-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, PpYT4cpyg4OIz8w6bG/IFz1wKt0D3kHzAKEaJZa9BAaw4vC6K7IsbXSug6H71wew 3UI7LvXEK9rvJwPW7V3Xfg== 0000893220-94-000310.txt : 19940702 0000893220-94-000310.hdr.sgml : 19940702 ACCESSION NUMBER: 0000893220-94-000310 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19931231 FILED AS OF DATE: 19940628 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CIGNA CORP CENTRAL INDEX KEY: 0000701221 STANDARD INDUSTRIAL CLASSIFICATION: 6331 IRS NUMBER: 061059331 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 11-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-08323 FILM NUMBER: 94536057 BUSINESS ADDRESS: STREET 1: ONE LIBERTY PL 1650 MARKET ST STREET 2: P O BOX 7716 CITY: PHILADELPHIA STATE: PA ZIP: 19192-1550 BUSINESS PHONE: 2157611000 11-K 1 FORM 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 December 31, 1993 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 1-8323 -------------------------------- A. Full title of the plan and the address of the plan, if different from that of the issuer named below: CIGNA Corporation Savings and Investment Plus Plan Two Liberty Place, 17th Floor 1601 Chestnut Street P.O. Box 7716 Philadelphia, PA 19192-2172 B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: CIGNA Corporation One Liberty Place 1650 Market Street Philadelphia, PA 19192-1550 2 Required Information Financial statements and schedules for CIGNA Corporation's Savings and Investment Plus Plan, prepared in accordance with the financial reporting requirements of ERISA, appear on pages 11-K-3 through 11-K-22 of this Annual Report on Form 11-K. 11-K-2 3 SAVINGS AND INVESTMENT PLUS PLAN Financial Statements and Supplemental Schedules Years Ended December 31, 1993 and 1992 11-K-3 4 SAVINGS AND INVESTMENT PLUS PLAN TABLE OF CONTENTS
Page Number ------ Report of Independent Accountants 1 Financial Statements: Statements of Net Assets Available for Benefits 2 Statements of Changes in Net Assets Available for Benefits 3 Notes to Financial Statements 4-13 Supplemental Schedules: Schedule I - Assets Held for Investment 15 Schedule II - Party-In-Interest Transactions 16 Schedule III - Reportable Transactions 17 Schedule IV - Reconciliation of Form 5500 to Financial Statements 18
11-K-4 5 Price Waterhouse Thirty South Seventeenth Street Philadelphia, PA 19103-4094 Telephone 215-575-5000 [PRICE WATERHOUSE LOGO] REPORT OF INDEPENDENT ACCOUNTANTS June 27, 1994 To the Board of Directors of CIGNA Corporation and the Participants and Administrator of the Savings and Investment Plus Plan In our opinion, the accompanying statements of net assets available for benefits and the related statements of changes in net assets available for benefits present fairly, in all material respects, the net assets available for benefits of the Savings and Investment Plus Plan at December 31, 1993 and 1992, and the changes in net assets available for benefits for the years then ended, in conformity with generally accepted accounting principles. 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 statements in accordance with generally accepted auditing standards 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 the opinion expressed above. Our audits were made for the purpose of forming an opinion on the basic financial statements taken as a whole. The additional information included in Schedules I through IV is presented for purposes of additional analysis and is not a required part of the basic financial statements but is additional information required by ERISA. Such information has been subjected to the auditing procedures applied in the audits of the basic financial statements and, in our opinion, is fairly stated in all material respects in relation to the basic financial statements taken as a whole. /s/ PRICE WATERHOUSE 11-K-5 6 SAVINGS AND INVESTMENT PLUS PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
AS OF DECEMBER 31, ------------------------------------- 1993 1992 ASSETS Fixed Income Fund (formerly Guaranteed Fund) $ 772,747,272 $ 525,838,530 Growth and Income Fund (formerly Variable Fund) 99,286,123 94,326,490 Fidelity Advisor Growth Opportunities Fund 55,574,551 -- Stock Market Index Fund 18,533,813 -- CIGNA Stock Fund 43,512,462 39,484,065 Participant Loans 21,736,673 -- ------------- ----------- NET ASSETS AVAILABLE FOR BENEFITS $ 1,011,390,894 $ 659,649,085 ============= ===========
The Notes to Financial Statements are an integral part of these statements. - 2 - 11-K-6 7 SAVINGS AND INVESTMENT PLUS PLAN STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
YEAR ENDED DECEMBER 31, -------------------------------------------- 1993 1992 INVESTMENT INCOME Interest $ 48,035,310 $ 38,983,675 Dividends 2,030,134 2,042,368 Realized gains on sale of CIGNA stock 3,580,539 147,141 Unrealized depreciation in CIGNA stock (871,194) (1,501,910) Net investment gain from separate accounts 4,198,363 3,598,550 -------------- ------------- Total investment income 56,973,152 43,269,824 -------------- ------------- CONTRIBUTIONS Employees' contributions 69,388,945 65,740,043 Employers' contributions (net of forfeitures of $797,184 in 1993; $429,800 in 1992) 28,031,898 27,412,216 Rollover contributions 1,947,228 - -------------- ------------- Total contributions 99,368,071 93,152,259 -------------- ------------- WITHDRAWALS AND DISTRIBUTIONS (45,160,360) (46,961,623) -------------- ------------- COMMISSION EXPENSE (10,712) - -------------- ------------- NET INCREASE 111,170,151 89,460,460 TRANSFERS FROM OTHER PLANS 240,571,658 - NET ASSETS AVAILABLE FOR BENEFITS Beginning of year 659,649,085 570,188,625 -------------- ------------- End of year $ 1,011,390,894 $ 659,649,085 ============== =============
The Notes to Financial Statements are an integral part of these statements. - 3 - 11-K-7 8 SAVINGS AND INVESTMENT PLUS PLAN NOTES TO FINANCIAL STATEMENTS NOTE 1 - DESCRIPTION OF PLAN Generally, all domestic employees of CIGNA Corporation (CIGNA) and its participating subsidiaries who have completed at least one year of service are eligible to participate in the Savings and Investment Plus Plan (SIP or the Plan). The following description of the Plan provides general information only. A more complete explanation of the features and benefits available under the Plan is contained in the SIP Summary Plan Description and Prospectus. The Plan permits tax-deferred contributions to a maximum of 16% of a participant's eligible earnings. Eligible earnings were limited to $235,840 and $228,860 in 1993 and 1992, respectively. Tax-deferred contributions are accomplished by means of an employee's election, pursuant to Section 401(k) of the Internal Revenue Code, to have an amount withheld by the employer from the employee's compensation, and for the employer to remit to the employee's plan account an amount equal to such withholding. Tax-deferred contributions are also referred to herein as "employee contributions." Under the Internal Revenue Code, tax-deferred contributions were limited to $8,994 and $8,728 in 1993 and 1992, respectively. To comply with anti-discrimination provisions, tax-deferred contributions for highly compensated employees were effectively limited to 5.9% and 5.5% of eligible earnings in 1993 and 1992, respectively. CIGNA companies made matching contributions in an amount equal to 50% of the first 6% of eligible earnings contributed by participants. These matching contributions are referred to herein as "employer contributions". Employee contributions, including related investment earnings, are fully vested at all times. Employer contributions are fully vested for participants who were employees of CIGNA or one of its subsidiaries on December 31, 1984 or who were employees of CIGNA Healthplan Inc. (CHP) or one of its subsidiaries on May 6, 1988. Employer contributions for all other participants vest 20% for each year of service. Employer contributions and related investment earnings are fully vested upon an employee's attainment of retirement age, death or permanent disability, or upon the employer's termination of participation in the Plan. Upon termination of a participant's employment, that portion of employer contributions which is not vested is forfeited. Forfeited amounts are used to reduce future employer contributions. Effective July 1, 1993, the Plan began to accept rollover contributions. A rollover contribution to SIP represents a distribution a participant receives from another employer-sponsored, tax qualified, pension or profit sharing plan. Distributions from other plans are subject to certain conditions to be eligible for rollover into SIP. Effective July 1, 1993, the Plan began to permit participants to borrow a portion of their account, subject to certain limitations, at a competitive rate of interest with a specified repayment period. The loan is secured by the participant's SIP account balance. Generally, loan repayments are made by payroll deduction. The interest portion of every repayment is added to the participant's SIP account balance as earnings. Both the interest and principal portions of every repayment are allocated to the participant account according to the investment election in effect at the time of the repayment. Loan interest rates remain fixed during the term of the loan. If a default occurs, the amount of the outstanding loan balance is treated as a distribution to the participant. The defaulting participant is subject to immediate taxation on the taxable portion of the defaulted amount, including a possible 10% penalty tax. Participants may withdraw funds subject to the requirements of the Plan, and such withdrawn funds may be subject to immediate taxation and a possible 10% penalty tax. - 4 - 11-K-8 9 SAVINGS AND INVESTMENT PLUS PLAN NOTES TO FINANCIAL STATEMENTS NOTE 1 - DESCRIPTION OF PLAN (continued) On termination of employment due to death, disability, retirement or other reasons, a participant may elect to receive either a lump-sum amount equal to the value of the participant's vested interest in his or her account, monthly installments for up to 15 years, or an annuity. To the extent amounts are invested in the CIGNA Stock Fund, such amounts may be received in CIGNA common stock. Effective July 1, 1993, Plan amendments renamed two of the three existing funds and added two new investment fund options. Plan participants may elect to invest in any combination of the five funds, and are permitted to transfer assets, subject to certain restrictions, among the funds. Growth and Income Fund (formerly named the Variable Fund) - Prior to January 1, 1993, contributions to this fund were invested in Separate Account 3 (SA-3) of Connecticut General Life Insurance Company (CGLIC), a CIGNA subsidiary. SA-3, a pooled common stock fund, invested in common stock of companies chosen principally for long-term growth and capital appreciation. SA-3 was closed effective December 31, 1992. Effective January 1, 1993, the assets in this fund were transferred into Separate Account 9V (SA-9V) of CGLIC, also a pooled common stock fund. The investment focus for SA-9V is long-term growth of capital and a reasonable level of income. CIGNA Stock Fund - The CIGNA Stock Fund is invested in shares of CIGNA common stock. Such shares presently are purchased on the open market but may be acquired directly from CIGNA. From time to time, a portion of CIGNA Stock Fund assets may be invested in short-term investments. Fixed Income Fund (formerly named the Guaranteed Fund) - This fund consists of a group fixed annuity contract with CGLIC and effective December 31, 1993, as a result of a plan merger, guaranteed investment contracts maintained in an account with The Equitable Life Assurance Society of the United States (Equitable). New contributions to the fund are invested in the contract with CGLIC. Contributions or transfers into the Equitable account are not permitted. The contracts with CGLIC and Equitable guarantee the principal and accumulated interest of all funds deposited. The annual rates of interest are declared in advance and subject to change. The effective annual yields during 1993 and 1992 for CGLIC's contract were 7.5% and 8.4%, respectively. The effective annual yield of the Equitable contracts during 1993 was 8.14%, and the income on these contracts was included in the net assets merged into the Plan. Stock Market Index Fund - Contributions to this new investment option are invested in Separate Account B (SA-B) of CGLIC, a pooled common stock fund. The fund's objective is to attempt to match the performance of the Standard & Poor's 500 Composite Stock Price Index. Fidelity Advisor Growth Opportunities Fund - Contributions to this new investment option are invested in Separate Account 55A (SA- 55A) of CGLIC. All the assets of this pooled separate account are invested in the Fidelity Advisor Growth Opportunities Portfolio. The fund's objective is long-term capital growth. The Fidelity portfolio consists primarily of common stocks or securities convertible into common stocks. Mellon Bank (East) N.A., Philadelphia, Pennsylvania is the Trustee for the Plan. Contributions are received and allocated to the designated funds by CGLIC. While contributions are pending allocation, they are invested in short-term investments. - 5 - 11-K-9 10 SAVINGS AND INVESTMENT PLUS PLAN NOTES TO FINANCIAL STATEMENTS NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES Certain reclassifications have been made to the 1992 financial statements to conform to the 1993 presentation. The group fixed annuity contract with CGLIC and the guaranteed investment contracts with Equitable are stated at contract value, which approximates fair value. Contract value represents the aggregate amount on deposit, including accumulated interest. CIGNA common stock is carried at market value, which is based upon quotations obtained from national securities exchanges. Participation units in the separate accounts are valued based on the fund's net asset value, which is based on the fair value of the underlying assets of the fund. Short-term investments are carried at cost, which approximates fair value. Employers' contributions receivable is net of employee forfeitures and any excess contributions which are applied against future employer contributions. Benefits are recorded when paid. Interest income is recorded on the accrual basis. Dividend income is recorded on the ex-dividend date. Realized investment gains and losses are based on the average cost of the investments sold. Investment transactions are recorded on the trade date. NOTE 3 - PARTICIPATION IN THE PLAN Employees' contributions and employers' contributions (net of forfeitures) for the years ended December 31, 1993 and 1992 were as follows:
Employers' Employees' Contributions Contributions (Net of 1993 and Rollovers Forfeitures) ----------------------------------------------------------- ------------- ------------- CIGNA Corporation $ 3,554,204 $ 1,390,146 CIGNA Holdings, Inc. 17,583 7,318 CIGNA Dental Health, Inc. 346,415 145,370 CIGNA Healthplan, Inc. subsidiaries 6,936,582 2,710,494 CIGNA Information Services 456,625 182,159 CIGNA Investments, Inc. 1,686,297 731,384 Connecticut General Life Insurance Company 21,438,087 8,484,371 ESIS, Inc. 48,161 21,522 INA Life Insurance Company of New York 104,238 40,262 Insurance Company of North America 26,717,386 10,279,448 Life Insurance Company of North America 1,952,314 831,307 MCC Behavioral Care, Inc. 1,508,208 544,192 Montgomery and Collins, Inc. 186,969 71,165 Recovery Services International, Inc. 334,961 116,070 Ross-Loos Healthplan of California, Inc. 6,048,143 2,476,690 ---------- ---------- $71,336,173 $28,031,898 ========== ==========
- 6 - 11-K-10 11 SAVINGS AND INVESTMENT PLUS PLAN NOTES TO FINANCIAL STATEMENTS NOTE 3 - PARTICIPATION IN THE PLAN (continued)
Employers' Employees' Contributions (Net of 1992 Contributions Forfeitures) -------------------------------------------------------------------- ------------- --------------------- CIGNA Corporation $ 3,317,625 $ 1,396,689 CIGNA Dental Health, Inc. 274,863 114,222 CIGNA Healthplan, Inc. subsidiaries 5,990,628 2,496,112 CIGNA Information Services 393,546 159,489 CIGNA Investments, Inc. 1,561,705 710,291 Connecticut General Life Insurance Company 22,650,478 9,554,168 ESIS, Inc. 37,059 17,107 International Benefit Services Corp. 98,531 41,279 INA Life Insurance Company of New York 90,685 35,178 Insurance Company of North America 22,299,738 9,100,932 Life Insurance Company of North America 1,856,566 799,649 MCC Behavioral Care, Inc. 1,077,587 419,841 Montgomery and Collins, Inc. 222,645 93,772 Recovery Services International, Inc. 291,287 104,110 Ross-Loos Healthplan of California, Inc. 5,574,376 2,368,015 Self-Insurers' Management Corp. 2,724 1,362 ---------- ---------- $65,740,043 $27,412,216 ========== ==========
- 7 - 11-K-11 12 SAVINGS AND INVESTMENT PLUS PLAN NOTES TO FINANCIAL STATEMENTS Note 4 - Investments A breakdown by asset type of net assets available for benefits for each fund as of December 31, 1993 and 1992 is presented below.
FIXED GROWTH & FIDELITY ADVISOR INCOME FUND INCOME FUND GROWTH (FORMERLY (FORMERLY OPPORTUNITIES AS OF DECEMBER 31, 1993 GUARANTEED FUND) VARIABLE FUND) FUND - - - ------------------------------------------------- ---------------- ------------- --------------- Assets Investments, at fair value: Connecticut General Life Insurance Company: Fixed annuity contract $ 737,360,747 - - Separate Account 9V - $ 99,286,123 - Separate Account 55A - - $ 55,574,551 Separate Account B - - - Equitable guaranteed investment contracts 35,386,525 - - CIGNA Corporation common stock - - - Short-term investments - - - Participant loans - - - ------------- ------------ -------------- Total investments 772,747,272 99,286,123 55,574,551 Investment income receivable - - - ------------- ------------ ------------ Net assets available for benefits $ 772,747,272 $ 99,286,123 $ 55,574,551 ============= ============ ============
STOCK MARKET CIGNA PARTICIPANT AS OF DECEMBER 31, 1993 INDEX FUND STOCK FUND LOANS TOTAL - - - ------------------------------------------------- ------------- ----------- ------------- ---------------- Assets Investments, at fair value: Connecticut General Life Insurance Company: Fixed annuity contract - - - $ 737,360,747 Separate Account 9V - - - 99,286,123 Separate Account 55A - - - 55,574,551 Separate Account B $ 18,533,813 - - 18,533,813 Equitable guaranteed investment contracts - - - 35,386,525 CIGNA Corporation common stock - $ 42,723,149 - 42,723,149 Short-term investments - 274,523 - 274,523 Participant loans - - $ 21,736,673 21,736,673 ------------ ------------ ------------ ---------------- Total investments 18,533,813 42,997,672 21,736,673 1,010,876,104 Investment income receivable - 514,790 - 514,790 ------------ ------------ ------------ ---------------- Net assets available for benefits $ 18,533,813 $ 43,512,462 $ 21,736,673 $ 1,011,390,894 ============ ============ ============ ================
-8- 11-K-12 13 SAVINGS AND INVESTMENT PLUS PLAN NOTES TO FINANCIAL STATEMENTS Note 4 - Investments (continued)
GUARANTEED VARIABLE CIGNA AS OF DECEMBER 31, 1992 FUND FUND STOCK FUND TOTAL - - - --------------------------------------------- ------------ ------------ ----------------- ------------------ Assets Investments, at fair value: Connecticut General Life Insurance Company: Fixed annuity contract $ 516,753,531 - - $ 516,753,531 Separate Account 3 - $ 93,144,239 - 93,144,239 CIGNA Corporation common stock - - $ 40,474,993 40,474,993 Short-term investments 4,735,829 1,177,259 389,591 6,302,679 ------------- ------------- -------------- --------------- Total investments 521,489,360 94,321,498 40,864,584 656,675,442 Investment income receivable - - 525,321 525,321 Employers' contributions receivable, net 1,810,453 481,768 156,101 2,448,322 Interfund transfers receivable (payable) 2,538,717 (476,776) (2,061,941) - ------------- ------------- -------------- --------------- Net assets available for benefits $ 525,838,530 $ 94,326,490 $ 39,484,065 $ 659,649,085 ============= ============= ============== ===============
-9- 11-K-13 14 SAVINGS AND INVESTMENT PLUS PLAN NOTES TO FINANCIAL STATEMENTS Note 4 - Investments (continued) An analysis of the changes in net assets available for benefits by investment fund for the years ended December 31, 1993 and 1992 is presented below.
FIXED GROWTH & FIDELITY ADVISOR INCOME FUND INCOME FUND GROWTH (FORMERLY (FORMERLY OPPORTUNITIES YEAR ENDED DECEMBER 31, 1993 GUARANTEED FUND) VARIABLE FUND) FUND - - - ---------------------------------------------------- ---------------- --------------- ----------------- Investment income Interest $ 47,641,558 $ 27,525 $ 5,215 Dividends - - - Realized gains on sale of CIGNA stock - - - Unrealized depreciation in CIGNA stock - - - Net investment gain (loss) from separate accounts - 3,012,364 1,486,719 -------------- ------------ -------------- Total investment income 47,641,558 3,039,889 1,491,934 -------------- ------------ -------------- Contributions Employees' contributions 49,460,336 12,488,533 2,841,717 Employers' contributions (net of forfeitures of $ 797,184) 19,720,780 5,281,413 1,113,049 Rollover contributions 1,102,943 60,568 466,038 -------------- ------------ -------------- Total contributions 70,284,059 17,830,514 4,420,804 -------------- ------------ -------------- Loan principal repayments 1,344,969 245,862 173,769 Loan interest received - allocated 245,217 48,404 33,756 Loans issued (18,192,289) (1,636,386) (836,808) Withdrawals and distributions (36,406,714) (6,173,969) (96,665) Commission expense - - - Interfund transfers (13,478,580) (29,634,084) 45,644,843 -------------- ------------ -------------- Net increase (decrease) 51,438,220 (16,279,770) 50,831,633 Transfers from other plans 195,470,522 21,239,403 4,742,918 Net assets available for benefits Beginning of year 525,838,530 94,326,490 - -------------- ------------ -------------- End of year $ 772,747,272 $ 99,286,123 $ 55,574,551 ============== ============ ==============
STOCK MARKET CIGNA PARTICIPANT YEAR ENDED DECEMBER 31, 1993 INDEX FUND STOCK FUND LOANS TOTAL - - - ------------------------------------------------------- ------------- ------------- ------------------ -------------------- Investment income Interest $ 1,231 $ 8,626 $ 351,155 $ 48,035,310 Dividends - 2,030,134 - 2,030,134 Realized gains on sale of CIGNA stock - 3,580,539 - 3,580,539 Unrealized depreciation in CIGNA stock - (871,194) - (871,194) Net investment gain (loss) from separate accounts (300,720) - - 4,198,363 ------------ ------------- ----------------- -------------------- Total investment income (299,489) 4,748,105 351,155 56,973,152 ------------ ------------- ----------------- -------------------- Contributions Employees' contributions 542,498 4,055,861 - 69,388,945 Employers' contributions (net of forfeitures of $ 797,184) 212,217 1,704,439 - 28,031,898 Rollover contributions 292,354 25,325 - 1,947,228 ------------ ------------- ----------------- -------------------- Total contributions 1,047,069 5,785,625 - 99,368,071 ------------ ------------- ----------------- -------------------- Loan principal repayments 21,794 100,602 (1,886,996) - Loan interest received - allocated 4,619 19,159 (351,155) - Loans issued (81,681) (715,359) 21,462,523 - Withdrawals and distributions (36,894) (2,326,498) (119,620) (45,160,360) Commission expense - (10,712) - (10,712) Interfund transfers 6,491,661 (9,023,840) - - ------------ ------------- ----------------- -------------------- Net increase (decrease) 7,147,079 (1,422,918) 19,455,907 111,170,151 Transfers from other plans 11,386,734 5,451,315 2,280,766 240,571,658 Net assets available for benefits Beginning of year - 39,484,065 - 659,649,085 ------------ ------------- ----------------- -------------------- End of year $ 18,533,813 $ 43,512,462 $ 21,736,673 $ 1,011,390,894 ============ ============= ================= ====================
-10- 11-K-14 15 SAVINGS AND INVESTMENT PLUS PLAN NOTES TO FINANCIAL STATEMENTS Note 4 - Investments (continued)
GUARANTEED VARIABLE CIGNA YEAR ENDED DECEMBER 31, 1992 FUND FUND STOCK FUND TOTAL - - - ----------------------------------------------- -------------- ------------- -------------- --------------- Investment income Interest $ 38,944,086 $ 21,989 $ 17,600 $ 38,983,675 Dividends - - 2,042,368 2,042,368 Realized gains on sale of CIGNA stock - - 147,141 147,141 Unrealized depreciation in CIGNA stock - - (1,501,910) (1,501,910) Net investment gain from separate accounts - 3,598,550 - 3,598,550 ------------- ------------- -------------- --------------- Total investment income 38,944,086 3,620,539 705,199 43,269,824 ------------- ------------- -------------- --------------- Contributions Employees' contributions 49,192,421 12,608,262 3,939,360 65,740,043 Employers' contributions (net of forfeitures of $ 429,800) 20,383,383 5,350,362 1,678,471 27,412,216 ------------- ------------- -------------- --------------- Total contributions 69,575,804 17,958,624 5,617,831 93,152,259 Withdrawals and distributions (37,783,252) (6,331,473) (2,846,898) (46,961,623) Interfund transfers 3,361,755 930,371 (4,292,126) - ------------- ------------- -------------- --------------- Net increase (decrease) 74,098,393 16,178,061 (815,994) 89,460,460 Net assets available for benefits Beginning of year 451,740,137 78,148,429 40,300,059 570,188,625 ------------- ------------- -------------- --------------- End of year $ 525,838,530 $ 94,326,490 $ 39,484,065 $ 659,649,085 ============= ============= ============== ===============
-11- 11-K-15 16 SAVINGS AND INVESTMENT PLUS PLAN NOTES TO FINANCIAL STATEMENTS NOTE 5 - INCOME TAX STATUS AND CONSEQUENCES Internal Revenue Service determination letters have been received for the Plan and all Plan amendments through December 30, 1985, indicating the Plan's qualified status under Internal Revenue Code (IRC) Sections 401(a), 401(k) and 501(a). The Plan has been amended since receiving the determination letters. However, management believes the Plan is currently designed and being operated in compliance with the applicable requirements of the IRC. Accordingly, no provision has been made for federal or state income taxes in the accompanying financial statements. Under existing federal income tax law the operation of the Plan has the following general tax consequences: (a) Each employer is entitled to deduct its contributions under the Plan in computing its federal income tax liability. (b) Participating employees are not subject to federal income tax on amounts contributed by them as well as by employers for their benefit, nor with respect to any investment results realized by the Plan, until such time as amounts are distributed to them. NOTE 6 - PLAN EXPENSES The investment results of all funds except the CIGNA Stock Fund are net of management fees, investment expenses, risk charges and administrative costs charged by CGLIC. Prior to 1993, a portion of CGLIC's administrative costs were paid by CIGNA. The investment results of the contracts with Equitable are net of investment management fees and expenses charged by the Equitable. Beginning May 1, 1993 brokers commissions resulting from buying or selling stock in the CIGNA Stock Fund are paid out of the accounts of participants. Prior to that date commissions were paid by CIGNA. Other costs associated with the operation of the Plan, including trustee and legal fees, are paid by CIGNA. NOTE 7 - TERMINATION PRIORITIES CIGNA intends to continue the Plan indefinitely, but reserves the right to terminate the Plan, in whole or in part, or to discontinue contributions at any time. If the Plan is terminated or contributions are discontinued, affected participants will become fully vested. Upon Plan termination, net assets of the Plan will be distributed in the manner CIGNA elects and in accordance with ERISA and its related regulations. - 12 - 11-K-16 17 SAVINGS AND INVESTMENT PLUS PLAN NOTES TO FINANCIAL STATEMENTS NOTE 8 - PLAN MERGERS During 1993 assets totaling $240,571,658 were transferred into the Plan from several separate CIGNA related benefit plans in order to merge the plans. The merged plans, dates of merger and the net assets transferred into SIP were as follows: EQUICOR Retirement Savings Plan (December 31, 1993) $ 115,135,932 Connecticut General Employees Profit Sharing Plan: Profit Sharing Plan portion (July 1, 1993) 88,455,514 Voluntary Investment Plan portion (October 1, 1993) 12,037,298 Supplemental Retirement Account Plans (December 31, 1993) 17,850,321 Connecticut General Career Agents Deferred Compensation Plan (October 1, 1993) 3,460,058 M.C.C. Companies, Inc. Retirement Savings Plan (October 1, 1993) 2,022,528 Total Health Employee Investment Plan (October 1, 1993) 772,809 CIGNA Dental Health, Inc. 401(k) Savings Plan (October 1, 1993) 594,157 CIGNA Healthplan of Southern California Union Employees Profit Sharing Plan (October 1, 1993) 243,041 ------------ $ 240,571,658 ============
- 13 - 11-K-17 18 SUPPLEMENTAL SCHEDULES 11-K-18 19 SCHEDULE I SAVINGS AND INVESTMENT PLUS PLAN ASSETS HELD FOR INVESTMENT DECEMBER 31, 1993
Face Amount, Shares or Units Cost Market Value --------------- ------------- ------------- Fixed Income Fund: CGLIC fixed annuity contract 737,360,747 $ 737,360,747 $ 737,360,747 Equitable guaranteed investment contracts 35,386,525 35,386,525 35,386,525 Growth and Income Fund 9,305,835 97,073,116 99,286,123 Fidelity Advisor Growth Opportunities Fund 1,830,601 53,751,829 55,574,551 CIGNA Stock Fund: CIGNA Corporation common stock 680,847 35,079,945 42,723,149 Short-term investments 274,523 274,523 274,523 Stock Market Index Fund 810,453 16,670,660 18,533,813 Participant Loans 21,736,673 ------------- Total assets held for investment $ 1,010,876,104 =============
- 15 - 11-K-19 20 SCHEDULE II SAVINGS AND INVESTMENT PLUS PLAN PARTY-IN-INTEREST TRANSACTIONS YEAR ENDED DECEMBER 31, 1993 A schedule of party-in-interest transactions has not been prepared because there were no party-in-interest transactions which are prohibited by ERISA and for which there is no statutory or administrative exemption. - 16 - 11-K-20 21 SCHEDULE III SAVINGS AND INVESTMENT PLUS PLAN REPORTABLE TRANSACTIONS YEAR ENDED DECEMBER 31, 1993 (Transactions with the same person or of the same issue aggregating 5% or more of the current value of Plan assets.)
----------------- Sales ------------------- Party Involved Description of Asset Purchases Proceeds Cost Gain (Loss) - - - --------------------------- ----------------------- ----------- ----------- ----------- ----------- Connecticut General Life Insurance Company Fixed Annuity Contract $71,874,244 $68,052,784 $68,052,784 - Connecticut General Life Insurance Company Separate Account 3 - 94,326,490 58,026,371 $36,300,119 Connecticut General Life Insurance Company Separate Account 9V 112,478,795 37,444,440 36,381,637 1,062,803 Connecticut General Life Insurance Company Separate Account 55A 50,273,173 933,474 876,119 57,355
- 17 - 11-K-21 22 SCHEDULE IV SAVINGS AND INVESTMENT PLUS PLAN RECONCILIATION OF FORM 5500 TO FINANCIAL STATEMENTS STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS YEAR ENDED DECEMBER 31, 1993
Form 5500 Financial Statements --------- -------------------- Interest and dividends $ 50,065,444 $ 50,065,444 Net gain on sale of assets (A) 972,709 3,580,539 Unrealized appreciation (depreciation) of assets (A) 1,736,636 (871,194) Net investment gain from separate accounts 4,198,363 4,198,363 Contributions 99,368,071 99,368,071 Expenses (10,712) (10,712) Withdrawals (B) (41,513,822) (45,160,360) ------------- ------------- Net increase 114,816,689 111,170,151 Transfers from other plans 240,571,658 240,571,658 Net assets available for benefits: Beginning of year (B) 656,002,547 659,649,085 ------------- ------------- End of year $ 1,011,390,894 $ 1,011,390,894 ============= =============
(A) Form 5500 reporting requires that realized and unrealized investment gains and losses be determined separately based on revalued cost - that is, the current value of the assets at the beginning of the plan year, as carried forward from the end of the prior year - or historical cost if the investment was acquired since the beginning of the plan year. (B) In addition, Form 5500 reporting requires that benefits incurred but not paid be recognized at the reporting date of the Plan's net assets. However, in order to comply with guidance for accounting and disclosure by employee benefit plans, benefit obligations are recognized on a paid basis for financial statement purposes. There were no such benefit obligations incurred but not paid as of December 31, 1993. - 18 - 11-K-22 23 Exhibits Exhibits are listed in the Index to Exhibits appearing on page E-1. Signatures Pursuant to the requirements of the Securities Exchange Act of 1934, the trustees (or other persons who administer the employee benefit plan) have duly caused this annual report to be signed on its behalf by the undersigned thereunto duly authorized. SAVINGS AND INVESTMENT PLUS PLAN Date: June 28, 1994 By: /s/DAVID W. DURHAM -------------------- David Durham Plan Administrator 11-K-23 24 Index to Exhibits
Method of Number Description Filing ------ ----------- -------- 23.1 Consent of Filed herewith Independent Accountants
-E-1- EX-23.1 2 CONSENT OF INDEPENDENT ACCOUNTANTS 1 Exhibit 23.1 CONSENT OF INDEPENDENT ACCOUNTANTS We hereby consent to the incorporation by reference in the Registration Statement on Form S-8 (No. 33-51791) of CIGNA Corporation of our report dated June 27, 1994, appearing on page 11-K-5 of the Annual Report of CIGNA Corporation's Savings and Investment Plus Plan on Form 11-K for the fiscal year ended December 31, 1993. /s/PRICE WATERHOUSE Philadelphia, Pennsylvania June 28, 1994 -E-2- -----END PRIVACY-ENHANCED MESSAGE-----