FORM 11-K
ANNUAL REPORT PURSUANT TO SECTION 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
for the fiscal year ended
December 31, 2001
Commission File No. 1-7564
DOW JONES 401(k) SAVINGS PLAN
(Full title of the plan)
DOW JONES & COMPANY, INC.
200 Liberty Street, New York, NY 10281
(Name of issuer of the securities held pursuant to the
plan and the address of its principal executive office)
Dow Jones 401(k) Savings Plan
Financial Statements
As of December 31, 2001 and 2000 and for the
Year Ended December 31, 2001
Dow Jones 401(k) Savings Plan
Index to Financial Statements
As of December 31, 2001 and 2000 and for the Year Ended December 31, 2001
Page
Report of Independent Accountants 1
Financial Statements:
Statements of Net Assets Available for Plan Benefits as of
December 31, 2001 and 2000 2
Statement of Changes in Net Assets Available for
Plan Benefits for the Year Ended December 31, 2001 3
Notes to Financial Statements 4
Exhibit:
Consent of Independent Accountants
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Plan Committee of the Board of Directors of Dow Jones & Company, Inc.,
administrator of the Plan, has duly caused this annual report to be signed
by the undersigned thereunto duly authorized.
DOW JONES 401(k) SAVINGS PLAN
Date: 06/28/2002 by /s/ Thomas McGuirl
-------------------------- ------------------------------
Treasurer
Dow Jones & Company, Inc.
Report of Independent Accountants
To the Participants and Administrator of
Dow Jones 401(k) Savings Plan:
In our opinion, the accompanying statements of net assets available for
plan benefits and the related statement of changes in net assets available
for plan benefits present fairly, in all material respects, the net assets
available for plan benefits of Dow Jones 401(k) Savings Plan (the "Plan")
at December 31, 2001 and 2000, and the changes in net assets available for
plan benefits for the year ended December 31, 2001 in conformity with
accounting principles generally accepted in the United States of America.
These financial statements are the responsibility of the Plan's management;
our responsibility is to express an opinion on these financial statements
based on our audits. We conducted our audits of these statements in
accordance with auditing standards generally accepted in the United States
of America, which require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant
estimates made by management, and evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable
basis for our opinion.
June 14, 2002
New York, New York
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Dow Jones 401(k) Savings Plan
Statements of Net Assets Available for Plan Benefits
As of December 31, 2001 and 2000
2001 2000
Assets
Investment in the Master Trust $866,474,147 $961,847,789
Participant loans 13,820,880 15,724,371
------------ ------------
Total investments 880,295,027 977,572,160
------------ ------------
Receivables
Employer's contribution 264,224
Participants' contributions 264,022
------------ ------------
Total receivables 528,246
------------ ------------
Net assets available for benefits $880,823,273 $977,572,160
============ ============
The accompanying notes are an integral part of these financial statements.
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Dow Jones 401(k) Savings Plan
Statement of Changes in Net Assets Available for Plan Benefits
For the Year Ended December 31, 2001
Investment results
Investment loss from the Master Trust $(59,237,970)
Interest income from participant loans 1,313,311
-------------
Total investment loss, net (57,924,659)
Additions to net assets attributed to
Contributions to the Plan
By participants 18,332,418
By the employer 17,341,677
------------
Total contributions 35,674,095
Transfers in 941,369
------------
Total additions 36,615,464
------------
Deductions from net assets attributed to
Benefits paid to participants (71,932,493)
Loan cancellations (1,416,303)
Transfers out (2,056,549)
Administrative expenses (34,347)
-------------
Total deductions (75,439,692)
------------
Net decrease (96,748,887)
------------
Net assets available for plan benefits
Beginning of the year 977,572,160
------------
End of the year $880,823,273
============
The accompanying notes are an integral part of these financial statements.
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Dow Jones 401(k) Savings Plan
Notes to Financial Statements
1. Description of Plan
Effective January 1, 2000, the Dow Jones Profit Sharing Retirement Plan was
amended and renamed the Dow Jones 401(k) Savings Plan (the "Plan"). The
following description provides only general information. Participants
should refer to the Plan agreement for a more complete description of the
Plan's provisions.
General
The Plan is a defined contribution plan, and covers eligible employees of
Dow Jones & Company Inc. and certain of its subsidiaries and affiliates
("Dow Jones" or the "Company"). The Plan is subject to the provisions of
the Employee Retirement Income Security Act of 1974 ("ERISA"). Eligible
employees are enrolled in the 401(k) Plan on January 1st or July 1st after
completing six months of service.
Contributions
The 401(k) Plan provides eligible employees with (1) a fixed company
contribution equal to 3% of covered compensation up to $170,000 (the
compensation limit set by the IRS), (2) the opportunity to make employee
pre-tax savings contributions of up to 10% of covered compensation (subject
to IRS limitations), (3) a 100% company match on up to the first 2% of
those employee contributions (subject to IRS limitations), and (4) the
opportunity to make employee contributions on an after-tax basis.
Investment Options
Contributions are participant directed. The Plan provides for several
investment options. During 2001, the Plan offered 28 mutual funds, the Dow
Stock Fund and the Dow Jones Investment Contract Fund.
Vesting
Participants are fully vested in the amount credited to their accounts at
all times.
Loan Fund
Plan participants who are active employees can borrow from their individual
Plan accounts excluding their voluntary after-tax contributions amount.
The minimum amount a participant can borrow is $1,000 and the maximum is
the lesser of $50,000 (reduced by the highest outstanding loan balance
during the previous twelve months) or 50% of the total value of the
participant's Plan accounts, including voluntary after-tax contributions
account, but reduced by any prior outstanding loan balances on the date of
the loan.
The participant's note held by the Loan Fund is pledged as collateral for
the loan. Loan terms range from 1-5 years or up to 10 years for the
purchase of a principal residence. Loans bear interest at rates comparable
to lending institution rates. The interest rate on loans granted during
2001 ranged from 6.0% to 10.0%. Interest rates on loans granted during
2000 ranged from 9.5% to 10.0%.
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Payment of Benefits
The benefit to which a participant is entitled is the benefit that can be
provided from the participant's vested account. On termination of
employment due to death, retirement or other reasons, a participant or his
or her beneficiary is entitled to receive the value of the funds allocated
to the participant's account, in one of the following forms of payment:
single distribution, partial payment distributions, quarterly or annual
installments, or annuity contract with an insurance company.
Loan Cancellations
Loan cancellations are recorded as taxable participant distributions at the
time of cancellation.
Administrative Expenses
Trustee fees of the Plan are paid by the Plan. All other administrative
fees are paid by the Company.
Master Trust
The assets of the Plan are maintained, for investment purposes only, on a
commingled basis with the assets of the Dow Jones Money Purchase Retirement
Plan in the Dow Jones Profit Sharing Retirement Plan Trust (the "Master
Trust"). The plans do not own specific Master Trust assets but rather
maintain individual beneficial interests in such assets. The portion of
fund assets allocable to each plan is based upon the Plan's net assets in
relation to the total Master Trust net assets.
2. Summary of Significant Accounting Policies
Basis of Accounting
The financial statements of the Plan are prepared under the accrual method
of accounting, except for benefit payments, which are recorded when paid.
Investment Valuation and Income Recognition
The investments are held by the Plan's trustee, Fidelity Management Trust
Company ("Fidelity"). The following policy applies to these investments
and any related income subsequently earned.
The investment funds are valued at the net asset value as reported by the
fund managers. Fair values of the underlying investments are based upon
the latest published market quotations, where available. Fair values of
investments not having an established market are determined by the fund
managers by reference to quoted market values and other financial data
pertaining to investments of a similar nature, quality, and yield as
determined by the fund managers. Investments in benefit - responsive
contracts with financial institutions are valued at contract value.
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.
-5-
The Plan presents within investment income/loss in the statement of changes
in net assets available for plan benefits the net appreciation
(depreciation) in the fair value of its investments, and interest and
dividends. Net appreciation (depreciation) in the fair value of
investments consists of the realized gains or losses and the unrealized
appreciation (depreciation) on those investments. Interest and dividends
consists of interest earned on the investment contract fund and dividends
earned on the various investments.
Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions. Actual results could differ from those estimates.
3. Related Party Transactions
Certain Plan investments are shares of mutual funds managed by Fidelity
Management & Research Co., an affiliate of Fidelity. Fidelity is the
trustee as defined by the Plan and, therefore, investments in these mutual
funds qualify as party-in-interest transactions.
4. Concentrations of Credit Risk
Financial instruments which potentially subject the Plan to concentrations
of credit risk consist principally of investment contracts with financial
institutions. These investment contracts typically are uncollateralized
contractual obligations under which the issuer agrees to pay a specific
rate of interest for a fixed period of time and to repay principal at
maturity. The investment contract fund places its contracts with high-
credit quality institutions, limiting the amount of credit exposure to any
one financial institution.
5. Risk and Uncertainties
The Plan provides for various investment options in investment securities.
Investment securities, in general, are exposed to various risks, such as
interest rate, credit and overall market volatility. Due to the level of
risk associated with certain investment securities, it is reasonably
possible that changes in the value of investment securities will occur in
the near term and that such changes could materially affect the amounts
reported in the statement of net assets available for benefits.
6. Plan Termination
Although the Plan sponsor has not expressed any intent to terminate the
Plan, it has the right to do so at any time, subject to the provisions of
ERISA.
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7. Federal Income Taxes
The Internal Revenue Service (IRS) has issued a determination letter dated
March 15, 1995, indicating that the Plan qualifies under Section 401(a) of
the Internal Revenue Code (IRC) and, therefore, the Plan is not subject to
tax under Section 501(a) of the IRC. The Plan is required to operate in
conformity with the IRC to maintain its qualification. The Plan's sponsor
is not aware of any course of action or series of events that have occurred
that might adversely affect the Plan's qualified status. Accordingly, no
provision for federal income taxes has been made.
Effective January 1, 2000, the Plan was amended. The Plan Committee
believes that the Plan, as amended, continues to be designed and operated
in accordance with the requirements of the Internal Revenue Code.
8. Other Matters
Transfers out of $2,056,549 in 2001 consist of Money Purchase Retirement
Funds related to the Company's former Telerate subsidiary transferred from
the Plan to the Dow Jones Money Purchase Retirement Plan.
Transfers in of $941,369 in 2001 consist of qualified participant balances
transferred into the Plan.
9. Interest in Master Trust
The Plan has approximately a 97.6% and a 100% interest in the Master Trust
at December 31, 2001 and December 31, 2000, respectively.
The net assets of the Master Trust are as follows:
2001 2000
Mutual Funds $520,750,645 $616,244,828
Stock Funds 2,902,799 3,151,620
Money Market Funds 73,521,389 65,086,019
Investment contracts 291,148,096 277,365,322
Participant loans 13,822,316 15,724,371
------------ ------------
$902,145,245 $977,572,160
============ ============
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Changes in net assets of the Master Trust for the year ended December 31,
2001 are as follows:
Investment results
Investment income
Interest and dividends $30,611,207
Interest income from participant loans 1,313,355
Net depreciation in mutual funds (91,953,989)
Net depreciation in stock funds (49,456)
------------
Total investment loss, net (60,078,883)
Additions to net assets
Contributions
By participant 17,077,453
By employer 41,472,785
------------
Total contributions 58,550,238
Transfers in 941,369
------------
Total additions 59,491,607
------------
Deductions from net assets
Benefits paid (73,387,129)
Administrative expenses (35,229)
Loan cancellation (1,417,281)
------------
Total deductions (74,839,639)
------------
Net decrease (75,426,915)
------------
Net assets
Beginning of year 977,572,160
------------
End of year $902,145,245
============
-8-
Exhibit
Consent of Independent Accountants
We hereby consent to the incorporation by reference in the Registration
Statement on Form S-8 (No. 33-55079) of Dow Jones & Company, Inc. of our
report dated June 14, 2002 relating to the financial statements of Dow
Jones 401(k) Savings Plan, which appears in this Form 11-K.
PricewaterhouseCoopers LLP
New York, New York
June 27, 2002