Exhibit 15 

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To:

The Board of Directors of 1^st Franklin Financial Corporation

We have audited the consolidated financial statements of 1^st Franklin Financial Corporation and subsidiaries (the “Company”) as of December 31, 2009 and 2008, and for each of the three years in the period ended December 31, 2009, and have issued our report thereon dated March 30, 2010; such consolidated financial statements and report are included in your 2009 Annual Report to Investors and are incorporated herein by reference.  Our audits also included the financial statement schedule of the Company listed in Item 15.  The financial statement schedule is the responsibility of the Company’s management.  Our responsibility is to express an opinion based on our audits.  In our opinion, such financial statement schedule, when considered in relation to the basic consolidated financial statements taken as a whole, presents fairly, in all material respects, the information set forth therein.

/s/ DELOITTE & TOUCHE LLP

Atlanta, Georgia

March 30, 2010

SCHEDULE I

CONDENSED FINANCIAL INFORMATION OF REGISTRANT

1^st FRANKLIN FINANCIAL CORPORATION

(Parent Company Only)

DECEMBER 31, 2009 AND 2008

ASSETS

2009    

  2008    

CASH AND CASH EQUIVALENTS:

   Cash and Due From Banks

$

3,510,146

$

396,752

LOANS:

   Direct Cash Loans

327.424,876

324.996,394

   Real Estate Loans

24,336,405

24,175,593

   Sales Finance Contracts

23,071,118

27,586,508

374,832,399

376,758,495

   Less:

Unearned Finance Charges

43,331,239

44,032,487

Unearned Insurance Commissions

12,376,214

12,465,624

Allowance for Loan Losses

26,610,085

23,010,085

292,514,861

297,250,299

INVESTMENTS IN SUBSIDIARIES

84,850,301

75,844,337

MARKETABLE DEBT SECURITIES:

   Available for Sale, at fair market value

402,526

373,774

OTHER ASSETS:

   Land, Buildings, Equipment and Leasehold Improvements,

      less accumulated depreciation and amortization

         of $15,724,169 and $13,653,028 in 2009

         and 2008, respectively

7,626,510

9,241,725

   Miscellaneous

2,782,863

3,198,218

10,409,373

12,439,943

                TOTAL ASSETS

$

391,687,207

$

386,305,105

SCHEDULE I

CONDENSED FINANCIAL INFORMATION OF REGISTRANT

1^st FRANKLIN FINANCIAL CORPORATION

(Parent Company Only)

DECEMBER 31, 2009 AND 2008

LIABILITIES AND STOCKHOLDERS' EQUITY

2009

 2008

SENIOR DEBT:

   Notes Payable to Banks

$

 16,204,309

$

 22,267,681

   Senior Demand Notes, including accrued interest

 41,209,099

 41,341,839

   Commercial Paper

129,435,443

106,062,799

186,848,851

169,672,319

ACCOUNTS PAYABLE AND ACCRUED EXPENSES

14,264,100

13,980,948

SUBORDINATED DEBT

74,883,979

86,605,009

        Total Liabilities

275,996,930

270,258,276

STOCKHOLDERS' EQUITY:

   Preferred Stock; $100 par value

6,000 shares authorized; no shares issued or outstanding

--

--

   Common Stock:

Voting Shares; $100 par value;

2,000 shares authorized; 1,700 shares issued and

outstanding as of December 31, 2009 and 2008

170,000

170,000

Non-Voting Shares; no par value;

198,000 shares authorized; 168,300 shares issued and

outstanding as of December 31, 2009 and 2008

--

--

   Accumulated Other Comprehensive Income

272,210

243,458

   Retained Earnings

115,248,067

115,633,371

               Total Stockholders' Equity

115,690,277

116,046,829

                    TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$

391,687,207

$

386,305,105

SCHEDULE I

CONDENSED FINANCIAL INFORMATION OF REGISTRANT

1^st FRANKLIN FINANCIAL CORPORATION

(Parent Company Only)

STATEMENTS OF INCOME

FOR THE YEARS ENDED DECEMBER 31, 2009, 2008 AND 2007

2009

2008

2007

INTEREST INCOME:

Finance Charges

$

96,494,760 

$

94,434,623 

$

87,164,381 

Investment Income

15,089 

26,302 

21,189 

96,509,849 

94,460,925 

87,185,570 

INTEREST EXPENSE:

Senior Debt

8,745,154 

8,333,678 

10,158,113 

Subordinated Debt

4,936,793 

6,393,999 

5,587,502 

13,681,947 

14,727,677 

15,745,615 

NET INTEREST INCOME

82,827,902 

79,733,248 

71,439,955 

PROVISION FOR LOAN LOSSES

29,302,142 

25,725,394 

21,433,742 

NET INTEREST INCOME AFTER

PROVISION FOR LOAN LOSSES

53,525,760 

54,007,854 

50,006,213 

NET INSURANCE INCOME

16,773,235 

16,823,210 

16,298,194 

OTHER REVENUE

5,223,733 

5,301,054 

5,069,095 

OPERATING EXPENSES:

Personnel Expense

48,366,010 

46,830,271 

42,798,905 

Occupancy Expense

11,186,780 

10,653,752 

9,778,649 

Other Expense

16,455,343 

17,545,462 

16,375,184 

76,008,133 

75,029,485 

68,952,738 

INCOME (LOSS) BEFORE INCOME

TAXES AND EQUITY IN EARNINGS

OF SUBSIDIARIES

(485,405)

1,102,633 

2,420,764 

PROVISION FOR INCOME TAXES

11,081 

11,713 

28,965 

EQUITY IN EARNINGS OF

SUBSIDIARIES, Net of Tax

8,869,493 

9,573,856 

9,812,964 

NET INCOME

8,373,007 

10,664,776 

12,204,763 

RETAINED EARNINGS, Beginning of Period

115,633,371 

108,699,923 

97,950,753 

Distributions on Common Stock

8,758,311 

3,731,328 

1,455,593 

RETAINED EARNINGS, End of Period

$

115,248,067 

$

115,633,371 

$

108,699,923 

SCHEDULE I

1^st FRANKLIN FINANCIAL CORPORATION

(Parent Company Only)

STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED DECEMBER 31, 2009, 2008 AND 2007

2009     

2008    

2007     

   Net Income

$

8,373,007 

$

10,664,776 

$

12,204,763 

   Adjustments to reconcile net income to net

       cash provided by operating activities:

    Provision for Loan Losses

29,302,142 

25,725,394 

21,433,742 

    Depreciation and Amortization

2,577,539 

2,447,007 

2,076,784 

    Equity in undistributed earnings of subsidiaries

(8,834,493)

19,343,979 

(9,795,963)

    Gain on sale of marketable securities and

       equipment and premium amortization on securities

(18,572)

(10,185)

(37)

    Decrease (Increase) in Miscellaneous Assets

415,355 

(409,987)

460,355   

    Increase (Decrease) in Other Liabilities

283,152 

(1,418,796)

2,253,485 

          Net Cash Provided

32,098,130 

56,342,188 

28,633,129 

CASH FLOWS FROM INVESTING ACTIVITIES:

   Loans originated or purchased

(214,933,802)

(236,634,867)

(250,121,741)

   Loan payments

190,367,098 

201,549,309 

200,622,963 

   Purchase of joint venture interest

(171,471)

--  

--  

   Capital expenditures

(997,083)

(2,777,574)

(4,383,965)

   Proceeds from sale of equipment

53,331 

25,234 

443,450 

          Net Cash Used

(25,681,927)

(37,837,898)

(53,439,293)

CASH FLOWS FROM FINANCING ACTIVITIES:

   Net decrease in Senior Demand Notes

(132,740)

(7,268,898)

(241,074)

   Advances on credit line

90,246,309 

103,563,000 

89,345,000 

   Payments on credit line

(96,309,681)

(97,980,000)

(97,488,000)

   Commercial Paper issued

396,342,906 

35,766,727 

33,538,927 

   Commercial Paper redeemed

(372,970,262)

(46,781,459)

(24,256,208)

   Subordinated Debt issued

11,623,006 

21,619,938 

36,790,393 

   Subordinated Debt redeemed

(23,344,036)

(26,980,643)

(12,014,336)

   Dividends / Distributions Paid

(8,758,311)

(3,731,328)

(1,455,593)

          Net Cash (Used) Provided

(3,302,809)

(21,792,663)

24,219,109 

NET INCREASE (DECREASE) IN

     CASH AND CASH EQUIVALENTS

3,113,394    

(3,288,373)  

(587,055)  

CASH AND CASH EQUIVALENTS, beginning

396,752 

3,685,125 

4,272,180 

CASH AND CASH EQUIVALENTS, ending

$

3,510,146 

$

396,752 

$

3,685,125 

Cash paid during the year for:

Interest

$

13,607,180 

$

14,830,353 

$

15,667,174 

Income Taxes

11,415 

10,700 

41,910