297,824,368	)	$	(297,824,368	)
Policyholder account balances (3)		(44,026,809	)		-		-		(42,220,725	)		(42,220,725	)
Future policy benefits - annuities (3)		(106,522,113	)		-		-		(112,354,186	)		(112,354,186	)

(1)	Included in other investments and policy loans on the consolidated balance sheets

(2)	Mortgage loans held for investment

(3)	Included in future policy benefits and unpaid claims on the consolidated balance sheets

The methods, assumptions and significant valuation techniques and inputs used to estimate the fair value of financial instruments are summarized as follows:

Mortgage Loans Held for Investment: The estimated fair value of the Company’s mortgage loans held for investment is determined using various methods. The Company’s mortgage loans are grouped into three categories: Residential, Residential Construction and Commercial. When estimating the expected future cash flows, it is assumed that all loans will be held to maturity, and any loans that are non-performing are evaluated individually for impairment.

Residential — The estimated fair value of mortgage loans is determined through a combination of discounted cash flows (estimating expected future cash flows of payments and discounting them using current interest rates from single family mortgages) and considering pricing of similar loans that were sold recently.

Residential Construction — These loans are primarily short in maturity. Accordingly, the estimated fair value is determined to be the carrying value.

Commercial — The estimated fair value is determined by estimating expected future cash flows of payments and discounting them using current interest rates for commercial mortgages.

Policy Loans: The carrying amounts reported in the accompanying consolidated balance sheet for these financial instruments approximate their fair values because they are fully collateralized by the cash surrender value of the underlying insurance policies.

Insurance Assignments, Net: These investments are short in maturity. Accordingly, the carrying amounts reported in the accompanying consolidated balance sheet for these financial instruments approximate their fair values.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

17) Fair Value of Financial Instruments (Continued)

Bank and Other Loans Payable: The carrying amounts reported in the accompanying consolidated balance sheet for these financial instruments approximate their fair values due to their relatively short-term maturities and variable interest rates.

Policyholder Account Balances and Future Policy Benefits-Annuities: Future policy benefit reserves for interest-sensitive insurance products are computed under a retrospective deposit method and represent policy account balances before applicable surrender charges. Policy benefits and claims that are charged to expense include benefit claims incurred in the period in excess of related policy account balances. Interest crediting rates for interest-sensitive insurance products ranged from 1.5% to 6.5%. The fair values for these investment-type insurance contracts are estimated based on the present value of liability cash flows. The fair values for the Company’s insurance contracts other than investment-type contracts are not required to be disclosed. However, the fair values of liabilities under all insurance contracts are taken into consideration in the Company’s overall management of interest rate risk, such that the Company’s exposure to changing interest rates is minimized through the matching of investment maturities with amounts due under insurance contracts.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Future Policy Benefits and Unpaid Claims

12 Months Ended

Dec. 31, 2021

Insurance [Abstract]

Future Policy Benefits and Unpaid Claims

22) Future Policy Benefits and Unpaid Claims

The Company reports future policy benefits and unpaid claims pursuant to the accounting policy discussed in Note 1 of the Notes to Consolidated Financial Statements.

The following table provides information regarding future policy benefits and unpaid claims and the related receivable from reinsurers.

	December 31
	2021		2020
Life	$	698,366,477	$	674,230,463
Annuities		107,992,830		109,522,112
Policyholder account balances		42,939,055		44,026,809
Accident and health		629,302		651,140
Other policyholder funds		4,352,217		4,354,746
Reported but unpaid claims		4,887,934		8,689,723
Incurred but not reported claims		4,106,878		3,315,094

Gross future policy benefits and unpaid claims	$	863,274,693	$	844,790,087

Receivable from reinsurers

Life		10,482,428		10,841,567
Annuities		4,082,877		4,047,301
Accident and health		88,474		90,231
Reported but unpaid claims		177,829		571,057
Incurred but not reported claims		19,000		19,000

Total receivable from reinsurers		14,850,608		15,569,156

Net future policy benefits and unpaid claims	$	848,424,085	$	829,220,931

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

Consolidated Balance Sheets (Parenthetical) - USD ($)	Dec. 31, 2021	Dec. 31, 2020
Amortized cost	$ 236,303,310	$ 265,150,484
Equity securities cost	8,275,772	9,698,490
Allowance for loan and lease losses, real estate	1,699,902	2,005,127
Real estate investment property, accumulated depreciation	17,692,038	13,800,973
Allowance for doubtful accounts, premiums and other receivables	1,686,218	1,645,475
Accounts receivable, allowance for credit loss	1,800,725	1,685,382
Aggregate fair value, restricted assets	5,205,510	3,989,415
Aggregate fair value, Cemetery perpetual care trust investments	$ 4,087,245	$ 2,810,070
Preferred stock, par value	$ 1.00	$ 1.00
Preferred stock, shares authorized	5,000,000	5,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common Class A [Member]
Common stock, par value	$ 2.00	$ 2.00
Common stock, shares authorized	20,000,000	20,000,000
Common stock, shares outstanding	17,642,722	16,595,783
Treasury stock, shares	108,079	227,852
Common Class B [Member]
Common stock, par value	$ 1.00	$ 1.00
Common stock, shares authorized	5,000,000	5,000,000
Common stock, shares outstanding	0	0
Common stock, shares outstanding	0	0
Common Class C [Member]
Common stock, par value	$ 2.00	$ 2.00
Common stock, shares authorized	3,000,000	3,000,000
Common stock, shares outstanding	2,866,565	2,679,603
Treasury stock, shares	109,193	10,985

Future Policy Benefits and Unpaid Claims (Tables)

12 Months Ended

Dec. 31, 2021

Insurance [Abstract]

Schedule of Liability for Future Policy Benefits, by Product Segment

	December 31
	2021		2020
Life	$	698,366,477	$	674,230,463
Annuities		107,992,830		109,522,112
Policyholder account balances		42,939,055		44,026,809
Accident and health		629,302		651,140
Other policyholder funds		4,352,217		4,354,746
Reported but unpaid claims		4,887,934		8,689,723
Incurred but not reported claims		4,106,878		3,315,094

Gross future policy benefits and unpaid claims	$	863,274,693	$	844,790,087

Receivable from reinsurers

Life		10,482,428		10,841,567
Annuities		4,082,877		4,047,301
Accident and health		88,474		90,231
Reported but unpaid claims		177,829		571,057
Incurred but not reported claims		19,000		19,000

Total receivable from reinsurers		14,850,608		15,569,156

Net future policy benefits and unpaid claims	$	848,424,085	$	829,220,931

Schedule of Earnings Per Share, Basic and Diluted (Details) - USD ($)

12 Months Ended

Dec. 31, 2021

Dec. 31, 2020

Numerator:

Net earnings

$ 39,518,990

$ 55,596,613

Denominator:

Denominator for basic earnings per share-weighted-average shares

^[1]

20,154,878

19,788,984

Employee stock options

774,206

465,423

Dilutive potential common shares

774,206

465,423

shares and assumed conversions

20,929,084

20,254,407

Basic earnings per share

^[1]

$ 1.96

$ 2.81

Diluted earnings per share

^[1]

$ 1.89

$ 2.74

[1]

Earnings per share amounts have been adjusted retroactively for the effect of annual stock dividends. The weighted-average shares outstanding includes the weighted-average Class A common shares and the weighted-average Class C common shares determined on an equivalent Class A common stock basis. Net earnings per common share represent net earnings per equivalent Class A common share.

- Definition

The amount of net income (loss) for the period per each share of common stock or unit outstanding during the reporting period.

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The amount of net income (loss) for the period available to each share of common stock or common unit outstanding during the reporting period and to each share or unit that would have been outstanding assuming the issuance of common shares or units for all dilutive potential common shares or units outstanding during the reporting period.

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+ Details

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

+ Details

Schedule of Value of Business Acquired (Details) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Goodwill and Intangible Assets Disclosure [Abstract]
Balance at beginning of year	$ 8,955,249	$ 9,876,647
Value of business acquired	586,840
Imputed interest at 7% included in earnings	613,028	670,565
Amortization included in earnings	(1,728,157)	(1,457,390)
Shadow amortization included in other comprehensive income	(5,528)	(134,573)
Net amortization	(1,120,657)	(921,398)
Balance at end of year	$ 8,421,432	$ 8,955,249

Schedule of Aggregate Fair Value - Loans Held for Sale (Details) - USD ($)	Dec. 31, 2021	Dec. 31, 2020
Loans Held For Sale
Aggregate fair value	$ 302,776,827	$ 422,772,418
Unpaid principal balance	294,481,503	406,407,323
Unrealized gain	$ 8,295,324	$ 16,365,095

Reinsurance, Commitments and Contingencies (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Loss Contingencies [Line Items]
Reinsurance payable	$ 100,000	$ 25,000
Assumed insurance	129,000,000	96,000,000
Other liabilities and accrued expenses	2,447,000	$ 20,584,000
Other commitments	329,903,000
Payment for other liabilities	$ 179,674,000
Loan Interest rate	7.00%
Minimum [Member]
Loss Contingencies [Line Items]
Loan Interest rate	2.00%
Maximum [Member]
Loss Contingencies [Line Items]
Loan Interest rate	10.50%
Loans [Member] \| Minimum [Member]
Loss Contingencies [Line Items]
Loan commitment ranges	50.00%
Loan Interest rate	5.50%
Loans [Member] \| Maximum [Member]
Loss Contingencies [Line Items]
Loan commitment ranges	80.00%
Loan Interest rate	8.00%

Schedule of Earnings on Fixed Maturity Securities (Details) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Investments, Debt and Equity Securities [Abstract]
Balance of credit-related OTTI at January 1	$ 370,975
Securities not previously impaired	39,502	370,975
Securities previously impaired
Securities that matured or were sold during the period (realized)	(145,500)
Securities due to an increase in expected cash flows
Balance of credit-related OTTI at December 31	$ 264,977	$ 370,975

Schedule of Major Categories of Net Investment Income (Details) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Marketable Securities [Line Items]
Proceeds from sales	$ 2,896,351	$ 5,477,438
Gross realized gains	208,698	358,236
Gross realized losses	(4,046)	(21,137)
Gross investment income	72,679,476	69,909,367
Investment expenses	(14,414,793)	(13,579,564)
Net investment income	58,264,683	56,329,803
Fixed Maturity Securities [Member]
Marketable Securities [Line Items]
Gross investment income	10,769,979	12,233,394
Equity Securities 1 [Member]
Marketable Securities [Line Items]
Gross investment income	446,337	642,433
Mortgage Loans Real Estate [Member]
Marketable Securities [Line Items]
Gross investment income	28,758,614	25,672,746
Real Estate 1 [Member]
Marketable Securities [Line Items]
Gross investment income	12,334,989	11,945,401
Policy Student And Other Loans [Member]
Marketable Securities [Line Items]
Gross investment income	940,890	1,025,179
Insurance Assignments [Member]
Marketable Securities [Line Items]
Gross investment income	19,062,052	17,837,578
Other Investments 1 [Member]
Marketable Securities [Line Items]
Gross investment income	131,145	126,013
Cash And Cash Equivalents 1 [Member]
Marketable Securities [Line Items]
Gross investment income	$ 235,470	$ 426,623

Consolidated Statements of Earnings - USD ($)

12 Months Ended

Dec. 31, 2021

Dec. 31, 2020

Revenues:

Mortgage fee income

$ 263,418,230

$ 298,933,110

Insurance premiums and other considerations

100,254,573

93,020,617

Net investment income

58,264,683

56,329,803

Net mortuary and cemetery sales

23,997,313

20,307,435

Gains on investments and other assets

6,265,134

1,925,850

Other than temporary impairments on investments

(39,502)

(370,975)

Other

18,535,111

11,317,482

Total revenues

470,695,542

481,463,322

Benefits and expenses:

Death benefits

63,247,616

59,040,130

Surrenders and other policy benefits

3,970,839

3,801,230

Increase in future policy benefits

26,263,312

23,568,650

Amortization of deferred policy and pre-need acquisition costs and value of business acquired

16,142,970

14,307,425

Selling, general and administrative expenses:

Commissions

118,286,469

124,426,297

Personnel

100,740,161

84,989,971

Advertising

6,626,418

5,380,896

Rent and rent related

7,242,287

6,873,561

Depreciation on property and equipment

1,935,613

2,078,738

Provision for loan loss reserve

16,506,030

Costs related to funding mortgage loans

10,541,570

9,877,700

Other

53,065,982

47,331,102

Interest expense

7,127,516

8,578,810

Cost of goods and services sold – cemeteries and mortuaries

3,704,014

3,252,655

Total benefits and expenses

418,894,767

410,013,195

Earnings before income taxes

51,800,775

71,450,127

Income tax expense

(12,281,785)

(15,853,514)

Net earnings

$ 39,518,990

$ 55,596,613

Net earnings per Class A equivalent common share

^[1]

$ 1.96

$ 2.81

Net earnings per Class A equivalent common share - assuming dilution

^[1]

$ 1.89

$ 2.74

Weighted average Class A equivalent common shares outstanding

^[1]

20,154,878

19,788,984

Weighted average Class A equivalent common shares outstanding-assuming dilution

^[1]

20,929,084

20,254,407

[1]

Schedule of Aging of Mortgage Loans (Details) - USD ($)

12 Months Ended

Dec. 31, 2021

Dec. 31, 2020

Marketable Securities [Line Items]

Financing Receivable, Allowance for Credit Loss, Beginning

$ 2,005,127

$ 1,453,037

Allowance for credit losses, Charge-offs

Allowance for Credit Losses, Provision

(305,225)

552,090

Financing Receivable, Allowance for Credit Loss, Ending Balance

1,699,902

2,005,127

Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment

105,384

219,905

Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment

1,594,518

1,785,222

Mortgage loans

280,334,517

253,771,091

Financing Receivable, Individually Evaluated for Impairment

4,272,028

10,282,470

Financing Receivable, Collectively Evaluated for Impairment

2,760,162,489

243,488,621

Mortgage Loans during period

280,334,517

253,771,091

Mortgage Loans, Allowance for Loan Losses

(1,699,902)

(2,005,127)

Mortgage Loans, Unamortized deferred loan fees, net

(918,586)

(1,161,132)

Mortgage Loans, Unamortized discounts, net

(409,983)

(1,260,896)

Past Due 30 to 59 Days [Member]

Marketable Securities [Line Items]

Mortgage Loans during period

4,480,953

6,226,896

Past Due 60 to 89 Days [Member]

Marketable Securities [Line Items]

Mortgage Loans during period

681,019

2,860,928

Past Due 90 or More Days [Member]

Marketable Securities [Line Items]

Mortgage Loans during period

^[1]

3,775,434

7,818,410

In Foreclosure [Member]

Marketable Securities [Line Items]

Mortgage Loans during period

^[1]

496,594

2,464,060

Total Past Due [Member]

Marketable Securities [Line Items]

Mortgage Loans during period

9,434,000

19,370,294

Current [Member]

Marketable Securities [Line Items]

Mortgage Loans during period

270,900,517

234,400,797

Net Mortgage Loans [Member]

Marketable Securities [Line Items]

Mortgage Loans during period

277,306,046

249,343,936

Commercial Loan [Member]

Marketable Securities [Line Items]

Financing Receivable, Allowance for Credit Loss, Beginning

187,129

Allowance for credit losses, Charge-offs

Allowance for Credit Losses, Provision

Financing Receivable, Allowance for Credit Loss, Ending Balance

187,129

Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment

Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment

187,129

Mortgage loans

51,683,022

46,836,866

Financing Receivable, Individually Evaluated for Impairment

1,723,372

2,148,827

Financing Receivable, Collectively Evaluated for Impairment

49,959,650

44,688,039

Mortgage Loans during period

51,683,022

46,836,866

Mortgage Loans, Allowance for Loan Losses

(187,129)

Mortgage Loans, Unamortized deferred loan fees, net

(36,813)

(32,557)

Mortgage Loans, Unamortized discounts, net

(240,614)

(880,721)

Commercial Loan [Member] | Past Due 30 to 59 Days [Member]

Marketable Securities [Line Items]

Mortgage Loans during period

233,200

Commercial Loan [Member] | Past Due 60 to 89 Days [Member]

Marketable Securities [Line Items]

Mortgage Loans during period

100,204

812,780

Commercial Loan [Member] | Past Due 90 or More Days [Member]

Marketable Securities [Line Items]

Mortgage Loans during period

^[1]

1,723,372

2,148,827

Commercial Loan [Member] | In Foreclosure [Member]

Marketable Securities [Line Items]

Mortgage Loans during period

^[1]

Commercial Loan [Member] | Total Past Due [Member]

Marketable Securities [Line Items]

Mortgage Loans during period

1,823,576

3,194,807

Commercial Loan [Member] | Current [Member]

Marketable Securities [Line Items]

Mortgage Loans during period

49,859,446

43,642,059

Commercial Loan [Member] | Net Mortgage Loans [Member]

Marketable Securities [Line Items]

Mortgage Loans during period

51,218,466

45,736,459

Residential Mortgage [Member]

Marketable Securities [Line Items]

Financing Receivable, Allowance for Credit Loss, Beginning

1,774,796

1,222,706

Allowance for credit losses, Charge-offs

Allowance for Credit Losses, Provision

(305,225)

552,090

Financing Receivable, Allowance for Credit Loss, Ending Balance

1,469,571

1,774,796

Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment

105,384

219,905

Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment

1,364,187

1,554,891

Mortgage loans

53,533,712

111,111,777

Financing Receivable, Individually Evaluated for Impairment

2,548,656

7,932,680

Financing Receivable, Collectively Evaluated for Impairment

50,985,056

103,179,097

Mortgage Loans during period

53,533,712

95,822,448

Mortgage Loans, Allowance for Loan Losses

(1,469,571)

(1,774,796)

Mortgage Loans, Unamortized deferred loan fees, net

(498,600)

(909,864)

Mortgage Loans, Unamortized discounts, net

(169,369)

(380,175)

Residential Mortgage [Member] | Past Due 30 to 59 Days [Member]

Marketable Securities [Line Items]

Mortgage Loans during period

3,117,826

5,866,505

Residential Mortgage [Member] | Past Due 60 to 89 Days [Member]

Marketable Securities [Line Items]

Mortgage Loans during period

580,815

2,048,148

Residential Mortgage [Member] | Past Due 90 or More Days [Member]

Marketable Securities [Line Items]

Mortgage Loans during period

^[1]

2,052,062

5,669,583

Residential Mortgage [Member] | In Foreclosure [Member]

Marketable Securities [Line Items]

Mortgage Loans during period

^[1]

496,594

2,263,097

Residential Mortgage [Member] | Total Past Due [Member]

Marketable Securities [Line Items]

Mortgage Loans during period

6,247,297

15,847,333

Residential Mortgage [Member] | Current [Member]

Marketable Securities [Line Items]

Mortgage Loans during period

47,286,415

79,975,115

Residential Mortgage [Member] | Net Mortgage Loans [Member]

Marketable Securities [Line Items]

Mortgage Loans during period

51,396,172

92,757,613

Residential Construction [Member]

Marketable Securities [Line Items]

Financing Receivable, Allowance for Credit Loss, Beginning

43,202

Allowance for credit losses, Charge-offs

Allowance for Credit Losses, Provision

Financing Receivable, Allowance for Credit Loss, Ending Balance

43,202

Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment

Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment

43,202

Mortgage loans

175,117,783

95,822,448

Financing Receivable, Individually Evaluated for Impairment

200,963

Financing Receivable, Collectively Evaluated for Impairment

175,117,783

95,621,485

Mortgage Loans during period

175,117,783

111,111,777

Mortgage Loans, Allowance for Loan Losses

(43,202)

Mortgage Loans, Unamortized deferred loan fees, net

(383,173)

(218,711)

Mortgage Loans, Unamortized discounts, net

Residential Construction [Member] | Past Due 30 to 59 Days [Member]

Marketable Securities [Line Items]

Mortgage Loans during period

1,363,127

127,191

Residential Construction [Member] | Past Due 60 to 89 Days [Member]

Marketable Securities [Line Items]

Mortgage Loans during period

Residential Construction [Member] | Past Due 90 or More Days [Member]

Marketable Securities [Line Items]

Mortgage Loans during period

^[1]

Residential Construction [Member] | In Foreclosure [Member]

Marketable Securities [Line Items]

Mortgage Loans during period

^[1]

200,963

Residential Construction [Member] | Total Past Due [Member]

Marketable Securities [Line Items]

Mortgage Loans during period

1,363,127

328,154

Residential Construction [Member] | Current [Member]

Marketable Securities [Line Items]

Mortgage Loans during period

173,754,656

110,783,623

Residential Construction [Member] | Net Mortgage Loans [Member]

Marketable Securities [Line Items]

Mortgage Loans during period

$ 174,691,408

$ 110,849,864

[1]	Interest income is not recognized on loans past due greater than 90 days or in foreclosure.

Statutory Financial Information and Dividend Limitations

12 Months Ended

Dec. 31, 2021

Insurance [Abstract]

Statutory Financial Information and Dividend Limitations

14) Statutory Financial Information and Dividend Limitations

The Company’s insurance subsidiaries prepare their statutory-basis financial statements in conformity with accounting practices prescribed or permitted by the insurance department of the applicable state of domicile. Prescribed statutory accounting practices include a variety of publications of the NAIC, as well as state laws, regulations and general administrative rules. Permitted statutory accounting practices encompass all accounting practices not so prescribed.

The states in which the Company’s life insurance subsidiaries are domiciled require the preparation of statutory-basis financial statements in conformity with the NAIC Accounting Practices and Procedures Manual, subject to any deviations prescribed or permitted by the applicable insurance commissioner and/or director. Statutory accounting practices differ from GAAP primarily since they require charging policy acquisition and certain sales inducement costs to expense as incurred, establishing life insurance reserves based on different actuarial assumptions, and valuing certain investments and establishing deferred taxes on a different basis.

Statutory net income and capital and surplus of the Company’s insurance subsidiaries, determined in accordance with statutory accounting practices prescribed or permitted by insurance regulatory authorities are as follows:

	Statutory Net Income						Statutory Capital and Surplus
	Years Ended December 31						December 31
	2021			2020			2021		2020
Amounts by insurance subsidiary:
Security National Life Insurance Company	$	5,552,116		$	6,054,764		$	57,424,808	$	53,089,185
Kilpatrick Life Insurance Company		1,312,718			1,574,128			15,566,231		15,177,996
First Guaranty Insurance Company		624,550			790,221			7,734,357		7,045,644
Memorial Insurance Company of America		37			55			-		1,088,034
Southern Security Life Insurance Company, Inc.		275			183			1,578,225		1,581,647
Trans-Western Life Insurance Company		(2,089	)		(1,527	)		508,547		510,636
Total	$	7,487,607		$	8,417,824		$	82,812,168	$	78,493,142

The Utah, Louisiana, Mississippi and Texas Insurance Departments impose minimum risk-based capital (RBC) requirements that were developed by the NAIC on insurance enterprises. The formulas for determining the RBC specify various factors that are applied to financial balances or various levels of activity based on the perceived degree of risk. Regulatory compliance is determined by a ratio (the Ratio) of the enterprise’s regulatory total adjusted capital, as defined by the NAIC, to its authorized control level, as defined by the NAIC. Enterprises below specific trigger points or ratios are classified within certain levels, each of which requires specified corrective action. The life insurance subsidiaries each have a ratio that is greater than the first level of regulatory action as of December 31, 2021.

Generally, the net assets of the life insurance subsidiaries available for transfer to the Company are limited to the amounts of the life insurance subsidiaries net assets, as determined in accordance with statutory accounting practices, that exceed minimum statutory capital requirements. Additional requirements must be met depending on the state, and payments of such amounts as dividends are subject to approval by regulatory authorities.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

14) Statutory Financial Information and Dividend Limitations (Continued)

Under the Utah Insurance Code, Security National Life Insurance Company is permitted to pay stockholder dividends, or otherwise make distributions, to the Company subject to certain limitations. Security National Life Insurance Company must ensure that its surplus held for policyholders is reasonable in relation to its outstanding liabilities and adequate to its financial needs after payment of any such dividend or distribution. Furthermore, where any dividend or distribution, together with all other dividends and distributions made within the preceding 12 months, exceeds the lesser of (i) 10% of its surplus held for policyholders as of the next preceding December 31; or (ii) its net gain from operations, not including realized capital gains, for the 12-month period ending the next preceding December 31, such dividend or distribution constitutes “extraordinary” under Utah law and Security National Life Insurance Company would be required to file notice of its intention to declare such a dividend or make such a distribution with the Utah Commissioner and the Utah Commissioner must either approve the distribution or dividend or not disapprove the dividend or distribution within 30 days’ of the notice filing. Based on Security National Life Insurance Company’s surplus held for policyholders and net gain from operations as of December 31, 2021, the maximum aggregate amount of dividends and distributions that it could pay or make in 2022 and which would not constitute an “extraordinary” dividend or distribution under Utah law, and would therefore not require notice and approval or lack of disproval from the Utah Commissioner, would be approximately $5,054,000.

Under the Louisiana Insurance Code, First Guaranty Insurance Company and Kilpatrick Life Insurance Company are permitted to pay stockholder dividends, or otherwise make distributions, to the Company subject to certain limitations. First Guaranty Insurance Company and Kilpatrick Life Insurance Company must ensure that its surplus held for policyholders is reasonable in relation to its outstanding liabilities and adequate to its financial needs after payment of any such dividend or distribution. Furthermore, where any dividend or distribution, together with all other dividends and distributions made within the preceding 12 months, exceeds the lesser of (i) 10% of its surplus held for policyholders as of the next preceding December 31; or (ii) its net gain from operations, not including realized capital gains, for the 12-month period ending the next preceding December 31, such dividend or distribution constitutes “extraordinary” under Louisiana law and First Guaranty Insurance Company and Kilpatrick Life Insurance Company would be required to file notice of its intention to declare such a dividend or make such a distribution with the Louisiana Commissioner and the Louisiana Commissioner must either approve the distribution or dividend or not disapprove the dividend or distribution within 30 days’ of the notice filing. Based on First Guaranty Insurance Company’s and Kilpatrick Life Insurance Company’s surplus held for policyholders and net gain from operations as of December 31, 2021, the maximum aggregate amount of dividends and distributions that it could pay or make in 2022 and which would not constitute an “extraordinary” dividend or distribution under Louisiana law, and would therefore not require notice and approval or lack of disproval from the Louisiana Commissioner, would be approximately $605,000 for First Guaranty Insurance Company and $950,000 for Kilpatrick Life Insurance Company.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

- Definition

Tabular disclosure of how the entity's reporting under GAAP as of the balance sheet date differs from the results based on prescribed and permitted accounting practices of the state or country of domicile in which a relevant statutory filing is made, or differences in results based on the National Association of Insurance Commissioners (NAIC) prescribed practices, or a combination thereof. Describes the accounting practices used and the related monetary effect on statutory surplus, net income, and risk-based capital. If an insurance enterprise's risk-based capital would have triggered a regulatory event had it not used a permitted practice, that fact is disclosed in the financial statements. Permitted statutory accounting practices include practices not prescribed but allowed by the domiciliary state insurance department regulatory authority.

+ References + Details

Schedule of Opening and Closing Balances of the Assets and Liabilities (Details) - USD ($)	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Disaggregation of Revenue [Line Items]
Contract with customer assets
Contract with customer liability	14,508,022	13,080,179	12,607,978
Pre-need Merchandise and Service Revenue [Member]
Disaggregation of Revenue [Line Items]
Contract with customer assets
Contract with customer liability	13,722,348	12,545,753	12,325,437
At-need Specialty Merchandise Revenue [Member]
Disaggregation of Revenue [Line Items]
Contract with customer assets
Contract with customer liability	785,674	534,426	282,541
Pre-need Land Sales [Member]
Disaggregation of Revenue [Line Items]
Contract with customer assets
Contract with customer liability

Acquisitions (Tables)

12 Months Ended

Dec. 31, 2021

Rivera Funerals Cremations and Memorial Gardens [Member]

Business Acquisition [Line Items]

Estimated Fair Values of Assets Acquired and Liabilities Assumed

The estimated fair values of the assets acquired and liabilities assumed as of the date of acquisition were as follows:


Restricted assets (1)	$	618,006
Property and equipment (2)		6,255,836
Cemetery land and improvements		658,280
Goodwill		1,338,763
Other (3)		2,440,516
Total assets acquired		11,311,401

Cemetery perpetual care obligation		(618,006	)
Other liabilities - holdback		(1,120,000	)
Total liabilities assumed		(1,738,006	)
Fair value of net assets acquired/consideration paid	$	9,573,395

(1)		Includes $39,000 of cash and $579,006 of fixed maturity securities, available for sale, at estimated fair value which is a Level 2 asset in the fair value hierarchy

(2)		At estimated fair value which is a Level 3 asset in the fair value hierarchy

(3)		Including $2,310,000 of intangible assets

Holbrook Mortuary [Member]

Business Acquisition [Line Items]

Estimated Fair Values of Assets Acquired and Liabilities Assumed

The estimated fair values of the assets acquired and liabilities assumed as of the date of acquisition were as follows:


Property and equipment (1)	$	2,641,210
Goodwill		395,432
Other		15,105
Total assets acquired		3,051,747

Fair value of net assets acquired/consideration paid	$	3,051,747

Schedule of Carrying Value of Intangible Asset (Details) - USD ($)

12 Months Ended

Dec. 31, 2021

Dec. 31, 2020

Finite-Lived Intangible Assets [Line Items]

Finite-lived intangible assets, accumulated amortization

$ (297,333)

$ (197,334)

Finite-lived intangible assets, net

$ 3,512,667

1,302,666

Trade Names [Member]

Finite-Lived Intangible Assets [Line Items]

Finite-Lived Intangible Asset, Useful Life

15 years

Finite-lived intangible assets, gross

^[1]

$ 2,100,000

Customer Lists [Member]

Finite-Lived Intangible Assets [Line Items]

Finite-Lived Intangible Asset, Useful Life

15 years

Finite-lived intangible assets, gross

$ 890,000

890,000

Trade Names Two [Member]

Finite-Lived Intangible Assets [Line Items]

Finite-Lived Intangible Asset, Useful Life

^[2]

15 years

Finite-lived intangible assets, gross

^[2]

$ 610,000

610,000

Other [Member]

Finite-Lived Intangible Assets [Line Items]

Finite-Lived Intangible Asset, Useful Life

^[1]

15 years

Finite-lived intangible assets, gross

^[1]

$ 210,000

[1]	See Note 20 regarding the acquisition of Rivera Funerals, Cremations and Memorial Gardens
[2]	Kilpatrick Life

Schedule of Derivative Assets at Fair Value (Details) - USD ($)	Dec. 31, 2021	Dec. 31, 2020
Loan Commitments [Member]
Subsidiary, Sale of Stock [Line Items]
Derivative, notional amount	$ 862,568,967	$ 659,245,038
Derivative asset, notional amount	8,563,410	12,592,672
Derivative liability, notional amount	1,547,895	2,464,062
Call Options [Member]
Subsidiary, Sale of Stock [Line Items]
Derivative, notional amount	982,500	1,873,200
Derivative asset, notional amount
Derivative liability, notional amount	50,936	43,097
Put Options [Member]
Subsidiary, Sale of Stock [Line Items]
Derivative, notional amount	362,900
Derivative asset, notional amount
Derivative liability, notional amount	4,493
Net Derivatives Loan Commitments [Member]
Subsidiary, Sale of Stock [Line Items]
Derivative, notional amount	863,914,367	661,118,238
Derivative asset, notional amount	8,563,410	12,592,672
Derivative liability, notional amount	$ 1,603,324	$ 2,507,159

Stock Compensation Plans (Tables)

12 Months Ended

Dec. 31, 2021

Share-based Payment Arrangement [Abstract]

Schedule of Assumptions Used

The following table summarizes the assumptions used in estimating the fair value of each option granted along with the weighted-average fair value of the options granted.

Schedule of Assumptions Used

				Assumptions
Grant Date	Plan	Weighted-Average Fair Value of Each Option		Expected Dividend Yield (1)			Underlying stock FMV		Weighted-Average Volatility			Weighted-Average Risk-Free Interest Rate			Weighted-Average Expected Life (years)
December 3, 2021	All Plans	$	2.99		5	%	$	8.62		36.50	%		1.15	%		5.31

March 27, 2020	All Plans	$	0.65		5	%	$	3.76		32.29	%		1.64	%		4.82

Schedule of Activity of Stock Option Plans

Activity of the stock option plans is summarized as follows:

	Number of Class A Shares			Weighted Average Exercise Price		Number of Class C Shares			Weighted Average Exercise Price
Outstanding at January 1, 2020		1,086,053		$	4.20		594,132		$	5.10
Adjustment for the effect of stock dividends		27,968					19,354
Granted		77,000					180,000
Exercised		(116,487	)				(130,820	)
Cancelled		(1,671	)				-

Outstanding at December 31, 2020		1,072,863		$	4.12		662,666		$	4.50
Adjustment for the effect of stock dividends		47,594					33,136
Granted		89,500					230,000
Exercised		(183,935	)				(104,656	)
Cancelled		(1,671	)				-

Outstanding at December 31, 2021		1,024,351		$	4.61		821,146		$	5.48

Exercisable at end of year		934,851		$	4.23		591,146		$	4.26

Available options for future grant		232,376					16,689

Weighted average contractual term of options outstanding at December 31, 2021		4.54 years					7.24 years

Weighted average contractual term of options exercisable at December 31, 2021		4.03 years					6.62 years

Aggregated intrinsic value of options outstanding at December 31, 2021 (1)	$	4,700,708				$	3,009,168

Aggregated intrinsic value of options exercisable at December 31, 2021 (1)	$	4,648,798				$	2,918,768

Schedule of Fair Value Assets and Liabilities Measured on a Recurring Basis (Details) - USD ($)

Dec. 31, 2021

Dec. 31, 2020

Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]

Fixed maturity securities, available for sale, at estimated fair value (amortized cost of $236,303,310 and $265,150,484 for 2021 and 2020)

$ 259,287,603

$ 294,656,679

Equity securities

11,596,414

11,324,239

Loans held for sale

302,776,827

422,772,418

Restricted assets

1,601,688

^[1]

1,473,637

^[2]

Restricted assets

3,603,822

^[3]

2,515,778

^[4]

Cemetery perpetual care trust investments

784,765

^[1]

747,767

^[2]

Cemetery perpetual care trust investments

3,302,480

^[3]

2,062,303

^[4]

Derivatives - loan commitments

8,563,410

^[5]

12,592,672

^[6]

Total assets accounted for at fair value on a recurring basis

591,517,009

748,145,493

Derivatives - call options

(50,936)

^[7]

(43,097)

^[8]

Derivatives - put options

^[7]

(4,493)

Derivatives - loan commitments

(1,547,895)

^[7]

(2,464,062)

^[8]

Total liabilities accounted for at fair value on a recurring basis

(1,603,324)

(2,507,159)

Fair Value, Inputs, Level 1 [Member]

Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]

Fixed maturity securities, available for sale, at estimated fair value (amortized cost of $236,303,310 and $265,150,484 for 2021 and 2020)

Equity securities

11,596,414

11,324,239

Loans held for sale

Restricted assets

^[1]

^[2]

Restricted assets

3,603,822

^[3]

2,515,778

^[4]

Cemetery perpetual care trust investments

^[1]

^[2]

Cemetery perpetual care trust investments

3,302,480

^[3]

2,062,303

^[4]

Derivatives - loan commitments

^[5]

^[6]

Total assets accounted for at fair value on a recurring basis

18,502,716

15,902,320

Derivatives - call options

(50,936)

^[7]

(43,097)

^[8]

Derivatives - put options

^[7]

(4,493)

Derivatives - loan commitments

^[7]

^[8]

Total liabilities accounted for at fair value on a recurring basis

(55,429)

(43,097)

Fair Value, Inputs, Level 2 [Member]

Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]

Fixed maturity securities, available for sale, at estimated fair value (amortized cost of $236,303,310 and $265,150,484 for 2021 and 2020)

257,264,255

292,455,504

Equity securities

Loans held for sale

Restricted assets

1,601,688

^[1]

1,473,637

^[2]

Restricted assets

^[3]

^[4]

Cemetery perpetual care trust investments

784,765

^[1]

747,767

^[2]

Cemetery perpetual care trust investments

^[3]

^[4]

Derivatives - loan commitments

^[5]

^[6]

Total assets accounted for at fair value on a recurring basis

259,650,708

294,676,908

Derivatives - call options

^[7]

^[8]

Derivatives - put options

^[7]

Derivatives - loan commitments

^[7]

^[8]

Total liabilities accounted for at fair value on a recurring basis

Fair Value, Inputs, Level 3 [Member]

Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]

Fixed maturity securities, available for sale, at estimated fair value (amortized cost of $236,303,310 and $265,150,484 for 2021 and 2020)

2,023,348

2,201,175

Equity securities

Loans held for sale

302,776,827

422,772,418

Restricted assets

^[1]

^[2]

Restricted assets

^[3]

^[4]

Cemetery perpetual care trust investments

^[1]

^[2]

Cemetery perpetual care trust investments

^[3]

^[4]

Derivatives - loan commitments

8,563,410

^[5]

12,592,672

^[6]

Total assets accounted for at fair value on a recurring basis

313,363,585

437,566,265

Derivatives - call options

^[7]

^[8]

Derivatives - put options

^[7]

Derivatives - loan commitments

(1,547,895)

^[7]

(2,464,062)

^[8]

Total liabilities accounted for at fair value on a recurring basis

$ (1,547,895)

$ (2,464,062)

[1]	Fixed maturity securities available for sale
[2]	Fixed maturity securities available for sale
[3]	Equity securities
[4]	Equity securities
[5]	Included in other assets on the consolidated balance sheets
[6]	Included in other assets on the consolidated balance sheets
[7]	Included in other liabilities and accrued expenses on the consolidated balance sheets
[8]	Included in other liabilities and accrued expenses on the consolidated balance sheets

Schedule of Changes in accumulated other comprehensive income (Details) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Equity [Abstract]
Unrealized gains on fixed maturity securities available for sale	$ (7,323,241)	$ 12,016,464
Amounts reclassified into net earnings	805,510	(2,772)
Net unrealized gains before taxes	(6,517,731)	12,013,692
Tax expense	1,368,721	(2,522,876)
Net	(5,149,010)	9,490,816
Unrealized gains on restricted assets (1)	(23,250)	41,225
Tax expense	5,792	(10,269)
Net	(17,458)	30,956
Unrealized gains on cemetery perpetual care trust investments (1)	(11,114)	(6,817)
Tax expense	2,769	1,698
Net	(8,345)	(5,119)
Unrealized gains for foreign currency translations adjustments	2,835	(46)
Tax expense	(707)	12
Net	2,128	(34)
Other comprehensive income changes	$ (5,172,685)	$ 9,516,619

Receivables

12 Months Ended

Dec. 31, 2021

Receivables [Abstract]

Receivables

4) Receivables

Receivables consist of the following:

Schedule of Receivables


	December 31
	2021			2020
Trade contracts	$	5,298,636		$	4,119,988
Receivables from sales agents		2,360,807			2,677,774
Other		12,457,398			5,786,827
Total receivables		20,116,841			12,584,589
Allowance for doubtful accounts		(1,800,725	)		(1,685,382	)
Net receivables	$	18,316,116		$	10,899,207

Schedule of Investments (Details) - USD ($)

12 Months Ended

Dec. 31, 2021

Dec. 31, 2020

Marketable Securities [Line Items]

Available for sale securities, amortized cost

$ 236,303,310

$ 265,150,484

Available for sale securities, unrecognized holding gain

23,501,282

30,456,040

Available for sale securities, unrecognized holding loss

(516,989)

(949,845)

Available for sale securities, Estimated fair value

259,287,603

294,656,679

Available-for-sale securities, amortized cost basis

8,275,772

9,698,490

Available for Sale Securities - Estimated Fair Value

11,596,414

11,324,239

Mortgage loans on real estate and construction

277,306,046

249,343,936

Mortgage loans on real estate and construction, unamortized deferred loan fees, net

(918,586)

1,161,132

Mortgage loans on real estate and construction, allowance for losses

(1,699,902)

(2,005,127)

Mortgage loans on real estate and construction, Discount

(409,983)

(1,260,896)

Real estate held for investment, net of depreciation

197,365,797

131,684,453

Real estate held for sale

3,731,300

7,878,807

Policy loans

13,478,214

14,171,589

Insurance assignments

48,632,808

53,231,131

Federal home loan bank stock

2,547,100

^[1]

2,506,600

^[2]

Other investments

4,983,251

5,432,816

Allowance for doubtful accounts

(1,686,218)

(1,645,475)

Total policy loans and other investments

67,955,155

73,696,661

Accrued investment income

6,313,012

5,360,523

Total investments

823,555,327

773,945,298

Mortgage loans on real estate and construction, unamortized deferred loan fees, net

918,586

(1,161,132)

US Treasury Securities [Member]

Marketable Securities [Line Items]

Available for sale securities, amortized cost

22,307,736

42,381,805

Available for sale securities, unrecognized holding gain

578,567

1,358,562

Available for sale securities, unrecognized holding loss

Available for sale securities, Estimated fair value

22,886,303

43,740,367

US States and Political Subdivisions Debt Securities [Member]

Marketable Securities [Line Items]

Available for sale securities, amortized cost

4,649,917

5,383,762

Available for sale securities, unrecognized holding gain

212,803

312,214

Available for sale securities, unrecognized holding loss

(1,989)

(1,261)

Available for sale securities, Estimated fair value

4,860,731

5,694,715

Corporate Debt Securities [Member]

Marketable Securities [Line Items]

Available for sale securities, amortized cost

174,711,061

186,067,912

Available for sale securities, unrecognized holding gain

21,791,370

27,216,496

Available for sale securities, unrecognized holding loss

(353,668)

(681,478)

Available for sale securities, Estimated fair value

196,148,763

212,602,930

Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member]

Marketable Securities [Line Items]

Available for sale securities, amortized cost

34,365,382

31,047,791

Available for sale securities, unrecognized holding gain

905,159

1,565,377

Available for sale securities, unrecognized holding loss

(161,332)

(267,106)

Available for sale securities, Estimated fair value

35,109,209

32,346,062

Redeemable Preferred Stock [Member]

Marketable Securities [Line Items]

Available for sale securities, amortized cost

269,214

Available for sale securities, unrecognized holding gain

13,383

3,391

Available for sale securities, unrecognized holding loss

Available for sale securities, Estimated fair value

282,597

272,605

Industrial Miscellaneous And All Other [Member]

Marketable Securities [Line Items]

Available-for-sale securities, amortized cost basis

8,275,772

9,698,490

Available for sale securities, unrecognized holding gain

3,626,444

2,376,156

Available for sale securities, unrecognized holding gain

(305,802)

(750,407)

Available for Sale Securities - Estimated Fair Value

11,596,414

11,324,239

Equity Securities One [Member]

Marketable Securities [Line Items]

Available-for-sale securities, amortized cost basis

8,275,772

Available for sale securities, unrecognized holding gain

3,626,444

Available for sale securities, unrecognized holding gain

(305,802)

Available for Sale Securities - Estimated Fair Value

11,596,414

Residential Mortgage [Member]

Marketable Securities [Line Items]

Mortgage loans on real estate and construction

53,533,712

95,822,448

Real estate held for investment, net of depreciation

41,972,462

24,843,743

Real estate held for sale

1,190,602

3,478,254

Residential Construction [Member]

Marketable Securities [Line Items]

Mortgage loans on real estate and construction

175,117,783

111,111,777

Commercial [Member]

Marketable Securities [Line Items]

Mortgage loans on real estate and construction

51,683,022

46,836,866

Real estate held for investment, net of depreciation

155,393,335

106,840,710

Real estate held for sale

$ 2,540,698

4,400,553

Equity Securities 1 [Member]

Marketable Securities [Line Items]

Available-for-sale securities, amortized cost basis

9,698,490

Available for sale securities, unrecognized holding gain

2,376,156

Available for sale securities, unrecognized holding gain

(750,407)

Available for Sale Securities - Estimated Fair Value

$ 11,324,239

[1]	Includes $905,700 of Membership stock and $1,641,400 of Activity stock due to short-term advances and letters of credit.
[2]	Includes $866,900 of Membership stock and $1,639,700 of Activity stock due to short-term advances and letters of credit.

Schedule of Activity of Stock Option Plans (Details) - USD ($)

12 Months Ended

Dec. 31, 2021

Dec. 31, 2020

Common Class A [Member]

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Number of shares, outstanding, beginning

1,072,863

1,086,053

Weighted average exercise price, outstanding, beginning

$ 4.12

$ 4.20

Number of Shares, adjustment for effect of stock dividends

47,594

27,968

Number of shares, granted

89,500

77,000

Number of shares, exercised

(183,935)

(116,487)

Number of shares, cancelled

(1,671)

Weighted average exercise price, outstanding, ending

$ 4.61

$ 4.12

Number of shares, outstanding, ending

1,024,351

1,072,863

Number of shares, options exercisable

934,851

Weighted average exercise price, options exercisable

$ 4.23

Number of shares, available options for future grant

232,376

Weighted average contractual term of options outstanding

4 years 6 months 14 days

Weighted average contractual term of options exercisable

4 years 10 days

Aggregated intrinsic value of options outstanding

^[1]

$ 4,700,708

Aggregated intrinsic value of options exercisable

^[1]

$ 4,648,798

Common Class C [Member]

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Number of shares, outstanding, beginning

662,666

594,132

Weighted average exercise price, outstanding, beginning

$ 4.50

$ 5.10

Number of Shares, adjustment for effect of stock dividends

33,136

19,354

Number of shares, granted

230,000

180,000

Number of shares, exercised

(104,656)

(130,820)

Number of shares, cancelled

Weighted average exercise price, outstanding, ending

$ 5.48

$ 4.50

Number of shares, outstanding, ending

821,146

662,666

Number of shares, options exercisable

591,146

Weighted average exercise price, options exercisable

$ 4.26

Number of shares, available options for future grant

16,689

Weighted average contractual term of options outstanding

7 years 2 months 26 days

Weighted average contractual term of options exercisable

6 years 7 months 13 days

Aggregated intrinsic value of options outstanding

^[1]

$ 3,009,168

Aggregated intrinsic value of options exercisable

^[1]

$ 2,918,768

[1]	The Company used a stock price of $9.20 as of December 31, 2021 to derive intrinsic value.

Assumptions Used in Determining MSR Value (Details)	12 Months Ended
Assumptions Used in Determining MSR Value (Details)	Dec. 31, 2021	Dec. 31, 2020
Goodwill and Intangible Assets Disclosure [Abstract]
Prepayment speed	0.1160	0.1560
Average life	6 years 7 months 20 days	5 years 3 months 18 days
Discount rate	0.0950	0.0950

Schedule of Opening and Closing Balances of Receivables, Contract Assets and Contract Liabilities (Details) - USD ($)

12 Months Ended

Dec. 31, 2021

Dec. 31, 2020

Revenue from Contract with Customer [Abstract]

Receivables, beginning balance

^[1]

$ 4,119,988

$ 2,778,879

Contract asset, beginning balance

Contract liability, beginning balance

13,080,179

12,607,978

Receivables, ending balance

^[1]

5,298,636

4,119,988

Contract asset, ending balance

Contract liability, ending balance

14,508,022

13,080,179

Increase (decrease) in accounts receivable

^[1]

1,178,648

1,341,109

Increase (decrease) in contract asset

Increase (decrease) in contract liability

$ 1,427,843

$ 472,201

[1]	Included in Receivables, net on the consolidated balance sheets

Schedule of Investments Classified by Contractual Maturity Date (Details) - USD ($)	Dec. 31, 2021	Dec. 31, 2020
Marketable Securities [Line Items]
Amortized cost	$ 236,303,310	$ 265,150,484
Estimated fair value	259,287,603	294,656,679
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member]
Marketable Securities [Line Items]
Amortized cost	34,365,382	31,047,791
Estimated fair value	35,109,209	32,346,062
Redeemable Preferred Stock [Member]
Marketable Securities [Line Items]
Amortized cost	269,214	269,214
Estimated fair value	282,597	$ 272,605
Due in 1 year [Member]
Marketable Securities [Line Items]
Amortized cost	68,966
Estimated fair value	70,024
Due in 2-5 years [Member]
Marketable Securities [Line Items]
Amortized cost	62,958,696
Estimated fair value	65,605,915
Due in 5-10 years [Member]
Marketable Securities [Line Items]
Amortized cost	70,740,783
Estimated fair value	77,346,448
Due in more than 10 years [Member]
Marketable Securities [Line Items]
Amortized cost	67,900,269
Estimated fair value	$ 80,873,410

Schedule of Fair Value Assets Measured on a Nonrecurring Basis (Details) - USD ($)	Dec. 31, 2021	Dec. 31, 2020
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired mortgage loans held for investment	$ 851,903	$ 1,297,356
Impaired real estate held for investment	2,000,000	4,249,000
Assets fair value disclosure nonrecurring	2,851,903	5,546,356
Fair Value, Inputs, Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired mortgage loans held for investment
Impaired real estate held for investment
Assets fair value disclosure nonrecurring
Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired mortgage loans held for investment
Impaired real estate held for investment
Assets fair value disclosure nonrecurring
Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired mortgage loans held for investment	851,903	1,297,356
Impaired real estate held for investment	2,000,000	4,249,000
Assets fair value disclosure nonrecurring	$ 2,851,903	$ 5,546,356

Income Taxes (Details Narrative)	12 Months Ended
Income Taxes (Details Narrative)	Dec. 31, 2021	Dec. 31, 2020
Income Tax Disclosure [Abstract]
Effective income tax rate reconciliation, percent	23.70%	22.20%
Federal statutory income tax rate, percent	21.00%

Summary of Income Tax Liability (Details) - USD ($)	Dec. 31, 2021	Dec. 31, 2020
Income Tax Disclosure [Abstract]
Current	$ (1,558,687)	$ 2,595,877
Deferred	32,594,783	22,662,923
Total	$ 31,036,096	$ 25,258,800

Reinsurance, Commitments and Contingencies

12 Months Ended

Dec. 31, 2021

Commitments and Contingencies Disclosure [Abstract]

Reinsurance, Commitments and Contingencies

10) Reinsurance, Commitments and Contingencies

Reinsurance

The Company follows the procedure of reinsuring risks in excess of a specified limit, which ranged from $25,000 to $100,000 during the years 2021 and 2020. The Company is liable for these amounts in the event such reinsurers are unable to pay their portion of the claims. The Company has also assumed insurance from other companies having insurance in force amounting to approximately $129,000,000 and approximately $96,000,000 at December 31, 2021 and 2020, respectively. See Financial Statement Schedule IV for information regarding premiums for direct business, reinsurance assumed and reinsurance ceded.

Mortgage Loan Loss Settlements

Future loan losses can be extremely difficult to estimate. However, the Company believes that its reserve methodology and its current practice of property preservation allow it to estimate potential losses on loans sold. The estimated liability for indemnification losses is included in other liabilities and accrued expenses and, as of December 31, 2021 and 2020, the balances were $2,447,000 and $20,584,000, respectively. The Company believes that the loan loss reserve as of December 31, 2021, represents its best estimate for adequate loss reserves on loans sold.

Mortgage Loan Loss Litigation

Settlement Agreement and Mutual Release with Lehman Brothers Holdings Inc.

From 2004 to early 2008, SecurityNational Mortgage Company (“SecurityNational Mortgage”), a wholly owned subsidiary of the Company, originated “limited documentation” or “reduced documentation” loans which were sold to certain affiliates of Lehman Brothers Holdings Inc. (“Lehman Holdings”). Certain of these loans became the subject of disputes between SecurityNational Mortgage and Lehman Holdings and certain Lehman Holdings affiliates. Lehman Holdings filed a Petition for Relief under Chapter 11 of the United States Bankruptcy Code in 2008. In May of 2011, SecurityNational Mortgage filed a complaint in U.S. District Court against certain Lehman Holdings affiliates. In June of 2011, Lehman Holdings filed a complaint in Federal District Court against SecurityNational Mortgage, both the complaint filed in May 2011 and that filed in June 2011 were later resolved. In 2016, certain other pending loan disputes between SecurityNational Mortgage and Lehman Holdings became the subject of an unsuccessful, non-binding alternate dispute resolution mediation proceeding.

Thereafter, in 2016, Lehman Holdings filed an adversary proceeding complaint against approximately 150 mortgage loan originators, including SecurityNational Mortgage, in the U.S. Bankruptcy Court of the Southern District of New York, which included seeking damages relating to the alleged obligations of the defendants under indemnification provisions of alleged agreements, in amounts to be determined at trial, including interest, attorneys’ fees and costs incurred by Lehman Holdings in enforcing the obligations of the defendants. The complaint was later amended with the latest amended complaint filed against SecurityNational Mortgage on December 27, 2016, seeking damages to be determined at trial, including interest, attorneys’ fees and costs. This complaint involved approximately 135 mortgage loans, there being millions of dollars allegedly in dispute. These claims against SecurityNational Mortgage were asserted as a result of Lehman Holdings’ earlier settlements with the Federal National Mortgage Association (“Fannie Mae”) and the Federal Home Loan Corporation (“Freddie Mac”).

In 2018, Lehman Holdings filed a separate adversary proceeding complaint against SecurityNational Mortgage. This adversary proceeding allegedly involved approximately 577 mortgage loans relative to private securitization trusts (“RMBS Loans”) and millions of dollars in damages. Thereafter, Lehman Holdings made a filing that effectively reduced the number of RMBS Loans to 248. This proceeding was in addition to the above-referenced proceeding involving the Fannie Mae and Freddie Mac mortgage loans. As with the above-referenced proceeding, damages were sought including interest, costs, and attorneys’ fees.

SecurityNational Mortgage, as well as other defendants, have been involved in written discovery, and production of documents relative to the cases, and the filing of motions. The deposition phase of the cases was yet to begin, as well as the later expert witness phase. Those phases would require substantial expenditures of legal fees and costs.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

10) Reinsurance, Commitments and Contingencies (Continued)

On February 1, 2021, SecurityNational Mortgage executed a settlement agreement with Lehman Holdings in relation to these two adversary proceedings wherein all mortgage loan related claims were resolved, thereby ending all liabilities asserted by Lehman Holdings and conclusively ending all proceedings between SecurityNational Mortgage and Lehman Holdings. The full amount of SecurityNational Mortgage’s settlement payment was accounted for in the Company’s loan loss reserve as of December 31, 2020 and was paid during the first quarter 2021.

Non-Cancelable Leases

The Company leases office space and equipment under various non-cancelable agreements. See Note 24 regarding leases.

Other Contingencies and Commitments

The Company has entered into commitments to fund construction and land development loans and has also provided financing for land acquisition and development. As of December 31, 2021, the Company’s commitments were approximately $329,903,000, for these loans of which $179,674,000 had been funded. The Company advances funds once the work has been completed and an independent inspection is made. The maximum loan commitment ranges between 50% and 80% of appraised value. The Company receives fees and interest for these loans and the interest rate is generally fixed 5.50% to 8.00% per annum. Maturities range between six and eighteen months.

The Company belongs to a captive insurance group for certain casualty insurance, worker compensation and liability programs. Insurance reserves are maintained relative to these programs. The level of exposure from catastrophic events is limited by the purchase of stop-loss and aggregate liability reinsurance coverage. When estimating the insurance liabilities and related reserves, the captive insurance management considers a number of factors, which include historical claims experience, demographic factors, severity factors and valuations provided by independent third-party actuaries. If actual claims or adverse development of loss reserves occurs and exceed these estimates, additional reserves may be required. The estimation process contains uncertainty since captive insurance management must use judgment to estimate the ultimate cost that will be incurred to settle reported claims and unreported claims for incidents incurred but not reported as of the balance sheet date.

The Company is a defendant in various other legal actions arising from the normal conduct of business. Management believes that none of the actions will have a material effect on the Company’s financial position or results of operations. Based on management’s assessment and legal counsel’s representations concerning the likelihood of unfavorable outcomes, no amounts have been accrued for the above claims in the consolidated financial statements.

The Company is not a party to any other material legal proceedings outside the ordinary course of business or to any other legal proceedings, which, if adversely determined, would have a material adverse effect on its financial condition or results of operations.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

Loans Held for Sale (Details Narrative) - USD ($)	12 Months Ended
Loans Held for Sale (Details Narrative) - USD ($)	Dec. 31, 2021	Dec. 31, 2020
Loans Held For Sale
Provision on current loan originations	$ 2,211,230	$ 4,938,214
Loan increase per point	$ 390	$ 890
Amount of loan increased, per point	$ 1,000,000	$ 1,000,000
Additional provision for loan loss reserve		$ 16,506,030

Schedule of Gains and Losses on Derivatives (Details) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Loan Commitments [Member]
Subsidiary, Sale of Stock [Line Items]
Gain (loss) on derivatives	$ (3,113,095)	$ 7,637,377
Call and Put Options [Member]
Subsidiary, Sale of Stock [Line Items]
Gain (loss) on derivatives	$ 160,410	$ 272,758

Summary of Activities in Shares of Capital Stock (Details) - shares	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Common Class A [Member]
Class of Stock [Line Items]
Common Stock, Shares, Outstanding	16,595,783	16,107,779
Exercise of stock options	160,282	68,970
Stock dividends	837,410	405,210
Conversion of Class C to Class A	49,247	13,824
Common Stock, Shares, Outstanding	17,642,722	16,595,783
Common Class C [Member]
Class of Stock [Line Items]
Common Stock, Shares, Outstanding	2,679,603	2,500,887
Exercise of stock options	104,656	130,820
Stock dividends	131,553	61,720
Conversion of Class C to Class A	(49,247)	(13,824)
Common Stock, Shares, Outstanding	2,866,565	2,679,603

Property and Equipment (Details Narrative) - USD ($)	12 Months Ended
Property and Equipment (Details Narrative) - USD ($)	Dec. 31, 2021	Dec. 31, 2020
Property, Plant and Equipment [Line Items]
Depreciation expense	$ 1,935,613	$ 2,078,738
Property, Plant and Equipment, Gross	41,331,708	31,652,484
Transfer of cemetery land and improvements to property and equipment		1,516,700
Building [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Gross	3,640,755	1,723,000
Accumulated depreciation	$ 532,074	$ 0

Fair Value of Financial Instruments (Tables)

12 Months Ended

Dec. 31, 2021

Fair Value Disclosures [Abstract]

Schedule of Fair Value Assets and Liabilities Measured on a Recurring Basis

	Total			Quoted Prices in Active Markets for Identical Assets (Level 1)			Significant Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets accounted for at fair value on a recurring basis
Fixed maturity securities available for sale	$	259,287,603		$	-		$	257,264,255	$	2,023,348
Equity securities		11,596,414			11,596,414			-		-
Loans held for sale		302,776,827			-			-		302,776,827
Restricted assets (1)		1,601,688			-			1,601,688		-
Restricted assets (2)		3,603,822			3,603,822			-		-
Cemetery perpetual care trust investments (1)		784,765			-			784,765		-
Cemetery perpetual care trust investments (2)		3,302,480			3,302,480			-		-
Derivatives - loan commitments (3)		8,563,410			-			-		8,563,410
Total assets accounted for at fair value on a recurring basis	$	591,517,009		$	18,502,716		$	259,650,708	$	313,363,585

Liabilities accounted for at fair value on a recurring basis
Derivatives - call options (4)	$	(50,936	)	$	(50,936	)	$	-	$	-
Derivatives - put options (4)		(4,493	)		(4,493	)		-		-
Derivatives - loan commitments (4)		(1,547,895	)		-			-		(1,547,895	)
Total liabilities accounted for at fair value on a recurring basis	$	(1,603,324	)	$	(55,429	)	$	-	$	(1,547,895	)

(1)	Fixed maturity securities available for sale

(2)	Equity securities

(3)	Included in other assets on the consolidated balance sheets

(4)	Included in other liabilities and accrued expenses on the consolidated balance sheets

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

17) Fair Value of Financial Instruments (Continued)

	Total			Quoted Prices in Active Markets for Identical Assets (Level 1)			Significant Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets accounted for at fair value on a recurring basis
Fixed maturity securities available for sale	$	294,656,679		$	-		$	292,455,504	$	2,201,175
Equity securities		11,324,239			11,324,239			-		-
Loans held for sale		422,772,418			-			-		422,772,418
Restricted assets (1)		1,473,637			-			1,473,637		-
Restricted assets (2)		2,515,778			2,515,778			-		-
Cemetery perpetual care trust investments (1)		747,767			-			747,767		-
Cemetery perpetual care trust investments (2)		2,062,303			2,062,303			-		-
Derivatives - loan commitments (3)		12,592,672			-			-		12,592,672
Total assets accounted for at fair value on a recurring basis	$	748,145,493		$	15,902,320		$	294,676,908	$	437,566,265

Liabilities accounted for at fair value on a recurring basis
Derivatives - call options (4)	$	(43,097	)	$	(43,097	)	$	-	$	-
Derivatives - loan commitments (4)		(2,464,062	)		-			-		(2,464,062	)
Total liabilities accounted for at fair value on a recurring basis	$	(2,507,159	)	$	(43,097	)	$	-	$	(2,464,062	)

Assets and Liabilities Measured at Fair Value on A Recurring Basis

For Level 3 assets and liabilities measured at fair value on a recurring basis as of December 31, 2021, the significant unobservable inputs used in the fair value measurements were as follows:

				Significant	Range of Inputs
	Fair Value at		Valuation	Unobservable	Minimum			Maximum			Weighted
	12/31/2021		Technique	Input(s)	Value			Value			Average
Loans held for sale	$	302,776,827	Market approach	Investor contract pricing as a percentage of unpaid principal balance		95.0	%		109.0	%		103.0	%

Derivatives - loan commitments (net)		7,015,515	Market approach	Pull-through rate		66.0	%		95.0	%		81.0	%
				Initial-Value		N/A			N/A			N/A
				Servicing		0 bps			148 bps			61 bps

Fixed maturity securities available for sale		2,023,348	Broker quotes	Pricing quotes	$	96.87		$	111.11		$	106.73

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

17) Fair Value of Financial Instruments (Continued)

For Level 3 assets and liabilities measured at fair value on a recurring basis as of December 31, 2020, the significant unobservable inputs used in the fair value measurements were as follows:

				Significant	Range of Inputs
	Fair Value at		Valuation	Unobservable	Minimum			Maximum			Weighted
	12/31/2020		Technique	Input(s)	Value			Value			Average
Loans held for sale	$	422,772,418	Market approach	Investor contract pricing as a percentage of unpaid principal balance		99.0	%		110.0	%		104.0	%

Derivatives - loan commitments (net)		10,128,610	Market approach	Pull-through rate		52.0	%		92.0	%		81.0	%
				Initial-Value		N/A			N/A			N/A
				Servicing		0 bps			184 bps			58 bps

Fixed maturity securities available for sale		2,201,175	Broker quotes	Pricing quotes	$	90.83		$	119.33		$	113.47

Schedule of Changes in the Consolidated Balance Sheet Line Items Measured Using Level 3 Inputs

Following is a summary of changes in the consolidated balance sheet line items measured using level 3 inputs:

	Net Derivatives Loan Commitments			Loans Held for Sale			Fixed Maturity Securities Available for Sale

Balance - December 31, 2020	$	10,128,610		$	422,772,418		$	2,201,175
Originations/purchases		-			5,611,189,587			-
Sales, maturities and paydowns		-			(5,900,076,766	)		(45,700	)
Transfer to mortgage loans held for investment		-			(201,951	)		-
Total gains (losses):
Included in earnings		(3,113,095	)(1)		169,093,539	(1)		3,674	(2)
Included in other comprehensive income		-			-			(135,801	)

Balance - December 31, 2021	$	7,015,515		$	302,776,827		$	2,023,348

(1)	As a component of mortgage fee income on the consolidated statements of earnings

(2)	As a component of net investment income on the consolidated statements of earnings

Following is a summary of changes in the consolidated balance sheet line items measured using level 3 inputs:

	Net Derivatives Loan Commitments			Loans Held for Sale			Fixed Maturity Securities Available for Sale

Balance - December 31, 2019	$	2,491,233		$	213,457,632		$	3,216,382
Originations/purchases		-			5,627,013,749			-
Sales, maturities and paydowns		-			(5,600,045,285	)		(1,042,400	)
Transfer to mortgage loans held for investment		-			(16,960,549	)		-
Total gains (losses):
Included in earnings		7,637,377	(1)		199,306,871	(1)		3,408	(2)
Included in other comprehensive income		-			-			23,785

Balance - December 31, 2020	$	10,128,610		$	422,772,418		$	2,201,175

(1)	As a component of mortgage fee income on the consolidated statements of earnings

(2)	As a component of net investment income on the consolidated statements of earnings

Schedule of Fair Value Assets Measured on a Nonrecurring Basis

	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets accounted for at fair value on a nonrecurring basis
Impaired mortgage loans held for investment	$	851,903	$	-	$	-	$	851,903
Impaired real estate held for sale		2,000,000		-		-		2,000,000
Total assets accounted for at fair value on a nonrecurring basis	$	2,851,903	$	-	$	-	$	2,851,903

	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets accounted for at fair value on a nonrecurring basis
Impaired mortgage loans held for investment	$	1,297,356	$	-	$	-	$	1,297,356
Impaired real estate held for sale		4,249,000		-		-		4,249,000
Total assets accounted for at fair value on a nonrecurring basis	$	5,546,356	$	-	$	-	$	5,546,356

Schedule of Financial Instruments Carried at Other Than Fair Value

The carrying values and estimated fair values for such financial instruments, and their corresponding placement in the fair value hierarchy, are summarized as follows as of December 31, 2021:

	Carrying Value			Level 1		Level 2		Level 3			Total Estimated Fair Value
Assets
Mortgage loans held for investment
Residential	$	51,396,172		$	-	$	-	$	55,159,167		$	55,159,167
Residential construction		174,691,408			-		-		174,691,408			174,691,408
Commercial		51,218,466			-		-		51,008,709			51,008,709
Mortgage loans held for investment, net	$	277,306,046		$	-	$	-	$	280,859,284		$	280,859,284
Policy loans		13,478,214			-		-		13,478,214			13,478,214
Insurance assignments, net (1)		46,946,590			-		-		46,946,590			46,946,590
Restricted assets (2)		2,732,320			-		-		2,732,320			2,732,320
Cemetery perpetual care trust investments (2)		1,823,533			-		-		1,823,533			1,823,533
Mortgage servicing rights, net		53,060,455			-		-		68,811,809			68,811,809

Liabilities
Bank and other loans payable	$	(251,286,927	)	$	-	$	-	$	(251,286,927	)	$	(251,286,927	)
Policyholder account balances (3)		(42,939,055	)		-		-		(35,855,934	)		(35,855,934	)
Future policy benefits - annuities (3)		(107,992,830	)		-		-		(116,215,717	)		(116,215,717	)

(1)	Included in other investments and policy loans on the consolidated balance sheets

(2)	Mortgage loans held for investment

(3)	Included in future policy benefits and unpaid claims on the consolidated balance sheets

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

17) Fair Value of Financial Instruments (Continued)

The carrying values and estimated fair values for such financial instruments, and their corresponding placement in the fair value hierarchy, are summarized as follows as of December 31, 2020:

	Carrying Value			Level 1		Level 2		Level 3			Total Estimated Fair Value
Assets
Mortgage loans held for investment
Residential	$	92,757,613		$	-	$	-	$	100,384,283		$	100,384,283
Residential construction		110,849,864			-		-		110,849,864			110,849,864
Commercial		45,736,459			-		-		45,259,425			45,259,425
Mortgage loans held for investment, net	$	249,343,936		$	-	$	-	$	256,493,572		$	256,493,572
Policy loans		14,171,589			-		-		14,171,589			14,171,589
Insurance assignments, net (1)		51,585,656			-		-		51,585,656			51,585,656
Restricted assets (2)		3,317,877			-		-		3,317,877			3,317,877
Cemetery perpetual care trust investments (2)		1,468,600			-		-		1,468,600			1,468,600
Mortgage servicing rights, net		35,210,516			-		-		38,702,358			38,702,358

Liabilities
Bank and other loans payable	$	(297,824,368	)	$	-	$	-	$	(297,824,368	)	$	(297,824,368	)
Policyholder account balances (3)		(44,026,809	)		-		-		(42,220,725	)		(42,220,725	)
Future policy benefits - annuities (3)		(106,522,113	)		-		-		(112,354,186	)		(112,354,186	)

(1)	Included in other investments and policy loans on the consolidated balance sheets

(2)	Mortgage loans held for investment

(3)	Included in future policy benefits and unpaid claims on the consolidated balance sheets

Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2021

Accounting Policies [Abstract]

General Overview of Business

General Overview of Business

Basis of Presentation

Basis of Presentation

The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (GAAP).

Principles of Consolidation

Principles of Consolidation

Use of Estimates

Use of Estimates

Investments

Investments

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

1) Significant Accounting Policies (Continued)

Real estate held for sale is carried at lower of cost or fair value. Depreciation is not recognized on real estate classified as held for sale.

Other investments and policy loans are carried at the aggregate unpaid balances, less allowances for losses.

Accrued investment income refers to earned income from investments that has not yet been received by the Company.

Cash and Cash Equivalents

Cash and Cash Equivalents

Loans Held for Sale

Loans Held for Sale

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

1) Significant Accounting Policies (Continued)

Mortgage Fee Income

Mortgage Fee Income

	●	Failure to deliver original documents specified by the investor,
	●	The existence of misrepresentation or fraud in the origination of the loan,
	●	The loan becomes delinquent due to nonpayment during the first several months after it is sold,
	●	Early pay-off of a loan, as defined by the agreements,
	●	Excessive time to settle a loan,
	●	Investor declines purchase, and
	●	Discontinued product and expired commitment.

	●	Research reasons for rejection,
	●	Provide additional documents,
	●	Request investor exceptions,
	●	Appeal rejection decision to purchase committee, and
	●	Commit to secondary investors.

Determining Fair Value

Determining Fair Value

	●	For loans that are committed, the Company uses the commitment price.
	●	For loans that are non-committed that have an active market, the Company uses the market price.
	●	For loans that are non-committed where there is no market but there is a similar product, the Company uses the market value for the similar product.
	●	For loans that are non-committed where no active market exists, the Company determines that the unpaid principal balance best approximates the market value, after considering the fair value of the underlying real estate collateral, estimated future cash flows, and the loan interest rate.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

1) Significant Accounting Policies (Continued)

The majority of loans originated are sold to third-party investors. The amounts expected to be sold to investors are shown on the consolidated balance sheets as loans held for sale.

Loan Loss Reserve

Loan Loss Reserve

Repurchase demand — A repurchase demand usually occurs when there is a significant payment default, error in underwriting or detected loan fraud.

Indemnification demand — On certain loans the Company has negotiated a set fee that is to be paid in lieu of repurchase. The fee varies by investor and by loan product type.

The Company believes the allowance for loan losses and the loan loss reserve represent probable loan losses incurred as of the balance sheet date.

Additional information related to the Loan Loss Reserve is included in Note 3.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

1) Significant Accounting Policies (Continued)

Restricted Assets

Restricted Assets

Cemetery Perpetual Care Trust Investments

Cemetery Perpetual Care Trust Investments

Cemetery Land and Improvements

Deferred Policy Acquisition Costs and Value of Business Acquired

Deferred Policy Acquisition Costs and Value of Business Acquired

Value of business acquired (“VOBA”) is the present value of estimated future profits of the acquired business and is amortized similar to deferred policy acquisition costs.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

1) Significant Accounting Policies (Continued)

Premium Deficiency and Loss Recognition Testing

Mortgage Servicing Rights

Mortgage Servicing Rights

Mortgage Servicing Rights (“MSR”) arise from contractual agreements between the Company and third-party investors (or their agents) when mortgage loans are sold. Under these contracts, the Company is obligated to retain and provide loan servicing functions on loans sold, in exchange for fees and other remuneration. The servicing functions typically performed include, among other responsibilities, collecting and remitting loan payments; responding to borrower inquiries; accounting for principal and interest, holding custodial (impound) funds for payment of property taxes and insurance premiums; counseling delinquent mortgagors; and supervising the acquisition of real estate owned and property dispositions.

The total residential mortgage loans serviced for others consist primarily of agency conforming fixed-rate mortgage loans. The value of MSRs is derived from the net cash flows associated with the servicing contracts. The Company receives a servicing fee of generally about 0.250% annually on the remaining outstanding principal balances of the loans. Based on the result of the cash flow analysis, an asset or liability is recorded for mortgage servicing rights. The servicing fees are collected from the monthly payments made by the mortgagors. The Company generally receives other remuneration including rights to various mortgagor-contracted fees such as late charges, and collateral reconveyance charges and the Company is generally entitled to retain the interest earned on funds held pending remittance of mortgagor principal, interest, tax and insurance payments. Contractual servicing fees and late fees are included in other revenues on the consolidated statements of earnings.

The Company’s subsequent accounting for MSRs is based on the class of MSRs. The Company has identified two classes of MSRs: MSRs backed by mortgage loans with initial term of 30 years and MSRs backed by mortgage loans with initial term of 15 years. The Company distinguishes between these classes of MSRs due to their differing sensitivities to change in value as the result of changes in market. After being initially recorded at fair value, MSRs backed by mortgage loans are accounted for using the amortization method. Amortization expense is included in other expenses on the consolidated statements of earnings. MSR amortization is determined by amortizing the MSR balance in proportion to, and over the period of the estimated future net servicing income of the underlying financial assets.

Interest rate risk, prepayment risk, and default risk are inherent risks in MSR valuation. Interest rate changes largely drive prepayment rates. Refinance activity generally increases as rates decline. A significant decrease in rates beyond expectation could cause a decline in the value of the MSR. On the contrary, if rates increase borrowers are less likely to refinance or prepay their mortgage, which extends the duration of the loan and MSR values are likely to rise. Because of these risks, discount rates and prepayment speeds are used to estimate the fair value.

The Company periodically assesses MSRs for impairment. Impairment occurs when the current fair value of the MSR falls below the asset’s carrying value (carrying value is the amortized cost reduced by any related valuation allowance). If MSRs are impaired, the impairment is recognized in current period earnings and the carrying value of the MSRs is adjusted through a valuation allowance.

Management periodically reviews the various loan strata to determine whether the value of the MSRs in a given stratum is impaired and likely to recover. When management deems recovery of the value to be unlikely in the foreseeable future, a write-down of the cost of the MSRs for that stratum to its estimated recoverable value is charged to the valuation allowance.

Property and Equipment

Property and Equipment

Property and equipment are recorded at cost. Depreciation is calculated principally on the straight-line method over the estimated useful lives of the assets which range from three to forty years. Leasehold improvements paid for by the Company as a lessee are amortized over the lesser of the useful life or remaining lease terms.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

1) Significant Accounting Policies (Continued)

Long-lived Assets

Long-lived assets to be held and used, including property and equipment and real estate held for investment, are reviewed for impairment whenever events or changes in circumstances indicate that the related carrying amount may not be recoverable. When required, impairment losses on assets to be held and used are recognized based on the fair value of the asset, and long-lived assets to be disposed of are reported at the lower of carrying amount or fair value less costs to sell. No impairment of long-lived assets has been recognized in the accompanying financial statements except for certain impairments of real estate held for investment as disclosed in Note 2.

Derivative Instruments

Derivative Instruments

Mortgage Banking Derivatives

Loan Commitments

The Company is exposed to price risk due to the potential impact of changes in interest rates on the values of loan commitments from the time a loan commitment is made to an applicant to the time the loan that would result from the exercise of that loan commitment is funded. Managing price risk is complicated by the fact that the ultimate percentage of loan commitments that will be exercised (i.e., the number of loans that will be funded) fluctuates. The probability that a loan will not be funded or the loan application is denied or withdrawn within the terms of the commitment is driven by a number of factors, particularly the change, if any, in mortgage rates following the issuance of the loan commitment.

In general, the probability of funding increases if mortgage rates rise and decreases if mortgage rates fall. This is due primarily to the relative attractiveness of current mortgage rates compared to the applicant’s committed rate. The probability that a loan will not be funded within the terms of the mortgage loan commitment also is influenced by the source of the applications (retail, broker or correspondent channels), proximity to rate lock expiration, purpose for the loan (purchase or refinance), product type and the application approval status. The Company has developed fallout estimates using historical data that take into account all of the variables, as well as renegotiations of rate and point commitments that tend to occur when mortgage rates fall. These fallout estimates are used to estimate the number of loans that the Company expects to be funded within the terms of the loan commitments and are updated periodically to reflect the most current data.

The Company estimates the fair value of a loan commitment based on the change in estimated fair value of the underlying mortgage loan, quoted mortgage-backed securities (“MBS”) prices, estimates of the fair value of mortgage servicing rights, and an estimate of the probability that the mortgage loan will fund within the terms of the commitment. The change in fair value of the underlying mortgage loan is measured from the date the loan commitment is issued and is shown net of expenses. Following issuance, the value of a loan commitment can be either positive or negative depending upon the change in value of the underlying mortgage loans.

Forward Sale Commitments

The Company utilizes forward commitments to economically hedge the price risk associated with its outstanding mortgage loan commitments. A forward commitment protects the Company from losses on sales of the loans arising from exercise of the loan commitments. Management expects these types of commitments will experience changes in fair value opposite to changes in fair value of the loan commitments, thereby reducing earnings volatility related to the recognition in earnings of changes in the values of the commitments.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

1) Significant Accounting Policies (Continued)

The net changes in fair value of loan commitments and forward sale commitments are shown in current earnings as a component of mortgage fee income on the consolidated statements of earnings. Mortgage banking derivatives are shown in other assets and other liabilities and accrued expenses on the consolidated balance sheets.

Call and Put Option Derivatives

The Company uses a strategy of selling “out of the money” call options on its equity securities as a source of revenue. The options give the purchaser the right to buy from the Company specified equity securities at a set price up to a pre-determined date in the future. The Company uses the strategy of selling put options as a means of generating cash or purchasing equity securities at lower than current market prices. The Company receives an immediate payment of cash for the value of the option and establishes a liability for the fair value of the option. The liability for options is adjusted to fair value at each reporting date. In the event a call option is exercised, the Company sells the equity security at a favorable price enhanced by the value of the option that was sold. If the option expires unexercised, the Company recognizes a gain from the expired option. In the event a put option is exercised, the Company acquires an equity security at the strike price of the option reduced by the value received from the sale of the put option. The equity security is then treated as a normal equity security in the Company’s portfolio. The net changes in the fair value of call and put options are shown in current earnings as a component of gains (losses) on investments and other assets. Call and put options are shown in other liabilities and accrued expenses on the consolidated balance sheets.

Allowance for Doubtful Accounts and Loan Losses and Impaired Loans

Allowance for Doubtful Accounts and Loan Losses and Impaired Loans

The Company records an allowance and recognizes an expense for potential losses from mortgage loans held for investment, other investments and receivables in accordance with GAAP.

Receivables are the result of cemetery and mortuary operations, mortgage loan operations and life insurance operations. The allowance is based upon the Company’s historical experience for collectively evaluated impairment. Other allowances are based upon receivables individually evaluated for impairment. Collectability of the cemetery and mortuary receivables is significantly influenced by current economic conditions. The critical issues that impact recovery of mortgage loan operations are interest rate risk, loan underwriting, new regulations and the overall economy.

The Company provides for losses on its mortgage loans held for investment through an allowance for loan losses (a contra-asset account). The allowance is comprised of two components. The first component is an allowance for collectively evaluated impairment that is based upon the Company’s historical experience in collecting similar receivables. The second component is based upon individual evaluation of loans that are determined to be impaired. As a practical expedient, upon determining impairment, the Company establishes an individual impairment allowance based upon an assessment of the fair value of the underlying collateral. See the schedules in Note 2 for additional information. In addition, when a mortgage loan is past due more than 90 days, the Company does not accrue any interest income. When a loan becomes delinquent, the Company proceeds to foreclose on the real estate and all expenses for foreclosure are expensed as incurred. Once foreclosed, an adjustment for the lower of cost or fair value is made, if necessary, and the amount is classified as real estate held for investment. The Company will rent the properties until it is deemed desirable to sell them.

The allowance for losses on mortgage loans held for investment could change based on changes in the value of the underlying collateral, the performance status of the loans, or the Company’s actual collection experience. The actual losses could change, in the near term, from the established allowance, based upon the occurrence or non-occurrence of these events.

For purposes of determining the allowance for losses, the Company has segmented its mortgage loans held for investment by loan type. The Company’s loan types are commercial, residential, and residential construction. The inherent risks within the portfolio vary depending upon the loan type as follows:

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

1) Significant Accounting Policies (Continued)

Commercial — Underwritten in accordance with the Company’s policies to determine the borrower’s ability to repay the obligation as agreed. Commercial loans are made primarily based on the underlying collateral supporting the loan. Accordingly, the repayment of a commercial loan depends primarily on the collateral and its ability to generate income and secondary on the borrower’s (or guarantors) ability to repay.

Residential — Secured by family dwelling units. These loans are secured by first and second mortgages on the unit. The borrower’s ability to repay is sensitive to the life events and general economic condition of the region. Where loan to values exceed 80%, the loan is generally guaranteed by private mortgage insurance, FHA or VA.

Residential construction (including land acquisition and development) — Underwritten in accordance with the Company’s underwriting policies which include a financial analysis of the builders, borrowers (guarantors), construction cost estimates, and independent appraisal valuations. These loans will rely on the value associated with the project upon completion. These cost and valuation estimates may be inaccurate. Construction loans generally involve the disbursement of substantial funds over a short period of time with repayment substantially dependent upon the success of the completed project and the ability of the borrower to secure long-term financing. Additionally, land is underwritten according to the Company’s policies, which include independent appraisal valuations as well as the estimated value associated with the land upon completion of development into finished lots. These cost and valuation estimates may be inaccurate. These loans are considered to be of a higher risk than other mortgage loans due to their ultimate repayment being sensitive to general economic conditions, availability of long-term or construction financing, and interest rate sensitivity.

Future Policy Benefits and Unpaid Claims

Future policy benefit reserves for traditional life insurance are computed using a net level method, including assumptions as to investment yields, mortality, morbidity, withdrawals, and other assumptions based on the life insurance subsidiaries’ experience, modified as necessary to give effect to anticipated trends and to include provisions for possible unfavorable deviations. Such liabilities are, for some plans, graded to equal statutory values or cash values at or prior to maturity, which are deemed a reasonable equivalent for GAAP. The range of assumed interest rates for all traditional life insurance policy reserves was 4% to 10%. Benefit reserves for traditional limited-payment life insurance policies include the deferred portion of the premiums received during the premium-paying period. Deferred premiums are recognized as income over the life of the policies. Policy benefit claims are charged to expense in the period the claims are incurred. Increases in future policy benefits are charged to expense.

Future policy benefit reserves for interest-sensitive insurance products are computed under a retrospective deposit method and represent policy account balances before applicable surrender charges. Policy benefits and claims that are charged to expense include benefit claims incurred in the period in excess of related policy account balances. Interest crediting rates for interest-sensitive insurance products ranged from 3% to 6.5%.

The Company records an unpaid claims liability for claims in the course of settlement equal to the death benefit amount less any reinsurance recoverable amount for claims reported. There is also an unpaid claims liability for claims incurred but not reported. This liability is based on the historical experience of the net amount of claims that were reported in reporting periods subsequent to the reporting period when claims were incurred.

Participating Insurance

Participating Insurance

Participating business constituted 2% of insurance in force for the years ended 2021 and 2020. The provision for policyholders’ dividends included in policyholder obligations is based on dividend scales anticipated by management. Amounts to be paid are determined by the Board of Directors.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

1) Significant Accounting Policies (Continued)

Recognition of Insurance Premiums and Other Considerations

Recognition of Insurance Premiums and Other Considerations

Premiums and other consideration for traditional life insurance products (which include those products with fixed and guaranteed premiums and benefits and consist principally of whole life insurance policies, limited payment life insurance policies, and certain annuities with life contingencies) are recognized as revenues when due from policyholders. Premiums and other consideration for interest-sensitive insurance policies (which include universal life policies, interest-sensitive life policies, deferred annuities, and annuities without life contingencies) are recognized when earned and consist of amounts assessed against policyholder account balances during the period for policy administration charges and surrender charges.

Reinsurance

Reinsurance

The Company follows the procedure of reinsuring risks in excess of $100,000 to provide for greater diversification of business to allow management to control exposure to potential losses arising from large risks, and provide additional capacity for growth. The Company remains liable for amounts ceded in the event the reinsurers are unable to meet their obligations.

The Company entered into coinsurance agreements with unaffiliated insurance companies under which the Company assumed 100% of the risk for certain life insurance policies and certain other policy-related liabilities of the insurance company.

Reinsurance premiums, commissions, expense reimbursements, and reserves related to reinsured business are accounted for on a basis consistent with those used in accounting for the original policies issued and the terms of the reinsurance contracts. Expense allowances received in connection with reinsurance ceded are accounted for as a reduction of the related policy acquisition costs and are deferred and amortized accordingly.

Pre-need Sales and Costs

Pre-need Sales and Costs

Pre-need contract sales of funeral services and caskets - revenue and costs associated with the sales of pre-need funeral services and caskets are deferred until the performance obligations are fulfilled (services are performed or the caskets are delivered).

Sales of cemetery interment rights (cemetery burial property) - revenue and costs associated with the sale of cemetery interment rights are deferred until 10% of the sales price has been collected.

Pre-need contract sales of cemetery merchandise (primarily markers and vaults) - revenue and costs associated with the sale of pre-need cemetery merchandise is deferred until the merchandise is delivered to the Company.

Pre-need contract sales of cemetery services (primarily merchandise delivery, installation fees and burial opening and closing fees) - revenue and costs associated with the sales of pre-need cemetery services are deferred until the services are performed.

Prearranged funeral and pre-need cemetery customer acquisition costs - costs incurred related to obtaining new pre-need contract cemetery and prearranged funeral services, which include only costs that vary with and are primarily related to the acquisition of new pre-need cemetery and prearranged funeral services, are deferred until the merchandise is delivered or services are performed.

Revenues and costs for at-need sales are recorded when a valid contract exists, the services are performed, collection is reasonably assured and there are no significant performance obligations remaining.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

1) Significant Accounting Policies (Continued)

The Company, through its cemetery and mortuary operations, provides guaranteed funeral arrangements wherein a prospective customer can receive future goods and services at guaranteed prices. To accomplish this, the Company, through its life insurance operations, sells to the customer an increasing benefit life insurance policy that is assigned to the mortuaries. If, at the time of need, the policyholder/potential mortuary customer utilizes one of the Company’s facilities, the guaranteed funeral arrangement contract that has been assigned will provide the funeral goods and services at the contracted price. The increasing life insurance policy will cover the difference between the original contract prices and current prices. Risks may arise if the difference cannot be fully met by the life insurance policy. However, management believes that given current inflation rates and related price increases of goods and services, the risk of exposure is minimal.

Goodwill

Goodwill

Previous acquisitions have been accounted for as purchases under which assets acquired and liabilities assumed were recorded at their fair values with the excess purchase price recognized as goodwill. The Company evaluates annually or when changes in circumstances warrant the recoverability of goodwill and if there is a decrease in value, the related impairment is recognized as a charge against income. No impairment of goodwill has been recognized in the accompanying financial statements.

Other Intangibles

Other Intangibles

Other intangibles are recognized apart from goodwill whenever an acquired intangible asset arises from contractual or other legal rights, or whenever it is capable of being separated or divided from the acquired entity and sold, transferred, licensed, rented, or exchanged, either individually or in combination with a related contract, asset, or liability. The Company engages a third-party valuation firm to analyze the value of the intangible assets that result from significant acquisitions. The value of the intangible assets that result from these acquisitions are included in Other Assets and are determined using the income approach, relying on a relief from the royalty method.

Income Taxes

Income Taxes

Income taxes include taxes currently payable plus deferred taxes. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to the temporary differences in the financial reporting basis and tax basis of assets and liabilities and operating loss carry-forwards. Deferred tax assets are measured using enacted tax rates expected to apply to taxable income in the years in which these temporary differences are expected to be recovered or settled.

Liabilities are established for uncertain tax positions expected to be taken in income tax returns when such positions are judged to meet the “more-likely-than-not” threshold based on the technical merits of the positions. Estimated interest and penalties related to uncertain tax penalties are included as a component of income tax expense.

Earnings Per Common Share

Earnings Per Common Share

The Company computes earnings per share which requires presentation of basic and diluted earnings per share. Basic earnings per equivalent Class A common share are computed by dividing net earnings by the weighted-average number of Class A common shares outstanding during each year presented, after the effect of the assumed conversion of Class C common stock to Class A common stock. Diluted earnings per share is computed by dividing net earnings by the weighted-average number of common shares outstanding during the year used to compute basic earnings per share plus dilutive potential incremental shares. Basic and diluted earnings per share amounts have been adjusted retroactively for the effect of annual stock dividends.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

1) Significant Accounting Policies (Continued)

Stock Based Compensation

Stock Based Compensation

The cost of employee services received in exchange for an award of equity instruments is recognized in the financial statements and is measured based on the fair value on the grant date of the award. The fair value of stock options is calculated using the Black Scholes Option Pricing Model. Stock option compensation expense is recognized over the period during which an employee is required to provide service in exchange for the award and is included in personnel expenses on the consolidated statements of earnings.

Concentration of Credit Risk

For a description of the concentration risk regarding available for sale debt securities, mortgage loans held for investment and real estate held for investment, refer to Note 2 of the Notes to Consolidated Financial Statements.

Advertising

Advertising

The Company expenses advertising costs as incurred.

Recent Accounting Pronouncements

Recent Accounting Pronouncements

Accounting Standards Issued But Not Yet Adopted

ASU No. 2016-13: “Financial Instruments – Credit Losses (Topic 326)” — Issued in September 2016, ASU 2016-13 amends guidance on reporting credit losses for assets held at amortized cost basis (such as mortgage loans and held to maturity debt securities) and available for sale debt securities. For assets held at amortized cost basis, Topic 326 eliminates the probable initial recognition threshold in current GAAP and, instead, requires an entity to reflect its current estimate of all expected credit losses. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial assets to present the net amount expected to be collected. For available for sale debt securities, credit losses should be measured in a manner similar to current GAAP; however, Topic 326 will require that credit losses be presented as an allowance rather than as a write-down. In October 2019, the FASB proposed an update to ASU No. 2016-13 that would make the ASU effective for the Company on January 1, 2023. The Company is in the process of evaluating the potential impact of this standard.

ASU No. 2018-12: “Financial Services – Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts” — Issued in August 2018, ASU 2018-12 is intended to improve the timeliness of recognizing changes in the liability for future policy benefits on traditional long-duration contracts by requiring that assumptions be updated after contract inception and by modifying the rate used to discount future cash flows. The ASU will improve the accounting for certain market-based options or guarantees associated with deposit or account balance contracts, simplify amortization of deferred acquisition costs while improving and expanding required disclosures. In November 2020, the FASB issued an update to ASU No. 2018-12 that made the ASU effective for the Company on January 1, 2025. The Company has made progress in the implementation of the new standard, including the involvement of actuaries, accountants, and systems specialists. However, the Company has not yet estimated the impact the new guidance will have on the consolidated financial statements.

The Company has reviewed other recent accounting pronouncements and has determined that they will not significantly impact the Company’s results of operations or financial position.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

Accumulated Other Comprehensive Income

12 Months Ended

Dec. 31, 2021

Equity [Abstract]

Accumulated Other Comprehensive Income

18) Accumulated Other Comprehensive Income

The following summarizes the changes in accumulated other comprehensive income:

	2021			2020
	December 31
	2021			2020

Unrealized gains on fixed maturity securities available for sale	$	(7,323,241	)	$	12,016,464
Amounts reclassified into net earnings		805,510			(2,772	)
Net unrealized gains before taxes		(6,517,731	)		12,013,692
Tax expense		1,368,721			(2,522,876	)
Net		(5,149,010	)		9,490,816
Unrealized gains on restricted assets (1)		(23,250	)		41,225
Tax expense		5,792			(10,269	)
Net		(17,458	)		30,956
Unrealized gains on cemetery perpetual care trust investments (1)		(11,114	)		(6,817	)
Tax expense		2,769			1,698
Net		(8,345	)		(5,119	)
Unrealized gains for foreign currency translations adjustments		2,835			(46	)
Tax expense		(707	)		12
Net		2,128			(34	)
Other comprehensive income changes	$	(5,172,685	)	$	9,516,619

(1)	Fixed maturity securities available for sale

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

18) Accumulated Other Comprehensive Income (Continued)

The following is the accumulated balances of other comprehensive income as of December 31, 2021:

	Beginning Balance December 31, 2020			Change for the period			Ending Balance December 31, 2021
Unrealized gains (losses) on fixed maturity securities available for sale	$	23,170,275		$	(5,149,010	)	$	18,021,265
Unrealized gains (losses) on restricted assets (1)		57,650			(17,458	)		40,192
Unrealized gains (losses) on cemetery perpetual care trust investments (1)		17,336			(8,345	)		8,991
Foreign currency translation adjustments		(2,128	)		2,128			-
Other comprehensive income	$	23,243,133		$	(5,172,685	)	$	18,070,448

(1) Fixed maturity securities available for sale

The following is the accumulated balances of other comprehensive income as of December 31, 2020:

	Beginning Balance December 31, 2019			Change for the period			Ending Balance December 31, 2020
Unrealized gains on fixed maturity securities available for sale	$	13,679,459		$	9,490,816		$	23,170,275
Unrealized gains on restricted assets (1)		26,694			30,956			57,650
Unrealized gains (losses) on cemetery perpetual care trust investments (1)		22,455			(5,119	)		17,336
Foreign currency translation adjustments		(2,094	)		(34	)		(2,128	)
Other comprehensive income	$	13,726,514		$	9,516,619		$	23,243,133

(1)	Fixed maturity securities available for sale

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

Estimated Fair Values of Assets Acquired and Liabilities Assumed (Details) - Holbrook Mortuary [Member]

12 Months Ended

Dec. 31, 2021

USD ($)

Business Acquisition [Line Items]

Property and equipment (1)

$ 2,641,210

^[1]

Goodwill

395,432

Other

15,105

Total assets acquired

3,051,747

Fair value of net assets acquired/consideration paid

$ 3,051,747

[1]	At estimated fair value which is a Level 3 asset in the fair value hierarchy

Business Segment Information (Tables)

12 Months Ended

Dec. 31, 2021

Segment Reporting [Abstract]

Schedule of Revenues and Expenses by Reportable Segment

	Year Ended December 31, 2021
	Life			Cemetery/						Intercompany
	Insurance			Mortuary			Mortgage			Eliminations			Consolidated
Revenues:
From external sources:
Revenue from customers	$	100,254,573		$	23,997,313		$	263,418,230			-		$	387,670,116
Net investment income		56,091,725			1,653,940			519,018			-			58,264,683
Gains on investments and other assets		4,554,528			1,511,965			198,641			-			6,265,134
Other than temporary impairments		(39,502	)		-			-			-			(39,502	)
Other revenues		2,152,531			100,255			16,282,325			-			18,535,111
Intersegment revenues:
Net investment income		7,569,875			314,001			599,115			(8,482,991	)		-
Total revenues		170,583,730			27,577,474			281,017,329			(8,482,991	)		470,695,542
Expenses:
Death, surrenders and other policy benefits		67,218,455			-			-			-			67,218,455
Increase in future policy benefits		26,263,312			-			-			-			26,263,312
Amortization of deferred policy and pre-need acquisition costs and value of business acquired		15,611,374			531,596			-			-			16,142,970
Selling, general and administrative expenses:
Commissions		3,514,498			1,917,899			112,854,072			-			118,286,469
Personnel		25,009,096			6,850,617			68,880,448			-			100,740,161
Advertising		1,160,640			570,924			4,894,854			-			6,626,418
Rent and rent related		733,726			109,318			6,399,243			-			7,242,287
Depreciation on property and equipment		806,543			479,005			650,065			-			1,935,613
Provision for loan loss reserve		-			-			-			-			-
Cost related to funding mortgage loans		-			-			10,541,570			-			10,541,570
Intersegment		497,113			113,062			671,107			(1,281,282	)		-
Other		12,075,374			5,224,178			35,766,430			-			53,065,982
Interest expense:
Intersegment		392,003			97,195			6,712,511			(7,201,709	)		-
Other		2,328,868			54,620			4,744,028			-			7,127,516
Costs of goods and services sold-mortuaries and cemeteries		-			3,704,014			-			-			3,704,014
Total benefits and expenses		155,611,002			19,652,428			252,114,328			(8,482,991	)		418,894,767
Earnings before income taxes	$	14,972,728		$	7,925,046		$	28,903,001		$	-		$	51,800,775
Income tax benefit (expense)		(2,943,715	)		(1,975,787	)		(7,362,283	)		-			(12,281,785	)
Net earnings	$	12,029,013		$	5,949,259		$	21,540,718		$	-		$	39,518,990

Identifiable assets	$	1,236,406,557		$	73,432,116		$	328,600,841		$	(96,099,992	)	$	1,542,339,522

Goodwill	$	2,765,570		$	2,488,213		$	-		$	-		$	5,253,783

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

15) Business Segment Information (Continued)

	Year Ended December 31, 2020
	Life			Cemetery/						Intercompany
	Insurance			Mortuary			Mortgage			Eliminations			Consolidated
Revenues:
From external sources:
Revenue from customers	$	93,020,617		$	20,307,435		$	298,933,110		$	-		$	412,261,162
Net investment income		54,811,486			807,695			710,622			-			56,329,803
Gains on investments and other assets		2,088,541			(162,652	)		(39	)		-			1,925,850
Other than temporary impairments		(370,975	)		-			-			-			(370,975	)
Other revenues		1,491,585			94,349			9,731,548			-			11,317,482
Intersegment revenues:
Net investment income		8,022,503			351,505			716,240			(9,090,248	)		-
Total revenues		159,063,757			21,398,332			310,091,481			(9,090,248	)		481,463,322
Expenses:
Death, surrenders and other policy benefits		62,841,360			-			-			-			62,841,360
Increase in future policy benefits		23,568,650			-			-			-			23,568,650
Amortization of deferred policy and pre-need acquisition costs and value of business acquired		13,618,204			689,221			-			-			14,307,425
Selling, general and administrative expenses:
Commissions		4,149,241			1,506,320			118,770,736			-			124,426,297
Personnel		25,449,100			5,669,367			53,871,504			-			84,989,971
Advertising		614,114			391,836			4,374,946			-			5,380,896
Rent and rent related		861,602			89,253			5,922,706			-			6,873,561
Depreciation on property and equipment		843,335			488,570			746,833			-			2,078,738
Provision for loan loss reserve		-			-			16,506,030			-			16,506,030
Cost related to funding mortgage loans		-			-			9,877,700			-			9,877,700
Intersegment		621,161			142,999			580,976			(1,345,136	)		-
Other		11,808,818			4,417,805			31,104,479			-			47,331,102
Interest expense:
Intersegment		410,024			152,175			7,182,913			(7,745,112	)		-
Other		2,354,760			198,968			6,025,082			-			8,578,810
Costs of goods and services sold-mortuaries and cemeteries		-			3,252,655			-			-			3,252,655
Total benefits and expenses		147,140,369			16,999,169			254,963,905			(9,090,248	)		410,013,195
Earnings before income taxes	$	11,923,388		$	4,399,163		$	55,127,576		$	-		$	71,450,127
Income tax benefit (expense)		(1,433,901	)		(1,009,137	)		(13,410,476	)		-			(15,853,514	)
Net earnings	$	10,489,487		$	3,390,026		$	41,717,100		$	-		$	55,596,613

Identifiable assets	$	1,171,158,235		$	56,335,498		$	408,325,196		$	(90,398,039	)	$	1,545,420,890

Goodwill	$	2,765,570		$	754,018		$	-		$	-		$	3,519,588

Derivative Instruments (Tables)

12 Months Ended

Dec. 31, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Derivative Assets at Fair Value

The following table shows the fair value and notional amounts of derivative instruments.

		December 31, 2021						December 31, 2020
	Balance Sheet Location	Notional Amount		Asset Fair Value		Liability Fair Value		Notional Amount		Asset Fair Value		Liability Fair Value
Derivatives not designated as hedging instruments:
Loan commitments	Other assets and Other liabilities	$	862,568,967	$	8,563,410	$	1,547,895	$	659,245,038	$	12,592,672	$	2,464,062
Call options	Other liabilities		982,500		—		50,936		1,873,200		—		43,097
Put options	Other liabilities		362,900		—		4,493		—		—		—
Total		$	863,914,367	$	8,563,410	$	1,603,324	$	661,118,238	$	12,592,672	$	2,507,159

Schedule of Gains and Losses on Derivatives

		Years ended December 31
Derivative	Classification	2021			2020
Loan commitments	Mortgage fee income	$	(3,113,095	)	$	7,637,377

Call and put options	Gains on investments and other assets	$	160,410		$	272,758

Revenues from Contracts with Customers (Tables)

12 Months Ended

Dec. 31, 2021

Revenue from Contract with Customer [Abstract]

Schedule of Opening and Closing Balances of Receivables, Contract Assets and Contract Liabilities

The opening and closing balances of the Company’s receivables, contract assets and contract liabilities are as follows:

	Contract Balances
	Receivables (1)		Contract Asset		Contract Liability
Opening (1/1/2021)	$	4,119,988	$	-	$	13,080,179
Closing (12/31/2021)		5,298,636		-		14,508,022
Increase/(decrease)		1,178,648		-		1,427,843

	Contract Balances
	Receivables (1)		Contract Asset		Contract Liability
Opening (1/1/2020)	$	2,778,879	$	-	$	12,607,978
Closing (12/31/2020)		4,119,988		-		13,080,179
Increase/(decrease)		1,341,109		-		472,201

(1) Included in Receivables, net on the consolidated balance sheets

Schedule of Opening and Closing Balances of the Assets and Liabilities

The following table disaggregates the opening and closing balances of the Company’s contract balances.

	Contract Balances
	Contract Asset		Contract Liability
Pre-need merchandise and services	$	-	$	12,545,753
At-need specialty merchandise		-		534,426
Pre-need land sales		-		-
Opening (1/1/2021)	$	-	$	13,080,179

Pre-need merchandise and services	$	-	$	13,722,348
At-need specialty merchandise		-		785,674
Pre-need land sales		-		-
Closing (12/31/2021)	$	-	$	14,508,022

	Contract Balances
	Contract Asset		Contract Liability
Pre-need merchandise and services	$	-	$	12,325,437
At-need specialty merchandise		-		282,541
Pre-need land sales		-		-
Opening (1/1/2020)	$	-	$	12,607,978

Pre-need merchandise and services	$	-	$	12,545,753
At-need specialty merchandise		-		534,426
Pre-need land sales		-		-
Closing (12/31/2020)	$	-	$	13,080,179

Revenues of the Cemetery and Mortuary Contracts

The following table disaggregates revenue for the Company’s cemetery and mortuary contracts.

	Years Ended December 31
	2021		2020
Major goods/service lines
At-need	$	16,220,541	$	15,212,822
Pre-need		7,776,772		5,094,613
	$	23,997,313	$	20,307,435

Timing of Revenue Recognition
Goods transferred at a point in time	$	16,793,439	$	13,438,592
Services transferred at a point in time		7,203,874		6,868,843
	$	23,997,313	$	20,307,435

Reconciliation of Revenues from Cemetery and mortuary contracts to Business Segment Information

The following table disaggregates contract costs that are included in deferred policy and pre-need contract acquisition costs on the consolidated balances sheets.

	2021		2020
	Years Ended December 31
	2021		2020
Pre-need merchandise and services	$	3,688,579	$	3,601,638
At-need specialty merchandise		29,688		5,302
Pre-need land sales		-		-
	$	3,718,267	$	3,606,940

Revenues from Contracts with Customers

12 Months Ended

Dec. 31, 2021

Revenue from Contract with Customer [Abstract]

Revenues from Contracts with Customers

23) Revenues from Contracts with Customers

The Company reports revenues from contracts with customers pursuant to ASC No. 606, Revenue from Contracts with Customers.

Contracts with Customers

Information about Performance Obligations and Contract Balances

The Company’s cemetery and mortuary segment sells a variety of goods and services to customers in both at-need and pre-need situations. Due to the timing of the fulfillment of the obligation, revenue is deferred until that obligation is fulfilled. The total contract liability for future obligations is included in deferred pre-need cemetery and mortuary contract revenues on the consolidated balance sheets and, as of December 31, 2021 and 2020, the balances were $14,508,022 and $13,080,179, respectively.

The Company’s three types of future obligations are as follows:

Pre-need Merchandise and Service Revenue: All pre-need merchandise and service revenue is deferred and the funds are placed in trust until the need arises, the merchandise is received or the service is performed. The trust is then relieved, and the revenue and commissions are recognized. As of December 31, 2021 and 2020, the balances were $13,722,348 and $12,545,753, respectively.

At-need Specialty Merchandise Revenue: At-need specialty merchandise revenue consists of customizable merchandise ordered from a manufacturer such as markers and bases. When specialty merchandise is ordered, it can take time to manufacture and deliver the product. Revenue is deferred until the at-need merchandise is received. As of December 31, 2021 and 2020, the balances were $785,674 and $534,426, respectively. Deferred revenue for at-need specialty revenue is not placed in trust.

Deferred Pre-need Land Revenue: Deferred pre-need revenue and corresponding commissions are deferred until 10% of the funds are received from the customer through regular monthly payments. As of December 31, 2021 and 2020, the balances were $-0- and $-0-, respectively. Deferred pre-need land revenue is not placed in trust.

Complete payment of the contract does not constitute fulfillment of the performance obligation. Goods or services are deferred until such time the service is performed or merchandise is received. Pre-need contracts are required to be paid in full prior to a customer using a good or service from a pre-need contract. Goods and services from pre-need contracts can be transferred when paid in full from one owner to another. In such cases, the Company will act as an agent in transferring the requested goods and services. A transfer of goods and services does not fulfill an obligation and revenue remains deferred.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

23) Revenues from Contracts with Customers (Continued)

The opening and closing balances of the Company’s receivables, contract assets and contract liabilities are as follows:

	Contract Balances
	Receivables (1)		Contract Asset		Contract Liability
Opening (1/1/2021)	$	4,119,988	$	-	$	13,080,179
Closing (12/31/2021)		5,298,636		-		14,508,022
Increase/(decrease)		1,178,648		-		1,427,843

	Contract Balances
	Receivables (1)		Contract Asset		Contract Liability
Opening (1/1/2020)	$	2,778,879	$	-	$	12,607,978
Closing (12/31/2020)		4,119,988		-		13,080,179
Increase/(decrease)		1,341,109		-		472,201

(1) Included in Receivables, net on the consolidated balance sheets

The following table disaggregates the opening and closing balances of the Company’s contract balances.

	Contract Balances
	Contract Asset		Contract Liability
Pre-need merchandise and services	$	-	$	12,545,753
At-need specialty merchandise		-		534,426
Pre-need land sales		-		-
Opening (1/1/2021)	$	-	$	13,080,179

Pre-need merchandise and services	$	-	$	13,722,348
At-need specialty merchandise		-		785,674
Pre-need land sales		-		-
Closing (12/31/2021)	$	-	$	14,508,022

	Contract Balances
	Contract Asset		Contract Liability
Pre-need merchandise and services	$	-	$	12,325,437
At-need specialty merchandise		-		282,541
Pre-need land sales		-		-
Opening (1/1/2020)	$	-	$	12,607,978

Pre-need merchandise and services	$	-	$	12,545,753
At-need specialty merchandise		-		534,426
Pre-need land sales		-		-
Closing (12/31/2020)	$	-	$	13,080,179

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

23) Revenues from Contracts with Customers (Continued)

The amount of revenue recognized for the years ended December 31, 2021 and 2020 that was included in the opening contract liability balance was $4,528,646 and $4,359,709, respectively.

The difference between the opening and closing balances of the Company’s contract assets and contract liabilities primarily results from the timing difference between the Company’s performance and the customer’s payment.

Disaggregation of Revenue

The following table disaggregates revenue for the Company’s cemetery and mortuary contracts.

	Years Ended December 31
	2021		2020
Major goods/service lines
At-need	$	16,220,541	$	15,212,822
Pre-need		7,776,772		5,094,613
	$	23,997,313	$	20,307,435

Timing of Revenue Recognition
Goods transferred at a point in time	$	16,793,439	$	13,438,592
Services transferred at a point in time		7,203,874		6,868,843
	$	23,997,313	$	20,307,435

Significant Judgments and Estimates

The Company’s cemetery and mortuary segment recognizes revenue on future performance obligations when goods are delivered and when services are performed and is not determined by the terms or payments of the contract as long as any good or service is paid in full prior to delivery. Prices are determined based on the market at the time a contract is created. Goods or services are not partially completed. There are no significant judgements, estimations or allocation methods when revenue should be recognized.

Practical Expedients

The Company has not elected to use any of the practical expedients under ASC 606.

Contract Costs

The Company’s cemetery and mortuary segment defers certain costs associated with obtaining a contract on future obligations.

Pre-need Merchandise and Service Revenue: Pre-need merchandise and service revenues are deferred until the goods or services are delivered. Recognition can be years until the obligations are satisfied. Commissions and other costs are capitalized and deferred until the obligation is satisfied. Other costs include rent on pre-need offices and training rooms, and call center costs. Costs that are allocated based on a percentage include family service advisor compensation, bonuses, utilities and supplies that are all used to procure a pre-need sale.

At-need Specialty Merchandise Revenue: At-need specialty merchandise is ordered from a third-party manufacturer. Generally, at-need specialty merchandise is ordered and received within 90 days of order. These orders are also short-term in nature and are deferred until the product is received from the manufacturer and the obligation is satisfied.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

23) Revenues from Contracts with Customers (Continued)

Deferred Pre-need Land Revenue: Revenue is recognized on pre-need land sales when the customer has paid at least 10% toward the land price. In cases, where customers pay less than 10%, the revenue and associated commissions are deferred until such time when 10% of the contract price is received.

The following table disaggregates contract costs that are included in deferred policy and pre-need contract acquisition costs on the consolidated balances sheets.

	2021		2020
	Years Ended December 31
	2021		2020
Pre-need merchandise and services	$	3,688,579	$	3,601,638
At-need specialty merchandise		29,688		5,302
Pre-need land sales		-		-
	$	3,718,267	$	3,606,940

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-URI http://asc.fasb.org/topic&trid=49130388

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 10
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130551-203045

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (b)(2)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130556-203045

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
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Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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+ Details

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense, Mortgage Servicing Rights (Details) - USD ($)	Dec. 31, 2021	Dec. 31, 2020
Impairment Effects on Earnings Per Share [Line Items]
Total	$ 3,512,667	$ 1,302,666
Mortgage Servicing Rights [Member]
Impairment Effects on Earnings Per Share [Line Items]
2022	7,341,097
2023	6,020,240
2024	5,263,053
2025	4,583,231
2026	4,008,838
Thereafter	25,843,996
Total	$ 53,060,455

Schedule of Revenues and Expenses by Reportable Segment (Details) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Segment Reporting Information [Line Items]
Gains on investments and other assets	$ 6,265,134	$ 1,925,850
Other revenues	18,535,111	11,317,482
Net investment income	58,264,683	56,329,803
Total revenues	470,695,542	481,463,322
Commissions	118,286,469	124,426,297
Advertising	6,626,418	5,380,896
Rent and rent related	7,242,287	6,873,561
Costs related to funding mortgage loans	10,541,570	9,877,700
Cost of goods and services sold - cemeteries and mortuaries	3,704,014	3,252,655
Earnings before income taxes	51,800,775	71,450,127
Income tax benefit (expense)	12,281,785	15,853,514
Net Earnings (Loss)	39,518,990	55,596,613
Goodwill	5,253,783	3,519,588	$ 3,519,588
Life Insurance Segments [Member]
Segment Reporting Information [Line Items]
Revenue from customers	100,254,573	93,020,617
Net investment income	56,091,725	54,811,486
Gains on investments and other assets	4,554,528	2,088,541
Other than temporary impairments	(39,502)	(370,975)
Other revenues	2,152,531	1,491,585
Net investment income	7,569,875	8,022,503
Total revenues	170,583,730	159,063,757
Death, surrenders and other policy benefits	67,218,455	62,841,360
Increase in future policy benefits	26,263,312	23,568,650
Amortization of deferred policy and pre-need acquisition costs and value of business acquired	15,611,374	13,618,204
Commissions	3,514,498	4,149,241
Personnel	25,009,096	25,449,100
Advertising	1,160,640	614,114
Rent and rent related	733,726	861,602
Depreciation on property and equipment	806,543	843,335
Provision for loan loss reserve
Costs related to funding mortgage loans
Intersegment	497,113	621,161
Other	12,075,374	11,808,818
Intersegment	392,003	410,024
Other	2,328,868	2,354,760
Cost of goods and services sold - cemeteries and mortuaries
Total benefits and expenses	155,611,002	147,140,369
Earnings before income taxes	14,972,728	11,923,388
Income tax benefit (expense)	(2,943,715)	(1,433,901)
Net Earnings (Loss)	12,029,013	10,489,487
Identifiable Assets	1,236,406,557	1,171,158,235
Goodwill	2,765,570	2,765,570
Cemetery and Mortuary [Member]
Segment Reporting Information [Line Items]
Revenue from customers	23,997,313	20,307,435
Net investment income	1,653,940	807,695
Gains on investments and other assets	1,511,965	(162,652)
Other than temporary impairments
Other revenues	100,255	94,349
Net investment income	314,001	351,505
Total revenues	27,577,474	21,398,332
Death, surrenders and other policy benefits
Increase in future policy benefits
Amortization of deferred policy and pre-need acquisition costs and value of business acquired	531,596	689,221
Commissions	1,917,899	1,506,320
Personnel	6,850,617	5,669,367
Advertising	570,924	391,836
Rent and rent related	109,318	89,253
Depreciation on property and equipment	479,005	488,570
Provision for loan loss reserve
Costs related to funding mortgage loans
Intersegment	113,062	142,999
Other	5,224,178	4,417,805
Intersegment	97,195	152,175
Other	54,620	198,968
Cost of goods and services sold - cemeteries and mortuaries	3,704,014	3,252,655
Total benefits and expenses	19,652,428	16,999,169
Earnings before income taxes	7,925,046	4,399,163
Income tax benefit (expense)	(1,975,787)	(1,009,137)
Net Earnings (Loss)	5,949,259	3,390,026
Identifiable Assets	73,432,116	56,335,498
Goodwill	2,488,213	754,018
Mortgage [Member]
Segment Reporting Information [Line Items]
Revenue from customers	263,418,230	298,933,110
Net investment income	519,018	710,622
Gains on investments and other assets	198,641	(39)
Other than temporary impairments
Other revenues	16,282,325	9,731,548
Net investment income	599,115	716,240
Total revenues	281,017,329	310,091,481
Death, surrenders and other policy benefits
Increase in future policy benefits
Amortization of deferred policy and pre-need acquisition costs and value of business acquired
Commissions	112,854,072	118,770,736
Personnel	68,880,448	53,871,504
Advertising	4,894,854	4,374,946
Rent and rent related	6,399,243	5,922,706
Depreciation on property and equipment	650,065	746,833
Provision for loan loss reserve		16,506,030
Costs related to funding mortgage loans	10,541,570	9,877,700
Intersegment	671,107	580,976
Other	35,766,430	31,104,479
Intersegment	6,712,511	7,182,913
Other	4,744,028	6,025,082
Cost of goods and services sold - cemeteries and mortuaries
Total benefits and expenses	252,114,328	254,963,905
Earnings before income taxes	28,903,001	55,127,576
Income tax benefit (expense)	(7,362,283)	(13,410,476)
Net Earnings (Loss)	21,540,718	41,717,100
Identifiable Assets	328,600,841	408,325,196
Goodwill
Intercompany Eliminations [Member]
Segment Reporting Information [Line Items]
Revenue from customers
Net investment income
Gains on investments and other assets
Other than temporary impairments
Other revenues
Net investment income	(8,482,991)	(9,090,248)
Total revenues	(8,482,991)	(9,090,248)
Death, surrenders and other policy benefits
Increase in future policy benefits
Amortization of deferred policy and pre-need acquisition costs and value of business acquired
Commissions
Personnel
Advertising
Rent and rent related
Depreciation on property and equipment
Provision for loan loss reserve
Costs related to funding mortgage loans
Intersegment	(1,281,282)	(1,345,136)
Other
Intersegment	(7,201,709)	(7,745,112)
Other
Cost of goods and services sold - cemeteries and mortuaries
Total benefits and expenses	(8,482,991)	(9,090,248)
Earnings before income taxes
Income tax benefit (expense)
Net Earnings (Loss)
Identifiable Assets	(96,099,992)	(90,398,039)
Goodwill
Consolidated [Member]
Segment Reporting Information [Line Items]
Revenue from customers	387,670,116	412,261,162
Net investment income	58,264,683	56,329,803
Gains on investments and other assets	6,265,134	1,925,850
Other than temporary impairments	(39,502)	(370,975)
Other revenues	18,535,111	11,317,482
Net investment income
Total revenues	470,695,542	481,463,322
Death, surrenders and other policy benefits	67,218,455	62,841,360
Increase in future policy benefits	26,263,312	23,568,650
Amortization of deferred policy and pre-need acquisition costs and value of business acquired	16,142,970	14,307,425
Commissions	118,286,469	124,426,297
Personnel	100,740,161	84,989,971
Advertising	6,626,418	5,380,896
Rent and rent related	7,242,287	6,873,561
Depreciation on property and equipment	1,935,613	2,078,738
Provision for loan loss reserve		16,506,030
Costs related to funding mortgage loans	10,541,570	9,877,700
Intersegment
Other	53,065,982	47,331,102
Intersegment
Other	7,127,516	8,578,810
Cost of goods and services sold - cemeteries and mortuaries	3,704,014	3,252,655
Total benefits and expenses	418,894,767	410,013,195
Earnings before income taxes	51,800,775	71,450,127
Income tax benefit (expense)	(12,281,785)	(15,853,514)
Net Earnings (Loss)	39,518,990	55,596,613
Identifiable Assets	1,542,339,522	1,545,420,890
Goodwill	$ 5,253,783	$ 3,519,588

Schedule of Right-of-Use Assets and Lease Liabilities (Details) - USD ($)	Dec. 31, 2021	Dec. 31, 2020
Leases
Operating Lease, Right-of-Use Asset	$ 12,483,638	$ 11,663,245
Operating Lease Liabilities	12,939,691	11,921,884
Finance Lease, Right-of-Use Assets	235,867	254,276
Finance Lease, Right-of-Use Asset, Accumulated Amortization	(177,660)	(154,144)
Finance Lease, Right-of-Use Assets, Net	58,207	100,132
Finance Lease Liabilities	$ 62,767	$ 104,951

Schedule of Assumptions Used (Details)

12 Months Ended

Dec. 31, 2021

$ / shares

All Plans December 3, 2021 [Member]

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Weighted Average Fair Value of Each Option

$ 2.99

Expected Dividend Yield

5.00%

^[1]

Underlying stock FMV

$ 8.62

Weighted Average Volatility

36.50%

Weighted Average Risk Free Interest Rate

1.15%

Weighted Average Expected Life (Term)

5 years 3 months 21 days

All Plans March 27, 2020 [Member]

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Weighted Average Fair Value of Each Option

$ 0.65

Expected Dividend Yield

5.00%

^[1]

Underlying stock FMV

$ 3.76

Weighted Average Volatility

32.29%

Weighted Average Risk Free Interest Rate

1.64%

Weighted Average Expected Life (Term)

4 years 9 months 25 days

[1]	Stock dividend

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2021

Income Tax Disclosure [Abstract]

Summary of Income Tax Liability

The Company’s income tax liability is summarized as follows:

Summary of Income Tax Liability

	2021			2020
	December 31
	2021			2020
Current	$	(1,558,687	)	$	2,595,877
Deferred		32,594,783			22,662,923
Total	$	31,036,096		$	25,258,800

Schedule of Deferred Tax Assets and Liabilities

Significant components of the Company’s deferred tax (assets) and liabilities are approximately as follows:

	2021			2020
	December 31
	2021			2020
Assets
Future policy benefits	$	(13,015,255	)	$	(12,657,045	)
Loan loss reserve		(636,256	)		(5,352,942	)
Unearned premium		(642,755	)		(699,011	)
Net operating loss		(898,029	)		(334,085	)
Deferred compensation		(2,750,406	)		(2,833,298	)
Deposit obligations		(635,878	)		(610,041	)
Other		(1,712,895	)		(1,269,533	)
Less: Valuation allowance		882,535			961,920
Total deferred tax assets		(19,408,939	)		(22,794,035	)

Liabilities
Deferred policy acquisition costs		17,166,200			16,430,001
Basis difference in property, equipment and real estate		9,247,242			5,312,787
Value of business acquired		1,768,501			1,880,602
Deferred gains		15,598,360			12,124,226
Trusts		1,064,387			1,064,387
Tax on unrealized appreciation		7,159,032			8,644,955
Total deferred tax liabilities		52,003,722			45,456,958
Net deferred tax liability	$	32,594,783		$	22,662,923

Schedule of Components of Income Tax Expense (Benefit)

The Company’s income tax expense is summarized as follows:

	2021		2020
	December 31
	2021		2020
Current
Federal	$	629,921	$	10,678,612
State		343,428		2,320,233
		973,349		12,998,845

Deferred
Federal		9,832,556		2,677,943
State		1,475,880		176,726
		11,308,436		2,854,669
Total	$	12,281,785	$	15,853,514

Schedule of Effective Income Tax Rate Reconciliation

The reconciliation of income tax expense at the U.S. federal statutory rates is as follows:

	2021			2020
	December 31
	2021			2020
Computed expense at statutory rate	$	10,878,163		$	15,004,527
State tax expense, net of federal tax benefit		1,437,255			1,972,598
Change in valuation allowance		(79,385	)		(1,477,474	)
Other, net		45,752			353,863
Income tax expense	$	12,281,785		$	15,853,514

Summary of Operating Loss Carryforwards

Net Operating Losses and Tax Credit Carryforwards:

Summary of Operating Loss Carryforwards

Year of Expiration
2022	$	-
2023		-
2024		-
2025		-
2026		-
Thereafter up through 2037		1,237,784
Indefinite carryforwards		2,742,661
	$	3,980,445

Investments (Details Narrative) - USD ($)	12 Months Ended
Investments (Details Narrative) - USD ($)	Dec. 31, 2021	Dec. 31, 2020
Net Investment Income [Line Items]
Average market value over amortized cost	97.30%	94.70%
Credit loss recognized	$ 39,502	$ 370,975
Maximum borrowing capacity	28,993,126
Remaining borrowing capacity	27,054,347
Net Investment Income	58,264,683	56,329,803
Securities deposit	101,681,853	9,684,409
Loans Payable to Bank	251,286,927	297,824,368
Nonperforming Financing Receivable	2,028,378	897,980
Impairment losses on residential real estate held for investment	$ 1,190,602	4,327,079
Loan Interest rate	7.00%
Interest not accrued on non-performing loans	$ 236,000	$ 491,000
UTAH
Net Investment Income [Line Items]
Loan Interest rate	70.00%	57.00%
FLORIDA
Net Investment Income [Line Items]
Loan Interest rate	7.00%	13.00%
CALIFORNIA
Net Investment Income [Line Items]
Loan Interest rate	5.00%	4.00%
TEXAS
Net Investment Income [Line Items]
Loan Interest rate	4.00%	9.00%
NEVADA
Net Investment Income [Line Items]
Loan Interest rate	4.00%	3.00%
ARIZONA
Net Investment Income [Line Items]
Loan Interest rate	2.00%	3.00%
Minimum [Member]
Net Investment Income [Line Items]
Loan Interest rate	2.00%
Maximum [Member]
Net Investment Income [Line Items]
Loan Interest rate	10.50%
Commercial Real Estate One [Member]
Net Investment Income [Line Items]
Collateral for bank loans	$ 134,251,205	$ 71,517,902
Commercial Real Estate 1 [Member]
Net Investment Income [Line Items]
Loans Payable to Bank	85,663,148	46,153,283
Residential Real Estate [Member]
Net Investment Income [Line Items]
Foreclosed residential real estate included in residential real estate held for investment	0	43,394
Cemeteries and Mortuaries [Member]
Net Investment Income [Line Items]
Net Investment Income	1,472,295	$ 676,313
FHLB [Member]
Net Investment Income [Line Items]
Other borrowings	$ 0

Schedule of Goodwill by Segment (Details) - USD ($)

Dec. 31, 2021

Dec. 31, 2020

Dec. 31, 2019

Indefinite-lived Intangible Assets [Line Items]

Goodwill, gross

$ 5,253,783

$ 3,519,588

Accumulated impairment

Total goodwill, net

5,253,783

3,519,588

Acquisition

1,734,195

Life Insurance [Member]

Indefinite-lived Intangible Assets [Line Items]

Goodwill, gross

2,765,570

Accumulated impairment

Total goodwill, net

2,765,570

Acquisition

Cemetery/Mortuary [Member]

Indefinite-lived Intangible Assets [Line Items]

Goodwill, gross

2,488,213

754,018

Accumulated impairment

Total goodwill, net

$ 2,488,213

754,018

Acquisition

$ 1,734,195

^[1]

[1]	See Note 20 regarding the acquisition of Rivera Funerals, Cremations and Memorial Gardens and Holbrook Mortuary

Consolidated Statements of Comprehensive Income - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Income Statement [Abstract]
Net earnings	$ 39,518,990	$ 55,596,613
Other comprehensive income:
Unrealized gains (losses) on fixed maturity securities available for sale	(6,517,731)	12,013,692
Unrealized gains (losses) on restricted assets	(23,250)	41,225
Unrealized losses on cemetery perpetual care trust investments	(11,114)	(6,817)
Foreign currency translation adjustments	2,835	(46)
Other comprehensive income (loss), before income tax	(6,549,260)	12,048,054
Income tax benefit (expense)	1,376,575	(2,531,435)
Other comprehensive income (loss), net of income tax	(5,172,685)	9,516,619
Comprehensive income	$ 34,346,305	$ 65,113,232

Income Taxes

12 Months Ended

Dec. 31, 2021

Income Tax Disclosure [Abstract]

Income Taxes

9) Income Taxes

The Company’s income tax liability is summarized as follows:

Summary of Income Tax Liability

	2021			2020
	December 31
	2021			2020
Current	$	(1,558,687	)	$	2,595,877
Deferred		32,594,783			22,662,923
Total	$	31,036,096		$	25,258,800

Significant components of the Company’s deferred tax (assets) and liabilities are approximately as follows:

	2021			2020
	December 31
	2021			2020
Assets
Future policy benefits	$	(13,015,255	)	$	(12,657,045	)
Loan loss reserve		(636,256	)		(5,352,942	)
Unearned premium		(642,755	)		(699,011	)
Net operating loss		(898,029	)		(334,085	)
Deferred compensation		(2,750,406	)		(2,833,298	)
Deposit obligations		(635,878	)		(610,041	)
Other		(1,712,895	)		(1,269,533	)
Less: Valuation allowance		882,535			961,920
Total deferred tax assets		(19,408,939	)		(22,794,035	)

Liabilities
Deferred policy acquisition costs		17,166,200			16,430,001
Basis difference in property, equipment and real estate		9,247,242			5,312,787
Value of business acquired		1,768,501			1,880,602
Deferred gains		15,598,360			12,124,226
Trusts		1,064,387			1,064,387
Tax on unrealized appreciation		7,159,032			8,644,955
Total deferred tax liabilities		52,003,722			45,456,958
Net deferred tax liability	$	32,594,783		$	22,662,923

The valuation allowance relates to differences between recorded deferred tax assets and liabilities and ultimate anticipated realization.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

9) Income Taxes (Continued)

The Company’s income tax expense is summarized as follows:

	2021		2020
	December 31
	2021		2020
Current
Federal	$	629,921	$	10,678,612
State		343,428		2,320,233
		973,349		12,998,845

Deferred
Federal		9,832,556		2,677,943
State		1,475,880		176,726
		11,308,436		2,854,669
Total	$	12,281,785	$	15,853,514

The reconciliation of income tax expense at the U.S. federal statutory rates is as follows:

	2021			2020
	December 31
	2021			2020
Computed expense at statutory rate	$	10,878,163		$	15,004,527
State tax expense, net of federal tax benefit		1,437,255			1,972,598
Change in valuation allowance		(79,385	)		(1,477,474	)
Other, net		45,752			353,863
Income tax expense	$	12,281,785		$	15,853,514

The Company’s overall effective tax rate for the years ended December 31, 2021 and 2020 was 23.7% and 22.2% respectively. The Company’s effective tax rates differ from the U.S. federal statutory rate of 21% partially due to its provision for state income taxes and a decrease to the valuation allowance. The increase in the effective tax rate when compared to the prior year is partially due to a smaller decrease to the valuation allowance in the current period when compared to the prior period year.

At December 31, 2021, the Company had no significant unrecognized tax benefits. As of December 31, 2021, the Company does not expect any material changes to the estimated amount of unrecognized tax benefits in the next twelve months. Federal and state income tax returns for 2018 through 2021 are subject to examination by taxing authorities.

Net Operating Losses and Tax Credit Carryforwards:

Summary of Operating Loss Carryforwards

Year of Expiration
2022	$	-
2023		-
2024		-
2025		-
2026		-
Thereafter up through 2037		1,237,784
Indefinite carryforwards		2,742,661
	$	3,980,445

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 21
-URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32857-109319

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section S99
-Paragraph 2
-Subparagraph (SAB Topic 11.C)
-URI http://asc.fasb.org/extlink&oid=122134291&loc=d3e330215-122817

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 17
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32809-109319

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SAB TOPIC 6.I.5.Q1)
-URI http://asc.fasb.org/extlink&oid=122134291&loc=d3e330036-122817

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 14
-URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32705-109319

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 270
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-URI http://asc.fasb.org/topic&trid=2144680

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 30
-Section 50
-Paragraph 2
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(h)(2))
-URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

+ Details

Acquisitions

12 Months Ended

Dec. 31, 2021

Business Combination and Asset Acquisition [Abstract]

Acquisitions

20) Acquisitions

Rivera Funerals, Cremations and Memorial Gardens

On December 21, 2021, the Company, through its wholly-owned subsidiary, Memorial Estates Inc., completed a business combination transaction with Rivera Funerals, Cremations and Memorial Gardens. The mortuaries and cemetery are located in New Mexico.

Under the terms of the transaction, as set forth in the Asset Purchase Agreement, dated December 21, 2021, Memorial Estates Inc. paid a net purchase price of $10,693,395 for the business and assets of Rivera Funerals, Cremations and Memorial Gardens, subject to holdback amounts held by Memorial Estates, Inc. in the total amount of $1,120,000. Pursuant to the Asset Purchase Agreement, Memorial Estates, Inc. is to use $70,000 of the holdback amount to pay, perform and discharge when due, trade accounts payable of Rivera Funerals, Cremations and Memorial Gardens to third parties that remained unpaid. Unapplied portions of the remaining $1,050,000 holdback amount are to be released and paid by Memorial Estates Inc. in annual payments of up to $105,000 each, beginning on the first anniversary date of the closing date and continuing thereafter on the anniversary dates of the closing date.

The estimated fair values of the assets acquired and liabilities assumed as of the date of acquisition were as follows:


Restricted assets (1)	$	618,006
Property and equipment (2)		6,255,836
Cemetery land and improvements		658,280
Goodwill		1,338,763
Other (3)		2,440,516
Total assets acquired		11,311,401

Cemetery perpetual care obligation		(618,006	)
Other liabilities - holdback		(1,120,000	)
Total liabilities assumed		(1,738,006	)
Fair value of net assets acquired/consideration paid	$	9,573,395

(1)		Includes $39,000 of cash and $579,006 of fixed maturity securities, available for sale, at estimated fair value which is a Level 2 asset in the fair value hierarchy

(2)		At estimated fair value which is a Level 3 asset in the fair value hierarchy

(3)		Including $2,310,000 of intangible assets

Rivera Funerals, Cremations and Memorial Gardens revenues and net earnings since the date of acquisition for the year ended December 31, 2021 were $137,386 and $14,892, respectively.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

20) Acquisitions (Continued)

Holbrook Mortuary

On December 28, 2021, the Company, through its wholly-owned subsidiary, Memorial Mortuary Inc., completed a business combination transaction with Holbrook Mortuary located in Salt Lake City, Utah.

Under the terms of the transaction, as set forth in the Asset Purchase Agreement, dated December 28, 2021, Memorial Mortuary Inc. paid a net purchase price of $3,051,747 for the business and assets of Holbrook Mortuary.

The estimated fair values of the assets acquired and liabilities assumed as of the date of acquisition were as follows:


Property and equipment (1)	$	2,641,210
Goodwill		395,432
Other		15,105
Total assets acquired		3,051,747

Fair value of net assets acquired/consideration paid	$	3,051,747

(1)

At estimated fair value which is a Level 3 asset in the fair value hierarchy

Holbrook Mortuary’s revenues and net loss since the date of acquisition for the year ended December 31, 2021 were $-0- and $(98,531), respectively.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

Statutory Financial Information and Dividend Limitations (Tables)

12 Months Ended

Dec. 31, 2021

Insurance [Abstract]

Schedule of Statutory Accounting Practices

	Statutory Net Income						Statutory Capital and Surplus
	Years Ended December 31						December 31
	2021			2020			2021		2020
Amounts by insurance subsidiary:
Security National Life Insurance Company	$	5,552,116		$	6,054,764		$	57,424,808	$	53,089,185
Kilpatrick Life Insurance Company		1,312,718			1,574,128			15,566,231		15,177,996
First Guaranty Insurance Company		624,550			790,221			7,734,357		7,045,644
Memorial Insurance Company of America		37			55			-		1,088,034
Southern Security Life Insurance Company, Inc.		275			183			1,578,225		1,581,647
Trans-Western Life Insurance Company		(2,089	)		(1,527	)		508,547		510,636
Total	$	7,487,607		$	8,417,824		$	82,812,168	$	78,493,142

Retirement Plans (Details Narrative) - Employee Stock Ownership Plan [Member] - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Pretax contributions	$ 19,500	$ 19,500
Employees stock ownership plan description		The Company matched 100% of up to 3% of an employee’s total annual compensation and matched 50% of 4% to 5% of an employee’s annual compensation.
Contribution to plan	2,820,315	$ 1,690,568
Compensation expenses	900,000	900,000
Present value of anticipated benefits	$ 7,556,363	6,656,363
Retirement description	Under the terms of the employment agreement, this individual is entitled to receive retirement benefits from the Company for a period of ten years in an amount equal to 50% of his rate of compensation at the time of his retirement
Retirement compensation	$ 267,685
Payment to retirement compensation	133,843	133,843
Accrued liability of retirement plan	$ 535,370	$ 669,212
Executive Officer [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Employees stock ownership plan description		Effective December 4, 2018, the Board members approved a motion to extend the Chief Executive Officer’s employment agreement, dated December 4, 2012, for an additional four-year term ending December 2022. In the event of disability, the Chief Executive Officer’s salary would be continued for up to five years at 75% of its current level of compensation. In the event of a sale or merger of the Company and the Chief Executive Officer is not retained in his current position, the Company would be obligated to continue paying the Chief Executive Officer’s current compensation and benefits for seven years following the merger or sale. The agreement further provides that the Chief Executive Officer is entitled to receive annual retirement benefits beginning (i) one month from the date of his retirement (to commence no sooner than age 65), (ii) five years following complete disability, or (iii) upon termination of his employment without cause. These retirement benefits are to be paid for a period of twenty years in annual installments in the amount equal to 75% of his then current level of compensation.

Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($)	Dec. 31, 2021	Dec. 31, 2020
Income Tax Disclosure [Abstract]
Future policy benefits	$ (13,015,255)	$ (12,657,045)
Loan loss reserve	(636,256)	(5,352,942)
Unearned premium	(642,755)	(699,011)
Net operating loss	(898,029)	(334,085)
Deferred compensation	(2,750,406)	(2,833,298)
Deposit obligations	(635,878)	(610,041)
Other	(1,712,895)	(1,269,533)
Less: Valuation allowance	882,535	961,920
Total deferred tax assets	(19,408,939)	(22,794,035)
Liabilities
Deferred policy acquisition costs	17,166,200	16,430,001
Basis difference in property, equipment and real estate	9,247,242	5,312,787
Value of business acquired	1,768,501	1,880,602
Deferred gains	15,598,360	12,124,226
Trusts	1,064,387	1,064,387
Tax on unrealized appreciation	7,159,032	8,644,955
Total deferred tax liabilities	52,003,722	45,456,958
Net deferred tax liability	$ 32,594,783	$ 22,662,923

Schedule of Components of Income Tax Expense (Benefit) (Details) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Current
Federal	$ 629,921	$ 10,678,612
State	343,428	2,320,233
Total Current Income Tax Expense (Benefit)	973,349	12,998,845
Deferred
Federal	9,832,556	2,677,943
State	1,475,880	176,726
Total Deferred Income Tax Expense (Benefit)	11,308,436	2,854,669
Total	$ 12,281,785	$ 15,853,514

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References + Details

Bank and Other Loans Payable (Details Narrative)	12 Months Ended
Bank and Other Loans Payable (Details Narrative)	Dec. 31, 2021 USD ($)	Dec. 31, 2020 USD ($)
Line of Credit Facility [Line Items]
Line of credit, maximum borrowing	$ 28,993,126
Investment	823,555,327	$ 773,945,298
Interest expense	7,127,516	8,578,810
Interest Paid, Including Capitalized Interest, Operating and Investing Activities	7,290,867	8,385,270
Mortgage Warehouse Line of Credit 1 [Member]
Line of Credit Facility [Line Items]
Line of credit	$ 100,000,000
Maturity date	Jun. 09, 2022
Debt instrument basis spread variable rate	210.00%
Line of Credit Facility, Description	The Company, through its subsidiary SecurityNational Mortgage, has a $100,000,000 line of credit with Wells Fargo Bank N.A. The agreement charges interest at the 1-Month LIBOR rate plus 2.1% and matures on June 9, 2022. SecurityNational Mortgage is required to comply with covenants for adjusted tangible net worth, unrestricted cash balance, the ratio of indebtedness to adjusted tangible net worth, and the liquidity overhead coverage ratio, and a quarterly gross profit of at least $1.00.
Line of credit, indebtedness	0.0100
Mortgage Warehouse Line of Credit Two [Member]
Line of Credit Facility [Line Items]
Maturity date	Aug. 09, 2022
Debt instrument basis spread variable rate	200.00%
Line of credit, indebtedness	0.0100
Mortgage Warehouse Line of Credit Three [Member]
Line of Credit Facility [Line Items]
Maturity date	May 27, 2022
Debt instrument basis spread variable rate	215.00%
Line of credit, indebtedness	0.0100
Mortgage Warehouse Line of Credit Four [Member]
Line of Credit Facility [Line Items]
Maturity date	Jun. 04, 2022
Debt instrument basis spread variable rate	200.00%
Line of credit, indebtedness	0.0100
Kilpatrick Life Insurance Company [Member]
Line of Credit Facility [Line Items]
Investment	$ 1,720,300	1,720,300
Maximum [Member] \| Mortgage Warehouse Line of Credit Three [Member]
Line of Credit Facility [Line Items]
Line of credit, maximum borrowing	75,000,000
Maximum [Member] \| Mortgage Warehouse Line of Credit Four [Member]
Line of Credit Facility [Line Items]
Line of credit, maximum borrowing	100,000,000
FHLB [Member]
Line of Credit Facility [Line Items]
Line of credit, maximum borrowing	19,259,722	39,102,336
Mortage property, fair value	20,244,900	40,729,400
Line of credit	0	0
Investment	826,800	786,300
FHLB [Member] \| Kilpatrick Life Insurance Company [Member]
Line of Credit Facility [Line Items]
Line of credit, maximum borrowing	7,794,625	0
Mortage property, fair value	8,774,352	0
Line of credit	0	$ 0
FHLB [Member] \| Minimum [Member]
Line of Credit Facility [Line Items]
Mortage property, fair value	443,758
Bank [Member]
Line of Credit Facility [Line Items]
Line of credit, maximum borrowing	2,000,000
Mortage property, fair value	941,711
Line of credit	$ 0
Maturity date	Dec. 31, 2022
Bank 1 [Member]
Line of Credit Facility [Line Items]
Line of credit, maximum borrowing	$ 2,500,000
Line of credit	$ 1,250,000
Maturity date	Dec. 31, 2022
Debt instrument basis spread variable rate	2.25%
Bank 1 [Member] \| Maximum [Member] \| Mortgage Warehouse Line of Credit Two [Member]
Line of Credit Facility [Line Items]
Line of credit, maximum borrowing	$ 100,000,000

Value of Business Acquired, Intangible Assets and Goodwill (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Value of business acquired - net amortization charged to income	$ (1,120,657)	$ (921,398)
Weighted average amortization period	5 years 10 months 24 days
Year 2022 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Value of business acquired - net amortization charged to income	$ 1,059,000
Year 2023 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Value of business acquired - net amortization charged to income	972,000
Year 2024 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Value of business acquired - net amortization charged to income	893,000
Year 2025 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Value of business acquired - net amortization charged to income	810,000
Year 2026 and 2027 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Value of business acquired - net amortization charged to income	$ 753,000

Schedule of Mortgage Servicing Rights (Details) - USD ($)

12 Months Ended

Dec. 31, 2021

Dec. 31, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

Balance before valuation allowance at beginning of year

$ 35,210,516

$ 17,155,529

MSR additions resulting from loan sales

32,701,819

29,896,465

Amortization (1)

^[1]

(14,851,880)

(11,841,478)

Application of valuation allowance to write down MSRs with other than temporary impairment

Balance before valuation allowance at year end

53,060,455

35,210,516

Balance at beginning of year

Additions

Application of valuation allowance to write down MSRs with other than temporary impairment

Balance at year end

Mortgage servicing rights, net

53,060,455

35,210,516

Estimated fair value of MSRs at end of period

$ 68,811,809

$ 38,702,358

[1]	Included in other expenses on the consolidated statements of earnings

Summary of Unpaid Principal Balances of the Servicing Portfolio (Details) - USD ($)	Dec. 31, 2021	Dec. 31, 2020
Goodwill and Intangible Assets Disclosure [Abstract]
Servicing unpaid principal balance	$ 7,060,536,350	$ 5,070,287,864

Summary of Bank Loans Payable (Details) - USD ($)

Dec. 31, 2021

Dec. 31, 2020

Debt Instrument [Line Items]

Total bank and other loans

$ 251,286,927

$ 297,824,368

Finance lease liabilities

62,767

104,951

Current Installment

164,747,672

284,250,996

Bank and other loans, excluding current installments

86,539,255

13,573,372

Note Payable 1 [Member]

Debt Instrument [Line Items]

Total bank and other loans

633,890

Note Payable 2 [Member]

Debt Instrument [Line Items]

Total bank and other loans

2,481,878

3,257,113

Note Payable 3 [Member]

Debt Instrument [Line Items]

Total bank and other loans

1,825,608

1,861,920

Note Payable 4 [Member]

Debt Instrument [Line Items]

Total bank and other loans

34,547,181

Note Payable 5 [Member]

Debt Instrument [Line Items]

Total bank and other loans

35,091,364

Note Payable 6 [Member]

Debt Instrument [Line Items]

Total bank and other loans

40,090,359

Note Payable 7 [Member]

Debt Instrument [Line Items]

Total bank and other loans

9,200,000

Note Payable 8 [Member]

Debt Instrument [Line Items]

Total bank and other loans

66,305,025

116,598,834

Note Payable 9 [Member]

Debt Instrument [Line Items]

Total bank and other loans

50,555,909

68,766,572

Note Payable 10 [Member]

Debt Instrument [Line Items]

Total bank and other loans

43,196,986

60,715,374

Note Payable 11 [Member]

Debt Instrument [Line Items]

Total bank and other loans

1,764,386

Note Payable 12 [Member]

Debt Instrument [Line Items]

Total bank and other loans

317,582

Other Short-term Borrowings [Member]

Debt Instrument [Line Items]

Total bank and other loans

^[1]

1,250,000

Other Loans Payable [Member]

Debt Instrument [Line Items]

Total bank and other loans

$ 6,828

$ 26,768

[1]	Revolving Line of Credit

Stock Compensation Plans

12 Months Ended

Dec. 31, 2021

Share-based Payment Arrangement [Abstract]

Stock Compensation Plans

13) Stock Compensation Plans

The Company has two fixed option plans (the “2013 Plan” and the “2014 Director Plan”). Compensation expense for options issued of $118,384 and $358,878 has been recognized under these plans for the years ended December 31, 2021 and 2020, respectively, and is included in personnel expenses on the consolidated statements of earnings. As of December 31, 2021, the total unrecognized compensation expense related to the options issued was $875,735, which is expected to be recognized over the vesting period of one year.

The fair value of each option granted is estimated on the date of grant using the Black Scholes Option Pricing Model. The Company estimates the expected life of the options using the simplified method. Future volatility is estimated based upon the weighted historical volatility of the Company’s Class A common stock over a period equal to the expected life of the options. The risk-free interest rate for the expected life of the options is based upon the Federal Reserve Board’s daily interest rates in effect at the time of the grant.

The following table summarizes the assumptions used in estimating the fair value of each option granted along with the weighted-average fair value of the options granted.

Schedule of Assumptions Used

				Assumptions
Grant Date	Plan	Weighted-Average Fair Value of Each Option		Expected Dividend Yield (1)			Underlying stock FMV		Weighted-Average Volatility			Weighted-Average Risk-Free Interest Rate			Weighted-Average Expected Life (years)
December 3, 2021	All Plans	$	2.99		5	%	$	8.62		36.50	%		1.15	%		5.31

March 27, 2020	All Plans	$	0.65		5	%	$	3.76		32.29	%		1.64	%		4.82

(1)	Stock dividend

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

13) Stock Compensation Plans (Continued)

Activity of the stock option plans is summarized as follows:

	Number of Class A Shares			Weighted Average Exercise Price		Number of Class C Shares			Weighted Average Exercise Price
Outstanding at January 1, 2020		1,086,053		$	4.20		594,132		$	5.10
Adjustment for the effect of stock dividends		27,968					19,354
Granted		77,000					180,000
Exercised		(116,487	)				(130,820	)
Cancelled		(1,671	)				-

Outstanding at December 31, 2020		1,072,863		$	4.12		662,666		$	4.50
Adjustment for the effect of stock dividends		47,594					33,136
Granted		89,500					230,000
Exercised		(183,935	)				(104,656	)
Cancelled		(1,671	)				-

Outstanding at December 31, 2021		1,024,351		$	4.61		821,146		$	5.48

Exercisable at end of year		934,851		$	4.23		591,146		$	4.26

Available options for future grant		232,376					16,689

Weighted average contractual term of options outstanding at December 31, 2021		4.54 years					7.24 years

Weighted average contractual term of options exercisable at December 31, 2021		4.03 years					6.62 years

Aggregated intrinsic value of options outstanding at December 31, 2021 (1)	$	4,700,708				$	3,009,168

Aggregated intrinsic value of options exercisable at December 31, 2021 (1)	$	4,648,798				$	2,918,768

(1)	The Company used a stock price of $9.20 as of December 31, 2021 to derive intrinsic value.

The total intrinsic value (which is the amount by which the fair value of the underlying stock exceeds the exercise price of an option on the exercise date) of stock options exercised during the years ended December 31, 2021 and 2020 was $1,153,417 and $663,901, respectively.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

Capital Stock (Details Narrative) - $ / shares	12 Months Ended
Capital Stock (Details Narrative) - $ / shares	Dec. 31, 2021	Dec. 31, 2020
Class of Stock [Line Items]
Preferred stock, par value	$ 1.00	$ 1.00
Preferred stock, shares authorized	5,000,000	5,000,000
Preferred stock, shares issued	0	0
Common stock voting rights	Class C shares have 10 votes per share on all matters except for the election of one third of the directors who are elected solely by the Class A shares.
Stockholders dividends descriptions	Stockholders of both Class A and Class C common stock have received 5% stock dividends in the years 1990 through 2019, a 7.5% stock dividend in the year 2020, and a 5% stock dividend in the year 2021, as authorized by the Company’s Board of Directors.
Share-based Payment Arrangement, Option [Member]
Class of Stock [Line Items]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	50,000	0
Common Class B [Member]
Class of Stock [Line Items]
Common Stock, Par or Stated Value Per Share	$ 1.00	$ 1.00
Common Stock, Shares Authorized	5,000,000	5,000,000
Common Stock, Shares, Issued	0	0

Schedule of Restricted Assets in Cemetery and Mortuary Endowment Care and Pre need Merchandise Funds (Details) (Parenthetical) - USD ($)	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items]
Cash, cash equivalents, restricted cash and restricted cash equivalents at end of year	$ 141,414,282	$ 115,465,086	$ 137,735,673
Security National Life Insurance [Member]
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items]
Cash, cash equivalents, restricted cash and restricted cash equivalents at end of year	$ 7,869,295	$ 852,499

Schedule of Effective Income Tax Rate Reconciliation (Details) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Income Tax Disclosure [Abstract]
Computed expense at statutory rate	$ 10,878,163	$ 15,004,527
State tax expense, net of federal tax benefit	1,437,255	1,972,598
Change in valuation allowance	(79,385)	(1,477,474)
Other, net	45,752	353,863
Total	$ 12,281,785	$ 15,853,514

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References + Details

Property and Equipment (Tables)

12 Months Ended

Dec. 31, 2021

Property, Plant and Equipment [Abstract]

Schedule of Property, Plant and Equipment

Property and equipment is summarized below:

	2021			2020
	December 31
	2021			2020
Land and buildings	$	16,532,593		$	11,972,802
Furniture and equipment		24,799,115			19,679,682
Property, Plant and Equipment, Gross		41,331,708			31,652,484
Less accumulated depreciation		(19,814,110	)		(19,179,139	)
Total	$	21,517,598		$	12,473,345

Acquisitions (Details Narrative) - USD ($)	12 Months Ended
Acquisitions (Details Narrative) - USD ($)	Dec. 31, 2021	Dec. 31, 2020
Business Acquisition [Line Items]
Business combination, purchase price	$ 10,693,395
Rivera Funerals Cremations and Memorial Gardens [Member]
Business Acquisition [Line Items]
Business combination, purchase price	70,000
Business combination, holdback amount	1,120,000
Payment to acquire assets	1,050,000
Business acquisition of revenues and net earnings	137,386	$ 14,892
Rivera Funerals Cremations and Memorial Gardens [Member] \| Maximum [Member]
Business Acquisition [Line Items]
Payment to acquire assets	105,000
Holbrook Mortuary [Member]
Business Acquisition [Line Items]
Business combination, purchase price	3,051,747
Business acquisition of revenues and net loss	$ 0	$ (98,531)

Schedule of Receivables (Details) - USD ($)

Dec. 31, 2021

Dec. 31, 2020

Dec. 31, 2019

Receivables [Abstract]

Trade contracts

^[1]

$ 5,298,636

$ 4,119,988

$ 2,778,879

Receivables from sales agents

2,360,807

2,677,774

Other

12,457,398

5,786,827

Total receivables

20,116,841

12,584,589

Allowance for doubtful accounts

(1,800,725)

(1,685,382)

Net receivables

$ 18,316,116

$ 10,899,207

[1]	Included in Receivables, net on the consolidated balance sheets

Assets and Liabilities Measured at Fair Value on A Recurring Basis (Details) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Loans Held For Sale [Member]
Subsidiary, Sale of Stock [Line Items]
Fair value balance	$ 302,776,827	$ 422,772,418	$ 213,457,632
Fair value measurement, range of inputs, minimum value	95.00%	99.00%
Fair value measurement, range of inputs, minimum value	109.00%	110.00%
Fair value measurement with unobservable inputs reconciliation, recurring basis, asset and liability, weighted average	103.00%	104.00%
Net Derivatives Loan Commitments [Member]
Subsidiary, Sale of Stock [Line Items]
Fair value balance	$ 7,015,515	$ 10,128,610	2,491,233
Fair value measurement, range of inputs, minimum value	66.00%	52.00%
Fair value measurement, range of inputs, minimum value	95.00%	92.00%
Fair value measurement with unobservable inputs reconciliation, recurring basis, asset and liability, weighted average	81.00%	81.00%
Fixed Maturity Securities Available For Sale [Member]
Subsidiary, Sale of Stock [Line Items]
Fair value balance	$ 2,023,348	$ 2,201,175	$ 3,216,382
Fair value measurement, range of inputs, minimum value	96.87%	90.83%
Fair value measurement, range of inputs, minimum value	111.11%	119.33%
Fair value measurement with unobservable inputs reconciliation, recurring basis, asset and liability, weighted average	106.73%	113.47%

Value of Business Acquired, Intangible Assets and Goodwill

12 Months Ended

Dec. 31, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

Value of Business Acquired, Intangible Assets and Goodwill

5) Value of Business Acquired, Intangible Assets and Goodwill

Information with regard to value of business acquired was as follows:

Schedule of Value of Business Acquired

	2021			2020
	December 31
	2021			2020
Balance at beginning of year	$	8,955,249		$	9,876,647
Value of business acquired		586,840			-
Imputed interest at 7% included in earnings		613,028			670,565
Amortization included in earnings		(1,728,157	)		(1,457,390	)
Shadow amortization included in other comprehensive income		(5,528	)		(134,573	)
Net amortization		(1,120,657	)		(921,398	)
Balance at end of year	$	8,421,432		$	8,955,249

Presuming no additional acquisitions, net amortization charged to income is expected to approximate $1,059,000, $972,000, $893,000, $810,000, and $753,000 for the years 2022 through 2027 . Actual amortization may vary based on changes in assumptions or experience. As of December 31, 2021, value of business acquired is being amortized over a weighted average life of 5.9 years.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

5) Value of Business Acquired, Intangible Assets and Goodwill (Continued)

The carrying value of the Company’s intangible assets were as follows which is included in other assets:

		December 31
	Useful Life	2021			2020
Intangible asset - trade name (1)	15 years	$	2,100,000		$	-
Intangible asset - customer lists	15 years		890,000			890,000
Intangible asset - trade name (2)	15 years		610,000			610,000
Intangible assets - other (1)	15 years		210,000			-
Less accumulated amortization			(297,333	)		(197,334	)
Balance at end of year		$	3,512,667		$	1,302,666

(1)	See Note 20 regarding the acquisition of Rivera Funerals, Cremations and Memorial Gardens

(2)	Kilpatrick Life

Information regarding goodwill by segment was as follows:

Schedule of Goodwill by Segment

	Life Insurance		Cemetery/ Mortuary			Total
Balance at January 1, 2020:
Goodwill	$	2,765,570	$	754,018		$	3,519,588
Accumulated impairment		-		-			-
Total goodwill, net		2,765,570		754,018			3,519,588

Acquisition		-		-			-

Balance at December 31, 2020:
Goodwill		2,765,570		754,018			3,519,588
Accumulated impairment		-		-			-
Total goodwill, net		2,765,570		754,018			3,519,588

Acquisition		-		1,734,195	(1)		1,734,195

Balance at December 31, 2021:
Goodwill		2,765,570		2,488,213			5,253,783
Accumulated impairment		-		-			-
Total goodwill, net	$	2,765,570	$	2,488,213		$	5,253,783

(1)	See Note 20 regarding the acquisition of Rivera Funerals, Cremations and Memorial Gardens and Holbrook Mortuary

Goodwill is not amortized but is tested annually for impairment. The annual impairment tests resulted in no impairment of goodwill for the years ended December 31, 2021 and 2020.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

Schedule of Loan Loss Reserve Included in Other Liabilities and Accrued Expenses (Details) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Loans Held For Sale
Balance, beginning of period	$ 20,583,618	$ 4,046,288
Provision for current loan originations (1)	2,211,230	4,938,214
Additional provision for loan loss reserve		16,506,030
Charge-offs, net of recaptured amounts	(20,347,709)	(4,906,914)
Balance, at December 31	$ 2,447,139	$ 20,583,618

Schedule of Real Estate Owned and Occupied by the Company (Details)

Dec. 31, 2021

ft²

Mortgage Operations [Member]

Approximate square footage

221,000

Square footage occupied by the company

50.00%

Life Insurance Operations [Member]

Approximate square footage

19,694

Square footage occupied by the company

28.00%

Life Insurance Operations 1 [Member]

Approximate square footage

12,274

^[1]

Square footage occupied by the company

100.00%

^[1]

Life Insurance Sales [Member]

Approximate square footage

8,059

^[1]

Square footage occupied by the company

100.00%

^[1]

Life Insurance Sales 1 [Member]

Approximate square footage

1,560

^[1]

Square footage occupied by the company

100.00%

^[1]

Life Insurance Sales 2 [Member]

Approximate square footage

1,737

^[1]

Square footage occupied by the company

100.00%

^[1]

[1]	Included in property and equipment on the consolidated balance sheets

Schedule of Fair Value of Fixed Maturity Securities (Details) (Parenthethical) - USD ($)	Dec. 31, 2021	Dec. 31, 2020
Membership [Member]
Short term investment	$ 905,700	$ 866,900
Activity Stock Due [Member]
Short term investment	$ 1,641,400	$ 1,639,700

Cemetery Perpetual Care Trust Investments and Obligation and Restricted Assets (Tables)

12 Months Ended

Dec. 31, 2021

Cemetery Perpetual Care Trust Investments And Obligation And Restricted Assets

Schedule of The Components of The Cemetery Perpetual Care Obligation

The components of the cemetery perpetual care investments and obligation are as follows:

	2021			2020
	December 31
	2021			2020
Cash and cash equivalents	$	1,059,519		$	402,913
Fixed maturity securities, available for sale, at estimated fair value		784,765			747,767
Equity securities, at estimated fair value		3,302,480			2,062,303
Participating interests in residential construction mortgage loans held for investment with Security National Life		1,823,533			1,468,600
Real estate held for investment		865,424			1,731,584
Total cemetery perpetual care trust investments		7,835,721			6,413,167
Cemetery perpetual care obligation		(4,915,285	)		(4,087,704	)
Trust investments in excess of trust obligations	$	2,920,436		$	2,325,463

Schedule of Restricted Assets in Cemetery and Mortuary Endowment Care and Pre need Merchandise Funds

Restricted assets are summarized as follows:

	2021		2020
	December 31
	2021		2020
Cash and cash equivalents (1)	$	9,000,293	$	8,842,744
Fixed maturity securities, available for sale, at estimated fair value		1,601,688		1,473,637
Equity securities, at estimated fair value		3,603,822		2,515,778
Participating interests in mortgage loans held for investment with Security National Life		2,732,319		3,317,877
Total	$	16,938,122	$	16,150,036

Related Party Transactions

12 Months Ended

Dec. 31, 2021

Related Party Transactions

16) Related Party Transactions

The Company’s Board of Directors has a written procedure, which requires disclosure to the Board of any material interest or any affiliation on the part of any of its officers, directors or employees that is in conflict or may be in conflict with the interests of the Company. The Company and its Board of Directors is unaware of any related party transactions that require disclosure as of December 31, 2021.

Schedule of Other Revenues (Details) - USD ($)	12 Months Ended
Schedule of Other Revenues (Details) - USD ($)	Dec. 31, 2021	Dec. 31, 2020
Total	$ 18,535,111	$ 11,317,482
Total	15,792,644	9,246,574
Contractual Servicing Fees [Member]
Total	15,471,307	8,940,612
Late Fees [Member]
Total	$ 321,337	$ 305,962

Schedule of Estimated Fair Values of Assets Acquired and Liabilities Assumed (Details) (Parenthetical) - Rivera Funerals Cremations and Memorial Gardens [Member]	Dec. 31, 2021 USD ($)
Business Acquisition [Line Items]
Business acquisition of intangible assets	$ 2,310,000
Fair Value, Inputs, Level 2 [Member]
Business Acquisition [Line Items]
Business acquisition of cash	39,000
Business acquisition of fixed assets	$ 579,006

Revenues from Contracts with Customers (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Disaggregation of Revenue [Line Items]
Deferred pre-need cemetery and mortuary contract revenues	$ 14,508,022	$ 13,080,179
Deferred revenue	14,508,022	13,080,179	$ 12,607,978
Revenue recognized included in the opening contract liability	4,528,646	4,359,709
Pre Need Merchandise and Service Revenue [Member]
Disaggregation of Revenue [Line Items]
Deferred revenue	13,722,348	12,545,753
At Need Specialty Merchandise Revenue [Member]
Disaggregation of Revenue [Line Items]
Deferred revenue	785,674	534,426
Deferred Pre-need Land Revenue [Member]
Disaggregation of Revenue [Line Items]
Deferred revenue	$ 0	$ 0
Revenue, remaining performance obligation, percentage	10.00%

Capital Stock

12 Months Ended

Dec. 31, 2021

Equity [Abstract]

Capital Stock

12) Capital Stock

The Company has one class of preferred stock of $1.00 par value, 5,000,000 shares authorized, of which none are issued. The preferred stock is non-voting.

The Company has two classes of common stock with shares outstanding, Class A common shares and Class C common shares. Class C shares have 10 votes per share on all matters except for the election of one third of the directors who are elected solely by the Class A shares. Class C shares are convertible into Class A shares at any time on a one to one ratio. The decrease in treasury stock was the result of treasury stock being used to fund the company’s 401(k) and deferred compensation plans.

Stockholders of both Class A and Class C common stock have received 5% stock dividends in the years 1990 through 2019, a 7.5% stock dividend in the year 2020, and a 5% stock dividend in the year 2021, as authorized by the Company’s Board of Directors.

The Company has Class B common stock of $1.00 par value, 5,000,000 shares authorized, of which none are issued. Class B shares are non-voting stock except to any proposed amendment to the Articles of Incorporation which would affect Class B common stock.

The following table summarizes the activity in shares of capital stock.

	Class A		Class C
Outstanding shares at December 31, 2019		16,107,779		2,500,887

Exercise of stock options		68,970		130,820
Stock dividends		405,210		61,720
Conversion of Class C to Class A		13,824		(13,824	)

Outstanding shares at December 31, 2020		16,595,783		2,679,603

Exercise of stock options		160,282		104,656
Stock dividends		837,410		131,553
Conversion of Class C to Class A		49,247		(49,247	)

Outstanding shares at December 31, 2021		17,642,722		2,866,565

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

12) Capital Stock (Continued)

Earnings per share amounts have been retroactively adjusted for the effect of annual stock dividends. In accordance with GAAP, the basic and diluted earnings per share amounts were calculated as follows:

	2021		2020
	Years Ended December 31
	2021		2020
Numerator:
Net earnings	$	39,518,990	$	55,596,613

Denominator:
Denominator for basic earnings per share-weighted-average shares		20,154,878		19,788,984

Effect of dilutive securities
Employee stock options		774,206		465,423
Dilutive potential common shares		774,206		465,423

Denominator for diluted earnings per share-adjusted weighted-average
shares and assumed conversions		20,929,084		20,254,407

Basic earnings per share	$	1.96	$	2.81
Diluted earnings per share	$	1.89	$	2.74

For the years ended December 31, 2021 and 2020, there were 50,000 and -0- of anti-dilutive employee stock option shares, respectively, that were not included in the computation of diluted net earnings per common share as their effect would be anti-dilutive.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

- Definition

The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496158-112644

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
-Topic 505
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
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Reference 13: http://www.xbrl.org/2003/role/disclosureRef
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Reference 14: http://www.xbrl.org/2003/role/disclosureRef
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Reference 15: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

Bank and Other Loans Payable

12 Months Ended

Dec. 31, 2021

Debt Disclosure [Abstract]

Bank and Other Loans Payable

7) Bank and Other Loans Payable

Bank and other loans payable are summarized as follows:

Summary of Bank Loans Payable

	December 31
	2021		2020
		-		633,890

4.27% fixed note payable in monthly installments of $53,881 including principal and interest, collateralized by shares of Security National Life Insurance Company stock, paid in full December 2021.		-		633,890

Prime rate note payable in monthly installments of $75,108 including principal and interest, collateralized by shares of Security National Life Insurance Company stock, due December 2024.		2,481,878		3,257,113

4.329% fixed note payable in monthly installments of $9,775 including principal and interest, collateralized by real property with a book value of approximately $3,103,000, due September 2025.		1,825,608		1,861,920

4.00% variable with LIBOR at a 1% floor and a spread at 3% rate construction loan collateralized by real property with a book value of approximately $64,730,000, due March 2024.		34,547,181		-

2.5% above the monthly LIBOR rate plus 1/16th of the monthly LIBOR rate construction loan payable in monthly principal payments of $113,000 plus interest, collateralized by real property with a book value of approximately $49,118,000, paid in full March 2021.		-		35,091,364

3.30% fixed note payable in monthly installments of $179,562 including principal and interest, collateralized by real property with a book value of approximately $49,118,000, due April 2051.		40,090,359		-

4.7865% fixed interest only note payable in monthly installments, collateralized by real property with a book value of approximately $17,301,000, due June 2028.		9,200,000		9,200,000

1 month LIBOR rate plus 2.1% loan purchase agreement with a warehouse line availability of $100,000,000, matures June 2022.		66,305,025		116,598,834

1 month LIBOR rate plus 2% loan purchase agreement with a warehouse line availability of $100,000,000, matures August 2022.		50,555,909		68,766,572

1 month LIBOR rate plus 2.15% loan purchase agreement with a warehouse line availability of $75,000,000, matures May 2022.		43,196,986		60,715,374

1 month LIBOR rate plus 2.0% loan purchase agreement with a warehouse line availability of $100,000,000, matures June 2022.		1,764,386		-

1 month LIBOR rate plus 2.5% loan purchase agreement with a warehouse line availability of $5,000,000, matured August 2021.		-		317,582

Other short-term borrowings (1)		1,250,000		1,250,000

Finance lease liabilities		62,767		104,951

Other loans payable		6,828		26,768
Total bank and other loans		251,286,927		297,824,368

Less current installments		164,747,672		284,250,996
Bank and other loans, excluding current installments	$	86,539,255	$	13,573,372

(1)	Revolving Line of Credit

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

7) Bank and Other Loans Payable (Continued)

Sources of Liquidity

Federal Home Loan Bank Membership

The Federal Home Loan Banks (“the FHLBs”) are a group of cooperatives that lending institutions use to finance housing and economic development in local communities. The Company is a member of the FHLB based in Des Moines, Iowa and based in Dallas, Texas. As a member of the FHLB, the Company is required to maintain a minimum investment in capital stock of the FHLB and may pledge collateral to the bank for advances of funds to be used in its operations.

Federal Home Loan Bank of Des Moines

At December 31, 2021, the amount available for borrowings from the FHLB of Des Moines was approximately $19,259,722, compared with $39,102,336 at December 31, 2020. United States Treasury fixed maturity securities with an estimated fair value of $20,244,900 at December 31, 2021 have been pledged at the FHLB of Des Moines as collateral for current and potential borrowings compared with $40,729,400 at December 31, 2020. At December 31, 2021 and 2020, the Company had no outstanding FHLB borrowings. At December 31, 2021, the Company’s total investment in FHLB stock was $826,800 compared with $786,300 at December 31, 2020. The Company’s increased investment in FHLB stock was a result of its increase in short-term FHLB borrowings during 2021. At December 31, 2021, the Company was contingently liable under a standby letter of credit aggregating $443,758, to be used as collateral to cover any contingency related to additional risk assessments pertaining to the Company’s captive insurance program.

Federal Home Loan Bank of Dallas

At December 31, 2021, the amount available for borrowings from the FHLB of Dallas was approximately $7,794,625, compared with $-0- at December 31, 2020. Mortgage-Backed fixed maturity securities with an estimated fair value of $8,774,352 at December 31, 2021 have been pledged at the FHLB of Dallas as collateral for current and potential borrowings compared with $-0- at December 31, 2020. At December 31, 2021 and 2020, the Company had no outstanding FHLB borrowings. At December 31, 2021, the Company’s total investment in FHLB stock was $1,720,300 compared with $1,720,300 at December 31, 2020.

Revolving Lines of Credit

The Company has a $2,000,000 revolving line-of-credit with a bank with interest payable at the prime rate minus .75%, secured by the capital stock of Security National Life and maturing December 31, 2022, renewable annually. At December 31, 2021, the Company was contingently liable under standby letters of credit aggregating $941,711, to be used as collateral for residential subdivision land developments. The standby letters of credit will draw on the line of credit if necessary. The Company does not expect any material losses to result from the issuance of the standby letters of credit. As of December 31, 2021, there were no amounts outstanding under the revolving line-of-credit.

The Company also has a $2,500,000 revolving line-of-credit with a bank with interest payable at the overnight LIBOR rate plus 2.25% maturing December 31, 2022. As of December 31, 2021, there was $1,250,000 outstanding under the revolving line-of-credit.

Debt Covenants for Mortgage Warehouse Lines of Credit

The Company, through its subsidiary SecurityNational Mortgage, has a $100,000,000 line of credit with Wells Fargo Bank N.A. The agreement charges interest at the 1-Month LIBOR rate plus 2.1% and matures on June 9, 2022. SecurityNational Mortgage is required to comply with covenants for adjusted tangible net worth, unrestricted cash balance, the ratio of indebtedness to adjusted tangible net worth, and the liquidity overhead coverage ratio, and a quarterly gross profit of at least $1.00.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

7) Bank and Other Loans Payable (Continued)

The Company, through its subsidiary SecurityNational Mortgage, has a line of credit with Texas Capital Bank N.A. This agreement with the bank allows SecurityNational Mortgage to borrow up to $100,000,000 for the sole purpose of funding mortgage loans. The agreement charges interest at the 1-Month LIBOR rate plus 2% and matures on August 9, 2022. The Company is required to comply with covenants for adjusted tangible net worth, unrestricted cash balance, and minimum combined pre-tax income (excluding any changes in the fair value of mortgage servicing rights) of at least $1.00 on a rolling four-quarter basis.

The Company through its subsidiary SecurityNational Mortgage, has a line of credit with Comerica Bank. This agreement with the bank allows SecurityNational Mortgage to borrow up to $75,000,000 for the sole purpose of funding mortgage loans. The agreement charges interest at the 1-Month LIBOR rate plus 2.15% and matures on May 27, 2022. The Company is required to comply with covenants for adjusted tangible net worth, unrestricted cash balance, and minimum combined pre-tax income (excluding any changes in the fair value of mortgage servicing rights) of at least $1.00 on a rolling twelve months.

The Company through its subsidiary SecurityNational Mortgage, has a line of credit with U.S Bank. This agreement with the bank allows SecurityNational Mortgage to borrow up to $100,000,000 for the sole purpose of funding mortgage loans. The agreement charges interest at the 1-Month LIBOR rate plus 2.0% and matures on June 4, 2022. The Company is required to comply with covenants for adjusted tangible net worth, unrestricted cash balance, and minimum combined pre-tax income (excluding any changes in the fair value of mortgage servicing rights) of at least $1.00 on a rolling twelve months.

The agreements for warehouse lines include cross default provisions in that a covenant violation under one agreement constitutes a covenant violation under the other agreement. As of December 31, 2021, the Company was in compliance with all debt covenants.

The following tabulation shows the combined maturities of bank and other loans payable:

2022	$	164,747,672
2023		1,745,541
2024		36,333,278
2025		2,512,683
2026		735,981
Thereafter		45,211,772
Total	$	251,286,927

Interest expense in 2021 and 2020 was $7,127,516 and $8,578,810, respectively. Interest paid in 2021 and 2020 was $7,290,867 and $8,385,270, respectively.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-URI http://asc.fasb.org/topic&trid=2208564

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

Property and Equipment

12 Months Ended

Dec. 31, 2021

Property, Plant and Equipment [Abstract]

Property and Equipment

6) Property and Equipment

Property and equipment is summarized below:

	2021			2020
	December 31
	2021			2020
Land and buildings	$	16,532,593		$	11,972,802
Furniture and equipment		24,799,115			19,679,682
Property, Plant and Equipment, Gross		41,331,708			31,652,484
Less accumulated depreciation		(19,814,110	)		(19,179,139	)
Total	$	21,517,598		$	12,473,345

Depreciation expense for the years ended December 31, 2021 and 2020 was $1,935,613 and $2,078,738, respectively. During 2021, the Company reclassified a building with a gross building cost of $3,640,755 with its associated accumulated depreciation of $532,074 from property and equipment to real estate held for investment. During 2020, the Company demolished a building with a gross building cost of $1,723,000 with its associated accumulated depreciation (net book value of $-0-) and transferred land with a cost of $1,516,700 to real estate held for investment to make way for phase 2 of the redevelopment and expansion of Center53. See Note 20 for additional information regarding property and equipment acquired through acquisitions.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

Schedule of Restricted Assets in Cemetery and Mortuary Endowment Care and Pre need Merchandise Funds (Details) - USD ($)

Dec. 31, 2021

Dec. 31, 2020

Dec. 31, 2019

Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items]

Cash and cash equivalents (1)

$ 141,414,282

$ 115,465,086

$ 137,735,673

Total

16,938,122

16,150,036

Restricted Assets [Member]

Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items]

Cash and cash equivalents (1)

^[1]

9,000,293

8,842,744

Fixed maturity securities, available for sale, at estimated fair value

1,601,688

1,473,637

Equity securities, at estimated fair value

3,603,822

2,515,778

Participating interests in mortgage loans held for investment with Security National Life

2,732,319

3,317,877

Total

$ 16,938,122

$ 16,150,036

[1]	Including cash and cash equivalents of $7,869,295 and $852,499 as of December 31, 2021 and 2020, respectively, for the life insurance and mortgage segments.

Cemetery Perpetual Care Trust Investments and Obligation and Restricted Assets (Details Narrative)	12 Months Ended
	Dec. 31, 2020 USD ($)
Security National Life Insurance [Member]
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items]
Proceeds from Sale and Collection of Notes Receivable	$ 4,000,000

Consolidated Statements of Cash Flows - USD ($)

12 Months Ended

Dec. 31, 2021

Dec. 31, 2020

Cash flows from operating activities:

Net earnings

$ 39,518,990

$ 55,596,613

Adjustments to reconcile net earnings to net cash used in operating activities:

Gains on investments and other assets

(6,265,134)

(1,925,850)

Other than temporary impairments on investments

39,502

370,975

Depreciation

5,540,672

5,447,363

Provision for loan losses and doubtful accounts

965,736

1,577,370

Net amortization of deferred fees and costs, premiums and discounts

(1,154,604)

(1,227,773)

Provision for deferred income taxes

11,308,436

2,854,669

Policy and pre-need acquisition costs deferred

(19,985,257)

(18,909,921)

Policy and pre-need acquisition costs amortized

15,027,841

13,520,600

Value of business acquired amortized

1,115,129

786,825

Mortgage servicing rights, additions

(32,701,819)

(29,896,465)

Amortization of mortgage servicing rights

^[1]

14,851,880

11,841,478

Stock based compensation expense

118,384

358,878

Benefit plans funded with treasury stock

6,007,402

3,939,948

Net change in fair value of loans held for sale

8,783,376

(10,413,492)

Originations of loans held for sale

(5,611,189,587)

(5,627,013,749)

Proceeds from sales of loans held for sale

5,900,076,766

5,600,045,285

Net gains on sales of loans held for sale

(177,876,915)

(188,893,379)

Change in assets and liabilities:

Land and improvements held for sale

441,839

758,514

Future policy benefits and unpaid claims

22,104,116

25,804,740

Other operating assets and liabilities

(32,088,511)

25,750,164

Net cash provided by (used in) operating activities

144,638,242

(129,627,207)

Cash flows from investing activities:

Purchases of fixed maturity securities

(18,857,131)

(58,493,147)

Sales, calls and maturities of fixed maturity securities

48,015,753

131,269,730

Purchase of equity securities

(1,950,554)

(6,991,832)

Sales of equity securities

3,868,061

3,902,835

Net changes in restricted assets

473,156

(1,954,437)

Net changes in cemetery perpetual care trust investments

(143,379)

(2,755,856)

Mortgage loans held for investment, other investments and policy loans made

(838,524,150)

(682,170,126)

Payments received for mortgage loans held for investment, other investments and policy loans

818,108,666

672,544,708

Purchases of property and equipment

(5,219,928)

(1,630,734)

Sales of property and equipment

194,955

Purchases of real estate

(92,403,534)

(40,190,471)

Sales of real estate

35,644,576

22,418,816

Cash paid for purchase of subsidiaries, net of cash acquired

(12,625,142)

Net cash provided by (used in) investing activities

(63,613,606)

36,144,441

Cash flows from financing activities:

Investment contract receipts

11,481,349

11,511,118

Investment contract withdrawals

(15,244,629)

(18,235,107)

Proceeds from stock options exercised

1,077,425

832,152

Purchase of treasury stock

(5,769,735)

(2,967,761)

Repayment of bank loans

(69,039,725)

(174,865,813)

Proceeds from bank loans

106,995,930

164,586,365

Net change in warehouse line borrowings for loans held for sale

(84,576,055)

90,351,225

Net cash provided by (used in) financing activities

(55,075,440)

71,212,179

Net change in cash, cash equivalents, restricted cash and restricted cash equivalents

25,949,196

(22,270,587)

Cash, cash equivalents, restricted cash and restricted cash equivalents at beginning of year

115,465,086

137,735,673

Cash, cash equivalents, restricted cash and restricted cash equivalents at end of year

141,414,282

115,465,086

Supplemental Disclosure of Cash Flow Information:

Interest (net of amount capitalized)

7,290,867

8,385,270

Income taxes

5,127,913

11,813,120

Non Cash Investing and Financing Activities:

Right-of-use assets obtained in exchange for operating lease liabilities

5,216,048

5,631,193

Accrued real estate construction costs and retainage

4,400,320

6,365,534

Transfer of property and equipment to real estate held for investment

3,108,681

1,516,700

Mortgage loans held for investment foreclosed into real estate held for investment

931,079

686,124

Transfer of loans held for sale to mortgage loans held for investment

201,951

16,960,549

Right-of-use assets obtained in exchange for finance lease liabilities

8,494

Cash and cash equivalents

131,354,470

106,219,429

Restricted assets

9,000,293

8,842,744

Cemetery perpetual care trust investments

$ 1,059,519

$ 402,913

[1]	Included in other expenses on the consolidated statements of earnings

Schedule of Liability for Future Policy Benefits, by Product Segment (Details) - USD ($)	Dec. 31, 2021	Dec. 31, 2020
Effects of Reinsurance [Line Items]
Gross future policy benefits and unpaid claims	$ 863,274,693	$ 844,790,087
Total receivable from reinsurers	14,850,608	15,569,156
Net future policy benefits and unpaid claims	848,424,085	829,220,931
Life Insurance Product Line [Member]
Effects of Reinsurance [Line Items]
Gross future policy benefits and unpaid claims	698,366,477	674,230,463
Total receivable from reinsurers	10,482,428	10,841,567
Fixed Annuity [Member]
Effects of Reinsurance [Line Items]
Gross future policy benefits and unpaid claims	107,992,830	109,522,112
Total receivable from reinsurers	4,082,877	4,047,301
Policyholder Account Balances [Member]
Effects of Reinsurance [Line Items]
Gross future policy benefits and unpaid claims	42,939,055	44,026,809
Accident and Health [Member]
Effects of Reinsurance [Line Items]
Gross future policy benefits and unpaid claims	629,302	651,140
Total receivable from reinsurers	88,474	90,231
Other Policyholder Funds [Member]
Effects of Reinsurance [Line Items]
Gross future policy benefits and unpaid claims	4,352,217	4,354,746
Reported But Unpaid Claims [Member]
Effects of Reinsurance [Line Items]
Gross future policy benefits and unpaid claims	4,887,934	8,689,723
Total receivable from reinsurers	177,829	571,057
Incurred But Not Reported Claims [Member]
Effects of Reinsurance [Line Items]
Gross future policy benefits and unpaid claims	4,106,878	3,315,094
Total receivable from reinsurers	$ 19,000	$ 19,000

Business Segment Information

12 Months Ended

Dec. 31, 2021

Segment Reporting [Abstract]

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.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

15) Business Segment Information (Continued)

	Year Ended December 31, 2021
	Life			Cemetery/						Intercompany
	Insurance			Mortuary			Mortgage			Eliminations			Consolidated
Revenues:
From external sources:
Revenue from customers	$	100,254,573		$	23,997,313		$	263,418,230			-		$	387,670,116
Net investment income		56,091,725			1,653,940			519,018			-			58,264,683
Gains on investments and other assets		4,554,528			1,511,965			198,641			-			6,265,134
Other than temporary impairments		(39,502	)		-			-			-			(39,502	)
Other revenues		2,152,531			100,255			16,282,325			-			18,535,111
Intersegment revenues:
Net investment income		7,569,875			314,001			599,115			(8,482,991	)		-
Total revenues		170,583,730			27,577,474			281,017,329			(8,482,991	)		470,695,542
Expenses:
Death, surrenders and other policy benefits		67,218,455			-			-			-			67,218,455
Increase in future policy benefits		26,263,312			-			-			-			26,263,312
Amortization of deferred policy and pre-need acquisition costs and value of business acquired		15,611,374			531,596			-			-			16,142,970
Selling, general and administrative expenses:
Commissions		3,514,498			1,917,899			112,854,072			-			118,286,469
Personnel		25,009,096			6,850,617			68,880,448			-			100,740,161
Advertising		1,160,640			570,924			4,894,854			-			6,626,418
Rent and rent related		733,726			109,318			6,399,243			-			7,242,287
Depreciation on property and equipment		806,543			479,005			650,065			-			1,935,613
Provision for loan loss reserve		-			-			-			-			-
Cost related to funding mortgage loans		-			-			10,541,570			-			10,541,570
Intersegment		497,113			113,062			671,107			(1,281,282	)		-
Other		12,075,374			5,224,178			35,766,430			-			53,065,982
Interest expense:
Intersegment		392,003			97,195			6,712,511			(7,201,709	)		-
Other		2,328,868			54,620			4,744,028			-			7,127,516
Costs of goods and services sold-mortuaries and cemeteries		-			3,704,014			-			-			3,704,014
Total benefits and expenses		155,611,002			19,652,428			252,114,328			(8,482,991	)		418,894,767
Earnings before income taxes	$	14,972,728		$	7,925,046		$	28,903,001		$	-		$	51,800,775
Income tax benefit (expense)		(2,943,715	)		(1,975,787	)		(7,362,283	)		-			(12,281,785	)
Net earnings	$	12,029,013		$	5,949,259		$	21,540,718		$	-		$	39,518,990

Identifiable assets	$	1,236,406,557		$	73,432,116		$	328,600,841		$	(96,099,992	)	$	1,542,339,522

Goodwill	$	2,765,570		$	2,488,213		$	-		$	-		$	5,253,783

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

15) Business Segment Information (Continued)

	Year Ended December 31, 2020
	Life			Cemetery/						Intercompany
	Insurance			Mortuary			Mortgage			Eliminations			Consolidated
Revenues:
From external sources:
Revenue from customers	$	93,020,617		$	20,307,435		$	298,933,110		$	-		$	412,261,162
Net investment income		54,811,486			807,695			710,622			-			56,329,803
Gains on investments and other assets		2,088,541			(162,652	)		(39	)		-			1,925,850
Other than temporary impairments		(370,975	)		-			-			-			(370,975	)
Other revenues		1,491,585			94,349			9,731,548			-			11,317,482
Intersegment revenues:
Net investment income		8,022,503			351,505			716,240			(9,090,248	)		-
Total revenues		159,063,757			21,398,332			310,091,481			(9,090,248	)		481,463,322
Expenses:
Death, surrenders and other policy benefits		62,841,360			-			-			-			62,841,360
Increase in future policy benefits		23,568,650			-			-			-			23,568,650
Amortization of deferred policy and pre-need acquisition costs and value of business acquired		13,618,204			689,221			-			-			14,307,425
Selling, general and administrative expenses:
Commissions		4,149,241			1,506,320			118,770,736			-			124,426,297
Personnel		25,449,100			5,669,367			53,871,504			-			84,989,971
Advertising		614,114			391,836			4,374,946			-			5,380,896
Rent and rent related		861,602			89,253			5,922,706			-			6,873,561
Depreciation on property and equipment		843,335			488,570			746,833			-			2,078,738
Provision for loan loss reserve		-			-			16,506,030			-			16,506,030
Cost related to funding mortgage loans		-			-			9,877,700			-			9,877,700
Intersegment		621,161			142,999			580,976			(1,345,136	)		-
Other		11,808,818			4,417,805			31,104,479			-			47,331,102
Interest expense:
Intersegment		410,024			152,175			7,182,913			(7,745,112	)		-
Other		2,354,760			198,968			6,025,082			-			8,578,810
Costs of goods and services sold-mortuaries and cemeteries		-			3,252,655			-			-			3,252,655
Total benefits and expenses		147,140,369			16,999,169			254,963,905			(9,090,248	)		410,013,195
Earnings before income taxes	$	11,923,388		$	4,399,163		$	55,127,576		$	-		$	71,450,127
Income tax benefit (expense)		(1,433,901	)		(1,009,137	)		(13,410,476	)		-			(15,853,514	)
Net earnings	$	10,489,487		$	3,390,026		$	41,717,100		$	-		$	55,596,613

Identifiable assets	$	1,171,158,235		$	56,335,498		$	408,325,196		$	(90,398,039	)	$	1,545,420,890

Goodwill	$	2,765,570		$	754,018		$	-		$	-		$	3,519,588

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

- 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/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 31
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8924-108599

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 34
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8981-108599

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 21
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8721-108599

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9031-108599

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (f)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9038-108599

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-Subparagraph (d)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
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-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8736-108599

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9054-108599

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8657-108599

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
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-Paragraph 21
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8721-108599

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-URI http://asc.fasb.org/topic&trid=2134510

+ Details

Leases (Tables)

12 Months Ended

Dec. 31, 2021

Leases

Schedule of Lease Cost Recognized in Earnings

	2021			2020
	Years Ended December 31
	2021			2020
Lease Cost
Finance lease cost:
Amortization of right-of-use assets (1)	$	41,925		$	58,576
Interest on lease liabilities (2)		4,713			7,341
Operating lease cost (3)		4,896,315			5,408,737
Short-term lease cost (3)(4)		167,551			222,311
Sublease income (3)		(275,038	)		(394,758	)
Total lease cost	$	4,835,466		$	5,302,207

Other Information
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	4,697,819		$	5,293,901
Operating cash flows from finance leases		4,713			7,341
Financing cash flows from finance leases		42,184			56,982

Right-of-use assets obtained in exchange for lease liabilities:
Operating leases	$	5,216,048		$	5,631,193
Finance leases		-			8,494

Weighted-average remaining lease term (in years)
Finance leases		2.07			2.74
Operating leases		6.04			5.40

Weighted-average discount rate
Finance leases		5.74	%		5.59	%
Operating leases		4.14	%		4.87	%

(1)

Included in Depreciation on property and equipment on the consolidated statements of earnings

(2)

Included in Interest expense on the consolidated statements of earnings

(3)

Included in Rent and rent related expenses on the consolidated statements of earnings

(4)

Includes leases with a term of 12 months or less

Schedule of Future Minimum Rental Payments for Finance Leases and Operating Leases

The following table presents the maturity analysis of the Company’s lease liabilities.

	Finance Leases			Operating Leases
Lease payments due in:
2022	$	34,458		$	4,109,174
2023		27,220			3,340,343
2024		4,354			2,707,152
2025		692			1,809,667
2026		-			1,414,296
Thereafter		-			2,449,017
Total undiscounted lease payments		66,724			15,829,649
Less: Discount on cash flows		(3,957	)		(2,889,958	)
Present value of lease liabilities	$	62,767		$	12,939,691

Schedule of Right-of-Use Assets and Lease Liabilities

The following table presents the Company’s right-of-use assets and lease liabilities.

		Year Ended December 31
	Balance Sheet Location	2021			2020
Operating Leases
Right-of-use assets	Other assets	$	12,483,638		$	11,663,245

Lease liabilities	Other liabilities and accrued expenses	$	12,939,691		$	11,921,884

Finance Leases
Right-of-use assets		$	235,867		$	254,276
Accumulated amortization			(177,660	)		(154,144	)
Right-of-use assets, net	Property and equipment, net	$	58,207		$	100,132

Lease liabilities	Bank and other loans payable	$	62,767		$	104,951

Schedule of Residential Real Estate Investment (Details) - USD ($)

12 Months Ended

Dec. 31, 2021

Dec. 31, 2020

Net Investment Income [Line Items]

Residential Real Estate Investment

$ 197,365,797

$ 131,684,453

Real Estate held for Sale

3,731,300

7,878,807

Residential Real Estate One [Member]

Net Investment Income [Line Items]

Real Estate held for Sale

1,190,602

3,478,254

UTAH | Residential Real Estate One [Member]

Net Investment Income [Line Items]

Real Estate held for Sale

1,744,292

UTAH | Land Developments [Member]

Net Investment Income [Line Items]

Residential Real Estate Investment

41,479,434

23,777,478

Lots available for sale

Lots to be developed

548

350

NEVADA | Residential Real Estate One [Member]

Net Investment Income [Line Items]

Real Estate held for Sale

979,640

TEXAS | Residential Real Estate One [Member]

Net Investment Income [Line Items]

Real Estate held for Sale

200,962

OHIO | Residential Real Estate One [Member]

Net Investment Income [Line Items]

Real Estate held for Sale

10,000

FLORIDA | Residential Real Estate One [Member]

Net Investment Income [Line Items]

Real Estate held for Sale

744,322

Residential Real Estate [Member]

Net Investment Income [Line Items]

Residential Real Estate Investment

41,972,462

24,843,743

Residential Real Estate [Member] | UTAH

Net Investment Income [Line Items]

Residential Real Estate Investment

^[1]

41,686,281

24,557,562

Residential Real Estate [Member] | WASHINGTON

Net Investment Income [Line Items]

Residential Real Estate Investment

^[2]

$ 286,181

[1]	Including subdivision land developments
[2]	Improved residential lots

Schedule of Gain (Loss) on Investments (Details) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Net Investment Income [Line Items]
Gross realized gains	$ 208,698	$ 358,236
Gross realized losses	(4,046)	(21,137)
Other than temporary impairments	(39,502)	(370,975)
Total	6,225,632	1,554,875
Fixed Maturity Securities [Member]
Net Investment Income [Line Items]
Gross realized gains	984,740	445,749
Gross realized losses	(139,728)	(77,546)
Equity Securities One [Member]
Net Investment Income [Line Items]
Gains on securities sold	390,597	74,836
Unrealized gains on securities held at the end of the period	2,732,130	1,125,304
Other Assets One [Member]
Net Investment Income [Line Items]
Gross realized gains	4,786,535	2,342,418
Gross realized losses	$ (2,489,140)	$ (1,984,911)

Retirement Plans

12 Months Ended

Dec. 31, 2021

Retirement Benefits [Abstract]

Retirement Plans

11) Retirement Plans

The Company and its subsidiaries had a noncontributory Employee Stock Ownership Plan (“ESOP”) for all eligible employees. Eligible employees are primarily those with more than one year of service, who work in excess of 1,000 hours per year. Contributions, which may be in cash or stock of the Company, are determined annually by the Board of Directors. The Company’s contributions are allocated to eligible employees based on the ratio of each eligible employee’s compensation to total compensation for all eligible employees during each year. The Company did not make any contributions for the years ended December 31, 2021 and 2020. On November 25, 2019, the Company distributed a notice of intent to terminate the ESOP Plan to all current plan participants. The Company also filed Form 5310 application for determination for terminating plan, with the IRS on December 6, 2019. As of the 4^th quarter of 2020, the Company began to distribute the ESOP Plan assets to participants that had made a distribution election. The Company received approval of its application from the IRS and distributed all the remaining ESOP Plan assets to the participants during 2021.

The Company has three 401(k) savings plans covering all eligible employees which includes employer participation in accordance with the provisions of Section 401(k) of the Internal Revenue Code. The plans allow participants to make pretax contributions up to a maximum of $19,500 and $19,500 for the years 2021 and 2020, respectively or the statutory limits. Beginning in January 2008, the Company elected to be a “Safe Harbor” Plan for its matching 401(k) contributions. The Company matched 100% of up to 3% of an employee’s total annual compensation and matched 50% of 4% to 5% of an employee’s annual compensation. The match was in Company stock. The Company’s contribution for the years ended December 31, 2021 and 2020 was $2,820,315 and $1,690,568, respectively under the “Safe Harbor” plan.

In 2001, the Company’s Board of Directors adopted a Non-Qualified Deferred Compensation Plan, and this plan was amended in 2005. Under the terms of the Plan, the Company will provide deferred compensation for a select group of management or highly compensated employees, within the meaning of Sections 201(2), 301(a)(3) and 401(a)(1) of the Employee Retirement Income Security Act of 1974, as amended. The Board has appointed a Committee of the Company to be the Plan Administrator and to determine the employees who are eligible to participate in the plan. The employees who participate may elect to defer a portion of their compensation into the plan. The Company may contribute into the plan at the discretion of the Company’s Board of Directors. The Company did not make any contributions for 2021 and 2020.

Effective December 4, 2018, the Board members approved a motion to extend the Chief Executive Officer’s employment agreement, dated December 4, 2012, for an additional four-year term ending December 2022. In the event of disability, the Chief Executive Officer’s salary would be continued for up to five years at 75% of its current level of compensation. In the event of a sale or merger of the Company and the Chief Executive Officer is not retained in his current position, the Company would be obligated to continue paying the Chief Executive Officer’s current compensation and benefits for seven years following the merger or sale. The agreement further provides that the Chief Executive Officer is entitled to receive annual retirement benefits beginning (i) one month from the date of his retirement (to commence no sooner than age 65), (ii) five years following complete disability, or (iii) upon termination of his employment without cause. These retirement benefits are to be paid for a period of twenty years in annual installments in the amount equal to 75% of his then current level of compensation. In the event that the Chief Executive Officer dies prior to receiving all retirement benefits thereunder, the remaining benefits are to be paid to his heirs. The Company expensed $900,000 and $900,000 during the years ended December 31, 2021 and 2020, respectively, to cover the present value of anticipated retirement benefits under the employment agreement. The liability accrued was $7,556,363 and $6,656,363 as of December 31, 2021 and 2020, respectively.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

11) Retirement Plans (Continued)

The Company, through its wholly owned subsidiary, SecurityNational Mortgage, also has an employment agreement with its former Vice President of Mortgage Operations and President of SecurityNational Mortgage, who retired from the Company on December 31, 2015. Under the terms of the employment agreement, this individual is entitled to receive retirement benefits from the Company for a period of ten years in an amount equal to 50% of his rate of compensation at the time of his retirement, which was $267,685 for the year ended December 31, 2015. Such retirement payments are paid monthly during the ten-year period. In the event that this individual dies prior to receiving all of his retirement benefits under his employment agreement, the remaining benefits will be made to his heirs. The company paid $133,843 and $133,843 in retirement compensation to this individual during the years ended December 31, 2021 and 2020, respectively. The liability accrued was $535,370 and $669,212 as of December 31, 2021 and 2020, respectively and is included in Other liabilities and accrued expenses on the consolidated balance sheets.

- Definition

The entire disclosure for retirement benefits.

+ References

Reference 1: http://www.xbrl.org/2003/role/exampleRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 715
-SubTopic 20
-Section 55
-Paragraph 17
-URI http://asc.fasb.org/extlink&oid=123450688&loc=d3e4179-114921

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
-Topic 715
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
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Reference 13: http://www.xbrl.org/2003/role/disclosureRef
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Reference 14: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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+ Details

Schedule of Value of Business Acquired (Details) (Parenthethical)	Dec. 31, 2021
Goodwill and Intangible Assets Disclosure [Abstract]
Debt instrument, interest rate, stated percentage	7.00%

Schedule of Fair Value of Fixed Maturity Securities (Details) - USD ($)	Dec. 31, 2021	Dec. 31, 2020
Marketable Securities [Line Items]
Available for Sale Securities, Unrealized Losses for Less than Twelve Months	$ 148,448	$ 510,379
Available for Sale Securities, Unrealized Losses for Less than Twelve Months Fair Value	13,122,225	13,581,684
Available for Sale Securities, Unrealized Losses for More than Twelve Months	368,541	439,466
Available for Sale Securities, Unrealized Losses for More than Twelve Months Fair Value	5,354,617	2,644,987
Available for Sale Securities, Unrealized Losses	516,989	949,845
Available for Sale Securities, Fair Value	18,476,842	16,226,671
US States and Political Subdivisions Debt Securities [Member]
Marketable Securities [Line Items]
Available for Sale Securities, Unrealized Losses for Less than Twelve Months	1,989	1,261
Available for Sale Securities, Unrealized Losses for Less than Twelve Months Fair Value	548,715	206,812
Available for Sale Securities, Unrealized Losses for More than Twelve Months
Available for Sale Securities, Unrealized Losses for More than Twelve Months Fair Value
Available for Sale Securities, Unrealized Losses	1,989	1,261
Available for Sale Securities, Fair Value	548,715	206,812
Corporate Securities [Member]
Marketable Securities [Line Items]
Available for Sale Securities, Unrealized Losses for Less than Twelve Months	73,507	242,596
Available for Sale Securities, Unrealized Losses for Less than Twelve Months Fair Value	4,638,750	9,919,298
Available for Sale Securities, Unrealized Losses for More than Twelve Months	280,161	438,882
Available for Sale Securities, Unrealized Losses for More than Twelve Months Fair Value	3,771,813	2,593,026
Available for Sale Securities, Unrealized Losses	353,668	681,478
Available for Sale Securities, Fair Value	8,410,563	12,512,324
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member]
Marketable Securities [Line Items]
Available for Sale Securities, Unrealized Losses for Less than Twelve Months	72,952	266,522
Available for Sale Securities, Unrealized Losses for Less than Twelve Months Fair Value	7,934,760	3,455,574
Available for Sale Securities, Unrealized Losses for More than Twelve Months	88,380	584
Available for Sale Securities, Unrealized Losses for More than Twelve Months Fair Value	1,582,804	51,961
Available for Sale Securities, Unrealized Losses	161,332	267,106
Available for Sale Securities, Fair Value	$ 9,517,564	$ 3,507,535

Schedule of Commercial Real Estate Investment (Details)

Dec. 31, 2021

USD ($)

ft²

Dec. 31, 2020

USD ($)

ft²

Net Investment Income [Line Items]

Real estate held for investment (net of accumulated depreciation)

$ 197,365,797

$ 131,684,453

Real estate held for sale

3,731,300

7,878,807

Commercial Real Estate One [Member]

Net Investment Income [Line Items]

Real estate held for investment (net of accumulated depreciation)

$ 155,393,335

$ 106,840,710

Total square footage | ft²

727,392

485,428

Real estate held for sale

$ 2,540,698

$ 4,400,553

Total square footage | ft²

225,551

234,979

UTAH | Commercial Real Estate One [Member]

Net Investment Income [Line Items]

Real estate held for investment (net of accumulated depreciation)

^[1]

$ 150,105,948

$ 100,927,528

Total square footage | ft²

^[1]

675,920

379,066

LOUISIANA | Commercial Real Estate One [Member]

Net Investment Income [Line Items]

Real estate held for investment (net of accumulated depreciation)

$ 2,426,612

$ 2,998,684

Total square footage | ft²

31,778

84,841

Real estate held for sale

$ 389,145

Total square footage | ft²

2,872

MISSISSIPPI | Commercial Real Estate One [Member]

Net Investment Income [Line Items]

Real estate held for investment (net of accumulated depreciation)

$ 2,860,775

$ 2,914,498

Total square footage | ft²

19,694

21,521

Real estate held for sale

$ 151,553

Total square footage | ft²

MISSISSIPPI | Commercial Real Estate 1 [Member]

Net Investment Income [Line Items]

Total square footage | ft²

12,300

KANSAS | Commercial Real Estate One [Member]

Net Investment Income [Line Items]

Real estate held for sale

$ 2,000,000

$ 4,000,000

Total square footage | ft²

222,679

TEXAS | Commercial Real Estate One [Member]

Net Investment Income [Line Items]

Real estate held for sale

^[2]

$ 249,000

Total square footage | ft²

^[2]

[1]	Includes Center53 phase 1 and phase 2
[2]	Approximately 93 acres of undeveloped land, in 2021, the existing building was removed

Reconciliation of Revenues from Cemetery and mortuary contracts to Business Segment Information (Details) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Revenue from Contract with Customer [Abstract]
Pre-need merchandise and services	$ 3,688,579	$ 3,601,638
At-need specialty merchandise	29,688	5,302
Pre-need land sales
Deferred policy and pre-need contract acquisition costs	$ 3,718,267	$ 3,606,940

Schedule of Mortgage Fee Income for Loans Held for Sale (Details) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Loans Held For Sale
Loan fees	$ 37,723,433	$ 43,432,532
Interest income	9,385,469	10,628,581
Secondary gains	230,417,029	231,759,342
Change in fair value of loan commitments	(3,113,095)	7,637,377
Change in fair value of loans held for sale	(8,783,376)	10,413,492
Provision for loan loss reserve	(2,211,230)	(4,938,214)
Mortgage fee income	$ 263,418,230	$ 298,933,110

Loans Held for Sale (Tables)

12 Months Ended

Dec. 31, 2021

Loans Held For Sale

Schedule of Aggregate Fair Value - Loans Held for Sale

The following table presents the aggregate fair value and the aggregate unpaid principal balance of loans held for sale.

	2021		2020
	December 31
	2021		2020
Aggregate fair value	$	302,776,827	$	422,772,418
Unpaid principal balance		294,481,503		406,407,323
Unrealized gain		8,295,324		16,365,095

Schedule of Mortgage Fee Income for Loans Held for Sale

Major categories of mortgage fee income for loans held for sale are summarized as follows:

	2021			2020
	Years Ended December 31
	2021			2020
Loan fees	$	37,723,433		$	43,432,532
Interest income		9,385,469			10,628,581
Secondary gains		230,417,029			231,759,342
Change in fair value of loan commitments		(3,113,095	)		7,637,377
Change in fair value of loans held for sale		(8,783,376	)		10,413,492
Provision for loan loss reserve		(2,211,230	)		(4,938,214	)
Mortgage fee income	$	263,418,230		$	298,933,110

Schedule of Loan Loss Reserve Included in Other Liabilities and Accrued Expenses

The loan loss reserve, which is included in other liabilities and accrued expenses, is summarized as follows:

	2021			2020
	December 31
	2021			2020
Balance, beginning of period	$	20,583,618		$	4,046,288
Provision for current loan originations (1)		2,211,230			4,938,214
Additional provision for loan loss reserve		-			16,506,030
Charge-offs, net of recaptured amounts		(20,347,709	)		(4,906,914	)
Balance, at December 31	$	2,447,139		$	20,583,618

(1) Included in Mortgage fee income

Schedule of Activity of Stock Option Plans (Details) (Parenthetical)	Dec. 31, 2021 $ / shares
Share-based Payment Arrangement [Abstract]
Stock price	$ 9.20

Schedule of Future Minimum Rental Payments for Finance Leases and Operating Leases (Details) - USD ($)	Dec. 31, 2021	Dec. 31, 2020
Leases
Finance Leases 2021	$ 34,458
Operating Leases 2021	4,109,174
Finance Leases 2022	27,220
Operating Leases 2022	3,340,343
Finance Leases 2023	4,354
Operating Leases 2023	2,707,152
Finance Leases 2024	692
Operating Leases 2024	1,809,667
Finance Leases 2025
Operating Leases 2025	1,414,296
Finance Leases Thereafter
Operating Leases Thereafter	2,449,017
Finance Leases Total undiscounted lease payments	66,724
Operating Leases Total undiscounted lease payments	15,829,649
Finance Leases Less: Discount on cash flows	(3,957)
Operating Leases Less: Discount on cash flows	(2,889,958)
Finance Leases Present value of lease liabilities	62,767	$ 104,951
Operating Leases Present value of lease liabilities	$ 12,939,691	$ 11,921,884

Mortgage Servicing Rights

12 Months Ended

Dec. 31, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

Mortgage Servicing Rights

21) Mortgage Servicing Rights

The Company reports MSRs pursuant to the accounting policy discussed in Note 1 of the Notes to Consolidated Financial Statements.

The following table presents the MSR activity.

Schedule of Mortgage Servicing Rights

	2021			2020
	December 31
	2021			2020
Amortized cost:
Balance before valuation allowance at beginning of year	$	35,210,516		$	17,155,529
MSR additions resulting from loan sales		32,701,819			29,896,465
Amortization (1)		(14,851,880	)		(11,841,478	)
Application of valuation allowance to write down MSRs with other than temporary impairment		-			-
Balance before valuation allowance at year end	$	53,060,455		$	35,210,516

Valuation allowance for impairment of MSRs:
Balance at beginning of year	$	-		$	-
Additions		-			-
Application of valuation allowance to write down MSRs with other than temporary impairment		-			-
Balance at year end	$	-		$	-

Mortgage servicing rights, net	$	53,060,455		$	35,210,516

Estimated fair value of MSRs at year end	$	68,811,809		$	38,702,358

(1)

Included in other expenses on the consolidated statements of earnings

The following table summarizes the Company’s estimate of future amortization of its existing MSRs carried at amortized cost. This projection was developed using the assumptions made by management in its December 31, 2021 valuation of MSRs. The assumptions underlying the following estimate will change as market conditions and portfolio composition and behavior change, causing both actual and projected amortization levels to change over time. Therefore, the following estimates will change in a manner and amount not presently determinable by management.

	Estimated MSR Amortization
2022	$	7,341,097
2023		6,020,240
2024		5,263,053
2025		4,583,231
2026		4,008,838
Thereafter		25,843,996
Total	$	53,060,455

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

21) Mortgage Servicing Rights (Continued)

The Company collected the following contractual servicing fee income and late fee income as reported in other revenues on the consolidated statements of earnings.

Schedule of Other Revenues

	Years Ended December 31
	2021		2020
Contractual servicing fees	$	15,471,307	$	8,940,612
Late fees		321,337		305,962
Total	$	15,792,644	$	9,246,574

The following is a summary of the unpaid principal balances (“UPB”) of the servicing portfolio.

	December 31
	2021		2020
Servicing UPB	$	7,060,536,350	$	5,070,287,864

The following key assumptions were used in determining MSR value.

Prepayment

Speeds

Average

Life(Years)

Discount

Rate

December 31, 2021

11.60

6.64

9.50

December 31, 2020

15.60

5.30

9.50

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

Capital Stock (Tables)

12 Months Ended

Dec. 31, 2021

Equity [Abstract]

Summary of Activities in Shares of Capital Stock

The following table summarizes the activity in shares of capital stock.

	Class A		Class C
Outstanding shares at December 31, 2019		16,107,779		2,500,887

Exercise of stock options		68,970		130,820
Stock dividends		405,210		61,720
Conversion of Class C to Class A		13,824		(13,824	)

Outstanding shares at December 31, 2020		16,595,783		2,679,603

Exercise of stock options		160,282		104,656
Stock dividends		837,410		131,553
Conversion of Class C to Class A		49,247		(49,247	)

Outstanding shares at December 31, 2021		17,642,722		2,866,565

Schedule of Earnings Per Share, Basic and Diluted

	2021		2020
	Years Ended December 31
	2021		2020
Numerator:
Net earnings	$	39,518,990	$	55,596,613

Denominator:
Denominator for basic earnings per share-weighted-average shares		20,154,878		19,788,984

Effect of dilutive securities
Employee stock options		774,206		465,423
Dilutive potential common shares		774,206		465,423

Denominator for diluted earnings per share-adjusted weighted-average
shares and assumed conversions		20,929,084		20,254,407

Basic earnings per share	$	1.96	$	2.81
Diluted earnings per share	$	1.89	$	2.74

Schedule of Statutory Accounting Practices (Details) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Liability for Catastrophe Claims [Line Items]
Statutory net income amount	$ 7,487,607	$ 8,417,824
Statutory capital and surplus, balance	82,812,168	78,493,142
Security National Life Insurance [Member]
Liability for Catastrophe Claims [Line Items]
Statutory net income amount	5,552,116	6,054,764
Statutory capital and surplus, balance	57,424,808	53,089,185
Kilpatrick Life Insurance Company [Member]
Liability for Catastrophe Claims [Line Items]
Statutory net income amount	1,312,718	1,574,128
Statutory capital and surplus, balance	15,566,231	15,177,996
First Guaranty Insurance Company [Member]
Liability for Catastrophe Claims [Line Items]
Statutory net income amount	624,550	790,221
Statutory capital and surplus, balance	7,734,357	7,045,644
Memorial Insurance Company of America [Member]
Liability for Catastrophe Claims [Line Items]
Statutory net income amount	37	55
Statutory capital and surplus, balance		1,088,034
Southern Security Life Insurance Company Inc [Member]
Liability for Catastrophe Claims [Line Items]
Statutory net income amount	275	183
Statutory capital and surplus, balance	1,578,225	1,581,647
Trans-Western Life Insurance Company [Member]
Liability for Catastrophe Claims [Line Items]
Statutory net income amount	(2,089)	(1,527)
Statutory capital and surplus, balance	$ 508,547	$ 510,636

Leases

12 Months Ended

Dec. 31, 2021

Leases

Leases

24) Leases

A lease is defined as a contract, or part of a contract, that conveys the right to control the use of identified property, plant, or equipment (an identified asset) for a period of time in exchange for consideration. The Company determines if a contract is a lease at the inception of the contract. At the commencement date of a lease, the Company measures the lease liability at the present value of the lease payments over the lease term, discounted using the discount rate for the lease. The Company uses the rate implicit in the lease, if available, otherwise the Company uses its incremental borrowing rate. Also, at the commencement date of a lease, the Company measures the cost of the related right-of-use asset which consists of the amount of the initial measurement of the lease liability, any lease payments made to the lessor at or before the commencement date, minus any lease incentives received and any initial direct costs incurred by the Company.

Information about the Nature of Leases and Subleases

The Company leases office space and equipment from third-parties under various non-cancelable agreements. The Company has operating leases for office space for its segments in areas where it conducts business. The Company subleases some of this office space. The Company also has finance leases for certain equipment, such as copy machines and postage machines. The Company does not have any lease agreements with variable lease payments. The Company has not included any options to extend or terminate leases in the recognition of the right-of-use assets or lease liabilities because of the uncertainty that they will be exercised. No residual value guarantees have been provided to the Company. The Company does not have any restrictions or covenants imposed by leases.

Leases that have not Commenced

The Company does not have any leases that have not commenced that create significant rights or obligations for the Company.

Related Party Lease Transactions

The Company does not have any related party lease transactions that require disclosure as of December 31, 2021.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

24) Leases (Continued)

Short-term Leases

The Company made an accounting policy election not to apply the recognition requirements of ASC 842 to short-term leases, which are leases that, at the commencement date, have a lease term of 12 months or less and do not include an option to purchase the underlying assets that the lessee is reasonably certain to exercise.

Significant Judgments and Assumptions

The Company does not use any significant judgments or assumptions regarding the determination of whether a contract contains a lease; the allocation of the consideration in a contract between lease and nonlease components; or the determination of the discount rates for the leases. The following table presents the Company’s total lease cost recognized in earnings, amounts capitalized as right-of- use assets and cash flows from lease transactions.

	2021			2020
	Years Ended December 31
	2021			2020
Lease Cost
Finance lease cost:
Amortization of right-of-use assets (1)	$	41,925		$	58,576
Interest on lease liabilities (2)		4,713			7,341
Operating lease cost (3)		4,896,315			5,408,737
Short-term lease cost (3)(4)		167,551			222,311
Sublease income (3)		(275,038	)		(394,758	)
Total lease cost	$	4,835,466		$	5,302,207

Other Information
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	4,697,819		$	5,293,901
Operating cash flows from finance leases		4,713			7,341
Financing cash flows from finance leases		42,184			56,982

Right-of-use assets obtained in exchange for lease liabilities:
Operating leases	$	5,216,048		$	5,631,193
Finance leases		-			8,494

Weighted-average remaining lease term (in years)
Finance leases		2.07			2.74
Operating leases		6.04			5.40

Weighted-average discount rate
Finance leases		5.74	%		5.59	%
Operating leases		4.14	%		4.87	%

(1)

Included in Depreciation on property and equipment on the consolidated statements of earnings

(2)

Included in Interest expense on the consolidated statements of earnings

(3)

Included in Rent and rent related expenses on the consolidated statements of earnings

(4)

Includes leases with a term of 12 months or less

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

24) Leases (Continued)

The following table presents the maturity analysis of the Company’s lease liabilities.

	Finance Leases			Operating Leases
Lease payments due in:
2022	$	34,458		$	4,109,174
2023		27,220			3,340,343
2024		4,354			2,707,152
2025		692			1,809,667
2026		-			1,414,296
Thereafter		-			2,449,017
Total undiscounted lease payments		66,724			15,829,649
Less: Discount on cash flows		(3,957	)		(2,889,958	)
Present value of lease liabilities	$	62,767		$	12,939,691

The following table presents the Company’s right-of-use assets and lease liabilities.

		Year Ended December 31
	Balance Sheet Location	2021			2020
Operating Leases
Right-of-use assets	Other assets	$	12,483,638		$	11,663,245

Lease liabilities	Other liabilities and accrued expenses	$	12,939,691		$	11,921,884

Finance Leases
Right-of-use assets		$	235,867		$	254,276
Accumulated amortization			(177,660	)		(154,144	)
Right-of-use assets, net	Property and equipment, net	$	58,207		$	100,132

Lease liabilities	Bank and other loans payable	$	62,767		$	104,951

The Company is also a lessor and has operating lease agreements with various tenants that lease its commercial and residential properties. See Note 2 for information about the Company’s real estate held for investment.

Schedule of Estimated Fair Values of Assets Acquired and Liabilities Assumed (Details) - Rivera Funerals Cremations and Memorial Gardens [Member]

12 Months Ended

Dec. 31, 2021

USD ($)

Business Acquisition [Line Items]

Restricted assets (1)

$ 618,006

^[1]

Property and equipment (2)

6,255,836

^[2]

Cemetery land and improvements

658,280

Goodwill

1,338,763

Other (3)

2,440,516

^[3]

Total assets acquired

11,311,401

Cemetery perpetual care obligation

(618,006)

Other liabilities - holdback

(1,120,000)

Total liabilities assumed

(1,738,006)

Fair value of net assets acquired/consideration paid

$ 9,573,395

[1]	Includes $39,000 of cash and $579,006 of fixed maturity securities, available for sale, at estimated fair value which is a Level 2 asset in the fair value hierarchy
[2]	At estimated fair value which is a Level 3 asset in the fair value hierarchy
[3]	Including $2,310,000 of intangible assets

Bank and Other Loans Payable (Tables)

12 Months Ended

Dec. 31, 2021

Debt Disclosure [Abstract]

Summary of Bank Loans Payable

Bank and other loans payable are summarized as follows:

Summary of Bank Loans Payable

	December 31
	2021		2020
		-		633,890

4.27% fixed note payable in monthly installments of $53,881 including principal and interest, collateralized by shares of Security National Life Insurance Company stock, paid in full December 2021.		-		633,890

Prime rate note payable in monthly installments of $75,108 including principal and interest, collateralized by shares of Security National Life Insurance Company stock, due December 2024.		2,481,878		3,257,113

4.329% fixed note payable in monthly installments of $9,775 including principal and interest, collateralized by real property with a book value of approximately $3,103,000, due September 2025.		1,825,608		1,861,920

4.00% variable with LIBOR at a 1% floor and a spread at 3% rate construction loan collateralized by real property with a book value of approximately $64,730,000, due March 2024.		34,547,181		-

2.5% above the monthly LIBOR rate plus 1/16th of the monthly LIBOR rate construction loan payable in monthly principal payments of $113,000 plus interest, collateralized by real property with a book value of approximately $49,118,000, paid in full March 2021.		-		35,091,364

3.30% fixed note payable in monthly installments of $179,562 including principal and interest, collateralized by real property with a book value of approximately $49,118,000, due April 2051.		40,090,359		-

4.7865% fixed interest only note payable in monthly installments, collateralized by real property with a book value of approximately $17,301,000, due June 2028.		9,200,000		9,200,000

1 month LIBOR rate plus 2.1% loan purchase agreement with a warehouse line availability of $100,000,000, matures June 2022.		66,305,025		116,598,834

1 month LIBOR rate plus 2% loan purchase agreement with a warehouse line availability of $100,000,000, matures August 2022.		50,555,909		68,766,572

1 month LIBOR rate plus 2.15% loan purchase agreement with a warehouse line availability of $75,000,000, matures May 2022.		43,196,986		60,715,374

1 month LIBOR rate plus 2.0% loan purchase agreement with a warehouse line availability of $100,000,000, matures June 2022.		1,764,386		-

1 month LIBOR rate plus 2.5% loan purchase agreement with a warehouse line availability of $5,000,000, matured August 2021.		-		317,582

Other short-term borrowings (1)		1,250,000		1,250,000

Finance lease liabilities		62,767		104,951

Other loans payable		6,828		26,768
Total bank and other loans		251,286,927		297,824,368

Less current installments		164,747,672		284,250,996
Bank and other loans, excluding current installments	$	86,539,255	$	13,573,372

Schedule of Combined Maturities of Bank Loans Payable, Lines of Credit and Notes and Contracts Payable

The following tabulation shows the combined maturities of bank and other loans payable:

2022	$	164,747,672
2023		1,745,541
2024		36,333,278
2025		2,512,683
2026		735,981
Thereafter		45,211,772
Total	$	251,286,927

Statutory Financial Information and Dividend Limitations (Details Narrative)	12 Months Ended
	Dec. 31, 2021 USD ($)
Liability for Catastrophe Claims [Line Items]
Cash dividend paid	$ 5,054,000
First Guaranty Insurance Company [Member]
Liability for Catastrophe Claims [Line Items]
Cash dividend paid	605,000
Kilpatrick Life Insurance Company [Member]
Liability for Catastrophe Claims [Line Items]
Cash dividend paid	$ 950,000

Schedule of Lease Cost Recognized in Earnings (Details) - USD ($)

12 Months Ended

Dec. 31, 2021

Dec. 31, 2020

Leases

Amortization of right-of-use assets (1)

$ 41,925

$ 58,576

Interest on lease liabilities (2)

^[1]

4,713

7,341

Operating lease cost (3)

^[2]

4,896,315

5,408,737

Short-term lease cost (3)(4)

^[2],[3]

167,551

222,311

Sublease income (3)

^[2]

(275,038)

(394,758)

Total lease cost

4,835,466

5,302,207

Operating cash flows from operating leases

4,697,819

5,293,901

Operating cash flows from finance leases

4,713

7,341

Financing cash flows from finance leases

42,184

56,982

Operating leases

5,216,048

5,631,193

Finance leases

$ 8,494

Finance lease, Weighted-average remaining lease term (in years)

2 years 25 days

2 years 8 months 26 days

Operating lease, Weighted-average remaining lease term (in years)

6 years 14 days

5 years 4 months 24 days

Finance lease, Weighted-average discount rate

5.74%

5.59%

Operating lease, Weighted-average discount rate

4.14%

4.87%

[1]	Included in Interest expense on the consolidated statements of earnings
[2]	Included in Rent and rent related expenses on the consolidated statements of earnings
[3]	Includes leases with a term of 12 months or less

Investments

12 Months Ended

Dec. 31, 2021

Investments, Debt and Equity Securities [Abstract]

Investments

2) Investments

The Company’s investments as of December 31, 2021 are summarized as follows:

Schedule of Investments

	Amortized Cost			Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
December 31, 2021:
Fixed maturity securities, available for sale, at estimated fair value:
U.S. Treasury securities and obligations of U.S. Government agencies	$	22,307,736		$	578,567	$	-		$	22,886,303

Obligations of states and political subdivisions		4,649,917			212,803		(1,989	)		4,860,731

Corporate securities including public utilities		174,711,061			21,791,370		(353,668	)		196,148,763

Mortgage-backed securities		34,365,382			905,159		(161,332	)		35,109,209

Redeemable preferred stock		269,214			13,383		-			282,597

Total fixed maturity securities available for sale	$	236,303,310		$	23,501,282	$	(516,989	)	$	259,287,603

Equity securities at estimated fair value:

Common stock:

Industrial, miscellaneous and all other	$	8,275,772		$	3,626,444	$	(305,802	)	$	11,596,414

Total equity securities at estimated fair value	$	8,275,772		$	3,626,444	$	(305,802	)	$	11,596,414

Mortgage loans held for investment at amortized cost:
Residential	$	53,533,712
Residential construction		175,117,783
Commercial		51,683,022
Less: Unamortized deferred loan fees, net		(918,586	)
Less: Allowance for loan losses		(1,699,902	)
Less: Net discounts		(409,983	)

Total mortgage loans held for investment	$	277,306,046

Real estate held for investment - net of accumulated depreciation:
Residential	$	41,972,462
Commercial		155,393,335

Total real estate held for investment	$	197,365,797

Real estate held for sale:
Residential	$	1,190,602
Commercial		2,540,698

Total real estate held for sale	$	3,731,300

Other investments and policy loans at amortized cost:
Policy loans	$	13,478,214
Insurance assignments		48,632,808
Federal Home Loan Bank stock (1)		2,547,100
Other investments		4,983,251
Less: Allowance for doubtful accounts		(1,686,218	)

Total policy loans and other investments	$	67,955,155

Accrued investment income	$	6,313,012

Total investments	$	823,555,327

(1)	Includes $905,700 of Membership stock and $1,641,400 of Activity stock due to short-term advances and letters of credit.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

2) Investments (Continued)

The Company’s investments as of December 31, 2020 are summarized as follows:

	Amortized Cost			Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
December 31, 2020:
Fixed maturity securities, available for sale, at estimated fair value:
U.S. Treasury securities and obligations of U.S. Government agencies	$	42,381,805		$	1,358,562	$	-		$	43,740,367

Obligations of states and political subdivisions		5,383,762			312,214		(1,261	)		5,694,715

Corporate securities including public utilities		186,067,912			27,216,496		(681,478	)		212,602,930

Mortgage-backed securities		31,047,791			1,565,377		(267,106	)		32,346,062

Redeemable preferred stock		269,214			3,391		-			272,605

Total fixed maturity securities available for sale	$	265,150,484		$	30,456,040	$	(949,845	)	$	294,656,679

Equity securities at estimated fair value:

Common stock:

Industrial, miscellaneous and all other	$	9,698,490		$	2,376,156	$	(750,407	)	$	11,324,239

Total equity securities at estimated fair value	$	9,698,490		$	2,376,156	$	(750,407	)	$	11,324,239

Mortgage loans held for investment at amortized cost:
Residential	$	95,822,448
Residential construction		111,111,777
Commercial		46,836,866
Less: Unamortized deferred loan fees, net		(1,161,132	)
Less: Allowance for loan losses		(2,005,127	)
Less: Net discounts		(1,260,896	)

Total mortgage loans held for investment	$	249,343,936

Real estate held for investment - net of accumulated depreciation:
Residential	$	24,843,743
Commercial		106,840,710

Total real estate held for investment	$	131,684,453

Real estate held for sale:
Residential	$	3,478,254
Commercial		4,400,553

Total real estate held for sale	$	7,878,807

Other investments and policy loans at amortized cost:
Policy loans	$	14,171,589
Insurance assignments		53,231,131
Federal Home Loan Bank stock (1)		2,506,600
Other investments		5,432,816
Less: Allowance for doubtful accounts		(1,645,475	)

Total policy loans and other investments	$	73,696,661

Accrued investment income	$	5,360,523

Total investments	$	773,945,298

(1)	Includes $866,900 of Membership stock and $1,639,700 of Activity stock due to short-term advances and letters of credit.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

2) Investments (Continued)

Fixed Maturity Securities

	Unrealized Losses for Less than Twelve Months		Fair Value		Unrealized Losses for More than Twelve Months		Fair Value		Total Unrealized Loss		Fair Value
At December 31, 2021
Obligations of States and Political Subdivisions	$	1,989	$	548,715	$	-	$	-	$	1,989	$	548,715
Corporate Securities		73,507		4,638,750		280,161		3,771,813		353,668		8,410,563
Mortgage and other asset-backed securities		72,952		7,934,760		88,380		1,582,804		161,332		9,517,564
Total unrealized losses	$	148,448	$	13,122,225	$	368,541	$	5,354,617	$	516,989	$	18,476,842

At December 31, 2020
Obligations of States and Political Subdivisions	$	1,261	$	206,812	$	-	$	-	$	1,261	$	206,812
Corporate Securities		242,596		9,919,298		438,882		2,593,026		681,478		12,512,324
Mortgage and other asset-backed securities		266,522		3,455,574		584		51,961		267,106		3,507,535
Total unrealized losses	$	510,379	$	13,581,684	$	439,466	$	2,644,987	$	949,845	$	16,226,671

There were 55 securities with fair value of 97.3% of amortized cost at December 31, 2021. There were 63 securities with fair value of 94.7% of amortized cost at December 31, 2020. Credit losses of $39,502 and $370,975 have been recognized for the years ended December 31, 2021 and 2020, respectively.

On a quarterly basis, the Company evaluates its fixed maturity securities classified as available for sale. This evaluation includes a review of current ratings by the National Association of Insurance Commissions (“NAIC”). Securities with a rating of 1 or 2 are considered investment grade and are not reviewed for impairment, unless current market or recent company news could lead to a credit downgrade. Securities with ratings of 3 to 5 are evaluated for impairment. Securities with a rating of 6 are automatically determined to be impaired and are written down. The evaluation involves an analysis of the securities in relation to historical values, interest payment history, projected earnings and revenue growth rates as well as a review of the reason for a downgrade in the NAIC rating. Based on the analysis of a security that is rated 3 to 5, a determination is made whether the security will likely make interest and principal payments in accordance with the terms of the financial instrument. If it is unlikely that the security will meet contractual obligations, the loss is considered to be other than temporary, the security is written down to the new anticipated market value and an impairment loss is recognized.

The fair values of fixed maturity securities are based on quoted market prices, when available. For fixed maturity securities not actively traded, fair values are estimated using values obtained from independent pricing services, or in the case of private placements, are estimated by discounting expected future cash flows using a current market value applicable to the coupon rate, credit and maturity of the investments.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

2) Investments (Continued)

The following table presents a rollforward of the Company’s cumulative other than temporary credit impairments (“OTTI”) recognized in earnings on fixed maturity securities available for sale.

	2021			2020
Balance of credit-related OTTI at January 1	$	370,975		$	-

Additions for credit impairments recognized on:
Securities not previously impaired		39,502			370,975
Securities previously impaired		-			-

Reductions for credit impairments previously recognized on:
Securities that matured or were sold during the period (realized)		(145,500	)		-
Securities due to an increase in expected cash flows		-			-

Balance of credit-related OTTI at December 31	$	264,977		$	370,975

	Amortized		Estimated Fair
	Cost		Value
Due in 1 year	$	68,966	$	70,024
Due in 2-5 years		62,958,696		65,605,915
Due in 5-10 years		70,740,783		77,346,448
Due in more than 10 years		67,900,269		80,873,410
Mortgage-backed securities		34,365,382		35,109,209
Redeemable preferred stock		269,214		282,597
Total	$	236,303,310	$	259,287,603

The Company is a member of the Federal Home Loan Bank of Des Moines and Dallas (“FHLB”). The Company pledged a total of $28,993,126, at estimated fair value, of fixed maturity securities with the FHLB at December 31, 2021. These securities are used as collateral on any cash borrowings from the FHLB. As of December 31, 2021, the Company owed $-0- to the FHLB and its estimated maximum borrowing capacity was $27,054,347.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

2) Investments (Continued)

Investment Related Earnings

Schedule of Gain (Loss) on Investments


	Years Ended December 31
	2021			2020
Fixed maturity securities available for sale:
Gross realized gains	$	984,740		$	445,749
Gross realized losses		(139,728	)		(77,546	)
Other than temporary impairments		(39,502	)		(370,975	)

Equity securities:
Gains on securities sold		390,597			74,836
Unrealized gains on securities held at the end of the period		2,732,130			1,125,304

Other assets:
Gross realized gains		4,786,535			2,342,418
Gross realized losses		(2,489,140	)		(1,984,911	)
Total	$	6,225,632		$	1,554,875

The net realized gains and losses on the sale of securities are recorded on the trade date, and the cost of the securities sold is determined using the specific identification method.

Information regarding sales of fixed maturity securities available for sale is presented as follows.


	Years Ended December 31
	2021			2020
Proceeds from sales	$	2,896,351		$	5,477,438
Gross realized gains		208,698			358,236
Gross realized losses		(4,046	)		(21,137	)

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

2) Investments (Continued)

Major categories of net investment income were as follows:


	Years Ended December 31
	2021			2020
Fixed maturity securities available for sale	$	10,769,979		$	12,233,394
Equity securities		446,337			642,433
Mortgage loans held for investment		28,758,614			25,672,746
Real estate held for investment and sale		12,334,989			11,945,401
Policy loans		940,890			1,025,179
Insurance assignments		19,062,052			17,837,578
Other investments		131,145			126,013
Cash and cash equivalents		235,470			426,623
Gross investment income		72,679,476			69,909,367
Investment expenses		(14,414,793	)		(13,579,564	)
Net investment income	$	58,264,683		$	56,329,803

Net investment income includes income earned by the restricted assets of the cemeteries and mortuaries of $1,472,295 and $676,313 for the years ended December 31, 2021 and 2020, respectively.

Net investment income on real estate consists primarily of rental revenue.

Investment expenses consist primarily of depreciation, property taxes, operating expenses of real estate and an estimated portion of administrative expenses relating to investment activities.

Securities on deposit for regulatory authorities as required by law amounted to $101,681,853 and $9,684,409 at December 31, 2021 and 2020, respectively. The restricted securities are included in various assets under investments on the accompanying consolidated balance sheets.

There were no investments, aggregated by issuer, in excess of 10% of shareholders’ equity (before net unrealized gains and losses) at December 31, 2021, other than investments issued or guaranteed by the United States Government.

Real Estate Held for Investment and Held for Sale

The Company strategically deploys resources into real estate to match the income and yield durations of its primary obligations. The sources for these real estate assets come through its various business segments in the form of acquisition, development and mortgage foreclosures. The Company reports real estate held for investment and held for sale pursuant to the accounting policy discussed in Note 1 of the Notes to Consolidated Financial Statements.

Commercial Real Estate Held for Investment and Held for Sale

The Company owns and manages commercial real estate assets as a means of generating investment income. These assets are acquired in accordance with the Company’s goals and objectives for risk-adjusted returns. Due diligence is conducted on each asset using internal and third-party reports. Geographic locations and asset classes of the investment activity is determined by senior management under the direction of the Board of Directors.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

2) Investments (Continued)

The Company employs full-time employees to attend to the day-to-day operations of those assets within the greater Salt Lake area and close surrounding markets. The Company utilizes third-party property managers when the geographic boundary does not warrant full-time staff or through strategic lease-up periods. The Company generally looks to acquire assets in regions that are high growth regions for employment and population and assets that provide operational efficiencies.

The Company currently owns and operates 11 commercial properties in 5 states. These properties include office buildings, flex office space, and includes the redevelopment and expansion of its corporate campus (“Center53”) in Salt Lake City, Utah. The Company does use debt in strategic cases to leverage established yields or to acquire a higher quality or different class of asset.

The aggregated net ending balance of commercial real estate that serves as collateral for bank loans was $134,251,205 and $71,517,902 as of December 31, 2021 and 2020, respectively. The associated bank loan carrying values totaled $85,663,148 and $46,153,283 as of December 31, 2021 and 2020, respectively.

During the years ended December 31, 2021 and 2020, the Company recorded impairment losses on commercial real estate held for sale of $2,028,378 and $897,980, respectively. These impairment losses relate to a funeral home and an office building held by the life insurance segment. The funeral home was subsequently sold. Impairment losses are included in gains (losses) on investments and other assets on the consolidated statements of earnings.

The Company’s commercial real estate held for investment is summarized as follows:

	Net Ending Balance				Total Square Footage
	December 31				December 31
	2021		2020		2021		2020
Utah (1)	$	150,105,948	$	100,927,528		675,920		379,066
Louisiana		2,426,612		2,998,684		31,778		84,841
Mississippi		2,860,775		2,914,498		19,694		21,521

	$	155,393,335	$	106,840,710		727,392		485,428

(1)	Includes Center53 phase 1 and phase 2

The Company’s commercial real estate held for sale is summarized as follows:

	Net Ending Balance				Total Square Footage
	December 31				December 31
	2021		2020		2021		2020
Kansas	$	2,000,000	$	4,000,000		222,679		222,679
Louisiana		389,145		-		2,872		-
Mississippi (1)		151,553		151,553		-		12,300
Texas (2)				249,000		-		-

	$	2,540,698	$	4,400,553		225,551		234,979

(1)	Approximately 93 acres of undeveloped land, in 2021, the existing building was removed

(2)	Improved commercial pad

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

2) Investments (Continued)

These properties are all actively being marketed with the assistance of commercial real estate brokers in the markets where the properties are located. The Company expects these properties to sell within the coming 12 months.

Residential Real Estate Held for Investment and Held for Sale

The Company owns a small portfolio of residential homes primarily as a result of loan foreclosures. The Company has the option to sell them or to continue to hold them for cash flow and acceptable returns. The Company also invests in residential subdivision land developments.

The Company established Security National Real Estate Services (“SNRE”) to manage the residential portfolio. SNRE cultivates and maintains the preferred vendor relationships necessary to manage costs and quality of work performed on the portfolio of homes across the country.

During the years ended December 31, 2021 and 2020, the Company recorded impairment losses on residential real estate held for sale of $-0- and $43,394, respectively. These impairment losses are included in gains (losses) on investments and other assets on the consolidated statements of earnings.

The net ending balance of foreclosed residential real estate included in residential real estate held for investment or sale is $1,190,602 and $4,327,079 as of December 31, 2021 and 2020, respectively.

The Company’s residential real estate held for investment is summarized as follows:


	Net Ending Balance
	December 31
	2021		2020
Utah (1)	$	41,686,281	$	24,557,562
Washington (2)		286,181		286,181
Residential Real Estate Investment	$	41,972,462	$	24,843,743

(1)	Including subdivision land developments

(2)	Improved residential lots

The following table presents additional information regarding the Company’s subdivision land developments in Utah.


	December 31
	2021		2020
Lots available for sale		67		36
Lots to be developed		548		350
Ending Balance	$	41,479,434	$	23,777,478
Residential Real Estate Investment	$	41,479,434	$	23,777,478

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

2) Investments (Continued)

The Company’s residential real estate held for sale is summarized as follows:


	Net Ending Balance
	December 31
	2021		2020
Nevada	$	979,640	$	979,640
Texas		200,962		-
Ohio		10,000		10,000
Florida		-		744,322
Utah		-		1,744,292
Real Estate held for Sale	$	1,190,602	$	3,478,254

These properties are all actively being marketed with the assistance of residential real estate brokers in the markets where the properties are located. The Company expects these properties to sell within the coming 12 months.

Real Estate Owned and Occupied by the Company

Location	Business Segment	Approximate Square Footage		Square Footage Occupied by the Company
433 West Ascension Way, Salt Lake City, UT - Center53 Phase 2	Corporate Offices, Life Insurance, Cemetery/Mortuary Operations, and Mortgage Operations and Sales		221,000		50	%
1044 River Oaks Dr., Flowood, MS	Life Insurance Operations		19,694		28	%
1818 Marshall Street, Shreveport, LA (1)	Life Insurance Operations		12,274		100	%
909 Foisy Street, Alexandria, LA (1)	Life Insurance Sales		8,059		100	%
812 Sheppard Street, Minden, LA (1)	Life Insurance Sales		1,560		100	%
1550 N 3rd Street, Jena, LA (1)	Life Insurance Sales		1,737		100	%

(1)	Included in property and equipment on the consolidated balance sheets

Mortgage Loans Held for Investment

The Company reports mortgage loans held for investment pursuant to the accounting policy discussed in Note 1 of the Notes to Consolidated Financial Statements.

Mortgage loans consist of first and second mortgages. The mortgage loans bear interest at rates ranging from 2.0 % to 10.5%, maturity dates range from nine months to 30 years and are secured by real estate. Concentrations of credit risk arise when a number of mortgage loan debtors have similar economic characteristics that would cause their ability to meet contractual obligations to be similarly affected by changes in economic conditions. Although the Company has a diversified mortgage loan portfolio consisting of residential mortgages, commercial loans and residential construction loans and requires collateral on all real estate exposures, a substantial portion of its debtors’ ability to honor obligations is reliant on the economic stability of the geographic region in which the debtors do business. At December 31, 2021, the Company had 70%, 7%, 5%, 4%, 4% and 2% of its mortgage loans from borrowers located in the states of Utah, Florida, California, Texas, Nevada and Arizona, respectively. At December 31, 2020, the Company had 57%, 13%, 9%, 4%, 3% and 3% of its mortgage loans from borrowers located in the states of Utah, Florida, Texas, California, Nevada and Arizona, respectively.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

2) Investments (Continued)

	Commercial		Residential			Residential Construction		Total
December 31, 2021
Allowance for credit losses:
Beginning balance	$	187,129	$	1,774,796		$	43,202	$	2,005,127
Charge-offs		-		-			-		-
Provision		-		(305,225	)		-		(305,225	)
Ending balance	$	187,129	$	1,469,571		$	43,202	$	1,699,902

Ending balance: individually evaluated for impairment	$	-	$	105,384		$	-	$	105,384

Ending balance: collectively evaluated for impairment	$	187,129	$	1,364,187		$	43,202	$	1,594,518

Mortgage loans:
Ending balance	$	51,683,022	$	53,533,712		$	175,117,783	$	280,334,517

Ending balance: individually evaluated for impairment	$	1,723,372	$	2,548,656		$	-	$	4,272,028

Ending balance: collectively evaluated for impairment	$	49,959,650	$	50,985,056		$	175,117,783	$	2,760,162,489

December 31, 2020
Allowance for credit losses:
Beginning balance	$	187,129	$	1,222,706		$	43,202	$	1,453,037
Charge-offs		-		-			-		-
Provision		-		552,090			-		552,090
Ending balance	$	187,129	$	1,774,796		$	43,202	$	2,005,127

Ending balance: individually evaluated for impairment	$	-	$	219,905		$	-	$	219,905

Ending balance: collectively evaluated for impairment	$	187,129	$	1,554,891		$	43,202	$	1,785,222

Mortgage loans:
Ending balance	$	46,836,866	$	111,111,777		$	95,822,448	$	253,771,091

Ending balance: individually evaluated for impairment	$	2,148,827	$	7,932,680		$	200,963	$	10,282,470

Ending balance: collectively evaluated for impairment	$	44,688,039	$	103,179,097		$	95,621,485	$	243,488,621

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

2) Investments (Continued)

The following table presents the aging of mortgage loans held for investment.

Schedule of Aging of Mortgage Loans

	Commercial			Residential			Residential Construction			Total
December 31, 2021
30-59 Days Past Due	$	-		$	3,117,826		$	1,363,127		$	4,480,953
60-89 Days Past Due		100,204			580,815			-			681,019
Greater Than 90 Days (1)		1,723,372			2,052,062			-			3,775,434
In Process of Foreclosure (1)		-			496,594			-			496,594
Total Past Due		1,823,576			6,247,297			1,363,127			9,434,000
Current		49,859,446			47,286,415			173,754,656			270,900,517
Total Mortgage Loans		51,683,022			53,533,712			175,117,783			280,334,517
Allowance for Loan Losses		(187,129	)		(1,469,571	)		(43,202	)		(1,699,902	)
Unamortized deferred loan fees, net		(36,813	)		(498,600	)		(383,173	)		(918,586	)
Unamortized discounts, net		(240,614	)		(169,369	)		-			(409,983	)
Net Mortgage Loans	$	51,218,466		$	51,396,172		$	174,691,408		$	277,306,046

December 31, 2020
30-59 Days Past Due	$	233,200		$	5,866,505		$	127,191		$	6,226,896
60-89 Days Past Due		812,780			2,048,148			-			2,860,928
Greater Than 90 Days (1)		2,148,827			5,669,583			-			7,818,410
In Process of Foreclosure (1)		-			2,263,097			200,963			2,464,060
Total Past Due		3,194,807			15,847,333			328,154			19,370,294
Current		43,642,059			79,975,115			110,783,623			234,400,797
Total Mortgage Loans		46,836,866			95,822,448			111,111,777			253,771,091
Allowance for Loan Losses		(187,129	)		(1,774,796	)		(43,202	)		(2,005,127	)
Unamortized deferred loan fees, net		(32,557	)		(909,864	)		(218,711	)		(1,161,132	)
Unamortized discounts, net		(880,721	)		(380,175	)		-			(1,260,896	)
Net Mortgage Loans	$	45,736,459		$	92,757,613		$	110,849,864		$	249,343,936

(1)

Interest income is not recognized on loans past due greater than 90 days or in foreclosure.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

2) Investments (Continued)

Impaired Mortgage Loans Held for Investment

Impaired mortgage loans held for investment include loans with a related specific valuation allowance or loans whose carrying amount has been reduced to the expected collectible amount because the impairment has been considered other than temporary. The recorded investment in and unpaid principal balance of impaired loans along with the related loan specific allowance for losses, if any, for each reporting period and the average recorded investment and interest income recognized during the time the loans were impaired are summarized as follows:

Schedule of Impaired Mortgage Loans

	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
December 31, 2021
With no related allowance recorded:
Commercial	$	1,723,372	$	1,723,372	$	-	$	1,053,865	$	-
Residential		1,591,368		1,591,368		-		2,731,421		-
Residential construction		-		-		-		100,481		-

With an allowance recorded:
Commercial	$	-	$	-	$	-	$	-	$	-
Residential		957,288		957,288		105,384		726,449		-
Residential construction		-		-		-		-		-

Total:
Commercial	$	1,723,372	$	1,723,372	$	-	$	1,053,865	$	-
Residential		2,548,656		2,548,656		105,384		3,457,870		-
Residential construction		-		-		-		100,481		-

December 31, 2020
With no related allowance recorded:
Commercial	$	2,148,827	$	2,148,827	$	-	$	1,866,819	$	-
Residential		6,415,419		6,415,419		-		5,010,078		-
Residential construction		200,963		200,963		-		555,278		-

With an allowance recorded:
Commercial	$	-	$	-	$	-	$	-	$	-
Residential		1,517,261		1,517,261		219,905		1,182,368		-
Residential construction		-		-		-		-		-

Total:
Commercial	$	2,148,827	$	2,148,827	$	-	$	1,866,819	$	-
Residential		7,932,680		7,932,680		219,905		6,192,446		-
Residential construction		200,963		200,963		-		555,278		-

Credit Risk Profile Based on Performance Status

The Company’s mortgage loan held for investment portfolio is monitored based on performance of the loans. Monitoring a mortgage loan increases when the loan is delinquent or earlier if there is an indication of impairment. The Company defines non-performing mortgage loans as loans 90 days or greater delinquent or on non-accrual status.

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

2) Investments (Continued)

The Company’s performing and non-performing mortgage loans held for investment are summarized as follows:

	Commercial				Residential				Residential Construction				Total
	December 31				December 31				December 31				December 31
	2021		2020		2021		2020		2021		2020		2021		2020

Performing	$	49,959,650	$	44,688,039	$	50,985,056	$	87,889,768	$	175,117,783	$	110,910,814	$	276,062,489	$	243,488,621
Non-performing		1,723,372		2,148,827		2,548,656		7,932,680		-		200,963		4,272,028		10,282,470

Total	$	51,683,022	$	46,836,866	$	53,533,712	$	95,822,448	$	175,117,783	$	111,111,777	$	280,334,517	$	253,771,091

Non-Accrual Mortgage Loans Held for Investment

Once a loan is past due 90 days, it is the policy of the Company to end the accrual of interest income on the loan and write off any income that had been accrued. Payments received for loans on a non-accrual status are recognized on a cash basis. Interest income recognized from any payments received for loans on a non-accrual status was immaterial. Accrual of interest resumes if a loan is brought current. Interest not accrued on these loans totals approximately $236,000 and $491,000 as of December 31, 2021 and 2020, respectively.

Principal Amounts Due

The following table presents the amortized cost and contractual payments on mortgage loans held for investment by category as of December 31, 2021. Expected principal payments may differ from contractual obligations because certain borrowers may elect to pay off mortgage obligations with or without early payment penalties.

			Principal		Principal		Principal
			Amounts		Amounts		Amounts
			Due in		Due in		Due
	Total		1 Year		2-5 Years		Thereafter
Residential	$	53,533,712	$	7,451,252	$	6,031,628	$	40,050,832
Residential Construction		175,117,783		145,711,262		29,406,521		-
Commercial		51,683,022		17,007,282		25,761,914		8,913,826
Total	$	280,334,517	$	170,169,796	$	61,200,063	$	48,964,658

SECURITY NATIONAL FINANCIAL CORPORATION

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years Ended December 31, 2021 and 2020

Schedule of Changes in the Consolidated Balance Sheet Line Items Measured Using Level 3 Inputs (Details) - USD ($)

12 Months Ended

Dec. 31, 2021

Dec. 31, 2020

Net Derivatives Loan Commitments [Member]

Subsidiary, Sale of Stock [Line Items]

Fair value balance

$ 10,128,610

$ 2,491,233

Originations and purchases

Sales, maturities and paydowns

Transfer to mortgage loans held for investment

Total gains (losses) included in earnings

(3,113,095)

^[1]

7,637,377

^[2]

Total gains (losses) included in other comprehensive income

Fair value balance

7,015,515

10,128,610

Loans Held For Sale [Member]

Subsidiary, Sale of Stock [Line Items]

Fair value balance

422,772,418

213,457,632

Originations and purchases

5,611,189,587

5,627,013,749

Sales, maturities and paydowns

(5,900,076,766)

(5,600,045,285)

Transfer to mortgage loans held for investment

(201,951)

(16,960,549)

Total gains (losses) included in earnings

169,093,539

^[1]

199,306,871

^[2]

Total gains (losses) included in other comprehensive income

Fair value balance

302,776,827

422,772,418

Fixed Maturity Securities Available For Sale [Member]

Subsidiary, Sale of Stock [Line Items]

Fair value balance

2,201,175

3,216,382

Originations and purchases

Sales, maturities and paydowns

(45,700)

(1,042,400)

Transfer to mortgage loans held for investment

Total gains (losses) included in earnings

3,674

^[3]

3,408

^[4]

Total gains (losses) included in other comprehensive income

(135,801)

23,785

Fair value balance

$ 2,023,348

$ 2,201,175

[1]	As a component of mortgage fee income on the consolidated statements of earnings
[2]	As a component of mortgage fee income on the consolidated statements of earnings
[3]	As a component of net investment income on the consolidated statements of earnings
[4]	As a component of net investment income on the consolidated statements of earnings

Schedule of Property, Plant and Equipment (Details) - USD ($)	Dec. 31, 2021	Dec. 31, 2020
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Gross	$ 41,331,708	$ 31,652,484
Less accumulated depreciation	(19,814,110)	(19,179,139)
Total	21,517,598	12,473,345
Land and Building [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Gross	16,532,593	11,972,802
Furniture and Fixtures [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Gross	$ 24,799,115	$ 19,679,682