EXHIBIT 99
----------
Ary, Earman and Roepcke
Certified Public Accountants
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
----------------------------------------
To the Plan Administrator of The Limited,
Inc. Savings and Retirement Plan:
We have audited the accompanying statements of net assets available for
benefits of The Limited, Inc. Savings and Retirement Plan (the "Plan") as of
December 31, 1998 and 1997, 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 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 benefits of the
Plan as of December 31, 1998 and 1997, and the changes in net assets available
for benefits for each of the years then ended, in conformity with generally
accepted accounting principles.
Our audits were conducted for the purpose of forming an opinion on the
basic financial statements taken as a whole. The supplemental schedules of
assets held for investment purposes at December 31, 1998 and reportable
transactions in excess of 5% of the current value of plan assets for the year
ended December 31, 1998, are presented for the purpose of additional analysis
and are 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 schedules have been subjected to the
auditing procedures applied in the audits of the basic financial statements and,
in our opinion, are fairly stated in all material respects in relation to the
basic financial statements taken as a whole.
/s/ Ary, Earman and Roepcke
Columbus, Ohio,
February 16, 1999.
2929 Kenny Road, Suite 280, Columbus, Ohio 43221
(614) 459-3868 FAX (614) 459-0219
THE LIMITED, INC. SAVINGS AND RETIREMENT PLAN
---------------------------------------------
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
----------------------------------------------
DECEMBER 31, 1998
-----------------
Limited Fixed Index-500
TOTAL Stock Fund Income Fund Fund
------------ ------------ ------------ -----------
ASSETS
- ------
Investments, at Fair Value:
At Quoted Market Price:
Common Stock:
The Limited, Inc. $ 70,799,467 $70,799,467 $ - $ -
Intimate Brands, Inc. 5,876,681 - - -
Abercrombie & Fitch Co 5,721,765 - - -
Mutual Funds:
Vanguard Retirement
Savings Trust Fund 89,083,764 - 89,083,764 -
Vanguard Index Trust
500 Portfolio 98,041,511 - - 98,041,511
Vanguard U.S. Growth
Portfolio 86,327,108 - - -
Vanguard Wellington
Fund 24,530,446 - - -
At Estimated Value:
Common Collective Trust 101,414 357 100,307 -
------------ ----------- ----------- ------------
Total Investments 380,482,156 70,799,824 89,184,071 98,041,511
Contribution Receivable
from Employers 25,548,732 1,590,209 10,942,273 5,475,740
Receivable from Employers
for Withheld Participants'
Contributions 1,906,944 117,898 448,468 565,248
Due from Brokers 197,476 149,399 - -
Interfund Transfers - 11,546 (52,641) 14,808
Accrued Interest and Dividends 4,286 580 1,627 1,007
------------ ----------- ----------- ------------
Total Assets 408,139,594 72,669,456 100,523,798 104,098,314
------------ ----------- ----------- ------------
LIABILITIES
- -----------
Administrative Fees Payable 86,807 24,554 9,463 8,650
Due to Brokers 673 345 - -
------------ ----------- ----------- ------------
Total Liabilities 87,480 24,899 9,463 8,650
------------ ----------- ----------- ------------
NET ASSETS AVAILABLE FOR
BENEFITS $408,052,114 $72,644,557 $100,514,335 $104,089,664
============ =========== ============ ============
Intimate Abercrombie
U.S. Growth Wellington Brands & Fitch Co.
Fund Fund Stock Fund Stock Fund
------------ ----------- ----------- ------------
ASSETS
- ------
Investments, at Fair Value:
At Quoted Market Price:
Common Stock:
The Limited, Inc. $ - $ - $ - $ -
Intimate Brands, Inc. - - 5,876,681 -
Abercrombie & Fitch Co - - - 5,721,765
Mutual Funds:
Vanguard Retirement
Savings Trust Fund - - - -
Vanguard Index Trust
500 Portfolio - - - -
Vanguard U.S. Growth
Portfolio 86,327,108 - - -
Vanguard Wellington
Fund - 24,530,446 - -
At Estimated Value:
Common Collective Trust - - 345 405
----------- ----------- ---------- -----------
Total Investments 86,327,108 24,530,446 5,877,026 5,722,170
Contribution Receivable
from Employers 4,604,275 2,153,489 782,746 -
Receivable from Employers
for Withheld Participants'
Contributions 465,463 230,949 78,918 -
Due from Brokers - - 45,530 2,547
Interfund Transfers 24,857 18,149 (12,825 (3,894)
Accrued Interest and Dividends 639 289 136 8
----------- ----------- ---------- -----------
Total Assets 91,422,342 26,933,322 6,771,531 5,720,831
----------- ----------- ---------- -----------
LIABILITIES
- -----------
Administrative Fees Payable 44,140 - - -
Due to Brokers - - 328 -
----------- ----------- ---------- -----------
Total Liabilities 44,140 - 328 -
----------- ----------- ---------- -----------
NET ASSETS AVAILABLE FOR
BENEFITS $91,378,202 $26,933,322 $ 6,771,203 $ 5,720,831
=========== =========== =========== ===========
The accompanying notes are an integral part of this financial statement.
F-1
THE LIMITED, INC. SAVINGS AND RETIREMENT PLAN
---------------------------------------------
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
----------------------------------------------
DECEMBER 31, 1997
-----------------
Limited Fixed Index-500
TOTAL Stock Fund Income Fund Fund
------------ ----------- ----------- -----------
ASSETS
- ------
Investments, at Fair Value:
At Quoted Market Price:
Common Stock:
The Limited, Inc. $ 68,513,782 $68,513,782 $ - $ -
Intimate Brands, Inc. 3,027,342 - - -
Mutual Funds:
Vanguard Investment Contract Trust 88,164,291 - 88,164,291 -
Vanguard Index Trust - 500
Portfolio 75,764,074 - - 75,764,074
Vanguard U.S. Growth Portfolio 62,996,962 - - -
Vanguard Wellington Fund 19,115,007 - - -
At Estimated Value:
Common Collective Trust 308 241 - -
------------ ----------- ----------- -----------
Total Investments 317,581,766 68,514,023 88,164,291 75,764,074
Contribution Receivable from Employers 22,644,974 1,372,671 10,275,136 4,632,422
Receivable from Employers for Withheld
Participants' Contributions 1,395,711 91,947 391,319 391,168
Due from Brokers 1,655,464 1,543,543 - -
Interfund Transfers - 858,585 (35,679) 3,698
Cash 417,865 - 368,110 49,755
Accrued Interest and Dividends 4,297 693 1,410 1,086
Other 2,470 - 2,470 -
------------ ----------- ----------- -----------
Total Assets 343,702,547 72,381,462 99,167,057 80,842,203
------------ ----------- ----------- -----------
LIABILITIES
- -----------
Cash Overdraft 418,897 - - -
Administrative Fees Payable 218,952 85,121 - -
------------ ----------- ----------- -----------
Total Liabilities 637,849 85,121 - -
------------ ----------- ----------- -----------
NET ASSETS AVAILABLE FOR BENEFITS $343,064,698 $72,296,341 $99,167,057 $80,842,203
============ =========== =========== ===========
Intimate
U.S. Growth Wellington Brands
Fund Fund Stock Fund
----------- ----------- -----------
ASSETS
- ------
Investments, at Fair Value:
At Quoted Market Price:
Common Stock:
The Limited, Inc. $ - $ - $ -
Intimate Brands, Inc. - - 3,027,342
Mutual Funds:
Vanguard Investment Contract Trust - - -
Vanguard Index Trust - 500
Portfolio - - -
Vanguard U.S. Growth Portfolio 62,996,962 - -
Vanguard Wellington Fund - 19,115,007 -
At Estimated Value:
Common Collective Trust - - 67
----------- ----------- -----------
Total Investments 62,996,962 19,115,007 3,027,409
Contribution Receivable from Employers 3,993,277 1,928,218 443,250
Receivable from Employers for Withheld
Participants' Contributions 333,773 156,157 31,347
Due from Brokers - - 111,921
Interfund Transfers (2,722) (828,447) 4,565
Cash - - -
Accrued Interest and Dividends 769 166 173
Other - - -
----------- ----------- -----------
Total Assets 67,322,059 20,371,101 3,618,665
----------- ----------- -----------
LIABILITIES
- -----------
Cash Overdraft 36,843 382,054 -
Administrative Fees Payable 127,701 5,551 579
----------- ----------- -----------
Total Liabilities 164,544 387,605 579
----------- ----------- -----------
NET ASSETS AVAILABLE FOR BENEFITS $67,157,515 $19,983,496 $ 3,618,086
=========== =========== ===========
The accompanying notes are an integral part of this financial statement.
F-2
THE LIMITED, INC. SAVINGS AND RETIREMENT PLAN
---------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
---------------------------------------------------------
FOR THE YEAR ENDED DECEMBER 31, 1998
------------------------------------
Limited Fixed Index-500
Total Stock Fund Income Fund Fund
------------ ------------ ------------- -------------
Investment Income:
Net Appreciation
(Depreciation)in Fair
Value of Investments $ 56,085,295 $ 9,237,871 $ - $ 20,820,362
Mutual Funds' Earnings 15,139,419 - 5,452,457 1,523,923
Dividends 1,415,407 1,319,274 - -
Common Collective Trust's
Earnings 69,440 10,386 24,585 15,438
------------ ----------- ------------ ------------
Total Investment Income 72,709,561 10,567,531 5,477,042 22,359,723
------------ ----------- ------------ ------------
Contributions:
Employers 36,425,460 2,274,483 14,169,692 8,450,499
Participants 20,557,157 1,264,604 4,992,762 6,073,286
------------ ----------- ------------ ------------
Total Contributions 56,982,617 3,539,087 19,162,454 14,523,785
------------ ----------- ------------ ------------
Interfund Transfers - (5,047,007) (5,085,523) 3,791,862
------------ ----------- ------------ ------------
Administrative Expense (869,548) (148,065) (267,737) (257,344)
------------ ----------- ------------ ------------
Benefits to Participants (56,754,614) (7,279,308) (16,403,488) (15,588,092)
------------ ----------- ------------ ------------
Increase in Net Assets
Available for Benefits 72,068,016 1,632,238 2,882,748 24,829,934
Transfer of Net Assets
Available for Benefits to (7,080,600) (1,284,022) (1,535,470) (1,582,473)
Plan of Former Affiliate
Beginning Net Assets 343,064,698 72,296,341 99,167,057 80,842,203
Available for Benefits ------------ ----------- ------------ ------------
Ending Net Assets Available
for Benefits $408,052,114 $72,644,557 $100,514,335 $104,089,664
============ =========== ============ ============
Intimate Abercrombie
U.S. Growth Wellington Brands & Fitch Co.
Fund Fund Stock Fund Stock Fund
----------- ----------- ----------- -----------
Investment Income:
Net Appreciation
(Depreciation)in Fair
Value of Investments $ 19,999,819 $ (203,371) $ 1,010,617 $ 5,219,997
Mutual Funds' Earnings 5,429,608 2,733,431 - -
Dividends - - 96,133 -
Common Collective Trust's
Earnings 12,896 3,906 2,034 195
------------ ----------- ----------- -----------
Total Investment Income 25,442,323 2,533,966 1,108,784 5,220,192
------------ ----------- ----------- -----------
Contributions:
Employers 6,998,828 3,390,948 1,141,010 -
Participants 5,131,046 2,416,210 679,249 -
------------ ----------- ----------- -----------
Total Contributions 12,129,874 5,807,158 1,820,259 -
------------ ----------- ----------- -----------
Interfund Transfers 1,245,394 2,857,829 662,969 1,574,476
------------ ----------- ----------- -----------
Administrative Expense (122,370) (59,709) (11,360) (2,963)
------------ ----------- ----------- -----------
Benefits to Participants (12,559,377) (3,865,228) (370,431) (688,690)
------------ ----------- ----------- -----------
Increase in Net Assets
Available for Benefits 26,135,844 7,274,016 3,210,221 6,103,015
Transfer of Net Assets
Available for Benefits to (1,915,157) (324,190) (57,104) (382,184)
Plan of Former Affiliate
Beginning Net Assets 67,157,515 19,983,496 3,618,086 -
Available for Benefits ------------ ----------- ----------- -----------
Ending Net Assets Available
for Benefits $ 91,378,202 $26,933,322 $ 6,771,203 $ 5,720,831
============ =========== =========== ===========
The accompanying notes are an integral part of this financial statement.
F-3
THE LIMITED, INC. SAVINGS AND RETIREMENT PLAN
---------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
---------------------------------------------------------
FOR THE YEAR ENDED DECEMBER 31, 1997
------------------------------------
Limited Fixed Index-500
Total Stock Fund Income Fund Fund
------------ ------------ ----------- -----------
Investment Income:
Net Appreciation in Fair Value of
Investments $ 50,588,081 $20,451,530 $ - $17,411,774
Mutual Funds' Earnings 10,793,675 - 5,245,293 1,569,334
Dividends 1,474,398 1,422,393 - -
Common Collective Trust's Earnings 88,904 10,449 41,272 18,262
------------ ----------- ----------- -----------
Total Investment Income 62,945,058 21,884,372 5,286,565 18,999,370
------------ ----------- ----------- -----------
Contributions:
Employers 32,697,039 1,963,696 15,507,190 6,371,651
Participants 18,024,880 1,322,245 5,226,156 4,897,686
------------ ----------- ----------- -----------
Total Contributions 50,721,919 3,285,941 20,733,346 11,269,337
------------ ----------- ----------- -----------
Interfund Transfers - (6,914,328) (1,840,989) 3,344,531
------------ ----------- ----------- -----------
Administrative Expense (892,874) (204,971) (261,763) (203,185)
------------ ----------- ----------- -----------
Benefits to Participants (45,591,634) (9,049,583) (14,699,472) (11,143,418)
------------ ----------- ----------- -----------
Increase in Net Assets Available
for Benefits 67,182,469 9,001,431 9,217,687 22,266,635
Beginning Net Assets Available
for Benefits 275,882,229 63,294,910 89,949,370 58,575,568
------------ ----------- ----------- -----------
Ending Net Assets Available
for Benefits $343,064,698 $72,296,341 $99,167,057 $80,842,203
============ =========== =========== ===========
Intimate
U.S. Growth Wellington Brands
Fund Fund Stock Fund
------------ ----------- -----------
Investment Income:
Net Appreciation in Fair Value of
Investments $10,457,321 $ 1,631,686 $ 635,770
Mutual Funds' Earnings 2,443,033 1,536,015 -
Dividends - - 52,005
Common Collective Trust's Earnings 14,531 2,544 1,846
----------- ----------- -----------
Total Investment Income 12,914,885 3,170,245 689,621
----------- ----------- -----------
Contributions:
Employers 5,370,568 2,879,631 604,303
Participants 4,290,800 1,963,375 324,618
----------- ----------- -----------
Total Contributions 9,661,368 4,843,006 928,921
----------- ----------- -----------
Interfund Transfers 2,288,479 1,827,162 1,295,145
----------- ----------- -----------
Administrative Expense (174,289) (42,505) (6,161)
----------- ----------- -----------
Benefits to Participants (8,344,965) (2,030,715) (323,481)
----------- ----------- -----------
Increase in Net Assets Available
for Benefits 16,345,478 7,767,193 2,584,045
Beginning Net Assets Available
for Benefits 50,812,037 12,216,303 1,034,041
----------- ----------- -----------
Ending Net Assets Available
for Benefits $67,157,515 $19,983,496 $ 3,618,086
=========== =========== ===========
The accompanying notes are an integral part of this financial statement.
F-4
THE LIMITED, INC. SAVINGS AND RETIREMENT PLAN
---------------------------------------------
NOTES TO FINANCIAL STATEMENTS
-----------------------------
(1) DESCRIPTION OF THE PLAN
-----------------------
General
-------
The Limited, Inc. Savings and Retirement Plan (the "Plan") is a defined
contribution plan covering certain employees of The Limited, Inc.
and its affiliates (the "Employers") who are at least 21 years of
age and have completed 1,000 or more hours of service during their
first consecutive twelve months of employment or any calendar year
beginning in or after their first consecutive twelve months of
employment. Certain employees of the Employers, who are covered by
a collective bargaining agreement, are not eligible to participate
in the Plan.
Effective January 1, 1997, the Plan allowed for the associates of
Galyan's Trading Company, Inc. who met the eligibility
requirements of the Plan, to participate in the Plan for purposes
of electing voluntary tax-deferred contributions only. Effective
February 1, 1998, associates of Galyan's electing to participate
are eligible to receive allocations of Employers' contributions as
noted below.
Effective October 1, 1997, the Plan's enrollment dates were changed
from quarterly to monthly.
The Limited, Inc. owned 84.2% of the outstanding Common Stock of
Abercrombie & Fitch Co. until the completion of a tax-free
exchange offer (the "Exchange Offer") on May 19, 1998,
establishing Abercrombie & Fitch Co. as an independent company
and, as a result, Abercrombie & Fitch Co.'s associates are no
longer participants in the Plan. Subsequent to the Exchange Offer,
the net assets available for benefits allocated to the former
participants employed by Abercrombie & Fitch Co. were transferred
to the Abercrombie & Fitch Savings and Retirement Plan.
The Abercrombie & Fitch Co. Stock Fund was established due to the
Exchange Offer. No additional contributions may be made to this
fund.
The following description of the Plan provides only general
information. Participants should refer to the Plan document for a
more complete description of the Plan's provisions. The Plan is
subject to the provisions of the Employee Retirement Income
Security Act of 1974 (ERISA) as amended.
Contributions
-------------
Employer Contributions:
The Employers may provide a non-service related retirement contribution
of 4% of annual compensation up to the Social Security wage base
and 7% of annual compensation thereafter, and a service related
retirement contribution of 1% of annual compensation for
participants who have completed five or more years of vesting
service as of the last day of the Plan year. Participants who
complete 500 hours of service during the Plan year and are
participants on the last day of the Plan year are eligible. The
annual compensation of each participant taken into account under
the Plan is limited to the maximum amount permitted under Section
401(a)(17) of the Internal Revenue Code. The annual compensation
limit for the Plan year ended December 31, 1998, was $160,000.
The Employers may also provide a matching contribution of 100% of the
participant's voluntary contributions (50% for participants who
are associates of Galyan's) up to 3% of the participant's total
annual compensation.
F-5
Participant Voluntary Contributions:
A participant may elect to make a voluntary tax-deferred contribution of 1% to
6% of his or her annual compensation up to the maximum permitted under
Section 402(g) of the Internal Revenue Code adjusted annually ($10,000 at
December 31, 1998). This voluntary tax-deferred contribution may be limited
by Section 401(k) of the Internal Revenue Code.
Vesting
- -------
A participant is fully and immediately vested for voluntary and rollover
contributions and is credited with a year of vesting service in the
Employers' contributions for each Plan year that they are credited with at
least 500 hours of service. A summary of vesting percentages in the
Employers' contributions follows:
Years of Vested Service Percentage
----------------------- ----------
Less than 3 years 0%
3 years 20
4 years 40
5 years 60
6 years 80
7 years 100
Payment Of Benefits
- -------------------
The full value of participants' accounts becomes payable upon retirement,
disability, or death. Upon termination of employment for any other reason
participants' accounts, to the extent vested, become payable. Those
participants with vested account balances greater than $5,000 have the option
of leaving their accounts invested in the Plan until age 65. All benefits
will be paid as a lump-sum distribution. Those participants holding shares of
Employer Securities will have the option of receiving such amounts in whole
shares of Employer Securities and cash for any fractional shares.
Participants have the option of having their benefit paid directly to an
eligible retirement plan specified by the participant.
A participant who is fully vested in his or her account and who has participated
in the Plan for at least seven years may obtain an in-service withdrawal from
their account based on the percentage amounts designated by the Plan. A
participant may also request a hardship distribution due to an immediate and
heavy financial need based on the terms of the Plan.
Amounts Allocated to Participants Withdrawn from the Plan
- ---------------------------------------------------------
The vested portion of net assets available for benefits allocated to
participants withdrawn from the plan as of December 31, 1998 and 1997, is set
forth below:
1998 1997
---------- ----------
Limited Stock Fund $ 210,766 $ 377,704
Fixed Income Fund 611,899 645,142
Index-500 Fund 778,834 489,489
U.S. Growth Fund 605,616 409,316
Wellington Fund 159,863 128,102
Intimate Brands Stock Fund 15,785 12,002
Abercrombie & Fitch Co. Stock
Fund 6,692 -
---------- ----------
$2,389,455 $2,061,755
========== ==========
F-6
Forfeitures
-----------
Forfeitures are used to reduce the Employers' required contributions.
Utilized forfeitures for 1998 and 1997, are set forth below:
1998 1997
---------- ----------
Limited Stock Fund $ 172,668 $ 345,937
Fixed Income Fund 3,135,785 2,715,821
Index-500 Fund 1,292,792 1,240,275
U.S. Growth Fund 1,021,924 1,028,955
Wellington Fund 443,714 269,006
Intimate Brands Stock Fund 59,013 9,983
---------- ----------
$6,125,896 $5,609,977
========== ==========
Expenses
--------
Brokerage fees, transfer taxes, and other expenses incurred in
connection with the investment of the Plan's assets will be added
to the cost of such investments or deducted from the proceeds
thereof, as the case may be. Administrative expenses of the Plan
will be paid from the Plan from earnings not allocated to
participants' accounts. The remainder will be paid by the
Employers, unless the Employers elect to pay more or all of such
costs.
Tax Determination
-----------------
The Plan obtained its latest determination letter on January 30, 1995,
in which the Internal Revenue Service stated that the Plan, as
amended and restated January 1, 1992 was in compliance with the
applicable requirements of the Internal Revenue Code. The Plan has
been amended since receiving the determination letter. However,
the Plan administrator and the Plan's tax counsel believe that the
Plan is designed and is currently being operated in compliance
with the applicable requirements of the Internal Revenue Code.
Accordingly, the following Federal income tax rules will apply to
the Plan:
Voluntary tax-deferred contributions made under the Plan by a
participant and contributions made by the Employers to
participant accounts are generally not taxable until such
amounts are distributed.
The participants are not subject to Federal income tax on
interest, dividends, or gains in their particular accounts
until distributed.
The foregoing is only a brief summary of certain tax implications and
applies only to Federal tax regulations currently in effect.
(2) SUMMARY OF ACCOUNTING POLICIES
------------------------------
Basis of Accounting
-------------------
The Plan's financial statements are prepared on the accrual basis of
accounting. Assets of the Plan are valued at fair value. The
preparation of the financial statements in conformity with
generally accepted accounting principles requires the Plan's
management to use estimates and assumptions that affect the
accompanying financial statements and disclosures. Actual results
could differ from these estimates.
Income Recognition
------------------
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.
F-7
Investment Valuation
--------------------
Mutual funds are stated at fair value as determined by quoted market
prices, which represents the net asset value of shares held by the
Plan at year end. Common stock is valued as determined by quoted
market price. The common collective trust, a money fund, uses an
estimated value of one dollar per share.
Net Appreciation (Depreciation) in Fair Value of Investments
------------------------------------------------------------
Net realized and unrealized appreciation (depreciation) is recorded in the
accompanying statement of changes in net assets available for benefits
as net appreciation (depreciation) in fair value of investments.
Benefit Payments
----------------
Benefits are recorded when paid.
Reclassification of Prior Year Information
------------------------------------------
Certain prior year information has been reclassified to conform with
current year presentation.
(3) INVESTMENTS
-----------
The Plan's investments are held by The Chase Manhattan Bank, as trustee of
the Plan. The following table presents balances for 1998 and 1997 for
the Plan's current investment options. Investments that represent 5
percent or more of the Plan's net assets are separately identified.
1998 1997
------------ ------------
Investments at Fair Value as Determined by
Quoted Market Price:
Common Stock:
The Limited, Inc. $ 70,799,467 $ 68,513,782
Other 11,598,446 3,027,342
Mutual Funds:
Vanguard Retirement Savings Trust Fund 89,083,764 -
Vanguard Investment Contract Trust - 88,164,291
Vanguard Index Trust - 500 Portfolio 98,041,511 75,764,074
Vanguard U.S. Growth Portfolio 86,327,108 62,996,962
Vanguard Wellington Fund 24,530,446 19,115,007
------------ ------------
380,380,742 317,581,458
Estimated Fair Value:
Common Collective Trust 101,414 308
------------ ------------
Total Investments at Fair Value $380,482,156 $317,581,766
============ ============
The Plan's investments (including investments bought, sold, and held
during the year) appreciation in value for the years ended
December 31, 1998 and 1997, is set forth below:
1998 1997
------------ ------------
Investments at Fair Value as Determined
By Quoted Market Price:
Mutual Funds $ 40,616,810 $ 29,500,781
Common Stock 15,468,485 21,087,300
------------ ------------
Net Appreciation in Fair Value $ 56,085,295 $ 50,588,081
============ ============
F-8
Contributions under the Plan are invested in one of six investment funds:
(1) The Limited Stock Fund, consisting of common stock of The Limited,
Inc., a Delaware corporation (the "Issuer") and parent company of the
Employers, (2) the Fixed Income Fund, which is invested in the
Vanguard Retirement Savings Trust Fund which was exchanged for the
prior investment in the Vanguard Investment Contract Trust, (3) the
Index-500 Fund, which is invested in the Vanguard Index - 500
Portfolio, (4) the U.S. Growth Fund, which is invested in the Vanguard
U.S. Growth Portfolio, (5) the Wellington Fund, which is invested in
the Vanguard Wellington Fund, and (6) the Intimate Brands Stock Fund,
consisting of common stock of Intimate Brands, Inc., a Delaware
corporation and an 84.5% owned subsidiary of The Limited, Inc.
Participants' voluntary and Employers' contributions may be invested in any
one or more of the funds, at the election of the participant.
Participants' may make or change an investment direction as of the first
day of any month of the Plan year.
(4) PLAN ADMINISTRATION
-------------------
The Plan is administered by a Committee, the members of which are appointed
by the Board of Directors of the Employers.
(5) PLAN TERMINATION
----------------
Although the Employers have not expressed any intent to do so, the
Employers have the right under the Plan to discontinue their
contributions at any time. The Limited, Inc. has the right at any
time, by action of its Board of Directors, to terminate the Plan
subject to provisions of ERISA. Upon Plan termination or partial
termination, participants will become fully vested in their accounts.
(6) RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500
---------------------------------------------------
The following is a reconciliation of net assets available for benefits per
the financial statements to Form 5500:
1998 1997
------------ ------------
Net Assets Available for Benefits
Per the Financial Statements $408,052,114 $343,064,698
Amounts Allocated to Withdrawing
Participants (2,389,455) (2,061,755)
------------ ------------
Net Assets Available for Benefits
Per Form 5500 $405,662,659 $341,002,943
============ ============
The following is a reconciliation of benefits paid to participants per
the financial statements to Form 5500:
Benefits Paid to Participants Per the Financial
Statements $ 56,754,614
Amounts Allocated to Withdrawing Participants:
At December 31, 1998 2,389,455
At December 31, 1997 (2,061,755)
------------
Benefits Paid to Participants Per Form 5500 $ 57,082,314
============
Amounts allocated to withdrawing participants are recorded on Form 5500 for
benefit claims that have been processed and approved for payment prior
to December 31 but not yet paid as of that date.
F-9
SCHEDULE I
THE LIMITED, INC. SAVINGS AND RETIREMENT PLAN
---------------------------------------------
EIN #31-1048997 PLAN #002
-------------------------
ITEM 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
----------------------------------------------------------
DECEMBER 31, 1998
-----------------
Description of Investment Including Maturity
Identity of Issue, Borrower, Date, Rate of Interest, Collateral, Par or Current
Lessor, or Similar Party Maturity Value Cost Value
- ------ ------------------------------ ----------------------------------------------- ------------ ------------
* The Limited, Inc. 2,430,883 Shares of Common Stock, Par Value $ 31,110,330 $ 70,799,467
$0.50
* Intimate Brands, Inc. 196,709 Shares of Common Stock, Class A 4,491,448 5,876,681
Abercrombie & Fitch Co. 80,873 Shares of Common Stock, Class A, Par 1,215,436 5,721,765
Value $0.01
The Vanguard Group 89,083,764 Shares of Vanguard Retirement 89,083,764 89,083,764
Savings Trust Fund
The Vanguard Group 860,391 Shares of Vanguard Index 500 58,699,848 98,041,511
Portfolio Fund
The Vanguard Group 2,302,670 Shares of Vanguard World Fund, U.S. 56,970,077 86,327,108
Growth Portfolio
The Vanguard Group 835,790 Shares of Vanguard Wellington Fund 23,749,124 24,530,446
* Chase Manhattan Bank 101,414 Shares of Chase Manhattan Bank Enhanced 101,414 101,414
Cash Investment Fund, a Common/Collective Trust,
7 Day Net annualized Yield on 12/31/98 of 5.48%
* Represents a party in interest
The accompanying notes are an integral part of this schedule.
F-10
SCHEDULE II
THE LIMITED, INC. SAVINGS AND RETIREMENT PLAN
---------------------------------------------
EIN #31-1048997 PLAN #002
-------------------------
ITEM 27d - SCHEDULE OF REPORTABLE TRANSACTIONS
----------------------------------------------
FOR THE YEAR ENDED DECEMBER 31, 1998
------------------------------------
Current
Expense Value of
Identity Incurred Asset on
of Party Purchase Selling Lease With Cost Transaction Net Gain
Involved Description of Asset Price Price Rental Transaction of Asset Date or (Loss)
- -------------- -------------------- ------------ ------------ --------- ----------- ----------- ----------- ----------
$ 8,020,702
* The Limited, The Limited, Inc. $ 8,020,702 $ - $ - $ 4,321,938 10,453,868 $6,131,930
Inc. Common Stock $10,453,868
- 15,475,462
The Vanguard Vanguard Investment 15,475,462 - - 103,639,753 103,639,753 -
Group Contract Trust 103,639,753
- 109,329,808
The Vanguard Vanguard Retirement 109,329,808 - - 18,721,596 18,721,596 -
Group Savings Trust Fund 18,721,596
- 23,002,542
The Vanguard Vanguard Index 500 23,002,542 - - 12,644,028 20,394,776 7,750,748
Group Portfolio Fund 20,394,776
- 22,654,992
The Vanguard Vanguard World Fund, 22,654,992 - - 10,849,865 21,434,658 10,584,793
Group U.S. Growth Portfolio 21,434,658
The Vanguard Vanguard Wellington 12,792,018 - 12,792,018
Group Fund 8,699,959 - - 6,177,858 8,699,959 2,522,101
* Chase Chase Manhattan Bank 74,644,066 - 74,644,066 -
Manhattan Enhanced Cash 74,542,960 - - 74,542,960 74,542,960
Bank Investment Fund
*Represents a party in interest
The accompanying notes are an integral part of this schedule.
F-11