| YEAR ENDED DECEMBER 31, | |||
| 1999 | 1998 | ||
| CASH FLOWS FROM OPERATING ACTIVITIES | |||
| Net income | $ 1,174,415 | $ -- | |
| Add (deduct) items not affecting cash: | |||
| Policyholder dividend-issuance of Class B stock | -- | 5,027,303 | |
| Realized losses (gains) on sales of securities | 99,065 | (975,941) | |
| Net amortization of bond premiums and discounts | 44,258 | 42,331 | |
| Changes in assets and liabilities: | |||
| Premiums receivable | (7,540) | 52,835 | |
| Reinsurance receivable | (2,079,544) | 863,782 | |
| Prepaid reinsurance premiums | 120,025 | (4,964) | |
| Accrued interest | 12,572 | (24,593) | |
| Deferred policy acquisition costs | (2,232) | (404) | |
| Other assets | (97,823) | (2,840) | |
| Losses and loss adjustment expenses | 4,038,380 | (2,976,856) | |
| Losses payable | -- | (100,000) | |
| Unearned premiums | (49,888) | 7,397 | |
| Reinsurance balances payable | 320,492 | 556,765 | |
| Premium taxes payable | 36,211 | (12,443) | |
| Unearned ceding commissions | (12,849) | 490 | |
| Other liabilities | 52,794 | 16,659 | |
| NET CASH PROVIDED BY OPERATING ACTIVITIES | 3,648,336 | 2,469,521 | |
| CASH FLOWS FROM INVESTING ACTIVITIES | ||
| Purchases of investments | (9,483,295) | (7,770,543) |
| Proceeds from sales of investments | 7,311,767 | 5,893,154 |
| NET CASH USED IN INVESTING ACTIVITIES | (2,171,528) | (1,877,389) |
| CASH FLOWS FROM FINANCING ACTIVITIES | ||
| Capital contributions | 129,250 | 235,424 |
| Stock repurchase | (1,459,574) | (1,417,743) |
| NET CASH USED IN FINANCING ACTIVITIES | (1,330,324) | (1,182,319) |
| NET CHANGE IN CASH AND CASH EQUIVALENTS | 146,484 | (590,187) |
| CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR | 2,700,640 | 3,290,827 |
| CASH AND CASH EQUIVALENTS, END OF YEAR | $2,847,124 | $2,700,640 |
| President's Message |
Independent Accountants |
Balance Sheets |
Income & Comprehensive Income |
Changes in Shareholders' Equity |
Cash Flows |