Exhibit No. 99(b)
FORM 11-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended September 30, 1996
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OR
[_] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
-------------------- -----------------------
Commission file number 1-2116
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RETIREMENT SAVINGS PLAN FOR SALARIED EMPLOYEES
OF ARMSTRONG WORLD INDUSTRIES, INC.
(Full title of the Plan)
ARMSTRONG WORLD INDUSTRIES, INC.
Liberty and Charlotte Streets
Lancaster, Pennsylvania 17604
(Name of issuer of the securities held pursuant to
the Plan and the address of its principal executive office)
Page No.
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Item 1. Statements of Net Assets 4
------------------------
September 30, 1996 and 1995
Item 2. Statements of Changes in Plan Equity 5-7
------------------------------------
(a) Year ended September 30, 1996
(b) Year ended September 30, 1995
(c) Year ended September 30, 1994
Notes to Financial Statements 8-12
- -----------------------------
Item 3. Independent Auditors' Report 13
----------------------------
Exhibits
- --------
24. Consent of Independent Auditors
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
members of the committee constituting the administrator which administers the
plan have duly caused this annual report to be signed by the undersigned
hereunto duly authorized.
RETIREMENT SAVINGS PLAN FOR SALARIED
EMPLOYEES OF ARMSTRONG WORLD INDUSTRIES, INC.
March 25, 1997 By: /s/ E. Allen Deaver
------------------------------------------
E. Allen Deaver
Chairman of the Retirement Committee
RETIREMENT SAVINGS PLAN FOR SALARIED EMPLOYEES
OF ARMSTRONG WORLD INDUSTRIES, INC.
Statements of Net Assets
September 30, 1996 and 1995
1996
Commingled Specialized Money Fixed Income Armstrong "OTC"
Equity Fund Equity Fund Market Fund Fund Stock Fund Portfolio Fd.
------------ ------------ ------------ ------------ ------------ ------------
Assets:
Investments in master trust
at fair value (note 3) $ 34,640,234 $ 55,239,099 $ 3,050,434 $126,067,031 $ 13,508,146 $ 6,856,784
------------ ------------ ------------ ------------ ------------ ------------
Total assets $ 34,640,234 $ 55,239,099 $ 3,050,434 $126,067,031 $ 13,508,146 $ 6,856,784
------------ ------------ ------------ ------------ ------------ ------------
Plan equity $ 34,640,234 $ 55,239,099 $ 3,050,434 $126,067,031 $ 13,508,146 $ 6,856,784
============ ============ ============ ============ ============ ============
Asset Asset Mgr. Asset Mgr. Loan
Manager Fund Income Fund Growth Fund Portfolio Fund Total
------------ ------------ ------------ ------------ ------------
Assets:
Investments in master trust
at fair value (note 3) $ 4,441,622 $ 2,013,481 $ 6,417,103 $ 3,307,686 $255,541,620
------------ ------------ ------------ ------------ ------------
Total assets $ 4,441,622 $ 2,013,481 $ 6,417,103 $ 3,307,686 $255,541,620
------------ ------------ ------------ ------------ ------------
Plan equity $ 4,441,622 $ 2,013,481 $ 6,417,103 $ 3,307,686 $255,541,620
============ ============ ============ ============ ============
1995
Commingled Specialized Money Fixed Income Armstrong "OTC"
Equity Fund Equity Fund Market Fund Fund Stock Fund Portfolio Fd.
------------ ------------ ------------ ------------ ------------ ------------
Assets:
Investments in master trust
at fair value (note 3) $ 26,008,895 $ 53,822,126 $ 2,863,787 $119,173,404 $ 9,957,012 $ 3,998,454
------------ ------------ ------------ ------------ ------------ ------------
Total assets $ 26,008,895 $ 53,822,126 $ 2,863,787 $119,173,404 $ 9,957,012 $ 3,998,454
------------ ------------ ------------ ------------ ------------ ------------
Plan equity $ 26,008,895 $ 53,822,126 $ 2,863,787 $119,173,404 $ 9,957,012 $ 3,998,454
============ ============ ============ ============ ============ ============
1995
Asset Asset Mgr. Asset Mgr. Loan
Manager Fund Income Fund Growth Fund Portfolio Fund Total
------------ ------------ ------------ ------------ ------------
Assets:
Investments in master trust
at fair value (note 3) $ 4,171,934 $ 1,465,384 $ 5,380,158 $ 3,408,962 $230,250,116
------------ ------------ ------------ ------------ ------------
Total assets $ 4,171,934 $ 1,465,384 $ 5,380,158 $ 3,408,962 $230,250,116
------------ ------------ ------------ ------------ ------------
Plan equity $ 4,171,934 $ 1,465,384 $ 5,380,158 $ 3,408,962 $230,250,116
============ ============ ============ ============ ============
See accompanying notes to financial statements
RETIREMENT SAVINGS PLAN FOR SALARIED EMPLOYEES
OF ARMSTRONG WORLD INDUSTRIES, INC.
Statements of Changes in Plan Equity
Years Ended September 30, 1996, 1995 and 1994
1996
Commingled Specialized Money Fixed Income Armstrong "OTC"
Equity Fund Equity Fund Market Fund Fund Stock Fund Portfolio Fd.
----------- ----------- ----------- ---- ---------- -------------
Plan equity at October 1, 1995 $26,008,895 $53,822,126 $2,863,787 $119,173,404 $9,957,012 $3,998,454
----------- ----------- ---------- ------------ ---------- ----------
Increases in plan equity:
Contributions 1,304,166 3,271,882 3,249,141 3,759,748 263,346 592,828
Dividends 824,216 10,899,654 150,409 -- 274,227 676,518
Interest 30,962 73,870 5,326 7,376,774 9,598 9,354
Realized gain on investments
(note 3) 1,356,135 1,682,172 -- -- 598,743 173,665
Transfers (to) from other
employee benefit plans (note 2) 917,764 (486,370) (2,722,959) 5,740,701 2,510,969 54,286
Loan activity, net (127,242) 9,945 (51,300) 199,025 30,537 30,924
----------- ----------- ---------- ------------ ---------- ----------
4,306,001 15,451,153 630,617 17,076,248 3,687,420 1,537,575
----------- ----------- ---------- ------------ ---------- ----------
Decreases in plan equity:
Unrealized appreciation
(depreciation) of investments 3,201,122 (10,982,140) -- -- 733,682 49,322
Benefits paid (note 4) (1,417,320) (2,135,340) (305,283) (7,011,691) (569,160) (178,186)
Interfund transfers, net 2,541,536 (916,700) (138,687) (3,170,930) (300,808) 1,449,619
----------- ----------- ---------- ------------ ---------- ----------
4,325,338 (14,034,180) (443,970) (10,182,621) (136,286) 1,320,755
----------- ----------- ---------- ------------ ---------- ----------
Plan equity at September 30,1996 $34,640,234 $55,239,099 $3,050,434 $126,067,031 $13,508,146 $6,856,784
=========== =========== ========== ============ =========== ==========
Asset Asset Mgr. Asset Mgr. Loan
Manager Fund Income Fund Growth Fund Portfolio Fund Total
------------ ----------- ----------- -------------- -----
Plan equity at October 1, 1995 $4,171,934 $1,465,384 $5,380,158 $3,408,962 $230,250,116
---------- ---------- ---------- ---------- ------------
Increases in plan equity:
Contributions 294,053 69,892 517,010 -- 13,322,066
Dividends 149,553 92,269 77,215 -- 13,144,061
Interest 6,424 3,161 8,596 -- 7,524,065
Realized gain on investments
(note 3) 84,274 17,013 141,202 -- 4,053,204
Transfers (to) from other
employee benefit plans (note 2) 41,971 256,953 (272,357) (21,076) 6,019,882
Loan activity, net (4,895) 11,757 (18,551) (80,200) --
---------- ---------- ---------- ---------- ------------
571,380 451,045 453,115 (101,276) 44,063,278
---------- ---------- ---------- ---------- ------------
Decreases in plan equity:
Unrealized appreciation
(depreciation) of investments 188,800 11,409 457,253 -- (6,340,552)
Benefits paid (note 4) (464,192) (170,707) (179,343) -- (12,431,222)
Interfund transfers, net (26,300) 256,350 305,920 -- --
---------- ---------- ---------- ---------- ------------
(301,692) 97,052 583,830 -- (18,771,774)
---------- ---------- ---------- ---------- ------------
Plan equity at September 30,1996 $4,441,622 $2,013,481 $6,417,103 $3,307,686 $255,541,620
========== ========== ========== ========== ============
See accompanying notes to financial statements (Continued)
RETIREMENT SAVINGS PLAN FOR SALARIED EMPLOYEES
OF ARMSTRONG WORLD INDUSTRIES, INC.
Statements of Changes in Plan Equity, Continued
1995
Commingled Specialized Money Fixed Income Armstrong "OTC"
Equity Fund Equity Fund Market Fund Fund Stock Fund Portfolio Fd.
----------- ----------- ----------- ---- ---------- -------------
Plan equity at October 1, 1994 $20,074,514 $40,885,939 $2,364,783 $108,691,987 $7,203,780 $2,199,833
----------- ----------- ---------- ------------ ---------- ----------
Increases in plan equity:
Contributions 1,190,525 3,475,590 215,540 4,790,964 295,226 375,257
Dividends 587,101 199,906 138,766 -- 245,705 96,677
Interest 33,291 67,892 8,112 7,591,186 12,946 6,544
Realized gain (loss) on
investments (note 3) 662,728 1,499,516 -- -- 217,271 98,150
Unrealized appreciation of
investments 4,621,828 13,524,954 -- -- 2,038,938 795,420
Transfers (to) from other
employee benefit plans of
Armstrong World Industries, Inc. (9,748) 158,001 6,943 58,530 25,829 41,124
Loan activity, net (222,751) (15,988) (10,923) 40,829 31,056 36,106
----------- ----------- ---------- ------------ ---------- ----------
6,862,974 18,909,871 358,438 12,481,509 2,866,971 1,449,278
----------- ----------- ---------- ------------ ---------- ----------
Decreases in plan equity:
Benefits paid (note 4) (1,149,156) (1,965,434) (121,127) (5,546,200) (207,166) (323,260)
Interfund transfers, net 220,563 (4,008,250) 261,693 3,546,108 93,427 672,603
----------- ----------- ---------- ------------ ---------- ----------
(928,593) (5,973,684) 140,566 (2,000,092) (113,739) 349,343
----------- ----------- ---------- ------------ ---------- ----------
Plan equity at September 30,1995 $26,008,895 $53,822,126 $2,863,787 $119,173,404 $9,957,012 $3,998,454
=========== =========== ========== ============ ========== ==========
Asset Asset Mgr. Asset Mgr. Loan
Manager Fund Income Fund Growth Fund Portfolio Fund Total
------------ ----------- ----------- -------------- -----
Plan equity at October 1, 1994 $3,488,114 $1,766,979 $4,767,677 $3,159,183 $194,602,789
---------- ---------- ---------- ---------- ------------
Increases in plan equity:
Contributions 358,667 101,319 722,517 -- 11,525,605
Dividends 135,937 66,120 131,133 -- 1,601,345
Interest 6,061 1,980 10,696 -- 7,738,708
Realized gain (loss) on
investments (note 3) (41,279) (21,983) (21,443) -- 2,392,960
Unrealized appreciation of
investments 282,885 120,617 400,690 -- 21,785,332
Transfers (to) from other
employee benefit plans of
Armstrong World Industries, Inc. (3,017) -- -- 44,668 322,330
Loan activity, net (29,030) (41,574) 7,164 205,111 -
---------- ---------- ---------- ---------- ------------
710,224 226,479 1,250,757 249,779 45,366,280
---------- ---------- ---------- ---------- ------------
Decreases in plan equity:
Benefits paid (note 4) (100,933) (140,007) (165,670) -- (9,718,953)
Interfund transfers, net 74,529 (388,067) (472,606) -- -
---------- ---------- ---------- ---------- ------------
(26,404) (528,074) (638,276) - (9,718,953)
---------- ---------- ---------- ---------- ------------
Plan equity at September 30,1995 $4,171,934 $1,465,384 $5,380,158 $3,408,962 $230,250,116
========== ========== ========== ========== ============
See accompanying notes to financial statements (Continued)
RETIREMENT SAVINGS PLAN FOR SALARIED EMPLOYEES
OF ARMSTRONG WORLD INDUSTRIES, INC.
Statements of Changes in Plan Equity, Continued
1994
Commingled Specialized Money Fixed Income Armstrong "OTC"
Equity Fund Equity Fund Market Fund Fund Stock Fund Portfolio Fd.
----------- ----------- ----------- ---- ---------- -------------
Plan equity at October 1, 1993 $21,907,057 $38,103,999 $2,664,691 $110,188,428 $7,121,870 $1,601,565
----------- ----------- ---------- ------------ ---------- ----------
Increases in plan equity:
Contributions 1,090,512 3,079,493 152,506 3,385,978 200,709 233,587
Dividends 765,667 3,849,084 81,375 -- 201,625 101,625
Interest 41,595 76,371 12,314 7,807,669 5,530 6,767
Realized gain (loss) on
investments (note 3) 874,833 464,049 -- -- 247,166 (17,970)
Transfers (to) from other
employee benefit plans of
Armstrong World Industries, Inc. 863 9,604 11,437 (19,965) 11,126 4,568
Loan activity, net (21,731) 169,552 9,773 135,007 15,947 52,702
----------- ----------- ---------- ------------ ---------- ----------
2,751,739 7,648,153 267,405 11,308,689 682,103 381,279
----------- ----------- ---------- ------------ ---------- ----------
Decreases in plan equity:
Unrealized appreciation
(depreciation) of investments (931,592) (4,829,281) -- -- 52,533 (86,928)
Benefits paid (note 4) (644,466) (1,497,530) (108,573) (5,927,743) (189,656) (60,685)
Interfund transfers, net (3,008,224) 1,460,598 (458,740) (6,877,387) (463,070) 364,602
----------- ----------- ---------- ------------ ---------- ----------
(4,584,282) (4,866,213) (567,313) (12,805,130) (600,193) 216,989
----------- ----------- ---------- ------------ ---------- ----------
Plan equity at September 30,1994 $20,074,514 $40,885,939 $2,364,783 $108,691,987 $7,203,780 $2,199,833
=========== =========== ========== ============ ========== ==========
Asset Asset Mgr. Asset Mgr. Loan
Manager Fund Income Fund Growth Fund Portfolio Fund Total
------------ ----------- ----------- -------------- -----
Plan equity at October 1, 1993 $297,227 $85,542 $94,578 $3,512,435 $185,577,392
-------- ------- ------- ---------- ------------
Increases in plan equity:
Contributions 266,340 90,079 536,559 -- 9,035,763
Dividends 153,211 89,541 111,463 -- 5,353,591
Interest 6,495 3,131 10,971 -- 7,970,843
Realized gain (loss) on
investments (note 3) (10,039) (23,524) (15,473) -- 1,519,042
Transfers (to) from other
employee benefit plans of
Armstrong World Industries, Inc. -- -- 1,120 (8,145) 10,608
Loan activity, net 4,329 (68,420) 47,948 (345,107) -
--------- --------- --------- ---------- ------------
420,336 90,807 692,588 (353,252) 23,889,847
--------- --------- --------- ---------- ------------
Decreases in plan equity:
Unrealized appreciation
(depreciation) of investments (162,610) (68,890) (82,171) -- (6,108,939)
Benefits paid (note 4) (189,598) (61,703) (75,557) -- (8,755,511)
Interfund transfers, net 3,122,759 1,721,223 4,138,239 -- -
--------- --------- --------- ---------- ------------
2,770,551 1,590,630 3,980,511 - (14,864,450)
--------- --------- --------- ---------- ------------
Plan equity at September 30,1994 $3,488,114 $1,766,979 $4,767,677 $3,159,183 $194,602,789
========== ========== ========== ========== ============
See accompanying notes to financial statements
RETIREMENT SAVINGS PLAN FOR SALARIED EMPLOYEES
OF ARMSTRONG WORLD INDUSTRIES, INC.
Notes to Financial Statements
(1) Summary of Significant Accounting Policies
------------------------------------------
(a) Basis of Presentation
---------------------
The accompanying financial statements have been prepared on the accrual
basis.
(b) Investments in Master Trust
---------------------------
The fair value of the commingled equity, specialized equity,
over-the-counter portfolio, and Asset Manager funds is based on the
underlying market value of the investments. The money market fund is
stated at cost which approximates fair value. The fixed income fund is
comprised of guaranteed interest rate contracts which are fully benefit
responsive, and therefore are reflected at contract value plus credited
interest in the financial statements. The value of the Armstrong stock
fund is based on quoted market price. The value of the loan portfolio
fund represents the unpaid principal of employee loans.
Securities transactions are recognized on the settlement date (the date
on which payment for a buy or sell order is made or received), since
adjustment to a trade-date basis would not be material. Dividend income
is recorded on the ex-dividend date.
Realized gains and losses on investments are determined by the average
cost method.
(c) Expenses
--------
All legal, accounting and administrative expenses associated with Plan
operations are paid by the Company.
(2) Plan Description
----------------
The Plan was established on August 1, 1983, under the name the Savings
Investment Plan for Salaried Employees of Armstrong World Industries, Inc.
On November 30, 1987, the Board of Directors of Armstrong amended the Plan
effective February 1, 1988, to permit investments by participants in an
Armstrong Common Stock Fund and to change its name to the Retirement
Savings Plan for Salaried Employees of Armstrong World Industries, Inc.
The plan is a defined contribution plan established for the purpose of
providing to eligible salaried employees of Armstrong World Industries,
Inc. (the Company) a means for long-term savings intended for the
accumulation of retirement income in addition to that provided under other
retirement plans maintained for the benefit of employees.
Participants may elect to make contributions to the Plan in each of the
following methods:
1. Up to 15% of their before-tax compensation, as deferred compensation as
permitted under Section 401(k) of the Internal Revenue Code.
2. Up to 10% of their after-tax compensation.
Separate accounts are maintained for contributions made by or on behalf of
a participant. The accounts in each fund reflect the participants'
contributions together with dividends, interest, other income, and realized
and unrealized gains and losses allocated thereon.
Participants have an immediate 100 percent vested interest with respect to
their contributions and are fully vested with regard to any previously made
matching company contributions.
RETIREMENT SAVINGS PLAN FOR SALARIED EMPLOYEES
OF ARMSTRONG WORLD INDUSTRIES, INC.
Notes to Financial Statements, (Continued)
Plan participants did include salaried employees of Thomasville Furniture
Industries, Inc. On December 29, 1995, Armstrong World Industries, Inc.,
sold Thomasville Furniture to Interco Incorporated. The agreement of sale
required Interco to establish a savings plan for Thomasville employees
comparable to those it maintains for its other employees. Interco's
successor plan became effective as of April 1, 1996. The salaried
Thomasville participants of the Plan were allowed to make contributions to
the Plan through March 31, 1996, at which time they were given the option
to transfer their account balances to the Interco plan.
The following table presents the transfers made by investment type:
Commingled equity $1,694,425
Specialized equity 4,219,230
Money market 2,944,518
Fixed income 6,658,481
OTC portfolio 455,336
Asset manager 308,114
Asset manager income 136,902
Asset manager growth 601,858
-------------
$17,018,864
=============
(3) Investments in Master Trust
---------------------------
Assets are held in a Master Trust administered by Fidelity Management Trust
Co., as Trustee, and are segregated into nine investment options: a
commingled equity mutual fund (Fidelity U.S. Equity Index Portfolio), a
specialized equity mutual fund (Fidelity Magellan), a money market mutual
fund (Fidelity Return Money Market Portfolio), three Asset Manager mutual
funds, an over-the-counter mutual fund (OTC Portfolio Fund), a fixed income
fund, and an Armstrong stock fund. The Plan utilizes the Trustee and
associated investment managers to direct investment activity. The Plan
participates in all nine investment alternatives.
The following is a description of the investment funds to which Plan
participants can elect to allocate their contributions.
1. Commingled Equity Fund - This fund is principally a portfolio of common
stocks constructed and maintained with the objective of providing
investment results which approximate the overall performance of the common
stocks included in the Standard & Poor's Composite Index of 500 stocks. At
September 30, 1996, there were 1,505 active participants in this investment
fund.
2. Specialized Equity Fund - This fund invests in common stocks of companies
having substantial growth prospects as determined by independent investment
managers. At September 30, 1996, there were 2,235 active participants in
this investment fund.
3. Money Market Fund - This fund invests in short-term (less than one year
maturity) fixed income instruments such as U.S. Treasury Bills, bank
certificates of deposit, and high grade commercial paper. At September 30,
1996, there were 393 active participants in this investment fund.
4. Fixed Income Fund - Contributions to this fund are invested in the general
accounts of insurance companies and are credited at contracted interest
rates. At September 30, 1996, the interest rates ranged between 5.35% and
8.26%. Invested principal and accumulated interest amounts are guaranteed
against loss by the insurance company. At September 30, 1996, there were
3,517 active participants in this investment fund.
5. Armstrong Stock Fund - Amounts invested in this fund, along with dividend
earnings thereon, are invested in Armstrong common stock. At September 30,
1996, there were 2,327 active participants in this investment fund. Common
stock shares held by the fund at September 30, 1996 and 1995 were 216,563
and 179,406, respectively.
6. OTC Portfolio Fund - This fund invests in securities traded in the
over-the-counter securities market with the objective of maximizing capital
appreciation. Over-the-counter securities include common and preferred
stocks, securities convertible into common stock, warrants, and debt
instruments. At September 30, 1996, there were 575 active participants in
this investment fund.
RETIREMENT SAVINGS PLAN FOR SALARIED EMPLOYEES
OF ARMSTRONG WORLD INDUSTRIES, INC.
Notes to Financial Statements, (Continued)
7. Asset Manager Fund - An asset allocation fund which invests in a portfolio
of stocks, bonds, and short-term instruments. The fund has a balanced
investment strategy with a goal of high total return with reduced risk over
the long term. At September 30, 1996, there were 340 active participants in
this investment fund.
8. Asset Manager Income Fund - An asset allocation fund which invests in a
diversified portfolio of stocks, bonds, and short-term instruments. The
fund has a conservative investment strategy focusing on bonds and
short-term instruments to achieve a high level of current income and
capital preservation. At September 30, 1996, there were 114 active
participants in this investment fund.
9. Asset Manager Growth Fund - An asset allocation fund invested in a
diversified mix of stocks, bonds, and short-term instruments. The fund's
investment strategy is an aggressive one emphasizing stocks with the goal
of maximum total return over the long term. At September 30, 1996, there
were 496 active participants in this investment fund.
10. Loan Portfolio Fund - The amount in this fund represents the unpaid
principal balances of loans made by Plan participants in accordance with
established loan provision guidelines. At September 30, 1996, there were
658 loans outstanding.
The following table presents the cost and fair values of the investments in
securities of the Master Trust at September 30, 1996 and 1995:
September 30, 1996 September 30, 1995
------------------ ------------------
Investment Cost Fair Value Cost Fair Value
---------- ---- ---------- ---- ----------
Commingled equity $22,619,668 $34,640,234 $17,189,451 $26,008,895
Specialized equity 49,375,796 55,239,099 36,976,683 53,822,126
Money market 3,050,434 3,050,434 2,863,787 2,863,787
Fixed income 126,067,031 126,067,031 119,173,404 119,173,404
Armstrong stock 9,504,386 13,508,146 6,686,934 9,957,012
OTC portfolio 6,118,457 6,856,784 3,309,449 3,998,454
Asset manager 4,132,342 4,441,622 4,051,454 4,171,934
Asset manager income 1,949,750 2,013,481 1,413,062 1,465,384
Asset manager growth 5,640,506 6,417,103 5,060,814 5,380,158
Loan portfolio 3,307,686 3,307,686 3,408,962 3,408,962
--------- --------- --------- ---------
$231,766,056 $255,541,620 $200,134,000 $230,250,116
============ ============ ============ ============
The amounts of realized gain (loss) on investments in securities of the Master
Trust for the years ended September 30, 1996, 1995, and 1994 are presented
below:
Aggregate Aggregate Realized
1996 Proceeds Cost Gain (Loss)
---- -------- ---- -----------
Commingled equity $2,623,858 $1,267,723 $1,356,135
Specialized equity 7,504,239 5,822,067 1,682,172
Armstrong stock 1,651,243 1,052,500 598,743
OTC portfolio 1,498,007 1,324,342 173,665
Asset manager 1,784,344 1,700,070 84,274
Asset manager income 819,155 802,142 17,013
Asset manager growth 1,598,514 1,457,312 141,202
--------- --------- -------
$17,479,360 $13,426,156 $4,053,204
=========== =========== ==========
RETIREMENT SAVINGS PLAN FOR SALARIED EMPLOYEES
OF ARMSTRONG WORLD INDUSTRIES, INC.
Notes to Financial Statements, (Continued)
Aggregate Aggregate Realized
Proceeds Cost Gain (Loss)
1995 --------- ---- -----------
----
Commingled equity $2,529,266 $1,866,538 $662,728
Specialized equity 8,283,037 6,783,521 1,499,516
Armstrong stock 925,502 708,231 217,271
OTC portfolio 773,079 674,929 98,150
Asset manager 1,252,539 1,293,818 (41,279)
Asset manager income 982,479 1,004,462 (21,983)
Asset manager growth 1,575,135 1,596,578 (21,443)
---------- ----------- ----------
$16,321,037 $13,928,077 $2,392,960
=========== =========== ==========
1994
----
Commingled equity $4,197,432 $3,322,599 $874,833
Specialized equity 4,209,579 3,745,530 464,049
Armstrong stock 827,356 580,190 247,166
OTC portfolio 506,960 524,930 (17,970)
Asset manager 428,433 438,472 (10,039)
Asset manager income 987,917 1,011,441 (23,524)
Asset manager growth 473,242 488,715 (15,473)
---------- ----------- ----------
$11,630,919 $10,111,877 $1,519,042
=========== =========== ==========
(4) Benefits
--------
Under terms of the Plan, a participant (or a beneficiary) is eligible for
benefits upon retirement, termination of employment, or death before
retirement. Disbursement of the total amount credited to a participant's
account is payable (i) in a lump sum or (ii) in the case of retirement, in
such other manner as requested by the participant and approved by the Plan
Administrator. In addition, a participant may elect to withdraw all or any
part of his account attributable to his contributions.
If the amount of a withdrawal exceeds the amount of contributions made by
the participant and not previously withdrawn, the participant shall be
ineligible to make contributions for a specified period, except that a
participant may elect to withdraw all or any portion of his account
attributable to tax deductible contributions.
Under the rules of the Plan, the participant may borrow up to 90 percent of
his account, other than amounts attributable to tax deductible
contributions or amounts invested in the Armstrong Stock Fund, with the
approval of the Plan Administrator. The amount of the loan is transferred
to a Loan Reserve pledged as security for the loan and is evidenced by a
promissory note payable to the Plan. Interest rates are determined
periodically by the Retirement Savings Plan Committee in accordance with
prevailing interest rates. The loans are reflected in the Loan Portfolio
investment fund. Loan repayments are made by payroll deductions or in a
manner agreed to by the employee and the Plan Administrator.
(5) Obligation for Benefits
-----------------------
All the funds of the Plan are held by investing institutions appointed by
the Company under a trust agreement or investment contract. Benefits under
the Plan are payable only out of these funds. The Company has no legal
obligation to make any direct payment of benefits accrued under the Plan.
Except as may be provided in an investment contract, neither the Company
nor any investing institution guarantees the funds of the Plan against any
loss or depreciation or guarantees the payment of any benefit hereunder.
Although the Company has not expressed any intent to terminate the Plan, it
may do so at any time. In case of termination or partial termination, the
total amount in each employee's account will be distributed as the Plan
Administrator directs.
(6) Federal Income Taxes
--------------------
By a letter dated February 13, 1996, the Internal Revenue Service has
determined and informed the Company that the Plan qualifies under the
applicable provisions of the Internal Revenue Code and is therefore exempt
from federal income taxes.
RETIREMENT SAVINGS PLAN FOR SALARIED EMPLOYEES
OF ARMSTRONG WORLD INDUSTRIES, INC.
Notes to Financial Statements, (Continued)
(7) Subsequent Event
----------------
On May 29, 1996, the Company's Board of Directors approved the
restructuring of the Plan and the merger of the Plan with the Armstrong
World Industries, Inc. Employee Stock Ownership Plan. The merged plan was
named the Retirement Savings and Stock Ownership Plan and had an effective
date of October 1, 1996.
Independent Auditors' Report
----------------------------
The Retirement Committee
Armstrong World Industries, Inc.:
We have audited the accompanying statements of net assets of the Retirement
Savings Plan for Salaried Employees of Armstrong World Industries, Inc. as of
September 30, 1996 and 1995 and the related statements of changes in plan equity
for each of the years in the three-year period ended September 30, 1996. 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 financial position of the Retirement Savings Plan for
Salaried Employees of Armstrong World Industries, Inc. as of September 30, 1996
and 1995 and the changes in its plan equity for each of the years in the
three-year period ended September 30, 1996, 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 fund information in the statements of
net assets and the statements of changes in plan equity is presented for
purposes of additional analysis rather than to present the net assets and
changes in plan equity of each fund. The fund information 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.
KPMG PEAT MARWICK LLP
Philadelphia, Pennsylvania
February 28, 1997
EXHIBIT INDEX
24 Consent of Independent Auditors
Consent of Independent Auditors
-------------------------------
The Retirement Committee
Armstrong World Industries, Inc.:
We consent to incorporation by reference in the Registration Statement No.
33-18996 on Form S-8 of Armstrong World Industries, Inc. of our report dated
February 28, 1997, relating to the statements of net assets of the Retirement
Savings Plan for Salaried Employees of Armstrong World Industries, Inc. as of
September 30, 1996 and 1995 and the related statements of changes in plan equity
for each of the years in the three-year period ended September 30, 1996, which
report is included herein.
KPMG PEAT MARWICK LLP
Philadelphia, Pennsylvania
March 24, 1997