-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, CtR6s0KbjlhiJQA57yEkfMRrClyP6uQNuQS85fYF9iwh4U0rIYAES/jJeYu2bfP+ smD++ILN2lnU2fBEQi3OwQ== 0000912057-01-520951.txt : 20010626 0000912057-01-520951.hdr.sgml : 20010626 ACCESSION NUMBER: 0000912057-01-520951 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20001231 FILED AS OF DATE: 20010625 FILER: COMPANY DATA: COMPANY CONFORMED NAME: IMS HEALTH INC CENTRAL INDEX KEY: 0001058083 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER PROCESSING & DATA PREPARATION [7374] IRS NUMBER: 061506026 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 11-K SEC ACT: SEC FILE NUMBER: 001-14049 FILM NUMBER: 1666329 BUSINESS ADDRESS: STREET 1: 200 NYALA FARMS CITY: WESTPORT STATE: CT ZIP: 06880 BUSINESS PHONE: 2032224523 MAIL ADDRESS: STREET 1: 200 NYALA FARMS ROAD CITY: WESTPORT STATE: CT ZIP: 06880 11-K 1 a2052634z11-k.txt FORM 11-K SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 11-K (MARK ONE) (X) ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED DECEMBER 31, 2000 ----------------- OR ( ) TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 COMMISSION FILE NUMBER 001-14049 --------- --------------- IMS HEALTH INCORPORATED SAVINGS PLAN (Full title of Plan) IMS HEALTH INCORPORATED (Name of Issuer of the Securities held pursuant to the Plan) 200 NYALA FARMS, WESTPORT, CT 06880 (Address of the Plan and the Issuer's principal executive office) SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Compensation and Benefits Committee of IMS Health Incorporated has duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized. IMS Health Incorporated Savings Plan (Name of Plan) By: /s/ James C. Malone ---------------------------------------------- James C. Malone Chief Financial Officer of IMS Health Incorporated June 25, 2001 2 IMS HEALTH INCORPORATED SAVINGS PLAN DECEMBER 31, 2000 INDEX TO FORM 11-K
PAGE (S) Report of Independent Accountants .................................. 4 Financial Statements: Statements of Net Assets Available for Benefits as of December 31, 2000 and 1999 ................................ 5 Statement of Changes in Net Assets Available for Benefits for the Year ended December 31, 2000 ................................. 6 Notes to Financial Statements ...................................... 7 - 10 Supplemental Schedules: Schedule of Assets Held at End of Year .......................... 11 Schedule G - Part III ........................................... 12 - 13 Exhibit Index ...................................................... 14 Exhibit 23 - Consent of Independent Accountants .................... 15
3 REPORT OF INDEPENDENT ACCOUNTANTS To the Plan Administrator and Plan Participants of IMS Health Incorporated Savings Plan: In our opinion, the accompanying statements of net assets available for benefits and the related statement of changes in net assets available for benefits present fairly, in all material respects, the net assets available for benefits of the IMS Health Incorporated Savings Plan as of December 31, 2000 and 1999, and the changes in net assets available for benefits for the year ended December 31, 2000 in conformity with accounting principles generally accepted in the United States of America. These financial statements are the responsibility of the Plan's management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with auditing standards generally accepted in the United States of America, which 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, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. Our audits were performed for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedules listed in the index on page 3 are presented for the purpose of additional analysis and are not a required part of the basic financial statements but are supplementary information required by the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. The supplemental schedules are the responsibility of the Plan's management. The supplemental schedules have been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, are fairly stated in all material respects in relation to the basic financial statements taken as a whole. /s/ PRICEWATERHOUSECOOPERS LLP ------------------------------ PRICEWATERHOUSECOOPERS LLP New York, New York June 20, 2001 4 IMS HEALTH INCORPORATED SAVINGS PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS DOLLAR AMOUNTS IN THOUSANDS
AS OF DECEMBER 31, --------- ----------- 2000 1999 --------- ----------- Assets Investments, at fair value ..... $ 66,725 $ 89,095 Investments, at contract value . 22,351 26,455 Due from broker for securities sold ........................... - 215 Loan and interest receivable ... - 136 Receivables: Members contributions ..... - 502 Company contributions ..... - 106 ------------------------- Total Assets ................... 89,076 116,509 Liability Other liability ................ (10) - ------------------------- Net assets available for benefits ....................... $ 89,066 $116,509 ======== ========
The accompanying notes are an integral part of these financial statements. 5 IMS HEALTH INCORPORATED SAVINGS PLAN STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS FOR THE YEAR ENDED DECEMBER 31, 2000 DOLLAR AMOUNTS IN THOUSANDS
ADDITIONS TO NET ASSETS Attributed to: Investment Income: Interest and dividend income ......... $ 1,914 --------- Total Investment Income 1,914 --------- Contributions: Members ......................... 9,153 Company ......................... 2,904 Rollover ........................ 310 --------- Total Contributions 12,367 --------- Total additions ...................... 14,281 --------- DEDUCTIONS FROM NET ASSETS Attributed to: Benefits paid to members ............. (33,099) Net depreciation .................... (8,625) --------- Total Deductions (41,724) --------- Net Decrease ......................... (27,443) Net assets available for benefits: Beginning of year ............... 116,509 --------- End of year ..................... $ 89,066 =========
The accompanying notes are an integral part of these financial statements 6 IMS HEALTH INCORPORATED SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS DOLLAR AMOUNTS IN THOUSANDS NOTE 1. DESCRIPTION OF THE PLAN The following description of the IMS Health Incorporated Savings Plan (the "Plan") provides only general information. Participating members ("Members") should refer to the Plan document for a more complete description of the Plan's provisions. GENERAL The Plan is a defined contribution plan available to all U.S. employees of IMS Health Incorporated (the "Company") and certain of its subsidiaries. Full-time and regular part-time employees are eligible to participate in the Plan in the first month following their first day of employment. Temporary employees, who work at least 1,000 hours in their first year of employment, or any subsequent calendar year, are also eligible to participate. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 ("ERISA"). TRANSFERS TO OTHER FUNDS During 2000, IMS Health Incorporated sold or spun off several entities whose employees participated in the Plan. The most significant transactions were the sale of ERISCO Managed Care Technologies, Inc., effective October 3, 2000, and the spin-off of Synavant, Inc., as of August 31, 2000. As of the effective date of the transactions, the net balances of the participants of these entities were distributed or transferred into existing or newly formed savings plans sponsored by entities unaffiliated with IMS Health Incorporated. Approximately $21,600 associated with these transfers is included in the Statement of Changes in Net Assets Available for Benefits in "Benefits paid to members". NOTE 2. ACCOUNTING POLICIES BASIS OF PRESENTATION The financial statements of the Plan were prepared under the accrual method of accounting. RECLASSIFICATIONS Certain prior year balances have been reclassified to conform to the current year presentation. USE OF ESTIMATES The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of investment income and expenses during the reporting period. The most significant estimates relate to investment valuation. Actual results could differ from those estimates. RISKS AND UNCERTAINTIES The Plan provides for various investment options in any combination of stocks, bonds, fixed income securities, mutual funds, and other investment securities. Certain investment securities are exposed to various risks, such as interest rate, market and credit. Due to the level of risk associated with certain investment securities and the level of uncertainty related to changes in the value of investment securities, it is at least reasonably possible that changes in risks in the near term would materially affect members' account balances and the amounts reported in the statement of net assets available for benefits and the statement of changes in net assets available for benefits. INVESTMENTS The Plan's guaranteed investment contracts are stated at contract value, which represents the aggregate amount of deposits thereto, plus interest at the contract rate, less withdrawals. Commingled funds are valued by the fund 7 IMS HEALTH INCORPORATED SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS (CONTINUED) DOLLAR AMOUNTS IN THOUSANDS managers based on the asset values of the underlying securities as reported by the funds. Company stock is valued at its quoted market price. 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. Loans are recorded at cost, which approximates fair value. The Plan presents in the statement of changes in net assets available for benefits, the net appreciation/(depreciation) in the fair value of its investments which consists of the realized gains or losses and the unrealized appreciation/(depreciation) on those investments. CONTRIBUTIONS A member may elect to contribute 1% to 16% of compensation. A member may designate savings as before-tax Savings or after-tax Savings. A member who is a highly compensated employee may be limited to less than 16% due to the existence of certain tests required under the Internal Revenue Code (the "Code"). For 2000, the Code limit on before-tax contributions was $10,500 in the aggregate. The Company matches an amount equal to 50% of a member's savings, up to the first 6%. Member savings in excess of 6% are supplemental savings that are not matched by Company contributions. Matching Company contributions are invested in the same investment funds as the member's own contributions. VESTING Members are 100% vested in the Company's matching contributions after the third year of employment with credit given for employment with the Company's predecessors. However, a member becomes fully vested in his or her Company contribution account upon retirement, disability, death, or reaching age 65. Members are always 100% vested in their own contributions and earnings thereon. MEMBERS LOANS Members may borrow from their fund accounts a minimum of $500 up to a maximum equal to the lesser of 50% of their vested account balance or $50,000 minus the highest outstanding loan balance they had in the preceding 12 months. The maximum loan term is 57 months or up to 117 months for the purchase of a primary residence. The loans are secured by the balance in the member's account and bear interest at the prime rate at the date of the loan as published in The Wall Street Journal plus 2%. Principal and interest are paid on a monthly basis ratably through payroll deductions. The default of a loan note is deemed a taxable distribution of the unpaid balance. The loan balance was $2,280 and $2,600 as of December 31, 2000 and 1999, respectively. PAYMENTS OF BENEFITS Benefits are recorded when paid. On termination of service due to death, disability, retirement or other reasons, a member may elect to receive a lump sum amount equal to the value of the member's vested interest in his or her account, or subject to certain conditions, annual installments over a period not greater than twenty years. Members may also elect to defer distributions subject to certain conditions. FORFEITURES A member who is not 100% vested in his or her Company contributions and is terminated for reasons other than retirement, death or disability shall forfeit his or her non-vested Company contributions. Forfeited amounts shall be applied to reduce subsequent Company contributions. In the event the employee is subsequently re-employed by the Company prior to incurring 5 consecutive one year breaks in service, such forfeited amount of his or her Company contributions shall be restored to his or her account. During 2000, approximately $83 was forfeited and has been used to reduce current Company contributions. 8 IMS HEALTH INCORPORATED SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS (CONTINUED) DOLLAR AMOUNTS IN THOUSANDS ADMINISTRATIVE EXPENSES Transaction and investment manager fees for each fund are charged against the Plan's assets and related rates of return. Trustee fees and other expenses of administering the Plan are borne by the Company. GUARANTEED INVESTMENT CONTRACTS As of December 31, 2000, the market value of the Special Fixed Income Fund (which comprises of the Guaranteed Investment Contracts) totaled $22,352 with an average yield of 6.1% and an average crediting interest rate of 6.4%. PARTY-IN-INTEREST Certain Plan investments are shares of commingled funds managed by CIGNA. CIGNA is the trustee as defined by the Plan and, therefore, these transactions qualify as party-in-interest transactions. NOTE 3. FEDERAL INCOME TAX The plan is subject to the provisions of ERISA, as amended. A request for formal determination that the Plan is qualified and the trust established under the Plan is tax-exempt will be made to the Internal Revenue Service ("IRS"). 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 provisions of the Code. NOTE 4. PLAN TERMINATION While the Company has not expressed any intent to discontinue its contributions or terminate the Plan, it is free to do so at any time subject to the provisions of ERISA, as amended and the Code, which state that, in such event, all members of the Plan shall be fully vested in the amounts in their accounts. NOTE 5. INVESTMENTS The following investments represent 5% or more of the net assets available for benefits:
December 31 2000 1999 ------------------------------ Charter Large Company Stock Index - CIGNA* $40,949 $ - State Street Global Advisors Russell 2000 Index $ 6,001 $ - IMS Health Common Stock $ 6,745 $ 9,333 Barclays Global Investors Equity Index Fund A - $61,397 Barclays Global Investors Extended Equity Market Fund - $ 7,075
* party-in-interest During 2000, the Plan's investments (including gains and losses on investments bought and sold, as well as held during the year) depreciated in value as follows: Mutual funds $18 Commingled trust funds ($8,245) Common stock ($398) ----------- ($8,625) -----------
9 IMS HEALTH INCORPORATED SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS (CONTINUED) DOLLAR AMOUNTS IN THOUSANDS NOTE 6. RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500 The following is a reconciliation of net assets available for benefits per the financial statements to the Form 5500:
December 31, December 31, 2000 1999 Net assets available for benefits per the financial statements $ 89,066 $ 116,509 Amounts allocated to withdrawing members (65) (848) -------------------------- Net assets available for benefits per the Form 5500 $ 89,001 $ 115,661 ==========================
The following is a reconciliation of withdrawals and distributions paid to members per the financial statements to the Form 5500: Withdrawals and distributions paid to members per the financial statements $ 33,099 Add: Amounts requested by members for withdrawals and distributions at December 31, 2000 but paid in 2001 65 Less : Amounts requested by members for withdrawals and distributions at December 31, 1999 but paid in 2000 (848) ---------- Withdrawal and distributions paid to members per the Form 5500 $ 32,316 ==========
Withdrawals and distributions to participants recorded on the Form 5500 for benefit claims include amounts that have been processed and approved for payment prior to December 31 but not paid as of that date. 10 IMS HEALTH INCORPORATED SAVINGS PLAN SCHEDULE OF ASSETS HELD AT END OF YEAR AS OF DECEMBER 31, 2000 DOLLAR AMOUNTS IN THOUSANDS
Description of Asset Cost Fair Value - ------------------------------------------------------------ ------------- -------------- Charter Large Company Stock Index - CIGNA * $42,525 $40,949 Guaranteed Income Fund * 295 295 Allstate - Rate 6.24% Matures on 10/01/2001 990 990 Allstate - Rate 5.28% Matures on 10/01/2002 2,472 2,472 John Hancock - Rate 6.69% Matures on 04/01/2005 2,574 2,574 John Hancock - Rate 6.01% Matures on 04/01/2002 1,046 1,046 John Hancock - Rate 5.66% Matures on 04/03/2001 780 780 John Hancock - Rate 6.12% Matures on 04/02/2001 2,016 2,016 Metropolitan Life - Rate 6.69% Matures on 10/01/2005 2,009 2,009 Metropolitan Life - Rate 6.08% Matures on 10/01/2001 1,123 1,123 New York Life - Rate 7.17% Matures on 10/02/2003 3,400 3,400 New York Life - Rate 5.70% Matures on 04/01/2003 2,097 2,097 Principal Mutual - Rate 7.22% Matures on 09/30/2003 3,550 3,550 ----- ----- Subtotal - Special Fixed Income Fund 22,352 22,352 IMS Health Common Stock Fund 4,920 6,745 State Street Global Advisors Russell 2000 Index 6,996 6,001 IMS Health Balanced Index Fund - CIGNA * 4,243 4,298 State Street Global Advisors EAFE Index Account 3,750 3,316 Small Company Stock Value I Fund -Berger 1,191 1,320 Charter Large Company Stock Growth - Putnam 1,443 1,273 Templeton Foreign Account 468 489 Synavant Legacy Fund 1 53 Member Loans* - 2,280 --------------- Total Investment $89,076 ===============
* party-in-interest 11 IMS HEALTH INCORPORATED SAVINGS PLAN SCHEDULE G - PART III FINANCIAL TRANSACTIONS SCHEDULE SCHEDULE G - PART III NONEXEMPT TRANSACTIONS Name of Plan THE IMS HEALTH INCORPORATED SAVINGS PLAN Plan Sponsor IMS HEALTH INCORPORATED Three-digit plan number 002 Employer Identification Number 06-1506026 (a). Identity of party involved IMS HEALTH INCORPORATED (b). Relationship to plan, employer, or other party-in-interest PLAN SPONSOR (c). Description of transactions including maturity date, rate of interest, collateral, par or maturity value DEPOSIT OF ELECTIVE DEFERRALS EFFECTIVE MARCH 3, 2000 AND MARCH 29, 2000 DEPOSITED ON APRIL 20, 2000 AND MAY 1, 2000, RESPECTIVELY (SEE ATTACHMENT). (d). Purchase price $0 (e). Selling Price $0 (f). Lease Rental $0 (g). Expenses incurred in connection with this transaction $6,076 (h). Cost of Asset $0 (i). Current Value of Asset $0 (j). Net gain or (loss) on each transaction $0 12 IMS HEALTH INCORPORATED SAVINGS PLAN SCHEDULE G - PART III ATTACHMENT TO SCHEDULE G - PART III The deposits of elective deferrals for the IMS Health Incorporated Savings Plan (the "Plan") for the March 3, 2000 and March 29, 2000 payrolls (in the combined amount of approximately $2.1 million) were required to be submitted to the Plan's custodian no later than April 15, 2001. These transmittals were not submitted until April 20, 2000 and May 1, 2000, respectively. The late transmittal of these elective deferrals is considered an operational violation of the terms of the Plan, and, therefore, is considered a prohibited transaction. On December 19, 2000, the Company made a corrective contribution to the Plan in the amount of approximately $40,500 to offset the estimated loss incurred by the Plan participants as a result of the late transmittals. The amount of the corrective contribution was calculated by multiplying the late contribution amounts times the interest rate percentage determined by the Internal Revenue Service (the "IRS") for plan corrections (9%), prorated for the number of days from the date the contribution should have been transmitted to the date the corrective contribution was allocated to the Plan. The $40,500 was allocated among Plan participants and recorded as a qualified non-elective contribution. As a result of this reportable transaction, on December 21, 2000, the Company filed IRS Form 5330 (Return of Excise Taxes Related to Employee Benefit Plans) and paid an excise tax in the amount of $6,076. 13 IMS HEALTH INCORPORATED SAVINGS PLAN EXHIBIT INDEX EXHIBIT NO. DESCRIPTION - -------------- ----------------------------------------------------- EX - 23 Consent of Independent Accountants 14 EX-23 2 a2052634zex-23.txt EXHIBIT 23 EXHIBIT 23 CONSENT OF INDEPENDENT ACCOUNTANTS We hereby consent to the incorporation by reference in the registration statement of, among others, IMS Health Incorporated Savings Plan on Form S-8 (File No. 333-58361-1) of our report dated June 20, 2001 relating to the financial statements of the IMS Health Incorporated Savings Plan which appears in this annual report on Form 11-K. /s/ PRICEWATERHOUSECOOPERS LLP ------------------------------ PRICEWATERHOUSECOOPERS LLP New York, New York June 25, 2001 15 -----END PRIVACY-ENHANCED MESSAGE-----