UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
(Mark One)
[ X ] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2015
Or
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission file number: 001-07434
Aflac Incorporated 401(k) Savings and Profit Sharing Plan | ||||
(Full title of the plan) | ||||
Aflac Incorporated | ||||
(Name of issuer of the securities held pursuant to the plan) | ||||
1932 Wynnton Road Columbus, Georgia 31999 | ||||
(Address of the plan and address of issuer’s principal executive offices) | ||||
Aflac Incorporated 401(k) Savings and Profit Sharing Plan
Table of Contents
Page | ||
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Plan Administrator
Aflac Incorporated 401(k) Savings and Profit Sharing Plan:
We have audited the accompanying statements of net assets available for plan benefits of the Aflac Incorporated 401(k) Savings and Profit Sharing Plan (the Plan) as of December 31, 2015 and 2014, and the related statements of changes in net assets available for plan 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 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 plan benefits of the Plan as of December 31, 2015 and 2014, and the changes in net assets available for plan benefits for the years then ended, in conformity with U.S. generally accepted accounting principles.
The supplemental information in the accompanying Schedule of Assets (Held at End of Year) as of December 31, 2015, has been subjected to audit procedures performed in conjunction with the audit of the Plan’s 2015 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, 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 Schedule of Assets (Held at End of Year) as of December 31, 2015 is fairly stated in all material respects in relation to the 2015 financial statements as a whole.
/s/ KPMG LLP | ||
Atlanta, Georgia | ||
June 20, 2016 | ||
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Aflac Incorporated 401(k) Savings and Profit Sharing Plan
Statements of Net Assets Available for Plan Benefits
December 31,
2015 | 2014 | |||||||
Assets: | ||||||||
Investments, at fair value (Note 6) | $ | 320,902,662 | $ | 306,884,924 | ||||
Notes receivable from participants | 11,845,993 | 11,138,695 | ||||||
Cash | 0 | 6,462 | ||||||
Accrued employer contribution | 376,525 | 288,237 | ||||||
Accrued participant contribution | 777,716 | 669,817 | ||||||
Total assets | 333,902,896 | 318,988,135 | ||||||
Liabilities: | ||||||||
Excess participant contributions payable | 0 | 158,369 | ||||||
Total liabilities | 0 | 158,369 | ||||||
Net assets available for plan benefits before adjustments | 333,902,896 | 318,829,766 | ||||||
Adjustment from fair value to contract value for fully benefit-responsive investment contracts | (14,994 | ) | (270,575 | ) | ||||
Net assets available for plan benefits | $ | 333,887,902 | $ | 318,559,191 | ||||
See accompanying Notes to Financial Statements.
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Aflac Incorporated 401(k) Savings and Profit Sharing Plan
Statements of Changes in Net Assets Available for Plan Benefits
Years Ended December 31,
2015 | 2014 | |||||||
Contributions and transfers: | ||||||||
Participant withholdings | $ | 21,691,379 | $ | 16,961,799 | ||||
Participant transfers from other plans | 2,086,164 | 1,579,272 | ||||||
Employer matching | 9,074,140 | 6,994,447 | ||||||
Total contributions and transfers | 32,851,683 | 25,535,518 | ||||||
Dividend income | 13,464,541 | 12,524,499 | ||||||
Interest income | 589,124 | 549,965 | ||||||
Net appreciation (depreciation) in fair value of investments (Note 5) | (11,358,890 | ) | (7,018,567 | ) | ||||
Distributions to participants | (20,119,846 | ) | (16,599,279 | ) | ||||
Administrative fees | (97,901 | ) | (60,261 | ) | ||||
Increase (decrease) in net assets | 15,328,711 | 14,931,875 | ||||||
Net assets available for plan benefits: | ||||||||
Beginning of year | 318,559,191 | 303,627,316 | ||||||
End of year | $ | 333,887,902 | $ | 318,559,191 | ||||
See accompanying Notes to Financial Statements.
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Aflac Incorporated 401(k) Savings and Profit Sharing Plan
Notes to Financial Statements
December 31, 2015 and 2014
1. DESCRIPTION OF THE PLAN
The Aflac Incorporated 401(k) Savings and Profit Sharing Plan (the Plan) was established for the benefit of the employees of Aflac Incorporated; American Family Life Assurance Company of Columbus (excluding Japan Branch employees and, effective September 2014, Puerto Rico residents); American Family Life Assurance Company of New York; Aflac International, Inc. (excluding Japan Branch employees); Continental American Insurance Company (CAIC); Communicorp, Inc.; Aflac Benefits Advisors, Inc.; and, effective October 1, 2015, Empoweredbenefits, LLC. The aforementioned entities are collectively referred to as "the Company" in this report.
The Company stock fund investment under the Plan is an employee stock ownership plan with a dividend pass-through option. This option allows participants to make an election to receive any Company stock dividends in cash instead of using them to buy more Company stock in the participant's 401(k) account.
The following description provides only general information. Participants should refer to the Plan agreement for a more complete description of the Plan's provisions.
(a) | General |
The Plan is subject to certain provisions of the Employee Retirement Income Security Act of 1974 (ERISA).
Eligible employees may voluntarily participate in the Plan on the first day of the payroll period following their employment date.
The Plan is administered by a plan administrator appointed by Aflac Incorporated's Board of Directors. For the years ended December 31, 2015 and 2014, T. Rowe Price Trust Company was the Plan's trustee and administrator. The majority of the Plan's administrative expenses are paid by the Plan. Administrative fees on loans and in-service withdrawal expenses are paid directly by the requesting participant and are deducted from the loan or in-service withdrawal amount.
(b) | Contributions and Transfers |
Contributions to the Plan are made by both participants and the Company. Participants may contribute portions of their salary and bonus in increments of whole percentages of up to 75%, subject to aggregate limits imposed by Internal Revenue Service (IRS) regulations. Aggregate limits as prescribed by the IRS were $18,000 and $17,500 for participants under the age of 50 and $24,000 and $23,000 for participants age 50 and older in 2015 and 2014, respectively. Participants can elect whether to make contributions on a pre-tax basis (traditional 401(k)) or on an after-tax basis (Roth 401(k)). The first 1% to 6% of participants' compensation contributed may be subject to a percentage matching contribution by the Company. For the years ended December 31, 2015 and 2014, subject to certain limitations, the Company's matching contribution was 50% of the portion of the participants' contributions, which were not in excess of 6% of the participants' annual cash compensation. Participants may transfer into the Plan amounts representing distributions from other eligible plans.
Effective January 1, 2014, the Company provides a nonelective contribution of 2% of annual cash compensation for employees who elected to opt out of the future benefits of the Aflac Incorporated defined benefit plan during the election period provided during the fourth quarter of 2013 and for new U.S. employees who started working for the Company after September 30, 2013.
(c) | Participant Accounts |
An account is maintained for each participant and is credited with participant contributions and investment earnings or losses thereon. Contributions may be invested in one or more of the investment funds available under the Plan at the direction of the participant. A separate account is maintained with respect to each participant's interest in the Company's matching contributions. Amounts in this account are apportioned and invested in the same manner as the participant's account.
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(d) | Vesting |
Participants are 100% vested in their contributions plus investment earnings or losses thereon.
Participants become vested in the Company’s matching contributions and nonelective contributions and the related earnings or losses thereon according to the following schedule.
Years of Service | Vested Percentage | |
Less than 1 | 0% | |
1 | 20% | |
2 | 40% | |
3 | 60% | |
4 | 80% | |
5 or more | 100% | |
A participant's interest in the Company's matching contributions and nonelective contributions and the related earnings or losses thereon is also vested upon termination either because of death or disability or after attaining early retirement date or normal retirement age. Except as previously described, participants forfeit the portion of their interest which is not vested upon termination of employment. These forfeitures are available to reduce the Company's future matching contributions or plan expenses. At December 31, 2015, there was an ending balance of approximately $124,000 in forfeited non-vested accounts, compared with approximately $32,000 at December 31, 2014. In 2015, forfeitures of approximately $535,000 were used to reduce matching contributions, compared with approximately $404,000 in 2014.
(e) | Distributions |
Participants may receive a distribution equal to the vested value of their account upon death, disability, retirement, or termination of either the Plan or the participant's employment. Distributions may only be made in the form of a lump-sum cash payment and/or Aflac Incorporated common stock. Certain eligible participants can elect periodic withdrawals and installment distributions.
The Plan permits in-service withdrawals from vested account balances for participants who have attained age 59 ½. Additionally, hardship withdrawals are available under certain circumstances for which the participant must provide documentation.
(f) | Notes receivable from participants |
Participants are allowed to borrow funds from their accounts. The minimum amount of any notes receivable is $1,000. No participant may have more than one loan outstanding at any time, except that a participant may have more than one loan outstanding if both loans were issued before August 1, 2012, or if multiple loans were transferred from predecessor plans. The maximum amount of loans made to a participant from the Plan, when added together, cannot exceed the lesser of:
a. 50% of the participant's vested benefit (as defined by the Plan document); or
b. $50,000, reduced by the amount, if any, of the highest balance of all outstanding loans to the participant during the one-year period ending on the day prior to the day on which the loan is made.
All notes receivable carry a maturity date of up to five years for general purpose loans and up to 10 years for loans made to purchase the participant's principal residence and are secured by the balance in the participant's account. Interest rates on participant loans are established at the prevailing prime interest rate at the time the loan is made plus 2%. The prime interest rate was 3.50% at December 31, 2015 and 3.25% at December 31, 2014. Participant loans are classified as notes receivable from participants, which are segregated from plan investments and measured at their unpaid principal balance plus any accrued but unpaid interest.
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(g) | Transactions With Parties-in-Interest |
As of December 31, 2015 and 2014, the statements of net assets available for plan benefits include the following investments and notes receivable with parties-in-interest to the Plan.
2015 | 2014 | |||||||
T. Rowe Price Blue Chip Growth Fund | $ | 21,096,831 | $ | 17,458,633 | ||||
T. Rowe Price Balanced Fund | 47,962,536 | 47,513,713 | ||||||
T. Rowe Price Equity Income Fund | 20,169,691 | 22,197,395 | ||||||
T. Rowe Price Mid-Cap Growth Fund | 16,048,187 | 13,559,392 | ||||||
T. Rowe Price Mid-Cap Value Fund | 3,440,188 | 2,743,852 | ||||||
T. Rowe Price Retirement Balanced Fund | 0 | 305,199 | ||||||
T. Rowe Price Retirement 2005 Fund | 394,745 | 384,641 | ||||||
T. Rowe Price Retirement 2010 Fund | 496,641 | 276,136 | ||||||
T. Rowe Price Retirement 2015 Fund | 2,521,605 | 3,167,640 | ||||||
T. Rowe Price Retirement 2020 Fund | 5,004,352 | 4,576,742 | ||||||
T. Rowe Price Retirement 2025 Fund | 6,185,574 | 4,047,943 | ||||||
T. Rowe Price Retirement 2030 Fund | 5,958,099 | 3,686,232 | ||||||
T. Rowe Price Retirement 2035 Fund | 5,865,984 | 3,486,982 | ||||||
T. Rowe Price Retirement 2040 Fund | 6,450,065 | 4,040,458 | ||||||
T. Rowe Price Retirement 2045 Fund | 4,507,750 | 2,872,446 | ||||||
T. Rowe Price Retirement 2050 Fund | 4,071,670 | 2,633,037 | ||||||
T. Rowe Price Retirement 2055 Fund | 1,554,221 | 906,483 | ||||||
T. Rowe Price Retirement 2060 Fund | 31,173 | 0 | ||||||
T. Rowe Price Stable Value Common Trust Fund* | 18,859,930 | 18,394,699 | ||||||
T. Rowe Price U.S. Treasury Money Market Trust | 2,770,182 | 2,116,936 | ||||||
Aflac Incorporated common stock | 89,604,088 | 95,792,932 | ||||||
Notes receivable from participants | 11,845,993 | 11,138,695 | ||||||
* Includes adjustment to contract value of $(14,994) in 2015 and $(270,575) in 2014
The Plan’s investments include shares of common stock issued by Aflac Inc., the Plan sponsor. At December 31, 2015 and 2014, the Plan held a combined total of 1.5 million and 1.6 million shares valued at approximately $59.90 and $61.09 per share, respectively. Additionally, the Plan received dividends paid by the Aflac Inc. common stock totaling $2.3 million for each of the years ended December 31, 2015 and 2014. The Plan paid fees totaling approximately $49,000 and $60,300 to T. Rowe Price during 2015 and 2014, respectively.
2. SUMMARY OF ACCOUNTING POLICIES
(a) | Basis of Presentation |
The accompanying statements of net assets available for plan benefits and changes in net assets available for plan benefits have been prepared on the accrual basis of accounting.
The preparation of financial statements in conformity with U.S. generally accepted accounting principles (GAAP) requires the plan administrator 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.
(b) | Investment Valuation and Income Recognition |
Investments are stated at fair value. Investments in mutual funds and common shares are stated at fair value based upon market quotations obtained from national security exchanges. Investments in common/collective trusts, the T. Rowe Price Stable Value Common Trust Fund and T. Rowe Price U.S. Treasury Money Market Trust, are described below.
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The T. Rowe Price U.S. Treasury Money Market Trust's reported fair values are based on the net asset value (NAV) which is calculated utilizing quoted market prices, most recent bid prices in the principal market in which the securities are normally traded, pricing services and dealer quotes. The T. Rowe Price Stable Value Common Trust Fund primarily holds investments in fully benefit-responsive investment contracts that provide that the Plan may make withdrawals at contract value for benefit-responsive requirements. In accordance with applicable accounting guidance, the Plan's investment in units of these trusts is presented at fair value in the statements of net assets available for plan benefits, with an adjustment to its underlying contract value displayed separately. Contract value (also known as book value) is original cost plus accrued income and deposits minus withdrawals. The T. Rowe Price Stable Value Common Trust Fund's reported fair values are determined as the sum of (a) the fair value of the investments in guaranteed insurance contracts and security-backed investment contracts that are wrapped by an insurance company, bank or other financial institution (collectively, the “Investment Contracts”) and (b) the fair value of that fund's investments in externally managed collective investment funds.
Securities transactions are accounted for on the trade date (the date the order to buy or sell is executed). Realized gains and losses on the sale of investments are calculated based on the difference between selling price and cost on an average cost basis. Interest income is recorded on the accrual basis. Dividends are recorded on the ex-dividend date.
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 could occur and that such changes could materially affect participants' account balances and the amounts reported in the statements of net assets available for plan benefits.
(c) | Distributions |
Distributions to participants are recorded when paid.
(d) | Fair Value of Financial Instruments |
Investments are stated at fair value with the exception of the Plan's fully benefit-responsive investment contracts which, though stated at fair value, are adjusted to contract value within the statement of net assets available for plan benefits. Notes receivable from participants are stated at their unpaid principal balance plus any accrued but unpaid interest, which approximates fair value. The carrying amounts for cash, receivables, and payables approximated their fair values due to the short-term nature of these instruments.
(e) | New Accounting Pronouncements |
Accounting Pronouncements Pending Adoption
Fair Value Measurement - Disclosures for investments in certain entities that calculate net asset value per share (or its equivalent): In May 2015, the Financial Accounting Standards Board (FASB) issued guidance that eliminates the requirement to categorize investments in the fair value hierarchy if their fair value is measured at NAV per share (or its equivalent) using the practical expedient in FASB Accounting Standards Codification (ASC) Topic 820, Fair Value Measurement. Reporting entities must provide sufficient information to enable users to reconcile total investments in the fair value hierarchy and total investments measured at fair value in the statement of financial position. Additionally, the scope of current disclosure requirements for investments eligible to be measured at NAV will be limited to investments to which the practical expedient is applied. This guidance is effective for public business entities in fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. It is effective for all other entities in fiscal years beginning after December 15, 2016, and interim periods within those fiscal years. This guidance requires retrospective application. The adoption of this guidance will not have an impact on the Plan's net assets available for plan benefits or the changes in net assets available for plan benefits.
Plan Accounting: Defined Benefit Pension Plans, Defined Contribution Pension Plans, Health and Welfare Benefit Plans: Fully Benefit-Responsive Investment Contracts, Plan Investment Disclosures, Measurement Date Practical Expedient: In July 2015, the FASB issued a three-part accounting standard that provides guidance on certain aspects of the accounting by employee benefit plans. Part I of the standard requires an employee benefit plan to use contract value as the only measurement amount for fully benefit responsive investment contracts. Part II simplifies plan investment disclosure requirements for employee benefit plans. Part
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III provides employee benefit plans with a measurement-date practical expedient. This guidance is effective for all business entities in fiscal years beginning after December 15, 2015. This guidance requires retrospective application for Parts I and II and prospective application for Part III. The adoption of Parts I and II of this guidance will impact disclosures but will not have a significant impact on the Plan's net assets available for plan benefits or the changes in net assets available for plan benefits. Part III of this accounting standard is not applicable to the Plan.
Financial Instruments - Recognition and Measurement of Financial Assets and Financial Liabilities: In January 2016, the FASB issued guidance to address certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. For employee benefit plans within the scope of Topics 960 through 965 on plan accounting, the amendments in this update are effective for fiscal years beginning after December 15, 2018, and interim periods within fiscal years beginning after December 15, 2019. We are currently evaluating the impact of this guidance on the Plan's net assets available for plan benefits, the changes in net assets available for plan benefits, and disclosures.
3. FEDERAL INCOME TAXES
The IRS has determined and informed the Company by letter dated March 25, 2016, that the Plan and related trust are designed in accordance with applicable sections of the Internal Revenue Code and therefore, are exempted from federal income taxes.
U.S. GAAP requires the Company to evaluate tax positions taken by the Plan and recognize a tax liability (or asset) if the Plan has taken an uncertain position that more likely than not would not be sustained upon examination by the IRS. The Company has analyzed the tax positions taken by the Plan, and has concluded that as of December 31, 2015 and 2014, there are no uncertain positions taken or expected to be taken that would require recognition of a liability (or asset) or disclosure in the financial statements. The Plan is subject to routine audits by taxing jurisdictions; however, there are currently no audits for any tax periods in progress.
4. PLAN TERMINATION
Although it has not expressed any intent to do so, the Company has the right to terminate the Plan at any time subject to the provisions of ERISA. In the event of Plan termination, participants would become 100% vested in their accounts.
5. INVESTMENT FUNDS
The following table presents the fair value of individual investments that exceeded 5% of the Plan’s net assets as of December 31:
2015 | 2014 | |||||||
Mutual funds: | ||||||||
T. Rowe Price Blue Chip Growth Fund | $ | 21,096,831 | $ | 17,458,633 | ||||
T. Rowe Price Balanced Fund | 47,962,536 | 47,513,713 | ||||||
T. Rowe Price Equity Income Fund | 20,169,691 | 22,197,395 | ||||||
Vanguard Institutional Index Fund, Institutional | 27,136,926 | 27,712,321 | ||||||
Common/collective trust funds: | ||||||||
T. Rowe Price Stable Value Common Trust Fund* | 18,859,930 | 18,394,699 | ||||||
Aflac Incorporated common stock** | 89,604,088 | 95,792,932 | ||||||
* Includes adjustment to contract value of $(14,994) in 2015 and $(270,575) in 2014
** Shares held totaled 1,495,895 and 1,568,062 at December 31, 2015 and 2014, respectively
During 2015 and 2014, the Plan's investments (including gains and losses on investments bought and sold, as well as held during the year) appreciated (depreciated) in value as follows:
2015 | 2014 | |||||||
Mutual funds | $ | (9,647,586 | ) | $ | 2,192,664 | |||
Aflac Incorporated common stock | (1,711,304 | ) | (9,211,231 | ) | ||||
Total net appreciation (depreciation) in fair value of investments | $ | (11,358,890 | ) | $ | (7,018,567 | ) | ||
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6. FAIR VALUE MEASUREMENTS
ASC Topic 820, Fair Value Measurement, provides the framework for measuring fair value. That framework provides a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three valuation hierarchy levels. Level 1 valuations reflect quoted market prices for identical assets or liabilities in active markets. Level 2 valuations reflect quoted market prices for similar assets or liabilities in an active market, quoted market prices for identical or similar assets or liabilities in non-active markets or model-derived valuations in which all significant valuation inputs are observable in active markets. Level 3 valuations reflect valuations in which one or more of the significant inputs are not observable in an active market.
The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The asset's 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 observable inputs and minimize the use of unobservable inputs.
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, 2015 and 2014.
The fair value of investments categorized as Level 1, consisting of mutual funds and common stock, is based on quoted market prices for identical securities traded in active markets that are readily and regularly available. The fair value of investments categorized as Level 2, consisting of common/collective trusts, is based on the NAV calculated by its issuer utilizing quoted market prices, most recent bid prices in the principal market in which the securities are normally traded, pricing services and dealer quotes. Net asset values are reported by the funds and are supported by the unit prices of actual purchases and sale transactions occurring as of or close to the financial statement date. The fair value of the underlying Investment Contracts held by the trust are valued using a discounted cash flow model, which considers (i) recent fee bids as determined by recognized dealers, (ii) discount rate, and (iii) the duration of the underlying portfolio securities.
The methods described above may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. Furthermore, while the Plan believes its valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in different fair value measurement at the reporting date.
The following tables set forth by level, within the fair value hierarchy, the Plan's investments at fair value as of December 31.
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2015 | ||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Assets, at fair value: | ||||||||||||||||
Investments: | ||||||||||||||||
Mutual funds: | ||||||||||||||||
Small cap funds | $ | 3,878,278 | $ | — | $ | — | $ | 3,878,278 | ||||||||
Mid cap funds | 22,491,016 | — | — | 22,491,016 | ||||||||||||
Large cap funds | 68,403,448 | — | — | 68,403,448 | ||||||||||||
International funds | 13,895,319 | — | — | 13,895,319 | ||||||||||||
Blended funds | 91,004,415 | — | — | 91,004,415 | ||||||||||||
Fixed income bond funds | 9,980,992 | — | — | 9,980,992 | ||||||||||||
Common/collective trust funds | — | 21,645,106 | — | 21,645,106 | ||||||||||||
Aflac Incorporated common stock | 89,604,088 | — | — | 89,604,088 | ||||||||||||
Total assets at fair value | $ | 299,257,556 | $ | 21,645,106 | $ | — | $ | 320,902,662 | ||||||||
2014 | ||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Assets, at fair value: | ||||||||||||||||
Cash | $ | 6,462 | $ | — | $ | — | $ | 6,462 | ||||||||
Investments: | ||||||||||||||||
Mutual funds: | ||||||||||||||||
Small cap funds | 4,256,896 | — | — | 4,256,896 | ||||||||||||
Mid cap funds | 18,638,618 | — | — | 18,638,618 | ||||||||||||
Large cap funds | 67,368,349 | — | — | 67,368,349 | ||||||||||||
International funds | 13,650,138 | — | — | 13,650,138 | ||||||||||||
Blended funds | 77,897,652 | — | — | 77,897,652 | ||||||||||||
Fixed income bond funds | 8,498,129 | — | — | 8,498,129 | ||||||||||||
Common/collective trust funds | — | 20,782,210 | — | 20,782,210 | ||||||||||||
Aflac Incorporated common stock | 95,792,932 | — | — | 95,792,932 | ||||||||||||
Total assets at fair value | $ | 286,109,176 | $ | 20,782,210 | $ | — | $ | 306,891,386 | ||||||||
There are no restrictions on the ability of investors to redeem any of these investments at December 31, 2015 and 2014.
The Plan does not have any liabilities that are measured at fair value on a recurring basis as of December 31, 2015 and 2014.
7. RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500
The following is a reconciliation of net assets available for plan benefits as presented in these financial statements to the balance per Form 5500 as of December 31:
2015 | 2014 | |||||||
Net assets available for plan benefits per the financial statements | $ | 333,887,902 | $ | 318,559,191 | ||||
Adjustment from contract value to fair value for fully benefit-responsive investment contracts | 14,994 | 270,575 | ||||||
Participant withdrawals not yet distributed | (93,941 | ) | 0 | |||||
Deemed distributions | (58,345 | ) | (62,429 | ) | ||||
Net assets available for plan benefits per the Form 5500 | $ | 333,750,610 | $ | 318,767,337 | ||||
Deemed distributions are defaulted and unpaid notes receivable from active participants that are disallowed on Form 5500.
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The following is a reconciliation of changes in net assets available for plan benefits as presented in these financial statements and Form 5500 as of December 31:
2015 | 2014 | |||||||
Net increase in net assets available for plan benefits per the financial statements | $ | 15,328,711 | $ | 14,931,875 | ||||
Prior year adjustment from contract value to fair value for fully benefit- responsive investment contracts | (270,575 | ) | (250,852 | ) | ||||
Current year adjustment from contract value to fair value for fully benefit- responsive investment contracts | 14,994 | 270,575 | ||||||
Participant withdrawals not yet distributed | (93,941 | ) | 0 | |||||
Deemed distributions | 4,084 | (2,805 | ) | |||||
Net increase in net assets per the Form 5500 | $ | 14,983,273 | $ | 14,948,793 | ||||
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SCHEDULE 1
Aflac Incorporated 401(k) Savings and Profit Sharing Plan
EIN: 58-1167100 PN: 004
Form 5500, Schedule H, Line 4i - Schedule of Assets (Held at End of Year)
As of December 31, 2015
Identity of Issue and Description of Investment | Shares/Units | Current Value | ||||||
Mutual Funds | ||||||||
Vanguard Inflation-Protected Securities Fund, Admiral | 38,211 | 963,290 | ||||||
Vanguard Total Bond Market Index Fund, Institutional | 148,557 | 1,580,641 | ||||||
American Funds Europacific Growth Fund, R6 | 272,237 | 12,337,803 | ||||||
T. Rowe Price Blue Chip Growth Fund* | 291,473 | 21,096,831 | ||||||
T. Rowe Price Balanced Fund* | 2,234,974 | 47,962,536 | ||||||
T. Rowe Price Equity Income Fund* | 708,703 | 20,169,691 | ||||||
T. Rowe Price Mid-Cap Growth Fund* | 218,879 | 16,048,187 | ||||||
T. Rowe Price Mid-Cap Value Fund* | 137,939 | 3,440,188 | ||||||
T. Rowe Price Retirement 2005 Fund* | 31,757 | 394,745 | ||||||
T. Rowe Price Retirement 2010 Fund* | 29,422 | 496,641 | ||||||
T. Rowe Price Retirement 2015 Fund* | 184,328 | 2,521,605 | ||||||
T. Rowe Price Retirement 2020 Fund* | 254,157 | 5,004,352 | ||||||
T. Rowe Price Retirement 2025 Fund* | 413,751 | 6,185,574 | ||||||
T. Rowe Price Retirement 2030 Fund* | 273,182 | 5,958,099 | ||||||
T. Rowe Price Retirement 2035 Fund* | 371,500 | 5,865,984 | ||||||
T. Rowe Price Retirement 2040 Fund* | 285,654 | 6,450,065 | ||||||
T. Rowe Price Retirement 2045 Fund* | 297,345 | 4,507,750 | ||||||
T. Rowe Price Retirement 2050 Fund* | 319,597 | 4,071,670 | ||||||
T. Rowe Price Retirement 2055 Fund* | 122,283 | 1,554,221 | ||||||
T. Rowe Price Retirement 2060 Fund* | 3,220 | 31,173 | ||||||
Vanguard Extended Market Index Fund, Institutional | 47,226 | 3,002,641 | ||||||
Vanguard Institutional Index Fund, Institutional | 145,413 | 27,136,926 | ||||||
Vanguard Total International Stock Index, Investor | 107,489 | 1,557,516 | ||||||
Glenmede Smallcap Equity Institutional | 149,740 | 3,878,278 | ||||||
Met West Total Return Bond Plan | 743,706 | 7,437,061 | ||||||
Total Mutual Funds | 209,653,468 | |||||||
Common/Collective Trusts | ||||||||
T. Rowe Price Stable Value Common Trust Fund* | 18,859,930 | 18,874,924 | ** | |||||
T. Rowe Price U.S. Treasury Money Market Trust* | 2,770,182 | 2,770,182 | ||||||
Total Common/Collective Trusts | 21,645,106 | |||||||
Aflac Incorporated common stock* | 1,495,895 | 89,604,088 | ||||||
Participant loans**** (1,972 loans outstanding with zero cost, interest rates from 5.25% to 10.25% and maturity dates of less than one year to 10 years)* | 11,787,648 | *** | ||||||
Total | $ | 332,690,310 | ||||||
*Indicates a party-in-interest to the Plan
**Current value excludes adjustment to contract value of $(14,994)
***Excludes deemed distributions of $58,345
****Also referred to as notes receivable from participants
See accompanying report of independent registered public accounting firm.
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SIGNATURES
The Plan. 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.
Aflac Incorporated 401(k) Savings and | ||||||||||||
Profit Sharing Plan | ||||||||||||
Date: | June 20, 2016 | By: | /s/ Matthew Owenby | |||||||||
Matthew Owenby | ||||||||||||
Senior Vice President, Chief Human Resources Officer | ||||||||||||
13
Exhibit Index
- | Consent of Independent Registered Public Accounting Firm | |||
14