1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
ANNUAL REPORT
PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the fiscal year ended: June 30, 2003
---------------------------------------------
Commission file number: 1-13988
------------------------------------------------
DeVry Inc. Profit Sharing Retirement Plan
- -----------------------------------------------------------------------
A. Full title of the plan:
DeVRY INC.
ONE TOWER LANE, SUITE 1000
OAKBROOK TERRACE, ILLINOIS 60181
- -----------------------------------------------------------------------
B. Name of issuer of the securities held pursuant to the plan and
address of its principal executive office:
REQUIRED INFORMATION
The Plan's audited financial statements and other required information
are attached on the following pages.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
following administrator of the DeVry Inc. Profit Sharing Retirement Plan
has duly caused this annual report to be signed on its behalf by the
undersigned hereunto duly authorized.
DeVry Inc. Profit Sharing Retirement Plan
-----------------------------------------
(Name of Plan)
Date: December 19, 2003 By: /s/MARILYNN J. CASON
---------------------------------
Marilynn J. Cason - Administrator
Total Number of Pages 14
2
DEVRY INC.
PROFIT SHARING RETIREMENT PLAN
REPORT ON AUDITED FINANCIAL STATEMENTS
AND SUPPLEMENTAL SCHEDULE
YEARS ENDED JUNE 30, 2003 AND 2002
3
DEVRY INC.
PROFIT SHARING RETIREMENT PLAN
------------------------------
TABLE OF CONTENTS
-----------------
Pages
-----
Independent Auditors' Report 1-2
Financial Statements:
Statements of Net Assets Available for Benefits 3
Statements of Changes in Net Assets Available
for Benefits 4
Notes to Financial Statements 5-10
Supplemental Schedule:
Schedule of Assets Held for Investment Purposes 11
4
Independent Auditors' Report
To the Participants and Administrator of
The DeVry Inc. Profit Sharing Retirement Plan
We have audited the accompanying statements of net assets
available for benefits of DeVry Inc. Profit Sharing Retirement
Plan (the Plan) as of June 30, 2003 and 2002 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 auditing standards
generally accepted in the United States of America. 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 DeVry Inc. Profit Sharing Retirement
Plan as of June 30, 2003 and 2002 and the changes in its net
assets available for benefits for the years then ended in
conformity with accounting principles generally accepted in
the United States of America.
Our audits were performed for the purpose of forming an
opinion on the financial statements taken as a whole. The
supplemental schedule of assets held for investment purposes
at June 30, 2003 is presented for the purpose of additional
analysis and is not a required part of the basic financial
statements, but are supplementary information required by the
Department of Labor's Rules and Regulations for Reporting and
Disclosure under the Employee Retirement Income Security Act
of 1974. The supplemental schedule is the responsibility of
the Plan's management. The supplemental schedule has been
subjected to the auditing
5
procedures applied in the audits of the basic financial
statements and, in our opinion, is fairly stated in all
material respects in relation to the basic financial
statements taken as a whole.
/s/ Hill, Taylor LLC
October 31, 2003
6
DEVRY INC.
PROFIT SHARING RETIREMENT PLAN
------------------------------
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
-----------------------------------------------
JUNE 30, 2003 AND 2002
----------------------
2003 2002
Assets ----------- -----------
------
Investments, at market value $ 153,103,637 $ 140,587,223
Receivables:
Accrued investment income 5,637 7,222
Employee 401(k) contributions 452,380 419,855
Company contributions 4,645,036 4,443,190
----------- -----------
5,103,053 4,870,267
----------- -----------
Net Assets Available for Benefits $ 158,206,690 $ 145,457,490
=========== ===========
The accompanying notes are an integral part of these financial statements.
7
DEVRY INC.
PROFIT SHARING RETIREMENT PLAN
------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
AVAILABLE FOR BENEFITS
----------------------
YEARS ENDED JUNE 30, 2003 AND 2002
----------------------------------
2003 2002
----------- ------------
Additions:
Additions to net assets attributed to:
Employee 401(k) contributions $ 10,697,429 $ 9,835,210
Employer 401(k) matching contributions 2,402,142 2,219,710
Company discretionary contributions 4,545,587 4,348,394
Assets transferred from other plans 401,485 457,083
Interest and dividends on invested funds 2,937,533 3,000,888
Realized and unrealized gains
on invested funds 8,757,120 2,172,945
----------- -----------
Total additions 29,741,296 22,034,230
----------- -----------
Deductions:
Deductions from net assets attributed to:
Investment and administrative expenses 114,296 120,939
Distributions to employees 8,300,076 4,475,126
Realized and unrealized losses
on invested funds 8,577,724 25,009,057
----------- -----------
Total deductions 16,992,096 29,605,122
----------- -----------
Net increase (decrease) 12,749,200 (7,570,892)
Net assets available for benefits:
Beginning of year 145,457,490 153,028,382
----------- -----------
End of year $ 158,206,690 $ 145,457,490
=========== ===========
The accompanying notes are an integral part of these financial statements.
8
DEVRY INC.
PROFIT SHARING RETIREMENT PLAN
------------------------------
NOTES TO FINANCIAL STATEMENTS
-----------------------------
YEARS ENDED JUNE 30, 2003 AND 2002
----------------------------------
1. General Description of the Plan:
-------------------------------
The following brief description of the DeVry Inc. Profit
Sharing Retirement Plan (the Plan) is provided for general
information purposes only. Participants should refer to
the Plan document for a more complete description of the
Plan's provisions.
The Plan, as amended, is a participant-directed defined
contribution plan with elective employee participation on
a before-tax basis under Section 401(k) of the Internal
Revenue Code and is subject to the Employee Retirement
Income Security Act of 1974 (ERISA). The Plan covers all
United States of America employees of DeVry Inc. (the
Company), and its subsidiaries, eligible on the date of
hire to make employee contributions. Participants are
eligible for the Company's matching contributions and
profit sharing contributions after completing one year of
service with 1,000 or more hours worked. New employees who
were participants in other qualified retirement plans are
permitted to transfer their vested account balances to the
Plan. The Plan covered 4,187 and 3,679 of the Company's
employees at June 30, 2003 and 2002, respectively. This
includes 1,147 and 987 former employees for whom benefits
had not yet been distributed as of June 30, 2003 and 2002,
respectively. The Plan was last amended to be effective as
of January 1, 2002, to reflect the adoption of certain
provisions of the Economic Growth and Tax Relief
Reconciliation Act of 2001.
The Company is the administrator of the Plan. Effective
July 1, 2000, the Company engaged American Express
Retirement Services as trustee of the Plan to perform
certain administrative and record keeping services.
Pursuant to the Plan, eligible employees may elect to
contribute from 1-15% of their annual eligible
compensation on a before-tax basis as limited by the
Internal Revenue Code. Highly compensated employees of the
Company, as defined by the Internal Revenue Code, are
limited to contributing a maximum of 10% of their
compensation. In accordance with the Internal Revenue
Code, eligible employees could contribute a maximum of
$12,000 and $11,000 during calendar years 2003 and 2002,
respectively.
The Company makes a matching contribution for all
participants who have elected to make 401(k)
contributions. This matching contribution is equal to 1%
of gross pay if a participant contributes 1% of his or her
eligible compensation. The matching contribution is 2% if
a participant contributes 2% or more of his or her
eligible
9
1. General Description of the Plan (Continued):
-------------------------------------------
compensation. The Company may also make a discretionary
contribution in an amount determined annually by its board
of directors.
Participants in the Plan may elect each month to invest
their contributions and previous account balances in 1%
increments in any of the funds described below. However,
investments in the DeVry Inc. Stock Fund may be made only
with current period contributions and are limited to 25%
of these contributions. Prior account balances may not be
allocated to this fund.
U.S. Government Securities Fund II - Invests in direct
U.S. Government obligations including Treasury bills and
other short-term securities backed by the full faith and
credit of the U.S. Government. The assets are managed by
American Express Trust Company as part of the American
Express Trust U.S. Government Securities Fund II.
Income Fund - Invests in commercial mortgages and
privately placed and publicly traded fixed income
securities, including corporate bonds, asset-backed
securities and residential mortgage bonds. The assets are
invested in the CIGNA Income Fund.
Diversified Bond Fund - Invests in high-quality, highly
liquid fixed income securities. The Fund may invest in
investment grade fixed-income securities, including U.S.
Government (and agency) securities, corporate bonds,
mortgage-related securities, and asset backed securities.
The assets are invested in the American Express
Diversified Bond Fund (Class Y).
Balanced Fund - Invests in a broadly diversified portfolio
of high yielding securities including common stocks,
preferred stocks, convertible securities and bonds.
Emphasis is placed principally on current income with
capital growth a secondary consideration. The assets are
invested in the AIM Balanced Fund (Class A).
Equity Index Fund - Invests in a portfolio consisting of
common stocks of the S&P 500 Index, an unmanaged index.
The assets are managed by American Express Trust Company
as part of the American Express Trust Equity Index Fund I.
Income and Growth Fund - Invests primarily in common
stocks selected from a universe of the 1,500 largest
companies traded in the United States. The assets are
invested in the American Century Income & Growth Fund
(Advisor Class).
Growth Fund - Invests in a portfolio of companies with
significant growth potential due to superiority in
technology, marketing, or management. Stocks of these
companies may be subject to more price volatility than the
stock market as a whole. The assets are invested in the
American Express New Dimensions Fund (Class Y).
10
1. General Description of the Plan (Continued):
-------------------------------------------
Large Cap Core Fund - Typically owns between 90 and 120
different stocks diversified across industry sectors
similar to the S&P 500 Index. The assets are invested in
the Bank of America Large Cap Core Equity Fund.
International Fund - Invests in common stocks of issuers
outside the United States with expected high growth rates,
financial strength, a high current valuation, management
expertise and innovation. The assets are invested in the
Janus Overseas Fund.
Emerging Growth Fund - Invests in common stocks of small
or medium-sized companies. Stocks of these companies may
be subject to abrupt or erratic price movements. Some of
these companies may also have fewer financial resources.
The assets are managed by American Express Trust Company
as part of the American Express Trust Emerging Growth Fund
II.
DeVry Inc. Stock Fund - Invests only in the common stock,
$0.01 par value, of the Company. The assets are managed by
the Plan's trustee, American Express Trust Company.
The number of participants in each of the Plan's funds was
as follows:
June 30
----------------
2003 2002
------ ------
U.S. Government Securities Fund II 2,100 1,520
Income Fund 1,901 1,214
Diversified Bond Fund 840 660
Balanced Fund 1,186 1,182
Equity Index Fund 540 454
Income and Growth Fund 452 387
Growth Fund 523 458
Large Cap Core Fund 1,602 1,674
International Fund 569 527
Emerging Growth Fund 1,492 1,510
DeVry Inc. Stock Fund 1,526 1,569
Participants are fully vested in their 401(k)
contributions and related investment earnings or losses.
Participants vest in the Company's matching and
discretionary contributions and related investment
earnings and losses based upon the following vesting
schedule:
11
1. General Description of the Plan (Continued):
-------------------------------------------
Years of Service Vesting %
---------------- ---------
1 20%
2 40%
3 60%
4 80%
5 100%
Participant contributions and the Company's contribution
for its 1% or 2% match of compensation of participants who
make 401(k) contributions on a before-tax basis are
allocated after each payroll to participants' accounts.
The Company's discretionary contribution, if any, is
allocated to participants' accounts following the end of
the plan year for which the contribution is declared. As
of June 30, 2003, the discretionary contribution of
$4,545,396 for the plan year 2003 has not yet been
allocated to participants' accounts. Interest, dividends
and investment gains or losses are allocated to
participants' accounts daily. Allocations are based upon
participants' earnings, seniority or account balances as
defined in the Plan. Forfeitures of the unvested or
unclaimed portions of former participants' balances are
annually allocated to the accounts of the remaining
participants.
Former employees may elect to receive a lump sum
distribution or, under certain circumstances, to maintain
their vested account balances in the Plan but they are not
eligible to receive any future Company matching or
discretionary contributions.
Active participants may, under certain circumstances,
withdraw a portion of their 401(k) account balance. These
withdrawals may be in the form of loans, which are to be
repaid with interest over a period not to exceed five
years (ten years under certain limited circumstances).
Participants may borrow from their accounts a minimum of
$1,000 up to a maximum equal to the lesser of $50,000 or
50% of their account balance, whichever is less. The
interest rate is based on the prime rate plus 1%. Loans
are repaid through payroll deductions. Permanent
withdrawals of contributions, but not earnings, may also
be made if the Internal Revenue Service (IRS) defined
hardship conditions are met. A permanent withdrawal is
treated as a taxable distribution to the participant. Upon
retirement or after age 59 1/2, participants may elect a lump
sum distribution or one of several annuity payment plans.
The Company anticipates that the Plan will continue
without interruption but reserves the right to terminate
or freeze the Plan at any time. In the event the Plan is
terminated or frozen, all amounts not yet allocated to the
participants' accounts will be allocated in accordance
with the provisions of the Plan. The resultant
participants' accounts then become fully vested. If the
Plan is terminated, the assets in the Plan will be
completely distributed. If the Plan is frozen, the assets
of the Plan will be retained in the Plan for distribution
at such time and in such a manner as the Plan provides.
12
2. Summary of Significant Accounting Policies:
------------------------------------------
(a) Basis of Accounting
-------------------
The financial statements of the Plan are prepared on
the accrual basis of accounting.
(b) Use of Estimates
----------------
The preparation of financial statements in conformity
with accounting principles generally accepted in the
United States of America requires management to make
estimates and assumptions that affect certain reported
amounts and disclosures. Accordingly, actual results
may differ from those estimates.
(c) Risk and Uncertainties
----------------------
The Plan provides for various investment options in
several mutual funds. Investing in mutual funds
presents various risks, such as interest rate and
market volatility. Due to the level of risk associated
with certain investment options and the level of
uncertainty related to changes in the value of
investment securities, it is possible that changes in
risks in the near term would materially affect
participants' account balances and the amounts reported
in the statements of net asset available for benefits
and the statements of changes in net assets available
for benefits.
(d) Contributions
-------------
Contributions from participants are recorded in the
period payroll deductions are made. The Company's
401(k) matching contributions are recorded in the same
period as the participant contributions are made. The
Company's discretionary contribution, if any, is
recorded in the period for which the contribution is
declared.
(e) Valuation and Income Recognition
--------------------------------
The Plan's investments are stated at fair value. Quoted
market prices are used to value investments. Shares of
mutual funds and collective investment trusts are
valued at the net asset value of shares or units held
by the plan at year end. Participant loans receivable
are stated at cost, which approximates fair market
value.
Purchases and sales of securities are recorded on a
trade-date basis. Dividends are recorded on the ex-
dividend date.
(f) Expenses
--------
Investment expenses incurred by the manager of the
funds and directly related
13
2. Summary of Significant Accounting Policies (Continued):
------------------------------------------------------
administrative expenses are deducted from the earnings
of the Plan. Other administrative expenses are paid by
the Company.
3. Investments:
The following presents investments (all are participant-
directed) that represent 5 percent or more of the Plan's
net assets.
June 30
----------------------------
2003 2002
------------ -----------
U.S. Government Securities Fund II
(7,805,074.070 units at
June 30, 2003) $ 7,805,074 $ -
CIGNA Income Fund (3,618,843.219
and 3,349,370.393 units at
June 30, 2003 and 2002,
respectively) 42,926,718 37,774,199
AIM Balanced Fund (Class A)
(398,289.428 and 362,421.715
units at June 30, 2003
and 2002, respectively) 8,830,077 8,223,349
Bank of America Large Cap Core Fund
(5,973,605.029 and
6,004,304.760 units
at June 30, 2003 and 2002,
respectively) 39,748,368 40,144,782
American Express Trust Emerging
Growth Fund II (1,158,160.553 and
1,087,253.813 units at
June 30, 2003 and 2002,
respectively) 18,392,748 17,543,928
DeVry Inc. Common Stock
(2,172,154.892 and 2,107,341.729
units at June 30, 2003 and 2002,
respectively) 15,409,267 14,633,381
All other investments 19,991,385 22,267,584
------------ ------------
$ 153,103,637 $ 140,587,223
============ ============
4. Tax Status:
----------
The Plan has received a favorable determination letter
from the Internal Revenue Service dated April 20, 1995.
Furthermore, the Company believes the Plan has been
administered in accordance with Internal Revenue Code
requirements and is therefore exempt from federal income
taxes.
14
Supplemental Schedule
15
DEVRY INC.
PROFIT SHARING RETIREMENT PLAN
------------------------------
FORM 5500, SCHEDULE H, PART IV, LINE 4(i)
-----------------------------------------
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
-----------------------------------------------
AT JUNE 30, 2003
----------------
(a) (b) (c) (d) (e)
Identity of issue, borrower,
Lessor, or similar party Description of Investments Cost Current Value
---------------------------- -------------------------- ---- -------------
* American Express Trust U.S.Government Securities
Fund II (7,805,074.070 units) $ 7,805,074 $ 7,805,074
Connecticut General Life CIGNA Income Fund
Insurance Company (3,618,843.219 units) 37,919,358 42,926,718
* American Express Trust AXP Diversified Bond Fund
(Class Y) (1,377,332.504 units) 6,611,122 6,804,023
AIM Advisors, Inc. AIM Balanced Fund (Class A)
(398,289.428 units) 11,153,125 8,830,077
* American Express Trust American Express Trust Equity
Index Fund I (104,634.927 units) 3,111,662 3,066,954
American Century American Century Income &
Growth Fund (Advisor Class)
(78,008.451 units) 1,959,456 1,884,684
* American Express Trust AXP New Dimensions Fund
(Class Y) (126,452.890 units) 2,847,797 2,714,943
Bank of America Large Cap Core Fund
(5,973,605.029 units) 55,089,065 39,748,368
Janus Capital Corporation Janus Overseas Fund
(122,955.787 units) 2,334,016 2,000,491
* American Express Trust American Express Trust
Emerging Growth Fund II
(1,158,160.553 units) 23,725,832 18,392,748
* American Express Trust, DeVry Stock Fund
Trustee (2,172,154.892 units) 20,205,960 15,409,267
* American Express Trust, Participant Loans (Interest
Trustee rates of 5.25% to 10.50%) - 3,494,220
* American Express Trust Cash 26,070 26,070
------------ -----------
$172,788,537 $153,103,637
*Indicates party-in-interest. =========== ===========