Page 11 - CNB Bank Shares 2018 Annual Report

CNB BANK SHARES, INC. AND SUBSIDIARIES

Consolidated Balance Sheets

December 31, 2018 and 2017

Independent Auditors’ Report ASSETS 2018 2017
Cash and due from banks (note 2) $ 14,066,757 32,216,948
Interest-earning deposits in other financial institutions 66,244,670 22,238,980
The Board of Directors Investments in available-for-sale debt and equity securities (note 3) 214,937,311 148,895,251
CNB Bank Shares, Inc.: Mortgage loans held for sale 442,000 469,180
Loans (notes 4 and 9) 943,908,478 716,150,270
Report on the Consolidated Financial Statements Less:
Deferred loan fees, net of related costs (672,993) (515,184)
We have audited the accompanying consolidated financial statements of CNB Bank Shares, Inc. and subsidiaries, Unamortized discount on purchased loans (1,830,680) −
which comprise the consolidated balance sheets as of December 31, 2018 and 2017, and the related consolidated Reserve for possible loan losses (10,382,768) (8,579,439)
statements of income, comprehensive income, stockholders’ equity, and cash flows for the years then ended, and the Net loans 931,022,037 707,055,647
related notes to the consolidated financial statements. Bank premises and equipment, net (note 5) 16,967,116 13,157,360
Accrued interest receivable 9,333,717 6,971,229
Management’s Responsibility for the Consolidated Financial Statements Bank-owned life insurance policies (note 12) 12,422,272 4,901,869
Identifiable intangible assets, net of accumulated amortization of
Management is responsible for the preparation and fair presentation of these consolidated financial statements in $6,900,493 and $5,471,974 at December 31, 2018 and 2017, respectively 5,426,582 753,816
accordance with accounting principles generally accepted in the United States of America; this includes the design, Goodwill 21,415,712 4,526,325
implementation, and maintenance of internal control relevant to the preparation and fair presentation of consolidated Other assets (note 7) 15,525,407 4,685,030
financial statements that are free from material misstatement, whether due to fraud or error. $ 1,307,803,581 945,871,635

Auditor’s Responsibility
LIABILITIES AND STOCKHOLDERS’ EQUITY
Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We
conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those Deposits (note 6):
standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated Noninterest-bearing $ 185,714,853 132,666,564
financial statements are free from material misstatement. Interest-bearing 930,382,704 688,017,673
Total deposits 1,116,097,557 820,684,237
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the Short-term borrowings (note 8) 25,029,171 15,173,266
consolidated financial statements. The procedures selected depend on the auditor’s judgment, including the Accrued interest payable 1,724,579 1,056,947
assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or Federal Home Loan Bank borrowings (note 9) 21,666,069 16,507,690
error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and Notes payable (note 10) 7,546,925 1,846,925
fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate in the Other liabilities (note 12) 16,077,794 6,922,172
circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Total liabilities 1,188,142,095 862,191,237
Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies Commitments and contingencies (notes 13 and 15)
used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall Stockholders’ equity (notes 11, 14, and 16):
presentation of the consolidated financial statements. Preferred stock and related surplus, $0.01 par value; 200,000 shares
authorized, 9,745 shares issued at December 31, 2018 19,352,310 −
We believe that the audit evidence we obtained is sufficient and appropriate to provide a basis for our audit opinion. Common stock, $0.05 par value; 20,000,000 shares authorized,
5,779,659 and 5,254,200 shares issued and outstanding
Opinion at December 31, 2018 and 2017, respectively 288,983 262,710
Surplus 19,499,123 8,929,106
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the Retained earnings 87,128,813 79,966,720
financial position of CNB Bank Shares, Inc. and subsidiaries as of December 31, 2018 and 2017, and the results of Treasury stock, at cost – 450,707 and 476,320 shares at December 31, 2018
their operations and their cash flows for the years then ended in accordance with accounting principles generally and 2017, respectively (5,524,609) (5,265,582)
accepted in the United States of America. Accumulated other comprehensive income (loss) – net unrealized
holding losses on available-for-sale securities (1,083,134) (212,556)
Total stockholders’ equity 119,661,486 83,680,398
$ 1,307,803,581 945,871,635

St. Louis, Missouri See accompanying notes to consolidated financial statements.
February 19, 2019 ANNUAL REPOR T 2018 9