FORM 8
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
AMENDMENT TO APPLICATION OR REPORT
Filed pursuant to Section 12, 13 or 15(d) of
THE SECURITIES EXCHANGE ACT OF 1934
COMPUTER SCIENCES CORPORATION
AMENDMENT NO. 1
The undersigned registrant hereby amends the following items, financial
statements, exhibits or other portions of its fiscal year 1994 Annual Report
on Form 10-K as set forth in the pages attached hereto:
Exhibit 99.3, to include as such exhibit pursuant to Rule 15d-21 under the
Securities Exchange Act of 1934 the information, financial statements and
exhibits required by Form 11-K with respect to the CSC Credit Services, Inc.
Employee Savings Plan.
Pursuant to the requirement of the Securities Exchange Act of 1934, the
registrant has duly caused this amendment to be signed on its behalf by the
undersigned, thereunto duly authorized.
COMPUTER SCIENCES CORPORATION
(Registrant)
Date: March 17, 1995 By: \s\Denis M. Crane
Denis M. Crane
Vice President and Controller
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
For the Plan Year Ended September 30, 1994
CSC CREDIT SERVICES, INC.
EMPLOYEE SAVINGS PLAN
COMPUTER SCIENCES CORPORATION
2100 East Grand Avenue
El Segundo, California 90245
Item 1. Changes in the Plan
Effective July 1, 1994 amendments to the Plan include a
modification to the definition of Plan compensation, the
introduction of participant loans and an addition of an
investment fund.
Item 2. Changes in Investment Policy
During the year a new investment fund was added to the Plan
providing an opportunity for the participants to invest in a
balanced portfolio of U.S. stocks, bonds and cash.
Item 3. Contributions Under the Plan
Employer contributions under the Plan are measured to the
participants' contributions.
Item 4. Participating Employees
Approximately 814 employees participated in the Plan at September
30, 1994.
Item 5. Administration of the Plan
(a) The Plan is administered by a Plan subcommittee Which consists of
the following employees of CSC Credit Services, Inc., 652 North
Belt,Houston, Texas 77060: Margaret A. Strnad, Director of Human
Resources, Dwight L. Carmichael, Vice President, Finance &
Administration, John L. Mote, Director of Communications.
The Plan subcommittee manages the Plan at the direction of the
Plan Committee.
The general administration and operation of the Plan is vested
in the Plan Committee, which consists of the following employees
of Computer Sciences Corporation ("CSC"), located at 2100 E.
Grand Avenue, El Segundo, California 90245.
Leon J. Level, Chairman - Vice President and Chief Financial
Officer of CSC
Hayward D. Fisk, Vice President, Secretary and General Counsel
of CSC
Denis M. Crane, Vice President and Controller of CSC
L. Scott Sharpe, Vice President of CSC
Texas Commerce Trust Company N.A., (the Trustee) located at 5599
San Felipe, Houston, Texas 77056, acts as the Trustee under
the Plan.
(b) No person named above receives any compensation from the Plan.
Item 6. Custodian of Investments
(a) The Trustee, a Texas state chartered trust company, serves as
custodian of the securities and other investments of the Plan.
(b) The Trustee receives no compensation from the Plan for its services.
All expenses for administration of the Plan are paid by CSC Credit
Services, Inc.
(c) Texas Commerce Trust Company N.A., has the following insurance
coverage:
(1) A Bankers Blanket Bond, Excess Fidelity Coverage and Excess
Securities Coverage totaling $365,000,000, covers any losses due
to employee dishonesty, burglary, robbery, theft, mysterious
disappearance, and forged or counterfeit securities. The
coverage also applies to losses of "property" in transit by
armored car service companies, air courier companies, authorized
bank employees, and "designated messengers".
(2) A Bankers Professional Liability Coverage totaling $30,000,000
covers trust errors and omissions.
(3) Primary and excess Fiduciary General Liability provides coverage
totaling $200,000,000.
Item 7. Reports to Participating Employees
Participants are furnished with quarterly reports reflecting the status of
their accounts. These reports show the beginning balance, contributions,
investment income, withdrawals and ending balances for each investment
election and for each account (employee contributions, employer contributions
and roll-over accounts).
The summary annual report of the Plan was distributed and will continue to be
distributed to each participant within nine months or up to eleven months with
extension, following close of the Plan year.
Item 8. Investment of Funds
Any fees incidental to the management of the investments of a particular
investment fund are netted against the return of that fund when applied to
the assets of the Plan.
Item 9. Financial Statements and Exhibits
Description Page No.
(a) Financial Statements:
Independent Auditors' Report F-1
Statements of Net Assets Available for Benefits -
Combined Funds - September 30, 1994 and 1993 F-2
Statements of Changes in Net Assets Available for
Benefits - Combined Funds - for the years ended
September 30, 1994 and 1993 F-3
Notes to Financial Statements F-4
Statements of Net Assets Available for Benefits
and Changes in Net Assets Available
for Benefits - by Fund - for the years
ended September 30, 1994 and 1993 F-8 & F-9
(b) Exhibit:
Independent Auditors' Consent E-1
Pursuant to the requirements of the Securities Act of 1934, the Plan Committee
has duly caused this annual report to be signed by the undersigned thereunto
duly authorized.
CSC CREDIT SERVICES, INC.
EMPLOYEE SAVINGS PLAN
Date: March 17, 1995 By: /S/Denis M. Crane
Denis M. Crane
Vice President & Controller
Computer Sciences Corporation
INDEPENDENT AUDITORS' REPORT
To the Plan Committee of CSC Credit Services, Inc.
Employee Savings Plan:
We have audited the accompanying statements of net assets available
for benefits of CSC Credit Services, Inc. Employee Savings Plan (the
"Plan") as of September 30, 1994 and 1993, and the related statements
of changes in net assets available for benefits for the years then
ended. These financial statements are the responsibility of the
Plan's management. Our responsibility is to express an opinion on
these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting
principles used of 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 September 30, 1994 and 1993, and the
changes in net assets available for benefits for the years then ended
in conformity with 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 supplemental
schedules of (1) assets held for investment as of September 30, 1994
and (2) reportable transactions for the year ended September 30, 1994
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 Fund Information in the statement of
changes in net assets available for benefits as of September 30, 1994
and 1993, included in Note 10 to the accompanying financial
statements, is presented for purposes of additional analysis rather
than to present the changes in net assets available for plan benefits
of each fund. The supplemental schedules and Fund Information have
been subjected to the auditing procedures applied in our audits 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.
December 9, 1994
CSC CREDIT SERVICES, INC. EMPLOYEE SAVINGS PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS,
SEPTEMBER 30, 1994 AND 1993
ASSETS 1994 1993
INVESTMENTS, at fair value:
Trustee Short-Term Cash Management Fund $ 662,428 $ 486,141
Computer Sciences Corporation - common stock (39,972
and 30,162 shares, respectively) 1,738,782 922,455
Vanguard Group - Short-Term Bond Fund (19,032 shares) 199,080
Vanguard Group - Windsor Fund Incorporated II
(241,384) and 205,031 shares, respectively) 4,098,705 3,653,660
Brinson Trust Company US (1,954 units) 251,382
Fixed income contracts:
Executive Life Insurance Company 239,917 239,917
General American Life Insurance Company 950,582 876,720
Hartford Life Insurance Company 949,507 875,718
Protective Life Insurance Company 745,243 1,188,197
Provident National Assurance Company 1,555,894 1,441,515
Prudential Insurance Company of America 646,495 532,509
RECEIVABLES:
Contributions 115,112 70,650
Interest 31,853 32,026
------------ -----------
NET ASSETS AVAILABLE FOR BENEFITS $12,184,980 $10,319,508
=========== ===========
<FN>
See accompanying notes to financial statements.
CSC CREDIT SERVICES, INC. EMPLOYEE SAVINGS PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEARS ENDED SEPTEMBER 30, 1994 AND 1993
1994 1993
INVESTMENT INCOME:
Net appreciation in fair value of investments $ 242,482 $ 542,334
Interest and dividends 644,269 566,566
---------- ----------
Total 886,751 1,108,900
---------- ----------
CONTRIBUTIONS:
Employer 408,833 440,520
Employee 1,310,753 1,141,121
---------- ----------
Total 1,719,586 1,581,641
---------- ---------
Total additions 2,606,337 2,690,541
---------- ----------
BENEFITS PAID TO PARTICIPANTS (740,865) (2,231,188)
---------- ----------
INCREASE IN NET ASSETS AVAILABLE FOR BENEFITS 1,865,472 459,353
NET ASSETS AVAILABLE FOR BENEFITS:
Beginning of year 10,319,508 9,860,155
----------- -----------
End of year $12,184,980 $10,319,508
=========== ===========
<FN>
See accompanying notes to financial statements.
CSC CREDIT SERVICES, INC. EMPLOYEE SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED SEPTEMBER 30, 1994 AND 1993
1. DESCRIPTION OF PLAN
The following description of the CSC Credit Services, Inc.
Employee Savings Plan (the "Plan") provides only general
information. Participants should refer to the plan documents for a
more complete description of the Plan's provisions.
Effective July 1, 1994, the Board of Directors of CSC Enterprises,
Inc., the general partner of CSC Credit Services, Inc. (the
"Company"), authorized the amendment and restatement of the Plan.
The amendments include, among other things, a modification of the
definition of plan compensation, the introduction of participant
loans and an additional participant investment fund option (the
"Balanced Fund"). The introduction of these amendments had no
adverse effect on the administration or the net assets available
for benefits of the Plan.
General - Effective October 1, 1987, Associated Credit Services,
Inc., established the Associated Credit Services, Inc. Employee
Savings Plan. The Plan's name was subsequently changed to the CSC
Credit Services, Inc. Employee Savings Plan.
The Plan is a defined contribution savings plan for employees of
the Company. Employees are eligible to participate after
completing an employment year consisting of at least 1,000 hours
of service. The Plan is subject to provisions of the Employee
Retirement Income Security Act of 1974 and its subsequent
amendments and is considered a "cash or deferred arrangement"
under Section 401(k) of the Internal Revenue Code of 1986. The
general administration and operation of the Plan is vested in the
Plan Committee (the "Committee"). The trustee of the Plan is
Texas Commerce Trust Company N.A. (the "Trustee"), formerly
Ameritrust Texas N.A.
Employee contributions are invested at each employee's discretion
in the General Equity Fund, Fixed Income Fund, Common Stock Fund
or Balanced Fund on a percentage allocation basis in any increment
of 25%. The General Equity Fund is invested in a pooled
investment fund which, in turn, is invested in equity investments.
The Fixed Income Fund is invested in contracts with insurance
companies and short-term cash investments. The Company Stock Fund
is invested in Computer Sciences Corporation common stock. The
Balanced Fund is invested in U.S. equities and in bonds and cash
equivalents.
Contributions - Participants may contribute (not to exceed $9,240
and $8,994 for calendar years 1994 and 1993, respectively) from 2%
to 15% of their compensation. Employer contributions equal 50% of
the first 6% of a participant's contributions, not to exceed 3% of
the participant's plan compensation.
Participant Loans - A participant may apply for a loan in the
vested portion of his or her account. Each participant is
entitled to one outstanding loan under the Plan. The maximum
amount of the loan, including any outstanding loans from any other
plan of the employer or an affiliate, shall be the lesser of
$50,000 or 50% of the present value of the participant's vested
account balance under the Plan with a minimum loan amount of
$1,000. The balance of the loan shall be for a term of 12 to 60
months, bearing interest at a reasonable rate as defined unless
the loan proceeds are used to acquire a primary residence in which
case the loan shall be for a term not to exceed 15 years. As of
September 30, 1994, there were no participant loans included in
the assets of the Plan.
Participant Accounts - Each participant's account is credited with
the participant's contributions, the Company's matching
contributions and earnings. Allocations are based primarily on
account balances at certain specified dates as provided under the
terms of the Plan.
Vesting - Upon normal retirement, death or disability, a
participant is entitled to the entire balance of his or her
account. If a participant's employment is terminated for any
other reason, such participant is entitled to the total of his or
her employee contributions plus a vested percentage of the
Company's matching contributions. Participants vest in Company
contributions as follows:
Vesting Service Vesting Percent
Less than 2 years 0
2 years but less than 3 25
3 years but less than 4 50
4 years but less than 5 75
5 years or more 100
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Accounting Basis - The financial statements are prepared on the
accrual basis of accounting in accordance with generally accepted
accounting principles.
Investments - Investments are presented in the financial
statements at their fair value using the first-in, first-out
method. If available, quoted market prices are used to value
investments. Investments in fixed income contracts are reported
at contract values, which management believes approximate fair
values.
Benefit Payments - Benefit payments are recorded when paid.
Administrative Expenses - Administrative expenses are paid by the
Company.
3. CONTRIBUTIONS
Included in employee contributions for 1994 and 1993 is $28,140
and $4,690, respectively, consisting of lump sum distributions to
employees rolled over from other employee benefit plans.
4. RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500
The following is a reconciliation of net assets available for
benefits per the financial statements to the Form 5500:
September 30,
1994 1993
---------- -----------
Net assets available for benefits per the
financial statements $12,184,980 $10,319,508
Amounts allocated to withdrawing participants (404,599) (22,688)
----------- -----------
Net assets available for benefits per the form 5500 $11,780,381 $10,296,820
=========== ===========
The following is a reconciliation of benefits paid to participants
per the financial statements to the Form 5500:
Year Ended
September 30, 1994
Benefits paid to participants per the financial statements $ 740,865
Add: Amounts allocated to withdrawing participants at
September 30, 1994 404,599
Less: Amounts allocated to withdrawing participants at
September 30, 1993 (22,688)
----------
Benefits paid to participants per the Form 5500 $1,122,776
==========
Amounts allocated to withdrawing participants are recorded on the
Form 5500 for benefit claims that have been processed and approved
for payment prior to September 30 but not yet paid as of that
date.
5. FEDERAL INCOME TAXES
The Plan obtained its latest tax determination letter on August 1,
1988, in which the Internal Revenue Service ("IRS") stated that
the Plan, as then designed, was in compliance with the applicable
requirements of the Internal Revenue Code. The Plan is in the
process of applying for a tax determination letter from the IRS
which incorporates all amendments under the amended plan document,
effective July 1, 1994. The plan administrator and the Plan's tax
counsel believe that the Plan as currently designed is being
operated in compliance with the applicable requirements of the
Internal Revenue Code. Therefore, they believe that the Plan is
qualified and considered tax-exempt as of the financial statement
date.
6. FORFEITURES
Upon termination, the nonvested portion of a participant's
employer contribution account is forfeited and held in suspense.
If a participant resumes service under the Plan, he or she may,
under certain circumstances, have the forfeited suspense account
reinstated (including gains or losses). If the terminated
employee is not re-employed before completion of five consecutive
one-year breaks in service, his or her forfeited suspense account
shall become available for allocation. The Company reserves the
right to use the forfeited balance to reduce future contributions
by the employer. Accumulated forfeitures amounted to $44,853 and
$63,676 for the years ended September 30, 1994 and 1993,
respectively. During 1994 and 1993, the Company elected to
utilize $73,068 and $0, respectively, of accumulated forfeitures
to reduce employer contributions to the Plan.
7. TERMINATION OF PLAN
Although it has not expressed any intent to do so, the Company
reserves the right under the Plan to discontinue its contributions
and terminate the Plan, in whole or in part, at any time subject
to the provisons of ERISA. In the event of Plan termination, all
participants will be 100 percent vested in their accounts.
8. CONTINGENCIES
The Plan holds an investment in an Executive Life Insurance
Company ("ELIC") fixed income contract which matured September 30,
1992. ELIC is a wholly owned subsidiary of First Executive
Corporation ("FEC"). FEC, a holding company, filed for relief
under Chapter 11 of the United States Bankruptcy Code on May 13,
1991. On December 26, 1991, a California state court approved a
purchase by Aurora National Life Assurance Company ("Aurora") of
ELIC's assets and liabilities by a consortium led by Altus Finance
and Mutuelle Assurance Artisanale de France. A
Rehabilitation/Liquidation Plan for ELIC (the "Rehabilitation")
was filed January 13, 1992 subject to approval by the California
Superior Court. On August 13, 1993, the Rehabilitation was
approved. The outcome resulting from the Rehabilitation is not
fully known. However, it is expected that the impact, if any,
will have no material effect on the aggregate assets of the Plan.
9. RELATED-PARTY TRANSACTIONS
During the years ended September 30, 1994 and 1993, the Plan
purchased and sold shares of Computer Sciences Corporation common
stock and units of short-term cash management funds managed by the
Trustee as temporary investments, as shown below:
1994 1993
--------------------- ----------------------
Purchases Sales Purchases Sales
Computer Sciences Corporation:
Shares 9,827 17 9,057 1,413
Dollars $ 395,644 $ 669 $ 233,463 $ 396,082
========== ========== ========== ==========
Trustee - Short-Term Cash
Management Fund $2,903,946 $2,288,118 $2,122,969 $2,187,933
========== ========== ========== ==========
On December 16, 1993 the stockholders of Computer Science Corporation
approved a 3 for 1 stock split in the form of a 200% stock dividend to holders
of record on December 22, 1993. All references herein regarding the number of
shares of Computer Science Corporation common stock have been adjusted to give
retroactive effect to the stock split.
10. SUPPLEMENTAL SCHEDULE OF FUND INFORMATION
The Plan consists of four investment funds. Each participant
directs the manner in which his or her account balance is
invested. The net assets available for benefits by fund and
changes in net assets available for benefits by fund for the years
ended September 30, 1994 and 1993 are as follows:
1994
------------------------------------------------------------
Fixed General Common Balanced
Combined Income Equity Stock Investment
Funds Fund Fund Fund Fund
Investment Income:
Net appre-
ciation (depre-
ciation)
in fair value
of investments $ 242,482 $ (641) $ (180,158) $ 421,115 $ 2,166
Interest
and dividends 644,269 423,280 219,580 856 553
----------- --------- ---------- ---------- -------
Total 886,751 422,639 39,422 421,971 2,719
------------ --------- ---------- ---------- -------
Contributions:
Employer 408,833 146,639 187,255 67,791 7,148
Employee 1,310,753 454,591 623,725 205,847 26,590
------------ --------- ---------- ---------- -------
Total 1,719,586 601,230 810,980 273,638 33,738
------------ --------- ---------- ---------- -------
Total additions 2,606,337 1,023,869 850,402 695,609 36,457
------------ --------- ---------- ---------- -------
Benefits paid to
participants (740,865) (373,704) (328,952) (38,209)
Interfund
transfers, net (414,958) 35,068) 158,595 291,431
----------- --------- ---------- ---------- -------
Increase in
net assets
available for
benefits 1,865,472 235,207 486,382 815,995 327,888
Net assets
available for
benefits:
Beginning of
year 10,319,508 5,686,376 3,689,865 943,267
----------- ---------- ---------- ---------- -------
End of year $12,184,980 $5,921,583 $4,176,247 $1,759,262 $327,888
=========== ========== ========== ========== ========
1993
-------------------------------------------------
Fixed General Common
Combined Income Equity Stock
Funds Fund Fund Fund
Investment Income:
Net appreciation in fair
value of investments $ 542,334 $ 337,055 $ 205,279
Interest and dividendS 566,566 $ 446,191 120,107 268
----------- ---------- ---------- ----------
Total 1,108,900 446,191 457,162 205,547
----------- ---------- ---------- ----------
Contributions:
Employer 440,520 196,074 182,761 61,685
Employee 1,141,121 491,739 485,551 163,831
----------- ----------- ---------- ----------
Total 1,581,641 678,813 668,312 225,516
----------- ----------- ---------- ----------
Total additions 2,690,541 1,134,004 1,125,474 431,063
----------- ----------- ---------- ----------
Benefits paid to
participants (2,231,188) (1,845,998) (342,696) (42,494)
Interfund transfers,
net (411,836) 459,140 (47,304)
----------- ----------- ---------- ----------
Increase (decrease)
in net assets
available for benefits 459,353 (1,123,830) 1,241,918 341,265
Net assets available
for benefits:
Beginning of year 9,860,155 6,810,206 2,447,947 602,002
----------- ---------- ---------- ----------
End of year $10,319,508 $5,686,376 $3,689,865 $ 943,267
=========== ========== ========== ==========
INDEPENDENT AUDITORS' CONSENT
We hereby consent to the incorporation by reference in Registration
Statement No. 33-26977 of Computer Sciences Corporation on Form S-8 of
our report dated December 9, 1994 appearing in this Annual Report on
Form 11-K of CSC Credit Services, Inc. Employee Savings Plan for the
year ended September 30, 1994.
Houston, Texas
January 19, 1995