Fdsexecdefcimp 2

SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
 
 

FORM 11-K
 

[X]     ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
           SECURITIES AND EXCHANGE ACT OF 1934
 

            For fiscal year ended December 31, 2004
 

[  ]     TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE
          SECURITIES EXCHANGE ACT OF 1934
 

          For the transition period from        to       
 
 

Commission file number: 1-13536
 

     A.     Full title of the plan and the address of the plan, if different from that of the issuer named below: Executive Deferred Compensation Plan of Federated Department Stores, Inc.
 

     B.     Name of issuer of the securities held pursuant to the plan and the address of its principal executive office:
 

Federated Department Stores, Inc.
7 West Seventh Street
Cincinnati, Ohio 45202

and

151 West 34th Street
New York, New York 10001

 

EXECUTIVE DEFERRED COMPENSATION PLAN OF

FEDERATED DEPARTMENT STORES, INC.

Financial Statements

As of December 31, 2004 and 2003 and for

the Years Ended December 31, 2004, 2003 and 2002
 

With Independent Auditors' Report Thereon
 

 

EXECUTIVE DEFERRED COMPENSATION PLAN OF

FEDERATED DEPARTMENT STORES, INC.
 

Index
 

Report of Independent Registered Public Accounting Firm
 

Statements of Assets Available for Plan Benefits -

    December 31, 2004 and 2003
 

Statements of Changes in Assets Available for Plan Benefits -

    Years Ended December 31, 2004, 2003 and 2002
 

Notes to Financial Statements
 

 

Report of Independent Registered Public Accounting Firm
 

The Pension and Profit Sharing Committee

Federated Department Stores, Inc.:
 

We have audited the accompanying statements of assets available for plan benefits of the Executive Deferred Compensation Plan of Federated Department Stores, Inc. (the Plan) as of December 31, 2004 and 2003, and the related statements of changes in assets available for plan benefits for each of the years in the three-year period ended December 31, 2004. These financial statements are the responsibility of the Plan's management. Our responsibility is to express an opinion on these financial statements based on our audits.
 

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
 

In our opinion, the financial statements referred to above present fairly, in all material respects, the assets available for plan benefits of the Plan as of December 31, 2004 and 2003, and the changes in assets available for plan benefits for each of the years in the three-year period ended December 31, 2004, in conformity with U.S. generally accepted accounting principles.
 

KPMG LLP
 

Cincinnati, Ohio

March 28, 2005

 

EXECUTIVE DEFERRED COMPENSATION PLAN OF

FEDERATED DEPARTMENT STORES, INC.
 

Statements of Assets Available for Plan Benefits
 

December 31, 2004 and 2003
 
 

    2004    

    2003    
     

Receivables from Federated Department Stores, Inc. -
      Cash Credits


$23,291,122


$20,424,617
     

Federated Department Stores, Inc. common stock -
      Stock Credits


29,847,090


24,262,760
     

Assets available for plan benefits

$53,138,212

$44,687,377
     

The accompanying notes are an integral part of these financial statements.

 

EXECUTIVE DEFERRED COMPENSATION PLAN OF

FEDERATED DEPARTMENT STORES, INC.
 

Statement of Changes in Assets Available for Plan Benefits
 

Year Ended December 31, 2004
 
 

Cash
  Credits  

Stock
  Credits  


  Total  
       

Interest income

$     725,012

$              -

$    725,012
       

Dividend income

-

265,075

265,075
       

Unrealized appreciation on Federated Department
      Stores, Inc. common stock


-


5,482,331


5,482,331
       

Participant contributions

3,340,250

1,042,072

4,382,322
       

      Total additions

4,065,262

6,789,478

10,854,740
       

Distributions

1,198,757

1,205,148

2,403,905
       

Net additions to assets available for plan benefits

2,866,505

5,584,330

8,450,835
       

Assets available for plan benefits:

      

   Beginning of year

20,424,617

24,262,760

44,687,377

   End of year

$23,291,122

$29,847,090

$53,138,212
       

The accompanying notes are an integral part of these financial statements.

 

EXECUTIVE DEFERRED COMPENSATION PLAN OF

FEDERATED DEPARTMENT STORES, INC.
 

Statement of Changes in Assets Available for Plan Benefits
 

Year Ended December 31, 2003
 
 

Cash
  Credits  

Stock
  Credits  


  Total  
       

Interest income

$    431,331

$             -

$   431,331
       

Dividend income

-

188,933

188,933
       

Unrealized appreciation on Federated Department
       Stores, Inc. common stock


-


9,252,740


9,252,740
       

Participant contributions

2,677,021

769,427

3,446,448
       

      Total additions

3,108,352

10,211,100

13,319,452
       

Distributions

1,701,780

661,668

2,363,448
       

Net additions to assets available for plan benefits

1,406,572

9,549,432

10,956,004
       

Assets available for plan benefits:

      

   Beginning of year

19,018,045

14,713,328

33,731,373

   End of year

$20,424,617

$24,262,760

$44,687,377
       

The accompanying notes are an integral part of these financial statements.

 

EXECUTIVE DEFERRED COMPENSATION PLAN OF

FEDERATED DEPARTMENT STORES, INC.
 

Statement of Changes in Assets Available for Plan Benefits
 

Year Ended December 31, 2002
 
 

Cash
  Credits

Stock
  Credits


  Total  
       

Interest income

$   660,247

$              - 

$    660,247 
       

Unrealized depreciation on Federated Department
      Stores, Inc. common stock


-


(6,068,455)


(6,068,455)
       

Participant contributions

2,525,765

1,238,405 

3,764,170 
       

      Total additions (reductions)

3,186,012

(4,830,050)

(1,644,038)
       

Distributions

805,687

448,133 

1,253,820 
       

Net additions (reductions) to assets
      available for plan benefits


2,380,325


(5,278,183)


(2,897,858)
       

Assets available for plan benefits:

      

   Beginning of year

16,637,720

19,991,511 

36,629,231 

   End of year

$19,018,045

$14,713,328 

$33,731,373 
       

The accompanying notes are an integral part of these financial statements.

 

EXECUTIVE DEFERRED COMPENSATION PLAN OF

FEDERATED DEPARTMENT STORES, INC.
 

Notes to Financial Statements
 

December 31, 2004, 2003 and 2002
 

1.   Description of the Plan
 

The following brief description of the Executive Deferred Compensation Plan of Federated Department Stores, Inc. (the "Plan") is provided for general information purposes only. Participants should refer to the Plan document for more complete information.
 

General
 

The Plan is sponsored by Federated Department Stores, Inc. (the "Company"). The Plan, as amended, enables key employees of the Company to defer cash and certain stock option compensation for personal income tax purposes. The nonqualified Plan was adopted in 1993 and is not subject to the provisions of the Employee Retirement Income Security Act of 1974.
 

Eligibility and Vesting
 

The Plan covers key employees, as designated by the Company and defined in the Plan document. Participation is voluntary and participants can elect to make contributions to the Plan. Participants are 100% vested in the Plan at all times.
 

Participant Accounts
 

An account is maintained for each participant in the Plan, which shows the participant's separate interest in the Cash Credit and Stock Credit portions of the Plan. If a Cash Credit is elected, the participant's account shall be credited, as of the end of each calendar quarter, with the dollar amount of deferred compensation. At the end of each calendar quarter, the Cash Credit account shall be credited with interest at a rate equal to one-quarter of the percent per annum on United States Five-Year Treasury Bills as of the last day of such calendar quarter. If a Stock Credit is elected, the participant's account shall be credited, as of the end of each calendar quarter, with a stock equivalent which shall be the number of full shares of common stock of the Company that is transferred to or purchased by the Grantor Trust (defined later) with the amount of deferred compensation and with the dollar amount of any part of such credit that is not convertible into a full share. At the end of each calendar quarter, the Stock Credit account shall be credited with a dividend equivalent as declared by the Company, if any, upon each share of common stock during such calendar quarter.
 

Participants are eligible for distribution of their benefits upon retirement, death, termination of service, in the event of a designated change of control of the Company and in the event of immediate unexpected financial needs of the participant, as the Plan is not subject to the hardship rules of Section 401 of the Internal Revenue Code. Participants, prior to termination, may request to receive the balance of their cash and stock credit accounts in one to fifteen approximately equal installments. Such requests are subject to committee approval.

 

Effective January 1, 2002, participants have the ability to defer cash compensation on a short-term basis, for a minimum of five years. At the time of such deferral election, participants may request to receive the balance of this short-term deferral account in one to fifteen approximately equal installments. Notwithstanding, participants are eligible for distribution of this short-term account as well as other balances due them under the Plan upon retirement, death, termination of service, in the event of a designated change of control of the Company and in the event of immediate unexpected financial needs of the participant, as the Plan is not subject to the hardship rules of Section 401 of the Internal Revenue Code.
 

Grantor Trust
 

The Company established a Grantor (Rabbi) Trust, a wholly owned subsidiary of the Company, intended to meet the safe harbor provisions of RevProc 92-64, for the benefit of participants' Stock Credits under the Plan. The Trust shall be governed by and subject to the terms of a trust agreement entered into between the Company, as grantor, and the trustee.
 
 

2.   Summary of Significant Accounting Policies
 

a)   Basis of Presentation
 

The accompanying financial statements of the Plan have been prepared on the accrual basis of accounting.
 

b)   Investments
 

The Plan's investments consist of receivables from the Company and common stock of the Company, both of which exceed 5% of assets available for plan benefits. The Company maintains separate book accounts for the benefit of each Plan participant and periodically credits such accounts for deferred compensation, interest and dividend income and distributions. Company shares are allocated to participant accounts based on the share price on the date of purchase. The stock credits had a cost basis of $18,007,974 (516,475 shares) and $17,543,460 (514,805 shares) at December 31, 2004 and December 31, 2003, respectively.
 

c)   Risks and Uncertainties
 

The Plan invests in common stock of the Company. Securities investments, in general, are exposed to various risks, such as interest rates, credit, and overall market volatility risks. Due to the general level of risk associated with securities investments and the additional risks associated with investment in a single security, it is at least reasonably possible that a change in the value of the Company's stock will occur in the near term and that such a change could materially affect the amount reported in the statement of assets available for benefits.
 

d)   Use of Estimates
 

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires the plan administrator to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Such estimates and assumptions are subject to inherent uncertainties, which may result in actual amounts differing from reported amounts.
 

3.   Plan Termination
 

Although the Company has not expressed any intent to terminate the Plan, it may do so at any time. In the event the Plan is terminated, all sums credited to individual accounts would be distributed to participants.
 

4.   Administrative Expenses
 

All administrative costs of the Plan are borne by the Company.

 

5.   Tax Status
 

The Plan is not subject to Federal Income Tax. It is operated as a nonqualified deferred compensation arrangement that effectively defers compensation. The related Grantor (Rabbi) Trust is intended to conform to the safe harbor terms of the model trust as described in Rev. Proc. 92-64.
 
 

Pursuant to the requirements of the Securities and Exchange Act of 1934, the members of the Pension and Profit Sharing Committee (which is the administrative committee for the Executive Deferred Compensation Plan of Federated Department Stores, Inc.) have duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized.
 

Executive Deferred Compensation Plan of

FEDERATED DEPARTMENT STORES, INC.

Dated March 31, 2005

By: /s/ Ronald W. Tysoe                  

Ronald W. Tysoe, Member

Pension and Profit Sharing Committee

Federated Department Stores, Inc.