Exhibit 99.2
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_________
FORM 11-K
ANNUAL REPORT
PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934.
For the fiscal year ended: December 31, 1999
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934.
For the transition period from ________ to ________
Commission file number: 1-4850
A. Full title of plan and the address of the plan, if different from
that of the issuer named below: CSC Outsourcing Inc. Hourly Savings Plan
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office: Computer Sciences Corporation
2100 East Grand Avenue
El Segundo, California 90245
<PAGE>
TABLE OF CONTENTS
-----------------
Description Page
----------- ----
(a) Financial Statements:
Independent Auditors' Report......................................... 3
Statements of Net Assets Available for Benefits
As of December 31, 1999 and 1998................................... 4
Statements of Changes in Net Assets Available for Benefits
For the Years Ended December 31, 1999 and 1998..................... 5
Notes to Financial Statements........................................ 6
(b) Exhibit:
Independent Auditors' Consent........................................ E-1
(c) Supplemental Schedules:
Schedule of Assets Held for Investment Purposes...................... S-1
Schedule of Reportable Transactions.................................. S-2
2
<PAGE>
INDEPENDENT AUDITORS' REPORT
Employee Retirement Plan Committee
Computer Sciences Corporation
El Segundo, California
We have audited the accompanying statements of net assets available for
benefits of the CSC Outsourcing Inc. Hourly Savings Plan (the "Plan") as of
December 31, 1999 and 1998, 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 auditing standards generally
accepted in the United States of America. Those standards require that we
plan and perform the audits 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, such financial statements referred to above present fairly,
in all material respects, the net assets available for benefits of the Plan
as of December 31, 1999 and 1998, and the changes in net assets available for
benefits for the years then ended in conformity with accounting principles
generally accepted in the United States of America.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules listed in
Section C of the table of contents 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. These supplemental schedules are the
responsibility of the Plan's management. Such schedules have been subjected
to the auditing procedures applied in our 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.
/s/Deloitte & Touche LLP
June 16, 2000
Los Angeles, California
3
<PAGE>
CSC OUTSOURCING INC. HOURLY SAVINGS PLAN
STATEMENTS OF NET ASSETS
AVAILABLE FOR BENEFITS
<TABLE>
<CAPTION>
December 31,
---------------------------------
1999 1998
-------------- --------------
<S> <C> <C>
ASSETS
Investments (Notes 2, 5, 8 and 9):
Short-term $ 10,105 $ 14,587
Long-term--at fair value
Mellon Capital Government Bond Fund 871,396 981,182
Brinson U.S. Equity Fund 1,226,663 1,591,617
CSC Stock Fund 902,723 666,915
Employee loans (Note 6) 11,670 13,983
Interest in Master Trust (Note 5) 1,818,792 1,906,881
---------- ----------
Total investments 4,841,349 5,175,165
---------- ----------
Receivables:
Participants' contributions 2,690 2,129
Employer contributions 6,047 1,412
Other 32,464 10,683
---------- ----------
Total receivables 41,201 14,224
---------- ----------
Total Assets 4,882,550 5,189,389
---------- ----------
LIABILITIES
Accrued expenses 1,841 3,641
Other 3,232 13,579
---------- ----------
Total Liabilities 5,073 17,220
---------- -----------
NET ASSETS AVAILABLE FOR BENEFITS $4,877,477 $5,172,169
========== ==========
</TABLE>
See notes to financial statements
4
<PAGE>
CSC OUTSOURCING INC. HOURLY SAVINGS PLAN
STATEMENTS OF CHANGES IN NET ASSETS
AVAILABLE FOR BENEFITS
<TABLE>
<CAPTION>
For the Years Ended
December 31,
---------------------------------
1999 1998
-------------- --------------
<S> <C> <C>
ADDITIONS
Investment Income:
Net appreciation in fair value of
investments $ 87,154 $ 378,557
Interest 27,795 81,547
Dividends 58,511 64,841
Plan interest in Master Trust
investment income 91,977 89,229
---------- ----------
265,437 614,174
Investment management fees (7,358) (6,856)
---------- ----------
258,079 607,318
Contributions:
Employee 149,699 182,437
Employer 65,553 78,049
---------- ----------
215,252 260,486
---------- ----------
Total Additions 473,331 867,804
---------- ----------
DEDUCTIONS
Distributions to participants
(Notes 1 and 7) 768,023 765,596
---------- ----------
Total Deductions 768,023 765,596
---------- ----------
Net (Decrease) Increase (294,692) 102,208
Net assets available for benefits at
beginning of year 5,172,169 5,069,961
---------- ----------
NET ASSETS AVAILABLE FOR BENEFITS AT
END OF YEAR $4,877,477 $5,172,169
========== ==========
</TABLE>
See notes to financial statements
5
<PAGE>
CSC OUTSOURCING INC. HOURLY SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
For the Two Years Ended December 31, 1999
Note 1 Description of the Plan
-----------------------
The following brief description of the CSC Outsourcing Inc. Hourly Savings
Plan (the "Plan"), formerly the TMD Hourly Savings Plan, of CSC Outsourcing
Inc. (the "Company") is provided for general information purposes only.
Participants should refer to the Plan document for more complete information.
The Plan became effective May 2, 1992, as a result of the Company acquiring
the Data Systems Division of General Dynamics Corporation. The Plan is
administered by a committee consisting of four members who are appointed by
the Board of Directors of the Company and serve without compensation, being
reimbursed by the Company for all expenditures incurred in the discharge of
their duties as members of the committee. The committee has the power to
interpret, construe and administer the Plan and to decide any dispute which
may arise under the Plan. The Bank of New York (the "Trustee") administers
the Plan pursuant to a Trust Agreement entered into with the Company. Certain
administrative expenses (including Trustee fees) incurred for services
rendered to the Plan are paid by the Company.
The Plan is a voluntary, contributory, defined contribution plan and is
intended to satisfy the requirements of Section 401(a) and 401(k) of the
Internal Revenue Code (the "Code"). It is also subject to the provisions of
the Employee Retirement Income Security Act of 1974 ("ERISA").
The Company reserves the right to discontinue contributions and to terminate
the Plan subject to the provisions of ERISA. Upon such termination, the
participants' rights to the Company's contributions vest immediately and the
account balances are fully paid to the participants.
Eligibility and Participation
-----------------------------
Employees are eligible to participate on specified enrollment dates if they
satisfy the Plan's service requirements, are hourly paid employees of CSC
Outsourcing Inc. and are members of a collective bargaining unit for which
participation in this Plan has been provided by negotiated agreement. A
rehired eligible employee may receive service credit for his or her previous
employment and is eligible to rejoin the Plan on the next enrollment date.
There were approximately 124 and 137 participating employees at December 31,
1999 and 1998, respectively.
6
<PAGE>
CSC OUTSOURCING INC. HOURLY SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
For the Two Years Ended December 31, 1999
Employee and Company Contributions
----------------------------------
A participant may authorize before-tax and after-tax contributions to the
Plan subject to a maximum level of contributions (a certain percentage of
base earnings), as specified by the bargaining agreement covering the
employee. Depending on the investment election option the participant
elects, the Company will contribute, and forward to the trust fund $0.50 for
each $1.00 of the employee matched contribution together with the
participant's before-tax and after-tax contribution.
Participants in certain bargaining units who direct 100 percent of their
contributions to the Plan's stock fund will receive a monthly matching
contribution of $1.00 for each $1.00 of employee matched contributions.
Participants under certain bargaining units may contribute additional
unmatched contributions at various percentages of base earnings to a maximum
specified by the union agreement covering the employee, but only if a
participant contributes the maximum matched percentage for which he or she is
eligible. The employee's base earnings deferred and contributed to the Trust
fund cannot exceed $10,000 for calendar year 1999, the maximum allowable
under the Code. Annual after-tax contributions to the Plan (including
employee and Company matching contributions) are limited to $30,000 for each
participant. Any compensation deferral in excess of $10,000 and any after-tax
contributions with matching Company contributions in excess of $30,000,
together with income allocable to those excess contributions will be returned
to a participant. Any matching Company contributions attributable to any
excess contribution, and income allocable thereto, will either be returned to
the Company or applied to reduce future matching Company contributions.
Participants may change their investment elections as of any enrollment date
if at least a 30 day prior notice is given. However, participants under
certain circumstances may be eligible to change their investment elections
within a 30 day window period. Participants may transfer their existing
account balances in 25 percent increments. Transfer elections are effective
on the first quarterly enrollment date following receipt of a 30 day prior
notice from the participant.
Company contributions - In accordance with the provisions of the Plan, the
Trustee must promptly invest matching Company contributions paid into the
trust fund in the same funds as the participant contributions.
The Plan does not permit employees to rollover a qualified distribution from
another plan.
7
<PAGE>
CSC OUTSOURCING INC. HOURLY SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
For the Two Years Ended December 31, 1999
Participant Accounts
--------------------
Each participant's account is credited with the participant's contribution
and the Company's matching contribution and allocations of Plan earnings, and
is charged with an allocation of investment management fees. Allocations are
based on participant earnings or account balances, as defined. The benefit
to which a participant is entitled is the benefit that can be provided from
the participant's vested account.
Vesting of Participants' Interests/Forfeitures
----------------------------------------------
Participants are 100 percent vested at all times in their before-tax and
after-tax contribution accounts. Each participant has a vested interest in
the value of his or her Company matching contributions account and investment
earnings thereon equal to 100 percent after completing five full years of
service.
The five-year cliff vesting schedule is overridden under extraordinary
circumstances as specified in the Plan document, in which the participant (or
beneficiary(ies)) immediately becomes fully vested in all employer
contributions and earnings, regardless of his or her number of years of
service.
Any nonvested balances will be immediately forfeited from the participant's
account at termination.
Distributable Amounts, Withdrawals and Refunds
----------------------------------------------
The entire balance in all accounts is distributed to participants who retire,
die, become disabled, are laid-off for four consecutive weeks, are discharged
without fault, or who involuntarily enter military service. Participants who
terminate for other reasons receive their vested balances. Nonvested
balances are forfeited immediately. The amounts distributed during 1999 and
1998 totaled $768,023 and $765,596, respectively.
While still an employee, a participant may make an in-service withdrawal of
all or a portion of his or her after-tax contributions, subject to frequency
of withdrawal penalties, as well as vested Company matching contributions,
plus the earnings on those amounts. Upon at least a 30 day written notice to
the Committee, a participant may make a hardship withdrawal of his or her
before-tax and after-tax contributions, as well as vested Company matching
contributions if the Committee finds, after considering the participant's
request, that an adequate financial hardship and resulting need for such
amount has been demonstrated by the participant. Both types of withdrawals
are subject to certain restrictions as described in the Plan document. No
hardship withdrawals were made in 1999 and 1998.
Note 2 Summary of Significant Accounting Policies
------------------------------------------
The accounting and reporting policies followed in preparation of the
financial statements of the Plan of the Company conform with accounting
principles generally accepted in the United States of America. The following
is a summary of the significant policies.
8
<PAGE>
CSC OUTSOURCING INC. HOURLY SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
For the Two Years Ended December 31, 1999
Use of Estimates
----------------
The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America 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 reported period. Actual results could differ from
those estimates.
Assets of the Plan
------------------
The assets of the Plan are held in a trust with four sub-accounts. The
investment income in the respective sub-accounts is allocated to the
participants. Contributions to, and payments from, the Plan are specifically
identified to the applicable sub-accounts within the trust.
Security Transactions
---------------------
Security transactions are accounted for on a trade date basis. Dividend
income is recorded on the ex-dividend date. Interest income is accounted for
on the accrual basis.
In general, participants in the Stock Fund receive distributions in
certificates for shares of the common stock of the Computer Sciences
Corporation.
Valuation of Investment Securities
----------------------------------
Investments in common stocks and institutional investment vehicles are stated
at fair value based upon closing sales prices reported on recognized
securities exchanges on the last business day of the plan year or, for the
listed securities having no sales reported and for unlisted securities, upon
last reported bid prices on that date. Investments in short-term securities
are stated at cost which approximates fair value.
Payment of Benefits
-------------------
Benefits are recorded when paid.
Reclassifications
-----------------
The Plan has adopted Statement of Position 99-3, "Accounting and Reporting of
Certain Defined Contribution Plan Investments and Other Disclosure Matters."
As a result, a reclassification of the prior year's financial statements has
been made to eliminate the by-fund disclosures.
Note 3 Income Tax Status
-----------------
The Internal Revenue Service has determined and informed the Company by a
letter dated June 1, 1995, that the Plan and related trust are designed in
accordance with applicable sections of the Internal Revenue Code (IRC).
9
<PAGE>
CSC OUTSOURCING INC. HOURLY SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
For the Two Years Ended December 31, 1999
The Committee believes that the Plan is designed and operated to qualify
under Section 401(a) of the Code and, with respect to its qualified cash or
deferred arrangement, under Section 401(k) of the Code. Since the
requirements of Section 401(k) of the Code are satisfied, the following tax
consequences result:
(i) A participant is not subject to federal income tax on Company
contributions to the Plan or on income or realized gains in Plan Accounts
attributable to the participant until a distribution from the Plan is made to
him or her.
(ii) The participant is able to exclude from his or her income for federal
income tax purposes, the amount of his or her compensation deferral
contributions, subject to a maximum exclusion of $10,000 for 1999 and 1998
taxable years of the participant, respectively.
(iii) On distribution of a participant's vested interest in the Plan, the
participant generally is subject to federal income taxation, except that: (1)
tax on "net unrealized appreciation" on any Computer Sciences Corporation
stock distributed as a part of a "lump sum distribution" generally would be
deferred until the participant disposes of such stock, and (2) tax may be
deferred to the extent the participant is eligible for and complies with
certain rules permitting the "rollover" of a qualifying distribution to
another retirement plan, or individual retirement account.
Note 4 Reconciliation of Financial Statements to Form 5500
---------------------------------------------------
<TABLE>
<CAPTION>
December 31,
---------------------------------
1999 1998
-------------- --------------
<S> <C> <C>
Net assets available for benefits per
the financial statements $4,877,477 $5,172,169
Amounts allocated to withdrawing
Participants (77,379) (167,744)
---------- ----------
Net assets available for benefits per
Form 5500 $4,800,098 $5,004,425
========== ==========
</TABLE>
10
<PAGE>
CSC OUTSOURCING INC. HOURLY SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
For the Two Years Ended December 31, 1999
The following is a reconciliation of benefits paid to participants per the
financial statements to the Form 5500:
<TABLE>
<CAPTION>
Year ended December 31,
-----------------------
1999 1998
---------- ----------
<S> <C> <C>
Benefits paid to participants per the
financial statements $ 768,023 $ 765,596
Add: Amounts allocated to withdrawing
participants at December 31, 1999 77,379 167,744
Less: Amounts allocated to withdrawing
participants at December 31, 1998 (167,744) (29,969)
---------- ----------
Benefits paid to participants per the Form 5500 $ 677,658 $ 903,371
========== ==========
</TABLE>
Amounts allocated to withdrawing participants are recorded on the Form 5500
for benefit claims that have been processed and approved for payment prior to
December 31, 1999 but not yet paid as of that date.
Note 5 Investment Funds
----------------
Participant contributions - Subject to rules the bargaining units have
adopted, each participant has the right to designate one or more of the
following investment funds established by the Committee for the investment of
his or her compensation deferral contributions and after-tax contributions in
percentages determined by the bargaining units.
The Fixed Income Fund
---------------------
The Fixed Income Fund represents holdings of units in a Master Trust
investment vehicle and is managed by BlackRock Financial Management. The
investment portfolio is actively managed and consists of short-term (1-3
year) fixed income instruments which include: U.S. Treasury and agency
securities, corporate bonds, mortgage-backed securities and asset-backed
fixed income securities. All of the Fund's assets are rated single-A or
better at the time of purchase and all securities must be U.S dollar
denominated. All new cash flows into the Fund are invested in this actively
managed bond fund. At December 31, 1999 and 1998, the Plan's interest in the
net assets of the Master Trust was approximately 8% and 0.97%, respectively.
Investment income and administrative expenses relating to the Master Trust
are allocated to individual plans based upon average monthly balances
invested by each plan.
11
<PAGE>
CSC OUTSOURCING INC. HOURLY SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
For the Two Years Ended December 31, 1999
The following table represents the fair value of investments for the Master
Trust.
<TABLE>
<CAPTION>
December 31,
---------------------------------
1999 1998
-------------- --------------
<S> <C> <C>
Investments at fair value:
Corporate bonds $10,683,212 $118,380,288
U.S. government securities 8,885,921 57,684,732
Other bonds 2,358,608 16,164,613
Short-term investments 233,323 3,777,721
Accrued income 160,208 966,721
----------- ------------
$22,321,272 $196,974,075
=========== ============
</TABLE>
Investment income for the Master Trust is as follows:
<TABLE>
<CAPTION>
December 31,
---------------------------------
1999 1998
-------------- --------------
<S> <C> <C>
Investment income:
Net (depreciation) appreciation in fair
value of investments $ (599,954) $ 1,731,522
Interest:
Corporate bonds 705,454 6,710,396
U.S. government securities 466,200 3,786,462
Other bonds 131,971 691,664
Short-term investments 73,592 365,214
----------- ------------
777,263 13,285,258
Less investment management fees (125,183) (227,349)
----------- ------------
$ 652,080 $ 13,057,909
=========== ============
</TABLE>
12
<PAGE>
CSC OUTSOURCING INC. HOURLY SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
For the Two Years Ended December 31, 1999
Mellon Capital Government Bond Fund
-----------------------------------
This fund is invested in bonds issued or guaranteed by the U.S. Government or
U.S. Government agencies. The Fund is managed by Mellon Capital with the
objective of tracking to the Intermediate Government Bond Index.
The Brinson U.S. Equity Fund
----------------------------
The Active Equity Fund is managed by Brinson Partners, Inc. The Fund is
broadly diversified by issue and industry relative to the Wilshire 5000
index. The Fund is typically invested in 70% large capitalization and 30%
intermediate and small capitalization stocks. The Fund may hold up to 50% in
cash equivalents for portfolio risk management purposes. The Fund's
objective is to maximize risk-adjusted total returns relative to the Wilshire
5000 index over a full economic cycle.
The CSC Stock Fund
------------------
Amounts allocated to this investment alternative will be used to purchase
shares of Computer Sciences Corporation common stock that are held for the
benefit of the participant. The performance of this investment depends upon
the performance of Computer Sciences Corporation's stock. The Trustee may
purchase Computer Sciences Corporation stock on national securities exchanges
or elsewhere.
Note 6 Participant Loans
-----------------
The Plan has a loan provision in place which is available to participants
covered by certain bargaining units. The Plan allows participants to borrow
from their vested account balances from a minimum of $500 up to a maximum of
$50,000 or 50% of their vested account, subject to certain limitations. The
loans bear interest at the prime rate quoted in the Wall Street Journal plus
1%, which is set on a quarterly basis.
Loan terms range from 1-5 years or up to 15 years for purchase of a primary
residence. Loans are recorded at cost, which approximate fair value, on the
Statement of Net Assets Available for Benefits.
The loans (which are accounted for in the Loan Fund) are deducted from the
participants' accounts according to a priority specified in the Plan's loan
rules and, within each account, pro rata from the funds based on their
balances at the time. Loan repayments are reinvested in the participants'
funds according to their current investment election. The repayments are
similarly allocated among participants' accounts according to the priority
specified in the Plan's rules.
Note 7 Benefits Payable
----------------
As of December 31, 1999 and 1998, net assets available for benefits included
benefits of $77,379 and $167,744, respectively, due to participants who have
withdrawn from participation in the Plan.
13
<PAGE>
CSC OUTSOURCING INC. HOURLY SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
For the Two Years Ended December 31, 1999
Note 8 Investments 1999
----------------
<TABLE>
<CAPTION>
Principal Fair Value
Amount or Contract
or Shares Cost Value
------------- ------------ ------------
<S> <C> <C> <C>
Fixed Income Fund
Interest in Master Trust* sh. 3,090,800 $1,849,074 $1,818,792
BNY Short-Term Money Market Fund 2,064 2,064 2,064
Mellon Capital Government Bond Fund
Mellon Capital:
Government Bond Fund* sh. 6,107 903,803 871,396
Temporary Investment Fund 122 122 122
BNY Short-Term Money Market Fund 3,198 3,198 3,198
Brinson U.S. Equity Fund
Brinson Partners Inc.:
U.S. Equity Portfolio* sh. 3,447 752,643 1,226,663
U.S. Cash Management Fund 2 2 2
BNY Short-Term Money Market Fund 3,646 3,646 3,646
CSC Stock Fund
Computer Sciences Common Stock* sh. 9,540 247,741 902,723
BNY Short-Term Money Market Fund 1,073 1,073 1,073
Employee Loan Fund
Participant Loan $ 11,670 11,670 11,670
---------- ----------
$3,775,036 $4,841,349
========== ==========
Total Long-Term Investments $3,764,931 $4,831,244
Total Short-Term Investments 10,105 10,105
---------- ----------
$3,775,036 $4,841,349
========== ==========
</TABLE>
*represents investments greater than 5% of net assets
14
<PAGE>
CSC OUTSOURCING INC. HOURLY SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
For the Two Years Ended December 31, 1999
Note 8 Investments 1998
----------------
<TABLE>
<CAPTION>
Principal Fair Value
Amount or Contract
or Shares Cost Value
------------- ---------- -----------
<S> <C> <C> <C>
Fixed Income Fund
Interest in Master Trust* sh. 3,080,507 $1,188,504 $1,906,881
BNY Short-Term Money Market Fund 1,610 1,610 1,610
Mellon Capital Government Bond Fund
Mellon Capital:
Government Bond Fund* sh. 6,921 964,200 981,182
Temporary Investment Fund 73 73 73
BNY Short-Term Money Market Fund 1,185 1,185 1,185
Brinson U.S. Equity Fund
Brinson Partners Inc.:
U.S. Equity Portfolio* sh. 4,155 830,813 1,591,617
U.S. Cash Management Fund 2 2 2
BNY Short-Term Money Market Fund 7,335 7,335 7,335
CSC Stock Fund
Computer Sciences Common Stock* Sh. 10,380 222,716 666,915
BNY Stort-Term Money Market Fund 4,382 4,382 4,382
Employee Loan Fund
Participant Loan $ 13,983 13,983 13,983
---------- ----------
$3,234,803 $5,175,165
========== ==========
Total Long-Term Investments $3,220,216 $5,160,578
Total Short-Term Investments 14,587 14,587
---------- ----------
$3,234,803 $5,175,165
========== ==========
</TABLE>
*represents investments greater than 5% of net assets
15
<PAGE>
CSC OUTSOURCING INC. HOURLY SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
For the Two Years Ended December 31, 1999
Note 9 Investments
-----------
The Plan's investments are held in a bank-administered trust-fund. The
following table presents investments.
<TABLE>
<CAPTION>
December 31,
-----------------------------
1999 1998
------------ ------------
<S> <C> <C>
Investments a Fair Value as Determined by
Quoted Market Price
CSC Company Stock $ 902,723 $ 666,915
Plan interest in Master Trust 1,818,79 1,906,881
Interest in registered investments companies:
Mellon Capital Government Fund 871,396 981,182
Brinson U.S. Equity Fund 1,226,663 1,591,617
Other short-term investments 10,105 14,587
---------- ----------
4,829,679 5,161,182
Investments at Estimated Fair Value
Employee loan fund 11,670 13,983
---------- ----------
11,670 13,983
---------- ----------
$4,841,349 $5,175,165
---------- ----------
</TABLE>
During 1999 and 1998 the Plan's investments (including bought, sold, and held
during the year) appreciated in value by $87,154 and $378,557, respectively,
as follows:
Net Change in Fair Value
<TABLE>
<CAPTION>
Year Ended December 31,
-----------------------------
1999 1998
------------ ------------
<S> <C> <C>
Investments a Fair Value as Determined by
Quoted Market Price
CSC Company Stock $ 296,281 $ 232,066
Plan interest in Master Trust (30,399) 3,497
Interest in registered investments companies:
Mellon Capital Government Fund (52,410) 15,495
Brinson U.S. Equity Fund (126,318) 127,499
---------- ----------
Net change in fair value $ 87,154 $ 378,557
========== ==========
</TABLE>
16
<PAGE>
SIGNATURES
The Plan. Pursuant to the requirements of the Securities Act of 1934, the
Computer Sciences Corporation Retirement Plans Committee has duly caused this
annual report to be signed on its behalf by the undersigned thereunto duly
authorized.
CSC OUTSOURCING INC. HOURLY SAVINGS PLAN
Date: June 28, 2000 By: /s/ LEON J. LEVEL
-----------------------------------
Leon J. Level
Chairman,
Computer Sciences Corporation
Retirement Plans Committee
17
<PAGE>
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in Computer Sciences Corporation
Registration Statement No. 333-00757 on Form S-8 of our report dated June 16,
2000, appearing in this Annual Report on Form 11-K of the CSC Outsourcing
Inc. Hourly Savings Plan for the year ended December 31, 1999.
/s/ DELOITTE & TOUCHE LLP
Los Angeles, California
June 28, 2000
E-1
<PAGE>
1999
Form 5500, Schedule H, Line 4i
CSC Outsourcing Inc. Hourly Savings Plan
EIN 88-0276684
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
-----------------------------------------------
<TABLE>
<CAPTION>
(a) (b)Identity of issue, (c)Description of investment including (d)Cost (e)Current
borrower, lessor or maturity date, rate of interest, Value
similar party collateral, par or maturity value
--- ---------------------- ------------------------------------------- ---------- -----------
<S> <C> <C> <C> <C>
Mellon Capital Mutual Fund - Government Bond Fund $ 903,803 $ 871,396
Management Corp.
Brinson Trust Mutual Fund - U.S. Equity Portfolio 752,643 1,226,663
Company, Inc.
* Computer Sciences Common Stock 247,741 902,723
Corporation
* Computer Sciences Employee Loan Fund (9.25%, 3/29/02) 11,670 11,670
Corporation
Brinson Trust U.S. Cash Management Fund 2 2
Company, Inc.
Mellon Capital Mellon Bank Temporary Investment Fund 122 122
Management Corp.
* Bank of New York BNY Short-Term Money Market Fund 9,981 9,981
---------- ----------
Total Assets Held for Investment Purposes $1,925,962 $3,022,557
========== ==========
</TABLE>
* represents party in interest
S-1
<PAGE>
1999
Form 5500, Schedule H, Line 4j
CSC Outsourcing Inc. Hourly Savings Plan
EIN 88-0276684
SCHEDULE OF REPORTABLE TRANSACTIONS
-----------------------------------
Single Transactions in Excess of 5%
<TABLE>
<CAPTION>
(a)Identity (b)Description (c)Purchase (d)Selling (g)Cost of (h)Current Value (i)Net Gain
of Party of Asset Price Price Asset of Asset on or (Loss)
Involved Transaction
Date
----------- -------------- ----------- ---------- ---------- ---------------- ------------
<S> <C> <C> <C> <C> <C> <C>
None to report
</TABLE>
S-2
<PAGE>
1999
Form 5500, Schedule H, Line 4j
CSC Outsourcing Inc. Hourly Savings Plan
EIN 88-0276684
SCHEDULE OF REPORTABLE TRANSACTIONS
-----------------------------------
Series Transactions in the Aggregate in Excess of 5%
<TABLE>
<CAPTION>
(a)Identity (b)Description (c)Purchase (d)Selling (g)Cost of (h)Current (i)Net Gain
of Party of Asset Price Price Asset Value or (Loss)
Involved of Asset on
Transaction
Date
------------- -------------- ----------- ---------- ---------- -------------- ------------
<S> <C> <C> <C> <C> <C> <C>
Bank of New BNY Short-Term
York Money Market
Fund
- Purchases $812,978 $812,978 $812,978
- Sales $817,507 817,507 817,507
Mellon Guaranteed
Intermediate Investment
Gov't Bond Contract
- Purchases 71,148 71,148 71,148
- Sales 128,524 128,524 128,524 $ (3,021)
Brinson U.S.
Equity with
Cash Fd
- Purchases 128,277 128,277 128,277
- Sales 366,914 366,914 366,914 160,466
</TABLE>
S-3
