American Stores Company and Subsidiaries - Page 12

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               As required by ERISA sections 104 and 4065, 88 Stat. 847,              
          1032, and sections 6057(b) and 6058(a), after the close of each             
          plan year the administrator of each CBA Plan filed Annual Reports           
          (Forms 5500) and accompanying schedules with the IRS.  On                   
          Schedule B of Form 5500, each CBA Plan reported for its plan year           
          only those contributions paid under the applicable agreement for            
          units of service worked during that particular year.  Only a                
          defined benefit plan subject to the minimum funding standards of            
          section 412 and ERISA section 302, 88 Stat. 869, is required to             
          file a Schedule B.  One purpose of the completion of the Schedule           
          B is to demonstrate compliance or noncompliance with such minimum           
          funding standards.  At all times during the relevant periods,               
          each CBA Plan satisfied the minimum funding requirements of                 
          section 412 and ERISA section 302.  Petitioner's subsidiaries'              
          monthly contributions to each CBA Plan were reported on Schedule            
          B for that plan year in which the related units of service of the           
          covered employees had been worked.                                          
               While nothing in the collective bargaining agreements                  
          prohibited petitioner from contributing more than the amount                
          required, or contributing amounts in advance of the date that               
          such amounts became due, no provision explained how the plan                
          administrator should credit an advance contribution from an                 
          employer.  Generally, advance pension contributions were not made           

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Last modified: May 25, 2011