e11vk
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
ANNUAL REPORT
PURSUANT TO SECTION 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934
(Mark One)
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Annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934 |
For the fiscal year ended December 31, 2005
Or
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Transition report pursuant to Section 15(d) of the Securities Exchange Act of 1934 |
For the transition period from to
Commission File Number: 001-12665
A. Full title of the plan and the address of the plan, if different from that of the issuer
named below:
ACS SAVINGS PLAN
B. Name of issuer of the securities held pursuant to the plan and the address of its principal
executive office:
AFFILIATED COMPUTER SERVICES, INC.
2828 North Haskell Avenue
Dallas, Texas 75204
Notices and communications from the Securities and Exchange Commission relative to this report
should be forwarded to:
William L. Deckelman, Jr., Esq.
Executive Vice President, Secretary And General Counsel
Affiliated Computer Services, Inc.
2828 North Haskell Avenue
Dallas, Texas 75204
(214) 841-6111
REQUIRED INFORMATION
The ACS Savings Plan is subject to the requirements of the Employee Retirement Income Security
Act of 1974 (“ERISA”). Included herein is a copy of the most recent financial statements and
schedules of the ACS Savings Plan prepared in accordance with the financial reporting requirements
of ERISA.
ACS SAVINGS PLAN
FINANCIAL STATEMENTS
AND
REPORT OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTANTS
AS OF DECEMBER 31, 2005 AND 2004, AND
FOR THE YEAR ENDED DECEMBER 31, 2005
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Administrative Committee
ACS Savings Plan
We have audited the accompanying statements of net assets available for benefits of the ACS Savings
Plan (“the Plan”) as of December 31, 2005 and 2004, and the related statement of changes in net
assets available for benefits for the year ended December 31, 2005. 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. The
Plan is not required to have, nor were we engaged to perform, an audit of its internal control over
financial reporting. Our audits included consideration of internal control over financial reporting
as a basis for designing audit procedures that are appropriate in the circumstances, but not for
the purpose of expressing an opinion on the effectiveness of the Plan’s internal control over
financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on
a test basis, evidence supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant estimates made by management, and
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 net assets available for benefits of the Plan at December 31, 2005 and 2004, and the
changes in its net assets available for benefits for the year ended December 31, 2005, in
conformity with accounting principles generally accepted in the United States of America.
Our audits were conducted for the purpose of forming an opinion on the basic financial statements
taken as a whole. The supplemental schedule on page 18, referred to as “supplemental information,”
are presented for the purpose of additional analysis and are not a required part of the basic
financial statements but are supplementary information required by the Department of Labor’s Rules
and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. The supplemental information is the responsibility of the Plan’s management. The
supplemental information has been subjected to auditing procedures applied in the audits of the
basic financial statements and, in our opinion, are fairly stated in all material respects in
relation to the basic financial statements taken as a whole.
/s/ Chapman, Hext & Co., P.C.
Richardson, Texas
May 30, 2006 (except for Note 7 last paragraph and Note 3 last paragraph as
to which the date is
June 20, 2006 and June 26, 2006, respectively)
ACS SAVINGS PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 2005 AND 2004
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2005 |
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2004 |
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ASSETS |
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Total Noninterest-bearing Cash |
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$ |
44,154 |
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$ |
— |
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Participant Directed Investments |
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492,422,998 |
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455,808,218 |
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Contributions Receivable: |
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Employer |
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268,502 |
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340,703 |
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Participants |
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1,630,919 |
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2,030,571 |
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Other |
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— |
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359,246 |
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Total Contributions Receivable |
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1,899,421 |
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2,730,520 |
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Total Assets |
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494,366,573 |
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458,538,738 |
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LIABILITIES |
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Operating Payables |
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500,364 |
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352,929 |
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Net Assets Available for Benefits |
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$ |
493,866,209 |
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$ |
458,185,809 |
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The accompanying notes are an integral part of these financial statements.
2
ACS SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 2005
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ADDITIONS |
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Contributions: |
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Participants |
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$ |
43,740,990 |
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Employer non-cash (ACS Treasury Shares) |
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6,165,896 |
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Participant rollovers |
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8,844,626 |
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Total Contributions |
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58,751,512 |
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Earnings on Investments: |
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Net realized/unrealized appreciation on investments |
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23,531,073 |
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Interest/dividends |
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8,687,558 |
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Total Earnings on Investments |
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32,218,631 |
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Total Additions |
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90,970,143 |
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DEDUCTIONS |
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Benefits paid to participants |
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65,762,094 |
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Plan expenses |
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902,842 |
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Total Deductions |
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66,664,936 |
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Increase in net assets before net transfers to the plan |
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24,305,207 |
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Net transfers to the plan |
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11,375,193 |
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Increase in net assets |
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35,680,400 |
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Net Assets Available for Benefits: |
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Beginning of Period |
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458,185,809 |
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End of Period |
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$ |
493,866,209 |
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The accompanying notes are an integral part of these financial statements.
3
ACS SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2005 AND 2004
NOTE 1. PLAN DESCRIPTION
The following description of the ACS Savings Plan (the “Plan”) provides only general information.
Affiliated Computer Services, Inc. (the “Company”) is the sponsor and administrator of the Plan.
Fidelity Management Trust Company was the Trustee for the period January 1, 2005 through December
1, 2005. Beginning December 1, 2005, Mellon Trust Company became the current Trustee.
Participants should refer to the Plan agreement for a more complete description of the Plan’s
provisions.
General
The Plan as amended and restated was established January 1, 1989, upon conversion of an existing
employee contribution savings plan.
Plan Amendments
Summary of the 2005 plan amendments are as follows.
The Plan was amended effective January 1, 2005 to standardize benefit features provided
under the Plan for employees of all employers enrolled in the Plan. Plan compensation
shall be base pay, overtime and commissions. The matching contribution formula shall be
$0.25 for each $1.00 up to 6%. The vesting schedule applicable to matching contributions
shall be:
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| Years in Vesting Service |
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Vested Interest |
Less than two years |
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0 |
% |
Two to three years |
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50 |
% |
Three or more years |
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100 |
% |
Additionally, the discretionary profit sharing contribution of 4% of compensation
applicable to employees receiving the ACS State and Local Solutions benefit structure was
eliminated.
In February 2005, the Plan assets of TMI 401(k) Plan, Bluestar Solutions Inc. 401(k)
Retirement Plan, and Heritage Information Systems, Inc. 401(k) Plan were merged into the
Plan. The Plan was amended so that all eligible employees would begin participation in the
Plan and receive the ACS corporate benefit structure.
In July 2005, the Plan assets of Visionary Systems, LTD 401(k) Retirement Plan were merged
into the Plan. The Plan was amended so that all eligible employees would begin
participation in the Plan and receive the ACS corporate benefit structure.
4
ACS SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2005 AND 2004
NOTE 1. PLAN DESCRIPTION (CONTINUED)
On December 30, 2005, the ACS Plan was amended to accept the transfer of the assets
attributable to the benefits of HR Solutions employees from the Mellon Human Resources &
Investor Solutions, Inc. 401(k) Savings Plan into the ACS Plan.
On June 26, 2005, the Company entered into an outsourcing arrangement with GlaxoSmithKline,
Inc. Effective December 15, 2005, the Company allowed former employees to participate in
the Plan, and would receive the ACS corporate benefit structure effective on and after the
date eligible to participate in the Plan.
Effective for distributions made on or after March 28, 2005, the Plan was amended to reduce
the vested amount in a participant’s account subject to lump sum distribution without the
participant’s consent from $5,000 to $1,000.
Throughout 2005, the Plan was amended to allow former employees of CareFirst of Maryland,
Inc., United Negro College Fund, Inc., Cendant Operations, Inc., Disney Worldwide Services,
Inc., Valeant Pharmaceuticals International, and Raytheon Training International, GmbH, to
begin participating in the Plan. Employees would receive the ACS corporate benefit
structure effective on and after the date they are eligible to participate in the Plan as
follows:
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| Prior Employer |
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ACS Participation Eligibility Date |
CareFirst of Maryland, Inc.
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April 1, 2005 |
United Negro College Fund, Inc.
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May 1, 2005 |
Cendant Operations
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June 1, 2005 |
Disney Worldwide Services, Inc.
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July 24, 2005 |
Valeant Pharmaceuticals International
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August 18, 2005 |
Raytheon Training International, GmbH
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August 12, 2005 |
The Plan was amended during the year ended December 31, 2004. A summary of the 2004 plan
amendments are as follows.
The Plan assets of Peter Martin Associates, Inc. (PMA), etravelexperts, LLC
(etravelexperts), Patient Accounting Service Center, LLC (PASC), and portions of Lockheed
Martin (LM) and ACS Government Savings Plan were merged into the Plan. All eligible
employees of Lockheed Martin, etravelexperts, LLC and Patient Accounting Service Center,
LLC shall receive the benefit structure applicable to employees of ACS Business Process
Solutions, Inc., and eligible employees of Peter Martin Associates, Inc. shall receive the
benefit structure applicable to employees of ACS State & Local Solutions, Inc.
5
ACS SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2005 AND 2004
NOTE 1. PLAN DESCRIPTION (CONTINUED)
The Company entered into two outsourcing arrangements during the latter part of 2003 and in
each case the Company allowed the outsourced employees to participate in the Plan.
Gateway, Inc. and American International Group, Inc. (AIG) outsourced employees
received the ACS corporate benefit structure effective on and after the date they are
eligible to participate in the Plan.
The Plan was amended to add a one year wait for eligibility to receive discretionary
matching contributions for employees hired, rehired, or transferred to the Company on and
after January 1, 2004 and the one year wait is to be measured by using the elapsed time
method.
Salary Deferral
The Plan is a defined contribution plan wherein participants elect to reduce their compensation and
have such reductions contributed to the Plan on their behalf. Generally, the Plan covers all
eligible employees of the Company who elect to participate except those who are leased or are
nonresident aliens not receiving United States source income. The Plan also allows for rollovers
from other plans.
Employees are eligible to contribute on their date of hire or as soon there after as
administratively feasible. Participating employees are eligible for matching contributions
immediately following completion of a one-year period of service (or the first full pay period for
those receiving the ACS State and Local Solutions, Inc. matching contributions or profit sharing
contribution benefit structure).
Employees can elect to contribute to the Plan for not less than 1% nor more than 18% (1% to 30% for
certain employees formerly employed by Motorola, Inc.) of compensations. The term “compensation”
for calculation of deferral shall be base pay, overtime and commissions. The maximum of
contributions allowed by the Internal Revenue Service was $14,000 for 2005. The Company will match
the deferral contributions of 25% of pre-tax deferral up to 6% of compensation. No after-tax
contributions may be made to the Plan.
Participating employees are eligible to make catch-up contributions under the Plan provided the
participating employees have attained or will attain the age of 50 before the close of the year.
The amount of catch-up contributions allowed by the Internal Revenue Services was $4,000 for 2005.
The catch-up contributions are excluded in calculating the matching compensation.
6
ACS SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2005 AND 2004
NOTE 1. PLAN DESCRIPTION (CONTINUED)
The Company made the following contributions for the associated companies during the year ended
December 31, 2004:
Affiliated Computer Services, Inc./Computer Systems Development, Inc. Plan & Trust/Unclaimed
Property Recovery Reporting, Inc./ACS Business Process Solutions, Inc./ACS Shared Services,
Inc./ACS Education Services, Inc./Outsourced Administrative Systems — 25% of employee
contributions limited to 6% of compensation, determined on a payroll-by-payroll basis.
ACS Enterprise Solutions, Inc. (including The Pace Group, Inc. and Tyler Technologies,
Inc.)/ACS Federal Healthcare, Inc. — 50% of employee contributions limited to 5% of
compensation, determined on a payroll-by-payroll basis.
ACS Government Systems, Inc., formerly SCT Government Systems, Inc. — 50% of employee
contributions limited to 6% of compensation, determined on a payroll-by-payroll basis.
Roadways Division of Affiliated Computer Services, Inc. — 50% of employee contributions limited
to 7% of compensation, determined on a payroll-by-payroll basis.
ACS State & Local Solutions, Inc. — 25% of employee contributions limited to 6% of
compensation, determined on a payroll-by-payroll basis. In addition, employees hired, rehired,
or transferred are not eligible to receive the matching contribution until they have attained
one year of service.
ACS State Healthcare, LLC — 100% of employee contributions for the first 2% of compensation
then 25% of employee contributions for the next 4% of compensation, determined on a
payroll-by-payroll basis.
ACS Health Administration, Inc. — 50% of employee contributions limited to 6% of compensation,
determined on a payroll-by-payroll basis. Employees are not eligible to receive the matching
contribution until they have completed one year of service in which they work at least 1,000
hours.
For both 2005 and 2004, Company matching contributions are made to the ACS employer Stock Fund.
Participants may exchange out of the ACS Stock Fund at any time with no restrictions.
7
ACS SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2005 AND 2004
NOTE 1. PLAN DESCRIPTION (CONTINUED)
Profit Sharing
The discretionary profit sharing contribution of 4% of compensation applicable to employees
receiving the ACS State and Local Solutions benefit structure was eliminated for 2005.
A summary of profit sharing for the year ended December 31, 2004 is as follows.
For the year ended December 31, 2004 the Company made profit sharing contributions on behalf of
employees of ACS State & Local Solutions, Inc. at a rate of 4%. Profit sharing contributions were
discontinued for ACS State and Local Solutions, Inc. beginning January 1, 2005. Prior period
profit sharing contributions were considered fully vested to the extent not vested as of January 1,
2005. Employees of ACS State & Local Solutions, Inc. hired on or after January 1, 2002 were not
eligible to share in the profit sharing contribution until they have attained one year of service.
Allocation
Each participant’s account is credited with the participant’s salary deferral and the Company’s
matching contributions are allocated semimonthly to each participant’s account. Investment income
or loss is allocated daily based on the ratio of each participant’s account balance at the end of
each day.
For the year ended December 31, 2005, there was no allocation for company profit sharing
contributions to each participant’s account because the ACS State and Local Solutions benefit
structure was eliminated for 2005.
For the year ended December 31, 2004, Company profit sharing contributions for ACS State and Local
Solutions were funded on a semimonthly basis. The contributions were allocated among participants
in the same portion that the entitled participant’s compensation for such Plan years bears to the
total compensation of all entitled participants.
Vesting
Effective January 1, 2005, vesting of all employer contributions occurs at the following rates for
employees of all employers enrolled in the Plan. Employee contributions and rollover contributions
are 100% vested. The vesting schedule applicable to matching contributions in 2005 shall be:
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| Years in Vesting Service |
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Vested Interest |
Less than two years |
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0 |
% |
Two to three years |
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50 |
% |
Three or more years |
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100 |
% |
8
ACS SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2005 AND 2004
NOTE 1. PLAN DESCRIPTION (CONTINUED)
Prior to 2005, vesting of employee contributions for employees of certain subsidiaries occurred at
the following rates; ACS Business Process Solutions, Inc.; ACS Shared Services, Inc.; ACS Federal
Healthcare, Inc. (for matching and profit sharing contributions); ACS State & Local Solutions, Inc.
(for matching contributions only); Roadways Division of Affiliated Computer Services, Inc. (after
January 1, 1999); ACS State Healthcare, LLC (for employees hired after September 1, 2002 for
matching contributions only); Unclaimed Property Recovery & Reporting, Inc. (prior service credit
recognized); Computer Systems Development, Inc. Plan & Trust; ACS Government Systems; Outsourced
Administration Systems (effective January 1, 2003 prior service credit recognized); ACS Education
Services, Inc.; and, Concera Corporation (hired, rehired or transferred after December 30, 2002):
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| Years of Vesting Service |
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Vested Interest |
Less than two years |
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0 |
% |
Two to three years |
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50 |
% |
Three or more years |
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100 |
% |
Employees of ACS Business Process Solutions, Inc. and ACS Shared Services, Inc. were 100% vested in
the portion of the matching contributions existing prior to the merger with the ACS Savings Plan
during 2001. Employees of Roadways Division of Affiliated Computer Services, Inc. were 100% vested
in matching contributions made prior to January 1, 1999. Concera Corporation employees were 100%
vested in their matching contributions existing prior to the merger in 2002. Employees of ACS
Health Administration, Inc. were 100% vested in matching and profit sharing contributions.
Vesting of employer matching contributions occurred at the following rates for employees of ACS
Enterprise Solutions, Inc. (including The Pace Group, Inc. and Tyler Technologies, Inc.):
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| Years in Vesting Service |
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Vested Interest |
Less than two years |
|
|
0 |
% |
Two to three years |
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20 |
% |
Three to four years |
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50 |
% |
Four to five years |
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75 |
% |
Five or more years |
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100 |
% |
9
ACS SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2005 AND 2004
NOTE 1. PLAN DESCRIPTION (CONTINUED)
Vesting of employer contributions occurred at the following rates for employees of ACS State and
Local Solutions, Inc. (profit sharing only):
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| Years in Vesting Service |
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Vested Interest |
Less than two years |
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0 |
% |
Two to three years |
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25 |
% |
Three to four years |
|
|
50 |
% |
Four to five years |
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75 |
% |
Five or more years |
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100 |
% |
Vesting of employer matching contributions occurred at the following rates for employees of ACS
Government Systems, Inc., formerly SCT Government Systems, Inc. (prior to January 1, 2001);
Roadways Division of Affiliated Computer Services, Inc. (prior to January 1, 1999); Outsourced
Administrative Systems (prior to January 1, 2003):
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| Years in Vesting Service |
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Vested Interest |
Less than one year |
|
|
0 |
% |
One to two years |
|
|
20 |
% |
Two to three years |
|
|
40 |
% |
Three to four years |
|
|
60 |
% |
Four to five years |
|
|
80 |
% |
Five or more years |
|
|
100 |
% |
Participant Loans
Participants may borrow from their fund accounts, through a loan transaction, a minimum of $1,000
or up to a maximum of $50,000 not to exceed 50% of their account balance.
The balance in the participant’s account is used to secure the loans. These loan transactions are
treated as a transfer between the investment fund and the participant notes fund. The loan terms
range from one to five years or within a reasonable time if the purpose of the loan is to acquire a
primary residence. The interest rate on loan transactions is commensurate with current rates. As
of December 31, 2005 and 2004, interest rates on outstanding loan balances ranged from 3.5% to
11.0% and 4.0% to 11.50%, respectively. Total loans outstanding as of December 31, 2005 and 2004
were $14,209,627 and $13,292,022, respectively.
Principal and interest are paid ratably through payroll deductions. Participant notes receivable
are valued at cost, which approximates fair values. A participant may not have more than two loans
outstanding at the same time.
10
ACS SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2005 AND 2004
NOTE 1. PLAN DESCRIPTION (CONTINUED)
Termination
Although it has not expressed any intent to do so, the Company’s Board of Directors may terminate
the Plan at any time. Upon termination, the Board of Directors may elect to distribute to each
participant, or his or her beneficiary, the proportionate share of the Plan’s assets as determined
by the individual account balances on the date of termination, or continue the existence of the
trust for the purpose of paying benefits as they become due under the terms of the Plan. In
addition, upon termination of the Plan, the participants’ vested interest in employer contributions
shall be 100%.
Upon termination of service, a participant may elect to receive a lump-sum amount equal to the
value of his or her account.
Forfeitures
Forfeitures are used to reduce employer matching or profit sharing contributions or plan
administrative expenses. At December 31, 2005 and 2004, the Plan maintained a balance of $654,160
and $1,185,779, respectively, in forfeited non-vested accounts and utilized $989,058 and $5,454,
respectively, in forfeitures to offset employer contributions and plan expenses.
Plan Administrative Costs
The Plan sponsor absorbs the portion of administrative costs of the Plan not paid by forfeitures.
Funding Policy
It is the policy of the Plan sponsor to remit the employee and employer contribution one week after
the date of payroll.
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
This summary of significant accounting policies of the Plan is presented to assist in understanding
the financial statements. The financial statements and notes are representations of the Plan’s
administrator, who is responsible for their integrity and objectivity. The accounting policies
conform to accounting principles generally accepted in the United States of America and have been
consistently applied in the preparation of the financial statements.
11
ACS SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2005 AND 2004
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
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 certain reported amounts and disclosures, such as fair value. Accordingly, actual
results may differ from those estimates.
Investment Valuation and Income Recognition
As of December 31, 2005, Mellon Trust Company holds the Plan investments, of which were transferred
from Fidelity Management Trust Company on December 1, 2005. From January 1, 2005 to November 30,
2005, and for 2004, Fidelity Management Trust Company held the Plan’s investments. The fair value
per unit/share is stated at quoted market prices as determined by Mellon Trust Company from
December 1, 2005 to December 31, 2005 and Fidelity Management Trust Company from January 1, 2005 to
November 30, 2005 and for 2004. Purchases and sales of securities are recorded on a trade-date
basis. Dividends are recorded on the ex-dividend date. Interest income is recorded on the accrual
basis.
The Plan presents, in the Statement of Changes in Net Assets Available for Benefits, the net
appreciation (depreciation) in the fair value of its investments, which consists of the realized
gains (losses) and the unrealized appreciation (depreciation) on those investments.
Payment of Benefits
Benefit payments are recorded when paid.
NOTE 3. INCOME TAX STATUS
The Plan obtained its determination letter on May 7, 2003, in which the Internal Revenue
Service stated that the Plan, as then designed, was in compliance with the applicable requirements
of the Internal Revenue Code (IRC).
On June 13, 2006, the Plan received another determination letter from the Internal Revenue Service
on Plan amendments executed in 2003 to 2005.
12
ACS SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2005 AND 2004
NOTE 4. INVESTMENTS
The Plan maintains the following investments representing 5% or more of net assets available for
benefits at December 31, 2005 and 2004:
| |
|
|
|
|
|
|
|
|
| |
|
2005 |
|
2004 |
Fidelity Growth Company Fund |
|
$ |
63,151,662 |
|
|
$ |
58,469,211 |
|
Fidelity Low-Priced Stock Fund |
|
|
47,096,463 |
|
|
|
46,867,705 |
|
Fidelity Money Market Trust Retirement |
|
|
87,319,058 |
|
|
|
88,254,225 |
|
Fidelity Spartan US Equity Index Fund |
|
|
34,491,508 |
|
|
|
36,609,675 |
|
Fidelity Diversified Int’l Fund |
|
|
28,029,426 |
|
|
|
— |
|
ACS Stock Fund |
|
|
48,580,773 |
|
|
|
49,631,131 |
|
The Plan invests in various investment securities which, in general, are exposed to various
risks, such as interest rate, credit and overall market volatility risks. Further, due to the
level of risk associated with certain investment securities it is at least reasonably possible that
changes in values of investment securities will occur in the near term and that such changes could
materially affect participants’ account balances and the amounts reported in the Statements of Net
Assets Available for Benefits.
The Plan invests in Master Trust arrangement consisting of common stock. Investment information
related to the Master Trust arrangement is as follows:
| |
|
|
|
|
|
|
|
|
| |
|
2005 |
|
2004 |
Net Assets |
|
|
|
|
|
|
|
|
Common Stock |
|
$ |
53,134,048 |
|
|
$ |
54,727,199 |
|
13
ACS SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2005 AND 2004
NOTE 4. INVESTMENTS (CONTINUED)
| |
|
|
|
|
| |
|
Year Ended |
|
| |
|
December 31, 2005 |
|
Change in Net Assets: |
|
|
|
|
Contributions |
|
$ |
10,336,045 |
|
Interest/Dividends |
|
|
105,569 |
|
Net Appreciation of Investments |
|
|
180,059 |
|
Benefits Paid to Participants |
|
|
(6,511,275 |
) |
Administrative Fees |
|
|
(13,930 |
) |
Net Transfer to/from the Fund |
|
|
(5,689,619 |
) |
|
|
|
|
|
|
|
|
|
Net Change |
|
$ |
(1,593,151 |
) |
|
|
|
|
The Net Assets of the Master Trust Investment at year end shall equal the aggregate value of
the assets of the Master Trust Investment less the value of the accrued liabilities of the Master
Trust Investment. The assets of the Master Trust Investment shall be determined in accordance with
generally recognized valuation procedures based upon prices and quotes from independent pricing
services.
During the year ended December 31, 2005, the Plan’s investments (including gains and losses on
investments bought and sold, as well as held during the year) appreciated in value by $23,531,073
as follows:
| |
|
|
|
|
| |
|
2005 |
|
Mutual Funds |
|
$ |
23,279,500 |
|
Nonemployee corporate stock |
|
|
494,729 |
|
ACS Stock Fund |
|
|
(243,156 |
) |
|
|
|
|
|
|
|
|
|
|
|
$ |
23,531,073 |
|
|
|
|
|
NOTE 5. RELATED PARTY TRANSACTIONS
The Plan invested in investments managed by a subsidiary of Fidelity Management Trust Company for
the period ended December 1, 2005 and Mellon Trust Company from December 1, 2005 to December 31,
2005, who acted as custodian of the Plan’s assets, as defined by the Plan. These transactions
qualify as party-in-interest transactions. However, these transactions are exempt from the
prohibited transaction rules.
14
ACS SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2005 AND 2004
NOTE 5. RELATED PARTY TRANSACTIONS (CONTINUED)
The Plan allows for participant loans. These loans qualify as party-in-interest transactions.
However, these transactions are exempt from the prohibited transaction rules.
NOTE 6. PLAN MERGERS
A summary of Plan mergers for 2005 are as follows.
Assets of TMI 401(k) Plan were transferred into the ACS Savings Plan and the TMI 401(k) Plan, as it
previously existed, was merged in February 2005. The funds transferred totaled approximately
$1,944,853 and were reinvested with Fidelity in similar investments.
Assets of Visionary Systems, Ltd. 401(k) Retirement Plan were transferred into the ACS Savings Plan
and the Visionary Plan, as it previously existed, was merged in July 2005. The funds transferred
totaled approximately $872,300 and were reinvested with Fidelity in similar investments.
Assets of Bluestar Solutions Inc. 401(k) Retirement Plan were transferred into the ACS Savings Plan
and the Bluestar Solutions Inc. 401(k) Retirement Plan, as it previously existed, was merged in
March 2005. The funds transferred totaled approximately $5,842,389 and were reinvested with
Fidelity in similar investments.
Assets of Heritage Information Systems, Inc. 401(k) Plan were transferred into the ACS Savings Plan
and the Heritage Information Systems, Inc. 401(k) Plan, as it previously existed, was merged in
March 2005. The funds transferred totaled approximately $1,962,335 and were reinvested with
Fidelity in similar investments.
Participant loans of $753,316 were also transferred into the Plan through the various mergers.
The Statement of Changes in Net Assets Available for Benefits includes the activity from the
employees of these companies from the date the assets were merged into the ACS Savings Plan to the
year ended December 31, 2005.
15
ACS SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2005 AND 2004
NOTE 7. SUBSEQUENT EVENTS
In the normal course of business, the Company may consolidate additional plans or eliminate current
subsidiaries into or out of the ACS Savings Plan.
On January 1, 2006, the ACS Plan was amended to merge the Superior Consultant Holdings Corp. 401(k)
Profit Sharing Plan and all of its assets and liabilities into the ACS Plan. Superior Consultant
Holdings Corp. participants are immediately eligible to participate in the Plan, and receive the
ACS corporate benefit structure.
On April 1, 2006, the ACS Plan was amended to merge the ASCOM Transport Systems, Inc. 401(k)
Retirement Plan and all of its assets and liabilities into the ACS Plan. ASCOM Plan participants
are immediately eligible to participate in the Plan, receive Company matching contributions and the
ACS corporate benefit structure.
On April 1, 2006, the ACS Plan was amended to merge the LiveBridge, Inc. 401(k) Profit Sharing Plan
and all of its assets and liabilities into the ACS Plan. LiveBridge Plan participants are
immediately eligible to participate in the Plan, and receive the ACS corporate benefit structure.
In May 2006, the Plan sponsor received notice from the U.S. Department of Labor of a review of the
Plan under Section 504 of the Employee Retirement Income Security Act of 1974.
NOTE 8. SEPARATED PARTICIPANTS WITH VESTED BENEFITS
There were 7,441 and 5,060 terminated participants with vested benefits of $151,039,303 and
$126,870,643 as of December 31, 2005 and 2004, respectively.
NOTE 9. FORM 5500
The Form 5500 was not available for review at the time of filing the audited financial statements
on Form 11-K with the Securities and Exchange Commission. However, in order to comply with ERISA,
a comparison and reconciliation of the audited financial statements with the Form 5500 will occur
before the Form 5500 is finalized and filed (with the accompanying audited financial statements).
The plan administrator does not anticipate any changes to these financial statements as a result of
this reconciliation.
16
ACS
SAVINGS PLAN
SCHEDULE H,
LINE 4i SCHEDULE OF ASSETS (HELD AT END OF YEAR)
FOR
THE YEAR ENDED DECEMBER 31, 2005
EIN #51-0310342
PLAN NUMBER 333
| |
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
(b) Identity of |
|
|
|
|
|
|
|
|
| |
|
Issue, Borrower, |
|
(c) Description of Investment, including |
|
|
|
|
|
|
| |
|
Lessor or Similar |
|
maturity date, rate of interest, collateral, |
|
|
|
|
|
|
| (a) |
|
Party |
|
par, or maturity value |
|
(d) Cost |
|
|
(e) Current Value |
|
* |
|
Mellon |
|
Fidelity Money Market Trust Retirement |
|
|
|
|
|
$ |
87,319,058 |
|
* |
|
Mellon |
|
BrokerageLink |
|
|
|
|
|
|
652,554 |
|
* |
|
Mellon |
|
PIMCO Total Return Fund-Admin Class |
|
|
|
|
|
|
20,478,633 |
|
* |
|
Mellon |
|
Franklin Small Cap Growth Fund I-Class A |
|
|
|
|
|
|
14,410,802 |
|
* |
|
Mellon |
|
AIM Dynamics Inv |
|
|
|
|
|
|
5,478,562 |
|
* |
|
Mellon |
|
American Beacon Small Cap Fund |
|
|
|
|
|
|
3,609,330 |
|
* |
|
Mellon |
|
Managers Special Equity Fund |
|
|
|
|
|
|
695,755 |
|
* |
|
Mellon |
|
Phoenix Multi-Portfolio Fund |
|
|
|
|
|
|
11,919,926 |
|
* |
|
Mellon |
|
PIMCO High Yield Fund-Admin Class |
|
|
|
|
|
|
6,132,517 |
|
* |
|
Mellon |
|
Davis NY Venture Fund |
|
|
|
|
|
|
17,966,028 |
|
* |
|
Mellon |
|
Vanguard Global Equity Fund |
|
|
|
|
|
|
15,061,339 |
|
* |
|
Mellon |
|
Vanguard Balanced Fund |
|
|
|
|
|
|
13,585,676 |
|
* |
|
Mellon |
|
Fidelity Equity-Income Fund |
|
|
|
|
|
|
17,905,646 |
|
* |
|
Mellon |
|
Fidelity Growth Company Fund |
|
|
|
|
|
|
63,151,662 |
|
* |
|
Mellon |
|
Fidelity Low-Priced Stock Fund |
|
|
|
|
|
|
47,096,463 |
|
* |
|
Mellon |
|
Fidelity Diversified Int'l Fund |
|
|
|
|
|
|
28,029,426 |
|
* |
|
Mellon |
|
Fidelity Freedom Income Fund |
|
|
|
|
|
|
1,769,846 |
|
* |
|
Mellon |
|
Fidelity Freedom 2000 Fund |
|
|
|
|
|
|
2,887,363 |
|
* |
|
Mellon |
|
Fidelity Freedom 2010 Fund |
|
|
|
|
|
|
8,691,063 |
|
* |
|
Mellon |
|
Fidelity Freedom 2020 Fund |
|
|
|
|
|
|
12,868,939 |
|
* |
|
Mellon |
|
Fidelity Freedom 2030 Fund |
|
|
|
|
|
|
6,997,593 |
|
* |
|
Mellon |
|
Fidelity Spartan US Equity Index Fund |
|
|
|
|
|
|
34,491,508 |
|
* |
|
Mellon |
|
Fidelity Freedom 2040 Fund |
|
|
|
|
|
|
3,879,634 |
|
* |
|
Mellon |
|
ACS Stock Fund |
|
|
|
|
|
|
48,580,773 |
|
* |
|
Mellon |
|
Lockheed Martin Stock Fund |
|
|
|
|
|
|
4,553,275 |
|
* |
|
Participant Loans |
|
At 3.5% to 11.0% |
|
|
-0- |
|
|
|
14,209,627 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
492,422,998 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| * Denotes a party-in-interest |
18
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the trustees (or other
persons who administer the employee benefit plan) have duly caused this annual report to be signed
on its behalf by the undersigned hereunto duly authorized.
| |
|
|
|
|
|
|
| |
|
ACS SAVINGS PLAN |
|
|
|
|
|
|
|
|
|
|
|
By:
|
|
Affiliated Computer Services, Inc.
Plan Administrator |
|
|
|
|
|
|
|
|
|
|
|
By:
Name:
|
|
/s/ Lora Villarreal
Lora Villarreal
|
|
|
|
|
Title:
|
|
Senior Vice President and Chief People
Officer |
|
|
Date: June 26, 2006
19
INDEX TO EXHIBITS
| |
|
|
| Exhibit |
|
|
| Number |
|
Exhibit Name |
23*
|
|
Consent of Chapman, Hext & Co., P.C. |
20