Company: FRME
Filing Date: 2025-02-24
Form Type: 10-K
Source: 0000712534-25-000058
Chunk: 18

Company: FIRST MERCHANTS CORP
Filing Date: 2025-02-24
Form: 10-K
Item: Item 8
Chunk 18
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 and liabilities related to the plans.  Key factors include assumptions on the expected rates of return on plan assets, discount rates and health care costs and trends.  The Corporation considers market conditions, including changes in investment returns and interest rates in making these assumptions.  The primary assumptions used in determining the Corporation’s pension and post retirement benefit obligations and related expenses are presented in NOTE 18. PENSION AND OTHER POST RETIREMENT BENEFIT PLANS of these Notes to Consolidated Financial Statements.PREMISES AND EQUIPMENT Premises and equipment is carried at cost net of accumulated depreciation.  Depreciation is computed using the straight-line and declining balance methods based on the estimated useful lives of the assets ranging from three to forty years.  Maintenance and repairs are expensed as incurred, while major additions and improvements, which extend the useful life, are capitalized.  Gains and losses on dispositions are included in current operations.  Details of the Corporation’s premises and equipment are included in NOTE 6. PREMISES AND EQUIPMENT of these Notes to Consolidated Financial Statements.LEASESThe Corporation leases certain land and premises from third parties and all are classified as operating leases.  Operating leases are included in Other Assets and Other Liabilities on the Corporation’s Consolidated Balance Sheets and lease expense for lease payments is recognized on a straight-line basis over the lease term.  Right of Use (“ROU”) assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the term.  An ROU asset represents the right to use the underlying asset for the lease term and also includes any direct costs and payments made prior to lease commencement and excludes lease incentives.  When an implicit rate is not available, an incremental borrowing rate based on the information available at commencement date is used in determining the present value of the lease payments.  A lease term may include an option to extend or terminate the lease when it is reasonably certain the option will be exercised.  Short-term leases of twelve months or less are excluded from accounting guidance; as a result, the lease payments are recognized on a straight-line basis over the lease term and the leases are not reflected on the Corporation’s Consolidated Balance Sheets.  Renewal and termination options are considered when determining short-term leases.  Leases are accounted for at the individual level.  Details of the Corporation’s leases are included in NOTE 8. LEASES of these Notes to Consolidated Financial Statements.QUALIFIED AFFORDABLE HOUSING INVESTMENTSQualified affordable