-----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, UJtbUgUw4aPTjVUMiLFbZEpLLXSdl2ZhJuqUqIAQ8gxkCwIxFFpR2zISPj7ybIrs mwxJGA7pYv82kWSWWA4Eig== 0000356028-96-000007.txt : 19960927 0000356028-96-000007.hdr.sgml : 19960927 ACCESSION NUMBER: 0000356028-96-000007 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960330 FILED AS OF DATE: 19960926 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: COMPUTER ASSOCIATES INTERNATIONAL INC CENTRAL INDEX KEY: 0000356028 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-PREPACKAGED SOFTWARE [7372] IRS NUMBER: 132857434 STATE OF INCORPORATION: DE FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 11-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-09247 FILM NUMBER: 96634914 BUSINESS ADDRESS: STREET 1: ONE COMPUTER ASSOCIATES PLAZA CITY: ISLANDIA STATE: NY ZIP: 11788 BUSINESS PHONE: 5163425224 11-K 1 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 [FEE REQUIRED] For the Fiscal Year ended March 30, 1996 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 15 (D) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED] For the transition period from ____________ to ____________ Commission file number 0-10180 COMPUTER ASSOCIATES SAVINGS HARVEST PLAN (Full title of the Plan) Computer Associates International, Inc. One Computer Associates Plaza Islandia, NY 11788-7000 (Name of issuer of the securities held pursuant to the plan and the address of its principal executive office) ITEM 1. Financial Statements and Exhibits. (a) The financial statements filed herewith consist of the following: Report of Independent Auditors F-1 Statement of Net Assets Available for Benefits March 30, 1996 and 1995 F-2 Statements of Changes in Net Assets Available for Benefits Years Ended March 30, 1996 and 1995 F-4 Notes to Financial Statements - March 30, 1996 F-6 ITEM 27a - Schedule of Assets Held for Investment purposes as of March 30, 1996 F-12 ITEM 27d - Schedule of Reportable Transactions as of March 30, 1996 F-13 (b) The exhibits filed in connection with this Annual Report are as follows: Exhibit Number Document Exhibit 23 (a) Consent of Ernst & Young SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the members of the Plan Committee (who administer the Computer Associates Savings Harvest Plan) have duly caused this Annual Report to be signed by the undersigned thereunto duly authorized. COMPUTER ASSOCIATES SAVINGS HARVEST PLAN Date: September 25, 1996 By:/s/Peter Schwartz Peter Schwartz Member, Plan Committee Financial Statements and Schedules Computer Associates Savings Harvest Plan Years ended March 30, 1996 and 1995 with Report of Independent Auditors Computer Associates Savings Harvest Plan Financial Statements and Schedules Years ended March 30, 1996 and 1995
Contents Report of Independent Auditors 1 Audited Financial Statements Statements of Net Assets Available for Benefits 2 Statements of Changes in Net Assets Available for Benefits 4 Notes to Financial Statements 6 Schedules Item 27a - Schedule of Assets Held for Investment Purposes 12 Item 27d - Schedule of Reportable Transactions 13
Schedules 1 Report of Independent Auditors Administrative Committee Computer Associates Savings Harvest Plan We have audited the accompanying statements of net assets available for benefits of Computer Associates Savings Harvest Plan as of March 30, 1996 and 1995, and the related statements of changes in net assets available for the benefits for the years then ended. 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 in accordance with generally accepted auditing standards. 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 audits provide 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 benefits of the Computer Associates Savings Harvest Plan at March 30, 1996 and 1995, and the changes in its net assets available for benefits for the years then ended, in conformity with generally accepted accounting principles. Our audits were made for the purpose of forming an opinion on the financial statements taken as a whole. The accompanying supplemental schedules 27a-schedule of assets held for investment purposes as of March 30, 1996 and 27d-schedule of reportable transactions for the year ended March 30, 1996, are presented for purposes of complying with the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974, and are not a required part of the financial statements. The supplemental schedules have been subjected to the auditing procedures applied in our audit of the 1996 financial statements and, in our opinion, are fairly stated in all material respects in relation to the 1996 financial statements taken as a whole. Ernst & Young LLP September 6, 1996 2 Computer Associates Savings Harvest Plan Statement of Net Assets Available for Benefits March 30, 1996
U.S. Equity Growth and Computer Retirement Intermediate Puritan Index Magellan Income Associates Money Market Participant Total Bond Fund Fund Portfolio Fund Portfolio Stock Fund Portfolio Loans Fund ------------------------------------------------------------------------------------------------------------ Assets Investments, at fair value $398,299,929 $22,818,847 $53,919,515 $20,922,304 $52,694,872 $26,850,494 $162,934,025 $58,159,872 Loans receivable from employees 9,590,175 $9,590,175 Contributions receivable: Computer Associates International, Inc. 16,529,376 16,529,364 12 ------------------------------------------------------------------------------------------------------------- Total assets 424,419,480 22,818,847 53,919,515 20,922,304 52,694,872 26,850,494 179,463,389 58,159,884 9,590,175 Liabilities Distributions payable ------------------------------------------------------------------------------------------------------------- Total liabilities ------------------------------------------------------------------------------------------------------------- Net assets available for benefits $424,419,480 $22,818,847 $53,919,515 $20,922,304 $52,694,872 $26,850,494 $179,463,389 $58,159,884 $9,590,175 ============================================================================================================= See accompanying notes.
3 Computer Associates Savings Harvest Plan Statement of Net Assets Available for Benefits March 30, 1995
U.S. Equity Growth and Computer Retirement Intermediate Puritan Index Magellan Income Associates Money Market Participant Total Bond Fund Fund Portfolio Fund Portfolio Stock Fund Portfolio Loans Fund ------------------------------------------------------------------------------------------------------------ Assets Investments, at fair value $222,558,853 $19,424,087 $40,928,748 $13,784,687 $24,205,174 $14,258,772 $79,469,626 $30,487,759 Loans receivable from employees 7,655,895 $7,655,895 Contributions receivable: Computer Associates International, Inc. 14,966,926 14,966,911 15 ------------------------------------------------------------------------------------------------------------- Total assets 245,181,674 19,424,087 40,928,748 13,784,687 24,205,174 14,258,772 94,436,537 30,487,774 7,655,895 Liabilities Distributions payable 578,887 19,036 57,446 30,671 74,517 33,279 122,121 241,817 ------------------------------------------------------------------------------------------------------------- Total liabilities 578,887 19,036 57,446 30,671 74,517 33,279 122,121 241,817 ------------------------------------------------------------------------------------------------------------- Net assets available for benefits $244,602,787 $19,405,051 $40,871,302 $13,754,016 $24,130,657 $14,225,493 $94,314,416 $30,245,957 $7,655,895 ============================================================================================================= See accompanying notes.
4 Computer Associates Savings Harvest Plan Statement of Changes in Net Assets Available for Benefits Year ended March 30, 1996
U.S. Equity Growth and Computer Retirement Intermediate Puritan Index Magellan Income Associates Money Market Participant Total Bond Fund Fund Portfolio Fund Portfolio Stock Fund Portfolio Loans Fund ------------------------------------------------------------------------------------------------------------ Additions Contributions: Computer Associates International, Inc. $19,790,229 $ 381,171 $ 767,204 $ 342,398 $ 943,182 $ 603,760 $17,518,295 $ (765,781) Employees 35,861,049 1,346,484 2,805,215 1,396,309 4,004,080 2,478,992 4,344,268 19,485,701 Interest income from investments 11,951,440 1,459,072 2,900,995 550,506 3,432,148 1,229,913 247,958 2,130,848 Net realized and unrealized appreciation in fair value of investments 95,412,986 217,078 6,437,803 4,150,264 4,614,843 4,519,934 75,473,064 Transfer from other plan 44,722,875 4,386,601 11,665,316 19,534,997 7,444,453 1,691,508 ------------------------------------------------------------------------------------------------------------ Total additions 207,738,579 7,790,406 24,576,533 6,439,477 32,529,250 8,832,599 97,583,585 28,295,221 1,691,508 Deductions Withdrawals and distributions (27,740,675) (1,686,679)(4,190,512) (1,104,688) (5,183,540)(1,835,053) (5,888,672) (6,951,273) (900,258) Interfund transfers - net (2,684,749)(7,330,389) 1,834,083 1,220,019 5,630,115 (6,542,772) 6,730,663 1,143,030 Administrative expenses (181,211) (5,182) (7,419) (584) (1,514) (2,660) (3,168) (160,684) ------------------------------------------------------------------------------------------------------------ Total(deductions) additions (27,921,886) (4,376,610)(11,528,320) 728,811 (3,965,035) 3,792,402 (12,434,612) (381,294) 242,772 ------------------------------------------------------------------------------------------------------------ Net additions 179,816,693 3,413,796 13,048,213 7,168,288 28,564,215 12,625,001 85,148,973 27,913,927 1,934,280 Net assets available for benefits at beginning of year 244,602,787 19,405,051 40,871,302 13,754,016 24,130,657 14,225,493 94,314,416 30,245,957 7,655,895 ------------------------------------------------------------------------------------------------------------ Net assets available for benefits at end of year $424,419,480 $22,818,847 $53,919,515$20,922,304 $52,694,872$26,850,494 $179,463,389 $58,159,884 $9,590,175 ============================================================================================================ See accompanying notes.
5 Computer Associates Savings Harvest Plan Statement of Changes in Net Assets Available for Benefits Year ended March 30, 1995
U.S. Equity Growth and Computer Retirement Intermediate Puritan Index Magellan Income Associates Money Market Participant Total Bond Fund Fund Portfolio Fund Portfolio Stock Fund Portfolio Loans Fund ------------------------------------------------------------------------------------------------------------ Additions Contributions: Computer Associates International, Inc. $19,014,650 $ 443,607 $ 806,422 $ 297,343 $ 758,821 $ 500,775 $ 15,624,585 $ 583,097 Employees 13,791,023 1,356,668 2,779,842 1,022,279 2,871,212 1,854,999 2,390,788 1,515,235 Interest income from investments 8,425,176 1,503,732 3,166,840 440,998 781,563 890,265 106,098 1,535,680 Net realized and unrealized appreciation (depreciation)in fair value of investments 43,257,943 (690,918) (327,511) 1,449,900 1,032,068 553,342 41,241,062 Transfer from other plans 15,104,399 654,647 1,119,296 488,124 1,670,637 1,590,313 615,755 8,563,583 $ 402,044 -------------------------------------------------------------------------------------------------------------- Total additions 99,593,191 3,267,736 7,544,889 3,698,644 7,114,301 5,389,694 59,978,288 12,197,595 402,044 Deductions Withdrawals and distributions (17,658,125) (1,878,234) (3,265,516) (1,161,416) (1,991,972) (991,881) (3,096,531) (4,358,698) (913,877) Interfund transfers - net (2,924,477) 392,588 (1,505,172) 1,923,892 1,206,145 (11,734,292) 10,652,981 1,988,335 Administrative expenses (249,952) (6,393) (8,089) (412) (1,295) (2,155) (1,529) (230,079) -------------------------------------------------------------------------------------------------------------- Total (deductions) additions (17,908,077) (4,809,104) (2,881,017) (2,667,000) (69,375) 212,109 (14,832,352) 6,064,204 1,074,458 ============================================================================================================== Net additions (deductions) 81,685,114 (1,541,368) 4,663,872 1,031,644 7,044,926 5,601,803 45,145,936 18,261,799 1,476,502 Net assets available for benefits at beginning of year 162,917,673 20,946,419 36,207,430 12,722,372 17,085,731 8,623,690 49,168,480 11,984,158 6,179,393 -------------------------------------------------------------------------------------------------------------- Net assets available for benefits at end of year $244,602,787 $19,405,051 $40,871,302 $13,754,016 $24,130,657 $14,225,493 $94,314,416 $30,245,957 $7,655,895 ============================================================================================================== See accompanying notes.
6 Computer Associates Savings Harvest Plan Notes to Financial Statements March 30, 1996 1. Description of the Plan General The following description of the Computer Associates Savings Harvest Plan (the "Plan") provides only general information. Participants should refer to the Plan document for a more complete description of the Plan's provisions. The Plan is a defined contribution plan covering all eligible salaried employees. The Plan has been amended to allow an employee to participate in the Plan with respect to employee contributions as of the first of the month following date of hire. This change was effective November 1, 1995. Eligibility with respect to employer matching and discretionary contributions occurs in the month following completion of one full year of service to Computer Associates International, Inc. (the "Company"). The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 ("ERISA"). As a result of an acquisition by the Plan sponsor, substantially all the assets of the Legent Retirement Security were transferred into the Plan during the Plan year end March 30, 1996. Acquisitions during Plan year end March 30, 1995 resulted in the transfer of assets from The ASK Group 401(k) Plan and the Newtrend LP 401(k) Plan. The Plan has been amended for these acquisitions. Contributions During each payroll period, Plan participants may elect to contribute a percentage of their base compensation ranging from 2% to 15%. Each participant can change this election at any time but not more than once quarterly. To comply with the Tax Reform Act of 1986, pre-tax contributions elected by any participant may not exceed $9,240 for the calendar years ended December 31, 1995 and 1994. Participants can contribute on an after-tax basis as well. 7 1. Description of the Plan (continued) For eligible participants, the Company makes a matching contribution to the Plan on behalf of each participant equal to 50% of such participants contribution up to a maximum of 2.5% of the participant's base compensation. (Contributions are subject to certain IRS limitations).The matching contributions for the years ended March 30, 1996 and 1995 were $4,543,334 and $3,874,421, respectively. In addition to its matching contribution, the Company may contribute to the Plan on behalf of eligible participants, a discretionary contribution in an amount that the Board of Directors of the Company may, in its sole discretion, determine. The discretionary contributions for the years ended March 30, 1996 and 1995 were $16,529,376 and $14,966,926, respectively. The discretionary contribution is allocated to each participant generally in the same ratio that the participant's base compensation for the Plan year bears to the base compensation of all participants for such Plan year. The discretionary contribution for the year ended March 30, 1996 includes 228,385 common shares of the Company valued at $16,529,364. The discretionary contribution for the year ended March 30, 1995 includes 225,294 common shares of the Company valued at $14,966,611. It is the Company's policy to prefund employee contributions on March 31, which is the commencement of the Plan's fiscal year. However, for administrative purposes, fiscal 1997 funding of $17,000,000 was made on March 29, 1996. As the contribution was made before March 30, 1996, it has been reflected as such in the financial statements of the current Plan year ended March 30, 1996. Instructions have been made to the Plan's trustee (Fidelity Investments) to reflect the contribution as part of the Plan year ended March 30, 1997. Participant Accounts A separate account is established and maintained in the name of each participant and reflects the participants' balance invested therein. Such balance includes earnings and losses allocated to the participants accounts based upon the percentage investment of the account balance to the total fund balances. 8 1. Description of the Plan (continued) Vesting The matching and discretionary contributions made by the Company vest as follows: <3 years of service 0% Vested >3 but <4 years of service 20% Vested >4 but <5 years of service 40% Vested >5 but <6 years of service 60% Vested >6 but <7 years of service 80% Vested >7 years of service 100% Vested In addition, 100% vesting occurs upon death or total disability of a participant, upon attainment of normal retirement age, or upon termination of the Plan. Investment Options The assets of the Plan are invested by Fidelity in seven separate funds: Fidelity Intermediate Bond Fund, which invests in high and upper-medium grade fixed-income obligations with intermediate maturities. Fidelity Puritan Fund, which invests in a wide variety of securities of U.S. and foreign issuers, including some emerging markets. Fidelity Magellan Fund, which invests in common stock and securities convertible to common stock. Fidelity Growth and Income Portfolio, which invests in common stock, securities convertible to common stock, preferred stock and fixed income securities. U.S. Equity Index, which invests primarily in the common stock of the 500 companies that make up the S&P's 500 index. Computer Associates Stock Fund, which is invested in the common stock of the Company. Fidelity Retirement Money Market Portfolio, which invests in high-quality, U.S. dollar denominated money market instruments. 9 1. Description of the Plan (continued) Participants may direct future contributions or transfer their current investment balances between funds on a daily basis in increments of 1%. Payment of Benefits The Plan provides for benefit distributions to Plan participants or their beneficiaries upon the participant's retirement, termination of employment or death. Any participant may apply to withdraw all or part of his/her vested account balance subject to specific hardship withdrawal provision criteria in the Plan and the approval of the Plan Committee. Participant Loans Receivable Any participant may take a loan from his/her account based upon certain provisions of the Plan being met. Upon the death, retirement or termination of employment of the participant, the Plan may deduct the total unpaid balance or any portion thereof from any payment or distribution to which the participant or his beneficiaries may be entitled. Loans bear interest at market rates and are fixed at the time the loan is applied for. The rate at March 30, 1996 was 9.25%. All loans must be repaid in equal bi-monthly installments. Loans generally extend from one to five years. Expense Allocation To the extent that the costs of recordkeeping and administration of the funds are not covered by Plan forfeitures, they are borne by the Plan sponsor, (the Company). Such costs for Plan years 1996 and 1995 were $152,711 and $225,117, respectively, and were covered by Plan forfeitures. Plan Termination Although it has not expressed any intent 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 of ERISA. 10 1. Description of the Plan (continued) 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 amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. 2. Significant Accounting Policies Valuation of Investments Investments in Fidelity funds and Computer Associates Stock Fund are stated at fair value based upon quoted prices in published sources. The realized net gain or loss on sale of investments is the difference between the proceeds received and the average cost of investments sold. The unrealized net gain or loss is the difference between the fair value and the cost of investments for each year. These combined amounts are included in the statement of changes in net assets available for benefits. 3. Investments The following investments represent 5% or more of the Plan's net assets at March 30, 1996, which are represented at fair value as determined by quoted market prices.
Number of Units Fair Value ------------------------------ Intermediate Bond Fund 2,250,379 $ 22,818,847 Puritan Fund 3,056,661 53,919,515 U.S. Equity Index Portfolio 883,170 20,922,304 Magellan Fund 602,158 52,694,872 Growth and Income Portfolio 945,439 26,850,494 Computer Associates Stock Fund 3,633,676 162,934,025 Retirement Money Market Portfolio 58,159,872 58,159,872
11 4. Income Tax Status The Internal Revenue Service has ruled that the Plan qualifies under Section 401(a) of the Internal Revenue Code (the "Code"), and its related trust is therefore exempt from Federal income tax under Section 501 of the Code. Subsequent to the ruling, the Plan has been amended to comply with provisions of the Tax Reform Act of 1986 and the tax acts thereafter. The Plan was restated in its entirety effective March 31, 1992. The Company has received a favorable tax determination letter from the Internal Revenue Service dated June 12, 1995. The Company is not aware of any course of action or series of events that might adversely affect the qualified status of the Plan. 5. 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:
March 30, 1996 ------------ Net assets available for benefits per the financial statements $424,419,480 Amounts allocated to withdrawing participants 2,210,178 ------------ Net assets available for benefits per the Form 5500 $422,209,302 ============
The following is a reconciliation of benefits paid to participants per the financial statements to the Form 5500
Year ended March 30, 1996 --------------- Benefits paid to participants per the financial statements $ 27,740,675 Add: Amounts allocated to withdrawing participants at March 30, 1996 2,210,178 Less: Amounts allocated to withdrawing participants at March 30, 1995 578,887 --------------- Benefits paid to participants per the form 5500 $ 29,371,966 ===============
Schedules 12 Computer Associates Savings Harvest Plan Item 27a - Schedule of Assets Held for Investment Purposes March 30, 1996
Identity of Issue, Borrower, Number Current Lessor or Similar Party of Units Cost Value - ------------------------------------------------------------------- Fidelity Intermediate Bond Fund 2,250,379 $ 22,891,546 $ 22,818,847 Fidelity Puritan Fund 3,056,662 49,234,073 53,919,515 Fidelity U.S. Equity Index Portfolio 883,170 17,907,767 20,922,304 Fidelity Magellan Fund 602,158 52,676,974 52,694,872 Fidelity Growth and Income Portfolio 945,440 24,690,144 26,850,494 Fidelity Retirement Money Market Portfolio 58,159,871 58,159,872 58,159,872 Computer Associates Stock Fund 3,633,676 115,976,302 162,934,025 Participant Loans * 9,590,175 9,590,175 ------------------------- Total $351,126,853 $407,890,104 ========================= * Details available upon request.
13 Computer Associates Savings Harvest Plan Item 27d - Schedule of Reportable Transactions Year ended March 30, 1996
Number of Purchase Number Sales Cost of Net Gain Identity of Party Involved Purchases Price of Sales Price Assets (Loss) - ---------------------------------------------------------------------------------------------- Category (i) a single security transaction in excess of 5% of plan assets: Computer Associates Stock Fund 1 $ 14,966,611 Retirement Money Market Portfolio 1 17,000,000 Magellan Fund 1 19,534,997 Retirement Money Market Portfolio 1 17,000,000 Category (iii) - a series of security transactions in excess of 5% of plan assets: Computer Associates Stock Fund 252 $161,375,100 250 $153,383,866 $128,415,819 $24,968,047 Puritan Fund 250 28,818,083 244 22,265,119 21,405,753 859,366 Magellan Fund 252 61,421,831 248 37,546,975 36,134,969 1,412,006 Growth and Income Portfolio 249 23,869,064 236 15,797,277 14,967,437 829,840 Intermediate Bond Fund 249 14,512,467 229 11,334,784 11,480,745 (145,961) Retirement Money Market Portfolio 256 150,224,922 252 122,027,842 122,027,842 There were no category (ii) or (iv) reportable transactions during the period ended March 30, 1996.
EX-23 2 Exhibit 23 (a) Consent of Independent Auditors We consent to the incorporation by reference in the Registration Statement (Form S-8 No. 33-20797 and the Post Effective Amendment No. 1 to said Registration Statement and Form S-8 No. 333-04801) pertaining to the Computer Associates Savings Harvest Plan of Computer Associates International, Inc. and in the related prospectus of our report dated September 6, 1996 with respect to the financial statements and schedules of the Computer Associates Savings Harvest Plan included in this Annual Report (Form 11-K) for the year ended March 30, 1996. Ernst & Young LLP New York, New York September 25, 1996 -----END PRIVACY-ENHANCED MESSAGE-----