NOTES TO FINANCIAL STATEMENTS
AS OF AND FOR THE YEARS
ENDED DECEMBER 31, 2015 AND 2014
1.
|
DESCRIPTION OF THE PLAN
|
The following description of the PerkinElmer, Inc. Savings Plan (the
Plan), as in effect for the year ended December 31, 2015, is provided for general information purposes only. Participants should refer to the Plan document for more complete information.
General
The Plan is a defined contribution plan
covering substantially all domestic employees of PerkinElmer, Inc. (the Company or the Plan Sponsor) who are not members of a collective bargaining unit or who are members of a unit that specifically provides for
participation in the Plan. The Plan also covers employees of each wholly owned domestic subsidiary that has entered into an agreement to adopt the Plan. The Plan is administered by an administrative committee (the Plan administrator),
which has overall responsibility for interpreting the provisions of the Plan and providing the trustee with any information required in the discharge of its duties. Fidelity Management Trust Company (FMTC) serves as the trustee of the
Plan. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 (ERISA).
Contributions
Participation in the Plan is voluntary. As defined in the Plan, eligibility commences the date the employee completes an hour of service for the Company.
Participants may elect to make voluntary before-tax or Roth 401(k) contributions of up to 90% of their eligible compensation subject to statutory limits, and after-tax contributions up to statutory or other limits defined by the Plan. In order
to maintain the Plans status as nondiscriminatory, the contribution amounts for highly compensated employees may be limited. Participants age 50 or over may be eligible to make additional contributions, subject to certain Internal Revenue
Code (the Code) limitations. Participants may also contribute amounts distributed to them by other qualified benefit plans.
All eligible
participants receive matching contributions on a per-pay-period basis of 100% of the first 5% of compensation up to the applicable Code limits.
As
defined in the Plan, the Company may make supplemental contributions at its discretion. There were no supplemental contributions made during 2015 or 2014.
Participant Accounts
Individual accounts are
maintained for each Plan participant. Each participants account is credited with the participants contribution, the Companys matching contribution, supplemental contributions, allocations of Plan earnings, and are charged with an
allocation of Plan losses and administrative expenses. Allocations are based on participant earnings, deferrals or account balances, as defined in the Plan. The benefit to which a participant is entitled is the benefit that can be provided from the
participants vested account.
Vesting and Forfeitures
Participants are vested immediately in their voluntary contributions plus actual earnings thereon. All active participants are vested immediately in the
Companys contribution portion of participants accounts. Also, if a participant terminated employment due to death, disability or retirement, as defined in the Plan, his or her account balance remains 100% vested.
At December 31, 2015 and 2014, forfeited accounts totaled $28,345 and $11,977, respectively. These forfeitures arose from contributions that were subject
to former vesting schedules in place prior to February 1, 2011. Forfeited balances are used to reduce future Company contributions or to pay reasonable administrative expenses of the Plan. The Companys contribution was reduced by
forfeitures of $0 and $48,378 for the years ended December 31, 2015 and 2014, respectively.
Investments
Participants direct the investment of their contributions and Company contributions into various investment options offered by the Plan. The Plan currently
offers mutual funds, common collective trust funds, participant-directed brokerage accounts, and a Company stock fund, subject to certain limitations, as investment options for participants.
-4-
Notes Receivable From Participants
Participants may borrow from their fund accounts from a minimum of $1,000 up to a maximum of $50,000 or 50% of their vested account balances, whichever is
less. The notes are secured by the balance in the participants account and bear interest at rates fixed for the term of the note by the administrative committee based on interest rates currently being charged by commercial lending
institutions. The period of repayment for any note is determined by the participant, but in no event shall that period exceed 60 months, unless the note is used to purchase a principal residence, in which case, a longer payment period is
permitted. Principal and interest are paid ratably through payroll deductions.
Payment of Benefits
Upon termination of service, a participant may receive the value of the vested interest in his or her account as a lump-sum distribution. Benefit payments to
participants are recorded upon distribution.
2.
|
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
|
Recent Accounting Pronouncements
In May 2015, the Financial Accounting Standards Board issued Accounting Standards Update 2015-07, Fair Value Measurement (Topic 820): Disclosures for
Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent) (ASU 2015-07). ASU 2015-07 removes the requirements to categorize within the fair value hierarchy all investments for which fair value is
measured using the net asset value per share practical expedient. However, sufficient information must be provided to permit a reconciliation of the fair value of assets categorized within the fair value hierarchy to the amounts presented in the
statement of financial position. ASU 2015-07 also removes the requirement to make certain disclosures for all investments that are eligible to be measured at fair value using the net asset value per share practical expedient. The Plan is required to
adopt the provisions of ASU 2015-07 for reporting periods beginning after December 15, 2015, but early adoption is permitted. The Plan will adopt ASU 2015-07 for the 2016 Plan year. Upon adoption, ASU 2015-07 will be applied retrospectively to
all periods presented. Since ASU 2015-07 only affects fair value measurement disclosures, the adoption of ASU 2015-07 will not have an effect on the face of the Plans financial statements.
In July 2015, the Financial Accounting Standards Board issued Accounting Standards Update No. 2015-12, Plan Accounting: Defined Benefit Pension Plans
(Topic 960), Defined Contribution Pension Plans (Topic 962) and Health and Welfare Benefit Plans (Topic 965): Part I Fully Benefit-Responsive Investment Contracts, Part II - Plan Investment Disclosures and Part III - Measurement Date
Practical Expedient (ASU 2015-12). The amendments in this Update remove the requirement to record fully benefit-responsive investment contracts at fair value and designate contract value as the only required measure for these contracts.
The amendments also remove the requirement to disclose (a) individual investments that represent five percent or more of net assets available for benefits and (b) the net appreciation or depreciation for investments by general type,
however, the net appreciation or depreciation in investments is still required to be presented in aggregate. This amendment also provides a practical expedient to permit plans to measure investments and investment related accounts as of a month end
date that is closest to the plans fiscal year end when the fiscal year period does not coincide with month end. The amendments in this Update are effective for fiscal years beginning after December 15, 2015. Early adoption is permitted
and the Plan will adopt ASU 2015-12 for the 2016 Plan year. Upon adoption, the amendments shall be applied retrospectively to all periods presented. The adoption of ASU 2015-12 will not have a material impact on the face of the Plans financial
statements. The Plan will be required to modify various disclosures for fully benefit-responsive investment contracts and eliminate certain disclosures related to the Plans investments.
In January 2016, the Financial Accounting Standards Board issued Accounting Standards update No. 2016-01, Financial Instruments-Overall: Recognition and
Measurement of Financial Assets and Financial Liabilities. The amendments in this Update introduce changes to current accounting for equity investments and financial liabilities under the fair value option and the presentation and disclosure
requirements for financial instruments. The amendments in this Update are effective for fiscal years beginning after December 15, 2018. Certain provisions are eligible for early adoption. The Company is in the process of evaluating the impact
of this Update on the Plans financial statements.
Basis of Accounting
The accompanying financial statements have been prepared under the accrual basis in accordance with accounting principles generally accepted in the United
States of America (GAAP).
-5-
Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of net
assets available for benefits and changes therein. Actual results could differ from those estimates.
Risks and Uncertainties
The Plan utilizes various investment instruments including common stock, mutual funds, and common collective trust funds. Investment securities, in general,
are exposed to various risks such as interest rate, credit and overall market volatility. 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 financial statements.
Investment Choices, Valuation and
Income Recognition
The Plans investments are carried at fair value. Fair value of a financial instrument is 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.
Participants direct the
investment of their contributions and Company contributions into various investment options offered by the Plan. The Companys common stock is valued at the quoted closing market price from a national securities exchange and the short-term
investments are valued at cost, which approximate fair value. Shares of mutual funds are valued at the net asset value of shares held by the Plan at year-end. One of the Plans investment options allows participants to establish a brokerage
account and select various investments consisting primarily of mutual funds, common stock, and interest bearing cash. The units of common collective trust funds are stated at fair value as determined by the issuer of the fund, Fidelity Management
and Research Company (FMR Co.), based on the net asset value of the underlying investments. The stable value portfolio is stated at fair value and then adjusted to contract value as described below. Fair value of the stable value
portfolio is the net asset value of its underlying investments, and contract value is principal plus accrued interest.
In accordance with GAAP, the
stable value portfolio is included at fair value in participant-directed investments in the statements of net assets available for benefits, and an additional line item is presented representing the adjustment from fair value to contract value. The
statements of changes in net assets available for benefits are presented on a contract value basis.
Purchases and sales of securities are recorded on a
trade-date basis. Interest income is recorded on the accrual basis. Dividends are recorded on the ex-dividend date. The Plans net appreciation (depreciation) in the fair value of its investments consists of realized gains and losses and
unrealized appreciation and depreciation on investments.
Investment Management Fees and Operating Expenses
Management fees and operating expenses charged to the Plan for investments in the mutual funds and common collective trust funds are deducted from income
earned on a daily basis and are not separately reflected. Consequently, management fees and operating expenses are reflected as a reduction of investment return for such investments.
Notes Receivable from Participants
Notes
receivable from participants are measured at their unpaid principal balance plus any accrued but unpaid interest at the end of the period. Delinquent participant loans are recorded as distributions based on the terms of the Plan document.
Payment of Benefits
Payments to participants are
recorded upon distribution.
Administrative Expenses
Administrative expenses of the Plan may be paid by either the Plan or the Company, as provided in the Plan document.
Subsequent Events
The Plan evaluated all events
and transactions that occurred after December 31, 2015 through June 20, 2016, the date these financial statements were available to be issued.
-6-
3.
|
FAIR VALUE MEASUREMENTS
|
Accounting Standards Codification 820, Fair Value Measurement (ASC
820), establishes a single authoritative definition of fair value, sets a framework for measuring fair value, and requires additional disclosures about fair value measurements. In accordance with ASC 820, the Plan classifies its
investments into Level 1, which refers to securities valued using quoted prices from active markets for identical assets; Level 2, which refers to securities not traded on an active market but for which observable market inputs are readily
available; and Level 3, which refers to securities valued based on significant unobservable inputs. Assets are classified in their entirety based on the lowest Level of input that is significant to the fair value measurement. Valuation
techniques maximize the use of relevant observable inputs and minimize the use of unobservable inputs. The Plans policy is to recognize significant transfers between Levels at the beginning of the reporting period.
The following is a description of the valuation methodologies used for assets measured at fair value. There have been no changes in the methodologies used at
December 31, 2015 and 2014.
PerkinElmer Stock Fund
The PerkinElmer Stock Fund is an employer stock unitized fund. The fund consists of PerkinElmer, Inc. common stock as well as short-term investments that
provide liquidity for daily trading. PerkinElmer, Inc. common stock is valued at the quoted closing market price from a national securities exchange and the short-term investments are valued at cost, which approximate fair value.
Mutual Funds
The Plans mutual funds are valued at
the daily closing price as reported by the fund. Mutual funds held by the Plan are open-end mutual funds that are registered with the Securities and Exchange Commission. These funds are required to publish their daily net asset value
(NAV) and to transact at that price. The mutual funds held by the Plan are deemed to be actively traded.
Participant-directed brokerage
account
A self-directed brokerage account allows Plan participants the opportunity to invest in a wide array of securities. Participants can elect to
direct their Plan assets into individual securities by establishing a Plan level brokerage account. Investments in brokerage accounts are reported at fair value. The Plan receives prices for investments in brokerage accounts from a nationally
recognized pricing service that are based on observable market transactions.
Common Collective Trust Fund
The Plans common collective trust funds are valued at the NAV of units of a bank collective trust. The NAV, as provided by the trustee, is used as a
practical expedient to estimate fair value. The NAV is based on the fair value of the underlying investments held by the fund less its liabilities. This practical expedient is not used when it is determined to be probable that the fund will sell the
investment for an amount different than the reported NAV. Participant transactions (purchases and sales) may occur daily. In the event that the Plan initiates a full redemption of the collective trust, the investment advisor reserves the right to
temporarily delay withdrawal from the trust in order to ensure that securities liquidations will be carried out in an orderly business manner.
In
accordance with the update to ASC 820, the following tables set forth by Level within the fair value hierarchy a summary of the Plans investments measured at fair value on a recurring basis at December 31, 2015 and 2014.
The Plan had no Level 3 investments as of either December 31, 2015 or December 31, 2014.
-7-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Active Markets
for Identical
Assets (Level 1)
|
|
|
Other
Observable
Inputs (Level 2)
|
|
|
December 31, 2015
Total
|
|
PerkinElmer Stock Fund
|
|
$
|
19,165,296
|
|
|
$
|
|
|
|
$
|
19,165,296
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mutual funds:
|
|
|
|
|
|
|
|
|
|
|
|
|
Domestic stock funds
|
|
|
301,584,251
|
|
|
|
|
|
|
|
301,584,251
|
|
International stock funds
|
|
|
77,162,211
|
|
|
|
|
|
|
|
77,162,211
|
|
Fixed income funds
|
|
|
48,642,389
|
|
|
|
|
|
|
|
48,642,389
|
|
Cash and other
|
|
|
13,336,110
|
|
|
|
|
|
|
|
13,336,110
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total mutual funds
|
|
|
440,724,961
|
|
|
|
|
|
|
|
440,724,961
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Participant-directed brokerage account:
|
|
|
|
|
|
|
|
|
|
|
|
|
Domestic stock funds
|
|
|
3,207,906
|
|
|
|
|
|
|
|
3,207,906
|
|
International stock funds
|
|
|
1,357,501
|
|
|
|
|
|
|
|
1,357,501
|
|
Fixed income funds
|
|
|
355,493
|
|
|
|
|
|
|
|
355,493
|
|
Cash and other
|
|
|
1,636,795
|
|
|
|
|
|
|
|
1,636,795
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total participant-directed brokerage account
|
|
|
6,557,695
|
|
|
|
|
|
|
|
6,557,695
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common collective trust funds:
|
|
|
|
|
|
|
|
|
|
|
|
|
Stable-value fund
|
|
|
|
|
|
|
65,433,709
|
|
|
|
65,433,709
|
|
Index fund
|
|
|
|
|
|
|
1,954,128
|
|
|
|
1,954,128
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total common collective trust funds
|
|
|
|
|
|
|
67,387,837
|
|
|
|
67,387,837
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
466,447,952
|
|
|
$
|
67,387,837
|
|
|
$
|
533,835,789
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Active Markets
for Identical
Assets (Level 1)
|
|
|
Other
Observable
Inputs (Level 2)
|
|
|
December 31, 2014
Total
|
|
PerkinElmer Stock Fund
|
|
$
|
17,187,781
|
|
|
$
|
|
|
|
$
|
17,187,781
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mutual funds:
|
|
|
|
|
|
|
|
|
|
|
|
|
Domestic stock funds
|
|
|
299,346,614
|
|
|
|
|
|
|
|
299,346,614
|
|
International stock funds
|
|
|
71,512,910
|
|
|
|
|
|
|
|
71,512,910
|
|
Fixed income funds
|
|
|
52,713,808
|
|
|
|
|
|
|
|
52,713,808
|
|
Cash and other
|
|
|
9,885,292
|
|
|
|
|
|
|
|
9,885,292
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total mutual funds
|
|
|
433,458,624
|
|
|
|
|
|
|
|
433,458,624
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Participant-directed brokerage account:
|
|
|
|
|
|
|
|
|
|
|
|
|
Domestic stock funds
|
|
|
2,404,729
|
|
|
|
|
|
|
|
2,404,729
|
|
International stock funds
|
|
|
1,179,300
|
|
|
|
|
|
|
|
1,179,300
|
|
Fixed income funds
|
|
|
447,012
|
|
|
|
|
|
|
|
447,012
|
|
Cash and other
|
|
|
1,558,463
|
|
|
|
|
|
|
|
1,558,463
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total participant-directed brokerage account
|
|
|
5,589,504
|
|
|
|
|
|
|
|
5,589,504
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common collective trust funds:
|
|
|
|
|
|
|
|
|
|
|
|
|
Stable-value fund
|
|
|
|
|
|
|
66,105,767
|
|
|
|
66,105,767
|
|
Index fund
|
|
|
|
|
|
|
994,220
|
|
|
|
994,220
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total common collective trust funds
|
|
|
|
|
|
|
67,099,987
|
|
|
|
67,099,987
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
456,235,909
|
|
|
$
|
67,099,987
|
|
|
$
|
523,335,896
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-8-
For the years ended December 31, 2015 and 2014, there were no significant transfers in or out of
Levels 1 or 2.
The valuation methods as described in Note 2 may produce a fair value calculation that may not be indicative of net realizable
value or reflective of future fair values. Furthermore, although the Plan believes its valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of
certain financial instruments could result in a different fair value measurement at the reporting date.
The following tables set forth additional
disclosures of the Plans investments that have fair value estimated using a NAV:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair Value Estimated Using Net Asset Value per Share
December 31, 2015
|
|
Investment
|
|
Fair Value*
|
|
|
Unfunded
Commitment
|
|
|
Redemption
Frequency
|
|
|
Other
Redemption
Restrictions
|
|
|
Redemption
Notice
Period
|
|
Stable value fund
(a)
|
|
$
|
65,433,709
|
|
|
$
|
|
|
|
|
Daily
|
|
|
|
See Above
|
|
|
|
See Above
|
|
Index fund
(b)
|
|
$
|
1,954,128
|
|
|
$
|
|
|
|
|
Daily
|
|
|
|
None
|
|
|
|
None
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair Value Estimated Using Net Asset Value per Share
December 31, 2014
|
|
Investment
|
|
Fair Value*
|
|
|
Unfunded
Commitment
|
|
|
Redemption
Frequency
|
|
|
Other
Redemption
Restrictions
|
|
|
Redemption
Notice
Period
|
|
Stable value fund
(a)
|
|
$
|
66,105,767
|
|
|
$
|
|
|
|
|
Daily
|
|
|
|
See Above
|
|
|
|
See Above
|
|
Index fund
(b)
|
|
$
|
994,220
|
|
|
$
|
|
|
|
|
Daily
|
|
|
|
None
|
|
|
|
None
|
|
*
|
The fair values of the investments have been estimated using the net asset value of the investment.
|
(a)
|
Stable value fund strategy seeks to preserve the principal investment while earning a level of interest that is consistent with the principal preservation. While it seeks to maintain a stable NAV of $1 per share, it
cannot guarantee it will be able to do so; thus, the yield of the stable value fund will fluctuate.
|
(b)
|
Index fund strategy seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the Morgan Stanley Capital International (MSCI) All Country World Index (ACWI)
Investable Market Index (IMI) Net Dividend Index SM.
|
-9-
The Plans investments that represented 5% or more of the Plans net assets
available for benefits are as follows:
|
|
|
|
|
|
|
|
|
December 31,
|
|
2015
|
|
|
2014
|
|
Fidelity Contrafund - Class K
|
|
$
|
58,917,828
|
|
|
$
|
59,350,716
|
|
Fidelity Growth Company Fund - Class K
|
|
|
78,560,090
|
|
|
|
75,940,309
|
|
Fidelity Freedom K 2020 Fund
|
|
|
27,854,288
|
|
|
|
25,829,805
|
*
|
Fidelity Freedom K 2025 Fund
|
|
|
27,621,542
|
|
|
|
25,171,175
|
*
|
Fidelity Managed Income Portfolio II Class 2
|
|
|
65,433,709
|
|
|
|
66,105,767
|
|
Vanguard Institutional Index Fund
|
|
|
40,209,359
|
|
|
|
40,578,552
|
|
*
|
Investments represented less than 5% of the Plans net assets in Plan year 2014.
|
The Plans
investments (including gains and losses on investments bought and sold, as well as held, during the year) (depreciated) appreciated in value as follows:
|
|
|
|
|
|
|
|
|
Years ended December 31,
|
|
2015
|
|
|
2014
|
|
Neuberger Berman Genesis Fund Class
R6
|
|
$
|
(2,227,544
|
)
|
|
$
|
(2,262,279
|
)
|
MSIF Emerging Markets Fund Class 1
|
|
|
(906,516
|
)
|
|
|
(938,167
|
)
|
T. Rowe Price New Horizons Fund
|
|
|
(672,448
|
)
|
|
|
(898,329
|
)
|
PIMCO Total Return Fund Institutional
CL
|
|
|
(391,198
|
)
|
|
|
(18,560
|
)
|
* Fidelity Contrafund - Class K
|
|
|
730,644
|
|
|
|
1,217,347
|
|
* Fidelity Equity - Income Fund - Class K
|
|
|
(2,773,731
|
)
|
|
|
251,508
|
|
* Fidelity Growth Company Fund - Class K
|
|
|
2,864,965
|
|
|
|
6,838,365
|
|
* Fidelity International Discovery Fund - Class
K
|
|
|
782,988
|
|
|
|
(1,471,749
|
)
|
* Fidelity Freedom K Income Fund
|
|
|
(104,604
|
)
|
|
|
(30,507
|
)
|
* Fidelity Advisor Total Bond Fund - Class Z
|
|
|
(425,679
|
)
|
|
|
|
|
* Fidelity Freedom K 2005 Fund
|
|
|
(73,996
|
)
|
|
|
(41,275
|
)
|
* Fidelity Freedom K 2010 Fund
|
|
|
(225,198
|
)
|
|
|
(201,177
|
)
|
* Fidelity Freedom K 2015 Fund
|
|
|
(722,330
|
)
|
|
|
(595,857
|
)
|
* Fidelity Freedom K 2020 Fund
|
|
|
(1,465,017
|
)
|
|
|
(983,449
|
)
|
* Fidelity Freedom K 2025 Fund
|
|
|
(1,504,921
|
)
|
|
|
(914,754
|
)
|
* Fidelity Freedom K 2030 Fund
|
|
|
(1,462,903
|
)
|
|
|
(921,443
|
)
|
* Fidelity Freedom K 2035 Fund
|
|
|
(965,287
|
)
|
|
|
(641,716
|
)
|
* Fidelity Freedom K 2040 Fund
|
|
|
(1,006,727
|
)
|
|
|
(637,055
|
)
|
* Fidelity Freedom K 2045 Fund
|
|
|
(517,196
|
)
|
|
|
(308,104
|
)
|
* Fidelity Freedom K 2050 Fund
|
|
|
(392,440
|
)
|
|
|
(199,488
|
)
|
BlackRock MSCI ACWI IMI Index Non-lendable
Fund Class F
|
|
|
(81,529
|
)
|
|
|
24,629
|
|
Vanguard Total Bond Market Fund Admiral
Shares
|
|
|
(84,003
|
)
|
|
|
(1,230
|
)
|
Vanguard Total Bond Market Fund Signal
Shares
|
|
|
|
|
|
|
21,718
|
|
Vanguard Institutional Index Fund
|
|
|
(361,509
|
)
|
|
|
4,052,982
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(11,986,179
|
)
|
|
|
1,341,410
|
|
* PerkinElmer Stock Fund
|
|
|
3,702,221
|
|
|
|
942,139
|
|
|
|
|
|
|
|
|
|
|
Net (depreciation) appreciation in fair
value of investments
|
|
$
|
(8,283,958
|
)
|
|
$
|
2,283,549
|
|
|
|
|
|
|
|
|
|
|
*
|
Represents party-in-interest to the Plan
|
-10-
5.
|
STABLE VALUE PORTFOLIO
|
The Managed Income Portfolio II (the Portfolio) is a stable value
portfolio that is a commingled pool managed by FMTC. The beneficial interest of each participant is represented by units. Units are issued and redeemed daily at the Portfolios constant net asset value (NAV) of $1 per unit. Distribution to the
Portfolios participants is declared daily from the net investment income and automatically reinvested in the Portfolio on a monthly basis, when paid. It is the policy of the Portfolio to use its best efforts to maintain a stable net asset
value of $1 per unit; although there is no guarantee that the Portfolio will be able to maintain this value.
Participants ordinarily may direct the
withdrawal or transfer of all or a portion of their investment at contract value. Contract value represents contributions made to the Portfolio, plus earnings, less participant withdrawals and administrative expenses. The Portfolio imposes certain
restrictions on the Plan, and the Portfolio itself may be subject to circumstances that impact its ability to transact at contract value (described below). Plan management believes that the occurrence of events that would cause the Portfolio to
transact at less than contract value is not probable.
Limitations on the Ability of the Portfolio to Transact at Contract Value:
Restrictions on the Plan
Participant-initiated
transactions are those transactions allowed by the Plan, including withdrawals for benefits, loans, or transfers to noncompeting funds within a plan, but excluding withdrawals that are deemed to be caused by the actions of the Plan Sponsor. The
following employer-initiated events may limit the ability of the Portfolio to transact at contract value:
|
|
|
The Plans failure to qualify under Section 401(a) or Section 401(k) of the Internal Revenue Code.
|
|
|
|
Any communication given to Plan participants by the Plan Sponsor, any other Plan fiduciary or FMTC that is designed to sway or influence a participant not to invest in the Portfolio or to transfer assets out of the
Portfolio.
|
|
|
|
Any transfer of assets from the Portfolio directly into a competing investment option.
|
|
|
|
The establishment of a defined contribution plan that competes with the Plan for employee contributions.
|
|
|
|
Withdrawals initiated by the Plan Sponsor will normally be provided at contract value as soon as practicable within twelve months following written notice of the Trustee.
|
|
|
|
Complete or partial termination of the Plan or its merger with another plan.
|
Circumstances That Impact the
Portfolio
The Portfolio invests in assets, typically fixed income securities or bond funds, and enters into wrap contracts issued by third
parties. A wrap contract is an agreement by another party, such as a bank or insurance company to make payments to the Portfolio in certain circumstances. Wrap contracts are designed to allow a stable value portfolio to maintain a constant NAV and
to protect a portfolio in extreme circumstances. In a typical wrap contract, the wrap issuer agrees to pay a portfolio the difference between the contract value and the market value of the underlying assets once the market value has been totally
exhausted.
The wrap contracts generally contain provisions that limit the ability of the Portfolio to transact at contract value upon the occurrence of
certain events. These events include:
|
|
|
Any substantive modification of the Portfolio or the administration of the Portfolio that is not consented to by the wrap issuer.
|
|
|
|
Any change in law, regulation, or administrative ruling applicable to a plan that could have a material adverse effect on the Portfolios cash flow.
|
|
|
|
Employer-initiated transactions by participating plans as described above.
|
In the event that wrap contracts
fail to perform as intended, the Portfolios NAV may decline if the market value of its assets declines. The Portfolios ability to receive amounts due pursuant to these wrap contracts is dependent on the third-party issuers ability
to meet their financial obligations. The wrap issuers ability to meet its contractual obligations under the wrap contracts may be affected by future economic and regulatory developments.
The Portfolio is unlikely to maintain a stable NAV if, for any reason, it cannot obtain or maintain wrap contracts covering all of its underlying assets. This
could result from the Portfolios inability to promptly find a replacement wrap contract following termination of a wrap contract. Wrap contracts are non-transferable and have no trading market. There are a limited number of wrap issuers. The
Portfolio may lose the benefit of wrap contracts on any portion of its assets in default in excess of a certain percentage of Portfolio assets.
-11-
6.
|
RELATED-PARTY TRANSACTIONS
|
Certain Plan investments are shares of mutual funds managed by FMR Co.,
an affiliate of FMTC. These transactions qualify as party-in-interest transactions. Administrative fees paid by the Plan for the investment management services provided by the trustee were $31,325 and $31,828 for the years ended December 31,
2015 and 2014, respectively.
At December 31, 2015 and 2014, the Plan held 353,475 and 384,254 shares, respectively, of common stock of the Company,
the Plan Sponsor. During the years ended December 31, 2015 and 2014, the Plan recorded dividend income from the Companys stock of $147,656 and $120,733, respectively.
Participant notes receivable also qualify as party-in-interest transactions.
7.
|
FEDERAL INCOME TAX STATUS
|
The Internal Revenue Service has determined and informed the Company by a
letter dated May 29, 2014, that the Plan and related trust were designed in accordance with the applicable regulations of the Code. The Plan has been amended since receiving the determination letter; however, the Company and the Plan
administrator believe that the Plan is currently designed and operated in compliance with the applicable requirements of the Code, and the Plan and related trust continue to be tax-exempt. Therefore, no provision for income taxes has been included
in the Plans financial statements.
GAAP requires Plan management to evaluate tax positions taken by the Plan and recognize a tax liability (or
asset) if the Plan has taken an uncertain position that more likely than not would not be sustained upon examination by the Internal Revenue Service. The Plan administrator has analyzed the tax positions taken by the Plan, and has concluded
that as of December 31, 2015, there are no uncertain positions taken or expected to be taken that would require recognition of a liability (or asset) or disclosure in the financial statements. The Plan is subject to routine audits by
taxing jurisdictions.
Although it has not expressed any intention to do so, the Company has the right, under
the Plan, to discontinue its contributions at any time and to terminate the Plan subject to the provisions set forth in ERISA. In the event that the Plan is terminated, participants would remain 100% vested in their accounts.
9.
|
RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500
|
The Company is reporting, in the Plans
Form 5500, the Plans investment in a fully-benefit responsive stable-value fund, at fair value, at December 31, 2015 and 2014. The following is a reconciliation of net assets available per the financial statements to the
Form 5500:
|
|
|
|
|
|
|
|
|
December 31,
|
|
2015
|
|
|
2014
|
|
Net assets available for benefits per financial statements
|
|
$
|
540,987,114
|
|
|
$
|
529,941,318
|
|
Adjustment from contract value to fair value for fully
benefit-responsive stable-value fund
|
|
|
466,427
|
|
|
|
951,427
|
|
|
|
|
|
|
|
|
|
|
Net Assets Available per the Form 5500
|
|
$
|
541,453,541
|
|
|
$
|
530,892,745
|
|
|
|
|
|
|
|
|
|
|
The following is a reconciliation of the increase in net assets per the financial statements to net income per the
Form 5500:
|
|
|
|
|
|
|
|
|
Years ended December 31,
|
|
2015
|
|
|
2014
|
|
Increase in net assets per the financial statements
|
|
$
|
11,045,796
|
|
|
$
|
18,860,163
|
|
Change in adjustment from contract value to fair value for fully benefit-responsive stable-value
fund:
|
|
|
|
|
|
|
|
|
Beginning of year
|
|
|
(951,427
|
)
|
|
|
(1,029,694
|
)
|
End of year
|
|
|
466,427
|
|
|
|
951,427
|
|
|
|
|
|
|
|
|
|
|
Net Income per the Form 5500
|
|
$
|
10,560,796
|
|
|
$
|
18,781,896
|
|
|
|
|
|
|
|
|
|
|
-12-
SUPPLEMENTAL SCHEDULE
-13-