|
|
|
|
|
|
|
NOTES TO THE FINANCIAL STATEMENTS
|
|
NOTE 1 - DESCRIPTION OF THE PLAN
The accompanying financial statements are that of the Tesoro Corporation Thrift Plan (the “Plan” or the "Thrift Plan"), a defined contribution plan of Tesoro Corporation (“Tesoro”, or the “Company”) and the following description provides only general information of the Plan. Participants should refer to the applicable formal plan documents for more complete information. The Plan is subject to, and complies with, the provisions of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”).
The Plan, originally adopted as of April 1, 1979, is a voluntary defined contribution plan open to certain non-union employees of Tesoro. Employees whose positions are covered by a collective bargaining agreement may participate if the Plan is included in the agreement.
The purpose of the Plan is to encourage Company employees to save and invest a portion of their eligible compensation, as defined, to have an additional source of income upon their retirement or disability, or for their family in the event of death. Benefits provided by the Plan are in addition to benefits that participants are entitled to receive under any other programs of the Company and under the Federal Social Security Act. The investments in the Plan are held by Fidelity Management Trust Company (“Fidelity” or the “Trustee”). Fidelity is responsible for holding, investing and accounting for the assets of the Plan and maintaining separate accounts for all participants of the Plan. The Plan is administered by the Employee Benefits Committee, consisting of individuals appointed by the Board of Directors of the Company.
PLAN MERGER.
On September 28, 2015, the Tesoro Corporation Retail Savings Plan ("Retail Plan") merged with the Plan. The trust agreement between Fidelity and Tesoro was amended, eliminating the Tesoro Corporation Savings Plan Master Trust ("Master Trust"). All assets under the Retail Plan at September 28, 2015 were transferred to the Plan and contained in the amended trust, referred to as the Tesoro Corporation Thrift Plan Trust.
PARTICIPANT CONTRIBUTIONS.
Contributions are made to the Plan by the Company on behalf of each eligible employee based upon their elected compensation deferral through payroll deductions. Individual accounts are maintained for each of the Plan’s participants. Each participant’s account is credited with the participant’s contribution, the Company’s contributions and the Plan’s earnings and charged with withdrawals and an allocation of the Plan’s losses. Allocations are based on participant earnings or account balances, as defined.
The Plan participants may elect a Roth 401(k) contribution option, allowing participants to make contributions on an after-tax basis. Under the Roth 401(k) option, accumulated investment earnings on contributions are tax free to the participant on qualified distributions. The Plan participants contributions are invested in one or more of the investment options, or the Tesoro Corporation Common Stock Fund (the “Tesoro Stock Fund”), at the option of the participant.
Participants can contribute up to 50% of eligible pay on a pre-tax, Roth, or after-tax basis, or any combination not to exceed 50% of their eligible pay. The total combined pre-tax and Roth contribution amounts cannot exceed the annual Internal Revenue Service (“IRS”) dollar limit (
$18,000
in
2015
). Employees age 50 and over may contribute additional pre-tax and/or Roth catch-up contributions (
$6,000
in
2015
) to the Plan. Certain highly compensated employees may be subject to more restrictive maximum deferrals, including no after-tax contributions. The Plan is required to return contributions received during the year in excess of the IRS limits. Refunds of employee contributions in excess of IRS or the Plan limits totaled
$25,905
and
$11,499
for the years ended
December 31, 2015
and
2014
, respectively. These refunds were distributed subsequent to December 31, and are recorded as a liability on the Statements of Net Assets Available for Benefits.
6
|
Tesoro Corporation Thrift Plan 2015
|
|
|
|
|
|
|
NOTES TO THE FINANCIAL STATEMENTS
|
|
EMPLOYER CONTRIBUTIONS.
The Plan allows for a Company match on the first 6% of base pay, for those contributing on either a pre-tax and/or Roth basis to the Plan, including “catch-up contributions.” Regular after-tax contributions, contributions on bonus pay and contributions on unscheduled overtime pay are not matched by the Company. Matching contributions made to the Plan from participants who have more than a year of service are designated safe-harbor contributions. The Company’s matching contributions are invested in one or more of the investment options, or the Tesoro Stock Fund, at the option of the participant.
The Company provides for a profit-sharing contribution to the Plan. This discretionary contribution, calculated as a percentage of employee’s base pay based on a pre-determined target for the calendar year, can range from 0% to 4% based on actual performance. Contributions will normally be made following the performance year. All employees eligible for the Plan who are employed on December 31
st
of the year the results are achieved are qualified to receive this contribution, even if they are not contributing to the Plan. If a participant does not make a deferral election, the default contribution will be to the participant’s age appropriate lifecycle fund. The Company approved a profit-sharing contribution in the amount of 4.0% and 2.5% of base pay for
2015
and
2014
, respectively. The
2015
and
2014
discretionary profit-sharing contributions to the Plan of
$23,747,386
and
$12,739,872
, respectively, were contributed by the Company in
2016
and
2015
, respectively, and are reflected as an employer contribution receivable on the Statements of Net Assets Available for Benefits.
VESTING.
Employees are fully vested at all times in their participant, safe-harbor matching, and Company non-elective contributions. Company matching contributions and any related earnings are 100% vested after one year of service. Upon voluntary termination of employment prior to normal retirement for reasons other than disability or death, an employee will be entitled to the total of his or her participant contributions to the Plan and the vested portion of the Company contributions made to the employee’s account. Generally, vesting service begins with the employment date and ends upon termination of service with the Company.
FORFEITURES.
Upon termination of service, a participant’s nonvested portion of the Company’s matching contribution may be used to reduce future employer contributions or to pay reasonable administrative expenses. At
December 31, 2015
and
2014
, the forfeited nonvested account balance was
$100,348
and
$74,162
, respectively. This account balance includes forfeited nonvested amounts, as well as uncashed stale-dated check amounts. The administrative expenses paid through the forfeited nonvested account were
$168,118
during the year ended
December 31, 2015
.
REVENUE SHARING.
Under the Plan, certain funds offer revenue sharing. During the year ended
December 31, 2015
, revenue sharing credits in the amounts of
$445,926
were used to pay administrative expenses of the Plan.
INVESTMENT OPTIONS.
Participants may elect to invest in numerous investment options offered under the Plan. Participants may change the percentage they contribute and the investment direction of their contributions. The investment menu is comprised of target date funds, actively managed funds, index funds and the Tesoro Stock Fund.
LOANS.
Generally, participants can borrow the lesser of $50,000 or one half of their vested account balance from the Plan with a minimum loan of $1,000. Such loans are secured by the participant’s vested account balance and bear interest at the prime rate plus 1%. Outstanding loans at
December 31, 2015
incur interest at rates between
4.25%
and
9.75%
for the Plan. The Plan allows for new loans with original terms of six months to five years. Upon termination of employment, the loan repayment may continue at the election of the participant. If payments are in default, the unpaid loan balance will be treated as a distribution to the participant.
PAYMENT OF BENEFITS.
Upon termination of employment, involuntary layoff, retirement, disability or death, the participant or the participant’s beneficiary (distributee) will be provided the opportunity to request a distribution from the Plan. The Plan permits at-will withdrawals of the after-tax employee contributions. Any hardship withdrawals from amounts constituting the before-tax employee contribution will result in a six-month suspension of further contributions.
Tesoro Corporation Thrift Plan 2015
|
7
|
|
|
|
|
|
|
NOTES TO THE FINANCIAL STATEMENTS
|
|
ADMINISTRATIVE EXPENSES.
The Plan allows for the payment of administrative expenses by either the Plan or the Company. Forfeited nonvested accounts and revenue sharing credits are used to pay administrative fees. Any additional fees are paid by the Company, except for those related to participant loans or withdrawals.
PLAN TERMINATION.
The Company has the right under the Plan to discontinue its contributions at any time and terminate the Plan subject to the provisions set forth in ERISA. In the event that the Plan is terminated, participants would become 100% vested in their account.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING.
The financial statements of the Plan have been prepared using the accrual method of accounting in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).
USE OF ESTIMATES.
The preparation of financial statements in conformity with U.S. GAAP requires the Plan's management to make estimates that affect the amounts reported in the financial statements and accompanying notes and supplemental schedules. Actual results could differ from those estimates.
INVESTMENT VALUATION AND INCOME RECOGNITION.
Investments held by the Plan are stated at fair value. Fair value is defined as the price that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants at the measurement date (an exit price).
Purchases and sales of securities are recorded on a trade-date basis. Interest income is recorded on an accrual basis. Dividends are recorded on the ex-dividend date.
PAYMENTS OF BENEFITS.
As of
December 31, 2015
and
2014
, there were no participant initiated withdrawals from the Plan that had not been distributed. Benefit payments are recorded when paid.
NOTES RECEIVABLE FROM PARTICIPANTS.
Notes receivable from participants represent participant loans that are recorded at their unpaid principal balance plus any accrued but unpaid interest. Interest income on notes receivable from participants is recorded when it is earned. Related fees are recorded as administrative expenses when incurred. No allowance for credit losses has been recorded as of
December 31, 2015
or
2014
. If a participant ceases to make loan repayments, and the Plan administrator deems the participant loan to be a distribution, the participant loan balance is reduced, and a benefit payment is recorded.
NEW ACCOUNTING PRONOUNCEMENTS
EMPLOYEE BENEFIT PLAN SIMPLICATION.
The Financial Accounting Standards Board issued an Accounting Standards Update ("ASU") in July 2015 (ASU No. 2015-12) that simplifies certain aspects of employee benefit plan accounting while satisfying the needs of users of financial statements, including plan participants and the Department of Labor. The guidance no longer requires fair value disclosures about investments to be disaggregated by class; rather, it permits disaggregation of investments measured using fair value only by general type, either on the face of the financial statements or in the notes to the financial statements. In addition, the ASU also eliminates the requirements to disclose the net appreciation or depreciation in fair value of investments by general type, and individual investments with a value equal to or greater than 5% of net assets available for benefits. This ASU is effective for interim and annual periods beginning after December 15, 2015, and early adoption is permitted. The Plan adopted this standard effective January 1, 2015 and applied the changes retrospectively to the prior periods presented. As a result, the statement of net assets available no longer shows the adjustment from fair value to contract value for fully benefit-responsive investment contracts separately and is instead netted with the investment in the Tesoro Corporation Savings Plan Master Trust line item.
NOTE 3 - INTEREST IN THE TESORO CORPORATION SAVINGS PLAN MASTER TRUST
The Plan’s assets were held in the Master Trust through September 28, 2015. After the merger of the Retail Plan with the Thrift Plan, the Master Trust was dissolved. The purpose of the Master Trust was the collective investment of assets of the participating plans, Thrift Plan and Retail Plan. Each participating plans’ interest in the Master Trust was based on account balances of the participants and their elected investment fund options. The Master Trust assets
8
|
Tesoro Corporation Thrift Plan 2015
|
|
|
|
|
|
|
NOTES TO THE FINANCIAL STATEMENTS
|
|
were allocated among the participating plans by assigning to each plan those transactions (primarily contributions, benefit payments, and plan-specific expenses) that can be specifically identified, and by allocating investment income and administrative expenses to the individual plans on a daily basis based on each participant’s account balance within each investment fund option.
PERCENTAGE INTERESTS IN NET ASSETS OF THE MASTER TRUST
|
|
|
|
|
|
|
Plan
|
|
December 31, 2014
|
|
Thrift Plan
|
|
99.59%
|
|
Retail Plan
|
|
0.41%
|
|
|
|
100.00%
|
PERCENTAGE INTEREST IN EACH OF THE INVESTMENT FUND OPTIONS WITHIN THE MASTER TRUST
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2014
|
|
Thrift Plan
|
|
Retail Plan
|
|
Investment Type / Fund Name
|
|
|
|
|
Common Stock
|
|
|
|
|
|
|
|
Tesoro Stock Fund
|
|
$
|
209,636,743
|
|
|
99.52
|
%
|
|
0.48
|
%
|
|
Mutual Funds
|
|
|
|
|
|
|
|
Bonds
|
|
|
|
|
|
|
|
Vanguard Total Bond Market Index Institutional
|
|
60,046,357
|
|
|
99.87
|
%
|
|
0.13
|
%
|
|
PIMCO Total Return Institutional
|
|
32,378,219
|
|
|
99.90
|
%
|
|
0.10
|
%
|
|
American Century Infl-Adj Bond Institutional
|
|
7,167,079
|
|
|
100.00
|
%
|
|
—
|
%
|
|
Equities
|
|
|
|
|
|
|
|
Spartan 500 Index Institutional
|
|
112,861,937
|
|
|
99.99
|
%
|
|
0.01
|
%
|
|
Fidelity Contrafund K
|
|
102,471,499
|
|
|
99.87
|
%
|
|
0.13
|
%
|
|
Fidelity Puritan K
|
|
71,020,389
|
|
|
99.87
|
%
|
|
0.13
|
%
|
|
Spartan Extended Market Index Advantage
|
|
50,418,841
|
|
|
100.00
|
%
|
|
—
|
%
|
|
Spartan International Index Institutional
|
|
47,999,508
|
|
|
100.00
|
%
|
|
—
|
%
|
|
Westwood SMidCap Institutional
|
|
37,297,047
|
|
|
100.00
|
%
|
|
—
|
%
|
|
William Blair SMid Cap Growth I
|
|
17,576,967
|
|
|
100.00
|
%
|
|
—
|
%
|
|
Fidelity Strategic Real Return Fund
|
|
1,006,294
|
|
|
100.00
|
%
|
|
—
|
%
|
|
Lifecycle Funds
|
|
|
|
|
|
|
|
Fidelity Freedom Index 2025
|
|
21,166,137
|
|
|
98.52
|
%
|
|
1.48
|
%
|
|
Fidelity Freedom Index 2020
|
|
20,221,552
|
|
|
96.84
|
%
|
|
3.16
|
%
|
|
Fidelity Freedom Index 2030
|
|
16,921,556
|
|
|
97.48
|
%
|
|
2.52
|
%
|
|
Fidelity Freedom Index 2035
|
|
16,074,861
|
|
|
98.32
|
%
|
|
1.68
|
%
|
|
Fidelity Freedom Index 2045
|
|
14,481,495
|
|
|
98.63
|
%
|
|
1.37
|
%
|
|
Fidelity Freedom Index 2050
|
|
12,847,714
|
|
|
97.74
|
%
|
|
2.26
|
%
|
|
Fidelity Freedom Index 2040
|
|
11,649,208
|
|
|
97.98
|
%
|
|
2.02
|
%
|
|
Fidelity Freedom Index 2015
|
|
9,212,233
|
|
|
98.25
|
%
|
|
1.75
|
%
|
|
Fidelity Freedom Index Income
|
|
1,484,370
|
|
|
99.16
|
%
|
|
0.84
|
%
|
|
Fidelity Freedom Index 2010
|
|
1,132,004
|
|
|
95.64
|
%
|
|
4.36
|
%
|
|
Fidelity Freedom Index 2005
|
|
213,612
|
|
|
87.02
|
%
|
|
12.98
|
%
|
|
Fidelity Freedom Indx 2055
|
|
90,648
|
|
|
99.90
|
%
|
|
0.10
|
%
|
|
Fidelity Freedom Indx 2060
|
|
43,050
|
|
|
100.00
|
%
|
|
—
|
%
|
|
Common/collective Trust Funds
|
|
|
|
|
|
|
|
Fidelity Managed Income Portfolio II
|
|
54,334,304
|
|
|
99.82
|
%
|
|
0.18
|
%
|
|
Artisan International Growth Trust Fund
|
|
35,648,695
|
|
|
99.97
|
%
|
|
0.03
|
%
|
|
Robeco Large Cap Value Equity Fund
|
|
25,406,797
|
|
|
99.98
|
%
|
|
0.02
|
%
|
|
Total net assets available for benefits for participating plans
|
|
990,809,116
|
|
|
|
|
|
Tesoro Corporation Thrift Plan 2015
|
9
|
|
|
|
|
|
|
NOTES TO THE FINANCIAL STATEMENTS
|
|
INVESTMENT INCOME OF THE MASTER TRUST FOR THE PERIOD FROM JANUARY 1, 2015 TO SEPTEMBER 28, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net appreciation in fair value of investments
|
|
26,238,033
|
|
|
Interest and dividend income
|
|
6,570,612
|
|
|
|
|
|
|
Total Master Trust investment income
|
|
$
|
32,808,645
|
|
NOTE 4 - FAIR VALUE MEASUREMENTS
Financial assets and financial liabilities are classified according to the fair value hierarchy. Financial assets and liabilities classified as level 1 instruments are valued based on quoted prices in active markets for identical assets and liabilities. Level 2 instruments are valued based on quoted prices for similar assets and liabilities in active markets, and inputs other than quoted prices that are observable for the asset or liability. Level 3 instruments are valued based on unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The level in the fair value hierarchy within which the fair value measurement is classified is determined based on the level of the input that is significant to the fair value measure in its entirety.
Tesoro Corporation common stock fund value is based upon the underlying Tesoro Corporation common stock closing price reported on the active market on which the individual security is traded and are categorized as level 1. Shares of mutual funds are valued using quoted market prices from national securities exchanges, which represent shares held by the Plan at year-end and are valued as level 1 fair value assets. The Plan's common/collective trust funds are measured at fair value, using NAV as a practical expedient.
PLAN ASSETS AT FAIR VALUE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Assets at Fair Value as of December 31, 2015
|
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|
Tesoro Stock Fund
|
$
|
259,713,105
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
259,713,105
|
|
|
Mutual Funds
|
695,008,072
|
|
|
—
|
|
|
—
|
|
|
695,008,072
|
|
|
Plan Assets Measured at Fair Value
|
$
|
954,721,177
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
954,721,177
|
|
|
Common/collective Trust Funds Measured at Net Asset Value
(1)
|
|
|
|
|
|
|
125,182,190
|
|
|
Total Plan Assets
|
|
|
|
|
|
|
$
|
1,079,903,367
|
|
The assets as of December 31, 2014, are presented in the Master Trust, and as such, contain both the Thrift and Retail Plan information.
MASTER TRUST ASSETS AT FAIR VALUE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Assets at Fair Value as of December 31, 2014
|
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|
Tesoro Stock Fund
|
$
|
209,636,743
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
209,636,743
|
|
|
Mutual Funds
|
665,782,577
|
|
|
—
|
|
—
|
|
665,782,577
|
|
|
Master Trust Assets Measured at Fair Value
|
$
|
875,419,320
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
875,419,320
|
|
|
Common/collective Trust Funds Measured at Net Asset Value
(1)
|
|
|
|
|
|
|
115,389,796
|
|
|
Total Master Trust Assets
|
|
|
|
|
|
|
$
|
990,809,116
|
|
10
|
Tesoro Corporation Thrift Plan 2015
|
|
|
|
|
|
|
NOTES TO THE FINANCIAL STATEMENTS
|
|
|
|
|
|
(1)
|
Common Collective Trust Funds
|
_____________________________________________________________________________________________________________
|
|
|
|
|
|
|
|
|
|
|
Common Collective Trust Name
|
|
Investment Objective
|
|
Types of Investments
|
|
Restrictions
|
|
Fidelity Managed Income Portfolio II
|
|
Deliver safety and stability by preserving principal and accumulating earnings
|
|
Benefit-Responsive Investment Contracts issued by insurance companies and other financial institutions, fixed income securities, and money market funds
|
|
No restrictions; however, the Plan is required to provide a one year redemption notice to liquidate its entire share in the funds
|
|
Artisan International Growth Fund
|
|
Seek long-term capital growth
|
|
Publicly traded corporate equities, including common and preferred stocks, warrants, and depository receipts, of non-U.S. companies across a broad capitalization range
|
|
No restrictions; however, the Trustee reserves the right to require five business days advance written notice from the Plan for withdrawal
|
|
Boston Partners Large Cap Value Equity Fund (previously, "Robeco Large Cap Value Equity Fund")
|
|
Outperform its benchmark index, the Russell 1000 Value Index
|
|
Equity securities of U.S. and non-U.S. issuers, including, without limitation, American Depository Receipts on non-U.S. issuers, that are denominated in U.S. dollars and trade in U.S. markets, including, without limitation, on U.S. exchanges or in the over-the-counter market
|
|
No restrictions; however, the Trustee reserves the right to require five business days advance written notice from the Plan for withdrawal
|
NOTE 5 - EXEMPT PARTY-IN-INTEREST TRANSACTIONS
Certain investments of the Plan are shares of mutual funds managed by Fidelity, the Trustee, as defined by the Plan. Therefore, these transactions qualify as exempt party-in-interest transactions.
At
December 31, 2015
and
2014
, the Plan held shares of common stock of the Company. The shares at
December 31, 2014
were held in the Tesoro Corporation Savings Plan Master Trust.
SHARES AND COST OF COMMON STOCK OF THE COMPANY HELD BY THE PLAN
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31,
|
|
|
|
2015
|
|
2014
|
|
Thrift Plan
|
|
|
|
|
|
Number of shares
|
|
2,402,970
|
|
|
2,768,117
|
|
|
Cost basis of shares
|
|
$
|
104,795,452
|
|
|
$
|
75,133,666
|
|
NOTE 6 - FEDERAL INCOME TAX STATUS
The Plan received a determination letter from the IRS on
December 8, 2014
, stating that the Plan is qualified
under Section 401(a) of the Internal Revenue Code (the “Code”) and, therefore, the related trust is exempt from taxation. The Plan has been amended since the most recent determination letter. Once qualified, the Plan is required to operate in conformity with the Code to maintain their qualification. The Plan's administrator believes the Plan is being operated in compliance with the applicable requirements of the Code and therefore believes the Plan, as amended, is qualified and the related trust is tax-exempt.
Tesoro Corporation Thrift Plan 2015
|
11
|
|
|
|
|
|
|
NOTES TO THE FINANCIAL STATEMENTS
|
|
U.S. GAAP requires management to evaluate uncertain tax positions taken by the Plan. The financial statement effects of a tax position are recognized when the position is more likely than not, based on the technical merits, to be sustained upon examination by the IRS. Management has analyzed the tax positions taken by the Plan and has concluded that as of
December 31, 2015
and
2014
, there are no uncertain positions taken or expected to be taken. The Plan has recognized no interest or penalties related to uncertain tax positions. The Plan is subject to routine audits by taxing jurisdictions; however, there are currently no audits for any tax periods in progress. Management believes it is no longer subject to income tax examinations for years prior to 2012.
NOTE 7 - RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500
RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2015
|
|
December 31, 2014
|
|
Net assets available for benefits reported in the financial statements
|
|
$
|
1,132,690,210
|
|
|
$
|
1,026,134,189
|
|
|
Plus adjustments from contract value to fair value for fully benefit-responsive investment contracts
|
|
—
|
|
|
792,025
|
|
|
Net assets available for plan benefits reported in the Form 5500
|
|
$
|
1,132,690,210
|
|
|
$
|
1,026,926,214
|
|
RECONCILIATION OF THE PLAN'S NET CHANGE IN NET ASSETS TO FROM 5500
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31, 2015
|
|
Net increase in net assets available for benefits reported in the financial statements
|
|
$
|
106,556,021
|
|
|
Change in adjustments from contract value to fair value for fully benefit-responsive investment contracts
|
|
(792,025
|
)
|
|
Transfer from Tesoro Corporation Retail Savings Plan upon merger
|
|
(2,305,856
|
)
|
|
Total net income reported in the Form 5500
|
|
$
|
103,458,140
|
|
As discussed in Note 2, the Plan adopted ASU 2015-12 in the current year. As a result, the Plan no longer identifies the Fidelity Managed Income Portfolio II as fully benefit-responsive investment contract. The financial statements and the Form 5500 both present the Fidelity Managed Income Portfolio II at fair value measured using the net asset value practical expedient as of December 31, 2015. The Form 5500 measured fair value in a different manner as of December 31, 2014.
NOTE 8 - RISKS AND UNCERTAINTIES
The Plan provides for investments in various securities through investment funds offered to participants, including but not limited to, various mutual funds and equity of the Company, among others. Investment securities, in general, are exposed to various risks such as interest rate, credit, liquidity and overall market volatility risk. Due to the level of risk associated with certain investment securities, it is reasonably possible that changes in the values of investment securities will occur in the near term and such changes could materially affect the amounts reported in the statements of net assets available for benefits and participant account balances.
12
|
Tesoro Corporation Thrift Plan 2015