<PAGE>
SECURITY AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
[x] Annual Report Pursuant To Section 15(D) of The Securities Exchange Act of
1934 (Fee Required)
For the fiscal year ended December 31, 1998
-------------------------------------------------
OR
[ ] Transition Report Pursuant To Section 15(D) of The Securities Exchange Act
of 1934 (No Fee Required)
For the transition period from __________________ to ______________________
COMMISSION FILE NUMBER ______________
A. Full title of the plan and address of the plan, if different from that
of the issuer named below:
INTERNATIONAL RECTIFIER CORPORATION RETIREMENT SAVINGS PLAN
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
INTERNATIONAL RECTIFIER CORPORATION
233 KANSAS STREET
EL SEGUNDO, CALIFORNIA 90245
<PAGE>
SIGNATURES
The Plan. Pursuant to the requirements of the Securities Exchange Act of 1934,
the trustees (or other persons who administer the employee benefit plan) have
duly caused this annual report to be signed on its behalf by the undersigned
hereunto duly authorized.
INTERNATIONAL RECTIFIER CORPORATION RETIREMENT SAVINGS PLAN
/s/ Michael P. McGee
--------------------
Michael P. McGee
Member of Administrative Committee
<PAGE>
INTERNATIONAL RECTIFIER CORPORATION
RETIREMENT SAVINGS PLAN
INDEX TO FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES
<TABLE>
<CAPTION>
Page
------
<S> <C>
Report Of Independent Public Accountants 1
Statement Of Net Assets Available For Benefits With Fund Information
As Of December 31, 1998 2
Statement Of Net Assets Available For Benefits With Fund Information
As Of December 31, 1997 3
Statement Of Changes In Net Assets Available For Benefits With Fund Information
For The Year Ended December 31, 1998 4
Statement Of Changes In Net Assets Available For Benefits With Fund Information
For The Year Ended December 31, 1997 5
Notes To Financial Statements 6-11
Supplemental Schedules:
Line 27a - Schedule Of Assets Held For Investment Purposes
As Of December 31, 1998 12
Line 27d - Schedule Of Reportable Transactions
For The Year Ended December 31, 1998 13
Exhibit
23.1 Consent of Independent Accountants
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To The Plan Administrator
International Rectifier Corporation
In our opinion, the accompanying statements of net assets available for benefits
and the related statements of changes in net assets available for benefits
present fairly, in all material respects, the net assets available for benefits
of International Rectifier Corporation Retirement Savings Plan (the "Plan") at
December 31, 1998 and 1997, and the changes in net assets available for benefits
for the years ended December 31, 1998 and 1997 in conformity with generally
accepted accounting principles. 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 of these statements in accordance with generally accepted auditing
standards which 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, 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 the opinion expressed above.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules of Line 27a --
Schedule of Assets Held for Investment Purposes and Line 27d -- Schedule of
Reportable Transactions, 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 fund information in the statements of net assets
available for benefits and the statement of changes in net assets available for
benefits is presented for purposes of additional analysis rather than to present
the net assets available for plan benefits and changes in net assets available
for benefits of each fund. These supplemental schedules and fund information are
the responsibility of the Plan's management. The supplemental schedules and fund
information 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.
PricewaterhouseCoopers L.L.P.
Newport Beach, California
June 28 1999
1
<PAGE>
INTERNATIONAL RECTIFIER CORPORATION
RETIREMENT SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR
BENEFITS WITH FUND INFORMATION
AS OF DECEMBER 31, 1998
- --------------------------------------------
Fund Information
- ---------------------------------------------------------------------------------------------------------------------------
Fidelity
Growth Fidelity Fidelity Fidelity
Interest-Bearing IR Stock Company Intermediate Value Low-Priced
Cash Fund Unit Fund Fund Bond Fund Fund Stock Fund
---------------- ----------- ------------ -------------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Investments at fair value - $5,031,146 $10,495,138 $3,714,732 $8,795,239 $842,790
-------- ---------- ----------- ---------- ---------- --------
Total investments - 5,031,146 10,495,138 3,714,732 8,795,239 842,790
-------- ---------- ----------- ---------- ---------- --------
Receivables:
Employee contributions $ 92,665 - - - - -
Employer contributions 88,335 - - - - -
-------- ---------- ----------- ---------- ---------- --------
Total receivables 181,000 - - - - -
-------- ---------- ----------- ---------- ---------- ---------
Net assets available
for benefits $181,000 $5,031,146 $10,495,138 $3,714,732 $8,795,239 $842,790
-------- ---------- ----------- ---------- ---------- ---------
-------- ---------- ----------- ---------- ---------- ---------
<CAPTION>
Fund Information
- -----------------------------------------------------------------------------------------------------------------------------
Fidelity
Fidelity Retirement Fidelity
Diversified Government Managed U.S.
International Money Market Income Equity Participant
Fund Portfolio Portfolio Index Fund Loan Fund Total
------------- ------------- ---------- ----------- ------------ -----------
<S> <C> <C> <C> <C> <C> <C>
Investments at fair value $567,758 $5,011,944 $4,566,597 $2,788,369 $2,600,858 $44,414,571
-------- ---------- ---------- ---------- ---------- -----------
Total investments 567,758 5,011,944 4,566,597 2,788,369 2,600,858 44,414,571
-------- ---------- ---------- ---------- ---------- -----------
Receivables:
Employee contributions - - - - - 92,665
Employer contributions - - - - - 88,335
-------- ---------- ---------- ---------- ---------- -----------
Total receivables - - - - - 181,000
-------- ---------- ---------- ---------- ---------- -----------
Net assets available
for benefits $567,758 $5,011,944 $4,566,597 $2,788,369 $2,600,858 $44,595,571
-------- ---------- ---------- ---------- ---------- -----------
-------- ---------- ---------- ---------- ---------- -----------
</TABLE>
The accompanying notes are an integral part of these financial statements.
2
<PAGE>
INTERNATIONAL RECTIFIER CORPORATION
RETIREMENT SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR
BENEFITS WITH FUND INFORMATION
AS OF DECEMBER 31, 1997
- --------------------------------------------
<TABLE>
<CAPTION>
Fund Information
- ---------------------------------------------------------------------------------------------------------------------------
Fidelity
Growth Fidelity Fidelity Fidelity
Interest-Bearing IR Stock Company Intermediate Value Low-Priced
Cash Fund Unit Fund Fund Bond Fund Fund Stock Fund
---------------- ----------- ------------ -------------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Investments at fair value - $3,881,680 $7,723,237 $3,211,509 $9,746,500 $513,457
------------- ---------- ---------- ---------- ---------- --------
Total investments - 3,881,680 7,723,237 3,211,509 9,746,500 513,457
---------------- ---------- ---------- ---------- ---------- --------
Receivables:
Employer contributions $210,969 - - - - -
Employee contributions 209,816 - - - - -
---------------- ---------- ---------- ---------- ---------- --------
Total receivables 420,785 - - - - -
---------------- ---------- ---------- ---------- ---------- ---------
Net assets available
for benefits $420,785 $3,881,680 $7,723,237 $3,211,509 $9,746,500 $513,457
<CAPTION>
Fund Information
- -----------------------------------------------------------------------------------------------------------------------------
Fidelity
Fidelity Retirement Fidelity
Diversified Government Managed U.S.
International Money Market Income Equity Participant
Fund Portfolio Portfolio Index Fund Loan Fund Total
------------- ------------- ---------- ----------- ------------ -----------
<S> <C> <C> <C> <C> <C> <C>
Investments at fair value $325,010 $4,009,676 $4,386,183 $996,401 $2,219,460 $37,013,113
-------- ---------- ---------- ---------- ---------- -----------
Total investments 325,010 4,009,676 $4,386,183 $996,401 $2,219,460 37,013,113
-------- ---------- ---------- ---------- ---------- -----------
Receivables:
Employer contributions - - - - - 210,969
Employee contributions - - - - - 209,816
-------- ---------- ---------- ---------- ---------- -----------
Total receivables 420,785
-------- ---------- ---------- ---------- ---------- -----------
Net assets available
for benefits $325,010 $4,009,676 $4,386,183 $996,401 $2,219,460 $37,433,898
-------- ---------- ---------- ---------- ---------- -----------
-------- ---------- ---------- ---------- ---------- -----------
</TABLE>
The accompanying notes are an integral part of these financial statements.
3
<PAGE>
INTERNATIONAL RECTIFIER CORPORATION
RETIREMENT SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS
AVAILABLE FOR BENEFITS WITH FUND
INFORMATION
AS OF DECEMBER 31, 1998
- --------------------------------------------
<TABLE>
<CAPTION>
Fund Information
- ---------------------------------------------------------------------------------------------------------------------------
Fidelity
Growth Fidelity Fidelity Fidelity
Interest-Bearing IR Stock Company Intermediate Value Low-Priced
Cash Fund Unit Fund Fund Bond Fund Fund Stock Fund
---------------- ----------- ------------ -------------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Additions:
Contributions:
Employee ($117,151) $630,106 $1,398,916 $396,364 $1,016,945 $206,094
Employer (122,634) 170,909 257,821 108,257 238,609 37,290
--------- -------- ---------- -------- ----------- --------
Total contributions (239,785) 801,015 1,656,737 504,621 1,255,554 243,384
--------- -------- ---------- -------- ----------- --------
Dividend income - - 724,205 212,429 1,262,138 62,981
Interest income - - - - - -
Net appreciation
(depreciation) in investments - (318,530) 1,448,889 32,343 (1,289,295) (59,706)
Loan Repayment - 148,893 228,135 102,904 274,183 39,920
--------- -------- ---------- -------- ----------- --------
Total additions (239,785) 631,378 4,057,966 852,297 1,502,580 286,579
--------- -------- ---------- -------- ----------- --------
Deductions:
Benefits paid to participants - (92,542) (359,407) (115,878) (451,313) (721)
Administrative fees - (3,470) (2,319) (650) (420) (315)
Loan advances - (69,093) (245,913) (177,771) (391,673) (27,852)
--------- -------- ---------- -------- ----------- --------
Total deductions - (165,105) (607,639) (294,299) (843,406) (28,888)
--------- -------- ---------- -------- ----------- --------
Net increase (decrease)
prior to interfund
transfers (239,785) 466,273 3,450,327 557,998 659,174 257,691
Transfers 0 683,193 (678,426) (54,775) (1,610,435) 71,642
Balances at December 31, 1997 420,785 3,881,680 7,723,237 3,211,509 9,746,500 513,457
Balances at December 31, 1998 $181,000 $5,031,146 $10,495,138 $3,714,732 $8,795,239 $842,790
-------- ---------- ----------- ---------- ----------- --------
-------- ---------- ----------- ---------- ----------- --------
<CAPTION>
Fund Information
- -----------------------------------------------------------------------------------------------------------------------------
Fidelity
Fidelity Retirement Fidelity
Diversified Government Managed U.S.
International Money Market Income Equity Participant
Fund Portfolio Portfolio Index Fund Loan Fund Total
------------- ------------- ---------- ----------- ------------ -----------
<S> <C> <C> <C> <C> <C> <C>
Additions:
Contributions:
Employee $100,867 $583,965 $433,811 $518,344 - $5,168,261
Employer 22,074 187,628 117,868 60,805 - 1,078,627
-------- -------- -------- -------- ------------- ----------
Total contributions 122,941 771,593 551,679 579,149 - 6,246,888
-------- --------- -------- --------- ------------- ----------
Dividend income 21,138 240,168 252,124 46,938 - 2,822,121
Interest income - - - - $ 177,344 177,344
Net appreciation
(depreciation) in investments 38,020 - - 498,848 - 350,569
Loan repayments 36,475 167,903 134,105 28,625 (1,161,143) -
-------- --------- -------- --------- ------------- ----------
Total additions 218,574 1,179,664 937,908 1,153,560 (983,799) 9,596,922
-------- --------- -------- --------- ------------- ----------
Deductions:
Benefits paid to participants (3,025) (366,807) (449,264) (501,017) (87,296) (2,427,270)
Administrative fees (50) (345) (360) (50) - (7,979)
Loan advances (4,691) (275,370) (205,297) (54,833) 1,452,493 -
-------- -------- -------- -------- ------------- ----------
Total deductions (7,766) (642,522) (654,921) (555,900) 1,365,197 (2,435,249)
-------- --------- -------- --------- ------------- ----------
Net increase (decrease)
prior to interfund
transfers 210,808 537,142 282,987 597,660 381,398 7,161,673
Transfers 31,940 465,126 (102,573) 1,194,308 - -
Balances at December 31, 1997 325,010 4,009,676 4,386,183 996,401 2,219,460 37,433,898
-------- ---------- ---------- ---------- ------------- -----------
Balances at December 31, 1998 $567,758 $5,011,944 $4,566,597 $2,788,369 $2,600,858 $44,595,571
-------- ---------- ---------- ---------- ------------- -----------
-------- ---------- ---------- ---------- ------------- -----------
</TABLE>
The accompanying notes are an integral part of these financial statements.
4
<PAGE>
INTERNATIONAL RECTIFIER CORPORATION
RETIREMENT SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS
AVAILABLE FOR BENEFITS WITH FUND
INFORMATION
AS OF DECEMBER 31, 1997
- --------------------------------------------
<TABLE>
<CAPTION>
FDIC Stable
Cash Pooled Value Intermediate Value
Clearing Savings Income Term Momentum Growth Company
Fund Fund Fund Bond Fund Equity Fund Equity Fund Stock Fund
---- ---- ---- --------- ----------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Additions:
Contributions: - - - - - - -
Employer - - - - - - -
Employee - - - - - - -
-------- -------- -------- -------- -------- -------- --------
Total contributions - - - - - - -
-------- -------- -------- -------- -------- -------- --------
Dividend income - - - - - - -
Interest income - $10 $40 $69 $9 $43 $4
Net appreciation (depreciation) in
investments - - - - - - -
Loan repayments - - - - - - -
-------- -------- -------- -------- -------- -------- --------
Total additions - $10 $40 $69 $9 $43 $4
-------- -------- -------- -------- -------- -------- --------
Deductions:
Benefits paid to participants - - - - - - -
Administrative fee - - - - - - -
Loan advances - - - - - - -
-------- -------- -------- -------- -------- -------- --------
Total deductions - - - - - - -
-------- -------- -------- -------- -------- -------- --------
Net increase
(decrease) prior
to interfund
transfers - 10 40 69 9 43 4
Transfers ($421,676) (3,904,480) (3,900,676) (2,827,354) (7,404,436) (5,622,606) (3,697,420)
Balances at December 31, 1996 421,676 3,904,470 3,900,636 2,827,285 7,404,427 5,622,563 3,697,416
Balances at December 31, 1997 $- $- $- $- $- $- $-
-------- -------- -------- -------- -------- -------- --------
-------- -------- -------- -------- -------- -------- --------
</TABLE>
<TABLE>
<CAPTION>
Interest- Fidelity Fidelity Fidelity
Bearing Growth Intermediate Fidelity Low-Priced
Cash IR Stock Company Bond Value Stock
Fund Unit Fund Fund Fund Fund Fund
---- --------- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Additions:
Contributions:
Employer ($18,092) $189,587 $278,692 $124,506 $271,617 $8,107
Employee 17,201 660,963 1,268,292 450,769 1,138,903 86,929
--------- --------- --------- --------- --------- ---------
Total contributions (891) 850,550 1,546,984 575,275 1,410,520 95,036
--------- --------- --------- --------- --------- ---------
Dividend income - - 733,904 194,677 1,334,693 30,925
Interest income - 199 10 7 12 -
Net appreciation
(depreciation) in
investments - (795,198) 490,145 40,126 389,287 30,085
Loan repayments - 114,269 151,776 83,963 183,318 10,233
--------- --------- --------- --------- --------- ---------
Total additions (891) 169,820 2,922,819 894,048 3,317,830 166,279
--------- --------- --------- --------- --------- ---------
Deductions:
Benefits paid to
participants - (175,034) (285,998) (134,058) (300,507) (8,089)
Administrative fee - (3,815) (1,968) (563) (473) (610)
Loan advances - (118,819) (207,438) (131,748) (330,456) (7,027)
--------- --------- --------- --------- --------- ---------
Total deductions - (297,668) (495,404) (266,369) (631,436) (15,726)
--------- --------- --------- --------- --------- ---------
Net increase
(decrease) prior
to interfund
transfers (891) (127,848) 2,427,415 627,679 2,686,394 150,553
Transfers 421,676 4,009,528 5,295,822 2,583,830 7,060,106 362,904
Balances at December 31, 1996 - - - - - -
Balances at December 31, 1997 $420,785 $3,881,680 $7,723,237 $3,211,509 $9,746,500 $513,457
</TABLE>
<TABLE>
<CAPTION> Fidelity
Retirement Fidelity
Fidelity Government U.S.
Diversified Money Managed Equity
International Market Income Index Participant
Fund Portfolio Portfolio Fund Loan Fund Total
---- --------- --------- ---- --------- -----
<S> <C> <C> <C> <C> <C> <C>
Additions:
Contributions:
Employer $5,008 $219,547 $144,948 $11,137 - $1,235,057
Employee 74,541 657,343 514,135 121,254 - 4,990,330
---------- ---------- ---------- ---------- ---------- ----------
Total contributions 79,549 876,890 659,083 132,391 - 6,225,387
---------- ---------- ---------- ---------- ---------- ----------
Dividend income 11,402 210,449 246,907 15,541 - 2,778,498
Interest income - 9,188 15,848 - $149,665 175,104
Net appreciation (depreciation) in
investments 2,604 101 (24) 114,485 - 271,611
Loan repayments 11,166 123,758 133,935 10,791 (823,209) -
---------- ---------- ---------- ---------- ---------- ----------
Total additions 104,721 1,220,386 1,055,749 273,208 (673,544) 9,450,600
---------- ---------- ---------- ---------- ---------- ----------
Deductions:
Benefits paid to participants (3,118) (330,359) (167,895) (8,709) (61,935) (1,475,702)
Administrative fee (50) (1,113) (155) - - (8,747)
Loan advances (14,485) (311,786) (137,741) (6,165) 1,265,665 -
---------- ---------- ---------- ---------- ---------- ----------
Total deductions (17,653) (643,258) (305,791) (14,874) 1,203,730 (1,484,449)
Net increase
(decrease) prior
to interfund
transfers 87,068 577,128 749,958 258,334 530,186 7,966,151
Transfers 237,942 3,432,548 3,636,225 738,067 - -
Balances at December 31, 1996 - - - - 1,689,274 29,467,747
Balances at December 31, 1997 $325,010 $4,009,676 $4,386,183 $996,401 $2,219,460 $37,433,898
</TABLE>
5
<PAGE>
INTERNATIONAL RECTIFIER CORPORATION
RETIREMENT SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------
1. DESCRIPTION OF THE PLAN
The following description of the International Rectifier Corporation
Retirement Savings Plan (the "Plan") provides only general information.
Participants should refer to the Plan agreement for a more complete
description of the Plan's provisions.
GENERAL
International Rectifier Corporation (the "Company") established the
Plan on April 1, 1988. The Plan is a defined contribution plan subject
to the provisions of the Employee Retirement Income Security Act of
1974 ("ERISA"), as amended.
ELIGIBILITY
Employee is eligible to participate in the Plan in the first day of the
payroll period which falls immediately after the later of (i) the date
which is 90 days after his or her date of hire, or (ii) the date on
which he or she attains age 18.
CONTRIBUTIONS
Effective January 1, 1998, participants may elect to make
contributions up to 15% of their pretax annual compensation, as
defined in the Plan. For the Plan year ended December 31, 1997,
Participants were permitted to make contributions up to 20% of their
pretax annual compensation. Participants may also contribute amounts
representing distributions from other qualified defined benefit or
contribution plans. The Company contributes an amount equal to 150%
of the first $200 of the participant's contribution, 50% of the next
$1,400, and 25% of the next $800 in a Plan year. The aggregate
matching contribution made by the Company shall not exceed $1,200
per participant in a Plan year. In addition to the Company's
matching contribution, the Board of Directors may make annual
discretionary contributions in the form of cash or Company stock.
For the years ended December 31, 1998 and 1997, no discretionary
matching contributions were authorized by the Board.
VESTING
Participants are immediately vested in their contributions and the
Company's matching and discretionary contributions plus actual earnings
thereon.
6
<PAGE>
1. DESCRIPTION OF THE PLAN (CONTINUED)
PARTICIPANT ACCOUNTS
Each participant's account is credited with (a) the participant's
contribution and allocations of (b) the Company's contribution and (c)
Plan earnings. Allocations are based on participant contributions 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.
INVESTMENT PROGRAMS
The trustee for the Plan is Fidelity Management Trust Company. All
accounts are held in trust funds and invested in accordance with the
terms of the Plan and investment options elected by Plan participants.
A brief description of these funds is as follows:
FIDELITY RETIREMENT GOVERNMENT MONEY MARKET PORTFOLIO - An income
fund with investments in high quality short-term money market
securities for which the U.S. government or its agencies or
instrumentalities guarantees timely payment of principal and
interest.
MANAGED INCOME PORTFOLIO - A stable value fund with investments in
contracts offered by major insurance companies and other approved
financial institutions and short-term instruments.
FIDELITY INTERMEDIATE BOND FUND - An income fund with investments in
all types of U.S. and foreign bonds, including corporate or U.S.
government issues.
FIDELITY VALUE FUND - A growth fund with investments primarily in
stocks of companies that possess valuable assets or that the manager
feels are undervalued.
FIDELITY GROWTH COMPANY FUND - A growth fund with investments
primarily in stocks of companies with earnings or gross sales that
indicate the potential for above average growth.
FIDELITY U.S. EQUITY INDEX FUND - A growth and income fund
with investments primarily in the 500 companies that make up the
S&P 500.
FIDELITY LOW-PRICED STOCK FUND - A growth fund with investments
primarily in stocks of companies the fund manager considers
undervalued or out of favor with other investors and that could
offer the possibility for significant growth.
FIDELITY DIVERSIFIED INTERNATIONAL FUND - A growth fund that invests
primarily in stocks of companies located outside the U.S. that are
included in the Morgan Stanley Europe, Australia, Far East Index.
7
<PAGE>
1. DESCRIPTION OF THE PLAN (CONTINUED)
INVESTMENT PROGRAMS (CONTINUED)
IR STOCK UNIT FUND - A fund that pools the money of Plan participants
to buy stock in the Company as well as a small amount of money market
instruments that allow the fund to handle exchanges, withdrawals and
distributions.
INTEREST-BEARING CASH FUND - A fund that temporarily holds cash from
the time an investment in one fund is liquidated and a purchase in
another is settled.
Participants can allocate their contributions and account balances to
any or all of the funds (contributions must be allocated in 20%
blocks). Participants may transfer their balances, or a portion
thereof, from one fund to another.
PARTICIPANT LOANS
The Plan allows participants to borrow from their accounts a minimum of
$1,000 up to a maximum equal to the lesser of $50,000 or 50% of their
account balance. Loan transactions are treated as a transfer to (from)
the investment fund from (to) the Participant Loan Fund. Loan terms
range from 1-5 years or up to 10 years for the purchase of a primary
residence. The loans are collateralized by the balance in the
participant's account and bear interest at a rate commensurate with
local prevailing rates as determined quarterly by the Plan
administrator. Principal and interest is paid ratably through monthly
payroll deductions.
BENEFIT PAYMENTS
On termination of service, a participant with an account balance
greater than $5,000 may elect to receive either a lump-sum amount
equal to the value of the participant's account or installments in
the form of various types of annuities, as defined by the Plan. A
participant with an account balance less than or equal to $5,000
must receive the value of his or her account as a lump-sum
distribution. For the Plan year ended December 31, 1997, this minimum
amount was $3,500. Benefits are recorded when paid.
2. SUMMARY OF ACCOUNTING POLICIES.
BASIS OF ACCOUNTING
The accompanying financial statements of the Plan are prepared using
the accrual method of accounting.
9
<PAGE>
2. SUMMARY OF ACCOUNTING POLICIES (CONTINUED)
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 in the
statement of changes in net assets available for benefits during the
reporting period. Actual results could differ from those estimates.
RISKS AND UNCERTAINTIES
The Plan provides for various investment options in mutual funds and
other securities. Investment securities are exposed to various risks,
such as interest rate, market and credit. Due to the level of risk
associated with certain investment securities, it is at least
reasonably possible that changes in risks in the near term would
materially affect participants' account balances and the amounts
reported in the statement of net assets available for benefits and the
statement of changes in net assets available for benefits.
INVESTMENTS
The Plan's investments in shares of registered investment company
mutual funds and the Company stock are valued at the last quoted sales
price on the last business day of the year. Investments in commingled
trust funds are valued at estimated fair values according to methods
selected in good faith by the trustee. Participant loans are valued at
the unpaid amount of the loan which is estimated to approximate fair
value.
Purchases and sales of securities are reflected on a trade date basis.
The basis for all securities sold is determined by average cost.
Dividend income is recorded on the ex-dividend date and interest income
is recorded on the accrual basis. The Plan presents in the statement of
changes in net assets available for benefits the net appreciation
(depreciation) in fair value of its investments, which consists of the
realized gains or losses and unrealized appreciation or depreciation on
those investments.
ADMINISTRATIVE EXPENSES
The Company and the Plan pay for all administrative expenses of the
Plan. The Company paid approximately $25,000 and $18,000 of
administrative expenses on behalf of the Plan for the years ended
December 31, 1998 and 1997.
10
<PAGE>
3. INVESTMENTS
Investments at December 31 are as
follows:
<TABLE>
<CAPTION>
1998 1997
-------------------------------- -------------------------------
Fair Value Units Fair Value Units
---------- ----- ---------- -----
<S> <C> <C> <C> <C>
Investments, at fair value, as determined by
quoted market price:
IR Stock Unit Fund $ 4,959,051 508,505 $3,766,342 318,689
Fidelity Growth Company Fund 10,495,138 205,706 7,723,237 178,283
Fidelity Intermediate Bond Fund 3,714,732 361,707 3,211,509 315,783
Fidelity Value Fund 8,795,239 189,757 9,746,500 180,357
Fidelity Low-Priced Stock Fund 842,790 36,883 513,457 20,432
Fidelity Diversified International Fund 567,758 32,041 325,010 20,149
Fidelity U.S. Equity Index Fund 2,788,369 63,430 996,401 28,485
Investments, at estimated fair value:
Interest-Bearing Cash Fund 72,095 115,338
Managed Income Portfolio 4,566,597 4,566,597 4,386,183 4,386,183
Fidelity Retirement Government Money Market Portfolio 5,011,944 5,011,944 4,009,676 4,009,676
Participant Loans 2,600,858 2,219,460
----------- -----------
$44,414,571 $37,013,113
----------- -----------
----------- -----------
</TABLE>
Net appreciation (depreciation) in the value of investments for the
years ended December 31, are summarized as follows:
<TABLE>
<CAPTION>
1998 1997
---- ----
<S> <C> <C>
Common stock ($318,530) ($795,198)
Mutual funds 669,099 1,066,833
Commingled trust fund - (24)
-------------- --------------
Net appreciation $350,569 $271,611
-------------- --------------
-------------- --------------
</TABLE>
11
<PAGE>
4. PLAN TERMINATION
Although it has not expressed any intent to do so, the Company has the
right under the Plan to discontinue its contributions at any time and
to terminate the Plan subject to the provisions of ERISA. The accounts
of the participants affected by a partial or complete termination of
the Plan are nonforfeitable and will be determined as of the
termination date.
5. TAX STATUS OF THE PLAN
The Plan has obtained a favorable tax determination letter from the
Internal Revenue Service dated February 26, 1998. The Plan
administrator and the Plan's tax counsel believe that the Plan is
designed and is currently being operated in compliance with the
applicable requirements of the IRC.
Under the provisions of Section 401(k) of the Internal Revenue Code,
contributions to the Plan are not taxable until distributed to the
participants.
12
<PAGE>
SUPPLEMENTAL SCHEDULES
<PAGE>
INTERNATIONAL RECTIFIER CORPORATION
RETIREMENT SAVINGS PLAN
LINE 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
AS OF DECEMBER 31, 1998
----------
<TABLE>
<CAPTION>
Identity Of Issue Cost Current Value
- ----------------- ---- -------------
<S> <C> <C>
Interest-Bearing Cash $72,095 $72,095
International Rectifier Stock Unit Fund 2,805,853 4,959,051
Fidelity Growth Company Fund 9,732,162 10,495,138
Fidelity Intermediate Bond Fund 3,652,020 3,714,732
Fidelity Value Fund 9,661,242 8,795,239
Fidelity Low-Priced Stock Fund 883,692 842,790
Fidelity Diversified International Fund 557,459 567,758
Fidelity Retirement Government Money Market Portfolio 5,011,944 5,011,944
Managed Income Portfolio 4,566,597 4,566,597
Fidelity U.S. Equity Index Fund 2,411,759 2,788,369
Participant loans with interest rates ranging
from 8.30% to 8.50% -0- 2,600,858
-----------
$44,414,571
-----------
-----------
</TABLE>
12
<PAGE>
INTERNATIONAL RECTIFIER CORPORATION
RETIREMENT SAVINGS PLAN
LINE 27d - SCHEDULE OF REPORTABLE TRANSACTIONS
AS OF DECEMBER 31, 1998
----------
Transactions in excess of 5% of current value of Plan assets at the beginning of
the year are as follows:
SERIES OF TRANSACTIONS
<TABLE>
<CAPTION>
Total Total Total Total
Number Of Number Of Dollar Value Dollar Value Net Gain
Descriptions Purchases Sales Of Purchases Of Sales (Loss)
- ------------ --------- ----- ------------ -------- ------
<S> <C> <C> <C> <C> <C>
International Rectifier Stock Unit
Fund 224 170 $3,680,106 $2,212,110 ($127,661)
Fidelity Growth Equity Fund 208 173 3,176,888 1,853,875 160,138
Fidelity Intermediate Bond Fund 191 142 1,402,189 931,309 9,645
Fidelity Value Fund 212 183 3,536,775 3,198,741 (3,211)
Fidelity Retirement Government Money
Market Portfolio 196 186 3,118,664 2,116,396 -
Managed Income Portfolio 169 153 1,828,960 1,648,546 -
Fidelity U.S. Equity Index Fund 173 79 2,660,083 1,366,961 123,820
</TABLE>
13
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the registration statements
of International Rectifier Corporation on Forms S-8 (File No. 33-44332 and
333-57575) of our report dated June 28, 1999 of our audits of the financial
statements of International Rectifier Corporation Retirement Savings Plan as
of December 31, 1998 and 1997 and for the years ended December 31, 1998 and
1997, which report is included in this Form 11-K.
Newport Beach, California
June 28, 1999
