11-K 1 0001.txt SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 11-K \X\ ANNUAL REPORT PURSUANT TO SECTION 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED DECEMBER 31, 1999, 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 001-00434 A. Full title of the plan and the address of the plan, if different from that of the issuer named below: The Procter & Gamble Commercial Company Employees' Savings Plan, 355 Tetuan Street, Old San Juan, P.O. Box 363187, San Juan, Puerto Rico 00936-3187 B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: The Procter & Gamble Company, One Procter & Gamble Plaza, Cincinnati, Ohio 45202 REQUIRED INFORMATION Item 4. Plan Financial Statements and Schedules Prepared in Accordance with the Financial Reporting Requirements of ERISA THE PROCTER & GAMBLE COMMERCIAL COMPANY EMPLOYEES' SAVINGS PLAN Financial Statements as of December 31, 1999 and 1998 and for the Year Ended December 31, 1999, Supplemental Schedules for the Year Ended December 31, 1999 and Independent Auditors' Report THE PROCTER & GAMBLE COMMERCIAL COMPANY EMPLOYEES' SAVINGS PLAN TABLE OF CONTENTS -------------------------------------------------------------------------------- Page Independent Auditors' Report 1 Financial Statements: Statements of Net Assets Available for Benefits as of December 31, 1999 and 1998 2 Statement of Changes in Net Assets Available for Benefits for the Year Ended December 31, 1999 3 Notes to Financial Statements 4 - 7 Supplemental Schedules: Schedule I - Item 27a - Assets Held for Investment as of December 31, 1999 8 Schedule II - Item 27d - Reportable Transactions for the Year Ended December 31, 1999 9 INDEPENDENT AUDITORS' REPORT To the Participants and Retirement Committee of The Procter & Gamble Commercial Company Employees' Savings Plan: We have audited the accompanying statements of net assets available for benefits of The Procter & Gamble Commercial Company Employees' Savings Plan (the "Plan") as of December 31, 1999 and 1998, and the related statement of changes in net assets available for benefits for the year ended December 31, 1999. 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 auditing standards generally accepted in the United States of America. 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, such financial statements present fairly, in all material respects, the net assets available for benefits of the Plan as of December 31, 1999 and 1998, and the changes in its net assets available for benefits for the year ended December 31, 1999 in conformity with accounting principles generally accepted in the United States of America. Our audits were conducted for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedules of (1) assets held for investment as of December 31, 1999 and (2) reportable transactions for the year ended December 31, 1999 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. These schedules are the responsibility of the Plan's management. Such supplemental schedules have been subjected to the auditing procedures applied in our audit of the basic 1999 financial statements and, in our opinion, are fairly stated in all material respects when considered in relation to the basic financial statements taken as a whole. /s/DELOITTE & TOUCHE LLP ------------------------ Deloitte & Touche LLP San Juan, Puerto Rico March 31, 2000 THE PROCTER & GAMBLE COMMERCIAL COMPANY EMPLOYEES' SAVINGS PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS DECEMBER 31, 1999 AND 1998 ------------------------------------------------------------------------------------- 1999 1998 INVESTMENTS (Notes 3 and 4) $5,773,102 $4,708,728 ---------- ---------- RECEIVABLES: Participants' contributions 42,180 Employer's contributions 10,592 ---------- ---------- Total receivables 52,772 ---------- ---------- Total assets 5,825,874 4,708,728 LIABILITIES - Excess contribution to be recognized next year 15,091 ---------- --------- NET ASSETS AVAILABLE FOR BENEFITS $5,810,783 $4,708,728 ========== ========== See notes to financial statements.
THE PROCTER & GAMBLE COMMERCIAL COMPANY EMPLOYEES' SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS YEARS ENDED DECEMBER 31, 1999 -------------------------------------------------------------------------------- ADDITIONS: Additions to net assets attributed to: Investment income: Net appreciation in fair value of investments (Notes 1, 3 and 4) $ 610,211 Dividends 33,616 ---------- Total investment income 643,827 ---------- Contributions: Participants 648,850 Sponsor 147,236 ---------- Total contributions 796,086 ---------- Total additions 1,439,913 DEDUCTIONS - Benefits paid to participants (337,858) ---------- NET INCREASE 1,102,055 NET ASSETS AVAILABLE FOR BENEFITS: Beginning of year 4,708,728 ---------- End of Year $5,810,783 ========== See notes to financial statements.
THE PROCTER & GAMBLE COMMERCIAL COMPANY EMPLOYEES' SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS -------------------------------------------------------------------------------- 1. DESCRIPTION OF THE PLAN The following description of The Procter & Gamble Commercial Company (the "Company") Employees' Savings Plan (the "Plan") provides only general information. Participants should refer to the Plan agreement for a more complete description of the Plan's provisions. a. GENERAL - The Plan is a defined contribution plan covering all full-time employees of the Company who are residents of Puerto Rico, have completed one year of service, and whose conditions of employment are not subject to a collective bargaining agreement, unless such agreement provides for the contrary. The Plan was established effective November 1, 1993 and is sponsored by The Procter & Gamble Commercial Company. It is subject to the provisions of the Employee Retirement Income Security Act of 1974 ("ERISA"). b. CONTRIBUTIONS - Each year, participants may contribute up to 10 percent of pretax annual compensation, as defined in the Plan. Participants may also contribute amounts representing distributions from other qualified defined benefit or contribution plans. The Company contributes 40 percent of the first 5 percent of base compensation that a participant contributes to the Plan. The matching Company contribution is invested directly in Procter & Gamble Company common stock. Contributions are subject to certain limitations. c. PARTICIPANT ACCOUNTS - Each participant's account is credited with the participant's contribution and allocations of (a) the Company's contribution and, (b) Plan earnings. Allocations are based on participant earnings or account balances, as defined. The benefit to which a participant is entitled is the benefit that can be provided from the participant's vested account. d. VESTING - Participants are vested immediately in their contributions plus actual earnings thereon. The Company's contribution portion of their accounts plus actual earnings thereon is 100 percent vested upon the occurrence of any of the following events: completion of five years of credited service; attaining age 65; total disability while employed by the Company or death while employed by the Company. e. INVESTMENT OPTIONS - Upon enrollment in the Plan, a participant may direct employee contributions in 25 percent increments in one or more of the following commingled trust investment funds that are administered by Oriental Bank & Trust (the "Trustee"): FIXED INCOME FUND - Funds are invested in shares of a registered company that invests in fixed income obligations including short-term securities issued or guaranteed by the United States government. This option consists of shares of the Fidelity Advisor Government Investment Fund - Class T. GROWTH FUND - Funds are invested in shares of a registered company that invests in diversified growth stocks of large United States and multinational companies whose earnings have been increasing consistently over the years. This option consists of shares of the Fidelity Advisor Growth Opportunities Fund - Class T. EQUITY FUND - Funds are invested in shares of a registered company that invests in common stocks of large United States and multinational companies. This option consists of shares of the Fidelity Advisor Balanced Fund - Class T. THE PROCTER & GAMBLE COMPANY COMMON STOCK FUND - Funds are invested solely in common stock of Procter & Gamble Company. Participants may change their investment options on January 1st or July 1st of any calendar year with 30 days notice. f. PAYMENT OF BENEFITS - Upon participants' termination or retirement, their vested account balance will be paid in a single lump sum in cash or in Procter & Gamble Company common stock. If participants terminate employment before retirement and the account balance in their Company matching contributions account exceeds $3,500, it will not be distributed to the participants until their 65th birthday, unless participants and their spouses (if applicable) consent in writing to an earlier distribution. g. LOANS TO PARTICIPANTS - Loans to participants are not permitted. h. FORFEITED ACCOUNTS - Forfeitures of non-vested Company contributions are used to reduce future Company contributions to the Plan. At December 31, 1999, there are no forfeited nonvested accounts. i. 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. In the event of plan termination, participants will become 100% vested in their accounts. 2. SIGNIFICANT ACCOUNTING POLICIES a. BASIS OF ACCOUNTING - The financial statements of the Plan are prepared under the accrual method of accounting. b. USE OF ESTIMATES - The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America 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 revenues and expenses during the reporting period. Actual results could differ from those estimates. c. INVESTMENTS VALUATION AND INCOME RECOGNITION - The Plan's investments are stated at fair value. Share of registered investment companies are valued at quoted market prices which represent the net asset value of shares held by the Plan at year-end. The Company stock is valued at its quoted market price. d. Purchases and sales of securities are recorded on a trade-date basis. Dividends are recorded on the ex-dividend date. e. PLAN EXPENSES - All expenses incurred in administering the Plan may be paid out of the invested assets unless paid by the Company. f. PAYMENT OF BENEFITS - Benefits are recorded when paid. g. ACCOUNTING FOR AND REPORTING OF CERTAIN DEFINED CONTRIBUTION BENEFIT PLAN INVESTMENTS AND OTHER DISCLOSURE MATTERS - The Plan adopted Statement of Position 99-3, that eliminates the requirement for a defined contribution plan that provides participant-directed investment programs to disclose amounts relating to those individual programs as a separate fund in the financial statements or in the related disclosures. 3. INVESTMENTS The following presents investments as of December 31, 1999 and 1998, that represent five percent or more of the Plan's net assets.
1999 1998 Fidelity Advisor Growth Opportunities Fund - Class T; 36,374.11 and 29,595.54 units, respectively $1,697,216 $1,482,380 Fidelity Advisor Balanced Fund - Class T; 40,959.01 and 35,436.59 units, respectively 747,502 660,654 Procter & Gamble Company - common stock; 29,211.88 and 26,862.50 shares, respectively 3,200,528 2,449,147
During 1999, the Plan's investments (including gains and losses on investments bought and sold, as well as held during the year) appreciated in value by $610,211, as follows:
Fidelity Advisor Growth Opportunities Fund - Class T $ 61,670 Fidelity Advisor Balanced Fund - Class T 33,347 Fidelity Advisor Government Investment Fund - Class T (3,025) Procter & Gamble Company - common stock 518,219 ---------- Total $ 610,211 ==========
4. NONPARTICIPANT - DIRECTED INVESTMENT Information about the net assets and the significant components of the changes in net assets relating to the nonparticipant - directed investment (Procter & Gamble Company common stock) is as follows:
1999 1998 Net assets at December 31, 1999 and 1998 - Procter & Gamble Company common stock $3,200,528 $2,449,147 ========== ========== Changes in net assets for the year ended December 31, 1999: Contributions $ 371,518 Net appreciation 518,219 Dividends 33,616 Benefits paid to participants (170,338) Net transfers to participant - directed investments (1,634) ---------- Net increase in net assets $ 751,381 ========== 5. INCOME TAXES The Plan is exempt from Puerto Rico income taxes under the provisions of the Puerto Rico Internal Revenue Code of 1994 ("PRIRC"), as amended. The Plan is not qualified under Section 401(a) of the Internal Revenue Code, but it is exempt from United States taxation under Section 1022 of the Employee Retirement Income Security Act of 1974. The Plan is required to operate in conformity with the PRIRC to maintain its qualification. The Plan participants are not taxed on the income and contributions made to their accounts until such time as the participant or the participant's beneficiary receives distributions from the Plan. ******
SCHEDULE I THE PROCTER & GAMBLE COMMERCIAL COMPANY EMPLOYEES' SAVINGS PLAN ITEM 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT DECEMBER 31, 1999 --------------------------------------------------------------------------------------------------
IDENTITY OF ISSUE UNITS COST FAIR VALUE Fidelity Advisor Government Investment Fund - Class T* 13,973.22 $ 107,830 $ 127,856 Fidelity Advisor Growth Opportunities Fund - Class T* 36,374.11 1,063,764 1,697,216 Fidelity Advisor Balanced Fund - Class T* 40,959.01 518,563 747,502 Procter & Gamble Company - common stock 29,211.88 1,703,062 3,200,528 ---------- ---------- Total Assets Held for Investment Purposes $3,393,219 $5,773,102 ========== ========== *Registered Investment Company.
SCHEDULE II THE PROCTER & GAMBLE COMMERCIAL COMPANY EMPLOYEES' SAVINGS PLAN ITEM 27d - SCHEDULE OF REPORTABLE TRANSACTIONS YEAR ENDED DECEMBER 31, 1999 ------------------------------------------------------------------------------------------------------------------------------------
CURRENT EXPENSES VALUE OF INCURRED ASSET ON NET GAIN DESCRIPTION OF NUMBER OF NUMBER OF PURCHASE SELLING WITH COST OF TRANSACTION OR (LOSS) ASSET PURCHASES SALES AMOUNT AMOUNT TRANSACTION ASSET DATE ON SALE Fidelity Advisor Government Investment Fund - Class T 21 11 $ 23,537 $ 9,564 None $ 8,046 $ 9,564 $ 1,518 Fidelity Advisor Growth Opportunities Fund - Class T 28 16 286,871 138,206 None 85,172 138,206 53,034 Fidelity Advisor Balanced Fund - Class T 26 16 115,515 59,670 None 41,923 59,670 17,747 Procter & Gamble Company - common stock 25 27 385,087 189,276 None 118,560 189,276 70,716
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. The Procter & Gamble Commercial Company Employees' Savings Plan DATE June 22, 2000 /s/MAYRA G. MELENDEZ ---------------------------------- Mayra G. Melendez For the Savings Plan Committee, Committee member of The Procter & Gamble Commercial Company Employees' Savings Plan EXHIBIT INDEX Exhibit No. Page No. 23 Consent of Deloitte & Touche