FORM 11-K
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
ANNUAL REPORT
PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR FISCAL YEAR ENDED DECEMBER 31, 2001
COMMISSION FILE NUMBER ____________
AFFILIATED COMPUTER SERVICES, INC. SAVINGS PLAN
(FULL TITLE OF THE PLAN)
----------
AFFILIATED COMPUTER SERVICES, INC.
(NAME OF ISSUER)
2828 NORTH HASKELL AVENUE
DALLAS, TEXAS 75201
(PRINCIPAL EXECUTIVE OFFICE)
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 75201
(214) 841-6144
REQUIRED INFORMATION
The Affiliated Computer Services, Inc. Savings Plan is subject to the
requirements of the Employee Retirement Income Security Act of 1974. Attached
hereto is a copy of the most recent financial statements and schedules of the
Plan prepared in accordance with the financial reporting requirements of ERISA.
INDEX TO EXHIBITS
Exhibit No. Description
23 Consent of Salmon, Beach & Company, P.C.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Administrative Committee (or other persons who administer the employee
benefit plan) has duly caused this annual report to be signed on its behalf by
the undersigned hereunto duly authorized.
AFFILIATED COMPUTER SERVICES, INC. SAVINGS PLAN
By: Lora Villarreal
-------------------------------
Name: Lora Villarreal
Title: Administrative Committee Member
Date: June 28, 2002
ACS SAVINGS PLAN
FINANCIAL STATEMENTS
AND
INDEPENDENT AUDITORS' REPORT
FOR THE YEAR ENDED DECEMBER 31, 2001
ACS SAVINGS PLAN
TABLE OF CONTENTS
DECEMBER 31, 2001
Independent Auditors' Report .................................................................................... 1
Statements of Net Assets Available for Benefits
December 31, 2001 and 2000.................................................................................... 3
Statement of Changes in Net Assets Available for
Benefits-Year Ended December 31, 2001......................................................................... 4
Notes to Financial Statements ................................................................................... 5
Supplemental Schedule............................................................................................ 15
INDEPENDENT AUDITORS' REPORT
To the Participants and Plan Committee of
ACS Savings Plan
We have audited the accompanying statements of net assets available for plan
benefits of ACS Savings Plan (Plan) as of December 31, 2001 and 2000, and the
related statement of changes in net assets available for plan benefits for the
year ended December 31, 2001. 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 audit.
We conducted our audit in accordance with auditing standards generally accepted
in the United States of America. 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 audit provides 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 plan benefits of the Plan as
of December 31, 2001 and 2000, and the changes in net assets available for plan
benefits for the period ended December 31, 2001 in conformity with accounting
principles generally accepted in the United States of America.
Our audit of the Plan's financial statements was conducted for the purpose of
forming an opinion on the basic financial statements taken as a whole. The
supplemental schedule on page 15 is presented for the purpose of additional
analysis and is not a required part of the basic financial statements but is
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.
ACS Savings Plan
Page two
The supplemental schedule is the responsibility of the Plan's management. The
supplemental schedule has been subjected to the 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.
Salmon, Beach & Company
a Professional Corporation
Certified Public Accountants & Consultants
Dallas, Texas
June 24, 2002
ACS SAVINGS PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 2001 AND 2000
2001 2000
------------ ------------
ASSETS
Cash in Fidelity Interest Bearing Accounts $ 31,302,915 $ --
Funds held in Connecticut General Life Insurance
Guaranteed Income Fund 678 11,624,613
Participant Directed Investments:
Pooled separate accounts held by Connecticut
General Life Insurance
At fair value 3,452 40,273,645
Pooled separate accounts held by Fidelity
At fair value 84,058,206 --
Employer related stock 18,111,973 8,403,265
Non-employee corporate stock 2,490,635 --
Participant loans 3,881,410 2,141,445
------------ ------------
139,849,269 62,442,968
------------ ------------
Accounts Receivable
Employer 279,304 43,757
Participants 631,589 203,294
Other 7,492 --
------------ ------------
Total Other Accounts Receivable 918,385 247,051
------------ ------------
TOTAL ASSETS 140,767,654 62,690,019
------------ ------------
LIABILITIES
Benefit claims payable 58,051 --
Operating payables 81,407 --
------------ ------------
139,458 --
------------ ------------
NET ASSETS AVAILABLE FOR BENEFITS $140,628,196 $ 62,690,019
============ ============
The accompanying notes are an integral part of this financial statement.
3
ACS SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 2001
PARTICIPANT NON-PARTICIPANT
DIRECTED DIRECTED TOTAL
------------- --------------- -------------
ADDITIONS:
Contributions:
Participants $ 10,750,554 $ 711,329 $ 11,461,883
Employer 3,041,511 2,578,187 5,619,698
Rollover from other plans 2,116,734 415,801 2,532,535
------------- ------------- -------------
Total contributions 15,908,799 3,705,317 19,614,116
------------- ------------- -------------
Earnings on investments:
Net realized/unrealized depreciation on investments (4,939,399) 17,366,027 12,426,628
Interest/dividends 796,205 (46,279) 749,926
------------- ------------- -------------
Total earnings on investments (4,143,194) 17,319,748 13,176,554
------------- ------------- -------------
Total Additions 11,765,605 21,025,065 32,790,670
------------- ------------- -------------
DEDUCTIONS:
Benefits paid to participants 5,469,700 763,788 6,233,488
Plan expenses 30,603 4,346 34,949
------------- ------------- -------------
Total Deductions 5,500,303 768,134 6,268,437
------------- ------------- -------------
INCREASE IN NET ASSETS 6,265,302 20,256,931 26,522,233
Net transfers to (from) this plan 61,478,140 (10,062,196) 51,415,944
NET ASSETS AVAILABLE FOR BENEFITS:
BEGINNING OF PERIOD 54,286,754 8,403,265 62,690,019
------------- ------------- -------------
END OF PERIOD $ 122,030,196 $ 18,598,000 $ 140,628,196
============= ============= =============
The accompanying notes are an integral part of this financial statement.
4
ACS SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2001
NOTE 1. PLAN DESCRIPTION
The following description of the ACS Savings Plan (Plan) provides only general
information. Affiliated Computer Services, Inc. (Company) is the sponsor and
administrator of the Plan. Fidelity Management Trust Company is the Trustee.
Participants should refer to the Plan agreement for a more complete description
of the Plan's provisions.
GENERAL
The Plan was established January 1, 1989, upon conversion of an existing
employee contribution savings plan. The Plan was amended and restated as of
January 1, 1999 to merge the assets of the Affiliated Computer Services, Inc.
Savings Plan with the Roadway Savings Plan and the Micah Plan. Roadway and Micah
are separate divisions owned by the Company. The Plan was renamed ACS Savings
Plan, amended and restated as of July 1, 2001 to merge the assets of ACS
Business Process Solutions Savings Plan, ACS Enterprise Solutions, Inc. (which
includes employees of The Pace Group, Inc. 401(k) Profit Sharing Plan and Tyler
Technologies, Inc. 401(k) Profit Sharing Plan), ACS Government Systems Plan for
former SCT Employees, ACS Shared Services Plan, Birch & Davis Associates, Inc.
Money Purchase Pension Plan, and Birch & Davis Associates, Inc. 401(k) Plan.
These plans were merged at various times during the year. The Plan is subject to
the provisions of the Employee Retirement Income Security Act of 1974 (ERISA)
and Section 401(a) of the Internal Revenue Code of 1986.
The Plan changed administrators in June 2001 from CIGNA to Fidelity Investments.
Participants in the Plan had the option of investing their contributions to the
Plan in the following funds held at CIGNA during the year ended December 31,
2001:
GENERAL ACCOUNT
CIGNA Charter Guaranteed Income Fund is a fixed income fund that invests
in a diversified portfolio of high quality, fixed-income instruments
(primarily intermediate-term bonds and commercial mortgages) within
Connecticut General Life Insurance Company's General Account. The
principal and interest earnings are guaranteed by CIGNA.
SEPARATE ACCOUNTS
CIGNA Charter Corporate Bond Fund primarily invests in investment-grade,
publicly traded U.S. dollar-denominated corporate bonds.
CIGNA Lifetime Funds are comprised of five distinct funds offering a
range of risk/return characteristics for 20, 30, 40, 50 and 60 year olds.
These funds include different bond/stock mixes that are appropriate for
individuals at different stages of their lives.
CIGNA Stock Market Index Account invests primarily in Standard and Poor's
500 index companies.
Fidelity Advisor Growth Opportunities Fund invests in common stocks and
securities which are convertible to the common stock of companies
believed to have long-term growth potential.
5
ACS SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 2001
NOTE 1. PLAN DESCRIPTION (CONTINUED)
SEPARATE ACCOUNTS (CONTINUED)
Fidelity Advisor Equity Growth Account invests primarily in common and
preferred stock and securities convertible into common stock.
American Century - Twentieth Century Ultra Account invests in equity
securities of large and medium-sized companies that offer the potential
for better-than-average prospects for capital appreciation.
Large Company Stock - Growth Fund, managed by Putnam, invests primarily
in the equity securities selected from 600 to 1,000 companies that have
market capitalization of at least $2 billion, a minimum of 10% earnings
per share growth on a five-year basis and evidence of ample liquidity.
Small Company Stock - Value I Fund (Berger Associates, Inc.) invests
primarily in common stocks of small companies.
Small Company Stock - Growth Fund, managed by Fiduciary Trust Company
International, invests primarily in the common and preferred stocks of
U.S. companies with market capitalization between $30 million and $3
billion with a focus on growing companies involved in new product
development and technological breakthroughs.
Janus Worldwide Account invests primarily in common stocks of foreign and
domestic companies to provide long-term growth of capital and
preservation of capital.
Affiliated Computer Services (ACS) stock is an investment in the
Company's stock.
Fidelity Puritan Fund invests approximately 60% of its assets in stocks
and other equity securities and the remainder in bonds and other debt
securities that may include a lower quality debt. At least 25% of the
total assets are invested in fixed income senior securities.
Participants in the Plan had the option of investing their contributions to the
Plan in the following funds held at Fidelity during the year ended December 31,
2001:
SEPARATE ACCOUNTS
Fidelity BrokerageLink seeks to provide a broad range of investment
products allowing the participant to manage their retirement savings more
actively. The participant can invest in most listed stocks, options,
corporate bonds, zero-coupon bonds, U.S. Treasury securities, mortgage
securities and U.S. government agency bonds, certificates of deposit,
unit investment trusts, foreign securities, and other securities.
Fidelity Diversified International Fund is a growth mutual fund that
seeks to increase the value of investments over the long term through
capital growth by investing at least 65% of total assets in foreign
securities.
6
ACS SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 2001
NOTE 1. PLAN DESCRIPTION (CONTINUED)
SEPARATE ACCOUNTS (CONTINUED)
Fidelity Equity-Income Fund is a growth and income mutual fund which
seeks to provide a reasonable income by attempting to provide a yield
that exceeds the composite yield of the Standard & Poor's 500 Index. At
least 65% of total assets are invested in income-producing equity
securities, mostly large-cap "value" stocks.
Fidelity Freedom Income Funds (General, 2000, 2010, 2020, 2030 and 2040)
offer a blend of stocks, bonds, and short-term investments within a
single fund. The general fund seeks high current income and capital
appreciation while the target retirement dates seek to provide high total
returns.
Fidelity Growth Company Fund is a growth mutual fund that seeks to
provide capital appreciation by investing primarily in common stocks with
above-average growth potential.
Fidelity Low-Priced Stock Fund is a growth mutual fund that seeks to
provide capital appreciation by normally investing at least 65% of total
assets in low-priced common stocks of small and medium-sized companies.
Fidelity Retirement Money Market Portfolio is a money market mutual fund
that seeks to provide a high level of current income that is consistent
with the preservation of capital and liquidity. It invests in U.S.
dollar-denominated money market securities and repurchase agreements for
those securities, and may enter into reverse repurchase agreements.
Fidelity Spartan U.S. Equity Index Fund is a growth and income mutual
fund seeking to provide investment results that correspond to the total
return performance of common stocks publicly traded in the United States
by investing at least 80% of assets in common stocks included in the S&P
500.
ACS Stock Fund is a fund that seeks to increase the value of investments
over the long term by investing in the common stock of the employer by
pooling employee's money to buy shares of stock in the employer or its
affiliates. Ownership is measured in units of the fund instead of shares
of stock.
Brazos Real Estate Securities Fund is a growth and income mutual fund
that seeks to provide exposure to the real estate market, with the
flexibility and control offered by a portfolio of real estate securities.
The fund's assets are invested primarily in stocks of companies in the
real estate industry, including real estate investment trusts.
Davis New York Venture Fund, Inc. - Class A is a value mutual fund which
seeks to increase the value of investments over the long term through
capital growth by investing primarily in stocks of large U.S. companies
with market capitalizations of at least $5 billion, with prospects for
long-term sustainable growth.
7
ACS SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 2001
NOTE 1. PLAN DESCRIPTION (CONTINUED)
SEPARATE ACCOUNTS (CONTINUED)
Franklin Small-Mid Cap Growth Fund I - Class A is a growth mutual fund
seeking to increase the value of investment over the long term through
capital growth by normally investing at least 80% of its assets in the
equity securities of U.S. small-capitalization companies and U.S.
mid-capitalization companies.
INVESCO Dynamics Fund is a growth mutual fund that seeks to increase
investment over the long term through capital growth by investing
primarily in domestic common stocks of companies traded on both the U.S.
securities exchanges and the over-the-counter market.
PIMCO High Yield Fund - Administrative Class Shares is an income mutual
fund which seeks to provide a combination of high current income and
capital growth by investing primarily in U.S. dollar-denominated bonds of
domestic and foreign issuers rated below investment grade, but at least a
B rating.
PIMCO Total Return Fund - Administrative Class Shares is an income mutual
fund that seeks to provide a high total return that exceeds general bond
market indices by investing in all types of bonds, including U.S.
government, corporate, mortgage, and foreign.
Vanguard Balanced Index Fund seeks to provide investment results that
match the combined performance of the Wilshire 5000 Index and Lehman
Brothers Aggregate Bond Index. The fund invests 60% of its assets in
equity securities and 40% in debt securities.
Vanguard Global Equity Fund is a growth stock mutual fund that seeks to
provide the potential for long-term growth of capital by investing in
U.S. and foreign stocks that offer attractive prospects for total return.
Lockheed Martin Stock Fund is a unitized single security fund established
to facilitate the rollover of employee accounts acquired with the
acquisition of IMS (a subsidiary of ACS). This fund is closed to any new
investment and once an employee sells all or a portion of their holdings
they cannot reinvest in this fund.
SCT Stock Fund is a unitized single security fund established to
facilitate the rollover of employee accounts acquired with the
acquisition of SCT (a subsidiary of ACS). This fund is closed to any new
investment and once an employee sells all or a portion of their holdings
they cannot reinvest in this fund.
8
ACS SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 2001
NOTE 1. PLAN DESCRIPTION (CONTINUED)
FUNDING
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. The Plan covers all eligible employees of the Company who elect to
participate except those who are covered by a collective bargaining agreement,
leased or nonresident aliens not receiving United States source income.
Participating employees may contribute up to the lesser of 15% (18% effective
September 1, 2001) of covered compensation through payroll deductions or the
maximum amount permitted under applicable Internal Revenue Service provisions.
The Company may make a discretionary matching contribution each pay period to
the plan based on a percentage of the participant's compensation and company
profitability as decided by the Company's Board of Directors.
The Company made the following contributions for the associated companies during
the year ended December 31, 2001:
Affiliated Computer Services, Inc. - 25% of employee contributions
limited to 6% of compensation, determined on a payroll-by-payroll basis.
ACS Business Process Solutions, Inc. and ACS Shared Services, Inc. - 75%
of employee contributions limited to 4% of compensation, determined on a
payroll-by-payroll basis.
ACS Enterprise Solutions, Inc. (including The Pace Group, Inc. and Tyler
Technologies, Inc.) - 50% of employee contributions limited to 5% of
compensation, determined on a payroll-by-payroll basis.
ACS Federal Healthcare, Inc. - 50% of employee contributions limited to
5% of compensation, determined on a monthly 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.
Micah Technologies Services, Inc. - 25% 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. - 50% of employee contributions limited
to 8% of compensation, determined on a payroll-by-payroll basis.
Company matches are made in Affiliated Computer Services, Inc. stock. Effective
July 1, 2001, participants may exchange out of the ACS Stock Fund at any time
with no restrictions.
9
ACS SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 2001
NOTE 1. PLAN DESCRIPTION (CONTINUED)
FUNDING (CONTINUED)
The Company may make a profit sharing contribution to employees of Affiliated
Computer Services, Inc.; ACS Enterprise Solutions, Inc. (including The Pace
Group, Inc. and Tyler Technologies, Inc.); ACS Federal Healthcare, Inc.; ACS
Government Systems, Inc., formerly SCT Government Systems, Inc.; Micah
Technologies Services, Inc.; Roadways Division of Affiliated Computer Services,
Inc.; and ACS State & Local Solutions, Inc.
Employees generally must complete 1,000 hours of service during the plan year
and be employed on the last day of the plan year. For the year ended December
31, 2001 the Company made the following profit sharing contributions to
employees of:
Roadways 3%
SLS (excluding Orange County, California) 5%
SLS (Orange County, California) 3%
ALLOCATION
Each participant's account is credited with the participant's and the Company's
matching contributions and 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.
Company profit sharing contributions are allocated on a semimonthly basis among
participants in the same proportion that the entitled participant's compensation
for such Plan year bears to the total compensation of all entitled participants.
VESTING
Employee contributions are 100% vested. An employee is credited with a year of
service for each fiscal year in which the employee completes at least 1,000
hours of service.
Vesting of employer contributions occurs at the following rates for employees of
Affiliated Computer Services, Inc., ACS Business Process Solutions, Inc., ACS
Shared Services, Inc., ACS Federal Healthcare, Inc., Micah Technologies
Services, Inc., ACS State & Local Solutions, Inc., and Roadways Division of
Affiliated Computer Services, Inc. (after January 1, 1999):
Years of Vesting Service Vested Interest
------------------------ ---------------
Less than two years 0%
Two to three years 50%
Three or more years 100%
Employees of ACS Business Process Solutions, Inc. and ACS Shared Services, Inc.
are 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. are 100% vested in matching contributions
made prior to January 1, 1999.
10
ACS SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 2001
NOTE 1. PLAN DESCRIPTION (CONTINUED)
VESTING (CONTINUED)
Vesting of employer contributions occurs at the following rates for employees of
ACS Enterprise Solutions, Inc. (including The Pace Group, Inc. and Tyler
Technologies, Inc.):
Years of Vesting Service Vested Interest
------------------------ ---------------
Less than two years 0%
Two to three years 20%
Three to four years 50%
Four to five years 75%
Five or more years 100%
Vesting of employer contributions occurs at the following rates for employees of
ACS Government Systems, Inc., formerly SCT Government Systems, Inc., and for
employees of Roadways Division of Affiliated Computer Services, Inc. (prior to
January 1, 1999):
Years of Vesting Service 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 NOTES RECEIVABLE
Participants may borrow from their fund accounts a minimum of $1,000 or up to a
maximum equal to the lesser of $50,000 or 50% of their account balance. A
participant may not have more than two loans outstanding at the same time. Loan
transactions are treated as a transfer to (from) the investment fund and from
(to) the Participant Notes fund. Loan terms range from 1-5 years or within a
reasonable time if the purpose of the loan is to acquire a primary residence.
The balance in the participant's account secures the loans. The interest rate is
a reasonable rate commensurate with current rates. Interest rates range from 6%
to 13.5%. Principal and interest are paid ratably through payroll deductions.
Participant notes receivable are valued at cost, which approximates fair values.
11
ACS SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 2001
NOTE 1. PLAN DESCRIPTION (CONTINUED)
TERMINATION
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 either a
lump-sum amount equal to the value of his or her account, or one of various
installment payments available under the Plan.
FORFEITURES
Forfeitures are used reduce the plan administrative expenses. At December 31,
2001, the Plan maintained a balance of $362,916 in forfeited non-vested accounts
and utilized $49,202 in forfeitures to offset employer contributions.
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.
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
Fidelity Management Trust Company (Fidelity) holds the Plan's investments. The
fair value per unit/share is stated at quoted market prices. Purchases and sales
of securities are recorded on a trade-date basis. 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 consist of the realized gains (losses) and the unrealized
appreciation (depreciation) on those investments.
PAYMENT OF BENEFITS
Benefit payments are recorded when paid.
12
ACS SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 2001
NOTE 3. INCOME TAX STATUS
The Internal Revenue Service has determined by letter dated March 11, 1994, that
the Plan, as then designed, was in compliance with the applicable sections of
the Internal Revenue Code (IRC). The Plan has since been amended and restated
and a request for a new determination was filed on February 28, 2002. The Plan
administrator and the Plan's tax counsel believe that the Plan is designed and
is currently being operated in compliance with the applicable requirements of
the IRC. Therefore, no provision for income taxes has been included in the
Plan's financial statements.
NOTE 4. TERMINATED EMPLOYEE INFORMATION
The Plan holds funds for 2,795 terminated employees with account balances
totaling $31,967,999 at December 31, 2001.
NOTE 5. INVESTMENTS
The Plan maintains the following investments representing 5% or more of net
assets available for benefits at December 31, 2001:
Fidelity Growth Company Fund 29,559,067
Fidelity Low-Priced Stock Fund 9,278,160
Fidelity Money Mkt Trust 30,794,206
Fidelity Spartan US Equity Index Fund 10,948,706
NOTE 6. RELATED PARTY TRANSACTIONS
The Plan invested in units of pooled separate accounts managed by a subsidiary
of CIGNA and Fidelity, who acted as custodians 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.
NOTE 7. SUBSEQUENT EVENT
The Company intends to consolidate additional plans into the ACS Savings Plan in
2002.
NOTE 8. FORM 5500
The Form 5500 is not available for review at the time of filing the audit with
the S.E.C. 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, but it is always
possible for something to occur which could require re-issuance of these
financial statements.
13
ACS SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 2001
NOTE 9. PLAN MERGERS
All assets of ACS Shared Services Plan and Business Process Solutions Savings
Plan, previously held by CIGNA, were transferred into the ACS Savings Plan and
the plan, as it previously existed, was merged in November 2001. The assets
transferred totaled approximately $4,100,000 and $900,000 respectively and were
reinvested with Fidelity in similar investments. The Statement of Changes in Net
Assets Available for Benefits includes the activity for the employees of these
companies from November 2001 through December 31, 2001.
All assets of ACS Enterprise Solutions, Inc. 401(k) Retirement Savings Plan,
previously held by VanGuard, were transferred into the ACS Savings Plan and the
plan, as it previously existed, was merged in June 2001. The assets transferred
totaled approximately $28,100,000 and were reinvested with Fidelity in similar
investments. The Statement of Changes in Net Assets Available for Benefits
includes the activity for the employees of ACS Enterprise Solutions, Inc from
June 2001 through December 31, 2001.
All assets of The Pace Group, Inc. 401(k) Profit Sharing Plan and Tyler
Technologies, Inc. 401(k) Profit Sharing Plan were transferred into the ACS
Savings Plan and the plan, as it previously existed, was merged in December
2001. The assets transferred totaled approximately $135,000 and $1,100,000
respectively and were reinvested with Fidelity in similar investments. The
Statement of Changes in Net Assets Available for Benefits includes the activity
for those employees from June 2001 through December 31, 2001.
All assets of ACS Government Systems Plan for former SCT Employees Plan were
transferred into the ACS Savings Plan and the plan, as it previously existed,
was merged in December 2001. The assets transferred totaled approximately
$16,200,000 and were reinvested with Fidelity in similar investments. The
Statement of Changes in Net Assets Available for Benefits includes the activity
for those employees from December 2001 through December 31, 2001.
All assets of Birch & Davis Associates, Inc. Money Purchase Pension Plan,
previously held by CIGNA, were transferred into the ACS Savings Plan and the
plan, as it previously existed, was merged in November 2001. The assets
transferred totaled approximately $2,700,000 and were reinvested with Fidelity
in similar investments. The Statement of Changes in Net Assets Available for
Benefits includes the activity for the employees of Birch & Davis Associates,
Inc. from November 2001 through December 31, 2001.
All assets of Birch & Davis Associates, Inc. 401(k) Plan, previously held by
CIGNA, were transferred into the ACS Savings Plan and the plan, as it previously
existed, was terminated in June 2001. The assets merged totaled approximately
$7,500,000 and were reinvested with Fidelity in similar investments. The
Statement of Changes in Net Assets Available for Benefits includes the activity
for the employees of Birch & Davis Associates, Inc. from November 2001 through
December 31, 2001.
14
ACS SAVINGS PLAN
DECEMBER 31, 2001
SUPPLEMENTAL SCHEDULE
15
ACS SAVINGS PLAN
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AT DECEMBER 31, 2001
EIN# 51-0310342
PLAN NUMBER: 001
(b)IDENTITY OF
ISSUE, BORROWER,
LESSOR, OR SIMILAR (c)DESCRIPTION OF INVESTMENT, INCLUDING MATURITY DATE, RATE OF
(a) PARTY INTEREST, COLLATERAL, PAR, OR MATURITY VALUE (d) COST (e) CURRENT VALUE
--- ------------------ -------------------------------------------------------------- -------- -----------------
* Fidelity Interest Bearing Cash $ 34,776
* Fidelity Nonemployee Corporate Common Stock 26,258
* Fidelity PIMCO Total Return Fund-Admin Class 5,108,412
* Fidelity Franklin Small Cap Growth Fund I-Class A 2,366,199
* Fidelity INVESCO Dynamics Fund 779,555
* Fidelity Brazos Real Estate Securities Fund 57,965
* Fidelity PIMCO High Yield Fund-Admin Class 54,185
* Fidelity Davis NY Venture Fund 6,987,307
* Fidelity Vanguard Global Equity Fund 647,784
* Fidelity Vanguard Balanced Fund 427,749
* Fidelity SCT Stock Fund 1,713,263
* Fidelity Interest Bearing Cash 473,934
* Fidelity ACS Stock Fund 18,109,068
* Fidelity Lockheed Martin Fund 751,114
* Fidelity Fidelity Equity-Income Fund 3,102,426
* Fidelity Fidelity Growth Company Fund 29,559,067
* Fidelity Fidelity Low-Priced Stock Fund 9,278,160
* Fidelity Fidelity Diversified Intn'l Fund 6,785,042
* Fidelity Fidelity Freedom Income Fund 197,831
* Fidelity Fidelity Freedom 2000 Fund 1,538,088
* Fidelity Fidelity Freedom 2010 Fund 2,061,159
* Fidelity Fidelity Freedom 2020 Fund 2,381,944
* Fidelity Fidelity Freedom 2030 Fund 1,137,243
* Fidelity Fidelity Money Mkt Trust: Retirement 30,794,206
* Fidelity Fidelity Spartan US Equity Index Fund 10,948,706
* Fidelity Fidelity Freedom 2040 Fund 639,383
* CIGNA Guaranteed Income Fund 678
* CIGNA Putnam Large Cap Growth Fund 777
* CIGNA Fidelity Advisor Equity Growth Fund 897
* CIGNA American Century Ultra Account 888
* CIGNA Janus Worldwide Account 890
* CIGNA ACS Stock 2,905
Participant Loans at 7% to 10.5% -- 3,881,410
-------- ------------
$ -- $139,849,269
======== ============
* Denotes a party-in-interest
16
INDEX TO EXHIBITS
EXHIBIT
NUMBER DESCRIPTION
------- -----------
23 Consent of Salmon, Beach & Company, P.C.