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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
ANNUAL REPORT
PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
(Mark One) | |
ý | ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the fiscal year ended December 31, 2003 | |
OR | |
o | TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to . |
Commission File Number 001-15577
- A.
- Full title of the plan and the address of the plan, if different from that of the issuer named below:
Qwest Savings & Investment Plan
- B.
- Name of issuer of the securities held pursuant to the plan and the address of its principal executive office:
Qwest Communications International Inc.
1801 California, Denver, Colorado 80202
303-992-1400
| Page(s) | |
---|---|---|
Required Information | 2 | |
Report of Independent Registered Public Accounting Firm | 3 | |
Statements of Net Assets Available for Benefits as of December 31, 2003 and 2002 | 4 | |
Statement of Changes in Net Assets Available for Benefits for the Year Ended December 31, 2003 | 5 | |
Notes to Financial Statements | 6-13 | |
SUPPLEMENTAL SCHEDULES | ||
Schedule I: Schedule H, Line 4i—Schedule of Assets (Held at End of Year) as of December 31, 2003 | 14-19 | |
Schedule II: Schedule G, Part III - Schedule of Nonexempt Transactions for the Year Ended December 31, 2003 | 20 | |
SIGNATURE | 21 | |
EXHIBIT 23—Consent of Independent Registered Public Accounting Firm | 22 |
1
The Qwest Savings & Investment Plan (the "Plan") is subject to the Employee Retirement Income Security Act of 1974, as amended, ("ERISA"). Therefore, in lieu of the requirements of Items 1-3 of Form 11-K, the financial statements and schedules of the Plan as of December 31, 2003 and 2002, and for the year ended December 31, 2003, which have been prepared in accordance with the financial reporting requirements of ERISA, are filed herewith.
2
Report of Independent Registered Public Accounting Firm
The Employee Benefits Committee
Qwest Communications International Inc.:
We have audited the accompanying statements of net assets available for benefits of the Qwest Savings & Investment Plan (the Plan) as of December 31, 2003 and 2002, and the related statement of changes in net assets available for benefits for the year ended December 31, 2003. 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 the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits 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 Plan as of December 31, 2003 and 2002, and the changes in net assets available for benefits for the year ended December 31, 2003 in conformity with U.S. generally accepted accounting principles.
Our audits were performed for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplementary schedules Schedule H, Line 4i-schedule of assets (held at end of year) as of December 31, 2003, and Schedule G, Part III-schedule of nonexempt transactions for the year ended December 31, 2003 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 and 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.
KPMG LLP
DENVER, COLORADO
June 25, 2004
3
QWEST SAVINGS & INVESTMENT PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
(Thousands of Dollars)
| December 31, | |||||||
---|---|---|---|---|---|---|---|---|
| 2003 | 2002 | ||||||
ASSETS | ||||||||
Investments (See Notes 2, 3, and 4): | ||||||||
Qwest Communications International Inc. Common Stock (Note 10) | $ | 380,159 | $ | 419,347 | ||||
AT&T Corporation Common Stock | — | 44,446 | ||||||
U S Government obligations | 214,380 | 118,240 | ||||||
Bank and insurance company contracts | 773,038 | 752,992 | ||||||
Capital Guardian International Equity Fund | 283,313 | 191,534 | ||||||
Barclays Global Investors Equity Index Fund | 814,432 | 575,357 | ||||||
Other marketable securities | 181,554 | 270,356 | ||||||
Investment in Master Trust (Note 4) | 175,415 | 81,612 | ||||||
Loans to plan participants | 81,693 | 85,400 | ||||||
Temporary investments | 45,701 | 109,642 | ||||||
Total Investments | 2,949,685 | 2,648,926 | ||||||
Receivables: | ||||||||
Employee and employer contributions | — | 4,336 | ||||||
Fund and other transfers, net | — | 852 | ||||||
Dividends and interest | 2,128 | 2,072 | ||||||
Receivables for investments sold | 446 | 22,199 | ||||||
Total Receivables | 2,574 | 29,459 | ||||||
Total Assets | 2,952,259 | 2,678,385 | ||||||
LIABILITIES | ||||||||
Expenses payable | (1,463 | ) | (2,240 | ) | ||||
Payables for securities purchased | (45,787 | ) | (69,114 | ) | ||||
Other liabilities | — | (163 | ) | |||||
Total Liabilities | (47,250 | ) | (71,517 | ) | ||||
Net Assets Available for Benefits | $ | 2,905,009 | $ | 2,606,868 | ||||
See accompanying notes to financial statements.
4
QWEST SAVINGS & INVESTMENT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
(Thousands of Dollars)
| Year Ended December 31, 2003 | ||||
---|---|---|---|---|---|
ADDITIONS | |||||
Employee contributions | $ | 168,332 | |||
Employer contributions, net of forfeitures applied | 74,654 | ||||
Rollover contributions | 20,843 | ||||
Other—net | (2,352 | ) | |||
Total additions | 261,477 | ||||
INCOME | |||||
Interest and other dividends | 55,028 | ||||
Net appreciation in fair value of investments (Notes 2 and 3) | 251,371 | ||||
Plan's share of the income, expenses, and net appreciation in fair value of investments of the Master Trust (Note 4) | 47,753 | ||||
Total income | 354,152 | ||||
Total additions and income | 615,629 | ||||
DEDUCTIONS | |||||
Plan expenses | (8,924 | ) | |||
Participant distributions | (308,564 | ) | |||
Total deductions | (317,488 | ) | |||
Net Increase | 298,141 | ||||
Net Assets Available for Benefits at beginning of year | 2,606,868 | ||||
Net Assets Available for Benefits at end of year | $ | 2,905,009 | |||
See accompanying notes to financial statements.
5
Qwest Savings & Investment Plan
NOTES TO FINANCIAL STATEMENTS
(Amounts in Thousands of Dollars)
- 1.
- Plan Description:
The following is a brief description of the Qwest Savings & Investment Plan ("QSIP" or the "Plan") and provides general information only. Participants and all others should refer to the Plan Document for a more complete description of the Plan's provisions.
General
The Plan was established during 2001 by the merger of two 401(k) plans to provide a convenient way for employees to save on a regular and long-term basis. The Plan is a defined contribution plan and covers substantially all of the employees of Qwest Communications International Inc. ("Qwest" or the "Company") and its subsidiaries.
The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974, as amended ("ERISA"). Benefits under the Plan are not guaranteed by the Pension Benefit Guaranty Corporation.
Significant Plan Amendments
Effective January 1, 2003, the Plan Year was changed to a year commencing on January 1 and ending on December 31.
Effective January 1, 2003, the Plan was amended to provide that former employees and beneficiaries may receive partial distributions of their account balances.
Effective May 1, 2003, the Plan was amended to include certain temporary employees as covered employees.
Effective June 1, 2003, the Plan was amended to mandate distributions in a single lump sum to any participant who has terminated employment and whose vested account equals five thousand dollars or less at the time of termination.
Effective August 17, 2003, the Plan was amended to allow participants to contribute up to 25% of compensation subject to Internal Revenue Code limitations.
Eligibility, Contributions, and Vesting
Management employees are eligible to enter the Plan immediately (on their hire date). Occupational employees are eligible to enter the plan after completion of three months of service with the Company. Occupational employees and management employees may designate up to 25% of their eligible compensation as contributions to the Plan. The Company provides a matching contribution in Qwest common stock or cash. Management participant contributions up to 3% of eligible compensation receive a 100% Company match beginning immediately upon their hire date. Occupational participant contributions up to 6% of eligible compensation receive an 81% Company match beginning after completion of one year of service.
Any management and occupational employee contributions in excess of 3% and 6%, respectively, of eligible compensation do not receive a Company match.
A management participant is 100% vested in Company contributions immediately upon entrance into the Plan. An occupational participant becomes 100% vested in Company contributions upon completion of three years of service with the Company. Employee contributions may either be before-tax or after-tax, or a combination of both. Before-tax employee contributions in 2003 are limited to twelve thousand dollars as provided in Section 402(g) of the Internal Revenue Code.
Effective January 1, 2003, all Company matching contributions have been designated as participant directed for financial reporting purposes because employees have the ability to direct where these contributions are invested. During 2002, all Company matching contributions were designated as non-participant directed.
A plan participant fifty years of age and older who is eligible to make contributions may defer an additional catch-up amount for any payroll period in addition to normal contributions up to the maximum catch-up amount. The maximum catch-up limit for 2003 is two thousand dollars.
6
- •
- Interest Income Fund—This fund emphasizes relatively stable, predictable income by investing in high-quality investment contracts and other fixed income investments with a diversified group of insurance companies, banks and other financial institutions.
- •
- Bond Fund—This fund is designed to offer the investor long-term preservation of capital while providing greater current income and yield by investing in a broadly diversified portfolio of fixed-income instruments of varying maturities using multiple investment managers.
- •
- Conservative Asset Allocation Fund—This fund seeks to provide current income and short-term stability of capital by investing in a diverse mix of securities with a target mix of 40% in stocks and 60% in bonds.
- •
- Moderate Asset Allocation Fund—This fund provides an investor with a more balanced approach to income preservation and long-term growth potential by investing in a diverse mix of securities with a target mix of 60% in stocks and 40% in bonds.
- •
- Aggressive Asset Allocation Fund—This fund focuses on long-term growth of capital by investing in a diverse mix of securities with a target mix of 80% in stocks and 20% in bonds.
- •
- U. S. Stock Fund—This fund seeks to provide long-term growth by mirroring both the composition and performance of the Standard & Poor's 500 Index.
- •
- U.S. Small/Mid Cap Stock Fund—This fund seeks to provide long-term growth of capital by investing in smaller and mid-sized United States companies using multiple investment managers.
- •
- The International Stock Fund—This fund seeks to provide long-term growth of capital and income by investing primarily in the stocks of companies based outside the United States.
- •
- The Qwest Shares Fund—This fund seeks to provide investment returns linked to the performance of Qwest common stock. This is an undiversified stock investment and concentrating any undiversified investment should be considered a high-risk investment.
- •
- Personal Choice Retirement Account ("PCRA")—This is a separate brokerage account made available through Charles Schwab & Company, Inc. and offers access to a wide range of investment opportunities including mutual funds and most common stocks listed on major United States exchanges.
- •
- AT&T Shares Fund—This fund invested primarily in shares of AT&T Corp. ("AT&T") common stock and AT&T Wireless common stock plus any other stock that had been issued by AT&T as a replacement for the stock held in this fund. The Plan terminated this investment option and closed the AT&T Shares Fund on June 27, 2003. Prior to June 27, 2003 participants could move their AT&T assets to any other QSIP fund option. Those participants with a balance equal to or greater than one hundred dollars in the AT&T fund could convert their interest into shares and move those shares into a PCRA account. If the participant had less than a one hundred dollar interest in the AT&T fund or chose to do nothing, their interest was liquidated and transferred into the Moderate Asset Allocation fund at the close of business on June 27, 2003.
Investment Advice
Since June 16, 2003, participants have been given access to investment advice on Plan assets through CitiStreet Advisors LLC.
Investment Options
Participants are able to invest in various funds including the following:
The assets held under these investment options are summarized in Schedule I.
Loans
Pursuant to the Plan, loans are made available to participating employees based upon a participant's vested account balance up to a maximum of $50. Except under certain provisions, the loans provide for periodic repayments over a period not to exceed five years (fifteen years for residential loans) at an interest rate as determined by the Employee Benefits Committee of the Company. Participants may also make lump-sum repayments at any time following the date of the issuance of the loan.
7
Trust and Recordkeeping Services
Bankers Trust Company, a subsidiary of Deutsche Bank ("Bankers Trust") was purchased by State Street Bank and Trust Company ("State Street") on January 31, 2003 and State Street became the Trustee for the Plan by virtue of the acquisition. Effective July 1, 2003, State Street was reaffirmed as the Trustee for the Plan. CitiStreet LLC ("CitiStreet") is the Recordkeeper for the Plan.
Tax Status
The Internal Revenue Service has determined and informed the Company by a letter dated July 20, 2001 that the Plan is qualified and that the trust established under the Plan is tax-exempt under the appropriate sections of the Internal Revenue Code (the "Code").
Since July 20, 2001, the Plan has been amended. On December 27, 2002 the Company, on behalf of the Plan, filed for a new tax determination letter, which is still pending. Since December 27, 2002 there have been additional amendments to the Plan. The Plan Administrator believes that the Plan is currently designed and being operated in compliance with the applicable requirements of the Code, the Plan is qualified, and the related trust is tax-exempt as of December 31, 2003 and 2002.
Participant Accounts
Each participant's account is credited with the participant's contributions, the Company's matching contributions and investment gains and charged for investment losses and an allocable share of Plan expenses.
Annual additions are defined as participant's contributions and the Company's matching contributions. Aggregate annual additions under the Plan and all other plans sponsored by the Company are limited to the lesser of 100% of eligible compensation, as defined, or forty thousand dollars.
Payment of Benefits
Upon retirement, termination of employment or death, each participant or beneficiary is entitled to receive amounts in accordance with the terms of the Plan. Participants may also make in-service voluntary withdrawals and hardship withdrawals if certain criteria are met. Benefit payments may be in the form of a lump sum or other benefit distributions in accordance with the options that are available, as further discussed in the Plan document.
- 2.
- Summary of Significant Accounting Policies:
Investment Valuation and Income Recognition
The values of investments are determined as follows: Qwest common stock and other securities listed on recognized United States and international stock exchanges are valued on the basis of the last published sales price on December 31, 2003 and 2002 or, if no sales were made on that date, at the last published sales price on the immediately preceding day on which sales were made.
Over-the-counter securities and government obligations are valued based on the bid prices on December 31, 2003 and 2002, from published sources where available and, if not available, from other sources considered reliable.
The Plan has entered into eleven contracts with eight banks and insurance companies which are included in the Interest Income Fund and are reported at contract value, calculated as principal plus reinvested interest, which approximates fair value. These contracts are fully-benefit responsive. (A contract is considered fully-benefit responsive if the terms of the Plan allow for withdrawals from the investment contract at contract (book) value for payment of participant initiated transactions.) In accordance with the provisions of the American Institute of Certified Public Accountants' Statement of Position 94-4, "Reporting of Investment Contracts Held by Health and Welfare Benefit Plans and Defined Contribution Pension Plans," fully benefit responsive investment contracts are reported at contract value and fair value is disclosed. Interest rates on the contracts are either fixed rates for the term of the contract or are reset quarterly or monthly based on the terms of the contract. The fair values of the contracts are estimated to be $804,844 as of December 31, 2003 and $802,298 as of December 31, 2002. This compares to contract values of $773,038 as of December 31, 2003 and $752,992 as of December 31, 2002. Investment contracts with fully-benefit responsive wrappers are reported together since the value of the wrappers is typically insignificant to the related underlying investment
8
contracts. A wrapper is a contract issued by a bank or insurance company and backed by a portfolio of high quality fixed income securities held in a trust. The contract requires the issuer to utilize book value accounting which absorbs market value fluctuations and provides participants with a stable return. At December 31, 2003 and 2002, the average crediting interest rates on these contracts were 4.46% and 5.38%, respectively. For the year ended December 31, 2003 and 2002, the average annual yield earned on these contracts was 4.98% and 5.38%, respectively.
Net realized and unrealized gains and losses are reflected in the Statement of Changes in Net Assets Available for Benefits as net appreciation in fair value of investments and are determined as the difference between fair value at the beginning of the year (or date purchased during the year) and selling price or year end fair value.
Dividend income is recorded on the ex-dividend date. Interest is accrued when earned. Purchases and sales of securities are recorded on a trade date basis.
Basis of Accounting
The accompanying financial statements have been prepared on an accrual method of accounting.
Use of Estimates
The preparation of the Plan's financial statements in conformity with accounting principles generally accepted in the United States of America ("GAAP") requires the Plan's management to make estimates and assumptions that affect the accompanying financial statements and disclosures. Actual results could differ from those estimates.
- 3.
- Investments:
The following presents investments that represent 5 percent or more of the Plan's net assets:
| December 31, 2003 | December 31, 2002 | |||||
---|---|---|---|---|---|---|---|
Barclays Global Investors Equity Index Fund, 53,023 and 48,187 shares, respectively | $ | 814,432 | $ | 575,357 | |||
Qwest Communications International Inc., 88,000 and 83,869 shares, respectively | 380,159 | 419,347 | * | ||||
Capital Guardian International Equity Fund, 29,028 shares and 26,939 shares, respectively | 283,313 | 191,534 | |||||
UBS Inc. Guaranteed Investment Contract | 159,920 | 152,930 | |||||
Monumental Life Insurance Co Guaranteed Investment Contract | 160,067 | ** | |||||
State Street Bank & Trust Guaranteed Investment Contract | 159,858 | 139,778 | |||||
Bank of America Guaranteed Investment Contracts | 139,029 | ** | |||||
J P Morgan Chase Bank Guaranteed Investment Contracts | 139,003 | ** |
- *
- Includes nonparticipant-directed assets
- **
- Investment not in excess of 5% at respective date.
For the year ended December 31, 2003, the Plan's investments (including gains and losses on investments bought and sold, as well as held during the year) appreciated (depreciated) in value as follows:
Qwest Common Stock | $ | (54,919 | ) | |
Other Marketable Securities * | 48,983 | |||
Commingled Funds ** | 257,307 | |||
$ | 251,371 | |||
- *
- Includes AT&T related securities, U S Government obligations, and other marketable securities.
- **
- Includes Capital Guardian International Equity Fund and Barclays Global Investors Equity Index Fund.
9
- 4.
- Master Trust Investment:
The Master Trust ("MT") is a trust that was established effective May 31, 2001 by Qwest Asset Management Company as named fiduciary of the Plan and the Qwest Pension Plan. The Qwest Pension Plan became a participating plan in the MT as of May 31, 2001. The Plan became a participating plan in the MT effective July 1, 2001. The MT investment is included in the U.S. Small/Mid Cap Stock Fund investment option for participants.
The Plan's interest in the assets of the MT is included in the accompanying statements of net assets available for benefits. A summary of the assets of the MT as of December 31, 2003 and 2002 is as follows:
| December 31, 2003 | December 31, 2002 | ||||||||
---|---|---|---|---|---|---|---|---|---|---|
Investments, at fair market value: | ||||||||||
Common collective trusts | $ | 107,320 | $ | 120,745 | ||||||
Corporate stock | 270,470 | 116,701 | ||||||||
Total investments | 377,790 | 237,446 | ||||||||
Interest and dividends receivable | 129 | 153 | ||||||||
Net pending security trades payable | (1,622 | ) | (296 | ) | ||||||
Administrative expenses payable | (559 | ) | (532 | ) | ||||||
Net assets of the MT | $ | 375,738 | $ | 236,771 | ||||||
The Plan's interest and the Qwest Pension Plan's interest in the net assets of the MT as of December 31, 2003 and 2002 were as follows:
| December 31 2003 | December 31 2002 | ||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|
QSIP | $ | 175,415 | 46.69 | % | $ | 81,728 | 34.52 | % | ||||
Qwest Pension Plan | 200,323 | 53.31 | 155,043 | 65.48 | ||||||||
Total | $ | 375,738 | 100.00 | % | $ | 236,771 | 100.00 | % | ||||
The investment in MT included in the accompanying statements of net assets available for benefits excludes the impact of receivables for investments sold and payables for securities purchased at each respective date.
The MT's net investment results and administrative expenses are allocated to the participating plans in proportion to each plan's relative share of the fair value of net assets of the MT at each allocation date. The amounts allocable for the year ended December 31, 2003, are as follows:
Investment income: | ||||
Net appreciation in fair value of investments | $ | 113,575 | ||
Interest and dividends | 1,724 | |||
Net investment gain | 115,299 | |||
Administrative expenses | (1,220 | ) | ||
Net income | $ | 114,079 | ||
The Plan's share of the MT's net income was $47,753 for the year ended December 31, 2003.
The net appreciation in the fair value of investments in the MT by major investment category for the year ended December 31, 2003, is as follows:
Common collective trusts | $ | 51,307 | |
Corporate stock | 62,268 | ||
Net appreciation | $ | 113,575 | |
- 5.
- Forfeitures:
When certain terminations of participation occur, the non-vested portion of a participant's account represents a forfeiture. Forfeited participant balances reduce future employer contributions or pay administrative
10
expenses of the Plan. For the year ended December 31, 2003, forfeitures of $535 were used to reduce employer contributions.
Company contributions for the year ended December 31, 2003 are shown net of forfeitures applied. Unapplied forfeitures were $74 as of December 31, 2003, and $104 as of December 31, 2002.
- 6.
- Plan Termination:
In the event that the Plan is terminated, subject to conditions set forth by ERISA, the Plan provides that the net assets be distributed to participating employees in an amount equal to their respective interests in such assets.
- 7.
- Reconciliation of Financial Statements to Form 5500:
For Form 5500 purposes, amounts allocated to withdrawing participants are recorded for benefit claims that have been processed and approved for payment prior to the respective period end, but not yet paid as of that date. However, in accordance with GAAP, benefit withdrawals are recorded when paid.
The following is a reconciliation of net assets available for benefits and benefits paid to participants per the financial statements to Form 5500:
| December 31, 2003 | December 31, 2002 | |||||
---|---|---|---|---|---|---|---|
Net assets available for benefits per the financial statements | $ | 2,905,009 | $ | 2,606,868 | |||
Less amounts allocated to withdrawing participants | (683 | ) | (632 | ) | |||
Net assets available for benefits per Form 5500 (unaudited) | $ | 2,904,326 | $ | 2,606,236 | |||
| Year Ended December 31, 2003 | |||
---|---|---|---|---|
Benefits and distributions paid to participants per the financial statements | $ | 308,564 | ||
Add amounts payable at end of period | 683 | |||
Less amounts payable at beginning of period | (632 | ) | ||
Participant distributions paid per Form 5500 (unaudited) | $ | 308,615 | ||
- 8.
- Plan Expenses:
Plan expenses are paid by the Plan, except certain expenses incurred by Qwest related to Plan administration.
- 9.
- Related-Party Transactions:
The Plan invests in certain common collective trusts managed by the Plan's various investment managers; therefore, these transactions qualify as party-in-interest transactions. In addition, the Plan has significant investments in Qwest common stock which qualify as party-in-interest transactions.
- 10.
- Concentrations, Risks and Uncertainties:
The Plan has a significant concentration of investments in Qwest common stock. The decrease in the value of the Qwest common stock held by the Plan for the year ended December 31, 2003 was $54,919.
The Plan provides for various investment options. Investment securities, in general, are exposed to various risks, such as significant world events, interest rate, credit, foreign currency, and overall market volatility risk. Due to the level of risk associated with certain investment securities, it is reasonably possible that changes in the values of investment securities will occur in the near term and that such changes could materially affect the amounts reported in the statements of net assets available for benefits.
The Plan invests in certain commingled funds. These funds may invest in derivative instruments. These instruments consist mainly of foreign currency forwards, futures contracts and options. These instruments are used mainly for hedging purposes. Credit risk exists with respect to these instruments.
Legal Matters
Since March 2002, seven putative class action suits brought under ERISA were filed in federal district court in Colorado purportedly on behalf of all participants and beneficiaries of the Plan and predecessor plans from
11
March 7, 1999 until the present. These suits also purport to seek relief on behalf of the Plan. By court order, five of these putative class actions have been consolidated and the claims made by the plaintiff in the sixth were subsequently included in the Second Amended and Consolidated Complaint, filed on May 21, 2003, and referred to as the "consolidated ERISA action". Qwest expects the seventh putative class action to be consolidated with the other cases since it asserts substantially the same claims. Although the Plan is named as a nominal defendant in this seventh case, the plaintiff actually purports to seek relief on behalf of the Plan.
An eighth case was filed in June, 2004 which, although not a putative class action, purports to seek relief on behalf of the Plan. This case contains allegations similar to those in the consolidated ERISA action, and thus Qwest also expects this case to be consolidated with that action.
Defendants in the consolidated ERISA action include Qwest, several former and current directors of Qwest, certain former officers of Qwest, Qwest Asset Management, Qwest's Plan Design Committee, the Plan Investment Committee, and the Plan Administrative Committee of the pre-merger Qwest 401(k) Savings Plan.
The consolidated ERISA action alleges, among other things, that the defendants breached fiduciary duties to the Plan participants and beneficiaries by allegedly excessively concentrating the Plan's assets invested in Qwest common stock, requiring certain participants in the Plan to hold the matching contributions received from Qwest in the Qwest Shares Fund, failing to disclose to the participants the alleged accounting improprieties that are the subject of a consolidated securities action to which Qwest is a party, failing to investigate the prudence of investing in Qwest common stock, continuing to offer Qwest common stock as an investment option under the Plan, failing to investigate the effect of the June 30, 2000 merger of U S WEST and Qwest (the "Merger") on Plan assets and then failing to vote the Plan's shares against it, preventing Plan participants from acquiring Qwest's common stock during certain periods, and, as against some of the individual defendants, capitalizing on their private knowledge of Qwest's financial condition to reap profits in stock sales. Plaintiffs seek equitable and declaratory relief, along with attorneys' fees and costs and restitution.
Plaintiffs moved for class certification on January 15, 2003, and the Company has opposed that motion, which is pending before the court. Defendants filed motions to dismiss the consolidated ERISA action on August 22, 2002. Those motions have been briefed and are currently pending before the court.
Qwest is also involved in various other legal matters that are more fully disclosed in recent publicly available filings, including a consolidated securities action alleging violation of federal securities laws. While the Company continues to defend against these matters vigorously, the consolidated ERISA action, the consolidated securities action and other legal matters relating to Qwest present significant risk to the Company, and therefore to the value of the Plan assets invested in Qwest stock. The ultimate resolution of these matters is uncertain. Thus, no assurance can be given as to the impacts the defense and resolution of these matters may have on Qwest's or the Plan's financial results or financial condition. The ultimate resolution of these matters could have a material adverse impact on Qwest's and the Plan's financial results.
DOL Examination
In April 2002, the U.S. Department of Labor commenced an examination of the Plan. It is currently not possible to predict the outcome of this examination or the impact on the Plan's net assets or changes in net assets, if any.
IRS Examination
In November of 2002, the Internal Revenue Service commenced an examination of the Plan. It is currently not possible to predict the outcome of this examination or the impact on the Plan's net assets or changes in net assets, if any.
- 11.
- Nonexempt Transactions:
The Company failed to timely remit certain employee deferral contributions withheld from participants' wages to the QSIP during a pay period in 2003 (see Schedule II).
- 12.
- Subsequent Events:
Participant Investment in Qwest Shares
Effective February 4, 2004, the August 7, 2002 suspension of participant's ability to direct investments into Qwest common stock was lifted and participants may now direct any investment into the Qwest Shares Fund.
12
Appointment of Qwest Shares Fund Fiduciary
Effective January 12, 2004, State Street was appointed as the investment manager/independent fiduciary for the Qwest Shares Fund. In connection with this appointment, Qwest Asset Management Company ("QAM") entered into an agreement with State Street whereby QAM and, to the extent permitted by law, the Plan, are obligated to indemnify State Street for losses it may incur with respect to its service as investment manager/independent fiduciary and for other related matters.
Plan Amendments
The Plan was amended effective May 14, 2004, to require the company's matching contribution to be a cash contribution. During 2003 and 2002, all Company matching contributions were in the form of Qwest common stock.
13
Qwest Savings & Investment Plan
Schedule H, Line 4i—Schedule of Assets (Held at End of Year)
As of December 31, 2003
Schedule I
Name of Issue, Borrower, Lessor or Similar Party | Description of Investment | Shares or Units | Current Values | ||||
---|---|---|---|---|---|---|---|
*QWEST COMMUNICATIONS INTL INC | Common Stock (cost of $1,765,740,361) | 87,975,340 | $ | 380,053,468 | |||
AIG SUNAMERICA GLOBAL FING X | Corporate Debt Obligation | 1,960,000 | 2,233,402 | ||||
ALBERTSONS INC | Corporate Debt Obligation | 40,000 | 43,644 | ||||
AMERICAN INTL GROUP INC | Corporate Debt Obligation | 180,000 | 170,732 | ||||
AMSOUTH BK BIRMINGHAM ALA | Corporate Debt Obligation | 300,000 | 300,989 | ||||
ANADARKO FIN CO | Corporate Debt Obligation | 200,000 | 226,726 | ||||
AOL TIME WARNER INC | Corporate Debt Obligation | 65,000 | 75,862 | ||||
ARCHER DANIELS MIDLAND CO | Corporate Debt Obligation | 85,000 | 97,685 | ||||
BANK AMER CORP | Corporate Debt Obligation | 345,000 | 344,132 | ||||
BANK OF AMERICA | Corporate Debt Obligation | 125,000 | 148,650 | ||||
BB+T CORP | Corporate Debt Obligation | 160,000 | 158,610 | ||||
BEAR STEARNS COS INC | Corporate Debt Obligation | 215,000 | 216,261 | ||||
BERKSHIRE HATHAWAY FIN CORP | Corporate Debt Obligation | 320,000 | 317,639 | ||||
BOEING CO | Corporate Debt Obligation | 150,000 | 150,696 | ||||
BOEING CO | Corporate Debt Obligation | 280,000 | 342,543 | ||||
BP CAP MKTS P L C | Corporate Debt Obligation | 325,000 | 323,198 | ||||
BRE PPTYS INC | Corporate Debt Obligation | 410,000 | 439,559 | ||||
BUNGE LTD FIN CORP | Corporate Debt Obligation | 115,000 | 115,679 | ||||
BURLINGTON NORTHN SANTA FE | Corporate Debt Obligation | 230,000 | 260,729 | ||||
CALIFORNIA INFR + ECONOMIC DEV | Corporate Debt Obligation | 250,000 | 277,623 | ||||
CAPITAL AUTO RECEIVABLES ASSET | Corporate Debt Obligation | 580,000 | 587,052 | ||||
CAPITAL AUTO RECEIVABLES ASSET | Corporate Debt Obligation | 350,000 | 353,535 | ||||
CAPITAL AUTO RECEIVABLES ASSET | Corporate Debt Obligation | 211,006 | 213,003 | ||||
CAPITAL ONE BK | Corporate Debt Obligation | 40,000 | 41,166 | ||||
CAPITAL ONE BK MEDIUM TERM SR | Corporate Debt Obligation | 160,000 | 159,306 | ||||
CIT GROUP INC | Corporate Debt Obligation | 130,000 | 134,525 | ||||
CITIBANK CR CARD ISSUANCE TR | Corporate Debt Obligation | 540,000 | 540,878 | ||||
CITIGROUP INC | Corporate Debt Obligation | 1,135,000 | 1,322,908 | ||||
CITIGROUP INC | Corporate Debt Obligation | 455,000 | 513,002 | ||||
CITIZENS COMMUNICATIONS CO | Corporate Debt Obligation | 35,000 | 40,839 | ||||
COCA COLA COMPANY (THE) | Corporate Debt Obligation | 235,000 | 255,168 | ||||
COCA COLA HBC FIN B V | Corporate Debt Obligation | 120,000 | 122,482 | ||||
COMCAST CABLE COMMUNICATIONS | Corporate Debt Obligation | 1,270,000 | 1,413,424 | ||||
COMCAST CORP | Corporate Debt Obligation | 115,000 | 125,098 | ||||
COMCAST CORP NEW | Corporate Debt Obligation | 150,000 | 149,502 | ||||
COMCAST CORP NEW | Corporate Debt Obligation | 510,000 | 530,105 | ||||
COMED TRANSITIONAL FDG TR | Corporate Debt Obligation | 454,636 | 468,069 | ||||
CORPORATE PPTY INVS | Corporate Debt Obligation | 265,000 | 301,303 | ||||
CORPORATE PPTY INVS | Corporate Debt Obligation | 370,000 | 435,965 | ||||
COX ENTERPRISES INC | Corporate Debt Obligation | 360,000 | 365,718 | ||||
CREDIT SWISS FIRST BOSTON | Corporate Debt Obligation | 215,000 | 214,744 | ||||
CRH AMER INC | Corporate Debt Obligation | 60,000 | 60,540 | ||||
DAIMLERCHRYSLER AUTO TR | Corporate Debt Obligation | 180,000 | 181,790 | ||||
DEVELOPERS DIVERSIFIED RLTY CO | Corporate Debt Obligation | 180,000 | 179,016 | ||||
DEVON FING CORP U L C | Corporate Debt Obligation | 145,000 | 173,217 | ||||
DOMINION RES INC DEL | Corporate Debt Obligation | 40,000 | 39,612 | ||||
DOW CHEM CO | Corporate Debt Obligation | 110,000 | 115,790 | ||||
DOW CHEM CO | Corporate Debt Obligation | 715,000 | 799,480 | ||||
DUKE ENERGY CO | Corporate Debt Obligation | 210,000 | 211,643 | ||||
DUKE ENERGY FIELD SVCS LLC | Corporate Debt Obligation | 155,000 | 181,591 | ||||
EOP OPER LTD PARTNERSHIP | Corporate Debt Obligation | 285,000 | 319,653 | ||||
ERP OPER LTD PARTNERSHIP | Corporate Debt Obligation | 180,000 | 190,751 | ||||
ERP OPER LTD PARTNERSHIP | Corporate Debt Obligation | 95,000 | 108,127 | ||||
EXELON GENERATION CO LLC | Corporate Debt Obligation | 100,000 | 99,592 | ||||
FIRST CHICAGO CORP | Corporate Debt Obligation | 75,000 | 83,532 | ||||
FLORIDA PWR CORP | Corporate Debt Obligation | 225,000 | 223,628 | ||||
FMR CORP | Corporate Debt Obligation | 195,000 | 234,251 | ||||
FORD MTR CO DEL | Corporate Debt Obligation | 415,000 | 381,750 | ||||
14
FORD MTR CO DEL | Corporate Debt Obligation | 515,000 | 459,444 | ||||
FORD MTR CO DEL | Corporate Debt Obligation | 1,090,000 | 1,101,468 | ||||
FORD MTR CR CO | Corporate Debt Obligation | 130,000 | 142,761 | ||||
FORD MTR CR CO | Corporate Debt Obligation | 595,000 | 664,832 | ||||
FOSTERS FIN CORP | Corporate Debt Obligation | 675,000 | 767,700 | ||||
GE GLOBAL INS HLDG CORP | Corporate Debt Obligation | 210,000 | 245,309 | ||||
GENERAL ELEC CAP CORP MTN | Corporate Debt Obligation | 1,005,000 | 1,112,657 | ||||
GENERAL ELEC CO | Corporate Debt Obligation | 925,000 | 935,485 | ||||
GENERAL MTRS ACCEP CORP | Corporate Debt Obligation | 430,000 | 487,430 | ||||
GENERAL MTRS ACCEP CORP | Corporate Debt Obligation | 65,000 | 72,993 | ||||
GENERAL MTRS ACCEP CORP | Corporate Debt Obligation | 750,000 | 850,169 | ||||
GENERAL MTRS CORP | Corporate Debt Obligation | 220,000 | 254,799 | ||||
GENERAL MTRS CORP | Corporate Debt Obligation | 90,000 | 102,187 | ||||
GOLDMAN SACHS GROUP INC | Corporate Debt Obligation | 365,000 | 383,597 | ||||
GOLDMAN SACHS GROUP INC | Corporate Debt Obligation | 340,000 | 379,960 | ||||
GTE CORP | Corporate Debt Obligation | 55,000 | 57,706 | ||||
HBOS PLC | Corporate Debt Obligation | 280,000 | 282,250 | ||||
HERTZ CORP | Corporate Debt Obligation | 170,000 | 184,162 | ||||
HIGHMARK INC | Corporate Debt Obligation | 240,000 | 260,744 | ||||
HONDA AUTO RECEIVABLES | Corporate Debt Obligation | 91,621 | 92,363 | ||||
HOUSEHOLD FIN CORP | Corporate Debt Obligation | 220,000 | 221,924 | ||||
HOUSEHOLD FIN CORP | Corporate Debt Obligation | 50,000 | 56,287 | ||||
HOUSEHOLD INTL INC | Corporate Debt Obligation | 310,000 | 348,366 | ||||
HUTCHISON WHAMPOA INTL LTD | Corporate Debt Obligation | 350,000 | 364,533 | ||||
ILLINOIS ST | Corporate Debt Obligation | 245,000 | 225,270 | ||||
ILLINOIS ST | Corporate Debt Obligation | 275,000 | 259,589 | ||||
ILLINOIS ST | Corporate Debt Obligation | 2,065,000 | 1,898,706 | ||||
INTERNATIONAL PAPER CO | Corporate Debt Obligation | 195,000 | 195,724 | ||||
ISRAEL ST | Corporate Debt Obligation | 1,000,000 | 1,011,705 | ||||
J P MORGAN CHASE + CO | Corporate Debt Obligation | 50,000 | 53,515 | ||||
JP MORGAN CHASE | Corporate Debt Obligation | 85,000 | 95,845 | ||||
KRAFT FOODS INC | Corporate Debt Obligation | 150,000 | 150,893 | ||||
LOCKHEED MARTIN CORP | Corporate Debt Obligation | 830,000 | 1,087,610 | ||||
LOCKHEED MARTIN CORP | Corporate Debt Obligation | 260,000 | 312,379 | ||||
MASSMUTUAL GLOBAL FGD II MTN | Corporate Debt Obligation | 170,000 | 162,589 | ||||
MAYTAG CORP | Corporate Debt Obligation | 135,000 | 129,786 | ||||
MERCANTILE BANKSHARES CORP | Corporate Debt Obligation | 170,000 | 165,371 | ||||
MERRILL LYNCH + CO INC | Corporate Debt Obligation | 205,000 | 206,338 | ||||
MORGAN J P + CO | Corporate Debt Obligation | 135,000 | 147,426 | ||||
NEW JERSEY ST TPK AUTH TPK REV | Corporate Debt Obligation | 180,000 | 172,037 | ||||
NEW YORK ST ELEC + GAS CORP | Corporate Debt Obligation | 260,000 | 247,372 | ||||
NEWELL RUBBERMAID INC | Corporate Debt Obligation | 80,000 | 77,405 | ||||
NEXEN INC | Corporate Debt Obligation | 110,000 | 108,456 | ||||
OREGON ST FOR ISSUES | Corporate Debt Obligation | 295,000 | 306,065 | ||||
PECO ENERGY CO | Corporate Debt Obligation | 175,000 | 174,530 | ||||
PECO ENERGY TRANS TR | Corporate Debt Obligation | 206,806 | 213,572 | ||||
PRINCIPAL LIFE GLOBAL FDG I | Corporate Debt Obligation | 265,000 | 288,637 | ||||
PROCTER + GAMBLE CO | Corporate Debt Obligation | 460,000 | 599,081 | ||||
PROCTER + GAMBLE PROFIT | Corporate Debt Obligation | 105,000 | 140,840 | ||||
PROGRESS ENERGY INC | Corporate Debt Obligation | 75,000 | 87,388 | ||||
PSE AND G TRANSITION FDG LLC | Corporate Debt Obligation | 176,572 | 182,097 | ||||
PUBLIC SVC CO COLO | Corporate Debt Obligation | 65,000 | 66,692 | ||||
PUBLIC SVC CO NEW MEXICO | Corporate Debt Obligation | 70,000 | 70,885 | ||||
RUSSELL FRANK CO | Corporate Debt Obligation | 1,000,000 | 1,090,338 | ||||
SBC COMMUNICATIONS INC | Corporate Debt Obligation | 330,000 | 361,239 | ||||
SLM CORP MTN | Corporate Debt Obligation | 540,000 | 543,709 | ||||
SLM STUDENT LN TR | Corporate Debt Obligation | 1,186,896 | 1,186,972 | ||||
SLM STUDENT LN TR | Corporate Debt Obligation | 590,000 | 590,000 | ||||
SPRINT CAP CORP | Corporate Debt Obligation | 315,000 | 372,138 | ||||
15
SPRINT CAP CORP | Corporate Debt Obligation | 280,000 | 286,031 | ||||
SPRINT CAP CORP | Corporate Debt Obligation | 495,000 | 483,037 | ||||
TIAA GLOBAL MKTS INC | Corporate Debt Obligation | 405,000 | 411,673 | ||||
TIAA GLOBAL MKTS INC | Corporate Debt Obligation | 250,000 | 257,346 | ||||
TIME WARNER ENTMT CO L P | Corporate Debt Obligation | 210,000 | 266,656 | ||||
TIME WARNER INC | Corporate Debt Obligation | 545,000 | 560,086 | ||||
TURNER BROADCASTING SYS INC | Corporate Debt Obligation | 120,000 | 146,599 | ||||
TXU AUSTRALIA HLDGS PTY LTD | Corporate Debt Obligation | 580,000 | 591,155 | ||||
U S AIR INC | Corporate Debt Obligation | 639,216 | 558,093 | ||||
UNION PAC CORP | Corporate Debt Obligation | 155,000 | 153,856 | ||||
UNITED STATES CELLULAR CORP | Corporate Debt Obligation | 345,000 | 344,892 | ||||
VERIZON GLOBAL FDG CORP | Corporate Debt Obligation | 70,000 | 78,521 | ||||
VERIZON GLOBAL FDG CORP | Corporate Debt Obligation | 500,000 | 587,355 | ||||
VERIZON NEW ENG INC | Corporate Debt Obligation | 405,000 | 446,266 | ||||
VERIZON NEW YORK INC | Corporate Debt Obligation | 170,000 | 188,106 | ||||
VIACOM INC | Corporate Debt Obligation | 190,000 | 205,170 | ||||
VIACOM INC | Corporate Debt Obligation | 1,100,000 | 1,314,723 | ||||
VIRGINIA ELEC + PWR CO | Corporate Debt Obligation | 190,000 | 202,653 | ||||
WACHOVIA CORP NEW | Corporate Debt Obligation | 110,000 | 121,183 | ||||
WAL MART STORES INC | Corporate Debt Obligation | 400,000 | 492,275 | ||||
WASTE MGMT INC DEL | Corporate Debt Obligation | 360,000 | 402,402 | ||||
WELLS FARGO BK N A | Corporate Debt Obligation | 440,000 | 494,050 | ||||
WESTVACO CORP | Corporate Debt Obligation | 80,000 | 93,793 | ||||
WISCONSIN ST GEN FD ANNUAL | Corporate Debt Obligation | 285,000 | 289,717 | ||||
WYETH | Corporate Debt Obligation | 265,000 | 268,025 | ||||
WYETH | Corporate Debt Obligation | 180,000 | 184,465 | ||||
FED HM LN PC POOL A12120 | Federal Agency Obligation | 89,557 | 88,445 | ||||
FED HM LN PC POOL A12632 | Federal Agency Obligation | 739,049 | 729,879 | ||||
FED HM LN PC POOL A15079 | Federal Agency Obligation | 399,522 | 394,565 | ||||
FED HM LN PC POOL A15638 | Federal Agency Obligation | 1,990,001 | 1,965,309 | ||||
FED HM LN PC POOL C00843 | Federal Agency Obligation | 361,603 | 378,958 | ||||
FED HM LN PC POOL C01491 | Federal Agency Obligation | 387,396 | 400,494 | ||||
FED HM LN PC POOL C01648 | Federal Agency Obligation | 479,953 | 473,997 | ||||
FED HM LN PC POOL C10875 | Federal Agency Obligation | 35,511 | 37,238 | ||||
FED HM LN PC POOL C15436 | Federal Agency Obligation | 32,473 | 34,052 | ||||
FED HM LN PC POOL C19186 | Federal Agency Obligation | 24,355 | 25,539 | ||||
FED HM LN PC POOL C49863 | Federal Agency Obligation | 109,292 | 114,476 | ||||
FED HM LN PC POOL C51976 | Federal Agency Obligation | 375,059 | 392,850 | ||||
FED HM LN PC POOL C51990 | Federal Agency Obligation | 438,625 | 459,432 | ||||
FED HM LN PC POOL C56033 | Federal Agency Obligation | 767,433 | 804,266 | ||||
FED HM LN PC POOL C60712 | Federal Agency Obligation | 30,015 | 31,439 | ||||
FED HM LN PC POOL C66154 | Federal Agency Obligation | 65,814 | 68,942 | ||||
FED HM LN PC POOL C69803 | Federal Agency Obligation | 248,757 | 260,576 | ||||
FED HM LN PC POOL C70108 | Federal Agency Obligation | 37,966 | 39,770 | ||||
FED HM LN PC POOL C74597 | Federal Agency Obligation | 197,643 | 204,326 | ||||
FED HM LN PC POOL C74905 | Federal Agency Obligation | 66,498 | 69,689 | ||||
FED HM LN PC POOL C76099 | Federal Agency Obligation | 738,099 | 763,055 | ||||
FED HM LN PC POOL C76666 | Federal Agency Obligation | 298,373 | 308,471 | ||||
FED HM LN PC POOL C78079 | Federal Agency Obligation | 429,686 | 450,068 | ||||
FED HM LN PC POOL G01443 | Federal Agency Obligation | 303,101 | 317,502 | ||||
FED HM LN PC POOL G11266 | Federal Agency Obligation | 73,836 | 78,899 | ||||
FEDERAL HOME LN BK CONS DSC NT | Federal Agency Obligation | 14,148,000 | 14,137,373 | ||||
FEDERAL HOME LN BKS | Federal Agency Obligation | 535,000 | 580,410 | ||||
FEDERAL HOME LN BKS | Federal Agency Obligation | 2,645,000 | 2,673,095 | ||||
FEDERAL HOME LN BKS | Federal Agency Obligation | 520,000 | 530,483 | ||||
FEDERAL HOME LN BKS | Federal Agency Obligation | 350,000 | 364,438 | ||||
FEDERAL HOME LN MTG CORP | Federal Agency Obligation | 111,609 | 113,224 | ||||
FEDERAL HOME LN MTG CORP | Federal Agency Obligation | 330,648 | 333,894 | ||||
FEDERAL HOME LN MTG CORP | Federal Agency Obligation | 410,000 | 412,939 | ||||
16
FEDERAL HOME LN MTG CORP | Federal Agency Obligation | 940,000 | 1,043,300 | ||||
FEDERAL HOME LN MTG CORP | Federal Agency Obligation | 123,379 | 127,608 | ||||
FEDERAL HOME LN MTG CORP MTN | Federal Agency Obligation | 410,000 | 410,192 | ||||
FEDERAL HOME LN MTG CORP MTN | Federal Agency Obligation | 2,730,000 | 2,747,682 | ||||
FEDERAL HOME LN MTG CORP MTN | Federal Agency Obligation | 635,000 | 638,519 | ||||
FEDERAL NATL MTG ASSN | Federal Agency Obligation | 1,015,000 | 1,081,142 | ||||
FEDERAL NATL MTG ASSN | Federal Agency Obligation | 440,000 | 440,135 | ||||
FEDERAL NATL MTG ASSN | Federal Agency Obligation | 370,000 | 367,394 | ||||
FEDERAL NATL MTG ASSN | Federal Agency Obligation | 610,000 | 611,037 | ||||
FEDERAL NATL MTG ASSN | Federal Agency Obligation | 1,380,000 | 1,529,727 | ||||
FEDERAL NATL MTG ASSN | Federal Agency Obligation | 445,000 | 494,073 | ||||
FEDERAL NATL MTG ASSN | Federal Agency Obligation | 1,395,000 | 1,585,956 | ||||
FEDERAL NATL MTG ASSN DISC NTS | Federal Agency Obligation | 50,700,000 | 50,654,814 | ||||
FEDERAL NATL MTG ASSN GTD | Federal Agency Obligation | 365,000 | 352,336 | ||||
FINANCING CORP | Federal Agency Obligation | 230,000 | 328,095 | ||||
FINANCING CORP CPN FICO STRIPS | Federal Agency Obligation | 1,480,000 | 940,584 | ||||
FHLMC TBA JAN 30 GOLD SINGLE | Federal Agency Obligation | 1,500,000 | 1,549,688 | ||||
FHLMC TBA JAN 30 GOLD SINGLE | Federal Agency Obligation | 2,570,000 | 2,600,519 | ||||
FHLMC TBA JAN 30 GOLD SINGLE | Federal Agency Obligation | 12,655,000 | 12,488,903 | ||||
FNMA TBA JAN 15 SINGLE FAM | Federal Agency Obligation | 2,595,000 | 2,646,090 | ||||
FNMA TBA JAN 15 SINGLE FAM | Federal Agency Obligation | 1,230,000 | 1,231,154 | ||||
FNMA TBA JAN 15 SINGLE FAM | Federal Agency Obligation | 910,000 | 954,079 | ||||
FNMA TBA JAN 15 SINGLE FAM | Federal Agency Obligation | 870,000 | 901,266 | ||||
FNMA TBA JAN 30 SINGLE FAM | Federal Agency Obligation | 14,200,000 | 14,381,930 | ||||
FNMA POOL 253394 | Federal Agency Obligation | 68,077 | 73,649 | ||||
FNMA POOL 253635 | Federal Agency Obligation | 129,995 | 139,049 | ||||
FNMA POOL 253643 | Federal Agency Obligation | 189,617 | 202,635 | ||||
FNMA POOL 253947 | Federal Agency Obligation | 79,861 | 86,213 | ||||
FNMA POOL 254261 | Federal Agency Obligation | 353,506 | 375,170 | ||||
FNMA POOL 254443 | Federal Agency Obligation | 1,936,736 | 2,033,813 | ||||
FNMA POOL 255000 | Federal Agency Obligation | 682,173 | 653,111 | ||||
FNMA POOL 357303 | Federal Agency Obligation | 56,436 | 58,545 | ||||
FNMA POOL 512673 | Federal Agency Obligation | 25,764 | 27,540 | ||||
FNMA POOL 535996 | Federal Agency Obligation | 627,981 | 671,096 | ||||
FNMA POOL 545996 | Federal Agency Obligation | 2,123,639 | 2,248,515 | ||||
FNMA POOL 555485 | Federal Agency Obligation | 714,429 | 741,129 | ||||
FNMA POOL 555515 | Federal Agency Obligation | 50,861 | 53,965 | ||||
FNMA POOL 555851 | Federal Agency Obligation | 3,494,221 | 3,654,736 | ||||
FNMA POOL 588104 | Federal Agency Obligation | 20,892 | 21,937 | ||||
FNMA POOL 625285 | Federal Agency Obligation | 785,112 | 831,358 | ||||
FNMA POOL 634503 | Federal Agency Obligation | 170,664 | 181,123 | ||||
FNMA POOL 644693 | Federal Agency Obligation | 499,469 | 528,839 | ||||
FNMA POOL 655114 | Federal Agency Obligation | 94,141 | 100,601 | ||||
FNMA POOL 704084 | Federal Agency Obligation | 325,423 | 337,615 | ||||
FNMA POOL 723352 | Federal Agency Obligation | 468,443 | 474,781 | ||||
FNMA POOL 723960 | Federal Agency Obligation | 138,594 | 140,469 | ||||
FNMA POOL 726786 | Federal Agency Obligation | 997,899 | 1,011,400 | ||||
FNMA POOL 731265 | Federal Agency Obligation | 572,600 | 548,206 | ||||
FNMA POOL 731375 | Federal Agency Obligation | 143,469 | 145,410 | ||||
FNMA POOL 737999 | Federal Agency Obligation | 713,522 | 723,176 | ||||
FNMA POOL 747519 | Federal Agency Obligation | 499,329 | 478,057 | ||||
FNMA POOL 749040 | Federal Agency Obligation | 2,692,328 | 2,577,632 | ||||
FNMA TBA JAN 30 SINGLE FAM | Federal Agency Obligation | 3,510,000 | 3,627,367 | ||||
FNMA TBA SINGLE FAMILY JAN 15 | Federal Agency Obligation | 1,615,000 | 1,573,616 | ||||
GNMA I TBA JAN 30 SINGLE FAM | Federal Agency Obligation | 355,000 | 386,173 | ||||
GNMA I TBA JAN 30 SINGLE FAM | Federal Agency Obligation | 520,000 | 528,612 | ||||
GNMA I TBA JAN 30 SINGLE FAM | Federal Agency Obligation | 935,000 | 971,523 | ||||
GNMA I TBA JAN 30 SINGLE FAM | Federal Agency Obligation | 1,040,000 | 1,095,900 | ||||
GNMA II POOL 003151 | Federal Agency Obligation | 458,783 | 487,666 | ||||
17
GNMA II POOL 003229 | Federal Agency Obligation | 236,541 | 251,340 | ||||
GNMA II POOL 003240 | Federal Agency Obligation | 234,154 | 248,803 | ||||
GNMA II TBA JAN 30 JUMBOS | Federal Agency Obligation | 480,000 | 497,925 | ||||
GNMA POOL 510285 | Federal Agency Obligation | 459,185 | 489,713 | ||||
GNMA POOL 592128 | Federal Agency Obligation | 55,529 | 59,177 | ||||
GNMA POOL 596775 | Federal Agency Obligation | 98,845 | 105,338 | ||||
GNMA POOL 596796 | Federal Agency Obligation | 99,546 | 106,086 | ||||
GNMA POOL 600121 | Federal Agency Obligation | 53,224 | 56,115 | ||||
GNMA POOL 603835 | Federal Agency Obligation | 175,834 | 185,381 | ||||
BURLINGTON RES FIN CO | Foreign Corporate Debt Obligation | 750,000 | 887,859 | ||||
DEUTSCHE TELEKOM INTL FIN BV | Foreign Corporate Debt Obligation | 330,000 | 421,551 | ||||
FRANCE TELECOM SA | Foreign Corporate Debt Obligation | 395,000 | 474,427 | ||||
FRANCE TELECOM SA | Foreign Corporate Debt Obligation | 80,000 | 106,294 | ||||
PEMEX PROJ FDG MASTER TR | Foreign Corporate Debt Obligation | 65,000 | 71,988 | ||||
PETRONAS CAP LTD | Foreign Corporate Debt Obligation | 155,000 | 183,668 | ||||
TELEFONOS DE MEXICO S A | Foreign Corporate Debt Obligation | 440,000 | 440,669 | ||||
VODAFONE AIRTOUCH PLC | Foreign Corporate Debt Obligation | 1,750,000 | 2,074,091 | ||||
BRITISH COLUMBIA PROV CDA | Foreign Government Obligation | 575,000 | 606,146 | ||||
NEW BRUNSWICK PROV CDA | Foreign Government Obligation | 320,000 | 325,531 | ||||
ONTARIO PROV CDA | Foreign Government Obligation | 485,000 | 483,063 | ||||
QUEBEC PROV CDA MTN | Foreign Government Obligation | 150,000 | 201,926 | ||||
UNITED MEXICAN STS MTN | Foreign Government Obligation | 735,000 | 804,090 | ||||
BANK OF AMERICA | Guaranteed Investment Contract | 46,327,229 | 46,327,229 | ||||
BANK OF AMERICA | Guaranteed Investment Contract | 92,702,258 | 92,702,258 | ||||
GE LIFE AND ANNUITY ASSURANCE | Guaranteed Investment Contract | 4,074,586 | 4,074,586 | ||||
JACKSON NATIONAL LIFE | Guaranteed Investment Contract | 7,024,795 | 7,024,795 | ||||
JPMORGAN CHASE BANK | Guaranteed Investment Contract | 92,655,227 | 92,655,227 | ||||
JPMORGAN CHASE BANK | Guaranteed Investment Contract | 46,348,094 | 46,348,094 | ||||
MONUMENTAL LIFE | Guaranteed Investment Contract | 160,067,299 | 160,067,299 | ||||
*STATE STREET BANK + TRUST | Guaranteed Investment Contract | 159,858,201 | 159,858,201 | ||||
TRAVELERS INS CO | Guaranteed Investment Contract | 4,060,727 | 4,060,727 | ||||
UBS AG | Guaranteed Investment Contract | 159,919,728 | 159,919,728 | ||||
*PARTICIPANTS LOANS | Loans with interest rates ranging from 5.00% to 11.5% | 81,693,116 | 81,693,116 | ||||
*BGI EQUITY INDEX FD F | Pooled Common Stock | 53,022,910 | 814,431,899 | ||||
*CAP GUARDIAN INTL EQUITY FD | Pooled Common Stock | 29,027,950 | 283,312,790 | ||||
*STATE STREET BANK + TRUST CO | Pooled Temporary Investment (cost of $45,667,619) | 45,667,619 | 45,667,619 | ||||
UNITED STATES TREAS BDS | U S Treasury Obligation | 1,785,000 | 2,574,095 | ||||
UNITED STATES TREAS BDS | U S Treasury Obligation | 215,000 | 308,601 | ||||
UNITED STATES TREAS BDS | U S Treasury Obligation | 545,000 | 568,354 | ||||
UNITED STATES TREAS BDS | U S Treasury Obligation | 1,740,000 | 2,007,932 | ||||
UNITED STATES TREAS BDS | U S Treasury Obligation | 1,500,000 | 2,026,172 | ||||
UNITED STATES TREAS BDS | U S Treasury Obligation | 6,220,000 | 7,454,527 | ||||
UNITED STATES TREAS NTS | U S Treasury Obligation | 2,400,000 | 2,718,468 | ||||
UNITED STATES TREAS NTS | U S Treasury Obligation | 205,000 | 204,776 | ||||
UNITED STATES TREAS NTS | U S Treasury Obligation | 950,000 | 956,457 | ||||
UNITED STATES TREAS NTS | U S Treasury Obligation | 2,930,000 | 2,935,494 | ||||
UNITED STATES TREAS NTS | U S Treasury Obligation | 2,700,000 | 2,721,411 | ||||
UNITED STATES TREAS NTS | U S Treasury Obligation | 245,000 | 247,163 | ||||
UNITED STATES TREAS NTS | U S Treasury Obligation | 1,355,000 | 1,367,386 | ||||
UNITED STATES TREAS NTS | U S Treasury Obligation | 305,000 | 327,553 | ||||
UNITED STATES TREAS BDS | U S Treasury Obligation | 4,650,000 | 4,683,606 | ||||
UNITED STATES TREAS BDS | U S Treasury Obligation | 1,870,000 | 1,950,133 | ||||
UNITED STATES TREAS BDS | U S Treasury Obligation | 555,000 | 888,304 | ||||
UNITED STATES TREAS BDS | U S Treasury Obligation | 13,010,000 | 13,124,852 | ||||
UNITED STATES TREAS NTS | U S Treasury Obligation | 7,130,000 | 7,898,143 | ||||
UNITED STATES TRES SC STRP INT | U S Treasury Obligation | 2,885,000 | 886,148 | ||||
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Self-Directed Personal Choice Retirement Account: | |||||||
*QWEST COMMUNICATIONS INTL INC | Common Stock | 105,601 | |||||
GOVERNMENT SECURITIES | U. S. Government Obligations | 595,486 | |||||
OTHER MARKETABLE SECURITIES | Various | 124,117,500 | |||||
*STATE STREET BANK and TRUST CO | Pooled Temporary Investment | 32,990 | |||||
Total Investments not including the Plan's Investment in the Master Trust | $ | 2,774,269,879 | |||||
- *
- Represents a party-in-interest
See accompanying report of independent registered public accounting firm.
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Qwest Savings & Investment Plan
Schedule G, Part III—Schedule of Nonexempt Transactions
For the Year Ended December 31, 2003
Schedule II
Identity of Party Involved | Relationship to Plan, Employer Or Other Party-In-Interest | Description of Transactions | Transaction Amount | |||||
---|---|---|---|---|---|---|---|---|
*Qwest Communications International Inc. | Plan Sponsor | Employee contributions not timely remitted to the Plan for pay period end date of December 19, 2003. Corrected and remitted on February 25, 2004 | $ | 20,383 | (a ) |
- (a)
- Interest has been calculated at the QSIP rate of return for the period of time the employer had control of the funds and is not included in the transaction amount. Total interest due the participants is thirty-eight dollars.
- *
- Represents a party-in-interest.
See accompanying report of independent registered public accounting firm.
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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 hereunto duly authorized.
Qwest Savings & Investment Plan
June 28, 2004 Date | /s/ OREN G. SHAFFER Oren G. Shaffer Authorized Representative |
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TABLE OF CONTENTS
REQUIRED INFORMATION
Report of Independent Registered Public Accounting Firm
QWEST SAVINGS & INVESTMENT PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS (Thousands of Dollars)
QWEST SAVINGS & INVESTMENT PLAN STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS (Thousands of Dollars)
Qwest Savings & Investment Plan NOTES TO FINANCIAL STATEMENTS (Amounts in Thousands of Dollars)
Qwest Savings & Investment Plan Schedule H, Line 4i—Schedule of Assets (Held at End of Year) As of December 31, 2003 Schedule I
Qwest Savings & Investment Plan Schedule G, Part III—Schedule of Nonexempt Transactions For the Year Ended December 31, 2003 Schedule II
SIGNATURE