Business Segments

9 Months Ended

Sep. 30, 2020

Segment Reporting [Abstract]

Business Segments

Business Segments

The Company has three reportable segments: temporary and consultant staffing, permanent placement staffing, and risk consulting and internal audit services. Operating segments are defined as components of the Company for which separate financial information is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and assess performance. The temporary and consultant staffing segment provides specialized staffing in the accounting and finance, administrative and office, information technology, legal, advertising, marketing and web design fields. The permanent placement staffing segment provides full-time personnel in the accounting, finance, administrative and office, and information technology fields. The risk consulting and internal audit services segment provides business and technology risk consulting and internal audit services.

The accounting policies of the segments are set forth in Note A—“Summary of Significant Accounting Policies” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019. The Company evaluates performance based on income before net interest income, intangible assets amortization expense, and income taxes.

The following table provides a reconciliation of service revenues and segment income by reportable segment to consolidated results for the three and nine months ended September 30, 2020 and 2019 (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
Service revenues
Temporary and consultant staffing	$	781,391	$	1,118,461	$	2,626,897	$	3,305,800
Permanent placement staffing	87,203		134,582		278,722		407,038
Risk consulting and internal audit services	321,303		299,089		899,295		824,209
	$	1,189,897	$	1,552,132	$	3,804,914	$	4,537,047
Segment income
Temporary and consultant staffing	$	43,779	$	101,428	$	165,933	$	312,684
Permanent placement staffing	10,128		21,817		20,791		68,718
Risk consulting and internal audit services	48,735		39,646		105,311		87,120
Combined segment income	102,642		162,891		292,035		468,522
Amortization of intangible assets	334		339		1,002		1,022
Interest income, net	(202)		(1,230)		(1,264)		(3,768)
Income before income taxes	$	102,510	$	163,782	$	292,297	$	471,268

Service revenues presented above are shown net of eliminations of intersegment revenues. Intersegment revenues between temporary and consulting staffing segment and risk consulting and internal audit services segment were $59.8 million and $147.6 million for the three and nine months ended September 30, 2020, respectively, and $46.5 million and $121.6 million for the three and nine months ended September 30, 2019, respectively.