3.
|
FAIR VALUE MEASUREMENT
|
ASC 820, Fair Value Measures and Disclosures, establishes a framework for measuring fair value. That framework provides a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy under ASC 820 are described as follows:
|
Level 1
|
|
Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets that the plan has the ability to access.
|
|
Level 2
|
|
Inputs to the valuation methodology include
• quoted prices for similar assets or liabilities in active markets;
• quoted prices for identical or similar assets or liabilities in inactive markets;
• inputs other than quoted prices that are observable for the asset or liability;
• inputs that are derived principally from or corroborated by observable market data by correlation or other means.
If the asset or liability has a specified (contractual) term, the Level 2 input must be observable for substantially the full term of the asset or liability.
|
|
Level 3
|
|
Inputs to the valuation methodology are unobservable and significant to the fair value measurement.
|
The asset or liability's fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Valuation techniques used need to maximize the use of observable inputs and minimize the use of unobservable inputs.
All investments are measured at quoted prices in the active market and are classified as Level 1 assets as of June 30, 2016 and 2015.
The Plan's investment in Company common stock experienced net appreciation / (depreciation) in value as follows for the years ended June 30, 2016, 2015, and 2014:
|
|
2016
|
2015
|
2014
|
|
|
€
|
€
|
€
|
|
The Procter & Gamble Company common stock
|
|
|
|
|
Net appreciation/ (depreciation)
|
317,259
|
593,471
|
(73,933)
|
The realized gain on sales of Company common stock for the years ended June 30, 2016, 2015 and 2014 was determined using an average cost method as follows:
|
|
2016
|
2015
|
2014
|
|
|
€
|
€
|
€
|
|
Proceeds on sales of shares
|
498,363
|
522,866
|
299,023
|
|
Cost
|
459,290
|
393,035
|
294,589
|
|
Realised gain on sales of shares
|
39,073
|
129,831
|
4,433
|
PROCTER & GAMBLE IRELAND
EMPLOYEES SHARE OWNERSHIP PLAN (1998)
Distributions payable represent dividends and proceeds from disposals owed to participants and were €41,497 and €42,798 at June 30, 2016 and 2015, respectively. Dividends received by the Plan are separately payable to participants in accordance with the Plan agreement.
6.
|
FEDERAL INCOME TAX STATUS
|
The Plan is not qualified under Section 401(a) of the Internal Revenue Code and is exempt from the provisions of Title I of ERISA pursuant to Section 4(b) (4) thereof. The Company believes that the fiduciary should be viewed as a directed custodian and that, for U.S. tax purposes, the participating employees should be treated as the owners of the shares of the Company's common stock held for their account under the Plan.
GAAP requires plan administrators to evaluate tax positions taken by the Plan and recognize a tax liability if the Plan has taken an uncertain position that more likely than not would not be sustained upon examination by the IRS or the Department of Labor. The Plan administrators have analyzed the tax positions taken by the Plan, and have concluded that as of June 30, 2016 and 2015, there are no uncertain positions taken or expected to be taken that would require recognition of a liability or disclosure in the financial statements. The Plan has recognized no interest or penalties related to uncertain tax positions. The Plan administrators believe it is no longer subject to income tax examinations for years prior to 2013.
The Irish Tax Authority has determined and informed the Company that it is an approved Employee Share Scheme under Irish tax legislation. Therefore, the Plan Administrator believes that the Plan was qualified and tax-exempt as of June 30, 2016 and 2015 and no provision for income taxes has been reflected in the accompanying financial statements.
7.
|
PARTICIPATING PROCTER & GAMBLE COMPANIES
|
The participating Procter & Gamble Companies are as follows:
•
|
Procter & Gamble (Manufacturing) Ireland Ltd;
|
•
|
HFC Prestige Products Ltd;
|
•
|
Procter & Gamble (HABC) Ltd;
|
•
|
Procter & Gamble (L&CP) Ltd; and
|
8.
|
RELATED PARTY TRANSACTIONS
|
At June 30, 2016 and 2015, the Plan held 54,603 and 52,779 shares, respectively, of common stock of the Company, the sponsoring employer, with a cost basis of €3,569,415 and €3,211,651 respectively. Contributions from participating Procter & Gamble Companies of €566,551, €557,606 and €545,265 were recorded for the years ended June 30, 2016, 2015 and 2014 respectively.
Amounts due from participating Procter & Gamble Companies of €100,756 and €88,976 were recorded at June 30, 2016 and 2015 respectively. During the years ended June 30, 2016, 2015 and 2014, the Plan recorded dividend income from The Procter & Gamble Company common stock of €130,666, €125,084 and €110,749 respectively.
PROCTER & GAMBLE IRELAND
EMPLOYEES SHARE OWNERSHIP PLAN (1998)
Although they have not expressed any intent to do so, the participating Procter & Gamble Companies have the right under the Plan to discontinue their contributions at any time and to terminate the Plan subject to the provisions set forth in the Plan agreement.
The Company has evaluated subsequent events and transactions for potential recognition or disclosure in the financial statements through September 22, 2016, the date the financial were available to be issued. No other events have occurred that require adjustment to or disclosure in the financial statement of the Plan.
THE PLAN. Pursuant to the requirements of the Securities Exchange Act of 1934, the trustees (or other persons who administer the employees benefit plan) have duly caused this annual report to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Dublin, Ireland, on the 22 day of September 2016.
PROCTER & GAMBLE IRELAND
EMPLOYEE SHARE OWNERSHIP PLAN (1998)
/
s/ Joyce Brennan
Joyce Brennan
Director
Irish Pensions Trust Limited,
Corporate Trustee
/s/ Martin O'Callaghan
Martin O'Callaghan
Director
Irish Pensions Trust Limited,
Corporate Trustee
EXHIBIT INDEX
Exhibit No.
23
Consent of Deloitte LLP