SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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Form 11-K
ANNUAL REPORT
PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
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(Mark One)
( X ) ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934 for the fiscal year ended December 31, 2002
or
( ) TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 for the transition period from ____________ to _____________
Commission File No. 000-24484
A. Full title and address of the plan, if different from that of the
issuer named below:
MPS GROUP, INC.
RETIREMENT SAVINGS PLAN
ONE INDEPENDENT DRIVE
JACKSONVILLE, FLORIDA 32202
(904) 360-2000
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
MPS GROUP, INC.
ONE INDEPENDENT DRIVE
JACKSONVILLE, FLORIDA 32202
(904) 360-2000
MPS GROUP, INC.
RETIREMENT SAVINGS PLAN
INDEX TO FINANCIAL STATEMENTS
AS OF DECEMBER 31, 2002 AND 2001 AND FOR THE YEAR ENDED DECEMBER 31, 2002
TABLE OF CONTENTS
Report of Independent Certified Public Accountants 1
Financial Statements:
Statements of Net Assets Available for Benefits 2
Statement of Changes in Net Assets Available for Benefits 3
Notes to Financial Statements 4
Supplemental Schedules:*
Schedule of Assets Held for Investment Purposes 7
Signatures 8
Exhibits
Exhibit 99.1 Certification Pursuant to 18 U.S.C. Section 1350, as
Adopted Pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002
* Other schedules required by 29 CFR 2520.103-10 of the Department of Labor's
Rules and Regulations for Reporting and Disclosure under ERISA have been
omitted because they are not applicable.
</Table>
Report of Independent Certified Public Accountants
To the Participants and Administrator
of MPS Group, Inc. Retirement Savings Plan
In our opinion, the accompanying statements of net assets available for benefits
and the related statement of changes in net assets available for benefits
present fairly, in all material respects, the net assets available for benefits
of the MPS Group, Inc. Retirement Savings Plan (the "Plan") at December 31, 2002
and 2001, and the changes in net assets available for benefits for the year
ended December 31, 2002 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.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule of assets held
for investment purposes is presented for the purpose of additional analysis and
is not a required part of the basic financial statements but is 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. This supplemental schedule is the responsibility of the Plan's management.
The supplemental schedule has been subjected to the auditing 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.
PricewaterhouseCoopers LLP
Jacksonville, Florida
June 16, 2003
1
MPS Group, Inc. Retirement Savings Plan
Statements of Net Assets Available for Benefits
As of December 31, 2002 and 2001
2002 2001
Assets
Investments $ 90,257,469 $ 125,313,940
Receivables:
Participant contributions 467,857 806,932
Employer contribution - 232,218
----------------- ----------------
Total receivables 467,857 1,039,150
Net assets available for benefits $ 90,725,326 $ 126,353,090
----------------- ----------------
</Table>
The accompanying notes are an integral part of these financial statements.
2
MPS Group, Inc. Retirement Savings Plan
Statement of Changes in Net Assets Available for Benefits
For the Year Ended December 31, 2002
Additions:
Additions to net assets attributed to:
Investment income:
Interest $ 241,642
----------------
Total investment income 241,642
----------------
Contributions:
Participants 14,332,445
Employer 887,420
----------------
Total contributions 15,219,865
----------------
Total additions 15,461,507
----------------
Deductions:
Deductions from net assets attributed to:
Net depreciation in fair value of investments 21,398,256
Benefits paid to participants 29,797,760
Other 181,076
----------------
Total deductions 51,377,092
----------------
Net increase prior to transfers (35,915,585)
Transfers from merged plans 287,821
----------------
Net decrease (35,627,764)
Net assets available for benefits:
Beginning of year 126,353,090
----------------
End of year $ 90,725,326
----------------
</Table>
The accompanying notes are an integral part of these financial statements.
3
MPS Group, Inc. Retirement Savings Plan
Notes to Financial Statements
December 31, 2002 and 2001
1. Description of Plan
The following description of the MPS Group, Inc. Retirement Savings Plan (the
"Plan") 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 covering professional
employees of MPS Group, Inc. (the "Company") who have completed at least
375 hours of service in any three consecutive month period or one year of
service. To continue to vest in Company contributions, a participant must
work at least 1,000 hours each year. The Plan is subject to the provisions
of the Employee Retirement Income Security Act of 1974 (ERISA).
Contributions - Each year, participants may contribute up to 15% of pretax
annual compensation, as defined in the Plan. Participants may also
contribute amounts representing distributions from other qualified defined
benefit or defined contribution plans. Participants direct the investment
of their contributions into various investment options offered by the Plan.
The Plan currently offers three common/collective trusts, twelve mutual
funds, and the Company stock as investment options for participants. The
Company, at its discretion, contributes a uniform percentage of the amount
of salary elected to be deferred. Contributions are subject to certain
limitations.
Participants Accounts - Each participant's account is credited with the
participant's contribution and allocations of (a) the Company's
contribution and (b) Plan earnings. Allocations are based on participant
earnings or account balances, as defined. The benefit to which a
participant is entitled is the benefit that can be provided from the
participant's vested account.
Vesting - Participants are vested immediately in their contributions plus
actual earnings thereon. Vesting in the Company's contribution portion of
their accounts is based on years of continuous service at 25% per year of
service. A participant is 100 percent vested after four years of credited
service.
In the event of death or total and permanent disability while under the
Company's employment, all amounts credited to the participant's account as
of the subsequent plan anniversary date are considered fully vested.
Participant Loans - Participants may borrow from their fund accounts a
minimum of $1,000 up to a maximum of $50,000 or 50% of their account
balance, whichever is less. The loans are collateralized by the balance in
the participant's account and bear interest at rates that range from 5.75%
to 10.5%, which were commensurate with local prevailing rates at the time
of issuance as determined quarterly by the Plan administrator.
Payment of Benefits - On termination of service due to death, disability,
or retirement, a participant or participant's beneficiary will receive a
lump sum amount equal to the value of the participant's vested interest in
his or her account. For termination of service for other reasons, a
participant may receive the value of the vested interest in his or her
account as a lump-sum distribution.
Forfeiture Allocation - At December 31, 2002, forfeited nonvested accounts
totaled approximately $1,498,573. These accounts will be used to reduce
employer contributions.
4
2. Summary of Significant Accounting Policies
Basis of Accounting - The financial statements of the Plan are prepared
under the accrual method of accounting.
Use of Estimates - The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
significant 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.
Investment Valuation and Income Recognition - The Plan's investments are
stated at fair value based upon quoted market prices.
The Plan presents in the statement of changes in net assets available for
benefits the net depreciation in fair value of its investments which
consists of the realized gains or losses and the unrealized gains and
losses on these investments.
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.
Risks and Uncertainties - The Plan provides for various investment options
in any combination of fixed income securities and mutual funds. Investment
securities are exposed to various risks, such as interest rate, market and
credit. Due to the level of risk associated with certain investment
securities and the level of uncertainty related to changes in the value of
investment securities, it is at least reasonably possible that changes in
risks in the near term would materially affect participants' account
balances and the amounts reported in the statement of net assets available
for plan benefits and the statement of changes in net assets available for
plan benefits.
Benefits - Benefits are recorded when paid.
3. Investments
The following presents investments that represent 5% or more of the Plan's
assets.
2002 2001
--------------- --------------
Strong Money Market $ - $ 14,624,684
Strong Mutual Funds pooled accounts:
Government Securities - 13,455,207
Advisor Common - 19,271,899
Growth - 23,157,909
Growth and Income - 11,186,130
Index 500 - 17,039,619
MultiCap Value - 9,048,841
Common/Collective Trusts
Merrill Lynch Equity Index Trust I 10,398,306 -
Merrill Lynch Retirement Preservation Trust 14,893,187 -
Mutual Funds
Van Kampen Growth & Income Fund 7,759,329 -
Merrill Lynch Mid Cap Value Fund 8,443,350 -
Federated Kaufman Fund 11,699,845 -
Calvert Income Fund 13,951,333 -
Merrill Lynch Fundamental Growth Fund 14,110,733 -
During 2002, the Plan's investments (including gains and losses on
investments bought and sold, as well as held during the year) depreciated
in value by $21,398,256 as follows:
Mutual funds $ 19,959,471
MPS stock 1,330,393
Common/collective trusts 108,392
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$ 21,398,256
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</Table>
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4. Plan Termination
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 will become 100% vested in their employer
contributions.
5. Tax Status
The Internal Revenue Service has determined and informed the Company by
letter dated August 30, 2002 that the Plan and related trust are designed
in accordance with applicable sections of the Internal Revenue Code (IRC).
6. Financial Instruments
Certain financial instruments potentially subject the Plan to
concentrations of credit risk. These financial instruments consist of money
market funds and pooled accounts with a mutual fund company.
The Plan limits its credit risk by maintaining its accounts with what it
believes to be high quality financial institutions.
7. Related Party Transactions
Certain Plan investments are shares of mutual funds, MPS Stock, and
common/collective trusts managed by Merrill Lynch Retirement Services.
Merrill Lynch is the trustee as defined by the Plan and, therefore, these
transactions qualify as party-in-interest transactions.
Employees can elect to allocate their contributions to the purchase of
MPS stock.
8. Merger of Subsidiary Plans
During 2002, the Plan was amended to include the defined contribution plans
of two subsidiaries. The following table details the subsidiary, merger
date and amounts of assets transferred into the MPS plan.
Subsidiary Date Amount
- -------------------------------------------------------- -------------------------------- -----------------
Preferred Consulting Services, Inc. Employee
401(k) Profit Sharing Plan July 2002 $ 199,574
Millard, Inc. 401(k) Plan August 2002 88,247
-----------------
$ 287,821
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The assets for the plans of Preferred Consulting Services, Inc. and
Millard, Inc, are included in investments in the statement of net assets
available for benefits as of December 31, 2002 and the changes in those
assets, from the date of merger to December 31, 2002 are included in the
statement of changes in net assets available for benefits for the year
ended December 31, 2002.
6
Supplemental Schedules
MPS Group, Inc. Retirement Savings Plan
Schedule of Assets Held for Investment Purposes at End of Year
As of December 31, 2002
Identity of issue, Description of investment including
borrower, lessor or maturity date, rate of interest, Current
similar party collateral, par or maturity value Value
- ------------------------------------------------- ------------------------------------------ -----------------
Cash Cash $ 60,816
* MPS Stock Common Stock 1,609,759
* Merrill Lynch Equity Index Trust I Common/Collective Trust 10,398,306
* Merrill Lynch Retirement Preservation Trust Common/Collective Trust 14,893,187
Davis NY Venture Fund Mutual Fund 296,977
Oakmark Equity & Income Fund Mutual Fund 37,192
Federated Kaufman Fund Mutual Fund 11,699,845
* Merrill Lynch US Government Mortgage Fund Mutual Fund 1,325,209
* Merrill Lynch Fundamental Growth Fund Mutual Fund 14,110,733
* Merrill Lynch Mid Cap Value Fund Mutual Fund 8,443,350
AIM Small Cap Growth Fund Mutual Fund 327,673
Seligman Communications & Information Fund Mutual Fund 9,982
Calvert Income Fund Mutual Fund 13,951,333
Templeton Foreign Fund Mutual Fund 3,780,046
Van Kampen Growth & Income Fund Mutual Fund 7,759,329
* Merrill Lynch Small Cap Value Fund Mutual Fund 180,415
* Participant Notes Receivable with interest
rates ranging from 5.75% to 10.5% Loans 1,373,317
---------------
$ 90,257,469
---------------
* Party-in-interest as defined by ERISA
</Table>
7
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.
MPS GROUP, INC.
As Plan Administrator of the MPS Group, Inc.
Retirement Savings Plan
/s/ Robert P. Crouch
--------------------
Robert P. Crouch
Senior Vice President,
Chief Financial Officer,
Treasurer & Chief Accounting Officer
June 30, 2003
8