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 [FEE REQUIRED]
For The Fiscal Year Ended December 31, 1994
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 0-6547
A. Full title of the plan and the address of the plan, if different from
that of the issuer named below: MCI Consumer Markets 401(k) Plan - Part
I of the MCI Consumer Markets 401(k) and ESOP
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office: MCI Communications
Corporation, 1801 Pennsylvania Avenue, NW, Washington, DC 20006
Page 1
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MCI CONSUMER MARKETS 401(K) PLAN
EIN: 13-2745892
INDEX TO FINANCIAL STATEMENTS AND SCHEDULES
Page(s)
-------
Report of Independent Accountants 3
Statements of Net Assets Available for Benefits
at December 31, 1994 and 1993 4,5
Statements of Changes in Net Assets Available for
Benefits for the years ended December 31, 1994 and 1993 6,7
Notes to Financial Statements 8-32
Additional Information:
Schedule I.
Schedule of Assets Held for
Investment Purposes at
December 31, 1994 33
Schedule II.
Schedule of Reportable
Transactions for the year
ended December 31, 1994 34
Signature 35
Exhibits:
23. Consent of Independent Accountants 36
99. Certification Regarding Certain
Investment Arrangements 37
Page 2
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Participants and Administrative
Committee of the MCI Consumer Markets 401(k) Plan
In our opinion, the accompanying statements of net assets available for benefits
and related statements of changes in net assets available for benefits present
fairly, in all material respects, the net assets available for benefits of the
MCI Consumer Markets 401(k) Plan - Part I of the MCI Consumer Markets 401(k) and
ESOP at December 31, 1994 and 1993, and the changes in net assets available for
benefits for the years then ended, 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 made for the purpose of forming an opinion on the basic
financial statements taken as a whole. The additional information included in
Schedules I and II is presented for purposes of additional analysis and is not a
required part of the basic financial statements, but is additional information
required by the Employee Retirement Income Security Act of 1974 ("ERISA"). Such
information has been subjected to the auditing procedures applied in the audit
of the basic financial statements and, in our opinion, is fairly stated in all
material respects in relation to the basic financial statements taken as a
whole.
/s/ PRICE WATERHOUSE LLP
- ------------------------
PRICE WATERHOUSE LLP
Washington, D. C.
June 16, 1995
Page 3
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MCI CONSUMER MARKETS 401(k) PLAN
EIN: 13-2745892
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1994
Value of interest in master
trust, at fair value $ 38,102,347
-------------
Net assets available for benefits $ 38,102,347
=============
See accompanying notes to the financial statements.
Page 4
<PAGE>
MCI CONSUMER MARKETS 401(k) PLAN
EIN: 13-2745892
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31,1993
Contribution Receivables:
Employer $ 973,636
Employee 755,806
-----------
Total receivables 1,729,442
-----------
General investments:
Loans to participants 497,683
Value of interest in collective
investment funds of trustee 190,083
Value of interest in registered
investment companies 6,222,934
Value of guaranteed investment
contracts 9,659,522
-----------
Total general investments 16,570,222
-----------
Employer related investments:
Employer securities 9,755,488
-----------
Net assets available for benefits $28,055,152
===========
See accompanying notes to the financial statements.
Page 5
<PAGE>
MCI CONSUMER MARKETS 401(k) PLAN
EIN: 13-2745892
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 1994
ADDITIONS
- ---------
Contributions:
Participants $10,276,746
Non-cash employer 5,878,160
Rollovers 662,020
Non-cash supplemental 3,341,420
------------
Total contributions 20,158,346
------------
Earnings on investments:
Interest on participant loans 79,370
Interest on guaranteed investment contracts 539,178
Dividends on common stock 35,672
Net (loss) on disposition of assets (171,694)
Unrealized (depreciation) of assets (6,068,896)
Net gain from registered investment companies 300,674
------------
Total (losses) earnings on investments (5,285,696)
------------
Total additions 14,872,650
------------
DEDUCTIONS
- ----------
Participant benefit payments 1,872,131
------------
Net increase 13,000,519
Net interfund and interplan transfers (2,968,626)
Net loans 15,302
Net assets available for benefits, at
beginning of year 28,055,152
------------
Net assets available for benefits, at
end of year $38,102,347
============
See accompanying notes to the financial statements.
Page 6
<PAGE>
MCI CONSUMER MARKETS 401(k) PLAN
EIN: 13-2745892
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 1993
ADDITIONS
- ---------
Contributions:
Participants $ 7,153,482
Non-cash employer 3,097,810
Rollovers 69,077
-----------
Total contributions 10,320,369
-----------
Earnings on investments:
Interest on participant loans 9,466
Interest on guaranteed investment contracts 426,037
Dividends on common stock 16,193
Net gain on disposition of assets 74,727
Unrealized appreciation of assets 2,182,318
Net gain from collective investment
funds of trustee 334,875
Net gain from registered investment
companies 415,465
-----------
Total earnings on investments 3,459,081
-----------
Total additions 13,779,450
-----------
DEDUCTIONS
- ----------
Participant benefit payments 818,173
-----------
Net increase 12,961,277
Transfer of assets to the Plan 15,093,875
Net assets available for benefits, at
beginning of year 0
-----------
Net assets available for benefits, at
end of year $28,055,152
===========
See accompanying notes to the financial statements.
Page 7
<PAGE>
MCI CONSUMER MARKETS 401(k) PLAN
EIN: 13-2745892
NOTES TO FINANCIAL STATEMENTS ON FORM 11-K
December 31, 1994 and 1993
NOTE 1 - DESCRIPTION OF THE PLAN
The following brief description of the MCI Consumer Markets 401(k) Plan (the
"Plan" or "401(k)") is provided for general information purposes only.
Participants should refer to the Plan document for more complete information.
The Plan is subject to the applicable provisions of the Employee Retirement
Income Security Act of 1974 ("ERISA").
Effective January 1, 1993, MCI Consumer Markets 401(k) & ESOP Plan was created.
MCI Consumer Markets is a business unit of MCI Telecommunications Corporation
("MCIT"), which is a wholly owned subsidiary of MCI Communications Corporation.
The MCI Consumer Markets 401(k) & ESOP is comprised of two parts: Part I is the
401(k) Plan and Part II is a payroll-based employee stock ownership plan. The
accompanying financial statements are solely those of Part I, the MCI Consumer
Markets 401(k) and are not intended to present the net assets available for
benefits or the changes in net assets available for benefits of the MCI Consumer
Markets 401(k) & ESOP taken as a whole. MCI Communications Corporation,
hereafter known as the Company, separately prepares an annual report on the
overall MCI Consumer Markets 401(k) & ESOP which is submitted to the Internal
Revenue Service ("IRS") on Form 5500 and is made available to all employees upon
request.
Effective January 1, 1994, the assets of the MCI Consumer Markets 401(k) were
combined with those of the MCI Communications Corporation Retirement Savings
Plan ("RSP") into the MCI Communications Corporation Defined Contribution Master
Trust. This change was made to facilitate the modifications set forth in the
paragraphs that follow. Under the terms of the master trust agreement, each plan
has a specific interest in all assets and liabilities of the trust.
The Plan is a defined contribution, deferred savings plan and was amended
effective January 1, 1994. Under the Plan, employees become eligible to
participate upon completion of one year of service with 1,000 hours of service
and attainment of age 21. Eligible employees may elect to defer up to 15% of
eligible compensation on a pre-tax basis, to be contributed to the Plan by the
MCIT on behalf of such employees ("Elective Contributions").
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Prior to January 1, 1994, employees could defer up to 12% of eligible
compensation under the Plan. The first 6% of each participant's Elective
Contribution is eligible for an MCIT matching contribution in the form of MCI
Communications Corporation common stock. Effective January 1, 1994, MCIT's
matching contributions were increased from $.50 to $.67 for each eligible dollar
of Elective Contributions made to the Plan. MCIT's matching contribution is made
biweekly and is determined by the closing price of MCI Communication Corporation
common stock on the date posted to the participants' accounts. Participants'
Elective Contributions are withheld from their biweekly paychecks and MCIT
transfers these contributions to the Plan each pay period. Participants vest in
MCIT's matching contributions at a rate of 20% per year of service and are
always 100% vested in their Elective Contributions. Participants receive a year
of service for vesting purposes for each Plan year during which they complete at
least 1,000 hours of service. As of January 1, 1994, the investment funds
available for elective contributions were increased from four to sixteen funds.
Elective Contributions are invested in any of the sixteen investment funds in
accordance with participants' instructions. The available investment funds are:
- MCI Common Stock Fund
A fund investing in MCI Communications Corporation common stock. These
shares of stock are qualified employer securities as defined by the
Employee Retirement Income Security Act of 1974, as amended.
- EuroPacific Growth Fund
A long term growth fund invested primarily in securities of issuers
domiciled in Europe and the Pacific Basin. The fund's investment
manager is Capital Research and Management Company.
- Putnam Voyager Fund
A long term growth fund invested in a diversified portfolio of two
types of common stocks: emerging growth stocks and opportunity stocks.
The fund is managed by Putnam Investment Management, Inc.
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- Dreyfus S&P 500 Stock Index Portfolio
An equity index mutual fund invested in common stock which is
comparable to the Standard & Poor's 500 Composite Stock Index. All
investment decisions are made by Dreyfus Corporation, an affiliate of
the Plan trustee. The trustee oversees the fund in accordance with the
trust agreement.
- Putnam Actively Managed Balanced Fund
A growth and income fund invested in a blend of three Putnam mutual
funds: Putnam Vista Fund, The Fund for Growth and Income and Putnam
Income Fund. The fund is managed by Putnam Investment Management, Inc.
and is subject to the policies established by the funds' Trustees.
- Scudder Income Fund
An income fund invested primarily in high-grade corporate bonds,
convertible bonds and government securities. The fund's investment
management firm is Scudder, Stevens & Clark, Inc. They manage the
fund's daily investment and business affairs subject to the policies
established by the Board of Trustees of Scudder, Stevens & Clark, Inc.
- Putnam OTC Emerging Growth Fund
A growth and income fund invested primarily in "emerging growth" stocks
traded in the over-the-counter (OTC) market. Putnam Investment
Management, Inc. makes the investment decisions for the fund and is
subject to the policies established by the fund's Trustees.
- Putnam New Opportunities Fund
A growth fund invested primarily in common stock of companies in
economic sectors with above-average prospects for growth. Putnam
Investment Management, Inc. makes the investment decisions for the fund
and is subject to the policies established by the fund's Trustees.
- Putnam Vista Fund
A growth fund invested primarily in well-researched growth stocks of
medium-sized companies. Putnam Investment Management, Inc. makes the
investment decisions for the fund and is subject to the policies
established by the fund's Trustees.
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- Putnam Investors Fund
A growth fund invested primarily in high-quality, domestic, common
stocks. Putnam Investment Management, Inc. makes the investment
decisions for the fund and is subject to the policies established by
the fund's Trustees.
- - The Putnam Fund for Growth and Income
A growth and income fund invested primarily in income-producing stocks,
i.e. stocks that pay high dividends. Putnam Investment Management, Inc.
makes the investment decisions for the fund and is subject to the
policies established by the fund's Trustees.
- Putnam Convertible Income-Growth Trust
An income and growth fund invested primarily in convertible bonds and
convertible preferred stocks, but may also invest in common stock and
other nonconvertible securities. Putnam Investment Management, Inc.
makes the investment decisions for the fund and is subject to the
policies established by the fund's Trustees.
- Putnam High Yield Advantage Fund
An income fund invested primarily in lower rated bonds ("junk bonds").
Putnam Investment Management, Inc. makes the investment decisions for
the fund and is subject to the policies established by the fund's
Trustees.
- Putnam Global Government Income Trust
A non-diversified income fund invested principally in debt securities
of foreign or U.S. governmental entities, including supranational
issuers. Putnam Investment Management, Inc. makes the investment
decisions for the fund and is subject to the policies established by
the fund's Trustees.
- Putnam Diversified Income Trust
An income fund invested primarily in U.S. government, high yield and
international fixed income securities. Putnam Investment Management,
Inc. makes the investment decisions for the fund and is subject to the
policies established by the fund's Trustees.
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- Stable Asset Fund
The fund consists primarily of guaranteed investment contracts (GICs)
issued by insurance companies and contracts with other financial
institutions that offer fixed interest rates on investments. This fund
was formerly known as the Long-Term Fixed Income Fund. The fund seeks
to maintain a constant book value of $1.00 per share. The guaranteed
rates of interest range from 5.6% to 9.1% at December 31, 1994.
This fund also includes investment in the Mellon Bank Temporary
Investment Fund (TIF) to satisfy any liquidity needs and also serves as
a temporary account to hold funds from maturing interests.
Each individual's investment in the funds is recorded in their participant
account on a unit value basis with the exception of MCI Common Stock which is
recorded on a per share basis. The Plan is processed on a daily valuation basis.
Prior to January 1, 1994, all funds, with the exception of the MCI Common Stock
fund, were tracked on a dollar valuation basis and were processed on a monthly
valuation basis.
Participants may transfer all or part of the balance in their Elective
Contributions and related earnings in any fund to any other fund once each
calendar month. Participants may reallocate their matching contributions balance
as of the prior year end once per Plan Year for account balances that are 100%
vested. Participants may change the allocation of their future contributions
among funds with unlimited frequency. Participants' allocations are affected by
the last change placed prior to payroll processing.
In accordance with the terms of the Plan, MCIT is entitled to make a
supplemental contribution to the Plan, either in cash or shares of the Company's
common stock, in amounts as determined by MCIT's Board of Directors. The
supplemental contributions are allocated among Plan participants at the end of
each Plan year based on their eligible compensation. Participants become vested
in their share of the supplemental contribution at the rate of 20% per year of
credited service. During the year ended December 31, 1994, a supplemental
contribution of 1.87% of the eligible compensation of all employees who have
fulfilled the eligibility requirements for the Plan was made. This contribution
in the amount of $3,341,420, was made in the form of 146,073 shares of the
Company's common stock.
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The Plan allows participants to borrow up to one-half of their vested account
balances (or $50,000, whichever is less). The minimum loan amount is $1,000 and
the minimum term of a loan is one year. The maximum term of a loan is five years
for a general purpose loan and fifteen years for a primary residence loan. Only
one loan of each type, general purpose and primary residence, may be outstanding
at any time. Loan proceeds are disbursed pro rata from each of the participants'
investment funds, and are repaid through biweekly payroll deductions. Loan
repayments of principal and interest are invested based on the participants'
current investment elections. Interest rates for new loans are determined
monthly based on the prime rate as published on the first business day of each
month in The Wall Street Journal, plus one percentage point. The interest rate
is fixed for the term of the loan. Loans can be repaid in full by a cashier's or
certified check. During the Plan years ended December 31, 1994 and 1993,
$1,744,248 and $333,910 in loans were disbursed and principal repayments of
$488,556 and $92,578, respectively, were made.
Certain participants have the right to diversify a portion of their account in
the Employee Stock Ownership Plan (ESOP), Part II of the MCI Consumer Markets
401(k) & ESOP and transfer a portion of their account to the 401(k).
Participants in the ESOP, who have attained at least 55 years of age and have
been a member of the ESOP for at least ten years, are eligible to diversify
under these provisions. There were no ESOP diversifications to the 401(k) during
1994 and 1993.
Distribution of the benefits in a participant's Plan account is normally made
only after the participant ceases to be an employee of MCIT. However, the
account balance of a participant's Elective Contributions may be withdrawn prior
to termination of employment if the participant can demonstrate an economic
hardship (as defined in the Plan). Upon termination of employment, a participant
receives all vested assets in his individual account. Non-vested portions of a
terminated participant's account are forfeited and used to offset future MCIT
matching contributions. As of December 31, 1994 and 1993, forfeitures included
in the Plan were $143,283 and $64,015, respectively, which included 6,159 and
1,589 forfeited shares of MCI Communications Corporation common stock, at
year-end fair market values of $113,172 and $44,889, respectively.
The Plan is not a defined benefit plan and accordingly, Plan benefits are not
guaranteed by the Pension Benefit Guaranty Corporation. MCIT is the plan
administrator and has appointed an Administrative Committee to administer the
Plan. The
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Administrative Committee is responsible for carrying out the provisions of the
Plan and may employ such experts as deemed necessary. Plan assets are held by
the trustee, Mellon Bank, N.A. of Pittsburgh, Pennsylvania. The recordkeeper for
the Plan is Putnam Investments, Inc. MCIT reserves its rights under the Plan to
discontinue its contributions and to terminate the Plan at any time. Upon such
termination, all amounts funded shall become nonforfeitable and shall be
provided for and paid from the Plan's trust in accordance with the order of
priority set forth in Section 4044 of the Employee Retirement Income Security
Act of 1974. MCIT has not expressed any intention to discontinue its
contributions nor to terminate the Plan.
The Plan's holdings of MCI Communications Corporation Common Stock, various
Putnam Investment, Inc. mutual funds, and a Mellon Bank mutual fund and
collective trust account are party-in-interest investments.
NOTE 2 - MASTER TRUST
Effective January 1, 1994, MCI Communications Corporation established The MCI
Communications Corporation Defined Contribution Master Trust (the "Master
Trust"), for the purpose of facilitating modifications to the Plan. The Master
Trust is intended to be a tax-exempt trust within the meaning of Section 501(a)
of the Internal Revenue Code. The administration of the Master Trust is the
responsibility of the trustee. All Plan investments are included in the Master
Trust.
The Master Trust consists of a pool of individual investments in which the RSP
and the Plan have a shared participation through Master Trust units. Net assets
and net investment gains and losses are allocated to each participating plan
based on units of participation held by the respective plans. Each unit
represents a proportionate, specific interest in the Master Trust. The Plan had
a specific interest in the Master Trust of $38,102,347 representing
approximately 10% of the net assets of the Master Trust as of December 31, 1994.
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The fund information below presents the percentage interest of each plan in the
Master Trust using specific identification:
Master Trust Percentage Interest
Plan Name Investment Account December 31, 1994
- --------------------- ---------------------------------- -------------------
MCI Communications EuroPacific Growth Fund 89.12%
Corporation Putnam Balanced Fund 89.02%
Retirement Savings Scudder Income Fund 89.78%
Plan Dreyfus S&P 500 Stock Index 88.08%
EIN: 52-0886267 Putnam Growth & Income 88.94%
Putnam Investors Fund 92.62%
Putnam Vista Fund 91.62%
Putnam Voyager Fund 92.79%
Putnam Convertible Income-Growth 93.25%
Putnam High Yield Advantage 90.68%
Putnam Global Gov't Income 91.76%
Putnam OTC Emerging Growth 92.09%
Putnam Diversified Income 86.85%
Stable Asset Fund 89.64%
Putnam New Opportunities 91.81%
MCI Common Stock 89.95%
Loan Fund 88.55%
MCI Consumer Markets EuroPacific Growth Fund 10.88%
401(k) Plan Putnam Balanced Fund 10.98%
EIN: 13-2745892 Scudder Income Fund 10.22%
Dreyfus S&P 500 Stock Index 11.92%
Putnam Growth & Income 11.06%
Putnam Investors Fund 7.38%
Putnam Vista Fund 8.38%
Putnam Voyager Fund 7.21%
Putnam Convertible Income-Growth 6.75%
Putnam High Yield Advantage 9.32%
Putnam Global Gov't Income 8.24%
Putnam OTC Emerging Growth 7.91%
Putnam Diversified Income 13.15%
Stable Asset Fund 10.36%
Putnam New Opportunities 8.19%
MCI Common Stock Fund 10.05%
Loan Fund 11.45%
The following pages present the assets and results of operations for the Master
Trust in which the Plan and RSP participate.
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<TABLE>
<CAPTION>
MCI COMMUNICATIONS CORPORATION
DEFINED CONTRIBUTION MASTER TRUST
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
DECEMBER 31, 1994
EuroPacific Putnam Scudder Dreyfus Putnam Putnam
Growth Balanced Income S&P 500 Growth & Investors
Fund Fund Fund Stock Index Income Fund
ASSETS ----------- ----------- ----------- ------------ ----------- ---------
------
<S> <C> <C> <C> <C> <C> <C>
Contribution receivables:
Employee $ 10,921 $ 6,530 $ 3,005 $ 21,810 $ 2,677 $ 640
Employer 0 0 0 0 0 0
----------- ----------- ----------- ------------ ----------- ---------
Total contribution receivables 10,921 6,530 3,005 21,810 2,677 640
Other receivables 8,777 5,944 0 30,605 348 182
Investments, at fair value:
Common stock 0 0 0 0 0 0
Common/collective trusts 0 0 0 125 0 0
Registered investment companies 6,427,590 3,512,185 1,874,242 36,015,159* 1,909,296 430,005
Participant loans 0 0 0 0 0 0
Investments, at contract value:
Value of guaranteed investment contracts 0 0 0 0 0 0
----------- ----------- ----------- ------------ ----------- ---------
Total assets 6,447,288 3,524,659 1,877,247 36,067,699 1,912,321 430,827
----------- ----------- ----------- ------------ ----------- ---------
LIABILITIES
-----------
Operating payables 0 0 5,764 0 0 0
----------- ----------- ----------- ------------ ----------- ---------
Net assets available for benefits 6,447,288 $3,524,659 $1,871,483 $36,067,699 $1,912,321 $430,827
=========== =========== =========== ============ =========== =========
Participating Plan Interests
- ----------------------------
MCI Communications Retirement Savings Plan $5,746,106 $3,137,589 $1,680,310 $31,769,787 $1,700,841 $399,028
MCI Consumer Markets 401(k) Plan 701,182 387,070 191,173 4,297,912 211,480 31,799
----------- ----------- ----------- ------------ ----------- ---------
Total $6,447,288 $3,524,659 $1,871,483 $36,067,699 $1,912,321 $430,827
=========== =========== =========== ============ =========== =========
<FN>
* Investment represents 5% or more of the Trust's net assets.
</FN>
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
MCI COMMUNICATIONS CORPORATION
DEFINED CONTRIBUTION MASTER TRUST
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
DECEMBER 31, 1994
Putnam Putnam Putnam Putnam Putnam Putnam
Vista Voyager Convertible High Yield Global Gov't OTC Emerging
Fund Fund Income-Growth Advantage Income Growth
ASSETS --------- ------------ ------------- ---------- ------------ ------------
------
<S> <C> <C> <C> <C> <C> <C>
Contribution receivables:
Employee $ 1,016 $ 33,483 $ 916 $ 460 $ 407 $ 3,470
Employer 0 0 0 0 0 0
--------- ------------ ------------- ---------- ------------ ------------
Total contribution receivables 1,016 33,483 916 460 407 3,470
Other receivables 16,940 53,553 3,967 0 492 7,382
Investments, at fair value:
Common stock 0 0 0 0 0 0
Common/collective trusts 0 1,588 0 0 0 0
Registered investment companies 970,118 62,645,356* 709,251 419,598 212,661 3,032,240
Participant loans 0 0 0 0 0 0
Investments, at contract value:
Value of guaranteed investment contracts 0 0 0 0 0 0
--------- ------------ ------------- ---------- ------------ ------------
Total assets 988,074 62,733,980 714,134 420,058 213,560 3,043,092
--------- ------------ ------------- ---------- ------------ ------------
LIABILITIES
-----------
Operating payables 0 0 0 3,944 0 0
--------- ------------ ------------- ---------- ------------ ------------
Net assets available for benefits $988,074 $62,733,980 $ 714,134 $ 416,114 $ 213,560 $ 3,043,092
========= ============ ============= ========== ============ ============
Participating Plan Interests
- ----------------------------
MCI Communications Retirement Savings Plan $905,290 $58,211,117 $ 665,896 $ 377,317 $ 195,954 $ 2,802,380
MCI Consumer Markets 401(k) Plan 82,784 4,522,863 48,238 38,797 17,606 240,712
--------- ------------ ------------- ---------- ------------ ------------
Total $988,074 $62,733,980 $ 714,134 $ 416,114 $ 213,560 $ 3,043,092
========= ============ ============= ========== ============ ============
<FN>
* Investment represents 5% or more of the Trust's net assets.
</FN>
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
MCI COMMUNICATIONS CORPORATION
DEFINED CONTRIBUTION MASTER TRUST
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
DECEMBER 31, 1994
Putnam Stable Putnam MCI
Diversified Asset New Common Loan
Income Fund Opportunities Stock Fund Total
ASSETS ----------- ------------- ------------- ------------- ------------ -------------
------
<S> <C> <C> <C> <C> <C> <C>
Contribution receivables:
Employee $ 344 $ 50,801 $ 2,896 $ 58,178 $ 0 $ 197,554
Employer 0 0 0 117,255 0 117,255
----------- ------------- ------------- ------------- ------------ -------------
Total contribution receivables 344 50,801 2,896 175,433 0 314,809
Other receivables 3,936 1,893 0 7 0 134,026
Investments, at fair value:
Common stock 0 0 0 146,194,183* 0 146,194,183
Common/collective trusts 0 1,406,194 0 4,390 0 1,412,297
Registered investment companies 359,063 0 4,615,388 0 0 123,132,152
Participant loans 0 0 0 0 15,941,326 15,941,326
Investments, at contract value:
Value of guaranteed investment contracts 0 98,544,375* 0 0 0 98,544,375
----------- ------------- ------------- ------------- ------------ -------------
Total assets 363,343 100,003,263 4,618,284 146,374,013 15,941,326 385,673,168
----------- ------------- ------------- ------------- ------------ -------------
LIABILITIES
-----------
Operating payables 0 0 271 0 0 9,979
----------- ------------- ------------- ------------- ------------ -------------
Net assets available for benefits $ 363,343 $100,003,263 $ 4,618,013 $146,374,013 $15,941,326 $385,663,189
=========== ============= ============= ============= ============ =============
Participating Plan Interests
- ----------------------------
MCI Communications Retirement Savings Plan $ 315,561 $ 89,640,220 $ 4,239,947 $131,656,672 $14,116,827 $347,560,842
MCI Consumer Markets 401(k) Plan 47,782 10,363,043 378,066 14,717,341 1,824,499 38,102,347
----------- ------------- ------------- ------------- ------------ -------------
Total $ 363,343 $100,003,263 $ 4,618,013 $146,374,013 $15,941,326 $385,663,189
=========== ============= ============= ============= ============ =============
<FN>
* Investment represents 5% or more of the Trust's net assets.
</FN>
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
MCI COMMUNICATIONS CORPORATION
DEFINED CONTRIBUTION MASTER TRUST
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 1994
EuroPacific Putnam Scudder Dreyfus Putnam Putnam
Growth Balanced Income S&P 500 Growth & Investors
Fund Fund Fund Stock Index Income Fund
ADDITIONS ----------- ----------- ----------- ------------ ----------- ---------
- --------
<S> <C> <C> <C> <C> <C> <C>
Contributions:
Participants $2,783,794 $1,612,533 $ 790,928 $ 8,365,101 $ 675,924 $157,084
Non-cash employer 0 0 0 0 0 0
Rollovers 1,024,708 1,186,247 768,095 662,500 807,794 164,611
Non-cash supplemental 0 0 0 0 0 0
Transfers from ESOP 12,329 11,688 4,728 10,332 9,873 2,130
----------- ----------- ----------- ------------ ----------- ---------
Total contributions 3,820,831 2,810,468 1,563,751 9,037,933 1,493,591 323,825
----------- ----------- ----------- ------------ ----------- ---------
Earnings on investments:
Interest on participant loans 0 0 0 0 0 0
Interest on guaranteed investment contracts 0 0 0 0 0 0
Dividends on common stock 0 0 0 0 0 0
Net (loss) on disposition of assets 0 0 0 0 0 0
Unrealized (depreciation) of assets 0 0 0 0 0 0
Net (loss) gain from registered investment
companies (40,315) 5,979 9,607 457,771 15,906 1,297
----------- ----------- ----------- ------------ ----------- ---------
Total (losses) earnings on investments (40,315) 5,979 9,607 457,771 15,906 1,297
----------- ----------- ----------- ------------ ----------- ---------
Total additions 3,780,516 2,816,447 1,573,358 9,495,704 1,509,497 325,122
DEDUCTIONS
- ----------
Participant benefit payments 78,712 20,896 18,709 1,051,210 13,612 2,227
----------- ----------- ----------- ------------ ----------- ---------
Net increase 3,701,804 2,795,551 1,554,649 8,444,494 1,495,885 322,895
Transfers from (to):
Other master trust investment accounts 2,788,105 813,772 362,821 (3,044,215) 470,858 115,520
Net loans (42,621) (84,664) (45,987) (1,114,907) (54,422) (7,588)
Western Union International Collectively
Bargained Plan 0 0 0 11,486 0 0
Net assets available for benefits, at
beginning of year 0 0 0 31,770,841 0 0
----------- ----------- ----------- ------------ ----------- ---------
Net assets available for benefits, at
end of year $6,447,288 $3,524,659 $1,871,483 $36,067,699 $1,912,321 $430,827
=========== =========== =========== ============ =========== =========
</TABLE>
Page 19
<PAGE>
<TABLE>
<CAPTION>
MCI COMMUNICATIONS CORPORATION
DEFINED CONTRIBUTION MASTER TRUST
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 1994
Putnam Putnam Putnam Putnam Putnam Putnam
Vista Voyager Convertible High Yield Global Gov't OTC Emerging
Fund Fund Income-Growth Advantage Income Growth
ADDITIONS --------- ------------ ------------- ---------- ------------ ------------
- ---------
<S> <C> <C> <C> <C> <C> <C>
Contributions:
Participants $340,241 $15,026,938 $ 276,157 $ 168,550 $ 88,997 $ 1,288,038
Non-cash employer 0 0 0 0 0 0
Rollovers 437,051 1,549,601 317,076 205,946 74,972 642,623
Non-cash supplemental 0 0 0 0 0 0
Transfers from ESOP 8,388 10,763 1,250 4,509 9,392 5,501
--------- ------------ ------------- ---------- ------------ ------------
Total contribution 785,680 16,587,302 594,483 379,005 173,361 1,936,162
--------- ------------ ------------- ---------- ------------ ------------
Earnings on investments:
Interest on participant loans 0 0 0 0 0 0
Interest on guaranteed investment contracts 0 0 0 0 0 0
Dividends on common stock 0 0 0 0 0 0
Net (loss) on disposition of assets 0 0 0 0 0 0
Unrealized (depreciation) of assets 0 0 0 0 0 0
Net (loss) gain from registered investment
companies 3,250 590,284 (2,103) (10,943) (5,915) 242,285
--------- ------------ ------------- ---------- ------------ ------------
Total (losses) earnings on investments 3,250 590,284 (2,103) (10,943) (5,915) 242,285
--------- ------------ ------------- ---------- ------------ ------------
Total additions 788,930 17,177,586 592,380 368,062 167,446 2,178,447
DEDUCTIONS
- ----------
Participant benefit payments 7,118 1,885,218 3,112 3,332 264 20,806
--------- ------------ ------------- ---------- ------------ ------------
Net increase 781,812 15,292,368 589,268 364,730 167,182 2,157,641
Transfers from (to):
Other master trust investment accounts 237,960 (2,989,223) 137,008 71,319 50,580 914,427
Net loans (31,698) (1,955,198) (12,142) (19,935) (4,202) (28,976)
Western Union International Collectively
Bargained Plan 0 9,774 0 0 0 0
Net assets available for benefits, at
beginning of year 0 52,376,259 0 0 0 0
--------- ------------ ------------- ---------- ------------ ------------
Net assets available for benefits, at
end of year $988,074 $62,733,980 $ 714,134 $ 416,114 $ 213,560 $ 3,043,092
========= ============ ============= ========== ============ ============
</TABLE>
Page 20
<PAGE>
<TABLE>
<CAPTION>
MCI COMMUNICATIONS CORPORATION
DEFINED CONTRIBUTION MASTER TRUST
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 1994
Putnam Stable Putnam MCI
Diversified Asset New Common Loan
Income Fund Opportunities Stock Fund Total
ADDITIONS ----------- ------------- ------------- ------------- ------------ -------------
- ---------
<S> <C> <C> <C> <C> <C> <C>
Contributions:
Participants $ 109,922 $ 12,963,883 $ 1,669,859 $ 15,866,347 $ 0 $ 62,184,296
Non-cash employer 0 0 0 34,411,079 0 34,411,079
Rollovers 445,952 2,679,107 1,181,940 1,237,619 0 13,385,842
Non-cash supplemental 0 0 0 20,000,002 0 20,000,002
Transfers from ESOP 2,252 11,732 6,156 52,082 0 163,105
----------- ------------- ------------- ------------- ------------ -------------
Total contributions 558,126 15,654,722 2,857,955 71,567,129 0 130,144,324
----------- ------------- ------------- ------------- ------------ -------------
Earnings on investments:
Interest on participant loans 0 0 0 0 761,327 761,327
Interest on guaranteed investment contracts 0 6,131,620 0 0 0 6,131,620
Dividends on common stock 0 0 0 339,260 0 339,260
Net (loss) on disposition of assets 0 0 0 (1,417,410) 0 (1,417,410)
Unrealized (depreciation) of assets 0 0 0 (63,481,865) 0 (63,481,865)
Net (loss) gain from registered investment
companies (6,865) 0 315,778 0 0 1,576,016
----------- ------------- ------------- ------------- ------------ -------------
Total (losses) earnings on investments (6,865) 6,131,620 315,778 (64,560,015) 761,327 (56,091,052)
----------- ------------- ------------- ------------- ------------ -------------
Total additions 551,261 21,786,342 3,173,733 7,007,114 761,327 74,053,272
DEDUCTIONS
- ----------
Participant benefit payments 2,643 4,605,500 32,954 6,509,482 723,204 14,978,999
----------- ------------- ------------- ------------- ------------ -------------
Net increase 548,618 17,180,842 3,140,779 497,632 38,123 59,074,273
Transfers from (to):
Other master trust investment accounts (169,241) (4,322,644) 1,573,958 2,988,995 0 0
Net loans (16,034) (3,204,872) (96,724) (2,069,439) 8,791,674 2,265
Western Union International Collectively
Bargained Plan 0 44,413 0 42,169 3,279 111,121
Net assets available for benefits, at
beginning of year 0 90,305,524 0 144,914,656 7,108,250 326,475,530
----------- ------------- ------------- ------------- ------------ -------------
Net assets available for benefits, at
end of year $ 363,343 $100,003,263 $ 4,618,013 $146,374,013 $15,941,326 $385,663,189
=========== ============= ============= ============= ============ =============
</TABLE>
Page 21
<PAGE>
<TABLE>
<CAPTION>
MCI CONSUMER MARKETS 401(k) PLAN
EIN: 13-2745892
SCHEDULE OF MASTER TRUST PARTICIPATION
Current Value of Interest Year Ended December 31, 1994
---------------------------- ---------------------------------------------------------------------
Participant Net
December 31, January 1, Benefit (Depreciation)
Investment Account Interest: 1994 1994 Contributions Payments Net Loans Net Transfers Appreciation
------------- ------------ ------------- -------------- ------------ ------------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
EuroPacific Growth Fund $ 701,182 $ 0 $ 436,832 $ (11,756) $ 1,372 $ 280,945 $ (6,211)
Putnam Balanced Fund 387,070 0 304,422 (3,010) (8,854) 94,069 443
Scudder Income Fund 191,173 0 189,434 (1,939) (13,191) 9,671 7,198
Dreyfus S&P 500 Stock Index 4,297,912 2,886,395 1,363,946 (145,042) (150,403) 238,814 104,202
Putnam Growth & Income 211,480 0 138,952 (1,701) (15,845) 90,278 (204)
Putnam Investors Fund 31,799 0 21,030 (79) (259) 10,991 116
Putnam Vista Fund 82,784 0 45,622 (104) (2,918) 40,122 62
Putnam Voyager Fund 4,522,863 3,392,532 2,167,039 (170,409) (201,837) (823,326) 158,864
Putnam Convertible Income-Growth 48,238 0 43,302 (123) (336) 5,840 (445)
Putnam High Yield Advantage 38,797 0 34,662 (655) (4,294) 10,205 (1,121)
Putnam Global Gov't Income 17,606 0 14,692 (26) 400 2,952 (412)
Putnam OTC Emerging Growth 240,712 0 170,262 (588) (3,035) 53,847 20,226
Putnam Diversified Income 47,782 0 37,633 (25) (8,660) 20,903 (2,069)
Stable Asset Fund 10,363,043 9,902,851 2,741,937 (648,983) (582,405) (1,589,535) 539,178
Putnam New Opportunities 378,066 0 244,281 (1,366) (2,313) 117,439 20,025
MCI Common Stock 14,717,341 11,375,691 12,204,300 (826,360) (183,656) (1,647,716) (6,204,918)
Loan Fund
(interest rates range 7% - 11%) 1,824,499 497,683 0 (59,965) 1,191,536 115,875 79,370
-------------- -------------- ------------- -------------- ------------ ------------- -------------
Total $ 38,102,347 $ 28,055,152 $ 20,158,346 $ (1,872,131) $ 15,302 $ (2,968,626) $ (5,285,696)
============== ============== ============= ============== ============ ============= =============
</TABLE>
Page 22
<PAGE>
NOTE 3 - DESCRIPTION OF ACCOUNTING PRINCIPLES AND PRACTICES
The financial statements for the Plan are prepared on the accrual basis of
accounting.
The Plan's distribution of the Company's common stock to participants is the
fair market value as of the distribution date. The difference between the fair
market value on the date of distribution and the carrying value to the Plan of
the distributed shares is recorded as a net gain or loss on disposition of
assets. Purchase and sales of securities are recorded on the trade date.
The Plan's interest in registered investment companies and employer securities
are stated at fair value, measured by the quoted current market price. Units in
collective trusts are valued at the net asset value as reported by such trusts
at the end of each period. Funds invested in guaranteed investment contracts are
stated at contract value, measured as cost plus earned interest income.
Administrative expenses of the Plan are paid by the Company.
NOTE 4 - NET ASSETS AVAILABLE FOR BENEFITS AND CHANGES IN NET ASSETS AVAILABLE
FOR BENEFITS BY FUND
The allocation of net assets available for benefits and the changes in net
assets among the Plan's investment funds for the years ended December 31, 1994
and 1993 are presented on the following pages. Certain prior year information
has been reclassified to conform with the current year presentation.
Page 23
<PAGE>
<TABLE>
<CAPTION>
MCI CONSUMER MARKETS 401(k) PLAN
EIN: 13-2745892
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
DECEMBER 31, 1994
EuroPacific Putnam Scudder Dreyfus Putnam Putnam
Growth Balanced Income S&P 500 Growth & Investors
Fund Fund Fund Stock Index Income Fund
----------- ----------- ----------- ------------ ----------- ---------
ASSETS
------
<S> <C> <C> <C> <C> <C> <C>
Contribution receivables:
Employee $ 10,921 $ 6,530 $ 3,005 $ 21,810 $ 2,677 $ 640
Employer 0 0 0 0 0 0
----------- ----------- ----------- ------------ ----------- ---------
Total contribution receivables 10,921 6,530 3,005 21,810 2,677 640
Other receivables 3,554 1,018 48 10,036 19 0
Investments, at fair value:
Common stock 0 0 0 0 0 0
Common/collective trusts 0 0 0 15 0 0
Registered investment companies 686,707 379,522 188,120 4,266,051* 208,784 31,159
Participant loans 0 0 0 0 0 0
Investments, at contract value:
Value of guaranteed investment contracts 0 0 0 0 0 0
----------- ----------- ----------- ------------ ----------- ---------
Total assets 701,182 387,070 191,173 4,297,912 211,480 31,799
----------- ----------- ----------- ------------ ----------- ---------
LIABILITIES
-----------
Operating payables 0 0 0 0 0 0
----------- ----------- ----------- ------------ ----------- ---------
Net assets available for benefits $ 701,182 $ 387,070 $ 191,173 $ 4,297,912 $ 211,480 $ 31,799
=========== =========== =========== ============ =========== =========
<FN>
* Investment represents 5% or more of the Trust's net assets.
</FN>
</TABLE>
Page 24
<PAGE>
<TABLE>
<CAPTION>
MCI CONSUMER MARKETS 401(k) PLAN
EIN: 13-2745892
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
DECEMBER 31, 1994
Putnam Putnam Putnam Putnam Putnam Putnam
Vista Voyager Convertible High Yield Global Gov't OTC Emerging
Fund Fund Income-Growth Advantage Income Growth
--------- ------------ ------------- ---------- ------------ ------------
ASSETS
------
<S> <C> <C> <C> <C> <C> <C>
Contribution receivables:
Employee $ 1,016 $ 33,483 $ 916 $ 460 $ 407 $ 3,470
Employer 0 0 0 0 0 0
--------- ------------ ------------- ---------- ------------ ------------
Total contribution receivables 1,016 33,483 916 460 407 3,470
Other receivables 0 9,988 83 57 0 84
Investments, at fair value:
Common stock 0 0 0 0 0 0
Common/collective trusts 0 114 0 0 0 0
Registered investment companies 81,768 4,479,278* 47,239 38,280 17,199 237,158
Participant loans 0 0 0 0 0 0
Investments, at contract value:
Value of guaranteed investment contracts 0 0 0 0 0 0
--------- ------------ ------------- ---------- ------------ ------------
Total assets 82,784 4,522,863 48,238 38,797 17,606 240,712
--------- ------------ ------------- ---------- ------------ ------------
LIABILITIES
-----------
Operating payables 0 0 0 0 0 0
--------- ------------ ------------- ---------- ------------ ------------
Net assets available for benefits $ 82,784 $ 4,522,863 $ 48,238 $ 38,797 $ 17,606 $ 240,712
========= ============ ============= ========== ============ ============
<FN>
* Investment represents 5% or more of the Trust's net assets.
</FN>
</TABLE>
Page 25
<PAGE>
<TABLE>
<CAPTION>
MCI CONSUMER MARKETS 401(k) PLAN
EIN: 13-2745892
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
DECEMBER 31, 1994
Putnam Stable Putnam MCI
Diversified Asset New Common Loan
Income Fund Opportunities Stock Fund Total
----------- ------------- ------------- ------------- ------------ -------------
ASSETS
------
<S> <C> <C> <C> <C> <C> <C>
Contribution receivables:
Employee $ 344 $ 50,801 $ 2,896 $ 58,178 $ 0 $ 197,554
Employer 0 0 0 117,255 0 117,255
----------- ------------- ------------- ------------- ------------ -------------
Total contribution receivables 344 50,801 2,896 175,433 0 314,809
Other receivables 0 196 0 1 0 25,084
Investments, at fair value:
Common stock 0 0 0 14,541,466* 0 14,541,466
Common/collective trusts 0 145,682 0 441 0 146,252
Registered investment companies 47,438 0 379,389 0 0 11,088,092
Participant loans 0 0 0 0 1,824,499 1,824,499
Investments, at contract value:
Value of guaranteed investment contracts 0 10,166,364* 0 0 0 10,166,364
----------- ------------- ------------- ------------- ------------ -------------
Total assets 47,782 10,363,043 382,285 14,717,341 1,824,499 38,106,566
----------- ------------- ------------- ------------- ------------ -------------
LIABILITIES
-----------
Operating payables 0 0 4,219 0 0 4,219
----------- ------------- ------------- ------------- ------------ -------------
Net assets available for benefits $ 47,782 $ 10,363,043 $ 378,066 $ 14,717,341 $ 1,824,499 $ 38,102,347
=========== ============= ============= ============= ============ =============
<FN>
* Investment represents 5% or more of the Trust's net assets.
</FN>
</TABLE>
Page 26
<PAGE>
<TABLE>
<CAPTION>
MCI CONSUMER MARKETS 401(k) PLAN
EIN: 13-2745892
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
DECEMBER 31, 1993
Putnam Stable Laurel MCI
Voyager Asset S&P 500 Common Loan
Fund Fund Stock Index Stock Fund Total
------------ ------------- ------------ ------------- ----------- --------------
ASSETS
------
<S> <C> <C> <C> <C> <C> <C>
Contribution receivables:
Employee $ 32,470 $ 53,246 $ 23,523 $ 646,567 $ 0 $ 755,806
Employer 0 0 0 973,636 0 973,636
------------ ------------- ------------ ------------- ----------- --------------
Total contribution receivables 32,470 53,246 23,523 1,620,203 0 1,729,442
------------ ------------- ------------ ------------- ----------- --------------
Investments, at fair value:
Common stock 0 0 0 9,755,488* 0 9,755,488
Common/collective trusts 0 190,083 0 0 0 190,083
Registered investment companies 3,360,062* 0 2,862,872* 0 0 6,222,934
Participant loans 0 0 0 0 497,683 497,683
Investments, at contract value:
Value of guaranteed investment contracts 0 9,659,522* 0 0 0 9,659,522
------------ ------------- ------------ ------------- ----------- --------------
Total investments, at fair value 3,360,062 9,849,605 2,862,872 9,755,488 497,683 26,325,710
------------ ------------- ------------ ------------- ----------- --------------
Total assets 3,392,532 9,902,851 2,886,395 11,375,691 497,683 28,055,152
------------ ------------- ------------ ------------- ----------- --------------
LIABILITIES
-----------
Operating payables 0 0 0 0 0 0
------------ ------------- ------------ ------------- ----------- --------------
Net assets available for benefits $ 3,392,532 $ 9,902,851 $ 2,886,395 $ 11,375,691 $ 497,683 $ 28,055,152
============ ============= ============ ============= =========== ==============
<FN>
* Investment represents 5% or more of the Trust's net assets.
</FN>
</TABLE>
Page 27
<PAGE>
<TABLE>
<CAPTION>
MCI CONSUMER MARKETS 401(k) PLAN
EIN: 13-2745892
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 1994
EuroPacific Putnam Scudder Dreyfus Putnam Putnam
Growth Balanced Income S&P 500 Growth & Investors
Fund Fund Fund Stock Index Income Fund
ADDITIONS ----------- ----------- ----------- ------------ ----------- ---------
- ---------
<S> <C> <C> <C> <C> <C> <C>
Contributions:
Participants $ 395,022 $ 239,537 $ 115,919 $ 1,340,969 $ 96,313 $ 20,287
Non-cash employer 0 0 0 0 0 0
Rollovers 41,810 64,885 73,515 22,977 42,639 743
Non-cash supplemental 0 0 0 0 0 0
----------- ----------- ----------- ------------ ----------- ---------
Total contributions 436,832 304,422 189,434 1,363,946 138,952 21,030
----------- ----------- ----------- ------------ ----------- ---------
Earnings on investments:
Interest on participant loans 0 0 0 0 0 0
Interest on guaranteed investment contracts 0 0 0 0 0 0
Dividends on common stock 0 0 0 0 0 0
Net (loss) on disposition of assets 0 0 0 0 0 0
Unrealized (depreciation) of assets 0 0 0 0 0 0
Net (loss) gain from registered investment
companies (6,211) 443 7,198 104,202 (204) 116
----------- ----------- ----------- ------------ ----------- ---------
Total (losses) earnings on investments (6,211) 443 7,198 104,202 (204) 116
----------- ----------- ----------- ------------ ----------- ---------
Total additions 430,621 304,865 196,632 1,468,148 138,748 21,146
DEDUCTIONS
- ----------
Participant benefit payments 11,756 3,010 1,939 145,042 1,701 79
----------- ----------- ----------- ------------ ----------- ---------
Net increase 418,865 301,855 194,693 1,323,106 137,047 21,067
Transfers from (to):
Other master trust investment accounts 274,580 68,267 8,051 (256,204) 80,675 10,856
Net loans 1,372 (8,854) (13,191) (150,403) (15,845) (259)
MCI Communications Retirement Savings Plan 6,365 25,802 1,620 495,018 9,603 135
Net assets available for benefits, at
beginning of year 0 0 0 2,886,395 0 0
----------- ----------- ----------- ------------ ----------- ---------
Net assets available for benefits, at
end of year $ 701,182 $ 387,070 $ 191,173 $ 4,297,912 $ 211,480 $ 31,799
=========== =========== =========== ============ =========== =========
</TABLE>
Page 28
<PAGE>
<TABLE>
<CAPTION>
MCI CONSUMER MARKETS 401(k) PLAN
EIN: 13-2745892
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 1994
Putnam Putnam Putnam Putnam Putnam Putnam
Vista Voyager Convertible High Yield Global Gov't OTC Emerging
Fund Fund Income-Growth Advantage Income Growth
ADDITIONS --------- ------------ ------------- ---------- ------------ ------------
- ---------
<S> <C> <C> <C> <C> <C> <C>
Contributions:
Participants $ 35,573 $ 2,109,536 $ 35,019 $ 23,147 $ 14,071 $ 152,836
Non-cash employer 0 0 0 0 0 0
Rollovers 10,049 57,503 8,283 11,515 621 17,426
Non-cash supplemental 0 0 0 0 0 0
--------- ------------ ------------- ---------- ------------ ------------
Total contributions 45,622 2,167,039 43,302 34,662 14,692 170,262
--------- ------------ ------------- ---------- ------------ ------------
Earnings on investments:
Interest on participant loans 0 0 0 0 0 0
Interest on guaranteed investment contracts 0 0 0 0 0 0
Dividends on common stock 0 0 0 0 0 0
Net (loss) on disposition of assets 0 0 0 0 0 0
Unrealized (depreciation) of assets 0 0 0 0 0 0
Net (loss) gain from registered investment
companies 62 158,864 (445) (1,121) (412) 20,226
--------- ------------ ------------- ---------- ------------ ------------
Total (losses) earnings on investments 62 158,864 (445) (1,121) (412) 20,226
--------- ------------ ------------- ---------- ------------ ------------
Total additions 45,684 2,325,903 42,857 33,541 14,280 190,488
DEDUCTIONS
- ----------
Participant benefit payments 104 170,409 123 655 26 588
--------- ------------ ------------- ---------- ------------ ------------
Net increase 45,580 2,155,494 42,734 32,886 14,254 189,900
Transfers from (to):
Other master trust investment accounts 29,496 (87,175) 3,974 6,978 3,026 42,546
Net loans (2,918) (201,837) (336) (4,294) 400 (3,035)
MCI Communications Retirement Savings Plan 10,626 (736,151) 1,866 3,227 (74) 11,301
Net assets available for benefits, at
beginning of year 0 3,392,532 0 0 0 0
--------- ------------ ------------- ---------- ------------ ------------
Net assets available for benefits, at
end of year $ 82,784 $ 4,522,863 $ 48,238 $ 38,797 $ 17,606 $ 240,712
========= ============ ============= ========== ============ ============
</TABLE>
Page 29
<PAGE>
<TABLE>
MCI CONSUMER MARKETS 401(k) PLAN
EIN: 13-2745892
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 1994
Putnam Stable Putnam MCI
Diversified Asset New Common Loan
Income Fund Opportunities Stock Fund Total
ADDITIONS ----------- ------------- ------------- ------------- ------------ -------------
- ---------
<S> <C> <C> <C> <C> <C> <C>
Contributions:
Participants $ 15,698 $ 2,533,429 $ 211,166 $ 2,938,224 $ 0 $ 10,276,746
Non-cash employer 0 0 0 5,878,160 0 5,878,160
Rollovers 21,935 208,508 33,115 46,496 0 662,020
Non-cash supplemental 0 0 0 3,341,420 0 3,341,420
----------- ------------- ------------- ------------- ------------ -------------
Total contributions 37,633 2,741,937 244,281 12,204,300 0 20,158,346
----------- ------------- ------------- ------------- ------------ -------------
Earnings on investments:
Interest on participant loans 0 0 0 0 79,370 79,370
Interest on guaranteed investment contracts 0 539,178 0 0 0 539,178
Dividends on common stock 0 0 0 35,672 0 35,672
Net (loss) on disposition of assets 0 0 0 (171,694) 0 (171,694)
Unrealized (depreciation) of assets 0 0 0 (6,068,896) 0 (6,068,896)
Net (loss) gain from registered investment
companies (2,069) 0 20,025 0 0 300,674
----------- ------------- ------------- ------------- ------------ -------------
Total (losses) earnings on investments (2,069) 539,178 20,025 (6,204,918) 79,370 (5,285,696)
----------- ------------- ------------- ------------- ------------ -------------
Total additions 35,564 3,281,115 264,306 5,999,382 79,370 14,872,650
DEDUCTIONS
- ----------
Participant benefit payments 25 648,983 1,366 826,360 59,965 1,872,131
----------- ------------- ------------- ------------- ------------ -------------
Net increase 35,539 2,632,132 262,940 5,173,022 19,405 13,000,519
Transfers from (to):
Other master trust investment accounts 20,418 (485,000) 101,000 178,512 0 0
Net loans (8,660) (582,405) (2,313) (183,656) 1,191,536 15,302
MCI Communications Retirement Savings Plan 485 (1,104,535) 16,439 (1,826,228) 115,875 (2,968,626)
Net assets available for benefits, at
beginning of year 0 9,902,851 0 11,375,691 497,683 28,055,152
----------- ------------- ------------- ------------- ------------ -------------
Net assets available for benefits, at
end of year $ 47,782 $ 10,363,043 $ 378,066 $ 14,717,341 $ 1,824,499 $ 38,102,347
=========== ============= ============= ============= ============ =============
</TABLE>
Page 30
<PAGE>
<TABLE>
<CAPTION>
MCI CONSUMER MARKETS 401(k) PLAN
EIN: 13-2745892
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 1993
Putnam Stable Laurel MCI
Voyager Asset S&P 500 Common Loan
Fund Fund Stock Index Stock Fund Total
ADDITIONS ------------ ------------- ------------ ------------- ----------- --------------
- ---------
<S> <C> <C> <C> <C> <C> <C>
Contributions:
Participants $1,600 714 $ 2,380,524 $ 1,135,661 $ 2,036,583 $ 0 $ 7,153,482
Non-cash employer 0 0 0 3,097,810 0 3,097,810
Rollovers 0 62,620 1,151 5,306 0 69,077
----------- ------------- ------------- ------------- ------------ -------------
Total contributions 1,600,714 2,443,144 1,136,812 5,139,699 0 10,320,369
----------- ------------- ------------- ------------- ------------ -------------
Earnings on investments:
Interest on participant loans 0 0 0 0 9,466 9,466
Interest on guaranteed investment contracts 0 426,037 0 0 0 426,037
Dividends on common stock 0 0 0 16,193 0 16,193
Net gain on disposition of assets 0 0 0 74,727 0 74,727
Unrealized appreciation of assets 0 0 0 2,182,318 0 2,182,318
Net gain from collective investment
funds of trustee 774 5,877 327,904 320 0 334,875
Net gain from registered investment
companies 415,465 0 0 0 0 415,465
----------- ------------- ------------- ------------- ------------ -------------
Total earnings on investments 416,239 431,914 327,904 2,273,558 9,466 3,459,081
----------- ------------- ------------- ------------- ------------ -------------
Total additions 2,016,953 2,875,058 1,464,716 7,413,257 9,466 13,779,450
DEDUCTIONS
- ----------
Participant benefit payments 72,107 348,278 85,007 291,486 21,295 818,173
----------- ------------- ------------- ------------- ------------ -------------
Net increase 1,944,846 2,526,780 1,379,709 7,121,771 (11,829) 12,961,277
Transfers from (to):
Other investment accounts 7,000 (124,000) (22,000) 139,000 0 0
Net loans (83,790) (6,017) (65,022) (98,332) 253,161 0
MCI Communications Retirement Savings Plan 1,524,476 2,842,128 877,776 3,848,004 256,351 9,348,735
Long Lines 401(k) Retirement Savings Plan 0 4,663,960 715,932 365,248 0 5,745,140
Net assets available for benefits, at
beginning of year 0 0 0 0 0 0
----------- ------------- ------------- ------------- ------------ -------------
Net assets available for benefits, at
end of year $3,392,532 $ 9,902,851 $ 2,886,395 $ 11,375,691 $ 497,683 $ 28,055,152
=========== ============= ============= ============= ============ =============
</TABLE>
Page 31
<PAGE>
NOTE 5 - PARTICIPANTS' ACCOUNTS
As of December 31, 1994 and 1993, the Plan held 793,127 and 345,327 shares of
MCI Communications Corporation common stock at fair market values of $14,573,709
and $9,755,488, respectively. Of these shares, 283,770 and 92,930 were
contributed by MCIT during the Plan years ended December 31, 1994 and 1993,
respectively, as MCIT's matching contributions. As of December 31, 1994 and
1993, the Plan's benefit claims payable was $4,376,143 and $1,328,594,
respectively, which includes 97,495 and 21,542 shares of MCI Communications
Corporation common stock at fair market values of $1,791,471 and $608,562,
respectively. Net assets include account balances of participants who have
terminated from MCIT and have not received a distribution as of year end.
NOTE 6 - FEDERAL INCOME TAX STATUS
As described in Note 1, the Plan is Part I of the MCI Consumer Markets 401(k) &
ESOP. As allowed by the IRS, MCIT filed for a determination letter from the IRS
during March 1995 covering the Plan. The Plan Administrator anticipates
receiving a favorable determination from the IRS on these amendments.
NOTE 7 - SUBSEQUENT EVENTS
Effective January 1, 1995, the Plan will charge a $30 origination fee for loans
and a $20 annual account maintenance fee for participants who terminate
employment and elect to keep their funds in the Plan.
Effective January 24, 1995, the Plan will distribute in a lump sum terminated
participant accounts with a vested balance of less than $3,500. The distribution
will occur no sooner than six months after the participant's termination date.
Effective July 1, 1995, the Plan will decrease the investment options to seven
funds. The investment options will be: EuroPacific Growth Fund, Dreyfus S&P 500
Stock Index Portfolio, Putnam Voyager Fund, Putnam New Opportunities Fund,
Stable Asset Fund, Putnam Balanced Retirement Fund, and MCI Communications
Corporation Common Stock Fund. Participants with balances in the funds to be
eliminated will have opportunities during June 1995 to reallocate their fund
balances into the seven remaining funds.
Page 32
<PAGE>
<TABLE>
<CAPTION>
SCHEDULE I
MCI COMMUNICATIONS CORPORATION
DEFINED CONTRIBUTION MASTER TRUST
ITEM 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
DECEMBER 31, 1994
CURRENT
NUMBER VALUE AT
DESCRIPTION/ISSUER OF SHARES COST 12/31/94
- ------------------ --------- ------------ ------------
<S> <C> <C> <C>
LOANS TO PARTICIPANTS
Participant loan accounts (rates range 7% - 11%) $ 0 $ 15,941,326
------------
INTEREST IN COLLECTIVE INVESTMENT
FUNDS OF TRUSTEE
* Mellon Bank Temporary
Investment Fund 1,412,297 1,412,297
------------
INTEREST IN REGISTERED INVESTMENT COMPANIES
EuroPacific Growth Fund 304,193 6,680,397 6,427,590
* Putnam Growth & Income 260,791 3,455,550 3,317,256
* Putnam Income Fund 108,315 725,473 700,797
* Putnam Vista Fund 330,577 2,384,019 2,373,546
Scudder Income Fund 152,130 1,945,207 1,874,242
* Dreyfus S&P 500 Stock Index 3,590,744 36,626,706 36,015,159
* Putnam Investors Fund 60,225 466,084 430,005
* Putnam Voyager Fund 5,437,965 53,330,297 62,645,356
* Putnam Convertible Income-Growth 41,404 775,610 709,251
* Putnam High Yield Advantage 46,622 447,135 419,598
* Putnam Global Gov't Income 16,460 225,387 212,661
* Putnam OTC Emerging Growth 280,763 3,008,463 3,032,240
* Putnam Diversified Income 31,974 376,981 359,063
* Putnam New Opportunities 182,643 4,338,093 4,615,388
------------
Total investment in registered
investment companies 123,132,152
------------
GUARANTEED INVESTMENT CONTRACTS
Aetna Life Insurance (6.63% Matures 6/30/00) 17,859,506 17,859,506
Allstate Life Insurance Company (5.90% Matures 7/1/98) 5,772,945 5,772,945
John Hancock Mutual Life Insurance (8.05% Matures 6/30/99) 12,215,389 12,215,389
Metropolitan Life Insurance (8.96% Matures 6/30/96) 12,503,446 12,503,446
New York Life Insurance (6.82% Matures 3/31/98) 7,753,634 7,753,634
Peoples Security Insurance Company (5.72% Matures 12/31/98) 7,318,368 7,318,368
Peoples Security Insurance Company (5.86% Matures 3/31/98) 5,242,046 5,242,046
Principal Mutual Life Insurance (9.10% Matures 12/31/96) 19,764,398 19,764,398
Prudential Life Insurance (7.00% Matures 9/30/98) 4,975,399 4,975,399
TransAmerica Life Insurance (5.60% Matures 6/30/95) 5,139,244 5,139,244
------------
Total guaranteed investment contracts 98,544,375
------------
COMMON STOCK
* MCI Communications Corporation 7,956,146 159,866,687 146,194,183
------------
TOTAL INVESTMENTS $385,224,333
============
<FN>
* Denotes a party-in-interest
</FN>
</TABLE>
Page 33
<PAGE>
<TABLE>
<CAPTION>
SCHEDULE II
MCI COMMUNICATIONS CORPORATION
DEFINED CONTRIBUTION MASTER TRUST
ITEM 27d - SCHEDULE OF REPORTABLE TRANSACTIONS
FOR THE YEAR ENDED DECEMBER 31, 1994
Transactions or series of transactions exceeding 5% of the beginning fair values
of master trust assets for the plan year January 1, 1994 to December 31, 1994
are considered reportable transactions. Fair value at January 1, 1994 is
$326,475,530. Five percent (5%) of fair value is $16,323,777.
Identity Expense Current
of incurred value of asset
party Purchase Selling Lease with Cost of on transaction Net gain
involved Description of asset price price rental transaction asset date or (loss)
- -------- ----------------------- -------------- ------------- ------ ----------- -------------- -------------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
* Putnam Voyager Fund $ 16,798,906 $ 16,798,906 $ 16,798,906 $ 0
(108 purchases)
* Mellon Bank Temporary $ 41,248,437 $ 41,248,437 $ 41,248,437 $ 0
Investment Fund (487 purchases)
* Mellon Bank Temporary $ 39,836,235 $ 39,836,235 $ 39,836,235 $ 0
Investment Fund (532 sales)
<FN>
* Denotes a party-in-interest
</FN>
</TABLE>
Page 34
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Plan
sponsor of the MCI Consumer Markets 401(k) & ESOP has duly caused this annual
report to be signed on its behalf by the undersigned, thereunto duly authorized.
MCI CONSUMER MARKETS 401(k) -
PART I OF THE MCI CONSUMER
MARKETS 401(k) & ESOP
Date: June 30, 1995 BY /s/ Douglas L. Maine
------------------------------
Douglas L. Maine
Chief Financial Officer and
Executive Vice President
MCI Telecommunications Corporation
Page 35
Exhibit 23
----------
MCI CONSUMER MARKETS 401(k) PLAN
EIN: 13-2745892
CONSENT OF INDEPENDENT ACCOUNTANTS
----------------------------------
We hereby consent to the incorporation by reference in the Prospectus
constituting part of the Registration Statement of Form S-8 (No. 33-49304) of
MCI Communications Corporation of our report dated June 16, 1995, appearing on
page 3 of this Form 11-K.
/s/ PRICE WATERHOUSE LLP
- ------------------------
PRICE WATERHOUSE LLP
Washington, D.C.
June 30, 1995
Page 36
Exhibit 99
DOL Filing Confirmation ----------
I certify that the Plan Administrator of the MCI Consumer Markets 401(k) & ESOP
has received a Statement of Assets and Liabilities and also that the statement
has been filed directly with the United States Department of Labor by Mellon
Bank, N.A. (EIN # 25-0659206) for the following investment arrangements:
EIN #
--------------
Mellon Bank Temporary Investment Fund 25-6078903-980
MCI CONSUMER MARKETS 401(k) -
PART I OF THE MCI CONSUMER
MARKETS 401(k) & ESOP
Date: June 30, 1995 BY /s/ Douglas L. Maine
------------------------------
Douglas L. Maine
Chief Financial Officer and
Executive Vice President
MCI Telecommunications Corporation
Page 37
