Audited Financial Statements
M.A. Hanna Company Capital
Accumulation Plan and Trust
December 31, 1993 and 1992
Report of Independent Auditors
Committee for Employee Benefits Administration
M.A. Hanna Company Capital Accumulation
Plan and Trust
We have audited the accompanying statements of net assets
available for plan benefits of the M.A. Hanna Company Capital
Accumulation Plan and Trust as of December 31, 1993 and 1992, and
the related statement of changes in net assets available for plan
benefits for the year ended December 31, 1993. 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 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
plan benefits of the Plan at December 31, 1993 and 1992, and the
changes in its net assets available for plan benefits for the
year ended December 31, 1993, in conformity with generally
accepted accounting principles.
Our audits were made for the purpose of forming an opinion on the
basic financial statements taken as a whole. The accompanying
supplemental schedules of assets held for investment as of
December 31, 1993, and transactions or series of transactions in
excess of five percent of the current value of plan assets for
the year then ended, are presented for purposes of complying with
the Department of Labor's Rules and Regulations for Reporting and
Disclosure under the Employee Retirement Income Security Act of
1974, and are not a required part of the basic financial
statements. The supplemental schedules have been subjected to the
auditing procedures applied in our audit of the 1993 financial
statements and, in our opinion, are fairly stated in all material
respects in relation to the 1993 basic financial statements taken
as a whole.
/s/ Ernst & Young
June 24, 1994
M.A. HANNA COMPANY CAPITAL ACCUMULATION PLAN AND TRUST
STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
December 31, 1993
Wells Fargo Mutual Funds
-------------------------------------------------------------------
U.S.
Asset Bond Treasury Money
Sweep Allocation Index S&P 500 Allocation Market
Account Fund Fund Stock Fund Fund Fund
--------- ----------- --------- ------------ ------------ -----------
Assets
Investments at fair value $123 $2,246,406 $374,530 $3,738,710 $11,974,740 $3,944,635
Employer's contribution receivable 3,159 385 948 721 512
Employees' contribution receivable 6,688 804 2,010 1,578 1,058
Participant loans
_________ ___________ _________ ____________ ____________ ___________
Net assets available for plan benefits $123 $2,256,253 $375,719 $3,741,668 $11,977,039 $3,946,205
========= =========== ========= ============ ============ ===========
See notes to financial statements
Tilts
& M.A. Hanna
Timing Company
Fund Stock Fund Loans Total
--------- ----------- --------- ------------
Assets
Investments at fair value $716,975 $3,837,180 $0 $26,833,299
Employer's contribution receivable 286 9,077 15,088
Employees' contribution receivable 608 3,216 15,962
Participant loans 250,890 250,890
_________ ___________ _________ ____________
Net assets available for plan benefits $717,869 $3,849,473 $250,890 $27,115,239
========= =========== ========= ============
M.A. HANNA COMPANY CAPITAL ACCUMULATION PLAN AND TRUST
STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
December 31, 1992
Wells Fargo Collective Investment Funds
-------------------------------------------------------------------
Three Way U.S. Tilts
Asset Bond Treasury &
Sweep Allocation Index S&P 500 Allocation Timing
Account Fund Fund Stock Fund Fund Fund
--------- ----------- --------- ------------ ------------ -----------
Assets
Investments at fair value $1,924 $1,089,284 $284,807 $3,421,826 $12,064,671 $330,470
Employer's contribution receivable 3,137 403 670 738 236
Employees' contribution receivable 6,534 819 1,373 1,517 488
Interest receivable 381
Participant loans
_________ ___________ _________ ____________ ____________ ___________
Net assets for plan benefits $2,305 $1,098,955 $286,029 $3,423,869 $12,066,926 $331,194
========= =========== ========= ============ ============ ===========
See notes to financial statements.
-----------
Money M.A. Hanna
Market Company
Fund Stock Fund Loans Total
----------- ----------- --------- ------------
Assets
Investments at fair value $2,553,931 $2,359,832 $0 $22,106,745
Employer's contribution receivable 686 8,968 14,838
Employees' contribution receivable 6,839 3,155 20,725
Interest receivable 381
Participant loans 152,928 152,928
___________ ___________ _________ ____________
Net assets for plan benefits $2,561,456 $2,371,955 $152,928 $22,295,617
=========== =========== ========= ============
M.A. HANNA COMPANY CAPITAL ACCUMULATION PLAN AND TRUST
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
WELLS FARGO COLLECTIVE INVESTMENT FUNDS
------------------------------------------------------------------
Three-Way S&P US
Asset Bond 500 Treasury Tilts &
Sweep Allocation Index Stock Allocation Timing
Account Fund Fund Fund Fund Fund
--------- ----------- --------- ----------- ------------ ---------
NET ASSETS AVAILABLE FOR PLAN
BENEFITS AS OF JANUARY 1, 1993 $2,305 $1,098,955 $286,029 $3,423,869 $12,066,926 $331,194
Investment Income:
Net realized and unrealized appreciation
(depreciation) in fair value of
investments 131,019 23,852 126,832 1,403,399 54,351
Interest 23
Dividends
--------- ----------- --------- ----------- ------------ ---------
23 131,019 23,852 126,832 1,403,399 54,351
Contributions:
Employer 127,345 15,731 36,939 35,672 23,475
Employees 144,489 21,048 100,231 56,975 54,961
----------- --------- ----------- ------------ ---------
271,834 36,779 137,170 92,647 78,436
Distribution to employees partially and
wholly withdrawn from the Plan (180) (41,951) (3,801) (80,477) (130,259) (53,621)
Net transfer (to) from other funds (1,574) (1,701,833) (415,766) (3,776,193) (13,820,306) 261,487
Transfers (out) in (451) 241,976 72,907 168,799 387,613 46,022
Administrative expenses (20)
--------- ----------- --------- ----------- ------------ ---------
Net (decrease) increase (2,182) (1,098,955) (286,029) (3,423,869) (12,066,926) 386,675
--------- ----------- --------- ----------- ------------ ---------
NET ASSETS AVAILABLE FOR PLAN
BENEFITS AS OF DECEMBER 31, 1993 $123 $0 $0 $0 $0 $717,869
========= =========== ========= =========== ============ =========
See notes to financial statements
WELLS FARGO MUTUAL FUNDS
----------------------------------------------------------------------
U.S.
Money Asset Bond S&P Treasury
Market Allocation Index 500 Allocation
Fund Fund Fund Stock Fund Fund
----------- ----------- ---------- ----------- ------------
NET ASSETS AVAILABLE FOR PLAN
BENEFITS AS OF JANUARY 1, 1993 $2,561,456 $0 $0 $0 $0
Investment Income:
Net realized and unrealized appreciation
(depreciation) in fair value of
investments 52,652 (2,335) 167,605 (41,062)
Interest 36,780
Dividends 58,495 11,351 46,465 700,377
----------- ----------- ---------- ----------- ------------
36,780 111,147 9,016 214,070 659,315
Contributions:
Employer 65,711 45,776 6,234 18,006 (10,980)
Employees 60,573 130,476 34,828 87,556 13,456
----------- ----------- ---------- ----------- ------------
126,284 176,252 41,062 105,562 2,476
Distribution to employees partially and
wholly withdrawn from the Plan (200,908) (13,766) (3,275) (48,586) (178,594)
Net transfer (to) from other funds (2,711,957) 2,034,891 378,831 3,570,805 11,493,872
Transfers (out) in 188,345 (52,270) (49,915) (100,183)
Administrative expenses (1) (30)
----------- ----------- ---------- ----------- ------------
Net (decrease) increase (2,561,456) 2,256,253 375,719 3,741,668 11,977,039
----------- ----------- ---------- ----------- ------------
NET ASSETS AVAILABLE FOR PLAN
BENEFITS AS OF DECEMBER 31, 1993 $0 $2,256,253 $375,719 $3,741,668 $11,977,039
=========== =========== ========== =========== ============
--------------
Money M.A. Hanna
Market Company
Fund Stock Fund Loans Total
----------- ----------- --------- ------------
NET ASSETS AVAILABLE FOR PLAN
BENEFITS AS OF JANUARY 1, 1993 $0 $2,371,955 $152,928 $22,295,617
Investment Income:
Net realized and unrealized appreciation
(depreciation) in fair value of
investments 492,538 2,408,851
Interest 13,743 50,546
Dividends 41,885 858,573
----------- ----------- --------- -------------
41,885 492,538 13,743 3,317,970
Contributions:
Employer 38,089 328,887 730,885
Employees 53,538 103,074 861,205
----------- ----------- -------------
91,627 431,961 1,592,090
Distribution to employees partially and
wholly withdrawn from the Plan (138,619) (74,535) (11,772) (980,344)
Net transfer (to) from other funds 3,951,323 640,429 95,991 0
Transfers (out) in (10,291) 892,552
Administrative expenses (11) (2,584) (2,646)
----------- ----------- --------- ------------
Net (decrease) increase 3,946,205 1,477,518 97,962 4,819,622
----------- ----------- --------- ------------
NET ASSETS AVAILABLE FOR PLAN
BENEFITS AS OF DECEMBER 31, 1993 $3,946,205 $3,849,473 $250,890 $27,115,239
=========== =========== ========= =============
M.A. Hanna Company Capital Accumulation Plan and Trust
Notes to Financial Statements
December 31, 1993 and 1992
A. Significant Accounting Policies
The accounting records of the Capital Accumulation Plan and Trust
(the Plan) are maintained on the accrual basis.
The change in the difference between fair value and cost of
investments is reflected in the statement of changes in net assets
available for plan benefits as unrealized appreciation
(depreciation).
The Wells Fargo Collective Investment Funds ("the Funds") invest
in units of Wells Fargo Institutional Trust Company ("WFITC")
Collective Trust Funds for Employee Benefit Trusts ("the Master
Funds") which have similar investment objectives to the Funds.
The Funds also invest in the Money Market Fund as a short-term
investment vehicle.
Effective July 2, 1993, certain Wells Fargo Collective
Investment Funds were converted to the Stagecoach Inc. mutual
funds of Wells Fargo ("the Funds").
Wells Fargo Bank, N.A. ("Wells Fargo") is the Trustee and
Investment Manager of the Funds. WFITC is the Trustee and
Investment Manager of the Master Funds and receives
investment advice from Wells Fargo Nikko Investment
Advisors.
The following is a summary of significant accounting
policies consistently followed by Wells Fargo:
Fund Valuation
Valuation of the Funds' units occurs daily. Unit values are
determined by dividing the value of each Fund's net assets by
the number of units outstanding on the valuation date.
Units of the Master Funds are valued on the basis of the unit
value established by WFITC for each fund at each valuation
date.
The Bond Index Fund invests in units of the WFITC
Government/Corporate Bond Index Fund ("Bond Master Fund").
The Bond Master Fund's units are valued approximately
once every five business days ("Master Fund Valuation
Date"). Daily valuations of the Bond Master Fund are
calculated by adjusting its unit value on the most recent
Master Fund Valuation Date for subsequent changes in
the Lehman Brothers Government/Corporate Bond Index.
Valuation of Investments
Securities traded on securities exchanges are valued at the
last reported sales price on the valuation date, or in the
absence of any sales, at the last reported bid price on the
valuation date. Securities traded over-the- counter are valued
at the final bid price on the valuation date. Securities
not traded are valued on the basis of quotations from pricing
services or securities dealers.
U.S. Treasury obligations are valued daily at the mean of bid
and ask prices.
Investment Transactions and Investment Income
Investment transactions are accounted for on the trade date.
Dividend income is recognized on the ex-dividend date, and
interest income is recognized on the accrual basis. The cost
of investments sold is computed on an average cost basis.
B. Description of the Plan
The following description of the Plan provides only general
information. Participants should refer to the Plan
agreement for a more complete description of the Plan's
provisions.
The Plan is a defined contribution plan and is offered to
salaried associates of M.A. Hanna Company and certain
associated companies who have completed six months of
continuing service.
The purpose of this Plan is to provide these employees with an
opportunity to accumulate savings for their retirement while at
the same time providing withdrawal features due to early
termination or retirement. The terms of the Plan permit
eligible associates to contribute after-tax dollars from 1% to
14% each month through payroll deductions and provide for matching
contributions (up to 7-1/2% of their salary) by their respective
employer. 50% of the employer matching contribution is
automatically invested in the M.A. Hanna Stock Fund. The
remaining 50% is allocated in accordance with the participant's
election .
Participants are fully vested in their account balance at all
times.
Employer contributions become vested at the end of the
calendar year in which the contributions are made provided the
participant is employed on the last day of the calendar year.
Nonvested contributions forfeited by terminated employees serve
to reduce contributions made by the respective participating
companies.
A separate account is maintained for each participating
employee which shows that participant's interest in each of the
funds. Subject to certain limitations, an employee can make a
voluntary withdrawal from the account at any time.
Upon termination of service, a participant may elect to receive
either a lump-sum equal to the value of his or her account, or
periodic installments over a period not to exceed the life
expectancy of the participant and his or her spouse.
The Company reserves the right to terminate or modify the Plan.
In the event of a complete termination of the Plan, all
participant accounts become 100% vested and the net assets of
the Plan are to be set aside for distribution to Plan participants
in a manner elected by each and as permitted under the
provisions of the Plan. The Plan administrator has received
notice that the Plan is not covered by the Pension Benefit
Guaranty Corporation.
C. Transactions with Parties-in-Interest
All expenses of administering the Plan are ratably shared by M.A.
Hanna Company and the other participating companies. Investment
management fees are paid by participants in that management fees
reduce the investment return reported and credited to
participants.
D. Investments
The individual investments that reresent 5% or more of the fair value of
net assets available for plan benefits at December 31, 1993 and 1992 are:
1993 1992
M.A. Hanna Company Stock Fund $3,837,180 $2,359,832
Wells Fargo Mutual Funds:
Asset Allocation Fund 2,246,406
S&P 500 Stock Fund 3,738,710
U.S. Treasury Allocation Fund 11,974,740
Money Market Fund 3,944,635
Wells Fargo Collective Investment Funds:
S&P 500 Stock Fund 3,421,826
U.S. Treasury Allocation Fund 12,064,671
Money Market Fund 2,553,931
E. Income Tax Status
The Internal Revenue Service (the IRS) has ruled that the Plan
qualifies under Section 401(a) of the Internal Revenue Code and
that the Trust is exempt under Section 501(a) of the Internal
Revenue Code and is, therefore, not subject to tax under present
income tax laws. Continued qualification of the Plan depends
upon timely adoption and operational application of certain
amendments required as a result of the Tax Reform Act of 1986
(the Act). In the Company's opinion, the Plan is operating in
compliance with the applicable provisions of the Act. A
determination has been requested from the IRS as to the
qualification of the Plan, with respect to amendments required as
a result of the Act. The Company is not aware of any course of
action or series of events that have occurred that might adversely
affect the Plan's qualified status.
M.A. Hanna Company Capital Accumulation Plan and Trust
Schedule 27(a) - Schedule of Assets Held for Investment Purposes
December 31, 1993
Identity of Issue, Borrower, Lessor Description of Current
or Similar Party Investment Cost Value
- - ----------------------------------------- ------------------------- ------------ ------------
Cash $123 $123
M.A. Hanna Company Stock Fund 227,996 units 3,059,603 3,837,180
Wells Fargo Mutual Funds:
Asset Allocation Fund 218,735 units 2,208,451 2,246,406
Bond Index Fund 37,679 units 376,856 374,530
S&P 500 Stock Fund 385,114 units 3,618,787 3,738,710
U.S. Treasury Allocation Fund 1,205,915 units 12,070,272 11,974,740
Money Market Fund 3,944,635 units 3,944,635 3,944,635
------------ ------------
22,219,001 22,279,021
Wells Fargo Collective Investment Funds:
Tilts & Timing Fund 52,487 units 651,397 716,975
Participant Loans Various personal loans
ranging from 6.1 to 7.5%
with terms of 1 - 5 years 250,890 250,890
------------ ------------
$26,181,014 $27,084,189
============ ============
M.A. Hanna Company Capital Accumulation Plan and Trust
Schedule 27(d) - Schedule of Reportable Transactions
December 31, 1993
Series Of Transactions
Purchases Sales
------------------------- --------------------------
Identity of Party Involved Description Number Amount Number Cost
- - ----------------------------------------- ----------------------------------- ------------ ------------ ------------ ------------
Wells Fargo Bank, N.A. M.A. Hanna Company Stock Fund 77 $2,225,834 67 $932,100
Collective Investment Funds
-----------------------------------
Wells Fargo Bank, N.A. Three Way Asset Allocation Fund 46 917,809 25 1,942,408
Wells Fargo Bank, N.A. S&P 500 Stock Fund 47 501,163 19 3,700,557
Wells Fargo Bank, N.A. U.S. Treasury Allocation Fund 29 831,180 38 12,108,398
Wells Fargo Bank, N.A. Money Market Fund 34 1,174,363 26 3,765,072
Mutual Funds
-----------------------------------
Wells Fargo Bank, N.A. Asset Allocation Fund 38 2,768,015 28 559,564
Wells Fargo Bank, N.A. S&P 500 Stock Fund 34 5,024,282 25 1,405,495
Wells Fargo Bank, N.A. U.S. Treasury Allocation Fund 32 14,044,232 37 1,973,960
Wells Fargo Bank, N.A. Money Market Fund 34 5,241,831 33 1,332,295
Single Transactions
Identity of Party Involved Description Date Amount Date Cost
- - ----------------------------------------- ----------------------------------- ------------ ------------ ------------ ------------
Collective Investment Funds
-----------------------------------
Wells Fargo Bank, N.A. Three Way Asset Allocation Fund 7/2/93 $1,800,563
Wells Fargo Bank, N.A. S&P 500 Stock Fund 7/2/93 3,571,334
Wells Fargo Bank, N.A. U.S. Treasury Allocation Fund 7/2/93 11,098,243
Wells Fargo Bank, N.A. Money Market Fund 7/2/93 2,752,259
Mutual Funds
-----------------------------------
Wells Fargo Bank, N.A. Asset Allocation Fund 7/2/93 $1,991,438
Wells Fargo Bank, N.A. Money Market Fund 7/2/93 2,753,247
Wells Fargo Bank, N.A. S&P 500 Stock Fund 7/2/93 3,910,831
Wells Fargo Bank, N.A. U.S. Treasury Allocation Fund 7/2/93 13,164,018
Series of Transactions
-------------------------
Selling
Identity of Party Involved Description Price Net Gain
- - ----------------------------------------- ----------------------------------- ------------ ------------
Wells Fargo Bank, N.A. M.A. Hanna Company Stock Fund $1,241,024 $308,924
Collective Investment Funds
-----------------------------------
Wells Fargo Bank, N.A. Three Way Asset Allocation Fund 2,138,113 195,705
Wells Fargo Bank, N.A. S&P 500 Stock Fund 4,049,821 349,264
Wells Fargo Bank, N.A. U.S. Treasury Allocation Fund 14,299,250 2,190,852
Wells Fargo Bank, N.A. Money Market Fund 3,765,072 0
Mutual Funds
-----------------------------------
Wells Fargo Bank, N.A. Asset Allocation Fund 574,261 14,697
Wells Fargo Bank, N.A. S&P 500 Stock Fund 1,453,177 47,682
Wells Fargo Bank, N.A. U.S. Treasury Allocation Fund 2,028,430 54,470
Wells Fargo Bank, N.A. Money Market Fund 1,332,295 0
Single Transactions
Selling
Identity of Party Involved Description Price Net Gain
- - ----------------------------------------- ----------------------------------- ------------ ------------
Collective Investment Funds
-----------------------------------
Wells Fargo Bank, N.A. Three Way Asset Allocation Fund $1,984,325 $183,762
Wells Fargo Bank, N.A. S&P 500 Stock Fund 3,909,125 337,791
Wells Fargo Bank, N.A. U.S. Treasury Allocation Fund 13,163,673 2,065,430
Wells Fargo Bank, N.A. Money Market Fund 2,752,259 0
Mutual Funds
-----------------------------------
Wells Fargo Bank, N.A. Asset Allocation Fund
Wells Fargo Bank, N.A. Money Market Fund
Wells Fargo Bank, N.A. S&P 500 Stock Fund
Wells Fargo Bank, N.A. U.S. Treasury Allocation Fund