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 Period of February 1, 1996 - December 31, 1996
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the Transition Period from ____ to _________________
Commission file number 1-3523
A. Full title of the Plan:
WESTAR SECURITY SERVICES, INC.
401(K) PROFIT SHARING PLAN
B. Name of issuer of the securities held
pursuant to the plan and the address
of its principal executive office:
WESTERN RESOURCES, INC.
818 Kansas Avenue
Topeka, Kansas 66612
EIN: 48-1123483
PN: 001
WESTAR SECURITY SERVICES, INC.
401(K) PROFIT SHARING PLAN
FINANCIAL STATEMENTS FOR THE PERIOD
FROM INCEPTION THROUGH DECEMBER 31, 1996
TOGETHER WITH REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
Report of Independent Public Accountants
To the Investment and Benefits Committee of
Westar Security Services, Inc. 401(k) Profit Sharing Plan:
We have audited the accompanying statement of net assets available for benefits
of WESTAR SECURITY SERVICES, INC. 401(K) PROFIT SHARING PLAN as of December 31,
1996, the related statement of changes in net assets available for benefits for
the period from inception through December 31, 1996. These financial statements
and the schedules referred to below are the responsibility of the Plan's
management. Our responsibility is to express an opinion on these financial
statements and schedules based on our audits.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides 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, 1996, and the changes in net assets available for benefits for the
period from inception through December 31, 1996, in conformity with generally
accepted accounting principles.
Our audit was made for the purpose of forming an opinion on the basic financial
statements taken as a whole. The supplemental schedules of assets held for
investment purposes as of December 31, 1996 and reportable transactions for the
period then ended are presented for the purpose of additional analysis and are
not a required part of the basic financial statements, but are supplementary
information required by the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. The supplemental schedules have been subjected to the auditing procedures
applied in the audits of the basic financial statements and, in our opinion, are
fairly stated in all material respects in relation to the basic financial
statements taken as a whole.
Kansas City, Missouri,
June 20, 1997
EIN: 48-1123483
PN: 001
WESTAR SECURITY SERVICES, INC.
401(K) PROFIT SHARING PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1996
ASSETS
INVESTMENTS:
Vanguard Windsor Fund $ 39,225
Western Resources, Inc. Common
Stock Fund 50,959
Vanguard Wellington Fund 15,176
Vanguard Index Trust 500 Portfolio Fund 20,619
Vanguard PRIMECAP Fund 17,810
Fidelity Magellan Fund 20,330
Vanguard Investment Contract Fund 543
Vanguard Money Market Reserves, Prime Portfolio 303
Loan Fund 484
--------
Total Investments 165,449
DIVIDENDS RECEIVABLE 1,111
NET ASSETS AVAILABLE FOR BENEFITS $166,560
Theaccompanying notes to financial statements
are an integral part of these statements.
EIN: 48-1123483
PN: 001
WESTAR SECURITY SERVICES, INC.
401(K) PROFIT SHARING PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE PERIOD FROM INCEPTION THROUGH DECEMBER 31, 1996
NET ASSETS AVAILABLE FOR
BENEFITS, beginning of period $ -
ADDITIONS:
INVESTMENT INCOME-
Net Appreciation in Fair
Value of Investments 5,973
Interest 565
Dividends 9,692
--------
Total Investment Income 16,230
PARTICIPANT CONTRIBUTIONS 45,190
Total Additions 61,420
DEDUCTIONS:
BENEFITS PAID (2,697)
OTHER (150)
Total Deductions (2,847)
TRANSFERS:
TRANSFERS FROM OTHER PLANS 107,987
NET INCREASE 166,560
NET ASSETS AVAILABLE FOR
BENEFITS, end of period $166,560
Theaccompanying notes to financial statements
are an integral part of these statements.
WESTAR SECURITY SERVICES, INC.
401(K) PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1996
(1) PLAN DESCRIPTION:
The following brief description of the Westar Security Services, Inc. 401(k)
Profit Sharing Plan (the Plan) is provided for general information purposes
only. Participants should refer to the plan document for more complete
information.
(a) General--In 1995, Western Resources, Inc. (WRI) acquired two
security service providers, Mobilfone Security of Topeka and
Communications & Signaling, Inc. (CSI), which together formed the WRI
subsidiary, Westar Security Services, Inc. (the Company). This defined
contribution plan was established for employees of the Company
effective February 1, 1996.
All employees, except part-time employees, are eligible to participate
in the Plan after ninety days of service. The Plan is subject to the
provisions of the Employee Retirement Income Security Act of 1974
(ERISA), as amended.
(b) Contributions--Participants are allowed to make elective deferral
contributions of between 1% and 14% of taxable wages subject to certain
Internal Revenue Code limits. These contributions effectively reduce a
participant's taxable wages because they are withheld from earnings on
a pre-tax basis. An employee may transfer a qualifying rollover
distribution to the Trustee under the Plan subject to terms and
conditions of the Plan.
The Company may make qualified nonelective employer contributions or
regular employer contributions at its discretion. In order to share in
either employer contribution, the eligible employee must be an employee
of the Company on the last day of the Plan year and must have completed
1,000 hours of service during the Plan year.
Participants are fully vested in elective deferral contributions,
qualified nonelective employer contributions, and amounts representing
qualifying rollover distributions.
(c) Investment Funds--Participants may elect to have their
contributions and the Company's qualified non-elective contributions
invested in the funds listed below, excluding the Loan Fund.
The Vanguard Investment Contract Trust seeks to preserve the value of
an investment and provide an attractive level of interest by investing
in investment contracts issued by financial institutions and in
contracts backed by high-quality bonds and bond mutual funds.
The Vanguard/Windsor Fund is a diversified equity fund invested in
equity securities providing dividend and capital appreciation income.
The Vanguard Money Market Reserves, Prime Portfolio is a money market
fund invested in commercial paper and certificates of deposit.
The Western Resources, Inc. Common Stock Fund provides the possibility
of long-term growth through increases in the value of the stock and the
reinvestment of its dividends. A portion of the fund may also be
invested in cash reserves, such as money market instruments, to
accommodate daily transactions.
The Loan Fund is a conduit for the distribution and repayment of loan
proceeds. The investments in the fund represent loans due from
participants.
The Vanguard/Wellington Fund is a balanced fund which invests in stocks
for potential capital growth and dividend income and in bonds for
current income potential and conservation of principal.
The Vanguard Index Trust-500 Portfolio is a growth and income fund
which seeks to provide long-term capital growth. The Vanguard Index
Trust-500 Portfolio attempts to provide investment results that
correspond to the price and yield performance of publicly traded
stocks, in the aggregate, as represented by the Standard & Poor's
Composite Stock Price Index.
The Vanguard/PRIMECAP Fund is a growth fund seeking long-term growth of
capital by investing principally in a portfolio of common stocks.
The Fidelity Magellan Fund is a diversified equity fund invested in
equity securities providing long-term capital appreciation.
The above funds are managed by Vanguard Fiduciary Trust Company except
the Fidelity Magellan Fund which is managed by Fidelity Investments
Institutional Services Company. All investments are stated at quoted
market values, except as follows. Investments in Vanguard Investment
Contract Trust and Vanguard Money Market Reserves, Prime Portfolio are
stated at cost which approximates market value as determined by
Vanguard Fiduciary Trust Company. Investments in the Loan Fund are
stated at face value.
(d) Loans to Participants--In accordance with Plan provisions
participants are permitted to borrow a specified portion of the vested
balances in their individual accounts. Loans are evidenced by
promissory notes payable to the Plan.
(e) Income Taxes--The Plan has not yet obtained a determination letter
from the Internal Revenue Service. The Plan Administrator believes that
the Plan is currently designed and being operated in compliance with
the applicable requirements of the Internal Revenue Code and,
therefore, no provision for income taxes has been included in these
financial statements.
(f) Plan Termination--The Company is free to terminate the Plan at any
time.
(2) SIGNIFICANT ACCOUNTING POLICIES:
(a) Basis of Accounting--The Plan's financial statements are maintained
on the accrual basis. Employee contributions are accrued as the
employees' salaries are earned. Upon retirement, death, disability or
termination of employment, all vested balances are paid to the
participant or his beneficiaries in accordance with Plan terms.
(b) Use of Estimates--The preparation of financial statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets
and liabilities at the date of the financial statements and the
reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
(c) Participant Accounts--A separate account is maintained for each
participant. Allocations to participant accounts for employee
contributions are made when the contributions are received by the
trustee. Allocations to participant accounts for the net of interest
dividends, realized and unrealized changes in investment market value
and Plan expenses are made when such amounts are earned or incurred.
Forfeitures arise when participants leave the Plan before any
discretionary Company contributions become fully vested. Forfeitures
are reallocated to the accounts of all participants entitled to share
in the employer contribution.
(d) Administrative Expenses--All administrative expenses of the Plan
are paid by the Company with the exception of loan administrative
charges which will be paid by the participants. The Company has no
continuing obligation to pay these expenses.
(3) ASSET TRANSFERS:
The accounts of participants who change employment status and new employees with
assets in previous employers' qualified plans are transferred into the Plan in
accordance with Plan provisions.
(4) FUND INFORMATION:
The following tables present changes in net assets available for benefits in
fund detail for December 31, 1996.
(4) Fund Information (continued):
Period Ended December 31, 1996
Money Company
Investment Market Common
Contract Windsor Reserves Stock Loans
ADDITIONS
Investment Income:
Net appreciation
(depreciation) in fair
value of investments $ - $ 2,181 $ - $ 602 $ -
Interest 13 - 30 505 17
Dividends - 3,660 - 734 -
---------- ---------- ---------- ---------- -----
13 5,841 30 1,841 17
---------- ---------- ---------- ---------- --------
Participant Contributions 530 7,862 580 15,562 -
---------- ---------- ---------- ---------- -----
Total additions 543 13,703 610 17,403 17
---------- ---------- ---------- ---------- --------
DEDUCTIONS
Benefits Paid - (12) (1,193) (420) -
Other - - - - -
---------- ---------- ---------- ---------- -----
Total deductions - (12) (1,193) (420) -
---------- ---------- ---------- ---------- -----
Net increase (decrease)
prior to transfers 543 13,691 (583) 16,983 17
TRANSFERS
Interfund Transfers - - - (370) 467
Transfers-other plans - 25,534 886 34,346 -
---------- ---------- ---------- ---------- -----
Total transfers - 25,534 886 33,976 467
---------- ---------- ---------- ---------- --------
Net Increase 543 39,225 303 50,959 484
Net assets available for benefits:
Beginning of period - - - - -
---------- --------- ---------- ---------- -----
End of period $ 543 $ 39,225 $ 303 $ 50,959 $ 484
========== ========== ========== ========== ========
(Continued)
(4) Fund Information (continued):
Period Ended December 31, 1996
Index Trust
500
Wellington Portfolio PRIMECAP Magellan
ADDITIONS
Investment Income:
Net appreciation
(depreciation) in fair
value of investments $ 427 $ 2,105 $ 1,451 $ (793)
Interest - - - -
Dividends 943 307 504 2,433
---------- --------- --------- ----------
1,370 2,412 1,955 1,640
---------- --------- --------- ----------
Participant Contributions 3,875 6,325 5,091 5,365
---------- --------- --------- ----------
Total additions 5,245 8,737 7,046 7,005
---------- --------- --------- ----------
DEDUCTIONS
Benefits paid (13) (12) (365) (682)
Other (150) - - -
---------- --------- --------- -------
Total deductions (163) (12) (365) (682)
---------- --------- --------- ----------
Net increase (decrease)
prior to transfers 5,082 8,725 6,681 6,323
TRANSFERS
Interfund transfers (97) - - -
Transfers-other plans 10,191 11,894 11,129 14,007
---------- ---------- ---------- ----------
Total transfers 10,094 11,894 11,129 14,007
---------- ---------- ---------- ----------
Net increase 15,176 20,619 17,810 20,330
Net assets available for benefits:
Beginning of period - - - -
---------- ---------- ---------- -------
End of period $ 15,176 $ 20,619 $ 17,810 $ 20,330
========== ========== ========== ==========
(4) Fund Information (continued):
Period Ended December 31, 1996
Other Total
ADDITIONS
Investment Income:
Net appreciation
(depreciation) in fair
value of investments $ - $ 5,973
Interest - 565
Dividends 1,111 9,692
---------- ---------
1,111 16,230
Participant Contributions - 45,190
---------- ---------
Total additions 1,111 61,420
---------- ---------
DEDUCTIONS
Benefits paid - (2,697)
Other - (150)
---------- ---------
Total deductions - (2,847)
---------- ---------
Net increase (decrease)
prior to transfers 1,111 58,573
TRANSFERS
Interfund Transfers - -
Transfers-other plans - 107,987
---------- ----------
Total transfers - 107,987
---------- ----------
Net increase 1,111 166,560
Net assets available for benefits:
Beginning of period - -
---------- -------
End of period $ 1,111 $ 166,560
========== ==========
EIN: 48-1123483
PN: 001
PAGE 1 of 1
WESTAR SECURITY SERVICES, INC.
401(K) PROFIT SHARING PLAN
LINE 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
DECEMBER 31, 1996
Number Current
Description of Units Cost Value
Vanguard/Windsor Fund 2,364.4049 $ 37,045 $ 39,225
Vanguard Money Market Reserves,
Prime Portfolio 303.1100 303 303
Vanguard/Wellington Fund 580.3545 14,749 15,176
Vanguard Index Trust 500 Portfolio 298.1323 18,514 20,619
Vanguard/PrimeCap Fund 592.0839 16,366 17,810
Fidelity Magellan Fund 252.0706 21,102 20,330
Vanguard Investment Contract Trust 543.0000 543 543
Participant Loan at 8.25% Interest Rate 484 484
*Western Resources, Inc. Common Stock 1,650.5087 50,296 50,959
-------- --------
Total Investments $159,402 $165,449
======== ========
*Investment with party-in-interest to the Plan.
EIN: 48-1123483
PN: 001
WESTAR SECURITY SERVICES, INC.
401(K) PROFIT SHARING PLAN
LINE 27d - SCHEDULE OF REPORTABLE TRANSACTIONS
FOR THE PERIOD ENDED DECEMBER 31, 1996
Type of Dollar Net Gain
Investment Transaction Number Value (Loss)
(1)
Magellan Fund Purchases 50 $ 21,746 $ -
Sales 3 624 (59)
Vanguard/Wellington Fund Purchases 41 14,103 -
Sales 3 298 3
Vanguard/PrimeCap Fund Purchases 49 16,600 -
Sales 3 242 4
Vanguard/Windsor Fund Purchases 46 37,057 -
Sale 1 12 -
Vanguard Investment Contract Purchases 43 547 -
Trust Sale 1 6 -
Vanguard Money Market Reserves, Purchases 75 47,459 -
Prime Portfolio Sales 25 47,164 -
Vanguard Index Trust 500 Purchases 42 18,219 -
Portfolio Sale 1 13 1
Western Resources, Inc. Purchases 27 51,958 -
Stock Fund Sales 2 815 (139)
(1) Amount shown in this column is cost of purchases or proceeds from sales.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Investment and Benefits Committee for the Westar Security Services, Inc. 401(k)
Profit Sharing Plan has duly caused this annual report to be signed on its
behalf by the undersigned hereunto duly authorized.
WESTAR SECURITY SERVICES, INC.
401(K) PROFIT SHARING PLAN
By:
Signature Title Date
S. L. Kitchen Chairman June 27, 1997
Ira W. McKee, Jr. Member June 27, 1997
John K. Rosenberg Member June 27, 1997
Kenneth T. Wymore Member June 27, 1997
David E. Roth Member June 27, 1997
EXHIBIT INDEX
Exhibit
Number Description of Documents Page
23 Consent of Independent Public Accountants (filed
electronically)
Exhibit 23
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation of
our report included in the Form 11-K for the Westar Security Services, Inc.
401(k) Profit Sharing Plan, into the Western Resources, Inc. previously filed
Registration Statements File Nos. 33-49467, 33-49553, 333-02023, 33-50069,
33-62375, and 333-26115 of Western Resources, Inc. on Form S-3; Nos. 333-18097
and 333-02711 of Western Resources, Inc. on Form S-4; Nos. 33-57435, 333-13229,
333-06887, 333-20393, and 333-20413 of Western Resources, Inc. on Form S-8.
Arthur Andersen LLP
Kansas City, Missouri,
June 20, 1997
