11-K 1 d946515d11k.htm FORM 11-K Form 11-K
Table of Contents

 

 

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 11-K

 

 

 

x ANNUAL REPORT PURSUANT TO SECTION l5(d) OF THE SECURITIES EXCHANGE ACT OF l934

For the fiscal year ended December 31, 2014

OR

 

¨ TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                     

Commission file number 0-16350

 

 

 

A. Full title of the plan and address of the plan, if different from that of the issuer named below:

J. Walter Thompson Company Profit Sharing

and Matched Savings Plan

 

B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office:

WPP plc

27 Farm Street

London, United Kingdom, W1J5RJ

 

 

 


Table of Contents

J. WALTER THOMPSON COMPANY PROFIT SHARING

AND MATCHED SAVINGS PLAN

INDEX TO FINANCIAL STATEMENTS

 

 

     Page  

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

     1   

FINANCIAL STATEMENTS:

  

Statements of Net Assets Available for Benefits
December 31, 2014 and 2013

     2   

Statement of Changes in Net Assets Available for Benefits
For the Year Ended December 31, 2014

     3   

Notes to Financial Statements

     4 -12   

SUPPLEMENTAL SCHEDULES: *

  

Form 5500, Schedule H, Part IV, line 4i - Schedule of Assets
(Held at End of Year) - December 31, 2014

     13   

Form 5500, Schedule H, Part IV, line 4a - Schedule of Delinquent Participant
Contributions For the Year Ended December 31, 2014

     14   

 

* All other schedules required by Section 2520.103-10 of the Department of Labor’s Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974 have been omitted because they are not applicable.


Table of Contents

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Participants and Plan Administrator of the

J. Walter Thompson Company Profit Sharing and Matched Savings Plan

We have audited the accompanying statements of net assets available for benefits of the J. Walter Thompson Company Profit Sharing and Matched Savings Plan (the “Plan”) as of December 31, 2014 and 2013, and the related statement of changes in net assets available for benefits for the year ended December 31, 2014. 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 the standards of the Public Company Accounting Oversight Board (United States). 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, 2014 and 2013, and the changes in net assets available for benefits for the year ended December 31, 2014, in conformity with accounting principles generally accepted in the United States of America.

The supplemental information in the accompanying schedules of Form 5500, Schedule H, Part IV, line 4i – Schedule of Assets (Held at End of Year)- December 31, 2014 and Form 5500 Schedule H, Part IV, line 4a – Schedule of Delinquent Participant Contributions For the Year ended December 31, 2014 have been subjected to audit procedures performed in conjunction with the audit of the Plan’s financial statements. The supplemental information is presented for the purpose of additional analysis and is not a required part of the financial statements, but includes supplemental 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 information is the responsibility of the Plan’s management. Our audit procedures included determining whether the supplemental information reconciles to the financial statements or the underlying accounting and other records, as applicable and performing procedures to test the completeness and accuracy of the information presented in the supplemental information. In forming our opinion on the supplemental information in the accompanying schedules, we evaluated whether the supplemental information, including its form and content, is presented in conformity with the Department of Labor’s Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. In our opinion, the supplemental information in the accompanying schedules is fairly stated in all material respects in relation to the financial statements as a whole.

/S/ BENCIVENGA WARD & COMPANY, CPA’S, P.C.

Valhalla, New York

June 29, 2015

 

1


Table of Contents

J. WALTER THOMPSON COMPANY PROFIT SHARING

AND MATCHED SAVINGS PLAN

STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS

DECEMBER 31, 2014 AND 2013

 

 

     2014     2013  

ASSETS

    

Investments, at fair value

   $ 355,582,172      $ 339,764,038   
  

 

 

   

 

 

 

Receivables:

Notes receivable from participants

  4,817,733      4,720,889   

Participating employer contributions

  12,916,545      13,999,464   
  

 

 

   

 

 

 

Total receivables

  17,734,278      18,720,353   
  

 

 

   

 

 

 

Total assets

  373,316,450      358,484,391   
  

 

 

   

 

 

 

LIABILITIES

Return of excess employee contributions

  1,350      —     

Liabilities

  132,908      132,908   
  

 

 

   

 

 

 

Total liabilities

  134,258      132,908   
  

 

 

   

 

 

 

NET ASSETS AVAILABLE FOR BENEFITS, AT FAIR VALUE

  373,182,192      358,351,483   

Adjustment from fair value to contract value for fully benefit-responsive investment contracts

  (598,395   (361,042
  

 

 

   

 

 

 

NET ASSETS AVAILABLE FOR BENEFITS

$ 372,583,797    $ 357,990,441   
  

 

 

   

 

 

 

See accompanying notes to the financial statements.

 

2


Table of Contents

J. WALTER THOMPSON COMPANY PROFIT SHARING

AND MATCHED SAVINGS PLAN

STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS

FOR THE YEAR ENDED DECEMBER 31, 2014

 

 

ADDITIONS:

Net investment income:

Interest and dividends

$ 21,153,532   

Net depreciation in fair value of investments

  (4,935,907
  

 

 

 

Net investment income

  16,217,625   
  

 

 

 

Interest income on notes receivable from participants

  193,415   
  

 

 

 

Contributions:

Participating employers

  12,916,545   

Participants

  17,751,060   

Rollovers

  1,353,677   
  

 

 

 

Total contributions

  32,021,282   
  

 

 

 

Total additions

  48,432,322   
  

 

 

 

DEDUCTIONS:

Benefits paid to participants

  27,806,517   

Net asset transfers out

  5,884,780   

Administrative and investment expenses

  147,669   
  

 

 

 

Total deductions

  33,838,966   
  

 

 

 

INCREASE IN NET ASSETS

  14,593,356   

NET ASSETS AVAILABLE FOR BENEFITS:

Beginning of year

  357,990,441   
  

 

 

 

End of year

$ 372,583,797   
  

 

 

 

See accompanying notes to the financial statements.

 

3


Table of Contents

J. WALTER THOMPSON COMPANY PROFIT SHARING

AND MATCHED SAVINGS PLAN

NOTES TO FINANCIAL STATEMENTS

AS OF DECEMBER 31, 2014 AND 2013 AND FOR THE YEAR ENDED DECEMBER 31, 2014

 

 

1. DESCRIPTION OF THE PLAN

The following description of the J. Walter Thompson Company Profit Sharing and Matched Savings Plan (the “Plan”) provides only general information. Plan participants should refer to the Plan document for a more complete description of the Plan’s provisions.

General

The Plan is a defined contribution plan sponsored by J. Walter Thompson Company LLC (“the Company” or “JWT”), subject to the provisions of the Employee Retirement Income Security Act of 1974 (“ERISA”). Bank of America, N.A. (“BOA”) is the Trustee and Recordkeeper of the Plan.

Contributions/Eligibility

Deferred Contributions

The Matched Savings portion of the Plan is available to all eligible U.S. employees of J. Walter Thompson Company LLC, J. Walter Thompson U.S.A., LLC, TeamDetroit, LLC, JWT Specialized Communications, LLC, TeamDetroit Stat LLC, The Brand Union Company, Inc., WPP Group USA, Inc., Team Garage LLC, Mirum Inc. (formerly Digitaria Interactive, Inc.), Data Alliance, Inc., and Public Relations & International Sport Management (each an indirect wholly-owned subsidiary of WPP plc, each a “Participating Employer” and collectively the “Participating Employers”).

Employees become eligible to participate in the Plan on the first day of the month following their employment commencement date. The Plan includes an auto-enrollment provision whereby all newly eligible employees are automatically enrolled in the Plan unless they affirmatively elect not to participate in the Plan. Automatically enrolled participants have their deferral rate set at 3% of eligible compensation and their contributions invested in a designated fund until changed by the participant.

Participating employees may contribute between 1% and 50% of their eligible compensation in Deferred Contributions (up to the annual federal dollar limit for these contributions) to the Matched Savings portion of the Plan. For Plan years 2014 and 2013, eligible compensation is limited to $260,000 and $255,000, respectively. An eligible employee of a Participating Employer, whether or not a participant in the Plan, may make rollover contributions in accordance with the terms of the Plan.

Matching Contributions

Each Participating Employer determines annually whether a discretionary matching contribution (“Matching Contribution”) will be made. To receive a Matching Contribution, if any, an eligible participant must be employed on December 31 of the relevant Plan year and have completed one year of qualifying service as defined by the Plan.

The Company Matching Contribution is made to the account of each participant in an amount up to one half of the first 6% in Deferred Contributions.

Catch-up Contributions

Participating employees who have attained age 50 may contribute an additional percentage of eligible compensation as catch-up contributions (up to the annual federal dollar limit for these contributions). Catch-up contributions are not eligible for Company Matching Contributions.

 

4


Table of Contents

J. WALTER THOMPSON COMPANY PROFIT SHARING

AND MATCHED SAVINGS PLAN

NOTES TO FINANCIAL STATEMENTS

AS OF DECEMBER 31, 2014 AND 2013 AND FOR THE YEAR ENDED DECEMBER 31, 2014

 

 

1. DESCRIPTION OF THE PLAN - (continued)

 

Profit Sharing Contributions

The Profit Sharing portion of the Plan is available to eligible U.S. employees of the Participating Employers, except the employees of JWT Specialized Communications, Inc. Eligible employees must have completed two years of qualifying service before incurring a one year break in service, as defined by the Plan. Annual discretionary Profit Sharing contributions under the Plan are determined by the relevant Participating Employer and are allocated to each participant employed by the Participating Employer as of December 31 of the relevant Plan year based upon eligible compensation, as defined by the Plan. There are no participant contributions to the Profit Sharing portion of the Plan.

Participant Accounts

Each participant’s account is credited with the participant’s contributions and allocations of (a) any Company contributions and (b) Plan earnings (losses), and is charged with an allocation of administrative expenses that are paid by the Plan. The benefit to which a participant is entitled is the benefit that can be provided from the participant’s vested account balance.

Investments

Participants direct the investment of their contributions into various investment options offered by the Plan. The Plan currently offers a number of mutual funds, a common collective trust, the MRJ Value Equity Fund, and a WPP Stock Fund, which invests in American Depositary Shares of WPP plc (“WPP plc ADSs”).

Vesting

Deferred Contributions, Catch-up Contributions and their related earnings are 100% vested and non-forfeitable. Matching Contributions and related earnings are not vested and are forfeitable upon termination of employment until a participant completes three years of service. Amounts that are forfeited are used to reduce future contributions of the Participating Employers and may be used to pay Plan expenses. Profit Sharing Contributions and their related earnings are 100% vested and non-forfeitable.

Forfeited Accounts

At December 31, 2014 and 2013, forfeited non-vested accounts totaled $2,776,513 and $2,754,066, respectively. These amounts will be used to reduce future employer contributions or pay Plan expenses. In 2014, employer contributions were reduced by $398,878 from forfeited non-vested accounts.

Notes Receivable from Participants

The Plan provides for loans and hardship withdrawals. Eligible participants can obtain loans from their qualifying account balances, as defined by the Plan. General purpose loans and residential loans (for purchasing the participant’s principal residence) are available. A loan to a participant may not be made in an amount less than $1,000. Total outstanding loans may not exceed the lesser of $50,000 or 50% of the participant’s vested account balance.

 

5


Table of Contents

J. WALTER THOMPSON COMPANY PROFIT SHARING

AND MATCHED SAVINGS PLAN

NOTES TO FINANCIAL STATEMENTS

AS OF DECEMBER 31, 2014 AND 2013 AND FOR THE YEAR ENDED DECEMBER 31, 2014

 

 

1. DESCRIPTION OF THE PLAN - (continued)

 

Notes Receivable from Participants - (continued)

 

General purpose loans must be repaid within five years and residential loans must be repaid within twenty years. However, the term of a loan may not extend beyond the participant’s employment with a Participating Employer. The loans are secured by the balance in the participant’s account and bear interest at 1% above the prime rate as determined quarterly by the Plan Administrator. Principal and interest are paid ratably through payroll deductions. When loans are repaid the principal and interest are reinvested in the investment funds in which the participant is currently enrolled. During the Plan year 2014 the interest rates on loans ranged from 4.25% to 10.50%.

Payment of Benefits

Distributions from the Plan are generally made in the form of a lump-sum payment. Distributions are made at the time of retirement, termination, disability or death, according to Plan provisions. In addition, upon reaching age 59 12, participants may elect to withdraw an amount equal to all or any portion of his or her interest in their vested Company Contributions, Deferred Contributions and Catch-up Contributions, including earnings thereon. In addition, Rollover Contributions may be withdrawn at any time.

 

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Accounting

The financial statements of the Plan are prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America (“GAAP”).

Investment contracts held by a defined contribution plan are required to be reported at fair value. However, contract value is the relevant measurement attribute for that portion of the net assets available for benefits of a defined contribution plan attributable to fully benefit-responsive investment contracts because contract value is the amount participants would receive if they were to initiate permitted transactions under the terms of the Plan. The Statements of Net Assets Available for Benefits present the fair value of the investment contracts as well as the adjustment of the fully benefit-responsive investment contracts from fair value to contract value. The Statement of Changes in Net Assets Available for Benefits is prepared using the contract value basis for fully benefit-responsive investment contracts.

Investment Valuation and Income Recognition

Investments are reported at fair value. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. 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. Net appreciation/depreciation includes the Plan’s gains and losses on investments bought and sold as well as held during the year.

Notes Receivable from Participants

Notes receivable from participants are measured at their unpaid principal balance plus any accrued but unpaid interest. Interest income is recorded on the accrual basis. Related fees are recorded as administrative expenses and are expensed when they are incurred. No allowance for credit losses has been recorded as of December 31, 2014 and 2013.

 

6


Table of Contents

J. WALTER THOMPSON COMPANY PROFIT SHARING

AND MATCHED SAVINGS PLAN

NOTES TO FINANCIAL STATEMENTS

AS OF DECEMBER 31, 2014 AND 2013 AND FOR THE YEAR ENDED DECEMBER 31, 2014

 

 

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – (continued)

 

Excess Contributions Payable

Amounts payable to participants for contributions in excess of amounts allowed by the Internal Revenue Service (“IRS”) are recorded as a liability with a corresponding reduction to contributions. The Plan distributed the 2014 excess contributions to the applicable participants prior to March 15, 2015.

Use of Estimates

The preparation of financial statements in accordance with GAAP requires Plan management to make 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.

Payment of Benefits

Benefits are recorded when paid.

Administrative and Investment Expenses

Certain administrative and investment expenses of maintaining the Plan are paid by the Plan, unless otherwise paid by the Company. Expenses that are paid by the Company are excluded from these financial statements. Fees related to the administration of notes receivable from participants are charged directly to the participant’s account and are included in administrative expenses. Investment related expenses are included in net appreciation/depreciation of fair value of investments.

Subsequent Events

The Plan’s management has evaluated subsequent events through June 29, 2015, the date the financial statements were available to be issued, and no additional disclosures were required.

 

3. FAIR VALUE MEASUREMENTS

The framework for measuring fair value provides a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy under the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 820 are described as follows: Level 1 inputs consist of unadjusted quoted prices for identical assets or liabilities in active markets that the Plan has the ability to access; Level 2 inputs include quoted prices for similar assets or liabilities in active markets, quoted prices in markets that are not active, inputs other than quoted prices that are observable for the asset or liability, or other inputs that are derived principally from, or corroborated by, observable market data by correlation or other means. If the asset or liability has a specified (contractual) term, the Level 2 input must be observable for substantially the full term of the asset or liability. Level 3 inputs are unobservable and significant to the fair value measurement.

The asset or liability’s fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Valuation techniques maximize the use of relevant observable inputs and minimize the use of unobservable inputs.

 

7


Table of Contents

J. WALTER THOMPSON COMPANY PROFIT SHARING

AND MATCHED SAVINGS PLAN

NOTES TO FINANCIAL STATEMENTS

AS OF DECEMBER 31, 2014 AND 2013 AND FOR THE YEAR ENDED DECEMBER 31, 2014

 

 

3. FAIR VALUE MEASUREMENTS - (continued)

 

The following is a description of the valuation methodologies used for assets measured at fair value. There have been no changes in the methodologies used at December 31, 2014 and 2013.

Level 1

The fair value of the WPP Stock Fund is based on quoted net asset values (“NAV”) of the shares held by the Plan at year-end. The mutual funds are valued at the daily closing prices as reported by the fund. Mutual funds held by the Plan are open-end mutual funds that are registered with the Securities and Exchange Commission. These funds are required to publish their daily NAV and to transact at that price. The mutual funds held by the Plan are deemed to be actively traded.

Level 2

The fair value of the MRJ Value Equity fund, which is not traded in an active market, is valued at the unit value of the fund, which is based on the fair value of the underlying investments.

The Wells Fargo Stable Value Fund C (“Fund”), is a common collective trust fund that invests all of its assets in the Wells Fargo Stable Return Fund G, which invests in traditional and security-backed contracts. The Fund is valued at the NAV, as provided by the trustee, which is used as a practical expedient to estimate fair value. The NAV is based on the fair value of the underlying investments held by the Fund less its liabilities. This practical expedient is not used when it is determined to be probable that the Fund will sell the investment for an amount different than the reported NAV. Participant transactions (purchases and sales) may occur daily. Were the Plan to initiate a full redemption of the collective trust, the investment adviser reserves the right to temporarily delay withdrawal from the trust in order to ensure that securities liquidations will be carried out in an orderly business manner.

 

8


Table of Contents

J. WALTER THOMPSON COMPANY PROFIT SHARING

AND MATCHED SAVINGS PLAN

NOTES TO FINANCIAL STATEMENTS

AS OF DECEMBER 31, 2014 AND 2013 AND FOR THE YEAR ENDED DECEMBER 31, 2014

 

 

3. FAIR VALUE MEASUREMENTS - (continued)

 

The following tables set forth by level, within the fair value hierarchy, the Plan’s assets at fair value as of December 31, 2014 and 2013:

 

     Assets at Fair Value as of December 31, 2014  
     Level 1      Level 2      Level 3      Total  

Mutual funds:

           

Bond funds

   $ 80,942,945       $ —         $ —         $ 80,942,945   

Growth funds

     62,289,685         —           —           62,289,685   

Index fund

     38,578,585         —           —           38,578,585   

International fund

     40,875,601         —           —           40,875,601   

Value funds

     32,542,561         —           —           32,542,561   

Stock fund

     —           46,920,989         —           46,920,989   

Common collective trust

     —           42,866,679         —           42,866,679   

WPP Stock Fund

     10,484,686         —           —           10,484,686   

Cash and accrued income

     80,441         —           —           80,441   
  

 

 

    

 

 

    

 

 

    

 

 

 

Total assets at fair value

$ 265,794,504    $ 89,787,668    $  —      $ 355,582,172   
  

 

 

    

 

 

    

 

 

    

 

 

 
     Assets at Fair Value as of December 31, 2013  
     Level 1      Level 2      Level 3      Total  

Mutual funds:

           

Bond funds

   $ 73,172,062       $ —         $ —         $ 73,172,062   

Growth funds

     57,774,920         —           —           57,774,920   

Index fund

     33,444,742         —           —           33,444,742   

International fund

     41,846,057         —           —           41,846,057   

Value funds

     31,989,721         —           —           31,989,721   

Stock fund

     —           43,816,579         —           43,816,579   

Common collective trust

     —           45,491,261         —           45,491,261   

WPP Stock Fund

     11,892,813         —           —           11,892,813   

Cash and accrued income

     335,883         —           —           335,883   
  

 

 

    

 

 

    

 

 

    

 

 

 

Total assets at fair value

$ 250,456,198    $ 89,307,840    $ —      $ 339,764,038   
  

 

 

    

 

 

    

 

 

    

 

 

 

 

9


Table of Contents

J. WALTER THOMPSON COMPANY PROFIT SHARING

AND MATCHED SAVINGS PLAN

NOTES TO FINANCIAL STATEMENTS

AS OF DECEMBER 31, 2014 AND 2013 AND FOR THE YEAR ENDED DECEMBER 31, 2014

 

 

4. INVESTMENT IN COLLECTIVE TRUST

The investment in the Wells Fargo Stable Value Fund C, which is solely invested in the Wells Fargo Stable Return Fund G, includes fully benefit-responsive investments stated at fair value. Contract value is equal to principal balance plus accrued interest. There are no reserves against contract value for credit risk of the contract issuer or otherwise. There are no unfunded commitments and the redemption frequency is daily. The redemption notice period of the Fund is twelve months, which provides for Plan redemptions at contract value, subject to the provisions of the Fund. The average yield and crediting interest rates for the Fund were 1.40% and 1.64%, respectively, for 2014 and 1.36% and 1.52%, respectively, for 2013. The crediting interest rate is based on a formula agreed upon with the issuer.

Certain events limit the ability of the Plan to transact at contract value with the issuer. Such events include (1) amendments to the Plan documents (including complete or partial Plan termination or merger with another Plan), (2) changes to the Plan’s prohibition on competing investment options or deletion of equity wash provisions, (3) bankruptcy of the Plan sponsor or other Plan sponsor events that cause a significant withdrawal from the Plan, or (4) the failure of the trust to qualify for exemption from federal income taxes or any required prohibited transaction exemption under ERISA. The Plan Administrator believes that any events that would limit the Plan’s ability to transact at contract value with participants are probable of not occurring.

 

5. INVESTMENTS

The Plan’s investments are held in a trust fund. The following presents Plan investments that represent five percent or more of the Plan’s net assets available for benefits as of December 31, 2014 and 2013:

 

Description of Investment

   2014      2013  

MRJ Value Equity Fund

   $ 46,920,989       $ 43,816,579   

PIMCO Total Return Fund

     43,355,982         40,341,733   

Wells Fargo Stable Value Fund C

     42,866,679         45,491,261   

MFS International Diversification Fund

     40,875,601         *   

BlackRock Capital Appreciation Fund

     36,769,344         34,564,623   

JPMorgan Government Bond Fund Select

     32,696,896         32,830,329   

Vanguard Institutional Index Fund

     30,123,960         25,701,917   

BlackRock US Opportunities Port Fund

     25,520,342         23,210,297   

Thornburg Int’l Value Fund

     *         41,846,057   

 

* This investment did not represent 5% or more of the Plan’s net assets available for benefits at December 31, 2014 or 2013.

 

10


Table of Contents

J. WALTER THOMPSON COMPANY PROFIT SHARING

AND MATCHED SAVINGS PLAN

NOTES TO FINANCIAL STATEMENTS

AS OF DECEMBER 31, 2014 AND 2013 AND FOR THE YEAR ENDED DECEMBER 31, 2014

 

 

5. INVESTMENTS – (continued)

 

During 2014, the Plan’s investments (including gains and losses on investments bought and sold, as well as held during the year) depreciated in value by $4,935,907 as follows:

 

WPP Stock Fund

($ 1,092,675

Common collective trust

  528,234   

MRJ Value Equity Fund

  5,310,708   

Mutual funds

  (9,682,174
  

 

 

 

Net depreciation in fair value of investments

($ 4,935,907
  

 

 

 

 

6. TAX STATUS

The IRS has determined and informed the Company by a letter dated September 27, 2013, that the Plan and related Trust are designed in accordance with applicable sections of the Internal Revenue Code (“IRC”). Although the Plan has been amended since receiving the determination letter, the Plan Administrator believes that the Plan is designed, and is currently being operated, in compliance with the applicable requirements of the IRC and, therefore, believes that the Plan is qualified and the related trust is tax-exempt.

GAAP requires Plan management to evaluate tax positions taken by the Plan and recognize a tax liability if the Plan has taken an uncertain position that more likely than not would not be sustained upon examination by the IRS. The Plan is subject to routine audits by taxing jurisdictions; however, there are currently no audits for any tax periods in progress. The Plan Administrator believes it is no longer subject to income tax examinations for years prior to 2011.

 

7. PARTY-IN-INTEREST TRANSACTIONS

Certain Plan investments are shares of mutual funds managed by BOA, the Trustee and record-keeper of the Plan.

The Plan also provides participants the option to invest in the WPP Stock Fund, a party-in-interest. The Plan held 100,717 WPP plc ADSs in the WPP Stock Fund valued at $10,484,686 at December 31, 2014, and at December 31, 2013 the Plan held 103,542 WPP plc ADSs in the WPP Stock Fund valued at $11,892,813.

These transactions qualify as exempt party-in-interest transactions. There have been no known prohibited transactions with parties-in-interest

 

8. 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 would become 100% vested in the Company contribution portion of their account.

 

11


Table of Contents

J. WALTER THOMPSON COMPANY PROFIT SHARING

AND MATCHED SAVINGS PLAN

NOTES TO FINANCIAL STATEMENTS

AS OF DECEMBER 31, 2014 AND 2013 AND FOR THE YEAR ENDED DECEMBER 31, 2014

 

 

9. RISKS AND UNCERTAINTIES

The Plan invests in various investment securities. Investment securities, are exposed to various risks, such as interest rate, market, and credit risks. Due to the level of risk associated with certain investment securities, it is at least reasonably possible that changes in the values of investment securities will occur in the near term and that such changes could materially affect participants’ account balances and the amounts reported in the statements of net assets available for benefits.

 

10. NET ASSET TRANSFERS

During 2014, net assets of $2,423,398, representing certain participant account balances were transferred into the Plan from the Digitaria Interactive, Inc 401(K) Plan and net assets of $8,308,178 were transferred out of the Plan to the Savings & Investment Plan, both tax-qualified retirement plans sponsored by an affiliate of the Plan sponsor.

***

 

12


Table of Contents
EIN: 13-01378860 J. WALTER THOMPSON COMPANY PROFIT SHARING
PN: 010 AND MATCHED SAVINGS PLAN
Form 5500, Schedule H, Part IV, line 4i -
Schedule of Assets (Held at End of Year)
December 31, 2014

 

 

(a)

  

(b) Identity of Issue, Borrower,

Lessor or Similar Party

  

(c) Description of Investment,

Including Maturity Date,

Rate of Interest, Collateral,

Par or Maturity Value

   (d)
Cost
  (e) Current
Value
 
   WPP Stock Fund        

*

  

WPP plc

   American Depositary Shares    **   $ 10,484,686   
          

 

 

 
Common Collective Trust

Wells Fargo Stable Value Fund C

Common Collective Trust **   42,866,679   
          

 

 

 
Mutual Funds

Allianz NFJ Small-Cap Value Fund

Mutual fund **   15,690,496   

*

BlackRock Capital Appreciation Fund

Mutual fund **   36,769,344   

*

BlackRock US Opportunities Port Fund

Mutual fund **   25,520,342   

Fidelity Advisor Small Cap Fund

Mutual fund **   8,454,625   

JP Morgan Government Bond Fund Select

Mutual fund **   32,696,896   

MFS International Diversification Fund

Mutual fund **   40,875,601   

PIMCO Total Return Fund

Mutual fund **   43,355,982   

T. Rowe Price Inflation Fund

Mutual fund **   4,890,066   

Vanguard Institutional Index Fund

Mutual fund **   30,123,960   

Vanguard Selected Value Fund

Mutual fund **   16,852,065   
          

 

 

 

Total mutual funds

  255,229,377   
          

 

 

 
MRJ Value Equity Fund Stock Fund **   46,920,989   
          

 

 

 
Cash, cash equivalents and accrued income   80,441   
          

 

 

 

Total Investments

  355,582,172   
Notes receivable from participants Interest rates from 4.25% - 10.50% maturing through July 2034   4,817,733   
          

 

 

 

Total Assets Held at End of Year

$ 360,399,905   
          

 

 

 

 

 

* Party-in-interest.
** Cost information is not required for participant-directed investments and, therefore, is not included.

See accompanying Report of Independent Registered Public Accounting Firm.

 

13


Table of Contents
EIN: 13-01378860    J. WALTER THOMPSON COMPANY PROFIT SHARING
PN: 010    AND MATCHED SAVINGS PLAN
   Form 5500, Schedule H, Part IV, line 4a -
   Schedule of Delinquent Participant Contributions
   For the Year Ended December 31, 2014

 

Total that Constitute Nonexempt Prohibited Transactions

 

Participant

Contributions

Transferred Late to

Plan

   Contributions
Not Corrected
     Contributions
Corrected Outside
VFCP
     Contributions
Pending Correction
in VFCP
     Total Fully
Corrected Under
VFCP and PTE
2002-51
 

Late Participant Loan Repayments are included

   $ —         $ 23,715       $ —         $ —     

The item listed above refers to certain participant contributions that were deposited to the Plan in a delayed manner, caused by an inadvertent administrative error. The Company has fully corrected this matter by making all affected participant accounts whole, crediting them with any lost earnings and appreciation for the period of the delayed transfer.

See accompanying Report of Independent Registered Public Accounting Firm.

 

14


Table of Contents

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.

 

J. WALTER THOMPSON COMPANY PROFIT SHARING AND MATCHED SAVINGS PLAN
Date: June 29, 2015 By:

/s/ Donna Matteo

Name: Donna Matteo
Title: Director of Benefits

 

15


Table of Contents

INDEX TO EXHIBITS

 

Exhibit

No.

  

Description

23.1    Consent of Independent Registered Public Accounting Firm

 

16