x
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ANNUAL
REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
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o
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TRANSITION
REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
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A.
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Full
title of the plan and the address of the plan, if different from
that of
the issuer named below:
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B.
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Name
of the issuer of the securities held pursuant to the Plan and the
address
of its principal executive office:
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Report
of Independent Registered Public Accounting Firm
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1
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Audited
Financial Statements
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Statements
of Net Assets Available for Benefits
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2
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Statements
of Changes in Net Assets Available for Benefits
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3
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Notes
to Financial Statements
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4
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Report of Independent Registered Public Accounting Firm
The Administrative Committee
ADM Employee Stock Ownership Plan
for Hourly Employees
We have audited the accompanying statements of net assets available for benefits of the ADM Employee Stock Ownership Plan for Hourly Employees as of December 31, 2004 and 2003, and the related statements of changes in net assets available for 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. We were not engaged to perform an audit of the Plan’s internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Plan’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and 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 at December 31, 2004 and 2003, and the changes in its net assets available for benefits for the years then ended, in conformity with U.S. generally accepted accounting principles.
December
31
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|||||||
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2004
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2003
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Assets
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|||||||
Interest
in Master Trust
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$
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-
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$
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78,722,918
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|||
Participant
loans receivable
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-
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191,471
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|||||
Contributions
receivable from employer
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-
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712,892
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|||||
Contributions
receivable from employees
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-
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3,414
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|||||
Net
assets available for benefits
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$
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-
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$
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79,630,695
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Year
Ended December 31
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|||||||
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2004
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2003
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Additions:
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|||||||
Contributions
from employer
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$
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7,303,958
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$
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7,070,170
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|||
Contributions
from employees
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157,526
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400,227
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|||||
Dividend
and interest income
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1,569,255
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1,223,044
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|||||
9,030,739
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8,693,441
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||||||
Deductions:
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|||||||
Benefit
payments
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(6,627,458
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)
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(3,975,905
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)
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|||
Transfer
of assets to another plan
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(1,960,363
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)
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(1,431,298
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)
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|||
Transfer
to ADM 401(k) Plan for Hourly Employees
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(117,089,234
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)
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-
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||||
(125,677,055
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)
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(5,407,203
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)
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||||
Net
realized and unrealized appreciation in fair value of common
stock
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37,015,621
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14,682,008
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|||||
Net
increase (decrease)
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(79,630,695
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)
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17,968,246
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||||
Net
assets available for benefits at beginning of year
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79,630,695
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61,662,449
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|||||
Net
assets available for benefits at end of year
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$
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-
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$
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79,630,695
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On December 31, 2004, the ADM Employee Stock Ownership Plan for Hourly Employees (the Plan) was merged into the ADM 401(k) Plan for Hourly Employees (the ADM 401(k) Plan), forming the ADM 401(k) and Employee Stock Ownership Plan for Hourly Employees. The merger combined the Plan into the ADM 401(k) Plan, with the Plan remaining a separate component of the combined plan. The merger was effective at the close of December 31, 2004, and the financial statements reflect the transfer of the Plan’s assets to the ADM 401(k) Plan. Prior to the merger, the Plan and the ADM 401(k) Plan operated in coordination as described below.
The Plan, as amended, was a defined contribution plan available to all eligible hourly employees of Archer-Daniels-Midland Company (ADM or the Company) who have completed the required service. The Plan was subject to the provisions of the Employee Retirement Income Security Act of 1974 (ERISA). Participants should refer to the plan agreement for a more complete description of the Plan’s provisions.
The Company designed the Plan to operate in cooperation with the ADM 401(k) Plan. The Plan provided eligible employees with a means to acquire ADM common stock through participant and company matching contributions. Company matching contributions were based on participant contributions to the ADM 401(k) Plan. Participants at certain Company locations were not eligible to participate in the ADM 401(k) Plan and were instead eligible to make contributions to the Plan. Employee eligibility varied by location and employment status. Employees should refer to the plan appendix applicable to their participating location for more complete information regarding employee eligibility.
Arrangement with Related Party
All plan assets were held by Hickory Point Bank & Trust, FSB (HPB), a wholly owned subsidiary of ADM, through a master trust established for the Plan and certain other ADM benefit plans (the Master Trust).
Employees of participating locations could generally contribute from 1% up to as much as 25% of their compensation, as defined by the Plan document, with the maximum determined by the participant’s location. Participant contributions for locations that participated in the Plan, which also participated in the ADM 401(K) Plan, were remitted to the ADM 401(k) Plan. Participant contributions to purchase ADM stock were remitted to the Plan.
Substantially all company contributions, as determined by location, were received in the form of ADM common stock, and all contributions immediately vested to the participant. The company match varies by location. Employees should refer to the plan appendix applicable to their participating location for more complete information regarding employee contributions and employer match limitations.
Investment Options
Participants could elect at any time to convert all or any number of the shares of ADM common stock acquired through participant and Company matching contributions to cash and have the cash transferred to the ADM 401(k) Plan to be invested in the investment options available under the ADM 401(k) Plan. Employees should refer to the plan investment materials applicable to their participating location for more complete information regarding investment options.
Eligible participants could borrow from their fund accounts a minimum of $1,000 up to the lesser of $50,000 or 50% of the participant account balance. A maximum of one loan could be outstanding to a participant at any time.
Loans were allowed only for purposes of educational or medical expenses and purchase of a primary residence. Educational or medical expense loans were available for up to five years, and home purchase loans were available for up to ten years.
Withdrawal
The full value of an employee’s account was payable following termination of employment. Withdrawals by active employees were permitted upon reaching age 59 1/2 or for specific hardship circumstances (only after receiving a loan available to the participant under the loan program).
2. Significant Accounting Policies
Basis of Accounting
The accounting records of the Plan were maintained on the accrual basis.
Investment Valuation and Income Recognition
Investments in the Master Trust are carried at fair value. Common stocks are valued at the quoted market price on the last business day of the plan year. Investments in mutual funds are stated at the reported net asset value on the last day of the plan year. Unallocated funds are invested in a short-term money market account. Participant loans are valued at cost, which approximates fair value.
Purchases and sales of securities are recorded on a trade-date basis. Interest income is recorded on the accrual basis. Dividends are recorded on the shareholder record date as declared by the related investment.
December
31
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|||||||
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|
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2004
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2003
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Assets
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|||||||
Cash
and cash equivalents
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$
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1,729,790
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$
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388,708
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|||
Investment
securities:
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|||||||
ADM
common stock
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518,606,681
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372,817,264
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|||||
Mutual
funds
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260,659,395
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195,589,426
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|||||
Other
common stock
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8,106,747
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10,516,430
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|||||
Net
assets available for benefits
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$
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789,102,613
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$
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579,311,828
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Year
Ended December 31
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|||||||
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2004
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2003
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Net
realized and unrealized appreciation (depreciation) in fair value
of
investments:
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|||||||
ADM
common stock
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$
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167,800,633
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$
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69,653,402
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|||
Mutual
funds
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17,207,198
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26,464,873
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|||||
Other
common stock
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(2,333,892
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)
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1,279,994
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||||
$
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182,673,939
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$
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97,398,269
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||||
Dividend
income
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$
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14,624,859
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$
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10,041,318
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