CALENERGY COMPANY, INC.
401(k) SAVINGS PLAN
Financial Statements, Supplemental Schedules
for the Years Ended December 31, 1996 and 1995
and Independent Auditors' Report
CALENERGY COMPANY, INC. 401(K) SAVINGS PLAN
TABLE OF CONTENTS
Page
Independent Auditors' Report 1
Financial Statements:
Statements of Net Assets Available for Benefits as of
December 31, 1996 and 1995 2-3
Statements of Changes in Net Assets Available for Benefits for the
Years Ended December 31, 1996 and 1995 4-5
Notes to Financial Statements 6-8
Supplemental Schedules:
Item 27a - Schedule of Assets Held for Investment
Purposes at December 31, 1996 9
Item 27d - Schedule of Reportable Transactions for the
Year Ended December 31, 1996 10
Supplemental schedules not listed above are omitted because of
the absence of conditions under which they are required.
Exhibit I - Independent Auditors' Consent 11
INDEPENDENT AUDITORS' REPORT
To the Trustees of CalEnergy Company, Inc.
401(k) Savings Plan
We have audited the accompanying statements of net assets available for
benefits of CalEnergy Company, Inc. 401(k) Savings Plan (the "Plan") as of
December 31, 1996 and 1995, and the related statements of changes in net
assets available for benefits for the years then ended. These financial
statements are the responsibility of the Plan's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards 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. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of the Plan as of
December 31, 1996 and 1995, and changes in net assets available for benefits
for the years then ended, in conformity with generally accepted accounting
principles.
Our audits were performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules listed in
the table of contents are presented for the purpose of additional analysis and
are not a required part of the basic financial statements, but are
supplementary information required by the Department of Labor's Rules and
Regulations for Reporting and Disclosure under the Employee Retirement Income
Security Act of 1974. The supplemental information by fund in the statements
of net assets available for benefits and the statements of changes in net
assets available for benefits is presented for purposes of additional analysis
rather than to present net assets available for benefits and changes in net
assets available for benefits of the individual funds. The supplemental
schedules and supplemental information by fund is the responsibility of the
Plan's management. Such supplemental schedules and supplemental information
by fund 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.
DELOITTE & TOUCHE LLP
Omaha, Nebraska
May 23, 1997
CALENERGY COMPANY, INC. 401(k) SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1996
Supplemental Information by Fund
<TABLE>
<CAPTION>
Dreyfus Dreyfus New England
Capital Capital New Dreyfus Guaranteed
Preservation Value Leaders GNMA Investment
ASSETS Total Fund Fund Fund Fund Fund
<S> <C> <C> <C> <C> <C> <C> <C>
INVESTMENTS, at fair value:
Capital
Preservation Fund $3,965,776$3,965,776 $ - $ - $ - $ - $ -
Dreyfus Capital
Value Fund 590,229 - 590,229 - - - -
Dreyfus New
Leaders Fund 7,590,567 - - 7,590,567 - - -
Dreyfus GNMA Fund 2,756,684 - - - 2,756,684 - -
Loan Fund 1,523,623 - - - - - 1,523,623
CalEnergy Stock 5,535,919 - - - - - -
Money Market Fund 30,046 17,800 - 18 - - -
New England
Guaranteed
Investment Fund 800,191 - - - - 800,191 -
Dreyfus Strategic
Income 36,926 - - - - - -
Dreyfus
Disciplined Stock
Fund 918,447 - - - - - -
Dreyfus Apprecation
Fund 346,410 - - - - - -
Total investments 24,094,818 3,983,576 590,229 7,590,585 2,756,684 800,191 1,523,623
CONTRIBUTIONS
RECEIVABLE:
Employer 188,642 34,638 - 75,660 20,321 - -
Employee 94,110 20,043 - 36,168 10,997 - -
Total contributions
receivable 282,752 54,681 - 111,828 31,318 - -
NET ASSETS AVAILABLE
FOR BENEFITS $24,377,570$4,038,257 $590,229$7,702,413$2,788,002$800,191$1,523,623
</TABLE>
Statement of Net Assets Available for Benefits (Continued)
Dreyfus
Dreyfus Disciplined Dreyfus
Loan CalEnergy Strategic Stock Appreciation
ASSETS Fund Stock Income Fund Fund
INVESTMENTS,
at fair value:
Capital Preservation
Fund $ - $ - $ - $ - $ -
Dreyfus Capital
Value Fund - - - - -
Dreyfus New Leaders
Fund - - - - -
Dreyfus GNMA Fund - - - - -
Loan Fund 1,523,623 - - - -
CalEnergy Stock - 5,535,919 - - -
Money Market Fund - 12,161 - 12 55
New England Guaranteed
Investment Fund - - - - -
Dreyfus Strategic Fund - - 36,926 - -
Dreyfus Disciplined
Stock Fund - - - 918,447 -
Dreyfus Appreciation
Fund - - - - 346,410
Total investments 1,523,623 5,548,080 36,926 918,459 346,465
CONTRIBUTIONS
RECEIVABLE
Employer - 41,619 892 6,844 8,668
Employee - 19,763 542 2,764 3,833
Total contributions
receivable - 61,382 1,434 9,608 12,501
NET ASSETS AVAILABLE
FOR BENEFITS $1,523,623 $5,609,462 $38,360 $928,067 $358,966
The accompanying notes are an integral part of the financial statements.
CALENERGY COMPANY, INC. 401(k) SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1995
Supplemental Information by Fund
<TABLE>
<CAPTION>
Dreyfus Dreyfus New England
Capital Capital New Dreyfus Guaranteed
Preservation Value Leaders GNMA Investment Loan CalEnergy
ASSETS Total Fund Fund Fund Fund Fund Fund Stock
<S> <C> <C> <C> <C> <C> <C> <C> <C>
INVESTMENTS, at fair value:
Capital Preservation Fund $ 3,676,194 $ 3,676,194 $ - $ - $ - $ - $ - $ -
Dreyfus Capital Value Fund 680,191 - 680,191 - - - - -
Dreyfus New Leaders Fund 4,634,493 - - 4,634,493 - - - -
Dreyfus GNMA Fund 2,664,892 - - - 2,664,892 - - -
CalEnergy Stock 2,720,153 - - - - - - 2,720,153
Money Market Fund 22,338 1,551 - - - - - 20,787
New England Guaranteed
Investment Fund 764,622 - - - - 764,622 - -
Loans to participants 1,164,968 - - - - - 1,164,968 -
Total investments 16,327,851 3,677,745 680,191 4,634,493 2,664,892 764,622 1,164,968 2,740,940
CONTRIBUTIONS RECEIVABLE:
Employer 172,246 39,698 11,031 61,677 25,519 - - 34,321
Employee 80,902 18,333 6,717 27,497 12,037 - - 16,318
Total contributions
receivable 253,148 58,031 17,748 89,174 37,556 - - 50,639
NET ASSETS AVAILABLE
FOR BENEFITS $16,580,999 $3,735,776 $697,939 $4,723,667 $2,702,448 $764,622 $1,164,968 $2,791,579
</TABLE>
The accompanying notes are an integral part of the financial statements.
CALENERGY COMPANY, INC. 401(k) SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
YEAR ENDED DECEMBER 31, 1996
<TABLE>
<CAPTION>
Supplemental Information by Fund
Dreyfus Dreyfus New England
Capital Capital New Dreyfus Guaranteed
Preservation Value Leaders GNMA Investment
Total Fund Fund Fund Fund Fund
<S> <C> <C> <C> <C> <C> <C>
ADDITIONS TO NET ASSETS
ATTRIBUTED TO:
Investment Income:
Interest $ 384,959 $ 214,522 $ - $ 12,315 $ - $ 35,569
Dividend income 786,843 189 35,545 520,210 166,792 -
Net appreciation (depreciation)
in the fair value of
investments 2,444,956 - (74,146) 415,476 (53,702) -
Net investment income 3,616,758 214,711 (38,601) 948,001 113,090 35,569
Contributions:
Employer 1,067,142 216,504 54,462 407,741 149,427 -
Employee 2,531,202 518,477 136,949 959,108 359,584 -
Rollovers 2,097,877 68,708 3,995 1,019,270 137,118 -
Total contributions 5,696,221 803,689 195,406 2,386,119 646,129 -
Total additions 9,312,979 1,018,400 156,805 3,334,120 759,219 35,569
DEDUCTIONS FROM NET
ASSETS ATTRIBUTED TO:
Distributions to terminated
participants (1,516,408) (455,486) (75,924) (414,302) (246,237) -
NET TRANSFERS AMONG
FUNDS - (260,433) (188,591) 58,928 (427,428) -
NET INCREASE (DECREASE) 7,796,571 302,481 (107,710) 2,978,746 85,554 35,569
NET ASSETS AVAILABLE
FOR BENEFITS,
Beginning of the Year 16,580,999 3,735,776 697,939 4,723,667 2,702,448 764,622
NET ASSETS AVAILABLE
FOR BENEFITS,
End of the Year $24,377,570 $4,038,257 $590,229 $7,702,413 $2,788,002 $800,191
</TABLE>
Statement of Changes in Net Assets Available for Benefits, (Continued)
Dreyfus
Dreyfus Disciplined Appreci-
Loan CalEnergy Strategic Stock ation
Fund Stock Income Fund Fund
ADDITIONS TO NET ASSETS
ATTRIBUTED TO:
Investment Income:
Interest $ 120,577 $ 1,976 $ - $ - $ -
Dividend income - - 241 60,626 3,240
Net appreciation
(depreciation) in
the fair value of
investments - 2,177,781 127 (21,458) 878
Net investment income 120,577 2,179,757 368 39,168 4,118
Contributions:
Employer - 222,604 892 6,844 8,668
Employee - 529,522 1,973 9,492 16,097
Rollovers 67,312 35,138 - 766,336 -
Total Contributions 67,312 787,264 2,865 782,672 24,765
Total additions 187,889 2,967,021 3,233 821,840 28,883
DEDUCTIONS FROM NET
ASSETS ATTRIBUTED TO:
Distributions to terminated
participants (93,423) (231,036) - - -
NET TRANSFERS AMONG FUNDS 264,189 81,898 35,127 106,227 330,083
NET INCREASE (DECREASE) 358,655 2,817,883 38,360 928,067 358,966
NET ASSETS AVAILABLE
FOR BENEFITS,
Beginning of the Year 1,164,968 2,791,579 - - -
NET ASSETS AVAILABLE
FOR BENEFITS,
End of the Year $1,523,623 $5,609,462 $38,360 $928,067 $358,966
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS
CALENERGY COMPANY, INC. 401(k) SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
YEAR ENDED DECEMBER 31, 1995
<TABLE>
<CAPTION>
Supplemental Information by Fund
Dreyfus Dreyfus New England
Capital Capital New Dreyfus Guaranteed
Preservation Value Leaders GNMA Investment Loan CalEnergy
Total Fund Fund Fund Fund Fund Fund Stock
ADDITIONS TO NET ASSETS
ATTRIBUTED TO:
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Investment Income:
Interest $ 408,089 $ 104,577 $ - $ 214,304 $ - $ 33,993 $ 54,256 $ 959
Dividend income 281,805 - 28,596 152,054 101,155 - - -
Net appreciation
(depreciation) in the
fair value of investments 1,235,421 - (47,907) 638,789 163,001 - - 481,538
Net investment income 1,925,315 104,577 (19,311) 1,005,147 264,156 33,993 54,526 482,497
Contributions:
Employer 902,480 210,625 70,011 298,933 131,796 - - 191,115
Employee 2,083,916 462,100 177,392 686,744 296,788 - - 460,892
Rollovers 7,542,782 2,956,637 463 2,593,023 1,948,859 - - 43,800
Total contributions 10,529,178 3,629,362 247,866 3,578,700 2,377,443 - - 695,807
Total additions 12,454,493 3,733,939 228,555 4,583,847 2,641,599 33,993 54,256 1,178,304
DEDUCTIONS FROM NET
ASSETS ATTRIBUTED TO:
Distributions to
terminated participants (2,370,692) (833,777) (12,452) (845,519) (544,826) - (39,222) (94,896)
NET TRANSFERS AMONG
FUNDS - (13,768) (103,564) (315,197) (176,001) - 572,881 35,649
NET INCREASE 10,083,801 2,886,394 112,539 3,423,131 1,920,772 33,993 587,915 1,119,057
NET ASSETS AVAILABLE
FOR BENEFITS,
Beginning of the Year 6,497,198 849,382 585,400 1,300,536 781,676 730,629 577,053 1,672,522
NET ASSETS AVAILABLE
FOR BENEFITS,
End of the Year $16,580,999 $3,735,776 $697,939 $4,723,667 $2,702,448 $764,622 $1,164,968 $2,791,579
</TABLE>
The accompanying notes are an integral part of the financial statements
CALENERGY COMPANY, INC. 401(K) SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996 AND 1995
1. DESCRIPTION OF PLAN
The following description of the CalEnergy Company, Inc. 401(k) Savings
Plan (the "Plan") provides only general information. Participants should
refer to the Summary Plan Description for a more complete description of
the Plan's provisions.
General - On August 26, 1989, CalEnergy Company, Inc. (the "Company")
established the Plan with an effective date retroactive to January 1,
1989. The Plan is a defined contribution plan covering all active
employees of the Company. It is subject to the provisions of the Employee
Retirement Income Security Act of 1974 (ERISA), as amended. Effective
April 1, 1995, all of the assets, $7,198,773, of the Magma Power Company
Retirement Savings Plan were merged into the Plan. Effective November 5,
1996, assets of $1,816,337 of the Falcon Seaboard Resources, Inc. 401(k)
Profit Sharing Plan were merged into the Plan.
Trustee - The Dreyfus Trust Company ("Dreyfus") is the Plan Trustee and
executes all investment transactions and recordkeeping. All investment
transactions are determined based on the allocation of investments as
directed by the participants.
Contributions - Participants may make salary deferrals up to a maximum of
the lesser of 15% of the participant's eligible salary or $9,500 and
$9,240 per year in 1996 and 1995, respectively.
The Company matches employee contributions at 100 percent of the first
$1,000 of employees deferral up to a maximum of 10 percent of each
participant's eligible earnings as defined and 30 percent of the amount
above $1,000 up to 10 percent of each participant's eligible earnings as
defined.
Participant Accounts - Each participant's account is credited with the
participant's contribution and an allocation of (a) the Company's
contribution and (b) Plan earnings (or losses). Allocations are based on
participant earnings on account balances, as defined. The benefit to
which a participant is entitled is the benefit that can be provided from
the participant's account.
Vesting - Participants are immediately vested in their salary deferral
contributions, the Company's matching contributions and net earnings
thereon.
Payment of Benefits - Upon termination of service, a participant may elect
to receive a lump-sum distribution equal to the fair value of his or her
account or maintain the account with the Plan until retirement. "Pre-'91
Accruals," as defined, may be payable in the form of non-transferable
annuity contracts.
2. SUMMARY OF ACCOUNTING POLICIES
Basis of Accounting - The accompanying financial statements have been
prepared on the accrual basis of accounting.
Investments - Investments are stated at fair value. The Company common
stock is valued at the last published sales price at the end of the Plan
year. The Dreyfus funds and the Capital Preservation Fund are valued at
quoted market prices. The New England Guaranteed Investment Fund is
valued at contract value which approximates estimated fair value.
Participant loans are valued at cost which approximates fair value.
The CalEnergy stock fund includes a balance of 164,637 and 139,495 shares
of the Company's common stock at December 31, 1996 and 1995, respectively.
Net Appreciation (Depreciation) in the Fair Value of Investments - The
Plan presents in the statement of changes in net assets available for
benefits the net appreciation (depreciation) in the fair value of
investments which consists of the realized gains or losses and the
unrealized appreciation (depreciation) on those investments. Such amounts
are based on the beginning of the year fair value, or cost if purchased
during the year.
Administrative Expenses - All costs of Plan administration are paid by the
Company.
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 the disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from
those estimates.
3. TAX STATUS
The Internal Revenue Service has determined and informed the Company by a
letter dated October 31, 1996, that the Plan and related trust are
designed in accordance with applicable sections of the Internal Revenue
Code (IRC). The Plan has been amended since receiving the determination
letter. However, 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. Therefore, no
provision for income taxes has been included in the Plan's financial
statements.
4. PLAN TERMINATION
Although it has not expressed any intent to do so, the Company has the
right to discontinue its contributions at any time and to terminate the
Plan subject to the provisions of ERISA. In the event the Plan is
terminated, affected participants will receive all amounts credited to
their accounts.
5. LOANS TO PARTICIPANTS
Active participants may borrow from their vested account balances subject
to certain limitations. These loans bear interest at the prime rate plus
1% (which is fixed at the inception of the loan) and maturities may not
exceed five years. At December 31, 1996 and 1995, loans outstanding bear
interest rates of 9.5% to 10.0%.
6. RELATED PARTY TRANSACTIONS
Certain Plan investments are shares of mutual funds managed by the Dreyfus
Trust Company. The Dreyfus Trust Company is the trustee as defined by the
Plan and, therefore, these transactions qualify as party-in-interest. In
addition, transactions of the CalEnergy stock fund qualify as party-in-
interest.
CALENERGY COMPANY, INC. 401(k) SAVINGS PLAN
ITEM 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
DECEMBER 31, 1996
Column A Column B Column C Column D Column E
Description of Investment,
Including Collateral, Rate
Identity of Issuer, Borrower, of Interest, Maturity Date, Current
Lessor, or Similar Party Par, or Maturity Value Cost Value
LaSalle National Trust Capital Preservation Fund $ 3,965,776 $ 3,965,776
* Dreyfus Corporation Capital Value Fund 708,973 590,229
* Dreyfus Corporation New Leaders Fund 6,924,752 7,590,567
* Dreyfus Corporation GNMA Fund 2,738,147 2,756,684
* CalEnergy Company, Inc. CalEnergy Common Stock,
164,637 shares 3,159,463 5,535,919
* Dreyfus Corporation Loan Fund - 1,523,623
* Dreyfus Corporation Money Market Fund 30,046 30,046
The New England Guaranteed Investment
Contract #5735-1, 5.35%,
maturity date 12/31/98 766,408 766,408
The New England Guaranteed Investment
Contract #5735-2, 4.7%,
maturity date 12/31/99 33,783 33,783
* Dreyfus Corporation Strategic Income 36,838 36,926
* Dreyfus Corporation Disciplined Stock Fund 940,314 918,447
* Dreyfus Corporation Appreciation Fund 345,532 346,410
Total investments $19,650,032 $24,094,818
* Party-in-interest.
CALENERGY COMPANY, INC. 401(k) SAVINGS PLAN
ITEM 27d - SCHEDULE OF REPORTABLE TRANSACTIONS
YEAR ENDED DECEMBER 31, 1996
<TABLE>
<CAPTION>
Series Transactions, When Aggregated, Involving an Amount
in Excess of Five Percent of the Current Value of Plan Assets
Column A Column B Column C Column D Column E Column F Column G
Total Total
Dollar Dollar
Number of Number of Value of Value of Net Gain
Identity of Party Involved Description of Asset Purchases Sales Purchases Sales (Loss)
<S> <C> <C> <C> <C> <C> <C>
* Dreyfus Corporation Money Market Fund 357 89 $2,344,360 $2,338,990 $ -
* CalEnergy Company, Inc. Common Stock 49 18 1,460,376 731,414 254,244
* Dreyfus Corporation New Leader Fund 150 71 3,624,728 1,109,213 161,574
* Dreyfus Corporation GNMA Fund 90 117 9,168,890 791,240 13,584
LaSalle National Trust Capital
Preservation Fund 113 125 1,603,609 1,303,899 -
* Dreyfus Corporation Disciplined
Stock Fund 30 2 974,175 34,271 410
</TABLE>
* Party-in-Interest.
EXHIBIT I
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in Registration Statement No. 33-
52147 on Form S-8 of CalEnergy Company, Inc. of our report dated May 23, 1997,
appearing in this Annual Report on Form 11-K of CalEnergy Company, Inc. for
the year ended December 31, 1996.
DELOITTE & TOUCHE LLP
Omaha, Nebraska
June 30, 1997
