HomeMy Public PortalAbout2015 Audited Financials
THE METROPOLITAN ST. LOUIS
SEWER DISTRICT
DEFINED CONTRIBUTION PLAN
FINANCIAL STATEMENTS
DECEMBER 31, 2015 AND 2014
Contents
Page
Independent Auditors’ Report........................................................................ 1 - 2
Management’s Discussion And Analysis ....................................................... 3 - 7
Financial Statements
Statements Of Fiduciary Net Position................................................................8
Statements Of Changes In Fiduciary Net Position ............................................9
Notes To Financial Statements ................................................................ 10 - 18
Supplemental Information
Historical Trend Information ...........................................................................19
Fund Values And Expense Ratios....................................................................20
Independent Auditors’ Report
Board of Trustees
The Metropolitan St. Louis Sewer District
St. Louis, Missouri
Report On The Financial Statements
We have audited the accompanying Statement of Fiduciary Net Position of The Metropolitan St.
Louis Sewer District Defined Contribution Plan (the Plan) as of December 31, 2015 and 2014, and
the related Statement of Changes in Fiduciary Net Position for the years then ended, and the related
notes to the financial statements, which collectively comprise the Plan’s basic financial statements as
listed in the table of contents.
Management’s Responsibility For The Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in
accordance with accounting principles generally accepted in the United States of America; this
includes the design, implementation, and maintenance of internal control relevant to the preparation
and fair presentation of financial statements that are free from material misstatement, whether due to
fraud or error.
Auditors’ Responsibility
Our responsibility is to express an opinion on these financial statements based on our audits. We
conducted our audits in accordance with auditing standards generally accepted in the United States of
America. Those standards require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures
in the financial statements. The procedures selected depend on the auditors’ judgment, including the
assessment of the risks of material misstatement of the financial statements, whether due to fraud or
error. In making those risk assessments, the auditor considers internal control relevant to the entity’s
preparation and fair presentation of the financial statements in order to design audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also
includes evaluating the appropriateness of accounting policies used and the reasonableness of
significant accounting estimates made by management, as well as evaluating the overall presentation
of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our audit opinion.
Board of Trustees
The Metropolitan St. Louis Sewer District
Opinion
In our opinion, the financial statements referred to above present fairly, in all material respects, the
fiduciary net position of The Metropolitan St. Louis Sewer District Defined Contribution Plan as of
December 31, 2015 and 2014, and the changes in fiduciary net position for the years then ended in
accordance with accounting principles generally accepted in the United States of America.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the
management’s discussion and analysis on pages 3 through 7 be presented to supplement the basic
financial statements. Such information, although not a part of the basic financial statements, is
required by the Governmental Accounting Standards Board who considers it to be an essential part of
financial reporting for placing the basic financial statements in an appropriate operational, economic,
or historical context. We have applied certain limited procedures to the required supplementary
information in accordance with auditing standards generally accepted in the United States of
America, which consisted of inquiries of management about the methods of preparing the
information and comparing the information for consistency with management’s responses to our
inquiries, the basic financial statements, and other knowledge we obtained during our audit of the
basic financial statements. We do not express an opinion or provide any assurance on the
information because the limited procedures do not provide us with sufficient evidence to express an
opinion or provide any assurance.
Other Information
Our audit was conducted for the purpose of forming an opinion on the Plan’s financial statements.
The supplemental information which includes historical trend information and expense ratios are
presented for purposes of additional analysis and are not a required part of the basic financial
statements. The supplemental information is the responsibility of management and was derived from
and relates directly to the underlying accounting and other records used to prepare the basic financial
statements. The supplemental information has not been subjected to the auditing procedures applied
in the audit of the basic financial statements, and accordingly, we do not express an opinion or
provide any assurance on it.
July 6, 2016
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
DEFINED CONTRIBUTION PLAN
Page 3
MANAGEMENT’S DISCUSSION AND ANALYSIS
For The Year Ended December 31, 2015
This report consists of a series of financial statements related to The Metropolitan St. Louis Sewer
District (“the District”) Defined Contribution Plan (“the Plan”). The Statements of Fiduciary Net
Position and the Statements of Changes in Fiduciary Net Position (on pages 8 and 9) provide
information about this Plan’s net position and changes in its net position during the year. These
statements are prepared using the accrual basis of accounting.
The Management’s Discussion and Analysis of the Plan’s financial performance provides an
overview of the Plan’s financial activities for the years ended December 31, 2015 and 2014. Please
read it in conjunction with the Plan’s financial section.
FINANCIAL HIGHLIGHTS 2015
• At December 31, the Plan consisted of 286 active participants with account balances just over
$3.5M in net position.
• Total increase to the Plan’s net position (page 9) amounted to $1,056,486 consisting of Plan
contributions and other additions of $1,206,231 offset by deductions of $99,579 and net
investment loss of $50,166.
• Administrative expenses (part of the deductions to the Plan’s net position) totaled $40,141.
This consisted of Vanguard record-keeping and compliance testing and accounting fees.
FINANCIAL HIGHLIGHTS 2014
• At December 31, the Plan consisted of 251 active participants with account balances just
under $2.5M in net position.
• Total increase to the Plan’s net position (page 9) amounted to $942,801 consisting of Plan
contributions and other additions of $907,020 and net investment income of $134,513 offset
by deductions of $98,732.
• Administrative expenses (part of the deductions to the Plan’s net position) totaled $31,170.
This consisted of Vanguard record-keeping and compliance testing.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
DEFINED CONTRIBUTION PLAN
Management’s Discussion And Analysis (Continued)
Page 4
ANALYSIS OF FINANCIAL ACTIVITIES
• The Plan showed a positive net change of $95,795 when compared to original costs. The 500
Index Fund had the greatest gain in value for any one individual fund at $19,585. The group
of Vanguard Target Retirement Funds, in the aggregate, had a gain in value of $38,259.
These funds also make up 72% of the value in the Plan. See the chart below for the change in
the value for each fund compared to the fund’s cost.
Value at
December 31, Net % of Current
Fund Name Cost 2015 Change Value
Vanguard Group, Inc.
500 Index Fund 131,062$ 150,647$ 19,585$ 4.30 %
Small-Cap Index Fund 127,090 143,474 16,384 4.09
Mid-Cap Index Fund 109,270 125,267 15,997 3.58
Target Retirement 2045 Fund 694,120 708,674 14,554 20.23
Target Retirement 2040 Fund 375,446 386,935 11,489 11.04
Target Retirement 2050 Fund 372,889 383,573 10,684 10.95
Balanced Index Fund 69,194 74,299 5,105 2.12
U.S. Growth Fund 81,028 83,643 2,615 2.39
Target Retirement 2025 Fund 243,385 245,728 2,343 7.01
Target Retirement 2030 Fund 127,901 129,400 1,499 3.69
Target Retirement 2020 Fund 79,107 80,526 1,419 2.30
Target Retirement 2035 Fund 331,916 332,322 406 9.49
International Growth Fund 74,390 74,516 126 2.13
Retirement Savings Trust 80,329 80,329 — 2.29
Prime Money Market Fund 143,266 143,266 — 4.09
Target Retirement 2015 Fund 3,865 3,844 (21) 0.11
Target Retirement 2010 Fund 1,569 1,491 (78) 0.04
Target Retirement Income Fund 29,264 28,836 (428) 0.82
Total Bond Market Index Fund 49,385 48,475 (910) 1.38
Target Retirement 2060 Fund 33,463 32,456 (1,007) 0.93
Windsor II Fund 57,098 55,732 (1,366) 1.59
Target Retirement 2055 Fund 192,719 190,118 (2,601) 5.43
Totals 3,407,756$ 3,503,551$ 95,795$ 100.00 %
Change in Fund Asset Values - 2015
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
DEFINED CONTRIBUTION PLAN
Management’s Discussion And Analysis (Continued)
Page 5
Value at
December 31, Net % of Current
Fund Name Cost 2014 Change Value
Vanguard Group, Inc.
Target Retirement 2045 Fund 437,351$ 491,848$ 54,497$ 20.11 %
Target Retirement 2040 Fund 231,870 261,955 30,085 10.71
Target Retirement 2050 Fund 215,042 242,228 27,186 9.90
Small-Cap Index Fund 94,287 118,761 24,474 4.85
500 Index Fund 106,567 130,815 24,248 5.35
Target Retirement 2035 Fund 247,891 271,464 23,573 11.09
Mid-Cap Index Fund 67,620 88,252 20,632 3.61
Target Retirement 2025 Fund 156,847 173,705 16,858 7.10
Target Retirement 2030 Fund 79,755 87,612 7,857 3.58
Balanced Index Fund 41,256 47,528 6,272 1.94
Target Retirement 2020 Fund 56,815 62,470 5,655 2.55
Target Retirement 2055 Fund 90,664 96,044 5,380 3.92
U.S. Growth Fund 42,037 47,401 5,364 1.94
Windsor II Fund 41,387 46,105 4,718 1.88
International Growth Fund 53,793 56,396 2,603 2.30
Target Retirement Income Fund 15,142 15,774 632 0.64
Target Retirement 2060 Fund 11,117 11,480 363 0.47
Target Retirement 2015 Fund 5,395 5,727 332 0.23
Target Retirement 2010 Fund 904 913 9 0.04
Total Bond Market Index Fund 35,815 35,816 1 1.46
Retirement Savings Trust 55,017 55,017 — 2.25
Prime Money Market Fund 99,754 99,754 — 4.08
Totals 2,186,326$ 2,447,065$ 260,739$ 100.00 %
Change in Fund Asset Values - 2014
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
DEFINED CONTRIBUTION PLAN
Management’s Discussion And Analysis (Continued)
Page 6
INVESTMENT ASSET ALLOCATION
• Investment decisions are participant directed. The participants are offered a diversified
portfolio of investment options from which to select. These investment options represent a
series of mutual funds sponsored and managed by the Vanguard Group. A breakdown of the
participant directed assets allocation as of December 31, 2015 follows:
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
DEFINED CONTRIBUTION PLAN
Management’s Discussion And Analysis (Continued)
Page 7
Percent
Change
Contributions and Other Additions 1,206,231$ 907,020$ 33%
Net Investment Income (Loss )(50,166) 134,513 -137%
Total Additions 1,156,065$ 1,041,533$ 11%
Percent
Change
Distributions to Participants 58,463$ 62,562$ -7%
Administrative Expenses and Legal Fees 41,116 36,170 14%
Total Deductions 99,579$ 98,732$ 1%
Percent
Change
Net Increase 1,056,486$ 942,801$ 12%
Net Position Restricted for Benefits, January 1 2,447,065 1,504,264 63%
Net Position Restricted for Benefits, December 31 3,503,551$ 2,447,065$ 43%
2015 2014
Plan Additions, Deductions, and Net Position are as follows:
Plan Additions
Plan Deductions
Net Position
20142015
2015 2014
FIDUCIARY RESPONSIBILITIES
The Board of Trustees and senior management are fiduciaries of the Plan and Trust. Fiduciaries are
charged with the responsibility of assuring that the assets of the Plan are used exclusively for the
benefit of plan participants and their beneficiaries.
REQUEST FOR INFORMATION
This financial report is designed to provide the Board of Trustees, participants, investment managers,
and other interested parties with an overview of the Plan’s finances and accountability for the money
received. Questions concerning any of the information provided in this report or requests for
additional information should be addressed to:
Tim Snoke, Secretary-Treasurer
The Metropolitan St. Louis Sewer District
2350 Market Street
St. Louis, MO 63103-2555
E-mail: tsnoke@stlmsd.com
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
DEFINED CONTRIBUTION PLAN
See the accompanying notes to financial statements. Page 8
STATEMENTS OF FIDUCIARY NET POSITION
2015 2014
ASSETS
Investments at Fair Value:
Mutual Funds 3,423,222$ 2,392,048$
Investments at Contract Value:
Common/Collective Trust 80,329 55,017
Total Investments 3,503,551 2,447,065
NET POSITION RESTRICTED FOR PLAN BENEFITS 3,503,551$ 2,447,065$
December 31,
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
DEFINED CONTRIBUTION PLAN
See the accompanying notes to financial statements. Page 9
STATEMENTS OF CHANGES IN FIDUCIARY NET POSITION
2015 2014
ADDITIONS TO NET POSITION ATTRIBUTED TO:
Investment Income:
Interest and Dividends on Investments 105,095$ 49,328$
Net Appreciation (Depreciation) in Fair Value of Investments (151,107) 88,000
Total Investment Income (Loss) (46,012) 137,328
Less - Investment Managers' and Advisors' Fees 4,154 2,815
Net Investment Income (Loss) (50,166) 134,513
Contributions and Other Additions:
Employer Contributions 1,160,961 868,036
Plan Expenses Paid by Employer 45,270 38,984
Total Contributions and Other Additions 1,206,231 907,020
Total Additions 1,156,065 1,041,533
DEDUCTIONS FROM NET POSITION ATTRIBUTED TO:
Distributions to Participants and Beneficiaries 58,463 62,562
Administrative Expenses 40,141 31,170
Legal Fees 975 5,000
Total Deductions 99,579 98,732
NET INCREASE 1,056,486 942,801
NET POSITION RESTRICTED FOR PLAN BENEFITS, January 1 2,447,065 1,504,264
NET POSITION RESTRICTED FOR PLAN BENEFITS, December 31 3,503,551$ 2,447,065$
For The Years
Ended December 31,
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
DEFINED CONTRIBUTION PLAN
Page 10
NOTES TO FINANCIAL STATEMENTS
December 31, 2015 And 2014
1. Summary of Significant Accounting Policies
The following significant accounting policies, which conform to generally accepted
accounting principles, have been used consistently in the preparation of The Metropolitan St.
Louis Sewer District Defined Contribution Plan’s (“the Plan”) financial statements.
Basis of Accounting
The financial statements of the Plan are prepared under the accrual basis of accounting.
Estimates and Assumptions
The preparation of financial statements in conformity with U.S. generally accepted accounting
principles requires the Plan Administrator to make certain estimates and assumptions that
affect the reported amounts in the financial statements. Actual results could differ from those
estimates.
Investment Valuation and Income Recognition
The Plan’s investments in mutual funds are stated at fair value. Shares of registered
investment companies are valued at quoted market prices which represent the net asset value
of shares held by the Plan at year-end. Units of the Retirement Savings Trust are valued at
contract value.
Purchases and sales of investments are recorded on a trade-date basis. Interest income is
accrued when earned. Dividend income is recorded on the ex-dividend date. Capital gain
distributions are included in dividend income. Realized gains of $13,839 and $27,882 are
included in net appreciation (depreciation) in fair value of investments for the periods ended
December 31, 2015 and 2014, respectively.
Payment of Benefits
Benefits are recorded when paid.
Subsequent Events
Management has evaluated subsequent events through July 6, 2016, the date through which
the financial statements were available for issue.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
DEFINED CONTRIBUTION PLAN
Notes To Financial Statements (Continued)
Page 11
2. Description of the Plan
The following description of the Plan provides only general information. Participants should
refer to the Plan agreement for a more complete description of the Plan’s provisions.
General
The Plan is a defined contribution plan established by the District’s Board of Trustees through
Ordinance 13180 and became effective January 1, 2011. The following employees are
eligible to participate in the Plan: (i) employees first hired on or after January 1, 2011, and (ii)
employees hired prior to January 1, 2011 who elected to terminate participation in The
Metropolitan St. Louis Sewer District Employees’ Pension Plan, effective as of April 1, 2011,
in accordance with the provisions of such Pension Plan, and (iii) employees rehired on or after
January 1, 2011 who are not eligible to accrue benefits under The Metropolitan St. Louis
Sewer District Employees’ Pension Plan. An employee shall become a participant in the Plan
on the first day on which he performs an hour of service for the District.
The District’s Board of Trustees, primarily to improve benefits to members, amends the Plan
in all its respects. A pension committee consisting of two members of the District’s Board of
Trustees, two elected employee members and four members of the District’s management
staff administer the Plan. A committee of the District’s Board of Trustees, with the aid of an
investment advisor, reviews and evaluates the Plan’s investments and the related rates of
return on a periodic basis.
The Plan is intended to provide a means whereby the District may provide retirement benefits
to eligible employees and encourage such employees to establish a regular method of savings,
thereby providing a measure of financial security for such employees and their beneficiaries
upon retirement or in the event of death or disability.
All assets of the Plan are the sole property of the Plan and are not subject to the claims of
creditors of the District. The Plan Administrator issues a publicly available Summary Plan
Description. That information may be obtained by writing to The Metropolitan St. Louis
Sewer District, 2350 Market Street, St. Louis, MO 63103-2555.
Contributions
Employer Basic Contributions. For each payroll period, the District contributes an amount
equal to 7% of the covered compensation earned during such period by each participant
entitled to an allocation of such contribution.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
DEFINED CONTRIBUTION PLAN
Notes To Financial Statements (Continued)
Page 12
Employer Matching Contributions. For each payroll period, the District contributes an
amount equal to 50% of the covered compensation of such participant withholding as an
annual deferral (as defined in The Metropolitan St. Louis Sewer District Deferred
Compensation Plan and Trust) pursuant to The Metropolitan St. Louis Sewer District
Deferred Compensation Plan and Trust; provided that, before-tax contributions in excess of
4% of the covered compensation of the participant for the payroll period shall not be
considered for purposes of Employer Matching Contributions. Employer Matching
Contributions shall be up to the maximum amount of compensation that may be taken into
account for the Plan year.
In no event shall the sum of the employer contributions and employee contributions allocated
to the account of a participant for the Plan year exceed the lesser of:
(a) The amount specified in the applicable Internal Revenue Code (“the Code”), as
adjusted annually for any applicable increases in the cost of living.
(b) 100% of the participant’s compensation for such year.
The compensation limit referred to in (b) shall not apply to any contribution from medical
benefits after separation from service.
Participant Accounts
The Plan Administrator shall establish and maintain a separate individual account for each
participant (which may consist of various sub-accounts established by the Plan Administrator)
to reflect the participant’s share of contributions made and the income, loss, appreciation and
depreciation attributable to the account. The Plan Administrator shall keep accurate records
of all contributions, receipts, investment distributions and all other transactions. The amount
credited to the individual account of a participant from time to time as of the most recent
valuation date shall constitute the entire interest of the participant in the Plan.
Vesting
As of any time before the normal retirement age of a participant (other than upon death or
permanent disability), the vested percentage of the amounts credited to the Participant’s
Employer Basic Contributions Account shall be determined in accordance with the following
schedule:
Months of Service Vested Percentages
Less than 12 0%
12 but less than 24 20%
24 but less than 36 40%
36 but less than 48 60%
48 but less than 60 80%
60 100%
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
DEFINED CONTRIBUTION PLAN
Notes To Financial Statements (Continued)
Page 13
Normal retirement age is defined as the first day of the month coinciding with or next
following a person’s 65th birthday and completion of 60 months of continuous service. The
amount credited to the Employer Matching Contributions Account shall be fully vested at all
times.
Investment Options
Upon enrollment in the Plan, a participant directs employer contributions in any of the
investment options available. The investment options consist of mutual funds and a
common/collective trust fund. Employer contributions may be allocated to the Vanguard
accounts, in 1% increments, as the participant directs.
Vanguard offers participants in the Plan the following investment options:
Equity option: Vanguard Windsor II Fund, Vanguard 500 Index Fund, and Vanguard
U.S. Growth Fund - Investment objective is long-term capital appreciation.
Diversification option: Vanguard Small-Cap Index Fund, Vanguard Mid-Cap Index
Fund, and Vanguard International Growth Fund - Investment objective is long-term
capital appreciation.
Bond option: Vanguard Total Bond Market Index Fund - Investment objective is
income stability and conservation of principal.
Balanced option: Vanguard Balanced Index Fund - Investment objective is income,
conservation of principal and long-term growth.
Stable Value option: Vanguard Retirement Savings Trust - Investment objective is
income stability and conservation of principal.
Money Market option: Vanguard Prime Money Market Fund - Investment objective is
income while maintaining safety of principal.
Target Retirement option: Vanguard Target Retirement 2010-2060 Funds and
Vanguard Target Retirement Income Fund - Investment objective is capital
appreciation and current income consistent with its current asset allocation.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
DEFINED CONTRIBUTION PLAN
Notes To Financial Statements (Continued)
Page 14
Distributions
Upon a participant’s severance from service, the amount credited to his/her individual account
shall be payable to the extent such that it is vested. The value of a participant’s vested
individual account balance shall be distributed as soon as administratively feasible. The
amount payable to a participant shall be the vested amount credited to his/her individual
account as of the valuation date immediately preceding such distribution. This amount shall
be distributed in any one or a combination of the following forms as the participant may elect:
(a) In one lump sum payment; or
(b) In annual, quarterly or monthly installments.
Forfeited Accounts
Upon a participant’s severance from service, the unvested amount credited to his/her
individual account shall be forfeited and credited to the Employer Basic Contributions
account and shall be used to reduce Employer Basic Contributions. If a participant is rehired
before incurring two consecutive years break in service, the amount previously forfeited will
be restored. If rehired after two consecutive years of break in service, the amounts previously
forfeited will not be restored.
Administrative Expenses
The general administrative expenses of the Plan are paid by the District. These expenses
consist of legal and accounting expenses as well as the administration of the Plan. Expenses
attributable to a participant’s choice of optional investments or optional forms of benefit
payments are charged to the respective participant’s account balance.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
DEFINED CONTRIBUTION PLAN
Notes To Financial Statements (Continued)
Page 15
3. Investments
Investment Balances
Investments held by custodians in the Plan’s name are as follows:
Mutual Funds:2015 2014
Vanguard Group, Inc.
Target Retirement 2045 Fund 708,674$ * 491,848$ *
Target Retirement 2040 Fund 386,935 * 261,955 *
Target Retirement 2050 Fund 383,573 * 242,228 *
Target Retirement 2035 Fund 332,322 * 271,464 *
Target Retirement 2025 Fund 245,728 * 173,705 *
Target Retirement 2055 Fund 190,118 * 96,044
500 Index Fund 150,647 130,815 *
Small-Cap Index Fund 143,474 118,761
Prime Money Market Fund 143,266 99,754
Target Retirement 2030 Fund 129,400 87,612
Mid-Cap Index Fund 125,267 88,252
U.S. Growth Fund 83,643 47,401
Target Retirement 2020 Fund 80,526 62,470
International Growth Fund 74,516 56,396
Balanced Index Fund 74,299 47,528
Windsor II Fund 55,732 46,105
Total Bond Market Index Fund 48,475 35,816
Target Retirement 2060 Fund 32,456 11,480
Target Retirement Income Fund 28,836 15,774
Target Retirement 2015 Fund 3,844 5,727
Target Retirement 2010 Fund 1,491 913
Total Mutual Funds 3,423,222 2,392,048
Common/Collective Trust:
Vanguard Group, Inc.
Retirement Savings Trust 80,329 55,017
Total Investments 3,503,551$ 2,447,065$
December 31,
* Represents 5% or more of the Plan’s net position as of December 31, 2015 or 2014, respectively.
Categories of Asset Risk - Debt Securities Interest Rate and Credit Risk
The Plan will minimize the risk that the market value of securities in the portfolio will fall due
to changes in general interest rates by selecting mutual funds for the investment portfolio that
manage credit quality and duration of fixed income investments.
The Plan will minimize credit risk, the risk of loss due to failure of the security issuer or
backer, by selecting mutual funds for the investment portfolio that manage their respective
fund under a predetermined average credit risk investment management policy.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
DEFINED CONTRIBUTION PLAN
Notes To Financial Statements (Continued)
Page 16
The following tables provide information on the duration and credit ratings associated with
the Plan’s investment in debt-backed mutual funds, excluding obligations of the U.S.
Government or obligations explicitly guaranteed by the U.S. Government within these funds
at December 31, 2015 and 2014:
Average
Effective
Debt-Backed Fair Not Duration
Plan Investments Value Rated in Years
December 31, 2015:
Vanguard Group, Inc.
Target Retirement 2045 Fund 708,674$ yes 6.24
Target Retirement 2035 Fund 332,322 yes 6.23
Target Retirement 2040 Fund 386,935 yes 6.23
Target Retirement 2050 Fund 383,573 yes 6.24
Target Retirement 2025 Fund 245,728 yes 6.24
Target Retirement 2055 Fund 190,118 yes 6.24
Prime Money Market Fund 143,266 yes *
Target Retirement 2030 Fund 129,400 yes 6.24
Target Retirement 2020 Fund 80,526 yes 6.17
Retirement Savings Trust 80,329 yes *
Balanced Index Fund 74,299 yes 5.79
Total Bond Market Index Fund 48,475 yes 5.79
Target Retirement Income Fund 28,836 yes 5.43
Target Retirement 2060 Fund 32,456 yes 6.24
Target Retirement 2015 Fund 3,844 yes 5.68
Target Retirement 2010 Fund 1,491 yes 5.47
* Information is unavailable for this security.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
DEFINED CONTRIBUTION PLAN
Notes To Financial Statements (Continued)
Page 17
Average
Effective
Debt-Backed Fair Not Duration
Plan Investments Value Rated in Years
December 31, 2014:
Vanguard Group, Inc.
Target Retirement 2045 Fund 491,848$ yes 5.86
Target Retirement 2035 Fund 271,464 yes 5.85
Target Retirement 2040 Fund 261,955 yes 5.85
Target Retirement 2050 Fund 242,228 yes 5.85
Target Retirement 2025 Fund 173,705 yes 5.84
Target Retirement 2055 Fund 96,044 yes 5.86
Prime Money Market Fund 99,754 yes 0.27
Target Retirement 2030 Fund 87,612 yes 5.85
Target Retirement 2020 Fund 62,470 yes 5.84
Retirement Savings Trust 55,017 yes 2.50
Balanced Index Fund 47,528 yes 5.66
Total Bond Market Index Fund 35,816 yes 5.50
Target Retirement Income Fund 15,774 yes 5.18
Target Retirement 2060 Fund 11,480 yes 5.85
Target Retirement 2015 Fund 5,727 yes 5.42
Target Retirement 2010 Fund 913 yes 5.24
4. Risks and Uncertainties
The Plan invests in various investment securities as directed by the Plan’s participants.
Investment securities are exposed to various risks such as interest rate, market, and credit risk.
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 change could materially affect the participants’ account balances and amounts
reported in the Plan’s Statements of Fiduciary Net Position.
5. Plan Termination
Although it has not expressed any intent to do so, the District has the right under the Plan to
terminate the Plan at any time. In the event of Plan termination, the Trustee shall liquidate the
assets and disburse all funds to participants or their beneficiaries.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
DEFINED CONTRIBUTION PLAN
Notes To Financial Statements (Continued)
Page 18
6. Related Party Transactions
The Plan invests in shares of mutual funds managed by an affiliate of Vanguard Fiduciary
Trust Company (“VFTC”). VFTC acts as trustee for only those investments as defined by the
Plan. Transactions in such investments qualify as related party transactions which are exempt
from the prohibited transaction rules.
7. Tax Status
The Plan received a favorable determination letter from the Internal Revenue Service (“the
IRS”) on May 21, 2014, in which the IRS stated that the Plan, as then designed, was in
compliance with the applicable requirements of the Code.
SUPPLEMENTAL INFORMATION
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
DEFINED CONTRIBUTION PLAN
See the accompanying independent auditors’ report. Page 19
HISTORICAL TREND INFORMATION
Employer Distributions To
For The Contributions And Participants Increase
Years Ended Expenses Paid Net Investment And Plan (Decrease)
December 31, By Employer Income (Loss) Expenses In Net Position
2015 1,206,231$ (50,166)$ 99,579$ 1,056,486$
2014 907,020 134,513 98,732 942,801
2013 678,967 204,824 27,154 856,637
2012 420,158 44,390 20,642 443,906
2011 239,482 (5,193) 30,568 203,721
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
DEFINED CONTRIBUTION PLAN
See the accompanying independent auditors’ report. Page 20
FUND VALUES AND EXPENSE RATIOS
This asset-based fee is a measure of what it costs an investment company to operate a mutual fund. An
expense ratio is determined through an annual calculation, where a fund's operating expenses are divided
by the average dollar value of its assets under management. Operating expenses are taken out of a fund's
assets, lowering the return in the fund. Lower expense ratios reduce fees coming out of a fund, thus
increasing the fund’s rate of return to the participant. The listing below shows all funds and their asset
value with their corresponding expense ratio.
Value at
December 31,
Fund Name 2015
Vanguard Group, Inc.
Target Retirement 2045 Fund 708,674$ 0.18 %
Target Retirement 2040 Fund 386,935 0.18
Target Retirement 2050 Fund 383,573 0.18
Target Retirement 2035 Fund 332,322 0.18
Target Retirement 2025 Fund 245,728 0.17
Target Retirement 2055 Fund 190,118 0.18
500 Index Fund 150,647 0.17
Small-Cap Index Fund 143,474 0.23
Prime Money Market Fund 143,266 0.16
Target Retirement 2030 Fund 129,400 0.17
Mid-Cap Index Fund 125,267 0.23
U.S. Growth Fund 83,643 0.47
Target Retirement 2020 Fund 80,526 0.16
Retirement Savings Trust 80,329 0.53
International Growth Fund 74,516 0.47
Balanced Index Fund 74,299 0.23
Windsor II Fund 55,732 0.34
Total Bond Market Index Fund 48,475 0.20
Target Retirement 2060 Fund 32,456 0.18
Target Retirement Income Fund 28,836 0.16
Target Retirement 2015 Fund 3,844 0.16
Target Retirement 2010 Fund 1,491 0.16
Vanguard Total/Average Ratio 3,503,551$ 0.23 %
Expense
Ratio