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, 2015
OR
¨ | TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
Commission file number 0-16350
A. | Full title of the plan and address of the plan, if different from that of the issuer named below: |
Ogilvy & Mather Savings and Investment Plan
B. | Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: |
WPP plc
27 Farm Street
London, United Kingdom, W1J5RJ
OGILVY & MATHER SAVINGS AND INVESTMENT PLAN
INDEX TO FINANCIAL STATEMENTS
| | | | |
| | Page | |
| |
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM | | | 1 | |
| |
FINANCIAL STATEMENTS: | | | | |
Statements of Net Assets Available for Benefits December 31, 2015 and 2014 | | | 2 | |
| |
Statement of Changes in Net Assets Available for Benefits For the Year Ended December 31, 2015 | | | 3 | |
| |
Notes to Financial Statements | | | 4-12 | |
| |
SUPPLEMENTAL SCHEDULES: * | | | | |
| |
Form 5500, Schedule H, Part IV, line 4i - Schedule of Assets (Held at End of Year) - December 31, 2015 | | | 13 | |
| |
Form 5500, Schedule H, Part IV, line 4a - Schedule of Delinquent Participant Contributions For the Year Ended December 31, 2015 | | | 14 | |
* | All other schedules required by Section 2520.103-10 of the Department of Labor’s Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974 have been omitted because they are not applicable. |
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Participants and Plan Administrator of the
Ogilvy & Mather Savings and Investment Plan
We have audited the accompanying statements of net assets available for benefits of the Ogilvy & Mather Savings and Investment Plan (the “Plan”) as of December 31, 2015 and 2014, and the related statement of changes in net assets available for benefits for the year ended December 31, 2015. 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 audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for benefits of the Plan as of December 31, 2015 and 2014, and the changes in net assets available for benefits for the year ended December 31, 2015, in conformity with accounting principles generally accepted in the United States of America.
The supplemental information in the accompanying schedules of Form 5500, Schedule H, Part IV, line 4i - Schedule of Assets (Held at End of Year) - December 31, 2015 and Form 5500, Schedule H, Part IV, line 4a - Schedule of Delinquent Participant Contributions For the Year Ended December 31, 2015, have been subjected to audit procedures performed in conjunction with the audit of the Plan’s financial statements. The supplemental information is presented for the purpose of additional analysis and is not a required part of the financial statements, but includes supplemental 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 information is the responsibility of the Plan’s management. Our audit procedures included determining whether the supplemental information reconciles to the financial statements or the underlying accounting and other records, as applicable, and performing procedures to test the completeness and accuracy of the information presented in the supplemental information. In forming our opinion on the supplemental information in the accompanying schedules, we evaluated whether the supplemental information, including its form and content, is presented in conformity with the Department of Labor’s Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. In our opinion, the supplemental information in the accompanying schedules is fairly stated in all material respects in relation to the financial statements as a whole.
/S/ BENCIVENGA WARD & COMPANY, CPA’S, P.C.
Valhalla, New York
June 28, 2016
1
OGILVY & MATHER SAVINGS AND INVESTMENT PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 2015 AND 2014
| | | | | | | | |
| | 2015 | | | 2014 | |
ASSETS | | | | | | | | |
Investments, at fair value | | $ | 249,073,615 | | | $ | 251,610,752 | |
| | | | | | | | |
| | |
Receivables: | | | | | | | | |
Employer contributions | | | 97,879 | | | | 20,298 | |
Participant contributions | | | 514,461 | | | | 508,440 | |
Notes receivable from participants | | | 3,154,279 | | | | 2,613,223 | |
| | | | | | | | |
Total receivables | | | 3,766,619 | | | | 3,141,961 | |
| | | | | | | | |
| | |
NET ASSETS AVAILABLE FOR BENEFITS | | $ | 252,840,234 | | | $ | 254,752,713 | |
| | | | | | | | |
See accompanying notes to the financial statements.
2
OGILVY & MATHER SAVINGS AND INVESTMENT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 2015
| | | | |
ADDITIONS: | | | | |
| |
Net investment income: | | | | |
Interest and dividend income | | $ | 12,473,088 | |
Net depreciation in fair value of investments | | | (10,486,988 | ) |
| | | | |
Net investment income | | | 1,986,100 | |
| | | | |
| |
Interest income on notes receivable from participants | | | 105,446 | |
| | | | |
| |
Contributions: | | | | |
Employer contributions | | | 1,542,156 | |
Participant contributions | | | 16,761,156 | |
Rollover contributions | | | 1,793,390 | |
| | | | |
Total contributions | | | 20,096,702 | |
| | | | |
Total additions | | | 22,188,248 | |
| | | | |
| |
DEDUCTIONS: | | | | |
| |
Benefits paid to participants | | | 24,022,237 | |
Administrative expenses | | | 78,490 | |
| | | | |
Total deductions | | | 24,100,727 | |
| | | | |
| |
DECREASE IN NET ASSETS | | | (1,912,479 | ) |
| |
NET ASSETS AVAILABLE FOR BENEFITS: | | | | |
Beginning of year | | | 254,752,713 | |
| | | | |
| |
End of year | | $ | 252,840,234 | |
| | | | |
See accompanying notes to the financial statements.
3
OGILVY & MATHER SAVINGS AND INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2015 AND 2014, AND FOR THE YEAR ENDED DECEMBER 31, 2015
1. | DESCRIPTION OF THE PLAN |
The following description of the Ogilvy & Mather Savings and Investment Plan (the “Plan”), as amended and restated effective January 1, 2011, is provided for general information purposes only. Participants should refer to the Plan document for a more complete description of the Plan’s provisions. Effective July 1, 2014, the Plan name was changed from the Ogilvy & Mather Profit Sharing Retirement and 401(k) Plan to the Ogilvy & Mather Savings and Investment Plan.
General
The Plan is a defined contribution plan sponsored by The Ogilvy Group, LLC (the “Company”), a wholly-owned subsidiary of WPP plc. The Plan covers all full-time, part-time and eligible temporary employees of The Ogilvy Group, LLC, A. Eicoff & Company, Inc., Ogilvy Public Relations Worldwide Inc., Soho Square Public Relations, Inc., Feinstein Kean Healthcare, Soho Square, LLC, Ogilvy Action, LLC, and Effective UI, Inc. (collectively the “Companies”).
Mercer HR Services, LLC, is the Recordkeeper and Trustee of the Plan. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 (“ERISA”).
The Plan is administered by the Retirement Plan Committee (“Committee”), which was established by the Board of Directors of the Company.
Contributions/Eligibility
Deferred Contributions
Participants may elect to make 401(k) contributions in an amount from 1% to 50% of their eligible compensation in any calendar year. These contributions constitute salary reductions and are subject to tax deferral under the Internal Revenue Code (“IRC”). In addition, participants may make Roth elective deferrals to their account. Participants direct the investment of their contributions into various investment options offered by the Plan.
Eligible employees hired on or after April 1, 2013 are automatically enrolled in the Plan at a deferral rate of 4% of their eligible compensation, unless the employee elects prior to his or her date of Plan participation either not to defer compensation or to defer a larger or smaller percentage of compensation. Such election must be made in writing, or via telephone or internet access to the Company’s Benefits Department. An employee who is automatically enrolled in the Plan on or after July 1, 2014, and who has not opted out of contributing by their one year anniversary of their auto-enrollment date, will have his or her salary reduction contribution percentage escalated once, by 1%.
For Plan years 2015 and 2014, eligible compensation is limited to $265,000 and $260,000, respectively. The maximum 401(k) contribution as established by the Internal Revenue Service (“IRS”) for the year ended December 31, 2015 was $18,000.
Catch-up Contributions
In addition, participants who have attained the age of 50 before the close of the Plan year, may make catch-up contributions in accordance with the IRC. The maximum amount of catch-up contributions for the year ended December 31, 2015 was $6,000.
4
OGILVY & MATHER SAVINGS AND INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2015 AND 2014, AND FOR THE YEAR ENDED DECEMBER 31, 2015
1. | DESCRIPTION OF THE PLAN - (continued) |
All employees are eligible to participate in the Plan, except employees who are: (a) covered by collective bargaining agreements, unless otherwise stipulated in such collective bargaining agreements, (b) non-resident aliens, (c) leased employees or independent contractors and, (d) experiential field employees. Effective July 1, 2014, employees who are determined to be temporary, part-time or contingent employees are eligible to participate on the first day of the month coinciding with, or next following, the completion of one year of service, as defined in the Plan. All other employees are eligible to participate on the first day of the month coinciding with, or next, following the ninety day anniversary of the employment commencement date, as defined.
Employer Contributions
Effective July 1, 2014, eligible employees of the Companies (other than Effective UI, Inc.) who are hired on or after July 1, 2014, or employees who are rehired or transferred to a company on or after July 1, 2014 and who are not eligible to accrue a benefit under the Ogilvy & Mather Account Balance Defined Benefit Pension Plan, are entitled to an employer matching contribution and an annual true-up matching contribution. The matching contribution shall be equal to the first 5% of the participant’s compensation that is deferred into the Plan for each payroll period. The annual true-up employer matching contribution will be credited to those participants who did not receive an employer matching contribution in the amount of 100% of the first 5% of compensation contributed during the Plan year. Catch-up contributions are not eligible for matching contributions. Employer contributions to the Plan for those eligible employees hired prior to July 1, 2014 are made at the discretion of the management of the Companies.
Participant Accounts
Each participant’s account is credited with the participant’s contribution, the allocation of employer contributions and Plan earnings, and charged with withdrawals and an allocation of Plan losses and administrative expenses. The benefit to which a participant is entitled is the benefit that can be provided from the participant’s vested account balance.
Investments
Participants direct the investment of their account balances from among various investment options offered by the Plan. The Plan offers a number of mutual funds, a common collective trust fund and the WPP Stock Fund, which invests in American Depositary Shares of WPP plc (“WPP plc ADSs”).
Forfeited Accounts
At December 31, 2015 and 2014, forfeited non-vested accounts totaled $172,028 and $130,716, respectively. These amounts can be used to reduce future employer contributions or pay administrative expenses under the Plan. During 2015, no forfeiture amounts were used for these purposes.
5
OGILVY & MATHER SAVINGS AND INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2015 AND 2014, AND FOR THE YEAR ENDED DECEMBER 31, 2015
1. | DESCRIPTION OF THE PLAN - (continued) |
Vesting
Prior to July 1, 2014, all participants, other than those transferred from the OPR 401(k) Plan (“OPR Participants”), are fully vested in their accounts at all times. Elective employee 401(k) contributions and earnings thereon are always fully vested. Participants are also fully vested in their Roth elective deferrals.
OPR Participants, whose accounts include prior employer contributions that were transferred into the Plan, vest in those contributions as follows:
| | | | |
Years of Vesting Service | | Vested Percentage | |
1 but less than 2 | | | 0 | |
2 but less than 3 | | | 20 | % |
3 but less than 4 | | | 40 | % |
4 but less than 5 | | | 60 | % |
5 or more | | | 100 | % |
On or after 65th birthday, disabled or death | | | 100 | % |
Participants hired after July 1, 2014 are vested in their employer matching contributions subject to a 3-year cliff vesting schedule.
Notes Receivable from Participants
Eligible employees can request a Plan loan. Only two personal loans and one residential loan can be outstanding at any time. Participants may borrow from their fund accounts a minimum of $1,000 up to a maximum equal to the lesser of $50,000 or 50% of their vested account balance. The notes are secured by the balance in the participant’s account and bear interest at rates commensurate with local prevailing rates as determined quarterly by the Committee. Loan repayment terms are generally five and fifteen years for personal and residential loans, respectively. Principal and interest are paid ratably through payroll deductions.
Upon termination of employment, a participant can: (a) pay-off the entire outstanding loan balance, (b) transfer the loan to a successor employer qualified retirement plan as part of an eligible rollover distribution, or (c) elect to continue repayment in a form or manner determined by the Committee, subject to the provisions of the Plan. An eligible employee, who takes an approved unpaid leave of absence, as defined in the Plan, may discontinue payments on the loan for a period of absence up to 12 months. Upon a return to employment, the eligible employee must repay the missed payments within the original loan term. At December 31, 2015, interest rates ranged from 3.50% to 9.25% for outstanding loans.
6
OGILVY & MATHER SAVINGS AND INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2015 AND 2014, AND FOR THE YEAR ENDED DECEMBER 31, 2015
1. | DESCRIPTION OF THE PLAN - (continued) |
Payment of Benefits
Plan participants or beneficiaries, including domestic partners, are eligible to receive a benefit payment equal to their vested account balance upon termination of employment, retirement, or death, as stipulated in the Plan document. Benefits are paid in a single lump-sum payment, subject to certain restrictions as defined in the Plan. All distributions under the Plan are made in cash, except to the extent that the participant has an investment in the WPP Stock Fund and elects to have such portion of the participant’s account distributed in WPP plc ADSs held in the WPP Stock Fund. The Plan was amended in 2004 to allow for in-service age 59 1⁄2 withdrawals and in-service rollover withdrawals.
The Committee may permit an eligible employee, as defined in the Plan, to withdraw all or a portion of a participant’s account balance upon the next valuation date upon hardship subject to certain provisions in the Plan. Hardships are defined in the Plan document as certain medical expenses, purchase of a primary residence, payment of certain tuition and education fees, and to prevent eviction from a participant’s primary residence. Hardships also include certain payments for burial and funeral expenses and damages to a principal residence, as defined by the IRC. A participant receiving a hardship withdrawal may not make employee contributions to any plans maintained by the Company or any affiliate for a period of six months.
2. | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
Basis of Accounting
The financial statements of the Plan are prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America (“GAAP”).
Investments held by a defined contribution plan are required to be reported at fair value, except for fully benefit-responsive investment contracts. Contract value is the relevant measure for that portion of the net assets available for benefits of a defined contribution plan attributable to fully benefit-responsive investment contracts because contract value is the amount participants normally would receive if they were to initiate permitted transactions under the terms of the Plan.
Investment Valuation and Income Recognition
The Plan’s investments are reported at fair value. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.
Purchases and sales of securities are recorded on a trade-date basis. Interest income is recorded on the accrual basis. Dividends are recorded on the ex-dividend date. Net appreciation/depreciation includes the Plan’s gains and losses on investments bought and sold as well as held during the year.
Use of Estimates
The preparation of financial statements in conformity with GAAP requires Plan management to make estimates and assumptions that affect the reported amounts of assets and liabilities and changes therein, and disclosure of contingent assets and liabilities. Actual results could differ from those estimates.
7
OGILVY & MATHER SAVINGS AND INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2015 AND 2014, AND FOR THE YEAR ENDED DECEMBER 31, 2015
2. | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - (continued) |
Recent Accounting Pronouncements
In May 2015, the Financial Accounting Standards Board (“FASB”) issued ASU 2015-07, Fair Value Measurement (Topic 820): Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or its Equivalent), which removes the requirement to present certain investments, such as common collective trusts, which use the net asset value (“NAV”) per share using the practical expedient in ASC 820, Fair Value Measurement, from categorization within the fair value hierarchy. The guidance requires retrospective application and is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015. As permitted by ASU 2015-07, Management elected to early adopt the provisions of this new standard and has presented the investment disclosures required for both years at December 31, 2015 and 2014, so that the investments at fair value in the tables in Note 3 reconcile to investments at fair value as presented on the Statements of Net Assets Available for Benefits.
In July 2015, the FASB issued ASU 2015-12, Plan Accounting: Defined Benefit Pension Plans (Topic 960), Defined Contribution Pension Plans (Topic 962), and Health and Welfare Benefit Plans (Topic 965): Part (I) Fully Benefit-Responsive Investment Contracts, Part (II) Plan Investment Disclosures, Part (III) Measurement Date Practical Expedient. This three-part standard simplifies employee benefit plan reporting with respect to fully benefit-responsive investment contracts and provides for a measurement date practical expedient. Part I eliminates the requirement to measure and disclose the fair value of fully benefit-responsive investment contracts. Part II eliminates the requirement to disclose individual investments, which comprise 5% or more of total net assets available for benefits, as well as the net appreciation/depreciation for investments by general type. Part II requires plans to disaggregate investments that are measured using fair value only by general type. Part III is not applicable to this Plan. Parts I and II are effective for fiscal years beginning after December 15, 2015 and should be applied retrospectively, with early adoption permitted. Management has elected to early adopt Parts I and II. Accordingly, the amendments were retrospectively applied resulting in the reclassification of $554,140 representing the adjustment from fair value to contract value for the common collective trust included on the Statement of Net Assets Available for Benefits as of December 31, 2014. In addition, the Plan eliminated the disclosure of investments comprising more than 5% of net assets available for benefits at December 31, 2014.
Notes Receivable from Participants
Notes receivable from participants are measured at their unpaid principal balance plus any accrued but unpaid interest. Interest income is recorded on the accrual basis. Related fees are charged directly to the borrowing participant’s account and are included in administrative expenses when incurred. No allowance for credit losses has been recorded as of December 31, 2015 and 2014. If a participant does not make note repayments and the Plan Administrator considers the participant note to be in default, the note balance is reduced, and the delinquent participant note receivable is recorded as a benefit payment based on the terms of the Plan document.
Excess Contributions Payable
Amounts payable to participants for contributions in excess of amounts allowed by the IRS, are recorded as a liability, with a corresponding reduction to contributions. There were no excess contributions for the years ended December 31, 2015 or 2014.
8
OGILVY & MATHER SAVINGS AND INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2015 AND 2014, AND FOR THE YEAR ENDED DECEMBER 31, 2015
2. | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - (continued) |
Payment of Benefits
Benefits are recorded when paid.
Administrative Expenses
Certain expenses of maintaining the Plan are paid by the Plan, unless otherwise paid by the Company. Expenses that are paid by the Company are excluded from these financial statements. Fees related to the administration of notes receivable from participants are charged directly to the participant’s account and are included in administrative expenses. Investment related expenses are included in net appreciation/depreciation of fair value of investments.
Subsequent Events
The Plan’s management has evaluated subsequent events through June 28, 2016, the date the financial statements were available to be issued, and no additional disclosures were required.
3. | FAIR VALUE MEASUREMENTS |
The framework for measuring fair value provides a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy under the FASB Accounting Standards Codification (ASC) 820 are described as follows: Level 1 inputs consist of unadjusted quoted prices for identical assets or liabilities in active markets that the Plan has the ability to access; Level 2 inputs include quoted prices for similar assets or liabilities in active markets, quoted prices in markets that are not active, inputs other than quoted prices that are observable for the asset or liability, or other inputs that are derived principally from, or corroborated by, observable market data by correlation or other means. If the asset or liability has a specified (contractual) term, the Level 2 input must be observable for substantially the full term of the asset or liability. Level 3 inputs are unobservable and significant to the fair value measurement.
The asset or liability’s fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Valuation techniques maximize the use of relevant observable inputs and minimize the use of unobservable inputs.
The following is a description of the valuation methodologies used for assets measured at fair value.
Mutual Funds
The mutual funds are valued at the daily closing price as reported by the fund. Mutual funds held by the Plan are open-end mutual funds that are registered with the Securities and Exchange Commission. These funds are required to publish their daily NAV’s and to transact at that price. The mutual funds held by the Plan are deemed to be actively traded.
WPP Stock Fund
The fair value of the WPP Stock Fund is based on quoted NAV’s of the shares held by the Plan at year-end.
9
OGILVY & MATHER SAVINGS AND INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2015 AND 2014, AND FOR THE YEAR ENDED DECEMBER 31, 2015
3. | FAIR VALUE MEASUREMENTS - (continued) |
The Putnam Stable Value Fund
The Putnam Stable Value Fund (“PSVF”), a common collective trust, invests directly or indirectly in fully benefit–responsive investment contracts. The PSVF is valued at the NAV as provided by the trustee, which is used as a practical expedient to estimate fair value. This practical expedient would not be used if it is determined to be probable that the fund will sell the investment for an amount different from the reported NAV. Participant transactions (purchases and sales) may occur daily. Were the Plan to initiate a full redemption of the PSVF, the issuer reserves the right to temporarily delay withdrawal from the PSVF in order to ensure that securities liquidations will be carried out in an orderly business manner. The PSVF, included in the fair value hierarchy table below, files a U.S. Department of Labor Form 5500, Annual Return/Report of Employee Benefit Plan, as a direct filing entity. Accordingly, certain disclosure requirements under ASU 2015-12 with respect to investment strategies for investments measured using the net asset value practical expedient are not required in this report.
The following tables set forth by level, within the fair value hierarchy, the Plan’s investments at fair value as of December 31, 2015 and 2014.
| | | | | | | | | | | | | | | | |
| | Investments at Fair Value as of December 31, | |
| | 2015 | | | 2014 | |
| | Level 1 | | | Total | | | Level 1 | | | Total | |
| | | | |
Mutual funds | | $ | 210,922,658 | | | $ | 210,922,658 | | | $ | 213,503,505 | | | $ | 213,503,505 | |
Cash | | | 5,799 | | | | 5,799 | | | | 6,825 | | | | 6,825 | |
WPP Stock Fund | | | 9,429,073 | | | | 9,429,073 | | | | 8,671,926 | | | | 8,671,926 | |
| | | | | | | | | | | | | | | | |
Total investments in the fair value hierarchy | | | 220,357,530 | | | | 220,357,530 | | | | 222,182,256 | | | | 222,182,256 | |
| | | | |
Investment in the Putnam Stable Value Fund | | | — | | | | 28,716,085 | | | | — | | | | 29,428,496 | |
| | | | | | | | | | | | | | | | |
Investments at fair value | | $ | 220,357,530 | | | $ | 249,073,615 | | | $ | 222,182,256 | | | $ | 251,610,752 | |
| | | | | | | | | | | | | | | | |
Gains and losses included in changes in net assets available for benefits for the years ended December 31, 2015 and 2014, are reported in net depreciation/appreciation in fair value of investments.
10
OGILVY & MATHER SAVINGS AND INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2015 AND 2014, AND FOR THE YEAR ENDED DECEMBER 31, 2015
3. | FAIR VALUE MEASUREMENTS - (continued) |
Investments Measured at Fair Value Using the Practical Expedient
The following table summarizes investments for which fair value is measured using the NAV per share practical expedient for the PSVF as of December 31, 2015, and 2014, respectively. There are no participant redemption restrictions for these investments; the redemption notice period is applicable only to the Plan.
| | | | | | | | |
As of December 31, 2015 | | | | |
Fair Value | | | Unfunded Commitments | | Redemption Frequency (If Currently Eligible) | | Redemption Notice Period |
$ | 28,716,085 | | | Not applicable | | Daily | | 60 days |
| | |
As of December 31, 2014 | | | | |
Fair Value | | | Unfunded Commitments | | Redemption Frequency (If Currently Eligible) | | Redemption Notice Period |
$ | 29,428,496 | | | Not applicable | | Daily | | 60 days |
The IRS has determined and informed the Company by a letter dated May 1, 2014, that the Plan and related Trust are designed in accordance with applicable sections of the IRC. Although the Plan has been amended since receiving the determination letter, the Plan Administrator believes that the Plan is designed, and is currently being operated, in compliance with the applicable requirements of the IRC and, therefore, believes that the Plan is qualified and the related trust is tax-exempt.
GAAP requires Plan management to evaluate tax positions taken by the Plan and recognize a tax liability if the Plan has taken an uncertain position that more likely than not would not be sustained upon examination by the IRS. The Plan is subject to routine audits by taxing jurisdictions; however, there are currently no audits for any tax periods in progress. The Plan Administrator believes it is no longer subject to income tax examinations for years prior to 2012.
5. | PARTY-IN-INTEREST TRANSACTIONS |
The Plan provides participants the option to invest in the WPP Stock Fund, a party-in-interest. At December 31, 2015 the Plan held 82,178 WPP plc ADSs in the WPP Stock Fund, valued at $9,429,073, and at December 31, 2014 the Plan held 83,304 WPP Group plc ADSs in the WPP Stock Fund valued at $8,671,926.
These transactions qualify as exempt party-in-interest transactions. There have been no known prohibited transactions with parties-in-interest.
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 would become 100% vested in their employer contributions.
11
OGILVY & MATHER SAVINGS AND INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2015 AND 2014, AND FOR THE YEAR ENDED DECEMBER 31, 2015
7. | RISKS AND UNCERTAINTIES |
The Plan invests in various investment securities. Investment securities are exposed to various risks, such as interest rate, market, and credit risks. Due to the level of risk associated with certain investment securities, it is at least reasonably possible that changes in the values of investment securities will occur in the near term and that such changes could materially affect participants’ account balances and the amounts reported in the Statements of Net Assets Available for Benefits.
8. | RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500 |
The following is a reconciliation of net assets available for benefits per the financial statements at December 31, 2015, and 2014, to the IRS Form 5500:
| | | | | | | | |
| | 2015 | | �� | 2014 | |
Net assets available for benefits per financial statements | | $ | 252,840,234 | | | $ | 254,752,713 | |
Deemed loans | | | (189,977 | ) | | | (184,737 | ) |
| | | | | | | | |
Net assets available for benefits per IRS Form 5500 | | $ | 252,650,257 | | | $ | 254,567,976 | |
| | | | | | | | |
*****
12
| | |
EIN: 13-2555496 | | OGILVY & MATHER SAVINGS AND INVESTMENT PLAN |
PN: 001 | | |
| | Form 5500, Schedule H, Part IV, line 4i - |
| | Schedule of Assets (Held at End of Year) |
| | December 31, 2015 |
| | | | | | | | | | | | |
(a) | | (b) Identity of Issue, Borrower, Lessor or Similar Party | | (c) Description of Investment, Including Maturity Date, Rate of Interest, Collateral, Par or Maturity Value | | (d) Cost | | | (e) Current Value | |
| | Common Collective Trust: | | | | | | | | | | |
| | Putnam Stable Value Fund | | Common Collective Trust | | | | ** | | $ | 28,716,085 | |
| | | | | | | | | | | | |
| | | | |
| | Mutual Funds: | | | | | | | | | | |
| | Capital World Growth and Income Fund | | Mutual Fund | | | | ** | | | 10,822,712 | |
| | Fidelity Contra Fund | | Mutual Fund | | | | ** | | | 10,486,970 | |
| | Glenmede Small Cap Equity Fund | | Mutual Fund | | | | ** | | | 13,433,695 | |
| | Harbor International Fund | | Mutual Fund | | | | ** | | | 7,248,872 | |
| | JP Morgan Mid Cap Value Fund | | Mutual Fund | | | | ** | | | 11,150,569 | |
| | Mainstay Large Cap Growth Fund | | Mutual Fund | | | | ** | | | 29,642,557 | |
| | MFS Value Fund | | Mutual Fund | | | | ** | | | 11,563,409 | |
| | Victory Munder Mid Cap Core Growth Fund | | Mutual Fund | | | | ** | | | 6,697,457 | |
| | T. Rowe Price Retirement 2005 Fund | | Mutual Fund | | | | ** | | | 782,517 | |
| | T. Rowe Price Retirement 2010 Fund | | Mutual Fund | | | | ** | | | 669,437 | |
| | T. Rowe Price Retirement 2015 Fund | | Mutual Fund | | | | ** | | | 2,663,142 | |
| | T. Rowe Price Retirement 2020 Fund | | Mutual Fund | | | | ** | | | 5,455,019 | |
| | T. Rowe Price Retirement 2025 Fund | | Mutual Fund | | | | ** | | | 8,200,892 | |
| | T. Rowe Price Retirement 2030 Fund | | Mutual Fund | | | | ** | | | 9,425,841 | |
| | T. Rowe Price Retirement 2035 Fund | | Mutual Fund | | | | ** | | | 12,644,391 | |
| | T. Rowe Price Retirement 2040 Fund | | Mutual Fund | | | | ** | | | 13,983,806 | |
| | T. Rowe Price Retirement 2045 Fund | | Mutual Fund | | | | ** | | | 8,887,592 | |
| | T. Rowe Price Retirement 2050 Fund | | Mutual Fund | | | | ** | | | 6,645,298 | |
| | T. Rowe Price Retirement 2055 Fund | | Mutual Fund | | | | ** | | | 3,363,543 | |
| | Vanguard Extended Market Index Fund | | Mutual Fund | | | | ** | | | 3,205,436 | |
| | Vanguard Institutional Index Fund | | Mutual Fund | | | | ** | | | 19,488,489 | |
| | Vanguard Total Bond Market Index Fund | | Mutual Fund | | | | ** | | | 12,820,120 | |
| | Vanguard Total Intl Stk Index Fund | | Mutual Fund | | | | ** | | | 1,640,894 | |
| | | | | | | | | | | | |
| | Total mutual funds | | | | | | | | | 210,922,658 | |
| | | | | | | | | | | | |
| | Cash | | Cash | | | | | | | 5,799 | |
| | | | | | | | | | | | |
| | WPP Stock Fund: | | | | | | | | | | |
* | | WPP plc | | American Depositary Shares | | | | ** | | | 9,429,073 | |
| | | | | | | | | | | | |
| | Total Investments | | | | | | | | | 249,073,615 | |
| | Notes receivable from participants | | Interest rates from 3.50% - 9.25% maturing through November 2030 | | | | | | | 3,154,279 | |
| | | | | | | | | | | | |
| | Total Assets Held at End of Year | | | | | | | | $ | 252,227,894 | |
| | | | | | | | | | | | |
* | Permitted party-in-interest (a) |
** | Cost information is not required for participant-directed investments and, therefore, is not included above. |
See accompanying Report of Independent Registered Public Accounting Firm.
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| | |
EIN: 13-2555496 | | OGILVY & MATHER SAVINGS AND INVESTMENT PLAN |
PN: 001 | | |
| | Form 5500, Schedule H, Part IV, line 4a - |
| | Schedule of Delinquent Participant Contributions |
| | For the Year Ended December 31, 2015 |
Total that Constitutes Nonexempt Prohibited Transactions
| | | | | | | | | | | | | | | | |
Participant Contributions Transferred Late to Plan | | Contributions Not Corrected | | | Contributions Corrected Outside VFCP | | | Contributions Pending Correction in VFCP | | | Total Fully Corrected Under VFCP and PTE 2002-51 | |
Late Participant Loan Repayments are included | | $ | — | | | $ | 7,897,836 | | | $ | — | | | $ | — | |
The item listed above refers to certain participant contributions that were deposited to the Plan in a delayed manner, caused by an inadvertent administrative error. These contributions have been deposited to the Plan. The Company will make all necessary earnings adjustments to the affected participant accounts.
See accompanying Report of Independent Registered Public Accounting Firm.
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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 hereunto duly authorized.
| | | | | | |
| | | | OGILVY & MATHER SAVINGS AND INVESTMENT PLAN |
| | | |
Date: June 28, 2016 | | | | By: | | /s/ Gerri Stone |
| | | | Name: | | Gerri Stone |
| | | | Title: | | Senior Partner, Director of Benefits NA |
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INDEX TO EXHIBITS
| | |
Exhibit No. | | Description |
| |
23.1 | | Consent of Independent Registered Public Accounting Firm |
16