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H&R Block, Inc. | 2016 Form 10-K 49
NOTE 5: MORTGAGE LOANS HELD FOR INVESTMENT
The composition of our mortgage loan portfolio is as follows:
(dollars in 000s)
As of April 30, 2016 2015
Amount % of Total Amount % of Total
Adjustable-rate loans $ 108,251 52% $ 130,182 53%
Fixed-rate loans 97,957 48% 115,034 47%
206,208 100% 245,216 100%
Unamortized deferred fees and costs 1,695 2,008
Less: Allowance for loan losses (5,518) (7,886)
$ 202,385 $ 239,338
Our loan loss allowance as a percent of mortgage loans was 2.7% and 3.2% as of April 30, 2016 and 2015,
respectively.
Activity in the allowance for loan losses for the years ended April 30, 2016, 2015 and 2014 is as follows:
(in 000s)
Year ended April 30, 2016 2015 2014
Balance as of the beginning of the year $ 7,886 $ 11,272 $ 14,314
Provision (1,173) (10) 8,271
Recoveries 1,797 1,393 4,040
Charge-offs (2,992) (4,769) (15,353)
Balance as of the end of the year $ 5,518 $ 7,886 $ 11,272
Detail of the aging of the mortgage loans in our portfolio as of April 30, 2016 is as follows:
(in 000s)
Less than 60
Days Past Due
60 – 89 Days
Past Due
90+ Days
Past Due(1) Total
Past Due Current Total
Purchased from SCC $ 9,775 $ 376 $ 40,987 $ 51,138 $ 70,906 $ 122,044
All other 2,315 131 5,878 8,324 75,840 84,164
$ 12,090 $ 507 $ 46,865 $ 59,462 $ 146,746 $ 206,208
(1) We do not accrue interest on loans past due 90 days or more.
NOTE 6: PROPERTY AND EQUIPMENT
The components of property and equipment, net of accumulated depreciation and amortization, are as follows:
(in 000s)
As of April 30, 2016 2015
Buildings $ 76,289 $ 88,273
Computers and other equipment 128,815 140,636
Leasehold improvements 77,712 68,114
Purchased software 9,126 12,741
Land and other non-depreciable assets 1,623 1,623
$ 293,565 $ 311,387
Depreciation and amortization expense of property and equipment for continuing operations for fiscal years 2016,
2015 and 2014 was $100.8 million, $101.3 million and $84.7 million, respectively.